1949 Supreme(Cal) 141

HIGH COURT OF CALCUTTA
Sinha
RAM NAGINA SINGH - Appellant
Versus
GOVERNOR-GENERAL IN COUNCIL - Respondent
Original Civil Suit 1572  Of  1946
Decided On : SEPTEMBER 2, 1949

Section 65, Contract Act, applies to cases where an agreement is void by reason of non-compliance with express statutory provisions.

Headnote:

CONTRACT - Void - Agreement between plaintiff and defendant - Not enforceable by law - Discovered to be void after advantage received - Plaintiff entitled to compensation under Section 65, Contract Act - Section 65 applies to cases where an agreement is void by reason of non-compliance with express statutory provisions - Section 70, Contract Act also applies to such cases.

Fact of the Case:

Plaintiff, a manufacturer of bricks, supplied bricks to the defendant, Chief Engineer, Eastern Command, under permits issued by the Government of Bengal. The permits mentioned the rates ex-field at which the bricks could be purchased. The plaintiff delivered the bricks to the Eastern Construction Company (Company) at Juggernath Ghat and Dahi Ghat by boat from where the bricks were transported by lorry at the cost of the Company. The Company was engaged in doing military work and the bricks were necessary for the purpose of carrying out and completion of the said work. The plaintiff made out three bills addressed to the Company in respect of bricks supplied under these permits and charged the rates mentioned in the permits. The Company insisted on paying lower rates than those mentioned in the permits. The bills were not paid. The plaintiff wrote to the Chief Engineer, Eastern Command, who wrote to the Company asking it to draw from the plaintiff 6 lakhs of bricks on permits and an additional quantity of 2,70,000 bricks on behalf of the Chief Engineer, Eastern Command for urgent military work. The plaintiff made out three bills on the Chief Engineer, Eastern Command for Rs. 11. 902-10-0, Rs. 4,972-15-9 and Rs. 1. 135-9-0 respectively. These bills were submitted with the relevant challans and receipt of these bills was acknowledged by S. D. O. I. The plaintiff received a letter written on behalf of the Garrison Engineer, 157 I. W. S. , as follows: “no bricks have been drawn by this unit from you for work at Alipore. Messrs. Eastern Construction Company in their letter No. C. D. /113/ 10978, dated 25-8-1944 have said that not only have you been paid for all the bricks drawn but that you have been over paid to the extent of Rs. 2,762-2-0 which includes all boat hire, toll-charges and loading charge. The bill in question is returned herewith.” Thereafter there was correspondence between the plaintiff and the Chief Engineer Eastern Command. The plaintiff contended that the bricks had been supplied on the assurance of the Garrison Engineer that the payment of such supply would be made by the office of the Garrison Engineer 157. It appears that the Company was written to on behalf of the Garrison Engineer that the claims of the plaintiff should be satisfied early. On 4-10-1945, the Company wrote to the Chief Engineer, Eastern Command, that the plaintiff had been overpaid and the claim of the plaintiff was unfounded. On 24-10-1945, a letter was written on behalf of the Chief Engineer, Eastern Command to the plaintiff that the question of payment of the plaintiff's. bills and had to be decided between the plaintiff and the Company. There was further correspondence between the plaintiff and the Chief Engineer in course of which the plaintiff insisted on payment by the Govt. On 22-2-1946 a letter was written to the plaintiff by the Engineer in Chief which is as follows:“i acknowledge the receipt of your letter dated 14-2-1946, regarding the question of payment for bricks collected toy M/s. Eastern, Construction Company on behalf of the Chief Engineer,-Eastern Command. The matter is receiving attention by the Chief Engineer, Eastern Command to whom further communication should be addressed.” On 26-3-1946 notice was given under Section 80, Civil P. C. addressed to the Secretary, Central Govt. Defence Dept, New Delhi demanding payment of Rs. 18,011-3-3 on account of the price of bricks supplied and alternatively as compensation. On 27-8-1946, the present suit was filed.

Finding of the Court:

1. The agreement under which the bricks were supplied is void and not binding on the defendant. 2. The defendant did not guarantee payment of any sum to the plaintiff as alleged in para 9 of the plaint. 3. The plaintiff is entitled to recover compensation under Section 65, Contract Act. 4. The plaintiff is also entitled to recover compensation under Section 70, Contract Act.

Issues: 1. Was there any contract between the plaintiff and, the defendant as alleged in the plaint?. 2. Did the plaintiff supply any goods to the defendant? (a) If so, was it pursuant to any contract? (b) If they supplied pursuant to any contract is the contract binding on the defendant, having regard to Section 175, Govt. of India Act? 3. Did the defendant, guarantee-payment of any sum to the plaintiff as. alleged in para 9 of the plaint? (a) Had Major Benge authority to guarantee payment to the plaintiff? (b) Is the defendant, bound by the alleged letter of guarantee dated 15-1-44, having regard to Section 178 Govt. of India Act? 4. Is the defendant, bound to make compensation to the plaintiff as alleged in para 13 of the plaint? 5. To what relief, if any, is the plaintiff entitled?

Ratio Decidendi: 1. Section 175 (3), Govt. of India Act 1935 provides that all contracts made in the exercise of the executive authority of the Federation or of a province shall be expressed to be made by the Governor General, or by the Governor of the Province, as the case may be, and all such contracts and all assurances of property made in the exercise of that authority shall be executed on behalf of the Governor General or Governor by such persons and in such manner as he may direct or otherwise. 2. Section 65, Contract Act, applies to cases where an agreement is void by reason of non-compliance with express statutory provisions. 3. Section 70, Contract Act also applies to such cases.

Final Decision: Decree for the plaintiff for Rs. 18,011-3-3 with interest at 6% per annum from the date of suit till realization.