{"id":67579,"date":"1994-06-23T00:00:00","date_gmt":"1994-06-22T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/oil-natural-gas-commission-vs-utpal-kumar-basu-on-23-june-1994"},"modified":"2016-01-03T12:17:57","modified_gmt":"2016-01-03T06:47:57","slug":"oil-natural-gas-commission-vs-utpal-kumar-basu-on-23-june-1994","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/oil-natural-gas-commission-vs-utpal-kumar-basu-on-23-june-1994","title":{"rendered":"Oil & Natural Gas Commission vs Utpal Kumar Basu on 23 June, 1994"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Oil & Natural Gas Commission vs Utpal Kumar Basu on 23 June, 1994<\/div>\n
Equivalent citations: 1994 SCC (4) 711, \t JT 1994 (5)\t 1<\/div>\n
Author: Ahmadi<\/div>\n
Bench: Ahmadi, A.M. (J)<\/div>\n
           PETITIONER:\nOIL & NATURAL GAS  COMMISSION\n\n\tVs.\n\nRESPONDENT:\nUTPAL KUMAR BASU\n\nDATE OF JUDGMENT23\/06\/1994\n\nBENCH:\nAHMADI, A.M. (J)\nBENCH:\nAHMADI, A.M. (J)\nVENKATACHALLIAH, M.N.(CJ)\nJEEVAN REDDY, B.P. (J)\n\nCITATION:\n 1994 SCC  (4) 711\t  JT 1994 (5)\t  1\n 1994 SCALE  (3)90\n\n\nACT:\n\n\n\nHEADNOTE:\n\n\n\nJUDGMENT:\n<\/pre>\n
The Judgment of the Court was delivered by
\nA.M.  AHMADI, J.- The short question to which we propose  to
\nlimit ourselves in this appeal directed against the decision
\nrendered by Shyamal Kumar Sen, J. of the Calcutta High Court
\non  17-12-1993 in Writ Petition No. 487 of 1993, is  whether
\nany part of the cause of action for filing the petition\t had
\narisen\twithin\tthe jurisdiction of the said High  Court  to
\nentitle it to entertain, hear and decide the said  petition?
\nThe factual background in which the question of\t territorial
\njurisdiction arises may be noticed briefly.\n<\/p>\n
2.The Oil and Natural Gas Commission (ONGC), a Government of
\nIndia  Undertaking, has a Gas Processing Plant at Hazira  in
\nthe State of Gujarat.  Engineers India Limited (EIL)  acting
\nas consultants for ONGC issued an advertisement dated  27-6-
\n1991  in  the leading newspapers of  the  country  including
\nthose in circulation in West Bengal calling for tenders\t for
\nsetting\t up  of a Kerosene Recovery Processing Unit  at\t the
\nHazira\t Complex   in  Gujarat.\t  According  to\t  the\tsaid
\nadvertisement  the  tenders  containing offers\twere  to  be
\ncommunicated  to  EIL  at  New\tDelhi.\t NICCO,\t having\t its
\nregistered office in Calcutta, read and became aware of\t the
\ntender notice printed in the
\n 715<\/span>
\nTimes  of  India circulated within the jurisdiction  of\t the
\nCalcutta High Court.  The tenders were to be scrutinised  by
\na Tender Committee and the final decision was to be taken by
\na  Steering  Committee\tat New Delhi presided  over  by\t the
\nChairman of ONGC.  NICCO, along with others, submitted their
\noffer or bid in response to the tender notice.\tAll the bids
\nwere  scrutinised  by  EIL at New Delhi.   NICCO’s  bid\t was
\nrejected on the ground that it did not fulfil the  requisite
\nexperience   criteria\tstipulated  in\tthe   tender.\t The
\nrecommendations\t made  by  the EIL were\t considered  by\t the
\nTender Committee.  The Tender Committee, however,  expressed
\nthe  view that NICCO satisfied the experience  criteria\t and
\nthey  too  should be called for\t the  clarificatory  meeting
\nproposed  to be held by EIL at New Delhi.  The said  meeting
\nwas  held  by the EIL with various bidders  including  NICCO
\nsome  time in July-August 1992.\t After the said meeting\t EIL
\nonce again reiterated its earlier view that NICCO lacked the
\nexperience  criteria.  The Tender Committee re-examined\t the
\nview  of EIL and agreed with the same some time\t in  October
\n1992.\tIn  view  of  the said\tdevelopment  NICCO  was\t not
\nrecommended for shortlisting by the Tender Committee.  NICCO
\nrepresented and their representations were considered by the
\nEIL  as well as the Tender Committee but they saw no  reason
\nto  depart from their earlier view.  The final decision\t was
\ntaken  by the Steering Committee on 27-1-1993 at New  Delhi,
\npursuant whereto it was decided to award the contract to M\/s
\nCIMMCO\tLtd.   Thereupon  NICCO\t filed\tthe  aforesaid\twrit
\npetition  in the High Court of Calcutta.  In the  said\twrit
\npetition CIMMCO was not made a party.  On the application of
\nCIMMCO\tthis Court directed that it be joined in the  appeal
\nas  a co-respondent.  NICCO prayed that ONGC  be  restrained
\nfrom awarding the contract to any other party and if awarded
\nto  cancel the same.  The High Court by its  impugned  order
\ndated 17-12-1993 directed as under:\n<\/p>\n
\t      “There   will  be\t an  order   directing\t the
\n\t      respondents  to  consider\t the  offer  of\t the
\n\t      petitioner  along with the others and  in\t the
\n\t      event  the  petitioner’s\toffer  is  otherwise
\n\t      found to be valid and lowest and in the  event
\n\t      petitioner   otherwise   complies\t  with\t the
\n\t      formalities,  petitioner’s  offer\t should\t  be
\n\t      accepted by the respondent authorities.
