JUDGMENT Gentle, J. - The defendant District Board was incorporated under the Bengal Local Self-Government Act, Act 3 [III] of 1885, (hereinafter called the "Act") the provisions of which govern it. The plaintiff company was incorporated under the Companies Act on 30th July 1903. It constructed and maintained a tramway or light railway about 52 miles in length of which about 33 miles run along the roadways within the area of the Board. The claim by the company against Board, as originally made in the plaint filed on 22nd August 1941, is for Rs. 1,04,000 being the aggregate of three sums of Rs. 38,000 (less Rs. 10,000 paid and for which credit is given) alleged to be due during each of the three years ending on 31st March 1939 1940 and 1941. This claim is made under six agreements by which it is alleged the Board guaranteed to supplement the net earnings of the company by such annual sums, not exceeding Rs. 38,000, as might be necessary to make the net profits equivalent to Rs. 1500 per annum per mile of the tramway system. The correctness of the amount, as such, is admitted solely for the purposes of the present suit and to avoid the necessity of taking an account in the event of the company's claim succeeding. This admission, however, is made without prejudice to the Board disputing in any future proceedings, in respect of other years, the method of accountancy by which the sum claimed has been computed. The trial commenced on 22nd April 1943 at which date the above mentioned claim was the sole matter arising in the suit. The hearing was interrupted by the Easter recess of the Court and at its conclusion the trial was resumed on 5th May 1943 when the opening of the plaintiffs' case was taking place. On this date Mr. S. N. Banerjee, learned counsel for the Board, raised the question for the first time that the agreements upon which the claim was made are not binding upon, and enforceable against the Board on the ground they were not executed by the Board as required by the Act and the rules made thereunder. Mr. On this date Mr. S. N. Banerjee, learned counsel for the Board, raised the question for the first time that the agreements upon which the claim was made are not binding upon, and enforceable against the Board on the ground they were not executed by the Board as required by the Act and the rules made thereunder. Mr. S. Chaudhuri, learned counsel for the company, stated he did not object to the written statement being amended by adding pleas to enable this contention to be raised but he said he would require an adjournment to consider the new defence, of which previous notice had not been given. I granted an adjournment and later allowed further adjournments to enable the parties to discuss the matters in issue. 2. The suit eventually came before me for disposal on 15th November 1943. The plaint and the written statement have been amended and additional pleadings have been filed by both parties which exhaustively deal with the questions arising between the parties. So far as the plaint is concerned, alternative claims have been made under Ss. 65, 70 and 72, Contract Act, for compensation for the advantages received by the Board under the agreements, for compensation for the benefits the Board enjoyed from the company, and for money paid by mistake, in the event of the agreements not being binding upon the Board and therefore being void. Leave to amend the plaint to include these claims was given on 17th November 1943. When granting leave I appreciated that ante-dating, in effect, these claims might be favourable towards the plaintiff company with regard to the law of limitation but I was satisfied it was just to do so in the circumstances, since they arise solely by reason of the plea by the Board that the agreements are not enforceable against it and which was not indicated before 5th May 1943. If these pleas had been included in the written statement at the time it was filed on 18th December 1941, the company would then have had an opportunity, which I am satisfied it would have utilised, to make the alternative claims earlier but it was prevented from doing so by the Board's failure to raise the question of enforceability until the second day of the trial. In its further written statement, filed on 18th November 1943, the Board alleges that the company has received advantages under the agreements which it should restore, or for which it should pay compensation, under S. 65, Contract Act, in the event of the agreements being void. The Board could have included these pleas in its original written statement and its failure to do so was its own omission and was not occasioned by any default of the company. Consequently I directed that these claims should be treated as having been made on the day the pleading was filed in which they were first raised. On 6th July 1943 the plaintiffs' additional written statement and on 20th November 1943 the plaintiffs' further written statement, were filed. 3. No oral evidence was called and all documents contained in the bundle were agreed between the parties. The following points arise upon the pleadings: Whether the agreements are binding upon Board or are void; whether the guarantees in the agreements are ultra vires; if the agreements are void, (a) when they were discovered to be void, (b) whether the company or the Board or both received from the other advantages under the agreements and should restore or pay compensation for such advantages, (c) whether the Board is bound to compensate the company under S. 70, Contract Act, in respect of anything done by it which it did not intend to do gratuitously, and (d) whether under S. 72 of the same Act the Board should repay to the company money paid by mistake; limitation; and whether the Court has jurisdiction to entertain the suit. Prior to and after the incorporation of the company on 30th July 1903 the Board was negotiating and arranging for the construction and running of a tramway system. After its incorporation the company constructed and has since extended, maintained and conducted the undertaking. About 1904, the tramway was constructed for a distance of about 25 mile from Baraset to Basirhat. About 1907 it was extended to Taki and Hosonabad, about 1909 to Patipukur and about 1915 to Belgatchia. Since the last extension the tramway is about 52 miles in length of which about 33 miles run along the roadways in the Board's area. About 1904, the tramway was constructed for a distance of about 25 mile from Baraset to Basirhat. About 1907 it was extended to Taki and Hosonabad, about 1909 to Patipukur and about 1915 to Belgatchia. Since the last extension the tramway is about 52 miles in length of which about 33 miles run along the roadways in the Board's area. The remaining 19 miles is on land which the company has either acquired or over which it has rights of passage; the Board is not concerned with this 19 miles. During the major portion of the period between 1904 and 1938 the company made substantial profits, part of which (the company alleges amounting to Rs. 5,36,000) was paid to the Board under the provisions in the several agreements to which reference will be made later. In the years ending 1933, 1935 and 1937 the company either incurred losses, or its profits were small, so that, under the provisions of the agreements payments (alleged to amount to about Rs. 69,000) were made by the Board to the company. The original claim in the plaint is for similar payments due from the Board in respect of the years ending in 1939, 1940 and 1941. The decrease in profits or the incursion of losses, it was stated, was occasioned by competitive motor bus services along the tramway route; it was further stated that on account of petrol restriction and other causes arising out of the present war this competition has decreased and in recent years the company has made considerable profits, part of which, if the agreements are not void, would be payable to the Board. These, however, are matters which did not affect the questions and issues in the suit. 4. The firm of Martin & Co., are, and at all times have been, the company's managing agents. At all material times the partners of the firm were Sir Thomas Acquin Martin, Rajendra Nath Mookerjee, Charles Woolard Walsh and Harold Patrick Martin (hereinafter called "the promoters"). Prior to the company's incorporation in 1903, agreements with the Board were made either with the firm or with the promoters as its partners. At all material times the partners of the firm were Sir Thomas Acquin Martin, Rajendra Nath Mookerjee, Charles Woolard Walsh and Harold Patrick Martin (hereinafter called "the promoters"). Prior to the company's incorporation in 1903, agreements with the Board were made either with the firm or with the promoters as its partners. Pursuant to a resolution of the Board dated 9th July 1897, the Board in writing or by advertisement, on 14th July 1897 invited applications for permission to construct and work a steam tramway from Baraset to Basirhat with a branch line to Buduria (this branch was subsequently abandoned.) On 14th August 1897, Martin & Co., wrote a letter to the Board making a full and comprehensive proposal for the construction of the tramway which was to be carried out by a company to be incorporated in the future and they enclosed a draft agreement under which the scheme would be undertaken. At a meeting held on 29th October 1897 the Board accepted Martin & Co.'s proposal subject to a modification to which Martin & Co., subsequently agreed. These terms, with the modification, were included in an agreement dated 14th December 1897 made between the Board and the promoters for and on behalf of a company about to be formed (which in fact subsequently became the plaintiff company.) It is clear that by its resolution at the meeting held on 29th October 1897, the Board approved all the terms contained in the agreement which is one of those alleged not to be binding upon it and to be void. 5. A second agreement, made between the Board and the promoters, dated 14th May 1902, purported to substitute a guarantee clause contained in it, in place of the guarantee in cl. (4) of the first agreement. After the company was incorporated an agreement, dated 3rd August 1903, was made between the Board, the promoters and the company by which the company purported to adopt and to ratify the first agreement, as modified by the second agreement, made between the Board and the promoters. A tramway running between Baraset and Basirhat was constructed by the company acting under the first and second agreements as adopted and ratified by the third agreement. On 6th September 1907, 21st December 1908 and 7th August 1914 further agreements were made between the Board and the company providing for three extensions of the tramway. A tramway running between Baraset and Basirhat was constructed by the company acting under the first and second agreements as adopted and ratified by the third agreement. On 6th September 1907, 21st December 1908 and 7th August 1914 further agreements were made between the Board and the company providing for three extensions of the tramway. The extensions were constructed by the company pursuant to these agreements. The six agreements to which reference has been made, are alleged by the Board not to be binding upon it and to be void on the ground that the Board did not sanction nor execute them as required by the Act and the rules made thereunder. It is now convenient to set out these six agreements and their relevant terms. (1) December 14, 1897 - made between the promoters, for and on behalf of a company about to be formed, and the Board. It was agreed inter alia by cl. (1) that the Board would grant in perpetuity to the company free use of a portion of the roadway not exceeding eight feet in width between Baraset and Basirhat for the purpose of laying and using a steam tramway to be worked by the company; by cl. (4) the Board guaranteed to supplement the net earnings of the company by such annual subsidy as might be necessary to allow it to pay a dividend of 4 per cent. per annum upon its share capital and any surplus profits earned by the company in excess of 4 per cent. on its capital would be equally divided between the Board and the company; by cls. (8), (9) and (10) the company should carry out the works specified therein; by cl. (11) the company should construct, maintain and repair all works connected with the tramway; and by cl. (13) upon adopting the agreement so as to make it binding upon the company the promoters should be discharged from all liability. (2) May 14, 1902-made between the promoters and the Board and expressed to be supplemental to the agreement dated 14th December 1897 (therein called the principal instrument). It was agreed that cl. (13) upon adopting the agreement so as to make it binding upon the company the promoters should be discharged from all liability. (2) May 14, 1902-made between the promoters and the Board and expressed to be supplemental to the agreement dated 14th December 1897 (therein called the principal instrument). It was agreed that cl. (4) in the principal instrument should be eliminated and there should be substituted in its place and be read as part of the principal instrument that the Board guaranteed to supplement the company's net earnings by such annual subsidy as might be necessary to make the net profits of the company equivalent to Rs. 1500 per annum per mile of the tramway system provided that the total liability incurred by the Board in any one year should not exceed the sum of Rs. 38,000 being four per cent. on the amount of the company's share capital, and any surplus profits in excess of four per cent. on its capital earned by the company should be equally divided between the Board and the company. As mentioned above, the company was incorporated on 30th July 1903 after the above two agreements were made. (3) August 3, 1903- made between the Board of the first part, the promoters of the second part and the company of the third part. The two early agreements were recited and it was agreed that the first agreement, as modified by the second agreement, was thereby adopted by the company and should be binding on the Board and on the company in the same manner and to take effect in all respects as if the company had been in existence at the date thereof, and the company thereby ratified the same. The promoters should from thenceforth be discharged from all liability under or in respect of the first agreement. (4) November 6, 1907-made between the Board and the company. The promoters should from thenceforth be discharged from all liability under or