High CourtsSingle Bench

Splendor Landbase Limited vs Mirage Infra Limited and Another

Delhi High Court · Decided on 8 February 2010 · Citation: (2010) 02 DEL CK 0346

HON’BLE JUDGES
S. Ravindra Bhat, J
ACTS & SECTIONS REFERRED
Arbitration Act, 1940 — Section 14, 15, 16, 2, 30 · Civil Procedure Code, 1908 (CPC) — Order 7 Rule 10, Order 7 Rule 10A, 15, 16, 17
RESULT
Allowed
CASE NUMBER
CS (OS) 582 of 2009 and I.A. No''s. 4085, 4614 and 8035 of 2009
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Judgment

41 paragraphs · 5,326 words

S. Ravindra Bhat, J.—This common order will dispose of the two applications - I.A. No. 4614/2009 filed by the defendant, seeking rejection of the suit and I.A. No. 4085/2009, by the plaintiffs seeking ad interim temporary injunction.

2.

The facts, according to the suit, are that the plaintiff, a Delhi based company entered into an agreement dated 24.9.2008 with the defendant (here called the MIRAGE). The latter is a Chandigarh based company. The subject matter of the agreement (hereafter called "the TERM SHEET") was land measuring approximately 3.97 Acres (the suit land), situated in Chandigarh. The parties agreed to develop the suit land after securing the requisite approvals and conversion permission from the concerned local authorities. The material conditions of the term sheet read as follows:

1.

The second party shall bear the cost of CLU charges along with requisite fees and charges to the Competent Authority (ies) and construction cost of the building for developing the Proposed Project.

2.

That the parties agree to share the Net Revenue from sale of saleable built up area of the proposed project as under:

First Party : 48% and Second Party : 52%

3.

That the Second Party shall recover from the First Party''s later''s share of revenue a sum of Rs. 10,00,00,000/- (Rupees Ten Crores only) towards cost of brokerage and expenses incurred towards marketing, branding, publicity, promotional events, brochure, advertisements in newspapers, hoardings, etc. of the Proposed Project.

4.

That the Second Party will facilitate the sale of saleable proposed built up area and from the First Party''s share of Sale Proceeds the First Party shall first repay towards Rs. 35 Crore (Rupees Thirty Five Crore) loan taken by the First Party from Canara Bank for purchase of the Said Land. The Second Party may contribute from its share of revenue of sales as may be required to achieve the repayment of half of loan by 15th January, 2009 and balance by 31st March, 2009. It will be the sole responsibility of the second party whatsoever.

5.

That the Second Party has paid to the First Party a Non refundable security deposit of Rs. 2,51,00,000/- (Rupees Two Crores Fifty One Lacs only) vide cheque No. 000675 dated 24th October, 2008 drawn on HDFC Bank Limited, Jasola, New Delhi on signing of this Term Sheet, the receipt of which the First Party hereby confirms and acknowledges.

6.

That the Second Party has also paid a sum of Rs. 5,71,47,013/- (Rupees Five Crores Seventy One Lacs Forty Seven Thousand Thirteen Only) vide cheque No. 000674 dated 24th October, 2008 drawn on HDFC Bank Limited, Jasola, New Delhi to the First Party towards reimbursement of CLU charges which has been deposited by the First party with the designated authority, and PDC for the balance CLU cheques will be given.

7.

That the Second party shall be entitled to raise/swap the loan from banks/financial institutions by mortgaging or charging the Proposed Project.

3.

The plaintiff states that it paid a sum of Rs. 2.51 Crores on 3.11.2008 as non-refundable security and further more charges of Rs. 5,71,47,013/- through a cheque dated 24.10.2008. The total amount thus paid to the defendant was Rs. 8,22,47,013/-. It is contended that the plaintiffs could not undertake sales and marketing of such portions of the suit land as could be disposed of on account of the defendant not furnishing the General Power of Attorney to it. Also building plans were not sanctioned by the competent authority. It is submitted that the plaintiff secured loans from the Canara Bank. The suit alleges that the defendant is obliged to obtain the sanctions for the proposed building to be constructed on the suit land, but did not do so. Originally, the suit lands were meant for industrial use, but they had, according to the plaintiff, been converted to commercial use. It is stated in paragraph-20 that according to the understanding of the parties, the plaintiffs were to be in joint possession of the suit lands, along with the defendants. It is alleged that the defendants, after availing loan of Rs. 35 Crores from Canara Bank and having obtained Rs. 8 Crores from the plaintiffs were trying to create third party rights, as on 23.04.2009. The plaintiffs submit that since they have real and substantial interest in the property, development of which was agreed expressly through the term sheet dated 24.09.208, the defendants cannot create third party rights, which would defeat their (plaintiff''s) rights in the fulfillment of the project, the profits which were to be shared according to an agreed ratio. It is alleged that the defendant''s conduct amounts to defrauding the plaintiff''s interest and rights. In the circumstances, the plaintiffs seek a decree of declaration that the term sheet dated 24.09.2008 continues to bind the defendant and seeks a perpetual injunction against the defendants or any one acting on their behalf from creating third party rights in respect of the suit lands.

