Calcutta High Court
Carbon Management Consulting Private ... vs Yash Paper Limited on 25 April, 2017
Equivalent citations: AIR 2017 (NOC) 977 (CAL.)
Author: Shivakant Prasad
Bench: Shivakant Prasad
IN THE HIGH COURT AT CALCUTTA
ORDINARY ORIGINAL CIVIL JURISDICTION
ORIGINAL SIDE
Present: The Hon'ble Justice Shivakant Prasad
CS 19 of 2011
CARBON MANAGEMENT CONSULTING PRIVATE LIMITED
Versus
YASH PAPER LIMITED
For the Plaintiff : Mr. Sakya Sen, Adv.
Ms. Labyanashree Sinha, Adv.
For the defendant : Mr. Ratnanko Banerjee, Sr. Adv.
Ms. Nikita Jhunjhunwala, Adv.
Heard on : 05.04.2017
C.A.V. on : 05.04.2017
Judgment on : 25.04.2017
This is to consider an application filed on behalf of the defendant company
for revocation of leave granted under Clause 12 of the Letters Patent, 1865 and to
return the plaint filed in CS No.19 of 2011 to the plaintiff to be filed before the
appropriate court. The plaintiff instituted the suit before this court obtaining
leave under Clause 12 of the Letters Patent of 1865 alleging that a part of cause
of action has arisen within the jurisdiction of this Hon'ble Court and thereby
sought to invoke the jurisdiction of this court, inter alia, on the ground that the
proposal of the plaintiff dated 25th August, 2005 being Annexure-A to the plaint
had culminated into an agreement dated 27th August, 2005 being Annexure-B to
the plaint and part payment in terms of the agreement was received at the
corporate office of the plaintiff at Kolkata within the jurisdiction of this court but
it has been admitted at the same time that part of the alleged cause of action has
arisen at Faizabad outside the jurisdiction. It would appear that as per the
proposal dated 25th August, 2005 Annexure-A of the plaintiff to the plaint the
defendant had accepted the same in its office at Faizabad, Post Office
Darshannagar, Uttar Pradesh outside the jurisdiction of this court.
The Work Order dated 27th August, 2005 which the plaintiff had relied upon
as an agreement binding on the parties contained a forum selection clause which
reads thus:
"Note: All disputes/litigations will be subject to Court of Faizabad."
The said Work Order has been made a part of the plaint as Annexure-B
admitting the contract as accepted at Faizabad outside jurisdiction of this Court.
It is contended by Mr. Ratnanko Banerjee, learned counsel appearing on behalf of the
applicant /defendant that in view of the agreement between the parties all
disputes/litigations between them would be subject to the jurisdiction of the
Court of Faizabad in the province of Uttar Pradesh and the entire cause of action
as pleaded in the plaint by the plaintiff is at Faizabad. Therefore, this Court has
no jurisdiction to try and determine the issues involved in the suit and the leave
granted by this Court under Clause 12 of the letters patent 1865 is liable to be
revoked.
It is evident from the averment made in Paragraph-6 of the plaint that the
plaintiff sent the proposal to the defendant company on 25th August, 2005 for
consideration and the proposal being accepted, a Work Order was accepted and
signed on 27th August, 2005 by which the plaintiff had agreed to develop the
project and the defendant had agreed to appoint the plaintiff as a consultant for
the said project.
The cause of action as pointed out in the averment at Paragraph-36 of the
plaint is that the defendant made part payment from Faizabad and committed
breach by non-payment from Faizabad outside the jurisdiction aforesaid and the
notice of termination of liability was issued from Faizabad and received at the
office of the plaintiff at Kolkata within the jurisdiction of the Court. It would
reveal from the said Work Order accepted by the parties that the parties had
selected a forum for all disputes/litigations arising between the parties, to be
subject to the jurisdiction of court of Faizabad.
The question, which fell for consideration before this Court is as to whether
the note given at the foot of the work contract can be construed as forum
selection clause in the agreement between the parties vide Work Order dated 27th
August, 2005.
It would be apt to reproduce the provision of Clause 12 of Letters Patent
which reads thus:-
"Original jurisdiction as to suits:- And We do further ordain, that the said
High Court of Judicature at Fort William in Bengal, in the exercise of its
ordinary original civil jurisdiction, shall be empowered to receive, try, and
determine suits of every description, if, in the case of suits for land or
other immoveable property, such land or property shall be situated, or in
all other cases if the cause of action shall have arisen, either wholly, or,
in case the leave of the Court shall have been first obtained, in part,
within the local limits of the ordinary original jurisdiction of the said High
Court, or if the Defendant at the time of the commencement of the suit
shall dwell, or carry on business, or personally work for gain within such
limits; except that the said High Court shall not have such original
jurisdiction in cases falling within the jurisdiction of the Small Cause
Court at Calcutta, in which the debt or damage, or value of the property
sued for, does not exceed One hundred rupees."
