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Madina Rice Mills Vs. V. Sampangirmiah - Court Judgment

LegalCrystal Citation
CourtKarnataka High Court
Decided On
Case NumberAppeal No. 124 of 1949-50
Reported inAIR1953Kant66; AIR1953Mys66; ILR1952KAR230
ActsSales of Goods Act, 1930 - Sections 35; Indian Contract Act, 1872 - Sections 55, 73, 74 and 93; ;Evidence Act, 1872 - Sections 92
AppellantMadina Rice Mills
RespondentV. Sampangirmiah
Appellant AdvocateS.K. Venkataranga Iyengar, Adv.
Respondent AdvocateM.R. Janardhanam, Adv.
.....alleged arrangement to enlarge period of supply would had in writing - neither in plaint nor in evidence time for extension of performance given - court modified decree in plaintiff's favour. - limitation act (36 of 1963)section 5: [n.k.patil,j] order rejecting application for re-grant of inam property appeal against was filed after inordinate delay of 23 years explained by petitioners saying that they came to know about impugned order only after 23 years however, no statement made as to their source of information held, explanation offered by petitioners does not inspire confidence of court. petitioners duty bound to explain delay satisfactorily by assigning cogent reason and showing bona fide. delay not condoned. - 3. sri venkataranga iyengar on behalf of the appellant..........quantity- 1001 one thousand and one maunds only. rate 8-8-0 rupees per maund of 23 ibs. ex. mills. time of delivery -- end of october 1945 option - 'nil. terms of advance : 2000. terms of payment : cash against delivery. 2. the receipt of rs. 2,0007- as advance from the respondent is admitted and that the quantity supplied is only 167 maunds is not disputed. there is difference between the parties as to who is responsible for the rest of the stipulated quantity not being supplied, each party imputing default to the other. after exchange of notices the suit relating to this appeal was filed on 31-3-1948 for recovery of rs. 107057- made up of rs. 2000/- paid as advance, rs. 375/- cost of barrels left with the defendant and rs. 83307-as damages. defendant denied liability to pay anything,.....

1. This is an appeal by the defendant in a suit for damages for breach of contract. The contract is in writing marked Ex. A dated 2-10-1945 and signed by the parties. The terms of the contract arc expressed thus :

'Quality:- Ground-nut oil. Quantity- 1001 one thousand and one maunds only. Rate 8-8-0 Rupees per maund of 23 Ibs. Ex. Mills. Time of delivery -- end of October 1945 Option - 'Nil. Terms of advance : 2000. Terms of payment : cash against delivery.

2. The receipt of Rs. 2,0007- as advance from the respondent is admitted and that the quantity supplied is only 167 maunds is not disputed. There is difference between the parties as to who is responsible for the rest of the stipulated quantity not being supplied, each party imputing default to the other. After exchange of notices the suit relating to this appeal was filed on 31-3-1948 for recovery of Rs. 107057- made up of Rs. 2000/- paid as advance, Rs. 375/- cost of barrels left with the defendant and Rs. 83307-as damages. Defendant denied liability to pay anything, as, according to him, plaintiff alone was to blame for the contract not being fully carried out. The learned District Judge on a consideration of the evidence held that defendant was in default and liable to pay damages which were assessed at Rs. 4,378-8-0 together with the advance and value of barrels as claimed by the plaintiff.

3. Sri Venkataranga Iyengar on behalf of the appellant argued that the finding of the learned Judge is not warranted by the evidence and referred to the relevant portions thereof to show that the plaintiff himself has failed to perform the Initial conditions necessary to support the claim. From the terms 'Ex-Mills' in Ex. A it is clear that the goods had to be delivered at the defendant's mills at Channapafcna and Section 35, Sale of Goods Act requires that the buyer should apply for delivery. The buyer had further to be ready with the money for payment at the time of delivery. There was no obligation on the defendant to send or deliver the goods unless the plaintiff applied for it and the price was offered. According to Ex. A the entire supply had to be made by the end of October 1945. The plaintiff did not write to the defendant in Exs. VI, VII and VIII which are the only letters in October that he wants it or arranged to take it. In Ex. VI he complains about the quality of the oil sent and in Ex. VII he seeks intimation of the rate at which the oil would be supplied in November in order to enter into a new agreement. None of the witnesses examined for the plaintiff says that any one went to the defendant on plaintiff's behalf in October to obtain delivery of the oil. In view of this the plaintiff is not justified in claiming damages on the ground of defendant committing a breach of the contract.

