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The Fertilizers Corporation of India Ltd. Vs. the Tata Iron and Steel Co. Ltd. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtPunjab and Haryana High Court
Decided On
Case NumberCivil Revision No. 444 of 1963
Judge
Reported inAIR1965P& H143
ActsIndian Sale of Goods Act - Sections 39; Indian Contract Act - Sections 91
AppellantThe Fertilizers Corporation of India Ltd.
RespondentThe Tata Iron and Steel Co. Ltd.
Cases ReferredIn General Papers Ltd. v. Pakkir Mohideen and Bros.
Excerpt:
.....in exercising powers of superintendence under article 227 of the constitution. - ' (6) in my opinion, the courts at hoshiarpur clearly have jurisdiction to try the suit as part of the cause of action arose there......in pursuance of a contract of sale, the seller is authorised or required to send the goods to the buyer, delivery of the goods to a carrier, whether named by the buyer or not, for the purpose of transmission to the buyer........is prima facie deemed to be a delivery of the goods to the buyer'(5) the applicability to sub-section (1) of section 39 could have been placed beyond dispute if the transaction had consisted only of the delivery of the goods to the railway authorities at tata nagar for delivery to the petitioner. this is not, however, so. the invoice and the railway receipt show that the payment was to be made at nangal through the state bank of india and delivery was also to be made there, the goods being consigned in the name of the seller. under the column 'consigned to ' in.....
Judgment:
ORDER

(1) This rule at the instance of the Fertilizer Corporation of India, Nangal, is against the appellate judgment of the Senior Subordinate Judge, Hoshiarpur, who affirmed the decision of the trial Judge returning its plaint for presentation to the proper Court.

(2) The petitioner is plaintiff field a suit for recovery of its Rs.897.26 P. against two defendants, the Tata Iron and Steel Company Limited, Calcutta, and the Union of India through the General Manager, Northern Railways. The second defendant was later dropped and the suit proceeded only against the respondent Tata Iron and Steel Company. The suit was founded on the purchase order of 13th of January, 1959, in pursuance order of which the plaintiff asked the respondent to supply certain goods through the second defendant as carriers. The goods consisting of M. S. rounds and angles were to be handed over to the railway authorities at Tata Nagar for despatch to Nangal Dam railway station for delivery to the plaintiff against railway receipt No. 066811 of 21st of February, 1959. According to the invoice, the consignee is 'Tata Iron and Steel Company Limited, Nangal Dam Railway Station'. The freight was pre-paid and the invoice was addressed to the Chief Accounts Officers, Nangal Fertilizers through the State Bank of India, Nangal Township. According to the assertions made in the plaint the delivery of the goods was taken by the Nangal Fertilizers Corporation on 7th of March, 1959, after making full payment. The delivery took place at Nangal and the payment was also made to the seller through the State Bank of India at Nangal.

(3) The petitioner complains of having received short supply. Whereas in the railway receipt it was mentioned that 543 pieces were despatched, actually 560 were received and the bill was, however, for 577. After prolonged correspondence, the plaintiff brought a suit for recovery of a sum of Rs. 897-26 P. on account of short supply of 17 pieces.

(4) On behalf of the defendant, a plea was raised that the Hoshiarpur Court had no jurisdiction to try the suit and this question has been tried as a preliminary issue. The trial Judge and the lower appellate Court in agreement with him have held that the delivery having been made to the carrier, the property in the goods passed to the buyer at Tata Nagar and no part of the cause of action arose at Hoshiarpur where the suit was brought. Reliance has been placed on sub-section (1) of section 39 of the Indian Sale of Goods Act which provides that:

'Where, in pursuance of a contract of sale, the seller is authorised or required to send the goods to the buyer, delivery of the goods to a carrier, whether named by the buyer or not, for the purpose of transmission to the buyer........is prima facie deemed to be a delivery of the goods to the buyer'

(5) The applicability to sub-section (1) of section 39 could have been placed beyond dispute if the transaction had consisted only of the delivery of the goods to the railway authorities at Tata Nagar for delivery to the petitioner. This is not, however, so. The invoice and the railway receipt show that the payment was to be made at Nangal through the State Bank of India and delivery was also to be made there, the goods being consigned in the name of the seller. Under the column 'consigned to ' in the invoice, it is mentioned thus: 'Messrs. Tisoo Limited Nangal Dam Railway Station'. It cannot be said that the delivery in the instant case was made to the railway for delivery to the buyer.

The railway administration as carrier was to transmit the goods from Tata Nagar to Nangal Dam, but what is of significance to note is that the consignment is despatched to Nangal Dam railway station where delivery is to be made against payment through the State Bank of India. In my opinion, the authority on which reliance has been placed by the learned counsel for the respondent cannot be invoked in support of the proposition that in such circumstances the Court at Hoshiarpur had no jurisdiction to try the suit. In this authority of Martineau J. in Firm Nand Lal Das Mal v. Firm Mian Muhammad Ali Ali Bhai, AIR 1922 Lah 474

(2) the delivery was made by the seller of the goods sold, to the railway company to be despatched to the buyer and it was held that it operated as delivery to the buyer under section 91 of the Contract Act, which is in the same terms as section 39(1) of the Sale of Goods Act. The facts of that case were different and there is hardly any discussion in the short judgment of Martineau I

Mr. Jain for the petitioner, has placed reliance on two bench authorities which are more to the point. In General Papers Ltd. v. Pakkir Mohideen and Bros., AIR 1958 Mad 482 it was held by Chief Justice Rajamannar and Panchapakesan Ayyar J. that where the goods are despatched from Madras to Tenkasi, where the amount is actually collected from the buyer, the cause of action arose at Tenkasi where the payment is to be made. In that case, the prices were 'ex-godown Madras' and the goods were to be despatched by railway to Sattur railway station. The entire price and charges were paid by the buyer at Tenkasi. The petitioner in the present case actually paid the price at Nangal Dam and the goods were taken against payment. This was a part of the cause of action and the suit was maintainable at Hoshiarpur. Reference may also be made to Firm Dessee Veerabhadrayya Venkata Subbayya v, Biswanath Jagdish Prasad, AIR 1962 Andh Pra 338 which is a judgment of Chief Justice P. Chandra Reddy and Jaganmohan Reddy J. It was held in this case that

'the performance of the contract is part of the cause of action and a suit in respect of breach can be field at the place where the contract should have been performed or its performance completed. In cases of contract of sale of goods (1) the place where the goods have to be delivered, or (2) the place where the payment of money towards the price of the goods is to be made, is the place of performance and the Court of that Place will have jurisdiction to entertain the suit in respect of non-delivery of goods in accordance with the contract.'

(6) In my opinion, the Courts at Hoshiarpur clearly have jurisdiction to try the suit as part of the cause of action arose there. This petition will, accordingly, be allowed and the rule made absolute. The costs would abide the event. The counsel for the parties have been directed to appear before the trial Judge on 21st of September, 1964.

(7) Revision allowed and Rule made absolute.


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