CRP 283/2008 BEFORE THE HON’BLE MR JUSTICE IA ANSARI The moot question, raised in this revision, is whether a suit can be instituted against a corporation in a Court, within whose local jurisdiction a subordinate or branch office of the corporation is located, irrespective of the fact as to w hether the ’cause of action’, or part thereof, had or had not arisen within the limits of the territorial jurisdiction of the Court ? 2. The question, posed above, has arisen in the backdrop of the facts as ma y be briefly put as under: 3. The opposite-party herein instituted Money Suit No. 72/2005 in the Court of the Civil Judge, Senior Division No. 2, Kamrup, Guwahati, seeking, inter ali a, a declaration that the plaintiff is entitled to receive from the defendantss a sum of Rs. 21,37,000/- with interest accruing thereon, the principal defendan ts, in the suit, being a company, which is registered under the Companies Act, 1 956, with its registered office, at Kolkata, and having a branch office at Guwah ati. In terms of the declaration, so sought for, the plaintiff also sought for a decree for recovery of the said amount, the suit of the plaintiff being, in su bstance, that he had worked for the defendant company for over 33 years, his pos tings being at different places in Assam and his last posting being at Gandrapar a Tea Garden, West Bengal, and that the defendants, having utilized his services , had not paid his dues and he was, therefore, entitled to receive his dues and also to be compensated for the loss, which had incurred as a result of non-payme nt of his dues. 5. The defendants-petitioners appeared in the suit and filed a petition, un der Order VII Rule 10 of the Code of Civil Procedure (in short, ’the CPC’), seek ing a direction to be passed returning the plaint of the plaintiff for the purpo se of institution of the suit in a court, which had jurisdiction to try the suit , the petition having been filed on the ground that the pleadings, as contained in the plaint, had not disclosed that the learned trial Court had territorial ju risdiction to try the suit. In short, it was on the ground of lack of territori al jurisdiction of the Court, at Guwahati, that the said application was filed b y the defendants seeking return of the plaint. 6. By order, dated 05.08.2008, as the learned Civil Judge (Senior Division) No.2, Kamrup, has rejected the defendants’ prayer to return the plaint, the def endants-petitioners, feeling aggrieved, are, now, before this Court with the pre sent revision. 7. I have heard Mr. K. Goswami, learned counsel for the defendants-petition ers, and Mr. M. Z. Ahmed, learned Senior counsel, appearing on behalf of the pla intiff-opposite party. 8. While considering the present revision, it may be pointed out, at the ve ry outset, that it is not in dispute that the defendant No. 1 is a company, regi stered under the Companies Act, with its registered office at Kolkata. However, while the plaintiff-opposite party asserts that the defendant No. 1 has a branc h office at Guwahati, the defendants-petitioners have disputed this assertion. S uch a disputed question of fact does not fall within the province of the present revision. 9. This Court, therefore, while deciding this revision, has to go by the as sumption that a branch office of the defendant No. 1 does exist at Guwahati. In fact, at the stage of consideration of the return of the plaint under Order 7 Ru le 10, what is to be looked into is the plaint and the averments made therein. I t is necessary to read the plaint in a meaningful manner to find out the real in tention behind the suit. The nature of the suit and its purpose have to be deter mined by reading the plaint as a whole. The inclusion or absence of a prayer is not decisive of the true nature of the suit, nor is the order in which the pray ers are arrayed in the plaint. The substance or object of the suit has to be ga thered from the averments made in the plaint and on which the reliefs are asked and the prayers are based. It must be borne in mind that the function of a plead ing is only to state material facts and it is for the court to determine the leg al result of those facts and to mould the relief in accordance with the result. (See Begum Sahiba Sultan Vs. Nawab Mohd. Mansur Ali Khan, reported in (2007) 4 S CC 343, Moolji Jaitha and Co. Vs. Khandesh Spg. and Wbg. Mills (AIR 1950 FC 83) and T. Aravindam Vs. TV Satyapal, reported in (1977) 4 SCC 467. 10. The question, however, remains as to whether the Court, at Guwahati, had the territorial jurisdiction to try the suit even if it is assumed that the def endant No. 1 has a branch office at Guwahati ? 