In which court a “suit for accounts against Agent” may be filed?

Question: In which court a “suit for accounts against Agent” may be filed? [Bihar C.J. 1979]

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Answer

The jurisdiction of a court for filing a civil suit is covered under Section 16 to 20 of The Code of Civil Procedure, 1908. Further, the suit for accounts against agent is not covered under Section 16 to 19 of the Code. Section 20 determines the forum for the institution of a suit is not covered by Section 16 to 19. Thus, it will be covered by Section 20.

Section 20 states that –

Other suits to be instituted where defendants reside or cause of action arises.

Subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction

(a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain; or

(b) any of the defendants, where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides or carries on business, or personally works for gain, provided that in such case either the leave of the Court is given, or the defendants who do not reside, or carry on business, or personally works for gain, as aforesaid, acquiesce in such institution; or

(c) The cause of action, wholly or in part, arises.

Thus, according to Section 20, a suit may be filed in the court within the local limits of whose jurisdiction the cause of action arises (wholly or partly) or where the defendant resides. In a landmark case of Firm Shah Chandanmal v. Hazarilal, AIR 1962 Raj 122, it was held that in case of a suit for accounts against an agent, the cause of action arises at the place where accounts are to be rendered and payment is to be made by the agent.

Combining the effect of Section 20 and the case, it can be stated that a suit for accounts against agent may be instituted in the court within the local limits of whose jurisdiction the contract to the agency was made or accounts are to be rendered and payment is to be made by the agent or where the agent i.e. defendant resides.

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