JUDGMENT Misra, J. - The plaintiff-appellant, Bhowra Kankanee Collieries Ltd. and another brought a suit for permanent injunction restraining defendant no. 1 from purchasing coal from any other source than the plaintiff. The plaintiff sought the above relief on foot of a covenant in the lease. The original lease, dated the 18th of December, 1900, was granted by the Raja of Jharia to the Eastern Coal Company, pro forma defendant no. 2. It was a mining lease and defendant no. 2 erected several plants including coke plants and also put up various types of buildings for accommodation of the employees. Defendant no. 2 sold the plants etc. to defendant no. 1, Sunil Kumar Roy, who is respondent no. 1 to this appeal. Respondent no. 1 carried on the manufacture of coke in the name of Bhowra Coke Production Company. On the 17th of May, 1946, the Eastern Coal Company (defendant no. 2) gave a lease of the leasehold property to defendant no. 1. There was a term in the lease that whatever coal would be required by defendant no. 1 for the manufacture of coke would be supplied by the lessor, if the lessor would have suitable coal for the purpose. The Eastern Coal Company had four neighbouring collieries being Bhowra, Pootkee, Kankanee and Amlabad. It may be stated that the plaintiff company was incorporated with the object of acquiring the four collieries of the Eastern Coal Company together with the valuable right of the said proprietor as also the right that defendant no. 1 would have to purchase coal from the plaintiff in accordance with the term incorporated in the lease granted to defendant no. 1 by the Eastern Coal Company. The plaintiff entered into possession of the leasehold property on the 1st of January, 1955. Defendant no. 1 continued to pay lent and royalty and also to (Sic) supply coal from time to time. Thus defendant no. 1 expressly attorned to the plaintiff. In November, 1955, trouble arose between the plaintiff and this defendant as the latter said that he would not take the plaintiff's coal. This was a direct violation of the term of the lease and thus the plaintiff brought the present suit on the 1st of December, 1955.
Thus defendant no. 1 expressly attorned to the plaintiff. In November, 1955, trouble arose between the plaintiff and this defendant as the latter said that he would not take the plaintiff's coal. This was a direct violation of the term of the lease and thus the plaintiff brought the present suit on the 1st of December, 1955. It may also be stated here that although the plaintiff entered into possession on the 1st of January 1955, a registered deed of sale was executed by the Eastern Coal Company in favour of the plaintiff on the 28th of September, 1957. 2. The defendant pleaded in the written statement that the plaintiff had no title on the date of the suit and hence the plaintiff could not maintain the present action. No other infirmity in the plaintiff's title was pleaded originally in the plaint but in course of argument it was urged that the transfer was in contravention of the Mineral Concession Rules and, as such, the plaintiff did not acquire any title from the Eastern Coal Company and the suit was fit to be dismissed on this ground alone. But the further plea raised was that there was irregular supply by the plaintiff and that the quality of the coal was extremely low and it was not fit for manufacture of coke which required coal of the standard quality. Hence the defendant could not be restrained from getting its supply from other sources. 3. The finding of the Trial Court on a consideration of the evidence adduced by the parties was that although initially the plaintiff's title was defective when the suit was instituted, the defect was removed when a regular registered deed of sale was executed in favour of the plaintiff on the 28th of September, 1957. The Court could take note of the subsequent event and, as such, the plaintiff's suit could not be dismissed on this ground. On the second ground urged in support of the defence plea that the plaintiff acquired title in contravention of the Mineral Concession Rules, the Trial Court held that the Rule was not contravened.
The Court could take note of the subsequent event and, as such, the plaintiff's suit could not be dismissed on this ground. On the second ground urged in support of the defence plea that the plaintiff acquired title in contravention of the Mineral Concession Rules, the Trial Court held that the Rule was not contravened. The court of appeal below also affirmed the finding of the learned Subordinate Judge on both the grounds except that, according to the learned District Judge, Rule 37 of the Mineral Concession Rules was no doubt, violated but it would not affect the validity of the transaction, so that the plaintiff's title was perfected. As to the ground urged on behalf of the plaintiff that defendant no. 1 was estopped from challenging the plaintiff's title under Section 115 of the Evidence Act as the defendant acted on the term of the lease, paid rent and royalty to the plaintiff and also purchased the necessary coal from the plaintiff, the Trial Court held in favour of the plaintiff to the effect that there was estoppel against defendant no. 1 from pleading any defect in the title of the plaintiff. The learned District Judge, on appeal, however, reversed this finding on the ground that it could not operate as a bar in the way of the defendant raising this question, because the payment was made in ignorance of the legal position. Hence, it could not operate as an estoppel. The Trial Court, however, dismissed the suit holding that this term of the lease that defendant no. 1 had to obtain his supply of coal from the collieries of the plaintiff for manufacture of coke could not succeed because this term was so uncertain that the Court passing a decree could not enforce the execution of this term of the decree. As such specific performance of this term would not be allowed, and if the specific performance of the term could not be allowed, the injunction also could not be granted.