It would emerge from the plaint itself that the address of the defendant is
at Faizabad the project under the agreement under Work Order was set up at
Faizabad all the documents pertaining to the said project and records are at
Faizabad in respect of which agreement the plaintiff has complained alleged
breach of contract on the part of the defendant which took place at Faizabad the
electronic mail dated 10th June, 2008 in respect of which the plaintiff has sought
for declaration claiming damage from the defendant was issued by the Vice
President of the defendant company who resides and carries on business at
Faizabad outside the jurisdiction of this Court.
The provision under Clause 12 of Letters Patent reflects that this Court in
exercise of its ordinary civil jurisdiction will have the power to receive, try and
determine (1) the suits for land or movable or immovable property if such
property is situated within the local limits of original jurisdiction of the High
Court; or (2) all other cases (a) if the cause of action has arisen wholly within the
local limits of the ordinary original jurisdiction of the High Court; (b) if prior leave
of the court has been obtained and the cause of action has arisen in part within
the local limits of the ordinary jurisdiction of the High Court: or (c) if the
defendant dwells or carries on business or personally works for gain within such
limits.
I find on the plain reading of the plaint that the defendant dwells and
carries on business and personally works for gain at Faizabad in Uttar Pradesh
which is beyond the territorial limits of this High Court.
Mr. Sakya Sen learned counsel for the plaintiff/opposite party submitted
that the plaintiff has rendered intellectual service to the defendant from Kolkata
following mutual discussion which ultimately culminated into execution of the
contract dated 27th August, 2005 in Kolkata. That the shipments of large
quantities of documents to the defendant to the authorities in charge of
validating the project and the Belgian Government were made from the office of
the Kolkata and that with the leave of the court under Clause 12 of the Letters
Patent the suit was filed. It is specifically submitted that parties did not confer
exclusive jurisdiction in Faizabad Court to decide the dispute arising by and
between the parties.
Now coming back to the issue as to whether there is form selection by and
between the parties to the suit in their agreement is a matter of decision before
this Court. Admittedly the plaintiff/opposite party relied on the work order dated
27th August, 2005 which bears a note with regard to the forum selection that any
dispute or litigation arisen between the parties out of the work contract would be
subject to the jurisdiction of Faizabad Court. In this context Mr. Ratnanko
Banerjee for the petitioner/defendant has relied on a decision of [House of
Lords] in case of Hood appellant vs. Anchor Line (Henderson Brothers),
Limited wherein it has been discussed and held as under:
"In answer to an action be a passenger against a steamship company for
damages for personal injuries alleged to have been sustained through the
negligence of the company's servants in the course of a voyage from New
York to Glasgow in a steamship belonging to the company the defenders
pleaded a condition in the pursuer's ticket limiting their liability for injury
to passengers to 10l. The ticket was purchased at the defenders' New
York office by one of the pursuer's clerks, who, on payment of the
passage money, received in exchange a ticket enclosed in an envelope,
on the front of which was printed in capital letters a notice requesting the
passenger to read the conditions of the enclosed contract. The ticket
contained on its face a printed notice that it was issued subject to the
conditions thereinafter set out (which included the condition in question)
and at the foot a printed request to the passenger to read carefully the
above contract. Neither the pursuer nor his clerk was aware of the
conditions: -
Held, that the defenders had taken all reasonable steps to bring to the
knowledge of the pursuer the existence of the conditions and that he was
bound by them".
In that context question raised was as to whether the appellant had
actually knowledge of the condition and it was observed in the following line,
"I think ordinary people do look to see what bargain they are getting, and
should be taken as bound to have done so and as precluded from saying
that they did not know".
The question raised in the appeal was whether a condition limiting the
liability of a steamship company in respect of injury to a passenger in one of their
vessels had been assented to by the passenger so as to bind him. It was further
observed in the cited decision as under:-
"The sole question is what is the contract between the parties. It is the
duty of the passenger when he is tendered a ticket to see that he has got
what he has bought. It is said that the booking clerk ought verbally to
notify the passenger that there are special conditions, but the answer is
that that is not business. The written word is as good as the spoken
word for the purpose of bringing to the passenger's notice the existence of
the conditions. Here the respondents took reasonable and sufficient steps
to draw the attention of the appellant to the conditions on the ticket. As regards onus, there is no obligation on a steamship company to carry passengers at all, and so far the position of a steamship company differs from that of a railway company, for in the latter case there exists a statutory code applicable to such matters. There is here no legal presumption ab ante of what the contract is going to be, and no question of Onus arises.