in respect of the first agreement. (4) November 6, 1907-made between the Board and the company. It was agreed that, this agreement should be read with and as supplemental to the three earlier agreements; subject to the sanction of the Local Government the Board agreed and consented to the extension of the tramway to Taki and Hosanabad subject to the same terms and conditions as applied to the existing line and as set out in the first and second agreements as if the extension had formed part of the original tramway line and so that the guarantee of the Board as to supplementing the net earnings of the company contained in the first agreement, as modified by the second agreement, should extend and apply so as to render the Board liable to pay a subsidy sufficient to make the net profits of the company equivalent to Rs. 1500 per annum per mile of the extension as well as of the original tramway but subject nevertheless to the maximum of Rs. 38,000 prescribed by the first agreement as modified by the second agreement, and which should apply for the purpose of limiting the contribution in respect both of the original tramway and the extension. (5) December 21, 1908- made between the Board and the company and expressed to be read with and as supplemental to the four earlier agreements. It provided for the extension of the tramway system to Patipukur upon the same terms as the extension in the agreement dated 6th November 1907. (6) August 7, 1914-made between the Board and the company and expressed to be read with and as supplemental to the five earlier agreements. It provided for an extension of the tramway to Belgatchia upon the same terms as in the agreements for the two previous extensions. 6. The above agreements purport to be executed by the Board in the following manner (1) December 14, 1897-by the signatures of the Chairman and two other members of the District Board. The common seal of the Board was not affixed at the foot but is stamped at the head of the document. 6. The above agreements purport to be executed by the Board in the following manner (1) December 14, 1897-by the signatures of the Chairman and two other members of the District Board. The common seal of the Board was not affixed at the foot but is stamped at the head of the document. At the foot it is stated "as witness the hand of the Chairman for the time being of the Board." The signature of the chairman alone is attested; the affixation of the common seal at the head of the document is not attested. (2) May 14, 1902-by the signature of the Chairman and one other member of the Board both of which are attested. The words "as witness the hands of the Chairman and the Vice-Chairman of 24 Perganas" appear at the foot. The common seal of the Board is stamped at the foot of the agreement and also at the head thereof, its affixation is not attested. (3) August 3, 1903-by the signature of the Chairman of the Board with no common seal affixed. by the common seal(4) November 6, 1907 being affixed and by the signatures of(5) December 21, 1908 the Chairman and(6) August 7, 1914 one other member of the Board. 7. The second to the sixth agreements do not bear the signatures of three members of the Board with the common seal affixed. The first agreement bears the signatures of three members of the Board, one of which alone is attested, and the common seal is affixed at the top of the document. The first and second agreements were made before the company was incorporated and by the third agreement the company purported to adopt and to ratify the first, as modified by the second agreement. In order to consider whether the agreements are binding upon the Board reference is required to the material provisions of the Bengal Local Self-Government Act of 1885 (as they appeared prior to 1937) and to a rule made thereunder. They are: Section 20 - Every District Board shall be a body corporate...... and shall have ... a common seal, with power... subject to any rules made by the Local Government under this Act... to contract...... Section 138-It shall be lawful for the Local Government to make rules consistent with this Act, for any District Board... for the purpose... (e) regulating the powers of Boards.... to contract... and shall have ... a common seal, with power... subject to any rules made by the Local Government under this Act... to contract...... Section 138-It shall be lawful for the Local Government to make rules consistent with this Act, for any District Board... for the purpose... (e) regulating the powers of Boards.... to contract... and the mode of executing contracts. 8. On 2nd February 1886 rules were made by the Local Government under S. 138. Rule 103 alone is material; it provides that: Every contract or agreement entered into by any District Board in respect of a sum, or involving in value, above Rs. 500 shall be sanctioned at a meeting, he in writing, be signed by the Chairman and two other members of the District Board, and shall be sealed with the common seal of such District Board. Unless so sanctioned and executed, such contract shall not be binding on the District Board. 9. From the foregoing it appears that the power of the Board to contract which, by S. 2 (h), Contract Act, is to make an enforceable agreement, is under S. 20, subject to rules made by the Local Government under S. 138. Rule 103 requires a contract or agreement to be sanctioned at a Board meeting, signed by three members of the Board and sealed with its common seal and unless so sanctioned and executed, a contract is not binding upon it. Rule 103 is not ultra vires the power of the Local Government to make rules. By S. 138 (d) rules can be made to regulate the powers of a Board to transfer property. In 43 Cal. 790 Mathura Mohan v. Ram Kumar ('16) 3 A. I. R. 1916 Cal. 136 : 43 Cal. 790: 35 I. C. 305 it was held that this power included rule-making power to regulate the mode in which an alienation is to be effected. Section 138 (e) expressly enables the mode of executing contracts to be regulated and therefore, a fortiori, R. 103 must be intra vires the rule-making power of the Local Government. The Board was incorporated under the Act and its provisions govern it. Section 138 (e) expressly enables the mode of executing contracts to be regulated and therefore, a fortiori, R. 103 must be intra vires the rule-making power of the Local Government. The Board was incorporated under the Act and its provisions govern it. When a provision is mandatory and it is a statutory requirement that the contract of a corporation must have its common seal affixed in order to make a binding agreement, in that event the contract is not binding if the common seal is not affixed even when consideration has passed to the corporation: vide (1882) S. A. C. 517 H. Young & Co. v. The Mayor and Corporation of Royal Leamington Spa. (1882) 8 A. C. 517: 52 L. J. Q. B. 713: 49 L. T. 1 : 30 W. R. 500. The same position must arise when any other requirement is not fulfilled, as in this case, by an insufficient number of members of the corporation signing the contract. Rule 103 having been made pursuant to and under the provisions of the Act it has the same effect as the enactments contained in the statute. The second to the sixth agreements were not executed as required by the Act and the Rule, which requirements are mandatory. It