As such specific performance of this term would not be allowed, and if the specific performance of the term could not be allowed, the injunction also could not be granted. The learned District Judge also, on appeal, came to the same conclusion and held that this covenant of the lease was not the one that could be specifically enforced, because it was a contract going into such minute details that the Court could not supervise the execution of the decree and hence in terms of Section 21 (c) of the Specific Relief Act it was not enforceable by the grant of specific performance. It was also a contract that would require compliance and control for a period of more than three years and hence it was also hit under Section 21 (g) of the Specific Relief Act. The learned District Judge also relied upon Section 56 of the Act for upholding the dismissal of the suit on the ground that when the terms of the contract could not be specifically enforced, no injunction could be granted. It was urged further that it was true, no doubt, that where a contract contains both positive and negative covenants, even where the positive covenant could not be enforced the negative stipulation whether express or implied can be enforced provided it is capable of being enforced. In the present case the negative covenant also could not be enforced and hence the suit could not be decreed. 4. Learned counsel for the plaintiff has endeavoured to reopen the question of estoppel and urged that the learned District Judge was in error in holding that defendant no. 1 was not estopped from challenging the plaintiff's title. He has drawn my attention to the principle of attornment between landlord and tenant and has contended that where the lessee after having purchased with full knowledge of the title of the transferee and the lessor's right, pays rent and royalty to the lessor's transferee this would amount in law to attornment and the lessee would not be permitted to deny the title of the transferee of his lessor.
The view of the learned District Judge that the defendant did so in ignorance of the above defects in the title of the plaintiff is not cogent ground for negativing the plaintiff's plea of estoppel because the plaintiff was put into possession in part performance of the contract for transfer of the lessor's right and a registered deed of sale was executed subsequently. The defendant must be deemed to have knowledge of this defect and if he paid rent and royalty to the plaintiff, he could not be permitted to turn round and challenge the title in course of the present litigation. In my opinion, however, the view of law on the basis of which the learned District Judge acted cannot be regarded as incorrect inasmuch as the plaintiff was put into possession of the leasehold property by the Eastern Coal Company and the defendant might well have been under the impression that there was a regular transfer of title in his favour by the Eastern Coal Company. Here, the learned District Judge is correct that where attornment is made in ignorance of the legal position, the tenant, or for the matter of that, the lessee cannot be fastened with the liability arising under the doctrine of attornment which implies conscious act on the part of the tenant in acknowledging the title of the transferee from the landlord, vide Woodfalls Law of Landlord and Tenant at P. 902 (25th Edition) which contains the following passage. "The rule that a tenant may not dispute landlord's title applies only to the title of the original landlord who let him in and not to that of an assignee of the reversion and such title may be disputed by a tenant. But if the tenant has paid rent to the claiming assignee of the reversion of his agent, such payment is prima facie evidence of the title of the assignee, and the tenant except in a case of fraud or misrepresentation can only defeat that title by showing that he paid in ignorance......" 5.
But if the tenant has paid rent to the claiming assignee of the reversion of his agent, such payment is prima facie evidence of the title of the assignee, and the tenant except in a case of fraud or misrepresentation can only defeat that title by showing that he paid in ignorance......" 5. As to the question raised in the courts below that the plaintiff's title was defective because it was acquired in violation of the Mineral Concession Rules, 1949, it has been held that the relevant rule applicable to the facts of this case is Rule 37 which, however, would not hit the transfer in favour of the plaintiff by the Eastern Coal Company. This rule provides as follows:- "The lessee may, with the previous sanction of the State Government and subject to the conditions specified in the first proviso to Rule 35 and in Rule 38, transfer his lease or any right title or interest therein, to a person holding a certificate of approval on payment of a fee of Rs. 100/- to the State Government." The proviso which was added by Notification No. M. II-159 (7)/54, dated the 21st December, 1954, stands thus; "Provided that no mining lease or any right, title or interest therein in respect of any mineral specified in Schedule IV shall be so transferred except with the previous approval of the Central Government." It has been contended that although in this case the sanction of the State Government was obtained, the previous approval of the Central Government was not obtained in respect of this mineral which is specified in Schedule IV. It is true, no doubt, that in the present case no extraneous evidence was brought on record to establish whether the sanction of the State Government was taken prior to the transfer of title by defendant no. 2 in favour of plaintiff no. 1 and, likewise, whether the approval of the Central Government was obtained as laid down in the proviso, but the learned District Judge referred to the recital in the deed of transfer itself (Exhibit 8) to the effect that letter no. 1R-Mining-30224/56-158R, dated the 7th January, 1957, addressed by the Under-Secretary to the Government of Bihar, Revenue Department, to the Deputy Commissioner, Dhanbad, which was sent to the transferor by the District Mining Officer, Dhanbad, with his memo no.
