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Esquire Express & Courier Service & Others v/s The Union of India & Others

    W.P. (C) No. 209 of 2018

    Decided On, 12 September 2019

    At, High Court of Tripura


    For the Appellants: S.M. Chakraborty, Senior Advocate, Samar Das, Advocate. For the Respondents: A. De, Advocate.

Judgment Text

Sanjay Karol, CJ.

1. The sole issue which arises for consideration in the present petition as to whether parties by an agreement can oust jurisdiction of other Courts by conferring it to a particular place otherwise having jurisdiction.

2. In the instant petition, petitioners lay challenge to Communication dated 02.01.2018, issued by the Senior Divisional Commercial Manager, Northeast Frontier Railway, Lumding Division, Lumding, a place falling within the territorial jurisdiction of the High Court of Guwahati, State of Assam.

3. The crux of the matter being that vide Notice Inviting Tender (in short, NIT) dated 24.07.2017, the Additional Divisional Railway Manager, Northeast Frontier Railway, Lumding Division invited proposals for running the Parcel Cargo Express Train (in short, PCET) in relation to which petitioners submitted their tender as also deposited earnest money amounting to Rs. 50,00,000. The route on which the PCET was to run was from Agartala - (falling within the State of Tripura) Silchar - Chitpur (falling within the State of Assam) - Sakur Basti via Bareilly, Lucknow, Varanasi (falling within the State of Uttar Pradesh). The tender submitted by the petitioners was found not to be compliant and as such not considered favourably. However, the Railway authorities did not refund the amount of earnest money so deposited, for certain amounts were due from the petitioners as Demurrage Charges/Undercharges in relation to another PCET tender No. C/17 of 2012 dated 25.09.2012 of route Guwahati to Patel Nagar under execution by the petitioners. Since they failed to pay the same, the amount deposited as security deposit was withheld, which action was made known vide communication dated 02.01.2018 subsequent matter of challenge in the present petition.

4. It is a matter of record that in relation to earlier contract this Court does not have any jurisdiction, and that petitioners had themselves approached the High Court of Guwahati by way of W.P. (C) No. 7726 of 2015, which stood disposed of with certain directions to the authorities for consideration of petitioners' claims. Pursuant thereto, necessary consequential action was taken and as on the date of the filing of instant petition, the matter was pending consideration before different forums, other than the ones situated within the State of Tripura.

5. Insofar as the tender subject matter of the present petition is concerned (C/33 of 2017), parties agreed to and bind themselves, subjecting themselves to the jurisdiction of the place where the tender was to be opened and/or agreement was to be signed. The said Clause reads as under:

"22. The appropriate Court of the place, where the Tender will be opened and/or the lease Deed/Agreement in respect of the said tender will be signed by the both the parties, will alone have the jurisdiction to decide any dispute arising out of and in respect of the said Tender and/or lease Deed/Agreement as the case may be;"

(emphasis supplied)

6. The instructions to the Tenderers also stipulated Clause 9, which reads as under:

"9. After finalization of tender, earnest money of all unsuccessful bidders would be refunded and in case of successful bidder, the EMD may be adjusted against the freight payable by the lease operator."

7. In their response, the respondents have also highlighted the clause contained in tender notice No. C/01 of 2018 conferring jurisdiction exclusively on the High Court of Guwahati, Assam.

8. The act and conduct of the petitioners in understanding the terms of the tender document/NIT is evidently clear. It is a matter of record that the petitioners submitted their tender at Lumding (in the State of Assam) where also it was to be opened, under the jurisdiction of Courts situate in Assam. The earnest money was deposited and withheld, as a consequence of another contract, which was awarded and executed inter alia within the Court having jurisdiction of Courts in Assam. It had nothing to do with the State of Tripura. With the non-acceptance of the tender document, no cause of action arose within this State. Also it is seen that petitioner No. 1 and its partners i.e. petitioner No. 2 and 3 are ordinarily residing in West Bengal and do not carry out business from or out of Tripura. Simply because petitioners were asked to furnish particulars of the bank where the money was to be deposited, which incidentally was at Agartala, would not confer any jurisdiction of the Courts here. It is not that they have bank account only at Agartala.

