P L D 1959 (W (PLP)

SHABIR AHMAD, J.--‑(14‑12‑1955).‑On 22nd of June 1949, Tasdiq Husain, Conservator of Forests, purchased a Plymouth motor‑car from the Eastern Automobiles Ltd., The Mall, Lahore, and paid Rs. 15,100 including the price of the car and sale tax and other taxes. On 21st of April 1950 he instituted a suit against the Eastern Automobiles Ltd., for recovery of Rs. 15,100 on the ground that when he bought the car it was represented to be a model for the year 1949 while in fact it was one for the year 1948. This suit was decreed with costs subject to the condition that the car was restored to the defendant and against that decree the defendant has preferred the present appeal. In the plaint the claim of the plaintiff was based mainly on the allegation that the car sold to him was a 1948 model of Plymouth and not 1949 model which it was represented to be, and that if he had known, which the defendant did, that the car was a 1948 model he would not have bought it. In the written statement it was pleaded that the plaintiff had not stipula ted for a 1949 model of Plymouth car and the car sold to the plaintiff was declared to be a 1949 model as it was believed to be of that year. It was added that about five months after the purchase, on the 14th of November 1949, the plaintiff had wanted to return the car and take back the money, but as the car had by then deteriorated and had suffered considerable damage because of its having been involved in two or three accidents, the demand of the plaintiff was not met with. On the pleadings of the parties the trial Judge framed the following issues :‑ (1) Was not the stipulation of sale of the car between the parties with regard to a Plymouth car of 1949 model ? (2) Whether the plaintiff had been using the car in dispute and involving it to accidents ? If so, what is its effect ? (3) Whether the car in dispute was a 1949 model ? (4) If issue No. 3 is answered in the negative and issue No. 1 is answered in the affirmative, then to what extent is the plaintiff entitled ? (5) Relief. Deciding the first and the first part of the second issues in the affirmative, and the third in the negative, the trial Judge said with regard to issue No. 4 that the plaintiff was entitled to the full amount paid by him and the defendant was entitled to the return of the car, but could sue for any damages which the plaintiff was liable to pay as a bailee for the period he had been using the car from the date of his election to rescind the contract to the date of the suit, and consequently passed the decree appealed against. The learned counsel for the appellant did not question the finding of the learned trial Judge on issue No. 3, but urged that the finding on issue No. I was incorrect. As already mentioned, the case of the plaintiff in the plaint was that he had stipulated to buy a 1949 model Plymouth car. In his statement as the solitary witness in support of his case the plaintiff deposed that he wanted to buy a 1949 Plymouth car and had bought the one in dispute as he was given to understand by persons acting for the defendant that the car sold to him was a 1949 model of Plymouth car. He deposed further that it was some months after he had purchased the car that he happened to see some 1948‑model Plymouth cars and finding them to be identical with his own he began to suspect that the car had been sold to him by misrepresentation about its model. In cross‑examination he said that he had agreed to take a. car similar to the one which was standing in the show‑room of the defendant when he visited it a few days before the sale because he was told by the Managing Director of the appellant that the car was of the 1949 model. In answer to another question he said that it was in November or December 1949 that he came to know that the car sold to him was not a 1949 model and that after that he offered to return it if the price paid by him were returned to him, but the defendant did not accept those terms and did not tell him not to use the car. He added that he had warned the defen dant that till his money was returned he would keep on using the car at their risk. The gist of the evidence of the defendant with regard to issue No. 1 was that sometime in April or May 1949 the plaintiff went to the show‑room of the defendant and wanted to buy a new car. At that time a Plymouth car was standing in the show‑room but it had been sold. The plaintiff was told that similar cars were expected shortly and he could be supplied with one. It was, however, tacitly conceded that the car supplied to the plaintiff was a 1948 model, but it was asserted that the plaintiff had not stipulated to buy a 1949 model only and at any rate the car was believed by the defendant's Managing Director and servants to be a 1949 model. It was admitted on behalf of the appellant by the Managing Director of the appellant company in his statement as D. W. 6 that the specifications of the car were filled up by the servants of the appellants in the receipt given to the respondent and in the form presented for registration of the car in the name of the respondent and that in these documents it was stated that the car was a 1949 model of Plymouth. Moreover in a certificate dated 10th October 1949 issued to the respondent it was clearly mentioned on behalf of the appellant that the Plymouth car sold to the respondent was 1949 Plymouth car. In view of all this evidence it was rightly held by the learned trial Judge that the stipulation of sale was that the car was of the year 1949, and the contention of the learned counsel for the appellant, against the decision on this issue must be repelled. The learned counsel for the appellant contended that the car in dispute was represented to be of the year 1949 because the persons acting on behalf of the appellant believed it to be of that year. It was urged that the evidence on the record showed that Plymouth cars bearing Code No. 15 were manufactured in the years 1946, 1947 and 1948 as mentioned in the letter Exh. P. 4 dated 20th December 1949 sent to Mr. Aslam Riaz, Bar‑at‑Law, by the Export Division of the Chrysler Corporation, Detroit 31, Michigan, U. S. A., and the 1949 model of the car had Code Model No. 18, and as no Plymouth car bearing Code No. 18 had till the date of the sale of the car in dispute been received by the appel lant company, it was believed by the persons acting on behalf of the appellant that the car sold to the respondent was a model of the year 1949. It may be that the car was believed by the persons acting for the appellant to be of the 1949 make, but as I do not see how that belief would alter the legal position, I do not consider it necessary to deal with that aspect of the matter. The learned counsel for the respondent did not deny that before the suit was lodged the car in dispute had met with some accidents, but urged that the damage to the car was but nominal and that even the most serious of the three accidents the car was involved in would not affect the rights of the respondent because the respondent had informed the appellant that if the money paid by him as the price of the car were not paid back to him he would continue to use the car at the risk of the appellant. In his state ment the appellant said that he had warned the appellant that till the price he had paid for the car were returned to him he would use the car at the risk of the appellant but this allegation was not made in the plaint nor was any other evidence produced to support the assertion of the respondent. The plaint is a fairly detailed docu ment and I am inclined to think that if the respondent had given the appellant the warning he claims to have given, he would have produced either a copy of the notice sent by him or would have had that notice produced by the appellant. The docu mentary evidence on the record shows that the first accident that the car met with was some time before 1st November 1949 because on 1st November 1949 a bill for Rs. 139‑8‑0 for repairs to the car was sent to the insurance company with which the car was insured. The second accident was in the end of December 1949 because an estimate amounting to Rs. 463‑8‑0 was sent to the insurer of the car in dispute on 29th December 1949. With regard to the third accident to the car in dispute, a letter sent to the insurance company by the respondent himself on 3rd June 1950 states that the car was involved in an accident on the 13th of May 1950. The documents detailed above prove beyond all reasonable doubt that before the suit was instituted the car in dispute had been involved in two accidents and that it met with a third one during the pendency of the suit. It is further clear that it was after the car had met with its first accident that the respondent wrote to the appellant claiming the price of the car as he wanted to rescind the contract of sale entered into between him and the appellant. The question whether or not the fact that it was only after the car had been involved in an accident that the respondent claimed to rescind the contract would affect his claim will be considered later on, if necessary. The trial Judge has held that the appellant had been guilty of fraud and, therefore, the contract was voidable at the option of the respondent. If the case is governed by the Contract Act, 1872, the finding would be unassailable, but the learned counsel for the appellant urged that the contract in the present case was governed by the Sale of Goods Act, III of 1930, and not by the Contract Act. The Act of 1930 in clause (7) of its second section says that " goods " means every kind of movable property other than actionable claims and money and includes stock and shares, growing crops, grass, and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale, and it is obvious that a car is goods for the pur poses of the Sale of Goods Act, 1930. The main question to consider, therefore, is if the relevant provisions of the Contract Act, 1872 are different from those of the Sale of Goods Act, 1930 and, if they are, whether those of the former or the latter Act are applicable to the facts of the present case. The Contract Act in force in Pakistan which was enacted in 1872 as the Indian Contract Act contained specific provisions applicable to contracts about sale of goods in the shape of Chapter VII which consisted of sections 76 to

