Calcutta High Court
Romi Jaiswal vs Smt. Satya Bhama Jaiswal & Ors. on 30 November, 1998
Equivalent citations: (1999)3CALLT90(HC), AIR 1999 CALCUTTA 112, (1999) 3 ICC 294
Author: Amitava Lala
Bench: Amitava Lala
JUDGMENT
The Court
1. The defendant has taken out this application on 29th July, 1998 for the purpose of revocation of the leave under Clause 12 of the Letters Patent and plaint be taken off the file or the suit be dismissed with other consequential reliefs supported by an affidavit dated 14th July 1998.
The petitioner made two fold attack for the above i.e.
a) Suit is basically a suit for land;
b) Forum convenience or natural forum for the relief is the appropriate court in the State of Bihar;
2. It appears that the suit was instituted by the plaintiff as far back as on 13th November 1997 praying inter alia;
3. Leave Order 11 Rule 2 of the Code of Civil Procedure, 1908 and for the leave under clause 12 of the Letters Patent. 1785 for instituting the instant suit and prays for the following reliefs:-
a) A declaration that the partnership created under the Deed of Partnership dated September 15th, 1982 known as M/s. Sujata Picture Palace stood dissolved as on November 10th, 1997;
b) Alternatively that the said partnership be dissolved by a decree of this Hon'ble Court:
c) Injunction;
d) Receiver;
e) Accounts;
f) Attachment;
g) Costs;
h) Such further or other order and/or orders or direction or directions be passed as this Hon'ble Court may deem fit and proper.
4. Although there is an arbitration clause in the concerned agreement in connection with the suit but the parties by their conduct superseded such arbitration clause.
5. I have perused the recored and found that an interlocutory application was also made by the plaintiff as against the defendant/ petitioner on 9th December, 1997 praying amongst others appointment of Receiver and injunction in respect of the properties under schedule 'K' of the petition which is pending before this Court and even the petitioner took participation in such proceeding by filing affidavit therein.
6. The petitioner contended that although relief claimed in the plaint for dissolution of a partnership firm with certain consequential and alternative reliefs but upon going through the plaint it will appear that the plaintiff/respondent, in fact, sought for declaration of title of the immovable properties situate outside the Jurisdiction of this Court. The question of dissolution of partnership firm will come after the adjudication as to whether the properties at all belong to the partnership or not, so to say, declaration of title; therefore, suit will be hit by principles of "suit for land".
7. On principles of "suit for land" Mr. Mitra, learned senior Counsel appearing for the petitioner cited a Division Bench Judgment reported in AIR 1997 Calcutta 67 (Brijmohanlal Rathi v. Smt. Gita Devt Rathi & Ors.) to give an emphasis on the point that when a person claimed for a dissolution of firm caliming to be exclusive owner of the assets of the firm including immovable property, a dispute has to be there as to whether immovable property formed asset of the firm or not. In such a case the suit is for title and consequently a "suit for land" but not a suit relating to assets of firm nor for specific performance simplicitor. He also relied upon (Arjun Kanoji Tankar v. Santaram Kanoji Tankar) only to point out that unless any property declared that properties belonged to partnership such property cannot lose its character and become partnership property.
8. Therefore, in all. Mr. Mitra explained that declaration of title of the immovable properties situate outside the jurisdiction is the primary object of the plaintiff in the suit.
9. So far the question of 'natural forum' is conerned, this Court is much keen to know about and for the same called upon Mr. Mitra to make his much extensive argument on that score.
10. Mr. Mitra relied upon (Parasan v. Harnandrain Chitandas & Ors) to establish such point.
11. It appears therefrom that a Single Bench of this Court held that where in a suit for dissolution of partnership, the business is a running business and wholly situate outside the Jurisdiction, the defendant admittedly resided outside the jurisdiction and had never even come within the jurisdiction where the suit was instituted, the firm had a place of business outside the jurisdiction, all the books of account and all persons capable of proving them are all outside the Jurisdiction, and the only thing that happened within the Jurisdiction is the remote agreement of partnership, the cost of proving which cannot be comparable to the cost of proving the defence, the volume of evidence to be brought from outside the jurisdiction would be considerable if the action is tried in the jurisdiction where the suit was instituted, the balance of convenience is overwhelmingly in favour of the defendant/petitioner. Therefore, the place outside the jurisdiction is the natural forum for such a suit and the leave granted under clause 12 of the Letters Patent must be revoked in such a case. In addition thereto the Court also held that immovable property belonged to the plaintiff situated outside the jurisdiction and there is a prayer for delivery of possession. Therefore, the claim is hit by principle of "suit for land".
