The Delhi High Court has dismissed a petition filed under Article 227 of the Constitution challenging the trial court’s refusal to reject a commercial suit for lack of territorial jurisdiction, holding that the defendants’ application under Order VII Rule 11 CPC was frivolous and intended to delay proceedings.
The petition arose from a commercial suit instituted by M/s Mahashian Di Hatti Pvt. Ltd. (MDH) for recovery of ₹44.88 lakh from M/s Shree Balajee Enterprises, alleging non-payment of dues for the supply of spices in April 2022. The defendants sought rejection of the plaint on the ground that no part of the cause of action arose in Delhi, contending that goods were dispatched from Faridabad, and not from the plaintiff’s registered office in Kirti Nagar, New Delhi.
The Trial Court noted that the defendants had admitted in their written statement that MDH’s registered office was in Delhi and that payments were made into its State Bank of India account at Kirti Nagar. Relying on those admissions, the trial court held that part of the cause of action arose in Delhi and that the issue of jurisdiction would be decided at trial.
Aggrieved, the defendants approached the Delhi High Court under Article 227 of the Constitution. The High Court, however, found no infirmity in the trial court’s reasoning and dismissed the petition.
The High Court observed that even if the defendants’ contention regarding jurisdiction were accepted, the appropriate course would be to return the plaint under Order VII Rule 10 CPC, not reject it. Since the trial was already at its final stage, the court found no justification for entertaining a belated application for rejection. Referring to the Supreme Court’s ruling in Bhagya Estate Benchers Pvt. Ltd. v. Narne Estates Pvt. Ltd. Civil Appeal No.4570 of 2023, the court emphasised that Order VII Rule 11 applications filed at an advanced stage of trial defeat the provision’s purpose and waste judicial resources.
Justice Kathpalia also noted that the defendants had filed a counterclaim in the same suit despite questioning the Delhi court’s jurisdiction, indicating that the plea was raised only to delay adjudication. Finding the petition “devoid of merit and filed with oblique purposes,” the court dismissed it with costs of ₹25,000 to be paid to MDH within a week.
Appearances
Petitioners- Mr. Nilkamal Chobey, Advocate.
Respondent- Mr. Ojasvi Annadi Shambhu, Advocate.
