TMI Blog2005 (3) TMI 801X X X X Extracts X X X X X X X X Extracts X X X X ..... NEIGRIHMS. The agreement was executed on 17.5.2000. HSCCI has signed the agreement on behalf of NEIGRIHMS, being its consultant. Said agreement was novated by an agreement dated 31.12.2003. 3. ABL received certain advance payments from NEIGRIHMS towards mobilization and equipment, shuttering etc. These payments received by ABL from NEIGRIHMS were to be secured, as per contract, by furnishing bank guarantees in favor of NEIGRIHMS. ABL was also to furnish a performance guarantee. Numerous guarantees were issued by the bankers of ABL in favor of NEIGRIHMS. All the bank guarantees were issued by the bankers of ABL from Delhi. 4. Since the petition did not state as to how, courts in Delhi would have territorial jurisdiction, vide order dated 13.1.2005, ABL was directed to file an affidavit disclosing as to in what manner, courts in Delhi would have territorial jurisdiction to entertain the present petition. NEIGRIHMS was permitted to respond to the said affidavit. In compliance with the order dated 13.1.2005, requisite affidavits have been filed. 5. As per the affidavit filed by ABL, agreement dated 17.5.2000 was executed at the registered office of HSCCI at New Delhi. Prior t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ritorial jurisdiction was shown to this court in reference to various authorities. 9. Let me start with the basic law. Residual section of the Code of Civil Procedure, Section 20, was the fulcrum on which arguments revolved. Not the whole section. Only Clause 'c' thereof was relied upon by the parties. Clause 'c' of Section 20 reads as under: 20. Subject to the limitations aforesaid, every suit shall be instituted in a court within the local limits of whose jurisdiction :- (a)...... (b)...... (c) The cause of action, wholly or in part, arises. 10. Since counsel for ABL referred to Article 226 of the Constitution of India, in the context of territorial jurisdiction, I may note the language of Article 226(2) of the Constitution of India. It reads as under:- 226(2). The power conferred by clause (I) to issue directions, orders or writs to any Government, authority or person may also be exercised by any High Court exercising jurisdiction in relation to the territories within which the cause of action, wholly or in part, arises for the exercise of such power, notwithstanding that the seal of such Government or authority or the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , bearing Suit No. 2357-A/1997 is not in context for the reason that I had to consider in that case the legality and legitimacy of the ouster/restrictive clause reserving jurisdiction to Courts in New Delhi. There can be no gain saying today that parties cannot agree to have disputes adjudicated a place which does not otherwise enjoy jurisdiction. xx xx xx xx 8. Primacy has been given to the place where the cause of action has substantially arisen, as is evident from the decision of the Hon'ble Supreme Court in South East Asia Shipping Co. Ltd. v. Nav Bharat Enterprises Pvt. Ltd., [1996]3SCR405 . The admitted position was that performance of the obligations and liabilities under the contract was to be carried out in Bombay. The Court found it wholly irrelevant that the subject Bank Guarantee had been executed at Delhi and transmitted for performance to Bombay and held that Delhi Courts did not possess jurisdiction to decide the disputes. Therefore, assuming for the sake of arguments that the contract in the present case had actually been executed in Delhi, Courts in Hyderabad would be the only proper Courts for purposes of invocation of jurisdiction since the cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of cause of action accrues within the jurisdiction of the court, the court will have jurisdiction in the matter. 18. The observations in the decision of the Hon'ble Supreme Court in South East Asia Shipping Company read in light of the decision of the Hon'ble Supreme Court in Kusum Ingots and Alloys judgment makes the legal position very clear, being that, even a small fraction of cause of action if accruing, within the jurisdiction of a court, vests the court with jurisdiction to entertain the suit. In this context, it may be noted that the words in part in Clause 'c' of Section 20 of the Code of Civil Procedure are not preceded by the word substantially'. In other words it cannot be read that in the context of cause of action, legislative intent is to read the word part' as 'substantial part'. 19. Learned counsel for the respondent also referred to the decision of a Division Bench of this court reported as 87 (2000) DLT 693 DLF Industries Ltd. Vs. ABN Amro Bank and Ors. It has to be noted that cause of action for purposes of invoking jurisdiction of this court as pleaded was the execution of bank guarantees at Delhi. No other fact was asser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said doctrine. While invoking the doctrine of forum convenience a court may refuse to exercise its discretionary jurisdiction notwithstanding that some part of cause of action has arisen within the territorial jurisdiction of the court. 26. In the instant case, it has to be noted that, HSCCI has acted as the consultant and most of the correspondence between the parties is between ABL and HSCCI. Registered office of HSCCI is at New Delhi. The bank guarantees have been addressed to HSCCI, though NEIGRIHMS is the beneficiary. Some of the letters invoking the bank guarantees have been issued by HSCCI. 27. Though NEIGRIHMS has asserted that the original agreement dated 17.5.2000 and the supplementary agreement dated 31.12.2003 were not executed at Delhi and were executed at the corporate office of HSCCI at Noida, it has to be noted that ABL has pleaded to the contrary. Unfortunately, neither agreement records the place where the same has been executed. This issue between the parties would require evidence. This court cannot treat the contract not being executed at New Delhi, more so when the registered office of HSCCI is at New Delhi as also the fact that the stamp paper on whi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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