SUPREME COURT OF INDIA
M.H. BEG, C.J.I., A.C. GUPTA AND P.S. KAILASAM, JJ.*
Juggilal Kamlapat, Appellant
Versus
Pratapmal Rameshwar, Respondent.
Civil Appeal No. 2166 of 1968
Decided on 24-11-1977.
Advocates appeared
Mr. Y. S. Chitale, Sr. Advocate and Mrs. Leila Sethi, Sr. Advocate (M/s. Praveen Kumar, Mr. Mukul Mudgal, B. P. Maheswari and Suresh Sethi, Advocates with him), for Appellant; Mr. S. K. Gupta, Sr. Advocate (Mr. S. M. Jain and Mr. B. K. Jain, Advocates with him), for Respondent.
– the term ‘delivery order’ in its natural sense would not include delivery order of the kind tendered by the plaintiff in the case of Juggilal Kamlapat v. Pratapmal Rameshwar, AIR 1978 SC 389. Hence held that pucca delivery orders were not documents of title under the Act and were not in conformity with what the parties had contracted for. See the decision in Duni Chand Rataria v. Bhuwalka Ltd., AIR 1955 SC 182. But as observed in Bayyana Bhimayya v. Government of Andhra Pradesh, AIR 1961 SC 1065, a delivery order is a document of title to goods and the possessor of such a document has the right not only to receive goods but also to transfer it to another by endorsement or delivery.
– the Supreme Court in the case of Juggilal Kamlapat v. Pratapmal Rameshwar, AIR 1978 SC 389, found it difficult to see how any alleged custom could modify the requirements of law, as to what a document of title’ is or what a particular contract is or what a particular delivery order means. It could not help a legally defective document to overcome the basic legal defect due ot its terms. It could not override the specific terms of the actual contract between the parties. It could not validate delivery orders containing reservations derogating from the legal requirements of a document of title. An alleged custom, amounting to ignoring or contravening the express terms of agreements or the operation of statutory provisions would, obviously, be invalid surely, a custom could not be pleaded as an answer to the provisions of Section 92 of the Evidence Act. The Supreme Court after considering the decisions in Duni Chand Rataria, AIR 1955 SC 182 = 1955(1) SCR 1071 : Jute and Gunny Brokers Ltd. v. Union of India, AIR 1961 SC 1214 = 1961 (3) SCR 820 and Morvi Mercantile Bank Ltd. v. Union of India, AIR 1965 SC 1954 = 1965 (3) SCR 254, felt that no case was referred which has laid down that a document purporting to be a delivery order hedged round with conditions showing that the supplier of goods had reserved the option to deliver or not to deliver unless further conditions are complied with could possibly be a ‘document of title’ as contemplated by Section 2(4). It could not authorize or purport to authorize the holder of the document to transfer the goods mentioned in it until another agreement took place. The holder might put up an equitable claim if he had actually paid some money. But he could not be compelled to pay damages for an alleged breach of contract when the delivery order was not what he had contracted for.
JUDGMENT
M.H.BEG. C.J.I. (Majority view):—I have gone through the differing judgments of my learned brethren Gupta and Kailasam. The difference arises, I find, primarily from divergent interpretations of what was pleaded by the parties. What Kailasam J. considers as having been admitted in the pleadings, by implication, was assumed by Gupta J. to be the matter put in issue by pleadings of the two sides which had to be decided.
2. After having considered the pleadings of the parties, I am unable to agree, with great respect, with my learned brother Kailasam that this case can be decided in favour of the plaintiff on the pleadings of the parties. It is true that the defendant admits the contract under which goods were to be delivered to the defendant under delivery notes to be supplied by the plaintiff for which payments were to be made by the defendant. But, that did not mean that the defendant accepted what the plaintiff alleges to be the contract between the parties with all its alleged implications. The crux of the whole matter was whether the plaintiff had carried out what it had undertaken and tendered delivery notes in respect of the contracts still left for us to consider so as to comply with the conditions of the contract really admitted by the defendant. In other words, there is a dispute on what the parties understood the contract to provide or mean. While the defendant accepts that there was a contract, he does not accept the plaintiffs version about its due compliance by the plaintiff and a breach of it by the defendant. If this had not been so there could be no dispute. The whole dispute revolved round the question: Was tender of delivery orders containing certain additional conditions according to or at variance with the contract between the parties?
3. The plaintiff realized fully that the difficulty in the way of an acceptance of its case was caused by the additional conditions sought to be attached to actual delivery by the delivery orders tendered by it, It therefore, amended the plaint by adding as follows:
"19A. The tenders made by the plaintiff of the Mills Pucca Delivery Orders as mentioned in paragraphs 9, 14 and 18 of the Plaint were duly made in terms of the Contracts between the parties. In any event the Delivery Orders tendered in respect of the Contracts mentioned in the Plaint were and are proper tenders by virtue of trade customs and usage of the Jute Trade in Calcutta. Particulars of such customs and/or usages are set out hereunder.
(i) In the Calcutta Jute market there is a usage that upon the issue be the Mills to the buyers of Delivery orders in respect of jute goods purchased, the purchasers are regarded as the owners of the goods with the right to transfer these goods by endorsing the Delivery Orders and that the Delivery Orders are regarded as documents of title to the goods covered by them.
(ii) At no time till actual delivery is give, is there any appropriation of the goods either to the Contracts or Delivery Orders, but notwithstanding the absence of the appropriation, the holders of the Mills Delivery Orders (known in the market as Pucca Delivery Orders) are regarded by the trade as the owners of the relevant goods.
(iii) That the Pucca Delivery Orders as representing the goods, pass from hand to hand by endorsement being received by the successive buyers against cash payment and are used in the ordinary course of business authorising the holder thereof to receive the goods which they represent irrespective of the forms in which the Mills Pucca delivery Orders are couched.
(iv) That the tender of Mills Delivery Orders on due date to the buyer, irrespective of the form in which they may be couched, in exchange for cash was and is a fair and valid tender under the Standard India Jute Mills Association Contract Forms, and were and are treated as such.
19B. The defendant, was at all material times fully aware of the aforesaid Trade customs and usages and dealt with the plaintiff on the basis the
Dtni Chand Ritaria v. Bhuuala Brothers Ltd.
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