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Cts Industries Ltd. Vs. Gammon India Ltd. and Anr. - Court Judgment

LegalCrystal Citation
CourtKolkata High Court
Decided On
Judge
AppellantCts Industries Ltd.
RespondentGammon India Ltd. and Anr.
Excerpt:
.....that the work order of april 14, 2010, under which the claim has been made, is governed by a forum selection clause which has been completely glossed over in the plaint. the firs.defendant refers to the pre-suit notice of demand of september 26, 2013 and the reference in such demand to the work order of april 14, 2010 as being the contract under which the demand was raised. however, the plaintiff does not exclusively claim under the said work order of april 14, 2010 and there is another supply order of july 22, 2010 under which a part of the claim has been made. the plaintiff was to supply goods to the firs.defendant for construction of roads. the work order of april 14, 2010 pertained to state highway no.69 in bihar and the supply order of july 22, 2010 was in respect of a project.....
Judgment:

ORDER

SHEET G.A.No.359 of 2014 C.S.No.11 of 2014 IN THE HIGH COURT AT CALCUTTA Ordinary Original Civil Jurisdiction ORIGINAL SIDE CTS INDUSTRIES LTD.Versus GAMMON INDIA LTD.& ANR.

BEFORE: The Hon'ble JUSTICE SANJIB BANERJEE Date : 5th September, 2016.

For Plaintiff : Mr.Jishnu Saha, Sr.Adv.with Mr.Ashis Kr.

Mukherjee, Ms.Sulagna Mukherjee & Mr.Sushil Kr.

Sewak, Adversus For Defendant no.1 : Mr.Utpal Bose, Sr.Adv.with Mr.Swatarup Banerjee & Mr.Rohit Mukherjee, Adversus The fiRs.defendant has applied for revocation of the leave granted under Clause 12 of the Letters Patent on the ground that the work order of April 14, 2010, under which the claim has been made, is governed by a forum selection clause which has been completely glossed over in the plaint.

The fiRs.defendant refers to the pre-suit notice of demand of September 26, 2013 and the reference in such demand to the work order of April 14, 2010 as being the contract under which the demand was raised.

However, the plaintiff does not exclusively claim under the said work order of April 14, 2010 and there is another supply order of July 22, 2010 under which a part of the claim has been made.

The plaintiff was to supply goods to the fiRs.defendant for construction of roads.

The work order of April 14, 2010 pertained to State Highway No.69 in Bihar and the supply order of July 22, 2010 was in respect of a project in Kodarma in Jharkhand.

The plaint does not clearly indicate whether the claim made therein pertains exclusively to the work order of April 14, 2010 or exclusively to the supply order of July 22, 2010 or to both.

The suit was instituted early in 2014 as the number of the suit would indicate.

The fiRs.defendant relies on a recent judgment of this Court reported at 2016 SCC Online Calcutta 4208 where it was held that even though the Code of Civil Procedure, 1908, does not make an exacting demand on the plaintiff to plead a forum selection clause, unlike limitation and territorial jurisdiction, when a suit is instituted contrary to a forum selection clause governing the dispute between the parties, some modicum of reasons should be indicated as to why the forum selection clause would not apply.

In the opposition filed by the plaintiff, it has been alleged that the claim in the suit pertains to the supply order of July 22, 2010 which did not contain any forum selection clause.

Implicit in such assertion of the defendant is that the claim does not pertain to the work order of April 14, 2010.

It is possible that the claim in the suit is based on both the work order of April 14, 2010 and the supply order of July 22, 2010.

The plaintiff may have referred to the forum selection clause contained in the work order of April 14, 2010 and may have justified the institution of this suit in this Court if the larger claim was based on the supply order of July 22, 2010.

Ordinarily, in respect of such a claim, the Court may not have required the plaintiff to institute two separate actions.

Either the plaintiff may have been asked to go to the appropriate Court in Mumbai in view of the forum selection clause contained in the work order of April 14, 2010; or the Court would have continued with the action here since the larger claim was under the supply order of July 22, 2010.

But since the plaintiff has done itself this disservice of seeking to claim under the work order of April 14, 2010 and the supply order of July 22, 2010 by suppressing the existence of forum selection clause in the earlier document, the plaintiff will have to suffer the consequences therefor.

The fiRs.defendant has placed the relevant clause contained in the work order dated April 14, 2010: “k.

Jurisdiction: All disputes between the GIL and CTS under this work order shall be deemed to have arisen in Site and only the Mumbai Court alone shall have jurisdiction to determine the same.

The work order shall be governed by the law of India and the language for communication shall be English.” The plaintiff contends that the forum selection clause is vague and, in any event, illegal since the deeming provision therein is contrary to law.

The plaintiff also suggests that the appropriate court in Mumbai is not identified by the clause.

The most fundamental principle in interpreting contracts is to give effect to the agreement between the parties, to the extent it is not impermissible.

The corollary to such rule is that to the extent the agreement or a clause in the agreement can be upheld by reading down or ignoring that part thereof that may be illegal, such an attempt should be made.

Even if the plaintiff’s argument as to the fiRs.limb of the opening sentence in clause ‘k’ of the work order dated April 14, 2010 is accepted, it will not impinge upon that part of the sentence that provides that “only the Mumbai Court alone shall have jurisdiction to determine the … disputes between the GIL and CTS under this work order”.

It is also a basic tenet of interpretation of contracts that the purpose of the interpretation is to further the consensus between the parties reflected in an agreement; and not to pick faults therein to render the same inapplicable or unenforceable.

It is true that there could be several courts in Mumbai which may be capable of receiving an action in respect of the relevant work order, though the plaintiff has not indicated the several courts in such regard.

Even if the plaintiff’s contention is accepted at face value, what is inescapable is that the parties mandated that only some court in Mumbai would have the jurisdiction to determine the disputes pertaining to the relevant work order.

The choice of courts could be on account of pecuniary consideration; for, it cannot be said that a claim that could only have been carried to the Small Causes Court in Mumbai on the basis of its pecuniary value had to be carried to the original side of the Bombay High Court just because the agreement had provided for the Bombay High Court to be the only forum of choice.

It is the underlying consensus of the parties which has to be respected and given effect to; even if a specific court is not identified by the forum selection clause in a particular case, once the venue is indicated, it is an appropriate court otherwise entitled in law to receive the action which has to be regarded as the forum of choice.

In view of the unimpeachable forum selection clause contained in the work order of April 14, 2010, the plaintiff herein could not have carried a claim under such work order to any court other than the specified court or specified set of courts.

The consideration may have been somewhat different if the plaintiff had made a clean breast of the material facts in the plaint.

The court may then have permitted the claim under the work order to be clubbed along with the claim under the supply order of July 22, 2010 by recognising the larger public policy of avoiding a multiplicity of proceedings.

The claim in this suit will be assessed on merits to the extent the same is under the supply order of July 22, 2010, which is not governed by any forum selection clause, and no claim under the work order of April 14, 2010 will be considered in this suit or at its trial.

G.A.No.359 of 2014 is disposed of accordingly, but without any order as to costs.

Urgent certified website copies of this order, if applied for, be given to the parties subject to compliance with all requisite formalities.

(SANJIB BANERJEE, J.) K.

Banerjee A.R.[C.R.].


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