1951 (5) TMI 14 - HC - Indian Laws

Summary

Issues Involved:
1. Whether the Plaintiffs bought cotton in November 1943 through the defendants' firm and thereby sustained a loss of Rs. 1,136/4/-.
2. Whether the price of cotton had fallen below the amount due to the defendants' firm from the Plaintiffs' firm, justifying the sale of 110 bales of cotton by the defendants.
3. In case issue No. 2 is decided against the defendants, what amount are the Plaintiffs entitled to on account of the profit from the transaction of 110 bales of cotton.

Issue-wise Detailed Analysis:

1. Whether the Plaintiffs bought cotton in November 1943 through the defendants' firm and thereby sustained a loss of Rs. 1,136/4/-:
The Plaintiffs contested the correctness of the account, particularly the debit entry of Rs. 1,136/14/- for the loss alleged to have been suffered in November cotton transactions. The Plaintiffs' books did not reflect this entry. The court found that the evidence presented by the defendants, including statements from witnesses and account books, did not convincingly prove that the Plaintiffs had entered into the November cotton transactions. The court concluded that the defendants failed to prove the sum of Rs. 1,136/4/- was due from the Plaintiffs.

2. Whether the price of cotton had fallen below the amount due to the defendants' firm from the Plaintiffs' firm, justifying the sale of 110 bales of cotton by the defendants:
The court examined the account as of 25-11-1944 and found that even without the disputed debit entry, the Plaintiffs had a credit balance. The court noted that the defendants did not have the authority to sell the cotton without the Plaintiffs' consent, especially since there was still a sum due to the Plaintiffs. The court also highlighted that a commission agent's lien is restricted to goods related to specific transactions and cannot extend to other goods unconnected with the transaction. Therefore, the defendants had no justification for selling the 110 bales of cotton.

3. In case issue No. 2 is decided against the defendants, what amount are the Plaintiffs entitled to on account of the profit from the transaction of 110 bales of cotton:
The court scrutinized the alleged sale of the 110 bales and found discrepancies in the defendants' evidence, including the absence of immediate entries in account books, lack of advance payment, and conflicting statements from witnesses. The court concluded that the sale was not genuine. The Plaintiffs claimed damages based on the rate of cotton on the date of the suit, but the court clarified that damages should be assessed based on the rate when the breach occurred or when the delivery was refused. Since the Plaintiffs did not provide evidence of the cotton rates on the relevant date, the court could not grant a decree for damages. However, the court awarded the Plaintiffs Rs. 1,042/5/6 for the amount wrongly debited, with interest at the contractual rate.

Conclusion:
The appeal was accepted, and a decree for Rs. 1,171/5/6 was passed in favor of the Plaintiffs with proportionate costs throughout. The Plaintiffs were also entitled to recover interest on Rs. 1,042/5/6 at the rate of 6 percent per annum from the date of the suit's institution until realization. The cross-revision petition filed by the defendants was dismissed with costs.