1983 (3) TMI 257 - SC - Indian Laws

Whether under Section 19 or Section 20 of the CPC can also be invoked on the ground that the defendant resides or carries on business or personally works for gain within the jurisdiction of the court? Held that - Here it could not be disputed that the appellant does carry on business in the City of Jaipur and if that be so, there can be no doubt that the Court in Jaipur City would have jurisdiction to entertain the suit filed by the respondents against the appellant. In that event, Clause 17 of the Contract of Carriage conferring ex- elusive jurisdiction on the Court in Jaipur City and excluding the jurisdiction of other courts would be valid and effective. Thus the High Court was in error in taking the view that the jurisdiction of the Court of Civil ; Judge, Allahabad was not excluded by Clause 17 of the Contract of Carriage and that Court had jurisdiction to entertain that suit. We accordingly allow the appeal, set aside the judgment of the High Court as also the order passed by the Civil Jude. Allahabad and taking view the Court of the Civil Judge, Allahabad has no jurisdiction to entertain the suit.

Summary

Issues:
Jurisdiction of the Court of Civil Judge, Allahabad in a suit for damages for loss of goods under a Contract of Carriage with an exclusive jurisdiction clause.

Analysis:
The appeal before the Supreme Court was against the High Court of Allahabad's order rejecting the revision application challenging the jurisdiction of the Court of Civil Judge, Allahabad in a suit for damages for goods lost during carriage. The consignment note contained a clause (Clause 17) stating that the Court in Jaipur City alone shall have jurisdiction over claims arising under the consignment or goods entrusted for transportation. The respondents filed the suit in Allahabad, arguing that a part of the cause of action arose there, giving the court jurisdiction. The appellant contended that the exclusive jurisdiction clause in the consignment note should be upheld. The Civil Judge, Allahabad, and the High Court agreed with the respondents, holding that since no part of the cause of action arose in Jaipur, the exclusive jurisdiction clause was ineffective.

The Supreme Court clarified that parties cannot confer jurisdiction on a court that it does not possess. However, if multiple forums are available, parties can select a particular forum and exclude others for claims under a contract. In this case, it was determined that part of the cause of action did arise in Jaipur, where the appellant conducted business. Therefore, the Court in Jaipur City would have jurisdiction to entertain the suit. As a result, the exclusive jurisdiction clause in the consignment note, Clause 17, would be valid and effective.

The Supreme Court held that the High Court erred in finding that the Court of Civil Judge, Allahabad, had jurisdiction despite the exclusive jurisdiction clause. The appeal was allowed, and the judgment of the High Court and the order of the Civil Judge, Allahabad were set aside. The Court directed the return of the plaint to the respondents for presentation to the appropriate court in Jaipur City. The Court also specified that the period during which the respondents pursued their claim in Allahabad would be excluded from the limitation period for filing the suit in Jaipur City. No costs were awarded in this matter.