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Surendra Nath Roy Vs. Kedarnath Bose and ors. - Court Judgment

LegalCrystal Citation
CourtKolkata
Decided On
Judge
Reported in161Ind.Cas.224
AppellantSurendra Nath Roy
RespondentKedarnath Bose and ors.
Cases ReferredMarsh v. Joseph
Excerpt:
contract act (ix of 1872), sections 2, 7, 197, 198 - proposal--letter signifying willingness to sell at a price in reply to enquiry if property is to be sold--whether amounts to offer--offerer directing purchaser to write about acceptance to another--purchaser putting himself in communication with him--section 7, if contravened--ratification, essentials of--proof of full knowledge of acts of agent--necessity of--appeal--appellate court, powers of--trial court not properly considering effect of documentary evidence--appellate court, if can draw conclusions of its own. - d.n. mitter, j.1. this appeal arises out of a suit for specific performance of a contract to sell. the plaintiff is. the purchaser in whose favour the contract has been entered into by defendant no. 1. the suit has been dismissed by the subordinate judge. hence the present appeal by the plaintiff. the case of the plaintiff is that defendant no. 1, kedar nath bose, who is now the owner of a portion of the house known as raja bahadur's haveli purported to sell the portion which is still left with him for a sum of rs. 7,000. the case is that the contract to sell was entered into between the present plaintiff and the son of kedar nath bose, kali das who has been described throughout these proceedings as felu whom kedar nath bose empowered to deal in the matter of the sale. the plaintiff in.....
Judgment:

D.N. Mitter, J.

1. This appeal arises out of a suit for specific performance of a contract to sell. The plaintiff is. the purchaser in whose favour the contract has been entered into by defendant No. 1. The suit has been dismissed by the Subordinate Judge. Hence the present appeal by the plaintiff. The case of the plaintiff is that defendant No. 1, Kedar Nath Bose, who is now the owner of a portion of the house known as Raja Bahadur's Haveli purported to sell the portion which is still left with him for a sum of Rs. 7,000. The case is that the contract to sell was entered into between the present plaintiff and the son of Kedar Nath Bose, Kali Das who has been described throughout these proceedings as Felu whom Kedar Nath Bose empowered to deal in the matter of the sale. The plaintiff in pursuance of certain correspondence to which reference will be made hereafter sends his kinsman and nephew Rash Behary Roy to the residence of defendant No. 1 at Calcutta, and according to the direction of defendant No. 1, he (Rash Behary) On Junuary 30, 1930, corresponding to Magh 16, 1336 B. S. having settled with Felu to purchase for Rs. 7,000, the price proposed by defendant No. 1, sent a wire to the plaintiff for sending the earnest money. Accordingly a sum of Rs. 100, was sent to Harendra, son of the plaintiff, on January 31, 1930, by telegraphic money order and Harendra and Rash Behary paid that sum of Rs. 100, to Felu as earnest money as directed by defendant No. 1, Nand Felu accepted the same. It is stated that defendant No. 1 is legally bound by the acceptance of his son who was given, if not an express at last an implied, power to deal with the matter of sale and accept any offer that would be made. The plaint then narrates certain circumstances on which the plaintiff submits that Kedar ratified the acts done by his son even if there was no express or implied authority by Kedar in the matter of sale. He has accordingly prayed for a decree for specific performance of the contract of. January 30, 1930, directing the defendants to execute a kobala of out and out sale in favour of the plaintiff free from incumbrances and to get it registered within the time to be fixed by the Court. There is an alternative prayer, namely, that in case the defendants failed to execute the kobala. within the time fixed by the Court, the Court would proceed to execute and register such a kobala in favour of the plaintiff in that behalf. The suit impleaded not only defendant No. 1, the vendor, but also defendants Nos. 2 and 3 as it is said that they are purchasers subsequent to the contract, their purchase having been effected on March 14, 1930. It is stated in the plaint that the purchase of defendants Nos. 2 and 3 was with notice of the earlier contract in favour of the plaintiff. In consequence of defendants Nos. 2 and 3 having been impleaded the plaintiff has asked for a further declaration that the kobala of March 14, 1930, corresponding to Falgoon 30, 1336 B.S. executed by defendant No. 1 in the name of defendant No. 3 one Romola Dutt Chowdhurani, wife of defendant No. 2, was not binding on the plaintiff and for a further declaration that no title had accrued to defendants Nos. 2 and 3 on the basis of the same. Defendant No. 4 is said to have been a lessee under defendants Nos. 2 and 3. But the suit as against him has been dismissed as will appear from an order in the order sheet.

