INDIAN OVERSEAS BANK, MADRAS versus CHEMICAL CONSTRUCTION COMPANY & ORS

Citation: [1979] 3 S.C.R. 920 · Decided: 03-05-1979 · Supreme Court of India · Bench: R.S. SARKARIA · Disposal: Case Allowed

Judgment (excerpt)

A 
B 
INDIAN OVERSEAS BANK, MADRAS 
CHEMICAL CONstRUCTION COMPANY & ORS. 
May 3, 1979 
[R, S. SARKARIA AND D. A. DESAI, JJ.] 
Code of Civil Procedurt, 1908-S. 25 as amended in 1976-Scope r~f-­
Jurisdiction of Supreme Court to transfer d suit from one court to arwt11«'-
Explai11ed. 
The first respondent entered into a contract with the second respondent for 
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the erection of a factory in a place named Seoni in Madhya Pradesh. Under the 
Scheme for re-discounting of bills, the first respondent discounted with its Banker 
(petitioner), the Bills of Exchange in respect of sale of machinery. When the 
second respondent failed to honour the Bills, the drawees of the Bills filed a suit 
in the District Court, Seoni against the petitioner Bank and others seeking certaia 
reliefs. The petitioner-Bank on the other hand filed a suit in the Madras High 
Court against the first respondent and others. In a petition under s. 25 of the 
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Code of Civil Procedure, 1908 (as amended in 1976) the petitioDfr sought ti'lllll-
fer of the suit filed in Seoni to the file of the Madras High Court. 
Allowing the petition, 
HELD : 1. Section 25 of the Code of Civil Procedure as amended in 1916 
empowers the Supreme Court to direct that any suit, appeal or other proceeding 
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be transferred from a High Court or other Civil Court in one State to a High 
Court or other Civil Court in any other State, if it· is satisfied that such an order 
ls expedient in the ends of justice. [925A) 
2. The principle governing the general power of transfer and withdrawal 
under s. 24 of the Code is that the plaintiff is the dominus litis and as such 
entitled to institute his suit in any forum which the law allows 
him. The 
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Court should not lightly change that forum and compel him to go to another 
Court with consequent increase in inconvenience and expense of prosecuting 
his suit. The mere balance of convenience in 
favour 
of 
proceedings 
ia 
another Court albeit a material considemtion, may not always 
be 
a 
true 
criterion justifying the transfer. The power of transfer of a civil proceedint; 
to another Court conferred under the new Section 25 C.P.C. on the Supreme 
Court is far wider and so is the amplitude of the expression "expedient in the 
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interests of justice" which furnishes a general guideline 
for the exercise of 
the power. [925E-F] 
B 
3. One of the broad propositions as to what may constitute a ground for 
transfer of a civil suit from one court to another is that where two suits 
raising common questions of facts and law between parties, common to both 
the suits are pending in two different Courts, it is generally in the interests 
of justice to transfer one of these suits to the other forum to be tried 
by 
the same Court with consequent avoidance of multiplicity in the trial of the 
same issues and the risk of conflicting decisions thereon. [925H] 
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OV!lSUS J4NIC v. CHIWIUL COII!TJ.UCTX>N CO. :Sarkarla, 1.) 921-
• • -4. Ia tht illltta.at Clti, • COiDJ&rativ• atudy ct tho -.uc. ~ 
ia the 
two suita lboWI dlat the principal common queatioll ariJina in c:a.ch of theM 
suits is whether the a«<nd re$pondent and the fourth respondent were bonnd 
to make payment!!. The m:tivinl patty in both the tuitt 'ffii the "'titioner. 
Acoordin1 to the .nteationa in the petition, the Billl of Exchanae were drawn 
in Madra, an ddiscounted in lfadrae and al80 rediscounted with the Indw· 
trial Bank end payments were to be made expressly in Madru. Both tho 
parties were the aame .nd the material issuea in both ot them were common 
or inter·depende11.t. It the two euifa ue allowed to continue in their origillal 
forums, there is a pos!ibility of c:on11.ictina findings on tho question of liabi· 
Iity. The evidel'lce in both the euits would m011tly bo common and is locally 
available at Madras. Transfer of the Seoni enit to tho Madral! High Court 
will avoid multiplicity in the Trial of the common iS!ues and obviate the ri!k 
of conilictinr deci!ioru. In the circ\IIMtances it is manifestly expedient, in the 
interests of justice that both the euits mould be tried by the Madraa Hiah 
Court on itl!l ori;inal side by the same Judge or Judge•. [926C·F] 
5. The second respondent's apprehenaion that the tranafer of the 
Seoni 
auit to Madras would cause an increa,e in expenses of litigation and incon· 
venience to them is not well founded. 
Both the suits are more or leS8 at 
the same etaae.

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