12. Upon understanding the submissions as made by the petitioner I have called upon the plaintiff/respondent to give the answer.
13. The respondent contended that out of the four parties including the plaintiff and defendants two are residing within the jurisdiction other two are residing outside the Jurisdiction. Parties, who are residing within the jurisdiction and claiming that suit is to be heard in this court, are holding 70% shares in the firm wherein others opposing such prayer are holding 30% shares in the firm. It is to be noted that the defendant/respondent No. 1 being mother of the parties supported the case of the respondent on the ground of her age and share being 40% in the firm. Secondly the deed of partnership in between the parties was executed within the jurisdiction at 4. Clive Road Hastings. Calcutta-23. Thirdly partnership has its office within the jurisdiction. Fourthly partnership firm has bank account within the jurisdiction. Lastly notice of dissolution of firm was served from within the jurisdiction.
14. Under these circumstances, it cannot be said that balance of convenience is overwhelmingly in favour of the defendant/petitioner to hold that other forum of Bihar is the natural forum for the purpose of hearing of the suit and leave granted under clause 12 of the Letters Patent by this court must be revoked.
15. The respondent further contended that both Calcutta and Ranchi may have jurisdiction and in that case it cannot be said that Jurisdiction overwhelmingly lying at Ranchi. Bare allegation will not serve the purpose. The respondent also cited a judgment reporte in 1994 (2) CHN 472 (Sambhu Prasad Agarwal v. I. C. D. S. Ltd. & Ors.) to establish that it is well established that the question of Jurisdiction must be decided on the allegation in the plaint/pleadings. This is the view of the Court which includes question of balance of convenience. A mere allegation of balance of convenience by the defendant would not be sufficient for the Court to revoke leave under clause 12 of the Letters Patent, would seem to suggest that the important thing is not allegation but satisfaction of the court that the balance of convenience was overwhelmingly in favour of the suit being tried in another court.
16. Mr. Mitter even in reply, in addition to distinguishing the legal proposition cited a judgment reported in (1978) 1 All ER 625 (Mac Shannon v. Rockware Glass Ltd. etc.) when this court allowed the same for the purpose of effective adjudication with the consent of the respondent upon granting leave to them to give reply to the same.
17. From the factual aspect of the case before House of Lords in England it appears that save and except registered office of the defendant company in England entire causes of action arose in Scotland. The plaintiff instituted the proceeding in England for the reasons that proceeding may be shorter, less expensive and on top of it he would be likely to get higher award of damages while on the other hand the defendant will have to incur extra expenses and inconvenience. House of Lords in England took judicial notice about Scots law and, therefore found there were grounds for thinking that damages in England would be higher and English legal proceeding shorter and less costly and accordingly stay was granted.
18. Prima facie. I am of the view that the above noted case has no application herein. Mere having a registered office or residence or head office in a jurisdiction can not give cause of action unless such office or offices have nexus or connection with the cause of action which I have already held in different arbitration proceedings. In the above noted case the party had proceeded on a concept but only having registered office in England when in the instant case, parties have proceeded here on a cause of action partly arising within the jurisdiction. Concept, cause of action and convenience are different and distinct from each other. If one has instituted a proceeding in a Jurisdiction on a concept not having cause of action therein, obviously the proceeding will have to be stayed. If slightest cause of action is available within the Jurisdiction on the basis of the pleading and court granted leave under clause 12 of the Letters Patent upon thereto, such leave cannot be revoked. So far the convenience is concerned balance of convenience overwhelmingly matters but not the part convenience.
19. According to me petitioners case is much more analytical in clause 13 than static clause 12 of the Letters Patent.
20. Scope of the letters patent is as follows:
a) Suit for land or other immovable property within the jurisdiction;
b) In all other cases, if the casue of action shall have arisen wholly;
c) In case the leave of the Court shall have been obtained if the cause of action arising in part.
21. There is no scope of analysis of natural forum or forum conveience or balance of convenience in hearing the suit excepting those above.
22. For the purpose of strengthening his case, the plaintiff/respondent argued that even if the immovable properties situate outside the jurisdiction of the Court but being the properties of the partnership are to be considered as movable properties and thereby principles of "suit for land" is in-applicable in the instant case. It has further emphasized that court should proceed on the basis of the plaint as it is but not to be over read by interpretation of the defendant for the purpose of coming to the conclusion as to whether this court has jurisdiction or not.
