Rajiv Sahai Endlaw, J.:— Issue No. 3, of the issues framed on 13th February, 2009 and ordered to be treated as a preliminary issue, as to the territorial jurisdiction of this court to entertain the suit, is for consideration.
2. The plaintiff has instituted this suit for declaration and permanent injunction vis-vis a bank guarantee, issued at the instance of the plaintiff by the defendant No. 1 bank in favour of the Government of Assam (Defendant No. 2).
3. The defendant No. 2 Government of Assam had on 7th April, 2007 invited bids for supply of equipment installation, commissioning etc. all at Assam. The plaintiff company, stated to be having its registered office at Delhi was one of the bidders. The bank guarantee with respect whereto the suit has been instituted is a bank guarantee for EMD (bid security) issued by the defendant No. 1 bank having its branch at New Delhi and for the benefit of the Defendant No. 2 Government of Assam. The defendants No. 1 bank under the said guarantee bound itself to pay to the defendant No. 2 the sum of Rs. 6 lacs in the event of the plaintiff withdrawing its bid during the period of bid validity and/or if the plaintiff after having been notified of the acceptance of its bid by the defendant No. 2 during the period of the bid validity fails or refuses to execute contract form or fails or refuses to furnish the performance security in accordance with the clauses of tender. The defendant No. 2 invoked the said bank guarantee; according to the plaintiff wrongfully. The plaintiff instituted the suit for the relief of declaration that the plaintiff is not at fault in executing/signing the proposed agreement/contract as sent by the defendant No. 2 and as a consequence to the said declaration seeks permanent injunction restraining the defendant No. 1 from honouring and/or encashing and/or remitting Rs. 6 lacs covered by the said bank guarantee.
4. The plaintiff has in the plaint pleaded that this court has territorial jurisdiction since the cause of action had accrued at Delhi; the defendant No. 1 had received the invocation letter at Delhi and since the defendant No. 1 had forwarded intimation thereof to the plaintiff at Delhi; territorial jurisdiction of this court was also justified since the defendant No. 1 bank works and carries on business at Delhi and the defendant No. 2 Government of Assam also has its office at Delhi through its Resident Commissioner at Delhi.
5. The suit was instituted on 29th March, 2008. The suit was accompanied with an application for interim relief. The suit and the application came up before this court first on 1st April, 2008 when summons/notice thereof was issued to the defendant No. 2, the counsel for the defendant No. 1 having appeared before this court. The suit thereafter came up before this court on 8th April, 2008 when it was inter-alia ordered “all actions of the defendant shall be subject to order of this court”. The defendant No. 1 failed to file the written statement and vide order dated 31st October, 2008 the right of the defendant No. 1 bank to file the written statement was closed. The counsel for the defendant No. 2 informed on that date that the bank guarantee had already been encashed and the monies thereunder received by the defendant No. 2. Even though relief claimed in the suit was for declaration and injunction only but notwithstanding the encashment of the bank guarantee, the suit was held to have not become infructuous for the reason of the order dated 8th April, 2008 making the action of the defendants subject to the orders of the court.
6. The defendant No. 2 in its written statement has contested the territorial jurisdiction of this court leading to an issue with respect thereto being framed. Since on the basis of the averments and the documents, it was felt that the said issue of territorial jurisdiction of this court did not require any evidence, the same was ordered to be treated as a preliminary issue.
7. The counsel for the parties have been heard.
8. The counsel for the plaintiff has contended that since the bank guarantee was furnished by the defendant No. 1 bank from Delhi and since the communication of the defendant No. 2 invoking the bank guarantee was addressed to the defendant No. 1 bank at Delhi this court would have territorial jurisdiction.
9. Per contra, the counsel for the defendant No. 2 has pointed out that the bank guarantee as per its terms is payable at Guwahati. He has also drawn attention to Clause 46 of the invitation for bids which is as under:—
“All disputes shall be subject to the jurisdiction of appropriate court situated at Guwahati. The contract shall be interpreted in accordance with the laws of India.”
10. He has also contended that the payment under the bank guarantee was received by the defendant No. 2 from the defendant No. 1 bank, at Guwahati on 7th April, 2008 i.e before the order dated 8th April, 2008 making the action of the defendants subject to the order of the court. He has further contended that the place of issuance of the bank guarantee is irrelevant. Reliance is placed on; (i) Union Bank of India v. Seppo Rally OY, (1999) 8 SCC 357 though in relation to Consumer Protection Act, holding that the consumer fora at a place where the office of the party at whose instance the bank guarantee is furnished would have no jurisdiction to entertain the complaints qua the bank guarantee furnished by a branch of the bank situated outside Delhi; (ii) A.B.C Laminart Pvt. Ltd. v. A.P Agencies (1989) 2 SCC 163 on the proposition of the parties being entitled to restrict the territorial jurisdiction to one of the many courts having jurisdiction to entertain the disputes.