Mr. Ratnanko Banerjee learned counsel for the petitioner/defendant has also relied on the authority of Swastik Gases Private Limited vs. Indian Oil Corporation Limited reported in (2013) 9 Supreme Court Cases 32 wherein the short question that arose for consideration before the Hon'ble Supreme Court was whether in view of Clause 18 of the Consignment Agency Agreement the Calcutta High Court had exclusive jurisdiction. It has been held when contract specifies jurisdiction of courts at a particular place and such courts have jurisdiction to deal with said matter, inference is that parties intended to exclude all other courts. Per Hon'ble Justice M.B. Lokur it has been observed thus:-
"The very existence of the exclusion of jurisdiction clause in the agreement would be rendered meaningless were it not given its natural and plain meaning. The use of words like 'only', 'exclusively', 'alone' and so on are not necessary to convey the intention of the parties in an exclusion of jurisdiction clause of an agreement. Therefore, I agree with the conclusion that jurisdiction in the subject matter of the proceeding vested, by agreement, only in the courts in Kolkata.
In the jurisdiction clause of an agreement, the absence of words like 'alone', 'only', 'exclusive' or 'exclusive jurisdiction' is neither decisive nor does it make any material difference in deciding the jurisdiction of a court. 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".
In the cited decision reference to Hakam Singh vs. Gammon (India) Ltd. reported in (1971) 1 Supreme Court Cases 286 has been made and the observation made in Paragraph-21 has been reproduced thus:
"......When the clause is clear, unambiguous and specific accepted notions of contract would bind the parties and unless the absence of ad idem can be shown, the 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. Even without such words in appropriate cases the maxim expressio unius est exclusio alterius - expression of one is the exclusion of another
- may be applied. What is an appropriate case shall depend on the facts of the case. In such a case mention of one thing may imply exclusion of another. When certain jurisdiction is specified in a contract an intention to exclude all others from its operation may in such cases be inferred. It has therefore to be properly construed".
Taking cue from the observation in the cited decisions, viz.,Hood's Case & Swastik Gases Pvt. Ltd. Case (supra) I am of the view that when the plaintiff/opposite party relying on the work order/contract for carrying out the project contained the Note as to the forum selection, it was well within the knowledge of the plaintiff with regard to the condition embodied therein inasmuch as the said work contract has been produced before the court by the plaintiff/opposite party himself claiming a decree based on that. Therefore, it cannot be said that the Note given in the Work Order at the foot of it relating to form selection in regard to the dispute or litigation to be referred to the jurisdiction of the court of Faizabad was the subsequent incorporation of the clause in the Work Order by the defendant without the knowledge of the plaintiff.
Per contra, Mr. Sakya Sen, learned counsel appearing for the plaintiff/opposite party also referred to a decision in case of Mayar (H.K.) Ltd. & Ors. vs. Owners & Parties, Vessel M.V. Fortune Express & Ors. reported in (2006) 3 Supreme Court Cases 100 and invited my attention to head note 5.
In the said case the defendant had filed an application purported to be under Order 7 Rule 11 of the Code of Civil Procedure, 1908 alleging therein that the suit filed by the plaintiffs is liable to be dismissed in limine and as a consequence thereof the bank guarantee is liable to be released, on the grounds that as per the Clause 3 of the Bill of Lading (for short "BOL") the court having jurisdiction to entertain the suit, is the court of the carrier's country and thus the Calcutta High Court has no jurisdiction to entertain the suit.
It has been observed in Paragraph 19 thus:
"The allegations in the plaint are to the effect that the parties have entered into a contract on 7-1-2000 to carry on board the vessel MV Fortune Express under the six split bills of lading 642 logs from the port of Sarawak, Malaysia for discharge at the port of Calcutta, India. As per stowage plan, 578 logs were lying on the deck of the vessel. At the time of the discharge of the cargo lying on the deck of the vessel, it was found that 456 logs out of 578 logs were missing and had been short-landed. The plaintiffs claimed a decree for the proportionate value of 456 logs, port and other charges, custom duty and proportionate insurance payment. As per the plaintiffs' allegation, the logs, which were to be carried on the vessel owned by the defendants, had not been delivered at the port of destination. Thus, all the material facts on the basis of which the plaintiffs claimed the decree are alleged in the plaint. As the logs were not delivered at the port at Calcutta, the port of destination, the part of cause of action arose within the jurisdiction of the Calcutta Court and, thus, the suit filed by the plaintiffs at Calcutta was maintainable it may be pleaded by the defendants in their written statement that the Calcutta High Court has no jurisdiction on account of clause 3 of BOL. For the purpose of the cause of action, it was not necessary for the plaintiffs to plead the ouster of the jurisdiction of the Calcutta Court. In fact, it was for the defendants to plead and prove the ouster of the jurisdiction of the Calcutta Court and conferment of the jurisdiction in the Singapore Court alone. On a bare reading of clause 3 of BOL, it is clear that any dispute arising under BOL shall be decided in the country where the carrier has its principal place of business and the law of such country shall apply except as provided elsewhere in BOL. Therefore, the exclusion clause refers to the jurisdiction of a court where the carrier has its principal place of business. Unless and until it is established that the defendant carrier has its principal place of business at Singapore, the exclusion clause has no application. Simply because in the cause-title of the plaint, the plaintiffs have described Defendant 2 Trustrade Enterprises PTE Ltd. to be carrying on business at Singapore, would not ipso facto establish the fact that the principal place of business of Defendant 2 (the respondent herein) is/was at Singapore to exclude the jurisdiction of the Calcutta Court which admittedly has the jurisdiction to try the suit. Therefore, the absence of reference of clause 3 of BOL, in the pleadings cannot be said to be suppression of the material fact as the question of jurisdiction would be required to be adjudicated and decided on the basis of the material placed on record at the trial".