must, therefore, follow that none of the second to the sixth agreements is binding upon the Board and cannot be enforced against it. 10. As regards the first agreement, dated 14th December 1897, as mentioned above it is signed by the Chairman and two other members of the Board. The signature of the Chairman alone is attested and the Board's common seal is stamped at the head of the document and there is not the customary attestation that it was affixed in the presence of any officer. A letter, disclosed by the Board, dated 14th December 1897 (the same as that borne by the first agreement) written by the Board to Martin & Co., states that the agreement in duplicate duly signed and sealed was returned with the letter. Rule 103 does not require the seal of the Board to be affixed in any particular place on an agreement nor its affixation to be attested. The letter is evidence that the seal was affixed at the date which the agreement bears. Rule 103 does not require the seal of the Board to be affixed in any particular place on an agreement nor its affixation to be attested. The letter is evidence that the seal was affixed at the date which the agreement bears. There is no reason to doubt that the seal was affixed to, and the three members of the Board signed the agreement in execution of it. In my view, so far as execution is concerned, the first agreement complies with the requirements of R. 103. 11. It was argued, on behalf of the Board, that the first agreement, after it was engrossed, was not placed before the Board for its approval and therefore this agreement does not comply with R. 103 which requires it to be sanctioned by the Board. All the terms contained in the agreement were approved by the Board at its meeting held on 29 October 1897 whereat it was resolved that Martin & Co's tender be accepted subject to a modification, set out in the minutes of the meeting, and which subsequently Martin & Co., accepted, and the modification was included in the agreement. Since the Board had already approved all the terms of the agreement, which subsequently was executed, this approval was their sanction to the agreement. It was unnecessary for the Board to accord its approval a second time by the engrossment being formally placed before it for this purpose. The rule only requires the Board to sanction an agreement, no special form or method of sanction is prescribed. Since it approved all the terms, the Board must have sanctioned the agreement. I am satisfied and I hold that the sanction of the Board was given, which R. 103 requires to be accorded to an agreement. The first agreement is an enforceable contract and is not void for non-compliance with the Rule. 12. There is no evidence, and no record or proceedings of any meeting of the Board, showing that the 2nd, 3rd, 4th, 5th, and 6th agreements, or the terms which they contain, were ever approved or sanctioned by the Board. In regard to these agreements the requirement of R. 103 with regard to sanction was not fulfilled. 12. There is no evidence, and no record or proceedings of any meeting of the Board, showing that the 2nd, 3rd, 4th, 5th, and 6th agreements, or the terms which they contain, were ever approved or sanctioned by the Board. In regard to these agreements the requirement of R. 103 with regard to sanction was not fulfilled. It was contended on behalf of the company that the Board had full authority to enter into the six agreements and that they are binding contracts whatever the form of their execution may have been. Reliance in support of this contention was placed upon S. 79, Bengal Local Self-Government Act, the material provisions of which are: It shall be lawful for a District Board to take measures for, or to contribute towards the construction, repair and maintenance of any works which may directly improve the means of communication within the district...... It was argued that the words "works which may directly improve the means of communication" include a tramway system and the words "to take measures for... the construction, repair and maintenance of any works..." include an implied power to contract for such works to be carried out, and that the works with respect to a tramway can be carried out by the Board or by a company with which the Board contracts and include the works concerned, and the facts and circumstances arising, in the present case. It was further contended that the implied power for the Board to contract under S. 79 is in addition to the express contractual power under S. 20 of the Act (which is subject to the rules made under S. 138) and that in regard to contracts under S. 79 the methods by which the suit agreements were executed are sufficient to bind the Board. It was also argued that the authority under S. 79 to contribute includes power to contract to guarantee upon the terms contained in the agreements. Under Ss. 80, 81 and 82 of the Act the Board has powers, subject to the provisions therein contained, to construct, and maintain tramways, to subscribe to any debenture loan raised by it Government or a municipal or local authority for the construction or maintenance of a tramway system, and to guarantee interest on capital expended on a tramway and other works which may directly improve the means of communication with the district. If S. 79 gave such wide powers, as the learned Advocate-General contended, there would be no need for Ss. 80, 81 and 82. The authority in S. 79 "to take measures for the construction, repair and maintenance of works" must be subject to the express power given in S. 20 to contract, which power is subject to the rules made by the Local Government. The provisions of S. 79 are not exclusive of, but must be read together with S. 20. In my opinion there is no additional separate power contained in S. 79 for a Board to make contracts and it has no authority to enter into binding agreements other than, so far as is material in the present suit, by the mode prescribed in Rule 103. The power under S. 79 to contribute will later be considered. 13. A further question arises with respect to the first, second and third agreements. The first two agreements were made between the Board and promoters prior to the company coming into existence. The third agreement was made between the Board, the promoters and the company (after its incorporation) by which the parties agreed that the first agreement, as modified by the second agreement, was thereby adopted by the company and should be binding on the Board and on the company in the same manner and to take effect in all respects as if the company had been in existence at the date thereof and the company by those presents ratified the first agreement as modified. So far as ratification is concerned, a company, after it comes into existence, cannot ratify an agreement ostensibly made on its behalf before it is incorporated, vide (1867) L. R. 2 C. P. 174, Kelner v. Baxter (1867) L. R. 2 C. P. 174 : 36 L. J. C. P. 94: 15 L. T. 313 : 15 W. R. 278 1904 A. C. 120 Natal Land and Colonization Co. Ltd. v. Pauline Colliery & Development Syndicate Ltd. (1904) 1904 A. C. 120 : 73 L. J. P. C. 22 : 89 L. T. 678 and the observations of Lord Davey at p. 126. A fresh agreement can, however, be made, after the company comes into existence, between the former contracting parties and the company upon