Patel Bros. vs Vadilal Kashidas Ltd.

Ramachandra Iyer, J.—This is a revision petition filed at the instance of the plaintiffs in S. C. S. No. 7610 of 1956, on the file of the Small

Cause Court at Madras. The suit is for recovery of a sum of Rs. 281/4/0 as damages for breach of contract for nondelivery of goods contracted to

he sold by the defendants. The plaintiff, a firm carrying on business at Madras entered into a contract for the purchase of one bale of cotton cloth

with the defendants.

The defendant is a limited liability company carrying on business at Bombay. According to the plaintiffs delivery was to be made at Madras. The

defendants contested the claim and one of the objections was that the Madras court had no jurisdiction over the subject-matter of the suit Beyond

filing the contract Ex. P. 1, Ex. P. 2 being a translation of a portion of Ex. P. 1, which is in Hindi, no other evidence was let in, in the case.

The learned Judge held that a part of the cause of action arose at Madras and that therefore the suit would be entertainable by the Madras Court.

But referring to a statement at the top of Ex. P. 1 which contained the words, ""Subject to Bombay jurisdiction,"" he held that there was a contract

excluding the jurisdiction of the Madras Court and investing the same only upon the Bombay Courts. In that view he held that the suit was not

maintainable at Madras and returned the plaint for presentation to the proper court.

The plaintiffs have come forward with this civil revision petition against that order. Ex. P.1 a bill issued by the defendant to the plaintiff is stated to

evidence the contract. At the top of the bill words ""Subject to Bombay jurisdiction"" are mentioned and underlined. Thereafter the name of the

defendant firm, address etc., are given and the document runs as follows : Purchaser : Patel Brothers. The undernoted goods -- Ready/forward am

sold on the conditions mentioned overleaf : 7 Godown Street, Madras,

One Bale at Rs. 0/15/6 per yard. Medium. To be despatched to Madras by goods train. Then (it is signed by some person on behalf of the

defendant. It is admitted that the contract was entered into at Bombay and the defendants ate carrying on business at Bombay, There is however a

controversy as to where the cause of action or a part of it arose. Having regard to the fact that the contract was made at Bombay, it cannot be

held that the whole of the cause of action arose at any other place.

The only question is whether a Part of the cause of action arose at Madras. Mr. Keshavlal Tarwady appearing for the defendant has contended

before me that no part of the cause of action arose at Madras and that the finding of the lower Court in that regard is erroneous. I am unable to

agree with this contention. There is nothing to indicate in the contract itself that the delivery was to he made at Bombay. The document stated that

the goods were to be dispatched to Madras and specific mention is also made to ""No. 7, Godown Street, Madras.

Presumably that was the place where the goods were to be consigned. There is no evidence as to how the price was to be realised by the

plaintiffs. The usual procedure followed by the merchants is despatch the goods and then send a railway receipt to their own bankers who would

collect the money against the delivery of the railway receipt. In such a case the property does not ordinarily pass to the purchaser before he paid

the money.

There is no evidence in the case as to the method adopted for tho payment of the price. Nor is there any evidence to show as to when the pro-

perties in the goods were, intended to pass to the buyer. The averments in the plaint would seem to suggest that the delivery was intended to be at

Madras. That is consistent with the terms of Ex. P.1. Mr. Keshavlal Tarwady refers me to paragraph 3 of the plaint in this connection and says that

it should be implied that delivery was intended to be at Bombay.

There is no warrant either in the pleading plaint or in the evidence for such a suggestion. Paragraph 3 of the plaint does not either expressly or

impliedly admit that delivery was intended to take place at Bombay. I am, therefore, of the opinion that the learned Small Cause Judge is right

when he held that part of the cause of action arose at Madras. The question then is, whether under the agreement between the parties there is an

exclusion of the jurisdiction of the Madras Court. On behalf of the respondents reliance is placed upon the decision in Hoosen Kasam Dada

(India) Ltd. v. Motilal Padampat Sugar Mills Co. Ltd., 1954 1 M.L.J..434. That was a case where the terms of the contract contained this clause

All disputes in respect of this contract shall be settled by arbitration failing which shall be settled in the court of seller""s jurisdiction where this

contract shall be deemed to have been entered into.

The learned Judges held that

Where there are two competent courts which can deal with the subject-matter of a litigation, it is open to the parties to a contract to agree that

disputes in respect thereof should be adjudicated upon by one of the two competent courts and such on agreement is perfectly legal and not

contrary to Section 28 of the Contract Act.

As may be seen from the terms of the contract in that case, that was a case where there was a specific mention in the contract itself that one court

shall have jurisdiction and the other courts shall not have such a jurisdiction. Mr. Keshavlal Tarwady in a strenuous argument contended that the

mention of ""Bombay jurisdiction"" impliedly meant an exclusion of the jurisdiction of the Madras Court and referred me to the decision in A. K.

Kaliappa Chettiar and Sons v. Currimbhoy Laljee Sajun and Co., AIR 1954 Trav-Co. 461.

That was a case in which there was a clause in a Bill of Lading stating that Bombay Courts alone shall have jurisdiction. The learned Judges held

that such an agreement was not void u/s 28 of the Indian Contract Act. Even in that case there was a specific; exclusion of all other courts except

the Bombay Court. In the present case there is no such exclusion.

Ex. P. 1 says that the transaction is ""subject to Bombay Jurisdiction."" But it does not exclude the jurisdiction of any other court. In my opinion

ouster of jurisdiction of a court to which a person is entitled to resort to under the CPC or any other statute cannot be a matter of assumption or

presumption but one to be proved by express words contained in the contract or at least by necessary or inevitable implication. It cannot be said

that this test is satisfied in this case.

On the other hand I find a decision of Bala-krishna lyer, J. in Hemchandra Sahu v. Sirdarmall Kesarimal and Co., C. R. P. 1010 of 1953, wherein

the learned Judge has held in an almost identical situation that the jurisdiction of the Madras Court cannot be taken away because in the letterhead

of the defendant he had printed the words ""subject to Berhampur jurisdiction."" The learned Judge held that those words were not sufficient to

constitute a contracting out of the jurisdiction of the Madras Court.

I respectfully agree with that view. I am also of the opinion that the mere printing of the words ""subject to Bombay jurisdiction"" in Ex. P.1 cannot

amount to a contract that both the parties agreed to have the Bombay as the venue for the settlement of disputes. By way of analogy one may refer

to cases where interest is stated to be payable in the tradesmen bills when goods are sold on credit. Such statements have been held not to amount

to a contract to pay interest : see the decision in C. R. P. No. 260 of 1923 : 47 Mad LJ 41

I am of opinion that that principle would apply to the present case as well. Mr. Keshavlal Tarwady next referred to the decision in M. Sheik

Dawood Rowther Vs. South Indian Railway Co. Ltd. and Another, , where under the agreement the consignor agreed to pay rate according to

goods tariff. By mistake the concession rate which was no longer in force was charged. The contract also provided for the rectification of mistakes.

It was held that it was subject to the tariff rates and that the carrier was entitled to collect higher rate. But that, was a case where there was a

specific agreement saying that the transhipment was agreed to subject to the tariff rates and that would incorporate the tariff rates into the contract.

But in the instant case there is only a question of a mere recital on the top of the bill and it cannot be incorporated as a term of the contract.

In this view the order of the lower Court is not correct and is set aside. The suit will be entertained by the lower Court and disposed of

according to law. There will be no orders as to costs,

Order set aside.