Ashok Layland Finance Ltd. Vs Mr. Omer M.Ansari and Anr.

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IN THE HIGH ORDINARY		COURT OF JUDICATURE AT ORIGINAL CIVIL	BOMBAY JURISDICTION
ARBITRATION		PETITION NO.217 O	F 2004
Ashok Leyland Finance ltd. v/s		... Petitioners
Mr Omer M. Ansari and anr.		... Respondents
Ms Shakuntala		Joshi for	Petitioners.
Ms Bhandari i/b	Ms	Suman Jain for	Respondents.
CORAM : DATE :		D.K.DESHMUKH 17TH AUGUST	J. 2004

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P.C.:

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1.	This is	a petition filed u	nder section of the
Arbitration and	Concil	iation A	ct 1996. There	is	an
objection raised	by	the	respondents	to	the
maintainability of	the	petitio	n. According	to	the
provisions of the	said	Act, it	is only that Co	urt	before
which a suit	w	ould have	been filed, can ent	ertain	a
petition under section	9	of the	said Act. So far		as the
present petition	is	concerned,	admittedly the	a	greement,
which is the	sub	ject matter,	is entered into at		Pune.
The other aspect	for	the purp	ose of cause of act	ion	to
be considered is	the	breach	of contract. The	brea	ch of
contract in such		cases would	be at the plac	e	where
payment was to	be	made.	The contract itself d	oes	not
specify any place	w	here pay	ment can be made.		The
respondents were	carry	ing on	business in Bombay,		their
business has bee	n	shifted to	Pune. The case	of	the
respondents is	that	they wer	e making payment in		Pune.
The learned	coun	sel appea	ring for petitioners,		however,
relies on a judgm	ent	of the	learned Single Judge	o	f this
Court in the	case	of Kotak	Mahindra Finance Ltd.		v/s
Parasrampuria Synthet	ics	Ltd.,	reported in		1998(4)
Bom.C.R. 731.		Perusal of	the judgment shows	that	in

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that case, there was a clause in the agreement itself that the payment was to be made in Bombay. Obviously therefore, if there is failure to make payment, there will be breach of contract and as the payment was to be made in Bombay, the breach of contract would occur in Bombay and therefore, cause of action partly arises in

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Bombay and this Court had jurisdiction to entertain this petition.

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2.		The	learned counsel appearing for petitioners
relies	on	a judgmen	t in the case of New Mo	ga		Transport
Co.	v/s	United	India Insurance Co.Ltd.		and	others,
reported	in	(2004)	4 SCC 677. In that	ju	dgment,	the
Supreme		Court has	considered the provisions	of		section
20	of the	C.P.C.	However, in this case, what		is to	be
considered		is w	hether the petitioners would	h	ave	been
entitled	to	institut	e a suit on the Original		Side	of
this	Court.	In	so far as the Original Side		of	this
Court	is	concerned,	the C.P.C. has exclude	d		operation
of	section	20 of	the C.P.C. to the Original		Side	of
this	Court	and	the territorial jurisdiction		of	the
Original	Side	of t	he Bombay High Court	i	s to	be
considered		in acco	rdance with the provisions	o	f	clause
12	of the	Letter	Patent and not section 20.	S	o far	as
the	judgmen	t of the	Supreme Court in the case		of	South
East	Asia	Shipping	Co.Ltd. v/s Nav Bharat		E	nterprises

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Pvt.Ltd.	and	ot	hers,	reported in		(1996) 3	SC	C 443		is
concerned,	that	judgment	als	o deals	w	ith se	ction	20.		So
far	as the	judgment	of	the Suprem	e	Court	in	the	case	of
A.B.C.	Laminart	Pvt.L	td.	and anr.		v/s	A.P	.	Ag	encies,
Salem,	reported	in	(1989	) 2 SCC		163	is	concerned	,	there
also	the Su	preme	Cour	t defines		the t	erm	’caus	e	of
action.	It	is	now	settled law		that ca	use	of		action
arises	in	relation	to	a suit w	hi	ch is	i	nstituted		for
breach	of c	ontract	at	the pla	ce	whe	re	contrac	t	is
entered	into	as	also	at the pla	ce	where	the	breach		is
committed.	In	the	pre	sent case,		neither	the	contr	act	is
entered	into	in	Bo	mbay i	.e	.	within		ter	ritorial
jurisdiction	of	thi	s Co	urt nor b	re	ach is		occurred		in
Bombay.	In	this	v	iew of the		matter		therefore,		the

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present petition is not maintainable in this Court.

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Petition is rejected.

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. Parties to act on the copy of this order duly

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authenticated by the Associate / Personal Secretary as

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true copy.

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Certified copy expedited.

Ashok Layland Finance Ltd. v. Mr. Omer M.Ansari and Anr.

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Ashok Layland Finance Ltd. v. Mr. Omer M.Ansari and Anr.

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