23. In this context Mr. R. Bachawat, learned Advocate while assisting Mr. P.K. Roy, learned senior counsel placed a Division Bench judgment before this Court (Md. Hassen Hashmi v. Sm. Kaberi Roy & Ors.) wherein it has decided that in a case of dissolution of partnership firm, suit for accounts and realisation of movable properties suit will not be barred on ground of certain immovable properties belonging to firm situated beyond territorial jurisdiction of the court.
24. There are various similarites in between the above reported judgment and the present case herein. Above all the reported Judgment has distinguishing feature with earlier judgment and cited by the petitioner. Court has to follow the later judgment.
25. The observation of the Division Bench under the above judgment is where suit was filed by a partner of the firm for accounts and for realistion of certain movable properties belonging to him, seeking declaration that the business carried on in the name of the firm stood dissolved, the said suit would not be barred as without jurisdiction on ground that certain immovable properties belonging to the firm were situtated beyond the territorial jurisdiction of the court in which the suit was filed. The suit concerned is primarily a suit for accounts and for realisation of movable properties, namely, the interest of the plaintiff in the partnership assets, which is in the nature of movable assets. It does not really matter if the partnership has immovable properties whether within or outside the jurisdiction of the Court. So far as the interest of the partner is concerned, it is in the nature of movable property. Futhermore, it cannot be accepted that in a suit for accounts of a partnership, the Court will have jurisdiction if the property is admitted to belong to the partnership and that the Jurisdiction of the court can be taken away by the defendant by disputing the title. Either the court has jurisdiction or it does not have jurisdiction. The Jurisdiction of the court does not depend on the volition of the defendant. In a suit for accounts the nature of the interest of a partner has been held to be movable even though partnership owns immovable properties outside the jurisdiction.
26. Upon going to the aforesaid two Division Bench Judgments I am of the view that Court should proceed on the basis of the primary relief claimed by the plaintiff in the suit. Here in the case it appears that suit is dissolution of firm, accounts etc. which has consequential effect in such a question of dissolution of firm. Even in a case of dissolution of firm the defendant/petitioner can take the plea disputing the title of the plaintiff as to the immovable properties situate outside the Jurisdiction of the court. Therefore, it cannot be said that the party is remedyless if the Juresdiction of this Court is invoked.
27. The plaintiff/respondent also relied on a judgment (Shyam Sundar Shaw v. Netai Chand Shaw) to establish that share in partnership business is movable property. He further cited a Division Bench Judgment (Tilokram Ghosh & Ors. v. Smt. Gita Rani Sadhukhan & Others) and relying upon head note 'E' therein contended a suit for dissolution of partnership firm and accounts cannot be treated as a suit for land even if its assets consist of immovable properties, and, therefore, a suit for dissolution and accounts is maintainable in a court though the court has no territorial jurisdiction over the assets of the firm which are immovable properties.
28. In the premises it is needless to mention or repeat that if the court proceeds on the basis of the plaint, primarily the suit is to be construed as partnership action but not for declaration of title of the immovable property situate outside the jurisdiction unless and until, in a defence in the suit in merit it is decided that immovable properties herein are not properties of partnership firm.
29. In addition to deal with the points as above the plaintiff/respondent has also raised point of delay. Mr. Roy in arguing the matter on behalf of the respondent cited two Judgments in connection thereto. One of such judgment is (Chittaranjan Mukherji v. Barhoo Mahto) and another is ( State of Punjab v. A. K. Raha(Engineers) Ltd.). Basic criterion for showing such Judgment is, delay defeats the cause of revocation of leave granted under clause 12 of the Letters Patent. In one of such Judgments of 3 judges Bench of Supreme Court held that where the party applying for the revocation of leave granted under clause 12 to file a certain suit in Calcutta had not only acquiesced in the steps taken by the plaintiff to carry forward the progress of the suit incurring considerable expenses but, made use of the existence of the suit to obtain such interlocutory reliefs as he thought would be to his own advantage, at the hands of the court at Calcutta. Therefore, it was held that the proceedings In the suit had been allowed to reach a stage where it would result in grave Injustice if the court were to hold that the forum convenient was not Calcutta but Bihar and revoke the leave on that ground.
30. Therefore, taking into the totality of the arguments advanced by the parties i am of the view that the application cannot succeed.
As a result whereof this application fails and thereby dismissed.
No order is passed as to costs. Prayer for stay is made, considered and refused.
All parties are to act on a signed copy minute of the operative part of the order.
31. Application dismissed