Jwarmal Shivanath Malu v. Haji Ibrahim Kassam Uplitwala

1. The petitioner is the defendant, a merchant of Tasgaon in Bombay Province. The plaintiff in the suit does business in Calicut and ordered a quantity of ‘New Chillies Chatni bast, dried, thin red’ after approval by sample from the defendant. The contract was admittedly one known as C.I.F and F.O.R Tasgaon. On the arrival of chillies in Calicut, the plaintiff according to his plaint allegations, found on examination that the chillies were of inferior quality and not according to sample. He had a survey made by the Chamber of Commerce of Calicut whose report, he said, would bear out his allegations. After notification to the defendant, who made no response, the chillies were sold at the risk of the defendant. The plaintiff had paid Rs. 2900-4-0 by a hundi to the defendant before the goods were despatched. The suit was filed in the District Munsif's Court of Calicut to recover a loss of about Rs. 1500. The District Munsif of Calicut held that he had no jurisdiction as the cause of action arose in Bombay Presideucy. In appeal the learned Subordinate Judge was of the opinion that part at least of the cause of action arose within the jurisdiction of the Calicut Court which was competent to entertain the suit, the merits of which have not been gone into.

2. There can be no doubt that had the chillies been sent according to sample, the Bombay Court alone would have jurisdiction as the cause of action arose wholly in that province Parthasarathy v. The Calcutta Glass and Silicate Works (1936) Ltd., 1948-2 M.L.J 101 : (A.I.R (36) 1949 Mad. 145), is a Bench decision of this High Court on which reliance is placed for this position. This decision, however, makes no reference to a case such as the present, where goods not according to sample were despatched from outside on F.O.R contract to this Province.

3. Mr. Ramachandran for the petitioner relies on an English decision in Bidiell Brothers v. E. Clemens Horst Company, 1911-1 K.B 214, which gives him no assistance. That was a case of a contract for sale of one hundred bales of hope of a particular quality to be shipped provided the buyer paid at certain rate C.I.F to London, Liverpool, or Hall, Terms not cash. The buyer contended that he was not bound to pay for the hope until their arrival at their destination and a reasonable opportunity had been allowed to him for examination to see if they were in conformity with the contract. It was held that the seller was entitled to payment against shipping documents upon delivery of the hops on board the ship at the port of shipment, the buyer's right to reject the hope remaining unimpaired if upon arrival they were found upon examination not to be in conformity with the contract.

4. Under Section 17 of the Indian Sale of Good Act, in the case of a contract for sale by sample, there is an implied condition.

(a) that the balk shill correspond with the sample in quality;

(b) that the buyer shall have a reasonable opportunity of comparing the bulk with the sample;

(c) that goods shall be free from any defect rendering them unmerehantable, which would not be apparent on reasonable examination of the sample.

Under Section 41 of the Indian Sale of Goods Act, where goods are delivered to the buyer which he has not previously examined, he is not deemed to have accepted them unless and until he has had a reasanable opportunity of examining them for the purpose of ascertaining whether they are in conformity with the contract. And under S. 43, unless otherwise agreed, where goods are delivered to the buyer and he refuses to accept them, having this right so to do, he is not bound to return them to the seller, but it is sufficient if he intimates to the seller that he refuses to accept them.

5. The law presumes delivery to the buyer on a C.I.F or F.O.R contract at the time of consignment on the basis that goods according to sample are being consigned. If the seller fails to supply goods according to sample or dishonestly supplies goods of another description, the buyer in law has a right to refuse acceptance. This being the case, it cannot possibly be said that no part of the cause of action arose in Calicut where the plaintiff made the discovery that the goods consigned were not according to sample. The District Munsif of Calicut has clear jurisdiction to try the suit resulting from damages alleged by reason of the breach of the implied contract underlying the C.I.F or F.O.R contract, that the goods supplied would be in accordance with the particular sample or description. The learned advocate for the petitioner urges that if the property in the goods did not pase to the plaintiff, as they were not according to the sample, he should have returned them to the defendant in Bombay and that he had no right to sell the chillies. But under Section 43 of the Indian Sale of Goods Act, if the goods were not according to the sample he had a right to refuse acceptance; he was not bound to return them to the seller and it was only sufficient for him to send intimation to the seller that he refused acceptance. It cannot possibly be said that by selling the goods with notice to the defendant, the plaintiff in the circumstances took delivery of the goods and thereby destroyed his right to sue in the Calicut Court. It would be strange in law that if a merchant in Madra?, orders advertised goods, pays for them and finds on opening the consignment sent to him that they are not according to sample or of an entirely different description, he should be compelled to go to the Court in which the consignee lives and sue him there. I have no hesitation in expressing my agreement with the finding of the learned Subordinate Judge that in cases of this kind, a part of the cause of action arises in Madras and a suit for damages would lie in the Court in the Madras Province.

6. The petition is dismissed with costs.

C.R.K/M.K

7. Petition dismissed.