Exclusive Jurisdiction Clause in Contract Ousts Territorial Jurisdiction of Other Courts Despite Progress of Trial

The Plaintiff and Defendant No. 1 entered into an Agreement for Channel Telecasting and Distribution on 25.04.2018

Disputes arose regarding invoices and outstanding liabilities for the period of April 2018 to March 2019, leading the Plaintiff to file a suit for rendition of accounts and damages

Although the suit reached the stage of recording evidence, the Defendants filed an application under Order VII Rule 11 of the CPC (re-characterized by the Court as Order VII Rule 10) seeking rejection/return of the plaint on the grounds that Clause 15 of the Agreement vested exclusive jurisdiction in the Courts at Hyderabad

1. Whether the Court can entertain an objection regarding territorial jurisdiction at a belated stage (after issues were framed and evidence commenced) when an exclusive jurisdiction clause exists

2. Whether the plaint should be returned under Order VII Rule 10 of the CPC due to the ouster of jurisdiction by contract

The Court primarily applied Order VII Rule 10 of the CPC regarding the return of the plaint

It relied on Kiran Singh v. Chaman Paswan, establishing that a decree by a court without jurisdiction is a nullity

It further applied the principle from Harshad Chiman Lal Modi v. DLF Universal Ltd., which states that while territorial objections should be taken early, they must be upheld if taken at the first instance in the written statement

Finally, the Court applied the doctrine of expressio unius est exclusio alterius as affirmed in Swastik Gases (P) Ltd. v. Indian Oil Corpn. Ltd. and EXL Careers v. Frankfinn Aviation Services (P) Ltd., holding that naming a specific court in a contract implies the exclusion of all other jurisdictions

The Court noted that Clause 15 of the Agreement explicitly stated that jurisdiction "shall always be the courts at Hyderabad"

While the Plaintiff argued that the objection was belated since evidence had begun, the Court found that the Defendants had raised the jurisdictional objection at the earliest opportunity in their written statement, and an issue had been framed accordingly

The Court reasoned that once parties consensusually bestow exclusive jurisdiction on a specific court, that jurisdiction cannot be ignored. Following EXL Careers, the Court determined that even at the evidence stage, the proper course of action for a court lacking jurisdiction is to return the plaint rather than dismiss the suit or proceed to a void judgment

The Court ordered the return of the plaint under Order VII Rule 10 of the CPC to be instituted before the court of competent jurisdiction

It declined to observe which stage the suit should proceed from or whether the Plaintiff is entitled to Section 14 of the Limitation Act, leaving those determinations to the competent court in Hyderabad