M/S. HANIL ERA TEXTILES LTD. vs M/S. PUROMATIC FILTERS (P) LTD.

The Supreme Court held that the jurisdiction for legal proceedings arising from a contract is determined by the terms agreed upon by the parties, specifically referencing Clause 17 of the Local Purchase Order which stipulated that any legal proceedings shall be subject to the jurisdiction of the Courts in Mumbai. The Court found that the Delhi High Court erred in asserting jurisdiction based on the delivery of goods in Delhi, as the contract was formed in Mumbai and payments were made there. Consequently, the appeal was allowed, and the plaint was directed to be returned for presentation in the appropriate jurisdiction.