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TMI Blog2013 (4) TMI 145X X X X Extracts X X X X X X X X Extracts X X X X ..... itation u/s 14 and this Court also lacked territorial jurisdiction to entertain the applications. ICL contended that they would have to file a civil action either before a Paradip Court or Haldia had there been no arbitration clause. None of the eventualities occurred within the territorial jurisdiction of this Court. Held that – Section 14 of the Limitation Act would exclude the period when a litigant would approach a different Court other than the appropriate Court. The Arbitration was held at Delhi. SAIL thought, it would be the appropriate Court. On such bonafide belief, they approached the Delhi High Court who later on held that it did not have territorial jurisdiction to entertain the same. Delhi High Court did not dismiss the petition. It directed return of the petition with a liberty to file it in the proper Court. Hence the time taken by Delhi High Court would certainly stand excluded. Once the Court found that it had no territorial jurisdiction to entertain a lis it must return the same to the litigant at the earliest so that the delay in the process must not prejudice his right to approach a Court of law. That was the basic concept behind Section 14. In the instan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e resolved through arbitration in terms of the arbitration clause stipulated in the Charter Party Agreement. Accordingly, the parties nominated their respective nominees in the Arbitral Tribunal. The Arbitral Tribunal held sittings at Delhi. The Arbitral Tribunal ultimately, published its award on September 6, 1999. SAIL was not happy with the award. SAIL challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996 before the Delhi High Court on December 16, 1999. The Delhi High Court finally heard the application and declined to entertain the same vide judgment and order dated March 15, 2004. The Court found that it had no territorial jurisdiction to entertain the same. The Court directed the application to be returned to SAIL for filing it in the proper Court. SAIL applied for Certified Copy of the order however, did not wait as by that time the petition was ready to be returned. The Court returned it on April 13, 2004. April 14 being holiday at Calcutta SAIL filed it in this Court on April 15, 2004. From the records, we find that the original application filed before the Delhi High Court being O.M.P. 30 of 2000 was re-numbered as A.P. No. 129 of 2004 by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would arise on the Charter Party wherein ICL could have initiated proceedings for recovery of their dues against SAIL in a Court where SAIL was carrying on business. SAIL was having its office at 18, Strand Road, Calcutta dealing with the subject consignment hence, this Court was competent to entertain a civil action and thus, would come within the definition of Section 2(e) to maintain an application under Section 34. He relied on the following decisions in this regard:- i) Nawab Usmanali Khan Vs- Sagar Mal reported in All India Reporter 1965 Supreme Court page 1798. ii) M/s. Dynasty Developers Private Limited Vs- Jumbo World Holdings Limited and Others reported in All India Reporter 2008 Madras page 119. iii) Kellie Vs- Fraser reported in Indian Law Reporter Volume II page 447. On the issue of limitation Mr. Ghosh relied on the following decisions: i) Ram Ujarey Vs- Union of India reported in 1999 Volume I Supreme Court Cases page-685. ii) Union of India and Anr. Vs- Bhavna Engineering Co. reported in 2006 (Suppl.) Arbitration Law Reporter page-47 (Supreme Court). iii) State of Goa Vs- Western Builders reported in 2006 Volume VI Supreme Court Cases page-239. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eported in All India Reporter 1989 Supreme Court page 1239. In this decision the Apex Court observed, in case of a breach of a contract, the proceeding could be filed at a place where it was made. The place of performance was also relevant for the purpose. Resuming his argument on the next day, Mr. Tilak Bose contended, it was the subject matter of arbitration that would determine the cause of action and not each piece of facts that might occur eventually leading to the controversy. He referred to Section 2(e) and tried to distinguish the provisions of Section 20 of the Code of Civil Procedure. He would say, Section 20 of the Code of Civil Procedure would empower one or more courts to entertain a civil action where any part of the cause of action would arise. However, under Section 2(e) of the said Act of 1996, the Court would have jurisdiction to deal with any proceeding initiated under the said Act of 1996 where the said court would have the jurisdiction to decide the question forming the subject matter of arbitration had any civil suit been filed for the same. In short, a court was empowered to determine any dispute that would arise within the limits of its territorial juris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... risdiction of this Court. He referred to the pleadings of the supplementary affidavit wherein we would find SAIL invoking jurisdiction on the plea, parties negotiated for a chartered party at Calcutta and some of the correspondences were exchanged therefrom. Relying on the said averment Mr. Bose contended, that would not confer jurisdiction on this Court as it was not the subject matter forming the controversy. He reiterated, chartered party was executed at Chennai and not at Calcutta as erroneously held by His Lordship. Exchange of correspondence was not the relevant piece of fact that could give rise to the cause of action. He also contended, even if twin plea of exchange of correspondence and negotiation of chartered party both at