Full Judgment Text
$~
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment reserved on: 28.01.2026
Judgment pronounced on: 15.04.2026
Judgment uploaded on: 15.04.2026
+ FAO(OS) (COMM) 281/2024 & CM APPL. 72787/2024
JAIN IRRIGATION SYSTEMS LIMITED .....Appellant
Through: Mr. Jayant Mehta, Sr. Adv.
along with Mr. Govind
Manoharan, Mr. Tenzing
Namgyal Bhutia, Mr. Rithwik
Narayanan and Mr. Pallav
Arora, Advs.
versus
M/S. PRAGYAWAN TECHNOLOGIES PRIVATE LIMITED
.....Respondent
Through: Mr. Rohan Chawla, Ms.
Ananaya Narin Tyagi, Ms.
Darshana Deepak Das and Mr.
Rohan Rana, Advs.
CORAM:
HON'BLE MR. JUSTICE ANIL KSHETARPAL
HON'BLE MR. JUSTICE AMIT MAHAJAN
J U D G M E N T
ANIL KSHETARPAL, J.:
1. Through the present Appeal, the Appellant assails the
correctness of the order dated 17.09.2024 [hereinafter referred to as
„Impugned Order‟] passed by the learned Single Judge in I.A. No.
4516/2024 in CS (COMM) No. 759 of 2023, whereby the learned
Single Judge has allowed the Respondent's [Defendant before the
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 1 of 13
learned Single Judge] application under Order VII Rule 10 of the
Code of Civil Procedure [hereinafter referred to as „CPC‟] and
returned the plaint for presentation before the competent court, while
also imposing costs of Rs.10,000/- on the Appellant [Plaintiff before
the learned Single Judge] for suppression of material facts.
FACTUAL MATRIX
2. The Appellant, a company engaged in the manufacture of
irrigation systems and pipes, entered into a commercial arrangement
with the Respondent for the supply of 2000 Kms of PLB Duct pipes in
four tranches. The total sale consideration for the project was
estimated at Rs.9,79,40,000/-.
3. The transaction sequence, as per the pleadings, is as follows:
i. Preliminary Negotiations: Representatives of both parties met
on several occasions in early 2019 to discuss requirements, which
discussions allegedly took place at the Appellant‟s office at Delhi.
ii. Techno-Commercial Offer: On 07.06.2019, the Appellant
issued a formal response letter from its Delhi office, recording the
terms for the supply of 2000 Kms of pipes.
iii. Purchase Orders: Subsequently, the Respondent issued two
Purchase Orders:
a. PO No. PTPL/JAIN/DUCT/06/2019001 dated
10.06.2019.
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 2 of 13
b. PO No. PTPL/JAIN/DUCT/07/2019/002 dated
10.07.2019.
iv. Dispute and Breach: Disputes arose regarding Third-Party
Inspection Agency (TPIA) delays at the Appellant's Jalgaon
(Maharashtra) factory, marking protocols on the pipes (specifically the
exclusion of the Appellant‟s name), and discrepancies in the Letters of
Credit (LC).
v. Recovery Suit: The Appellant instituted the underlying suit
[CS (COMM) 759/2023] seeking recovery of Rs.3,49,70,864.13/-
representing unpaid dues for goods delivered and losses incurred due
to the Respondent's alleged failure to take delivery of the remaining
pipes.
4. The Appellant invoked the territorial jurisdiction of this Court
primarily on the basis that the Respondent maintains its registered
office at Delhi and that the Purchase Orders issued by the Respondent
contained an "exclusive jurisdiction clause" vesting jurisdiction in
Delhi Courts.
CONTENTIONS ON BEHALF OF THE APPELLANT:
5. Learned senior counsel for the Appellant contended that the
learned Single Judge has erred in returning the plaint. Learned senior
counsel has submitted that as dominus litus , the Appellant has the
inherent right to choose its forum among the options available under
Section 20 of the CPC.
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 3 of 13
6. It was argued that a material part of the cause of action accrued
in Delhi, where preliminary negotiations occurred and the techno-
commercial offer – the bedrock of the agreement was issued. Since the
Respondent‟s registered office is also in Delhi, the Appellant
maintains that jurisdiction was properly invoked under Section 20(a)
and (c).