\n\t      The writ petition is accordingly disposed of.”\n<\/p><\/blockquote>\n
All the parties to the writ petition were directed to act in
\naccordance  with the signed copy of the aforesaid  operative
\npart  of the order.  A detailed judgment giving reasons\t for
\nthe aforesaid operative part of the order was later rendered
\non 4-2-1994.\n<\/p>\n
3.Aggrieved  by the judgment and order of the High  Court
\nin the aforesaid writ petition, ONGC moved this Court  under
\nArticle 136 of the Constitution of India.  This Court by its
\norder  dated  31-1-1994\t granted an  ad\t interim  order\t for
\nmaintenance of status quo.  Thereafter on 25-2-1994 leave to
\nappeal\twas granted and the status quo order was  continued.
\nAs stated earlier by the said order CIMMCO was impleaded  as
\na party-respondent.\n<\/p>\n
4.At  the hearing of this appeal we indicated to  counsel
\nthat  we would like to confine ourselves to the\t preliminary
\nobjection  of  ONGC that the High Court of Calcutta  had  no
\njurisdiction to entertain, hear and dispose of the
\n716<\/span>
\nwrit  petition in the manner it did as the averments in\t the
\nwrit  petition,\t even  if assumed to  be  correct,  did\t not
\ndisclose  that\teven  a\t part of the  cause  of\t action\t for
\ninstitution of the said writ petition had arisen within\t the
\njurisdiction   of  the\tCalcutta  High\tCourt.\t  The\twrit
\npetitioners  averred  in paragraph 43 of the  writ  petition
\nthat  a\t part of the cause of action had arisen\t within\t the
\njurisdiction of the said High Court as pleaded in paragraphs
\n5,  7,\t18, 22 and 26 of the writ  petition.   They  further
\naverred\t in  the  said paragraph that they  were  likely  to
\nsuffer\t a  loss  at  its  registered  office\twithin\t the
\njurisdiction of the Calcutta High Court if the contract\t was
\nnot awarded to them.  The averments in paragraphs 5, 7,\t 18,
\n22 and 26 in a nutshell are as under:\n<\/p>\n
\t      Para 5. NICCO came to know of the tender\tfrom
\n\t      the publication in the Times of India  ‘issued
\n\t      and   obtained’  by  NICCO  within  the\tsaid
\n\t      jurisdiction;\n<\/p><\/blockquote>\n
\t      Para  7. NICCO issued\/submitted its tender  on
\n\t      19-8-1991\t from its registered  office  within
\n\t      the  Jurisdiction of the Calcutta\t High  Court
\n\t      which was received by EIL at New Delhi;
\n\t      Para  18.\t NICCO submitted its  revised  price
\n\t      bid by letter dated 3-12-1992 issued from\t its
\n\t      registered   office   within   the   aforesaid
\n\t      jurisdiction;\n<\/p><\/blockquote>\n
\t      Para  22.\t  By communication  dated  4-12-1992
\n\t      issued from its registered office, NICCO\tmade
\n\t      demands  for justice to  various\tauthorities;
\n\t      and
\n\t      Para  26.\t By letters addressed  to  different
\n\t      agencies\tincluding the Steering Committee  of
\n\t      ONGC   in\t January\/February  1993\t  from\t its
\n\t      registered  office,  NICCO  made\tdemands\t for
\n\t      justice.\n<\/p><\/blockquote>\n
These are the averments in the body of the writ petition  on
\nthe  basis whereof NICCO contended that a part of the  cause
\nof action had arisen within the jurisdiction of the Calcutta
\nHigh Court.  It may also be mentioned that in the course  of
\nsubmissions before this Court counsel for NICCO referred  to
\na fax message dated 15-1-1993 sent in answer to NICCO’s\t fax
\nmessage\t dated 11-1-1993 on the basis of which he  contended
\nthat  a\t part  of  the cause  of  action  arose\t within\t the
\njurisdiction  of the Calcutta High Court where\tthe  message
\nwas  received.\t Although in the paragraphs  disclosing\t the
\ncause  of  action for the institution of the  writ  petition