Calcutta were accepted on its face value that would have no consequence to confer jurisdiction on this court to term it as principal civil court within the meaning of Section 2(e). WHAT IS CAUSE OF ACTION: Resuming his argument of the next day, Mr. Bose contended, SAIL invoked jurisdiction of this Court on three counts : i) SAIL was carrying on business within jurisdiction. ii) Negotiation for Charter Party was held at Calcutta. iii) Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... age-1239. He relied on the A.B.C Laminarts (supra) and as well as the Delhi High Court judgment in the case of Engineering Projects (Supra) to support his contention that the Court having substantial part of the cause of action having arisen within, should be the competent Court within the meaning of Section 2(e). Merely because one of the parties was carrying on business would not confer jurisdiction as held by the Jharkhand High Court in the case of Pratap Electrical (Supra). He referred to the judgment and order impugned particularly page 210 and 211 to say, learned Judge mis-read the pleadings. His Lordship s view that carrying on business by SAIL would attract territorial jurisdiction, was erroneous. LEAVE UNDER CLAUSE 12 OF THE LETTERS PATENT IS IT NECESSARY?:- Mr. Bose relied on two decisions of this Court in the case of Magma Fincorp Ltd. Vs- AHK Earth Movers Financial Services Ors. reported in All India Reporter 2011 01Calcutta page 152 and in the case of Tobu Enterprises Pvt. Ltd. Vs. Camco Industries Ltd. reported in All India Reporter 1984 Calcutta page-24. Citing two Calcutta decisions Mr. Bose contended that leave under Clause 12 of the Letters Patent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the question whether the said Court was the Court within the meaning of Section 2(c) of the said Act 1940 pari materia with Section 2(e) of the said Act of 1996. Hence, an application for setting aside of the award under old law could only be filed before the Court where award was filed whereas the said application under the new law would have to be filed before the Court within the meaning of Section 2(e) being a Court which would otherwise determine questions forming the subject matter of controversy in case any civil action was brought for the said purpose. Hence according to Mr. Bose, the decision in case of Dynasty Developers (Supra) would be of no assistance to SAIL. SECTION 14 OF THE LIMITATION ACT: Mr. Bose contended that on a plain reading of the said provision it would clearly appear that the provision would apply only to suit and no other proceeding. If SAIL would take benefit of this provision then they would have to accept proceeding under Section 34 as a suit. Moment they would do so they would be obliged to take leave under Clause 12 of the Letters Patent. DELAY: Mr. Bose referred to Section 34(3) to contend that the application must be filed with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ply in the instant case that would be clear meaning of Section 2(1)(e). He contended, Section 2 (1)(e) would include High Court. Hence the legal right of SAIL that arose at Calcutta to receive lay time charges since been denied, would definitely attract the jurisdiction of this Court. He distinguished the decision in the case of A.B.C Laminart (Supra) and Southeast Asia Shipping Company Limited (Supra) would relate to cause of action being attracted on account of breach. He contended, the present case would stand on a different matrix. There was delay in unloading, which would automatically attract lay time charges. The dispute would relate to calculation of lay time charges that was done at Calcutta by SAIL. Such claim of SAIL was payable at Calcutta. Hence these two decisions would be of no assistance to us. He distinguished three decisions in the case of Rattan Singh (Supra), Capital Fire Engineers (Supra) and Engineering Projects India Limited (Supra) by contending that the combined reading of the said three decisions would relate to the proposition of law that substantial part of cause of action arising within the jurisdiction of the Court that was attracted, must be plead ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In view of the said noting, we are of the view, Mr. Ghosh was correct to say that there was no delay in filing the petition to this Court. In the case of State of Maharastra and Ors. Vs- ARK Builders Private Limited (Supra) the Apex Court held, the date of the receipt of the award was the start date for the purpose of computation of limitation under Section 34. On Section 14 of the Limitation Act, Mr. Ghosh cited four decisions. In the case of Union of India and Anr. Vs Bhavna Engineering Company (Supra), the Apex Court condoned the delay when an application under Section 34 was mistakenly filed before the Madhya Pradesh High Court instead of Bombay High Court. The Apex Court relied on Section 14 and made it applicable in the said case. The Apex Court overruled the decision of the High Court that Section 14 of the Limitation Act would not apply in case of the arbitration proceeding. In the case of State of Goa Vs Western Builders (Supra), Section 14 was once again made applicable. In a case of the like nature the Apex Court in paragraph 26 held, Section 14 of the Limitation Act would be applicable in the Arbitration and Conciliation Act, 1996. The Apex Court took similar vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld be the cause that would make the parties joining issue with each other on a dispute inter se. Each and every piece of fact that might have some connection with the dispute, would not be relevant to determine the genesis of Cause of Action helping to attract jurisdiction of a particular Court. Clause 12: Mr. Bose relied upon Magma Fincorp (Supra) and Tobu Enterprises (Supra) both