123. In 1930 the Sale of Goods Act was passed and it was provided in its 65th section that Chapter VII of the Contract Act was repealed. Since the passing of the Sale of Goods Act, III of 1930, therefore, the law applicable to sale of goods is to be found in the Act of 1930. Section 3 of the Act of 1930 provides that the unrepealed pro visions of the Contract Act save, in so far as they are inconsistent with the express provisions of the Act of 1930, shall continue to apply to contracts for the sale of goods. Clause (15) of section 2 of the Sale of Goods Act, 1930 provides that expressions used but not defined in it and defined in the Contract Act of 1872 have the same meanings assigned to them as in the Act of 1872. After fully considering the relevant provisions of the Contract Act, 1872 and the Sale of Goods Act, 1930, I have arrived at the conclusion that while a contract of sale of goods which will be void under the provisions of the Contract Act, 1872 will be void for the purposes of the Sale of Goods Act, 1930 also and be subject to the same consequences under both the Acts, the same cannot be said of the contracts which are treated as voidable under the Contract Act. If a contract of sale is hit by any of the sections 24 to 30 of the Contract Act, 1872, it would be void for the purposes of the Sale of Goods Act, 1930 because there is nothing inconsistent with these sections in any provision of the Sale of Goods Act 1930. Section 19 of the Contract Act, 1872 enacts that if the consent to an agreement has been caused by coercion, fraud or misrepresen tation the agreement is not viod but is a contract voidable at the option of the person who has been subjected to coercion, fraud or misrepresentation ; but that general rule is subject to certain conditions mentioned in that very section. The present case is not one of coercion but that of misrepresentation or possibly of fraud as held by the trial Judge. The definition of fraud is con tained in section 17 of the Contract Act, 1872 which reads as follows:-- 17. "Fraud" means and includes any of the following acts committed by a party to a contract, or with his connivance, or by his agent, with intent to deceive another party thereto or his agent, or to induce him to enter into the contract :‑ (1) the suggestion, as a fact, of that which is not true, by one who does not believe it to be true ; (2) the active concealment of a fact by one having knowledge or belief of the fact ; (3) a promise made without any intention of performing it ; (4) any other act fitted to deceive ; (5) any such act or omission as the law specially declares to be fraudulent. Explanation.‑Mere silence as to facts likely to affect the willingness of a person to enter into a contract is not fraud, unless the circumstances of the case are such that, regard being had to them, it is the duty of the person keeping silence to speak, or unless his silence is, in itself, equivalent to speech. Misrepresentation is defined in section 18 of the Contract Act which reads as follows :‑ 18. "Misrepresentation" means and includes‑ (1) the positive assertion, in a manner not warranted by the information of the person making it, of that which is not true, though he believes it to be true ; (2) any breach of duty which, without an intent to deceive, gains an advantage to the person committing it, or anyone claiming under him, by misleading another to his prejudice or to the prejudice of anyone claiming under him ; (3) causing, however innocently, a party to an agreement to make a mistake as to the substance of the thing which is the subject of the agreement. I may here mention some of the provisions of the Sale of Goods Act, 1930 which in my view have to be considered for the deter mination of the question that arises. Section 4 of the Act says inter alia, that a contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price, and that where under such contract the property in the goods is transferred from the seller to the buyer, the con tract is called a sale, but where the transfer of the property in the goods is to take place at a future time or subject to some con dition thereafter to be fulfilled, the contract is called an agreement to sell. Section 5 of the Act which deals with formalities of the contract of sale provides, inter alia, that a contract of sale is made by an offer to buy or sell goods for a price and the acceptance of such offer, but that it may be one of the terms that goods or price or both will be delivered immediately, or that the delivery of the goods or payment of price shall be by instalments or that the delivery or payment or both shall take place at a future date. Section 12 provides inter alia, that a stipulation in a contract of sale with reference to goods which are the subject thereof may be a "condition" or a warranty", and that a "condition" is a stipula tion which is essential to the main purpose of the contract, the breach of which gives the right to treat the contract as repudiated, while a warranty is a stipulation collateral to the main purpose of the contract and breach of a warranty gives rise to a claim for damages but not a right to reject the goods and treat the contract as repudiated. It is further provided by the section that the question whether a stipulation is a "condition" or a "warranty" depends on the construction of the contract and that though a stipulation may be called a "warranty" in the contract it may yet be a "condition", the decision of the question being obviously left to the Court before which the point arises. The thirteenth section of the Sale of Goods Act, 1930 is in the following terms :‑ 13. (1) Where a contract of sale is subject to 'any condition to be fulfilled by the seller, the buyer may waive the condition or elect to treat the breach of the condition as a breach of warranty and not as a ground for treating the contract as repudiated. (2) Where a contract of sale is not severable and the buyer has accepted the goods or part thereof, or where the contract is for specific goods the property in which has passed to the buyer, the breach of any condition to be fulfilled by the seller can only be treated as a breach. of warranty and not as a ground for rejecting the goods and treating the contract as repudiated, unless there is a term of the contract, express or implied, to that effect. (3) Nothing in this section shall affect the case of any con dition or warranty fulfilment of which is excused by law by reason of impossibility or otherwise. Chapter 3 of the Sale of Goods Act, 1930, which consists of sections 18 to 30, deals with effects of a contract of sale. Section 19 enacts, inter alia, that where there is a contract for the sale of specific or ascertained goods the property in them is transferred to the buyer at such time as the parties to the contract intend it to be transferred. It may here be mentioned that clause 14 of section 2 of the Sale of Goods Act, says that for the purposes of the Act the term "specified goods", means goods identified and agreed upon at the time a contract of sale is made. Section 20 enacts inter alia that where there is an unconditional contract for the sale of specific goods in a deliverable state, the property in the goods passes to the buyer on the making of the contract and it is imma terial whether the time of payment of the price or the time of the delivery of goods, or both, is postponed. It is clear that the sale in the present case was of specified goods because at the time of the sale the car which stood in the show room of the appellant was shown to the respondent. The respondent bought the car under the belief that it was a 1949 model of Plymouth car. The respondent stated that he wanted a 1949 model Plymouth car and though I am not clear that the stipulation that the car was of 1949 model was not a mere warranty I will proceed on the assumption that it was a condition and not a mere warranty. I am of the view, however, that even if the breach in the present case was a breach of a condition it d not give the respondent the right to repudiate the contract. The sale was of specified goods and, therefore, because of section 20 of the Sale of Goods Act, 1930, the property in the car passed to the respondent as soon as the contract of sale was com pleted, and even if the respondent had not taken delivery of the car, the property in it would have passed to him as soon as the contract of sale was complete. In the present case the fact that the respondent t6ok delivery of the car and started using it leaves no room for the argument that the property in the car did not pass to the respondent. It is true that the representation on behalf of the appellant that the car was a 1949 model Plymouth car would under the provisions of the Contract Act amount to misrepresen tation and even fraud, but it appears to me that even if the seller had been guilty of fraud or misrepresentation with regard to goods dealt with in subsection (2) of section 13 of the Sale of Goods Act, 1930, the provisions of the Contract Act, 1872, which made such contracts voidable at the option of the buyer will have no appli cation because the provisions contained in section 13 of the Sale of Goods Act, 1930 being inconsistent with those of the Contract Act, section 3 of the Sale of Goods Act does not make the pro visions of the Contract Act, 1872 applicable to such cases. I may add that what I have said about the effect of fraud and misrepre sentation on contract of sale of goods when the seller is the guilty party is not to be understood to have application when the buyer is guilty of fraud or misrepresentation. It would appear that where the buyer is the guilty party the contract will be voidable as an ordinary contract because as far as I have been able to see there is no provision in the Sale of Goods Act, 1930, which, in cases in which the buyer is guilty of fraud or misrepresentation, makes any provision inconsistent with the provision of the Con tract Act, 1872. Mr. Bashir Ahmad, the learned counsel for the respondent, urged that subsection (2), section 13 of the Sale of Goods Act, 1930, applied to those cases only in which a stipulation which amounted to a condition was to be fulfilled after the property in the goods had passed to the buyer or delivery thereof had been taken, and in this connection relied on the words "breach. of any condition to be fulfilled" occurring in the subsection. I have, how ever, no hesitation in holding that the subsection contemplates the non‑fulfilment of a stipulation amounting to a condition at the time fixed for its fulfilment, be that time the one at which the property passed to the buyer or some subsequent time agreed upon by the parties. It was next urged by the learned counsel for the respondent that the respondent having, at the time of the sale, been given to understand that the car was a 1949 Plymouth car, it should be held that there was an implied term in the contract that if the respondent discovered that the car was not of the year of which it was represented to be, the respondent will have the right to repudiate the contract. I cannot accept this contention because if it were accepted, subsection (2) of section 13 of the Sale of Goods Act, 1930, will become a dead letter as it could be urged in every case of a breach of a condition that one of the implied terms of the contract was that non‑fulfilment of a condition would give the buyer the right to repudiate the contract even thought the property in the goods bad passed to the buyer either physically or impliedly because of the provisions of law. If the car had been bought for a specific purpose which could be fulfilled by a 1949 model of Plymouth car and not by one of the previous year it may perhaps have been possible to urge with success that the contract had in it an implied term that the buyer had, in spite of the car having passed into his possession, a right to repudiate the contract, but on the facts of the present case an implied right of repudiation cannot be inferred. In the view I have taken it is not necessary to consider the effect of the fact that before the institution of the suit the car was involved in two accidents and I will, therefore, say nothing on that aspect of the case. I cannot, however, held remarking that if it were necessary to give a definite finding whether: the stipulation that the car was of the year 1949 was a "condition" or a mere "warranty", the fact that the respondent did not move in the matter till after the car had been involved in one or two accidents would have been a strong circumstance in favour of the view that as between the parties the stipulation was not a "condition" but a mere "warranty." It was also contended by the learned counsel for the res pondent that as the car was represented to be of the year 1949, the contract was not of a sale of "specified goods" but one of sale of goods by description. In my opinion, this contention is not tenable in view of the definition of "specified goods" given in section 2, subsection (14) of the Sale of Goods Act, 1930. The words "agreed upon" occurring in that definition cannot be taken to mean that the goods conform to the description in all details because if that were their meaning there could be no breach of a "condition" or of a "warranty" in cases of sale of "specified goods" and the Sale of Goods Act would not have provided for cases of breaches of condition and warranty in regard to those goods, as it does. But even if I were to accept the contention that the case was of a sale of goods by description, I do not see how the position will alter because the contract not being severable and the buyer having accepted the goods, a breach of "condition" can be treated only as a breach of "warranty" and the buyer does not, after using the car; retain the right to reject it by treating the con tract as repudiated on the ground that the car given to him was manufactured in the year previous to the one in which it was represented to him to have been manufactured. The relief which the respondent seeks to obtain is precisely what subsection (2) of the 13th section of the Sale of Goods Act, 1930, appears to me to have been enacted to deprive a buyer of. To no kind of con tract does the doctrine of caveat emptor have greater application than to one of sale of goods governed by the Sale of Goods Act. 1930. The position will be the same, be the fact that the buyer got goods inferior to those he paid for due to his being unwary, careless or too trusting or to the seller not being an honest man. Where the delivery of goods has been taken, the position of the contracting parties is exactly the same, in contracts of sale of specified goods and sale of goods by description ; but where the ale is of "specified goods" the buyer cannot repudiate the contract once it has been completed in accordance with the provisions of the Sale of Goods Act, 1930. For the reasons stated above I have arrived at the conclusion that because of the provisions contained in subsection (2) of section 13 of the Sale of Goods Act, 1930, the respondent could not treat the non‑fulfilment of the stipulation about the car in dispute being of the year 1949 as anything but a breach of warranty. Section 12 of the Sale of Goods Act, 1930 provides that a breach of warranty does not entitle the buyer to repudiate the contract but entitles him only to claim damages. That being so, it follows that the respondent could not claim the right to repudiate the contract and the decree to that effect passed in his favour could not have been passed. During the course of arguments the learned counsel for the appellant urged that even if the view of the learned trial Judge that the respondent could rescind the contract was correct, his client should not have been ordered to refund the whole amount because the amount to which the appellant was entitled under section 64 of the Contract Act could and should have been assessed in the present suit. The argument is not without force and it is not without significance that the learned counsel for the respondent did not attempt to meet it. But as, in view of my findings, this aspect of the matter does not call for determination, I need not express a considered opinion about it. I now pass on to consider what order should be made. The relief claimed by him could not be granted to the respondent but he was certainly entitled to a different kind of relief. The learned counsel for the respondent applied orally for permission to amend the plaint in the event of its being held that the respondent was not entitled to the relief claimed by, and granted to him. The wide powers given to Courts by Order VI, rule 17 of the Code of Civil Procedure to allow amendment of pleadings can be exercised at any stage of the litigation and to my knowledge in one case amendment of pleadings was allowed when the matter was before the Judicial Committee of the Privy Council which was those days the ultimate Court of appeal with regard to cases from territories under the British Rule. It is, however, obvious that the power to allow amendment of pleadings is not to be exercised without consideration of all aspects of the matter. An appellate Court may allow amendment of the pleadings If the amendment will not result in the setting up of an entirely new case by the party asking for permission to amend and also in cases in which the amendment is necessitated by an entirely technical defect, for example, where a suit which should have been for possession was for a mere declaration of title. But where the amendment will result in the setting up of an entirely new case, the appellate Court cannot but be reluctant to show indulgence to a party which came to Court with a grossly exaggerated claim. In the present case the amendment sought to be made will result in a plaint which, as far as the salient aspects go, will have very little resemblance with the plaint sought to be amended because the respondent will have to claim damages, to mention what they amounted to and explain why he was entitled to them. Then the parties will have to lead, evidence all over again and that evidence, as far as I can see, will have to be much more elaborate than the evidence produced by the parties already, because the respondent will have to prove that he suffered damages by reason of the fact that the car supplied to him was of the year 1948 though represented to be that of the year 1949. In addition there is the consideration that if the respondent is allowed to amend the plaint and ultimately gets a decree with costs, he will probably be in no better position than if his present suit were dismissed and the parties left to bear their own costs, because It will be against all judicial principles to entirely deprive the appellant of costs incurred so far in spite of the success of this appeal and at the same time allow the respon dent to start the suit afresh. In view of what I have said above, I would accept the appeal, set aside the decree of the Court below and dismiss the suit, but would, because of the peculiar circumstances of the case some of which I have detailed in the preceding paragraph, leave the parties to bear their own costs throughout. KAYANI, J.