4.

In support of the suit, the plaintiff has filed a copies of the two cheques issued in favour of the defendant; it also relies upon copy of an e-mail communication dated 24.03.2009, issued by the second defendant, proprietor of one M/s Navyug Properties, indicating that the suit lands were available for sale. They have also produced a copy of the letter dated 22.12.2008 issued by the Chandigarh Administration to MIRAGE communicating that the permission for conversion of the land use was granted, on payment of Rs. 57.14 Crores. Paragraph-5 of that letter stated that a sum of Rs. 5,71,47,713/- paid through cheque drawn on Canara bank, Chandigarh, was adjusted towards the first installment of such fee.

5.

On the strength of the above allegation, the plaintiffs seek a temporary injunction to restrain the defendants MIRAGE from creating third party rights or dealing with the property in a manner prejudicial to its (the plaintiffs'') interest, as disclosed in the term sheet.

6.

In the application, seeking rejection of the Suit, the defendants submit that this Court lacks territorial jurisdiction and that the plaint also does not disclose any cause of action. It is contended that what is claimed in the suit, pertains to immovable property rights since the subject matter of the term sheet is immovable property. The injunction directly relates to enjoyment of ownership of such immovable property rights. Since the suit property is located at Chandigarh, the present suit is not maintainable at Delhi. It is also contended that the term sheet was not executed in Chandigarh but in Delhi. The first defendant further argues that the second defendant is merely a property dealer, who had negotiated with the plaintiffs with respect to the suit land. It is also urged that the term sheet expressly provided that the plaintiff had to make payment by 15.1.2009 and the remaining balance by 31.3.2009 and that no amounts has been received by the first defendant. The suit is termed as an abuse of process of law and an attempt to grab the interim order by any means. The defendants'' Counsel relies upon the judgment reported as Harshad Chiman Lal Modi Vs. D.L.F. Universal Ltd. and Another, , where it was observed as follows:

26.

The question, however, is whether Delhi Court has jurisdiction in the matter. If the answer to that question is in the affirmative, the contention of the plaintiff must be upheld that since Delhi Court has also jurisdiction to entertain the suit and parties by an agreement had submitted to the jurisdiction of that court, the case is covered by Section 20 of the Code and in view of the choice of forum, the plaintiff can be compelled to approach that court as per the agreement even if other court has jurisdiction. If, on the other hand, the contention of the defendant is accepted and it is held that the case is covered by Section 16 of the Code and the proviso to Section 16 has no application, nor Section 20 would apply as a residuary clause and Delhi Court has no jurisdiction in the matter, the order impugned in the present appeal cannot be said to be contrary to law. As we have already indicated, the suit relates to specific performance of an agreement of immovable property and for possession of plot. It is, therefore, covered by the main part of Section 16. Neither proviso to Section 16 would get attracted nor Section 20 (residuary provision) would apply and hence Delhi Court lacks inherent jurisdiction to entertain, deal with and decide the cause.

36.

In New Mofussil Co. Ltd. and Anr. v. Shankerlal Narayandas Mundade, almost a similar question came up for consideration before the High Court of Bombay. In that case, a suit for specific performance of contract and possession of immovable property situated at Dhulia was filed in the Court of First Class Subordinate Judge, Dhulia against defendant No. 1 - Company in liquidation. The registered office of the Company was in Bombay and the agreement was finally concluded in Bombay. It was, therefore, contended that Dhulia Court had no jurisdiction to try the suit. It was, however, held by the High Court that the case was covered by Clause (d) of Section 16 of the Code, the Proviso had no application and since the property was situated at Dhulia, Subordinate Judge, Dhulia had jurisdiction to entertain and try the suit. See also Anand Bazar Patrika Ltd. v. Biswanath Prasad Maitin.

7.

