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TMI Blog1953 (12) TMI 32X X X X Extracts X X X X X X X X Extracts X X X X ..... time by mutual agreement up to 20th December 1944. But although the plaintiff firm applied for delivery, the shares were not delivered by the defendants. By reason of such failure to give delivery, the plaintiff firm, on 21st December 1944 purchased the said 4,000 shares in open market for and on account of and at the risk of the defendants and thereby suffered a loss of ₹ 13,862/8/- being the difference between the price at which the plaintiff firm purchased the shares from the defendants and the price at which the plaintiff firm was compelled to buy the said shares from the market on account of the defendants. The particulars of such damages are set out in paragraph 12 of the plaint. The defendants in their firm of Bilasray Khe-mani had drawn and made over to the plaintiff firm a post dated cheque for ₹ 7,237/87- bearing date 1st January 1945 by way of marginal security for the fulfilment of the said contract but the cheque was dishonoured by non-payment on presentation to the bank. 3. The defendants 1 and 2 have filed a joint written statement. The defendants 3 and 4 have together filed a separate written statement. 4. In the written statements several def ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hares of Barakar Coal Co. Ltd. and the defendants were the sellers. In support of this case oral and documentary evidence have been adduced on behalf of the plaintiff firm. Raghunath Prosad Sharma has stated that the plaintiff firm acted as a principal and not as a broker in respect of the transaction in suit which was entered into on the 29th November 1944 (Qs. 50, 205, 206). The Daily Transaction Book (Ex. A) which records the transaction under date 29-11-44 shows that the plaintiff firm entered into the transaction with Bilasrai Khemani. The Share Ledger entry (Ex. B) under date 29-11-44 contains entries to the same effect at page 55 thereof. The party ledger book of the plaintiff (Ex. C) under date 29-11-44 records entries relating to the transaction in question with Bilasrai Khemani. It appears from the Nakal book (Ex. P) that a sum of ₹ 13,862/8/- has been debited to Bilasrai Khemani under date 22nd December 1944 on account of purchase and sale of 4,000 Barakar Coal shares which took place between the plaintiff firm and Bilasrai Khemani. It further appears from that book (page 13) that 4,000 shares were brought by the plaintiff from Bilasrai Khemani on 29-11-44 and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 shares under contract No. 499 dated 29th November 1944. The letter also records the fact that the date of delivery of the shares was extended by mutual agreement upto 20th December 1941 and it also records the circumstances under which a post dated cheque for ₹ 7237/8/- was made over by Bilasrai Khemani to the plaintiff firm. Raghu-nath Sharma has proved by reference to the Peon Book of Mr. B. M. Bagaria that this letter was delivered to Bilasrai Khemani, the defendant No. 1 by a peon but Bilasrai refused to acknowledge receipt of that letter by signing on the Peon Book. It may be noted that the evidence of Sharma (Q. 109 to 119) on this point of delivery through a peon has not been challenged in cross-examination, though of course Bilasrai has in course of his evidence denied that he received any such letter. It may be that as no reply was given to this letter, at the time, contradicting the statements contained in this letter the defendants have now taken up the attitude that no such letter was ever received by the defendants. It appears that another letter dated 21st of December 1944 (Ex. J) was sent by the plaintiffs' solicitors under Certificate of Posting and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... huj Bajoria acted as under-broker in the transaction, yet he has not made any serious suggestion that there was any disclosed or undisclosed principal for whom the plaintiff firm acted as broker in respect of the contract dated 29th November 1944. 16. Mr. Agarwala has drawn my attention to the case of -- 'Sewdut Roy Maskara v. Nahapiet' 34 Cal 623 (D), in which the words used in the Bought Note were bought for you and In the Sold Note the words were sold for you and in addition there was in the Sold Note a provision for brokerage at a certain rate. In the plaint also in that case it was alleged that the plaintiffs acted in their capacity of brokers. Harrington J. upon a consideration of the evidence in that case and upon construction of the language of the Bought and Sold Note made the following observations : I have come to the conclusion that the plaintiffs did in fact purport to act as brokers for the defendants. First, they say in the plaint that they took the defendants' order for the purchase and sale of jute in the capacity of brokers. Secondly, the language of the memoranda, 'We have bought for you 1,000 bales' and 'we have sold for you 50 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n-law to the defendant Bilasrai Khemani. 