2. The defences to the suit for specific performance of contract are: (1) that there was no completed contract on January 30, 1930, or on a subsequent date prior to the conveyance in favour of defendant No. 3 and that whatever talk there was between the plaintiff and defendant No. 1 or his son that talk did not pass beyond the stage of negotiation and could not constitute contract specifically enforceable, and (2) that defendants Nos. 2 and 3 are purchasers without notice. It may be said in this connection that these defendants have also set forth in their written defence a contract with an agent of defendant No. 1, namely Surendra Nath Bose who figures very largely in this case, entered into on February 1, 1930, alleging that the sale on March 14 was in pursuance of the contract of February 1, 1930, and even if it be held that there was a ratification of the agreement by Felu (son of defendant No. 1) on February 7, 1930, defendant No. 3's purchase should prevail in view of the earlier contract of February 1, 1930.

3. The Subordinate Judge has given effect to these defences and has dismissed the suit. The plaintiff has consequently preferred the present appeal and Mr. Atul Chandra Gupta for the appellant has contended before us that the Subordinate Judge should have held that the contract set up by the plaintiff dated January 30 was a valid contract with defendant No. 1 by which he agreed to sell the properties now in question. It is contended, that he should have further held that Felu, the son of Kedar, was empowered by Kedar to accept any offer that Felu could get and that he did really accept the offer by receiving Rs. 100 by way of earnest money. It has been further argued that apart from the question of Felu's authority to accept the offer and to receive the earnest money the Subordinate Judge should have held that Kedar ratified the acceptance of the offer of the plaintiff by Felu. It has been further contended that in so far as the defendants' case with regard to the contract executed by the Am-mukhtear of the plaintiff, Surendra Nath Basu dated February 1, 1930, is concerned, the agreement entered into on that date was really an ante-dated agreement for defeating the rights of the plaintiff. In order to consider the soundness or otherwise of these contentions on which Mr. Atul Chandra Gupta purposes to rest the appeal on be half of this client it is necessary to refer to the oral and the documentary evidence which has been given in this case on behalf of both the parties. In support of the contention of the appellant that there has been a valid contract between them, the plaintiff and defendant No. 1 on January 30, 1930, our attention has been drawn to two letters, namely, Ex. 1, dated January 24, 1930. and Ex. 3 dated January 26, 1930, which have been printedat pp. 7 and 8 of the second part of the paper-book respectively. It appears that on January 24, 1930, the present plaintiff wrote to defendant No. 1 to the following effect. It is only necessary to quote the material portion. The plaintiff writes thus: 'The news for the present is that I hear that you would sell your house in Raja Bahadur's Haveli at Barisal and that some one would come here on Magh 14, and settle the terms thereof (i.e., Magh 14, corresponding to January 28, 1930). I spoke to my maternal uncle, Khitish Chandra Roy about this matter... I am ready to purchase that house. I hope that the terms of sale may not be settled without informing me. On arrival at Barisal I may be enquired for at the house of my father-in-law, Biseswar Ghose. Or if you or Felu come to Barisal, please put up at our house.'

4. This letter was received by defendant No. 1 on January 26, at about 6-30 p.m. or 7 p.m. and in answer to that Ex. 3 the postcard was written by Kedar Nath Bose which contains certain important statements:

Glad to receive your letter. I am. going to attend the Kumbha Mela at Allahabad by to-night's train. Yes, I shall sell such portion of the Raja Bahadur's house that I now have. I have got an offer up to Rs. 6,500. I intend to have Rs. 7,000. If you are willing to have it, write to Felu to this address. There is no certainty as to when I shall return. As a matter of fact, nothing short of Rs. 6,500, the offer I have already got, will do; be it whatever in excess. Two or three persons have off wed that price.

