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1958 Supreme(SC) 31

SUPREME COURT OF INDIA
21st March 1958
N.H. BHAGWATI, J.L. KAPUR AND P.B. GAJENDRAGADKAR, JJ.
Keshavlal Lallubhai Patel and others. Appellants
Versus
Lalbhai Trikumlal Mills Ltd., Respondents.
Civil Appeal No. 78 of 1954.
Advocates appeared
Mr. Purshottam Tricumdas, Sr. Advocate, (M/s. M. H. Chatarpati and S. S. Shukla, Advocates, with him), for Appellants ; Mr. H. N. Sanyal Addl. Solicitor-General of India, (Mr. I. N. Shroff, Advocate, with him), for Respondents.

Advocates:
H.N.SANYAL, I.M.SHROFF, M.H.Chhatrapati, PURSHOTTAM TRIKAMDAS, S.S.SHUKLA

An agreement to extend time for performance of a contract must be certain and definite.

Headnote:

CONTRACT - Extension of time for performance - Agreement to extend time - Vagueness and uncertainty - Effect.

Fact of the Case:

The appellants, a partnership firm, placed orders with the respondent, a textile mill, for the purchase of certain cotton goods. The delivery period for the goods was fixed for September and October 1942. Due to a strike in the respondent's mills in August 1942, the respondent wrote to the appellants stating that the delivery time of all pending contracts would be automatically extended for the period the working of the mills was stopped and until the normal state of affairs recurred. The strike ended in November 1942, and the appellants demanded delivery of the goods in December 1942. However, the respondent refused to deliver the goods, claiming that the contracts were void. The appellants filed a suit for damages for breach of contract.

Finding of the Court:

The trial court decreed the appellants' suit, holding that the agreement to extend time for performance of the contract was valid and enforceable. However, the High Court reversed the trial court's decision, holding that the agreement to extend time was vague and uncertain and therefore void.

Issues: 1. Whether the agreement to extend time for performance of the contract was valid and enforceable. 2. Whether the agreement to extend time was vague and uncertain.

Ratio Decidendi: 1. An agreement to extend time for performance of a contract must be certain and definite. 2. The agreement to extend time in this case was vague and uncertain because it did not specify the period for which the time for performance was extended. The condition that the time for performance would be extended "until the normal state of affairs recurred" was too vague and uncertain to be enforceable.

Final Decision: The appeal was dismissed, and the High Court's decision was upheld.

Judgment

P. B. GAJENDRAGADKAR, J. : This is an appeal by the plaintiffs against the decree passed by the High Court of Bombay dismissing their suit to recover from the defendant Rs. 1,52,334-8-9 as damages for breach of contract for non-delivery of certain cotton goods. The plaintiffs claim had been decreed by the trial court but on appeal it has been dismissed.

2. The appellants are the partners of M/s. K. B. Navinchandra and Co. This partnership had placed an order with the respondent for 251 bales of printed chints on or about July 4, 1942, and the said order had been accepted by the respondent by its letter dated July 11 and July 20, 1942. The delivery period for the said goods was fixed for the months of September and October 1942. Another order was placed by the appellants with the respondent for 31 bales of printed chints on July 24, 1942, and this order was accepted by the respondent on July 25, 1942. The delivery of these goods was to be given in the month of October 1942.

3. On August 9, 1942, the workers in the respondent mills went on strike in sympathy with the Quit-India movement which had then commenced . In consequence, the respondent wrote to the appellants firm on August 15, 1942 and stated that, in view of the strike and the political situation, the delivery time of all the pending contracts should be automatically understood as extended for the period the working of the mills was stopped and until the normal state of affairs recurred. The strike came to an end and the mills resumed working on November 22, 1942. On December 5, 1942, Jasubhai, who was then in charge of the management of the mills was approached by the appellants Keshavlal and Ratilal for obtaining delivery of the goods. He, however, told them that the appellants contracts were void and so no delivery could be claimed or given. On December 6, 1942, the said Jasubhai wrote to the appellants informing them that their contracts were not binding on the mills as they were null and void. It may be mentioned at this stage that when the contracts were made between the appellants and the respondent, Chinubhai Lalbhai was in charge of the managing agency of the mills. Subsequently, on September 18, 1942, as a result of the compromise between Chinubhai and his brothers Jasubhai and Babubhai, this managing agency of the mills fell to the share of Jasubhai and Babubhai.

4. On December 17, 1942, the appellants wrote to the respondent that, as the respondent had extended the time of delivery of all goods by its letter dated August 15, 1942, the respondent was bound to deliver the contracted goods and that, if the respondent did not do so, the appellants would be compelled to take legal proceedings against the respondent. In reply, the respondent repeated its earlier contentions by its letter dated December 20, 1942. The appellants then formally demanded the delivery of goods in January and again in February 1943, and since the demand was not complied with, the appellants filed the present suit on January 9, 1946, claiming damages to the extent of Rs. 1,52,334-8-9 with interest and costs.

5. In the plaint, it was alleged that the suit was in time because the request made by the respondent for extension of time had been accepted by the appellants. The suit was resisted by the respondent on several grounds. In particular, the respondent urged that there was no agreement between the parties with regard to the extension of time and so the suit was barred by limitation. The learned trial judge framed several issues with two of which the present appeal is concerned. These two issues related to the question of extension of time for the performance of the contract and the plea of limitation. On both these points, the learned Judge found in favour of the appellants. In the result the appellant s claim was decreed. The respondent then preferred an appeal in the High Court at Bombay and his appeal was allowed. The learned Judges of the High Court have held that the oral e


















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