A contract is not discharged by frustration merely because its performance has become unlawful for a temporary period.

Judgment

MUDHOLKAR, J.: -This appeal, like Satyabrata Ghose v. Mugneeram Bangur and Co., 1954 SCR 310 relates to the effect of requisitioning orders made by the Government during the last war under which they took possession of land belonging to the appellant company which had been divided into building plots by them in pursuance of what is known as the Lake Colony Scheme, by constructing roads and drains. The plaintiff-respondent was one of the various persons who had entered into contract with the company for purchase of plots in pursuance of the public offers made by the company. This he did by addressing the following letter to the company and paying Rs. 202 by way of earnest money.

"To

Mugneeram Bangur and Company Land

Department, Russa Road, South,

Tollygunge, Calcutta, No. 499,

Phone : South 135.

Through Babu-

Re : Plots Nos. New Nos. 245 and 246 on 30 feet road in the premises No. Lake Colony Scheme No. 1, Northern Block.

Area measuring--10 Ks. x ch. x sqr. ft. more or less.

Dear Sir,

I am willing to purchase the above plot of land from you at the average rate of Rs. 1,075 (Rupees one thousand and seventy-five only) per katta irrespective of the condition of the soil and I am ready to deposit Rs. 202 of the actual value as an earnest money at once. I undertake to complete the transaction within one month from the date on (?) (of) completion of road payment of the balance of the consideration money and time must be deemed as essence of the contract. If I fail to do so within the said period the earnest money deposited by me will be forfeited and you will be free to resell the land and I shall be liable for all damages that may result thereby. I also agree to sign a formal agreement in the form required by you if you so desire.

Yours faithfully,

Name, Gurbachan Singh,

Address : 48/1, Chakraberia Road, North.

Date the.............19.......

Witness: (Illegible).

Address.....................

N. B. I agree to pay half of the value at the time of registration of the deeds and the balance with 6 years bearing interest at the rate of 6 per cent per annum with half yearly rests and the said plots Nos. 245 and 246 purchased by me shall remain charged for the payment of the balance of the purchase money in manner at aforesaid and the necessary security deed charged should be executed and registered by me at my own cost.

Name: Gurbachan Singh

Address............

Witness (Illegible) .

4. Baktiar Shah Road, Tollygunge.

2. The letter does not bear any date; but probably it was written on May 14, 1941 which is the date on which the company issued a receipt in his favour. Different portions of the land covered by the scheme were requisitioned by Government between November 12, 1941 and July 25, 1944. The plots which the respondents had contracted to purchase are said to form part of the land which was requisitioned by virtue of an order made by the Government on February 18, 1944.

3. According to the company, on December 24, 1943, a circular notice was sent to all those persons who had entered into contracts for purchase of plots from them stating that a considerable portion of the land, comprised in the Lake Colony Scheme area had been requisitioned under the Defence of India Rules and was taken into possession the Government. It was not possible to say how long the Government would continue to be in possession and, therefore, it was not possible for the company to carry on the work of the construction of roads and drains during the continuance of the war and possibly for many year even after the termination of the war. The circular then proceeded to state as follows:

"In these circumstances we have decided to treat the agreement as cancelled and give you the option of taking of the refund of the earnest money deposited by you within one month from the receipt of this letter.

In the event of your refusal to treat the contract as cancelled, we are offering you, in the alternative, to complete the registration of the conveyance of the sale-deed within one month f