Delhi High Court: In an application filed under Order 7 Rule 10, Civil Procedure Code, 1908 (CPC), seeking return of the plaint on the ground that the Delhi High Court lacked territorial jurisdiction to entertain the suit, the Single Judge Bench of Subramonium Prasad, J., allowed the application and directed return of the plaint, holding that the stipulation “Subject to Meerut Jurisdiction” in the invoice, in the absence of the words “only”, “alone” or “exclusive”, was sufficient to exclude the jurisdiction of other competent courts.
Background
The plaintiff was a jeweller carrying on the business of trading and manufacturing gold ornaments through his proprietorship concern at City Sarafa, Ghantaghar, Meerut, Uttar Pradesh. The dispute arose out of a longstanding commercial relationship between the parties extending for approximately 10—12 years, during which the parties dealt in gold and jewellery based on mutual trust and approval/credit arrangements.
In January 2024, the defendants obtained approximately 640 grams of 24-karat fine gold, valued at about ₹40,96,000, from the plaintiff on approval basis, undertaking either to return the gold or make payment within 1 month. The plaintiff alleged that neither payment nor return was made within the stipulated period. In March 2024, notwithstanding the earlier default, the defendants again obtained 551 grams of 24-karat fine gold, assuring the plaintiff that the entire quantity of 1191 grams would be returned along with interest at 5 per cent per month and that the earlier outstanding dues would also be cleared.
In October 2024, relying upon representations concerning an expected large customer order, the plaintiff supplied 3185 grams of 18-karat gold ornaments on 14 October 2024, against an invoice of ₹2,00,52,295, followed by another supply of 1836 grams on 16 October 2024, against an invoice of ₹1,15,64,325. The defendants allegedly failed to make payment and thereafter stopped responding to the plaintiff’s calls and messages, resulting in repeated visits by the plaintiff to their Delhi premises for recovery of the outstanding amounts.
In March 2025, the defendants supplied jewellery worth approximately ₹1.79 crores, which was represented as a partial settlement of the outstanding dues. Subsequently, on 2 April 2025, the defendants requested further supply of fine gold on behalf of Alia Jewellers. Acting upon the representations made, the plaintiff supplied a TT gold bar weighing 2109 grams on 3 April 2025, against an invoice of ₹1,97,29,917, which was signed by Defendant 1.
As an assurance of repayment, Defendant 1 allegedly handed over 2 cheques of ₹5,00,000 each. The cheques were deposited on 12 April 2025 but were dishonoured on 14 April 2025. Thereafter, the defendants denied having received the fine gold supplied in January and March 2024 and relied upon allegedly manipulated books, bills and transaction records to dispute their liability.
The plaintiff subsequently lodged a complaint, pursuant to which FIR was registered at Police Station Civil Lines, Meerut, concerning allegations of cheating, criminal breach of trust and forgery. The plaintiff further alleged that, following registration of the FIR, the defendants began attempting to alienate their assets so as to defeat his claim.
The present commercial suit was thereafter instituted seeking recovery of the outstanding amount, return of 1191 grams of fine gold with interest, compensation and damages, besides protective and permanent injunctions against alienation of the defendants’ assets. However, the defendants file the present application under Order 7 Rule 10 CPC for return of the plaint on the ground that the Court had no territorial jurisdiction.
Issues for Determination
Whether the jurisdiction clause appearing on the invoices “Subject to Meerut Jurisdiction” excluded the jurisdiction of the Delhi Courts?
Analysis
At the outset, the Court reiterated the settled distinction between territorial/pecuniary jurisdiction and jurisdiction over the subject-matter. Relying on Harshad Chiman Lal Modi v. DLF Universal Ltd., (2005) 7 SCC 791, the Court observed that an objection to territorial or pecuniary jurisdiction must be raised at the earliest possible opportunity and, in any event, at or before settlement of issues. Subject-matter jurisdiction stands on a different footing, and an order passed by a court lacking jurisdiction over the subject-matter is a nullity.
Since the defendants had raised the objection to territorial jurisdiction at the first opportunity, the Court proceeded to examine the application on merits.
The Court also considered the settled principle that where 2 or more courts possess jurisdiction, parties may, by agreement, restrict the jurisdiction to one of those courts. Relying on EXL Careers v. Frankfinn Aviation Services (P) Ltd., (2020) 12 SCC 667, the Court reiterated that parties may confer exclusive jurisdiction upon one competent court by consent.
The Court also relied on Swastik Gases (P) Ltd. v. Indian Oil Corpn. Ltd., (2013) 9 SCC 32, wherein the Supreme Court had held that the absence of words such as “alone”, “only”, “exclusive” or “exclusive jurisdiction” is not decisive. Where the intention of the parties is clear and unambiguous that courts at a particular place shall have jurisdiction, the words may be understood as conferring jurisdiction upon those courts alone. The principle of expressio unius est exclusio alterius, i.e., expression of one is the exclusion of another, may therefore apply. The Court had emphasising that where a contract specifies the jurisdiction of courts at a particular place and those courts otherwise possess jurisdiction to deal with the matter, an inference may be drawn that the parties intended to exclude all other courts. Such a clause, is not hit by Section 23 or Section 28, Contract Act, 1872.
The Court distinguished the plaintiff’s reliance on A.B.C. Laminart (P) Ltd. v. A.P. Agencies, (1989) 2 SCC 163, as in light of subsequent Supreme Court decisions, it did not assist the plaintiff. The Court held that, in view of the later law, the presence or absence of the words “only”, “exclusive”, etc. is not decisive.
Applying the above discussed principles, the Court found that the invoices had been raised in Meerut and specifically provided that disputes would be Subject to Meerut Jurisdiction. The defendants had also accepted the goods subject to that stipulation. Therefore, the Court opined that the clause clearly excluded the jurisdiction of the Delhi High Court.
Consequently, the Court held that the matter was squarely covered by the aforementioned precedents and that the plaintiff could not avoid the effect of the jurisdiction clause merely because the invoice did not employ expressions such as “only” or “exclusive”.
Decision
The Court allowed the application under Order 7 Rule 10 CPC and directed that the plaint be returned to the plaintiff, with the liberty to institute the suit before the Court of competent jurisdiction. The suit and pending applications were accordingly disposed of.
The Court clarified that it had not made any observations on the merits of the case and confined the decision to the question of territorial jurisdiction and did not adjudicate on plaintiff’s substantive claims concerning recovery, gold transactions, alleged dishonour of cheques, or the allegations forming the subject-matter of the underlying dispute.
[Vikrant Kapoor v. Anuj Kohli, 2026 SCC OnLine Del 6866, decided on 31-8-2026]
Advocates who appeared in this case:
For the Defendants: Mr. Pulkit Thareja and Mr. Sumukh Valimbe, Advs.
