P L D 1969 Karachi 233 (PLP)

QADEERUDDIN AHMAD, J.‑‑This First Appeal has been preferred from the judgment of an Additional District Judge, Karachi dated the 30th of November 1962, by which he dismissed the suit of the present appellant with costs.

2. The facts which form the background are that the parties entered into a contract under which the appellant agreed to purchase from the respondent 275 bales of 40 bundles of 10 lbs. each of cotton yarn at the rate of Rs. 17‑10‑0 per bundle. The total number of the bundles came to 11,000 and total price to Rs. 1,93,

875. The contract was made on the 2nd of June 1959 and the goods were to be supplied in June with the option of the seller after the 20th of June 1959. Rs. 19,387‑8‑0 were deposited as earnest money by the appellant with the respondent. One of the terms of the contract was as follows: "This contract is subject to the terms and conditions of the contract of our (respondents) sellers M/s. H. M. Habibullah Company of 9/5/59."

3. The respondent supplied 200 bales in part performance of the contract and the price thereof was received by it partly by adjusting Rs. 14,100 out of the money which was deposited with it and partly by payment made in cash. This part performance of the contract left the responsibility of supplying 75 more bales on the respondent. The balance of the earnest money with the respondent was Rs. 5,287‑8‑

0. These bales were not supplied by the respondent; therefore, notices were sent by the appellant demanding that they should be delivered. The last notice is dated the 8th of September 1959, and is Exh. 7/P.

4. As the respondent did not comply with the demands, the appellant filed a suit bearing No. 2201 of 1960 on the 4th of August 1960, in the District Court at Karachi for the recovery of Rs. 11,964‑12‑

0. The break up of this amount, which is given in paragraph 5, is as follows: "The defendants are liable to pay to the plaintiffs, a sum of Rs. 5,287‑8‑0 being the balance amount of advance deposit and Rs. 6,000 being the loss suffered by the plaintiffs and Rs. 677‑4‑0 being the amount of interest from 1‑7‑1959 to 30‑6‑1960. The defendants are therefore, liable to pay to the plaintiffs a total sum of Rs. 11,764‑12‑0."

5. The suit was resisted by the defendant/respondent on various pleas which are reflected in the issues which were framed by the trial Court on the pleadings of the parties. Those issues are as follows:‑ "(1) Whether the contract dated 2‑6‑1959 between the plaintiff and the defendant was subject to the contract dated 9‑5‑1959 between the defendant and Messrs H. M. Habibullah Company? (2) Did Messrs H. M: Habibullah Company commit breach of the contract dated 9‑5‑1959? If so, what is its effect on the plaintiff's contract with the defendant? (3) Whether the plaintiffs committed any default ? If so, what is the effect? (4) Is the defendant entitled to forfeit Rs. 5,287‑8‑0 the amount of deposit of the plaintiff? (5) Whether the defendant wrote the letter dated 12‑9‑1959 to the Textile Commissioner? If so, what is its effect? (6) Whether the plaintiffs are not entitled to damages? (7) Whether H. M. Habibullah & Company is a necessary party to the suit? (8) Whether the plaintiffs had purchased the contract cotton for export purposes? (9) Relief." Issues Nos. 2 and 4 were decided against the defendant‑respondent but issues Nos. 3, 6 and 7 were decided against the plaintiff appellant. The other issues are not material, for the present purpose. On the basis of the conclusions arrived at under issues Nos. 3, 6 and 7, the learned trial Court dismissed the suit as mentioned above with costs and the plaintiff‑appellant has come in First Appeal to this Court.

6. Mr. Mansoorul Arfin appearing for the plaintiff‑appellant has argued that issue No. 4 having been decided against the defendant‑respondent there was no reason for the learned Judge not to grant a decree for the refund of Rs. 5,287‑8‑0 in favour of the plaintiff‑appellant. Secondly, counsel has argued that the trial Court has come to the conclusion that the defendant respondent did not commit breach of the contract on two grounds: Firstly, because the plaintiff appellant had not demanded delivery in terms of section 35 of the Sale of Goods Act; and Secondly, because the plaintiff‑appellant did not tender the price of 75 bales. These two grounds according to counsel do not have the sanction of law.

