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Soniram Jeetmull Vs. Tata and Company Limited - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai
Decided On
Judge
Reported in(1927)29BOMLR1027
AppellantSoniram Jeetmull
RespondentTata and Company Limited
DispositionAppeal dismissed
Excerpt:
.....been made by the promisor to the promisee to appoint a reasonable place and therefore there is no place of payment, consequently, this section, which, it is said, replaces any rule of law with regard to the obligation of the debtor to seek out the creditor, has not been satisfied, and so there is no part of the contract, which is performable in rangoon. it is quite certain that, if the application had been made, the place appointed would have been rangoon, and all would then have been well for the plaintiff. it is not easy to reconcile with the ordinary rules of law a construction which enables the promisor to better his position under his contract by neglecting to perform a statutory duty imposed upon him with regard to its performance. 4. what the contract precisely was does not..........it is not disputed that the business transactions, out of which the outstanding debts arose, took place in rangoon, and for this purpose the branch of messrs. tata, sons & company there were the messrs. tata, sons & company concerned, it was objected, however, in the high court of rangoon, that this constituted an importation of a technical rule of the english common law into the jurisprudence of india, namely, the rule that the debtor must seek out the creditor. the simple answer to that would have been that, on the contrary, it was a mere implication of the meaning of the parties, the appellants, however, rely upon section 49 of the indian contract act, which is in these terms:-when a promise is to be performed without application by the promisee, and no place is fixed for the.....
Judgment:

Viscount Sumner, J.

1. This is an appeal by special leave from the High Court of Rangoon, which affirmed a decision of the Court below, overruling an objection to the jurisdiction taken by the appellants. It was imposed upon the parties, as a term of the special leave, that the pleadings between the parties, the judgments and the order of the Court in India should be the sole material for this argument, The appellants were sued in Rangoon by R.D. Tata & Company, Limited, who have a business branch there, for payment of sums of money, due upon, the failure of constituents to satisfy debts due to Messrs. Tata, Sons & Company, which sums the defendants had undertaken to make good to them. Judgment had been obtained, and there was no dispute about the amount or validity of these debts or about their being due from the original debtors, but Messrs. Jeetmull, who carry on business in Calcutta, contend that they cannot be sued for this money in Rangoon. The transactions between these parties were a continuation of dealings which had existed for a number of years before the present plaintiffs became an incorporated company and had been carried on under a memorandum dated December 10, 1911, and signed in Calcutta. It is Clause 2 of that contract that expresses Messrs. Jeetmull's obligation to pay in the present case, and it says that Messrs. Jeetmull are to make good any undisputed claims that Messrs, Tata & Company might lose owing to the failure or suspension of payment of constituents. Accordingly, one point only arises, namely, whether the part of this contract relating to payment was performable by Messrs. Jeetmull in Rangoon. If it was, there was jurisdiction in the Court to entertain the suit and the objection of the appellants was rightly overruled.

2. The point, at first sight, appears to be exceedingly short. It is quite true the contract does not say where Messrs. Jeetmull are to pay, but it does say, by an implication which is indisputable, that they are to pay Messrs. Tata, Sons & Company, and it follows that they must pay where that firm is. Hence one would think that, upon the face of this contract, not indeed in express terms, but by the clearest implication, payment is to be made in Rangoon. In respect of the whole of this business it is not disputed that the business transactions, out of which the outstanding debts arose, took place in Rangoon, and for this purpose the branch of Messrs. Tata, Sons & Company there were the Messrs. Tata, Sons & Company concerned, It was objected, however, in the High Court of Rangoon, that this constituted an importation of a technical rule of the English Common Law into the jurisprudence of India, namely, the rule that the debtor must seek out the creditor. The simple answer to that would have been that, on the contrary, it was a mere implication of the meaning of the parties, The appellants, however, rely upon Section 49 of the Indian Contract Act, which is in these terms:-

When a promise is to be performed without application by the promisee, and no place is fixed for the performance of it, it is the duty of the promisor to apply to the promisee to appoint a reasonable place for the performance of the promise, and to perform it at such place.

