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The defence to the suit as disclosed in the, written statement is that the respondent has since discovered that the said Bought and Sold Notes and contracts were and are invalid and are void for the reasons stated in the written statement.

The ground on which the Bought and Sold Notes and contracts are stated to be invalid and void is that under the west bengal Act V of 1950 (West Bengal Jute Goods Act) which was promulgated on 15th March, 1950, and the notification issued thereunder. the making of contracts for sale and purchase of jute goods on a forward basis by or with any person not being a person who habitually dealt in the sale or purchase of jute goods involving the actual delivery of possession thereof was prohibited. As the respondent had since discovered that the contracts came within the mischief of the said Act and the notification the contracts were and are void. The respondent admitted that he paid a sum of Rs. 50,175/- regarding the three contracts in respect of goods deliverable in April, 1952 but stated that the same was paid before the contracts were discovered to be void. The other allegations made in the plaint were generally denied. The facts and/ or validity of the alleged tender and/or the alleged resale and/or the alleged notice were denied. With reference to allegation in paragraph 14 of the plaint that the appellant delivered the delivery orders and the respondent paid for and took delivery of the delivery orders it was averred in the written statement that the delivery orders delivered by the appellant were paid for and taken delivery of by the respondent before the relevant contract was discovered to be void. The claim in the plaint and the respondent's liability was generally denied. According to the pleadings of the parties it is seen that the plaint allegations are that the contracts were entered into in the standard I.J.M.A. forms which were annexed to the plaint. It was further alleged 'that regarding the delivery of goods in April, 1952, in respect of the three contracts the respondent entered into a settlement contract and paid the appellant a sum of Rs. 57,175 as per the contract. Regarding goods deliverable in May, 1952 under the three contracts though the bills were submitted the respondent failed and neglected to pay the same. Regarding the goods deliverable under the three contracts in June, 1952, it is alleged that the appellant duly and in terms of the contract tendered the delivery orders in respect of the said goods for June delivery but the respondent wrongfully failed and neglected to accept and to pay for the same. Regarding the hessian contracts for the goods deliverable in April, 1952, it is alleged that the appellant duly delivered delivery orders and the respondent paid for and took delivery of the same but failed and neglected to pay for and take delivery of the goods deliverable in May and June 1952. In respect of the hessian deliverable in June, 1952, it is alleged in the plaint that the appellant tendered the pucca delivery orders but the respondent failed' and neglected to accept and pay for the said goods or delivery orders. It may be noted that the specific allegation in the plaint is that regarding April delivery of Twills under the three contracts the claim was satisfied by the respondents. Regarding the three contracts for goods deliverable in May it is alleged in the plaint that the appellant submitted the bills but respondent did not honour it. In Paragraph 9 of the plaint it is stated regarding the goods deliverable in June, 1952 that "The plaintiff duly and in terms of the contract tendered the Delivery Orders in respect of the said goods in respect of June Delivery but the plaintiff wrongfully failed and neglected to accept and/or to pay for the same."The allegation specifically is that delivery orders were tendered interms of the contract. So also in the case of hessian contracts it isalleged in Paragraph 14 of the plaint that the appellant duly delivered the delivery orders and the respondent paid for and took delivery of the same. Regarding the goods deliverable in June 1952 also in Paragraph 18 of the plaint it is alleged that the appellant tendered pucca delivery orders in respect of goods deliverable in June, 1952 but the respondent failed and neglected to pay and accept for the said goods. The reply to the specific allegations referred to in the various paragraphs of the plaint is that the delivery orders in the case of goods deliverable in April were paid for and taken delivery of before, the relevant contract was discovered to be void. The allegation by the defence according to the written statement is that the res- pondent discovered the Bought and Sold notes and contracts, to be invalid and void under the West Bengal Act V of 1950 in that it related to a forward contract prohibited under law. The' allegations in the plaint that the delivery orders were issued according to the contract were nowhere denied. The only defence was that the delivery orders were received and paid for in the case of April contracts before realising that the contracts were void. On the' pleadings therefore, the question as to whether the delivery order was according to the contract was not in dispute. Neither were the allegations that the contracts were in the standard I.J.M.A. Contract Forms were denied.

