9911796707
TMI Blog1970 (11) TMI 107X X X X Extracts X X X X X X X X Extracts X X X X ..... India Jute & Hessian Exchange Limited, hereinafter called the "Exchange", which is the only association recognised under the provisions of the Forward Contracts (Regulation) Act 1952, hereinafter called the "Act". The respondent is not a member of the said association. On December 21, 1962 a transactions was entered into between the parties by means of a letter written by the respondent to the appellant. This letter was in the following terms : "We have today bought from you the following goods Description : Jute Carpet Backing cloth bound of cardboard cores 152" wide. Weight : 9 oz on 36". Wrap Ends Per Inch 15. Weft Ends : Per Inch 13. Oil contents: Upto 2% Quantity. 5,000 Rolls, each roll having con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant referred its Claim to the arbitration of Bengal Chamber of Commerce and Industry. this was purported to have been done on the footing that the contracts provided that all terms and conditions thereof would be governed by the bye-laws of the Exchange for trading in transferable specific delivery contracts. The standard contract forms and the rules and bye-laws of the Exchange, inter alia, provided for arbitration of the Bengal Chamber of Commerce and Industry. When the Chamber proceeded with the arbitration pursuant to the reference the respondent filed a petition before the Calcutta High Court on February 19, 1966 under S. 33 of the Indian Arbitration Act 1940. It was prayed that the extent and validity of the arbitration agreement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d contract entered into otherwise than in accordance with the bye-laws illegal under sub-section (3A) of section 15. (b).................. " Under s. 15(1) the Central Government may by notification declare the circumstances in which the forward contracts in notified goods would be void and illegal. Sub-section (2) of S. 15 provides that any forward contract in goods entered into in pursuance of sub-s. (1) which is in contravention of any of the bye-laws specified in this behalf under cl. (a) of sub-s. (3) of s. 11 shall be void. Sub-section (3A) makes any forward contract in goods entered into in pursuance of sub-s. (1) which at the date of the contract is in contravention of any of the bye-laws specified in this behalf under cl. ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any of the Bye-laws 1 (c), 13, 14, 15 and 16 of-C hapter V shall be illegal under the provisions of Section 15 (3A) of the Forward Contracts (Regulation) Act,1952." The main controversy has centered on the question whether the contracts out of which the disputes arose were in the form set out in Appendix II in the Working Manual. It was maintained by the appellant that although the contracts out of which the disputes arose did not strictly conform to the prescribed form but they were substantially, in the same terms as were contained in the form. As only substantial compliance was necessary the appellant could not be denied the benefit of bye-laws contained in Chapter X of the Working Manual relating to arbitration. Byelaw (1) of that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of bye-law 17 ,of the same Chapter. The learned Judge noticed in particular the absence, of any term in the contracts similar to clause (2) in the prescribed form in Appendix II which is as follows "Buyers to give............. clear working days notice to place goods alongside." Now in the contracts no such term appeared that the buyers would give clear notice to place goods alongside, of the number of 'working days specified. It has been contended before us on behalf of the appellant that the mere absence of this condition or term in the contracts was not sufficient to take them outside the prescribed form which had only to be substantially complied with and it was not necessary that blanks in each and every condition in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... true that in the letters evidencing the contracts it was Mentioned "all other terms and conditions of the East India and Hessian Exchange standard contract will be applicable", which may be taken to import conditions 1 to 7 given in the penultimate column of the prescribed form. There Would still be non-compliance with condition No. 2 reproduced before. Even if it was not necessary to use the same language the number of clear working days had to be specified which was not done in the contracts in dispute. Condition No. 2 cannot be regarded as inconsequential because it must be stipulated how many working days notice has to be given by the buyers to place goods alongside "export vessel in the Port of Calcutta". Litera ..... X X X X Extracts X X X X X X X X Extracts X X X X
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