It was held in that case that unless and until it is established, after sufficient material is placed on record at the trial that the defendants have their principal place of business at Singapore, exclusion clause had no application and the court cannot arrive at a finding of a particular place of business at the preliminary stage of hearing of this suit. In my considered view the factual aspect of this case and the proposition laid therein and ratio of decision is quite distinguishable from the facts and circumstances of the instant case and is not apposite to the case.
Yet, Mr. Sakya Sen also relied on a decision of Sopan Sukhdeo Sable & Ors. vs. Assistant Charity Commissioner & Ors. reported in (2004) 3 SCC 137 wherein the question was whether Sections 50 and 51 of Bombay Public Trusts Act, 1950 are applicable to question relating to continuance and period of tenancy wherein Trust is a lessor so as to oust jurisdiction of Civil Court with regard thereto under Section 80. In the said judgment the stand of the plaintiff/appellants essentially was that the tenancy was for a period of 11 years and not for 11 months as claimed by the trust. An application was filed by the trust raising a preliminary plea that the plaint was liable to be rejected under Order 7 Rule 11 of the Code and with reference to Section 80 of the Bombay Public Trusts Act, 1950 it was urged that no civil court had jurisdiction to decide or deal with any question which by or under the Act is to be decided or dealt with by any officer or authority under the Act and in respect of which the decision or order of such officer or authority has been made final and conclusive. The preliminary issues (a) whether the suit was liable to be rejected under Order 7 Rule 11 of the Code for want of cause of action and (b) whether the suit was tenable against all the defendants. The findings in respect of the preliminary issues were recorded against the plaintiffs with the findings that the plaint did not disclose any cause of action and also in view of the specific provisions of an Act, the jurisdiction vests only with the District Court to give directions to the Commissioner and in any event Section 80 of the Act took away jurisdiction of the civil court and the plaint was rejected. The matter was carried in second appeal before the High Court and the High Court accepted the plea of trust and dismissed the second appeal affirming the conclusion arrived from the courts below. The Hon'ble Supreme Court in the cited decision was of the opinion that looking into the nature of the dispute it would be appropriate if the trial court makes an effort to complete the trial within 6 months from the date of the judgment and the parties were accordingly directed to cooperate for the disposal of the suit.
Thus, the above cited decision relied by Mr. Sakya Sen is no help to the plaintiff/opposite party as the same is not well nigh within facts and circumstances of the instant case in my considered view.
In the context of the discussion above relying on the decision in Hood's case (supra), I am of the view and accordingly hold that at the foot of the work contract giving out a forum selection for the dispute and the litigation between the parties to be subjected to the court at Faizabad and the plaintiff relying on the said work contract bearing a forum selection had every knowledge and had intended to exclude all other courts and further in respectful consideration of the decision in case of Swastik Gases Private Limited (supra), although, cause of action is a bundle of facts in a suit and part of it is averred to have arisen in Kolkata, nevertheless, the parties are bound by their agreement which contained a forum selection clause for any dispute or litigation arising between them to the subject to the court at Faizabad. It shows that parties to the suit chose the designate court and location of the court where they would have their legal dispute decided.
I find that this court has no jurisdiction to entertain the suit as the parties have established a place of jurisdiction of the court for any dispute or litigation to be decided arising out of the work contract subject to Faizabad Court in view of forum selection clause. Consequently, leave granted under Clause 12 of the Letters Patent, 1865 stands revoked and the plaint in CS No.19 of 2011 is accordingly rejected with liberty to the plaintiff/opposite party to approach the competent court of law at Faizabad in U.P. as intended by the plaintiff and the defendant vide 'Note' to the Work Order dated 27th August, 2005. There shall be no order as to costs.
Department and parties to act on the signed photocopy of this judgment.
(SHIVAKANT PRASAD, J.)