Posted On by &filed under Bombay High Court, High Court.

Bombay High Court
Chhunna Mal Ram Nath vs Mool Chand Ram Bhagat on 13 February, 1928
Equivalent citations: (1928) 30 BOMLR 837
Author: Atkinson
Bench: V Sumner, Atkinson, Sinha, J Wallis, L Sanderson


Atkinson, J.

1. This is an appeal from decrees of the High Court of Judicature at Lahore dated January 5, 1925, which reversed the decree of the Senior Subordinate Judge of Delhi dated January 14, 1924, and dismissed the suit of the plaintiff’ with costs.

2. The suit out of which this appeal, has arisen was one claiming damages for the non-delivery by the respondents of certain goods which the latter had agreed to sell and the appellants had agreed to purchase.

3. The principal question for decision in the appeal is whether under the circumstances proved in the case the plaintiffs are entitled to recover damages from the respondents for the alleged breach of their contract for the sale and delivery of the aforesaid goods.

4. In the order of Court of the Subordinate Judge of Delhi dated August 9, 1921, it is stated that the respondents (the defendants) had presented for the second time an application to be at liberty to add a plea that the plaintiffs were not ready or willing to perform their part of the contract entered into between the parties, and apropos of this application the Court said :-

The real question in dispute is whether, in face of the correspondence, could the plaintiff claim damages and could he consider the contract as subsisting. These points are covered by the issues already framed by me. If I find that the contract was cancelled and the plaintiff could not claim damages, the paint as to readiness and willingness would not arise.

If it is held by me that the contract subsisted, the question, as to readiness and willingness, would not crop up. We have got letters sent by the defendant that he considered the contract as cancelled, and if I hold that he was not justified in considering the contract as cancelled, lie had no litchi stand to raise the plea as to the want of readin833 and willingness on the part of the plaintiff.

5. The material parts of the aforesaid contract, which was dated November 29, 1916, and is very lengthy, ran as follows ;-

We had purchased one hundred and fifty (150) cases of white shirting marked D. 1 May to November, i. e., seven shipments, of the office of K.J. Wood, at 20s. 2d. We have sold the same to you at a net profit of Re, 0-4-0 par piece. The patterns and the invoices of the goods will be given to you on receipt. You shall have to take delivery of the goods on payment of their price to the Bank. You shall have to remove the goods on compliance with the condition of the office of B.J. Wood, You shall have to pay interest and go-down rent according to the terms of the office of R.J. Wood. Besides, you shall have to bear all the expenses incurred. The goods shall be fresh.

Contract made on Mangsir fiurti 5, Sambat 1973, through Moti Ram-Bam Kishan, Brokers,

(Sd.) Mul Chand Ram Bhagat.

Contract in respect of 140 (one hundred and forty) cases confirmed.

6. It is common ground that a case marked “D.-l” means a tin-lined case containing 50 pieces of Messrs. R.J. Wood & Co.’s shirting, manufactured in England, and the goods the subject of the said contract were sold by Messrs. K.J. Wood & Co, to the respondents, and were to be as so packed for export.

7. The plaint is verified by the appellants. In its sixteenth paragraph it is alleged, and apparently not disputed by the respondents, that the shipment of the portion of the goods which should have arrived in India in the months of May and June, 1917, did not arrive till the month of March, 1918. The shipments which should have been made in July and August, 1917, did not arrive till June, 1918, and those of September, October and November, 1917, did not arrive till July, 1918.

8. On April 24, 1917 (i. e., after the date of the said contract, but before the first shipment there under), an Order in Council was issued in London prohibiting the export of cotton goods in tin and wooden cases to India, and this was followed by a similar prohibition by the Government of India.

9. On April 28, 1917, the importers, Messrs. R.J. Wood & Co., wrote to the respondents as follows;-

As the British Government prohibited the use of wood and tin cases, kindly note that all your goods on order will come out packed in bales instead of cases until such prohibition is withdrawn; if we do not hear from you within three days we shall understand you agree to this. If not, kindly instruct us how to send the goods out.

10. On the same day the respondents wrote to the appellants a letter to the following effect:-

Dear Sirs,

As the British Government have prohibited the use of wood and tin cases kindly note that all your goods on order will come out packed in bales in place of cases unless such prohibition is withdrawn. If we do not hear from you within three days we shall understand you agree to this. If not, instruct us how to send the goods out.

11. On May 1, 1917, the respondents wrote to the appellants a letter in the following terms :-

We are in receipt; of your favour of date, and in reply have to say that, having sold Messrs, R.J. Wood’s goods to different parties, we cannot :on- firm the letter by sending it to you. If you are so very anxious to see the are quite welcome to come and see it at our shop. We have already sent you a copy of this letter, and if you will not come to our shop to satisfy yourself, please not(c) we shall not be responsible. Please further note that, if Atkinson we will not item from definitely in the matter within the allotted time you will be responsible for all consequences.

