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REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL  NO. 1560 OF 2004

Sonic Surgical .... Appellant

Versus

National Insurance Company Ltd. .... Respondent

O R D E R

Heard learned counsel for the parties.

This appeal by special leave has been filed against  

the  order  dated  10th July,  2003  of  the  National  Consumer  

Disputes Redressal Commission, New Delhi (for short 'NCDRC')  

whereby the appeal filed by the respondent herein has been  

allowed  and  the  order  of  the  Consumer  Disputes  Redressal  

Commission Union Territory, Chandigarh has been set aside.   

It appears that there was a fire on 13-14th February,  

1999 at 10.00 p.m. in the godown of the appellant at Ambala.  

For  claiming  compensation,  the  appellant  filed  a  claim  

petition  before  the   Consumer  Commission  of  the  Union  

Territory, Chandigarh constituted under Section 17 of the  

Consumer Protection Act, 1986 (hereinafter for short 'the  

Act').   The  said  claim  petition  filed  by  the  appellant  

herein was allowed by the Consumer Commission of the Union  

Territory,  Chandigarh.   On  appeal,  the  NCDRC  allowed  the

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appeal  of  the  respondent  herein  on  the  ground  that  the  

Consumer  Commission  at  Chandigarh  had  no  jurisdiction  to  

entertain and adjudicate the complaint.  We are in agreement  

with the view taken by the NCDRC.   

In our opinion, no part of the cause of action arose  

at  Chandigarh.   It  is  well  settled  that  the  expression  

'cause of action' means that bundle of facts which gives  

rise  to  a  right  or  liability.   In  the  present  case  

admittedly the fire broke out in the godown of the appellant  

at Ambala.  The insurance policy was also taken at Ambala  

and  the  claim  for  compensation  was  also  made  at  Ambala.  

Thus no part of the cause of action arose in Chandigarh.

One of us  (Hon'ble Mr. Justice Asok Kumar Ganguly)  

while a Judge of the Calcutta High Court in the case of IFB  

Automotive Seating and System Ltd. and Others Vs.  Union of  

India AIR 2003 Calcutta, 80 has dealt with the question as  

to the meaning of the expression 'cause of action'. Placing  

reliance on a decision of this Court in the case of Union of  

India Vs. Adani Exports Ltd. AIR 2002 SC 126, in para 40 of  

the said judgment it has been observed as under :-

“In Adani Exports (AIR 2002 SC 126) (supra) the  

learned  Judges  in  para  13  set  out  the  facts

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pleaded by the petitioner to give rise to cause  

of action conferring territorial jurisdiction on  

the Court at Ahmedabad.  One of the facts pleaded  

is  that  non-granting  and  denial  utilization  of  

the  credit  in  the  pass  book  will  affect  the  

business of the respondents at Ahmedabad.  This  

fact is not pleaded in the case in hand.

Even then the learned Judges held that  

those facts are not sufficient to furnish a cause  

of  action  as  they  are  not  connected  with  the  

relief sought for by the respondents.

Here  also  the  relief  is  against  the  

orders  of  approval  and  this  High  Court  has  no  

territorial  jurisdiction  to  grant  that  relief.  

Therefore, the communication to the effect that  

the petitioners' representation against orders of  

approval is rejected is of no consequence.

The  Supreme  Court,  further  dealing  the  

concept  of  Aritcle  226(2)  and  relying  on  the  

decision of ONGC (1994 AIR SCW 3287), explained  

the concept of cause of action in para 17 at page  

130  of  the  report  and  the  relevant  extracts  

wherefrom are excerpted below :

“It is clear from the above judgment that each  

and  every  fact  pleaded  by  the  respondents  in  

their application does not ipso facto lead to the  

conclusion that those facts give rise to a cause  

of  action  within  the  Court's  territorial  

jurisdiction unless those facts pleaded are such  

which have a nexus or relevance with the lis that

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is involved in the case.  Facts which have no  

bearing with the lis or the dispute involved in  

the case, do not give rise to a cause of action  

so as to confer territorial jurisdiction  on the  

Court concerned.