4.(a) It was contended for plaintiff that time of performance was extended and that the partial supply of oil subsequent to October implies obligation on the defendant to deliver the remaining quantity. Exhibit VII dated 12-10-1945 in which plaintiff writes 'If you inform us definitely the rate at which 1000 maunds will be supplied next month that is in November and if it suits us an order will be placed' shows that supply of oil after October was, if at all, to be made at rates to be settled independently of Ex. A.

4.(b) Generally in the case of Mercantile contracts and when the rates were daily fluctuating as is evident from the evidence, the time prescribed is to be treated as the essence of the contract: See 29 Mys C. C. R. 38(A). The plaintiff has not produced any accounts to show the dates on which 167 barrels of oil were supplied and the rates at which these were valued. Defendant says that the supplies had to be paid for at rates different from that in Ex. A. When the terms were once reduced to writing and both parties signed it in token of their consent, the alleged arrangement to enlarge the period for supply would have been, if true, likewise in writing. The plaintiff admits in his evidence 'After the expiry of the time fixed in Ex. A there was no fresh agreement between us, implying thereby that the contract under Ex. A was not treated as being in force. The uncertainty and indefiniteness of the period extended for performance are other factors which make it difficult to accept the plaintiff's version. Neither in the plaint nor in the evidence is the time for performance as extended given. In the circumstances of the case a determination of this on consideration of reasonableness would be arbitrary and not warranted by the conduct of the parties and the nature of the contract.

4.(c) The plaintiff says that there was no supply at all after February 1946 and yet he did not demand the goods till August 1947 when he got a notice issued to the defendant. It is highly improbable and unreasonable to suppose that the contract was kept open for so long or that plaintiff would have waited till then to seek delivery if the theory of extension is true. In -- 'Sivayya v. Ranganaya Kuler' , where the claim was similar it was observed with reference to Section 93, Contract Act now replaced by Section 35, Sale of Goods Act that the buyer is under an obligation to apply for delivery and the obligation may be relieved by a special contract to the country or mercantile usage. -- 'Dinkerrai Lalit-kumar v. Sukhdayal Rambilas', AIR, 1947 Bom 293 (C), was a case in which construction of S. 35, Sale of Goods Act arose and the learned Judges hold that where the buyer sues the seller for damages for non-delivery of goods application for delivery on his part is a part of the cause of action unless there is an express stipulation to the contrary and must be explicitly stated in the plaint.

4.(d) 37 Mys H. C. R. 16(D), relied upon by Sri Janardhanam for the respondent is not of help as it does not touch the question of delivery having to be asked for, the case was not one under the Sale of Goods Act and for escaping the bar of limitation delivery of part of the goods beyond the time prescribed was treated as sufficient. Neither in the plaint nor in the evidence in this case is it alleged that at any particular time the plaintiff sought for delivery and as such the defendant cannot be held responsible for non-supply of the goods. The determination of the date of breach or the question of damages does not arise for consideration since the plaintiff cannot get damages to any extent.

5. As regards Rs. 2000/- receipt of which as advance is admitted by the defendant, there is no reason to disallow the claim for refund. In 9 Mys L. J. 35 (E), which related to contract for sale of goods, repayment of the advance was ordered on the view that when both parties are at fault one of them should not be permitted to get an advantage over the other by retaining the advance money, the consideration for such retention having failed. The defendant in the course of his evidence states that there is no provision for for feiting the amount and that he did not inform the plaintiff of its being forfeited. He also says that the forfeiture is not noted in the account. The correspondence and evidence indicate that the mills were not always working and in a position to supply the full quantity of oil mentioned in Ex. A. The allegation in the plaint that the value of the goods supplied has been paid up is not denied in the written statement. Sri Venkataranga Iyengar did not attempt to justify defendant withholding the amount. Besides Rs. 2,000/- paid as advance plaintiff is entitled to get Rs. 375/- as value of 15 empty barrels. Though defendant denied being in possession of these, Ex. B-4 written by him and Ex. IX produced by him show that the demand for return of the barrels in plaintiff's notice which is supported by the entry in Ex. II are justified.

6. In modification of the decree of the lowerCourt, there will be a decree in plaintiff's favourfor Rs. 2,375/- with current interest. Partieswill pay and receive costs in proportion to theirfailure and success in both Courts.

7.Order accordingly.

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