11. It may, now, be noted that paragraph 3 of the plaint, which is relevant for the purpose of disposing of the present revision petition, reads as under: That the plaintiff was not only retained in service for over 33 years but was a lso promoted from time to time. In the year 1985 he was promoted to the post of manager, in the year 1997 he was promoted to the post of Senior Manager, in the year 2002 he was promoted as Deputy General Manager and as General Manager with effect from 01.01.2004 prior to his unjust and forceful retirement on 31.03.200 4. During the course of his service career the Plaintiff served in Darrang Dist rict, North Lakhimpur, Sibsagar District in Assam and in the Jalpaiguri District in West Bengal, bringing credit to the Tea Garden in the said Districts and his last posting was at Gandrapara T.G. in the Jalpaiguri District of West Bengal. (Emphasis is added) 12. From a bare reading of what have been averred in paragraph 3 of his plai nt, it becomes clear that the plaintiff claims that he had served at different p laces, within the State of Assam, as an employee of the defendant No. 1, the pla ces, where he has so served, being the districts of Darrang, North Lakhimpur an d Sivasagar. There is, admittedly, no averment, in paragraph 3 of the plaint, th at the plaintiff had, at any point of time, worked for the defendant No. 1 withi n the district of Kamrup. In fact, it is not disputed that the plaintiff has, n owhere, in the plaint, averred that he had, at any point of time, worked for the defendant No. 1 within the territorial limits of the District of Kamrup. The ’ cause of action’ has arisen, according to the plaintiff, because of the fact tha t he had worked for the defendant No. 1, but he had not been paid his dues. How ever, the fact of the matter remains that though it is the plaintiff’s case that he had worked for the defendant No. 1 in different districts of Assam, he does not claim to have ever served the defendant company in the district of Kamrup. Thus, the ’cause of action’, as the reading of the plaint shows, did not arise, wholly or in part, within the territorial jurisdiction of any Court, in the dis trict of Kamrup, including the Court of the Civil Judge (Senior Division), Kamru p. 13. The question, therefore, which confronts us, is: Whether the plaintiff c ould have instituted the suit at Guwahati, because of the fact that a branch off ice of the defendant No. 1 is located at Guwahati, though no part of the ’cause of action’ for the suit had arisen within the territorial limits of the distric t of Kamrup? 14. For the purpose of resolving the controversy, which has been raised in t he present case, it may be noted that, according to Section 19 CPC, if a wrong i s done to a person or to movable property within the local limits of the jurisdi ction of one Court and the defendant resides, or carries on business, or persona lly works for gain, within the local limits of the jurisdiction of another Court , the suit for compensation for the wrong done may be instituted at the option o f the plaintiff in either of the said courts. 15. Coupled with the above, Section 20 CPC, being relevant, is also reprodu ced below: 20. Other suit to be instituted where defendants reside or ’cause of action’ ar ises. - Subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction - (a) the defendant, or each of the defendants, where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or c arries on business, or personally works for gain; (b) any of the defendants, where there are more than one, at the time of the com mencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either the leave of th e Court is given or the defendants, who do not reside, or carry on business, or personally work for gain, as aforesaid, acquiesce in such institution; or (c) the ’cause of action’, wholly or in part, arises. Explanation - A Corporation shall be deemed to carry on business at its sole or principal office in India or, in respect of any ’cause of action’ arising at any place where it has also a subordinate office, at such place. 16. From a careful reading of the provisions, contained in Section 20, what can be gathered is that a suit can be instituted in a court within the local lim its of whose jurisdiction the defendant, or each of the defendants, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain. Section 20 (b) provides that a suit ca n also be instituted in court within the local limits of whose jurisdiction the defendant, or any of the defendants, where there are more than one, at the time of commencement of the suit, actually and voluntarily resides, or carries on bus iness, or personally works for gain, provided that in such a case, either the le ave of the Court is given or the defendants, who do not reside, or carry on busi ness, or personally work for gain, as aforesaid, acquiesce in such institution. Section 20(c) lays down that a suit can also be instituted in a court within t he local limits of whose jurisdiction the ’cause of action’, wholly or in part, arises. The Explanation to Section 20 CPC shows that a corporation, which, obvi ously, includes a company, registered under the Companies Act, 1956, shall be de emed to be carrying on its business at its sole or principal office in India. 