Itc Ltd vs Kn Agri Resources

Court: Madhya Pradesh High Court
Decided on: 31-03-2026

<div> NEUTRAL CITATION NO. 2026:MPHC-JBP:25581 1 MP-5797-2024 IN THE HIGH COURT OF MADHYA PRADESH AT JABALPUR BEFORE HON'BLE SHRI JUSTICE VIVEK RUSIA & HON'BLE SHRI JUSTICE PRADEEP MITTAL st ON THE 31 OF MARCH, 2026 MISC. PETITION No. 5797 of 2024 ITC LTD Versus KN AGRI RESOURCES Appearance: Shri Kishore Shrivastava, Senior Advocate with Shri Priyankush Jain and Ms. Aditi Shrivastava, Advocates for petitioner. Shri Shantanu Chourasia, Advocate appears through VC for respondent. ORDER Per: Justice Pradeep Mittal This petition under Article 227 of the Constitution of India is filed against the order dated 21.08.2024 passed by the District Judge, Commercial Court Bhopal whereby the application filed by the petitioner/defendant under Order VII Rule 11 read with Section 151 of the CPC has been dismissed. 2. The contention of the petitioner/defendant is that the respondent/plaintiff has filed the present suit seeking compensation of Rs.2,35,15,275/- on account of breach of contract, along with interest at the rate of 24% per annum. However, the respondent/plaintiff has not clearly specified in the plaint as to when the cause of action arose. Therefore, on this Signature Not Verified Signed by: MANVENDRA SINGH PARIHAR Signing time: 02-04-2026 11:24:20 NEUTRAL CITATION NO. 2026:MPHC-JBP:25581 2 MP-5797-2024 ground, the plaint is liable to be rejected. Additionally, the petitioner/defendant before the Commercial Court has contended that the said court lacks territorial jurisdiction to entertain the suit. It is stated that the purchase contract, on the basis of which the suit has been filed, clearly mentions that in case of any dispute between the parties, the courts at Guntur shall have jurisdiction. The petitioner/defendant has further submitted that its head office is situated in Guntur. It is also objected that the respondent/plaintiff did not file a statement of truth along with the plaint. Hence, on these grounds as well, the plaint deserves to be rejected. Accordingly, the petitioner/defendant has prayed for rejection of the plaint. 3. In support of the contention the learned senior counsel for the petitioner relied upon the judgments of the Hon'ble Supreme Court and various High Courts in the cases of Kamala and others Vs. K.T. Eshwara Sa and others reported as (2008) 12 SCC 661, Shriram City Union finance Corporation Ltd. Vs. Rama Mishra (2002) 9 SCC 613, Rajasthan State Electricity Board Vs. Universal Petrol Chemicals Limited (2009) 3 SCC 107, Swastik Gases Private Limited Vs. Indian Oil Corporation Limited (2013) 9 SCC 32, Reliance Securities Ltd. Vs. Ajit Kumar 2016 SCC OnLine MP 10541, Wollaque Ventilation and Conditioning Pvt Ltd. Vs. Sterling Tools Ltd. 2011 SCC OnLine Del893: (2011) 177 DLT 731, Dahiben Vs. Arvindbhai Kalyanji Bhanuysali (Gajra) dead Through Legal Representatives and others (2020) 7 SCC 366, Bajranglal Agarwal Vs. Susheela Agarwal and others 2024 SCC OnLine TS 1823 SPML Infra Limited Vs. Graphite India Limited 2020 SCC OnLine Del 2808: (2020)3 Signature Not Verified Signed by: MANVENDRA SINGH PARIHAR Signing time: 02-04-2026 11:24:20 NEUTRAL CITATION NO. 2026:MPHC-JBP:25581 3 MP-5797-2024 Arb LR 439, M/s Bharat Barrel and Drum MFG. Co. Vs. The Employees State Insurance Corporation 1971(2) SCC 860, Nibro Limited Vs. National Insurance Company Limited 1990 SCC OnLine Del 65:ILR (1991) 2 Del 172 : AIR 1991 Delhi 25, State Bank of Travancore Vs. Kingston Computers India Private Limited, (2011) 11 SCC 524 to argue that where parties have entered into an agreement regarding jurisdiction, only the court agreed upon shall have jurisdiction to decide disputes. It is further argued that even if words like “alone,” “only,” or “exclusive jurisdiction” are not expressly used, the intention of the parties to confer jurisdiction on one court is sufficient to exclude other courts. 