• Subject to xyz jurisdiction applicablity on supply chain

Sir,
 We produce and sell seeds to a distributor. We are located in Coimbatore. Our distributor located in Madurai. Our invoice to distributor clearly says "subject to Coimbatore jurisdiction". Our business is over here. Now distributor invoices this material to a dealer at Dindigul. This dealer creates a bill and sells to a farmer. A farmer is asking ransom citing non-performance of our seed and threatens us that he will file a case in consumer court there. In this scenario, how "subject to Coimbatore jurisdiction" will be considered? 

Producer sells to distributor > Distributor sells the goods in his invoice to Retailer > Retailer sells goods in his invoice to end user > End user want to file a case on Producer. 

But end user has never seen the invoice of producer's terms and conditions. 

Please enlighten me how this will be treated in Court.
Asked 5 years ago in Civil Law

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13 Answers

If any where on your seeds packet it mention all details of quality, quantity, pricing trader mark and at last marked by address and below that you should mention in small line subject to Coimbatore jurisdiction.

If you have registered your trade mark and all details then there should not be any issue

 

you can go below these cases

 

The most noticeable reform on the horizon is the Consumer Protection Bill, which is extensively discussed above. It contains a special chapter on product liability but most consumer advocates will argue that it does not go far enough to impose higher product liability standards (see question 24). In one of the few consumer cases to be decided in 2012 by the Supreme Court of India (see the National Seed Corporation case in question 11), the court interpreted the definition of a ‘consumer’ broadly to include farmers who had purchased defective seeds despite the existence of a separate law (the Seeds Act) that regulated seed sales as the Seeds Act did not provide for compensation. This trend has continued in the more recent case of Punjab University v Unit Trust of India by which the Supreme Court decided that the Punjab University may be treated as a consumer.

However, in the recent case of Pratibha Pratisthan and Ors v Manager Canara Bank and Ors (AIR 2017 SC 1303) the Supreme Court held that a trust is not a person and thus cannot be treated as a consumer. Section 2(1)(d) of the CPA clearly specifies that ‘a consumer means any person who’ buys a commodity or hires or avails themselves of a service. Having held in 2012 that the CPA was a beneficial piece of legislation and assuming an apparent inadequacy in the provisions of the Seeds Act, there was no reason to exclude farmers from the definition of ‘consumer’, the court held that where there was no intent towards profiteering and commercial activity there was no reason to exclude the university from the definition of a consumer. While remaining traditionally conservative in the quantum of damages for deficient products and services, the consumer courts and the Supreme Court freely admit claims and avoid technical disqualifications to dismiss or completely deny relief.

Ganesh Kadam
Advocate, Pune
13008 Answers
267 Consultations

Parties cannot decide jurisdiction of consumer court. IT is where cause of action arise or where respondent have office. 

Have you given assurance in the invoice or marketing that seeds would give proper yield ? Prepare the seed quality report from Seed Inspector or District Level Enquiry Committee or some independent agency.

Yogendra Singh Rajawat
Advocate, Jaipur
23082 Answers
31 Consultations

Only in event of dispute between you and distributor would it be subject to jurisdiction of courts at Coimbatore 

 

farmer can sue you in consumer court wherein he is residing and bought the seeds 

Ajay Sethi
Advocate, Mumbai
99786 Answers
8146 Consultations

The jurisdiction can also be on the ground of cause of action. So he can file there making you party

Prashant Nayak
Advocate, Mumbai
34522 Answers
249 Consultations

1. If there is jurisdiction of multiple courts then parties by agreement can restrict the jurisdiction to a particular court. 

2. Now in this case since there is no privity of contract between you and farmer then the case can not be limited to Coimbatore alone.

3. Therefore the case filed by farmer is valid and can not be dismissed on the jurisdiction ground alone. 

Devajyoti Barman
Advocate, Kolkata
23655 Answers
537 Consultations

- Since in your invoice there is mention that in case of any dispute , the jurisdiction would be Coimbatore only, then if the said end user having dispute over the performance of your produced seeds , then his complaint against you cannot be sustained out of Coimbatore. 

