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Board Of Trustees For The Port Of Calcutta And Another v. Bombay Flour Mills Pvt. Ltd. And Another
Factual and Procedural Background
The respondent imported 63 cases of Rolling Mills through the Port of Calcutta in October 1988. The goods were unloaded at Shed No. 3, Netaji Subhas Docks, which are under the control of the appellant. Under the prescribed Scale of Rates, the respondent was required to clear the consignment after paying demurrage, but failed to do so. On 27-3-1989 the respondent sought a waiver of port charges; the appellant refused.
Subsequently, on 18-4-1989 the respondent instituted a suit in the District Court at Bharatpur, Rajasthan, and on 22-4-1989 obtained an ex-parte ad-interim mandatory injunction directing the appellant to release the goods upon payment of Rs 2,26,674, even though Rs 7,37,400 was allegedly due. The appellant challenged this order before the Rajasthan High Court by way of Civil Appeal (Writ) No. 409 of 1992, but the High Court dismissed the appeal on 7-2-1994.
The appellant then approached the Supreme Court of India by special leave. On 5-9-1994 the Supreme Court permitted substituted service, which was effected through publication in The Hindustan Times on 19-9-1994. No appearance was entered for the respondents, and service was deemed complete.
Legal Issues Presented
- Whether any part of the cause of action arose within the territorial jurisdiction of the District Court at Bharatpur, Rajasthan.
- Whether, under Section 20 of the Code of Civil Procedure, 1908, the only competent court to entertain the suit was the appropriate court at Calcutta.
- Consequently, whether the orders of the District Court, Bharatpur, and the Rajasthan High Court were void for lack of jurisdiction.
Arguments of the Parties
The opinion does not contain a detailed account of the parties' legal arguments.
Table of Precedents Cited
No precedents were cited in the provided opinion.
Court's Reasoning and Analysis
The Supreme Court noted that the entire cause of action—importation, unloading of goods, accrual of demurrage, and the appellant’s office—was situated in Calcutta. Under Section 20 of the Code of Civil Procedure, a suit must be instituted where the defendants reside or where the cause of action arises. Because no part of the cause of action arose at Bharatpur, the District Court there lacked territorial jurisdiction.
As a result, the ex-parte mandatory injunction issued by the Bharatpur court was declared void ab initio. The Court further held that the Rajasthan High Court committed a “manifest error of law” in refusing to set aside an order that was plainly without jurisdiction.
Holding and Implications
Appeal Allowed; orders of the Rajasthan High Court and the District Court, Bharatpur, set aside.
Direct Effect: The injunction compelling the appellant to release the goods on reduced payment stands nullified. The respondent must pursue any claim, if at all, before the appropriate court at Calcutta.
Broader Implications: The decision reinforces the mandatory application of Section 20 CPC on territorial jurisdiction but does not announce any new legal doctrine.
Order
1. Pursuant to the order passed by this Court on 5-9-1994 the appellant had taken substituted service, and served respondents by publishing “Court Notice” in The Hindustan Times newspaper, New Delhi, Monday dated 19-9-1994 (Annexure B) at page 115. Although nobody appears for the respondents, notice must be deemed to have been served on the respondents.
2. Leave granted.
3. This appeal by special leave arises from the order of Division Bench of the Rajasthan High Court dated 7-2-1994 made in Civil Appeal (Writ) No. 409 of 1992.
4. The respondent had consignment of Rolling Mills in 63 cases, imported at the Port of Calcutta in October 1988 and got unloaded at No. 3 shed, Netaji Subhas Docks of the appellants between October 11 to 17, 1988. Respondent 1 was required to obtain delivery of the goods as per the prescribed Scale of Rates but he failed to have them cleared after making payment of demurrage. He made a representation on 27-3-1989 requesting the appellants to waive the port charges and release the goods. Since the appellant refused to do so, on 18-4-1989, the respondent approached the District Court at Bharatpur, Rajasthan and obtained an ex parte ad interim mandatory injunction on 22-4-1989 directing the appellant to release the goods within two days on payment of the sum of Rs 2,26,674.00 (Two lakhs, twenty-six thousand, six hundred and seventy-four only) being made while the respondent was due in a sum of Rs 7,37,400 to the appellant. When the appellant approached the High Court of Rajasthan by way of Civil Appeal (Writ), the High Court dismissed the same.
5. It is seen that the cause of action had arisen at Calcutta when the goods were imported and they were unloaded at Shed No. 3, Netaji Subhas Docks of the appellant and the liability of payment had also arisen and on its failure to clear the goods the respondent instituted the suit in District Court at Bharatpur, Rajasthan. No part of the cause of action arose at Bharatpur. The appellant's office is at Calcutta. Under Section 20 CPC the only court competent to take cognizance of the action is the appropriate court at Calcutta. The order passed by the District Court, Bharatpur in the suit filed by the respondent, is without jurisdiction and is void. When the appellant, approached the High Court, it has dismissed the case. Therefore, High Court has committed manifest error of law in refusing to interfere with such an obviously illegal and void order. Therefore, the impugned order passed by the High Court of Rajasthan and District Court, Bharatpur are set aside. The appeal is accordingly allowed. No costs as none appears in the Court.
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