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Fertilizer Corporation of India Ltd. Vs. Sanjit Kumar Ghosh and anr. - Court Judgment

LegalCrystal Citation
SubjectContract
CourtPunjab and Haryana High Court
Decided On
Case NumberF.A.F.O. No. 88 of 1961
Judge
Reported inAIR1965P& H107
ActsCode of Civil Procedure (CPC), 1908 - Sections 20
AppellantFertilizer Corporation of India Ltd.
RespondentSanjit Kumar Ghosh and anr.
Cases ReferredLtd v. District Board Gaya
Excerpt:
.....judgment or order of a single judge to a division bench notwithstanding anything contained in the letters patent. the letters patent which provides for further appeal to a division bench remains intact, but the right to prefer a further appeal is taken away even in respect of the matters arising under the special enactments or other instruments having the force of law be it against original/appellate decree or order heard and decided by a single judge. it has to be kept in mind that the special statute only provide for an appeal to the high court. it has not made any provision for filing appeal to a division bench against the judgment or decree or order of a single judge. no letters patent appeal shall lie against a judgment/order passed by a single judge in an appeal arising out of a..........which though raised in the plaint has not been specifically touched upon by the court below. the letter of resignation is said to have been sent by the first respondent to the company in june, 1958, and this was accepted by the plaintiff in a letter of 10th april, 1959, subject to the condition that 'he should refund all the monies spent by the company upon him in the shape of payment of stipends and training charges paid to sindri management.' though it is stated in paragraph 10 of the plaint that the cause of action arose on 13th of june, 1958, from which date the first respondent absented himself form sindri, the pleadings have to be read liberally and if the revocation of the contract was made at hoshiarpur that would provide a cause of action to the plaintiff. now, the letter of.....
Judgment:

1. The plaint presented by Hindustan Chemicals and Fertilizers Limited in a suit instituted by it against the respondents Sanjit Kumar Ghosh and Arun Kumar Ghosh for recovery of a sum of Rs, 8,602. 14P. having been returned by the trial Judge at Hoshiarpur for presentation before a proper Court the plaintiff has come in appeal to this Court.

(2) The appellant company is stated to be a successor of Nangal Fertilizers and Chemicals Private Limited which advertised in 1956 for a few jobs of Graduate Apprentices 'in the Nangal Fertilizers and Chemicals Private Limited New Delhi.' The first respondent Sanjit Kumar Ghosh was selected for this job and the letter of appointment of 1st of November 1956, makes mention, inter alia, of the following conditions for this appointment:--

'(2) Selection as an apprentice does not guarantee employment under the Company. Selected candidates will, however, have to enter into an agreement with the Company to serve it for a minimum period of 3 years if required to do so after the apprenticeship period is over.

(3) On satisfactory completion of training the trainees will be employed in suitable supervisory positions and they may be required to serve either at Nangal or anywhere in India at discretion of the management.

(7) You will be required to execute the attached Surety Bond before joining the post'

(3) In the plaint it is also stated that 'in case of breach of any of these terms or for any misconduct or misdemeanour on the part of defendant No. 1, the company reserved to itself the right to demand and recover all or any part of the expenses incurred on the training of defendant No. 1 and the monies paid to him as stipends and allowances during the training period.'

(4) A stipend of Rs. 150/- per mensem was to be paid to the apprentice for the period of training which was said to be between two to three years. The place apprenticeship was Sindri, near Dhanbad in Bihar. The appointment was accepted by the first respondent by his letter of 12th of November 1956 and he reported himself for duty on 7th of December 1956. The second respondent Arun Kumar Ghosh executed the surety bond and made himself responsible to reimburse the employer for expenses incurred on the training of the first respondent in case of any breach in the terms and conditions of the contract.

(5) The first respondent according to the plaint, remained with the Sindri Chemicals and Fertilizer Limited for training till 13th of June, 1958, when he applied for ten day's casual leave. After the expiry of the leave the first respondent did not report himself for duty and submitted his resignation without assigning any reasons. This resignation according to the assertions in the plantain, paragraph 7, is said to have been accepted by a letter of the 10th of April, 1959 on the condition that the first respondent should refund all the moneys spent by the plaintiff upon him in payment of stipends and charges defrayed towards his training at Sindri.

(6) The amount claimed from the respondent is made up of the following items.

'(1) Stipends paid to defendant No.1. Rs. 4,094.37 nP.

(2) Training charges paid to Sindri Fertilizers. Rs. 3,380.33 nP.

(3) Interest at the rate of 6% on the amount Rs. 1,127.44 nP.

according to the conditions of the bond

upto the date of the institution of the suit.

.................................

Rs. 8,602.14 nP.

(7) The cause of action according to the plaint, arose at Nangal on 13th of June,1958, when the breach of contract occurred there. The agreement of employment is said to have accepted at Nangal where the first respondent was required to render service, according to the terms of the agreement.

(8) It is not necessary to refer to pleas of the defendants in detail and it would suffice of purposes of this appeal to say that the jurisdiction of the Hoshiarpur Court to entertain the suit having been challenged a preliminary issue was framed to settle this question in the following terms:

'Whether the civil Court at Hoshiapur has territorial jurisdiction to try the suit?'

(9) It is common ground that the agreement of employment was executed at Delhi and not at Nangal and therefore, this ground is not available to give a cause of action to the Court of Hoshiarpur within whose jurisdiction Nangal is situated. In the view of the learned trial Judge, condition No. 3 of the contract of employment required the first respondent to serve at Nangal or anywhere in India at the discretion of the management and this could not justify the Court at Hoshiarpur to entertain the suit as the description of place of service ' at Nangal or anywhere in India,' was vague and uncertain. It is no doubt true that on the successful termination of the period of training, the first respondent was to serve with the plaintiff company for a minimum period of 3 years at Nangal or anywhere else in India, but this future service was to be regulated by a separate agreement which had yet to be executed. The Trial Judge held that the Hoshiapur Court had no jurisdiction to try the suit, no part of the suit, no part of the clause of action having arise at Nangal.