5. It is contended on behalf of the appellant that this was an offer by Kedar Nath Bose to sell Raja Bahadur's Haveli or rather such portion of it as has not been sold, for a sum of Rs. 7,000. On the other hand it has been contended on behalf of the respondents that this was not an offer at all within the meaning of Section 2, Contract Act, but that was merely an invitation to an offer. We do not think that we should accede to this contention raised on behalf of the respondents for Section 2(a) states this:

When one person signifies to another his willingness to do or to abstain from doing anything, with a view to abstaining the assent of that other to such act or abstinence, he is said to make a proposal.

6. Kedar, defendant No. 1, was by this letter signifying his willingness to sell a portion of the Raja Bahadur's Haveli now in queslion for a sum of Rs. 7,000, and he was communicating his willingness to sell for Rs. 7,000 to the present plaintiff by this letter. We have therefore no hesitation in repelling the contention made both by the learned Advocates for defendants Nos. 1, 2 and 3. This was really an offer or rather a proposal within the meaning of Section 2, Contract Act. It appears from the evidence that in pursuance of this letter which was received in Barisal on January 28, 1930, in the morning at about 7-30 a.m. which must have been delivered to the plaintiff say by 9 a.m. The plaintiff sends his son one Harendra and a relation Rash Behari, as has been mentioned in the plaint to see Felu, the son of Kedar Nath Bose, defendant No. I. The evidence is that Felu expressed his intention to accept the offer of Rs. 7,000 for the house and asked 'that earnest money should be paid. Evidence does not show that he named any sum for the earnest money.

7. But the evidence of Rash Behari is that he asked for a sum of Rs. 100 which came by telegraphic money order and this sum was paid to Felu. The Subordinate Judge has hesitated to believe this part, of the. case because no receipt for Rs. 100 had, been produced. No doubt the non-production of any receipt is a weak part of the, plaintiff's case, but an explanation has been given by the son as well as by Rash Behari. that they did not out of a sense of delicacy ask for any receipt as both the plaintiff, and defendant No. 1 are relations, and it is very likely that Harendra was merely handing over the earnest money of the small amount of Rs. 100 without asking for a receipt as he was not sufficiently experienced in wordly affairs. As such he did not perhaps chocse to ask for any receipt from are lation of his. It has been said, and in our opinion rjghtly said, that the case of want of consideration for the non-production of the receipt of Rs. 100 has been unduly stressed. In support of this payment we have the evidence of Rash Benari. We have evidence also of the two Pleaders Lal Mohan Chakravarty end Charu Chandra Roy who state, that Surendra Nath Bose, the agent of Defendant No. 1, admitted before them the receipt of the earnest money of Rs. 100. I might just refer in this connection to the evidence of these two. witnesses which is printed at pp. 164 and 169 of the first part of the paper-book respectively Charu Chunder Roy says this:

Surendra Nath Bose told me when the measurements took place that the price had been settled at Rs. 7,000. Surendra Bose told me near the shop of Srish Roy that Rs. 100 had been paid as earnest money.

8. Lal Mohan Chakravarty says this on the point:

Surendra Bose told Charu Babu that he would find the description of the property and the boundaries from Srish Babu's kobala and asked Charu Babu to state in the draft that Rs. 7,000 had been fixed as the consideration and that out of that sum Rs. 100 had been received as earnest money.

9. Having regard to the evidence of these two Pleaders to the fact that there was some payment of money by the plaintiffs' son to defendant No. 1, we think we should not be justified in rejecting the oral evidence on the question that the sum had been paid more particularly as it appears from the telegraphic, money order that a sum of Rs. 100 had been sent by the plaintiff and received by the plaintiff's son in Calcutta. It has been suggested on behalf of the respondents that the telegraphic money order to Rash Behari at Calcutta was sent for the purpose of creating evidence of the payment of the' sums for use at a later date. The reason suggested for such a course is that when on the Magh 14, corresponding to January 28, the plaintiff found that a contract was going to be entered into on February 1, with defendants No. 2 and 3 and everything had been settled with reference to the contract of defendant No. 3 and defendant No. 2 this telegraphic money order was sent in order to create evidence in order to avail of the sum when occasion demanded. It is next contended on behalf of the appellant on this part of the case that the learned Subordinate Judge ought to have read the facts of this case in the light of the subsequent conduct of the parties some of which are evidenced by some of the letters proved in this case. With regard to Felu's authority it is said that some of the letters which passed between the plaintiff and Kedar Nath Bose, throw considerable light and support the case made in the plaint. We are referred in this connection to the letter of February 7, 1930, which has been marked as Ex. 8, and printed at p. 29 of the second part of the paper-book, written by Kedar Nath Bose to the plaintiff. This letter is admitted to have been written by defendant No. 1. Some of the passages in this letter have to be quoted in extenso for they have been referred to for he purpose of showing that by this letter of February 7, 1930, there was ratification of the acts of Felu and that the letter is the evidence of the fact that Felu was given an implied authority to deal with the matter of sale. I will only quote the material portion. The letter runs thus:

