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Hari Charan Das v. Taraprasanna Sen

Calcutta High Court
Feb 6, 1924
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Structured Summary of the Opinion

Factual and Procedural Background

This is an appeal from the decision of the Subordinate Judge, First Court, Barisal. The plaintiffs sued to recover Rs. 6,500 with interest. At trial they obtained a decree for Rs. 2,000 with interest; the plaintiffs appealed against that decree. Defendant No. 1 filed a cross-objection contending that the suit should have been dismissed as against him.

The plaintiffs' factual case at trial was that Tarini Kumar Gupta and another had purchased certain estate properties at auction in execution of a decree. Defendants Nos. 2 and 3 were related to the deceased estate-holder (defendant No. 2 being his brother and defendant No. 3 his wife). The auction-purchasers had purportedly contracted to sell the properties to defendants Nos. 2 and 3 for Rs. 6,000 (with Rs. 1,000 earnest paid). The plaintiffs (who were tenants on the land) negotiated to obtain a permanent lease and, as part of the arrangement, agreed to pay a sum (ultimately Rs. 6,500) so that defendants Nos. 2 and 3 would re-purchase the property and grant the plaintiffs a patta.

On 15 February 1914 (3rd Falgun 1320) the plaintiffs allege they paid Rs. 6,500 to defendant No. 1 to be at once paid to the auction-purchasers. It transpired the auction-purchasers had already agreed to sell to others (Durga Charan Das and Kali Charan Das) and had executed a sale deed on 16 February 1914. The plaintiffs then agreed the money should be retained pending a suit for specific performance; defendant No. 1 allegedly gave a receipt and undertook to repay the money if the suit failed. That suit was ultimately dismissed on appeal by the High Court on 9 August 1917. The plaintiffs claimed repayment with interest at 6% per annum from that date.

In the plaint the plaintiffs sought relief against defendant No. 1 only and joined defendants Nos. 2 and 3 pro forma; the written statement of defendant No. 1 denied receipt of the money and the signature on the receipt, but alleged Rs. 2,000 had in fact been paid to defendant No. 2 by the plaintiffs and others. The Subordinate Judge held that Rs. 2,000 (and no more) had been paid by the plaintiffs and that defendant No. 1 was bound to repay that sum. On appeal the court re-examined the evidence and reached the conclusions summarized below.

Legal Issues Presented

  1. Whether on the evidence the plaintiffs paid Rs. 6,500 to defendant No. 1 as alleged.
  2. Whether defendant No. 1 is liable to repay the sum (and thus whether the plaintiffs are entitled to the full amount claimed with interest).
  3. Whether defendant No. 1 acted as agent for defendants Nos. 2 and 3 (such that he would not be personally liable) and, if so, whether that agency relieves him of personal liability.

Arguments of the Parties

Plaintiffs' Arguments

  • The plaintiffs asserted that they paid Rs. 6,500 (Rs. 5,000 by Hari Charan Das and Rs. 1,500 by Rup Chandra Das) to defendant No. 1 on 15 February 1914 to be paid on to the auction-purchasers.
  • When payment could not be made to the auction-purchasers, the plaintiffs agreed the money should be retained pending their suit for specific performance, and they obtained a receipt from defendant No. 1 in which he undertook to repay the money if the suit failed.
  • They sought repayment of the full sum (with interest) from defendant No. 1 only; defendants Nos. 2 and 3 were joined pro forma.

Defendant No. 1's Arguments

  • He denied that any money was paid to him and denied that the receipt for Rs. 6,500 filed with the plaint was signed by him.
  • He alleged that only Rs. 2,000 was paid and that that sum was paid to defendant No. 2 by the plaintiffs and others.
  • On appeal he sought to argue that, even if money had been received, he acted as agent for defendants Nos. 2 and 3 and therefore was not personally liable to repay.