12. In reply to this letter the appellants on the same day wrote to the respondents a letter running thus :-

Dear Sirs,

With reference to your letter, we beg to inform you that we do not agree to take the goods sold by you to us in bales instead of cases. Hence we cancel the goods, which please note.

13. Cancel the goods is not an accurate expression, and in this connection must mean cancel the contract entitling us to receive the goods.

14. To this letter the respondents on May 2 replied in the following terms:-

Dear Sirs,

We are in receipt of your letter dated May 1, 1917, and in reply have to say that we sold you goods as per Messrs. R, J. Wood’s term, and as that office is going to ship goods in bales instead of cases, you are bound to abide with these terms and accept goods in bales. Please note that you arti not bound to cancel the goods, and you will have to accept goods in bales as required by Messrs. R.J. Wood.

15. On May 4, IDl1?, the appellants again wrote to the respondents thus:-

Dear sirs,

In reply to your letter of the 1st of May, we bog to tell you that wo…have an celled the goods, and we again inform you. Please note.

16. On May 4 the appellants replied in the following term to the respondents’ letter of May 2 (which they must have received on the 3rd of that month.) Their letter runs thus :-

In reply to your letter of the 3rd of May, we cannot accept the goods in bales instead of cases and tins. Please consider them as cancelled. Please acte once for all, as our dealers do not agree, we cannot accept.

17. On May 8 the appellants again wrote to the respondents a letter in the following terms:-

Dear Sirs,

Re our previous correspondence, we beg to tell you that we have cancelled all goods ordered through you, and we will not take at any stake, and also note we have reason and authority to cancel, and hence we will not at all be responsible for the delivery, which please note.

18. The appellants could not have been more emphatic in repudiating any obligation to accept bales and in refusing to be bound by or to perform it. If delivery of the shirting, packed in bales, was hi conformity with the contract, the appellants clearly deckled that they would not accept them, and this was acquiesced in by the respondents.

19. No evidence was given establishing that the goods purchased by the appellants could not have been safely shipped and carried to their destination, though packed in bales instead of in wooden boxes lined with tin. The lower Court was of opinion that packing in these cases was not part of the description of the goods, sold. The High Court, on the contrary, expressed the opinion, grounded on the authority of the cases of Bowes v. Shand (1877) 2 App. Cas. 455 and the case of In re Moore & Co. and Landauer & Co (1921) 2 K.B. 519 that the packing of the goods in such cases was part of the description of them. Having regard to the conclusion at which their Lordships have arrived on other portions of the ease, it is unnecessary to deal with this point at length or to express any definite opinion upon it.

20. Section 39 of the Indian Contract Act runs thus :-

When a party to an agreement enforceable by law lifts refused to perform or disabled himself from performing us accepted proposal in Its entirety, the person accepting the proposal may put an end to the agreement enforceable by taw unless he has signified by words or conduct his acquiescence in its continuance.

21. Section 63 runs thus:-

Every person who accepts a. proposal may dispense; with or remit wholly the performance of the proposal made to him which he has accepted, or he may extend the time for such performance or may accept instead of it any satisfaction which he thinks fit.

22. The contentions raised on these sections were as follows. The respondents, relying on as, 39 and 63, said that the appellants had put an end to the agreement and had expressly dispensed them from delivery at all. The appellants contended that Section 63 applied only where there was an agreement to dispense or a contract, supported by consideration, to do so, and that in any case it could only operate, when the party dispensing had performed his part of the contract and only something remained to be performed on the other side, unless dispensed with (Abaji Sitavam v. Trimbak Municipality (1903) I.L.R. 28 Bom. 66 s.c. 5 Bom. L.R. 689. They further said that, if they had been wrong in refusing in advance to accept bales, this repudiation had not been accepted by the respondents, and therefore the contract remained alive and ought to have Been performed. It will be observed that their Lordships, in setting out these two sections (Section 39 and 63), It is evident that the alleged dispensation under Section 63 is by itself a complete answer, unless the absence of contract or consideration is fatal, for the appellants again and again dispensed with the performance by the respondents of their promise to deliver the goods contracted for, and they cannot recover damages for the breach of a promise touching the performance thing they wholly dispense with.

23. In Abaji Sitaram, v. Trimbak Municipality Chief Justice Jenkins deals with Section 63, and holds that the promise mentioned in Section 63, can only do the acts he is by that section empowered to do, if there be an agreement (as defined by Section 2(e)) amongst the parties to that enact. At p. 72 of the report of this case the learned Judge is reported to have expressed himself thus :-

Therefore we hold that assuming that there was a legal resolution, and that it was communicated as alleged, still inasmuch as a dispensation or remission under Section 63 requires an agreement or contract wt, the resolution was of no legal effect since the provisions of Section 30 of Bombay Act II of 1884 have not been observed.

24. With this their Lordships are unable to agree. The language of the section does not refer to any such agreement and ought not to be enlarged by any implication of English doctrines. On this they agree with the learned Judges of the High Court.

25. They are, therefore, of opinion that the appeal fails and should be dismissed with costs. They will humbly advise His Majesty accordingly.

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