\nreference  is  not made to this fax message, we\t propose  to
\ndeal  with it to avoid technicalities.\tThe question  which,
\ntherefore, arises for consideration is whether the aforesaid
\naverments  made\t in  the body of  the  writ  petition  taken
\nindividually  or  collectively, assuming them  to  be  true,
\nconstitute a cause of action for the maintenance of the writ
\npetition in the High Court of Calcutta?\n<\/p>\n
5.Clause  (1) of Article 226 begins with a  non\t obstante
\nclause notwithstanding anything in Article 32 – and provides
\nthat  every  High  Court shall have  power  “throughout\t the
\nterritories in relation to which it exercises jurisdiction”,
\nto   issue  to\tany  person  or\t authority,   including\t  in
\nappropriate    cases,\tany   Government,   “within    those
\nterritories”   directions,   orders  or\t  writs,   for\t the
\nenforcement  of any of the rights conferred by Part  III  or
\nfor any other purpose.\tUnder clause (2) of Article 226\t the
\nHigh Court may
\n 717<\/span>
\nexercise  its power conferred by clause (1) if the cause  of
\naction,\t wholly or in part, had arisen within the  territory
\nover  which it exercises Jurisdiction, notwithstanding\tthat
\nthe seat of such Government or authority or the residence of
\nsuch  person  is not within those territories.\tOn  a  plain
\nreading\t of the aforesaid two clauses of Article 226 of\t the
\nConstitution it becomes clear that a High Court can exercise
\nthe  power  to\tissue directions, orders or  writs  for\t the
\nenforcement  of any of the fundamental rights  conferred  by
\nPart III of the Constitution or for any other purpose if the
\ncause  of  action, wholly or impart, had arisen\t within\t the
\nterritories in relation to which it exercises  jurisdiction,
\nnotwithstanding that the seat of the Government or authority
\nor  the residence of the person against whom the  direction,
\norder or writ ‘is issued is not within the said territories.
\nIn  order  to  confer  jurisdiction on\tthe  High  Court  of
\nCalcutta, NICCO must show that at least a part of the  cause
\nof action had arisen within the territorial jurisdiction  of
\nthat Court, That is at\t best its case in the writ petition.\n<\/p>\n
6. It is well settled that the expression “cause of  action”
\nmeans that bundle of facts which the petitioner must  prove,
\nif traversed, to entitle him to a judgment in his favour  by
\nthe Court.  In Chand Kour v. Partab Singh’ Lord Watson said:\n<\/p>\n
\t      “…  the\t cause\tof action  has\tno  relation
\n\t      whatever to the defence which  may  be set  up
\n\t      by the defendant, nor does it depend upon\t the
\n\t      character\t of  the relief prayed\tfor  by\t the
\n\t      plaintiff.   It refers entirely to the  ground
\n\t      set  forth  in  the plaint  as  the  cause  of
\n\t      action, or, in other words, to the media\tupon
\n\t      which  the plaintiff asks the Court to  arrive
\n\t      at a conclusion in his favour.”\n<\/p><\/blockquote>\n
Therefore,   in\t determining  the  objection  of   lack\t  of
\nterritorial  jurisdiction the court must take all the  facts
\npleaded in support of the cause of action into consideration
\nalbeit\t without  embarking  upon  an  enquiry\tas  to\t the
\ncorrectness or otherwise of the said facts.  In other  words
\nthe   question\t whether  a  High  Court   has\t territorial
\njurisdiction  to entertain a writ petition must be  answered
\non  the\t basis of the averments made in\t the  petition,\t the
\ntruth  or  otherwise whereof being immaterial.\t To  put  it
\ndifferently, the question of territorial     jurisdiction
\nmust  be  decided  on the facts\t pleaded  in  the  petition.