4. The respondent/plaintiff had opposed the application before the Commercial Court contending that under Section 20 of the Code of Civil Procedure, jurisdiction is conferred upon courts, and where more than one court has jurisdiction, the parties may agree to vest jurisdiction in any one of such courts. In the present case, since the cause of action arose in Khandwa, this Commercial Court has jurisdiction to hear the matter. The respondent/plaintiff further submitted that the contract was neither executed in Guntur nor was the delivery of goods made there. It is also stated that the petitioner/defendant has an office in Bhopal; therefore, the Commercial Court at Bhopal has jurisdiction. The application filed by the petitioner/defendant under Order VII Rule 11 CPC being misconceived, baseless, and not maintainable, and was rigthly dismissed. The Defendant’s application was defective, as it was not duly signed on each page and was unsupported by any valid authorization such as a Board Resolution or Power Signature Not Verified Signed by: MANVENDRA SINGH PARIHAR Signing time: 02-04-2026 11:24:20 NEUTRAL CITATION NO. 2026:MPHC-JBP:25581 4 MP-5797-2024 of Attorney. The Plaintiff has duly disclosed the cause of action and territorial jurisdiction in the plaint. The cause of action arose in Khandwa, and the defendant carries on business in Bhopal; therefore, the Commercial Court had proper jurisdiction. The contention regarding exclusive jurisdiction of courts at Guntur is untenable, as no part of the cause of action arose there, nor does the petitioner/defendant carry on business there. The plaint, when read as a whole, clearly discloses a valid cause of action. The petitioner/defendant’s objections are merely technical, frivolous, and intended to delay the proceedings. The plaint discloses substantial material facts requiring adjudication on merits and cannot be rejected on such grounds. Accordingly, the petition filed by the defendant deserves to be dismissed with costs. 5. Respondent relied upon the judgments in the cases of Peerless General Finance & Investment Co. Ltd. vs. Punjab & Sind Bank 2008(1)CTLJ74(DEL), Kamla vs. K.T. Eshwara Sa & Others (2008) 12 SCC 661, Harji Engineering Works Pvt. Ltd. vs. Hindustan Steel Works Construction Ltd. 2021 SCC OnLine Cal 2457. 6. The Commercial Court after hearing the parties held that although the agreement provides for jurisdiction of courts at Guntur, the petitioner/defendant has failed to establish any legal basis conferring jurisdiction on those courts. The material on record indicates that the petitioner/defendant is based in Bhopal and the cause of action arose in Khandwa; hence, the objection to territorial jurisdiction is untenable. It further held that the objection regarding non-filing of the statement of truth is Signature Not Verified Signed by: MANVENDRA SINGH PARIHAR Signing time: 02-04-2026 11:24:20 NEUTRAL CITATION NO. 2026:MPHC-JBP:25581 5 MP-5797-2024 also without merit, as the same was subsequently filed. Further, a reading of the plaint as a whole discloses a cause of action based on alleged breach of contract and dismissed the application under Order 7 Rule 11 CPC. 7. Heard the learned counsel for parties and perused the material available on record. 8. In the case of Maharashtra Chess Assn. v. Union of India, (2020) 13 SCC 285 it was held that parties cannot by agreement confer jurisdiction on a court which lacks the jurisdiction to adjudicate. But where several courts would have jurisdiction to try the subject-matter of the dispute, they can stipulate that a suit be brought exclusively before one of the several courts, to the exclusion of the others. 9. In the case of Riveria Commercial Developers Ltd. Versus Brompton Lifestyle Brands Pvt. Ltd. 2022 SCC OnLine Del 4624 it was held that the High Court of Calcutta in Harji Engineering Works Pvt. Ltd. v. Hindustan Steel Works Construction Ltd., 2021 SCC OnLine Cal 2457, has ruled that the consequence of not filing a ‘Statement of Truth’ in the prescribed form would not debar a party from proceeding with the Suit if such defect is cured. 10. In the case of A V Industries Vs Neo Neon Electrical Pvt. Ltd. 2023 SCC OnLine Del 5397, it was held that the issue of part cause of action having arisen is wholly untenable for the reason that the learned counsel for the respondent/plaintiff was unable to show even one instance of any cause of action having arisen at Delhi at all. 11. In the case of Mayar (H.K.) Ltd. v. Vessel M.V. Fortune Signature Not Verified Signed by: MANVENDRA SINGH PARIHAR Signing time: 02-04-2026 11:24:20 NEUTRAL CITATION NO. 2026:MPHC-JBP:25581 6 MP-5797-2024 Express, (2006) 3 SCC 100, it was held that the Court has found that the Calcutta Court has jurisdiction to try the proceedings except when the forum selection clause excludes the jurisdiction of the Court. 