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HIGH COURT OF CALCUTTA
P. B. Mukharji
ANATH BANDHU DEB - Appellant
Versus
DOMINION OF INDIA - Respondent
Suit 2391 Of 1948
Decided On : JULY 11, 1955
CONTRACT - FORMALITIES - GOVERNMENT CONTRACT - ENFORCEABILITY - MISTAKE OF LAW - UNJUST ENRICHMENT - JURISDICTION.
Fact of the Case:
Plaintiff paid Rs. 12,161/- to the Government for the purchase of bricks but the Government failed to deliver the bricks. Plaintiff sued for a refund of the amount paid.
Finding of the Court:
1. The contract was not enforceable against the Government as it did not comply with the statutory requirements of Section 175 (3), Government of India Act, 1935 (now Article 299 of the Constitution). 2. Plaintiff's claim for refund under Section 70, Contract Act, was not maintainable as the payment was not "lawfully" made. 3. Plaintiff's claim under Section 65, Contract Act, was not maintainable as the agreement was not void or voidable. 4. Plaintiff's claim under Section 72, Contract Act, for mistake of law was not maintainable as the mistake was not genuine but rather a disregard of the law. 5. The Rights, Property and Liabilities Order, 1947 did not apply as the contract was not made on behalf of the Governor-General in Council. 6. The Court had no jurisdiction to entertain the suit as no part of the cause of action arose within its jurisdiction.
Issues: 1. Whether the contract was enforceable against the Government. 2. Whether plaintiff was entitled to a refund under Section 70, Contract Act. 3. Whether plaintiff was entitled to a refund under Section 65, Contract Act. 4. Whether plaintiff was entitled to a refund under Section 72, Contract Act. 5. Whether the Rights, Property and Liabilities Order, 1947 applied. 6. Whether the Court had jurisdiction to entertain the suit.
Ratio Decidendi: 1. A contract with the Government must comply with the statutory requirements of Section 175 (3), Government of India Act, 1935 (now Article 299 of the Constitution) to be enforceable against the Government. 2. Payment made in disregard of the law is not "lawfully" made and cannot be recovered under Section 70, Contract Act. 3. An agreement that is not void or voidable cannot be the subject of a claim for refund under Section 65, Contract Act. 4. A mistake of law that is not genuine but rather a disregard of the law cannot be the basis for a claim for refund under Section 72, Contract Act. 5. The Rights, Property and Liabilities Order, 1947 does not apply to contracts that are not made on behalf of the Governor-General in Council. 6. A Court has no jurisdiction to entertain a suit if no part of the cause of action arose within its jurisdiction.
Final Decision: Suit dismissed.
( 1 ) THIS is plaintiff's action against the Union of India for the recovery of two sums of money, one for Rs. 12,161/- and the other for damages amounting to Rs. 49,186-8-0 As the suit was instituted in 1948, the original defendant) named was the Dominion of India. The plaintiff has give up his claim for damages for Rs. 49,186-8 and that is recorded. The suit, therefore, is now only for the recovery of Rs. 12,161/ -. That is the only issue.
( 2 ) THE plaintiff claims this sum of Rs. 12,161/-on the ground that it paid this sum to the Government as the purchase price of certain bricks from the Government The plaintiff alleges that the Government failed to deriver the bricks. The plaintiff, therefore, claims refund of the sum of Rs. 12,161/ -.
( 3 ) THE facts of the case are short and simple. The plaintiff pleads that towards the end of June or the beginning of July, 1946 the Governor-General in Council for undivided India invited benders for the purchase of surplus bricks and brickbats in the Agartolla area in the State of Tipperah. The plaintiff tendered for such purchase. His tender was accepted. On 12-7-1949 ho deposited the entire purchase price of Rs. 12,161/- at the Tipperah Treasury by Chalan No. 15. The plaintiff pleads that the Governor-General in Council failed and neglected to deliver to the plaintiff the said bricks or any portion thereof and, therefore, he is entitled to a refund of this sum of Rs. 12,1617/ -.
( 4 ) ON behalf of the Union of India, the defence taken is three-fold. The first defence is that the contract not being in the form under Section 175 (3), Government of India Act, 1935, it was not enforceable against the Union. The second defence is that the Union of India is not liable to refund this amount under this Rights, Property and Liabilities Order, 1947. The third defence, is that this Court has no jurisdiction to entertain and determine this suit.
( 5 ) NEITHER the plaintiff nor the defendant has called any oral evidence. There is an admitted brief of documents and correspondence mark-ed Exhibit A in these proceedings.
( 6 ) I shall take up the first defence on the from of contract under Section 175 (3), Government of India Act, 1935 now represented by Article 299 of the Constitution. Now in this case the contract is supposed to be contained in the invitation for tenders, the offer for such tenders and their acceptance. All that is by correspondence through Afferent officers of the defendant and the plaintiff. But none of such correspondence answers the requirements of Section 175 (3), Government of India Act. Under Clause 7 of the invitation for tenders it was provided "the purchasers will be required to sign an agreement" (D. D. No. 1 ). No agreement was, in fact signed. It, therefore, must be held, and I hold accordingly, that there was no contract which answered the statutory requirements of Section 175 (3), Government of India Act.
( 7 ) THE more important question that now remains to be answered is that even it there is no enforceable contract or agreement as against the Union of India because of this detect in form, can there he any claim for refund of money paid in pursuance thereof on the ground of failure of consideration as pleaded in paragraph 5 of the plaint. In order to be able to claim refund, Mr. T. P. Das, learned counsel for the plaintiff put forward three arguments. His first argument is that the plaintiff is entitled to claim refund under Section 70 Contract Act. His second argument is that the plaintiff is entitled to claim refun-1 under Section 65, Contract Act. His third argument is that he is entitled to claim refund under Section 72, Contract Act. These arguments require careful consideration.
( 8 ) AS Section 70, Contract Act was put forward fact as a ground for claiming refund, I shall deal with it first. Section 70, Contract Act, says that where a person "lawfully" does anything for another person or delivers anything to him not intending to d
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