\nTherefore,  the\t question whether in the  instant  case\t the
\nCalcutta High Court had jurisdiction to entertain and decide
\nthe writ petition in question even on the facts alleged must
\ndepend\tupon whether the averments made in paragraphs 5,  7,
\n18, 22, 26 and 43 are sufficient in law to establish that  a
\npart   of  the\tcause  of  action  had\tarisen\twithin\t the
\njurisdiction of the Calcutta High Court.\n<\/p>\n
7.  The\t learned counsel for ONGC contended  that  on  these
\naverments  no part of the cause of action had arisen  within
\nthe  jurisdiction of the Calcutta High Court and  hence\t the
\nwrit   petition\t  filed\t by  NICCO  and\t another   was\t not
\nentertainable  by that High Court.  He submitted  that\tONGC
\nhad decided to set up a Kerosene Recovery Processing Unit at
\nHazira\tin  Gujarat.   EIL  was appointed  by  ONGC  as\t its
\nconsultant.  In that capacity, EIL issued the  advertisement
\nfrom  New Delhi calling for tenders and\t this  advertisement
\nwas
\n1  ILR (1889) 16 Cal 98,102: 15 IA 156
\n718<\/span>
\nprinted\t and published in all the leading newspapers of\t the
\ncountry including the Times of India in circulation in\tWest
\nBengal.\t The tenders or bids were to be forwarded to EIL  at
\nNew  Delhi.  EIL was expected to scrutinise the tenders\t and
\nmake its recommendations to the Tender Committee constituted
\nby  ONGC.  The final decision was, however, to be  taken  by
\nthe  Steering  Committee at New Delhi presided over  by\t the
\nChairman,  ONGC.   Accordingly,\t the  tender  of  NICCO\t was
\nexamined  by  EIL  at  New  Delhi  and\tit  recommended\t its
\nrejection  on  the  ground that NICCO did  not\tsatisfy\t the
\nexperience criteria requisite for the grant of contract.  On
\nthe first occasion, the Tender Committee did not agree\twith
\nthe  said recommendation and directed the EIL to call  NICCO
\nat  the\t clarificatory meeting proposed to be  held  in\t New
\nDelhi.\t In  obedience to the said  direction,\tEIL  invited
\nNICCO\talong  with  the  other\t bidders,  but\tonce   again
\nrecommended  its  rejection on the ground that\tit  did\t not
\nsatisfy the experience criteria.  The Tender Committee which
\nmet in New Delhi reviewed its earlier decision and  accepted
\nthe  recommendation  of EIL which was also accepted  by\t the
\nSteering  Committee  at New Delhi on 27-1-1993.\t It  was  at
\nthis  point of time that the decision to award the  contract
\nto  CIMMCO  was\t taken\tat New\tDelhi.\t Counsel  for  ONGC,
\ntherefore,  contended  that  all  these\t events\t took  place
\noutside\t the  jurisdiction of the Calcutta  High  Court\t and
\nmerely because NICCO had read the advertisement in the Times
\nof India in circulation in West Bengal and had forwarded its
\ntender\tfrom its registered office in Calcutta and  followed
\nit up by a revised offer, it cannot be said that any part of
\nthe  cause of action had arisen within the  jurisdiction  of
\nthe Calcutta High Court for the simple reason that if  these
\nfacts  were to give a cause of action, every tenderer  would
\nsue  ONGC  in the local court from where  he  forwarded\t the
\ntender\tand  that would make ONGC run about  from  court  to
\ncourt all over the country.  Counsel further submitted\tthat
\nnor  can the fact that NLCCO sent representations  including
\nfax messages from its registered office to ONGC at  Calcutta
\nto  which  ONGC\t showed\t the  courtesy\tof  replying  confer
\njurisdiction.\tIn  support of this  contention,  he  placed
\nstrong\treliance  on the decision in State of  Rajasthan  v.