1R-Mining-30224/56-158R, dated the 7th January, 1957, addressed by the Under-Secretary to the Government of Bihar, Revenue Department, to the Deputy Commissioner, Dhanbad, which was sent to the transferor by the District Mining Officer, Dhanbad, with his memo no. 137/M, dated the 9th January, 1957, disclosed that sanction under Rule 37 of the Mineral Concession Rules, 1949, to transfer the coal mine and premises had been accorded. This will be taken to be reliable material to show that the State of Bihar did accord the required sanction to the transferor to transfer the coal mine and premises covered by this deed to plaintiff no. 1. The deed of transfer (Exhibit 8), however does not give any indication that this transfer was made with the previous approval of the Central Government. The learned District Judge has also referred to the fact that no such submission was made before him by learned counsel even for plaintiff no. 1 that the approval of the Central Government was obtained in regard to the transfer of right to extract coal which is covered by the proviso to this rule. The learned District Judge accordingly held that although the prior sanction of the State Government must be presumed to have been granted, the deed of transfer still suffered from the defect that the necessary certificate of approval by the Central Government was not granted in this case. 6. The learned District Judge has nevertheless on a consideration of the relevant rules on the point has come to the following conclusion: "On a consideration of the above aspects I hold that the provisions of neither Rule 37 nor Rule 48 of the Mineral Concession Rules has any bearing whatsoever in determination of the rights of transferability of the leasehold interest which was originally held by defendant no. 2 and it follows, therefore, that the validity of the transfer of this leasehold interest as made by defendant no. 2 in favour of plaintiff no. 1 is not affected in any way by the alleged contravention of the provisions of Rule 37 of Mineral Concession Rules, 1949. It follow, therefore, that plaintiff no. 1 has acquired a valid title to the leasehold interest by virtue of the transfer made in his favour by defendant no. 2 and the contention regarding the non-maintainability of the suit owing to the alleged defect in the title of plaintiff no. l cannot be accepted.
It follow, therefore, that plaintiff no. 1 has acquired a valid title to the leasehold interest by virtue of the transfer made in his favour by defendant no. 2 and the contention regarding the non-maintainability of the suit owing to the alleged defect in the title of plaintiff no. l cannot be accepted. The contention regarding the non-maintainability of the suit is accordingly rejected and this decides point no. 1." The reasoning of the learned District Judge which has been challenged before us by learned counsel for the appellant is that although there is provision in Rule 37 for according previous approval by the Central Government, no penalty is provided in the rule as to what would be the effect of the validity of such a transfer where the required previous approval has not been given. Rule 53 of the Rules which refers to the penalty for violation of any of the provisions of the Rules says: "If any person grants or transfers or obtains a prospecting licence or a mining lease or any right, title or interest therein in contravention of any of the provisions of this Chapter or acts in contravention of the provisions of Rule 51A, he shall be punishable with imprisonment which may extend to six months, or with fine which may extend to one thousand rupees, or with both." Rule 54 also deals with the penalty for failure to furnish returns etc. This, however, relates to Chapter V of the Rules dealing with the grant of mineral concessions by private persons. Rule 37, however, which falls in Chapter IV, does not contain any such penal clause and as such it should be taken that no penalty has been attached to any such violation. It is true, no doubt, that the Mineral Concession Rules, 1949, were framed under the Mines and Minerals (Regulation and Development) Act, 1948, but under Section 29 of the Mines and Minerals (Regulation and Development) Act, 1957, these rules were kept alive. This Act came into operation from the 1st of June, 1958, after the execution of Exhibit 8 (the deed of transfer) which was executed on the 28th of September, 1957. The validity of this deed of transfer must, therefore, be judged strictly in accordance with the provisions of Rule 37 of the Mineral Concession Rules, 1949, issued under the Act, of 1948.