12. In case Nahar Industrial Enterprises Ltd. v. Hong Kong and Shanghai Banking Corpn., (2009) 8 SCC 646 following Dwarka Prasad Agarwal v. Ramesh Chander Agarwal [(2003) 6 SCC 220 in which it was held that a bare perusal of the aforementioned provisions leaves no manner of doubt that thereby the jurisdiction of the civil court has not been ousted. The civil court, in the instant case, was concerned with the rival claims of the parties as to whether one party has illegally been dispossessed by the other or not. Such a suit, apart from the general law, would also be maintainable in terms of Section 6 of the Specific Relief Act, 1963. 13. In the case of Hakam Singh v. Gammon (India) Ltd., (1971) 1 SCC 286 it was held that plainly by the terms of Section 20(a), read with Explanation II, the respondent Company was liable to be sued at Bombay where it had its principal place of business. 14. After considering all cited judgements of both sides, it is emersed that this is a well-settled principle of law that when multiple courts have jurisdiction over a dispute, the parties can choose one of them. However, parties cannot confer jurisdiction on a court that has no inherent jurisdiction to hear the case. 15. This means that while contractual agreements to choose one court over another are valid (exclusive jurisdiction clauses), such agreements only apply to courts that are already competent to hear the matter under the Signature Not Verified Signed by: MANVENDRA SINGH PARIHAR Signing time: 02-04-2026 11:24:20 NEUTRAL CITATION NO. 2026:MPHC-JBP:25581 7 MP-5797-2024 Code of Civil Procedure (CPC) or other applicable statutes. Parties cannot by agreement give jurisdiction to a court that inherently lacks it (territorial, pecuniary, or subject matter). 1 6 . Section 19 of the CPC provides jurisdiction for Suits for compensation for wrongs to person or movables.—Where a suit is for compensation for wrong done to the person or to movable property, if the wrong was done within the local limits of the jurisdiction of one Court and the defendant resides, or carries on business, or personally works for gain, within the local limits of the jurisdiction of another Court, the suit may be instituted at the option of the plaintiff in either of the said Courts. 17. Section 20 of the CPC provides jurisdiction for Other suits to be instituted where defendants reside or cause of action arises. Subject to the limitations aforesaid, every suit shall be instituted in a 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 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 works for gain, as aforesaid, acquiesce in such institution; or (c) The cause of action, wholly or in part, arises. [Explanation]. —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 Signature Not Verified Signed by: MANVENDRA SINGH PARIHAR Signing time: 02-04-2026 11:24:20 NEUTRAL CITATION NO. 2026:MPHC-JBP:25581 8 MP-5797-2024 arising at any place where it has also a subordinate office, at such place. 18. The petitioner/defendant company has filed a power of attorney along with the written statement, namely Deed Ex. A8, executed on 5 February 2018, wherein it is stated that ITC Limited, a company incorporated in India and having its registered office at Virginia House, 37, Jawaharlal Nehru Road, Kolkata, West Bengal, nominated, constituted, and appointed Mr. Rajendra Kumar Singhi as its true and lawful Attorney, Representative, and Agent in and outside India for the purposes mentioned in the Deed, thereby conferring upon him the necessary powers and authority. By virtue of the said power of attorney, Mr. Rajendra Kumar Singhi further nominated Mr. Ashit Kumar, son of Late Shravan Kumar, working as Vice President – Finance & MIS, Agri Business Division, ITC Limited, Guntur (hereinafter referred to as ‘the Attorney’), to act as the true and lawful Attorney, Representative, and Agent of the Company, in its name and on its behalf, for exercising the powers granted under the said deed in India. However, the said power of attorney does not clearly establish that the respondent company and the Agri Business Division, ITC Limited, Guntur, are subordinate entities of the respondent. 