A files a suit for recovery of Rs. 2,00,000 against B before a court having pecuniary jurisdiction up to Rs. 1,00,000. What are B's options?

Understanding the Defect: Section 6 and Section 15

Section 6 of the Code declares in unambiguous terms that nothing in the Code shall operate to give any Court jurisdiction over suits the amount or value of the subject-matter of which exceeds the pecuniary limits of its ordinary jurisdiction. Section 15, which is a directive to the plaintiff, commands that every suit shall be instituted in the Court of the lowest grade competent to try it. In our example, A has violated both the spirit of Section 15 and the command of Section 6 — the suit for Rs. 2,00,000 cannot be entertained by a court whose limit stops at Rs. 1,00,000.

It must, however, be clearly understood at the outset that a lack of pecuniary jurisdiction is not the same as a total absence of jurisdiction over the subject-matter. The courts have consistently drawn a distinction between the two. Inherent lack of jurisdiction — where the court has no power whatsoever to try that class of suit — renders a decree a nullity. But an error of pecuniary jurisdiction is a curable, technical defect, one that can be waived, and a decree passed by a court with no pecuniary jurisdiction to try the suit, though irregular, is not an absolute nullity in the same sense. This distinction shapes all of B's options.

Option 1: Raise the Objection at the Earliest Opportunity

The most straightforward course of action for B is to object to the pecuniary jurisdiction of the court at the very first available opportunity. This is not merely a right — it is a necessity if B wishes to preserve the objection for a higher forum.

Section 21(2) of the Code, inserted by the Code of Civil Procedure (Amendment) Act, 1976, mandates that no objection as to the competence of a Court with reference to the pecuniary limits of its jurisdiction shall be allowed by any Appellate or Revisional Court unless such objection was taken in the Court of first instance at the earliest possible opportunity, and in all cases where issues are settled, at or before such settlement, and unless there has been a consequent failure of justice. All three conditions — timely raising, earliest opportunity, and failure of justice — must co-exist for an appellate court to entertain the objection.

This means that B must raise this objection in his written statement, or at the very latest when issues are being framed. If B takes part in the proceedings without raising this objection, he runs a very serious risk — as will be seen in the next option.

Option 2: Do Nothing — The Consequence of Waiver

B can, consciously or inadvertently, choose to do nothing, participate in the proceedings, and contest the suit on its merits without raising the jurisdiction issue. The law takes a clear position here.

Pecuniary and territorial jurisdiction, unlike jurisdiction over the subject-matter of a suit, can be waived by acquiescence. If B allows the suit to proceed to trial, contests the claim, and only raises the pecuniary jurisdiction issue in appeal after losing, the appellate or revisional court will not entertain the objection — because it was not raised at the earliest possible opportunity in the trial court, as mandated by Section 21(2). Moreover, even if B raised it in the trial court but was overruled, and later takes it to the appellate court, the appellate court will still decline to interfere unless there has been a failure of justice as a consequence of the trial in the wrong court.

The logic behind this policy was stated clearly by the Supreme Court in Kiran Singh v. Chaman Paswan (AIR 1954 SC 340): when a case has been tried on the merits and a judgment delivered, it should not be reversed purely on technical grounds unless there has been a prejudice to the merits of the case. The policy underlying Sections 21 and 99 of the Code is identical — technical objections as to jurisdiction cannot be used to set aside otherwise sound judgments.

Option 3: Raise the Objection and Have the Plaint Returned

If B raises the objection in time and the court accepts it, the appropriate remedy is not dismissal of the suit but return of the plaint under Order VII, Rule 10 of the Code. The court, upon finding that it lacks pecuniary competence to try the suit, shall return the plaint to the plaintiff for presentation to the proper court — which, in this case, would be a court competent to try suits up to Rs. 2,00,000 or more.

This is a critical procedural distinction that B and A both must appreciate. Return of the plaint is not the end of A's litigation — A can re-present the plaint to the competent court. However, this is not a transfer of the suit. The Supreme Court has expressly clarified that the return of a plaint due to want of jurisdiction is not the same as a transfer under Section 24 of the Code; on re-presentation before the competent court, the suit begins afresh and cannot be continued from the stage at which it was returned.

The Question of a Subsequent Challenge: Section 21A

There is one further dimension that B should bear in mind, particularly if he participates in the proceedings without objecting and a decree is eventually passed. Section 21A of the Code, inserted by the Amendment Act of 1976, bars a subsequent suit to challenge the validity of a decree passed in a former suit between the same parties on any ground based on an objection as to the "place of suing."

The Supreme Court has held that the expression "place of suing" in Section 21A covers not just territorial jurisdiction but also pecuniary jurisdiction, since Sections 15 to 20 all deal with the "place of suing." The effect is stark: if B does not object in time in the trial court, and a decree is passed, B cannot challenge that decree in a fresh suit on the ground that the court lacked pecuniary jurisdiction. His only remedy, if any, would be through appeal or revision — where, as noted above, the objection will be considered only if it satisfies all the conditions of Section 21(2) including failure of justice.

Practical Summary of B's Choices

The lesson the law teaches through this framework is one of procedural discipline. A defendant who wishes to take advantage of a jurisdictional defect must speak when he can — at the threshold. If he waits until it suits his convenience, having otherwise participated fully in the proceedings, the law will not come to his rescue merely because the wrong court was chosen. As the courts have repeatedly held, justice on merits must not be sacrificed at the altar of technical objection.