7. We find no difficulty in agreeing with the contention of counsel for the plaintiff‑appellant that after coming to the conclusion that the defendant‑respondent could not forfeit the amount of Rs. 5287‑8‑0 which was deposited by the plaintiff appellant with the defendant‑respondent, it was neither logically nor legally possible for the trial Court to omit to decree the refund of that amount to the plaintiff‑appellant. Mr. Shaikh Haider has attempted to support the view taken by the trial Court by saying that an inference to be drawn from the failure of the appellant to prove breach of the contract was that he could recover nothing from the defendant‑respondent. We have neither to see the correctness of this argument nor is there any reasoning given by the learned trial Court in support of the omission to order the refund of this amount. In spite of the decision of the trial Court that the defendant‑respondent was not entitled to forfeit the amount which was in deposit with it, no decree for its refund has been granted. We think that this amount was recoverable by the plaintiff‑appellant and hold accordingly.

8. Turning now to the question of the validity of the two grounds on the basis of which the learned trial Court came to the conclusion that the defendant‑respondent did not commit breach of the contract we find that the learned trial Court as appears from the discussion of issue No. 3, from the beginning followed the line of thought which does not appear to us to be sound. He started his discussion on issue No. 3 by referring to section 51 of the Contract Act on a presumption that this was a case of reciprocal promises. This was an error.

9. Mr. Shaikh Haider has contended that it was incumbent on the plaintiff‑appellant to apply for the delivery of 75 bales of cotton yarn in terms of section 35 of the Sale of Goods Act, but this argument does not take into account the provisions of the contract that the defendant‑respondent had the option of delivering the goods after the 20th of June 1959 up to the 30th of June 1959. Since it was the option of the defendant‑respon dent to deliver the goods, there was no question of the plaintiff‑appellant demanding delivery. This subject was under direct consideration of a Division Bench of this Court in Messrs Pakistan Khopra Mills v. Messrs Abdul Rashid Siddiki & Sons (P L D 1957 Kar. 781). Mr. Shaikh Haider argued that the option of the defendant‑respondent was operative up to the last day of the contract, that is to say, the 30th of June 1959 but was not operative on the 30th of June 1959 itself. This aspect has been considered in the above‑mentioned judgment as follows:‑ "I am not able to see, for the purposes of the present case, as to on what principle the application by the buyers under section 35 of the Sale of Goods Act can be deemed to be postponed up to the last and not inclusive of the last day of the period of contract. The demarcation would be entirely arbitrary." One of us was a party to that judgment and we are inclined to take the same view. Mr. Mansoorul Arfin has drawn our attention to one more judgment given by a Division Bench of the High Court of Madras reported as Messrs Sunderarama lyer & Co. v. M. Mudaliar (A I R 1957 Mad. 228). Mr. Shaikh Haider has not been able to draw our attention to any precedent to the contrary. We, therefore, conclude that the plaintiff‑appellant was not under any obligation to apply for the delivery of 75 bales on the 30th of June 1959. 10 Mr. Shaikh Haider tried to support the view of the trial Court by saying that the tender of the price of 75 bales by the plaintiff‑appellant was necessary because delivery of goods and payment of price are concurrent conditions in terms of section 32 of the Sale of Goods Act but this argument does no appear to us to be applicable to the facts of this case because the goods were not delivered by the defendant‑respondent and the excuse for not delivering them, which has been pressed by Mr. Shaikh Haider, is that no application for their delivery was made by the plaintiff‑appellant. Since we have come to the conclusion that the plaintiff‑appellant was under no obligation to make such an application, the question of considering the payment against delivery does not arise in the context of this case.