- However, as the cause of action arose at the place of end user , then he can file his complaint before the consumer forum where he has purchased the same.

- But for the execution of the said complaint decree, only Coimbatore will be jurisdiction . 

Mohammed Shahzad
Advocate, Delhi
15814 Answers
242 Consultations

Hi Please find our response to your queries

 

1) Territorial Jurisdiction:

a) In law under consumer act, vide section 11(2) of consumer protection act, the consumer should show that cause of action arose when he purchased the seeds from the dealer and he can file the case at the place where dealer does the business.

 

b) In the said petition, he can also implead you as a Second/Third Respondent and as such you will need to contest the case where the consumer chooses to file the complaint against the dealer.

This has been upheld by Supreme Court in  Fair Air Engineers Ltd. & Ors. v. N.K. Modi and  various other judgments in  State Consumer Disputes Redressal commission.

 

2) LIABILITY OF MANUFACTURER WHEN GOODS ARE SOLD THROUGH DEALERS:

In law, (Supreme Court of India in M/S. National Seeds Corpn. Ltd vs M.Madhusudhan Reddy & Anr on 16 January, 2012 and  Maharashtra Hybrid Seeds Company Ltd. v. Alavalapati Chandra Reddy ) has held that the producer is jointly responsible for the seeds so supplied by him through the supply chain and the farmer has the right to sue the dealer, distributor and the producer)

 

3) Good Defense in support of your case: 

In the same judgment, Supreme court also has held that if the manufacturer/ producer of  seeds has got his sample tested in the laboratory prior to sales, then the farmer cannot hold the Seed manufacturer/ producer responsible.

Another defense could be method of use of seeds by the farmer. If the manufacturer has prescribed various steps for usage of seeds, then if the same has not been complied on account of farmer's mistakes/ scanty rainfall etc, then manufacturer is not liable 

Another defense could be testing of soil conditions prior to seeding activities. If the manufacturer has prescribed testing of soil conditions prior to use of seeds, then this is a good defense for manufacturer.

You may refer to judgments in M/S. National Seeds Corpn. Ltd vs M.Madhusudhan Reddy & Anr on 16 January, 2012 and  Maharashtra Hybrid Seeds Company Ltd. v. Alavalapati Chandra Reddy  wherein defenses to manufacturer's are available. 

Hope this information is useful. 

 

 

 

Rajgopalan Sripathi
Advocate, Hyderabad
2173 Answers
394 Consultations

You will be one of the party and the farmer can file in his place and you are liable to answer. 

G.Rajaganapathy

Rajaganapathy Ganesan
Advocate, Chennai
2300 Answers
8 Consultations

If you have any agent or any branch over there his case will not be entertained for want of jurisdiction.

Regards

Swarupananda Neogi
Advocate, Kolkata
2993 Answers
6 Consultations

If the farmer considers legal action against the retailer, he shall be at liberty to sue the retailer at any court having proper jurisdiction. Your contract with your distributor shall in no way bind the end-user farmer in the matter of jurisdiction, as there is no privity of contract between you and the farmer as such.

Swaminathan Neelakantan
Advocate, Coimbatore
3070 Answers
20 Consultations

Your mention about the jurisdiction will not bind the person who wishes to sue you in a consumer forum in his native district.

You first have to appear before the forum and explain that the forum do not have jurisdiction in this matter since the same has jurisdiction in Coimbatore only as mentioned in the invoice.

However the farmer can raise the jurisdiction validity stating that the cause of action would determine the jurisdiction.

 

 

T Kalaiselvan
Advocate, Vellore
89988 Answers
2493 Consultations

This is clear loop of jurisdiction. 

Retailers are liable for this and they will have to carry out the replies and all.

If you get notice in written than reply that this is not your fault and even jurisdiction 

Rahul Jatain
Advocate, Rohtak
5365 Answers
4 Consultations

Dear Sir/Madam,

You are suggested to raise the issues with all the concerned persons with the supply chain and making aware of the things so that nothing is going against you.

Ganesh Singh
Advocate, New Delhi
7169 Answers
16 Consultations

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