2003 PLP 535 (CLD)

(4) Whether the suit is liable to be dismissed as defendant has not been pleaded and sued through some authorised officer? OPD (5) Whether there is no relation between the plaintiff and defendant as purchaser and seller? OPD (6) Whether the plaintiff is estopped by his own word and conduct to file the present suit? OPD (7) Whether this Court lacks jurisdiction to hear the present suit? OPD (8) Whether the plaintiff has not come to the Court with clean hands? OPD (9) Whether the suit is defective in its present form, if so, its effect? OPD (10) Whether the suit has not been filed through authorized person of the plaintiff? OPD (11) Whether the plaintiff had no entitlement to the tin plates, till he had paid the full consideration thereof, and the defendant was not under any obligation to keep the tin‑plates for the plaintiff? OPD (12) Whether the suit is time‑barred? OPD (13) Whether the plaint is liable to be rejected under Order 7, rule 11, Civil Procedure Code? OPD (14) Whether the defendant is entitled to special costs under section 35‑A, if so, to what extent? OPD (15) Relief. Vide judgment and decree dated 13‑10‑1994 all the said issues were found in favour of the respondent and suit was decreed.

3. Mian Tariq Sultan, learned counsel for the appellant argues that this was case of sale of goods governed by the provisions of Sale of Goods Act, 1930. According to the learned counsel his client was unpaid, seller within the meaning of said law and since notice had been issued to the respondent for payment of the price within reasonable time and admittedly the price had not been paid within the said time, section 54 of the said Act authorised the appellant to sell the goods and to recover the damages in case any loss was to be occasioned but conversely respondent had no right to profits if any on the re‑sale. Relies on sections 20, 45 and 54 of the Sale of Goods Act,. 1930. In the same breath learned counsel argues that the property in goods had not passed to the respondent for the reasons that the goods had not been ascertained and price had not been paid. Further contends that notwithstanding the admitted position on record that a sum of Rs.2,00,000 was paid to the respondent through cheque, as acknowledged in para.8 of the plaint, the said amount has been included in the decretal amount. Presses C.M. 2/95 for permission to lead additional evidence while contending that a sum of Rs.90,000 and another sum of Rs.6,21,000 were paid to the respondent and had to be adjusted. Also contends that the plaint had not been presented by duly authorised person inasmuch as whereas the plaint narrates that the respondent‑company has authorised Mr. Anwar Chaudhry General Manager Finance to file the suit, the plaint has been signed and verified by the Chairman of the Company. Also refers to resolution Exh.P.1 in this behalf.

4. Mr. Zahid Hamid, learned counsel for the respondent on the other hand argues that it is neither case of the appellant nor of the respondent that the relationship between the parties is that of seller and purchaser. According to the learned counsel it is a case where goods were imported by the appellant for the respondent on its behalf subject to conditions settled. Contends that the appellant acted as an agent for respondent and was liable as such to compensate the latter for disposing of goods to its detrimental. Learned counsel relies upon the cases of Purushotham Haridas and others v. M/s. Amruth Ghee Co. Ltd. and others (AIR 1961 Andhra Pradesh 143), Gopaldas v. Thakurdas (AIR 1957 Madhya Bharat 20), Mul Chand Shib Dhan v. Sheo Mal. Sheo Parshad (AIR 1929 Lahore 666), Smt. Pani Bat and others v. Smt.Sire Kanwar and others (AIR 1981 Rajasthan 184) and N. Purkayastha and another v. Union of India (AIR 1955 Assam 33). Learned counsel concedes that the said amount as mentioned by the learned counsel for the appellant had been paid to the respondent and expresses no objection to the adjustment of the same and modification of decretal amount accordingly. Replying the last contention of the learned counsel for the appellant presses C.M. 1 /C/97 for permission to lead additional evidence to produce a resolution authorizing the Chairman to file suit and to sign the plaint. In the alternative prays that Anwar A. Chaudhry, who had signed the replication and verified the same and also appeared as D.W.1 be allowed to sign and verify the plaint.

5. Impressed by the concession made by the learned counsel for the respondent in the matter of application for additional evidence filed by the appellant, rather admission of the claim itself, learned counsel for the appellant withdraws the said objection in the matter of signing and verification of the plaint as objected by ,him. The said Anwar A. Chaudhry shall now sign and verify the plaint.

