Associated Rubber Products vs Harry and Jenny and Another

N.K. Patil, J.—Petitioner in this petition is M/s. Associated Rubber Products represented by its Managing Partner. Petitioner, being aggrieved by the order dated 11th June 2004 passed on Preliminary Issue No. V in O.S. No. 5292/1997 on the file of the XXX Additional City Civil Judge, Bangalore City, has presented the instant memorandum of Civil Revision Petition.

The grievance of petitioner in this petition is that, the respondents herein have filed original suit in O.S. No. 5292/1997 for recovery of a sum of Rs. 2,28,130/- along with future interest at the rate of 21% per annum from the date of suit till its realization against the petitioner herein, inter alia, alleging that, the respondents had placed the order for supply of rubber raw materials from the petitioner which is a wholesale dealer of Rubber products based in Kottayam, Kerala. Pursuant to the order placed by respondents herein before the petitioner, petitioner had supplied sub- standard goods and that, the respondents requested the petitioner to replace the alleged sub-standard goods with goods answering to their specifications as per their orders, but petitioner did not oblige. In the meantime, the respondents had paid to the petitioner a sum of Rs. 1,13,386/- for supply of the goods ordered, but only goods worth only a sum of Rs. 66,643/- had been supplied to them by the petitioner. Be that as it may.

Upon service of notice by the Trial Court regarding the original suit filed by respondents herein, the petitioner appeared and filed the written statement. Thereafter, the Trial Court framed necessary points for consideration. At tis stage, petitioner herein has filed the interlocutory applications, I.A.II and III under Order 14, Rule 2 read with Section 151 of the CPC for hearing issue No. 5 as Preliminary Issue. The said applications filed by petitioner had come up for consideration before the Trial Court on 12th June 2003 and the Trial Court allowed the said applications and ordered for hearing on Preliminary Issue No. 5. The Trial Court observed that, the records disclose that, the plaintiffs-respondents have got examined as PW1 and Ex.P1 was marked. The defendant-petitioner also got examined himself as DW1 and no documents were marked on behalf of defendant-petitioner. The Trial Court after hearing both parties and after going through the pleadings available on file, has taken up consideration of Preliminary Issue No. 5 as to, Whether the defendant-petitioner herein proves that, the Trial Court has no jurisdiction to try the suit filed by plaintiffs-respondents. After considering the oral and documentary evidence, and other material available on file and after affording opportunity to the parties, the Trial Court has answered the said point in the negative and by its final order dated 11th June 2004, has held hat, the Trial Court has got jurisdiction to try the suit filed by plaintiffs-respondents. Assailing the correctness of the impugned order passed by Trial Court on Preliminary Issue No. 5, defendant - petitioner herein felt necessitated to present the instant revision petition, seeking quashing of the same on the ground that, the Trial Court has no jurisdiction to try the suit filed by respondents.

I have heard learned Counsel appearing for petitioner and learned Counsel appearing for respondents for considerable length of time.

After careful perusal of the impugned order passed by the Trial Court on Preliminary Issue No. 5, it is manifest on the face of the said order that, the Court below has committed a grave error and material irregularity in proceeding to pass the impugned order in as much as the Court below has not assigned any cogent reasons except holding that, in the case reported in Naresh Chandra Das Vs. Gopal Chandra Das, which deals under Order 14, Rule 2 of Code of Civil Procedure, it has been held that, the jurisdiction of the Court is mixed question of law and facts involved in the suit and it cannot be decided as Preliminary Issue and the said principle laid down is undisputed. Accordingly, the Trial Court answered the said point in the negative and came to the conclusion that, defendant has not proved that, the Trial Court has no jurisdiction to try the suit. The reasoning given by the Trial Court to hold that, the said Court has jurisdiction to try the suit cannot be sustained in view of the categorical admission made by first respondent in his cross examination wherein he has stated that "it is true that, Ex.P1 is the order placed by me with the defendant. It is true that, defendant accepted orders placed by me subject to conditions mentioned in the reverse side of Ex.P1. The demand draft given by me to the defendant was payable at Kottayam." Further it is pertinent to note that Ex.P1- order No. 2333 placed by respondents - plaintiffs, it is clearly stated as "Please supply us the articles mentioned below, subject to the terms and conditions printed overleaf". In the reverse side of said Ex.P1, it can be seen that, there are five terms and conditions and the relevant condition for consideration is condition No. 5. The said condition No. 5 reads thus:

Any dispute arising out of supply will be settled by Court having jurisdiction in the town of Kottayam in Kerala State.

After careful reading of the conditions mentioned overleaf of Ex.P1, particularly condition No. 5, as extracted above, it is crystal clear that, respondents herein had admitted to the terms and conditions at the time of placing the orders before the petitioner. If once they have admitted and placed orders agreeing to all the terms and conditions mentioned overleaf of Ex.P1, it is not now open for them to contend before the Court below by way of filing the applications, that, the Court at Bangalore alone has got jurisdiction and that, the same is not in consonance with the terms and conditions. As per the agreed terms and conditions, the jurisdiction to try the dispute between the parties herein is at Kottayam in Kerala. The stand of the respondents that, the dispute arising between the parties is to be tried only in the Court at Bangalore cannot be accepted when there is a specific condition to knock the doors of a particular Court and also when both the parties have agreed to the said condition. This clinching piece of evidence has been lost sight of by the Trial Court. Further, the respondent No. 1 herein himself has categorically admitted that, Ex.P1 is the order placed by the respondents with the petitioner and it is true that, petitioner accepted the order placed by the respondents subject to the conditions mentioned overleaf of order - Ex.P1 and the Demand Draft given by respondents to the petitioner was payable at Kottayam. When condition No. 5 mentioned overleaf of order at Ex.P1 was amply clear and there was no ambiguity in the same, the Court below ought not to have held that, the Court below has the jurisdiction to try the suit filed by plaintiffs-defendants. The said reasoning given, that too, without assigning any valid and cogent reasons cannot be sustained at all and hence, it is liable to be set aside at the threshold itself on this ground alone.