‑(14‑12‑1955).‑The car which the defendant sold to the plaintiff is now admitted by the former to be a 1948 model Plymouth, though he insisted, prior to the institution of the suit, that it was a 1949 model. See his letters Exhibits P. 2 and P. 1, dated 28th November and 17th December 1949 respectively. In the former he calls it a "1949 series car for all intents and purposes." In the written statement, he tried to explain a difficult position by stating that "for purposes of registration the car was declared a 1949 model, but this was done under advice from the principal agents * * * * .". This is wrong, because the head office at Bombay wrote to the plaintiff in a letter dated 1st December, 1949 (Exh. P. 5) that the car in question was a 1948 model, and the defendant has not produced any evidence that "the principal agent"‑whoever they were‑had advised him to the contrary. It is, therefore, a prevaricating written statement in which he seeks further refuge in the denial that the plaintiff had ever stipulated for a 1949 model or that the defendant had undertaken to supply such a model. The anxiety to assure the plaintiff, before the suit was brought, that it was a 1949 model (Exhs. P. 2 and P. 1 referred to above) makes it more or less certain that this was the model agreed upon. If this were not so, why does he say in the letter Exh. P. 1 : "I assure you that this is 1949 model car and there were no intention on my part to defraud you by any means" ? This means that the plaintiff had charged him with fraud for selling to him a 1948 model. It is, therefore, difficult to rely on his statement in Court, made as D. W. 6, that "the plaintiff did not ask me about the model of the car I had shown to him, when he first came to the show‑room," and that "he did not say that he wanted to purchase the latest model." But he admitted that if the plaintiff "had asked me that he wanted a new car, 1 would understand that he wanted the latest model." Did the plaintiff ask for an old car ? No, because in the sixth sentence of his examination‑in‑chief the defendant states that the plaintiff came to buy a new car. Next he admits that it was true that "the car which was shown to the plaintiff was held out by us to be a 1949 mod ". This means the plaintiff must have asked for a 1949 mode , or at least put a question inquiring what model it was. This falsifies the earlier position during examination‑in‑chief that "t re was no talk between us about the year of the model o the car". As an apology for making a false representation, lie explains : "Our principals do not supply us with information about the year of manufacture of the cars supplied to us * * * * but now I am in a position to say that it was manufactured in 1948". Compare this with para. 4 of the written statement that "for purposes of registration etc.," the car was declared a 1949 model under advice from the principal agents we have never heard, so far, that the year of manufacture for purposes of registration is different from the model year. The "etcetra" is in addition.

2. I have, therefore, no doubt that the defendant is guilty of fraud within the meaning of section 17 of the Contract Act. Fraud, under that section, means (among other things) "the suggestion as to a fact, of that which is not true by one who does not believe it to be true", with intent to deceive another party or to induce him to enter into the contract, and it would require an effort to believe, having in mind the shifting defences, and having in mind the natural presumption that should attach to the defendant's course of business, that he did not know what a 1949 model was. But even if he were ignorant, "the positive assertion of that which is not true, though he believed it to be true", in a manner not warranted by his information, would bring his conduct under the definition of misrepresentation in section 18.

3. Now if the case is governed by the Contract Act, section 19 of that Act would apply, and since the plaintiff's consent to the purchase of the car was obtained by fraud or misrepresentation", "the agreement is a contract voidable at the option of the party whose consent was so caused", that is to say, the plaintiff.