7. Learned senior counsel further emphasized that the Respondent
is bound by the "exclusive jurisdiction" clause contained in its own
Purchase Orders. Learned senior counsel has further contended that
the Respondent cannot unilaterally retract from this contractual
stipulation.
8. Finally, the Appellant alleged that the learned Single Judge
conducted an impermissible "mini-trial." It was argued that at the
stage of Order VII Rule 10 CPC, the Court should have accepted the
plaint averments as true rather than scrutinizing the merits of what
constituted the "real" cause of action.
9. It was also argued that the learned Single Judge has erroneously
imposed costs on the Appellant for non-disclosure of facts without
appreciating that it has been declared in the plaint that a suit filed by
the Respondent is pending in Noida. It was also submitted that the
rejection of the Appellant's application for return of plaint in the
Noida Suit cannot be said to be a material fact, and moreover, the
order rejecting the Appellant's application is under challenge before
the Allahabad High Court.
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 4 of 13
CONTENTIONS ON BEHALF OF THE RESPONDENT:
10. Learned counsel for the Respondent supported the Impugned
Order, arguing that the operational reality of the Respondent‟s
business is based entirely out of Noida, Uttar Pradesh. Learned
counsel has submitted that the registered office in Delhi is a mere
formality and does not constitute "carrying on business" in the context
of this dispute.
11. It was contended that no part of the contract was performed in
Delhi. The Purchase Orders were issued from Noida, and the goods
were manufactured in Jalgaon for delivery elsewhere. Since the cause
of action arose where the Respondent has a subordinate office
(Noida), Counsel argued that the "Explanation" to Section 20 CPC, as
interpreted in Patel Roadways Limited, Bombay v. Prasad Trading
1
Company , mandates that the suit be filed in Noida.
12. Learned counsel for the Respondent further argued that the
"exclusive jurisdiction" clause cannot confer jurisdiction on a Court
that lacks it under the statutory deeming fiction of Section 20.
13. Lastly, learned counsel for the Respondent highlighted that the
Appellant deliberately suppressed the fact that a prior suit (C.S. No. 9
of 2020) regarding the same dispute was already pending in the Noida
Court, where the Appellant‟s own application for rejection of the
plaint had been dismissed.
1
(1991) 4 SCC 270
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 5 of 13
ANALYSIS:
14. Before exercising powers under Order VII Rule 10 of the CPC,
the Court is duty-bound to undertake a holistic, meaningful and
comprehensive reading of the plaint. The test is not to be applied
mechanically or by isolating stray averments, but by discerning the
real nature of the dispute, the bundle of essential facts constituting the
cause of action, and the place where such facts have arisen. The
learned Single Judge has correctly applied this settled principle.
15. A careful reading of the plaint unmistakably reveals that the
plaintiff, in substance, seeks recovery of amounts allegedly due under
two purchase orders. The grievance articulated is twofold: first , that
the Respondent failed to take delivery of PLP duct pipes
manufactured pursuant to the purchase orders; and second , that the
Respondent failed to pay the balance consideration despite having
received delivery of part of the consignment. It is not in dispute that
both purchase orders were placed by the Respondent from its office at
Gautam Budh Nagar (Noida), and that the manufacturing of the pipes
was undertaken at the Appellant‟s factory situated at Jalgaon.
16. The contractual arrangement between the parties further
stipulates that delivery of the PLP duct pipes was to be taken by the
Respondent at the Appellant‟s factory premises at Jalgaon. Thus, the
place of performance of the contract, insofar as delivery is concerned,
is clearly Jalgaon. The alleged breach-failure to lift goods and failure
to pay for goods supplied is intrinsically linked to this place of
performance.
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 6 of 13
17. The Appellant asserts territorial jurisdiction of the courts at
Delhi primarily on three grounds: (i) that certain discussions between
the parties took place in Delhi; (ii) that the purchase orders contain an
exclusive jurisdiction clause in favour of Delhi courts; and (iii) that
the registered office of the defendant is in Delhi. However, none of
these factors, either individually or cumulatively, can confer
jurisdiction in the absence of accrual of any part of the cause of action
within the territorial limits of Delhi.
