JUDGMENT 1. THIS appeal arises out of a judgment and decree passed by Mr. Justice U. C. Law in suit No. 1874 of 1955. The said judgment and decree has been challenged by the defendant Life Insurance Corporation of India on several grounds which will appear in the body of the judgment. In order to understand the precise significance of the contentions of the respective parties, it is necessary to set out the facts giving rise to the litigation, out of which the present appeal has arisen: 2. ONE Brojendra Mohan Mitra a Zamindar of Ghoramara in Rajshahi (at the relevant time in Pakistan) took out a policy on his life from the Oriental Government Security Life Assurance Co. Ltd. of Bombay (to be referred hereinafter as the insurer) on the 9th November, 1932 for a sum of rs. 24,000/ -. The insurer, in consideration of the premiums paid and to be paid to it, issued a policy No. 358406 on the life of Brojendra agreeing to pay to him or his assignees, executors, administrators or other legal representatives the sum assured together with all bonus and profits which might accrue upon the policy on the assured surviving until 25th October, 1952 or at his death which, ever was earlier. Under the terms of the policy the sum assured was payable at Bombay. The said policy matured on October 25, 1952 and the sum of Rs. 29,650/- became payable on the said policy to Brojendra (hereinafter referred to as the assured. . On the 18th December. 1952 brojendra executed a deed of assignment in favour of his son Rabindra the plaintiff in the suit, in Calcutta within the jurisdiction of this Court. After the deed of assignment was executed the assured and the assignee wrote letters to the insurer intimating the fact of assignment and also gave notices in writing intimating about the said assignment to the insurer at its principal place of business at Bombay and also to it the deed of assignment which tire insurer acknowledged in writing by its letter dated 31st December, 1952. The plaintiff claimed by virtue of the said need of assignment executed in his favour by his father the sum of Rs. 29,650/- But the said amount was not paid by the insurer, as such the plaintiff had to institute the suit on july 7, 1952. 3. The plaintiff claimed by virtue of the said need of assignment executed in his favour by his father the sum of Rs. 29,650/- But the said amount was not paid by the insurer, as such the plaintiff had to institute the suit on july 7, 1952. 3. AFTER the institution of the suit and during' its pendency, the Life Insurance Corporation Act of 1956 was enacted. Under the provisions of the said Act ail assets and liabilities pertaining to the controlled business of all insurers including the Oriental Government Security Life Assurance Co. Ltd. of Bombay were transferred to and vested in the Corporation with effect from 1st September, 1956. Accordingly on the prayer of the plaintiff, the original plaint was amended and the Life-insurance Corporation of India was made the defendant in place of the original defendant. The insurer contested the claim of the plaintiff on the ground that the principal elements of the contract of insurance were most closely or densely grouped around Dacca in Pakistan, they mainly relied on the following elements in support of their contention : (i) That the Insurance policy was attached to Dacca Register. (ii) The residence of the assured and his occupation on the face of the document were stated to be Zamiudar, gihoramara, Eajshahi, a place with pakistan. (iii) The premiums were paid m eajshahi both before and after partition. (iv) Servicing of the policy was in dacca and Rajshahi. (v) The policy has been treated as a foreign business and (vi) Due to partition of India, the position has greatly been changed and that the proper law applicable to the contract in question is the proper law existing in Pakistan. 4. THE learned Judge did not accept the contentions of the defendant corporation and repelled all of their contentions and held that the elements of the contract of the policy of insurance out of which the obligation to pay ''arose, were most closely and densely grouped at Bombay which was the natural seat and the place with which the transaction had its real and closest connection. On that finding, the learned judge held that the proper law applicable in this case was the India Law and the Pakistan law had no application. On that finding, the learned judge held that the proper law applicable in this case was the India Law and the Pakistan law had no application. The learned Judge also considered the effect of the Private International Law as well as the Pakistan foreign Exchange Regulation Act VII 1947 in order to understand their impact on the contract ii; question and was of the view that none of these acts or tie law could affect -the claim of the plaintiff, in consequence whereof the learned Judge passed the decree in favour of the plaintiff. The said judgment and decree has been impugned, by tie Life Insurance Corporation of India (hereinafter referred to as the corporation. Important question or Private international Law has been raised in this case. Both the parties dealt with the same in extenso. Mr. Roy Chowdhury has dealt with this matter elaborately, in order to support his contentions that the proper law to govern the contract, in question is the law of Pakistan and the elements hi support of the said contentions are those already described while dealing with the contention s of the defendant. Mr. Roy Chowdhury further contended that the materials on record would show that the insurer in order to circumvent the foreign exchange lows of Pakistan, created the said deed of assignment Accordingly, the said deed should be considered to be void and unenforceable under the law. It has further been contended that the elements arising out of the contract of insurance were most closely or densely grouped around dacca within Pakistan and that the natural seat and place with which the transaction were connected, was at dacca and as such it had its closest and most real connection there. 