Allowed

M/S.Oriental Insurance Co. Ltd. v. Baltic Shipping Sankit

Kerala HC7 Apr 2017AS/422/2001

Case brief

AI extract

What is this about?

The High Court allowed an appeal against the dismissal of a suit for recovery. The original court dismissed the suit due to lack of territorial jurisdiction. The High Court held that plaint averments established the presence of agents in India, granting the court jurisdiction.

What did the court decide?

Impugned judgment set aside; claim that the lower court had territorial jurisdiction upheld.

M/S.Oriental Insurance Co. Ltd. Vs Baltic… — Contract and Commercial Disputes | Kerala HC (2017)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE MR.JUSTICE V.CHITAMBARESH & THE HONOURABLE MR. JUSTICE SATHISH NINAN

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FRIDAY, THE 7TH DAY OF APRIL 2017/17TH CHAITHRA, 1939

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AS.No. 422 of 2001 ( )

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AGAINST THE JUDGMENT AND DECREE IN OS.1/1997 of PRINCIPAL SUB COURT,KOCHI DATED 30.09.2000

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APPELLANTS/PLAINTIFFS:

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1. ORIENTAL INSURANCE CO. LTD. A BODY CORPORATE INCORPORATED IN INDIA UNDER THE COMPANIES ACT, 1956, A SUBSIDIARY OF GENERAL INSURANCE CORPORATION OF INDIA, ITS REGISTERED OFFICE AT ORIENTAL HOUSE, ASAF ALI ROAD, NEW-DELHI 110 002, DIVISIONAL AND REGIONAL OFFICERS AT VARIOUS PLACES IN INDIA INCLUDING ONE AT MUTHOOT TOWERS, IIIRD FLOOR, P.B NO.3211, M.G.ROAD, COCHIN-35, REPRESENTED BY ITS REGIONAL MANAGER, REGIONAL OFFICE, MUTHOOT TOWERS, M.G. ROAD, KOCHI-35 2. GUJARAT SMALL INDUSTRIES CORP. LTD., HAVING THEIR REGD. OFFICE AT BHAGWATI CHAMBERS, OPPOSITE GUJARAT VIDYAPITH, ASHRAM ROAD, AHAMEDABAD – 380 014, REPRESENTED BY ITS POWER HOLDER APPELLANT NO.1 HEREIN.

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BY ADV. SRI.V.V.ASOKAN

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RESPONDENTS/DEFENDANTS:

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1. BALTIC SHIPPING SANKT. ST.PETERSBURG, RUSSIA REPRESENTED BY THEIR AGENTS IN INDIA, GAC SHIPPING(INDIA) LTD. P.B NO. 515, SUBRAMANIAN ROAD, WILLINGDON ISLAND, KOCHI – 3. 2. ALENTIAS SHIPPING SERVICES OF CYPRUS, REPRESENTED BY THEIR AGENTS IN INDIA, GAC SHIPPING (INDIA) LTD., P.B NO.515, SUBRAMANIAN ROAD, WILLINGDON ISLAND, KOCHI – 3. 3. GAC SHIPPING (INDIA) LTD., P.B NO.515, SUBRAMANIAN ROAD, WILLINGDON ISLAND, KOCHI-3 R1 TO 3 BY ADV. SRI.V.J.MATHEW ADV. SRI.P.P.RAJESH ADV. SRI.SABU P.JOSEPH THIS APPEAL SUITS HAVING BEEN FINALLY HEARD ON 04-04-2017, THE COURT ON 07.04.2017 DELIVERED THE FOLLOWING:

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V.Chitambaresh & Sathish Ninan, JJ. ==============================

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A.S No.422 of 2001

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==========================

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Dated this the 07^th day of April, 2017

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JUDGMENT

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Sathish Ninan, J

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Holding that the court does not have territorial jurisdiction to entertain the suit, a suit for

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recovery of money has been dismissed by the court below.

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The first plaintiff is an Insurance Company. The second plaintiff, the consignee, is a company owned by the Government of Gujarat and is represented by the first plaintiff as the power of attorney holder. The first defendant is the owner of the vessel 'M.V.Primorsk'. The second defendant is the charterer of the vessel. The third defendant is the agent of defendants 1 and 2. 6,000 metric tonnes of Polypropylene was shipped as per Exts.B70 to B81

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bills of lading, in the vessel 'M.V.Primorsk' The consignor was M/s G.A. International, Dubai, U.A.E.

