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TMI Blog1960 (4) TMI 81X X X X Extracts X X X X X X X X Extracts X X X X ..... r the purchase of jaggery in November-December, 1946 and in that connection, paid various sums of money to the defendant firm either in Pakistan or at Meerut. According to the plaintiffs, it was agreed that the defendants would render accounts and arrange payment of the balance that may be found due to the plaintiffs at Sibi in Pakistan. On Asad 18, samwat 2004 corresponding to 8th August, 1947, the defendant firm sent an account to the plaintiffs' firm at Sibi according to which the defendant firm acknowledged an amount of ₹ 10,825/- as due to the plaintiffs and for the payment of the same amount, they sent two Hundis to the plaintiffs firm at Sibi. The plaintiffs' firm, however, did not think it proper to take payments under the Hundis and returned them to the defendant firm with a direction that the amount may be kept in deposit with the defendants and that the plaintiffs would be coming to Meerut for purchase of jaggery and would require the amount in that connection. Subsequently, in consequence of partition, the plaintiffs had to leave Pakistan and come over to India and, therefore, they could not utilize the amount for the purchase of jaggery and the amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er becomes complete only when it comes to the knowledge of the persons to whom the offer is made and, therefore, the offer should be deemed to be made at the place where it comes to the notice of that person and not at a place from where it is despatched, and, therefore, it could not be said to have been made at Sibi and no part of the cause of action arose there. 8. Secondly, the plaintiffs relied upon a special agreement to the effect that the accounts would be rendered at Sibi and the balance would be paid there. The trial Judge rejected this ground by a two-fold argument: (a) that the deposit of the amount with the defendants had nothing to do with the agency business and should be treated as a separate transaction, and (b) that the fact of agreement cannot be accepted, particularly in view of a condition entered in Ex. P-1 on which the suit was based, reading, Subject to the jurisdiction at Meerut. 9. Lastly, the common law principle that a debtor should find the creditor was relied, upon by the plaintiffs. Dealing with this plea, the trial Judge held that there was no relationship of, creditor and debtor between the parties. 10. On these findings, the Civil Ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e was no bailment of currency in specie to be returned as such. The payment to the plaintiffs was sought to be made through Hundis which were not encashed and were returned. Neither the currency in specie was offered to the plaintiffs, nor was it returned to be kept in specie. It must be borne in mind that a deposit and loan are not mutually exclusive. The deposit will generally involve only the creation of the relationship of a debtor and creditor. The conclusion of the two courts below is based upon misconception of the legal position and cannot be accepted as correct. 17. The next question, therefore, that requires to be determined is whether the common law rule, the debtor must seek the Creditor should have been applied or not. The common-law rule about the place of performance of contracts has been stated in the Halsbury's Laws of England, Third Edition, Volume 8, para 288 as follows:- Where no place for performance is specified either expressly or by implication from the nature and terms of the contract and the surrounding circumstances, and the act is one which requires the presence of both parties for completion, the general rule is that the promisor must se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the contract does not say where Messrs. Jeetmull are to pay, but it does say, by an implication which is indisputable, that they are to pay Messrs. Tata Sons and Company and it follows that they must pay where that firm is. His Lordship then concluded that, upon the face of this contract, not indeed in express terms, but by the clearest implication, payment is to be made in Rangoon. The argument that this constitued an importation of a technical rule of the English common law into the Jurisprudence of India was disposed of by an observation that, the simple answer to that would have been that, on the contrary, it was a mere implication of the meaning of the parties. A further argument that section 49 of the Indian Contract Act displaces the rule was met and it was held that it is not possible to accede to the contention that section 49 of the Indian Contract Act gets rid of inferences, that should justly be drawn from the terms of the contract itself or from the necessities of the case, involving in the obligation to pay the creditor the further obligation of finding the creditor so as to pay him. 19. What principles should be deduced from this decsion will be taken