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Ramother and Co., Represented by Its Partner, Ramother S/O Kabulchand Vs. Rameshchandra Sureschandra and Co., by Proprietor, Rameshchandra B. Takzania - Court Judgment

LegalCrystal Citation
SubjectContract
CourtChennai High Court
Decided On
Reported in(1992)2MLJ113
AppellantRamother and Co., Represented by Its Partner, Ramother S/O Kabulchand
RespondentRameshchandra Sureschandra and Co., by Proprietor, Rameshchandra B. Takzania
Cases ReferredB.G. Kedia v. Girdharilal
Excerpt:
- .....gopalji and company, bombay offered to purchase on behalf of the defendant six wagon loads of bombay quality tapioca starch at rs. 59 per 50 kg. of f.o.r. at angadipu-ram or palghat. the plaintiff received a letter on or about 24.2.1978 sent by the said m/s. dalal jayanthilal gopalji and company, bombay, dated 21.2.1978, stating that he had sold on behalf of the plaintiff six wagon loads of tapioca starch snow white full paste. the plaintiff wrote a letter to m/s. dalal jayanthilal gopalji and company, bombay, that he never offered to supply goods of the variety mentioned in his letter dated 21.2.1978 but he offered only to supply bombay quality tapioca starch at rs. 59 per 50 kg. after receiving the letter m/s. dalal jayanthilal gopalji and company, bombay called the plaintiff over.....
Judgment:
ORDER

Somasundaram, J.

1. The plaintiff in O.S. No. 610 of 1978 on the file of the Sub Court, Salem is the petitioner in this civil revision petition. The defendant in the said suit is the respondent in this civil revision petition. For the sake of convenience the parties are referred to in this order as per the nomenclature given to them in the suit.

2. The plaintiff filed the suit O.S. No. 610 of 1978 on the file of the Sub Court, Salem against the defendant for recovery of a sum of Rs. 8040 as damages for the breach of contract. The case of the plaintiff is as follows:

The plaintiff-firm is doing business in sago, starch and allied products at Salem. The defendant is a proprietary concern doing business in sizing and chemicals at Sivaganj, Indore. On or about 20.2.1978 M/s. Dalal Jayanthilal Gopalji and Company, Bombay offered to purchase on behalf of the defendant six wagon loads of Bombay quality tapioca starch at Rs. 59 per 50 Kg. of F.O.R. at Angadipu-ram or Palghat. The plaintiff received a letter on or about 24.2.1978 sent by the said M/s. Dalal Jayanthilal Gopalji and Company, Bombay, dated 21.2.1978, stating that he had sold on behalf of the plaintiff six wagon loads of tapioca starch snow white full paste. The plaintiff wrote a letter to M/s. Dalal Jayanthilal Gopalji and Company, Bombay, that he never offered to supply goods of the variety mentioned in his letter dated 21.2.1978 but he offered only to supply Bombay quality tapioca starch at Rs. 59 per 50 Kg. After receiving the letter M/s. Dalal Jayanthilal Gopalji and Company, Bombay called the plaintiff over the phone and requested him to send six wagon loads of Bombay quality tapioca starch to the defendant to Indore. The plaintiff accepted the offer of M/s. Dalal Jayanthilal Gopalji and Company, Bombay on behalf of the defendant and agreed to supply Bombay quality stretch to the defendant at Rs. 59 per 50 kg. On the plaintiff accepting at Salem the offer of M/s. Dalal Jayanthilal Gopalji and Company, Bombay on behalf of the defendant for the supply of goods to the defendant the contract was completed at Salem on 27.2.1978 the plaintiff caused between 11.3.1978 to 13.3.78 four wagon loads of Bombay quality tapioca starch to be despatched from Palghat to Indore and he caused the invoice for 111 bags of loads to be sent by the Chemical Starch Factory and for 220 bags by P.V. Brothers Starch Industrials and for two more wagons by Leenith Starch Factory. The defendant, after waiting for several days sent a telegram on 1.4.1978stating that the wagons had been unloaded and the quality of goods despatched were inferior in quality than the one contracted for. The plaintiff sent his representative Chainraj to Indore to look into the matter and on 6.4.1978 the said Chainraj inspected the goods at Indore, found the allegations of the defendant that the goods are of inferior quality are false and thereafter he sold the goods at the risk of the defendant and realised a sum of Rs. 64, 125 and the plaintiff on account of the breach of contract committed by the defendant suffered a loss of Rs. 8040 which he claimed as damages in the suit.

3. The defendant resisted the suit contending inter alia that the defendant-firm carry on business at Indore in Madhya Pradesh and the proprietor of the defendant-firm voluntarily works and resides at Indore and that the offer and acceptance for the supply of the Bombay quality tapioca starch was negotiated by M/s. Dalal Jayanthilal Gopalji and Company, Bombay on telephone and the contract was concluded only at Indore and as no part of cause of action for the suit arose within the jurisdiction of the Sub Court, Salem, thesaid Court has no jurisdiction to entertain the suit.

4. The trial court framed the following issue on the question of jurisdiction:

Whether the Court has no jurisdiction to entertain the suit for the reasons set forth in the written statement of the defendant?

The trial court tried the above issue with regard to the jurisdiction as preliminary issue and found that the Sub Court, Salem has no jurisdiction to entertain the suit as no part of cause of action for the suit arose within the jurisdiction of the Sub Court, Salem. Consequently the trial court returned the plaint to the plaintiff for representing the same to the proper court. The plaintiff filed an appeal C.M.A. No. 105 of 1983 before the District Court, Salem. The appellate Court confirmed the finding of the trial court that no part of cause of action arose at Salem and dismissed the appeal. Aggrieved by the judgment of the lower appellate court the plaintiff has filed the present civil revision petition.

