Gautam Budha University v. M/S Efficient Book Distributors

1. This is an appeal against the impugned judgment/order dated 24th August, 2016 by which the delay in filing of memo of appearance by the Appellant/Defendant – Gautam Budha University (hereinafter, „Defendant University‟) was not condoned leading to the suit of the Respondent/Plaintiff (hereinafter, „Plaintiff‟), filed under Order 37 CPC, being decreed in the following terms:

2. The brief background is that the Defendant is the Gautam Budha University which has filed the present appeal. The Plaintiff - M/s Efficient 2018:DHC:3653 Book Distributors claims that it made continuous supply of several books to the University for which payments were not made. Accordingly, the suit came to be filed, under Order 37 CPC, with a prayer for recovery of amount of Rs.36,93,531/- along with the future and pendente lite interest. Along with the suit, the Plaintiff placed on record the various purchase orders and invoices and also the ledger account.

3. Summons under Order XXXVII CPC was issued on 12th February, 2014 by the Joint Registrar of this Court as the suit was filed on the Original Side of the Delhi High Court. The Defendant University was served with the summons on 26th March, 2014, however, they did not enter appearance and the matter was placed before the Court on 21st August, 2014. By the time, the matter was listed before the Court, the University filed an application seeking condonation of delay in filing the memo of appearance under Section 5 of the Limitation Act. In the said application, two paragraphs are relevant and are set out herein below:

4. Before this Court, counsel for the Defendant University has contended that the suit involves a huge liability to the Defendant University and the delay of 48 days was due to the circumstances mentioned in the application. The University heavily relied upon the report of the Lokayukta dated 9th July, 2013 in which various irregularities in the procurement of books by the library of the University was pointed out. He has taken the court through paragraph 8a, 13(iv), 14, 21(iv) and 22(iii) of the Report to submit that the allegations against the staff of the library and the librarian and other officials are very serious and it appeared that several outdated and unwanted books were being procured in collusion with the officials of the University. He further submits that as per the bid empanelment, the jurisdiction of the Trial Court is under serious challenge. Clause 29 of the said document is relied upon by the University.

5. On the other hand, counsel for the Plaintiff submits that Clause 29 has no application as it was not a part of the bid form which was filled by the Plaintiff.

6. This Court has perused the Clause relating to jurisdiction. There is no doubt that the Plaintiff’s Head Office is at Delhi and supplies have been made from the Delhi. Even as per the clause which is contended as being applicable in the present case, it does not confer exclusive jurisdiction to the courts at Gautam Budh Nagar. Unless and until the words `only’ and `exclusive’ are contained in the jurisdiction Clause, a court otherwise having jurisdiction, cannot be ousted, unless from the conduct of parties, such an inference can be drawn. This is clear from the judgment of the Supreme Court in A.B.C. Laminart Pvt. Ltd. vs. A.P. Agencies (1989) 2 SCC 163s which held as under:

7. The above judgement of the Supreme Court has been subsequently followed in Swastik Gases Pvt. Ltd. v. Indian Oil Corporation Ltd. (2013) 9 SCC 32 where again the Court observed:

32. For answer to the above question, we have to see the effect of the jurisdiction clause in the agreement which provides that the agreement shall be subject to jurisdiction of the courts at Kolkata. It is a fact that whilst providing for jurisdiction clause in the agreement the words like “alone”, “only”, “exclusive” or “exclusive jurisdiction” have not been used but this, in our view, is not decisive and does not make any material difference. The intention of the parties – by having Clause 18 in the agreement – is clear that unambiguous that the courts at Kolkata shall have jurisdiction which means that the courts at Kolkata alone shall have jurisdiction. It is so because for construction of jurisdiction clause, like Clause 18 in the agreement, the maxim expressio unius est exclusio alterius comes into play as there is nothing to indicate to the contrary. This legal maxim means that expression of one is the exclusion of another. By making a provision that the agreement is subject to the jurisdiction of the courts at Kolkata, the parties have impliedly excluded the jurisdiction of other courts. Where the contract specifies the jurisdiction of the courts at a particular place and such courts have jurisdiction to deal with the matter, we think that an inference may be drawn that parties intended to exclude all other courts. A clause like this is not hit by Section 23 of the Contract Act at all. Such clause is neither forbidden by law nor it is against the public policy. It does not offend Section 28 of the Contract Act in any manner.”

8. Thus, there can be an inference of ouster, depending on the facts of each case. However, in the present case, the tender document/bid form relied upon by the Appellant is different than the one for which the Respondent had submitted its offer. The absence of the clause as referred to by the Appellant in the Empanelment letter dated 26th July, 2011, which is the subject matter of the present suit, shows that there was no intention to vest jurisdiction in the courts at Noida. The jurisdiction of courts in Delhi exists as the Plaintiff carries on its business in Delhi and the supplies have been made from here.

9. Insofar as the condonation of delay in filing the memo of appearance is concerned, the Court has perused the application filed by the Plaintiff from the Trial Court Record. It cannot be said that there is no merit in the same inasmuch as there is a possibility, considering the Lokayukta’s report that there has been collusion as alleged by the staff of the University, who may have received the summons from the Court.