4. But my brother Shabir Ahmad says it is not governed by the Contract Act and that it is governed exclusively by the Sale of Goods Act, because under section 3 of the latter only those provi sions of the Contract Act are applicable which are not inconsistent with the express provisions of the Sale of Goods Act, and section 19 of the Contract Act, which provides for voidable con tracts, is inconsistent with section 13 of the Sale of Goods Act.

5. Now section 13 of the Sale of Goods Act merely says‑so far as relevant‑that where the contract is for specific goods the property in which has passed to the buyer, the breach of any condition to be fulfilled by the seller can only be treated as a breach of warranty and not as a ground for rejecting the goods and treating the contract as repudiated, unless there is a term of the contract, express or implied, to that effect. (For the difference between "condition" and "warranty", see section 13, reproduced in my brother's judgment). Now on the evidence it may be reasonably assumed that the plaintiff had told‑ the defendant that he wanted a 1949 model Plymouth, and if the vigorousness of his subsequent protest‑when he styled it a fraudulent transaction is to have full effect it should further be granted that he had asked for a 1949 model and no other. In other words, he made this an express term of the contract. If this were all, the case would be covered by one part or the other of section 13 of the Sale of Goods Act and if any provision of the Contract Act ran to the contrary, section 13 will over‑ride it. But if in addition to a breach of condition, there has occurred fraud also, and the Sale of Goods Act does not provides for fraud, I do not see how you can stop the operation of section 3 of the Sale of Goods Act, which applies the Contract Act to all contracts of the sale of goods, unless it is inconsistent with any provision of the Sale of Goods Act. That Act does not provide for fraudulent transactions because the Contract Act provides for them and even apart from that con sideration, it would be wrong to say that the non‑existence of any provision in the Sale of Goods Act amounts to an express incon sistency with the Contract Act. It would also be wrong to say that while fraud is a vitiating circumstance in all other transactions, it has no effect on the sale of "goods".

6. It is interesting to note that all the four illustrations to section 17 of the Contract Act (which defines fraud) relate to "goods" as defined in the Sale of Goods Act. "A sells by auction to B a horse which A knows to be unsound. * * * * B says to A. `If you do not deny it, I shall assume that the horse is sound'. `A says nothing. Here A's silence is equivalent to speech." That is to say, "active concealment". It may be argued that these illustrations were given when the provisions of the Sale of Goods Act were a part of the Contract Act. The answer is, firstly that these illustrations were not separated from section 17 even after the enactment of the Sale of Goods Act, and, secondly, that section 13 (2) of the Sale of Goods Act existed even then, in the form of section 117 of the Contract Act.

7. In England, it is "well‑settled" that buying with the intention of not paying the price "is a fraud which entitles the seller to rescind the contract". See Clough v. The London and North Western Railway Company ((1871) L R 7 Exchequer 26), where it was held that a successful plea might be taken even during the pendency of a suit, if fraud is discovered at that stag, that the goods were sold and delivered under a contract induced by fraud, if by then no interest has vested in any innocent person, rendering it inequitable or unjust to rescind the contract.

8. In Pollock and Mulla's Commentary on the Sale of Goods Act (2nd Edition) edited by Sir Brojendra Lal Mitter, the following note occurs under section 13, at page 61 : "Since the case of Street v. Blay ((1931) 36 Revised Reports 626), it has been treated as well‑settled in English law that the purchaser cannot avoid the sale of a specific chattel, except under an express condition in the contract, or for fraud, after the property has passed." A person who had purchased a horse warranted sound, sold it again and then repurchased it. It was then that he discovered that the horse was unsound when first sold. It was held that he could not require the original vendor to take it back, the property in the horse having passed to the vendee, "unless there has been a condition in the contract authoris ing the return, or the vendor has received back the chattel, or has been guilty of a fraud, which destroys the contract altogether". It is true that this case was decided long before the English Sale of Goods Act, 1893, came into force, but it was never contended that he English Act is anything but a codification of the common principles accepted in England for a long time.

9. It is clear from the editor's preface to the second edition that the Sale of Goods Act was framed by Sir Dinshaw Mulla and that the editor "was associated with Sir Dinshaw Mulla" in the framing thereof. Both Mulla and the editor should, there fore, have known whether and how far the English cases apply to our law. Incidentally, section 13 (2) of our Act corresponds to section 11 (1) (c) of the English Act.

10. Heilbuit v. Hickson ((1872) L R 7 C P 438), is another case in which fraud was excepted from the general rule that when property in goods has passed, the remedy lies in damages only.

11. Now look at the matter from another angle. According to section 4 of the Sale of Goods Act, "a contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price". The term contract has not been defined in this Act, but section 2 (15) says that expressions used but trot defined shall have the meanings assigned to them in the Contract Act. According to section 2 (h) of the latter Act, an agreement enforceable by law is a contract, and according to section 2 (i), it is a voidable contract if it is enforceable at the option of one party but not of the other. Then we come to section 10, which prescribes "free consent" as one of the pre‑requisites of a contract. Next, section 14 defines "free consent" as a thing which is not tainted with fraud, mis representation, undue influence or mistake of fact. Where, consequently, there is fraud, there is no free consent and no contract. Had it not been for the beneficient provisions of section 19, which gives the defrauded party the option of rescinding or pursuing the contract, it would be entirely void. For that reason, section 2 (i) coins a new expression, "voidable contract".

12. I wish also to point out that section 13 of the Sale of ,Goods Act must be deemed to be qualified by section 15, which says that if the sale is by description, there is an implied condition that the goods shall correspond to the description and that if the sale is by sample as well as by description, it is not sufficient that the bulk of the goods corresponds with the sample if they do not also correspond with the description. In .the examples given under this section, No. 4 (a) runs thus : "Sale of `new Singer Car'. On delivery the buyer finds that it is not a new car. The buyer may reject the car". The following note in the commentary may be referred to with advantage : "whether, there fore, the property in the goods passes to the purchaser or not, he is entitled to reject the goods if they are not in accordance with the description in the contract, provided that the description forms an actual part of the conditions of the contract and is not something collateral to it". I need not refer to the cases on which it is based.

13. Having come to the conclusion that the contract is voidable at the plaintiff's option, we have to notice the effect of rescission. It is, therefore, argued that, as required by section 64 of the Contract Act, "the party rescinding a voidable contract shall, if he have received any benefit thereunder, restore such benefit, so far as may be, to the person from whom it was received". The benefit received, according to this argument, is not only the car, but its use by the plaintiff even after the discovery of fraud. Now I do not understand how the use of the car is a benefit under the contract. What was received under the contract by one party was a car and by the other its price, and if the benefit in the defendant's case could obviously be no more than the price he received, logically enough, in the case of the plaintiff, it could be no more than the car itself. The defendant invested the money in further enterprises and may perhaps have doubled it in profit. The plaintiff has no share in those profits. The equivalent of those profits for the plaintiff is the use of the car. That is not a benefit received under the contract, because there was no stipulation that the plaintiff must use the car. It was argued that the plaintiff should have put the car in a garage after discovering the fraud and charged the defendant for the use of the garage. But what about the money which the defendant is using ? It is argued that he can claim interest at 3 per cent. (although the defendant may receive a return of 20 per cent., on his investment). But what about the use of the car of which the plaintiff will be deprived by garaging it ? I do not think it could be reasonably denied that he would be entitled to hire a car and charge the defendant. Even in 1942, if you let a second hand car to the Government, you received about Rs. 300 a month for it. The cost to the defendant would thus be more than the "benefit" he would receive in the form of compensation for deterioration, if at all he could receive it.

14. No case has been brought to my notice which may be said to be on all fours with the present, but the following cases give an idea of what was understood to be "benefit" under section 64 in various contexts. In Bechu v. Bhabhuti Prasad (I L R 52 All. 831), the guardian of a minor 'had mortgaged the minor's property for Rs. 1,400, and the mortgagee could effect repairs and erect new buildings, the cost to be charged to the minor on redemption. The total of these constructions was alleged to be Rs. 11,

621. When, subsequently, the mortgage was set aside at the minor's instance as a void transaction, the mortgagee claimed both these amounts with interest as "benefit" under section

64. This claim was rejected with the following remarks : "Benefit received under the voidable contract is what the party rescinding it actually received under the contract. The sum of Rs. 1,138 "(found to be a good debt of the minor)" may be considered to be such benefit. The plaintiff respondent cannot be said to have received any benefit with reference to the newly added buildings. In fact, the appellant now offers the benefit of improvements made by him, claiming from the plaintiff the cost of such improvements".

15. The following observations made in Muralidhar Chatterjee v. International Film Company (70 I A 35) are instructive: "Sections 64 and 65 do not refer by the words `benefit' and `advantage' to any question of `profit' or `clear profit', nor does it matter what the party receiving money may have done with it".