5. MR. Ghosh, learned Counsels for the respondent has, on the other hand, contended that the materials on tie record would indicate that the contract of the pokey out of which the obligation to pay arose was most closely and densely grouped at Bombay and that was its natural seat and the place with which the transaction, had its closest and most real connection. Accordingly, the decree which has been passed by the learned Judge was a proper and valid one and should not be altered in any view of the matter. 6. ON the pleading of the parties several issues were framed and have been considered by the learned Judge. Accordingly, the decree which has been passed by the learned Judge was a proper and valid one and should not be altered in any view of the matter. 6. ON the pleading of the parties several issues were framed and have been considered by the learned Judge. In the absence of any express choice of law governing the contract, the court is to find out the proper law, applicable in such a case. That is necessary in order to avoid the conflict of law and to give relief, if any, to the party concerned. 7. THIS leads us to the consideration of the most important point as to the proper law which is applicable in the instant case. The legal liabilities of the parties depend much on the decision of this point This, therefore, raised a complex question of International law. It may be noted from the trend of decisions that this question depends on various factors. No positive yardstick of facts and circumstances to come to a proper conclusion in this respect can be fixed. The same would vary from cases to cases depending on the peculiar facts and circumstances involved in the same. 8. THE question how to determine the proper law of a contract has been considered by Dicey in his book "conflict of Laws", 9th Edition' at page 728. Dicey has divided the said subject under three sub-Rules under Rule 146. Sub-rule (1) lays down: "when the intention of the parties to a contract, as to the law governing the contract, is expressed in words, this expressed intention, in general determines the proper low of the contract. Sub rule (2) is in the following line: when the intention of the parties to a contract with regard to the law governing the contract is not expressed in words, their intention is to be inferred from the terms and nature of the contract, and from the general circumstances of the case, and such inferred intention determines the proper law of the contract. " Sub-rule (3) is very important for the determination of the point at issue, involved in this case It runs as under : "when the intention of the parties to a contract with regard to the law governing it is not expressed and cannot be inferred from the circumstances, the contract is governed by the system of law with which the transaction has its closest and most real connection. " The plaintiff's contention is that the proper law of the contract is the Indian law. Contrary is the contention of the defendant, which claims the Pakistan law to be the proper law of the same. Difficulty in this case arose due to the fact that in the year 1932 when the policy was made in favour of Brojendra by the Oriental Government Security Life Assurance Co. nobody could expect that India would be partitioned and that the place where brojendra was living at the time of issue of the policy would be part and apical of Pakistan. Ext. 1 is the Insurance policy issued in favour of Brojendra the Head Office of the insurer is even now situated at Bombay. As per term of the said policy the matured amount would be payable at Bombay in Indian currency. Time and place of performance have been laid down in the said policy. So the local law i. e. the law of india is contemplated in this contract. According to the terms of the policy the performance of the promise is to be made at Bombay. 9. IF, however, the law of Pakistan is made applicable, the position would be different and different considerations will arise in this respect. The above fact itself shows the gravity of the question which is involved in this case. 10. WE have already referred to the three sub-rules which have been framed by Dicey in his book (Conflict of laws, 9th Edition. These three fuies are the result of several decisions of different courts with reference to which dicey formulated the law as indicated in those sub-rules. In any view a Court would have to enquire and to come to a proper finding as to the intention of the parties which might have been formed by a reasonable person, placed in such a situation if his attention would have been directed to the supervening circumstances, i. e. the partition of India. In any view a Court would have to enquire and to come to a proper finding as to the intention of the parties which might have been formed by a reasonable person, placed in such a situation if his attention would have been directed to the supervening circumstances, i. e. the partition of India. One view is that in the absence of an expressed or clearly implied selection of the proper law, the court