Appanna and BrOrs. vs Subbarayulu

Chandra Reddy, J.—This Civil Revision Petition raises a question relating to the jurisdiction of a Court to entertain a suit for damages for breach of contract. The circumstances under which it arise.; are I he; following:

The Plaintiff who is a merchant at Guddapah entered into a contract with the decedent a firm carrying on business hi horse-gram, etc., iu Parlakimidi, (Orissa State) for the purchase of 201 bags of horse-gram at Rs. 25-10-0 per bag and paid lis. 250 by way of advance. The terms of the contract contained in Ext. A-l are as follows:

To-day your man Chandaluru Narasimhulu contracted for 201 bags of horse-gram at the rate of Rs. 25-10-0 per bag of 207 lbs. with now gunny for Parlakimidi pass. For the horse-gram contracted we will indent for wagon and as soon as the wagon is allotted we will load the goods. I have received advance rupees two hundred and fifty only. The .said amount is credited to your Ichata. We draw a clean Hundi for Rs. 2,000. As soon as the Hundi is presented you must pay the amount. Alter deducting the advance, we send the pass through the Imperial Bank for the value.'''' Subsequently, the Defendant realised a sum of Rs. 2,000 by drawing a hundi on the Plaintiff in pursuance of the terms of the contract. But he did not supply any portion of the goods agreed to be sold by him to the Plaintiff and thus committed breach of contract. The Plaintiff has therefore brought the present suit in the Court of the District Judge, Kud-, . dapuh out of which this Civil Revision Petition arises.

Ono of the defences to the suit was that it f was not maintainable at Cuddapah as no part of the p. cause of action arose; within its jurisdiction. The Ife''plea was that as the ownership of the 201 bags of |K|l0rse-grarn mentioned therein was lo pass In I lie K Plaintiff immediately the contract was entered into l|5nd advance was paid, that thereafter the relation-Bahjp between the parties was only that of a creditor Bjpmd the debtor, that their undertaking to produce a wagon and to load therein 201 bags F.O.R. Parlakimidi was only a mode of delivery agreed upon, .that the whole cause of action had arisen at Parlakimidi and therefore it was only the Courts there that could entertain the .suit. On the invitation of the parties, the District Judge tried it as a preliminary issue and gave a finding against the Defendant. It is this order that is under revision now.

A preliminary objection is raised by the counsel for the Respondent that the Civil Revision Petition is incompetent for the reason that a finding on a preliminary issue is not a case decided within the meaning of Section 115 of the Code of Civil Procedure. It is maintained by him that, an order in an interlocutory application is not revisable and the only remedy to a party aggrieved by that order is to agitator that question finally in an appeal against the judgment. The basis of this argument is Buddhoo Lal and Another Vs. Mewa Ram, , where a Full Bench of tho Allahabad High Court held that the wind "case'''' did not include an issue or part of a ease, and therefore did not include an interlocutory order, and consequently the High Court has no power to interfere in revision with interlocutory orders in any .case. Later on, the opinions expressed by a single judge of that Court in Kishan Lal-Babu Lal Vs. Ram Chandra , and by a Division Bench of the same Court in Purshottam Lal Jaitly Vs. W.T. Henley''s Telegraph Works, Ltd. and Another, , were not quite in conformity with the view taken in Buddhoo Lal and Another Vs. Mewa Ram, . But Anr. Full Bench of the same Court decided that no revision lay from orders disallowing amendment of a pleading as such orders are discretionary but that an independent proceeding arising out of a case such as a proceeding to restore a case dismissed for default, or to set aside an ex parte decree, etc., may be a case decided and subject to revision.

On the other hand, it -has been consistently held by Madras and various other High Courts that the word "case" is wide enough to include an interlocutory order. K.E.P.V. Venkatachalam Pillai Vs. Rajaballi M. Sajun, , illustrates this principle. That case is ad idem with tire present: one. There a Civil Revision Petition was entertained against an order on a preliminary issue relating to jurisdiction. There are a number of cases which have established this principle and it is unnecessary to multiply citation. My view, therefore, is that a finding on a preliminary issue is a case decided falling within the operation of S. 115, CPC and this Court has jurisdiction to revise such orders. The preliminary objection is therefore overruled.