Glad to receive your letter. I have returned from Kumbha only these 3 days since. I don't know what conversations there were with you. But when Sriman Felu has given his word, then action will be taken accordingly. The papers relating to that house are with my officer at home. Letter has been written to him to come with these papers. There is also a power-of-attorney in his name. He will be able to get it (kobala) registered.

10. Towards the end and in the last paragraph it is stated thus:

It is impossible for Sriman Felu to go to Barisal and get the document registered, because he is the cashier of a Bank and can on no account get leave. If you think it necessary to have it registered by me it will have to be registered at Calcutta. It involves an extra expenditure of Rs. 10 only. Consideration money will have to be paid to me here. No efforts will be spared to complete the transaction at an early date.

11. The letter or at any rate the passage which has just been quoted lends support to the case made by the plaintiff that Kedar gave authority to his son Felu to deal with the matter of contract of sale in question. At any rate this letter acknowledges the existence of such a contract. This letter also shows as has been contended for on behalf of the appellant that there has been in any event ratification of the act of Felu by defendant No. 1. Dealing first with the question of implied authority it appears clear from this letter that Felu was given authority to complete the transaction in connection with the sale of Raja Bahadur's Haveli. The words 'but when Sriman Felu has given his word then action will be taken accordingly,' can lead to but one inference that by the previous letter Ex. 3, the past card writen by Kedar to the plaintiff, authority was given impliedly to Felu to deal with the contract or any offer in respect of the sale now in question. Having regard to what we have found, namely, that this letter of February 26, Ex. 8, was followed by the coming up of Rash Behari to Calcutta with the son of the plaintiff Harendra, and by his conversation with Felu about the earnest money of Rs. 100, we have no doubt in our mind that it was a valid and binding contract between the plaintiff and defendant No. l's agent or son Felu with reference to the sale question for a sum of Rs. 7,000.

12. The payment has been proved by the evidence to which reference has already been made including the evidence of the two pleaders of Barisal. The burden of proving this was undoubtedly on the plaintiff and he has discharged that burden by such evidence as he has given which we consider prima facie proof. It was open to the defendant to rebut the prima facie proof by production of the best evidence in the case. It might have been proved by the production of the jama kharach papers of defendant No. 1 that there was absence of any entry of the payment of Rs. 100. Notwithstanding the existence of' these jama kharach books they were not produced; and an unfavourable inference has to be drawn in respect of this payment against defendant No. 1 having regard to the admissions made by his agent Surendra. It remains to consider with regard to the question of the contract an argument which has been advanced by Dr. Sen Gupta who has appeared for defendant No. 1 and which is founded on the provisions of Section 7 of the Contract Act. It is said that there has been no acceptance of the offer by defendant No. 1 seeing that the acceptance by the plaintiff was not made in the way indicated in the letter of defendant No. 1, Ex. 3, dated January 26, 1930. It is said by this letter that the only manner in which the acceptance of the offer could be made was by writing to Felu at the Calcutta address of defendant No. 1 and by no other means; and we are referred to Section 7, the material portion of which runs as follows: 'In order to convert a proposal into a premise the acceptance must (1) be absolute and unqualified, (2) be expressed in seme usual and reasonable mariner, unless the proposal prescribes the manner in which it is to be accepted... '

