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Naskarpara Jute Mills Co. Ltd. Vs. Nirmal Kumar Jain - Court Judgment

LegalCrystal Citation
SubjectContract
CourtKolkata
Decided On
Reported inAIR1941Cal434
AppellantNaskarpara Jute Mills Co. Ltd.
RespondentNirmal Kumar Jain
Cases ReferredBepin Behari v. Jogendra Chandra
Excerpt:
- .....the jurisdiction, and the contract notes were passed by him to the parties in calcutta. in the arrah suit, the defendant, nirmal kumar jain, has sued the howrah trading co. ltd., the naskarpara jute mills co. ltd., and one jaganath das jain, for a declaration inter alia that the contract to which i have referred is void. he alleges that prior to the making of that contract, the howrah trading co. ltd., and the naskarpara jute mills co. ltd., sent their munib to arrah and induced the plaintiff to agree to enter into contract transactions by way of gaming and wagering with the defendant, for the purchase and sale of hessian cloth, that it was agreed that performance of such contracts of purchase and sale would not be demanded by either party, and that no delivery would be given or.....
Judgment:
ORDER

Lort-Williams, J.

1. This is a petition by the plaintiffs, the Naskarpara Jute Mills Co. Ltd., against the defendant, Nirmal Kumar Jain, in suit No. 2053 of 1940. In that suit the plaintiffs allege that by an agreement dated 24th November 1939 the plaintiffs, through their managing agents, Messrs. The Howrah Trading Co. Ltd., sold to the defendant certain hessian cloth through the agency of Basani Lal Masudi, acting as broker for both parties. The defendant failed to take delivery of some of the cloth which was subsequently sold by the plaintiffs who claim the difference between the contract and the market price. The written contract of sale contained an arbitration clause. The plaintiffs allege that in order to avoid payment and to defeat the arbitration proceedings, defendant has filed a suit in the Court of the Subordinate Judge at Arrah in Bihar, being title suit No. 34 of 1940. They allege that the defendant at all material times resided in Calcutta and carried on business there and had his office within the jurisdiction.

2. The broker also resides within the jurisdiction, and the contract notes were passed by him to the parties in Calcutta. In the Arrah suit, the defendant, Nirmal Kumar Jain, has sued the Howrah Trading Co. Ltd., the Naskarpara Jute Mills Co. Ltd., and one Jaganath Das Jain, for a declaration inter alia that the contract to which I have referred is void. He alleges that prior to the making of that contract, the Howrah Trading Co. Ltd., and the Naskarpara Jute Mills Co. Ltd., sent their munib to Arrah and induced the plaintiff to agree to enter into contract transactions by way of gaming and wagering with the defendant, for the purchase and sale of hessian cloth, that it was agreed that performance of such contracts of purchase and sale would not be demanded by either party, and that no delivery would be given or asked for, but that the contracts would be settled by payments of difference, and that transactions were to commence in November 1939. Further he alleges that Jaganath Das Jain, defendant 3, was attached to his office and was friendly with the first two defendants and the broker, Basant Lal Masudi, that all three defendants in collusion with the broker without the knowledge or consent of the plaintiff, brought into existence the contract of 24th November 1939, between the plaintiffs on the one side and the Howrah Trading Co. Ltd., and the Naskarpara Jute Mills Co. Ltd., on the other. Then he goes on to allege that at the time Jaganath Das Jain entered into that contract, and throughout, the parties never intended that anything more than differences should be paid, and that the transaction was a wagering transaction and had not been consciously ratified by the plaintiff.

3. Further, he alleges that he resides and has his head office in Arrah where defendant 3, Jaganath Das Jain, has his residence, and the alleged head agreement, namely the agreement alleged to have been made prior to the contract of 24th November 1989, was made within the jurisdiction of the Arrah Court. The plaintiffs in the present suit, the Naskarpara Jute Mills Co. Ltd., therefore allege that their suit in this Court is more comprehensive than the suit filed at Arrah, and ask for an injunction restraining the defendant, Nirmal Kumar Jain, from proceeding with the Arrah suit. The defendant has not filed any affidavit in opposition to this petition, but there is another petition before me, filed by the defendant, Nirmal Kumar Jain, in the present suit in which he asks for stay of this suit on the ground that the Arrah suit is more comprehensive and that the matters in issue in the two suits are the same. On his behalf reference has been made to Section 10, Civil P. C, and the point has again been raised that this Court has no jurisdiction to issue an injunction restraining the defendant in a suit before this Court from proceeding with a suit in another Court if the provisions of Section 10 apply. I need only draw attention to my own judgment in the case in A. Milton & Co. v. Ojha Automobile Engineering Co : AIR1931Cal279 , following the decision of Sale J., in Mungle Chand v. Gopal Ram ('07) 34 Cal 101 which has been repeatedly followed in this Court and which, as the learned Judge states in his judgment, was in accordance with the view held by Judges of this Court for a long series of years. On p. 108 he says:

This Court has acted for a long series of years on the view that its powers of control over persons within its jurisdiction, by injunctions operating in personam, are not restricted by the provisions of the Civil Procedure Code, and I think it is too late to ask us to depart from its practice.

