The main legal point established in the judgment is the application of Section 70 of the Indian Contract Act 1872 to establish liability for non-gratuitous acts and the prevention of unjust enrichment.

Pradeep Nandrajog, J.

1. Respondent No.1 Hansa Vision Ltd. filed a suit seeking decree in sum of Rs.43,85,605/-. It pleaded being engaged in the business of marketing T.V. serials and advertising on television. It pleaded that Dabur India Ltd., defendant No.1, had appointed Adbur Pvt. Ltd., defendant No.2, as its agent to advertise its products and in turn Adbur Pvt. Ltd. had appointed M/s A.V. Communications, defendant No.3, as the sub-agent, which defendant, in said capacity i.e. of a sub-agent, approached M/s Hansa Vision Ltd. to advertise products of the first defendant during telecast of various programmes by various television networks and for which defendant No.3 issued release orders on April 06, 1995 and April 26, 1995 as also a release order dated nil, pursuant whereto, Hansa Vision obtained slots in various programmes aired by various T.V. networks in which advertisements of defendant No.1 were aired and for which it was pleaded that as per the agreement a sum of Rs.47,13,897/-became payable to it. Alleging that defendants acknowledged liability to pay Rs.23,39,177/- but defendant Nos. 1 and 2 thereafter informed having paid Rs.32,34,250/-to defendant No.3, and washed off their hands; alleging further that Rs.23,39,177/-was admittedly payable as of July 23, 1999 and claiming pre-suit interest @ 18% per annum, suit was filed praying for a decree in sum of Rs.43,85,650/-.

2. In the written statement jointly filed by Dabur India Ltd. and Adbur Pvt. Ltd., it was pleaded that the plaintiff executed the works as per a contract with defendant No.3 with respect to the publicity/advertising job assigned by defendant No.2 to defendant No.3 on principal to principal basis; and that the relationship between the plaintiff and defendant No.3 was also of principal to principal. It was denied that defendant No.3 acted as the sub-agent of defendant No.1. As regards defendant No.2, requiring defendant No.3 to execute the publicity work on behalf of defendant No.1, it was pleaded that the said pertained to an internal working between defendant No.1 and defendant No.2 and had no concern with the claim of the plaintiff. It pleaded having paid full money to defendant No.3.

3. In a nutshell, the pleading was that for advertising the products of defendant No.1, defendant No.2 had entered into a principal to principal contract with defendant No.3 and defendant No.3 had likewise entered into a principal to principal contract with the plaintiff. As per defendants No.1 and 2, they had made the entire payment to defendant No.3 and it was for the plaintiff to realize the money, if any unpaid, from defendant No.3.

4. Defendant No.3 remained ex-parte.

5. On the pleadings of the parties, the following issues were settled as per order dated January 27, 2004:-

“ 1. Whether the suit is within time? OPP

2. Whether the plaint has been signed, verified and filed by a duly authorized person? OPP

3. Whether the written statement filed on behalf of defendants No.1 and 2 has been signed, verified and filed by a duly authorized person? OPD

4. Whether the defendants No.1 and 2 have no privity of contract with the plaintiff as averred in the written statement? OPD

5. Whether there is no cause of action against the defendant Nos. 1 and 2? OPD

6. Whether the plaintiff is entitled to recover the suit amount from defendants No. 1 and 2 on the grounds mentioned in the plaint? OPP

7. Whether the plaintiff is entitled to interest as prayed? If so, on what amount and for which period? OPP

8. Relief.”

6. The plaintiff examined Subhash Gulati, its Senior Finance Manager and R.Jaganathan its Senior Accounts Officer as PW-1 and PW-2 respectively and apart from reiterating the case pleaded in the plaint the two proved the bills Ex.PW-2/1 to Ex.PW-2/23 raised by the plaintiff on defendant No.3 on various dates between April 20, 1995 and October 31, 1995 as also the telecast certificates Ex.PW-2/24 to Ex.PW-2/37 evidencing advertisements pertaining to def