Further, learned Counsel appearing for petitioner placed reliance on the judgment of the Apex Court in the case of Hanil Era Textiles Ltd. Vs. Puromatic Filters (P) Ltd., and submitted that, the ratio of law laid down by the Apex Court is directly applicable to the facts and circumstances of the case on hand. Further, learned Counsel has taken me through Head Note B of the said judgment and submitted that, when the ouster clause is clear, unambiguous and specific, the accepted notions of contract would bind the parties. Further, he drew my specific attention to Head Note C of the same judgment and submitted that, as per Section 20 of the Civil Procedure Code, 1908, when the Apex Court had to deal in respect of a condition similar to the one in the instant petition, viz., "Any legal proceedings arising out of the order shall be subject to the jurisdiction of the Courts in Mumbai", the Apex Court answered the question as to Whether the jurisdiction successfully confined to Mumbai, as, since clause not qualified by words like ''alone'', ''only'', or ''exclusively'', regard had to be had to other facts and circumstances of case to infer whether jurisdiction of all other Courts except Courts in Mumbai was excluded and ultimately held that, such an inference could be drawn.

At paragraph 8 of very same judgment, the Apex Court has observed that, the very same question was examined in considerable detail in A.B.C. Laminari (P) Limited v. A.P. Agencies (AIR Headnote D) and extracted paragraphs 20 and 21, which read thus:

When the Court has to decide the question of jurisdiction pursuant to an ouster clause it is necessary to construe the ousting expression or clause properly. Often the stipulation is that the contract shall be deemed to have been made at a particular place. This would provide the connecting factor for jurisdiction to the Courts of that place in the matter of any dispute on or arising out of that contract. It would not, however ipso facto take away jurisdiction of other Courts. Where an ouster clause occurs, it is pertinent to see whether there is ouster of jurisdiction of other Courts. When the clause is clear, unambiguous and specific accepted notions of contract would bind the parties and unless the absence of ad idem can be shown, the other Courts should avoid exercising jurisdiction. As regards construction of the ouster clause when words like ''alone'', ''only'' ''exclusive'' and the like have been used, there may be no difficulty. Even without such words in appropriate cases, the maxim ''expressio unius est exclusio alterius'' - expression of one is the exclusion of another may be applied. What is an appropriate case shall depend on the facts of the case. In such a case, mention of one thing may imply exclusion of another. When certain jurisdiction is specified in a contract an intention to exclude all others from its operation may in such cases be inferred. It has therefore to be properly construed.

(emphasis supplied)

After careful perusal of paragraph 8 of the judgment of the Apex Court, as extracted above, it emerges that, when a jurisdiction is specified in a contract, it can safely be presumed and inferred that, there is exclusion of all other Courts. Therefore, the Apex Court while dealing with the aforesaid question, observed that, there was a clear intention to confine the jurisdiction of the Courts in Bombay to the exclusion of all other Courts and therefore, the Court below therein had no territorial jurisdiction to try the suit. In the instant case also, as referred above, it is crystal clear that, the intention of the party is to confine the jurisdiction in the town of Kottayam in Kerala State. Therefore, when condition No. 5 is amply clear in mentioning that, "the disputes arising out of the supply of goods shall be settled by Court having jurisdiction in the town of Kottayam in the Kerala State", it could have been reasonably construed or presumed even in the absence of words like ''alone'', ''only'', or ''exclusive'', that, all the Courts other that the ones in the town of Kottayam in Kerala State are excluded from their operation. If the ratio of the law laid down by the Apex Court as aforesaid is applied to the case on hand, the impugned order passed by the Court below is highly unsustainable. Therefore, I am of the considered view that, the Trial Court has committed a grave error and illegality in proceeding to pass the impugned order without assigning any cogent reasons. Hence, it is liable to be set aside.

Learned Counsel appearing for respondents Sri Mahesh placed reliance on the judgment of the Apex Court in the case of Road Transport Corporation and Others Vs. Kirloskar Brothers Ltd. and Others, and another judgment in the case of Jaishree Luxury House, Kota and Another Vs. Kathotia Sons, Registered Partnership Firm, Delhi, and submitted that, the order passed by the Trial Court may be upheld, holding that, the Trial Court has jurisdiction to try the suit.

After going through the aforesaid judgments relied upon by learned Counsel appearing for respondents, I am of the view that, there is no quarrel or second opinion regarding the well settled law laid down in the said judgments, but the ratio of law laid down in the referred cases are entirely different from the one on hand and are of no assistance to him in the present petition. The law laid down in the aforesaid judgments cannot be made applicable to the instant case.

In the light of the facts and circumstances of the case, as stated above, the instant revision petition filed by petitioner is disposed of as follows:

I] The Civil Revision Petition filed by petitioner is allowed;

II] The impugned order passed by the XXX Additional City Civil Judge, Bangalore City on Preliminary Issue No. 5 dated 11th June 2004 in O.S. No. 5292/1997 is hereby set aside.

III] At this stage, learned Counsel appearing for respondents submitted that, the respondents 1 and 2 may be permitted to represent the plaint before the jurisdictional Court at Kottayam in Kerala State within sixty days from today.

IV] In the light of the submission made by learned Counsel appearing for respondents, respondents 1 and 2 are permitted to re-present the plaint before the jurisdictional Court at Kottayam in Kerala.