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The consignment was shipped from Mexico to be

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A.S No.422/2001

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delivered at Kandla, Gujarat. On delivery it was found that some of the goods were spoiled and also that there was short delivery. The first plaintiff Insurance Company settled the claim of the second plaintiff. The suit is filed for realisation of the said amount.

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The court below found that no part of the cause of action arose within the territorial jurisdiction of the court and accordingly held that it has no jurisdiction to entertain and try the suit. According to the court, the cause of action has arisen at Kandla, Dubai and Mexico and therefore, the suit is not maintainable in the court at Kochi.

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Question of jurisdiction is to be decided primarily on the plaint averments. In paragraph 2 of the plaint it has been specifically alleged that defendants 1 and 2 are represented by their main agents in India, the third defendant, and that the third defendant has transacted the entire business of defendants 1 and 2.

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A.S No.422/2001

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It would be relevant to refer paragraph 2 of the plaint, which reads as under:

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“The 1^st defendant is the owner of 'M.V.Primorsk' a vessel flying Russia Flag. The 2^nd defendant appears to be charters of M.V Primorsk which belongs to the 1^st defendant. The 1^st and 2^nd defendants are represented by their Main Agents in India, M/s GAC Shipping (India) Ltd., Willingdon Island, Cochin-3. The 3^rd defendant is transacting the entire business of 1^st and 2^nd defendants in all major ports directly or through sub-agents appointed at their risk and discretion for customers who are exporting or importing the goods through 1^st or 2^nd defendant arrangements are made by 3^rd defendant. Under the custom and all practical purposes business is independently transacted by the 3^rd defendant.”

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The definite allegation of the plaintiffs is that the third defendant along with defendants 1 and 2 are liable for the plaint amount since they act as representative and agent of defendants 1 and 2 and the business of defendants 1 and 2 is being transacted through third defendant. The relief claimed in the

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A.S No.422/2001

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suit is also against all the defendants jointly and severally. Defendants 2 and 3 filed a joint written statement wherein the contention appears to be that the agency of the third defendant is limited to some particular work alone. Therefore, it is admitted that the third defendant is the agent of the second defendant, though there is dispute regarding the scope of the agency and its liability. The scope of the agency is something to be looked into on the merits of the matter, as to whether the third defendant will be liable for the plaint claim or not.

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It is also worthwhile to refer to the averments in

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paragraph 11 of the written statement to the effect that:

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“The plaintiffs have no right to raise any claim against the defendants No.2 & 3, though the 3^rd defendant is the principal agent and S.D.S Shipping Pvt.Ltd. Who is the sub agent who had done entire agency work of the said vessel on behalf of the defendant No.3. ”

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Therein it is admitted that one S.D.S Shipping

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A.S No.422/2001

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Private Limited is the sub agent. Ext.A2 is a communication by the said S.D.S Corporation wherein they acknowledged that they are the sub agents of the third defendant. Ext.A7 is a communication by the first plaintiff to the third defendant referring to the claim. Ext.A8 is a communication by the third defendant to the first plaintiff regarding the claim wherein it is stated that they have informed regarding the claim to their principals.

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Suffice to say that the plaint averments when considered along with the documents produced prima facie show the involvement of the third defendant in the transaction and that the court below had jurisdiction to entertain the suit. The finding of the court below to the contrary is unsustainable. If at all the court below was of the opinion that it lacked territorial jurisdiction to entertain the suit, it ought to have ordered return of the plaint in terms of Order VII Rule 10 of the Code of Civil Procedure.

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A.S No.422/2001

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In the result, the appeal is allowed. Impugned judgment is set aside. Court fee to be refunded. It is held that the court below has territorial jurisdiction to entertain the suit. The suit shall be considered and disposed of on its merits.

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The court below shall on receipt of a copy of this judgment fix the date of appearance and notify the parties accordingly.

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Sd/- V.Chitambaresh, Judge

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Sd/- Sathish Ninan, Judge

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vdv

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//TRUE COPY//

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P.A TO JUDGE

M/S.Oriental Insurance Co. Ltd. v. Baltic Shipping Sankit

Case brief

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What did the court decide?

M/S.Oriental Insurance Co. Ltd. v. Baltic Shipping Sankit

Case brief

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What did the court decide?

What the court decided

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