Case: Maharashtra Chess Association Vs. Union of India &amp; Ors

3. The second Respondent, the All India Chess Federation is a society registered under the Societies Registration Act 1860. It is a central governing authority for chess in India. The Appellant is a society registered under the Act of 1860 and was an affiliated member of the second Respondent since 1978. On 25 December 2016, the Central Council of the second Respondent passed a resolution to disaffiliate the Appellant. After the institution of the writ proceedings, the third Respondent has been affiliated by the second Respondent in place of the Appellant.4. The Appellant had filed a writ petition before the Bombay High Court under Article 226 of the Constitution impleading, inter alia the second Respondent. The second Respondent raised a preliminary objection that the Bombay High Court did not have jurisdiction to entertain the writ petition on the ground that Clause 21 of the Constitution and Bye Laws conferred exclusive jurisdiction on courts at Chennai in disputes involving the second Respondent and any other party to the Constitution and Bye Laws, including the Appellant. The Bombay High Court held that Clause 21 ousted the jurisdiction of all other courts except the courts at Chennai. The High Court held:…In the facts of the present case when there is existence of Clause 21 which we have adverted to herein above, in our view, the jurisdiction of the other Courts except the Courts at Chennai in respect of any Suits/Legal action which are brought against Respondent No. 2 are ousted…

Court's reasoning:
8. The Constitution and Bye Laws of the second Respondent are a private agreement between the Appellant and the second Respondent. The decision of the Bombay High Court relied solely on Clause 21 to hold that its own writ jurisdiction, and the jurisdiction of all other courts, is ousted.9. It is a well settled principle of contract law that parties cannot by contract exclude the jurisdiction of all courts. Such a contract would constitute an agreement in restraint of legal proceedings and contravene Section 28 of the Indian Contract Act 1872 (Section 28. Agreements in restraint of legal proceedings, void — Every agreement,- (a) by which any party thereto is restricted absolutely from enforcing his rights under or in respect of any contract, by the usual legal proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights; or (b) which extinguishes the rights of any party thereto, or discharges any party thereto, from any liability, under or in respect of any contract on the expiry of a specified period so as to restrict any party from enforcing his rights, is void to the extent) However, where parties to a contract confer jurisdiction on one amongst multiple courts having proper jurisdiction, to the exclusion of all other courts, the parties cannot be said to have ousted the jurisdiction of all courts. Such a contract is valid and will bind the parties to a civil action.10. Parties cannot by agreement confer jurisdiction on a court which lacks the jurisdiction to adjudicate. But where several courts would have jurisdiction to try the subject matter of the dispute, they can stipulate that a suit be brought exclusively before one of the several courts, to the exclusion of the others. Clause 21 does not oust the jurisdiction of all courts. Rather, the Appellant and the second Respondent have agreed to submit suits or legal actions to the courts at Chennai. So long as the courts at Chennai have proper jurisdiction over a dispute involving the Appellant and the second Respondent, Clause 21 is not in violation of the principle set out in A B C Laminart. However, the decision in A B C Laminart was made in the context of an original suit and the jurisdiction of an ordinary civil court. The present case is materially different. The Appellant approached the Bombay High Court under Article 226. The second Respondent seeks to rely on Clause 21 to oust the writ jurisdiction of the High Court of Bombay.13. While the powers the High Court may exercise under its writ jurisdiction are not subject to strict legal principles, two clear principles emerge with respect to when a High Courts writ jurisdiction may be engaged. First, the decision of the High Court to entertain or not entertain a particular action under its writ jurisdiction is fundamentally discretionary. Secondly, limitations placed on the courts decision to exercise or refuse to exercise its writ jurisdiction are selfimposed. It is a well settled principle that the writ jurisdiction of a High Court cannot be completely excluded by statute. If a High Court is tasked with being the final recourse to upholding the rule of law within its territorial jurisdiction, it must necessarily have the power to examine any case before it and make a determination of whether or not its writ jurisdiction is engaged. Judicial review under Article 226 is an intrinsic feature of the basic structure of the Constitution.16. The observation extracted above raises an important consideration with respect to the present case. If, by the self-imposed rule, the writ jurisdiction of High Courts is circumscribed by the existence of a suitable alternate remedy, whether constitutional, statutory, or contractual, then