11. I may at the outset comment on a disturbing feature of this case. The plaintiff along with the plaint and the application for interim relief filed a list of documents dated 29th March, 2008 with documents. At serial No. 1, the document is “true photostat copy of the bid document” the same in the list of documents itself is described as comprising of seven pages. The defendant No. 2 along with its written statement has also filed a list of documents dated 20th May, 2008 along with documents and at serial No. 1 whereof also is the bid document. The same is a original/printed copy. A perusal of the bid document filed by the plaintiff and the bid document filed by the defendant No. 2 shows that the plaintiff has been selective in filing portions of the bid document. The plaintiff has not filed the page of the bid document containing Clause No. 46 aforesaid relating to territorial jurisdiction. Not only did the plaintiff conceal the relevant portion of the bid document as to territorial jurisdiction but also did not disclose the clause as to territorial jurisdiction in the plaint. Such action of the plaintiff is found to be deliberate, to obtain an order of injunction from this court to exclusion of whose jurisdiction the plaintiff had agreed. The plaintiff has indulged in judicial adventurism. The plaintiff, particularly Shri Harjot Singh Chatha, Director of the plaintiff company who has instituted the suit and signed and verified the plaint are thus found to be guilty of abusing of the process of this court and which this court in Satish Khosla v. Eli Lilly Ranbaxy Ltd. 71 (1998) DLT 1 : 1998 (44) DRJ 109 (DB) has held to be amounting to contempt of the court. The plaintiff owed a duty before approaching this court to make a clean breast of the state of affairs. The plaintiff sought ex parte interim relief from this court. The court relies upon the averments in the plaint and the documents filed therewith and grants such relief wherever the plaintiff is found entitled thereto. The plaintiff who seeks such a relief cannot be permitted to indulge in such practices. If the plaintiff felt that notwithstanding the aforesaid Clause 46 in the bid document it was entitled to invoke the territorial jurisdiction of this court, the plaintiff ought to have placed the same before this court and then made its submissions. On the contrary, the plaintiff attempted to gain an unfair advantage and steal a march.
12. The plaintiff has in the replication to the written statement of the defendant No. 2 not controverted the aforesaid clause in the bid document. The question which arises is whether in view of such clause in the invitation for bid, this court even if has jurisdiction, would have jurisdiction to entertain the suit. Undoubtedly, the clause aforesaid qua territorial jurisdiction does not use the words “exclusive” or “alone” or “only” or the like. However, the Supreme Court in A.B.C Laminart Pvt. Ltd. (Supra) and subsequently reiterated in Hanil Era Textiles Ltd. v. Puromatic Filters (P) Ltd.., AIR 2004 SC 2432 : 2004 (78) DRJ 635 (SC) has held that the absence of such words is not determinative; even without such words, in appropriate cases the maxim ‘expressio unius est exclusio alterius applies.
13. I find from the entirety of the facts in the present case that the parties had agreed to the exclusive jurisdiction of the courts at Guwahati. The terms of the invitation for bid were accepted by the plaintiff by making a bid. It is not the plaintiffs case that its bid was without agreeing to Clause No. 46 (Supra). The defendant No. 2 is the Government of Assam. The invitation for bid was issued from Guwahati for works to be performed in Guwahati and/or in the State of Assam. In the circumstances, the Clause 46 aforesaid is to be read as excluding the jurisdiction of courts at any other place even if otherwise having jurisdiction. The jurisdiction of this court is ousted for this reason alone and need is not felt to go into the question whether this court would have jurisdiction for the reason of the plaintiff as a bidder having furnished the bank guarantee of a bank within the jurisdiction of this court even though guaranteeing payment to the defendant No. 2 at Guwahati. It does not stand to logic that in such circumstances the place of bank issuing the guarantee would have jurisdiction. The defendant No. 2 while entertaining the bids is not concerned with the address of the bank issuing the guarantee so long as the payment under the guarantee is assured at the place of residence of the defendant No. 2 i.e Guwahati. It would be unfair to hold that territorial jurisdiction of places where the branch of the bank issuing the guarantee is situated can be invoked qua the disputes relating to the said guarantee. In the present case, the plaintiff was free to arrange the bank guarantee from a branch of the bank at any place and the defendant No. 2 cannot be made to run to that place for contesting a suit. I also do not find any merit in the plea of the invocation letter being issued to the defendant No. 1 bank at Delhi. The invocation letter would naturally be addressed to the bank issuing the bank guarantee. However, the core dispute is between the plaintiff and the defendant No. 2. The relief of injunction claimed against the defendant No. 1 bank is consequent to the relief of declaration which is qua the defendant No. 2 only. If this court does not have the territorial jurisdiction to entertain the dispute qua the relief of declaration, the question of entertaining the lis even if this court were to have jurisdiction qua the relief of injunction against the defendant No. 1 bank does not arise.
14. The preliminary issue qua territorial jurisdiction is thus answered in favour of the defendant No. 2 and against the plaintiff. This court has no territorial jurisdiction to entertain the suit. The plaint is accordingly ordered to be returned to the plaintiff for institution in accordance with law in the court of appropriate jurisdiction.
15. The plaintiff and particularly its Director Mr. Harjot Singh Chatha however, cannot be allowed to go scot free for their actions aforesaid of abusing the process of this court and playing fraud on this court and on defendant No. 2. As aforesaid, they are liable to be proceeded against for contempt of court. The law should not be seen to sit by limply, while those who defy it go free and those who seek its protection lose hope. The plaintiff has made the defendant No. 2 incur expenses in contesting this suit in a city whose jurisdiction had been agreed to be excluded. Following the dicta in G.E Countrywide Consumer Financial Services Ltd. v. Shri Prabhakar Kishan Khandare, MANU/DE/9276/2006, and in Nectar (U.K) Ltd.… v. Herbs Shop India Ltd. & Ors.…, 93 (2001) DLT 383 : 2001 (21) PTC 764 (DB), an opportunity is given to plaintiff and its Director aforesaid to purge the contempt by paying costs of Rs. 20,000/- to the counsel for the defendant No. 2 and of Rs. 30,000/- to the Delhi Legal Services Authority. If they fail to do so they would be liable to be proceeded against therefor.
List for reporting compliance of the same on 30th October, 2009.