Taurus Englobe Pvt. Ltd. v. Bhavin R Shah

1. Present appeal has been filed challenging the order dated 9th September, 2022 passed by the Learned District Judge, Commercial Court 01, Tis Hazari Court, Delhi in CS (COMM) No. 608437-2016, whereby the court directed the Appellant herein to pay an amount of Rs.9,39,210/- to the Respondent-Plaintiff along with interest at 6% from 1st July, 2016 till the date of realization.

2. Learned counsel for the Appellant states that the Trial Court failed to appreciate that no cause of action arose within the jurisdiction of Delhi as the Appellant carries on its business and works for gain from Noida and its manufacturing unit is also situated in Noida at a SEZ facility. He states that the goods were ordered from Noida and had been delivered at Noida. He further states that the Respondent-Plaintiff had raised the invoices at the Appellant’s address in Noida. He points out that the I-Form issued by the Appellant to the Respondent-Plaintiff to claim exemption from payment of Sales Tax was issued from Noida.

3. In support of his submission, he relies on the decision of the Supreme Court in Patel Roadways Ltd. Vs Prasad Trading Co., (1991) 4 SCC 270, wherein it has been held as under:- "9……..The words “at such place" occurring at the end of the Explanation and the word "or" referred to above which is disjunctive clearly suggest that if the case falls within the latter part of the Explanation it is not the court within whose jurisdiction the principal office of the defendant is situate but the court within whose jurisdiction it has a subordinate office which alone shall have jurisdiction "in respect of any cause of action arising at any place where it has also a subordinate office".

4. Learned counsel for the Appellant emphasises that just because the Appellant has a registered office in Delhi, it would not mean that the Courts in Delhi would have jurisdiction to decide the matter. He states that it is the Court where the cause of action has substantially or predominantly occurred, which will have the jurisdiction to try and decide the matter. In support of his submission he relies upon the judgment of a learned Single Judge of this Court in Degremont Ltd. vs. Kolkatta Municipal Corporation, 2013 SCC Online Del, 2852.

5. He further states that the Trial Court has not adjudicated upon the second issue i.e. the goods supplied by the Respondent-Plaintiff to the Appellant were defective. He states that the appellant has suffered damages running into crores of rupees on account of defective supply by the Respondent-Plaintiff.

6. He also states that entire blame lies with the Respondent-Plaintiff as it had not taken back the defective material despite repeated requests. In support of his contention, he relies upon the email dated 23rd May, 2013 written by the Appellant to the Respondent-Plaintiff, which reads as under:- “.....Please do accept the debit note which were given to you when you were here in Delhi in our Account statement and then send us the revised account statement so that the account can be matched. Also please tell us about the rejected material lying on our company, when you are lifting this material.”

7. With the assistance of learned counsel for the Appellant, we have perused the Trial Court record. We find that the Trial Court has decided the issue of jurisdiction in favour of the Respondent-Plaintiff on the ground that the Appellant in his own email dated 29th December, 2012 had admitted that certain negotiations had taken place in Delhi. The relevant portion of the said email written by the Director of the Appellant is reproduced hereinbelow:- “...The following quantities are required very urgently. The first priority is very URGENT and we need these material within 3-4 days and the second priority are also very URGENT. And these items we need for new design which we have discussed with Bhavin Bhai when he was in Delhi last time.”

8. In South East Asia Shipping Co. Ltd. vs. Nav Bharat Enterprises (P) Ltd., (1996) 3 SCC 443, the Supreme Court has held that “cause of action consists of bundle of facts, which give cause to enforce the legal injury for redress in a court of law. The cause of action means, therefore, every fact, which if traversed, it would be necessary for the plaintiff to prove in order to support his right to a judgment of the court. In other words, it is bundle of acts, which taken with the law applicable to them, gives the plaintiff a right to claim relief against the defendant. It must include some act done by the defendant since in the absence of such an act no cause of action would possible accrue or would arise”. Consequently, a part of the cause of action had arisen within the jurisdiction of this Court.

9. This Court also finds that no evidence has been led by the Appellant to prove that negotiation that had taken place in Delhi was trivial in nature and did not constitute a substantial or predominant part of the cause of action.

10. Moreover, the email dated 23rd May, 2013, relied upon by learned counsel for the Appellant, confirms that part of the cause of action had arisen within the jurisdiction of this Court as the alleged debit note had admittedly been handed over to the Respondent-Plaintiff in Delhi itself.

11. Consequently, this Court is of the view that as a part of the cause of action has arisen in Delhi i.e. within the territorial jurisdiction of the Trial Court and the Appellant/Defendant also had a registered office in Delhi, the Trial Court was justified in entertaining and deciding the suit filed by the Respondent-Plaintiff.

12. As far as the argument that the Trial Court has not adjudicated that the goods/materials supplied by the Respondent-Plaintiff were defective is concerned, this Court finds that the Appellant-Defendant has not filed any counter claim.

13. During the course of hearing of the present appeal, no evidence was brought to our notice to show that the goods supplied by the Respondent- Plaintiff were defective.

14. In fact, the Trial Court has decreed the suit against the Appellant- Defendant only with regard to the goods/material which had not been returned by the Appellant either due to theft of articles at its premises or due to export of material by the Appellant or due to the fact that the goods/material which had been allegedly returned had not been valued by the Appellant itself.

15. Consequently, this Court finds that the arguments advanced by learned counsel for the Appellant are contrary to the record and untenable in law. Accordingly, the present appeal along with pending application being bereft of merit is dismissed. No order as to costs. MANMOHAN, J SAURABH BANERJEE, J NOVEMBER 28, 2022