16. In Chinna Swami Reddi v. Krishna Swami Reddi (48 I C 856) a minor's properties were sold by his guardian, who purchased other properties with the sale money, though on the facts it was found that the purchase of other properties was not a part of the original transaction. On the suit of the purchaser for possession of the properties, it was held that the contract was not binding on the minor and that the purchaser was entitled only to the restoration of the consideration paid by him, not to the properties purchased for the minor with that money. "Ordinarily, the benefit which a party receives when he sells the property is the price which the vendee pays. Any profits which the vendor might make with the moneys would be too remote in estimating what he has to return in case he is entitled to avoid the sale and elects to do so".

17. I am strongly of the view that the benefit which the person rescinding a voidable contract receives has, in the first place, reference to the immediate benefit and not to how he exploits this benefit ; and that, in the second place, what he has given to the other party in consideration of the benefit must be set off against the benefit before any question of restoration arises.

18. On this view, the appeal should be dismissed with costs. ORDER OF REFERENCE KAYANI AND SHABIR AHMAD, JJ.

‑(14‑12‑1955).‑As we are not agreed with regard to the application of section 13 (2) of the Sale of Goods Act, 1930, to the facts of the. present case, the papers will be laid before Hon'ble the Chief Justice to "nominate a Judge or Judges for decision on that point. Mahmud Ali and Rafiq Ahmad for Appellant. Sh. Bashir Ahmad and Amin Ahmad for Respondent. Dates of hearing.‑: 16th, 17th and 20th February 1956. JUDGMENT OPINION OF RAHMAN, C. J. RAHMAN, C. J --‑(28‑3‑1956).‑This case has been put up before me under clause 26 of the Letters Patent on a difference of opinion arising between Kayarli and Shabir Ahmad, JJ., on the question of the application of section 13 of the Sale of Goods Act, 1930, to the facts of the case. The question has arisen in the following circumstances. Mr. Tasdiq Hussain, plaintiff‑respondent, purchased a new Plymouth car from the Eastern Automobiles Limited, The Mall, Lahore, (the defendants‑appellants) in June 1949. He paid Rs. 15,100, inclusive of sales tax, insurance charges, road tax, etc. The respondent used this car after delivery and had three minor accidents with it. Sometime in October 1949, he discovered that the car supplied to him was not the 1949 Plymouth model. He made enquiries from the defendants‑appellants who assured him that it was a 1949 model car. He pursued his enquiries further afield and satisfied himself that the car in question was a 1948 model. On the 25th of April 1950, he brought a suit for recovery of Rs. 15,10) from the defendants‑appellants claiming to be entitled to rescind the contract. The suit was resisted, inter alia, on the ground that the plaintiff never stipulated for a 1949 model and that there was no undertaking to supply him such a model. It was pleaded that the plaintiff had seen a car standing in the show room of the defendants and had agreed to a similar car out of consignment of four, which was due to arrive later. The trial Court held that there was a definite stipulation that the car would be of the 1949 model, that there was fraudulent misrepresentation on the part of the defendants‑appellants and that, consequently, the plaintiff‑respondent was entitled to the return of the price paid by him, on surrender of the car. A decree was, therefore, passed in his favour on the 31st of July 1951. Till then, the car was in the plaintiff's use as the defendants had refused to take back the car on his demand and he had given them a notice that he would continue to use the car at the defendants' risk. Aggrieved by this decision, the defendants came up in appeal to this Court. The appeal was heard by Kayani and Shabir Ahmad, JJ. It may be mentioned that in execution proceedings, by order of Shabir Ahmad, J., the present value of the car was assessed at Rs. 7,000 in December 1951 and execution was stayed with the consent of the parties, on the understanding that the respondent would retain the car at a valuation of Rs. 7,000 and a cheque for Rs, 8,085 was handed over to him by the defendants appellants for the remainder of the price paid. In effect, there fore, the respondent has got a new Plymouth 1948 car for Rs. 7,000, whereas its price, according to the evidence on record, does not appear to have been less than that for 1949 Plymouth. While making the reference under clause 26 of the Letters. Patent, the learned Judges who heard the appeal, have recorded the following note :‑ "As we are not agreed with regard to the application of section 13 (2) of the Sale of Goods Act, 1930, to the facts of the present case, the papers will be laid before the Hon'ble the Chief Justice to nominate a Judge or Judges for decision on that point". It seems necessary, therefore, to set out briefly the findings given by the two learned Judges. Both of them have agreed that there was a definite stipulation by the plaintiff that the car to be purchased by him would be of the 1949 model and this, therefore, constituted a condition of the contract. Shabir Ahmad, J., thought that the present case was one of misrepresentation or possibly of fraud and, therefore, ordinarily, the contract would have been voidable at the instance of the plaintiff under section 19 of the Contract Act. In his opinion, the sale was of "specific goods" within the meaning of section 20 of the Sale of Goods Act and, assuming that the stipulation regarding the model year was intended as a condition and not as a warranty, its breach would not entitle the plaintiff‑respondent to repudiate the contract in the circumstances of this case. The property in the car had passed to the plaintiff‑respondent by delivery and, therefore, the condition could only be treated as a warranty by virtue of subsection (2) of section 13 of the Sale of Goods Act. He did not accept that there was any implied condition that the car would be returned if not of the stipulated model, as, according to him, this would nullify the provisions .of section 13 (2) referred to above. He was further of the view that even if the sale could be said to be one by description, the position would not be different, the contract not being severable and the property in the goods having passed to the buyer. Kayani, J. found that the defendants‑appellant had been definitely guilty of fraud as they had misrepresented the car sold to be of 1949 model. In his view, this was not a case of breach of condition simpliciter, but as fraud was superadded and the Sale of Goods Act did not contain any provision in conflict with the provisions of section 19 of the Contract Act, therefore, section 13 (2) of the Sale of Goods Act could not be pressed into service to defeat the right of rescission of contract inherent in the plaintiff. He pointed out that if a contract was vitiated by fraud, there could be said to have been no "free consent" and, con sequently, no real contract between the parties. He considered that in these circumstances the plaintiff was entitled to a refund of the full price of the car paid, on surrender of the car and that the benefit derived by the plaintiff by use of the car, could be set off against the use of the plaintiff's money by the defendants. The first question that falls for determination is whether this was a case of a fraudulent or an innocent misrepresentation. After going through the evidence on record with the help of learned counsel for the parties, Tam inclined to agree with Kayani, J., that this was a case of "fraud" within the meaning of section 17 of the Contract Act. This section defines "fraud" in the following terms :‑ " `Fraud' means and includes any of the following acts committed by a party to a contract, or with his connivance, or by his agent, with intent to deceive another party thereto or his agent, or to induce him to enter into the contract :‑ (1) the suggestion, as a fact, of that which is not true, by one who does not believe it to be true ; (2) the active concealment of a fact by one having knowledge or belief of the fact ; (3) a promise made without any intention of performing it ; (4) any other act fitted to deceive ; (5) any such act or omission as the law specially declares to be fraudulent". Then follows an explanation which is not material to the facts of this case. Even if the defendants had no intention of deceiving the plaintiff by the representation, in my opinion, the representa tion in question about the car being 1949 model, was intended to induce the plaintiff to enter into the contract. Although in the written statement submitted by the defendants in the trial Court, the position was taken up that there was no stipulation either about the model year of the car or no representation that the car in question was of the 1949 model, yet from the evidence of D. W. 4, J. W. Marks, a salesman of the defendants, it is clear that the car was in fact represented to be of the 1949 model. Even Mr. Hoshang Kandawala, the managing proprietor of the defendants as D. W. 6, admitted in his statement that if the plaintiff had mentioned that he wanted a new car, he would have understood him to refer to the latest model and that it was true that the car which was shown to the plaintiff in April or May 1949 was represented by the firm to be a 1949 model. The plaintiff has stated on oath that he would not have purchased the car which was delivered to him in June 1949 but for the assurance that the car which he had seen previously in the show‑room as a specimen car, was a 1949 model. Even when the plaintiff expressed doubts in October 1949 about the model of the car, the defendants per sisted in asserting that the model year of the car was 1949. When actually purchased, the car had been described in the relevant papers concerning insurance and road certificates, as a 1949 model. On a consideration of the whole evidence on record, I am satisfied that the term of the model year of the car was an essential term of the contract so as to amount to a condition and that the plain tiff would not have entered into the bargain but for the assurance given to him on this point. The stipulation about the model year was, in my opinion, a condition and not a mere warranty within the meaning of section 12 of the Sale of Goods Act. In the defendant's evidence, it was suggested that as the car in question had been manufactured late in 1948 and was being sold about the middle of 1949, it could have been reasonably described as a 1949 model car. Mr. Hoshang Kandawala tried to give the impression that their principals did not supply them with information about the year of manufacture of the car. He admitted that he was now in a position to state that the car was manufactured in 1948. It appears from the evidence that the Ply mouth Manufacturers had adopted the code series P‑15 for models up to 1948 and the 1949 model was designated by the series P‑

