Andhra HC (Pre-Telangana)
Sponge Iron India Ltd. vs Andhra Steel Corporation Ltd. on 16 June, 1988
Equivalent citations: AIR1989AP206, AIR 1989 ANDHRA PRADESH 206, (1988) 2 ANDH LT 439, (1988) 2 LS 171, (1988) 2 APLJ 493, (1989) 1 CURCC 66, (1989) 1 CIVLJ 171
Author: Syed Shah Mohd. Quadri
Bench: Syed Shah Mohd. Quadri
JUDGMENT Amareswari, J.
1. A short but interesting question arises in this appeal. The plaintiff M/s. Sponge Iron India Ltd., are manufacturers of Sponge Iron with their Office in S.I.I.L. Campus, Khammam District within the jurisdiction of the Subordinate Judge's Court at Kothagudem. The defendant M/s. Andhra Steel Corporation Ltd., is a firm based at Bangalore engaged in the manufacture of steel billets for which the raw material is sponge iron. The defendant placed a purchase order dated 21-12-1981 requiring the plaintiff to supply 15,000 metric tonnes of sponge iron at Rs. 1425/- per metric tonne. These conditions are mentioned on the first page of the purchase order. On the reverse, there were other terms and conditions out of which Condition No. 11 says that the purchase order "shall be subject to the jurisdiction of the Bangalore Courts". The plaintiff in his turn sent a sale order dated 26-12-81 agreeing to supply 15,000 metric tonnes of sponge iron at Rs. 1425/-per tonne, subject to general terms and conditions specified overleaf. On the overleaf, one of the conditions mentioned at Item No. 11 is that "all orders accepted by S.I.I.L are subject to Andhra Pradesh State Jurisdiction only". The plaintiff started supplying the goods from 29-12-1981. On 3-3-1982 the plaintiff sent the duplicate of the purchase order duly signed by him to the defendant. Subsequently, disputes arose between the parties and the plaintiff filed a suit O. S. No. 171 of 1982 in the Court of the Subordinate Judge at Kothagudem for recovery of the amount alleged to be due for the goods supplied with interest etc.
2. The defendant filed a written statement taking several pleas that the goods supplied were not of standard quality and there were shortages from time to time and that the interest claimed is excessive. They also took plea that the Court at Kothagudem has no jurisdiction to try the suit as the parties have agreed that all disputes regarding the transaction should be settled in Bangalore Courts only.
3. On these pleadings, the learned Subordinate Judge, Kothagudem framed issues, one of which is whether the Court at Kothagudem has not jurisdiction. He decided the said issue first. The learned Judge referred to Section 20 of the Civil Procedure Code and held that though the Courts at Bangalore and the Court at Kothagudem have got jurisdiction, since the parties have agreed to limit the jurisdiction to the Courts at Bangalore, the Kothagudem Court has no jurisdiction to try the suit. The learned Judge dismissed the suit without giving any findings on other issues.
4. In this appeal, the submissions of the learned Counsel for the appellant are twofold.
(1) The condition in the purchase order does not have the effect of ousting the jurisdiction of the Courts in Andhra Pradesh and, (2) There was no consensus or agreement on the conditions put forth by the defendant that all disputes should be settled only in Courts at Bangalore.
5. To appreciate the respective contentions of the parties, it is necessary to refer to Section 20 of Civil Procedure Code which reads as follows :--
"Other suits to be instituted where defendants reside or cause of action arises:--
20. Subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction-
(a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain; or
(b) any of the defendants, where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either the leave of the Court is given, or the defendants who do not reside, or carry on business, or personalty work for gain, as aforesaid, acquiesce in such institution; or
(c) the cause of action, wholly or in part, arises."
6. It is seen from the above provision that a suit can be filed in a Court in whose jurisdiction the defendant resides or carries on business and a suit can also be filed in a Court in whose jurisdiction the cause of action as a whole or in part arises. The Section gives a right to the plaintiff to choose the forum and file a suit in whose jurisdiction the defendant resides or where the whole cause of action or a part of cause of action arises. Therefore, the plaintiff in this case has a right to file a suit in Kothagudem Court as part of cause of action arose at S.I.I.L. campus which is within the territorial jurisdiction of Kothagudem Court or the plaintiff may also file a suit at Bangalore where the defendant was carrying on business. The plaintiff has a choice in the matter.
