1985 (9) TMI 355 - HC - Indian Laws

Summary

Issues Involved:
1. Whether the contract was for the sale of specific goods in a deliverable state.
2. Whether the property in the goods passed to the plaintiff upon acceptance of the tender.
3. Whether the cancellation of the sale order by the defendants was lawful.
4. Whether the plaintiff was entitled to a declaration of title and permanent injunction.

Issue-wise Detailed Analysis:

1. Whether the contract was for the sale of specific goods in a deliverable state:
The plaintiff argued that the contract was for the sale of specific goods in a deliverable state, and thus the property in the goods passed to him upon acceptance of the tender. The defendants contended that the contract was merely an agreement to sell and not for specific goods in a deliverable state. The High Court concluded that the goods in question were specific goods in a deliverable state as the defendant had nothing to do before delivery was taken by the plaintiff. The measurement in accordance with the sectional weight chart was for the satisfaction of the plaintiff, and the goods were identified and agreed upon at the time of the sale.

2. Whether the property in the goods passed to the plaintiff upon acceptance of the tender:
The plaintiff claimed that the property in the goods passed to him when the contract was made, as it was an unconditional contract for the sale of specific goods in a deliverable state. The defendants argued that the property did not pass to the plaintiff as the contract was conditional upon the fulfillment of certain terms. The High Court held that under Section 20 of the Sale of Goods Act, where there is an unconditional contract for the sale of specific goods in a deliverable state, the property in the goods passes to the buyer when the contract is made. The High Court accepted the plaintiff's contention that the property in the goods passed to him upon acceptance of the tender.

3. Whether the cancellation of the sale order by the defendants was lawful:
The plaintiff contended that the cancellation of the sale order by the defendants was illegal, invalid, and without jurisdiction as the property in the goods had already passed to him. The defendants argued that they had the right to cancel the contract as the plaintiff failed to fulfill his obligations within the stipulated time. The High Court found that since the property in the goods had already passed to the plaintiff, the defendants were not entitled to cancel the contract and resell the balance of the articles. The cancellation of the sale order by the defendants was thus held to be unlawful.

4. Whether the plaintiff was entitled to a declaration of title and permanent injunction:
The plaintiff sought a declaration of his title to the remaining 250 Metric Tonnes of M. S. Rounds of 28 dia and a permanent injunction restraining the defendants from removing and reselling the goods. The High Court concluded that the plaintiff had valid and legal title to the goods in dispute and was entitled to the declaration of title and permanent injunction. The decision of the Trial Court, which granted the plaintiff the declaration of title and permanent injunction, was restored by the High Court.

Conclusion:
The High Court allowed the appeal, set aside the judgment and decree of the learned Additional District Judge, and restored the decision of the learned Subordinate Judge. The plaintiff was declared to have valid and legal title to the goods in dispute, and the defendants were restrained from removing and reselling the same. The appeal was allowed without any order as to costs.