is to determine the intention of the parties regarding the proper law which they as treasonable person might have intended, had they knew about the changed situation, i. e. partition of India, when the contract was made. In such a matter the Court is to judge what might be their intention as to the place of performance of the contract and under what law they wanted the contract to be performed. In such an enquiry many matters have to be taken into consideration. The following questions are to be considered in this connection : the place of contract; the place of performance; the place of residence or business of the parties respectively; arid the nature and the subject matter of the contract. That is the view expressed by Dicey in his above mentioned treatise at p. 743. In dealing with the attitude of English Judges he observed in his book at p. 724 as under: "english Judges have consistently declined to tie themselves down by any rigid or narrow rule for determining the proper law of a contract and they have always considered the variety of circumstances, such as the nature of the contract, the customs of business, the place where the contract is made or is to be performed and the like. Any one of these may, in a given case, permit an inference as to an implied intention of the parties or suggest a conclusion as to the connection of a contract with a particular legal system. Despite appearances to the contrary this flexible method was adopted by the English court, even at a time when some older reports and text books reiterated the maxim that a contract was governed by the law of the place where it was made. Despite appearances to the contrary this flexible method was adopted by the English court, even at a time when some older reports and text books reiterated the maxim that a contract was governed by the law of the place where it was made. " Cheshire in his book "private International Law" (9th Edition) at page 216 has considered the views of different-countries on this matter as well as the views of Dicey and came to the following presumption which seems to us to be the more cogent and logical in form. "on an objective view of the matter every term of the contract, every dental affecting its formation and performance, every fact that points to its natural seat is relevant. No one fact is conclusive. " in short, it may be said that constrict requires to be regarded and read as a whole; one is to search for the system of law with which the contract is most closely connected, the Court must look at all the circumstances of the contract. To solve the problem, the Court should take into account such factors as the place of residence or business of the parties, the place where the contract is made or is to be performed and the nature and subject matter of the contract. In order to show how the proper law applicable to the facts of a particular case, can be determined, some decisions have been placed at the Bar. 11. THEIR Lordships of the Judicial committee, in the case of John Lovington bonython and others v. Commonwealth of Australia reported in (1951)A. C. p. 201 at page 219, held that "the mode of performance of the obligation may, and probably will be determined by English law; the substance of the obligation must be determined by the proper law of the contract, i. e. the system of law by reference to which the contract was made or that with which the transaction has its closest and most real connation. " lord Morris in his speech delivering judgment in the case of Tomkinson and another v. First Pennsylvania Banking and Trust Co. " lord Morris in his speech delivering judgment in the case of Tomkinson and another v. First Pennsylvania Banking and Trust Co. reported in 1961 A. C. 1007 at page 1081, referred to the observation of Viscount Simonds as made in the above mentioned case (1951 A. C. 201) with approval that law of the country would apply with reference to which the contract was made or that with which the transaction has its closest and most real connection. 12. LET us now turn to a very important decision of the Privy Council in the case of Compagnie Darmement maritime S-A. And Compagnie Towisiennede navigation S. A. reported in 1971 a. C. 572. Their Lordships in that case held which will appear from the speech of Lord Reid at page 583, that one should no longer be concerned with the parties' intention. In the absence of any positive indication of intention in the contract the law will determine the proper law by deciding with what country or system of law the contract has the closest connection. By what principle one should be guided to find out the proper law of the contract, has elaborately been, dealt with in the case of Coast Lines Ltd. v. Hudig and Veder Chartering N. V. reported in (1972) 2 Q. B. 34 wherein lord Denning M. R. has observed : "in order to determine the proper law of the contract, the courts at one time used to have a number of presumptions to help them. Now we have to ask ourselves : what is the system of law with which the transaction has closest and most real connection. This is not dependent on the intentions of the parties. We have to study every circumstances connected with the contract and come to a conclusion. '' 13. WE need hardly trouble ourselves to find out what principles are applicable in such a case as their Lord-ships of the Supreme Court has laid, down the same which govern such contracts. Their Lordships in the case of delhi Cloth and General Mils Co. '' 13. WE need hardly trouble ourselves to find out what principles are applicable in such a case as their Lord-ships of the Supreme Court has laid, down the same which govern such contracts. Their Lordships in the case of delhi Cloth and General Mils Co. Ltd. v. Harman Singh and others reported in A. I. R. 1955 S. C. 590, held that the law of that country would be applicable where the elements of the contract out of which the obligation to pay arises are most densely grouped and where the contract has its natural seat and the place with which the transaction has its closest and most real connection. The above decision of Supreme Court though clinches the issue, we may further ser what other special features may be considered in a contract of Insurance Policy for determining where the obligation to pay the money under the contract is most densely grouped or situated. 