18. The defendants‑appellants have been in the motor trade for a long time and it is difficult to believe that they either did not know the year of manufacture of the car sold or that they really believed the car to be of the 1949 model. Clause (1) of section 17 of the Contract Act, therefore, apparently covers this case as the defend ants had suggested that the car was of 1949 model, which fact was not true, or alternatively, which the defendants did not believe to be true. I am quite conscious of the consideration that there was a scarcity of new cars in the market and, therefore, the defendants could have sold this particular car easily to other customers. At the same time, they may have been anxious to secure this particular customer and to sell off this car before the 1949 model arrived in the market. The resale value of a car would also depend on its model year and that would be a consideration present to the mind of the buyer. Although, therefore, the defend ants may not have been guilty of fraud on the moral plane, yet it seems to me that the definition of fraud given in section 17 clause (1) of the Contract Act is satisfied in the present case. Even if it would be argued that this was not a case of fraud, it was certainly one of misrepresentation within the meaning of that term as defined by section 18 of the Contract Act. Under that section, misrepresentation means and includes, inter alia, the positive assertion, in a manner not warranted by the information of the person making it, of that which is not true, though he believes it to be true, and causing, however, innocently, a party to as agreement to make a mistake as to the substance of the thing which is the subject of the agreement. Whether, therefore, it was a case of fraud or of misrepresentation, it is clear that the contract would have been voidable under section 19 of the Contract Act at the option of the party whose consent was obtained by fraud or misrepresentation. But for this section 19, it may have been possible to argue that in such cases no real contract results. Section 10 of the Contract Act declares all agreements to be contracts if they are made by the "free consent" of parties com petent to contract, for a lawful consideration and with a lawful object, and which are not expressly declared to be void under the Act. By section 14 of that Act, consent is said to be free when it is not caused by coercion, undue influence, fraud, misrepresen tation or mutual mistake. If any of these elements is present, it could not be "free consent" and, consequently, the agreement would not become a contract within the meaning of section

10. Section 19, however, declares such agreements to be contracts voidable at the instance of the party whose consent is so caused. The next question that calls for consideration is as to the effect of section 13 of the Sale of Goods Act, 1930, on this transaction. Subsection (1) of this section gives an option to the buyer, in case of breach of a condition of the contract, to waive the condi tion or elect to treat the breach as a breach of warranty and not as a ground for treating the contract as repudiated. The material part of the section which concerns us in the present case, however, is subsection (2) which may be reproduced :‑ "Where a contract of sale is not severable and the buyer has accepted the goods or part .thereof, or where the contract is for specific goods the property in which has passed to the buyer, the breach of any condition to be fulfilled by the seller can only be treated as a breach of warranty and not as a ground for rejecting the goods and treating the contract as repudiated, unless there is a term of the contract, express or implied, to that effect". \ When the plaintiff first saw the car in the show‑room of defend ants and agreed that he would buy a similar car out of the next consignment of four cars promised by the defendants in April or May 1949, he entered into an "agreement to sell" within the meaning of subsection (3) of section 4 of the Sale of Goods Act. When he actually took delivery of the car from the defendants' premises in June 1949 on the understanding that it corresponded to the car he had already seen and with the description that it was a 1949 model, the agreement became a "contract of sale". This was a sale of "specific goods" as defined in item (14) of section 2 of the Act as the goods were identified and agreed upon at the time the contract of sale was made. There was, undoubtedly, a breach of the condition about the model year of the car in this case. Could it then be said that subsection (2) of section 13 debars the plaintiff from using the condition to repudiate the contract and compels him to treat it as a mere warranty, entitling him to compensation ? The answer to the question probably turns on the interpretation of the words "the property in which has passed to the buyer". This was apparently a case of sale of specific goods by description and, consequently, there was an implied condition that the goods shall correspond with the descrip tion as provided by section 15 of the Sale of Goods Act. Under section 20 of the Act, it is prescribed that where there is an uncon ditional contract for the sale of specific goods in a deliverable state, the property in the goods passes to the buyer when the contract is made, but the present was not an unconditional contract in that sense. The rules bearing on the question as to when property in goods sold, passes to the buyer, embodied in the Sale of Goods Act, are really prima facie rules of construction, in order to determine the real intention of the parties, within the meaning of section 19 of the Act. When there is a condition precedent to '.the passing of the property, whether express, or implied, the property does not really pass to the buyer till the condition is fulfilled. Section 13 subsection (2), it is to be noted, does not use the expression "has accepted the goods" where the contract is for specific goods, but, on the contrary, it uses the expression "the property in which has passed to the buyer". There may be acceptance of goods within the meaning of section 42 of the Act when the goods have been delivered to the buyer and he does any act in relation thereto, which is inconsistent with the owner ship of the seller, or when, after the lapse of a reasonable time, he retains the goods without intimating to the seller that he has rejected them. Here, after delivery, the plaintiff certainly used the car in the ostensible right of ownership and, therefore, he may be deemed to have "accepted the goods" within the mean ing of the first part of subsection (2) of section

13. But I am inclined to doubt whether in the absence of the fulfilment of an essential condition of the contract, it could be said that the property had really passed to the buyer, within the meaning of the second part of that subsection. Be that as it may, the real question is whether the provisions of this subsection are in conflict with those of section 19 of the Contract Act, so as to deprive the plaintiff of his right of rescission of the contract, even for fraud or misrepresentation. Section 3 of the Sale of Goods Act declares that the unrepeal ed provisions of the Indian Contract Act, 1872, save in so far as they are inconsistent with the express provisions of this Act, shall continue to apply to contracts for the sale of goods. Unless, therefore, it can be found that the provisions of section 13 of the Sale of Goods Act cannot stand, side by side with section 19 of the Contract Act, the right of repudiation of the contract in the present case would not be taken away from the plaintiff. This is one of the essential points in the case on which the two learned Judges have differed. As has been pointed out in the commentary under section 13 of the Sale of Goods Act by Sir Brojendra Lal Mitter, the language of the second clause of subsection (2) of section 13 is not quite happy, and logically comes very near to being a contradiction in terms, for if the property passes despite the non‑fulfilment of the essential stipulation, such a stipulation is not a condition at all, whereas if it is a condition, the property does not pass if it is not fulfilled, unless the buyer waives its performance by accepting the goods or otherwise. The learned commentator takes note of the suggestion that the section has in view cases where the property passes by the buyer's subsequent acceptance of the goods, but objects that, in the first place, the subsection contains no such limitation and, in the second, that there would appear to be no reason for dealing thus specially with specific goods, as the result of the buyer's acceptance is sufficiently dealt with by subsection (1) and the remaining words of subsection (2). Ameer Ali J., of the Calcutta High Court, in Lalchand v. Baijnath (I L R (1936) 63 Cal. 736), took the view that this subsection applies to cases of "bargain and sale" when property in the specific chattels has passed. The subsection corres ponds to clause (1) (c) of section 11 of the English Sale of Goods Act, 1893 and substantially reproduces its provisions. The diffi culties of that clause are dealt with by Benjamin on Sale, Eighth Edition, at page