17. Pausing here, for a moment, it can be pointed out that since a company s hall be deemed to carry on its business at its sole or principal office in India , it logically follows that even when ’cause of action’ for a suit does not aris e within the territorial limits of the jurisdiction of the court, where the prin cipal or the sole office of a defendant company, in India, is located, a suit ca n be filed in such a Court inasmuch as the Explanation to Section 20 creates a l egal fiction that a corporation shall be deemed to carry on its business at its sole or principal office in India. In other words, irrespective of the fact as to whether ’cause of action’ for a suit has or has not arisen within the territo rial limits of the jurisdiction of the court, where the sole or principal office of a company is located, a suit can be instituted within the territorial limits of the jurisdiction of the Court within the limits of whose local jurisdiction the ’cause of action’, either in whole or in part, has arisen. 18. With regard to the question as to whether a suit must be instituted at t he very place, where the ’cause of action’ arises or where the sole or principal office is located or is it permissible to institute a suit, at a place, solely on the ground that a subordinate or branch office of the defendant company is lo cated there, the Explanation to Section 20 clarifies that though the principal o ffice or the sole office of a company may be at a different place, the suit can nevertheless be instituted at the place, where the ’cause of action’ has arisen and also where the defendant company’s subordinate office is situated. What is, however, extremely important to note is that the location of the subordinate of fice does not create the jurisdiction for the court. Far from this, it is the ’ cause of action’, which creates the jurisdiction for the court. There is no imp ediment, in law, in instituting a suit against a company at a place, where the ’ cause of action’, either in whole or in part, arises. Even at a place, where ’c ause of action’ for a suit may not have arisen, a suit may be instituted if the sole or principal office of the company is located there, for, the Explanation t o Section 20 creates a legal fiction that a company shall be deemed to have been carrying on business at the place, where its sole or principal office is locate d. 19. What emerges from the above discussion is that a suit can be instituted against a company at a place, where the ’cause of action’, either wholly or in p art, arises, or at the place, where the defendant company’s sole or principal of fice is located. A suit may also be instituted at a place, where the ’cause of action’, wholly or in part, arises even if such a place is the place, where a br anch or subordinate office of the company is located and not its principal offic e. The reference, made by Mr. Goswami, in this regard, to the case of Patel Roa dways Limited, Bombay v. Prasad Trading Company, reported in (1991) 4 SCC 270, i s not misplaced, where the Supreme Court, while dealing with the question, which has arisen in the present revision, has observed and held as under: 9. Clauses (a) and (b) of Section 20 inter alia refer to a court within the loc al limits of whose jurisdiction of the defendant inter alia ’carries on business ’. Clause (c) on the other hand refers to a court within the local limits of wh ose jurisdiction the ’cause of action’ wholly or in part arises & &.. 12 & & & The Explanation is really an Explanation to clause (a). It is in the natu re of a clarification on the scope of clause (a) viz. as to where the corporatio n can be said to carry on business. This, it is clarified, will be the place wh ere the principal office is situated (whether or not any business actually is ca rried on there) or the place where a business carried on giving rise to a ’cause of action’ (even though the principal office of the corporation is not located there) so long as there is a subordinate office of the corporation situated at s uch place. The linking together of the place where the ’cause of action’ arises with the place where a subordinate office is located clearly shows that the int ention of the legislature was that, in the case of a corporation, for the purpos e of clause (a), the location of the subordinate office, within the local limits of which a ’cause of action’ arises, is to be the relevant place for the filing of a suit and not the principal place of business. If the intention was that t he local of the sole or principal office as well as the subordinate office (with in the limits of which a ’cause of action’ arises) are to be deemed to be places where the corporation is deemed to be carrying on business, the disjunctive ’or ’ will not be there. Instead, the second part of the Explanation would have rea d ’and, in respect of any ’cause of action’ arising at any place where it has a subordinate office, also at such place’. 