14. IN such a case, sometimes the question arises as to what proper law may be applied, when the insured may claim certain law of his country is applicable and the insurer disputes the same. This question has elaborately been discussed by Hazdy Ivamy in his book "general Principles of Insurance law," (2nd Edition. He dealt with that matter keeping in view the 'intention and localisation' theory. The following factors are relevant for the purpose of determination of the issue : (i) The place where the contract is made; (ii) the place where the payment to be made; (5ii) the form in which the policy is framed; (iv) the position when the terms of the policy are valid in one country, but not in another. Further question as to the effect of such policy, entered into through an agent, has also been considered. When contracts are made through agents, such questions are considered looking into the authority he had in effecting the policy. When the agents' power is limited and it is his duty to transmit all proposals for insurance to his principals at the head office, who alone have the power to decide as to their acceptance or rejection, no contract comes into effect, till it is accepted by the head office. In such a case contract is made in the head office, though the proposal is made from outside and is sent there after acceptance. In such a case contract is made in the head office, though the proposal is made from outside and is sent there after acceptance. In such a case the parties to the contract must be presumed to have intended to apply the law of the country, from where the same was issued, payment of premium, through some office, outside the State. does not change the character of the contract; it is presumed to have so been done for the facility for payment, to be made by the party. In this connection we cannot check our temptation to refer to a very old decision in the case of John palmer Parkon and Manodntory and royal Exchange Aiwvmnce Co. reported in Dunlop Vols. VII and VIII. In that case the above views were expressed and accepted. The question is now finally settled that the proper law depends upon the localisation of the contract which in the absence of any expressed term has got to be ascertained on. consideration of certain facts such as the place of contracting place of performance, place of residence or business of the parties respectively, and the nature and subject matter of the contract. It must, therefore, be governed by the law to which the contract normally belongs to be ascertained objectively -in the light of all the circumstances connected the contract taken as a whole. In the case of insurance policy, further consideration should be given to ascertain where the policy was accepted, where the money after it matures, is payable, what are the authorities of the agent to enter into such a contract and such other matters affecting the contract of the insurance policy. 15. TESTED with the sad principle, the fact and circumstances involved in this case, are to be examined in order to ascertain whether the law of India or that of Pakistan would be applicable. 16. THE learned Judge while dealing with this point, has elaborately dealt with both documentary and oral evidence. It is admitted and borne out by ext. 1 that on the 6th of November, 3932 the Insurance Policy No. 358406 was issued in favour of Brojendra upon his life for the sum of Rs. 24,000/ -. The said policy matured on 25th October. 1952. It is admitted and borne out by ext. 1 that on the 6th of November, 3932 the Insurance Policy No. 358406 was issued in favour of Brojendra upon his life for the sum of Rs. 24,000/ -. The said policy matured on 25th October. 1952. This is an Indian rupee policy and an per term of the contract of the policy the amount covered by that policy would be payable at Bombay. In this connection let us consider the documentary evidence on record to see how the parties dealt which the policy in question. The first letter which may be referred to is Ext. A (a), which is same as Ext. 9. This is a letter written by the Manager of the Company to Brojendra from Bombay. That letter shows that the company admitted Brojendra to have paid premiums at the exchange rate of Pakistan, i. e. Pakistan rs. 69/8/ Indian Rupees 100/- On adjustment after converting the Pakistani currency to the Indian rupee i. e. the rate at which the premiums were to be paid, some over payment was seen to have been made by Brojendra which was subsequently adjusted by the company. That letter unmistakably printed out that the company treated the said policy as an Indian policy, premiums of which were to be paid in Indian money but as the said premium was paid in Pakistan such adjustments had to be made. That is the post partition document written by the Manager