Defendants Nos. 2 and 3

  • They were joined pro forma in the plaintiffs' suit. The plaint asked for no relief against them except contingently if the court should hold they also ought to be liable. The appeal against them was dismissed by the court.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The court examined the trial evidence afresh and disagreed with the Subordinate Judge's limited finding that only Rs. 2,000 had been paid. The court's reasoning proceeded in several steps, each grounded on the evidence set out in the record:

  1. Examination of the plaintiffs' cash accounts: The court reviewed the accounts produced by Hari Charan Das and concluded they did not contradict the plaintiffs' claim to have had Rs. 5,000 on the relevant date. Although the Subordinate Judge inferred from gaps in the account entries that the plaintiff could not have had the money, the appellate court found that the accounts were irregularly maintained and that entries had been made in batches without showing exact dates. The court treated the accounts as genuine and as corroborative rather than contradictory evidence.
  2. Failure to cross-examine: The court emphasized that the defendant No. 1 had not meaningfully cross-examined the plaintiffs' witnesses (for example, had not put to Hari Charan questions that would have allowed explanation of the accounts or challenged their genuineness). The court viewed the absence of such cross-examination as weakening the defendants' position.
  3. Credibility of the receipt and its witness: The receipt (exhibit 1) was witnessed by a practising pleader, Ganga Charan Das Gupta, who testified that he had signed the receipt at the request of the plaintiffs' agent. The court found it improbable plaintiffs would obtain a forged receipt signed by such a pleader and noted the pleader's own problematic conduct in signing without verifying contents. The Subordinate Judge had not made an express finding on the receipt's genuineness; the appellate court accepted that the receipt was signed by defendant No. 1 and that he undertook to repay if the suit failed.
  4. Practicalities of handling the money and related inferences: The court addressed objections that it was improbable the plaintiffs would carry and entrust so large a sum in silver coins to a hotel-keeper. The appellate court found the plaintiffs' explanation plausible, noted that part of the defendants' own evidence showed Rs. 2,000 had been paid without an immediate receipt, and observed the lack of searching cross-examination on how the money was transported and stored. The court considered the cultural and habitual practices relevant to those arrangements and accepted the plaintiffs' account.
  5. Agency defence considered and rejected: Defendant No. 1 argued on appeal that he was agent for defendants Nos. 2 and 3. The court noted that this assertion contradicted his written statement (which denied authority) and that no issue had been formally framed on the agency question. The court explained the legal requirements for an agency defence to succeed: it must be shown that the principal intended the money to be paid to the agent on the principal's behalf and that the agent accepted it as such. The court found no evidence that defendant No. 1 accepted the money on behalf of defendants Nos. 2 and 3; moreover, if the payment had been on account of the estate, it should have appeared in estate accounts which defendant No. 1 possessed but did not produce. Given these facts, the court held defendant No. 1 could not shift from denying receipt to denying liability if receipt were established.
  6. Overall assessment and credibility: Weighing the documentary evidence, witness testimony (including the pleader who witnessed the receipt), and the absence of effective challenge by the defence (in cross-examination or by production of estate accounts), the court concluded the plaintiffs had established payment of Rs. 6,500 and that defendant No. 1 had signed the receipt and promised repayment on failure of the suit for specific performance.

Holding and Implications

Holding: The appeal is allowed in part and the plaintiffs' claim against defendant No. 1 is allowed in full.

The court decreed that the plaintiffs are entitled to the full amount claimed (stated in the judgment as Rs. 6,503) with interest at 6% per annum from 10-8-1917 to the date of the judgment; the decretal amount will carry interest at 6% per annum until payment. The appeal as against defendants Nos. 2 and 3 is dismissed. The plaintiffs are awarded their costs in this Court and in the lower Court against defendant No. 1. Defendants Nos. 2 and 3 are awarded the costs of this appeal against defendant No. 1. The cross-objection filed by defendant No. 1 is dismissed. The judgment records: "Appeal accepted."