the same terms as those contained in the earlier agreement: vide (1904) A. C. 120 Natal Land and Colonization Co. A fresh agreement can, however, be made, after the company comes into existence, between the former contracting parties and the company upon the same terms as those contained in the earlier agreement: vide (1904) A. C. 120 Natal Land and Colonization Co. Ltd. v. Pauline Colliery & Development Syndicate Ltd. (1904) 1904 A. C. 120 : 73 L. J. P. C. 22 : 89 L. T. 678. If the terms are not expressly set out in the new agreement but are ascertained by reference in it to the terms contained in the old one, the new agreement will be of full effect upon the terms in the earlier agreement. The third agreement is a contract between the parties to it by which the company and the Board contracted together upon the terms contained in the first and second agreements. The company cannot enforce these two agreements as they were not parties to them and cannot ratify them since they were made prior to the company's incorporation. The terms contained in the first and second agreements can only be enforced by the company under, and as, the terms of the third agreement and, even assuming that the promoters could have enforced the first two agreements against the Board, the company is unable to enforce the terms in them since the third agreement is not binding upon the Board by reason of its defective execution. 14. The contractual rights of the company against the Board depend upon the enforcibility of the third, fourth, fifth and sixth agreements and since these agreements are not binding upon the Board as they were not executed in accordance with the statutory requirements and also were not sanctioned by the Board, the company cannot succeed in its claim under the agreements for contributions alleged to be due pursuant to the guarantees contained in those agreements. A short reference is necessary to one further contention regarding the agreements, which was made upon S. 31A, Bengal Local Self-Government Act, of which the material provisions are: Subject to the provisions of any rules made under S. 32, the Chairman of a District Board.... shall, for the transaction of the business connected with this Act, .... exercise all the powers vested by this Act in the District Board.... 15. shall, for the transaction of the business connected with this Act, .... exercise all the powers vested by this Act in the District Board.... 15. It was argued that "business" in the section includes anything which the Act empowers the Board to do and it enabled the Chairman to bind the Board when he signed the suit agreements. It is sufficient, in regard to this contention, to point out that S. 31A was inserted in the Act by S. 28, Bengal Local Self-Government (Amendment) Act, 1932, long after the six agreements were made. It was not suggested that the section has retrospective effect and its provisions therefore are not applicable to the agreements in suit. The next matter to be considered is the effectiveness of the guarantee which the Board purported to give. The first claim in the suit is made upon the terms of the guarantee contained in the second agreement and not upon those set out in the earlier agreement. In this respect reference has to be made to Ss. 81 and 82 of the Bengal Act. The provisions of these two sections, as they now appear, are as follows: Section 81. It shall be lawful for a District Board, with the sanction of the Provincial Government to subscribe to any debenture loan raised by the Central Government or any Provincial Government or by any municipal authority or local authority for the construction or maintenance of any railway or tramway which, in the opinion of such District Board, is likely to be of direct benefit to the district. Section 82. It shall be lawful for the District Board, with the sanction of the Provincial Government from time to time to guarantee the payment from the District Fund of such sums as it shall think fit as interest on capital expended on any railways, tramways or other works which may directly improve the means of communication within the district or between the district and other districts. 16. The wording of these two sections has been slightly changed. As regards S. 81, in place of "Provincial Government" the words "Local Government" appeared from 1933 to 1937, and prior to 1932 "Lieutenant-Governor" appeared. 16. The wording of these two sections has been slightly changed. As regards S. 81, in place of "Provincial Government" the words "Local Government" appeared from 1933 to 1937, and prior to 1932 "Lieutenant-Governor" appeared. Prior to 1937 the words "Government of India" appeared in place of "Central Government or any Provincial Government." As regards S. 82, in place of the words "Provincial Government" the words "Lieutenant-Governor" appeared until 1908 and from that date until 1937 the words "Governor General in Council" appeared. Prior to 1907 sanction of the Lieutenant-Governor, and between 1908 to 1937 sanction of the Governor General in Council were required to enable a Board to guarantee interest on capital expended on a tramway. 17. By the guarantee, cl. 4 in the first agreement the Board guaranteed to supplement the net earnings of the company by such annual subsidy as might be necessary to allow the company to pay a dividend of four per cent. per annum upon its share capital of Rs. 7,28,000. At the date this agreement was made the sanction of the Lieutenant-Governor was required under S. 82 in respect of any guarantee coming within it. As mentioned above, this guarantee was changed by the second agreement which substituted in its place a guarantee to supplement the net earnings of the company such by annual subsidy as might be necessary to make its net profits equivalent to Rs. 1500 per mile of the tramway provided that the total liability incurred by the Board in any one year should not exceed the sum of Rs. 38,000, being four per cent. on the amount of the company's share capital. This form of guarantee is also contained in 4th, 5th and 6th agreements and is that upon which the company is suing. The question whether the guarantee in the first agreement is in the form and upon the terms which are authorised need not be considered since it is not the subject of a claim in the suit. 18. The suit guarantee (it is convenient to refer to all guarantees, upon which the company is suing, in the singular as they are in the same form) is to make the annual profits of a trading undertaking equivalent to Rs. 1500 per mile (subject to the limitation of Rs. 38,000 per annum). 