from Bombay to Brojendra assured at Calcutta. The letter Ext. A (b) addressed by Brojendra from iris calcutta address P. 138. Picnic Garden road to the Company demanding the money of the said policy being matured to be paid at Calcutta. Ext. A (c) is the letter written by Brojendra to the manager at Bombay. The said letter was sent by Brojendra from his Calcutta residence. He demanded the money to be paid at Calcutta. In the said, letter he further stated that he generally stayed in India for major portion of the year. All the letters and the correspondences which have been filed by the parties go to show that the correspondences were carried by the company from Bombay addressed to Brojendra at Calcutta and also to indicate that whenever Brojendra made correspondence he made the same from Calcutta. All the letters and the correspondences which have been filed by the parties go to show that the correspondences were carried by the company from Bombay addressed to Brojendra at Calcutta and also to indicate that whenever Brojendra made correspondence he made the same from Calcutta. The letter in which Brojendra indicated that for major portion of the year he lives at Calcutta, is dated October 20, 1952. He informed, the company that the said sum would be required for the treatment of his wife who was bedridden for a long time at Calcutta. That letter was addressed from Calcutta which indicated that his son Rabindra was also a resident of Calcutta. From this, we find that Brojendra while writing this letter was at Calcutta with his wife. The next letter written by the Manager of the company from Bombay to brojendra while residing in Calcutta shows that the company had already received the discharge form duly filled up by Brojendra. It is for the first time the company wanted to know whether Brojendra was a permanent resident of India. Brojendra in reply to the said letter informed the company that no further action need be taken until further instructions from his side, that is the letter written by him on 21st november 1952 from Calcutta. In the meantime a deed of assignment in respect of the policy in question was executed in Calcutta by Brojendra in favour of Rabindra - the plaintiff on the 18th December, 1952. The said deed of assignment has been marked as Ext. B, By that deed all the rights, title and interest in the policy in question were transferred in favour of Rabindra. On getting the said deed of assignment Rabindra informed the company by his letter dated 19th January. 1952 that the money was to be paid to him. In that letter he categorically stated that in a case like this in order to make payment by the company no sanction of the State Bank of Pakistan was needed. He also cited two examples giving the names of the persons to whom money under such policy were paid in, Indian currency after partition of India. To that letter we do not find any reply from the company to show under what circumstances those persons were paid money in India and in Indian currency. That letter is Ext. He also cited two examples giving the names of the persons to whom money under such policy were paid in, Indian currency after partition of India. To that letter we do not find any reply from the company to show under what circumstances those persons were paid money in India and in Indian currency. That letter is Ext. A (m. The other letters which are on the record go to show that Rabindra as well as Brojendra all along insisted for the payment of money in India and in Indian currency asserting that no sanction of the State Bank of Pakistan was necessary in a case like this. Ext. 1 is the Insurance Policy No. 358506 dated 9. 11. 32. Ext. 2 is the Foreign Exchange Regulation of Pakistan. Next letter to which reference was made is Ext. 3. That letter was addressed to Brojendra by the Manager of the company from Bombay. It was also addressed to Brojendra in his Calcutta address. It is dated 31st December, 1952. It has got some relevancy on the point at issue. In this letter the company agreed to make payment to the plaintiff Rabindra on the strength of his assignment deed dated 18th December, 1952 after obtaining sanction of the State Bank of Pakistan. In this letter the company for the first time also asserted that as the policy was effected through Decca Branch Office, the records pertaining thereto were required to be transferred to their head office before payment could be made to him in India. It is also stated therein that the company got information from the State Bank of pakistan that prior to transfer of such records from Pakistan to India, prior sanction of the State Bank of Pakistan was needed. From this letter we find that the company raised two fold objections with regard to the money to be paid in India to Rabindra. They are : (1) previous sanction from the State bank of Pakistan for payment of such money was necessary; and (2) previous sanction from the State Bank of Pakistan for Sending the records from Dacca to Bombay for the purpose of making such payments to Rabindra was also needed. Thus in the letter it is seen that two impediments for making such payment to Rabindra were pointed out by the Manager. Thus in the letter it is seen that two impediments for making such payment to Rabindra were pointed out by the Manager. Similar letter was also written to Rabindra by the Manager from Bombay by the letter Ext. 4 dated 18th February. 