7. Now the only question to be considered is whether any condition of the contract between the plaintiff and defendant limited the jurisdiction of the Court at Bangalore and whether there was an agreement between the parties on that condition.
8. On the reverse of Ex. A-1 the purchase order, some terms and conditions are printed. Condition No. 11 is as follows :--
"This order in all respects shall be subject to the jurisdiction of the Bangalore Courts."
This is the condition relied upon by the defendant to say that the jurisdiction of the Courts in Andhra Pradesh in ousted. This condition does not in our opinion, oust the jurisdiction of any other Court than Bangalore. Admittedly a pan of the cause of action arose in Khammam District of Andhra Pradesh and a part of the cause of action arose at Bangalore where the defendant resides. The goods are supplied from Khammam District in Andhra Pradesh. Therefore, as per Section 20, C.P.C. the Courts in Andhra Pradesh and also the Courts at Bangalore have got jurisdiction. This condition in Ex.A-1 in the absence of the words "only" or "alone" does not have the effect of ousting any other Court of its jurisdiction which it otherwise had In matters like this, which relates to the ouster of the jurisdiction, the language must be clear and specific. It is one thing to say 'subject to the jurisdiction of the Bangalore Courts' and it is entirely another thing to say that 'subject to the jurisdiction of the Bangalore Courts only". In the former, the ouster of jurisdiction of any other Court cannot be implied, whereas in the latter, the intention is clear that the choice is limited to one Court.
9. In this connection, the learned Counsel relied upon a decision of this Court in T. Anjanyuluv. Rama Krishna Textiles, (1976) 2 APLJ (HC) 358, wherein the words in the Bill "subject to Bombay jurisdiction" were construed to mean that the Bombay Court has got exclusive jurisdiction. With great respect to the learned Judge, we are unable to agree. Unless the language is unambiguous, clear and specific ouster of jurisdiction cannot be inferred.
10. In M/s. Patel Bros. v. M/s. Vadilal, similar words viz., "subject to Bombay jurisdiction" it was held that it does not amount to ouster of jurisdiction of other Courts and that it cannot be a matter of assumption or presumption but one to be proved by express words contained in the contract or at least by necessary or inevitable implication.
11. In M/s. Surajmali v. Kalinga Iron Works, , the Orissa High Court ruled that ouster of Court's jurisdiction should not be easily construed and could not be assumed or presumed very easily and that ouster must be proved by express words or by necessary implication. The Orissa High Court relied upon the decision of the Madras High Court in M/s. Patel Bros v. M/s. Vadilal .
12. In G. P. Venkataraju v. Palukuri, the words "subject to Calcutta jurisdiction" in the Bill were construed not to exclude the jurisdiction of the Courts at Rajahmundry where the cause of action had arisen.The learned Judge approved of the view taken by the Madras High Court in M/s. Patel Bros v. M/s. Vadilal, .
13. In the present case, Ex.A-1 purchase order merely mentions that the order is subject to the jurisdiction of Bangalore Courts. This is nothing but the effect of Section 20, C.P.C. There are no express words ousting the jurisdiction of the Courts in Andhra Pradesh. The language of the condition does not oust the jurisdiction even impliedly.
14. The next question to be considered is whether there is any agreement or consensus on this aspect Ex.A-1 is only a purchase order that emanated from the defendant It contains some terms and conditions on the front page regarding the quantity and the rate and the mode of despatch and the place to which the goods are to be despatched. It also contains a request to supply the goods subject to the terms and conditions printed on the reverse. The reverse page contains certain terms and conditions and Condition No. 11 says that the order in all respects is subject to the jurisdiction of the Bangalore Court. This is the order placed by the defendant. The plaintiff in his turn sent a sale order in respect of the same goods requested to be supplied by the defendant dated 26-12-1981. Now the sale order refers to the quantity and the rate specified by the defendant It also contains terms and conditions and Condition No. 6 mentions that the "sale is subject to general terms and conditions specified overleaf. The general terms and conditions are printed on the overleaf and Condition No. 11 says that "all orders are subject to Andhra Pradesh jurisdiction only". On a reading of the purchase order Ex.A-1 and the sale order Ex.A-2, it is clear that there is no consensus or agreement on the question of jurisdiction of Courts. While the purchase order mentions "subject to the jurisdiction of Bangalore Courts', the sale order mentions "subject to the Andhra Pradesh State jurisdiction only". The acceptance by the plaintiff as indicated in Ex. A-2 the sale order clearly indicated his intention that any dispute should be settled by the Andhra Pradesh Courts only as against the intention expressed by the defendant in his purchase order that it is subject to the jurisdiction at Bangalore. Thus, there is no agreement or consensus on this point. While the defendant's condition was to limit the choice to Courts at Bangalore, the plaintiff's condition was to limit it to the Courts in Andhra Pradesh. It is therefore, not possible to spell out a contract or a consensus or an agreement between the parties on the question of jurisdiction.
