ORDER
1. Heard the arguments of learned Counsel on both sides.
2. This is plaintiffs’ revision against the order dated 7-4-1998 of the Trial Court in S.C. No. 4813 of 1993 directing return of the plaint to them for its presentation before the competent jurisdictional Court.
3. The said S.C. No. 4813 of 1993 was filed by the plaintiffs against respondents (hereinafter referred to as ‘defendants’) in the Court below at Bangalore for recovery of the sum of Rs. 19,467/- with interest at 12% per annum from them on the basis of Ex. P. 1 pro-note dated 25-4-1984 alleging that it was executed by them at Davangere City in favour of plaintiff 2 for the debt of Rs. 14,100/- agreeing to repay the same on demand with interest at 12% per annum and that they have failed to repay the said debt despite demand notice Ex. P. 3, dated 1-3-1996 which was got issued from Bangalore through plaintiffs’ Advocate, Defendants filed their written statement contesting the plaintiffs’ suit on the ground, inter alia, that Court below had no territorial jurisdiction to try the suit.
4. At the trial plaintiff 2 was examined as P.W. 1 and the documents at Exs. P. 1 to P. 5 were produced by him in proof of the suit claim. No evidence as such was let in on record from defendants’ side. The Trial Court then proceeded to formulate the following material points for its decision and has answered them as indicated below on the basis of the admissible material on record.
Points :
Findings :
“1. Whether this Court has no
jurisdiction to try this case in view of para 6 of the written statement.
Ans: In affirmative;
2. Whether the plaintiff proves that the
defendants 1 and 2 have executed a suit pro-note for the value received.
Ans: Does not
arise;
3. Whether the unit as brought is barred by limitation.
Ans: Does not
arise;
4. Whether the suit document that is the
pro-note is insufficiently stamped.
Ans: Does not
arise;
5. Whether the plaintiffs prove that the
defendants are liable to pay a gum of Rs. 19,467/- together with interest at
12% p.a. as prayed.
Ans: As per the final order for the reasons”.
5. The affirmative finding on Point No. 1 was recorded by the Trial Court holding that in view of the admitted fact that Ex. P. 1 suit pro-note was executed at Davanagere City where the defendants were also residing, the cause of action for the suit had arisen in the territorial limit of the Competent Civil Court at Davanagere only and, therefore, the Court below at Bangalore had no jurisdiction to entertain and try the suit. As a result of this finding other points were not taken up by it for consideration, and the impugned order has been passed by it directing return of the plaint to the plaintiffs for its presentation in proper Court.
6. The legality and correctness of the Trial Court’s affirmative finding on material point No. 1 was seriously challenged by the Learned Counsel for petitioners-plaintiffs, Mr. Nanjundaswamy. His submission was that there was a specific clause incorporated in Ex. P. 1 pro-note with a stipulation that the demand for repayment of debt thereunder could be made by the plaintiff at any time and at any place and that the defendants were agreeable to meet the demand at whichever place it was made by the plaintiff. He submitted that the plaintiff-promisee having made demand for payment of debt at Bangalore, this demand also gave rise to the cause of action for the suit in part at Bangalore. Reliance was also placed by him on a precedent of the erstwhile Bombay High Court laid down in his Division Bench decision in Chunilal Mayachand v E.E. Millard. Drawing upon this term in Ex. P. 1 he sought to seek shelter under sub-clause (c) of Section 20 of the CPC.
7. Learned Counsel for respondents, Mr. Deshpande, argued otherwise in support of the validity of the impugned order of the Court below
but he was fair enough in his submission that he was not able to lay his hand on any situation laying down the legal proposition striking a divergent view from the one which was held by the High Court of Bombay in the case of Chunilal, supra.