\nSwaika\tProperties2.  Learned<\/a> counsel for CIMMCO  buttressed
\nthese submissions by inviting our attention to certain other
\ndecisions of this Court, namely, Election Commission v. Saka
\nVenkata Subba Rao3, R. Bejal<\/a> v. Triveni Structurals Ltd\t .4,
\nSubodh Kumar Gupta v. Shrikant Gupta’ and<\/a> certain  decisions
\nof  different High Courts.  On the other hand,\tcounsel\t for
\nNICCO,\t while\treiterating  that  the\taverments  made\t  in
\nparagraphs 5, 7, 18, 22 and 26 constituted an integral\tpart
\nof  the cause of action, submitted that by the\tintroduction
\nof  clause  (2)\t in Article 226\t of  the  Constitution,\t the
\nLegislature intended,to widen the High Court’s\tJurisdiction
\nand thereby extend its beneficent reach even to cases  where
\na  part of the cause of action arose within its\t territorial
\nJurisdiction.  In the alternative, he submitted that even if
\nthis Court comes to the conclusion that the High Court
\n2 (1985) 3 SCC 217
\n3    1953 SCR 1144: AIR 1953 SC 210
\n4    1987 Supp SCC 279
\n5  (1993) 4 SCC 1
\n 719<\/span>
\nof  Calcutta  lacked  jurisdiction, this  Court\t sitting  in
\nappeal\tshould\tnot interfere with the verdict of  the\tHigh
\nCourt as ONGC had neither alleged nor showed that there\t had
\nbeen  a failure of justice.  In this connection,  he  placed
\nreliance  on the spirit of Section 21 of the Code  of  Civil
\nProcedure.  He, therefore, contended that this Court  should
\nexamine\t the appeal on merits and not confine itself to\t the
\nquestion of territorial jurisdiction.  Lastly, he  submitted
\nthat on merits NICCO had made out a good case for the  grant
\nof relief sought by it.\n<\/p>\n
8.From\tthe  facts pleaded in the writ\tpetition,  it  is
\nclear  that NICCO invoked the jurisdiction of  the  Calcutta
\nHigh  Court on the plea that a part of the cause  of  action
\nhad  arisen within its territorial jurisdiction.   According
\nto  NICCO,  it became aware of the contract proposed  to  be
\ngiven by ONGC on reading the advertisement which appeared in
\nthe  Times  of India at Calcutta.  In response\tthereto,  it
\nsubmitted  its\tbid or tender from its Calcutta\t office\t and
\nrevised the rates subsequently.\t When it learnt that it\t was
\nconsidered ineligible it sent representations, including fax
\nmessages,  to  EIL,  ONGC, etc.,  at  New  Delhi,  demanding
\njustice.  As stated earlier, the Steering Committee  finally
\nrejected  the  offer of NICCO and awarded  the\tcontract  to
\nCIMMCO\tat  New\t Delhi\ton  27-1-1993.\t Therefore,  broadly
\nspeaking,  NICCO claims that a part of the cause  of  action
\narose  within  the jurisdiction of the Calcutta\t High  Court
\nbecause it became aware of the advertisement in Calcutta, it
\nsubmitted   its\t bid  or  tender  from\tCalcutta  and\tmade
\nrepresentations demanding justice from Calcutta on  learning
\nabout the rejection of its offer.  The advertisement  itself
\nmentioned that the tenders should be submitted to EIL at New
\nDelhi; that those would be scrutinised at New Delhi and that
\na final decision whether or not to award the contract to the
\ntenderer  would\t be  taken at New  Delhi.   Of\tcourse,\t the
\nexecution  of  the contract work was to be  carried  out  at
\nHazira\tin Gujarat.  Therefore, merely because it  read\t the
\nadvertisement  at  Calcutta  and submitted  the\t offer\tfrom
\nCalcutta  and made representations from Calcutta would\tnot,
\nin our opinion, constitute facts forming an integral part of
\nthe cause of action.  So also the mere fact that it sent fax
\nmessages  from\tCalcutta  and received a  reply\t thereto  at
\nCalcutta would not constitute an integral part of the  cause
\nof action.  Besides the fax message of 15-1-1993, cannot  be
\nconstrued  as conveying rejection of the offer as that\tfact
\noccurred  on 27-1-1993.\t We are, therefore, of\tthe  opinion
\nthat even if the averments in the writ petition are taken as
\ntrue,  it cannot be said that a part of the cause of  action
\narose within the jurisdiction of the Calcutta High Court.\n<\/p>\n
9.In Subodh Kumar Gupta case5, the facts revealed that he
\nhad  instituted\t a  suit  in  the  Court  of  Senior  Judge,
\nChandigarh,  for  dissolution  of the firm in  which  he  as
\npartner\t had 20% share along with his father,  brothers\t and
\none  another.\tThe head office of the firm was\t situate  in
\nBombay\twhere the firm was registered with the Registrar  of
\nFirms.\tIts factory was situate at Mandsaur where the father
\nRajaram\t Gupta\tlived  with his sons  and  attended  to\t the
\npartnership  business.\t The plaintiff-petitioner  was\talso
\nresiding   in  Mandsaur\t till  1974  when  he\tshifted\t  to
\nChandigarh.    He,  however,  visited  Mandsaur\t  often\t  in
