Jurisdiction of Immovable Property Predominates: Supreme Court Upholds Sehore Court’s Jurisdiction

In a significant ruling, the Supreme Court addressed the jurisdictional aspect of civil suits related to immovable property, particularly in cases involving specific performance of agreements. The court deliberated upon the applicability of Sections 16 and 20 of the Code of Civil Procedure (CPC) in determining the competent court for a dispute over a Memorandum of Understanding (MoU) regarding land purchase.

M/S ACME Papers Ltd. Sought the transfer of a suit filed by M/S. Chintaman Developers Pvt. Ltd. For specific performance of an MoU from Sehore, Madhya Pradesh, to Calcutta, West Bengal. ACME Papers, unable to obtain approvals for selling the land, claimed the MoU stood terminated. In response, Chintaman Developers filed a suit in Sehore, while ACME filed a counter-suit in Calcutta, leading to the transfer petitions.

The Supreme Court thoroughly examined the principles of jurisdiction under the CPC. The court noted, “jurisdiction for suits concerning immovable property is primarily determined by the location of the property as per Section 16, CPC.” It was clarified that the place of execution of the agreement or the residence of the parties is secondary, making Section 20 a residuary provision not applicable in this case.

Regarding the precedence of filing, the Court invoked Section 10, CPC, emphasizing the need to avoid multiple proceedings on similar issues. It was observed that the Sehore suit was filed earlier, thereby necessitating a stay on the Calcutta suit as per the principles laid down in ‘Gupte Cardiac Care Centre and Hospital v. Olympic Pharma Care (P) Ltd.’

Decision: The Court dismissed Transfer Petition (C) No.2664 of 2023, maintaining the jurisdiction of the Sehore court. Concurrently, it allowed Transfer Petition (C) No.499 of 2024, transferring the Calcutta suit to Sehore for consolidated proceedings. The Court also provided the petitioner with the option to withdraw the transferred suit or file a counterclaim in Sehore.

Date of Decision: March 22, 2024

M/S ACME Papers Ltd. Vs M/S. Chintaman Developers Pvt. Ltd. & Ors.