Roshan Singh alias Roshan Lal vs Ranbir Singh Pal

A.L. Vaidya, J.—The present Plaintiff filed a suit for specific performance of the agreement of sale dated 7.5.1990 in respect of land comprised in khata khatauni No. 197/320, khasra No. 2176/1532 measuring 9-5 bighas situated in village Nalva mauza & Tehsil Kasauli, Distt. Solan and in the alternative for the recovery of Rs. 6,50,000/-alongwith costs and interest @ 18% per annum. This suit has been contested by the Defendants on various pleas.

The detail of the pleadings is not required to be referred for the purpose of the present order. The parties were put to trial on the following issues, arising out of their pleadings:

Whether this Court has no jurisdiction to take cognizance of the suit as alleged in para 7 of the written statement? OPD.

Whether the suit is not maintainable in view of the Provisions of Order 2 Rule 2 and Rule 3 of the CPC as alleged ? OPD.

Whether there exists no privity of contract in between the parties to the instant lis and thereby the Plaintiff has no locus- standi to institute the instant suit, as alleged? OPD.

Whether the Plaintiff has got no enforceable cause of action in view of the provisions of the H.P. Tenancy and Land Reforms Act, 1972, as alleged ? OPD.

Whether the Plaintiff has always been ready and willing to perform his part of the contract and entitled to specific performance of the contract in question ? OPD.

In case issue No. 5 is decided in the affirmative, whether the Plaintiff is entitled to damages alternatively as alleged ? OPP.

Whether the Defendant is entitled to forfeit the earnest money as per the terms and condition of the contract as alleged? OPD.

Relief.

The suit was ordered to be fixed for the evidence of the Plaintiff and the evidence had not yet been recorded when the Defendant preferred OMP 222/1995 with the prayer that issue No. 1 be tried as preliminary issue. This application was allowed vide order dated 24.7.1995 passed by this Court.

This application was allowed as evidence was not required to be adduced by the parties under this issue and to that effect the circumstances pleaded were not disputed.

After hearing the parties and going through the record, my findings on this issue No. 1 are detailed as under:

Issue No. 1

Paras 7 of the plaint as well as written statement are being reproduced hereunder for the sake of convenience:

Paras 7 of the plaint as well as written statement are being reproduced hereunder for the sake of convenience:

Para 7 of the plaint -

That this Court has jurisdiction to try the suit as the property is located within the limits of this Hon''ble Court and Defendant works and resides for gain within the limits of this Hon''ble Court.

Para 7 of the written statement -That the contents of para 7 of the plaint invoking jurisdiction of this Hon''ble Court for the trial of the suit is not legally tenable and hence denied. On the face of the alleged agreement set up by the Plaintiff, which is the main base of the Plaintiff''s case, it is specifically mentioned in Clause No. 10 of the alleged agreement that any dispute arising out of the bargain, shall fall within the jurisdiction of courts at Chandigarh only, thus creating a complete ouster and bar of jurisdiction of this Hon''ble Court. Accordingly, the suit cannot proceed in this Hon''ble Court and deserves dismissal on this score alone.

Admittedly, the agreement for sale dated 7.5.1990 pertaining to the land under reference was executed at Chandigarh. Clause 10 of the agreement which would be relevant to dispose of the present issue runs as under:

That if any dispute arises out of this bargain, the same shall fall within the jurisdiction of the Courts at Chandigarh only.

6(A) On the basis of the aforesaid clause, it has been very strongly argued on behalf of the Defendant that as a part of cause of action has arisen at Chandigarh, therefore, u/s 20(c) of the CPC , the Court at Chandigarh would also have jurisdiction to try the present suit and on the basis of Clause 10 of the agreement, parties have, by an agreement, submitted to the jurisdiction of Courts at Chandigarh alone in case of any dispute arising out of the aforesaid agreement. According to learned Counsel, in such an eventuality as the parties have agreed, various Courts have held that where two Courts have jurisdiction to try a suit, parties by agreement can limit the jurisdiction to one Court alone and in that event, that Court, agreed to, shall have the jurisdiction to try the suit. In this background, it is being submitted that the Court at Chandigarh only shall have the jurisdiction to try the suit of the present nature. It is not so simple a matter as has been contended on behalf of the Defendant.

In order to get support in favour of the Defendant''s case, learned Counsel for the Defendant has relied upon certain case law which is referred here in below:

In M/s. Angile Insulations Vs. M/s. Davy Ashmore India Ltd. and another, the following observations of the apex Court would be very much relevant:

Civil Procedure Code, 1908 Section 20 Territorial jurisdiction of Court Normally lies where cause of action arises - But it will be subject to terms of a valid contract between the parties - Where two courts having jurisdiction consequent upon a part of the cause of action arising therewith, if parties stipulate in the contract to vest jurisdiction in one such court to try the disputes arising between themselves and if the contract is unambiguous, explicit and clear and is not pleaded to be void and opposed to Section 23 of the Contract Act, then suit would lie in the court agreed to by the parties and the other court will have no jurisdiction even though cause of action arose partly within the territorial jurisdiction of that Court.

