The court held that the contract was not affected by the Vegetable Oils and Oilcakes (Forward Contracts Prohibition) Order, 1944, and was enforceable by the plaintiff.

C. A. VAIDIALINGAM, J. :

This is an appeal by the plaintiff against the dismissal by the learned Subordinate Judge of Kozhikode, of his suit O. S. 38 of 1951 on the ground that the suit contract is void and not legally enforceable, in view of the provisions of the Vegetable Oils and Oilcakes (Forward Contracts Prohibition) Order, 1944.

2. The plaintiff, who is a merchant carrying on business at Kozhikode, filed the suit against the defendant, a firm of merchants carrying on business in Oilcakes at Madras, for recovery of a sum of Rs. 9,000/- as damages for breach of contract and for certain other reliefs.

3. The plaintiffs case was that on 5th December, 1950, the defendant entered into a contract with the plaintiff through a broker for the supply of 200 tons of groundnut oilcake at 190/-per ton of 2240 lbs. F. O. R. The delivery was to be in January and February 1951 at the rate of 100 tons each month and that the plaintiff is to supply necessary gunnies, 15 days before the despatch. The plaintiff further alleged that the contract was accepted by both parties and parties took further steps in fulfilment of the contract, but the defendant, without any justification whatsoever purported to cancel the contract by his unilateral declaration and did not supply the goods and as such, committed breach of contract. According to the plaintiff, the defendant so committed a breach of contract, in view of the fact that prices had gone up considerably after the date of the contract. The plaintiff, on these allegations, claimed damages at Rs. 45/- per ton, though the market rate on the date of the breach was much higher.

4. The suit was resisted by the defendant on several grounds. Substantially, the defence was that the broker, who brought about the contract, had informed the defendant that the plaintiff was not agreeable to the terms of the contract and as such, the contract had been given the go-by even by the plaintiff himself and in view of this, the defendant had cancelled the contract by writing to the plaintiff as early as 18-12-1950. Alternatively, the defendant pleaded that in any event, the plaintiff did not perform his part of contract namely, of supplying the gunny bags within time and as such, the plaintiff had committed a breach of contract.

There was another short ground of defence mentioned in paragraph 21 of the written statement to the effect that the suit contract being a "Forward Contract in groundnut oilcake" is invalid and unenforceable. No further details as to this contention were given in the written statement. The defendant also in the end, contended that the damages claimed by the plaintiff were excessive. Here again, it must be stated, the defendant did not state as to what according to him, was the market rate during the relevant period.

5. The learned Subordinate Judge considered the various contentions of both the parties and came to the conclusion that the plaintiff had not revoked the suit contract and he further held that it was the defendant who committed a breach of contract.

6. On the question of damages, the learned Judge held that in the month of January 1951, the difference in price ranged between Rs. 43 to 44 and in the month of February 1951, the price ranged at about Rs. 42 per ton over and above the contract rates. In this view, the learned Judge reduced the claim of the plaintiff which was at Rs. 45/- per ton and held that the plaintiff would be entitled only to a sum of Rs. 8,500/-as damages. In this connection, it may also be stated that the learned Judge has observed that there is no dependable counter-evidence regarding the price given by the plaintiff, on the side of the defendant.

7. On the question of the illegality or void nature of the contract, as contended by the defendant, the learned Judge, after a reference to the various statutes having a bearing on this matter, came to the conclusion that the contract was hit by the provisions of the Vegetable Oils and Oilcakes (Forward Contract