1. This is an appeal against an order of the learned Senior Subordinate Judge, Simla, returning the plaint for presentation to another Ct. The suit was for recovery of Rs. 10,725-6-6 on the basis of breach of contract to supply goods ordered by the Pltfs. & on the basis of a promise of the defts. to refund ss. 10,000 paid to them by the Pltfs. & for interest. In para. 10 of the plaint, the transaction was based on three grounds: (a) that the cause of action arose at Simla where the goods were to be delivered to the Pltfs. on payment of the balance of the price; (b) that after the defts. repudiated the contract to supply goods to them, the relation between the Pltfs. & defts. became that of creditor & debtor, & under the law it was the duty of the defts. to pay the money to the Pltfs. at Simla; (c) that the defts. also promised to send Rs. 10,000 to Simla.

2. The learned Judge has held that the Ct. at Simla had no jurisdiction on the ground (1) that it had not been proved that the goods were to be delivered & paid for at Simla, (2) that the goods were “bought F.O.R” & that the freight was to be paid by the Pltfs. & (3) that as the commission charges & freight had to be paid by the Pltfs. & the defts. were only commission agents no part of the cause of action arose at Simla.

3. In appeal the first point taken by Mr. Roop Chand is that the railway receipt for the goods was to be sent to Simla & the price was also to be paid at Simla. The goods were ordered by a letter dated 16-6-1947 in which the defts. were asked to purchase wheat & send it to Simla. It was stated there that a bill for the price should be drawn through a bank & that the bank charges would be paid by the Pltfs. In a letter dated 24-6-1947, P. 14, sent by the defts. to the Pltfs. it is stated that the railway receipt would be sent in the name of the Pltfs. but the price should be paid in advance. In the letter p. 7 dated 21-7-1947 the Pltfs. wrote to the defts. that the goods should be sent to Simla & that they had already sent the money.

4. In the next letter p. 17 dated the 25th July, the defts. wrote back saying that the goods would be sent from Abbaspur & for the balance of the price of the goods a bill would be drawn. On 30th July the defts. wrote to the Pltfs. saying that wheat had been purchased & would be sent when its turn on the list of priority was reached, & “it was also said that the despatch had been delayed as the priority was of the fourth class & things under first class permits were being despatched. Some other correspondence ensued which it is not necessary to refer to excepting the letter of 11-8-1947 Ex. p. 2 where the defts. said that the goods could not be sent as the authorities had stopped export of wheat from Lyallpur that the goods would have to be sold to some mill there & that the defts. could send the money by draft or cheque. To this the reply of the Pltfs. was that the money should be sent by means of a draft & the permit should also be sent back. It may be pointed out here that a permit for the sending of the wheat bad been sent by the Pltfs. to the defts. Subsequently a Hundi was drawn for Rs. 10,000 on 19-8-1947, but that was never presented to the defts. & was, therefore, never paid. On 22-8-1947 the defts. wrote to the Pltfs. that they should draw a Hundi for Rs. 10,000 on them & they could not send a draft as that would be lost in transit. The Pltfs. went into the witness-box & said that there was an agreement that goods were to be delivered in Simla & the price was also to be paid in Simla. In cross-examination, however, he stated that the defts. had to purchase the goods & oharge commission & other expenses from the Pltfs. The contract was entered into by means of correspondence & there was revocation of the contract. It was also admitted by the pltf. in the witness-box that he was to pay the railway freight & bank commission.