Now coming to the merits, the point for determination is whether the District Court of Cuddapah could take cognisance of tho matter. This in its turn depends upon whether any part of the cause of action has arisen at Cuddapah. Mr. Kuppuswamy (he learned Counsel for the; Petitioners has put forward the same contention in the lower Court. It is urged by him that under the contract the moment (ne goods were loaded in the wagon the property in the goods passed to the vendee and that thereafter the relationship between the Defendant and the Plaintiff was one of creditor and debtor, and was only as a debtor that the Plaintiff could receive and Silicate Works, Mad 145) (E). In that case a contract for purchase of certain glassware between the Plaintiff a merchant at Madras and the Defendants carrying on business at Calcutta was entered into at the latter place. The terms of the contract were to be found in a letter addressed by the Defendant to the Plaintiff:

Acknowledging receipt of your valued order through your agent, Mr. LiP Gupta, for 225 pros:12 oz. Powa bottles at Us. 10 per gross, K.O.H. Calcutta. The goods will be despatched by himself. As regards payment, your agent informed us that he will pay not less than 25 per cent., before the goods are despatched, and if possible more; and for the balance we will sent the railway receipt through Nedungadi Bank, Ltd., Broadway, Madras. The goods will be supplied on or before the 28th of the current month.

Construing this contract in a suit filed by the vendee for damages for breach of contract, the Chief Justice Rajammannar and Justice Satyanarayana Rao held that the implication of the agreement between the parties embodied in that letter was that the delivery of the goods was at Calcutta as they were to be delivered to the Plaintiff or his agent to be despatched to the Plaintiff''s place of business at Madras. The payment was to be made simultaneously with the delivery of the goods to the Plaintiff through his agent but the method of payment was that as provided in the contract itself and that the legal effect of these terms was to provide for the passing of the property from the seller lo the buyer at the time when the goods were delivered to the Plaintiff''s agent against payment of not less than 23 % of the price. Thereafter, the relationship of vender and vendee was converted into creditor and debtor.

A careful reading of the judgment would show that it was the term that provided for the delivery of the goods to the Plaintiff or to his agent at Calcutta at the place of the vendor against part payment of the price, that influenced the learned Judges to come to the conclusion that the contract contemplated that after delivery of the goods to the vendee or his agent the vendee became the absolute owner thereof and thereafter he was only in the position of a debtor. Such a term is absent in the instant ease and that distinguishes Use present one from the ease cited. For this reason I think the doctrine of 1948 2 Mad LJ 101: AIR 1949 Mad 145 (E), cannot, govern the instant case. In the case, on hand, the vendor was not to part will) his control over the good: until payment as seen from the fact that the railway receipt was to be sent to his bankers who could deliver the railway receipt only against payment. This means that the vendor reserved the properly in the goods and also power of disposal until payment was made. This is not a case where the vendor had endorsed the railway receipt in blank and passed it on to the vendee, which would indicate that he had parted with the control over the goods. On the other hand, it was intended that the railway receipt (should be obtained by the vendee from the bankers on the payment of balance of the price that remained unpaid. It is only when full price was paid that the vendee could obtain a railway receipt and take the property in the goods would have passed to the vendee as delivery to a common carrier was delivery to the vendee. I do not think this is the correct position, for as I have already stated, the vendee could not take delivery of the goods until the railway receipt was obtained by him and this could only be against payment. There is ample authority for this view of mine. In 68 Mad LJ 504: AIR 1935 Mad 6 (FB) (D) referred to above the Full Bench ruled that part of the cause of action arose at Tuticorin where the goods were to be paid for by hundis and against bills of lading in favour of the Defendant within the jurisdiction of that Court by honouring the bills at the branch of the Imperial Bank of India within the jurisdiction of that Court. The present ease falls within the operation of that ruling. I express my respectful accord with the statement of law contained therein. In my opinion a part of the cause of action arises at a place where the goods bought were to be paid for either by hundis or against the railway receipt sent by V. P. P. It cannot be disputed that a part of the cause of action to sustain a suit for damages for breach of contract arises where the payment of the price is to be made, because that is a part of the performance of the contract. The opinion expressed by a Bench of the Bombay High Court in The Bank of Morvi, Limited Vs. Baerlein Bros., and by a Bench of the Sind Court in Ugar Chand Gajanand Firm v. Firm Motiram Ghanshamdas, AIR 1938 Sind .18 is in consonance with this view of mine. It follows that the District Court of Cuddapah is not deprived of the jurisdiction to entertain the suit and the contention of the Defendant that the suit is not maintainable in that Court cannot prevail.

In the, result-the finding of the District Judge on the preliminary issue is affirmed and the Civil Revision Petition is dismissed with costs.