The defendant also relies upon the decision of the Division Bench of this Court reported as Vipul Infrastructure Development Ltd. v. Rohit Kocchar FAO(OS) 196-197/2005 decided on 11.3.2008, in support of the submission that the Court lacks territorial jurisdiction by reasons of Section 16 of the Code of Civil Procedure.

8.

The plaintiffs resist the application for rejection of the Suit. Its Learned Counsel relies upon the decision of the Supreme Court reported as Jatinder Nath v. Chopra Land Developers (P) Ltd. and Anr. (2007) 11 SCC 453. The Supreme Court had to deal with a similar agreement whereby parties had decided to develop the land located at Delhi. The objection as to jurisdiction of the Court was on account of the fact that the award was sought to be filed in Faridabad Court. The Supreme Court held that the Delhi Court did not have jurisdiction, and held that the Faridabad Court had jurisdiction and observed as follows:

15.

On the first question on the lack of territorial jurisdiction, we do not find any merit in the contentions advanced on behalf of the appellant. We have examined Ex. P-1 between the appellant and the builder (Developer) dated 16.3.1990. The agreement describes the appellant as the owner. It describes M/s Chopra Land Development Pvt. Ltd. as the builder. Under the agreement, the appellant remains the owner. Under the agreement, the appellant applies to D.D.A. for time to construct a housing complex on a plot of land at Saket owned by the appellant. Under the agreement, the Developer agrees to construct a housing complex on the plot bearing No. G-13, Saket, New Delhi. Under the agreement, the entire construction cost is financed by the Developer. Under the agreement, the housing complex consisted of basement, ground floor, mezzanine first floor, second floor and third floor. Under the agreement, the Developer agreed to construct the housing complex without prejudice to the owner''s right. Under the agreement, the owner was required to give permission to the builder to construct the housing complex. Under the agreement, the entire cost of construction was to be borne by the Developer. Under the agreement, the building plan, the completion certificate etc. were to be signed by the appellant-owner. Under the agreement, vide Clause 15, the Developer agreed to pay to the appellant-owner a sum of Rs. 5 lacs in consideration of his seeking permission to construct the housing complex. This was in addition to the construction cost to be incurred by the Developer. Clause 16 of the agreement stated that in consideration of the Developer''s services to construct the housing complex, the appellant agrees to allow the ownership of the basement, ground floor and mezzanine along with proportionate interest in the land to be transferred in the name of the Developer. At this stage, it may be noted that under the ex parte Award dated 29.3.1994 the arbitrator has passed his Award in terms of para 16 and, therefore, it was contended before us on behalf of the appellant that the dispute related to possession of the property; that the dispute was comparable to a suit for land and that the submission was made specifically in view of the Award being passed in terms of para 16 of the agreement (Ex. P-1). It was urged that since the arbitrator has passed the Award directing the appellant to transfer the ownership of basement, ground floor, mezzanine along with the proportionate interest in the land in favour of the Developer, the present dispute related to recovery of possession and since the lands were located in Saket the trial court had no jurisdiction to make the Award rule of the court u/s 14 of the Act. As stated above, we do not find merit in the contention advanced on behalf of the appellant. We have examined Ex. P-1 in entirety. Apart from the above Clauses of Ex. P-1, we have already quoted Clauses 11, 20, and 21 by which the parties agreed that in case of dispute between the parties the same shall be referred for arbitration to the sole arbitrator at Faridabad and his decision shall be binding on both the parties. Under Clause 21, the parties agreed that the Faridabad court alone shall have the jurisdiction in case of any dispute between the parties. On our examining the terms and conditions of Ex. P-1 along with the surrounding circumstances thereto, we are of the view that Ex. P-1 was a pure Development Agreement. The agreement is merely an agreement whereby a party agrees to develop certain property for a certain consideration. Under the agreement, the appellant herein continues to remain the owner. He has to apply for permission to construct the building to the D.D.A. The Developer agrees to construct on the land. The Developer agrees to finance the entire construction cost and in lieu of the Developer''s services in the matter of construction of housing complex the owner (appellant herein) agrees to permit transfer of the ownership a part of the complex to the Developer. It is for this reason, as indicated by the events enumerated above, that M.C.D. had issued notice to the appellant on 21.9.1992 to show cause why the building plan submitted should not be revoked. It is for the above reasons, that M.C.D. ultimately revoked the sanction for the construction of the housing complex on 18.5.1993 and it is the appellant herein as owner who had sought to challenge the revocation vide Writ Petition No. 5038/93. On the facts of this case, therefore, it cannot be said that the trial court at Faridabad had no jurisdiction to make the Award the rule of the court u/s 14 of the Act. Section 31(1) of the Act provides that an Award may be filed in any court having jurisdiction in the matter to which the reference relates. Under that section, the Award can be filed in the court within whose jurisdiction the property in dispute lies. Parties cannot give jurisdiction to a court u/s 14 by consent if that court does not has jurisdiction. If an award refers to an immovable property, the court having jurisdiction in respect of the same will entertain an application u/s 14. In order to decide as to which court has jurisdiction to entertain a petition u/s 14, reference has to be made to Section 2(c) read with Section 31(1) of the Act. Merely because the arbitrator chooses to hold the proceedings in a place where no suit could be instituted, and chooses to make an award at that place, it would not give the court of that place territorial jurisdiction to decide the matter under the Act. Section 30 refers to ground for setting aside an award. Section 30 is to be read with Section 33. The idea behind the entire scheme of the Arbitration Act appears to be that an application by a party challenging the validity of correctness of the award on whatever ground has to be made u/s 33. Section 33 is the only section under which a party is given the right to apply to the court to challenge either the agreement or the award. Under the Act, therefore, after the Award has been filed a party is permitted to make an application u/s 33 to bring all kinds of defects to the notice of the court and the court will give reliefs either u/s 15 or Section 16 or even u/s 30 of the Act. In an arbitration without the intervention of the court, an award can be filed in any court having jurisdiction in the matter to which the reference relates. The award can be filed only in the court which would have jurisdiction in respect of the subject matter of the dispute. In order to decide the jurisdiction of the court, it is necessary to decide whether the court would have jurisdiction to try a regular suit between the parties in which the relief is claimed. Section 33 does not prescribe the court before which an application under this section may be filed, but Section 31 makes such provision. Section 31(2) provides that all questions regarding the validity, effect or existence of an award or an arbitration agreement shall be decided by the court in which the award has been filed or may be filed. Section 2(c) lays down the forum. The application has to be moved in the court within, whose jurisdiction the opposite party resides or carries on business or within whose jurisdiction any part of the cause of action arises. Residence or carrying on business of a party, apart from the place of accrual of a cause of action is relevant for determining the territorial jurisdiction of the court in arbitration cases, if the question so arises in connection with the subject matter of the dispute.

