Incidental presence of GeM in Delhi does not confer territorial jurisdiction absent a material cause of action.

The petitioner participated in GeM Bid No. GEM/2025/B/6487719 floated by Ammunition Factory Khadki, Pune, for 189 monochrome LaserJet printers requiring, inter alia, a composite cartridge with a minimum yield of 3,000 prints. The petitioner’s model was technically qualified, declared L-1 after the reverse auction, and the petitioner supplied the entire consignment.

The buyer rejected the printers on the ground that the cartridges allegedly used separate toner and drum technology. The petitioner disputed the rejection, relied on reports issued by Projects & Development India Limited and Government Polytechnic, Pune, and alleged that the rejection was based on an undisclosed criterion and without functional testing.

The buyer subsequently cancelled the GeM contract on 27 July 2026 and issued a show-cause notice proposing administrative action, including moratorium or debarment from the GeM portal.

The petitioner challenged the cancellation, show-cause notice, and related GeM consequences before the Delhi High Court. The respondents objected that the entire cause of action arose in Pune and that the petitioner had an alternative remedy through arbitration.

1. Whether the Delhi High Court had territorial jurisdiction under Article 226(2) of the Constitution when the impugned contract, supply, inspection, rejection, cancellation order, and show-cause notice were connected with Pune, Maharashtra, while GeM was situated in Delhi.

2. Whether the petition ought to be declined on the principle of forum conveniens, even assuming that some part of the cause of action arose within Delhi.

3. Whether the petitioner’s alternative remedy by way of arbitration affected the maintainability of the writ petition.

Article 226(1) empowers a High Court to issue writs within its territorial jurisdiction, while Article 226(2) permits it to do so where the cause of action arises wholly or partly within that territory.

Every pleaded fact does not constitute a cause of action; the pleaded facts must have a material, essential, or integral nexus with the lis and the relief sought, as held in Union of India v. Adani Exports Ltd., (2002) 1 SCC 567, and Alchemist Ltd. v. State Bank of Sikkim, (2007) 11 SCC 335.

In State of Goa v. Summit Online Trade Solutions (P) Ltd., (2023) 7 SCC 791, the Supreme Court held that the court must examine whether the pleaded facts constitute an integral part of the cause of action and must also consider forum conveniens.

The Full Bench decision in Sterling Agro Industries Ltd. v. Union of India, 2011 SCC OnLine Del 3162, further recognises that a High Court may decline jurisdiction on the principle of forum conveniens even where a minuscule part of the cause of action arises within its territory.

The Court held that the material and integral facts arose in Pune: the bid was floated there, the contract was concluded there, the printers were supplied and inspected there, the consignment was rejected there, and the technical demonstrations and reports relied upon by the petitioner also originated there.

The cancellation order and show-cause notice were issued by authorities situated in Pune and addressed to the petitioner’s Pune office.

Although GeM was located in Delhi, the petitioner itself pleaded that GeM had exercised no oversight, review, or approval over the impugned cancellation. Consequently, the grievances against GeM concerned only incidental omissions and challenges to its internal policies, whereas the primary dispute concerned actions taken by the Pune-based authorities.

Applying the integral-cause-of-action test and the principle of forum conveniens, the Court concluded that no material, essential, or integral part of the cause of action arose in Delhi.

It left open the petitioner’s right to pursue such remedies as may be available before the appropriate forum, including the jurisdictional High Court, in accordance with law. The Court expressly stated that it had not examined the merits of the parties’ rival contentions. The pending application was also dismissed.