The learned Judges also held in para 18  

as follows :

“The non-granting and denial of credit in  

the passbook having an ultimate effect, if any,  

on the business of the respondents at Ahmedabad  

would not also, in our opinion, give rise to any  

such cause of action to a Court at Ahmedabad to  

adjudicate on the actions complained against the  

appellants.”   

We respectfully agree with the view taken by the  

Calcutta  High  Court  in  the  aforesaid  decision  of   IFB  

Automotive Seating(supra).  Hence, in our opinion, no part  

of  the  cause  of  action  in  the  present  case  arose  at  

Chandigarh.

Learned counsel for the appellant then invited our  

attention to the amendment brought about in Section 17(2) of  

the Act in the year 2003.  The Amended Section 17(2) of the  

Act reads as under :-

“(2) A complaint shall be instituted in a State  

Commission  within  the  limits  of  whose  

jurisdiction,-

(a) the opposite party or each of the opposite

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parties, where there are more than one, at  

the time of the institution of the complaint,  

actually and voluntarily resides or carries  

on  business  or  has  a  branch  office  or  

personally works for gain; or

(b) any of the opposite parties, where there are  

more than one, at the time of the institution  

of  the  complaint,  actually  and  voluntarily  

resides,  or  carries  on  business  or  has  a  

branch office or personally works for gain,  

provided  that  in  such  case  either  the  

permission of the State Commission is given  

or the opposite parties who do not reside or  

carry on business or have a branch office or  

personally works for gain, as the case may  

be, acquiesce in such institution;

(c) the  cause  of  action,  wholly  or  in  part,  

arises.”

The  aforesaid  amendment  came  into  force  w.e.f.  

15.3.2003 whereas the complaint in the present case has been  

filed in the year 2000 and the cause of action arose in  

1999. Hence, in our opinion, the amended section will have  

no application to the case at hand.

Moreover,  even  if  it  had  application,  in  our  

opinion,  that  will  not  help  the  case  of  the  appellant.  

Learned  counsel  for  the  appellant  submitted  that  the  

respondent-insurance  company  has  a  branch  office  at

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Chandigarh  and  hence  under  the  amended  Section  17(2)  the  

complaint could have been filed in Chandigarh.  We regret,  

we cannot agree with the learned counsel for the appellant.  

In our opinion, an interpretation has to be given to the  

amended Section 17(2) (b) of the Act, which does not lead to  

an absurd consequence.  If the contention of the learned  

counsel for the appellant is accepted, it will mean that  

even if a cause of action has arisen in Ambala, then too the  

complainant can file a claim petition even in Tamil Nadu or  

Gauhati or anywhere in India where a branch office of the  

insurance company is situated.  We cannot agree with this  

contention.  It will lead to absurd consequences and lead to  

bench  hunting.   In  our  opinion,  the  expression  'branch  

office' in the amended Section 17(2) would mean the branch  

office where the cause of action has arisen.  No doubt this  

would  be  departing  from  the  plain  and  literal  words  of  

Section 17(2)(b) of the Act but such departure is sometimes  

necessary (as it is in this case) to avoid absurdity. [vide  

G.P. Singh's Principles of Statutory Interpretation, Ninth  

Edition, 2004 P. 79]

In the present case, since the cause of action arose  

at Ambala, the State Consumer Redressal Commission, Haryana  

alone will have jurisdiction to entertain the complaint.  

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For the reasons stated hereinabove, we do not see  

any  reason  to  interfere  with  the  impugned  order  of  the  

NCDRC.  Accordingly, this appeal is dismissed.  No order as  

to the costs.

.....................J.       (MARKANDEY KATJU)

.....................J.                (ASOK KUMAR GANGULY)

NEW DELHI; OCTOBER 20, 2009