562. The learned author points out that under common law, a contract, of sale of specific goods was ordinarily a "bargain and sale" and that clause (c) was evidently intended to refer to such cases. The learned author thought that the case contemplated by the clause is one where the property passes by the buyer's subsequent acceptance of the goods, by a waiver of the right of rejection, but he also reaches the conclusion that the logical arrangement of section 11 is hereby destroyed, for the suggested waiver is a voluntary one‑a case already dealt with by clause (a)‑whereas clause (c) only deals with compulsory waiver. Even if this view is accepted as correct, I should be reluctant to hold that there had been a voluntary or conscious acceptance of goods in the present case, with waiver of the condition. There is no provision in the Sale of Goods Act 1930, bearing on the effect of fraud, misrepresentation, coercion and undue influence, on a contract of sale. I would be, therefore, disposed to hold that the relevant provisions of the Contract Act on these questions continue to be applicable to contracts of sales despite the provisions of section 13 of the Sale of Goods Act. This section also does not contain any reference to cases of fraud etc., and apparently contemplates such cases as involves a breach of a1C condition, without fraud, misrepresentation and the like affecting C the formation of the contract itself, at its inception. If thus interpreted, there would be no difficulty in holding that section 19 of the Contract Act can stand with section 13 of the Sale of Goods Act, 1930. The result would be that in cases of fraud and misrepresentation etc., vitiating the contract unless there was a waiver on the part of the party affected, the right of rescission would not be lost. Except for certain differences which do not appear to be material in the present case, our Sale of Goods Act is almost in pari materia with the corresponding English Act. It would, therefore, be profitable to ascertain the position obtaining under English law on the point involved in the present case. I find the following instructive passage in Benjamin on Sale, Eighth Edition, at page 427:‑ "There is a settled doctrine of equity applicable, at least to misrepresentation on the sale of land, and interests therein., that a contract cannot be rescinded where it has been executed on both sides, so that the parties cannot be restored to their original position, in the absence of fraud, or essential mistake, or fiduciary relationship between the parties. This doctrine has been extended to leases by deed and sales of shares. But no case has been found in which this doctrine has been applied to a sale of goods and it seems wholly inapplicable to it. Moreover, it the true view of the effect of innocent mis representation be that, to be effectual, it must produce essential mistake, contracts of sale of goods are within the exception to the rule. The question seems now to have been authoritatively decided in accordance with this view as in Bell and another v. Lever Brothers Ltd. and others 1932 A C 161, the House of Lords accepted and applied the judgment of. Blackburn, J., in Kennedy's ease that a misrepresentation, to justify rescission, must go to the root of the matter; it must be fundamental and not merely material." The learned author goes on to say that repudiation of a contract on the ground of misrepresentation is only competent to the party misled where restitute in integrum is possible, that is, where the parties can be restored to their original position as before the contract, for it is a general rule that where a contract is to be rescinded at all it must be rescinded in toto, and the parties put in statu quo. Thus, anything received under the contract must be returned or tendered to the other party. But the rule must not be taken too literally, and as imposing an absolute obligation in all events to restore the other party to his original position. The status quo ante may have been changed or modified, either by some cause for which the party seeking relief is not responsible, or by the legitimate exercise of the rights given him by the contract, as by reasonable, but not excessive, trial of the goods to see whether they are in accordance with the contract. But delay for an unreasonable time precludes rescission. In Kerr on the Law of Fraud and Mistake, 1952 Edition, at page 532, the following passage occurs: "It is undoubted law that when a vendor has procured the sale of his property by misrepresentation, the purchaser can set aside the contract prior to completion, even though the misrepresentation be innocent. But there is authority that if the contract has been executed by the completion of a con veyance or lease or the formal assignment of chattel, then rescission cannot be obtained on the ground of innocent misrepresentation by the vendor, lesser or assignor, and that when the contract is so completed, fraud must be proved before rescission can be granted. But, as will be seen, this authority cannot now be regarded as conclusive. Moreover, where there is a fiduciary relation between the parties, as far instance between principal and agent, the transaction will be set aside though fully executed." The learned author then refers to the distinction drawn in certain cases between contracts rescinded on account of fraud and those sought .to be rescinded on the ground of innocent misrepresen tation. Reliance is placed on the opinion of Blackburn, J. in Kennedy v. Panama etc., Co., (1867 L R 2 Q B 580) for the proposition that where there has been an innocent misrepresentation or mistake, it does not authorise a rescission unless it is such as to show a complete difference in substance between what was supposed to be and what was taken, so as to constitute a failure of consideration. However, though this statement was quoted with a approval by Lord Atkin in Bell v. Lever Bros. ((1932) A C 161) a case dealing primarily with mistake, yet in that very case in the Court of Appeal (who were reversed), Scrutton, L. J. declared that since the Judicature Act, 1873. Kennedy v. Prama Mail Company, so far as it decided that innocent misrepresentation, though material, is no ground for rescission unless it is also fundamental, is not now law. It is pointed out by the learned author that Lord Atkin himself delivering the opinion of the Privy Council in 1934 (after Bell v. Lever Bros.) granted rescission for a material but not fundamental innocent misrepresentation, drawing a distinction apparently between the position at law and in equity in the case of Mackenzie v. Royal Bank of Canada (1934 A C 475).' At page 535 the learned author doubts the correctness of the proposition that an executed contract cannot be rescinded for innocent misrepresenta tion, despite some recent authorities in support of it. In Chetty on Contracts, Twentieth Edition, at page 554, it is stated that rescission may be refused if the position of the parties has been so changed that restitution is impossible. After citation of certain authorities, reference is made to Armstrong v. Jackson ((1917) 2 K B 822), in which McCardie, J., held that the sale of a broker's own property to a client, in purported execution of a mandate to buy, might be rescinded, even though the value of the thing sold had deteriorated between the date of the sale and the action for rescission. That was, of course, a case where the parties were in a fiduciary position and the rule that restoration could not be granted if it would not be fair' could not be pressed into service in such a case. McCardie, J., while discussing the question of delay in rescission, laid down the dictum that delay in this context refers to such delay as occurs after the plaintiff has ascertained his right to rescind and whereby the position of the defendant is substantially altered and prejudiced. The learned author, however, doubted the correctness of this dictum, with the limitation pointed out by McCardie, J. He adds, at the same time, that in many cases absolute and complete restoration would not be possible and that if rescission is granted, it would be sufficient if practical justice is done as far as possible. Restitution, therefore, does not imply complete pecuniary compensation. It is further pointed out that in the case of fraud, the remedies of a claim for damages and of rescission are not alternative but cumulative. Again, at page 556 of the book, the learned author expresses himself in these terms :‑ "An executed conveyance may be set aside for fraud but not for innocent misrepresentation . . . . , . . An executed conveyance, though incapable of being invalidated by innocent misrepresentation, may of course be set aside for some other good reason, even falling short of fraud, as for instance, a breach of trust or other fiduciary relation between, the parties:" The learned author goes on to say that if an essential conditi9n of a contract was not fulfilled, the contract was invalidated, quite , regardless .as to whether the condition was an inducing cause or not, and that if this equitable rule had been applied to the facts of the case in Kennedy v. Panama Mail Company the result might have been different. In Salmond and Williams on Contracts, Second Edition, at page 547, there is a note concerning the effect of section 11 (I) (c) of the `English Sale of Goods Act, 1893. The learned Editor of that book has opined that the exact effect of this provision is somewhat obscure. He then quotes the opinion of Sir John Salmond in Taylor v. Combined Buyers Ltd. (1924 N Z L R 627) (a New Zealand case) to the following effect :‑ "I conclude therefore, that on the sale of a specific article, the buyer is entitled to reject the article for any breach of the implied condition of conformity with the description, fitness for the purpose, or merchantable quality, notwithstanding the circumstance that but for the breach of that condition, the property in the article would have already passed to the buyer. If this is so, the reference in section 13 (section 11 of the English Act) to the passing of the property as excluding the right of rejection must be read as limited to cases in which the property has passed to the buyer notwithstanding the breach of condition, in consequence of waiver, or acceptance, or otherwise ex post facto." It may now be instructive to refer to certain cases under the Chalmers Sale of Goods Act, 1893. It may be mentioned that most of the British Dominions have adopted the Act. This information is given in Appendix IV to Benjamin on Sale, In a British Columbia case Wisbe v. Butchart's Motors Ltd. ((1949) 4 D L R 838), the facts were that the plaintiff purchased a used car, from the defendant, on the latter's representation that the car was new. Soon after discovering that the car was a used one, the plaintiff rescinded the contract and later brought an action for rescission and damages. He continued to use the car up to the date of the trial. It was held by a majority of the Judges, who heard the case, that rescission would lie on the condition that the plaintiff returned the car and received back the purchase‑price minus an allowance for deterioration. O'Halloran, J. A. held that in that case there was failure of consideration for which the equitable remedy of rescission would lie. The learned Judge added that such remedy must also be had for innocent misrepresentation vital to the promotion of the contract. In the words of the learned Judge: "How can a contract be `executed' when the buyer has received something different in substance from that which he agree to buy ?" Robertson J. A. found that there was fraudulent mis representation entitling the plaintiff to rescission, on making restitutio in integrum. Sidney Smith J. A., however, was of the opinion that the plaintiff had by his actions, elected to affirm the contract and that no action would lie for damages, for deceit or breach of warranty, since damage was neither alleged nor proved. He also found against deceit in that case and pointed out that the newness of a car was a relative term. The learned Judge thought that on the evidence, no damage had been suffered by the plaintiff in that case. The next case that may be noticed in Edler v. Auerbech (L R (1950) 1 K B 359): That was a case of an executed lease and it was held that rescission could be granted for fraud but not for innocent misrepresentation The distinction against innocent misrepresentation was based on the dictum in Angle v. Jay ((1911) 1 K B 666). In Leaf v. International Galleries (L R (1950) 11 K B 86) the facts were interesting. In 1944, the defendants sold to the plaintiff for 85; a picture which they represented to have been painted by J, Constable. In 1949, the plaintiff tried to self that picture at Christies' and was then informed that it had not been painted by Constable. He took it to the defendants who retained it for investigation. They still maintained that it was Con table's work. The plaintiff then brought an action for rescission and repayment of the price. The county court judge held that there was an innocent mis representation and that the picture was not by Constable. Rescission was, however, denied as the contract had been executed. On appeal it was held, on the assumption that the remedy of rescission was open, that it could not be granted on the facts of that case as the right had not been exercised within a reasonable time. Evershed M. R. and Jenkins, L. J., pronounced the view that where a statement of the seller amounts to a warranty, for the breach of which remedy of damages was available, it was doubtful whether the equitable remedy of rescission for innocent mis representation ought to be granted at all. Denning, L. J., ruled, assuming that the statement was a condition, that the buyer had lost his right to reject and was relegated to his right to claim damages for breach. He observed that if rescission on the ground of breach of condition was barred, a fortiori it was barred on the ground of innocent misrepresentation. The same learned Judge, however, at page 90 of the published report, expressed himself as follows :‑ "I agree that on a contract for the sale of goods; an innocent material misrepresentation may, in a proper case, be a ground for rescission even after the contract has been executed. The observations of Joyce, J., in Seddan v. North Eastern Salt Co. Ltd., are, in my opinion, not good law." The learned Judge then referred to certain authorities in support of his view‑--viz., T. 8c J. Harrison v. Knowles and Foster ((1918) I K B 608), L'Esirange v. F. Graucob Ltd., ((1934) 2 K B 394) and Bell v. Lever Bros. Ltd., (L R (1932) A C 161) per Lord Atkin id the House of Lords Jenkins, L. J., delivered himself as follows in the same case :‑ "In some of the cases, on the strength of the authorities concerning sales of land, the proposition has been stated in general terms to the effect that no executed contract can after completion be rescinded on the ground of innocent misrepresentation. As appears from the recent decision of the majority of this Court in Solle v. Butcher ((1950) 1 K B 671), it seems probable that the pro position thus generally stated is unduly wide. In particular, it cannot be assumed that it necessarily holds good with respect to a sale of chattels passing by delivery." It appears, therefore, that the case reported was decided on its own peculiar facts and the proposition was affirmed that in the case of a sale of chattles passing by delivery, the contract can be rescinded in a proper case. Some authorities, which apparently take the contrary view, may also receive attention. One of them is Steedman v. Frigidaire Corporation (1932 W N 248 (P C)), a case from Canada. Rescission was denied in that case as restitution was not possible in full. There was an action by the respondents to recover under a contract, in pursuance of which they had supplied a refrigerating plant to the appellant, for a market hall. By amendment of his plaint at the trial, in consequence of evidence elicited during the case, the appellant claimed rescission of the contract upon the ground that the respondents' had promised a secret commission to the appellant's servant, who negotiated the contract on his behalf. The trial Judge rescinded the contract on that ground. The Appellate Division held that rescission could not be granted as the appellant by operating the plant had made it impossible to reinstate the parties and that the respondents were entitled to recover under the contract the sum claimed less such damages as the appellant might prove he had suffered by reason of the promised payment to his servant. The Privy Council affirmed the judgment in so far as it refused rescission but varied it in other respects. The only ground given was that restitutio in integrum could not take place. In Seddon v. The North Eastern Salt Company Limited ((1905) 1 Chancery 326) it was held that the Court will not grant rescission of an executed contract for the sale of a chattel or chose in action on the ground of an innocent misrepresentation. It was added that for the plaintiff to succeed in such a case he must prove fraud. As observed above, this authority was adversely. Commented upon in Leaf v. International Galleries per Denning, L. J. In Wallis, Son & Wells v. Pratt & Haynes (L R 1911 H L 394) the respondents had sold to the appellants as common English sainfoin, certain seed, and there was a clause in the agreement to the effect that sellers gave no warranty expressed or implied as to growth, disruption or other matters. The seed delivered was not common English sainfoin liut giant sainfoin, a different and inferior seed. The appellants sold it to other parties to whom the appellants were obliged to pay damages for the mistake. It was held that the appellants were entitled to remedies applicable to a breach of warranty and to recover from the respondents damages which they were obliged to pay to other parties. It is obvious that in that case restitutio in integrum was not possible and the case was one of honest mistake. The provisions of sections 11 and 53 of the English Sale of Goods Act were referred to. On a review of the opinions of tax‑book writers and the above authorities, the inference emerges that the proposition has never been doubted under the English Law that fraud could be availed of for rescission of a contract, though executed, but that in certain cases of innocent misrepresentation, the Courts have been chary of granting that relief. In this connection, it may be of interest to refer to a learned article by Mr. H. A. Hammelmann in the Law Quarterly Review, Volume 55, 1939, at page 90, entitled Seddon v. North Eastern Salt Co. This article reviews the case law on the subject of rescission for innocent misrepresenta tion in the case of executed contracts. The learned author has drawn the conclusion that it had never been suggested that an executed contract for the sale of goods could not be rescinded on the ground of innocent misrepresentation. I have not come across a single case in which, despite the provisions of section I I of the English Sale of Goods Act, which correspond to those of section 13 of our Act, the fact that the contract of sale had been executed was allowed to stand in the way of deluded. party rescinding the contract. The conclusion, therefore, which I. have reached is that, the provisions of subsection (2) of section 13 of the Sale of Goods Act, 1930, are not in conflict with the provisions of the Contract Act contained in section 19 of that Act, and, therefore, the remedy of rescission was open to the plaintiff in the present case on the condition that restitutio in integrum took place in the just manner. In my opinion, in the present case, there ought to be an allowance made for deterioration of the car by use on the part of the plaintiff though perhaps the benefit of user as such could be set off against the retention of the plaintiff's money by the defendants. However, I do not wish to express any final opinion on this aspect of the case which would no doubt come in for due consideration by the Division Bench. I would, there fore, answer the reference in the sense indicated above. The costs incurred by the parties before me would be costs in the cause. Mahmud Ali for Appellant. A. R. Sheikh, with Dr. Tasadque Husain for Respondent. Date of hearing :'20th April‑1959. KAYANI, C. J.--‑The former Chief Justice who heard this case on a difference of Japinion between us has held that the plaintiff could rescind the contract as there was a breach of condition. What we have now to determine is whether the plaintiff has received any benefit under the contract which he should restore to the defendant, under section 64, Contract Act, and the extent of that benefit. On this point, I have already given my views in para. 13 of my previous judgment. I have held that the plaintiff has not received any benefit under the contract. What was received under the contract was a car by the plaintiff and its money equivalent o by the defendant, and the benefit received from the use of the car is no more a benefit under the contract than the benefit received by the defendant from the use of the money. If the plaintiff had not used the car at all, but garaged it for the defendant's benefit, then so long as the price of the car was not refunded to him, he would be deprived of the use of ‑a car by reason of the defendant's failure to provide him with the car contracted for, and he would be entitled to hire a car at the defendant's cost. Even if the hiring cost him Rs. 300 a month, it would amount to Rs. 9,000 in thirty months. Instead of hiring a car, he used the defendant's car. If, therefore, the defendant were to be entitled to compensa tion for this "benefit", he would receive it subject to a payment by him of Rs. 9,000 to the plaintiff. In actual fact he has paid Rs. 8,

