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TMI Blog1995 (11) TMI 451X X X X Extracts X X X X X X X X Extracts X X X X ..... d the respondents as defendants. 3. The facts in brief leading to this appeal are that the plaintiffs are a trading firm registered under the Indian Partnership Act, having its Office at Station Road, Ahmednagar. The defendants are a Company registered under the Indian Companies Act as a Public Limited Company having its Registered Office at Pune, The defendants are the manufacturers of Scooters called Vespa Scooters and Vespa Auto-rickshaws, hereinafter referred to as Vespa commercials. Due to the shortage of automobiles at the relevant time the Central Government in exercise of its powers conferred by Section 18(G) of the Industries (Development Regulation) Act, 1091 had promulgated an Order called the Scooter (Distribution Sale) C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , therefore, filed the suit for damages for wrongful termination and rendition of accounts. 4. The defendants contested the suit by denying the allegation that they and appointed the plaintiffs as their agent. The defendants denied the relationship of agent and principal as alleged by the plaintiffs. The defendants pleaded that they had never appointed the plaintiffs as their sole, permanent and irrevocable agents but their relationship was that of principal to principal. The plaintiffs used to pay for the said automobiles and sell them independently. The defendants asserted that it was not a fact that plaintiffs were appointed distributors. The demand for supply was greater than the capacity of the defendants to manufacture the vehicles ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court affirmed the judgment and decree of the Trial Court and dismissed the plaintiffs appeal against which this appeal under Article 136 (1) of the Constitution of India has been preferred. 6. Learned counsel for the plaintiffs-appellants contended that the distribution and sale of the Vespa Scooters and Vespa Commercials were regulated and controlled by Scooter (Distribution Sale) Control Order, 1960 and after the plaintiffs were appointed as sale distributors by the defendants the defendants were under an obligation to sell the products to the customers whose orders were booked by the plaintiffs for which the defendants gave their own guarantee/warranty for the vehicles manufactured by them and the defendants also gave guarantee car ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whom such act is done or who is so represented, is called the principal . It has, therefore, to be seen whether in the present case the plaintiffs were employed by the defendants to sell their products i.e. Vespa Scooters and Vespa Commercials to the customers on their behalf or while so dealing they represented the defendants in the transaction with third parties i.e. the ultimate purchasers of the vehicles so as to bring the defendants in the category of the principal and the plaintiffs as their agent. 9. In order to determine the relationship between the parties it would be appropriate to look to the contents of letter dated 9.10.1964 by which the plaintiffs were appointed as dealers/distributors by the defendants of their produc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uced by the parties on record has to be looked into, One Hastimal Chandmal Muner, a partner of the plaintiffs firm was examined as a witness who deposed that the talks took place in his presence in respect of the dealership with one Firodia who represented the respondents and thereafter the letter dated 9.10.1964 was received by the plaintiffs. According to the terms of the dealership the dealer was to get the difference between the retail and wholesale price. He stated that when the scooter was sold to the customer, the customer was entitled to three free servicings thereof by the plaintiffs for which the plaintiffs were paid ₹ 21/- by the respondents. He admitted that the company used to despatch the letters to the plaintiffs mentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the contract would have been entirely different. It cannot be disputed that even an agent can become a purchaser when the agent makes payment of the price to the principal on his own responsibility. In such a circumstance the agreement would be one between vendor and purchaser and not one of principal and agent. 13. Here a reference may be made to a decision of this Court in the case of State of Mysore Vs. Mysore Spinning and Manufacturing Company Limited [AIR 1958 SC 1002] in which the manufacturer sold the goods to the licensed export dealers who exported the goods to the foreign buyers were agents of the manufacturer or the export dealers themselves were the principals and not the agent of the manufacturers. This Court took the view t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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