'Mere Presence of Corporate Office Not an Integral Part of Cause of Action': Calcutta High Court Dismisses Writ Petition on Jurisdiction Grounds
Safiya Malik
The Calcutta High Court, in a judgment, dismissed a writ petition challenging summons and notices issued by the Regional Provident Fund Commissioner-II, Hubballi, Karnataka, citing lack of territorial jurisdiction. The petition was heard by Justice Shampa Dutt (Paul), who stated that the cause of action wholly arose in Karnataka, and hence, the petitioners must approach the appropriate court in that jurisdiction.
The case involved Jeju Metals Private Limited and another party, who filed a writ petition challenging a summons dated June 18, 2024, and a notice dated March 14, 2023, issued by the Regional Provident Fund Commissioner-II, Hubballi, Karnataka. The petitioners contended that these notices were invalid due to the lack of territorial jurisdiction and sought their cancellation.
The petitioners, engaged in manufacturing activities, maintained their registered office in Kolkata while their manufacturing plant was located in Dharwad, Karnataka. They contended that since their corporate office was in Kolkata, the Calcutta High Court had jurisdiction over the dispute. The legal representatives for the petitioners relied on the judgment in D.R.M. Steel Industries Private Ltd. v. Board for Industrial and Financial Reconstruction & Ors., arguing that it supported their claim regarding jurisdiction.
The Provident Fund (P.F.) authorities, represented by their legal counsel, countered that the entire cause of action arose in Karnataka, where the employees worked, wages were paid, and disputes arose. They cited Supreme Court precedents, particularly State of Rajasthan & Ors. v. M/s. Swaika Properties & Anr., and M/s. Kusum Ingots and Alloys Ltd. v. Union of India & Anr., to assert that a mere presence of an office in Kolkata was insufficient to establish jurisdiction.
The P.F. authorities further contended that the dispute regarding salaries and wages had been deliberated upon in Karnataka before the Deputy Labour Commissioner, Belgaum. Since the issue was rooted in employment law and related to workers employed in Dharwad, Karnataka, it was argued that the Calcutta High Court lacked the territorial authority to intervene.
Justice Shampa Dutt (Paul) examined whether any part of the cause of action arose within the jurisdiction of the Calcutta High Court. The court relied on various judgments, including the Supreme Court’s judgement in State of Goa v. Summit Online Trade Solutions Private Limited & Ors. and stated that “while dealing with an objection as to lack of territorial jurisdiction, a High Court must arrive at a conclusion based on the averments made in the petition memo, treating the contents as true and correct.”
The judgment further referenced M/s. Kusum Ingots and Alloys Ltd. v. Union of India & Anr., stating that “the power conferred by clause (1) of Article 226 to issue directions, orders, or writs may also be exercised by any High Court within whose jurisdiction the cause of action, wholly or in part, arises.” However, the court observed that the petitioners failed to establish any such cause of action within the jurisdiction of the Calcutta High Court.
Examining the facts, the court noted:
- The summons dated June 18, 2024, and the notice dated March 14, 2023, were issued by the Regional Provident Fund Commissioner-II, Hubballi, Karnataka.
- The petitioners' manufacturing plant was situated in Dharwad, Karnataka
- The dispute regarding payment of wages was deliberated in Karnataka, involving local labour authorities.
- The employees and workers affected by the dispute were engaged in the Karnataka-based plant.
- All respondents in the case were located within Karnataka.
Given these observations, the court recorded that “merely maintaining a corporate office in Kolkata does not constitute an integral part of the cause of action so as to invoke the jurisdiction of the Calcutta High Court.” The court upheld the Supreme Court’s stance in National Textile Corporation Ltd. v. Haribox Swalram, which stated that “the mere fact that a business entity carries on operations from a particular location does not grant jurisdiction to a High Court unless the cause of action also arises there.”
After examining the submissions and legal precedents, the court stated as follows:
- “The writ petition is thus dismissed for want of jurisdiction with liberty to the petitioners to pursue their case before the appropriate court having jurisdiction.”
- “The summons and notice challenged herein are in accordance with law, as the issuing authority has jurisdiction.”
- “All connected applications, if any, stand disposed of.”
- “Interim order, if any, stands vacated.”
The court stated that the petitioners had the right to seek appropriate legal remedies in Karnataka and that the dismissal was solely on jurisdictional grounds, without addressing the merits of the case.
Advocates Representing the Parties
For the Petitioners: Advocates Mr. Moti Sagar Tiwari and Ms. S. Poddar.
For the Respondent: Advocate Mr. Mihir Kundu.
Case Title: Jeju Metals Private Limited & Anr. v. Union of India & Anr.
Case Number: WPA 16838 of 2024 with CAN 1 of 2025
Bench: Justice Shampa Dutt (Paul)
[Read/Download order]
