Great Ltd. having registered office at Jaipur (Rajasthan), entered into an agreement with Newsome Trading for supply of raw material worth ₹4 crore. It was clearly mentioned in the agreement that all disputes will be ref

Advice on Jurisdiction for Recovery Suit and Winding-up Petition: The management of Newsome Trading wants to file a recovery suit along with a winding-up petition against Great Ltd. The agreement specifies that all disputes will be referred to the Delhi High Court, while Great Ltd.'s registered office is in Jaipur (Rajasthan). 1. Jurisdiction for Recovery Suit: For a recovery suit, generally, parties can agree to a specific court's jurisdiction, provided that court otherwise has jurisdiction over the matter (e.g., where the cause of action arises or the defendant resides/has a registered office). If the Delhi High Court has territorial jurisdiction over any part of the cause of action or the defendant's business, then the clause referring disputes to Delhi High Court would likely be valid for the recovery suit. 2. Jurisdiction for Winding-up Petition: However, the jurisdiction for a winding-up petition is different and cannot be conferred by agreement between parties. It is determined by statute. In terms of the provisions of Section 10 of the Companies Act, 1956 (which was applicable at the time, now replaced by NCLT under Companies Act, 2013), the jurisdiction for entertaining a winding-up petition vests either in the High Court having jurisdiction in relation to the place where the registered office of the company is situated or the District Court of the area subordinate to the High Court, in which the jurisdiction has been vested either by the Act or by the Central Government by notification in the Official Gazette. Decided Case Laws: In GTC Industries Ltd. v. Parasrampuria Trading (1999) 34 CLA 380 (All HC) , it was held that only the High Court where the registered office is situated has jurisdiction in winding up, even if there was an agreement between parties that disputes would be resolved before a High Court where the registered office is not situated. Similarly, in LKP Merchant Financing v. Arwin Liquid Gases (2001) 103 Comp. Cas. 211 (Guj.) , it was reiterated that regardless of where an agreement is executed, the Company Court having jurisdiction over the place where the registered office is situated will have the jurisdiction to entertain a petition for winding up. Conclusion: Based on the above, while Newsome Trading might be able to file a recovery suit in the Delhi High Court as per the agreement (assuming Delhi High Court has some natural jurisdiction), a winding-up petition against Great Ltd. must be filed in the competent court/tribunal having jurisdiction over Jaipur, Rajasthan, where Great Ltd.'s registered office is located. The agreement to refer disputes to Delhi High Court will not confer jurisdiction for a winding-up petition on the Delhi High Court if Great Ltd.'s registered office is in Jaipur. Therefore, Newsome Trading should file the winding-up petition in the National Company Law Tribunal (NCLT) bench having jurisdiction over Jaipur, Rajasthan.