Establishment Of Kolhapur Circuit Bench Does Not Automatically Divest Principal Seat Of Jurisdiction When Appellate Authority Falls Within Its Territory: Bombay High Court
Isabella Mariam
The Bombay High Court Division Bench of Justice Manish Pitale and Justice Shreeram V. Shirsat held that the establishment of the Circuit Bench at Kolhapur does not strip the Principal Seat at Mumbai of its jurisdiction to hear a writ petition where both the original and appellate authorities are situated within its territorial limits. The Court, hearing a challenge to an order of the Debt Recovery Appellate Tribunal by a proprietorship firm aggrieved by securitisation proceedings, found that the appellate authority's order forms a substantial part of the cause of action, thereby preserving the Principal Seat's jurisdiction regardless of Rule 3A of the Bombay High Court Appellate Side Rules.
The petitioners, a proprietary firm and associated parties, had availed credit facilities from a cooperative bank and secured the loan by mortgaging certain properties. Subsequently, the loan account was classified as a non-performing asset, following which recovery proceedings were initiated under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The petitioners challenged certain steps taken in the recovery process and approached the Debts Recovery Tribunal at Pune by filing a securitisation application. During those proceedings, interlocutory applications were decided by the Tribunal on 22.02.2023, whereby a sale certificate issued in favour of a third party was set aside and directions were issued to retain custody of movable assets and commence the sale process afresh.
Aggrieved by that order, the concerned respondent filed appeals before the Debts Recovery Appellate Tribunal at Mumbai. By an order dated 19.09.2024, the Appellate Tribunal remanded the matters back to the Debts Recovery Tribunal for fresh consideration, recording that the earlier order of the Tribunal was a non-speaking order. The petitioners thereafter filed the present writ petition challenging the appellate order. While the writ petition was pending, a notification dated 01.08.2025 established a Circuit Bench of the High Court at Kolhapur. The petitioners contended that since the cause of action arose in District Kolhapur, the writ petition ought to be transferred to the newly established Circuit Bench under Rule 3A of the Bombay High Court Appellate Side Rules. The respondents opposed the request, asserting that the Principal Seat at Mumbai retained jurisdiction because both the Debts Recovery Tribunal at Pune and the Debts Recovery Appellate Tribunal at Mumbai were situated within its territorial jurisdiction.
The Court examined the submissions relating to territorial jurisdiction and the effect of establishing the Circuit Bench at Kolhapur. The Bench recorded that the petitioners’ argument was based on the proposition that the establishment of the new bench and the amendment introducing Rule 3A completely divested the Principal Seat at Mumbai of jurisdiction.
The Court observed that “a perusal of the prayer clause shows that the petitioners have invoked the writ of certiorari against the order of the Appellate Authority i.e. the DRAT. It is undisputed that the DRAT is located in Mumbai. It is also undisputed that the Original Authority in the present case i.e. the DRT is located in Pune.” It further recorded that “both, the DRT i.e. the Original Authority and DRAT i.e. the Appellate Authority, are within the jurisdiction of the Principal Seat of this High Court.”
Considering precedent on territorial jurisdiction, the Court referred to the principle relating to cause of action. It noted that “the fact that order is passed by the appellate or revisional authority within the territorial jurisdiction of a particular Bench of the High Court is a relevant factor, and that, part of the cause of action clearly arises within the territorial jurisdiction of the Bench wherein the appellate or revisional authority is located.”
The Bench also recorded the settled position that appellate orders form part of the cause of action. Referring to established jurisprudence, the Court noted that “when an order… is passed by a court or tribunal or an executive authority… a part of cause of action arises at that place.” It further stated that “even in a given case, when the original authority is constituted at one place and the appellate authority is constituted at another, a writ petition would be maintainable at both the places.”
The Court also examined the doctrine of merger and the effect of appellate orders. It recorded that “the order of the appellate authority constitutes a part of the cause of action… and since the original order merges into the appellate order, the place where the appellate authority is located is also forum convenience.”
Applying these principles to the facts of the case, the Court observed that the establishment of the Kolhapur Circuit Bench did not automatically deprive the Principal Seat of jurisdiction. The Bench recorded that “the contention raised on behalf of the petitioners that with the establishment of the Circuit Bench of this Court at Kolhapur, the Principal Seat of this Court completely lost jurisdiction or that its jurisdiction stood ousted, cannot be accepted.”
The Court further stated that the reliance placed on Rule 3A and certain earlier decisions did not assist the petitioners. It observed that “since the Original Authority in the present case is not located within the territorial jurisdiction of the Circuit Bench at Kolhapur, there is no reason why the observations made in the said judgement can inure to the benefit of the petitioners.”
Finally, the Court recorded that the plea of forum convenience also could not justify transfer of the case. It noted that “only on the ground of forum convenience, it cannot be said that this Principal Seat at Mumbai has lost jurisdiction to further hear and entertain the present writ petition.”
The Court directed that “the contention raised on behalf of the petitioners that with the establishment of the Circuit Bench at Kolhapur and in the light of introduction of Rule 3A of the said Rules, this Principal Seat has lost jurisdiction to entertain the present petition, deserves to be rejected. The contention deserves to be rejected that this petition must necessarily be transferred to the Circuit Bench at Kolhapur. Accordingly, the said contentions are rejected.”
“This writ petition will continue to be heard at the Principal Seat at Mumbai. The writ petition shall be taken up for consideration on 30.03.2026, High on Board,” and that “the interim order shall continue to operate till the next date of listing.”
Advocates Representing the Parties
For the Petitioners: Ms. Ayodhya Patki a/w Mr. Vallabh Tokekar and Mr. Akash Kotecha
For the Respondents: Mr. Nikhil Rajani a/w Mr. Ajay Deshmane i/b V. Deshpande & Co.; Mr. Darshit Jain a/w Mr. Parth Mehta, Mr. Anurag Kalavatiya and Mr. Udit Raghuwanshi i/b Mr. Bhavesh Joshi
Case Title: M/s. Shekhar Champalal Pagaria Through Proprietor & Ors. v. CFM Assets Reconstruction Pvt. Ltd. & Ors.
Case Number: Writ Petition No.10011 of 2025
Bench: Justice Manish Pitale, Justice Shreeram V. Shirsat