The validity of this deed of transfer must, therefore, be judged strictly in accordance with the provisions of Rule 37 of the Mineral Concession Rules, 1949, issued under the Act, of 1948. No doubt, Sub-section (1) of Section 4 of the Act provides that no mining lease could be granted after the commencement of this Act otherwise than in accordance with the provisions of these Rules and Sub-section (2) of this section was also to the effect that any mining lease granted contrary to the provisions of Sub-section (1) must be held to be void and of no effect. Thus, Section 4 of this Act would affect the validity only of those leases which were granted after this Act came into force and not to leases granted prior to its coming into force. Section 7 of the Act also made provision that the Central Government might by notification in the official gazette, make rules for the purpose of modifying or altering the terms and conditions of any mining lease granted prior to the commencement of this Act--thus bringing such leases into conformity with the rules made under Sections 5 and 6. Although the Central Government was authorised to make such rules, no such rules were in fact made by the Central Government and as such the power which was granted to the lessee by the lessor to make the transfer of the leasehold interest to a third person was not affected. The restriction imposed in Rule 37 in regard to a mining lease in respect of land in which the minerals belonged to Government and the corresponding Rule 48 in Chapter V in regard to the grant of mineral concessions by private persons would not, therefore, apply to leases which were created prior to the coming into force of the Mines and Minerals (Regulation and Development) Act, 1948. The learned District Judge has also referred to the provisions of Rules 26 to 36 and has concluded that the restriction of Rule 37 would apply only to leases created in terms of these rules and the right of transferability of a lease governed by Rule 37 would only apply to such leases created after the coming into force of these rules and not to leases which came into existence prior to these rules.
Reference has also been made to Sub-section (1) of Section 16 of the Mines and Minerals (Regulation and Development) Act, 1957, which lays down that all mineral leases granted before the 25th day of October, 19.9, shall be brought into conformity with this Act. But Section 30A of the Act provides that notwithstanding anything contained in this Act, the provisions of Sub-section (1) of Section 9 and Sub-section (1) of Section 16 shall not apply to or in relation to a mining lease granted before the 25th of October, 1949, in respect of coal, but the Central Government, if it is satisfied that it is expedient so to do, may by a notification made in the official gazette, direct that an or any of the said provisions (including any rules made under Sections 13 and 18) shall apply to or in relation to such leases subject to such exception and modifications, as may be specified in the notification. Section 30A, therefore, makes a clear exception, so far as the applicability of the provisions of this Act and also of the Act of 1948 indirectly are concerned, with regard to the leases in respect of coal, and the terms and conditions of such leases are not to be brought into conformity with this Act unless and until a notification is issued by the Central Government in accordance with Section 30A of this Act. It is clear, therefore, that Rule 37 of the Act of 1948 will not govern the terms and conditions of the lease granted to defendant no. 2 by the Jharia Raj as this lease came into existence in the year 1900, long before the enactment of the Mines and Minerals (Regulation and Development) Act, 1948, as also the Act of 1957. The decisions of this Court in the case of (1) Smt. Sudha Devi.
2 by the Jharia Raj as this lease came into existence in the year 1900, long before the enactment of the Mines and Minerals (Regulation and Development) Act, 1948, as also the Act of 1957. The decisions of this Court in the case of (1) Smt. Sudha Devi. V. State of Bihar (A.I.R. 1956 Patna 506) and (2) Baijnath Sharma V. State of Bihar (A.I.R. 1959 Patna 243) cited before the learned District Judge and also placed before us by learned counsel were distinguished on the ground that in Sudha Devi's case the lease was granted by the State Government after the Act came into force and in the latter case it was held that the State Government had no right to grant any mining lease in anticipation of this order of the Central Government, and as such an order passed by the State Government would be beyond its authority and in contravention of Rule 37 and, therefore, illegal and void. In my opinion, the reasoning of the learned District Judge is correct and it is a clear case in which, in view of Section 30A of the Mines and Minerals (Regulation and Development) Act and in the absence of any notification by the Central Government it must be held that the right of transfer which has been conferred upon the lessee under Exhibit 8 could not be affected by either Rule 37 or Rule 48 of the Mineral Concession Rules. 7. Mr. Lal Narain Sinha has raised a question in this Court, which was not raised on behalf of the defendant in the courts below that the title of the plaintiff must be held to be extinguished after the vesting of the estate in the State of Bihar under Section 4(a) of the Bihar Land Reforms Act. In accordance with the provisions of this section the right of the intermediary in regard to the mining lease granted by him must be held to have vested in the State of Bihar. Section 10 saves the right of the holders of subsisting leases of mines and minerals from being affected by the provisions of Section 4(a).
