1999 (2) TMI 727 - HC - Indian Laws

Jurisdiction Declined: Court Dismisses Suit Favoring Rajasthan for Key Events, Grants Costs, and Vacates Interim Order.

Hindusthan Zinc Ltd. Versus Gujarat NRE Coke Ltd.

The Calcutta HC upheld the revocation of leave under Clause 12 of the Letters Patent, determining it lacked jurisdiction as the cause of action arose ... - Issues:Jurisdiction of the Court, Revocation of leave under Clause 12 of the Letters Patent, Balance of convenience, Observations made by the learned single Judge.Jurisdiction of the Court:The judgment involved two appeals related to an order allowing an application by Hindusthan Zinc Ltd. (HZL) for revocation of leave under Clause 12 of the Letters Patent and the rejection of a suit filed by Gujarat NRE Coke Ltd. The Court examined the facts surrounding the case, including the location of the advertisement, receipt of tender notice, and issuance of the offer by Gujarat NRE from Calcutta. Gujarat NRE filed a suit against HZL under Clause 12 of the Letters Patent, seeking various declarations, injunctions, and reliefs. The Court found that no part of the cause of action had arisen within its jurisdiction, as the rejection letter was addressed to Gujarat NRE's office outside Calcutta. The jurisdictional clause in the tender documents favored the Udaypur Court in Rajasthan, and the balance of convenience was in favor of Rajasthan. The Court dismissed the suit and vacated the interim order, emphasizing that the rejection was outside its jurisdiction.Revocation of Leave under Clause 12 of the Letters Patent:HZL filed an application to revoke the leave under Clause 12, arguing that the cause of action did not arise within the Court's jurisdiction. The Court accepted HZL's submission, noting that the rejection letter was sent to Gujarat NRE's office outside Calcutta. Gujarat NRE contended that the jurisdictional clause was in the contract, which was yet to be executed. The Court upheld the revocation of leave, citing a similar case precedent where the cause of action did not arise within the Court's jurisdiction based on the facts presented.Balance of Convenience:The Court determined that the balance of convenience overwhelmingly favored Rajasthan, where tenders were scrutinized, rejection occurred, and the contract was to be performed. The samples were tested and rejected outside the Court's jurisdiction, making it unnecessary for witnesses from Calcutta. The Court referenced previous cases to support its decision that the matter should be tried in Rajasthan, emphasizing that the rejection took place outside Calcutta's jurisdiction.Observations made by the learned single Judge:The judgment addressed HZL's grievance regarding an observation made by the single Judge after dismissing the suit due to lack of jurisdiction. The Court agreed that the observation was improper as the Court lacked jurisdiction to entertain the suit in the first place. Consequently, the Court allowed HZL's appeal, deleted the observation, dismissed Gujarat NRE's appeal, and directed Gujarat NRE to pay costs to HZL.In conclusion, the High Court of Calcutta upheld the revocation of leave under Clause 12 of the Letters Patent due to lack of jurisdiction, emphasized the balance of convenience favoring Rajasthan, and corrected the improper observation made by the single Judge. The judgment provided a detailed analysis of the facts, legal precedents, and considerations leading to the disposal of the appeals and the order for costs.