1966 (5) TMI 71 - HC - Indian Laws

Summary

Issues Involved:
1. Whether the defendants entered into Gur transactions mentioned in the Schedule I, filed by the plaintiff, as pakka arhtias.
2. Did the plaintiff-firm actually enter into transactions in dispute on behalf of the defendants with other parties and pay them the losses in question?
3. Whether the transactions in suit are of wagering character, and if so, to what effect?
4. Whether the Gur transactions in suit were declared illegal on 14th February, 1950, by the Government and what is its effect?
5. Whether the dealings between the parties were as between principal and principal?
6. To what amount by way of losses, Arhat, interest and other incidental expenses are the plaintiffs entitled to?
7. Did the plaintiff-firm have authority to settle the transactions on 14th February, 1950, or 15th February, 1950, before the due date, and if not, what is its effect?
8. Relief.
9. Whether the Vishnu Exchange Ltd. had authority to pass Resolution referred to in para 5A of the plaint, and are the defendants bound by the same?
10. Whether the said Resolution was ante-dated and a fraud on the Government Notification, dated the 15th February, 1950? If so, to what effect?

Issue-wise Detailed Analysis:

Issue 1: Whether the defendants entered into Gur transactions mentioned in the Schedule I, filed by the plaintiff, as pakka arhtias?
The court concluded that the transactions between the parties had been entered into as principal and commission agent and not as principal and principal. The transactions mentioned in "I" were not fabricated.

Issue 2: Did the plaintiff-firm actually enter into transactions in dispute on behalf of the defendants with other parties and pay them the losses in question?
The court found that the plaintiff-firm did not actually pay losses to third parties. The evidence provided, including the account-books, was insufficient to establish that the payments were made on behalf of the defendants.

Issue 3: Whether the transactions in suit are of wagering character, and if so, to what effect?
The transactions were held not to be wagering in nature. The court decided this issue in favor of the plaintiff.

Issue 4: Whether the Gur transactions in suit were declared illegal on 14th February, 1950, by the Government and what is its effect?
The Gur transactions for forward delivery were declared void on 15th February, 1950, by a Government notification. The court held that the defendants were not bound by the resolution of the Exchange.

Issue 5: Whether the dealings between the parties were as between principal and principal?
The court concluded that the dealings were between principal and commission agent, not principal and principal.

Issue 6: To what amount by way of losses, Arhat, interest and other incidental expenses are the plaintiffs entitled to?
In view of the decision on other issues, this issue did not arise for decision.

Issue 7: Did the plaintiff-firm have authority to settle the transactions on 14th February, 1950, or 15th February, 1950, before the due date, and if not, what is its effect?
The court concluded that the plaintiff-firm had no authority to settle the transactions in dispute on 14th February, 1950, before the due date. The Vishnu Exchange did not pass the resolution on that date; it was passed subsequently and ante-dated to avoid the effect of the notification.

Issue 8: Relief
The plaintiff's suit was dismissed.

Issue 9: Whether the Vishnu Exchange Ltd. had authority to pass Resolution referred to in para 5A of the plaint, and are the defendants bound by the same?
The court concluded that the Vishnu Exchange had authority to pass the disputed resolution, but it did not pass it on the date claimed. The resolution was passed subsequently and ante-dated.

Issue 10: Whether the said Resolution was ante-dated and a fraud on the Government Notification, dated the 15th February, 1950? If so, to what effect?
The court found that the resolution was indeed ante-dated and a fraud on the Government notification. Therefore, the defendants were not bound by the resolution.

Conclusion:
The appeal was dismissed, and the plaintiff's claim was not upheld. The court found that the plaintiff-firm did not have the authority to settle the transactions before the due date and that the transactions were not wagering in nature. The Gur transactions were declared void by the Government notification, and the resolution by the Vishnu Exchange was found to be fraudulent and ante-dated.