A person who obtains money under duress or under a mistake of law cannot escape liability by transferring the money to someone else.

S. RAMACHANDRA IYER, C.J. :- This is an appeal under Cl. 15 Letters Patent from the judgment of Anantanarayanan J. in A. S. No. 606 of 1956 by which the learned Judge affirmed the decree passed by the Additional District Judge, Nagarcoil directing the appellant herein in a suit filed by the respondent to refund the excess collections of transport charges made by him. The respondent had entered into a contract with the Cochin Government, a contract under which time was the essence, to deliver a large quantity of salt at Allepey and Cochin. The respondent had brought up the salt to be delivered at the place called Manakudi. Transport from that place to the two places of delivery had to be made by means of sailing vessels popularly known as country crafts through waterways connecting the places. Wartime needs had brought about scarcity of shipping space. Further, there was also need for regulating the charges levied by the ship and country craft owners. With a view to facilitate the transport of cargo after meeting the needs of the Government, and the Military Departments and also with a view to prevent the craft owners from exploiting the situation occasioned by the great demand for shipping space and demanding unconscionable amounts by way of transport charges, the Government of India placed certain restrictions on the shippers and the ship owners in the matter of transport of goods. They had power to do this under Rule 89 (2) (e) read with sub-clause 5 of the Defence of India Rules. Sub-Clause 5 enacted that the provisions of sub-rule 2 to rule 89 would apply in relation to water transport. Under sub-rule 2(e), "the Government may by general or special order prescribe conditions subject to which and the rates at which any vehicle may be hired for the purpose of transport". Accordingly on 30th August 1944 the Government issued a notification fixing the rates of transport charges for country crafts and other sailing vessels and also introducing a system by which route agents were nominated by the Government who were given sole authority to secure for the intending shippers shipping space. These route agents collected transport charges for the cargo offered for transport by the shippers. Rule 1 of the notification states that no person shall hire any country craft for the purpose of transporting goods or persons by any of the routes specified except through the agency of the route agent specified against that route. The rule further nominated the appellant as the route agent between Cochin and Tuticorin including all intermediate ports and vice versa. Rule 3 fixes the rates of transport charges for the country crafts in regard to transport of salt from Mankudi to Cochin at Rs. 10 per ton and for other ports between Malabar and Tuticorin at Rs. 9 per ton. These rates can be altered only by the Government.

2. Under the route system that introduced the route agent nominated by the Government alone could provide space for all cargo within the route entrusted to him, and he had authority to charge freight at the rates fixed by the Government and after deducting commission payable to him he is to pay the balance to the ship owner. In other words the route agent would receive freight charges from the shippers in the first instance in accordance with the rates fixed by the notification and pay the ship owner and the brokers their respective shares as freight and brokerage after retaining his own commission. This notification was in force till 1st September 1945.

3. During the period between 27th December 1944 and 16th January 1945, the respondents transported salt intended for delivery to Cochin Government through country crafts engaged by the appellant as the route agent. The country craft owners and other ship owners were, however, not satisfied with the freight charges fixed under the Government notification as they considered that the rates fixed under the notification were inadequate. On representations being made by them, th