2005 (3) TMI 801 - HC - Indian Laws

Summary

Issues Involved:
1. Territorial jurisdiction of the Delhi High Court to entertain the petition.
2. Cause of action and its components.
3. Forum convenience and its applicability.

Detailed Analysis:

1. Territorial Jurisdiction of the Delhi High Court:

The primary issue addressed is whether the Delhi High Court has territorial jurisdiction to entertain the petition filed by ABL. The respondent, NEIGRIHMS, raised a preliminary objection asserting that the Delhi High Court lacks this jurisdiction. The court examined the facts presented by both parties. ABL contended that the agreement dated 17.5.2000 and the supplementary agreement dated 31.12.2003 were executed at the registered office of HSCCI in New Delhi. Additionally, the letter of award was received in New Delhi, and payments under the contract were to be made to banks located in New Delhi. NEIGRIHMS argued that the agreements were executed at the corporate office of HSCCI in Noida, U.P., and that the works were to be performed in Shillong. The court concluded that there was sufficient prima facie evidence to suggest that part of the cause of action arose in Delhi, thus granting the Delhi High Court jurisdiction to entertain the petition, subject to final adjudication after evidence is led.

2. Cause of Action and Its Components:

The court analyzed the concept of cause of action, referring to Section 20(c) of the Code of Civil Procedure and Article 226(2) of the Constitution of India. It was noted that the cause of action includes every fact necessary for the plaintiff to prove to support their right to judgment. The court cited the Supreme Court's interpretations in Laminart Pvt. Ltd. Vs. A.P. Agencies and South East Asia Shipping Company Ltd. Vs. Nav Bharat Enterprises Pvt. Ltd., emphasizing that even a small fraction of the cause of action arising within the jurisdiction of a court is sufficient to confer jurisdiction. The court identified four key facts constituting the cause of action for ABL: the execution of the main and supplementary agreements in New Delhi, the nomination of banks in Delhi for receiving payments, the receipt of the letter of award in Delhi, and the execution and invocation of bank guarantees in Delhi.

3. Forum Convenience and Its Applicability:

The court discussed the doctrine of forum convenience, which allows a court to refuse to exercise its jurisdiction if another forum is more appropriate for the case. However, the court noted that in this particular case, the registered office of HSCCI, a key party involved in the correspondence and bank guarantees, is located in New Delhi. Additionally, some letters invoking the bank guarantees were issued by HSCCI. Given these factors, the court found that it was appropriate to exercise its jurisdiction in this matter.

Conclusion:

The court rejected the preliminary objection raised by NEIGRIHMS, holding that the petition is maintainable in the Delhi High Court. The decision was based on the assertion that part of the cause of action arose in Delhi, and the court's jurisdiction was thus established. The final adjudication on the issue will be subject to evidence being led on the execution of the agreements.