Aapka Consultant Judgment Series- In this series, we are providing case analysis of Landmark Judgments of Hon’ble Supreme Court of India.
M/S. Kusum Ingots & Alloys Ltd. v. Union of India and Anr.
AIR 2004 SC 2321,  6 SCC 254
JUDGE: S.B. Sinha and S.H. Kapadia
Date of Decision: 28-04-2004
This appeal arises out of the judgment passed by the High Court of Delhi, dismissing the writ petition on the ground of lack of territorial jurisdiction. The appellant company, incorporated in Mumbai, was issued a notice by the respondent for repayment of the bank loan from Bhopal Branch in terms of the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. In pursuant to Article 226 of the Constitution, appellant filed a writ petition questioning the vires of the said act in High Court, Delhi. The petition was rejected on the ground that no cause of action arosed within territorial jurisdiction of the High Court, Delhi.
- Whether the seat of the Parliament or the Legislature of a State would be a relevant factor for determining the territorial jurisdiction of a High Court to entertain a writ petition under Article 226 of the Constitution of India.
- Whether a writ petition to challenge of the seat of Parliament or Legislature can be entertained?
- Whether a Writ Petition is maintainable without any Cause of Action?
It was submitted by the appellants that the writ filed before the High Court, Delhi is for questioning the constitutionality of a Parliamentary Act and had requisite jurisdiction to entertain the petition. But the respondent resisted the averment of appellant stating no cause of action arosed within the jurisdiction of High Court, Delhi.
In adjudging above issues, the Supreme Court discussed the provisions of Article 226, S. 20 (c) of CPC. Although, cause of action is not defined in any statute but for the purpose of Article 226, it has been be assigned the same meaning as envisaged under Section 20(c) of the Code. It means facts pleaded should be material facts whereupon a writ petition can be allowed.
The Supreme Court also clearly held the view that to determine the jurisdiction of the court vis-a-vis facts averred in the writ petition must have a nexus on the basis whereof a prayer can be granted. Thus it is clears that no writ is maintainable without factual cause of action. When a part of the cause of action arises within one or the other High Court jurisdiction, it will be for the petitioner to choose his forum.
As to questioning on the constitutionality of a Parliament, the Supreme Court ruled that passing of legislation by itself do not confer any such right to file a writ petition unless a cause of action arises, therefore. An order passed on writ petition questioning the constitutionality of a Parliamentary Act, whether interim or final, keeping in view the provisions contained in Clause (2) of Article 226 of the Constitution, will have effect throughout the territory of India subject of course to the applicability of the Act. However, the Court may refuse to exercise its discretionary jurisdiction by invoking the doctrine of forum conveniens to decide the matter on merit.
From the compilation of relevant legislations observed in cases Oil Natural Gas Commission v. Utpal Kumar Basu and Ors. [1994 (4) SCC 711], National Textile Corp. Ltd. and Ors. v. M/s Haribox Swalram and Ors. [JT 2004 (4) SC 508)], it appears that facts averred by the petitioner-appellant, would not constitute a material, essential, or integral part of the cause of action, that one has to consider.
Thus, for the aforementioned reasons, Supreme Court dismissed the appeal.
Hence held the jurisdiction of High Court to entertain any writ petition is grounded on the place of accrual of the cause of action. The place of the Parliament Legislature is irrelevant.
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