979
UNION OF INDIA
_v._
SITA RAM JAISWAL
_October_ 28, 1976
#### [A. N. RAY, c. J., M. H. BEG AND P. N. SHINGHAL, JJ.]
_Pleadings under-section_ 70 _of_ _the Contract_ _Act_ _(Act_ 9) _1872,--lngredients_
_111ecessary_ _to_ _be pleaded._
_P1"'ctice-No11-s11iting for want_ _of_ _uroper pleadings at the appellate_ _swge_ _by_
_**the**_ _**Suprcn1e**_ _**Court**_ _**when**_ _**parties**_ _**went**_ _**to**_ _**trial and issues were raised and**_ _**the**_
_.litigation went through the course_ _of_ _trial and appeal is not desirable._
**A**
_CiviltProcedure Code_ _(Act_ 5 _of_ 1908) _Order_ _Vf_ _r/w_ _Order_ _XIV,_ _rnle_ 1(5)
_-Courts_ _should not allow parties_ _to_ _go_ _to_ _trial_ i11 _rhe_ _absence_ _of_ _proper plead-_ **C**
_.ings._
_Words and_ _phrases-"Restoration .._ _in Section_ 70 _of_ _the Contract Act, mean-_
_.ing of._
In a suit for the recovery of price of "Mac Tntyre Sleeves, "supplied to the
.appellant, but alleged fo have been wrongfully rejected a[t.;r a considerable time,
·the respondent/plaintiff sought- to make the appellant/defendnnt lial'k to com·pensate by reasons of provisions containing in Section 70 of the Imlian Con- **D**
·tract Act. The trial Court found that the goods were accepted and it dismissed
the suit on the reasoning that the appellant offered to restore the goods. But
•On appeal, the Division Bench decreed the suit, not on the rrinciples of Section
_10_ of the Contract Act, but treating the case of the respondent to be "a claim
-. for damages for wrongful rejection and for non-acceptance of goods on the
·footing of uninforceable contract for sale of goods".
Dismissing the appeal by certificate the, Court,
HELD : ( 1) The three ingredients to support the cause of action under
- section 70 of the Indian Contract Act are : First, the goods are to be delivered
·1awfu!ly or anything has to be done for another person lawfully. Second, the
thing done orj the· goods delivered is so done or delivered "not intending to do
·so gratuitously". Third, the person to whom the goods are delivered "enjuys
**E**
·the benefit thereof". It is only when the three ingredients are pleaded in the
·plaint that a cause of action is constituted under section 70 of the 1 nclia Contract Act. If any plaintiff pleads three ingredients and proves the three features **F**
·the defendant is then bound to[ make compensation in respect of or ta restore
·the things so done or delivered. [980 G-H, 981 A]
(2) Courts should not allow the Jlarties to gel to trial in the absence of proper pleadings. In the instant case, the Court should not have allowed the res·pondem to go to trial with a claim under-section 70 of the Indian Contract
Act. [981 B-C]
·,
(3) When parties went . to trial and issues were raised on claims and the
'litigation also w~nt through the course of trial and appeal, non-suiting for want
·of proper pleadmgs at the appellate stage, by the Supreme Court is not desirable. [981 C]
( 4) Restoration under-section 70 of the l ndian Contrnct Act does not mean
Testoration of "goods by actual delivery". Intimation to take back the goods
rejected evinces intention of restoration. [982 B-C]
G
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1762 of 68. **H**
(Appeal from the Judgment and Decree dated 18-5·-1967 of the
<Calcutta High Court in Appeal from Original Decree No. 183/56).
980 SUPREME COURT REPORTS [1977] 1 S.C.R.
A _G._ _L. Sanghi_ and _Girish Chandra,_ for the Appellant.
_Purushottam Chatterjee_ and _Sukumar Ghose,_ for the respondent.
The Judgment of the Court was delivered by
B RAY, C.J.-This appeal by certificate is from the judgment dated
l l April 1968 of the High Court at Calcutta.
The respondent filed this suit again'st the appellant in the High ~ourt
at Calcutta and claimed Rs. 76,691-2-0 with interest or in the alternative Rs. 78,204-8-4. The respondent's case in short is that the respondent delivered to the defendant appellant pursuant to severat orders
C from time to time goods described as Mac lntyre Sleeves and other
good's. The respondent alleged in the plaint that the appellant "wrongfully purported to reject the Mac lntyre Sleeves" supplied by the respondent. The respondent further alleged that the rejection was unlawful inasmuch as the rejection was after lapse of reasonable time. The
respondent claimed the sum mentioned in the plaint as reasonable price
of the goods. The alternative case of the respondent is that the plainD tiff respondent wa·s entitled to the sum for supply of Mac lntyre Sleeves
because the same were not supplied gratuitously.
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E
F
G
H
The appellant denied in the written stafument that there was any
enforceable contract, and, therefore, the respondent was not entitled
to sue for price of the goods delivered. The appellant took the plea
in bar of the suit that there was no contract in compliance with section
175 of th_e Government of India Act, 1935. The appellant pleaded fo
the alternative case of the respondent by alleging that the goods were
lawfully rejected because the goods were found not to be of the correct
description and quality. The appellant further denied that the rejected
goods were retained after lapse of reasonable time without intimating
the rejection.