5. It is in these circumstances that I have to determine as to what was the nature of the contract between the parties & what was the relationship between them. The defts. were a firm of commission agents. An order had been sent to them to purchase goods & they agreed to do so if the money was paid to them. Part of the money was paid & for the balance the Pltfs. agreed to pay if a Hundi was drawn on them, they being responsible for bank charges. Rupees 10,000 was paid to the defts. by the Pltfs. by way of advance in relation to their purchasing & despatching of grain. The method of payment then was that instead of paying the whole of the amount at Lyallpur as was suggested in the letter of the defts. dated 24-6-1947 (ex p. 14) part of the money was Page: 380paid & part of the money “was to be paid through a bank. In other words, instead of a man going from Simla to Lyallpur & handing over the money in cash money was paid partly in cash & partly was to be paid through a bank against Hundies drawn. This was nothing more than a method of payment. There is no direct evidence excepting the bald statement of the pltf. himself that the goods were to be delivered in Simla & the price was to be paid there. The course of correspondence which I have referred to above on the other hand shows that the price was to be paid in Lyallpur & the goods also were to be delivered in Lyallpur. In the same letter, Ex. P. 14 the defts. said that the railway receipt would, be sent in the name of Pltfs. In other words, after the goods had been purchased they would be handed over to the common carrier, the railway. The arrangement that goods were to be sent to the Pltfs. through the railway & the railway receipt was to be in the name of the consignee was never altered at any stage. At no stage had the defts. agreed that they would deliver the goods in Simla or received the payment in Simla. The fact that freight was to be paid by the Pltfs. & bank commission was also to be paid by them showed that the delivery & the payment were both agreed to be made at Lyallpur. The resps. have submitted in this Ct. that this was not a case of price which was to be paid against a railway receipt. The correspondence shows that this contention is well-founded.

6. In the present case, as I have said before, the relationship of the parties was of principal & commission agent. In the present case, in my opinion, no part of the cause of action arose at Simla. The suit such as the present one against an agent arises at the place where the goods were to be supplied or the money was to be paid. The rule has been laid down in Salig Ram v. Chuha Mal, 34 All. 49 : (11 I.C 712) where the Pltfs. who were grain-dealers at Hathras asked the defts. commission agents at Karachi, to send two wagon loads of juar. They sent Rs. 600 in advance & another Rs. 600 by means of a Hundi. The railway receipt was on the pltf's. instructions sent value payable for the balance due to the deft. For some reason, it was not delivered to the Pltfs. & the grain was not delivered till very late & as the price of juar. had fallen the Pltfs. brought a suit for compensation on account of the negligence of the defts. & instituted the suit at Hathras. It was held that the suit was not cognizable at Hathras because the cause of action had arisen at Karachi. It was observed at p. 52:

“The latter was the applt's. agent, & it was his duty to purchase the grain at Karachi, to place it on the railway at Karachi, & despatch it to the pltf's. address… It is thus quite clear that the deft's neglect or misconduct or both, took place, if at all, at Karachi. In the course of the transaction he had nothing to-do outside Karachi. He had not contracted to deliver at Hathras, but merely to place the goods on the rails at Karachi & to post the railway receipt there also. We fail to see that the cause of action, i.e, the deft's. alleged neglect or misconduct which resulted in loss, occurred anywhere else but at Karachi.”

7. This case was followed in J.M.V Rowther v. K.M.M Bowther, 55 I.C 266 : (A.I.R(7) 1920 L.B 48). There the deft, was employed by the pltf. as his agent in Tiruvaloor. The letter of employment was addressed to the deft, at the same place & was accepted by the deft, by letter through the post. It was held that the contract was clearly to be performed at Tiruvaloor & as the suit was based upon a contract of agency the cause of action took place at the place where the agent resided. The same was held in Mylappa Chettiar v. Agha Mirza Mahomed, 37 M.L.J 712 : (A.I.R(7) 1920 Mad. 177). The pltf. in that case was a trader at Negapatam & offered to buy timber from the deft, at Mandalay who accepted the offer. Under the terms of the contract, the deft, shipped the timber from time to time at Mandalay, took the bills of lading in his own name & drew from a bank at Mandalay such sums of money as were due to him in respect of the timber shipped, by handing over the bills of lading to the bank who in their turn passed it on to the pltf. through another bank with whom the pltf. had dealings. The deft, made default in sending the timber as agreed & a suit for damages was brought at Negapatam. On an objection being taken to the jurisdiction, it was held that no part of the cause of action arose at Negapatam. It was held that the bank in Madras & that at Mandalay were the agents of the pltf. & that in fact & in law the delivery of the goods was made at Mandalay & the payment was also, made there. In Bhamboo Mal v. Ram Narain, 9 Lah. 455 : (A.I.R(15) 1928 Lah 297), it was held that a suit by a principal against a commission agent who has agreed to execute an order placed with him by correspondence must be instituted at the place where the commission agent carries on his business & that a principal cannot sue him at the place from where he sent the order. In this case the pltf. belonged to Rawalpindi & the deft, to Srinagar in Kashmir. The pltf. sued for recovery of money paid to the latter as commission agent for the purchase of dry apricots which the deft, had failed to deliver. Reliance in this case was placed on Asa Ram Kalu Ram v. Bakhshi Page: 381Ram Kanahyia Ram, 1 Lah. 203 : (A.I.R(6) 1919 Lah. 26) and Prithi Singh-Jmayat Rai v. Harsukh Das Jhog Mal, 75 I.C 849 : (A.I.R(11) 1924 Lah. 593).