In M/s. Patel Roadways Limited, Bombay Vs. M/s. Prasad Trading Company, , it has been held by the apex Court that u/s 20(a) to (c) CPC , the choice of forum can be limited by incorporating exclusion clause under the agreement. It has further been held that agreement cannot confer jurisdiction on a place it does not lie otherwise.

A.B.C. Laminart Pvt. Ltd. and Another Vs. A.P. Agencies, Salem, Salem has also been cited by the Defendant. The ratio of this ruling has been followed in M/s. Angile Insulations Vs. M/s. Davy Ashmore India Ltd. and another,

From the aforesaid ratio laid down by the Supreme Court of India, it has been settled that where two Courts have jurisdiction to try a suit of particular nature, parties could limit the jurisdiction by agreement to one Court alone also, but such an agreement cannot and will not confer jurisdiction on a place or to a Court which has no jurisdiction to try such a suit. Section 20 CPC has also been made the base for the same.

In the present case, if it is held that Court at Chandigarh shall have also jurisdiction to try the present suit, definitely the agreement arrived at between the parties in this particular behalf, shall prevail. This agreement will have no legal bearing at all in case it is held that Courts at Chandigarh on the basis of the admitted facts will have no jurisdiction to try the present suit and in that event, agreement of the parties cannot confer such a jurisdiction.

Section 20 CPC starts with the wording " subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction". This Section 20 deals with other suits to be instituted where Defendant resides or cause of action arises. The words " other suits'' and the words "subject to the limitations aforesaid" have some role to play in determining the jurisdiction of the Court. "Other suits" and " subject to limitation aforesaid" mean the suits which are not covered under the earlier provisions of the Code of Civil Procedure. Section 20 CPC has to be read with the aforesaid rider with it. It does not envisage all types of suits to be covered under this provision of law.

Section 15 - 19 are the provisions which are the limitations/riders to the applicability of Section 20 CPC .

Section 15 CPC provides that every suit shall be instituted in the Court of lowest grade competent to try it.

Section 16 CPC is very much relevant to be taken note of in order to dispose of the present controversy, which runs as under:

Suits to be instituted where subject matter situate-

Subject to the pecuniary or other limitations prescribed by any law, suits-(a) for the recovery of immovable property with or without rent or profits,

(b) for the partition of immovable property,

(c) for foreclosure, sale or redemption in the case of a mortgage of or charge upon immovable property,

(d) for the determination of any other right to or interest in immovable property,

(e) for compensation for wrong to immovable property,

(f) for the recovery of movable property actually under distraint or attachment, shall be instituted in the Court within the local limits of whose jurisdiction the property is situate:

Provided that a suit to obtain relief respecting, or compensation for wrong to, immovable property held by or on behalf of the Defendant may, where the relief sought can be entirely obtained through his personal obedience, be instituted either in the Court within the local limits of whose jurisdiction the property is situate, or in the Court within the local limits of whose jurisdiction the Defendant actually and voluntarily resides, or carries on business, or personally works for gain.

Section 17, 18 and 19 deal with other situations.

Section 16(d) provides that a suit for the determination of any other right to or interest in immovable property shall be instituted in the Court within the local limits of whose jurisdiction the property is situate.

Admittedly, the subject matter of the suit which is the landed property is situated in Solan District of Himachal Pradesh. The prayer clause of the suit runs as under:

It is, therefore, prayed that

(a) a decree for specific performance of the agreement of sale executed on 7.5.1990 by Defendant may be passed in favour of the Plaintiff and against the Defendant directing the Defendant to execute and register the sale deed of the land measuring 9-5 bighas in village Nalwa, Mauza Kasauli, Pargana and Teh. Kasauli, Distt. Solan comprised in Khata Khatauni No. 197/320, Kh. No. 2176/1532, according to the jamabandi for the year 1987-88 and the Plaintiff be put in possession of the same; and received balance sale consideration

(b) In the alternative, grant a decree for recovery of Rs. 6,50,000/- on account of damages and refund of earnest money alongwith interest 9 18% per annum from the date of suit till realisation;

(c) The Plaintiff be also allowed the costs of suit and such other Interim relief which the Court in the facts and circumstances of the case deems fit and proper.