1953. Our attention has also been drawn to a draft of a letter meant for sending to the Assistant Controller, Exchange Control Department, State Bank of Pakistan from the branch office of the company, that draft was stated to have been prepared by Mr. Ranadive and stated to have been sent to their branch office at Dacca with instructions to send the same to the Assistant Controller, Exchange Control Department, State Bank of Pakistan. That letter is Ext. 5. In that draft letter Mr. Ranadive stated that in order to make payment of the money to Rabindra, copies of the policy records were required to be transferred to their Bombay office. The transfer of the policy records did not involve the transfer of the policy reserved either by book entry or otherwise. In the said letter he further added that the deed of assignment was executed when bout the assignor i. e. the fire assured and the assignee, were at Calcutta and as the assignment was made while Brojendra was a non-resident of Pakistan in favour of another who was also non-resident, of Pakistan to give effect to the said assignment was at all necessary. MR. Ghosh, learned Counsel for the respondent Rabindra, submitted that was the correct attitude which was taken by Mr. Ranadive but he subsequently yielded the wrong interpretation of the statutes and the connected regulations We shall deal with this matter subsequently at the relevant place in order to show that the attitude of the defendant was unreasonable, illegal and unjustified on the materials on record as well as in terms of the Foreign Exchange Regulation or pakistan as well as of India Next letter is Ext. 6 addressed by the Assistant controller, State Bank of Pakistan form dacca to the Inspector-in-charge of the defendant company. It is dated 2nd december, 1953. In this letter the state Bank of Pakistan insisted that they were not bound to take cognisance of such assignment as the amount covered by the policy became a claim in favour of a Pakistani national before the same was transferred. It is dated 2nd december, 1953. In this letter the state Bank of Pakistan insisted that they were not bound to take cognisance of such assignment as the amount covered by the policy became a claim in favour of a Pakistani national before the same was transferred. As such they insisted that use payment should be made in Pakistan. Mr. Ghosh drew our attention to the several provisions of the insurance Act, 193d to show that there was no time limit for transferring the policy by way of assignment to the assignee. There is nothing, according to him, to indicate that the policy having been matured could not be assigned to any person. If the proper law is the law of India which governs the contract in question then the attitude taken by the State Bank of Pakistan is unreasonable and unjustified. We shall look into this matter at the proper place. Mr. Roy Chowdhury, on the other hand, based his case on these two documents, Exts. 5 and 6. According to him, these two documents conclusively show that prior sanction of the State Bank of pakistan was necessary and without the same a friendly country, for the reasons to be considered hereafter, could not or should not violate the said direction of the same Bank of Pakistan in order to make payment to Rabindra. This is a matter which we shall deal in detail after considering what is the proper law oil the country which can be said to govern the contract in question. Our attention has been drawn to Ext. 8 i. e. the letter dated 10th January, 1953 in which Brojendra informed the Manager, claims Dept. of the company that he was a permanent resident of Pakistan. He made the following statements : "i am to state that I am a permanent resident of Pakistan. '' from this it has been argued by Mr. Roy Chowdhury that Brojendra was a reside of Pakistan and that he him self admitted the same. of the company that he was a permanent resident of Pakistan. He made the following statements : "i am to state that I am a permanent resident of Pakistan. '' from this it has been argued by Mr. Roy Chowdhury that Brojendra was a reside of Pakistan and that he him self admitted the same. The learned Judge, however, observed that the said statement was made on the 19th January, 1953 long after the cause of action of the suit arose and as such the said letter cannot be construed retrospectively, the other materials have got to be considered in order to find out what was the intention ton of Brojendra at the relevant time as to whether he wanted to be considered as a resident of Pakistan or that of India. This matter will be dealt with in details when we shall consider whether Brojendra was a resident of pakistan or of India at the relevant time. Ext. 9 is the letter dated 20th march, 1952 written by the Manager of the Company to Brojendra informing that the premiums paid by him in pakistan had been adjusted in equivalent Pak. rupees. On such adjustment it was found that Brojendra made some over payments which were adjusted against his premiums. Mr. Ghosh relied on the document to show that all the transactions of the company were carried from Bombay and that Dacca office was merely a post office to carry the directions given by the Head Office situated at Bombay, Mr. Roy Chowdhury, on the other hand, laid great stress on the document to show that the premiums of the said policy were paid at Dacca and as such it was contended that the transaction in respect of the said policy was carried in Pakistan and not in Bombay. Further reference to this fact will be made at the proper time when we shall deal as to whether the proper law is the law of Pakistan or that of India. On behalf of the appellant great stress has been laid on. Ext. 10 and 11. Ext. 10 is the letter