up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the non-petitioners is Ramalmga Iyer v. Jayalakshmi, AIR 1941 Mad 695, Leach C. J. in doubt- ing whether the common law rule had full force in the country, adopted the following principle:- In the first place, the terms of the contract are to be looked at and, if they do not help, the Court must have regard to the necessities of the case in deciding whether the rule should be applied. In the same case, Somayya J. observed as follows : If the common law rule of England is to be invoked as a mere aid in finding out the place of performance of a contract, I have no objection to its being so used and that is the way in which the Judicial Committee used it in ILR 5 Rang 451 : (AIR 1927 PC 150), but if it is argued that in every case of debtor and creditor, the rule is to be applied without considering either the terms of the contract or the circumstances attending on it or the necessities of the case, I have no hesitation In rejecting the contention. The question whether the common law rule of England is to be applied to a country of vast distances as India has to be considered with care. 22. The learned Judges in this case also- did not appreciate the conclusion fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bt, and should determine the forum. There arc several cases, where the rule has been applied in the manner indicated above. See Champaklal v. Nectar Tea Co., AIR 1933 Bom 179, Md. Esuff v. M. Hatcem and Co., AIR 1934 Mad 581 and Shimoga Oil Mills v. Radhakrishna Oil Mills, AIR 1952 Mys 111, cited by Mr. d. P. Gupta appearing for the petitioners. In addition, I noticed two cases, Tulsiman Bibi v. Abdul Latif, AIR 1936 Cal 97 and Bharumal v. Sakhawatmal, AIR 1950 Bom 111. R. C. Mitter J., in the former and Chief Justice Chagla and Dixit J. in the latter applied the rule even with reference to the creditor's residence at the time of the institution of the suit. The learned Judges in the Bombay case, AIR 1956 Bom 111 observed that the common law rule is a reasonable rule and it is in conformity with justice and equity because it recognises the obligation of the debtor to pay his debt and that obligation can only be discharged by the debtor going to his Creditor and repaying the amount, and the common law rule imposes this obligation only when there is no express contract to the contrary. 27. In my opinion, these two decisions have taken rather the other extreme view and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... him with regard to its performance. 33. All that Section 49 implies is that if subsequent to a contract, the place of performance ot contract, or for that matter the place of payment of debt, is fixed on an application by the promisor with the consent of the promisee, then it will not be open to the parties to apply the rule. 34. Now, the principles which should be deduced from a review of the Privy Council case and various subsequent decisions and a consideration of the statutory provisions, may be stated as follows :- (1) The technical rule that the creditor's residence at the commencement of the suit should determine the forum in the absence of a contract to the contrary should not be applied in India. India is a vast country and it is hardly fair to impose a burden upon the debtor to seek the creditor whereever he happens to go in this vast country. The Privy Council case, AIR 1927 PC 156 is Consistent with this proposition. The contrary authorities in cases, AIR 1936 Cal 97 and AIR 1956 Bom 111 do not in my judgment state the correct law. (2) If the place of performance of contract or for that matter, the place of payment of debt can be shown to be fixed expre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tilize it for the purposed of purchasing jaggery. The lower appellate court, however, records a finding that the place of repayment was Meerut and not Sibi. It is true that this finding has been arrived at generally and vaguely, yet bearing in mind that the defendants were commission agents and the money was deposited with them by the plaintiffs to be utilized by them at Meerut for purchasing jaggery, I am inclined to accept the findings of the lower appellate court and do not see any adequate ground for disturbing the findings in the exercise of the revisional jurisdiction. A further support for this fact is found from the condition stated in Ex. P-1 as there is an implied agreement between the parties that the place of performance will be at Meerut. In this view of the matter the petitioners cannot invoke the aid of this rule for holding that the place of payment should be presumed to be Sibi and that on that basis, the suit was properly instituted. Under the circumstances, I have no alternative, but to reject this revision petition. 36. In the result, the revision petition is hereby dismissed. Looking to the circumstances of the case, there will be no order as to costs. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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