1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION SECOND APPEAL NO.290 OF 2010 WITH CIVIL APPLICATION NO.790 OF 2010 Bharat Petroleum Corporation Ltd. ..Appellants Vs. Balasaheb Gopalrao Kadam and ors. ..Respondents ......... Mr.N.M.Sakhardande i/b.Mr.S.R.Page, for appellants. Mr.Amit B.Borkar, for respondent no.1. ......... CORAM: R.G.KETKAR, J. DATE : 16 th JUNE, 2010. P.C. : This appeal was heard on 16 th June, 2010. After hearing learned counsel for the parties, for the reasons to be recorded separately, the Second Appeal was dismissed. Now, I propose to give the reasons for the dismissal of the appeal. 2] This appeal is preferred by the original defendant against the judgment and decree dated 9 th November, 2009 passed by the learned Adhoc District Judge­1, Kolhapur in Regular Civil Appeal No.143 of 2009 arising out of the 290­10.sxw 2 judgment and decree dated 13 th April, 2009 passed by the learned 3 rd Jt. Civil Judge, Senior Division, Kolhapur in Regular Civil Suit No.32 of 2003. By the impugned judgments, the courts below decreed the suit instituted by the respondents for recovery of possession of premises admeasuring 132.21 sq. meters from western portion of CTS No.871 C­ward, Kolhapur as more particularly described in paragraph 1 of the plaint. The parties will be hereafter referred as per their original status in the trial court. 3] The plaintiffs instituted suit for recovery of possession, arrears of rent and mense profits under the provisions of the Transfer of Property Act, 1882 (for short “the Act”). Initially, an area admeasuring 262.01 sq. meters in CTS No.871, C­Ward, Kolhapur was jointly owned by Gopalrao Krishna Kadam and his brother Bapusaheb Krishna Kadam, since deceased. Gopalrao and Bapusaheb had jointly leased the said property to the defendant vide lease deed dated 24 th September, 1965 which was duly registered on 2 nd November, 1965. The said lease was for a period of 10 years and agreed monthly rent was Rs.200/­ which was thereafter raised to Rs.250/­ p.m. Subsequently, there was partition between Gopalrao and Bapusaheb. Gopalrao was allotted western side half portion admeasuring 132.21 sq. meters out of CTS No.871 and eastern half partition admeasuring 129.80 sq. meters was allotted to Bapusaheb. In view of 290­10.sxw 3 this allotment, lease of CTS No.871 was split up and the monthly rent was also split up between these two brothers. Gopalrao was receiving Rs.125/­ p.m. After expiry of 10 years lease period in September, 1975, the defendant applied to continue the lease for a further period of ten years which again expired in September, 1985. Thereafter, lease has not been renewed and, therefore, the defendant’s possession over the suit property was like a tenant holding over. 4] It is the case of the plaintiffs, that the defendant has no right to be in occupation in the suit premises as it is not protected under the provisions of the Maharashtra Rent Control Act, 1999. The defendant is a Public Limited Company having paid up capital of more than Rs.One Crore. The plaintiffs terminated the lease of the defendant by serving a notice dated 9 th October, 2002 by RPAD asking the defendant to vacate the said premises and hand over its possession peacefully on or before 31 st October, 2002. The said notice was duly served upon the defendant, and was replied on 7 th November, 2002. The plaintiffs, therefore, instituted a suit for recovery of possession, rent and mense profits. 5] The defendant resisted the suit by filing a written statement inter alia contending that in the first place, the plaintiffs have accepted the rent from the 290­10.sxw 4 defendant till end of March, 1997 and the lease was renewed on the same terms and conditions. Secondly, it was asserted that one of the conditions in the lease deed was that, in case of dispute in respect of the lease deed, the court at Mumbai will have the exclusive jurisdiction. Therefore, the court at Kolhapur has no jurisdiction to entertain and try the suit. 6] On the basis of material available on record, the trial court decreed the suit. The defendant carried the matter in appeal which was dismissed. It is against these two orders, the present Second Appeal is preferred. 7] Heard Mr.N.M.Sakhardande i/b.Mr.S.R.Page, learned counsel for the appellant and Mr.Amit B.Borkar, learned counsel for the respondent no.1. 8] Mr.Sakhardande submitted that having regard to one of the stipulations in the lease deed, the Civil Court at Kolhapur will have no jurisdiction and the civil court at Mumbai will have the exclusive jurisdiction to entertain and try the suit. He relied upon the Clause 4(h) of the lease deed which reads as under “4(h) ONLY BOMBAY COURTS shall have exclusive jurisdiction over all disputes which may arise under this indenture.” 290­10.sxw 5 He submitted that the aforesaid extracted clause clearly excludes the jurisdiction of the civil court at Kolhapur to entertain and try the suit. He submitted that the defendant has its registered office at Mumbai and having regard to explanation to Section 20 (c) of the Code of Civil Procedure, 1908 (for short “CPC”) 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. In support of this submission he relied upon the following judgments of the Apex Court :­ 1. A.B.C. Laminart Pvt. Ltd. and another Vs. A.P.Agencies, Salem, AIR 1989 SC 1239. 