16.

Applying the above tests to the facts of the present case, we are of the view that at the relevant time the appellant resided at Faridabad. He resided at Faridabad when the contract was made. Under the contract, the parties agreed to refer all disputes to the Faridabad court. Apart from the residence, we are also concerned with the place of accrual of the cause of action. In the present case, a bare reading of the agreement indicates that it is an agreement to develop. The appellant remains the owner, the Developer remains the contractor. The Developer is the financer. The appellant is the owner of an asset. The contractor/Developer agrees to exploit that asset on behalf of the owner. The Developer funds the scheme. The building plans remained in the name of the owner. The D.D.A. informs the owner regarding revocation of the building plan. The owner files the writ petition challenging the revocation. The contractor is paid consideration in terms of a part of the property. In the circumstances, it cannot be said that this case is similar to a suit for land. One cannot look at para 16 alone in isolation. On the other hand, with open eyes, the parties had entered into the contract, they had agreed to refer all disputes to an arbitrator at Faridabad and they had agreed that the Faridabad court alone shall have jurisdiction. In a matter of this kind, it cannot be said that the claim is similar to a suit for land. A housing complex has to be constructed at the site. When dispute arises, it will not be confined only to immovable property. Such disputes also require accounts to be maintained. The disputes also involve rendition of accounts. In the circumstances, in our view, Section 20 CPC alone is attracted. Therefore, in our view, the High Court was right in holding that the Faridabad court had jurisdiction to make the Award the rule of the court.

9.

Learned Sr. Counsel appearing for the plaintiffs Mr. Amarjit Singh Chandiok also relied upon the decision reported as A.B.C. Laminart Pvt. Ltd. and Another Vs. A.P. Agencies, Salem, and submitted that since the term sheet was executed by the parties at New Delhi, on a joint reading of an explanation to Section 16 CPC with Section 20, this Court has the jurisdiction to entertain and try the Suit. Reliance was also placed upon the view expressed in Suresh Jain v. Dinesh Kumar Arb.P. No. 489/2007 and O.M.P. No. 641/2007 decided on 30.04.2008. It was submitted that in the said order too, the Court ruled about jurisdiction of the Delhi Court where property was located elsewhere.

