BEACON PHARMACEUTICAL Vs. DUNI CHAND KHOSLA AND SONS

JUDGEMENT

(1.) THE only issue that arises for determination in this civil revision is whether by virtue of the subsisting contract between the parties, the jurisdiction of the Civil courts at Jullundur has been lawfully excluded. The petitioner-firm styled as beacon Pharmaceuticals carries on business at 135/136 Andheri Kurla Road, bombay-69. The said firm appointed Messrs Duni Chand Khosla and Sons, the respondent-firm as their sole selling agents for their products on the terms and conditions contained specifically in the agreement Exhibit P-5 dated March 1, 1966 for a period of three years. On expiry of the abovesaid period a further agreement dated April 30, 1969 was agreed upon which renewed the earlier contract for a period of three years on the old terms and conditions vide Exhibit P-6. Disputes having arisen over the accounts, partnership-firm of Messrs Duni Chand Khosla and sons brought a suit for rendition of accounts in the Court of Shri Amjad Ali khan. Sub-Judge 1st class, Jullundur. It was averred on their behalf that they had performed their part of the agreement between the two firms diligently and to the best of their ability, but to their utter surprise and astonishment the sole distributorship granted to them by the petitioner-defendants was terminated by them with effect from January 1, 1970, by a letter dated December 31, 1969. It was further alleged that according to the terms of the agreement between the parties, the petitioner-defendant firm was receiving direct orders from the consumers of the sole agency territory of the plaintiff-respondent and was supplying the product directly against the same. It was alleged regarding these transactions that the defendant-petitioner were bound to render the accounts to the plaintiff-respondent from March 1, 1966 from which date no accounts had been rendered by them.

(2.) IN the written statement filed on behalf of the defendant-petitioner, it was expressly pleaded that the Court at Jullundur had no territorial jurisdiction because vide clause 12 of the agreement, the same had been excluded and all disputes arising out of the agreement were subject to the jurisdiction of the Courts within the state of Maharashtra. On the above said pleadings the trial court framed the following issue:--"whether this Court has jurisdiction to proceed with the trial of this case?"

(3.) EVIDENCE was led by the parties and the Court took the view that acceptance of the proposal conveyed through letters Exhibits P-5 and P-6 by the plaintiff-respondent firm had taken place at Jullundur and it was thereafter that these were duly despatched by post to Bombay for delivery to the defendant-petitioners. Adverting to clause 12 of Exhibits P-5 and P-6, the trial Court, however, took the view that this clause giving jurisdiction to the Courts of Maharashtra for the settlement of disputes under the contract was too vague and was unenforceable on that score. It, therefore, held the same to be invalid and consequently took the view that in spite of its existence, the Jurisdiction of the Court at Jullundur was not excluded. The preliminary issue was decided in favour of the plaintiff-respondent and against the defendant-petitioner and consequently the present revision is at the instance of defendant-petitioner.