That means, the main relief of the Plaintiff, asked for, is for a decree for specific performance of the agreement of sale executed on 7.5.1990 by Defendant, directing the Defendant to execute and register the sale deed of the suit land and the Plaintiff be put in possession of the same. So, Indisputably the present suit pertains to the determination of any other right to or interest in immovable property as provided u/s 16 CPC . On the basis of this provision, which is a limitation to Section 20 CPC , the suit has to be instituted in the Court within the local limits of whose jurisdiction the property is situate and the subject matter of the suit is situated within the local limits of the jurisdiction of this Court and, therefore, this Court shall have jurisdiction to try the suit.

It has been contended that for the alternative prayer as damages and refund of earnest money, a decree for Rs. 6,50,000/- has been asked for which is independent of any right or interest in the immovable property and with that background, as part of cause of action has arisen at Chandigarh, therefore, that Court shall have jurisdiction to try the suit for the said relief. Here again, at first instance, it may be pointed out that this amount has been asked for violation of an agreement arrived at between the parties for the sale of immovable property, meaning thereby that it is the interest or right created in the immovable property by way of agreement that this amount is asked for and in this view of the matter also, the jurisdiction of this Court shall be there u/s 16(d) of CPC , as referred to earlier.

However, on the other hand, even if it is assumed that for the purpose of recovery of the aforesaid amount, a part of cause of action has arisen at Chandigarh and Section 16(d) shall have no applicability, even then, as the principal relief can be granted by this Court, the alternative relief otherwise can also be granted by this Court having independent jurisdiction in case the suit had been for the recovery of damages alone. In a case of present nature, where the jurisdiction to grant primary relief is with this Court and otherwise the alternative relief can also be granted by this Court, to try the entire suit would be within the jurisdiction of this Court. In this view of the matter also, the Defendant''s plea does not carry any legal weight whatsoever.

AIR 1986 Patna 57, Ananda Bazar Patrika Ltd. and Ors. v. Biswanath Prasad Maitin can safely be referred, Para 6 of this judgment runs case under:

So far the present case is concerned the Plaintiff has specifically prayed not only for specific performance of the contract but also for being put in possession over the property in suit. Such a suit is covered by Section 16(d), Civil P.C. and not Section 20(c) of the Code as has been held by the learned Subordinate Judge. The property in the present case is situate at Jasidih which is outside the jurisdiction of Patna Court. The Patna Court, in my view, has obviously no jurisdiction to try such a suit.

In Trustees for Improvement of Calcutta Vs. Bahadur Khan and Others, though the facts were quite distinct but the following observations would be helpful for the disposal of the present issue:

Where an award for the acquisition of property of the Plaintiff situated beyond the territorial jurisdiction of the City Civil Court of Calcutta was made at the office of the Land Acquisition Collector within the jurisdiction of the City Court and the application of the Plaintiff u/s 78 of Calcutta Improvement Act for abandonment of a portion of the premises which was not required for the execution of the Scheme was rejected by the Authority at his office which was also in the jurisdiction of the City Court on the Plaintiff filing a suit in the City Civl Court of Calcutta it was held that the Plaintiff wanted a determination as to his right and status in regard to the property in dispute and on that basis questioned the propriety of the notice u/s 9 of the Land Acquisition Act being issued in the name of a person in whose name the tenancy of disputed property originally stood and, therefore, the forum should be determined u/s 16 of the CPC Clause (d) whereof completely covers a situation like this and the suit has to be instituted in the Court within the local limit of whose jurisdiction the property is situate and the suit having come within the meaning of Section 16 the Plaintiff could not file the suit elsewhere with the aid of Section 20 CPC Therefore, it could not be said that since a part of the cause of action by making the award arose within the jurisdiction of City Civil Court, Calcutta that Court had jurisdiction to try the suit.

In State of Bank of India Vs. O.P. Gupta and others, it has been held as under:

Where a suit was filed by a Bank on the Original Side at Delhi High Court for the recovery of certain sums based on cash credit facilities granted to the customer and the customer had also deposited the title deeds in respect of house property situate at Mathura for the purpose of furnishing a guarantee as collateral security for the advance, the suit was liable to be dismissed for want of jurisdiction, as the provisions of Section 16 of Civil P.C. would apply and, accordingly, suit could be filed at Mathura only where the property was situate.

Thus, on the basis of the aforesaid discussion and the case law referred to above, only this Court shall have jurisdiction to try the suit and the agreement arrived at between the parties limiting the jurisdiction and conferring the same to Chandigarh Court shall have no bearing whatsoever in the background of the circumstances present in this case. This issue is accordingly decided against the Defendants.

The suit be now listed for evidence of the Plaintiff, on the date to be fixed by the Registrar (V).