1. This is an appeal by the State of Orissa against the concurrent decisions of the two lower courts dismissing their suit for recovery of a sum of Rs. 2600/- from the respondents.
2. Respondent No. 1 (Harichandan Babu) is a resident of Bhowanipatna which was part of the former (sic) state of Kalahandi. sometime in 1946 the tnen Ruler of Kalahandi agreed to bear the cost of giving him train-ing in the Imperial Dairy Research Institute, Bangalore, on matters relating to Dairy Farming. The, total sum wmcn the Ruler agreed to pay for this purpose was Rs. 2600/-. He also obtained from respondent No. 1 an agreement (Ex. / dated 5-1-1946) undertaking to serve the State of Kalahandi, for a period of not less Wan 15 years after completing his studies in the said institution. The Respondent further undertook that if he failed to fulfil any of the terms of the agreement he would refund to the Ruler the sum of Rs. 2600/-. Respondent no. 2 agreed to be the surety for respondent 1.
3. Respondent 1 completed the training in due course and the Ruler of Kalahandi also by his order dated 22-12-47 (Ext. A) appointed him as Cattle welfare Officer on a pay of Rs. 60/- per month in the scale of Rs. 60-10-130/- per month with effect from 1st January, 1948 by which time the expected 'the result will be out'. Apparently, though the respondent had undergone the necessary training at the Dairy Research institute, Bangalore he had not by that date passed the examination conducted by that institute. He actually joined duty on 2nd January 1948, but from the 1st January 1948 Kalahandi state merged with the Province of Orissa and the administration of that was taken over by the Administrator appointed by the Government of Orissa. The Administrator, by his order dated 21-1-1948 (Ext. B) refused to accept the appointment of respondent No. 1 saying that there was then no post for which respondent 1 was meant to be employed. The respondent's work was therefore discontinued. Later on the respondent passed the necessary examination from Allahabad sometime in April 1948. Then, on 25th September 1948 the Government of Orissa offered rum a temporary post of Dairy Overseer at Cuttack on a lower scale, viz., Rs. 60-2-100 per month (See Ext. D), but the respondent declined to accept it. Then after some correspondence the Government of Orissa as the successor in interest or the Ruler of Kalanandi called upon respondent No. 1 to pay track the entire money advanced for his training in the Imperial Dairy Research Institute at Bangalore and, on his refusal, filed the present suit under appeal.
4. The defence taken by the respondent was two-fold; Firstly it was contended that in accordance withone agreement (Ext. 7) the respondent was bound to serve only within the geographical limits of Kalahandi State and not outside the area. The offer of appointment made to mm in Ex. D was for a post at Khapuria Dairy Farm near Cuttack town and it was urged that the respondent was not bound to accept that appointment in accordance with the terms of the agreement (Ex. 7). Secondly, it was contended that when the Ruler of Kalanandi offered the post of Cattle Welfare Officer by his order D/- 22-12-47 (Ext. A) and when the respondent accepted that offer and joined the post on 2nd January 1948 he fulfled the terms of the agreement entered into by him. it was the subsequent conduct of the Administrator of Kalanandi in refusing to accept his appointment by his order dated 20-1-1948 (Ex. B) which threw him out of that job. Hence (sic) was contended that tn'e original contract under hxt. / came to an end and the subsequent actions between the parties were based on different considerations and had nothing to do with the terms of the agreement (Ex. 7) of 1946 and respondent no. 1 was not Bound to accept the new order made by the Administrator.
The lower appellate Court has not expressly considered the latter question fully discussed by the trial court, namely whether the offer of the Ruler of Kaianandi made in Ex. A and the appointment of the respondent as Cattle Welfare Officer with effect from 2-1-48 completed the contract or whether the subsequent conduct of the administrator of Kalahandi in refusing to recognise mat employment by Ext. B and the respondent's refusal to accept the post of Dairy overseer offered by the Govt. of Orissa in Khapuria Dairy Farm had anything to do with the original contract (Ex. 7) entered into between the respondent and the Ruler. The lower appellate Court should nave given a complete finding on this point, also, but the concluding portion of his judgment is to the following effect
'In my view of the case I find that the defendant respondent No. (1) had not broken any part of nis contract'.
These observations must therefore be construed to mean that he has fully endorsed the finding of the trial Court on this point also.
