Bombay High Court
Union Of India Through Secretary, Govt. ... vs M/S. H. Candolkar & Sons & Others on 4 July, 1997
Equivalent citations: 1998(2)BOMCR874
Author: R.M.S. Khandeparkar
Bench: R.M.S. Khandeparkar
ORDER R.M.S. Khandeparkar, J.
1. This is a revision application against the Order dated 23rd October 1996 passed in Special Civil Suit No. 208/94/A by the Civil Judge, Senior Division at Panaji. By the impugned Order the trial Court had held that it had jurisdiction to try and entertain the application filed by the respondent's herein under section 8 read with section 20 of the Arbitration Act, 1940 against the petitioner. From the pleadings in the application filed before the trial Court it appears that some dispute had arisen in relation to the execution of the work tendered to the respondents under Work Order dated 3rd October 1992. Undisputedly the work order was issued at Nasik, State of Maharashtra and the work consisted of construction of 6 'B' type and 6 'C' type staff quarters for postal Civil Division at Ratnagiri, again within the Slate of Maharashtra. The trial Court, observing that as per the Explanation to section 20 of Civil Procedure Code the petitioners 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 and that the petitioner No. 5 can be deemed to carry on business where it has a subordinate office irrespective of nature of work that is actually carried on, held that the Civil Court at Panaji had jurisdiction to entertain the said application. Aggrieved, the petitioners have preferred the present revision application.
2. This Court in the matter of Union of India v. M/s. Ajit Mehta and Associates, Pune and others, held in clear terms that the expression 'carries on business' in section 20(a) of the Civil Procedure Code, when used in reference to the State or the Government, does not refer to all its activities but only the commercial activities, if there are any. Indeed in cases where the activity is not of a commercial nature, the suit must be filed against the Government at the place where the cause of action arises wholly or in part. It is further observed in the said case that even where the activity is of commercial nature, the suit has to be filed either at the principal place of business or the principal office, which is Delhi in the case of Union of India, or at the place where the cause of action arises wholly or in part. In the present case, the work order was issued at Nasik and the respondents entered into an agreement for the construction in question with the petitioners also at Nasik.
3. Having realized the difficulty faced pursuant to the judgment of this Court in Union of India v. M/s. Ajit Mehta and Associates, Pune and others (supra), Shri Menezes, learned advocate appearing for the respondents, sought liberty of this Court to withdraw the Arbitration Application filed by the respondents under section 8 read with section 20 of the Arbitration Act, 1940 in the trial Court and also has filed an application to the effect that the respondents be permitted to withdraw the said application being Special Civil Suit No. 208/94/A alongwith Civil Miscellaneous Application No. 27/1996/A, to be presented in a Court of proper jurisdiction. Shri S.R. Rivenkar, the learned Addl. Standing Counsel appearing for the petitioners, under instructions from the petitioners herein, state that the petitioners have no objection for grant of the relief prayed for in the said application in terms of Order VII, Rule 10 of Civil Procedure Code.
4. I am also informed that the petitioners have already referred the matter to arbitration to an Arbitrator of their choice appointed in terms of the agreement between the parties, though according to the respondents, it has been done beyond the period of limitation. It was in this respect that the respondents had sought the relief of injunction against the said Arbitrator in the proceedings before the trial Court. I am further informed that the trial Court by an interim order had stayed the proceedings before the said Arbitrator appointed by the petitioners. Shri Menezes submits that the said interim relief granted be allowed to remain in force for a period of 2 weeks so as to enable the respondents to present the application alongwith the Miscellaneous Application to the Court of proper jurisdiction and to move for necessary interim relief from such Court.
5. Since it is apparent from the records that the Civil Court, Panaji has no jurisdiction to entertain the application filed by the respondents and since the prayer for withdrawal of the said application alongwith the Miscellaneous Application there with is not objected to by the petitioners, the respondent herein should be allowed to withdraw the said application alongwith the Miscellaneous Application referred to above from the trial Court in order to enable them to present it in the Court of proper jurisdiction. The trial Court is accordingly directed to pass appropriate order in terms of Order VII, Rule 10 C.P.C. in order to enable the respondents to withdraw the application and present the same in the Court of competent jurisdiction.
6. As regards the interim relief, it is not possible to grant any such interim relief in the present proceedings. It is clear that the trial Court had no jurisdiction to entertain the main application under section 8 read with section 20 of the Arbitration Act, 1940, and, therefore, it goes without saying that the trial Court had no jurisdiction to grant any interim relief. Moreover, in the instant case the respondents have preferred to withdraw the main application on the basis that the said application is to be filed in a Court of proper jurisdiction and that the Court of Panaji has no jurisdiction to entertain the same. In such circumstances it is not possible to grant any relief prayed for by the respondents. However, this shall not preclude the Arbitrator already appointed by the petitioners from staying the proceedings before him till the respondents are able to present the main application before the Court of competent jurisdiction.
7. In the circumstances nothing survives in Civil Application No. 28 of 1997 and hence the same is disposed of in above terms. There should be no order as to costs.
8. Petition allowed with directions.