In accordance with the provisions of this section the right of the intermediary in regard to the mining lease granted by him must be held to have vested in the State of Bihar. Section 10 saves the right of the holders of subsisting leases of mines and minerals from being affected by the provisions of Section 4(a). Section 10A, however, which has been newly incorporated by Bihar Act 4 of 1965 lays down as follows:- "10-A. Vesting of interest of lessee of mines or minerals which is subject to a sub-lease.--(1) The interest of every lessee of mines or minerals which is subject to a sub-lease shall, with effect from such date as may be notified in this behalf by the State Government in the official gazette, vest in the State and thereafter the sub-lessee whose lease is not subject to any further sub-lease shall hold his lease directly under the State Government and the provisions of Sub-sections (2) and (4) of Section 10 shall, mutatis mutandis, apply to his lease. (2) No sub-lessee of mines or minerals holding under a lessee whose interest vests in the State Government under Sub-section (1) shall be entitled to claim any damages from his lessor on the ground that the term of the lease in respect of the mines or minerals have become incapable of fulfilment by the operation of this section." The right of the plaintiff also to realise any rent or royalty from defendant no. 1 would be extinguished because the plaintiff is not carrying on any mining operation in so far as the right enjoyed by defendant no. 1 is concerned. Since the defendant-respondent is a sub-lessee under the plaintiff who acquired the right of the Eastern Coal Company (the original lesee), the right of the plaintiff also must be held to have been extinguished as having vested in the State of Bihar. Mr. Lal Narain Sinha has however, contended, that after the grant of right by the Eastern Coal Company in favour of defendant no. 1 for manufacture of coke out of the coal to be supplied by the Eastern Coal Company, the latter would be treated as the landlord in relation to defendant no.
Mr. Lal Narain Sinha has however, contended, that after the grant of right by the Eastern Coal Company in favour of defendant no. 1 for manufacture of coke out of the coal to be supplied by the Eastern Coal Company, the latter would be treated as the landlord in relation to defendant no. 1 and, in that view of the matter, the Eastern Coal Company or for the matter of that, its transferee, (plaintiff) would be in the position of a landlord and this right also would be extinguished in terms of Section 10A of the Bihar Land Reforms Act. This contention also must be overruled as devoid of any force because the grant in favour of defendant no. 1 by the Eastern Coal Company is in the nature of transfer of buildings etc., which were erected by the Eastern Coal Company, together with the plant and machinery for manufacture of coke out of the coal to be supplied by the Eastern Coal Company, but it did not confer any right to extract coal which can be regarded as mining operation. The business which is carried on by the defendant is anything but mining operation as is defined in the Mines and Minerals (Industrial and Development) Act itself. Section 3(d) of this Act rules thus:- "(d) 'mining lease' means a lease granted for the purpose of searching for, winning, working, getting, making merchantable, carrying away or disposing of minerals or for purposes connected therewith, and includes and exploring or a prospecting licence." The business carried on by the defendant, is exclusively in the nature of manufacturing business and the plaintiff is only a supplier of raw materials to defendant no. 1 and such a transaction cannot come within the purview of mining operation and the lease in favour of defendant no. 1 cannot be regarded as a mining lease. In the result, therefore, Sections 4(a) and 10A of the Bihar Land Reforms Act, even on this ground, cannot be held to be a bar to the plaintiff's right to institute the suit inasmuch as its right as a lessee is not in any way invalidated on account of the Bihar Land Reforms Act. 8. The next question for consideration is whether the injunction prayed for can be granted.
8. The next question for consideration is whether the injunction prayed for can be granted. The learned District Judge has scrutinised in this connection the relevant provisions of the lease particularly bearing upon the plaintiff's right to compel defendant No. 1 to purchase all the coal required by him for manufacture of coke. It is as follows:- "He (the lessee) will purchase slack and dust coal for manufacture of coke from the lessor's collieries at the prevailing market rate or at such other rates as may be agreed upon by the parties hereto whenever the lessors will have suitable coal for the manufacture of coke available for disposal....." The plaintiff relied upon this term as laying down an obligation on defendant No.1 to purchase the entire quantity of coal from the plaintiff company for manufacture of coke and, further, stopping defendant No.1 from making the purchase from any other source. The positive terms of the purchase of coal from the plaintiff implied a negative condition not to purchase coal from any other quarter. The contention urged on behalf of defendant No.1, however, was that although there was such a positive term for purchase of slack and dust coal, it did not imply a negative term that defendant No.1 would not obtain his supply from any other source. It may be stated that both the Courts below have negatived the plaintiff's claim because even, in so many words, this term does not make it obligatory for defendant No.1 to purchase all coal required for manufacturing purposes from the plaintiff but whatever would be suitable for manufacture of coke available for disposal. In the first place, the plaintiff was not bound to supply the entire quantity of coal required by the defendant for carrying on his business but it gave an option to the plaintiff to supply the amount which was available for disposal. This would be an onerous condition and would be unjust because whereas it gave option to the plaintiff to supply the quantity of coal dust which was available for disposal, if the negative were implied in it and if that interpretation were to be accepted that such a condition must be fulfilled and that an injunction could be issued compelling the defendant to purchase all coal only from the plaintiff, the defendant would not have the option to get the supply from any other source.