of our Court, to contend that an application for under Section 34 would have all trappings of suit. He also relied upon Bepin Behary Law (Supra). The ratio decided therein would relate to well-settled proposition of law. Clause 12 of the Letters Patent would vest original jurisdiction to this Court to try and determine a suit that might include similar proceedings. It is a special power granted to the Chartered High Court by the said Charter that would empower this Court to entertain any suit that would arise within the jurisdiction of this Court wholly or in part. However, Section 20 of the Court of Civil Procedure would automatically empower a Court having part of the Cause of Action arising therein to entertain a suit. The High Court is given free hand either to receive or to decline even if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of the Order. It is not the case of either side that Court was ready to return the petition on the same day. It was physically not possible as passing of the order would have various consequences that would consume some time including signing of the Order, having the same recorded in the department s file, providing certified copy to the parties, making the petition ready for return by keeping loco copy thereof. Such time taken by the department of the Delhi High Court for administrative reason must be excluded while computing the period. The petition was ready for delivery on April 13, 2004 that was not in dispute. April 14 was holiday in Calcutta. On April 15, it was filed in this Court. Hence the petition was well within the period of limitation. Question of applying for condonation of delay would not arise at all. We thus hold this issue in favour of SAIL and reject the contention raised by Mr. Bose on behalf of ICL. JURISDICTION: The plea of jurisdiction is a mixed question of fact and law. The Section 2(e) as we find on a plain reading, would relate to question arising out of the dispute forming Cause of Action, attracting jurisdiction of a Court that would be a Pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l miles after miles to reach the door of Justice he would be reluctant to approach. It would be difficult for him to approach Court of law that would give rise to inordinate discontent amongst the citizens who, despite grievance being had, would not be in a position to approach the door of Justice for redressal. Hence the Court in the near proximity of both the litigants having appropriate pecuniary and territorial power and having appropriate competence would be appropriate for redressal of grievance. Problem would arise, where all the parties would not be of the same locality, one might be at a distance. In such case the Court which would be less inconvenient to the party against whom the complaint would be made, would be the right choice. Coming back to the factual matrix, if we apply our thought as above, we would find that a civil action either by SAIL or by ICL on the identical controversy, should be filed at Paradip or Haldia, that would help both the parties to adduce appropriate evidence, documentary and/or oral, as it would be the local Court where the incident occurred, the incident that gave rise to the dispute, meaning thereby, the cause of delay and factual delay. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arise at all. Hence we leave it open to be decided in an appropriate controversy, if occasions so arises in future. The jurisdiction of the Calcutta High Court could be attracted in the present case on the strength of the raising of demand on lay time calculation. Even if we accept, this Court had jurisdiction on the strength of raising of demand and corresponding denial having arisen at Calcutta, we would find significant part having arisen admittedly outside jurisdiction of this Court. We cannot brush aside the argument of Mr. Ghosh that calculation of lay time charges and submission of the same from Calcutta coupled with a denial received at Calcutta would raise the subject matter of controversy. However, that issue would become insignificant as we would have to find out the genesis of controversy that would lie at Paradip and Haldia as elaborately discussed herein before. Hence even if we hold that the Calcutta High Court had jurisdiction we should not entertain the application under Section 34, whether or not leave under Clause 12 was required to be obtained. Considering balance of convenience and inconvenience and the real issue involved in the litigation giving rise t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Delhi High Court in deciding the issue would stand excluded from being counted in the instant case. If we exclude the said period we would find the petition well within the prescribed period of limitation. Hence the learned Judge was perhaps not correct on the issue. On that score we join issue with His Lordship. We thus hold, it is a fit and proper case, SAIL should approach Principal Civil Court having territorial jurisdiction over Paradip Port or Haldia Port. We thus direct return of the petition to SAIL for being filed at the appropriate Court as referred to above. We direct the Registrar Original Side to cause return of the petition to SAIL keeping a loco copy thereof. We abundantly make it clear that the period taken by us in deciding the issue both by the learned Single Judge as well as by us and the period the Registrar might take in actual return, would stand excluded under Section 14 of the Limitation Act. The appeals succeed in part and are allowed to the extent as above. The judgment and the order of the learned Single Judge impugned, would stand modified accordingly. There would be no order as to costs. Urgent certified copy of this judgment, if a ..... 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