4. Similarly, in the case in Durgaprasad v. Kantichandra Mukherji : AIR1935Cal1 , it was held that the Court has jurisdiction to restrain a defendant from litigating in another Court on the ground of convenience. Panckridge J. said in that case at p. 693:

Having regard to the various authorities to which reference has been made, I think it must be conceded that the Court has jurisdiction to restrain a defendant from litigating in another Court on the grounds of convenience.

5. The cases to which he referred were those which I have mentioned and, in addition, the case of Mulchand Raichand v. Gill & Co ('20) 7 AIR 1920 Bom 296. Apart from these considerations, Section 10 only applies and forbids the Court from proceeding with the trial of any suit where the matter in issue is also directly and substantially in issue in a previously instituted suit between the same parties. It is true that the Arrah suit was instituted before the Bihar suit, but the parties are not the same, nor are the matters in issue, nor is the matter in suit in the Calcutta suit directly and substantially in issue in the Arrah suit. As stated in the judgment of Sir Ashutosh Mookherjee in the case in Bepin Behari v. Jogendra Chandra ('17) 4 AIR 1917 Cal 248:

The expression 'matter in issue' in Section 10, Civil P. C, has reference to the entire subject in controversy between the parties.

6. Now, in the first place, it is difficult to understand from the plaint in the Arrah suit what the plaintiff's case is. The plaint is confusing and contradictory. It is alleged that the plaintiff entered into an agreement to carry on gaming and wagering, but that it was with the three defendants, including Jaganath Das Jain. Then it is admitted that the contract of 24th November 1939 was 'brought into existence,' whatever that may mean, and that a contract between him and the first two defendants, namely the Howrah Trading Co. Ltd., and the Naskarpara Jute Mills Co. Ltd., was made to carry on by way of gaming and wagering, but in the same breath he alleges that defendant 3, namely Jaganath Das Jain, entered into the contracts and throughout the parties, which apparently included himself, never insisted that there should be any actual transfer of goods. Having said this, he goes on to allege that this contract was never consciously ratified by him, and though he states that what he calls the 'head agreement,' being the agreement to enter into gaming and wagering transactions, was made at Arrah, he does not deny-that the contract of 24th November 1939, was made in Calcutta through the agency of the broker acting on behalf of both parties. The issue raised in the Arrah suit, therefore, is confined to the question as to whether there was collusion and conspiracy between the three defendants, as alleged. It is obvious that a decision in the Arrah suit might not affect the issues which are raised in the Calcutta suit. For example, if the Arrah Court held that there was no conspiracy or collusion, there would still remain to be decided the question as to whether the sum claimed in the Calcutta suit was due to the plaintiff or not. In fact, strictly speaking, the Arrah Court, apart from the question of collusion and conspiracy, would have no jurisdiction to decide the question whether such a contract as that alleged on 24th November 1939, had been made or not, and certainly not whether the difference claimed by the plaintiff between the contract and the market price was due to the plaintiff or not. Apart from these considerations, it is clear to me that the balance of convenience is in favour of all these issues being decided in the Calcutta Court. The contract alleged on 24th November 1939 obviously depends upon witnesses who live in Calcutta and upon documents which are in the custody of persons in Calcutta.

7. The issue raised by the defendant as to conspiracy and collusion, must depend almost entirely on the evidence of the defendant alone, because it is hard to believe that he would seek to rely upon the evidence of Jaganath Das Jain who is alleged to be residing at Arrah, in support of the contention that Jaganath was a party to the conspiracy and collusion about which Nirmal Kumar Jain complains. Nor is he likely to rely upon the broker's evidence for similar reasons; and if he sought to do that, he also resides in Calcutta. I think it is obvious in this case that the Arrah suit was instituted with the object of defeating the arbitration proceedings which had been instituted before the Bengal Chamber of Commerce, and in such circumstances it is idle to say that the Court has no power to interfere or to see that justice is done between the parties. For these reasons the petition of the Naskarpara Jute Mills Co. Ltd., is allowed with costs, to the extent that an injunction is granted restraining the defendant from proceeding with, or taking any step in Title Suit No. 34 of 1940 in the Court of the first Subordinate Judge at Arrah, pending the final determination of this suit. The second petition, namely that of Nirmal Kumar Jain is dismissed with costs.


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