18. The suit guarantee (it is convenient to refer to all guarantees, upon which the company is suing, in the singular as they are in the same form) is to make the annual profits of a trading undertaking equivalent to Rs. 1500 per mile (subject to the limitation of Rs. 38,000 per annum). There is no provision in the Act which permits a District Board, whose resources are public funds, to guarantee or to pay to a trading undertaking, any sum to increase its trading profit or to convert its trading loss into a trading profit. The reference to four per cent. on the amount of the company's share capital does not make the guarantee to be in respect of interest on capital expended on the tramway, which S. 82 permits; it is an explanation how the limit of Rs. 38,000 was ascertained. The guarantee is not a provision for a subscription to a debenture loan and, therefore, does not come within the ambit of S. 81. Section 79 of the Act gives a District Board permissive power to contribute towards construction, repair and maintenance of any works which may directly improve the means of communication. It was argued that this section enabled the Board to enter into the guarantee. This section does not empower a guarantee to be given and the power to contribute is limited as stated in the section. The guarantee is not for contribution towards the construction, repair and maintenance of any works and is, therefore, not covered by S. 79. There is not any provision in the Act which either expressly or impliedly empowers the Board to give the guarantee upon which the company is suing, the terms of which are contained in 2nd, 4th, 5th and 6th agreements. In the absence of any authorisation to guarantee or contribute out of public funds towards the trading profits of an undertaking, no guarantee or payment of this kind can be given or made. The position is succinctly summarised in Halsbury's Laws of England (Edn. 2, Vol. In the absence of any authorisation to guarantee or contribute out of public funds towards the trading profits of an undertaking, no guarantee or payment of this kind can be given or made. The position is succinctly summarised in Halsbury's Laws of England (Edn. 2, Vol. 8 at p. 73) in which it is stated "what the statute does not expressly or impliedly authorise is to be taken to be prohibited." Reference is now required to the material part of S. 3, Bengal Tramways Act of 1883, as it was enacted in 1903; it is as follows: An order made by the Local Government authorising the construction of any tramways.... may be obtained by.... any persons, corporation or company with the consent of such local authority.... Section 5 of the same Act enables the Local Government to consider an application for such an order and to grant it. On 15th May 1903, through its Railway Department, the Local Government made an order under the Tramways Act authorising the construction of the tramway system. This order was passed before the incorporation of the company. Clause 5 of the order provides that the promoters shall construct and maintain.... subject to the agreements made between the promoters and the Local Authority (defendant Board) which are set forth in the first schedule attached to this order.... the tramway hereinafter described.... By cl. 4 of the order the expression "the promoters" include the company to be formed and on whose behalf the application was stated to be made. No point is made that the order did not authorise the company to carry out its effect. The first suit agreement dated 14th December 1897 alone is given in the schedule to the order. The terms of the agreement are fully set out save that, in place of the original guarantee in cl. 4, the terms of the guarantee contained in the second agreement are given as if they formed part of the first agreement. Since the order authorising the tramway construction was made subject to the agreement set out in the schedule to the order, the Local Government must have approved and sanctioned the terms of the agreement, including the Board's guarantee to the company. Since the order authorising the tramway construction was made subject to the agreement set out in the schedule to the order, the Local Government must have approved and sanctioned the terms of the agreement, including the Board's guarantee to the company. It was contended on behalf of the Board that, since the order was made and the sanction for the guarantee was given under the Tramways Act and not under the Bengal Local Self-Government Act, this is not sanction under the latter Act and the guarantee has not been accorded the sanction which the statute requires. 19. Section 82 of the Act which alone enables a guarantee to be given, does not specify any particular form or method by which sanction should be accorded but requires only that sanction should be given. If the form or method by which approval or sanction was given were the only point arising I should have been inclined to the view that, assuming the guarantee came within S. 82, it was effectively sanctioned although this is contained in an order made under the Tramways Act. The matter, however, does not rest there. The order dated 15th May 1903 was made by the Local Government by whom sanction was therefore given to the guarantee. Sanction under S. 82 was required to be given by the Lieutenant-Governor and not by the Local Government at the dates when the first and second agreements were made, and sanction by the Local Government is not sanction by the Lieutenant-Governor. The Lieutenant-Governor nev(sic) (sic)gave his sanction either for the guarantee contained in the first, or in the second agreement. In the absence of the Lieutenant-Governor's sanction the guarantee, upon which the company is suing, is ineffective and cannot be enforced. The 4th, 5th and 6th agreements, dated respectively 6th November 1907, 12th December 1908 and 7th August 1914, provide for extensions of the tramway, and contain guarantees by the Board similar to that in the second agreement. At the date of the fourth agreement the sanction of Lieutenant-Governor was required; when the fifth and sixth agreements were made, the sanction of the Governor-General in Council was necessary to enable a Board effectively to give a guarantee authorized under S. 82. At the date of the fourth agreement the sanction of Lieutenant-Governor was required; when the fifth and sixth agreements were made, the sanction of the Governor-General in Council was necessary to enable a Board effectively to give a guarantee authorized under S. 82. No sanction was given either by the Lieutenant-Governor or by the Governor-General in Council, as the case may be, to any of the guarantees and the absence of such sanctions renders them ineffective. Before proceeding further it is convenient to summarise the conclusions to which I have arrived upon the matters which have been discussed: (1) The guarantees, as they appear in the second, fourth, fifth and sixth agreements, and upon the terms of which the plaintiff company's claim is made under the agreements, are not authorized by the Act. (2) Even assuming the guarantees are covered by S. 82, none has been sanctioned by the specified authority. (3) The second, third, fourth, fifth and sixth agreements were not sanctioned or executed by the Board as required by the Act and rule and therefore they are not binding upon and not enforceable against the Board. (4) Although the first agreement complied with the statutory requirements regarding sanction and execution, the company was not in existence at the time it was made, was not a party to it and therefore cannot enforce it; also it cannot enforce the second agreement for the same reasons. (5) The third agreement, by which the company purported to make a new agreement with the Board upon the terms contained in the first agreement as modified by the second agreement, being unenforceable the company cannot enforce the terms of the earlier agreements as the terms of the third agreement. 