2. Rajasthan State Electricity Board Vs. Universal Petrol Chemicals Limited, (2009) 3 SCC 107. 9] He has invited my attention to Section 16 of CPC and one of the prayers namely prayer (b) by which the plaintiffs are claiming mesne profit. According to him, by this prayer the plaintiffs are seeking a relief entirely through the defendant’s personal obedience. By virtue of clause 4(h) of the lease deed, the parties agreed to confer the jurisdiction on a civil court at Mumbai. Since the defendant is carrying its business in Mumbai, in terms of Section 20(c) of the CPC, the Civil Court at Mumbai alone will have jurisdiction to try and entertain 290­10.sxw 6 the suit. 10] Mr.Sakhardande further urged that the State Government issued directive dated 3 rd December, 2009 under Section 37(1) read with section 154 of the Maharashtra Regional and Town Planning Act, 1966 to carry out modification in the existing Development Control Rules. The proposed modification is to the following effect:­ “Provided that in the redevelopment of sites of existing filling and service station of Petrol, Diesel, Compressed Natural Gas or any other Motor Vehicle fuel, change of user shall not be permitted. He submitted that in view of the above, the plaintiffs will not be in a position to use the suit property for the purpose other than service station of Petrol, Diesel, Compressed Natural Gas or any other Motor Vehicle fuel. The user of the said property cannot be changed in view of these directives of the Government of Maharashtra. In other words, he submitted that even if the plaintiffs get the possession of the suit property, they will not be in a position to change the user of the suit property. 11] On the other hand, Mr.Borkar, learned counsel for the respondents, supported the impugned judgment and decree. He submitted that under Section 290­10.sxw 7 16 of the CPC, a suit, subject to the pecuniary or other limitations prescribed by any law, relating to Clause (a) to (f), shall be instituted in the court within the local limits within whose jurisdiction the property is situate. Since the suit property is situate in Kolhapur, notwithstanding clause 4(h) of the lease deed, the Civil Court at Kolhapur alone will have the jurisdiction to entertain and try the suit. In so far as the prayer (b) is concerned, he submitted that the said prayer is also covered under Section 16(a) of the CPC and is not covered by the proviso to Section 16. He relied upon the judgment of the Apex Court in the case of Harshad Chiman Lal Modi Vs. DLF Universal Ltd. and another, (2005) 7 SCC 791. 12] In so far as the reliance placed by learned counsel for the defendant on the judgment of the Apex Court in the case of A.B.C.Laminart (supra) is concerned, in that case the first petitioner entered into an agreement with the respondent whereunder the appellants were to supply 5000 bobbins of Rupalon Metallic Yarn. Clause 11 of the agreement provided that “any dispute arising out of this sale shall be subject to Kaira jurisdiction”. Considering the provisions of the Contract Act and, in particular, Section 2(a), 23 and 28 as also Section 20(c) of the CPC, the Apex Court held that the court at Salem would also have jurisdiction to entertain and try the suit. 290­10.sxw 8 13] In the case of Rajasthan State Electricity Board (supra), the appellant therein had placed an order for supply of 50 kilolitre of transformer oil with the respondent Company having its registered office and manufacturing unit at Kolkata. After the purchase order and agreement was entered into the parties at Jaipur, clause 30 of the General Conditions of the contract inter alia stipulated that the contract shall for all purposes be construed according to the laws of India and subject to jurisdiction only at Jaipur in Rajasthan courts only. In the second purchase order dated 2 nd December, 1987 in addition to this clause, the clause with respect to jurisdiction of the court in case of dispute was incorporated. By that clause, all disputes, differences or questions whatever which may arise between the purchaser and the supplier upon or in relation with or in connection with the contract shall be deemed to have arisen at Jaipur (Rajasthan) and no court other than the court at Jaipur (Rajasthan) shall have jurisdiction shall have jurisdiction to entertain or try the same. 14] In so far as the present case is concerned, the plaintiffs have instituted the suit for recovery of immovable property. The judgments relied upon by the learned counsel for the defendant were concerned with sale of goods and recovery of prices thereof and, therefore, were governed by Section 20(c) of the CPC. In the case of Harshad Modi (supra), the Apex Court considered the 290­10.sxw 9 scheme of Section 15 to 20 of the CPC. In that case, the appellants/plaintiffs entered into a “plot buyer agreement” with respondent no.1 for purchase of residential plot admeasuring 264 sq. mtr. In Residential Colony, DLF Qutub Enclave Complex, Gurgaon, Haryana. The appellant instituted a suit for declaration and specific performance of agreement dated 14 th August, 1985, for possession of the property and permanent injunction. Considering the scheme of Section 15 to 20 CPC, the Apex Court observed in paragraph nos.15 and 16 of the judgment as under:­ 15.Now, Sections 15 to 20 of the Code contain detailed provisions relating to jurisdiction of courts. They regulate forum for institution of suits. They deal with the matters of domestic concern and provide for the multitude of suits which can be brought in different courts. Section 15 requires the suitor to institute a suit in the court of the lowest grade competent to try it. 