Such a construction, therefore, will be patently unjust. The Courts below have further taken into account the other part of this contention which is to the effect that the defendant would be at liberty to purchase only such slack and dust coal as would be suitable for the manufacture of coke. It was not provided in the lease as to who would determine the suitability of the coal for manufacture of coke and, more so, where the parties might differ, the plaintiff alleging that the dust coal supplied by it was suitable for manufacture of coke and the defendant maintaining that it was not so. In the absence of any solution of such a dispute provided in the lease it could not be enforced by the order of injunction restraining the defendant from purchasing his coal from any other source. It is true no doubt that the enforcement of this positive term would be in the nature of compelling the defendant to purchase the coal from the plaintiff and it was conceded that such a positive term could not be enforced. The real question in dispute between the parties was confined, therefore, to determining whether this positive term implied the negative term, i.e. the defendant could not purchase coal from any other source. The relevant provision in this connection is Section 21, Clauses (b) (c) and (g) of the Specific Relief Act, and Paragraph two of Section 54 and Sections 56 and 57 of that Act. Section 21, Clauses (b) (c) and (g) run thus:- "21 Contracts not specifically enforceable-The following contracts cannot be specifically enforced:- x x x x [b] a contract which runs into such minute or numerous details, or which is so dependent on the personal qualifications or volition of the parties, or otherwise from its nature is such, that the Court cannot enforce specific performance of its material terms; x x x x [c] a contract the terms of which the Court cannot find with reasonable certainty; [g] a contract the performance of which involves the performance of a continuous duty extending over a longer period than three years from its date; x x x x Clause (b) therefore, prohibits specific performance of a contract the terms of which run into such minute and numerous details or which from its nature is such that the Court cannot enforce specific performance of its material terms.
Clauses (c) and (g) thus prevent the specific performance of a contract the terms of which cannot be fixed with reasonable certainty and the performance of which involves the performance of a continuous duty extending over a period longer than three years from its date. The learned District Judge has taken the view that specific performance of this contract could not be decreed under any of these clauses of Section 21. Since the lease in favour of defendant no. 1 by defendant no. 2 did not provide any period during which alone defendant no. 1 was bound to purchase the entire amount of coal required for the manufacture of coke, it implied the performance of a continuous duty extending over a longer period than three years from its date. Clause (g), therefore, is a clear bar. The terms of this lease also come within Clauses (b) and (c) inasmuch as under Clause (b) specific performance could not be allowed because, as I have already indicated, it will be difficult for any Court to determine on every occasion the suitability of the coal dust to be supplied and whether defendant no. 1 would be bound to purchase this coal from the plaintiff. Even in terms of Clause (c), the question of the price to be paid by the defendant to the plaintiff was to be determined by agreement between them and in case of no agreement being reached, it will be difficult to compel the defendant to get his supply from the plaintiff's colliery. In terms of Clause (c), therefore, it is clear that the term of this contract could not be determined with reasonable certainty. The learned District Judge is right, therefore, in holding that specific performance of the contract could not be granted to the plaintiff. 9. The next question which has been convassed is that even if the positive covenant in the agreement between the parties obliging the defendant to obtain his entire supply of coal dust and slack from the plaintiff company would not be enforceable in law, at least, the negative covenant which is implied by the positive covenant oust be given effect to and defendant no. 1 should be restrained by issuing an injunction from getting his supply of these materials from any source other than the plaintiff's collieries.