\nconnection with the business of the firm.  The case
\n720<\/span>
\npleaded\t by him was that after he shifted to Chandigarh,  he
\nused to call for and received the statements of accounts  of
\nthe business carried on at Mandsaur.  He had got letterheads
\nprinted indicating that the branch office of the firm was at
\nChandigarh and he claimed that he also booked orders for the
\nfirm  at  Chandigarh.\tIt was\talso  pleaded  that  certain
\ndisputes   had\tarisen\tregarding  the\tmanagement  of\t the
\npartnership  firm  and in regard to the correctness  of\t the
\naccounts  which were discussed at the meeting in  Bhilai  at
\nthe   end  whereof  an\tagreement  was\tdrawn  up  for\t the
\ndissolution  of\t the  partnership and  for  distribution  of
\nassets\tamongst\t the partners to which the plaintiff  was  a
\nsignatory.   The  suit\tfiled in the  Chandigarh  court\t was
\nresisted  on the preliminary contention that no part of\t the
\ncause of action had arisen at Chandigarh and therefore\tthat
\ncourt had no jurisdiction.  The Chandigarh court upheld\t the
\ncontention  and\t this Court affirmed the said  view.   While
\ndealing with the averment that the plaintiff was carrying on
\nbusiness of the firm from Chandigarh where the branch office
\nof  the firm was situate, this Court held that there  is  no
\naverment that the branch at Chandigarh was started with\t the
\nconsent\t of  the other partners and intimation\tthereof\t was
\ngiven to the Registrar of Firms as required by Section 61 of
\nthe  Partnership  Act; the mere printing of  stationery\t was
\nneither here nor there and therefore no part of the cause of
\naction\tcould be said to have arisen within the\t territorial
\njurisdiction of the Chandigarh court.\n<\/p>\n
10.  The  submission  of the learned counsel for  NICCO\t was
\nthat clause (2)\t    was\t introduced  in Article 226  of\t the
\nConstitution  to enlarge the scope of the writ\tjurisdiction
\nof the High Court.  The Supreme Court in Saka Venkata  Subba
\nRao  case3 while interpreting Article 226 as it\t then  stood
\nobserved as under:\n<\/p>\n
\t      “The  rule  that\tcause  of  action   attracts
\n\t      Jurisdiction  in suits is based  on  statutory
\n\t      enactment\t and cannot apply to writs  issuable
\n\t      under Article 226 which makes no reference  to
\n\t      any  cause  of action or where it\t arises\t but
\n\t      insists  on  the\tpresence of  the  person  or
\n\t      authority ‘within the territories’ in relation
\n\t      to    which   the\t  High\t  Court\t   exercises
\n\t      jurisdiction.”\n<\/p><\/blockquote>\n
Thus,  this  Court ruled that in the absence of\t a  specific
\nprovision  in Article 226 on the lines of the Code of  Civil
\nProcedure,  the High Court cannot exercise  jurisdiction  on
\nthe  plea that the whole or part of the cause of action\t had
\narisen\twithin its jurisdiction.  This view was followed  in
\nsubsequent  cases.  The consequence was that only  the\tHigh
\nCourt  of Punjab could exercise jurisdiction  under  Article
\n226 of the Constitution against the Union of India and other
\nbodies\tlocated in Delhi.  To remedy this situation,  clause
\n(1-A)  was  inserted  by the 15th Amendment  Act,  1963,  to
\nconfer\ton  the\t High Courts  jurisdiction  to\tentertain  a
\npetition under Article 226 against the Union of India or any
\nother  body  or authority located in Delhi if the  cause  of
\naction\t has   arisen,\twholly\tor  in\tpart,\twithin\t its
\nJurisdiction.\tClause (1-A) was later renumbered as  clause
\n(2)  of\t Article 226.  Therefore, the  learned\tcounsel\t for
\nNICCO  is  right  that\tthis  amendment\t was  introduced  to
\nsupersede  the\tview taken by this Court  in  the  aforesaid
\ncase.\tBut as stated earlier, on a plain reading of  clause
\n(2) of Article 226, it is clear that the power conferred by
\n 721<\/span>
\nclause\t(1) can be exercised by the High Court provided\t the
\ncause  of action, wholly or in part, had arisen\t within\t its
\nterritorial limits.\n<\/p>\n
11.Strong  reliance  was placed on the\tdecision  of  this
\nCourt in the State of Rajasthan case2 by the learned counsel
\nfor   ONGC.   The  facts  of  that  case  reveal  that\t the
\nrespondent-company having its registered office at  Calcutta
\nowned a large chunk of land on the outskirts of Jaipur.\t The
\nSpecial\t Officer, Town Planning Department, Jaipur,  at\t the
\ninstance  of the Improvement Trust, Jaipur issued  a  notice
\nintimating  that the State Government proposed to acquire  a
\nlarge part of the said parcel of land for a public  purpose,
\nnamely,\t implementation of a development scheme.   The\tsaid
\nnotice was duly served on the respondents at their  Calcutta
\noffice.\t  The  respondents thereafter  participated  in\t the