8. The applt. relies on a F.B judgment of the Madras H.C in Venkatachalam Pillai v. Rajaballi M. Sajun, A.I.R(22) 1935 Mad. 663 : (156 I.C 1041 F.B), where it was held that in a case where payment for goods purchased by the pltf. or on his behalf by somebody else (was to be made at Tuticorin by bills drawn against & presented to the pltf. at the same place, then part of the cause of action arose at that place and, therefore, a suit for an amount due for short fall in goods ordered & for damages lies in a Ct. in that place. In this case the question whether the Pltfs. & the defts. were principal & agent was not taken into account. It was held that goods were to be paid for by Hundis & against bills of lading in favour of the deft, at Tuticorin by honouring the bills at a bank in that place & as the pltf. could not get possession of the goods without paying for them at Tuticorin the case could be tried at Tuticorin. This case in my opinion can be distinguished on the ground already given above & because the goods were to be paid for by Hundis & against bills of lading in favour of the deft. In the case now before me, the goods were to be paid for at Lyallpur. Part of the price had as a matter of fact been paid there. The balance instead of being paid in Lyallpur as was demanded by the defts. was to be paid by the pits, to a bank for its being paid to the defts. at Lyallpur. This is clear from the fact that they were to pay the commission. The Pltfs. also relied on Motilal v. Suraj Mal, 30 Bom. 167 : (6 Bom. L.R 1038) but, there, instructions were sent to the defts. from Bombay, accounts were rendered to the pltf. at Bombay, & demand was made from Bombay to the defts. In the peculiar circumstanoes of that case under cl. 12, Letters Patent, leave was given to sue at Bombay. I do not think that case has any application to the facts of the present case. The applts. then submitted that there was an express promise to pay the money at Simla by draft. In reply the resps. submitted that they never promised to pay the money at Simla. All they offered was that they could send the money either by draft or by cheque. In either case the bank charges would have had to be paid by the Pltfs. & that makes all the difference, for the money would then be paid at Lyallpur & not at Simla.

9. Lastly, it was submitted that the contract was revoked & the revocation was accepted at Simla & reliance was placed on a judgment of the Patna H.C in Dhanraj Mills Limited Liability Co. v. Narsingh Prasad, A.I.R(36) 1949 Pat. 270 : (27 Pat. 723), where it was held that when there has been renunciation or disclaimer of a contract, the renunciation or disclaimer takes place when & where it is communicated to the other party to the contract. In the first place, it is not proved that there has been any renunciation or repudiation of a contract. In the letter of the defts., Ex. P. 2 dated 11-8-1947 it was said that the goods could not be sent as permission to send had been revoked by the officials of the Food Department & that the goods would be sold to some mill in Lyallpur & defts. asked whether the money should be sent by draft or by cheque. If there was anything at all, it was frustration of the contract, but it is not necessary for me to express any opinion on this point. At any rate there was no renunciation or repudiation of contract by the defts. They were never unwilling to perform their part of the contract. All they said in the letter was that due to circumstances beyond their control the goods could not be sent out of Lyallpur.

10. I am of the opinion, therefore, that the learned Senior Subordinate Judge rightly came to the conclusion that he had no jurisdiction. The appeal, therefore, fails & is dismissed with costs.

D.H

11. Appeal dismissed.