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jurisdiction to file money recovery suit.

Section 20 of CPC :Subject to the limitations aforesaid, every suit shall be instituted in Court within the local limits of whose jurisdiction-

(a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain; or

(b) any of the defendants, where there are more than one, at the time of the commencement of the suit actually and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either the leave of the Court is given, or the defendants who do not reside, or carry on business, or personally work for gain, as aforesaid, acquiesce in such institution; or

(c) the cause of action, wholly or in part, arises.

1[* * *]

2[Explanation].-A corporation shall be deemed to carry on business at its sole or principal office in 3[India] or, in respect of any cause of action arising at any place where it has also a subordinate office, at such place.


Section 20 C. P. C provides for two different grounds each of which can be availed of by the plaintiff to file his suit. A Court gels jurisdiction under Section 20 C.P.C. to try the suit if:–

 The defendant resides or carries on business or personally works for gain within the local limits of its jurisdiction, or

 The cause of action arises wholly or in part within such local limits.

 Since the shuit is against the Union of India as represented by the Western Railway Administration first question to be considered is whether Indore run be considered to be a place where the Union of India represented by Western Railway Administration can be said to carry on business at Indore.

 Explanation(II) under Section 20 C.P.C. provides that corporation shall be deemed to carry on business at its sole or principal office in India or in respect of any cause of action arising at any place where it has also a subordinate office, at such place II therefore follows from this Explanation that in case the Western Railway Administration can be called a Corporation within the meaning of the term as used in Explanation (II) then Indore cannot be the place where it can be said to carry on its business as the principal office of the Western Railway is situated at Bombay and not at Indore. In P.C. Biswas v. Union of India. (S) AIR 1956 Assam 85 at 94 it was bold that just as in the case of a private corporation carrying on business of transport the head office from which it categories on administration would be its principal place of business and not any place in the entire area to which its operations extend. The Union of India through a Railway Administration should be taken or deemed as carrying on business only where its head office is situated and not at all places where any activity connected with transport by rail is carried on This case was approved by the Supreme Court in a case reported in Union of India v Ladulal Jain, AIR 1963 SC 1681 Their Lordships pointed out that the principle behind the provisions of Clauses (a) and (b) of Section 20 C.P.C. is that the suit be Instituted at a place where the defendant be able to defend it without undue trouble. It considered the expression ‘carries on business as used in Section 20 C.I.C. and held that the Union of India carries on business of running railways and can be sued in a Court within whose territorial jurisdiction the head quarter of a Railway Administration is situated. It is implicit in this judgment that the Union of India represented by a Railway Administration is in the position of a Corporation and Explanation (II) at the fool of Section 20 C.P.C. applies to it. The decision clearly indicates that in as much as Indore is not a Head Quarter of Western Railway. Indore Court could not be made a place of suing on the ground that the Railway Administration carries on business at Indore


CITATION OF JUDGMENTS:

Madhya Pradesh High Court
Maniklal Mittal vs The Union Of India (Uoi) on 20 February, 1964
Equivalent citations: AIR 1966 MP 243
Author: V Newaskar
Bench: V Newaskar

ORDER V.R. Newaskar, J.

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