Implications:

  • The direct effect is that defendant No. 1 is personally ordered to repay the decretal amount with interest; defendants Nos. 2 and 3 are not held liable and their appeal portion was dismissed.
  • The opinion does not state that it sets or announces a novel legal precedent; its findings are based on evaluation of the evidence and standard principles regarding agency, burden of proof, and the consequences of failure to cross-examine or produce relevant documents.

Note: All factual recitals, legal questions, arguments, reasoning, and the final order in this summary are drawn exclusively from the provided opinion text.

Show all summary ...

1. This is an appeal against the decision of the Subordinate Judge, first Court, Barisal. The plaintiffs brought a suit to recover a sum of Rs. 6,500 with interest. They obtained a decree for Rs. 2,000 with interested and have appealed against this decree. The defendant No. 1 has filed a cross objection on the ground that the suit should have been dismissed as against him.

2. The plaintiffs' case, at the trial was as follows:—Tarini Kumar Gupta and another purchased at auction-sale in execution of a decree certain properties belonging to the estate of Syed Obidulla Choudhuri. The defendant No. 2 is a brother of Syed Obidulla Choudhuri who is now deceased and defendant No. 3 is the wife of defendant No. 2. After this purchase the auction-purchasers entered into a contract to sell those properties to the second and third defendants for Rs. 6000. That contract was entered into on the 23rd February 1912 and at that time Rs. 1,000 was paid as earnest-money. The plaintiffs were the tenants of land in the property sold on temporary lease and they were anxious that the defendants Nos. 2 and 3 should obtain the property and grant them a permanent lease. The defendant No. 1 is the Sadar Naib of defendants Nos. 2 and 3. The plaintiffs entered into negotiations and arranged to pay the sum of 7,250 rupees for a lease, the understanding being that defendants Nos. 2 and 3 should re-put chase the property and then grant them a patta. In view of this arrangement they paid, on the 15th February 1914, corresponding to the 3rd Falgun 1320, the sum of 6,500 rupees to the first defendant, the understanding being that this money should be paid at once to the auction-purchasers. It transpired, however, that the auction purchasers had already agreed to sell the property to other persons named Durga Charan Das and Kali Charan Das, and, as a matter of fact, a deed of sale in favour of these persons was executed on the 16th February 1914. When the plaintiffs ascertained that the money could not be paid to the auction-purchasers they agreed to its being retained in order that a suit might be brought for specific performance of the original contract of sale, ind they then demanded a receipt from the first defendant which was granted by him and in that receipt he undertook to re-pay the money after the final disposal of the suit if it should fail. The suit was brought an 1 it was finally dismissed on appeal by the High Court on the 9th August 1917. The plaintiffs, therefore, claimed this sum with interest at six per cent, per annum from that date. In their plaint they asked for this relief against the defendant No. 1 only. But they joined the second and third defendants as pro forma defendants apparently anticipating that defendant No. 1 might raise the defence that he acted as agent for the other defendants and then in the suit heard in their presence it might be possible to obtain relief against them in the alternative. But the plaint as framed asked for no relief against defendants Nos. 2 and 3 except on the contingency that, should the Court hold on the evidence and the circumstances of the case that defendants Nos. 2 and 3 also ought to be liable, then a decree might be granted against them. The written statement of defendant No. 1 denies all the principal allegations of the plaintiffs. He denies that any money was paid to him or that the receipt for 6,500 rupees filed with the plaint was signed by him. He alleges, however, that a sum of 2,000 rupees was paid to the defendant No. 2 by the plaintiffs and others for the purpose for which the sum of 6,500 rupees was alleged to have been paid. The learned Subordinate Judge has hell that the sum of 2,000 rupees and no more was in fact paid by the plaintiffs to this defendant and that he is bound to re pay this sum. We have been through the whole of the evidence and we are unable to agree with the finding of the learned Subordinate Judge that the plaintiffs have failed to establish their case as to the payment of 6,500 rupees. The learned Subordinate Judge has dealt with this part of the case very shortly and has not discussed the evidence at length. The plaintiffs' story is that the plaintiff Hari Charan Das paid 5,000 rupees and Rup Chandra Das 1,500 ruppes. The principal point found againt this story is that the accounts produced by Hari Charan Das show that on the 2nd Falgun, when he left home with the money, he had not 5,000 rupees. We have examined the accounts and we are unable to hold that they support this finding. The accounts filed are accounts which were not written up daily but at intervals of few days; with reference to the period near the alleged payment of the money we have the accounts of the 28th Magh, the 3rd Falgun and the 9th Falgun. The account of the 28th Magh shows that the cash ??? hand at that date was 3,840 rupee and it is argued and the learned Subordinate Judge has held that as the account showed no credit entries previous to the 3rd Falgun no money could have been received between the 28th Magh and 2nd Falgun. In our opinion, that is not the correct inference that should be drawn. The accounts appear to us to be accounts I kept by a man who did not keep his accounts regularly. At intervals he wrote up his accounts, and when he wrote them up he wrote on the day that he wrote the accounts the transactions of the previous days without showing their actual dates. It seems unlikely that there should be no transaction for four or five days, and then on the fifth or sixth day a large number of transactions, if the accounts really show only the transactions of the dates on which the accounts were written. Further, it was the duty of the defendant No. 1, if he questioned these accounts, to cross-examine Hari Charan on them and give him an opportunity of explaining how he came to be in possession of 5,000 rupees on the 2nd Falgun. Not only was no such question put to him but no question was put to him suggesting that the accounts were not genuine. On the evidence we hold that these accounts are genuine and that, far from contradicting the plaintiffs' story, they are strong corroborative evidence.