19. Under Section 20(c) of the Code of Civil Procedure, the Explanation provides that 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 a subordinate office, at such place. In the present case, there is no evidence to show that the respondents have a subordinate office at Guntur. Therefore, the courts at Guntur do not presently Signature Not Verified Signed by: MANVENDRA SINGH PARIHAR Signing time: 02-04-2026 11:24:20 NEUTRAL CITATION NO. 2026:MPHC-JBP:25581 9 MP-5797-2024 have jurisdiction over the subject matter of the suit. Mere reference to Guntur does not oust the jurisdiction of other competent courts, including those at Bhopal, especially where jurisdiction has been agreed upon by the parties. Whether the respondent company has a subordinate office at Guntur is a matter of evidence. Such an objection may be raised in the written statement and must be established by cogent evidence at the appropriate stage. At the preliminary stage, in the absence of evidence, it cannot be determined that the Guntur court has jurisdiction over the subject matter of the suit. 20. From the above, it appears that the principal place of business of a corporation is the place where its governing power is exercised, or where its chief executive offices are located, commonly referred to as the ‘nerve centre’, or the place designated as its principal place of business under the relevant statutes of incorporation. Therefore, in order to determine the principal place of business, the parties are required to place relevant material before the Court. The Court cannot arrive at such a finding at the preliminary stage of the suit merely on the basis of a power of attorney. In the present case, the defendants have not placed any material before the Court, except the power of attorney, to establish that the courts at Bhopal constitute another available forum which is clearly or distinctly more appropriate. The Commercial Court has taken into consideration that the action initiated by the plaintiff-respondent in the Bhopal Court is founded on facts that are real and substantially connected with that forum, particularly in terms of convenience, expense, availability of witnesses, and the law governing the Signature Not Verified Signed by: MANVENDRA SINGH PARIHAR Signing time: 02-04-2026 11:24:20 NEUTRAL CITATION NO. 2026:MPHC-JBP:25581 10 MP-5797-2024 transaction. Further, there is no averment in the application filed by the defendant that continuation of the proceedings in the Bhopal Court would cause injustice to them, or that it is oppressive, vexatious, or an abuse of the process of the Court. There is also no material on record to demonstrate how trial at Guntur would be more convenient to the parties, as compared to trial at Bhopal, or that justice could be achieved with substantially less inconvenience and expense. In the facts and circumstances of the case, we are not satisfied that the Guntur Court has jurisdiction or that the matter can be more appropriately tried there in the interest of all parties and in furtherance of the ends of justice. 21. The objections regarding non-disclosure of cause of action and non-filing of the statement of truth are found to be without substance, particularly in view of the subsequent compliance. No evidence has been placed before the trial court to establish that the Guntur Court has jurisdiction over the subject matter of the suit, especially when the courts at Bhopal otherwise have jurisdiction. Therefore, the agreement between the parties cannot oust the jurisdiction of the Bhopal Court. We find no error in the impugned order. Accordingly, the writ petition deserves to be dismissed and is hereby dismissed. There shall be no order as to costs. (VIVEK RUSIA) (PRADEEP MITTAL) JUDGE JUDGE MSP Signature Not Verified Signed by: MANVENDRA SINGH PARIHAR Signing time: 02-04-2026 11:24:20</div>