M/s. Andhra Steel Cprpn. Ltd. vs M/s. Sikri and Grover

Srinivasan J.

The defendant is challenging the decree passed by the learned First Additional City Civil Court, Madras, in O. S. No. 2303 of 1981 for a sum

of Rs. 67,392/- with interest at 15% per annum from 15.9.1976 till date of realisation. terms and conditions, the delivery should be effected free of

cost at the work spot of the defendant and payment will be made by presentation of documents through Vijaya Bank, Shanthi Nagar, Bangalore-

In the purchase order, general terms and conditions are printed on the reverse side. Clause 11 thereof is in the following terms:

This order in all respects shall be subject to the jurisdiction of the Bangalore Courts.

The plaintiff despatched the goods on 15.9.1976 and informed the defendant by letter of even date, marked as Ex. A4. The plaintiff also sent an

invoice under No. MD/267-76-77 (Ex.A-5) on the same day. A further letter was sent on 24.9.1976 by the plaintiff under Ex. A-6 confirming the

despatch of the goods and the sending of the invoice. That letter was sent through the Bangalore Representative of the plaintiff. The plaintiff waited

for payment and on 15.11.1976 wrote a letter marked as Ex. A7 calling upon the defendant to pay the amount to their representative M. S.

Srinivasan at Bangalore. There was no reply. The plaintiff sent a further letter on 22.11.1976 under Ex. A8 again requesting the defendant to pay

the money by cheque on 25.11.1976 when their representative will be calling upon the defendant. A registered letter under Ex. A9 was sent by the

plaintiff on 30.11.1976 to the defendant calling upon him to make payment before 4.12.1976. In spite of that, there was no response from the

defendant. A further letter was issued by the plaintiff on 24.12.1976 under Ex. A.10.

For the first time, the defendant sent a reply on 5.1.1977 under Ex. A.11. In that letter the defendant informed the plaintiff that he had not

received from their factory an evaluation report of the material supplied by the plaintiff and on receipt of the report steps will be taken for making

the payment. Even at this stage it maybe noted, the question of evaluation is raised for the first time after 3 1/2 months after receipt of goods by the

defendant. That was followed by a letter dated 6.1.1977 under Ex. A. 12 in which the defendant informed the plaintiff that a report had been

received from the factory that a few drums of transformer oil are found without rubber packing on the lid and giving a different smell on opening of

the drums. The plaintiff was requested in that letter to send a representative to the factory to check the same and let him know how this difference

in quality of oil could occur. The plaintiff protested immediately and sent a letter dated 10.1.1977, marked as Ex. A.13, expressing its surprise at,

the contents of the defendant''s letter. It was also pointed out in that letter that the plaintiffs representative had called on the defendant personally

several times and at no time any indication was made by the defendant as to the difference in the quality of oil. It was asserted by the plaintiff that

all the barrels were securely sealed and verified before despatch. A reference was also made to the receipt issued by the defendant acknowledging

delivery of the consignment in good condition.

The plaintiff''s lawyer sent a notice on 10.1.1977 under Ex. A14 calling upon the defendant to make payment with interest at 20% per annum. A

reply was sent by the defendant''s lawyer on 7.2.1977 under Ex. A.15 denying the claim.

Thereafter the plaintiff filed the present suit for recovery of a sum of Rs. 72,848/- with interest at 20% per annum on Rs. 67,392/- from the date

of plaint to the date of decree.

The defendant contested the suit on two grounds. According to the defendant, the Court at Madras had no jurisdiction and the Court in

Bangalore could alone have jurisdiction in view of Clause 11 of the terms and conditions printed on the reverse of EX. A.3. The second contention

was, that the oil sent by the plaintiff was of poor quality and it was not upto the prescribed specifications with the result the defendant is not liable

to pay the amount. It was also pleaded that the plaintiff had sent the goods even before the defendant instructed the plaintiff to do so.

The trial court held that the Court at Madras had jurisdiction and it is not excluded by Clause 11 of Ex. A.3. It also held that the case of the

defendant had not been proved and the plaintiff was entitled to the amount claimed by it with interest at 15% per annum from 15.9.76, the date of

dispatch of goods. It is the said decree which is now challenged in the appeal.

