SETH HIRALAL PATNI versus SRI KALI NATH

Citation: [1962] 2 S.C.R. 747 · Decided: 04-05-1961 · Supreme Court of India · Bench: BHUVNESHWAR PRASAD SINHA · Disposal: Dismissed

Cited by 11 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

2 S.C.R. SUPREME COllliT REPOR'l'S 
747 
SETH HIRALAL PATNI 
v. 
SRI KALI NATH 
(B. P. SINHA, C.J., K. SuBBA RAo, 
RAGHUBAR DAYAL and 
J. R. MuDHOLKAR, JJ.) 
Execution Proceeding--Objection 
to 
territorial juri•dic-
tion of court granting decree-IVhw to be ra.ised-Ref<rence to 
arbitration-Decree-IVaiver-Estoppel-LelterB Patent. cl. 12-
C ode of Civil Procedure 1908 (V of 1908). ss. 47, 51. 
The respondent instituted a suit on the Original Side of 
the Bombay High Court against the appellant for the recovery 
of his commission in respect of certain share transactions at 
Agra. The plaint was filed after obtaining leave of the Bom-
bay High Court under cl. 12 of the Letters Patent. One of 
the defences of the appellant, taken in his written statement, 
was that the suit filed was outside the territorial jurisdiction of 
the Bombay High Court Original Side, in as much as the entire 
cause of action, if any, had arisen at Agra. The suit was 
eventually referred to arbitration. 
The arbitrator gave his· 
award in favour of the respondent which was upheld on 
appeal by the High Court. 
T}\e respondent rook out execution proceedings wherein 
the appellant took objection inter alia that the Bombay High 
Court had n:o jurisqiction to ente1tain the suit and to make 
the award -a decree of the coo.rt, as no part of the cause of 
action ever arose withirr the territorial jurisdiction of that court, 
and that therefore all the proceedings following ti)ereupon 
were wholly without jurisdiction. 
Held, that where a party to a suit had agreed to refer 
the matter to arbitration through court he would be deemed 
tO have waived his objection to the territorial jurisdiction of 
the court raised by him in his written statement. 
Held, further, that the question of the correctness of the 
procedure or the order granting leave under cl. 12 of the 
Letters Patent or the waiver of any objection must be raised in 
the proceedings before the High Court and could not be agita· 
ted in execution proceedings. 
The validity of the decree 
could be challenged in execution proceedings only on the 
ground that the court which had passed the decree-was lacking 
in inherent jurisdiction in respect of the subject matter of the 
suit or over the parties to it. 
1961 
May, 4. 
-·---1 
I 
-
I 
1961 
Seth Hiraki! 
Patni 
v. 
S•i Kali Nath 
Sinka O.J. 
748 
SUPREME COURT REPORTS 
[1962] 
In the ;>resent case the appellant was estopped from 
challenging the jurisdiction of the Bombay High Court to 
entertain the suit and to make the reference to the arbitrator; 
and he was equally estopped from challenging the authority of 
the arbitrator to render the award. 
Ledgard v. Bull (1886) L. R. 13 I. A. 134, not appli· 
cable. 
CIVIL APPELLATE JURISDICTION: Civil Appeal 
No 237 of 1958. 
Appeal from the judgment and decree dated 
January 27, 1955, of the Allahabad High Court in 
Execution First Appeal No. 137 of 1954. 
A. V. Viswanatha Sastri, E. Udayarathnarn and 
S. S. Shukla, for the appellant. 
Vidya Sagar, for respondent. 
1961. Mny 4. The Judgment of the Court was 
delivered by 
SINHA C. J.-This appeal, 
on 
a certi-
ficate by the 
High Court 
of judicature 
at 
Allahabad, 
arises in 
execution 
proceedings, 
taken 
by the 
decree 
holder-respondent in 
the 
following 
circumstances. 
The 
appellant 
wished to acquire shares in certain mills, popularly 
known as 'John Mills', at Agra. He engaged the 
services of the respondent to negotiate the deal on 
certain terms. The bargain was concluded, and the 
appellant, together with another person, purchased 
the entire interest of one Major A. U. John by 
an indenture of sale dated July 10, 1946. The res-
pondent instituted a suit, being suit No. 3718of1947, 
on the original side of the High Court of judicature 
at Bombay for recovery of his commission, amount-
ing to one lakh of rupees, in respect of the tran-
saction aforesaid. 
The suit was eventually referred to the arbi-
tration of one Mr. W. E. Pereira, administrator of 
the estate of the aforesaid Major A.U. John, decea-
sed. One of the defences taken by the appellant, as 
2 S.C.R. 
SUPREME COURT REPORTS 
749 
defendant in the action, was that the suit filed in 
the Bombay High Court, as aforesaid, after obtain-
ing leave of that Court, under cl. 12 of the Letters 
Patent .was outside the territorial jurisdiction of the 
Bombay High Court on the original side, in as much 
as the entire cause of action, if any, had arisen at 
Agra. The arbitrator gave an 

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