6. We have gone through the records of the learned trial Court. We find that so far as the particulars regarding the nature and quantity of goods, price, terms of payment and import of goods are concerned, there is no dispute. The goods were imported and arrived in Pakistan, remained in possession of the appellant till such time that these were passed on to the units owned and controlled by it on no profit no loss basis. Controversy to be resolved in this is as to relationship between the parties in the matter of import of the said goods and further at a point of time the goods arrived in Pakistan and when they were disposed of by the appellant.

7. Now the said contentions of the learned counsel for the appellant, to our mind, are self‑destructive. Before proceeding further we may state here that Mr. Zahid Hamid, Advocate, has very correctly stated that it was not case of any of the parties that there is relationship of seller and purchaser in the matter of said goods. We have already referred to the respective pleadings of the parties above, There is no allegation in the plaint that goods were to be sold by the appellant to the respondent or purchased by the respondent from the appellant. Similarly it has been specifically stated rather impressed in the written statement in form of preliminary, objections that there is no relationship of seller and purchaser between the parties. Reverting back to the contentions of the learned counsel for the appellant. On the one hand he says that the property in the goods had not passed to the respondent and on the other he presses the rights of appellant as unpaid seller. The only reason stated for latter plea is that the price had not been paid. Needless to state that price had been settled and promised to be paid. Now section 11 of the Sale of Goods Act, 1930 lays down in absolutely unambiguous terms that the stipulation as to time of payment or not deemed to essence of contract of sale unless of course different intention appears from the terms of the contract. No gainsaying the fact that there was neither a contract of sale nor is there any contrary stipulation therein. Section 54 of the Sale of Goods Act, 1930, being relied upon by the learned counsel, proceeds on the premises stipulated in the said section 11 of the Sale of Goods Act, 1930. On its plain reading said section 54 would be attracted in case where the property in the goods has passed to the buyer. This would be evident from the reading of subsection (2) of the said section

54. Under the said provision where the unpaid seller, to whom the buyer has not paid or tendered the price within a reasonable time, despite service of notice by him to the buyer to re‑sell, he may re‑sell goods and recover from the borrower damages for any loss occasioned on account of breach of contract. However, buyer shall not be entitled to any profit which may occur on the re‑sell. Subsection (2) of the said section 54 then further provides that if such a notice is not. given the unpaid seller shall not be entitled to recover such damages and buyer shall be entitled to the profit, if any, on the re‑sale. It will thus be seen that the said section 54 caters for a situation where property in the goods has already passed and in case of absence of notice the buyer is not liable to pay any damages and is also entitled to the profit, if any, on the re‑sale. The said contention, of .the learned counsel for the appellant is, therefore, neither here nor there and nothing turns on the same.

8. To our mind, a reading of the evidence on record would show that there had never been any cavil regarding the fact that property in the said goods always vested in the respondent. The manner and the intention with which the import was made stands admitted in the very pleading of the parties. Apart from this Exh. P.2 and the terms stated in the annexure thereto are revealing in this behalf. Exh.P.2 is a letter addressed by the appellant to the respondent informing that the next tender for import of Electrolytic Tinplate as specified in the said letter is due for import. The respondent was requested to intimate its requirement specifying size, quality and shipment in which it would like the same to be imported (there were two shipments). Letter then proceeds to state that respondent's question together with advance payment at the rate of Rs.650 per ton on "its share" be sent. The terms which are nomenclatured as "procedure for joint import of Tinplate and Chemicals" provided that Import Licence was to be arranged by the respondent and was to be transferred to the nominated bank of the appellant for establishing joint L.C. by GCP. The Condition No.3 calls upon the respondent to make advance payment equal to 8% of C & F value of "its share" and this was to include, inter alias 3% service charges payable to the appellant. The Condition No.6 provides for clearance of the entire consignment "including share of the respondent", which was delivered at Karachi Port to its unit. Now it is the case of the appellant itself as also reflected in the several communications addressed to the appellant such as Exhs.P.19, P.22 and P.26; that the respondent was being warned time and again that the goods will be sold at its risk and cost. A reading of the pleading of the parties and said documents particularly Exh.P.2 and its annexure would clearly show that the appellant imported the goods for and on behalf of the respondents on the terms settled against the import permit of the respondent. The goods were throughout treated as the property of. the respondent by using expression "its share of the imported goods or consignment". We may also refer here to Exh.P.28 which is letter dated 3‑6‑1987 addressed by the appellant to the respondent when latter requested vide Exh.P.27 to let the respondent lift 164.104 metric ton on cash payment and to purchase from the respondent 721.967 metric ton 'on the market value to settle accounts. In the said letter Exh.P.28 it was stated that the appellant imported tin‑plates against its own tender and included the quantity required by the respondent on its request. Thereafter there is reference to the goodwill gesture shown by the appellant in the matter of allowing extensions of time in the matter of lifting tin‑plate "imported for it". It was then complained that only consideration paid by the respondent to the appellant is 8% of the total value of the consignment which included only 5% as advance payment (we have already stated above that 3% was the service charges of the appellant). It was then stated that the total costs of the consignments "imported for respondent" was paid by the appellant on the day of the negotiation of documents. We deem it proper to reproduce para.2 of the said letter Exh.P28 hereunder:‑‑ "