18. If the matter had rested solely on the contract dated 29-11-44 and no other evidence would be forthcoming, then I would have very little hesitation in dismissing the suit, following the principles enunciated in -- '34 Cal 628 (D); -- 'Ramji-das v. Jankidas', 39 Cal 802 (E) and -- 'A 19. But the half hearted manner in which the defendant tried in the witness box to support the case, that the plaintiff firm acted merely as broker in the transaction, convinces me that the defendant Bilasrai knew that although the plaintiff firm was making some profit by charging some commission or brokerage in the transactions the plaintiff firm was really acting as principal and on their own account and not on behalf of any disclosed or undisclosed principal and I am further convinced that Bilasrai had consented to the plaintiff firm so acting in the transaction. In his examination in chief all that Bilasrai could be induced to state, after repeated endeavour of his counsel, Mr. Agarwalla, is that he had share transactions with Sohanlal Pachisia through Chatur-bhuj Bajoria who acted as a broker. He knew that Sohonlal Pachisia was a br ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by Mr. Ehuramull Agarwala the learned counsel for the defendant that as the plaintiff firm was not properly registered in the Register of Firms maintained by the Registrar of Firms under the provisions of the Indian Partnership Act, the suit as framed is not maintainable. It is pointed out that the Statement which was filed by the partners before the Registrar of Firms (Ex. I) contained a declaration that out of the four partners who carried on business under the name and style of Sohanlal Pachisia Co., the partners Duttalal Mohenderia and Jagadish Kumar Gupta retired from the partnership on 1st January 1945 and the other two partners, Sohanlal Pachisia and Sewchandrai Dabrl-walla continued to carry on the business of the plaintiff firm in co-partnership on terms conditions contained in a Deed of partnership dated the 23rd August 1945, but in the Register of Firms all the four persons are shown as partners of the firms on 5th September 1945, the date on which the partnership was registered with the Registrar of Firms and consequently the registration is defective and the suit also has not been properly instituted. I do not think that there is any substance in this contention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . I that the deed of partnership dated 23rd August 1345 is an operative document, it is not open to the learned counsel for the plaintiff to contend that the deed dated 23rd August was not intended to be given effect to. 26. Mr. Agarwala also contended with reference to certain documents produced by Lalit Mohan Banerji, the representative of the Calcutta Stock Exchange, which have been marked as Ex. II, that one Gouri Sankar Mantri became a partner of the plaintiff firm on or about 15th August 1945 but he has not been registered as a partner in the Register of Firms and so the suit is not maintainable. It is clear, however, from the evidence of Raghunath Prosad Sharma that this person was brought in as a partner only for the limited purpose of doing business on behalf of the plaintiff firm in the Stock Exchange but he was not really a partner in the strict sense of the term nor had he any right to participate in the profits of the firm and he was also not liable for any loss of the firm. Moreover, this individual was not a partner at the time of the accruing of the cause of action and further he had nothing to do with the transaction in suit. There is thus no force in this conte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d date, and further he would have been made a party to the deeds in his capacity of a partner. 29. In the case before Panckridge J. there was ample evidence of dealings as partners as far as Murlidhar and Keshardeo were concerned, but in the case before me, there is no evidence, besides the fact that Mantri has been recognised as a partner by the Stock Exchange, that Mantri ever had dealings as a full fledged partner of the plaintiff firm. Further as I have pointed out before, Mantri had no relation to the cause of action for the suit. He became a partner, if at all, after the accruing of the cause of action. 