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Sutlej Cotton Mills Ltd. Vs. Dr. Ranjit Singh - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtPunjab and Haryana High Court
Decided On
Case NumberSecond Appeal No. 739 of 1950
Judge
Reported inAIR1952P& H263
ActsContract Act, 1872 - Sections 188
AppellantSutlej Cotton Mills Ltd.
RespondentDr. Ranjit Singh
Appellant Advocate Mela Ram Aggarwal, Adv.
Respondent Advocate A.R. Kapur and; N.L. Wadehra, Advs.
DispositionAppeal allowed
Cases ReferredAshbury Railway Carriage Co. v. Riche
Excerpt:
..... - that section in my opinion is wholly inapplicable as there is nothing in the evidence which shows that the company did anything which could have induced in the mind of the plaintiff the belief that brij lal jajoo had the authority to accept responsibility on behalf of the company for the safe custody of the plaintiff's goods and then to account for them......scope of his authority to give an assurance to the plaintiff that if he left his goods with the company the company would be responsible for the loss, nor is it proved that it was within the authority of the secretary to give any assurance as to the rendition of accounts by the company. 5. the witnesses who have been produced by the plaintiff throw very little light on the scope of the authority of the secretary or on the powers of the company. according to mr. gollen who was examined on commission the property left by the plaintiff was opened by major pott, an engineer, and his son-in-law and he, the witness, wrote a letter to the plaintiff saying that some goods of his were there which could not be sent out to india and they could be sold if he, the plaintiff, approached mr. jajoo.....
Judgment:

Kapur, J.

1. This second appeal is against an appellate judgment and decree of Mr. Gurcharan Singh, Senior Subordinate Judge, Ludhiana, allowing the appeal against a decree of the trial Court dismissing the plaintiff's suit.

2. The plaintiff brought this suit against the defendant-company alleging that, during the disturbances of 1947 it was given out on behalf of the Company that these employees who would continue to work in their poses would be Protected by them in regard to their person and property and the Company would be responsible for the same, that in August 1947 the Secretary told the plaintiff and other employees that they should lock up their goods and leave them in his charge and that the company would be liable for everything and that at the end of the disturbances the plaintiff and the other employees would be sent for and thus he left his goods with the defendant-company a list of which is given in Schedule 'A' attached to the plaint. He further alleged that it became impossible for him to return and through Mr. M. C. Gowen an attorney and servant of the defendant company, the defendants informed him that new cloth could not be sent to India and therefore if the plaintiff was agreeable it could be sold there and after the sale a full account would be rendered to which the plaintiff agreed. The suit is for rendition of accounts against the defendant-company.

3. The defence was that a suit for accounts did not lie, that no servant of the company could act contrary to the bye-laws and articles of association of the company and the company was not therefore liable and the Secretary was not authorised to accept the goods nor to give any such assurance as is alleged in the plaint, that the servants of the company could not bind the company to render any accounts. This suit was dismissed by the trial Court, but on appeal the suit was decreed. The appellate Court held on the evidence that Brjj Lal Jajoo was the general attorney of the company in Pakistan who sold the goods of the plaintiff which Were left in the plaintiff's quarters in the mill premises, that he deposited the sale price with the company for payment to the plaintiff and thus the company was liable and that a suit for accounts lay. The company has come up in appeal to this Court.

4. The first point to be decided is whether the Secretary was an attorney of the company and it was within the scope of his authority to give assurance that he is alleged to have given to the plaintiff. In support of this allegation the plaintiff has produced several witnesses, but there is no evidence to show as to what was the nature pf the authority given by the company to Brij Lal Jajpo, the Secretary of the Company. Even the plaintiff as a witness has hot stated anything in regard to the scope of the authority of the Secretary. The company is a creation of the statute and acts within the powers given to it under the memorandum and articles of association and nothing has been proved as to what the powers of the company itself were and even in regard to the powers of Mr. Brij Lal Jajoo, nothing is stated which would show that it was within the scope of his authority to give an assurance to the plaintiff that if he left his goods with the company the company would be responsible for the loss, nor is it proved that it Was within the authority of the Secretary to give any assurance as to the rendition of accounts by the company.

5. The witnesses who have been produced by the plaintiff throw very little light on the scope of the authority of the Secretary or on the powers of the company. According to Mr. Gollen who was examined on commission the property left by the plaintiff was opened by Major Pott, an engineer, and his son-in-law and he, the witness, wrote a letter to the plaintiff saying that some goods of his were there which could not be sent out to India and they could be sold if he, the plaintiff, approached Mr. Jajoo who was at the time in Delhi for a little while. The next witness is one Sachdev who was also examined on commission, but his evidence throws very little light on the point in issue. The other witnesses Kartar Singh P.W. 1, Sant Singh P.W. 2 and Salooja P.W. 3 do not throw any light on the question of scope of authority of Brij Lal Jajoo. This evidence therefore in my opinion is insufficient to throw on the company the responsibility for anything done or promised to be done by Mr. Jajoo.

I may here point out that the authority of every agent whether express or implied is confined within the limits of the powers of his principal and an agent of a corporation or an incorporated company cannot have any authority, express or implied to do any act on behalf of the corporation or company which is 'ultra vires', vide 'Alsop on Agency p. 46: 'Shewsbuby And Birmingham Rly. co. v. L & N W Rly. Co.', (1857) 6 H L C 113 and 'Ashbury Railway Carriage Co. v. Riche', (1875) 7 H L 653, and several other cases.

6. Counsel for the plaintiff then relied on the provisions of the Contract Act dealing with the law of Agency. He referred to Section 188 which says that an agent having authority to do an act has authority to do every lawful thing which is necessary in order to do such an act, the submission being that as it was necessary to keep the plaintiff who was a servant of the company in Okara the assurance given by Brij Lal Jajoo would be binding on the company. But as I have said the agent of a Corporation can only do that act which the corporation itself could do and which is 'intra vires' of the powers of the corporation.

7. He has then relied on Section 237 which defines the liability of an order inducing belief in third parties that agents' unauthorised acts were authorised. That section in my opinion is wholly inapplicable as there is nothing in the evidence which shows that the company did anything which could have induced in the mind of the plaintiff the belief that Brij Lal Jajoo had the authority to accept responsibility on behalf of the company for the safe custody of the plaintiff's goods and then to account for them.

8. Counsel then submitted that the company was a bailee in this case. Even if that position was correct, the proper remedy of the plaintiff would have been to sue for damages for loss caused to him by the negligence of the bailee. As a matter of fact, no case of negligence has been made out and in his statement before issues the plaintiff definitely stated that there was no entrustment and therefore the position of the defendant-company of a bailee is also untenable.

9. On the pleadings and on the evidence which has been led by the plaintiff no liability of the defendant-company has been established. I am therefore of the opinion that the learned Senior Subordinate Judge was in error in holding that the company was liable to account for the plaintiff's goods.

10. I therefore allow this appeal, set aside thejudgment and decree of the appellate Court andrestore that of the trial Court. The suit is dismissed, but the parties will bear their own coststhroughout.


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