13. The rest of the section is not material for our present purposes. We have to read this letter in a reasonable and in a sensible manner. When it is said in this letter that the intending purchaser will have to write to Felu it certainly did not exclude the case where the intending purchaser instead of writing to Felu put himself into communication with Felu and that is exactly what the intending purchaser in the present case did. We do not therefore think that there has been any contravention of Section 7, Contract Act, in this case so as to render the contract not binding upon defendant No. 1. Assuming for the purpose of the argument that there, was no implied authority in Felu to complete the transaction of sale or to accept any offer, which is made by the intending purchaser of Raja Bahadur's Haveli, we have ho doubt on the correspondence, which we will presently set forth that there has been a ratification of the acts of Felu by defendant No. 1 and we have no doubt also, nor can there be any doubt, that defendant No. 1 has adopted the acts of Felu in this behalf as his own. This brings us to refer to the correspondence evidenced by the post card, Ex. 8, dated February 7, 1930, where Kedar is writing to the present plaintiff this:

Glad to receive your letter. I have returned from Kumbha only these three days since. I don't know what conversations there were with you. But when Sriman Felu has given his word, then action will be taken accordingly. The papers relating to that house are with my officer at home. Letter has been written to him to come with these papers. There is a power-of-attorney in his name. He will be able to get it (kobala) registered.

14. Then follows another passage winch has already been quoted and which concludes by saying: 'No effort will be spared to complete the transaction at an early date.' In our view, by this letter, Kedar was adopting the acts of his son and was ratifying his acts in this behalf. It has, however, been argued on behalf of the respondents that there can be no ratification unless the person ratifying had full knowledge of the facts and our attention has been drawn to the provisions of Sections 197 and 198, Contract Act. Section 197 runs as follows:

Ratification may be expressed or may be implied in the conduct of the person on whose behalf the acts are done.

15. Section 198 is to the following effect:

No valid ratification can be made by a person whose knowledge of the facts of the case is materially defective.

16. It has been sought to be argued that when this letter of February 7, 1930, was written Felu was not in Calcutta and that therefore Kedar was writing this, having regard to what was represented to him in a letter written by the plaintiff Surendra Nath Roy of which this letter of February 7, 1930, is a reply. It is difficult to accede to this contention that Felu was not in Calcutta at that time. The last paragraph of the letter which states that 'it is impossible for Sriman Felu to go to Barisal' negatives the alleged fact that Felu was cut of Calcutta. Besides, Felu works in a certain Bank and the best evidence as to his absence from Calcutta on February 7, 1930, would have been the production of the Bank attendance bock. But even assuming that Felu was absent and that defendant No. 1 acted on what was, represented to him in the letter it appears clear that Kedar did not enquire into the matter as he should have done and in such circumstances it. would he nonetheless a ratification of his acts and he should be taken to have knowledge of all the circumstances because he himself did not care to enquire. The rule of law in this behalf has been very lucidly stated in the decision which has been cited at the Bar in Marsh v. Joseph (1897) 1 Ch 213 : 66 L J Ch 128 : 45 W R 209 : 75 L T 558. In the judgment of Lord Russell at p. 246 Page of (1897) 1 Ch.--[Ed.] of the report the following relevant passage occurs :

To constitute a binding adoption of acts a priori unathorized, these conditions must exist: (1) the acts must have been done for and in the name of the supposed principal and (2) there must be full knowledge of what those acts were or such an unqualified adoption that the inference may properly be drawn that the principal intended to take upon himself the responsibility for such acts whatever they were.

17. Then again at p. 247 Page of (1897) 1 Ch.--[Ed.] of the report the learned Lord Chief Justice observes thus:

Where the supposed ratification relates to acts as to which there is no pretence of any priori authority, as in this case, where it is not a question merely of excess of authority, full knowledge of the facts and unequivocal adoption after such knowledge must be proved, or, in the alternative, the circumstances of the alleged ratification must be such as to warrant the clear inference that the principal was adoping the supposed agent's act whatever they were or, however, culpable they were.

18. It appears to us clear from a persual of the letter of February 7,1930, that Kedar was adopting in full the acts of Felu when he said that when Felu has given his word then action will be taken accordingly. He even went so far as to say that there would be no delay in completing the transaction which had been entered into by the son and that there would be no difficulty regarding the registration of the same. Then again ratification relates back to the. time of the inception of the transaction and has a complete retrospective efficacy: (see Story on Agency, Edn. 9, p. 244); that Kedar knew all the circumstances would appear from another letter dated February 16, 1950, which has been marked as Ex. (16) in the case and which is printed at p. 31 of the second part of the paper-book. It is true that this letter has not been admitted by him but according to the Subordinate Judge it was written by Kedar. We have examined the letter, the post card in original and have compared it with the writing of Kedar in the other admitted letters and indeed Kedar has been forced to admit in cross-examination that the writing in the post card resembles his handwriting. The significant passage in this letter which proves ratification is this:

I hear that my son has given word to somebody. He is not here at present. He will come within a day or two. If he has given any final words, then I shall have to be bound by that. I do not concern myself, with any affairs of the estate nor I consider it necessary. I simply take my morning and evening meals and, move about here and there. I can speak to him if you let me know the amount you are ready to pay, but then I shall not be able to do anything against his wishes.