18. It is a settled proposition of law that parties by agreement
cannot confer jurisdiction upon a court which otherwise lacks it. An
exclusive jurisdiction clause is enforceable only where two or more
courts otherwise have jurisdiction under Section 20 of the CPC, i.e.,
where part of the cause of action arises in more than one territorial
jurisdiction. Only in such a situation can parties restrict themselves to
one of the competent courts. Where no part of the cause of action
arises within the territorial limits of the chosen forum, an exclusive
jurisdiction clause is rendered ineffectual.
19.1 In the present case, the Respondent admittedly has its corporate
office as well as operational workplace at Noida. The purchase orders
were issued from Noida and were transmitted to the Appellant‟s
factory and registered office at Jalgaon. The pipes were fabricated and
kept ready for delivery at Jalgaon, where the Respondent was required
to take delivery. The alleged default - non-lifting of goods and non-
payment therefore arose entirely outside Delhi. The mere assertion
that some preliminary discussions took place in Delhi does not
constitute a material, integral or essential part of the cause of action.
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 7 of 13
Jurisdiction cannot be founded on casual or incidental facts which do
not have a direct nexus with the lis .
19.2 Although the Appellant has endeavoured to place reliance on
the techno-commercial offer dated 07.06.2019 before this Court, it is
well-settled that in a suit pertaining to breach of contract, mere
making of an offer on a particular place does not confer jurisdiction on
that place as the contract can only be said to be made on acceptance of
an offer. Making of an offer does not form as part of the cause of
action [Ref. A.B.C. Laminart (P) Ltd. v. A.P. Agencies (1989) 2 SCC
163; Bhagwandas Goverdhandas Kedia v. Girdharilal
2
Parshottamdas & Co. ]. From the very nomenclature of the
communication dated 07.06.2019, it is evident that the same was
merely an offer and it does not imply conclusion of the contract
between the parties. In the present case, as noted above, the purchase
orders placed were placed from Noida pursuant to the offer dated
07.06.2019
20. Equally, the presence of the Respondent‟s registered office at
Delhi does not, by itself, vest jurisdiction in Delhi Courts. Section 20
of the CPC governs territorial jurisdiction. It provides, in essence, that
every civil suit shall be instituted in a Court within whose local limits:
i. Clause (a): the defendant, at the time of suit, actually and
voluntarily resides, or carries on business, or personally works for
gain;
2
1965 SCC OnLine SC 38
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 8 of 13
ii. Clause (b): (if multiple defendants) any of the defendants
resides or carries on business (with leave of court or acquiescence); or
iii. Clause (c): the cause of action, wholly or in part, arises.
21. The Explanation to Section 20 of the CPC adds for corporate
Defendants: a 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. In summary, a Plaintiff may sue a Defendant where it resides or
does business, or where the cause of action arose, and for a company
the statute deems its principal office (or a subordinate office
connected to the claim) as a place of business.
22. These provisions have been explained by the Supreme Court in
3
Patel Roadways Ltd. v. Prasad Trading Co. . The Supreme Court
held that if a corporation has a sole or principal office at a place, the
courts there have jurisdiction (since the company is “deemed to carry
on business” there by fiction). However, if the corporation has a
principal office at one place and a subordinate office at another, and
the cause of action arises at the subordinate office, then jurisdiction
lies at the subordinate office‟s location, not at the principal office. The
disjunctive phrasing of the Explanation („or‟) makes clear that these
are alternative scenarios: the relevant forum is either the principal
office (if no subordinate office is involved) or the subordinate office
linked to the cause of action. Crucially, the Supreme Court observed
that if a cause of action arises at the site of a subordinate office, the
3
1992 AIR 1514
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 9 of 13
corporation cannot insist on a forum at its principal place of business.
In short, the Explanation is not a carte blanche for the principal office
if the claim arose elsewhere.
23. It is also significant that the contract was neither made nor
accepted at Delhi. Admittedly, partial payments under the contract, if
any, were not made at Delhi. No contractual obligation was required
to be performed at Delhi, nor is any breach alleged to have occurred
there. It is not even the Appellant‟s case that the Respondent carries
out any commercial or contractual activities within the territorial
jurisdiction of Courts at Delhi, apart from maintaining a registered
office. The entirety of the commercial dealings emanated from Noida
and culminated at Jalgaon.