At the outset it should be pointed out that the defendant has not chosen to let in either oral or documentary evidence. The plaintiff has examined

two witnesses and marked 16 documents. We have already referred to 15 of them. The last of the documents Ex. A.16 is a laboratory report

obtained by the plaintiff on 12.9.1976 with reference to the quality of the oil which was dispatched by the plaintiff to the defendant. As per the

report, the oil was in good condition according to the prescribed standards. The evidence on record makes out that the case of the defendant that

poor quality oil was sent by the plaintiff is absolutely false. There is overwhelming evidence on the side of the plaintiff to prove the quality of the

same and the very conduct of the defendant in keeping silent for over 3 1/2 months after the receipt of the goods shows that he has come forward

with a false case in order to defeat and delay the claim of the plaintiff. If the barrels had been received by the defendant without proper packing

and with lids in some of them being open, the latter would have immediately sent a note to that effect to the plaintiff. The plaintiffs representative

has met the defendant on several occasions and on those occasions the defendant has chosen to point out to him any defect in the packing or in the

quality of the oil.

There is no substance in the contention of the defendant that the Court in Madras will have no jurisdiction. We have already extracted the

relevant clause in Ex. A3. That does not exclude the jurisdiction of any other court. The matter is not reintegrate. The question has been decided

by this court as well as by the Supreme Court in several cases. Suffice it to refer to the judgment in M/s. Salem Chemical Industries v. M/s. Bird &

Co. 91-L.W.522 (D.B.) : AIR 1979 Madras 16. In that case, the Bench pointed out that it is open to the parties to agree upon their dispute being

resolved by one of several courts which have jurisdiction to deal with the same and such an agreement will be valid. On the facts of that case it was

held that the relevant clause in the contract did not take away the jurisdiction of the Court in Salem. The clause read thus:

Any order placed against this quotation shall be deemed to be a contract made in Calcutta.

The contention that the said clause indicated an agreement between the parties to confine their disputes to the jurisdiction of Calcutta Court was

negative.

The Supreme Court had occasion to consider the question A.B.C. Laminart Pvt. Ltd. and Another Vs. A.P. Agencies, Salem, . The contract

in that case contained the following clause:

Any dispute arising out of this sale shall be subject to Kaira Jurisdiction.

The Supreme Court held that the jurisdiction of the Court at Salem was not excluded by the said clause. The relevant passages in the Judgment are

as follows:

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. If out of the two jurisdictions one was excluded by Clause 11 it would not absolutely oust the jurisdiction of

the Court, and, therefore, would not be void against public policy and would not violate Ss. 23 and 28 of the Contract Act. The question then is

whether it can be construed to have excluded the jurisdiction^ of the Court at Salem. In the clause any dispute arising out of this sale shall be

subject to Kaira Jurisdiction '' ex facie we do not find exclusive words like ''exclusive'', alone, ''only'' and the like. Can the maxim'' expression unius

est exclusion alterius be applied under the facts and circumstances of the case? The order of confirmation is of no assistance. The other general

terms and conditions are also not indicative of exclusion of other jurisdictions. Under the facts and circumstances of the case we hold that while

connecting factor with Kaira jurisdiction was ensured by fixing the situs of the contract within Kaira, other jurisdictions having connecting factors

were not clearly, unambiguously and explicitly excluded. That being the position it could not be said that the jurisdiction of the Court at Salem

which court otherwise had jurisdiction under law through correcting factor of delivery of goods threat, was expressly excluded.

In the present case, nothing has been placed before us to warrant an inference that the parties intended to exclude the jurisdiction of Courts in

all places other than Bangalore. Hence, we confirm the finding of the trial court on the question of jurisdiction.

It is argued by the learned counsel for the appellant that the Court below is in error in granting interest at the rate of 15% per annum.

According to the learned counsel, there is no contract to pay interest. There is no merit in this contention. S. 61 of the Sale of Goods Act, 1930,

provides that in the absence of a contract to the contrary, the Court may award interest at such rate as it thinks fit on the amount of the price to the

seller in a suit by him for the amount of the price from the date of the tender of the. goods or from the date on which the price was payable. In the

present case, the date of despatch of the goods was on 15.9.1976 and the price was payable immediately to the seller. The rate fixed by the

learned trial Judge is really much lower than what ought to have been granted. This is a commercial transaction and interest could have been

granted at least at the rate of 24% per annum. But, there is no memorandum of cross-objection by the plaintiff. Hence, we confirm the decree of

the trial court granting interest at 15% per annum and not enhancing the rate In the result, the appeal fails and is dismissed with costs.