At the trial the respondent found that the claim for the sum of
money as price of goods could not be sus!fuined because of lack of
enforceability of contract. The respondent therefore sought to make
the appellant liable to compensate the respondent by reason of provisions contained in section 70 of the Indian Contract Act.
Counsel for the appellant raised the plea at tfle trial that there
was no foundation in the plaint for any case under section 70 of the
Indian Contract Act.
The three ingredients to support the cause of action under section
70 of the Indian Contract Act are these : First, the goods are to be
delivered lawfully or anything has to be done for another person
lawfully. Second, the thing done or the goods delivered is so done·
or delivered "not intending to do so gratuitously". Third, the person
to whom the goods are delivered "enjoys the benefit thereof". It is
only when the three ingredients ar~ pleaded in the P.laint that a cause·
of action is constituted under section 70 of the Indian Contract Act.
•,
_I_
\
#### _f_
UNION _V._ SITA RAM JAISWAL _(Ray,_ _C._ J.) 981
If any plaintiff pleads the three ingredients and proves the three fea- A
tures the defendant is then bound to make compensation in respect
of or to restore the things so done or delivered.
The allegation in the plaint in the present case was as follows.
"In any event the plaintiff is entitled to the said sum of Rs. 26,248-7-0,
and Rs. 50,442-11-0 with interest for the said Mac Intyre Sleeves,
Copper Strips and Stay Shackles for the same were not supplied gra- B:
tuitiously''. The plaint lacked the two other essential feature's to
constitute a cause of action under section 70 of the Indian Contract
Act. These were that the respondent delivered the goods lawfully
to· tM appellant and that the appellant enjoyed the benefits thereof. ·
The Court should not have allowed ti)~ respondent to go to trial in
the pre~nt case with a Claim under section 70 of the Indian Contract
#### Act in the absence of proper pleadings. c
In view of the fact that parties went to trial and issues were raised
on claims under section 70 of the Indian Contract Act and the litigation went through the course of trial and appeal we do not desire to
non-suit the respondent at this stage.
The Division Bench on appeal held that the goods were accepted
by the appellant. The Division Bench held that title to the goods
passed and if title passed then the whole context of section 70 of the
Indian Contract Act would be irrelevant. The judgment of the F·
Division Bench is confused. The Division Bench treated the case of
### the respondent to be "a claim for damages for wrongful rejection".
Under the Sale of Goods Act when there is any enforceable contract
the seller may claim for price of goods sold or damages for non acceptance. The present cas.e .coul~ not be supported on the footing of any
enforceable confnkt g1vmg nse to damages for non-acceptance or
wrongful rejection. The reasoning of the Division Bench in allowing G:
the claim is erroneou·s.
T~e evidence in the ~resent case as found by the trial court is that
the signatures of Rodencks and Francis on the challans indicate
acceptance of the goods, and, .therefore, the rejection is wrongful. The
finding of the trial court that tpere was acceptance of the goods
obviously repels any plea of rejection of the goods. 1£
The error of t~e ~rial court. was that it found the goods were
accepted and yet d1sm1ssed the smt on the reasoning that the appellant
The trial court held that the goods were not properly rejected.
But the trial court also held that the wordings of the rejection memos
neg~tived any case of enjoyment of benefit. The trial court said that
the documents show that the goods were not utilised or u'sed by the
appellant and the appellant disclaimed interest in the. goods. The
trial court also found that the respondent accepted the goods. The
findings are inconsistent. The trial court held that the appellant
offered to restore the goods to the respondent but the respondent refused to take them back. The trial court dismi'ssed the suit. When
the trial court found that the goods were accepted there could be no
question of restoraJion. The trial court should have decreed the suit.
])
**B**
### c
D
E
982 SUPREME COURT REPORTS [1977] 1 S.C.R.
offered to restore the goods. The error of the Division Bench was in
decreasing the suit not _gn the principles of section 70 of the Indian
Contract Act but d'n damages for non acceptance of goods on the
footing of unenforceable contract for sale of goods.
In view of the fact that there was acceptance of the goods no
question of restoration arises. Counsel for respondent argued that
restoration under section 70 of the Indian Contract Act meant that
the defendant would have to restore the goods to the plaintiff by delivering the sam~e to the plaintiff. This contention of the plaintiff respondent is utterly unsound. As long as there is intimation by the
defendant to the plaintiff that the plaintiff can take back the gooas the
deferldant evinces intention of restoration. In the present case no
question of restoration arises because of the acceptance Qf the .goods.
The respondent in view of the trial court and the Division Bench
of the High Court allowing the respondent to go on with the claim
under section 70 of the Indian Contract Act became entitled to compensation for .the goods accepted. The High Court found that the respondent had received a sum of Rs. 7,602-0-0 out of the claim of
the claim under section 70 of the Indian contract Act and the respondent has been given a decree for Rs. 69,069-1-0 we order that the
parties will pay and bear their own costs in this appeal. We ~pci:ify the
period of two months for payment of the aforesaid sums o( money
Rs. 76,671-1-0. The High Court gave a decree for the sum of
Rs. 69,069-1-0.
For the foregoing rea·sons there will be a decree for
**Rs. 69.069-1-0.** '
The High Court awarded half costs of the trial and full costs of
the appeal. We do not wish to disturb those two orders for costs.
In view of the fact that there was no proper ca>e pleaded to support
:S.R. _Appeal dismissed._
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