(10) In appeal, it has been urged Mr. Durga Dass Jain, the learned counsel for the appellant that the first respondent having disabled himself by resignation from serving the company for a minimum period of three years committed a breach of contract of employment and this has given the requisite cause of action under section 20 of the Code of Civil Procedure. A suit, under S. 20, in a Code of Civil Procedure has to be instituted in a Court within the local limits of whose jurisdiction the defendant resides or ' the cause of action, as held by their Lordships of the Privy Council in Mohammad Khalil v. Mahbub Ali, AIR 1949 P.C. 78 means

'every fact which will be necessary for the plaintiff to prove if traversed in order to support his right to the judgment' and ' has no relation whatever to the defence that may be set up by the defendant nor does it depend upon the character of the relief prayed for by the plaintiff. It refers to the media upon which the plaintiff asks the court to arrive at a conclusion in his favour.'

The ground on which it claimed that the cause of action has arisen within the jurisdiction of Hoshiarpur Courts is that the performance of the contract had to be made at Nangal or any where in India. It is submitted that Nangal is at least a definite place where the first respondent might have been required to serve if he had not resigned before the period of his training was over and the suit, therefore, competent. Reliance is placed on a single bench authority of Ramaswami J. in G. Venkatesha Bhat v. Kamlapat Motilal AIR 1957 Mad 201, for the proposition that the performance of a contract is part of the cause of action and a suit in respect of breach can always be filed at the place where the contract should have been performed or its performance completed. Now, it cannot be denied that the performance of a contract is an integral part of the cause of action but it is equally important to note that the cause of action must have actually for performance of a contract is an integral part of the cause of action but it is equally important to note that the cause of action must have actually arisen when the suit filed. Admittedly the time for performance of the contract had not arrived when the suit was brought, the first respondent It has been held by a Division Bench of the Calcutta High Court of Chief Justice Harries and Banerjee J. in Dominion of India v. Nath and Co. Kulna, AIR 1950 Cal 207, that a notification published after filing of the suit cannot form part of the cause of action. Reference may also be made to a Division Bench Judgment of the Patna High Court of Chief Justice Dawson-Miller and Roe J. in Gobind Ramanuj Das v. Devendrabala Dasi, AIR 1919 Pat 507. where it was said at page 510 that :--

'It is well settled that a cause of action must be antecedent to the institution of the suit and connote arise from pleadings themselves.'

(11) There does not, therefore, seem to be much force in the submission of Mr. Jain that the future expectation of the performance of contract at Nangal constitutes a part of the cause of action.

(12) There is, however, one other aspect of the case which though raised in the plaint has not been specifically touched upon by the court below. The letter of resignation is said to have been sent by the first respondent to the company in June, 1958, and this was accepted by the plaintiff in a letter of 10th April, 1959, subject to the condition that 'he should refund all the monies spent by the company upon him in the shape of payment of stipends and training charges paid to Sindri management.' Though it is stated in paragraph 10 of the plaint that the cause of action arose on 13th of June, 1958, from which date the first respondent absented himself form Sindri, the pleadings have to be read liberally and if the revocation of the contract was made at Hoshiarpur that would provide a cause of action to the plaintiff. Now, the letter of resignation was sent from Sindri but it was received by the company at Nanhal from where the letter of 10th April, 1959 was despatched in which the resignation was accepted subject to the condition of refund Under S. 4 of the India Contract Act:--

The communication of a revocation is complete as against the person who makes it, when it is put into a course of transmission to the person to whom it is made, so as to be out of power of the person who makes it; as against the person to whom it is made when it comes to his knowledge.'

(13) It seems to me that in order to succeed in this suit it would be essential for the plaintiff to prove that the resignation of the first respondent was accepted subject to the condition of his making the refund. What the first respondent was required to refund was the amount spent on this stipends and the training charges defrayed by payment to Sindri Fertilizers. These are precisely the two amounts which have been claimed to be recoverable from the first respondent. They could be recovered only in pursuance of the letter of resignation sent by the first respondent and received by the plaintiff at Nangal and the plaintiff's reply which 1959. It has been held in a Division Bench Judgment of the Patna High Court (Fazl Ali C.J. and Ray J.) in Arthur Butlar and Co., Ltd v. District Board Gaya, ILR 25 Pat 292: (AIR 1947 Pat 134) that

'revocation of a contract is part of the cause of action in a suit for breach of a contract an therefore the place where the contract is revoked may determine the cause (forum?) of action. Where a contract which was completed with the plaintiff at G was cancelled or revoked at M by a telegram which was followed by a letter, and the plaintiff sued for damages for breach of the contract in a court situate at 'M', alleging the receipt of the telegram and letter at 'M' held that the court at 'M', had full jurisdiction to try the suit.'

It would be seen that the letter of resignation was received by the plaintiff company at Nangal from where it despatched the letter in reply. Both these bundles of facts have to be proved before the suit of the plaintiff can be decreed. Irrespective of pleas raised by the defendant, the cause of action is determinable by the assertion made in the plaint and looked in this perspective I am of the view that the Court at Hoshiarpur has jurisdiction to try the suit.

(14) I would, accordingly, allow this appeal and remand this case to the trial Judge before whom the parties have been directed to appear on 28th of September,1964. The trial Judge will, there after proceed with the trial of the case in accordance with law. The costs would abide the event.

(15) Appeal allowed.


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