The main legal point established in the judgment is that under Section 70 of the Indian Contract Act, a person enjoying the benefit of a non-gratuitous act is bound to make compensation to the person who lawfully does anything for them, even in the absence of a written agreement as required by Article 299(1) of the Constitution of India.

Ajay Mohan Goel, J.

By way of the present appeal, the State has challenged the judgment and decree passed by the Court of learned Additional District Judge, Shimla in Civil Appeal No. 3-R/13 of 2004/01 dated 25.02.2006 vide which, learned Appellate Court has allowed the appeal and set aside the judgment and decree passed by learned trial Court and decreed the suit of the plaintiff for recovery of Rs.52,250/- alongwith interest pendente lite and future @ 6% till realization.

2. This appeal was admitted on the following substantial question of law on 21.08.2008:

“Whether the provision of Section 70 of the Indian Contract Act as discussed by the Ld. Lower Appellate Court is attracted in the facts and circumstances of this case?”

3. Brief facts necessary for the purpose of adjudication of the present case are that the plaintiff filed a suit for recovery of Rs.67,141.25/- on the grounds that the plaintiff was a registered potato grower with the Agriculture Department of Himachal Pradesh and used to sell his produce in the market and he also used to supply the same to the Department on demand. According to him, on the instructions/orders placed by the representatives of District Agricultural Officer, Kinnaur confirmed on telephone by Shri R.S. Verma, District Agriculture Officer, Kinnaur, plaintiff supplied 55 bags of certified seed potato in the month of December, 1998 @ of Rs.950/- per bag to defendant No. 3 at Reckong Peo, District Kinnaur through challan dated 17.12.1998 from Tikkar to Reckong Peo by Truck bearing registration No. HP-51-1535, which was duly received by defendant No. 3. His further case was that the said consignment of 55 bags after being duly received was supplied by the Department to the Growers of Kinnaur District under some Government subsidy Scheme and the value of the said consignment @Rs.950 per bag for 55 bags came to Rs.52,250/-. Despite requests and reminders, the defendant No. 3 did not care to pay the said amount to the plaintiff. It was averred in the plaint that several other crowers had also sent potatoes on demand to defendant No. 3 and out of these growers, about 8 growers had been left high and dry to whom payment had not been made. In these circumstances, the suit was filed by the plaintiff for recovery of the said amount alongwith interest.

4. In the written statement, the defendants denied the case of the plaintiff. As per the defendants, defendant No. 3 never gave any supply order to the plaintiff for the supply of seed potatoes. The plaintiff prepared the challan alongwith bill in the name of defendant No. 3 from Tikkar and unloaded 55 bags of seed potatoes at Bhawanagar of Nichar Block at his own on 17.12.1998, though no supply order had been placed by defendant No. 3. Plaintiff also managed receipt for 55 bags from some grass root level officers of the same station and some other farmers of Shimla District followed the same course which was adopted by the plaintiff and unloaded potatoes at Nichar Block. Defendant No. 3 issued telegrams to those growers, who unloaded the seed potato without any supply order, to lift back their seed potato, but of no avail. This resulted in pilling up of huge quantity of 1006 bags of seed potato in Nichar Block. Out of this, 532 bags of seed potato could be sold by making all out efforts by the defendants and remaining 470 bags got rotten. It was further the case of the defendants that it had become very difficult to identify as to whose consignment was sold and whose had become rotten. In these circumstances, in order to know the factual position, an inquiry was ordered by defendant No. 3 and as per the averments made in the written statement, the decision regarding release of payment of the seed potato could be made after finalization of the said enquiry which was in progress.

5. On the basis of the pleadings of the parties, learned trial Court framed the following issues:

Issue No. 1: Whether the plaintiff is entitled to a decree for the suit amount?