3. Then, another reason given for disbelieving the payment of 6,500 rupees is that it is improbable that such a large payment would have been made without the plaintiffs' seeing that it was actually paid to Tarini Kumar Gupta. But we have it from the defendants' own evidence that, at any rate, the sum of 2,000 rupees was paid without a receipt being taken until soma days later. If the defendant No. 1 could be trusted with 2,000 rupees, it is not unlikely that he should have been entrusted with the larger sum of 6,500 rupees.

4. Further, we have the evidence of the receipt itself. This receipt was witnessed by a pleader practising at Barisal named Ganga Charan Das Gupta. He was examined for the Plaintiffs and his story is that he was asked by the plaintiff's agent to sign the receipt said to have been given by Tara Prasanna Sen and he signed it. Though Tara Prasanna Sen was not present at the time he never at any time subsequently asked Tara Prasanna whether he had signed it or not. This pleader was then living at Tara Prasapna's house. If this story is true the pleader was guilty of serious unprofessional conduct. But in any case as regards the evidence of the receipt itself it seems very improbable that the plaintiffs would have got this receipt signed by this pleader if it were a forgery. The case of defendant No. 1 on his evidence is that, though he did not sign this receipt, he signed another receipt for 2000 rupees under the direction of defendant No. 2. It was not suggested in the cross-examination of any witness that the receipt for 2,000 rupees had been granted; nor was any attempt made to support the defendants' case on this point by other evidence than his own though he says that these facts were made known to two pleaders one of which is dead; but the other might have been called. The learned Subordinate Judge came to no finding as to whether this receipt was genuine or not. But he has held that if it be genuine there was some conspiracy between the plaintiff's and defendant No. 1 But that is nobody's case.

5. Then as regards the payment of the money, it is the plaintiffs' case that this sum of Rs. 6,500 was brought to Barisal in silver coins and was kept that night at the house in charge of the keeper of the hotel where he stayed. No attempt was made to test the truth of this story by cross-examination. One would have thought, having regard to the fact that this money must have weighed over two maunds, there would be ample material for a searching cross-examination, as to how it was conveyed to the hotel and from the hotel to Tara Prasanna. The natural inference to draw is that the defendants' legal advisers omitted to cross-examine the witnesses on this point for fear that such cross-examination would have the effect of strengthening the plaintiffs' case it is suggested that it is unlikely that the plaintiff would have kept so much money in charge of the hotel-keeper, a man of no substance, and that they would prefer to keep it with their pleadar or zemindar who live at a short distance. Having regard to the habits and customs of these people we see nothing improbable in the story. It appears from the evidence that, though the money was made over to the hotel-keeper's charge, the plaintiffs or members of their party themselves slept on the chest in which the money was kept.