\ninquiry and contended that they proposed to use the land for
\nconstructing  a\t three\tstar hotel.   The  Special  Officer,
\nhowever,  felt that the alleged need of the respondents\t was
\njust  a\t pretence and the land was not needed bona  fide  by
\nthem, but the real object was to get the land released\tfrom
\nacquisition.  Consequently, the requisite final notification
\nfor  the acquisition of the land was issued.  Thereafter  an
\nattempt was made to seek exemption in regard to the notified
\nland  under  Section  20 of the\t Urban\tLands  (Ceiling\t and
\nRegulation)  Act, 1976, but in vain.  Having failed  to\t get
\nthe 1-and released from acquisition, the respondents filed a
\nwrit  petition under Article 226 of the Constitution in\t the
\nHigh  Court of Calcutta challenging the acquisition  wherein
\nrule nisi was issued and an ad interim ex parte\t prohibitory
\norder  was granted restraining taking of possession  of\t the
\nacquired   land,   etc.\t  The  question\t which\t arose\t for
\nconsideration in the backdrop of the said facts was  whether
\nthe High Court of Calcutta had jurisdiction to entertain the
\npetition  and grant ex parte ad interim relief.\t This  Court
\nobserved  that\tupon  the said facts, the  cause  of  action
\nneither\t wholly\t nor in part arose  within  the\t territorial
\nlimits of the Calcutta High Court and therefore the  learned
\nJudge had no jurisdiction to issue rule nisi or to grant the
\nad interim ex parte prohibitory order.\tAfter extracting the
\ndefinition of the expression “cause of action” from  Mulla’s
\nCode of Civil Procedure, this Court observed as under:\t(SCC
\np. 223, para 8)
\n\t      “The  mere  service of  notice  under  Section
\n\t      52(2)  of the Act on the respondents at  their
\n\t      registered  office  at 18-B,  Brabourne  Road,
\n\t      Calcutta i.e. within the territorial limits of
\n\t      the State of West Bengal, could not give\trise
\n\t      to  a  cause of action within  that  territory
\n\t      unless  the  service  of such  notice  was  an
\n\t      integral\tpart  of the cause of  action.\t The
\n\t      entire  cause  of action\tculminating  in\t the
\n\t      acquisition of the land under Section 52(1) of
\n\t      the  Act arose within the State  of  Rajasthan
\n\t      i.e.  within the territorial  jurisdiction  of
\n\t      the Rajasthan High Court at the Jaipur Bench.”\n<\/p>\n
12.Pointing   out   that  after\t the   issuance\t  of   the
\nnotification by the State Government under Section 52(1)  of
\nthe  Act,  the\tnotified land became  vested  in  the  State
\nGovernment  free from all encumbrances and hence it was\t not
\nnecessary for the respondents to plead the service of notice
\nunder  Section\t52(2)  for  the\t grant\tof  an\t appropriate
\ndirection  or  order  under Article  226  for  quashing\t the
\nnotification  acquiring\t the land.  This  Court,  therefore,
\nheld that
\n722<\/span>
\nno part of the cause of action arose within the jurisdiction
\nof the Calcutta High Court.  This Court deeply regretted and
\ndeprecated  the\t practice  prevalent in the  High  Court  of
\nexercising jurisdiction and passing interlocutory orders  in
\nmatters\t  where\t  it   lacked\tterritorial    jurisdiction.
\nNotwithstanding\t the strong observations made by this  Court
\nin  the\t aforesaid  decision and in  the  earlier  decisions
\nreferred  to therein, we are distressed that the High  Court
\nof  Calcutta  persists in exercising  jurisdiction  even  in
\ncases where no part of the cause of action arose within\t its
\nterritorial  jurisdiction.  It is indeed a great  pity\tthat
\none of the premier High Courts of the country should  appear
\nto  have developed a tendency to assume jurisdiction on\t the
\nsole  ground  that the petitioner before it  resides  in  or
\ncarries on business from a registered office in the State of
\nWest   Bengal.\t  We   feel  all  the\tmore   pained\tthat
\nnotwithstanding\t the  observations of Court  made  time\t and
\nagain,\tsome of the learned Judges continue to\tbetray\tthat
\ntendency.  Only recently while disposing of appeals  arising
\nout of SLP Nos. 10065-66 of 1993, Aligarh Muslim  University
\nv,  Vina.v  Engineering Enterprises (P)\t Ltd.6,\t this  Court
\nobserved:\n<\/p>\n
\t      “We are surprised, not a little, that the High
\n\t      Court   of  Calcutta  should  have   exercised
\n\t      jurisdiction in a case where it had absolutely
\n\t      no jurisdiction.”\n<\/p><\/blockquote>\n
In  that  case,\t the contract in question  was\texecuted  at
\nAligarh,  the  construction work was to be  carried  out  at
\nAligarh, the contracts provided that in the event of dispute
\nthe   Aligarh  court  alone  will  have\t jurisdiction,\t the