5. The only point argued by Sri T. Chengalvorayan learned Counsel for the plaintiff is, that the contract for the supply of Bombay quality tapioca starch was concluded by offer and acceptance made over the phone; by the letter, Ex.A-2, the plaintiff offered to sell Bombay quality tapioca starch to the defendant's agent M/s. Dalal Jayanthilal Gopalji and Company, Bombay; the defendant's agent M/s. Dalal Jayanthilal Gopalji and Company, Bombay called the plaintiff over the phone from Bombay and accepted the offer of the plaintiff made in Ex.A-2 to supply Bombay quality tapioca starch; the acceptance was made over the telephone at Bombay by M/s. Dalal Jayanthilal Gopalji and Company on behalf of the defendant and the same was communicated to the plaintiff at Salem and, therefore, the contract for the supply of goods was concluded at Salem. Learned Counsel further contended that as the contract was concluded at Salem, a part of the cause of action for the suit arose at Salem, and, therefore, the sub-court, Salem has got jurisdiction to entertain the suit. The contention of the learned Counsel for the plaintiff cannot be accepted because factually the contention of the learned Counsel for the plaintiff runs counter to the averments made in the plaint. In para 5 of the plaint the plaintiff has specifically stated as follows:

After receiving the letter M/s. Dalal Jayanthilal Gopalji and Company, Bombay called the plaintiff over the phone and requested him to send 6 wagon loads of Bombay quality topioca starch to defendant to Indore instead the tapioca mentioned by him in his letter dated 21.2.1978. The plaintiff accepted this offer of M/s. Dalal Jayanthilal Gopalji and Company, of Bombay on behalf of defendant and agreed to supply Bombay quality tapioca starch to the defendant at Rs. 59 per 50 Kgs. For Angadipu-ram or Palghat. On the plaintiff accepting this at Salem the offer of M/s.Dalal Jayanthilal Gopaljiand Company of Bombayon behalf of defendant for the supply of the goods to defendant, the contract was completed at Salem on 27.2.1978.

Further in para 17 of the plaint the plaintiff has also stated that the cause of action for the suit arose on 27.2.1978 when the plaintiff was at Salem through phone to send 6 wagons of quality tapioca starch to Indore. In para 18 of the plaint the plaintiff has further stated that even though the defendant is residing beyond the jurisdiction of the lower court as the contract to supply the goods was completed at Salem, a part of cause of action has arisen within the jurisdiction of the lower court and, therefore, the lower court has got jurisdiction to entertain the suit. A perusal of the averments in para 5, 17 and 18 of the plaint go to show that the offer was spoken by the defendant's agent M/s. Dalal Jayanthilal Gopalji and Company at Bombay over the telephone and the acceptance was spoken by the plaintiff over the telephone at Salem and the acceptance in this case was complete only when it was actually communicated to the defendant's agent M/s. Dalal Jayanthilal Gopalji and Company, at Bombay. On the basis of the averments made in the plaint it is clear that the acceptance in this case was complete and the contract was concluded between the parties for the sale of Bombay quality tapioca starch only when the words of acceptance spoken by the plaintiff over phone at Salem was actually communicated to the defendant's agent at Bombay. This is the only conclusion that can be reached on the basis of the specific averments made by the plaintiff paras 5, 17 and 18 of the plaint.

6. The Supreme Court in B.G. Kedia v. Girdharilal : [1966]1SCR656 , dealing with the question where the acceptance of an offer is made over telephone, when acceptance is complete and where the contract is concluded, whether it is complete at the place where acceptance is spoken or at the place where the acceptance is heard, held that when an offer of acceptance is made over telephone, the acceptance is complete only when it is communicated to the other party and the acceptance is complete and a contract is concluded at the place where the acceptance is heard by the person to whom the acceptance is made. The Supreme Court in the above decision has observed as follows:

Obviously the draftsman of the Indian Contract Act did not envisage use of the telephone as a means of personal conversation between parties separated in space, and could not have intended to make any rule in that behalf. The question then is whether the ordinary rule which regards a contract as completed only when acceptance is intimated should apply, or whether the exception engrafted upon the rule in respect of offers and acceptances by post and by telegrams is to be accepted. If regard be had to the essential nature of conversation by telephone, it would be reasonable to hold that the parties being in a sense in the presence of each other, and negotiations are concluded by instantaneous communication of speech, communication of acceptance is a necessary part of the formation of contract, and the exception to the rule imposed on grounds of commercial expediency is inapplicable.

The trial court was therefore right in the view which it has taken that a part of the cause of action arose within the jurisdiction of the City Civil Court, Ahmedabad, where acceptance was communicated by telephone to the plaintiffs.

7. In view of the above settled position of law, it has to be held that the acceptance spoken by the plaintiff over the phone from Salem was complete and a contract was concluded only when the acceptance was communicated to the defendant's agent at Bombay and that the contract between the parties was concluded only at Bombay where the acceptance was communicated to the defendant's agent and not at Salem where the acceptance was spoken over the phone. As the contract in this case was not concluded at Salem and no part of cause of action for the suit arose at Salem, the Sub Court, Salem has no jurisdiction to entertain the suit. In these circumstances, the court below rightly held that no part of the cause of action for the suit arose within the jurisdiction of the Sub Court, Salem and the trial court has no jurisdiction to entertain the suit. There are no merits in the civil revision petition and the same is liable to be dismissed. Accordingly, the civil revision petition is dismissed. No costs.


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