Case Note & Summary
The appellant, Isha Distribution House Pvt. Ltd., filed a civil suit (Civil Suit No.88/2016) in the Calcutta High Court against Aditya Birla Nuvo Ltd. and another, seeking a declaration that the termination of two agreements dated 11.07.2007 and 21.05.2008 was wrongful, along with damages and injunction. The appellant obtained leave under Clause 12 of the Letters Patent Act, 1865 to file the suit. The respondents entered appearance and filed an application for revocation of leave, arguing that no part of the cause of action arose within the territorial jurisdiction of the Calcutta High Court, but rather in Bangalore. The Single Judge allowed the application and revoked the leave. The appellant appealed to the Division Bench, which dismissed the appeal and the subsequent review petition. The appellant then appealed to the Supreme Court by special leave. The Supreme Court considered the short question of whether the High Court was justified in revoking the leave. The Court noted that the law, as laid down in Secretary of State v. Golabrai Paliram (AIR 1932 Calcutta 146) and affirmed in Indian Mineral & Chemicals Co. v. Deutsche Bank (2004) 12 SCC 376, is that an application for revocation of leave should not be entertained except in the clearest cases; the proper course is for the defendant to file a written statement and raise the plea of territorial jurisdiction as a substantive defence. The Court held that the plea of territorial jurisdiction is a mixed question of law and fact, and should be tried after framing issues under Order 14 of the Code of Civil Procedure, 1908. Accordingly, the Supreme Court allowed the appeals, set aside the impugned orders and the Single Judge's order, dismissed the respondents' application for revocation of leave, and granted liberty to the respondents to file a written statement raising the plea of territorial jurisdiction along with other pleas. The Single Judge was directed to frame issues and decide the matter afresh in accordance with law, without being influenced by any previous observations.
Headnote
A) Civil Procedure - Territorial Jurisdiction - Revocation of Leave - Clause 12, Letters Patent Act, 1865 - The court held that an application for revocation of leave should not be entertained except in the clearest cases; the proper course is for the defendant to file a written statement and raise the plea of territorial jurisdiction as a substantive defence. The court relied on Secretary of State v. Golabrai Paliram (AIR 1932 Calcutta 146) and Indian Mineral & Chemicals Co. v. Deutsche Bank (2004) 12 SCC 376. (Paras 14-20) B) Civil Procedure - Mixed Question of Law and Fact - Territorial Jurisdiction - Order 14, Code of Civil Procedure, 1908 - The court observed that a plea of territorial jurisdiction is essentially a mixed question of law and fact, and therefore, should be tried on merits after framing issues under Order 14 CPC, rather than through a summary revocation application. (Para 20)
Issue of Consideration
Whether the High Court was justified in revoking the leave granted to the appellant to file a civil suit under Clause 12 of the Letters Patent Act, 1865, on an application by the respondents, without requiring them to file a written statement and raise the plea of territorial jurisdiction therein.
Final Decision
The Supreme Court allowed the appeals, set aside the impugned orders and the Single Judge's order dated 28.07.2016, dismissed the respondents' application for revocation of leave, and granted liberty to the respondents to file a written statement raising the plea of territorial jurisdiction along with other pleas. The Single Judge was directed to frame issues under Order 14 CPC and decide the matter afresh in accordance with law, without being influenced by any previous observations.
Law Points
- Revocation of leave under Clause 12 of Letters Patent Act
- 1865 should not be entertained except in clearest cases
- plea of territorial jurisdiction is a mixed question of law and fact to be raised in written statement
- proper course is to file written statement and raise jurisdiction plea therein.