100. That being the balance of the price after deducting Rs. 7,000 for which the plaintiff is retaining the car as a second hand Vehicle. In addition, the plaintiff is not receiving any return for his money having remained locked‑up. On the whole, therefore, the defendant is not losing if the plaintiff pays him nothing for the use of the car. The observation in the judgment of the former Chief Justice that the plaintiff is getting a new Plymouth 1948 model for Rs. 7,000 does attract sympathy, but it loses sight of the true benefit which the defendant receives from the money and of which the plaintiff is deprived for not getting a 1949. model, and we have decided the case on the ground that the plaintiff was, on his contract, entitled to a 1949 model. The ostensible loss to the defendant is not a loss according to law and is only the measure of damages which he should incur in a fraudulent deal. The appeal should, therefore, be dismissed with costs. SHABIR AHMAD, J.‑‑Its is inequitable that the respondent should get a brand new 1948 model Plymouth car for Rs. 7,000 and I would have preferred to give a finding that the respondent get interest on his money at the highest rate permissible under the law but pay for the deterioration in the condition of the car resultant on his use of it, but that would be travelling outside the limits fixed by section 64 of the Contract, Act which comes into play when a voidable contract is rescinded by the party entitled to rescind it. I would, therefore, agree that the appeal be dismissed with costs. A. H. Appeal dismissed.