10.

The essential facts leading to the filing of this suit are not in dispute. The parties executed the term sheet on 24.09.2008. It in effect is a joint venture or partnership whereby the defendants'' lands located at Chandigarh were agreed to be developed and the proceeds of sale of such developed property were to be shared in an agreed ratio. The plaintiff asserts to having paid a substantial amount of over Rs. 8 Crores and also secured a loan from Canara Bank to take the project further. On the allegation that the defendants were proposing to dispose of the suit lands, the plaintiff seeks a declaration about the binding nature of the term sheet and that it is subsisting. A perpetual injunction to restrain the defendants from creating third party rights is sought. The defendants object to the maintainability of the suit contending that the suit does not disclose a cause of action and also that in any event, the Court lacks territorial jurisdiction.

11.

The Section 16 of the CPC mandates that where a plaintiff seeks any relief pertaining to immovable property, the appropriate Court would be that within the local limits of whose territorial jurisdiction, the property is located. The Explanation to Section 16 carves out an exception in that where the relief can be conveniently claimed in regard to the compensation to wrong to immovable property the Suit can be filed at place where the personal obedience to the decree of the Court can be secured, before the Court which exercises such personal jurisdiction over the defendant.

12.

The relevant discussion in Harshad Chiman Lal Modi case (supra) is as follows:

In the prayer clause, the plaintiff stated;

Therefore, it is most respectfully prayed that in the facts and circumstances stated above, this Hon''ble Court may graciously be pleased to:

a) pass a decree of declaration to the effect that there is a valid and existing contract with regard to plot No. L-31/4, DLF Qutab Enclave Complex, Gurgaon, Haryana, between the plaintiff and the Defendant No. 1;

b) pass a decree to the effect that the Defendant No. 1 is bound to abide by the contract, i.e. plot buyer agreement dated 14.8.85 and the unilateral rescinding/canceling/withdrawing of the contract by the Defendant No. 1 is bad and illegal;

....

Section 16 enacts that the suits for recovery of immovable property, or for partition of immovable property, or for foreclosure, sale or redemption of mortgage property, or for determination of any other right or interest in immovable property, or for compensation for wrong to immovable property shall be instituted in the court within the local limits of whose jurisdiction the property is situate. Proviso to Section 16 declares that where the relief sought can be obtained through the personal obedience of the defendant, the suit can be instituted either in the court within whose jurisdiction the property is situate or in the court where the defendant actually or voluntarily resides, or carries on business, or personally works for gain. Section 17 supplements Section 16 and is virtually another proviso to that section. It deals with those cases where immovable property is situate within the jurisdiction of different courts. Section 18 applies where local limits of jurisdiction of different courts is uncertain. Section 19 is a special provision and applies to suits for compensation for wrongs to a person or to movable property. Section 20 is a residuary section and covers all those cases not dealt with or covered by Sections 15 - 19.

Section 16 thus recognizes a well established principle that actions against res or property should be brought in the forum where such res is situate. A court within whose territorial jurisdiction the property is not situate has no power to deal with and decide the rights or interests in such property. In other words, a court has no jurisdiction over a dispute in which it cannot give an effective judgment. Proviso to Section 16, no doubt, states that though the court cannot, in case of immovable property situate beyond jurisdiction, grant a relief in rem still it can entertain a suit where relief sought can be obtained through the personal obedience of the defendant. The proviso is based on well known maxim "equity acts in personam, recognized by Chancery Courts in England. Equity Courts had jurisdiction to entertain certain suits respecting immovable properties situated abroad through personal obedience of the defendant. The principle on which the maxim was based was that courts could grant relief in suits respecting immovable property situate abroad by enforcing their judgments by process in personam, i.e. by arrest of defendant or by attachment of his property.

....

In the instant case, Delhi Court has no jurisdiction since the property is not situate within the jurisdiction of that court. The trial court was, therefore, right in passing an order returning the plaint to the plaintiff for presentation to the proper court. Hence, even though the plaintiff is right in submitting that the defendants had agreed to the jurisdiction of Delhi Court and in the original written statement, they had admitted that Delhi Court had jurisdiction and even after the amendment in the written statement, the paragraph relating to jurisdiction had remained as it was, i.e. Delhi Court had jurisdiction, it cannot take away the right of the defendants to challenge the jurisdiction of the court nor it can confer jurisdiction on Delhi Court, which it did not possess. Since the suit was for specific performance of agreement and possession of immovable property situated outside the jurisdiction of Delhi Court, the trial court was right in holding that it had no jurisdiction.

