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1952 Supreme(Nagpur) 140
HIGH COURT OF NAGPUR
Deo
SETH HAJARIMAL, HAMIRCHAND HAJARIMAL AND ANR – Appellant
Versus
GULABCHAND UDECHAND – Respondent
Civil Revision No. 809 of 1951
Decided on : 05-12-1952
G S Padhye, H M Thakkar, Advocates
In a 'bilticut' transaction, the price is payable at the buyer's place of business against the railway receipt, and the cause of action arises at the buyer's place of business where the renunciation of the contract is communicated.
Headnote:
JURISDICTION - SALE OF GOODS ACT, 1930 - SECTION 25(2) - BILTICUT TRANSACTION - PRICE PAYABLE AT BUYER'S PLACE OF BUSINESS AGAINST RAILWAY RECEIPT - CAUSE OF ACTION ARISES AT BUYER'S PLACE OF BUSINESS WHERE RENUNCIATION OF CONTRACT COMMUNICATED.
Fact of the Case:
Plaintiff and Defendant entered into a 'bilticut' agreement for the purchase of gram. The place of delivery of goods and payment of price was not specified in the agreement. Plaintiff filed a suit for damages for breach of contract at Waroda, where he carried on business, alleging that Defendant renounced the contract by letter. Defendant contended that the suit was not maintainable at Waroda as the cause of action arose at Kareli, where the agreement was entered into.
Finding of the Court:
The court held that the price was payable at Waroda against the railway receipt, as per the usage of 'bilticut' transactions. The cause of action arose at Waroda where the renunciation of the contract was communicated to the Plaintiff. The court relied on Section 25(2) of the Sale of Goods Act, 1930, which provides that where goods are shipped and the bill of lading is deliverable to the order of the seller or his agent, the seller is 'prima facie' deemed to reserve the right of disposal.
Issues: 1. Whether the suit was maintainable at Waroda, where the Plaintiff carried on business, or at Kareli, where the agreement was entered into? 2. Whether the price was payable at Waroda or Kareli?
Ratio Decidendi: 1. The cause of action arises at any of the places (a) where the contract was made, (b) where the contract was to be performed, or performance thereof was to be completed, and (c) where in performance of the contract any money was expressly or impliedly payable. 2. In a 'bilticut' transaction, the price is payable against the railway receipt. This can be gathered from the evidence of witnesses and the usage of 'bilticut' transactions. 3. The place of delivery of goods and payment of price was not specified in the agreement. Therefore, the price would be impliedly payable at Waroda, where the Plaintiff carried on business.
Final Decision: The application for revision was dismissed with costs.
Deo, J—This is Defendants' application for revision of the order of the Lower Court holding that it has jurisdiction to try the suit.
2. The facts are: On 27-4-1950 the Plaintiff's agent entered into an agreement with the Defendant firm at Kareli to purchase 401 bags of gram at Rs. 28/7/- per bag 'bilticut'. The goods were to be booked from Kareli or Narsimhapur. Ex. D l is the entry of the agreement signed by the agent in the book of the Defendants. The other terms stated in the document are not material for the purpose of this revision. It however did not state the place or time of the payment of the price or the place of delivery of the goods.
3. The Plaintiff has brought this suit for damages for breach of the agreement at Waroda where he is carrying on business. According to him the Defendant sent a letter dated 13-5-1050 to him informing him that ''the Indent of 400 bags is cancelled''. Defendant 2 who is also the owner of the Defendant, firm is impleaded on the ground that he sent another letter (Ex. P-l) of the same date.
Plantiff has claimed damages on the ground that by this renunciation of the contract the Defendants have committed a breach and are liable for damages. The Plaintiff pleaded that the price was payable at Waroda against delivery of railway receipt by the banker of the Defendants.
4. According to the Defendants, the agent had agreed to pay Rs. 4000- as earnest money and to pay the balance at the time of loading the goods. It was further pleaded that as the agent had not come with ready cash he asked the Defendants to draw a 'hundi' for that amount, assuring them that the Plaintiff would make the payment to the holder in due course.
The 'hundi', however, was not honoured and was returned by their banker on 14-5-1950. It was pleaded that the Plaintiff has committed a breach of the contract by not honouring the 'hundi' and consequently the contract was no longer in existence. Although the date of this communication is not stated, it appears that it was sent on or about 13-5-1950. That letter is not on record.
5. The liability of Defendant 2 on the strength of Ex. P-l was also denied.
6. The lower Court held that the agreement pleaded by the Defendants for making the deposit was not proved. The agent had denied this agreement from the witness-box. This important condition would have appeared in Ex. D-1 if it was really agreed upon. After the refusal of the Plaintiff to honour their 'hundi', Defendant 2 was at Waroda and the talk he had with the Plaintiff was confirmed by him by the letter Ex. P-l in which he did not complain that the refusal to honour the 'hundi' was in breach of the agreement. On the contrary, he acquiesced in it asked the Plaintiff to return the 'hundi'' and assured him that after loading the goods the 'hundi' and 'bilti' would be sent.
7. The agent has deposed that there was an agreement that the 'hundi' and 'bilti' were to be sent to a bank at Waroda. This is not corroborated by P.W. 3 Inderchand who was admittedly present at the time of the agreement and who had introduced the agent to the Defendants. It therefore follows that there was no express agreement about the time and place of payment of the price.
8. It is common ground that this was a 'bilticut' transaction. The case has therefore to be decided on the incidents or the 'bilticut' transaction and according to the provisions of the Sale of Goods Act.
9. It is not seriously disputed that the suit can be instituted in a Court within the local limits of whose jurisdiction the cause of action wholly or in part arises. The expression ''cause of action'' can be compendiously defined to mean every fact which it would be necessary for the Plaintiff to prove, if traversed, in order to support his right to the judgment of the Court. Thus, a cause of action comprises every fact which is necessary to be proved by the Plaintiff.
In order to support his claim Plaintiff has to plead both the right and its infringement. The place where the cause o