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. The 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 are uncertain. Section 19 is a special 290­10.sxw 10 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 to 19. 16. Section 16 thus recognises a well­established 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. The 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 a well­ known maxim “equity acts in personam”, recognised by the Chancery court in England. The Equity Courts had jurisdiction to entertain certain suits respecting immovable properties situated abroad through personal obedience of the defendant. The principle on which the maxi was based was that the courts could grant relief in suits respecting immovable property situate abroad by enforcing their judgments by process in personam i.e. by arrest of the defendant or by attachment of his property. Thus, the Apex Court held that the court within whose jurisdiction the property is not situated, has no power to deal with and decide the rights and interest in such property. In view thereof, I am clearly of the opinion that the Civil Court at Kolhapur has the jurisdiction to entertain and try the suit as the suit property is situate at Kolhapur. 15] Learned counsel for the defendant has submitted that the plaintiffs are 290­10.sxw 11 claiming mense profit and having regard to the proviso to Section 16, the said relief can be obtained through the personal obedience of the defendant, and having regard to Clause 4(h) of the lease deed, the Civil Court at Mumbai will have jurisdiction. Even, this submission is without merit as Section 16(a) provides for institution of a suit for recovery of immovable property with or without rent or profits and provide for the court within whose jurisdiction the property is situated. 16] Learned counsel for the defendant relied upon the directive dated 3 rd December, 2009 issued by the State Government under Sections 37 and 154 of the Maharashtra Regional and Town Planning Act, 1966 and submitted that even if the plaintiffs get possession of the suit property, they cannot change the user of the said property. I do not find any substance in the said submission as well. By that directive, the State Government has decided that in all Municipal Corporation areas restrictions should be brought for closure of existing Petrol/Diesel Pumps and CNG Stations and use this existing place for any other purposes. Accordingly as per Maharashtra Regional and Town Planning Act, 1966, Section 37(1) read with Section 154, all the Municipal Corporations under their Development Control Rules, following additions were ordered to be incorporated in the appropriate places:­ 290­10.sxw 12 “Provided that in the redevelopment of sites of existing filling and service station of Petrol, Diesel, Compressed Natural Gas or any other Motor Vehicle fuel, change of user shall not be permitted. 17] I do not find any substance in this submission as well. In the first place, this directive is issued by the State Government on 3 rd December, 2009 i.e. to say after and the judgment of the learned District Judge dated 9 th November, 2009. In other words, this point could not have been raised in the courts below. Still I permitted learned counsel for the appellant to agitate the said point. Secondly, nothing is brought on record as to whether the Municipal Corporation of the city of Kolhapur has initiated any proceeding by publishing a notice under Section 37 of the Maharashtra Regional and Town Planning Act, 1966 inviting objections and suggestions. Thus, as of today, there is no material to indicate that after following the procedure under Section 37 of the M.R.T.P. Act, 1966, the Government has sanctioned the proposed modifications to the Development Control Rules of the Municipal Corporation, Kolhapur. I do not find any substance in this submission as well. No other point was urged in support of this submission. 290­10.sxw 13 18] In the result, I do not find that the Second Appeal raises any substantial question of law. Second Appeal is dismissed with no order as to the costs. 19] At the request of learned counsel for the defendant, this order shall remain stayed for a period of four weeks from today. 20] As the appeal is dismissed, no orders are necessary in the Civil Application. Civil Application No.790 of 2010 is disposed of with no order as to the costs. [R.G. KETKAR, J.] 290­10.sxw