1 should be restrained by issuing an injunction from getting his supply of these materials from any source other than the plaintiff's collieries. Reference has been made in this connection to Section 57 of the Specific Relief Act, 1877, in which it is provided that a contract comprising an affirmative agreement to do a certain act, coupled with a negative agreement express or implied, not to do a certain act, the circumstance that the Court is unable to compel specific performance of the affirmative agreement shall not preclude it from granting an injunction to perform the negative agreement. In English law, there is a tendency now not to imply negative agreement in the usual course and the general view is that every contract between the parties to do a positive act must also contain a negative agreement not to do anything inconsistent with the positive direction and there must be a clear and distinct stipulation of a negative character before it can be enforced by granting a mandatory injunction. This is the line followed in (3) Roberts V. Security Company Limited (75 Law Times 531). In India, however, in view of the very wide terms of Section 57 of the Specific Relief Act, the view laid down, which has been referred to by the learned District Judge, is what is found in (4) Shree Ambarnath Mills Corporation, Bombay V. D.B. Godbole, Custodian of Evacuee Property (A.I.R. 1957 Bombay 119) in which it has been observed (as quoted by the learned Judge) as follows:- "It is true that the liability (Disability) of the Court to compel specific performance of an affirmative covenant does not preclude the Court from enforcing a negative covenant contained in the agreement. The negative covenant need not be express; it may be implied from the tenor of the agreement. But the covenant to be negative must be one by which a party to the agreement undertakes either expressly or by necessary implication not to act in a particular manner. Whether an agreement is affirmative or negative is a matter of substance and not of mere form, and the negative stipulation, whether it is express or implied must be distinct; and an affirmative agreement does not by itself imply a negative agreement not to do something inconsistent therewith.
Whether an agreement is affirmative or negative is a matter of substance and not of mere form, and the negative stipulation, whether it is express or implied must be distinct; and an affirmative agreement does not by itself imply a negative agreement not to do something inconsistent therewith. Otherwise, of every affirmative agreement a breach would be restrained by an injunction even if the Court is unable to compel specific performance of that affirmative covenant" It has further been observed:- "An agreement to sell property to a certain person does not necessarily imply a negative agreement that it will not be sold to another person. If breach of an agreement to sell property is to be restrained by an injunction, reliance cannot be placed upon the negative implication of the affirmative covenant to sell the property. There must be something in the agreement, apart from the affirmative agreement, which shows that the promisor has expressly or by necessary implication agreed not to sell the property to any person other than the purchaser." The decision in (5) Burn & Co. Ltd. V. Colin MacDonald (13 Calcutta Weekly Notes 255) is an authority only for the proposition that in Section 57 of the Specific Relief Act there is wider power given to the Court in India for granting an injunction where negative covenant is implied than in England. The reference to (6) Wight V. Dickson (3 English Reports 651) is not of any assistance to learned Counsel for the appellant because in that case there was a clear negative covenant that the lessees John and George Dickson were not to be at liberty to purchase penwood, or coal of any kind, from any other coal work, as long as they can be supplied at the above rates. That case, therefore, is no authority for interpreting Section 57 of Specific Relief Act. The learned District Judge has considered the terms of the covenant between the parties as also the correspondence which passed between them to determine whether the terms of the document in the present case requiring defendant no. 1 to obtain his entire supply of coal-dust and slack from the plaintiff company implied a term prohibiting defendant no. 1 from purchasing his supply of coal from any other quarters.
1 to obtain his entire supply of coal-dust and slack from the plaintiff company implied a term prohibiting defendant no. 1 from purchasing his supply of coal from any other quarters. Reference has been made to Exhibit A(1) which was which was a letter addressed by the plaintiff to Bhowra Coal Company on the 29th August, 1958, expressing therein the plaintiff's inability to give topmost priority to the defendant's requirement. Exhibit 1 was a letter addressed by the plaintiff to defendant no. 1, dated the 19th of July, 1955, intimating to defendant no. 1 that the plaintiff's local agent at Bhowra was advised by the company to improve the quality of the coal which he supplied to the coke plant. Exhibit A (25) was a letter addressed by defendant No.2 to Bhowra Coke Company, bearing date the 7th of February, 1957, telling the Coke Company that it would not be advisable for the company to cancel the sanction of one thousand tons of slack from M/s Mackneil & Co., as defendant no. 2 had still to dewater in several places. The learned District Judge has also referred to the oral evidence of a number of witnesses on this point. He has also referred to the evidence of some experts such as D. W. 1 as also Adinath Lahiri in which it is stated what kind of coal alone could be utilised for the manufacture of coke, P.W's 50 and 51 also referred to the requisites required in coal for manufacture of hard coke such as (1) low moisture content not exceeding 2%, (2) low volatile content not exceeding 25 to 30% and (3) low ash content not exceeding 16 to 17 %. P.W. 55 said that coal for the manufacture of standard quality of coke would be 17% ash and volatile to the extent of 25 or 26% and caking index to the extent of 14 to 15% for coal containing ash or volatile matters. Beyond those limits, the coal would not be suitable for manufacture of good quality of coke. Defendant no. 1 often made complaint to defendant no. 2 whenever there was any deterioration in the quality of coal supplied by defendant no. 2 to the coke plant, vide Exhibits 1(r), 1(u), 1(v) and 1(z-7). Exhibits 3 series were reports sent by defendant no. 1 to defendant no.
