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Issues:
Claim for price of goods under section 70 of the Indian Contract Act; Proper pleading requirements for a cause of action under section 70; Acceptance of goods and wrongful rejection; Interpretation of restoration under section 70; Calculation of compensation under section 70; Costs awarded by the High Court. Analysis: The respondent filed a suit claiming payment for goods supplied to the appellant, alleging wrongful rejection of the goods. The appellant denied the existence of an enforceable contract and raised a plea regarding the rejection of goods based on quality. The trial court found that the goods were not properly rejected but also noted inconsistencies in the appellant's actions regarding the goods. The trial court held that since the goods were accepted, there was no basis for restoration, and thus dismissed the suit. The Division Bench, however, held that the goods were accepted, leading to confusion in its judgment as it treated the claim as one for damages for wrongful rejection under the Sale of Goods Act, which was erroneous. The High Court allowed the claim under section 70 of the Indian Contract Act, awarding compensation to the respondent for goods accepted. The key issue in the case was the proper application of section 70 of the Indian Contract Act. The court emphasized that for a cause of action under this section, three essential ingredients must be pleaded: lawful delivery of goods, non-gratuitous intention, and benefit enjoyed by the recipient. The court noted that the respondent's pleadings lacked the necessary elements to constitute a claim under section 70, but due to the trial and appeal proceedings having progressed on this basis, the court refrained from non-suiting the respondent at that stage. Regarding the concept of restoration under section 70, the court clarified that as long as there is an intimation by the defendant for the plaintiff to take back the goods, the intention of restoration is demonstrated. In this case, since the goods were accepted by the appellant, the question of restoration did not arise. The court criticized the trial court for dismissing the suit based on the premise of restoration when acceptance had occurred, and the Division Bench for erroneously deciding the case on the grounds of damages for non-acceptance instead of the principles of section 70. In conclusion, the court upheld the High Court's decision to award compensation to the respondent under section 70 of the Indian Contract Act. The court specified the amount to be paid by the parties and maintained the costs awarded by the High Court. The appeal was ultimately dismissed, affirming the decree for compensation to the respondent.
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