\narbitrator  was appointed at Aligarh and was to function  at
\nAligarh\t and  yet  merely  because  the\t respondent  was   a
\nCalcutta-based\tfirm,  it  instituted  proceedings  in\t the
\nCalcutta   High\t  Court\t and  the   High   Court   exercised
\njurisdiction  where  it\t had none whatsoever.\tIt  must  be
\nremembered that the image and prestige of a court depends on
\nhow the members of that institution conduct themselves.\t  If
\nan  impression\tgains ground that even in cases\t which\tfall
\noutside\t the territorial jurisdiction of the court,  certain
\nmembers\t  of  the  court  would\t be  willing   to   exercise
\njurisdiction  on the plea that some event,  however  trivial
\nand unconnected with the cause of action had occurred within
\nthe jurisdiction of the said court, litigants would seek  to
\nabuse the process by carrying the cause before such  members
\ngiving\trise to avoidable suspicion.  That would  lower\t the
\ndignity\t of  the institution and put the  entire  system  to
\nridicule.  We are greatly pained to say so but if we do\t not
\nstrongly  deprecate  the growing tendency we  will,  we\t are
\nafraid,\t be failing in our duty to the institution  and\t the
\nsystem\tof  administration of Justice.\tWe do hope  that  we
\nwill  not  have\t another  occasion  to\tdeal  with  such   a
\nsituation.\n<\/p>\n
13.The\tsubmission of the learned counsel for NICCO  based
\non  Section 21 of the Code of Civil Procedure that  even  if
\nthis  Court comes to the conclusion that the High  Court  of
\nCalcutta  had  no jurisdiction, this Court  should,  in\t the
\nabsence of proof of prejudice, refuse to interfere with\t the
\ndecision  of the High Court unless it is otherwise found  to
\nbe erroneous.\n<\/p>\n
6 (1994)4SCC 710
\n723<\/span>
\nWhile  the  spirit  of\tSection 21  of\tthe  Code  of  Civil
\nProcedure may support such a submission, we are afraid,\t the
\ndiscretion  cannot  be\tused  in favour\t of  a\tparty  which
\ndeliberately  invokes the jurisdiction of a court which\t has
\nno jurisdiction whatsoever for ulterior motives.  That would
\nonly   encourage  such\ttype  of  litigation.\tThe   object
\nunderlying  the provision in Section 21 is not to  encourage
\nsuch litigants but to avoid harassment to litigants who\t had
\nbona fide and in good faith commenced proceedings in a court
\nwhich is later found to be wanting in jurisdiction.  In\t the
\ninstant case, we are convinced, beyond doubt, that NICCO did
\nnot  act  bona fide in moving the Calcutta High\t Court\tand,
\ntherefore, the submission based on Section 21 must fail.\n<\/p>\n
14.Before  we part we must clarify that we  have  confined
\nourselves  to deciding whether on the averments made in\t the
\npetition  any part of the cause of action is shown  to\thave
\narisen\twithin the jurisdiction of the Calcutta High  Court.
\nEven  if  we had come to the conclusion that  the  averments
\ndisclosed  that\t a part of the cause of\t action\t had  arisen
\nwithin the jurisdiction of the said Court and therefore\t the
\npetition could be entertained by that Court, it would  still
\nhave  been open for the opposite party to dispute  the\tsaid
\naverments  and\tif  the opposite party were  to\t succeed  in
\nshowing\t that the averments were not true and  correct,\t the
\npetition,  though  entertained,\t would\tfail  for  want\t  of
\njurisdiction.\n<\/p>\n
15.In  the  result, we allow this appeal,  set\taside  the
\norder  of the High Court and direct that the  writ  petition
\nwill  stand disposed of for want of jurisdiction.  Since  we
\nare satisfied that NICCO had not invoked the jurisdiction of
\nthe  Calcutta High Court bona fide, we think that this is  a
\nfit  case for granting exemplary costs to ensure  that\tsuch
\nabuse  of  the Court’s jurisdiction does not take  place  in
\nfuture.\t We, therefore, direct NICCO to pay Rs 50,000 by way
\nof costs.\n<\/p>\n
724<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Oil & Natural Gas Commission vs Utpal Kumar Basu on 23 June, 1994 Equivalent citations: 1994 SCC (4) 711, JT 1994 (5) 1 Author: Ahmadi Bench: Ahmadi, A.M. (J) PETITIONER: OIL & NATURAL GAS COMMISSION Vs. RESPONDENT: UTPAL KUMAR BASU DATE OF JUDGMENT23\/06\/1994 BENCH: AHMADI, A.M. (J) BENCH: AHMADI, A.M. (J) […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-67579","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nOil & Natural Gas Commission vs Utpal Kumar Basu on 23 June, 1994 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/oil-natural-gas-commission-vs-utpal-kumar-basu-on-23-june-1994\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Oil & Natural Gas Commission vs Utpal Kumar Basu on 23 June, 1994 - 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