13. & & & & &.The clear intendment of the Explanation, however, is that, where the orporation has a subordinate office in the place where the ’cause of action’ ari ses, it cannot be heard to say that it cannot be sued there because it does not carry on business at that place. It would be a great hardship if, in spite of t he corporation having a subordinate office at the place where the ’cause of acti on’ arises (with which in all probability the plaintiff has had dealings), such plaintiff is to be compelled to the place where the corporation has its principa l place. That place should be convenient to the plaintiff; and since the corpor ation has an office at such place, it will also be under no disadvantage. Thus the Explanation provides an alternative locus for the corporation’s place of bus iness, not an additional one. (Emphasis is ad ded) 20. From what have been observed and laid down in Patel Roadways Limited (su pra), it clearly surfaces that the linking together of the place, where the caus e of action arises, with the place, where a subordinate office is located, clear ly shows that the legislative intent is that, in the case of a corporation, for the purposes of clause (a), the location of the subordinate office, within the l ocal limits of which a ’cause of action’ arises, is to be the relevant place for the filing a suit and not the principal place of business. 21. In the case in hand, while rejecting the prayer of the defendants seekin g return of the plaint, as indicated above, the learned Court below has assigned really no reason inasmuch as the learned Court below, having referred to variou s decisions, which the learned counsel for the contesting parties relied upon, m erely recorded that it is of the considered view that the petition, made by the defendant Nos. 1 and 2, under Order VII Rule 10 of the CPC, is devoid of merit. Why the defendant-petitioners’ application was found devoid of merit is not disc ernible from the impugned order. 22. From a microscopic reading of the averments made in the plaint, as a who le, and the contents of paragraph 3 of the plaint, in particular, it clearly sur faces that the plaintiff, according to his own averments, did not, at any given point of time, serve the defendant company in the district of Kamrup. Clearly, t herefore, the ’cause of action’ did not arise within the territorial limits of t he jurisdiction of the court in the district of Kamrup and, as neither the ’caus e of action’ for the suit arose within the territorial limits of the Court, at G uwahati, nor is the principal or sole office of the defendant company is located within the territorial limits of the Court, at Guwahati, the suit could not hav e been instituted, at Guwahati, merely because of the fact that a subordinate or branch office of the defendant company is situated within the district of Kamru p. When this aspect of the matter was brought to the notice of the Court by the defendants-petitioners, by filing petition, seeking return of the plaint by the Court, in terms of the provisions of Order VII Rule 10, the learned Court below ought to have, in the facts of the present case and the law, relevant thereto, p assed necessary order returning the plaint to the plaintiff-opposite party with direction to present the same in a Court of competent jurisdiction. 23. Having realized that the suit, in the light of the pleadings in the plai nt, could not have been instituted at Guwahati, Mr. Ahmed, learned Senior counse l, submits that the plaintiff would apply to the learned Court below seeking lea ve to withdraw the suit with liberty to institute the suit in a court of compete nt jurisdiction or seeking leave for amendment of the suit. 24. While considering the above submissions, made on behalf of the plaintiff -opposite party, suffice it to point out, in this regard, that it is really for the plaintiff-opposite party to decide his course of action inasmuch as this Cou rt, while in sesin of this revision, is merely required to decide as to whether, in the facts and attending circumstances of the present case and the law releva nt thereto, the impugned order could have been passed and is sustainable. 25. For the reasons, already assigned above, this Court is of the firm view that the defendants’ prayer to return the plaint, for its presentation in the Co urt of competent jurisdiction, ought to have been allowed. 26. In the result and for the reasons discussed above, this revision succeed s. The impugned order is hereby set aside and the learned Court below is direct ed to pass appropriate order, in terms of Order VII Rule 10, as regards return o f the plaint. 27. Before parting with this revision, it is, however, made clear that if th e plaintiff-opposite party makes any application in the suit, seeking withdrawal of the suit with liberty to institute a fresh suit or seeking amendment of the plaint, it would remain for the learned Court below to decide and dispose of the same in accordance with law. 28. With the above observations and directions, this revision petition stand s disposed of. 29. No order as to costs.