Delhi District Court
M/S Hdfc Ltd vs Mrs Usha Rani on 1 May, 2007
IN THE COURT OF SH. BABU LAL : ADDL. DISTRICT JUDGE
DELHI
S-157/05
M/s HDFC Ltd Plaintiff
Versus
1 Mrs Usha Rani
2 Mrs Hina Victor Defendants
ORDER
1. Vide this order, I shall dispose of leave to defend application and objection regarding territorial jurisdiction of this court to entertain the present suit. Facts leading to filing of the present application are that plaintiff has filed a suit for recovery of Rs 5,20,166 against defendants alleging that defendant No 1 had allegedly approached the plaintiff for grant of home loan of Rs 4,50,000 which the plaintiff sanctioned. Loan documents were allegedly executed by the defendant No 1 in favour of plaintiff at Ghaziabad. Defendant No 2 is alleged to have signed letter of guarantee at Ghaziabad. It is alleged that as per agreement, defendant No1 was to repay the loan in monthly installment spread over 180 months with interest @ Rs 10.50% per annum. It was also agreed that in case of default or delay in making repayment of EMI, additional interest @ 18% per annum was to be paid by the defendants. Defendant No 1 is alleged to have initially paid few EMIs but thereafter he committed default and as on 30.4.05, as sum of Rs 5,20,166 has become due and payable. Plaintiff is alleged to have sent notice of demand to the defendants calling upon them to make payment of amount due 1 but in vain, therefore, present suit has been filed. A decree in the sum of Rs 5,20,166 agianst both the defendants with pendente lite and future interest @ 18% per annum has been prayed for.
2. Summons of the suit were sent to the defendants and defendants effected their appearance, however, leave to defend application was filed on behalf of defendant No 2 wherein preliminary objection was taken that this court has no jurisdiction to entertain the suit as cause of action wholly arose in Ghaziabad. Case of defendant No 2 is that she was only guarantor in the present suit and defendant had obtained the loan against collateral security. It is alleged that defendant No 1 is a Govt Servant and can pay back the loan and that she is only liable to pay the amount in case defendant No 1 does not pay back the loan amount. Leave to defend has been prayed for.
3. In reply to leave to defend, it is alleged that plaintiff had initiated and issued cancellation notice of loan agreement through it is submitted counsel from Delhi, therefore, this court has territorial jurisdiction to entertain the present suit. On merits, it is alleged that defendant No 1 had taken home loan and defendant No 2 stood guarantor and his liability is co extensive with that of defendant No 1. It is alleged that there is no substantial defence with the defendant to contest the suit. Dismissal of the leave to defend has been prayed for.
4. In this case, the main ground raised by defendant No 2 is that this court has no territorial jurisdiction to entertain the present suit. None has appeared on behalf of defendant No 1 or defendant no.2 to argue the case.
5. The basis to file the suit in Delhi and as alleged in para 2 No 18 of the plaint are that the cheque of loan amount was issued by the plaintiff at New Delhi. Secondly, it is alleged that EMIs issued by defendants have been dishonoured at Delhi, therefore, this court has territorial jurisdiction to entertain the suit.
6. It is argued by ld counsel for the plaintiff U/s 20 CPC, suit can be filed within the jurisdiction of the court where defendant or each of the defendants reside or carry on business or voluntarily work for gain or where the cause of action as wholly or in part has arisen. It is argued that since cheque of loan issued to the defendant was issued by plaintiff from Delhi and secondly the EMIs issued by the defendants have been dishonoured in New Delhi, this court has jurisdiction.
7. From perusasl of loan agreement executed between the parties, I find that it is between HDFC Ghaziabad Branch of the plaintiff through it Sr Manager Sanjay Joshi and defendants. Both the defendants are shown to be residents of Ghaziabad. Agreement was executed between the parties at Ghaziabad. As per receipt of consideration placed on record, the receipt of consideration was executed at Ghaziabad which shows that actual payment of cheque was made at Ghaziabad. Letter of guarantee was also executed at Ghaziabad. The agreement was attested by Notary Public at Ghaziabad. It is, therefore, clear that no part of loan transaction had taken place within jurisdiction of Delhi and same had taken place only at Ghaziabad. EMIs according to the agreement were payable to Ghaziabad Branch of plaintiff bank at Ghaziabad. The agreement between the parties shows that cheque 781283 dated 3 9.11.02 drawn on HDFC Ghaziabad Branch, in favour of M/s Jai Shree Builders Ghaziabad (meant to be deposited in its account with Punjab and Sind Bank,Ghaziabad) at the request of borrower was handed over to defendants at Ghaziabad. Property allegedly purchased by defendant no.1 is situated in Ghaziabad. Therefore, it is, clear that no part of cause of action had taken place in Delhi.