8. The material portion of the suit pro-note Ex. P. 1 is as extracted below:
9. The underlined portion of the above extracted matter of Ex. P. 1 pro-note undoubtedly makes it clear that the right for the promisee-plaintiff was reserved thereunder to put forth his demand from any place of his choice for repayment of the debt and now. it is the definite case of the plaintiff that original of Ex, P. 3 demand notice dated 1-3-1986 was got issued to defendants from Bangalore through his Advocate and therefore by this demand the cause of action has also arisen at Bangalore.
The relevant sub-clause (c) of Section 20 of the CPC and its material portion read:
“20. Other suits to be instituted where defendants reside or cause of action arise.–Subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction-
(a)xxx xxx xxx xxx. (b)xxx xxx xxx xxx. the cause of action, wholly or in part, arises. Explanation.-- xxx".
10. The original of Ex. P. 3 demand notice was got issued to defendant from Bangalore by the plaintiffs through their Advocate and, therefore, the cause of action also arose at Bangalore. The decision of Division Bench of erstwhile Bombay High Court, supra, is directly on the point whether in view of presence of the clause in a on-demand pro-note as the one contained in the case in hand, the cause of action for the plaintiff to file the suit would be held to have arisen at the place where the demand for repayment of the debt under the pro-note was made as against the promisor-defendant. In that case of Chunilal Mayachand, supra, also the pro-note contained a similar clause excerpted below;
“Money payable either in Poona, Bombay or elsewhere”.
His Lordship Beaumont, C.J. of Bombay High Court speaking for the Bench, after discussion of the legal consequences of such a clause, concluded:
“Moreover the place of payment specified in the note being Poona, Bombay or elsewhere, the stipulation as to place really amounts to nothing at all, since it provides that the promissory notice is payable anywhere- So that we have to deal with a promissory note payable on demand at any place….. that since the creditor has demanded payment in Bombay, that fixes the place of payment and makes it unnecessary for the promisor to apply to the promisee to fix a place for payment under Section 49, Contract Act. In my opinion in this case the moneys are payable in Bombay and that being so, the cause of action or part of the cause of action arose in Bombay and leave under Clause 12 of the Letters Patent should be granted”.
The enunciation of law by Lordship, as quoted above, was concurred by the Benchmate Blackwell, J., in the following words:
“I also am of opinion that in the case of a demand promissory note such as that before us in this case the option rests with the creditor and not with the debtor as to the place of payment. Having regard to the terms of the note, it was clearly, in my opinion, payable anywhere and there was an option with the creditor to make a demand upon the debtor to pay him at such place as he choose. . . . That being so, I think that the cause of action thereupon arose in Bombay and this Court has jurisdiction”.
11. Therefore, in the case on hand also the demand for payment having been made by the plaintiff in Bangalore through Ex. P. 3 demand notice in exercise of the right reserved for him under Ex. P. 1 pro-note the cause of action for the suit based thereon had arisen in part in Bangalore and within the jurisdiction of the Court below in the light of sub-section (c) of Section 20 of the CPC.
12. Hence, the impugned order of the Trial Court taking a contrary view is unsustainable and the same is liable to be set aside,
13. However, I feel constrained to observe in the ends of justice that when any such clause as the one stated above is contained in any suit pro-note and invoking the aid of that clause if the promisee or the holder of the pro-note chooses to initiate legal action and file a suit against the promisor-defendant to enforce the claim thereunder in a Court situate at a place other than the one where the suit pro-note was executed or defendant resides, in all probability, it will work out great hardship on the defendant to appear before the Trial Court from his place and contest the plaintiffs suit. In such a situation, depending upon peculiar facts and circumstances, it is ordinarily just and proper for the Trial Court to impose cost on the plaintiff which is sufficient to defray the defendant’s expenditure which he would be likely to incur in defence of the suit.
14. For the reasons aforesaid, the revision is allowed, The impugned order dated 7-4-1988 of the Court below is set aside and the matter is remitted to it with a direction to proceed with the disposal of the suit on its merits according to law and in the light of the observation made above.
Parties to bear their own costs.