9. At the cost of repetition it be stated that the NIT was called for; to be and filed; money deposited at a place outside the jurisdiction of State of Tripura. Retention of the amount, illegal or otherwise, is also not within the State of Tripura, and does not pertain to any contract, entered into or to be executed within the State of Tripura. As such, no cause of action has arisen within this State.

10. Section 9 and Section 20 of CPC read as under:

"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.

[Explanation I].-A suit in which the right to property or to an office is contested is a suit of a civil nature, notwithstanding that such right may depend entirely on the decision of questions as to religious rites or ceremonies.

[Explanation II].- For the purposes of this section, it is immaterial whether or not any fees are attached to the office referred to in Explanation I or whether or not such office is attached to a particular place.].

20. Other suits to be instituted where defendants reside or cause of action arises. - 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 carries on business, or personally works for gain; or

(b) any of the defendants, where there are more than one, at the time of the commencement 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 the 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."

11. Inter alia considering the said provisions, the Apex Court in A.B.C. Laminart (P) Ltd. and another vs. A.P. Agencies, Salem, (1989) 2 SCC 163 has held that when the clause is clear, unambiguous and specific, accepted notions of contract would bind the parties and unless their absence of ad idem, other courts should avoid exercising jurisdiction. As regards construction of the ouster clause when words like "alone", "only", "exclusive" and the like have been used there may be no difficulty.

12. In Angile Insulations vs. Davy Ashmore India Ltd. and another, (1995) 4 SCC 153, the Apex Court held that normally that court also would have jurisdiction where the cause of action, wholly or in part, arises. But it will be subject to the terms of the contract between the parties. The citizen has the right to have his legal position determined by the ordinary Tribunal except, of course, subject to contract (a) when there is an arbitration clause which is valid and binding under the law, and (b) when parties to a contract agree as to the jurisdiction to which dispute in respect of the contract shall be subject. This is clear from Section 28 of the Contract Act. But an agreement to oust absolutely the jurisdiction of the court will be unlawful and void being against the public policy under Section 23 of the Contract Act. On the other hand, where there may be two or more competent courts which can entertain a suit consequent upon a part of the cause of action having arisen therewith, if the parties to the contract agreed to vest jurisdiction in one such court to try the dispute which might arise as between themselves, the agreement would be valid. If such a contract is clear, unambiguous and explicit and not vague, it is not hit by Sections 23 and 28 of the Contract Act.

13. In Hanil Era Textiles Ltd. vs. Puromatic Filters (P) Ltd., (2004) 4 SCC 671, the Apex Court held that after a careful observation of clause 17 of the agreement which says any legal proceedings arising out of the order shall be subject to the jurisdiction of the courts in Mumbai held that this clause is no doubt not qualified by the words like "alone", "only" or "exclusively". Therefore, what is to be seen is whether in the facts and circumstances of the present case, it can be inferred that the jurisdiction of all other courts except courts in Mumbai is excluded. Having regard to the fact that the order was placed by the defendant at Bombay, the said order was accepted by the branch office of the plaintiff at Bombay, the advance payment was made by the defendant at Bombay, and as per the plaintiff's case the final payment was to be made at Bombay, there was a clear intention to confine the jurisdiction of the courts in Bombay to the exclusion of all other courts. The Court of Additional District Judge, Delhi had, therefore, no territorial jurisdiction to try the suit.

14. In New Moga Transport Co. through its proprietor Krishanlal Jhanwar vs. United India Insurance Co. Ltd. and others, (2004) 4 SCC 677, it has been held that he intention of the parties can be culled out from use of the expressions "only", "alone", "exclusive" and the like with reference to a particular court. But the intention to exclude a court's jurisdiction should be reflected in clear, unambiguous, explicit and specific terms. In such case only the accepted notions of contract would bind the parties.