Defendant no. 1 often made complaint to defendant no. 2 whenever there was any deterioration in the quality of coal supplied by defendant no. 2 to the coke plant, vide Exhibits 1(r), 1(u), 1(v) and 1(z-7). Exhibits 3 series were reports sent by defendant no. 1 to defendant no. 2 dealing with the analysis reports regarding the coal supplied by the lessor. Reference has been made like this to the large number of letters which passed between the parties to show that it is very difficult to judge in every case the quality of the coal supplied. The learned District Judge came to the following conclusion:- "On a consideration of all the above aspects it would appear that the contention that the aforesaid term in the lease regarding purchase of coal suitable for making of coke from the collieries of the lessor whenever such coal is available for disposal necessarily implies a negative agreement not to purchase any coal by the lessee from any other sources is quite untenable as the defendant has evidently right to purchase coal from other sources under various circumstances, such as failure on the part of the lessors themselves to make supplies of suitable coal by the lessors either due to their unwillingness to make supplies to defendant no. 1 for some reason or other or due to their inability to do so owing to strikes, epidemics or shortage in production etc. as well as failure to give regular supplies to the defendant no. 1 all the requisite quality of coal in accordance with his requirements and failure to supply the requisite quality of coal required for the defendants plant and under other circumstances also." Coming to this conclusion, the learned District Judge held that in the circumstances of the present case, the negative covenant could not be implied from the positive covenant in the lease and injunction could not issue accordingly restraining defendant no. 1 from purchasing coal from other sources. It may be stated that one of the arguments on behalf of respondent no. 1 also was that the grant of injunction is a matter of discretion and since in the present case both the Courts below have exercised that discretion against the plaintiff, this Court will not override that discretion and hold that in this case defendant no.
It may be stated that one of the arguments on behalf of respondent no. 1 also was that the grant of injunction is a matter of discretion and since in the present case both the Courts below have exercised that discretion against the plaintiff, this Court will not override that discretion and hold that in this case defendant no. 1 should be restrained by an injunction from getting his supply of coal from any other colliery. Since, however, the propriety of resting an order of injunction in the circumstances of the present case has already been considered, this point, strictly speaking, does not arise and since the conclusion is either way the same, it must be held that the Courts below were right in not exercising the discretion for passing any order of injunction. Mr. Lal Narain Sinha has also referred to the case of (7) Callianji Harjivan V. Narsi Tricum (I.L.R. 18 Bombay 702) for the proposition that where an ordinary person has to render service, the negative will not be implied. In the present case also the negative cannot be implied because the plaintiff also can sell its commodities elsewhere in the market. It is true no doubt that if defendant no. 1 commits any breach of the contract and if any damage results in consequence to the plaintiff, he will be at liberty to institute a suit for damages against defendant no. 1; but that is a remedy which is different from the remedy sought to be enforced in the present suit by issuing an order of injunction. The question, as to when a negative will be implied when the term is only positive is no doubt one of nicety and the Court in every case will have to examine the relationship between the parties and the terms contained in the covenant before coming to a conclusion one way or the other. But it is clear in any case that the negative term in a covenant cannot be implied except where the performance of the positive term is such that it implies the negative as an inherent proposition.
But it is clear in any case that the negative term in a covenant cannot be implied except where the performance of the positive term is such that it implies the negative as an inherent proposition. For instance, in illustration (a) to Section 57 of the Specific Relief Act, the positive term contracted by A to sell to B goodwill of a certain business and an agreement not to carryon that business in Calcutta would imply that even A could not be compelled to send his customers to B but at least B could obtain an injunction restraining A from carrying on business in Calcutta. Where the two, however, can stand apart, the positive term in an agreement could not be taken to imply a negative term. (8) Lumley V. Wagner (16 Jur. 871 : S.C. 1 De G. M. and G. 604 at p. 615) is a leading case on the point. A singer who undertook to perform at a certain theatre and failed to do so was, however, restrained from singing at another theatre, because singing at another theatre would divert the business of the theatre where she agreed to perform to another theatre because of the reputation of her performance. The negative covenant was, therefore, implied in the positive covenant. In the present case, however, coal is an ordinary commodity and purchasers also may be had in abundance. In the circumstances, therefore, the positive term in this case cannot be held to imply a negative term. The decision in (9) I.L.R. 18 Bombay 702 at 714 is also to the same effect. 10. It is thus clear that the appeal has no merit and it must be dismissed with costs. BANERJI, J. I agree. Appeal dismissed.