20. Since the third, fourth, fifth and sixth agreements (which the company might enforce as parties to them) are not binding upon the Board and are not enforceable against it, they are therefore void, vide S. 2 (g), Contract Act, and they always have been void. The second agreement also is, and at all times, was void for the same reasons. Since the third, fourth, fifth and sixth agreements, upon which the plaintiff company makes the original claim in the suit, are not binding upon and enforceable against the Board, it follows that this claim by the company must fail. The second agreement also is, and at all times, was void for the same reasons. Since the third, fourth, fifth and sixth agreements, upon which the plaintiff company makes the original claim in the suit, are not binding upon and enforceable against the Board, it follows that this claim by the company must fail. The agreements being void, reference is now required to the provisions of three sections of the Contract Act. They are: Section 65-When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it to the person from whom he received it. Section 70-Where a person lawfully does anything for another person, or delivers anything to him, not intending to do so gratuitously, and such other person enjoys the benefit thereof, the latter is bound to make compensation to the former in respect of, or to restore, the thing so done or delivered. Section 72 - A person to whom money has been paid, or anything delivered, by mistake or under coercion, must repay or return it. 21. In para. 13 of the amendment to the plaint the company claims, under S. 65, for compensation totalling Rs. 35,36,072 in respect of the advantages (therein specified) which it alleged the Board received under the void agreements. In paras. 9 and 10 of its further written statement the Board alleges that the company, in its turn, received advantages from the Board which are therein set out and which it contends the company is bound to restore or in respect of which payment should be made; the value of such advantages is said to amount to over Rs. 41,00,000. Further the company claims, in the alternative, in para. 14 of the amendment of the plaint Rs. 30,00,000 under S. 70 and, in para. 15, Rs. 5,36,072 under S. 72. Considerable argument was directed as to the alleged advantages; whether the advantages were received by one party from the other; the dates when it should be deemed the agreements were discovered to be void; the relevant Articles of the Limitation Act which should apply to these claims; and the dates from which limitation should commence. 5,36,072 under S. 72. Considerable argument was directed as to the alleged advantages; whether the advantages were received by one party from the other; the dates when it should be deemed the agreements were discovered to be void; the relevant Articles of the Limitation Act which should apply to these claims; and the dates from which limitation should commence. After the conclusion of all arguments referable to the several claims and the matters arising out of and in connection therewith, objection was taken on behalf of the Board to the jurisdiction of this Court in respect of claims made in the amendment to the plaint. At the time when the question of amendment arose and when leave was given on 17th November 1943, for the amendment to be made, the question of jurisdiction was not raised, this took place on 24th November. But jurisdiction which the Court does not possess cannot be conferred by a party postponing to take the objection and unless there is jurisdiction in the Court, it has none to exercise. 22. The defendant Board neither resides nor carries on business within the jurisdiction and it is common ground that only part of the causes of action, whether the original or by amendment, arose within the jurisdiction and that leave of the Court is required before the Court can entertain any of the claims in the suit. Leave was obtained under Cl. 12 of the Letters Patent to institute the suit at the time when the only claim made was under the agreements. So far as this claim is concerned, and it has not been argued to the contrary, the Court has jurisdiction to entertain it. By the amendment, the company, in the alternative, claims relief under Ss. 65, 70 and 72, Contract Act. Under these sections claims are made upon the basis, and in the event of the suit agreements being void. These alternative claims are not, as was argued, different forms of relief in respect of the cause of action originally contained in the plaint, but each is a fresh cause of action for which leave is required under Cl. 12. The original claim is under the written agreements whereas the other claims are made under statutory enactments and which are alleged to arise upon the failure of the first claim by reason of the agreements being void. 12. The original claim is under the written agreements whereas the other claims are made under statutory enactments and which are alleged to arise upon the failure of the first claim by reason of the agreements being void. The first claim is to enforce the terms of the agreements but the other claims are dehors the agreements and seek to enforce other rights. Leave under Cl. 12 is a condition precedent to jurisdiction and unless this condition is fulfilled the Court has no jurisdiction to entertain a suit for which leave is required. The material provisions of the clause are ... the said High Court of Judicature at Fort William in Bengal... shall be empowered to receive, try, and determine suits of every description if... the cause of action shall have arisen, either wholly, or, in case the leave of the Court shall have been first obtained, in part, within the local limits of the ordinary original jurisdiction of the said High Court.... Jurisdiction is conferred to receive, try, and determine suits provided the leave of the Court is previously obtained when the cause of action arises in part within the territorial limits. Leave must be obtained before the suit can be received. In 15 Bom. 93 Rampurtab Samruthroy v. Premsukh Chandamal ('91) 15 Bom. 93 it was held that the grant of leave is a judicial act relating solely to the cause of action set forth in the plaint at the time it was obtained, it affords the very foundation for jurisdiction and is not available to confer jurisdiction in respect of a different cause of action which was not considered at the time; and subsequently the plaint cannot be amended so as to alter the cause of action; the Court cannot try a different cause of action save in another suit. In Motilal Tribhovandas Choksey Vs. Shankarlal Chhaganlal, AIR 1939 Bom 345 it was held that when a suit was instituted with leave under Cl. 12 by several persons as partners and by amendment of the plaint was converted into a suit by only one of them, the cause of action is altered and does not lie in the absence of fresh leave. Shankarlal Chhaganlal, AIR 1939 Bom 345 it was held that when a suit was instituted with leave under Cl. 12 by several persons as partners and by amendment of the plaint was converted into a suit by only one of them, the cause of action is altered and does not lie in the absence of fresh leave. In the course of his judgment Kania J. observed that if an amendment altering the cause of action is made it follows that fresh leave should be obtained in respect of the altered cause of action. Upon