19. This letter was addressed to another intending purchaser, one pleader who has given his evidence in this case, named Uma Kanta Kanjabilla. There has been some discussion as to the accuracy of the translation of this letter with reference to the expression 'final word' in line about 25 of p. 31 of the second part of the paper-book. We have had the original read to us and we have no doubt that Kedar was speaking there in a legal language when he said: 'If he has given any final word, then I shall have to be bound by that.' Strenuous endeavour has been made both by Dr. Basak who appears on behalf of defendant Nos. 2 and 3 and Dr. Sen Gupta who appears for defendant No. 1 in persuading us to hold that the expressions 'final word', 'action will be taken accordingly' and the further expression 'I shall have to be bound by that' are not words of legal obligation but are words expressive of moral obligation. But no question of moral obligation arises when Kedar was speaking about a contract for sale of a house in answer to an inquiry by Uma Kanta, an intending purchaser with regard to the completion of a legal transaction. In order to substantiate this contention of behalf of the defendants and in order to convert these words into moral obligation, something else would have to be read into them, which is not permissible. For these reasons we are of opinion that, there has been complete ratification of the acts of Felu by Kedar Nath Basu, defendant No. 1 and on this ground the contract mist bo sustained. It brings us now to consider tire earlier contract of February 1, 1910, which has been sot up on behalf of defendants Nos. 2 and 3. (His Lordship after discussing the evident proceeded). We are not surely unmindful of what has bean repeatedly said by the Privy Council that where the issue is a simple one the Appellate Court should not very lightly discard the appreciation of evidence made by the trial Court which had the opportunity of seeing the witnesses, hearing them and watching their demeanour, but in the present case the weight of the admitted documents in evidence, or the documents in evidence which have been proved, is so great that we are constrained to differ from the estimate of the evidence by the Subordinate Judge who has really belittled the effect of the documentary evidence and we have no hesitation in coming to the following conclusions in this case: (I) that Felu was given an implied authority by defendant No. 1 to enter into a contract in reference to the sale in respect of which the suit for specific performance had been instituted; assuming in the alternative that he had no such authority, there has been ample ratification by defendant No. 1 of his contract by his letter of Feburary 7, 1930; (3) that the payment of Rs. 100 was made by the plaintiff's son to Felu as alleged and that Felu accepted the money according to the directions of defendant No. 1(4) that the alleged contract of Feburary 1, 1930, was not really entered into on that date but at a much subsequent date after Surendra Bose had come to Calcutta and that the subsequent conduct of defendant No. 1 bears traces of the influence and very considerable influence of his agent.

20. On these conclusions we think that the decision of the Subordinate Judge must be set aside and the decree of the Subordinate Judge dismissing the suit must also be set aside and the plaintiff must be given a decree in terms of the prayers which he has set forth in the plaint which is to be found printed at p. 32 of the first part of the paper-book. The plaintiff will have costs both of this Court and also of the Court below. The costs are to be recovered from defendant No. 1 and defenddants Nos. 2 and 3, in equal proportions. The plaintiff must bring into Court below the sum of Rs. 6,900 within a month from this date which event happening, the Court below will proceed to pass the decree in accordance with prayers Ka, Gha, Uma and Cha of the plaint. In the event of such payment being made, the Court below shall proceed to execute a kobala in favour of the plaintiff and have it registered within two weeks from the date of payment of the money and in that event also defendants Nos. 2 and 3 will be able to take out the whole amount of Rs. 6,900 as it has been conceded on behalf of defendant No. 1 that defendants Nos. 2 and 3 have paid the purchase money. The appeal is allowed with costs and the cross-objection is dismissed. No order is made as to costs of the cross-objection. Let the record be sent down as early as possible.

Patterson, J.

21. I agree.


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