5. The first question for consideration is whether, when, a contract was entered into prior to the change of sovereignty, that contract can be enforced by the succeeding sovereign without the consent of the other party concerned. There were 2 parties to the contract, namely the Ruler of Kalahandi on the one hand and respondent No. 1 on the other. The ruler lost his sovereignty by cession; and the Union Govt. acting through the Government of Orissa became the new sovereign with effect from 1st January 1948. It was well settled that the new sovereign was not bound by any contract entered into by his predecessor except to the extent to which he specifically agrees to be so bound. The Administrator of Orissa States Order was made for this purpose, following the principle or mutuality it may well be argued that the other party to the contract also (respondent 1) will not be bound by the old contract unless he agrees to be bound by the same, after the change of sovereignty. This question, now-ever, need not be discussed here because this appeal can be disposed of on other grounds.
6. It will be noticed that in. the agreement EX. / there was no undertaking by respondent No. 1 that he would not only complete the preserved course of training at the Imperial Dairy Research Institute but also pass the examination prescribed by the institute. Similarly in the terms dealing with the offer of appointment after We completion of his training the Ruler did not say either expressly or by implication that the otter was conditional upon his passing the examination conducted by the Institution. The contract merely stipulated that after the completion of studies in the Institute respondent should serve the State tor a period of 15 years and the State also undertook to pay him at a rate deemed reasonable. There is always a fundamental distinction bet-ween completing a course of studies at an eaucationai institution on We one hand and the passing of an examination prescribed in We institution after the completion of studies, on the other.
7. The learned Advocate General contended that the following passages in the agreement (Ex. 7) implied that the respondent No. 1 should also pass the examination. 1 may quote them :
'Now the conditions of the above written Bond or obligations are such that if We said babu Hancnandant shall well, faithfully and diligently pursue his studies at the said institution and qualify for the said Dairy Farming, and shall also after completing the said studies at the institute, serve the said Ruling Chief of We state or Kalahandi. . . .'
According to the Advocate General We use ot the woras 'diligently pursue his studies' and 'qualifies for the said Dairy Farming' would show that the intention of the parties was that not only should respondent No. 1 complete his course of studies at the institution but should also pass the examination prescribed by the same, though there is some force in this contention, when respondent No. 1 is called upon to answer a claim arising out of a breach of contract, We terms of the contract nave to be strictly construed. A person may diligently pursue his studies In an institution but may fail to pass the examination due to other reasons. Similarly, the expression 'qua-lify for the said Dairy Farming' does not necessarily mean that the trainee must pass an examination conducted by the institution. In many institutions mere completion of the course of studies may qualify a person tor a particular post, though the passing of an examination conducted by the institution may be an educational qualification, what-ever that may be a written contract snould be construed strictly and there can be no question of beneficent construction.
Hence I must hold, in agreement with the trial Court, that under the terms ot We contract responceni No. 1 was only required to complete the course of study at the Dairy Research Institute at Bangalore and to accept We post that was offered to him thereafter. The Ruler of Kalahandi had in fact offered him such a post by Ex. A and respondent accepted the same by joining it on the 2nd January 1948. It is true that in Ex. A the Ruler stated that he expected the results to be out by 1st January, 1948. In view of this therefore the learned Advocate General contended that the offer of appointment was made conditional on the passing of the examination by respondent (No. 1). Ext. A however does not say so in express terms. In the letter of Administrator ot Kalananai, dated 21st January, 1948 also (Ex. B) the main reason, given for not accepting the employment of respondent No. 1 was said to be the non-existence of the post for which 'Sri H. C. Babu is meant to be employed.' It is true that the fact that the results of the examination were not yet out, was also mentioned in that order, but that was given a secondary reason. There was no undertaking in that order that if the respondent passed the examination he would be given a post which was promised to him under Ex. 7. Under these circumstances, I must hold that We contract (Ex. /) came to an end when the res-pondent joined the post offered to him by the Ruler on 2nd January 1948 and it was the conduct of the Administrator in refusing to recognise that post that threw him out of his job and led to further fruitless correspondence.
8. It is unnecessary to consider whether under me terms of the contract We Government of Orissa could ofter employment to respondent No. 1 in any place outside we geographical limits of the district of Kalahandi.
For these reasons the appeal fails and is dismissed with costs,
9. I agree.