30. Mr. sethia submitted that the documents produced by the Stock Exchange are inadmissible in evidence. He relies on a decision of Sarkar J. in -- 'Suit no. 1736 of 1940, D/- 1-3-1951 (Cal) (G)'. In that case a Register showing the constitution of a certain firm of members of the Stock Exchange was held as inadmissible. In the case before me a Partnership Form and Declaration signed by the plaintiff firm and Mr. Mantri which were filed in the Stock Exchange have been sought to be tendered. In my view they are admissible as admissions against the plaintiff under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the plaintiff. ISSUES 2(a) and 2(b): 35. The point argued by Mr. Agarwala on these Issues is that Section 45 of the Indian Contract Act, requires that promises made to joint promisees are to be enforced by all such promisees jointly and as two partners Duttlal Mohenseria and Jagadish Kumar Gupta are not properly on the Register of Firms, the suit must be treated as by two partners only, namely Sohanlal Pachisia and Sewchandrai Dabriwalla and so the suit claiming performance of the promise is not maintainable. Raghunath Prosad Sharma in answer to Q. 224 has stated that the suit has been instituted on behalf of the partners of the plaintiff firm who on 6th September 1945 were partners of the firm, and his evidence further is that all the four persons were partners (Q. 219 and other questions). The entry in the Register of Firms under date 5th September 1945, as I have pointed out already, shows that four persons are shown as partners of the firm on that date and the firm was registered on that date. Thus all the persons who were partners of the firm, at the time when the promise was made by Bilasrai Khemani and at the time of the accruing of the cause of action (Order 30, Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... count of and at the risk of the defendants. The cheque of 1st January 1945 was attempted to be cashed after the due date but it was dishonoured (See letter of 4th January 1945). It appears to me that the case of the plaintiff firm is true and the date of delivery was extended till the 20th December, 1944. ISSUES 4 (a) and 4 (b): 37. Bilasrai Khemani has admitted in course of his evidence that he had given instructions to persons looking after his business at Calcutta not to accept any registered letter coming from an attorney. He has also admitted that the addresses on the envelopes containing the letters dated 21/22nd December 1944 and 4th January 1945 are correct. So the letters must have reached the destination but as nobody accepted the letters on behalf of the addressee, the endorsements of refusal were made on them and they came back to the sender. The oral evidence of Sharma and the correspondence of the plaintiff's solicitors show that attempt was made to get delivery of the shares on the 1st December, 3rd December, 5th December 1944 but the date was finally extended up to 20th December 1944. On the 5th December 1944 the plaintiff firm made out a bill for the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it was represented to him that they were members of a joint family or carried on a joint business, is unreliable. I hold that the defendants were not members of a joint family nor did they carry on any joint business at the material time. There can be no doubt however that a decree against the defendant Bilasrai Khemani alone, can be passed in the facts and circumstances of this case. 41. Mr. Agarwalla pointed out that the plaintiff firm has made one kind of case about the defendants being held out as joint proprietors of the business in the letter supplying particulars dated 16th January 1946 and a different kind of case in the witness box. I do not think so. Raghunath has made the same case in answers to Q. 33 and Q. 607-645, though no doubt he has been forced to modify it to a certain extent in course of his cross-examination. Though the evidence on this issue of both parties is insufficient and the defendants could have produced more satisfactory evidence, I am inclined to accept the evidence of Bilasrai Khemani on the point in preference to the oral testimony of Raghunath. The plaintiff firm has made several alternative cases about jointness of the business in the plaint as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rformed: --('Wertheim v. Chincoutimi Pulp Co.' 1911 AC 301 (P) at p. 307 and -- 'Williams Brothers v. Ed. T. Agius Ltd.' 1914 AC 510 (Q); see also Section 73, Contract Act and illustration (a) to the section). In the present case the plaintiff firm could not get the shares till the next day. So the market rate on that date can be taken into consideration and damages awarded on the basis of such rate. 46. I am unable to accept the further argument of Mr. Agarwalla that there is no evidence of the prevailing market rate of the 21st December 1944, and so no damages can be awarded. It is true that no independent evidence of any broker or dealer has been produced nor the official quotations of the Stock Exchange have been tendered in evidence. But this is, because, no specific issue was raised on the point and it was not suggested at the time of the settlement of issues that the defendants were specifically disputing the rate on the basis of which the claim was laid in the plaint. It is only at the stage of argument that the learned counsel argued that the rate had not been proved. Raghunath Prosad has however stated in answers to questions 156-157, 163, 585 and 672 w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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