13.

Pantaloon Retail India Ltd. Vs. DLF Limited and Others, where the property was located in Gurgaon and the suit sought mandatory injunction in Delhi Court, the Division Bench affirmed the Single Judge''s view that such relief could not be sought in the suit filed in Delhi. In Vipul Infrastructure Developers case (supra) cited on behalf of the defendants, the Division Bench held as follows:

17.

The interpretation that is sought to be given by the respondents herein, if accepted, would in view of the aforesaid decision, lead to an incongruous situation, as a person who is located in Delhi and buys a property in Gurgaon or in Mumbai, would seek for declaration at Delhi and at the execution stage, get the decree transferred to Gurgaon or Mumbai for its execution.

18.

In the present case, it is an admitted position that the appellant had entered into the aforesaid alleged contract at its Corporate office at Delhi. It is the specific stand of the appellant that they were initially residents of Delhi and that they had moved to Gurgaon and their corporate office is now also located at Gurgaon. It is the contention of the Counsel appearing for the respondents that the proviso to Section 16 of CPC is applicable which is sought to be invoked, for, the relief which is sought for could be entirely enforced through the personal obedience of the defendants in Delhi. There is however not only a prayer in the plaint for declaration of the right and title, but also to transfer the right, title and interest in the suit premises situate at Gurgaon. As, in our opinion, the suit can be decreed in favor of the plaintiff only when the Court can get the sale deed executed and registered in favor of the plaintiff which would confer the title of the suit premises on the plaintiff, and the execution and the registration of the sale document would have to take place at Gurgaon and, for this the Court will also have to pass a decree directing the defendant to get the sale deed executed and registered at Gurgaon, implication of the same will be that a direction will have to be given to the defendant that he shall have to move out of Delhi and go to Gurgaon and get the same registered. No sale deed is sought to be registered at Delhi and, therefore, in our considered opinion such a relief cannot be entirely obtained through the personal obedience of the defendant, who in this case has to go to the jurisdiction of another court to get the decree executed and the sale deed registered....

14.

The plaintiff''s contention here is twofold; the sum and substance of the term sheet is a development agreement which does not create any right and interest in the property and that it was executed in Delhi. For supporting the claim for this Court''s jurisdiction, reliance is placed in ABC Laminart case (supra). While the contention in a normal situation is unexceptionable that such Court''s jurisdiction can be suitably invoked where the cause of action or a part of cause of action arose, nevertheless, one has to be conscious about the fact that the Section 20 is a residual provision which applies if the other provisions are not attracted. The nature of the relief claimed is a declaration that the term sheet subsists. However, that is not the end of the matter. The context and the subject matter of the term sheet are the rights and obligations of the parties in relation to the immovable property which is located at Chandigarh. Most importantly, a permanent injunction is sought by the plaintiffs to restrain the defendants from dealing with or creating third party rights in respect of such suit property (located at Chandigarh). This relief clearly pertains to and is expressly in respect of immovable property. The defendant does not reside or have any office in Delhi so as to fall within Explanation to Section 16. In these circumstances, this Court is of the opinion that the argument about the term sheet having been executed in Delhi being sufficient to cloth the Court with territorial jurisdiction, is insubstantial.

15.

So far as reliance placed on Jitender Nath case is concerned, although there are some elements in that decision which might favour the position taken that this Court has jurisdiction, to entertain the suit, significantly, the Supreme Court rested its reasons largely on the fact that the agreement itself stated that arbitration was to be conducted in Faridabad, an award was made pursuant to such clause and consequently the Faridabad Court was approached. These distinctive features single out the ruling in Jitender Nath which cannot be considered as a view over ruling the judgment in Harshand Chiman Lal Modi.

16.

For the above reasons, this Court is satisfied that the defendants'' application objecting to the territorial jurisdiction of the Court has to succeed. However, this is a case where the power of the Court to be exercised is not for rejection of the plaint but for its return in view of Order 7, Rule 10 CPC.

17.

I.A.-4614/2009 is accordingly allowed.

18.

CS (OS) 582/2009 and all other pending applications are, therefore, disposed of as returned, to be filed before the Principal District Judge at Chandigarh in terms of Order 7, Rule 10A CPC. Parties are directed to be present before the said court on 8th March, 2010.