this authority it was contended that in the same suit, for which leave has previously been obtained, fresh leave can be given in respect of a new cause of action introduced by an amendment. Leave to amend the plaint was given on 17th November 1943. The plaint with the amendment was presented on 22nd November without verification. On 24th November the question of jurisdiction was argued upon which date I was asked to give leave under Cl. 12 to the claims in the amendment. The amendment was verified on 25th November. Reference was made to 43 C. W. N. 1015 Amullya Chandra Ghose v. Suprokash Chandra Mitra ('39) 43 C.W.N. 1015 to support the application for leave to the amendment. In this suit Lort William J. by way of obiter, observed that according to the practice on the Original Side of this Court in cases where leave under Cl. 12 of the Letters Patent has been granted, a suit is deemed to be instituted on the date of the presentation of the plaint and not on the date when leave is obtained. The learned Judge's observations were directed upon the question of limitation and he did not say that leave could be granted after a suit has been instituted. 23. The wording and meaning of Cl. 12 is clear, namely, that the Court's leave shall previously be obtained before it has jurisdiction to receive a suit for which leave is required. The grant of leave is a condition precedent to the Court having jurisdiction to receive a suit. An amendment to a plaint raising a new cause of action upon which a claim is made is not a fresh suit but is an additional claim made in an existing suit. The grant of leave is a condition precedent to the Court having jurisdiction to receive a suit. An amendment to a plaint raising a new cause of action upon which a claim is made is not a fresh suit but is an additional claim made in an existing suit. The Court's leave is previously required in respect of a cause of action before the Court can have jurisdiction to receive the suit in which it is alleged. Further, in the present case leave to sue was not sought with respect to the causes of action in the amendment either at the time application was made to amend or when leave was given for the amendment or when the plaint with the amendment was presented to the Court. I do not consider that postponement of verification affects the position. My attention was not called to the authorities and the question of leave being required in respect of the amendment was not raised when I granted leave to amend the plaint. But this omission and the grant of leave to amend the plaint cannot confer upon the Court jurisdiction which it does not possess. 24. In my opinion the Court has no jurisdiction to receive, try and determine the claims upon the causes of action in the amendment to the plaint since leave was not previously obtained in respect of those causes of action before the suit in which they are made was instituted in this Court. Learned counsel for the Board conceded that if the Court has not jurisdiction in this suit to entertain the company's claims to compensation under S. 65, Contract Act, then it must follow it has no jurisdiction to consider similar claims by the Board. The question of jurisdiction does not affect the claim made by the company under the agreement. There is no doubt the Court has jurisdiction to entertain this claim. I have already indicated that this claim must fail and it is therefore dismissed. In light of the conclusion to which I have arrived regarding jurisdiction, the alternative claims raised in the amendment to the plaint must fail in the present suit but in dismissing them I do so without prejudice to, and, if necessary, with liberty for, the plaintiff to prefer them in a fresh suit. In light of the conclusion to which I have arrived regarding jurisdiction, the alternative claims raised in the amendment to the plaint must fail in the present suit but in dismissing them I do so without prejudice to, and, if necessary, with liberty for, the plaintiff to prefer them in a fresh suit. There will also be liberty for the Board to make its claims under S. 65, Contract Act, in a fresh suit. Ordinarily it is desirable for a Judge to express his views upon all matters in issue arising in a suit although his opinion may not be necessary for the decision since he may have disposed of the suit upon one issue, for example, limitation. In the present suit I do not consider that this course is proper. The claims by the company under Ss. 65, 70 and 71, Contract Act, and by the Board under S. 65 may be the subject of future litigation. In these circumstances, and as I am unable to dispose of these claims myself, it is most desirable that all issues should be at large between the parties and that the Court before which they may come should be unfettered to determine all questions arising in connection with them. I propose, therefore, not to express any opinion upon the issues or upon any matters relating to the claims under the above sections of the Contract Act, including the dates when the suit agreements were discovered to be void and with respect to the law of limitation. Eleven issues were settled, which will be attached to the pleadings. I express no opinion with regard to issues 5 to 10 inclusive. 25. In regard to costs: In the ordinary course the plaintiff's suit having failed the usual consequences would follow. There are, however, in this case some special circumstances. The first adjournment was granted by reason of the validity of the suit agreements being raised by the Board for the first time on the second day of the hearing. Further, not inconsiderable time was occupied with regard to the advantages which, in para. 9 of the Board's further written statement, it is alleged were received by the company and the recoverability by the Board in respect of those advantages, and which cannot be decided in the present suit. Further, not inconsiderable time was occupied with regard to the advantages which, in para. 9 of the Board's further written statement, it is alleged were received by the company and the recoverability by the Board in respect of those advantages, and which cannot be decided in the present suit. It is not possible to allocate the period of time which was occupied in dealing with the argument upon the matters set out in the Board's further written statement but I do not consider that the company bear the costs in respect of these matters or of the adjournment which was occasioned by the Board. Upon consideration I have come to the conclusion that the proper order to make is that each party should respectively bear its own costs. It is with regret that I have been forced to hold that the suit agreements are not binding upon, and enforceable against the Board, and that they are void. During a period of about 40 years the tramway system has been maintained within the area of the defendant Board resulting in considerable profit not only to the company but also to the Board; it must also have been a great boon and benefit to members of the public. It is unfortunate that after the lapse of this long period the District Board has been successful in contending that it is not bound by the agreements which it made and pursuant to which the tramway has been conducted for so many years and has provided cheap and useful amenities for the public.