15. Shree Subhlaxmi Fabrics (P) Ltd. vs. Chand Mal Baradia and others, (2005) 10 SCC 704, in this case it was held that restriction of place of suing by an agreement is permissible where as conferral of jurisdiction by agreement on court not having jurisdiction is otherwise, held impermissible.

16. In Interglobe Aviation Ltd. vs. N. Satchidanand, (2011) 7 SCC 463, the court reiterated the principle laid down in A.B.C. Laminart (supra), where it held that any clause which ousts the jurisdiction of all courts having jurisdiction and conferring jurisdiction on a court not otherwise having jurisdiction would be invalid. It concluded that is now well settled that the parties cannot by agreement confer jurisdiction on a court which does not have jurisdiction; and that only where two or more courts have the jurisdiction to try a suit or proceeding, an agreement that the disputes shall be tried in one of such courts is not contrary to public policy. The ouster of jurisdiction of some courts is permissible so long as the court on which exclusive jurisdiction is conferred, had jurisdiction.

17. In Swastik Gases (P) Ltd. vs. Indian Oil Corpn. Ltd., (2013) 9 SCC 32, the intension of the parties needs to be looked at while analysing ouster clauses. The parties by stating that courts at Kolkata will have jurisdiction in a contract had impliedly excluded the jurisdiction the other courts. The very existence of the exclusion of jurisdiction clause in the Agreement would be rendered meaningless if not given its natural and plain meaning.

18. In Excel Dealcomm (P) Ltd. vs. Asset Reconstruction Co. (India) Ltd. and others, (2015) 8 SCC 219, the Apex Court in dealing with as to which court would have jurisdiction to entertain a suit if specifically mentioned in the agreement:

"17. Now, we shall consider as to which court has the jurisdiction to entertain and try the suit. Clause 5 of the Agreement entered into between the parties reads as under:

"The payment/cheque shall be drawn and made payable in Mumbai. The jurisdiction shall be Courts of Mumbai."

Clause 9(e)(viii) of the Agreements further reads as follows:

"Disputes, if any, shall be subject to the jurisdiction of Mumbai Court/Tribunals only"

18. It is clear from these two clauses that the intention of the parties to the Agreement was to restrict limitation to the forums/courts of Mumbai only. This Court in Swastik Gases P. Ltd. vs. Indian Oil Corporation Ltd., (2013) 9 SCC 32, has held as under:

"The very existence of a jurisdiction clause in an agreement makes the intention of the parties to an agreement quite clear and it is not advisable to read such a clause in the agreement like a statute. In the present case, only the Courts in Kolkata had jurisdiction to entertain the disputes between the parties."

19. Therefore, we are of the opinion that the Courts of Mumbai were granted ex

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clusive jurisdiction as per the Agreement and we find no reason to create any exception to the intention of the parties. 20. In view of the above-mentioned two findings that the present suit is a suit for land, and that the parties had granted exclusive jurisdiction to the Court of Mumbai, the jurisdiction of the Court at Calcutta is clearly ousted as per law. Thus, from the above conclusion it appears that the plaint will have to be returned by the Calcutta High Court as it does not have the jurisdiction. Therefore, we are of the view that the question of jurisdiction of the Debt Recovery Tribunal need not be answered. Consequently, this appeal is dismissed. The parties may proceed to take any appropriate measure in an appropriate forum as provided in law to enforce their rights." The Apex Court has laid down the principle, with which we are concerned. The parties can by an agreement confer jurisdiction upon a Court otherwise having jurisdiction, by ousting jurisdiction of other courts. The question is answered accordingly. 19. Hence, the issue stands adjudicated holding this Court not to have any jurisdiction. Accordingly, the petition is dismissed, reserving liberty to the petitioners to file the same before the Court having appropriate jurisdiction. 20. All issues on merit are left open. 21. Pending application(s), if any, also stands disposed of. 22. The lower Court records be send down forthwith.