1992 PLP 783 (SCMR)

SALEEM AKHTAR, J.‑‑‑ The appellant has challenged the judgment passed by a Division Bench of the High Court of Sindh in H.CA. No.55 of 1979 filed by the respondent No.1 whereby the judgment of the learned Single Judge was set aside and the suit filed by the respondent No.1 for recovery of Rs.14,64,569.10 was decreed.

2. Briefly the facts are that in the year 1968 the respondent No.1 after obtaining import licence for the import of sugar worth Rs.76,77,002 placed order with foreign suppliers for import of 27848 tons of white crystal sugar. Respondent No.1 claims to have purchased Bonus Vouchers of the total value of Rs.1,30,36,833 and opened Letters of Credit in favour of the supplier. The entire quantity were shipped in six consignments in different vessels scheduled to reach Karachi Port on different dates. Before the consignments arrived at Karachi the Government of Pakistan, Ministry of Agriculture and Works (Food and Agriculture Division) issued Notification NO.S.R.0.185(R)/68 dated 17th October, 1968, whereby in exercise of the powers conferred under section 3 of the Essential Commodities Act, 1957 (III of 1957) all persons who had booked orders for the import of sugar into West Pakistan from abroad were required to sell the entire quantity of sugar arriving at Karachi after 17th day of October, 1968, to the Trading Corporation of Pakistan, Karachi, immediately upon its clearance from customs for home consumption at a price not exceeding aggregate of the landed cost, the usual incidental expenses and 6% margin of profit.' In pursuance thereof respondent No.1 informed the appellant about the arrival of the consignment. However, on 21‑10‑1968 another notification was issued which reads as follows:‑‑

"No. S.F.(Sugarl5(59)/67.‑‑‑ In exercise of the powers conferred by section 3 of the West Pakistan, Foodstuffs (Control) Act, 1958 (West Pakistan Act XX of 1958) the Governor of West Pakistan is pleased to order that all stocks of sugar imported by private importers, which have arrived at. Karachi on 17th October, 1968 or which may arrive thereafter, shall be sold to the Trading Corporation of Pakistan Ltd., at the cost price, plus 6% profit thereon." Thereafter correspondence was exchanged between the appellant and respondent No.1 and ultimately the appellant agreed to sell the consignment at the rate of Rs.78450 per metric ton and the customs duty, sales tax and other charges were to be paid by the appellant. The appellant also agreed to pay profit at the rate of 6% on cost calculated at Rs.784.50 per metric ton. The admitted position is that the appellant paid a sum of Rs.2,32,40,824.79 towards customs duty, sales tax and other charges. After the expiry of more than two years respondent No.1 served a notice dated 3‑10‑1971 claiming Rs.14,64,562 on the ground that cost price of the sugar was wrongly calculated by the appellant. The learned Single Judge taking note of these facts observed as follows:‑‑- "In my view in the instant case there is no question of any estoppel against a statute as no statutory price was fixed in terms of money for the imported sugar. In the first notification it has provided that an importer of sugar shall sell to the defendant No.1 the imported sugar at a price not exceeding the aggregate of the landed cost, the usual incidental expenses and 6% margin of profits. Whereas in the second notification issued by the Provincial Government, the words `cost price' plus 6% profit were substituted. Since the term `cost price' is a relative term, as rightly conceded by the learned counsel for the parties, it will have different meaning in different sets 1 facts. In the instant case it was open to the plaintiffs to agree upon a basis for the purpose of determining the cost price. In the present case the parties have agreed upon a basis for determining the cost price contained in Exhs.9, 10, 11 and 11/1 and by doing so, they have not violated any provision of law. The plaintiffs having agreed upon the aforesaid basis and having received full payment for the entire quantity of the imported sugar and having not raised any objection for nearly 3 years after the receipt of the payment cannot reopen the above issue as it is a past and closed transaction. In my view the plaintiffs had waived their right, if any, to claim any additional amount than what was agreed to between the parties. In any case, the plaintiffs had acquiesced to the aforesaid basic arrangement.". The learned Division Bench disagreeing with the finding of the learned Single' Judge observed that:‑

"The dispute between 'the parties has to be resolved on correct interpretation of Notifications and correspondence 'between the parties are extraneous documents. These documents cannot be considered for the purposes of resolving the dispute."

3. By both the notifications the importers were required to sell sugar to the appellant. According to the first notification the sale price was not to exceed the aggregate of the landed cost plus incidental expense and 6% margin of profit. This notification was rescinded by a subsequent notification, dated 21‑10‑1968 where it was provided that the sugar shall be sold to the Trading Corporation of Pakistan Limited at the cost price plus 6% profit thereon. It, therefore, seems clear that under this notification appellant was to pay 6% profit on the cost price. It has been contended by the learned counsel for the respondent that customs duty, sales tax and other incidental expenses are included in the cost price whereas the learned counsel for the appellant has pointed out that all such charges and expenses could be included provided they were paid by respondent No.1. It is an admitted position that the appellant had Paid all such charges and expenses amounting to Rs.2,32,40,824.79 and cleared the goods from the port. It was with the consent of the respondent No.1 that the appellant had paid and cleared the goods. Respondent No.1, therefore, was not required to incur such expenses which would have been necessarily paid by it before clearing the goods. As respondent No.1 had not incurred any expense or paid these charges they could not be added to the cost price of the goods imported by it. The equitable principles as enunciated in section 70 of the Contract Act are that if a person lawfully does anything for another person or delivers anything to him not intended to have done so gratuitously and such other person enjoys benefits thereof the latter is bound to make compensation to the former for the thing so done or delivered. There is nothing on record to show that the appellant had paid gratuitously. It was a business arrangement between the parties benefit of which ultimately was enjoyed by respondent No.1 as it had not to make arrangement for payment of a huge amount of more than Rs.2 crores and pay incidental charges thereon for clearance of goods from the port. In any event respondent No.1 had incurred and paid the cost @ Rs.784.50 per metric ton and was, thus, entitled to profits @ 6% on the same amount which was paid by it. We, therefore, allow the appeal, set aside the judgment of the Division Bench and restore the judgment and decree passed by the learned Single Judge with no order as to cost. M.BA./T‑78/S???????????????????????????????????????????????????????????????????????? Appeal allowed.