11. Coming to the conclusion that breach of the contract has been committed by the defendant‑respondent, we wanted to ascertain the quantum of damages. Mr. Mansoorul Arfin informed us that the only evidence in this respect was a statement of Altaf Hussain P. W. 1 who was Incharge of the Textile Department of the plaintiff‑appellant as follows :‑ "We bought 75 bales from market and had to pay Rs. 20 extra per bale. We bought them from H. A. Hassan of Karachi. At the time we bought 75 bales the rate was Rs. 19‑10‑0 per bundle of 10 lbs. We have suffered a loss of Rs. 6,000." A glance at the above statement shows that the witness has given no date of the transaction nor has he produced any documents in support of it. The quality of the cotton yarn has also not been mentioned by him. The evidence is therefore, unsatisfactory and inadequate for purposes of determining the loss that is alleged to have been suffered by the plaintiff‑appellant. The inadequacy lies in the fact that the measure of damages under section 73 of the Contract Act is the difference between contract and the market price prevailing on the date of the breach of the contract. The breach admittedly took place on the 30th of June 1959 ; therefore, the market price prevailing on that day was the measure to find out the excess amount which the plaintiff appellant could legitimately pay. In this case we have no idea of the market condition. It cannot be said as to whether the market was rising or falling, and there is no reason to presume that it was rising.

12. Mr. Mansoorul Arfin contended that although the best evidence has not been produced by the plaintiff‑appellant it is still necessary for purposes of doing justice that this Court should arrive at an approximate amount of loss which the plaintiff‑appellant has according to the above statement suffered. In this view of the legal situation he contended that some amount should be found to be due to the plaintiff‑appellant by way of damages. In support of this contention he has referred to Pakistan Indus trial Development Corporation v. Aziz Qureshi (P L D 1965 Kar. 202) and A. V. Joseph v. R. Shew Bux (49 I C 691). The relevant observation in the Karachi judgment is as follows: "On behalf of the appellants it was argued that since the respondent had failed to furnish evidence to show the details of his damages his suit merited dismissal or at the most he was entitled only to nominal damages. To repel this contention we can do no better than to refer to the decision of the' Judicial Committee in A. V. Joseph v. R. Shew Bux (A I R 1918 P C 149), where it was held that if in a suit for damages the Court finds in favour of the plaintiff that there was a breach, then simply because the plaintiff had not given sufficient evidence to show certain details of damages it is not proper to grant only nominal damages." The above quotation shows that the Karachi judgment is founded on the judgment of the Judicial Committee. A reference to the headnote of that judgment in the Indian Cases series discloses the following view of law "The difficulty of estimating damages is no ground for refusing to fix them, or for giving nominal damages only. If the party whose duty is to prove damages does not give the best evidence, every presumption should be made against him; if there is any range, the range should be taken against him but this does not relieve the Court altogether of the duty of assessing the damages as best it can on the evidence and materials actually before it." The above headnote expresses the view point of their Lordships of the Judicial Committee fairly and accurately but we feel that it does not support the contention of Mr. Mansoorul Arfin. We are in respectful agreement with the point of view that difficulties in estimating damages should not be excused for shirking the duty of solving the problem that may be before a Court and that the material which may be before the Court should be scrutinised and examined for purposes of finding what relevant and sound inference can be drawn from it. This attitude is however to be accompanied with the obligation that failure of a party to produce the best evidence should be reckoned against him. The .Lordships have gone to the length of saying that every presumption should be made against such a party. In the present case we find that there is no evidence at all of the price prevailing at the time at which the alleged purchase was made by the plaintiff appellant, nor is there anything to indicate the condition of the market on 30th June 1959, on which date the breach took place. Moreover, oral statement has been made without any documents to support it, which we do not consider to be the best evidence and feel justified in drawing the conclusion that adverse presumption should be made against the plaintiff-appellant in these circumstances, we are of the view that there is no material before us to enable us to hold that the plaintiff‑appellant has suffered any monetary loss.

13. In overall conclusion of the foregoing we partly accept this appeal and modifying the judgment of the trial Court holding that the defendant‑respondent must refund Rs. 5287‑8‑0 to plaintiff appellant with interest at the rate of 6 per cent. per annum from the date of the suit until payment. The parties are allowed to bear their own costs. A. B./K. B. A. Appeal partly accepted.