15. The learned Counsel for the defendant-respondent strenuously contended that the conduct of the plaintiff in supplying the goods immediately after the purchase order would amount to acceptance by him of all the conditions mentioned in Ex.A-1 the purchase order. From the record it is seen that the goods were supplied from 29-12-1981. The sale order is dated 26-12-1981, though, it was despatched only on 6-2-1982. The mere supply of goods cannot amount to an acceptance of all the conditions as admittedly the plaintiff indicated in his sale order a different intention. By the time, the sale order was despatched i.e., 6-2-1982 there were no disputes between the parties and if really he had agreed to all the conditions the plaintiff would not have indicated in the sale order about the jurisdiction of the Andhra Pradesh Courts. Further, the supply of goods started from 29-12-1981 whereas the sale order was dated 26-12-1981. The condition on the reverse of the purchase order mentioning that the order is subject to jurisdiction at Bangalore Court is a unilateral condition and merely because the plaintiff started supplying the goods, it cannot be construed that there was an acceptance by the plaintiff of all the conditions specified in the purchase order. No agreement can be culled out from these two documents.
16. The learned Counsel also relied upon Ex.B-2(a) a duplicate copy of the purchase order sent to the defendant by the plaintiff after signing it. It is stressed that since the plaintiff had sent the duplicate copy of the purchase order duly signed, it amounts to his acceptance of the purchase order particularly in view of the fact that the purchase order contained a clause that the plaintiff should return the duplicate duly signed as a token of his acceptance. It is true that the purchase order indicated that the supplyer should return the duplicate signed by him as a token of acceptance. But the duplicate does not contain the conditions printed on the reverse of the purchase order. The clause relating to jurisdiction appears on the reverse of the purchase order. The duplicate copy does not contain any such clause. On the other hand, the duplicate Ex.B-2(a) which is enclosed to the purchase order is not exactly a duplicate since it does not contain all the conditions mentioned in the purchase order. The plaintiff is no doubt bund by Ex.B-2(a) since he had signed the same. But Ex.B-2(a) does not contain the condition relating to jurisdiction. It is therefore, not possible to say that the plaintiff has accepted all the conditions mentioned in the purchase order. From Exs. A-1, A-2, B-2(a) we are unable to hold that there was an agreement between the parties with regard to the jurisdiction of the Courts and that by such agreement they have limited the jurisdiction of the Courts at Bangalore by ousting the jurisdiction of the Court at Kothagundem where a part of the cause of action had arisen. It is not the case of the parties that there was any other contract by negotiation prior to the purchase order- All that can be said is that there is a request by the defendant to supply the goods subject to some terms and condtions, one of which was that if any dispute arises, it should be settled by the Bangalore Courts. The plaintiff agreed to supply the goods as requested by the defendant. But lie imposed his own condition namely, that the Courts in Andhra Pradesh alone had jurisdiction. Thus there is no consensus or meeting of the mind, agreement or contract on this question. Ex.B-2(a) is the only contract between the parties where the plaintiff had agreed to the request by the defendant for the supply of goods and Ex.B-2(a) does not contain a condition relating to the jurisdiction of the Court What all is accepted by the plaintiff are the conditions' mentioned in Ex.B-2(a). Thus on a consideration of the relevant material, we are of the view that both Courts at Bangalore and also at Kothagudem Court have got jurisdiction and the plaintiff by agreement have not limited the choice to the Courts at Bangalore only.
17. For the above reasons, we set aside the order of the Court below and remand the suit for fresh disposal after giving findings on all issues; after giving an opportunity to both sides. The Civil Miscellaneous Appeal is accordingly allowed. No costs.