Hakam Singh vs M/S Gammon (India) Ltd.
1971 AIR 740, 1971 SCC (1) 286
Coram: Hon’ble Former Chief Justice J.C. Shah & Hon’ble Justice K.S. Hegde
Forum: Hon'ble Supreme Court of India
Case No.: Civil Appeal No. 646 of 1967
Date of decision: January 8, 1971

Facts:

  • The Appellant was Hakam Singh, who worked in the field of construction.
  • The Respondent M/S Gammon (India) Ltd., was a company registered under the Indian Companies Act, and its principal office in Bombay.
  • The Appellant agreed to perform certain construction work for the Respondent based on the terms and conditions of a written tender.
  • The contract had a clause that all the disputes would be adjudicated solely in Bombay, regardless of where the work was executed.
  • The Appellant filed the case before the Trial court at Varanasi under Section 20 of the Arbitration Act, 1940, however, the trial court ruled jurisdiction cannot be conferred in Bombay by agreement alone.
  • The Respondent appealed to the High Court of Allahabad, which overturned the Subordinate Court's order.
  • Hence, the appeal was raised before the present court against the order of the Allahabad High Court.

Background/Procedural Posture


Trial Court Holding – Varanasi

  • The case was first filed before the Court of the Subordinate Judge at Varanasi.
  • The Trial Judge rejected the Respondent's jurisdictional claim based on Clause 13 of the agreement, stating that the cause of action arose in Varanasi, thus jurisdiction could not be conferred on Bombay courts solely through agreement. (Page 3)


Allahabad High Court Holding

  • The matter was appealed before the High Court of Allahabad by the Respondent. The High Court set aside the order of the Subordinate Judge and declared that the Courts in Bombay had jurisdiction under general law to entertain the petition.
  • The High Court held that Clause 13 was binding, establishing exclusive jurisdiction in Bombay, and precluding the Varanasi court from entertaining the arbitration petition. (Page 3)
  • Aggrieved by the decision of the High Court, the Appellant filed an appeal before the Supreme Court by special leave.


Main issue:

  1. Whether the courts in Bombay exclusively have jurisdiction over the dispute?
  2. Whether explanation 11 to Section 2(a) of the Code of Civil Procedure, 1908, refers only to government corporations and not to companies registered under the Indian Companies Act? (Page 2)