8. Ld counsel for plaintiff has relied upon authority reported as State of Rajasthan and others vs M/s Swaika Properties and another, AIR 1985 SC 1289. In this case, certain properties situated in Jaipur had been acquired by the State Govt of which notice was issued to the owner in West Bengal. The owner of land wanted to challenge the notification of acquisition of his properties situated in Rajasthan by a writ in High Court of Calcutta. It was held that High Court of Calcutta had no jurisdiction to entertain the petition. This authority is, therefore not attracted to the facts of the present case. Second authority relied upon by plaintiff is M. Vittal Rao and Anrs vs M.H.Ranganath and others 1( 2000) CLT 438 Karnataka. In this authority X had taken loan under a pronote undertaking to meet demand for repayment at any time and at any place as the promisee may choose. It was held that the place within the local limits of whose jurisdiction promisee resided or issued notice of demand would have jurisdiction to entertain the suit. In the present case, loan had not been taken on any pronote containing any terms and conditions as mentioned above, therefore, this case also is not of any help to the plaintiff. Ld counsel for plaintiff has further relied upon another authority reported as 4 Vijaya Bank vs Kiran and Co, AIR 1983 Madras, 357. In that case firm X had obtained a draft payable to 'R' at Bombay. The draft was lost and owner of the draft requested bank to stop payment. The payment of the draft was made by the bank to a third person. In a suit filed by X against the bank at Madras, it was held that Madras court will have jurisdiction. Again this authority does not help the plaintiff. He has relied upon another authority reported as Dena Bank Ltd vs Ironside Ltd AIR 1987 Bombay 227. In that case, bill of exchange was drawn by A in Bombay on B who had it is submitted registered office in England, A had discounted the bill with C in plaintiff Bank at Bombay, bill was accepted by B in England but was dishonoured. It was held that cause of action had arisen in Bombay, therefore, Bombay court has jurisdiction to entertain the suit. Again facts of that case are different from the facts of the present case, therefore, this authority is not applicable to present case.
9. Ld counsel for plaintiff has claimed jurisdiction of Delhi court for two reasons. First the cheque of loan amount was given to the defendant was issued by the plaintiff at New Delhi. Secondly, EMIS issued by the defendant have been dishonoured at New Delhi. So far as first ground is concerned, in the agreement itself, it has been specifically stated that a cheque No 781283 dated 9.11.02 was drawn on HDFC Ghaziabad branch of the plaintiff. It was directly issued in the name of M/s Jai Shree Builders, Pasonda, by Ghaziabad Branch of HDFC Bank, therefore, the reason given by plaintiff to invoke jurisdiction of Delhi court is not borne out of the record. Even 5 otherwise this is not part of cause of action as to where the cheque of loan amount represented by the cheque was drawn. In Swasyama Proprties ( Supra), it was held by their lordships that it was not necessary for the respondents to plead service of notice on them by Special Official Town Planning Department, Jaipur in order to invoke the jurisdiction of the High Court, therefore, same was not part of the cause of action. If these observations are applied to the present case where cheque representing loan amount has been prepared is neither necessary to be alleged nor it is part of the cause of action. The part of cause of action is fact as to where the cheque was handed over. As per agreement, the cheque of loan amount was drawn by HDFC Bank, Ghaziabad Branch and was handed over to the defendants at Ghaziabad. Therefore, on this count plaintiff can not invoke jurisdiction of this court.
10. The second ground on which jurisdiction of Delh court has been invoked is that EMIS issued by defendants have been dishonoured at New Delhi. It seems that plaintiff case is that defendants had issued cheques towards payment of EMIS which when presented in Delhi by the plaintiff have been dishonoured. In order to invoke jurisdiction of Delhi court, the plaintiff might have presented the cheque for encashment at Delhi. As per agreement, the EMIS were payable to HDFC,Ghaziabad, and not to HDFC Bank, New Delhi. If at all the EMIs had been paid to HDFC Bank, Ghaziabad, the cause of action only pertains to Ghaziabad Branch of HDFC Bank. The plaintiff can not invoke the jurisdiction of this court by making internal arrangement to gt the cheque from Ghaziabad transferred to itself at New Delhi 6 so that jurisdiction of Delhi court could be invoked. On this count also, jurisdiction of Delhi court can not be invoked. In my considered opinion, no part of cause of action has arisen within jurisdiction of Delhi court. Defendants are residents of Ghaziabad, property purchased is situated in Ghaziabad, agreement between plaintiff and defendants was executed at Ghaziabad, EMIs were payable to HDFC branch, Ghaziabad. Therefore, no part of cause of action has arisen in Delhi. I am, therefore, of the view that Delhi court has no jurisdiction to entertain the suit. Plaint is accordingly returned to the plaintiff for presentation to court having jurisdiction. Original documents be also returned to the plaintiff and photocopies thereof be kept on record. An endorsement be made on the plaint as to date of presentation of the plaint and return thereof. Rest of the file be consigned to record room.
Announced in the open Court
on 01.05.07 (BABU LAL)
ADDL. DISTRICT JDUGE
DELHI
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