2002 (5) TMI 858 - HC - Companies Law

Summary

Issues Involved:
1. Territorial jurisdiction of the Calcutta High Court.
2. Waiver of objection to territorial jurisdiction.
3. Interpretation of Article 226(2) of the Constitution of India.
4. Concept of cause of action in writ petitions.

Issue-wise Detailed Analysis:

1. Territorial jurisdiction of the Calcutta High Court:
The primary issue was whether the Calcutta High Court had the territorial jurisdiction to entertain the writ petition. The petitioners argued that part of the cause of action arose within the jurisdiction of the Calcutta High Court because the communication rejecting their request was received at their registered office in Calcutta. The respondents contended that all relevant actions and decisions took place outside Calcutta, specifically in New Delhi, and thus, the Calcutta High Court lacked jurisdiction.

The Court examined the facts and found that the petitioners' main grievance was against the approvals granted by the Central Government, which were issued and communicated outside Calcutta. The mere receipt of the rejection letter in Calcutta did not constitute a significant part of the cause of action. The Court concluded that no part of the cause of action arose within its territorial jurisdiction.

2. Waiver of objection to territorial jurisdiction:
The petitioners argued that the respondents had waived their right to object to the Court's jurisdiction by participating in the proceedings without raising the issue initially. The Court analyzed previous judgments, including the Supreme Court's decision in Hira Lal Patni v. Sri Kali Nath, which established that objections to local jurisdiction can be waived if not raised at the earliest opportunity.

The Court found that the respondents had raised the objection to jurisdiction at the earliest possible stage during the hearing and had not participated in the proceedings in a manner that would constitute a waiver. Thus, the respondents were entitled to challenge the Court's jurisdiction.

3. Interpretation of Article 226(2) of the Constitution of India:
Article 226(2) allows High Courts to issue writs to any person or authority outside its jurisdiction if the cause of action arises wholly or in part within its jurisdiction. The Court referred to the Supreme Court's interpretation in cases like Swaika Properties and ONGC v. Utpal Kumar Basu, which emphasized that the cause of action must be an integral part of the dispute and not merely incidental or remote.

The Court concluded that the rejection letter received in Calcutta was not an integral part of the cause of action, as the primary dispute centered around the approvals granted in New Delhi. Therefore, the Calcutta High Court did not have jurisdiction under Article 226(2).

4. Concept of cause of action in writ petitions:
The Court analyzed the concept of cause of action, referring to various judgments that defined it as the bundle of essential facts necessary for the plaintiff to succeed. The Court noted that the cause of action must be material and integral to the dispute.

In this case, the Court found that the petitioners' cause of action arose from the approvals granted by the Central Government, which occurred outside Calcutta. The rejection letter received in Calcutta did not form a significant part of the cause of action. Consequently, the Court held that it lacked the territorial jurisdiction to entertain the writ petition.

Conclusion:
The Court dismissed the writ petition on the grounds of lack of territorial jurisdiction, emphasizing that the cause of action did not arise within the territorial limits of the Calcutta High Court. The Court also clarified that it had not considered the merits of the petition and allowed the petitioners to approach the appropriate forum for their grievances.