Case: Subhlaxmi Fabrics Pvt. Ltd Vs. Chand Mal Maradia

empowered to rule about its own jurisdiction. It is, therefore, open to the plaintiff to raise all the pleas before defendant No.2 including a plea that there is no arbitration agreement between the parties for referring any dispute for arbitration before the Hindustan Chamber of Commerce, Mumbai. It is also important to note that in response to the notice issued by defendant No.2 the plaintiff had sent a communication raising certain pleas and had also remitted an amount of Rs. 200/- as fee for arbitration. In such circumstances we are of the opinion that the view taken by the City Civil Court was just and proper and the High Court erred in granting an injunction in favour of the plaintiff and staying the proceedings before defendant No.2. 15. The other point, which needs consideration, is that the appellant had raised a specific plea by moving an application under Section 20 read with Section 151 CPC before the trial court that the court at Calcutta had no territorial jurisdiction to try, the suit. According to the appellant the indent (contract) contained a clause that the dispute under the contract shall be decided by the court any Bombay and by no other court. That apart it was defendant No.1, which had commenced arbitration proceedings before defendant No.2 and both are situate in Bombay. 16. The plaintiff wants that the Hindustan Chamber of Commerce (defendant No.2) may be restrained from proceeding with arbitration of the dispute, which has been raised by the appellant Shree Subhlaxmi Fabrics Pvt. Ltd. (defendant No.1). Both defendant No.1 and defendant No.2 have their offices at Bombay. Insofar as commencement of proceedings before defendant No. 2 by defendant No. 1 is concerned, no part of cause of action has accrued in Calcutta. 17. In Hakam Singh vs. Gammon (India) Ltd. 1971(1) SCC 286, it has been held that it is not open to the parties to confer by their agreement jurisdiction on a court which it does not possess under the Code. But where two courts or more have under the Code of Civil Procedure jurisdiction to try a suit or a proceeding, an agreement between the parties that the disputes between them shall be tried in one of such courts is not contrary to public policy and that such an agreement does not contravene Section 28 of the Contract Act. In A.B.C. Laminart (P) Ltd. vs. A.P. Agencies 1989 (2) SCC 163, it was held as under:- When the court has to decide the question of jurisdiction pursuant to an ouster clause it is necessary to construe the ousting expression or clause properly. Often the stipulation is that the contract shall be deemed to have been made at a particular place. This would provide the connecting factor for jurisdiction to the courts of that place in the matter of any dispute on or arising out of that contract. It would not, however, ipso facto take away jurisdiction of other courts. Where an ouster clause occurs, it is pertinent to see whether there is ouster of jurisdiction of other courts. When the clause is clear, unambiguous and specific accepted notions of contract would bind the parties and unless the absence of ad idem can be shown, the other courts should avoid exercising jurisdiction. As regards construction of ouster clause when words like alone, exclusive and the like have been used there may be no difficulty. Even without such words in appropriate cases the maxim expressio unius est exclusion alterius - expression of one is the exclusion of another may be applied. What is an appropriate case shall depend on the facts of the case. In such a case mention of one thing may imply exclusion of another. When certain jurisdiction is specified in a contract an intention to exclude all others from its operation may in such cases be inferred. It has therefore to be properly construed. 18. This view has been reiterated in Angile Insulation vs. Davy Ashmore India Ltd. (1995(4) SCC 153). 19. In the case on hand the clause in the incident is very clear, viz. court of Bombay and no other court. The trial court on consideration of material on record held that the court at Calcutta had no jurisdiction to try the suit. 20. The High Court in the earlier part of the judgment noted that the invoice contained clause like under jurisdiction of the court from where the goods have been dispatched and in the indent (contract) a clause like dispute under this contract shall be decided by the courts of Bombay and by no other courts. Further, while recording its findings on the plea raised by the appellant regarding jurisdiction it held as under:- In the facts and circumstances of this case, the plaintiff has no doubt an arguable case that he did not consciously agree to the exclusion of the jurisdiction of the courts of its business. Its case that from where the goods has been dispatched, is not sufficiently specific as to exclude a courts jurisdiction, is no doubt an arguable case. 21. In our opinion that approach of the High Court is not correct. The plea of the jurisdiction goes to the very root of the matter. The trial court having held that it had no territorial jurisdiction to try the suit, the High Court should have gone deeper into the matter and until a clear finding was recorded that the court had territorial jurisdiction to try the suit, no injunction could have been granted in favour of the plaintiff by making rather a general remark that the plaintiff has an arguable case that he did not consciously agree to the exclusion of the jurisdiction of the court. 22. On overall consideration of the matter, we are clearly of the opinion that on the facts and circumstances of the case the view taken by the trial court was perfectly correct and the High Court has erred in reversing its order and granting an injunction in favour of the plaintiff.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]are of the opinion that the view taken by the City Civil Court was just and proper and the High Court erred in granting an injunction in favour of the plaintiff and staying the proceedings before defendant No.221. In our opinion that approach of the High Court is not correct. The plea of the jurisdiction goes to the very root of the matter. The trial court having held that it had no territorial jurisdiction to try the suit, the High Court should have gone deeper into the matter and until a clear finding was recorded that the court had territorial jurisdiction to try the suit, no injunction could have been granted in favour of the plaintiff by making rather a general remark that the plaintiff has an arguable case that he did not consciously agree to the exclusion of the jurisdiction of the court22. On overall consideration of the matter, we are clearly of the opinion that on the facts and circumstances of the case the view taken by the trial court was perfectly correct and the High Court has erred in reversing its order and granting an injunction in favour of the plaintiff.