Territorial jurisdiction under Section 20 CPC turns on business or cause of action, not mere office presence for sovereign functions.

Territorial jurisdiction under Section 20 CPC depends on the defendant residing, carrying on business, personally working for gain, or the cause of action arising within the court's limits. In a dispute over making an arbitral award a rule of court, the Supreme Court of India noted that the Union of India, when acting through governmental machinery for construction of an ordnance factory, was performing a sovereign function and not carrying on commercial business in Delhi. Mere presence of an office in Delhi was insufficient to establish jurisdiction. The distinction between sovereign functions and commercial activity was treated as decisive, and the Delhi High Court was held to lack territorial jurisdiction.

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Issues: Whether the Delhi High Court had territorial jurisdiction to entertain a petition for making an arbitral award a rule of the court when the contract was executed and performed in Uttar Pradesh and the Union of India was alleged to carry on business at Delhi.

Analysis: Jurisdiction under Section 20 of the Code of Civil Procedure, 1908 depends on the defendant residing, carrying on business, personally working for gain, or on the cause of action arising within the local limits of the court. The Union of India, when acting through its governmental machinery in relation to construction of an ordnance factory for the Military Engineering Services, was discharging a sovereign function and not carrying on a commercial business at Delhi. The mere presence of an office at Delhi did not establish that the Union carried on business there for the purposes of Section 20. The distinction between commercial activities, such as running railways, and sovereign functions was applied to hold that the authority cited by the appellant did not assist him.

Conclusion: The Delhi High Court had no jurisdiction, and the objection to territorial jurisdiction was rightly upheld.

Final Conclusion: The appeal failed on the jurisdictional issue, but liberty was left to the appellant to seek appropriate relief in a competent court in Uttar Pradesh within the time allowed.

Ratio Decidendi: For purposes of Section 20 of the Code of Civil Procedure, 1908, the Union of India does not carry on business or personally work for gain merely because its office is at Delhi when the dispute arises from a sovereign governmental function rather than a commercial activity.

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