24. During the course of arguments, learned Senior Counsel for the
Appellant relied on Aakash Chaturbhuj Chhabria v. Hewlett
Packard Enterprises India Pvt Ltd [FAO(OS) 50/2025] to argue for a
"holistic" and "composite" view of the cause of action. However, that
decision is fundamentally distinct as it involved a multi-party fraud
conspiracy where a composite cause of action arose from a single,
indivisible fraudulent design. Invoking Section 20(b) of the CPC, the
Court held the suit could not be bifurcated because several defendants
resided within the jurisdiction, making the "composite" nature of the
fraud the pivot of the decision.
25. In contrast, the present matter is a straightforward commercial
dispute between a single Plaintiff and a single Corporate Defendant.
Unlike the conspiratorial group in Aakash Chaturbhuj , a corporation
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 10 of 13
is governed by the mandatory "deeming fiction" contained in the
Explanation to Section 20 of the CPC. As settled in Patel Roadways
Limited , this Explanation creates a restrictive hierarchy: if a cause of
action arises at a place where a corporation has a subordinate office
(Noida), that place is deemed its sole place of business for the purpose
of the suit, to the exclusion of the principal office.
26. Consequently, the "composite cause of action" theory cannot be
imported into a sale-of-goods contract where the performance and
breach occurred exclusively within the jurisdiction of a subordinate
office. In such commercial contracts, preliminary discussions or
techno-commercial offers are merely incidental; the "real" cause of
action- the failure to take delivery and failure to pay is rooted entirely
in Noida. Since the statutory mandate anchors jurisdiction to the
Noida-Jalgaon nexus, the principles laid down in Aakash Chaturbhuj
do not come to the aid of the Appellant.
27. While adjudicating an application under Order VII Rule 10 of
the CPC, the Court is required to adopt a pragmatic and realistic
approach and ascertain where the “real cause of action” arose. Mere
placement of a purchase order may constitute one step in the
transaction, but even that, in the present case, occurred at Noida. The
core dispute does not concern the issuance of purchase orders per se,
but centres on failure to take delivery of goods and failure to make
payment for goods already supplied or lying ready at the Appellant‟s
factory. These facts form the heart of the cause of action and are
wholly unconnected with Delhi.
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 11 of 13
28. Insofar as the issue of imposition of cost of Rs.10,000/-is
concerned, in the opinion of this Court, the same warrants no
interference. The learned Single Judge has aptly considered the issue
in relation to suppression of material facts and rightly observed that
the non-disclosure of the rejection of the Appellant's application for
return of plaint in the Noida Suit cannot be said to be inconsequential
merely because the same had been challenged by the Appellant before
the Allahabad High Court. This Court is also unpersuaded by the
contention made on behalf of the Appellant that the rejection of the
Appellant's application cannot be said to be a material fact. Identical
plea in relation to the jurisdiction clause encompassed in the purchase
orders were raised by the Appellant in the application for return of
plaint in the Noida suit as well as in the subject suit in relation to
territorial jurisdiction. While the issue may be sub judice before the
Allahabad High Court, it was incumbent on the Appellant to make a
full disclosure in relation to the same in the plaint.
CONCLUSION:
29. In view of the aforegoing, the learned Single Judge has
meticulously considered all these aspects and correctly concluded that
no part of the cause of action accrued within the territorial jurisdiction
of Courts at Delhi. The conclusion is not only plausible but is firmly
grounded in the pleadings, the contractual documents, and settled
principles governing territorial jurisdiction. The Costs have also been
rightly imposed.
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 12 of 13
30. Consequently, this Court finds no infirmity, factual or legal, in
the Impugned Order warranting interference in the present Appeal.
31. Accordingly, the present Appeal, being devoid of merit, is
dismissed. The pending application also stands closed.
ANIL KSHETARPAL, J.
AMIT MAHAJAN, J.
APRIL 15, 2026
s.godara/kb
Signature Not Verified
Signed By:SAVITA
PASRICHA
Signing Date:15.04.2026
16:28:28
FAO(OS)(COMM) 281/2024 Page 13 of 13