a High Court should not exercise its writ jurisdiction where such an alternate remedy exists.It follows that if the Respondents argument is accepted, the High Court of Madras would hear the present matter. Therefore, the alternate remedy (i.e. a writ petition before the High Court of Madras) is equal in every way to the present remedy sought by the Appellant. The High Court of Madras is imbued with the same powers in the exercise of its writ jurisdiction. The submission on the above premises is that the Appellant can avail of the same relief at Chennai as it may in Mumbai. Hence, the agreement between the parties must prevail and the writ jurisdiction of the Bombay High Court under Article 226 stands ousted.18. This argument of the second Respondent is misconceived. The existence of an alternate remedy, whether adequate or not, does not alter the fundamentally discretionary nature of the High Courts writ jurisdiction and therefore does not create an absolute legal bar on the exercise of the writ jurisdiction by a High Court. The decision whether or not to entertain an action under its writ jurisdiction remains a decision to be taken by the High Court on an examination of the facts and circumstances of a particular case.21. The mere existence of alternate forums where the aggrieved party may secure relief does not create a legal bar on a High Court to exercise its writ jurisdiction. It is a factor to be taken into consideration by the High Court amongst several factors. Thus, the mere fact that the High Court at Madras is capable of granting adequate relief to the Appellant does not create a legal bar on the Bombay High Court exercising its writ jurisdiction in the present matter.As discussed above, the writ jurisdiction of the High Court is fundamentally discretionary. Even the existence of an alternate adequate remedy is merely an additional factor to be taken into consideration by the High Court in deciding whether or not to exercise its writ jurisdiction. This is in marked contradistinction to the jurisdiction of a civil court which is governed by statute (Section 9. Courts to try all civil suits unless barred – The Courts shall (subject to the provisions herein contained) have jurisdiction to try all suits of a civil nature excepting suits of which their cognizance is either expressly or impliedly barred). In exercising its discretion to entertain a particular case under Article 226, a High Court may take into consideration various factors including the nature of the injustice that is alleged by the petitioner, whether or not an alternate remedy exists, or whether the facts raise a question of constitutional interpretation. These factors are not exhaustive and we do not propose to enumerate what factors should or should not be taken into consideration. It is sufficient for the present purposes to say that the High Court must take a holistic view of the facts as submitted in the writ petition and make a determination on the facts and circumstances of each unique case.24. The court examined the facts holistically, noting that the contract was executed and to be performed in Aligarh, and the arbitrator was to function at Aligarh. It did consider that the contract conferred jurisdiction on the courts at Aligarh, but this was one factor amongst several considered by the court in determining that the High Court of Calcutta did not have jurisdiction25. In the present case, the Bombay High Court has relied solely on Clause 21 of the Constitution and Bye Laws to hold that its own writ jurisdiction is ousted. The Bombay High Court has failed to examine the case holistically and make a considered determination as to whether or not it should, in its discretion, exercise its powers under Article 226. The scrutiny to be applied to every writ petition under Article 226 by the High Court is a crucial safeguard of the rule of law under the Constitution in the relevant territorial jurisdiction. It is not open to a High Court to abdicate this responsibility merely due to the existence of a privately negotiated document ousting its jurisdiction26. It is certainly open to the High Court to take into consideration the fact that the Appellant and the second Respondent consented to resolve all their legal disputes before the courts at Chennai. However, this can be a factor within the broader factual matrix of the case. The High Court may decline to exercise jurisdiction under Article 226 invoking the principle of forum non conveniens in an appropriate case. The High Court must look at the case of the Appellant holistically and make a determination as to whether it would be proper to exercise its writ jurisdiction. We do not express an opinion as to what factors should be considered by the High Court in the present case, nor the corresponding gravity that should be accorded to such factors. Such principles are well known to the High Court and it is not for this Court to interfere in the discretion of the High Court in determining when to engage its writ jurisdiction unless exercised arbitrarily or erroneously. The sole and absolute reliance by the Bombay High Court on Clause 21 of the Constitution and Bye Laws to determine that its jurisdiction under Article 226 is ousted is however one such instance.