3. Then it is said that no place was fixed by the contract or prior to the institution of this suit for the performance of the obligation of payment, and no application has been made by the promisor to the promisee to appoint a reasonable place and therefore there is no place of payment, Consequently, this section, which, it is said, replaces any rule of law with regard to the obligation of the debtor to seek out the creditor, has not been satisfied, and so there is no part of the contract, which is performable in Rangoon. The submission seems a strange one. It is quite certain that, if the application had been made, the place appointed would have been Rangoon, and all would then have been well for the plaintiff. Also it is plain that the section makes it the duty of the promisor to apply for the appointment of a reasonable place, a duty which in this case the promisor has entirely disregarded. It is not easy to reconcile with the ordinary rules of law a construction which enables the promisor to better his position under his contract by neglecting to perform a statutory duty imposed upon him with regard to its performance. The matter, however, is said to be covered by authority in India, and it therefore becomes necessary to consider what the authorities are. They do not appear to bear out the view which has been presented to their Lordships. In 1904, in the case of Motilal v. Surajmal I.L.R. (1904) 30 Bom. 167 6 Bom. L.R. 1038 Mr. Justice Tyabji held that (p. 171) 'where no specific contract exists as to the place where the payment of the debt is to be made, it is clear that it is the duty of the debtor to make the payment where the creditor is.' This follows the principle of Dhunjisha Nusserwanji v. A.B. Fforde I.L.R. (1887) 11 Bom. 649 where it was held that, 'In the absence of stipulation in the contract itself, the intention of the parties to it was to guide the Court in determining the place of its performance,' and upon that principle the suit, which was one relating to leave under Clause 12 of the Letters Patent, was decided against the jurisdiction of the Bombay Court. Then, shortly after the former of the above cases, in the case of Puttappa v. Virbhadrappa (1905) 7 Bom. L.R. 993 the High Court of Bombay had the matter before it on appeal. No authority whatever appears to have been cited, but, there being an objection that the Court had no jurisdiction to entertain a creditor's suit for recovery of payment from the debtor, Sir Lawrence Jenkins says (p. 994):-

This argument rests upon the assumption that the Common Law rule applies that a debtor must seek out his creditor. We think, however, in India the rule as to the place of performance, whether it be payment or any other mode of performance, is to be determined by Section 49 of the Contract Act; and applying that section to the facts of this case, we think, it is impossible to hold that the payment was to be made within the limits of the jurisdiction of the Sirsi Court, for, no such application has been made or place fixed as Section 49 prescribes. Therefore we are of opinion that the Sirsi Court had no jurisdiction.

4. What the contract precisely was does not appear, but the suit was to recover any balance that might be found due on taking accounts with interest, and the facts of that case differ from the facts of such a case as the present. Finally, this Board had the matter before it in 1925, in Bansilal Abirchand v. Ghulam Mahbub Khan (1925) L.R. 53 IndAp 58 28 Bom. L.R. 211 and there the English rule having been urged in terms upon their Lordships on the one side, and Puttappa's case on the other, Lord Blanesburgh for the Board says (p. 63):-

There is no promise either by the principal debtor or the surety to make any payment at Secunderabad, and so far as the principal debtor is concerned the bond above abstracted is the only promise on his part which is forthcoming. It is quite true that on failure of any instalment there is doubtless an implied promise by him to repay the loan. But there is no implied promise to repay it at Secunderabad, Even by British law the duty of a debtor to find and pay his creditor is only imposed upon him when the creditor is within the realm. And the plaintiff has not contended that if there be any such duty at all imposed by Indian law upon a debtor it extends in this respect further than in England. Accordingly so far as the principal debtor is concerned there is no obligation upon him, either express or implied, to make any payment to the plaintiff at Secunderabad.

5. Their Lordships do not think that in this state of the authorities it is possible to accede to the present contention that Section 49 of the Indian Contract Act gets rid of inferences, that should justly be drawn from the terms of the contract itself or from the necessities of the case, involving in the obligation to pay the creditor the further obligation of finding the creditor so as to pay him. The rule in Section 49 is one which it was intended should apply both to the delivery of goods and to the payment of money, to which obviously different considerations apply from those applying in a case like the present, where the question is one of jurisdiction, and their Lordships are satisfied that an intention is shown in the contract that payment should be made in Rangoon. Accordingly, part of the contract was performable in Rangoon so as to satisfy Section 49 of the Indian Contract Act,(1) and there was jurisdiction to entertain the suit.

6. Their Lordships will humbly advise his Majesty accordingly that this appeal should be dismissed with costs.


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