2. In view of your failure to lift the subject consignments, despite extensions in time, further extension, as already intimated, cannot be allowed GCP also cannot agree to buy the tin‑plate in subject consignments at the market rate from you because it is under no obligation to do so and because the entire delay in lifting of the consignments between the time of their arrival and now, has been due to your failure to lift these consignments and not due to any action or inaction on the part of the GCP. In view of this position, it is regretted that the GCP cannot accede to your request." A bare reading of the above contents of the communication of the appellant to the respondent would show that parties were always ad‑idem that the goods are property of the respondent. The refusal to purchase the said goods was not based upon the absence of title but for reasons as stated above.

9. In the above almost admitted state of affairs on the record the contention of the learned counsel for the respondent stands borne out i.e. the appellant acted as an agent in the matter of said import of goods by the respondent and the transaction is subject to the incidence of agency governed by the relevant provision of law of agency as contained in the Contract Act, 1872. There is no cavil that the appellant having paid import price and incurred other expenses in the matter had lien on the said property of the respondent and having thus financed the deal could have acquired the said goods but this was subject to consent of the respondent as held in the case of Purushotham Haridas and others v. M/s. Amruth Ghee Co. Ltd. and others (AIR 1961 Andhra Pradesh 143). It is matter of record that the respondent never consented to acquisition of title by the appellant in the said goods.

10. Coming to the question of compensation. It has throughout been the stated case and plea of the appellant that in case of non‑payment of the value of the consignments, same shall be sold at the risk and cost of the respondent. Now the plain and simple meaning of the said concept is that the goods were to be sold in the market and the matter of risk and cost was to be determined accordingly in terms of sections 73 and 74 of the Contract Act, 1872. The appellant instead of resorting to the said provisions proceeded to treat goods as belonging to it and to pass them on to the units owned by it on no profit no loss basis. In this view of the matter respondent who was the lawful owner of the goods becomes entitled to compensation which is the difference between sale price and market price on the date goods were passed on by the appellant to the said units which is without any authority and clearly in breach of the contract/ arrangement between the parties in the matter of import of the said goods. Anwar Ahmad Chaudhry, P.W.2 has stated that at the time the appellant passed on the goods in the manner stated above C & F price of the same was U.S $ 670 per metric ton and exchange rate was Rs.17.62 per U.S $. Abid Tariq D.W.‑1 was unable to state as to what was a market value of tin‑plate in the year 1987. However, Khurshid Ahmad D.W.‑2 when confronted in the cross‑examination stated that C & F price at the relevant time was about U.S. $ 650 per metric ton. The witness did not remember that the price was U.S.$ 670 per ton. In this state of evidence it stands established that the C & F value at the relevant time was U.S. $ 670 per ton. It is on this basis that the total claim has been worked out at Rs.47,24,496.71. The objection to the calculation made in the statement accompanying Exh. P.38 have already noted above and stands conceded by the learned counsel for the respondent. The overall effect is that a sum of Rs.9,11,000 shall have to be adjusted to the credit of the appellant.

11. For all that has been discussed above, this RFA is partly allowed inasmuch as the suit filed by the respondent/ plaintiff shall stand decreed in favour of the plaintiff and against the appellant/ defendant in the sum of Rs.38,13,496.71. No order as to costs. Q..H./M.A.K./G‑203/L Order accordingly.