6. It is further urged, having regard to the negotiation as to re-purchase of the property the plaintiffs would have paid the money far earlier. The only evidence we have as to the actual contract between the defendants Nos. 2 and 3 and the auction-purchasers is contained in the plaint filed by defendants Nos. 2 and 3 in the suit for specific performance. As that suit failed we cannot hold that the plaint gave an accurate account of the contract, and it is hard to draw an inference as to the probability or improbability of the conduct of the plaintiffs in the present suit when we do not know what the conditions were. But we think there is nothing improbable that the plaintiffs, though ready to pay the money for the purpose stated, did not pay it until too late, having regard to the frequency of delay in these matters; and it is but improbable that, when the plaintiffs discovered that there was danger of the property being sold to somebody else, they made a special effort and collected the money in the hopes of inducing the auction-purchasers by a large cash payment to sell the property as they desired.

7. For the above reasons, we hold on the facts that the plaintiffs did pay the sum of Rs. 6,500 to the defendant No. 1 and that the defendant signed the receipt, exhibit 1, and undertook to re-pay the money on the failure of the suit for specific performance.

8. On behalf of defendant No. 1 it is urged strongly before us that, even on these findings of fact, we should hold that the defendant No. 1 is not liable as he acted as agent on behalf of defendants Nos. 2 and 3. But this is not the case which the defendant tried to make on his evidence. In paragraph 4 of his written statement he denied having any authority to make the contract or receive the money mentioned in the plaint. No issue was framed on the question whether the defendant No. 1 acted as agent or not. His case now rests on the evidence of the plaintiffs themselves and some other witnesses to the effect that the money was paid to Tara Prasanna upon the verbal order of defendant No. 2. We do not think that defendant No. 1 can make out this case having regard to the case he made both in his written statement and in is evidence before the Court. He is not entitled to say, “I have not received the money; but if I did receive it I am not accountable for it.” It was not the plaintiffs' case that he acted as agent of defend in ts Nos. 2 and 3; their evidence as to the circumstance under which the money was paid is not necessarily contrary to their case that the defendant No. 1 did not receive the money as agent of defendants Nos. 2 and 3. The mere direction to the plaintiffs to pay the money to defendant No. 1 would not alone make the defendant No. 1 the agent of defendant No. 2. It would be necessary to prove that defendant No. 2 intended that the money should be paid to deft. No. 1 on behalf of deft. No. 2 also it is necessary to show that deft. No. 1 accepted the money as a payment on behalf of deft. No. 2 Further, if deft. No. 1 had received the money on behalf of the other defendants it would have been entered in the estate accounts. It is in evidence that defendant No. 1, who is no longer a servant of defendants Nos. 2 and 3, is in possession of the accounts in which this payment would have been entered, if it had been a payment on account of the estate. These accounts have not been produced by him.

[The judgment then disapproved the conduct of the pleader Mr. Ganga Charan Das Gupta in signing the document without knowing or caring to know the contents]

9. The result is that this appeal ??? decreed. The plaintiffs will obtain decree for the full amount claimed by them, that is, Rs. 6,503 with interest at 6% p.a from 10-8-1917 to this date. The decretal amount will carry interest 6% p.a until payment. As against defendants Nos. 2 and 3 the appeal is dismissed. The plaintiffs will get their costs in this and in the lower Court from defendant No. 1. The defendants Nos. 2 and 3 will get their costs of this appeal from defendant No. 1.

10. The cross-objection is dismissed.

11. Appeal accepted.