Four years after the original plaint was filed the appellant sought an amendment of the plaint for introduction of paragraphs 19-A and this amendment the appellant while reiterating that the tendersmade by the appellant of the Mills Pucca Delivery Orders as mentioned in paragraphs 9, 14 and 18 of the plaint were duly made in terms of the contracts between the parties, further pleaded that the delivery orders tendered in respect of the contract mentioned in the plaint were and are proper tenders by virtue of trade customs and usage of the Jute Trade in Calcutta. The particulars of the customs and usage were set out in four sub-paragraphs of Paragraph 19A of the plaint. In Paragraph 19B the appellant alleged that the respondent was at all material times fully aware of the aforesaid Trade customs and usages and dealt with the appellant on the basis thereof. An additional written statement was filed by the respondent on 9th December, 1957, in which he denied that the alleged tenders or any of them or the alleged delivery orders or any of them were in terms of the contracts between the parties. It was contended that the Mills' Pucca Delivery Orders were not delivery orders at all and in any event the appellant bad no title to any of them. It was also contended that the delivery orders related to goods deliverable under contract between third parties mentioned in the delivery orders and in any event the goods mentioned in the delivery orders are not goods of the description mentioned in the contracts-between the parties and that when the respondent called for the tender of inspection orders in terms of the contracts. the appellant wrongfully and in breach of contract failed and neglected to tender any inspection order. The custom pleaded was also denied. It was also contended that the delivery orders were not transferable by endorsement and that there were no appropriations of the goods relating to any contract or delivery order. The respondent also denied that the customs or usage ever existed and in any event the customs or usage is inconsistent with the terms of the written contracts and that it was not right to allege that the respondent was aware of! any such customs and dealt with the appellant on that basis.

(2) [1961] (3) S.C.R. 267 at 270.

3-1114 SCI/77 These objections appear to be insurmountable and the courts below took the view that the appellant cannot succeed as the delivery order is not unconditional and therefore not in accordance with the contract. On a careful consideration of the, records and hearing the arguments of the counsel it appears, that one important aspect was not duly considered by the Courts below. The plea of the appellant is that the delivery order is in accordance with the contract and that the respondent knew that the delivery order was in accordance with the contract and that he wanted to avoid the contract as the prices had fallen without any justification. The contents of the plaint have been set out at length at the beginning of the judgment. It may be noted that the appellant and the respondent entered into several contracts. The first 3 contracts were entered into on 22nd November, 1st December and 10th December, 1951. Under each of the contracts goods were to be delivered in April, May and June. The rates specified are Rs. 206/. per 100 bags according to the first contract, Rs. 210/4/- per 100 bags and Rs. 216/- per 100 bags respectively. At the commencement of the first period of delivery in April, 1952, it was found that the rate had fallen to Rs. 1551- per 100 bags. The margin in the three deliveries due in April under the 3 contracts resulted in a loss of about Rs. 50,175 to the respondent. That this contract was under Indian Jute Mills' Association was not disputed and accepting its full implications the respondent paid the amount under settlement contracts. Regarding the delivery due in the month of May under the 3 contracts there was a Sold and Bought note exchanged between the parties whereby the respondent agreed to sell to the appellant and the appellant agreed to buy from the respondent 90,000 bags of B Twills at Rs. 136/- per 1 00 bags. It may be noted that the price had come down further from Rs. 1551- in April to Rs. 136/- in May. There was no protest and for the month of May also the goods were delivered by the appellant to the respondent and back by the respondent to the appellant. Due to the fall in prices the appellant claimed Rs. 67,275/- and a decree had been passed so far as that claim was concerned by the trial Court which has become final. While the contract was accepted and a settlement contract was affected on the basis of delivery of goods by the appellant as regards April and May the dispute is as regards the goods deliverable in June under the 3 contracts. Regarding all the 3 contracts the first 2 deliveries due in April and May have not been disputed. For the delivery of goods under the 3 contracts in June, 1952. it is alleged in the plaint in Paragraph 9 as follows "The plaintiff further states that in respect of the Contracts mentioned in paragraph 3 above the defendant failed and neglected to pay for and/or to take delivery of thegoods which were deliverable under the aforesaid contractsin June 1952. The plaintiff duly and in terms of the contract tendered the Delivery Orders in respect of the said goods in respect of June Delivery but the plaintiff wrongfully failed and neglected to accept and/or to pay for the same."

This aspect of the case was not brought to the notice of the trial Judge and the appellate court. The learned trial Judge held that the appellant had not raised any plea of estoppel and therefore cannot rely on the failure of the respondent to point out the defects in the delivery observed as follows :

"The plaintiff's contention was that under the contract the tender of delivery orders, namely, Mill Pucca Delivery Orders, was a valid tender according to the contract and in, any event was proper tender by virtue of trade customs and understood andaccepted Mills pucca delivery orders as delivery ordersand that the defendant had accepted mill's pucca delivery orders and paid therefore with respect to certain deliveries under the contracts in question. It was also contended on behalf of the plaintiff that in some of the correspondence the defendant alleged that as the plaintiff failed to tender mill's pucca delivery orders, the contract was cancelled and, therefore, there was in the correspondence never any contention on behalf of the defendant that mill's pucca delivery orders were not proper tender. No case of estoppel was pleaded and I am, therefore of opinion that the plaintiff cannot raise any such plea of estoppel."