written by the Assit. Controller, Reserve Bank of India to the company on the 7th march, 1957 giving certain directions for the payment to the policy-holder not a permanent resident of India. On behalf of the appellant great stress has been laid on. Ext. 10 and 11. Ext. 10 is the letter written by the Assit. Controller, Reserve Bank of India to the company on the 7th march, 1957 giving certain directions for the payment to the policy-holder not a permanent resident of India. Such payment on the maturity of the policy should be made from the foreign currency account maintained by the Corporation in the respective countries, that is a letter which was addressed by the Reserve Bank to the Company in answer to their letter, Ext. 11 dated 20th January, 1957 addressed to the assistant Controller, Exchange Control dept. Reserve Bank of India, seeking permission to make payments to the resident of Pakistan in respect of the matured policy out of Foreign Currency accounts held by them. The said permission was, however, granted by the reserve Bank on certain conditions as will appear from Ext. 10. From these two exhibits it was argued on behalf of the appellant that the permission of the reserve Bank as required under the provisions of the foreign Exchange regulation of Inlay to make payment in India was refused as such no further consideration in this matter should be given as the Reserve Bank of India was the final authority in the matter of according sanction. Mr. Ghosh, on the other hand, Las submitted that the said correspondence which passed between the L. I. C. and the Reserve Bank of india has no relevancy in the subject. That is the general permission sought for by the L. I. C. for making smooth payments to the policy holder residing outside India, was granted on certain terms that is a facility granted to those policy holders desiring to have the payments there; that does not show that persons desiring such payments to be made in India with the sanction of the authorities concerned was refused once for all. According to Mr. Ghosh, the question of permission in this case did not arise. That is all the documentary evidence on record. 17. REGARDING the oral evidence, the claim under the matured policy was not disputed. The plaintiff examined only Sri Sunil Chandra Chowdhury, the then Deputy Commissioner of Police, who was the witness to the deed of assignment. According to Mr. Ghosh, the question of permission in this case did not arise. That is all the documentary evidence on record. 17. REGARDING the oral evidence, the claim under the matured policy was not disputed. The plaintiff examined only Sri Sunil Chandra Chowdhury, the then Deputy Commissioner of Police, who was the witness to the deed of assignment. The legality of the assignment of the policy by Brojendra in favour of his son Rabindra is, however, not in dispute. With regard to the claim and the amount of money to be paid there is no dispute whatsoever. Dispute only centers round the mode and place of payment. On behalf of the defendant five witnesses have been examined. Of them the evidence of defense witness No. 1 Mr. Ranadive is, however, important. He was the principal actuary at the Central Office of the Life Insurance Corporation of India. He joined the Oriental Life Assurance corporation in the year 1937 and was promoted as the Assistant actuary and become tire Acting actuary of the said company. The Life Insurance Corporation came into existence in the year 1956. Since then he has been working as an actuary in the said Corporation. He has described the procedure to be followed in the matter of transaction by the company with a resident of pakistan and the relevant rules which regulated them. Reference to his evidence will be made in connection with the point which will be dealt with by us subsequently Witness No. 2 Samsul huda has proved the Pakistan Foreign exchange Regulation. He is an Advocate practicing in East Pakistan. He proved Ext. 2 the Pakistan Foreign exchange Regulation Act, 1947 as corrected up to July, 1960. The witness no. 3 is Mr. Krishna Murti. He is an assistant Accountant attached to the reserve Bank of India. He proved ext. 10. He wanted to say that the payments of the matured policy to the resident outside of India was to be made from the Foreign Currency Account maintained by the L. I. C. in the respective countries. Witness No. 4 is Mr. Pronab Mazumdar. He is an Assistant attached to the local Zonal Office of l. I. C. He brought certain records from dacca Office. Witness No. 5 is Mr. Sailendra Nath Chander. He was an employee attached to Oriental Assurance Co. from the year 1931. Witness No. 4 is Mr. Pronab Mazumdar. He is an Assistant attached to the local Zonal Office of l. I. C. He brought certain records from dacca Office. Witness No. 5 is Mr. Sailendra Nath Chander. He was an employee attached to Oriental Assurance Co. from the year 1931. He was transferred to Rajshahi sometimes in 1936 and he was there up to 1946. According to him, the premiums under the policy in question were used to be paid at Rajshahi and the Official receipts were issued in token of the same. He wanted to prove certain documents produced in Court, i. e. the register said to have been maintained at Dacca He said that he was at Rajshahi up to 1946 that is, sometime before partition and as he himself admitted that he had no definite knowledge as to the entries made in the said book, on the objection raised on behalf of the plaintiff, that account book was not admitted into evidence. Mr. Roy Choudhury made a prayer for admitting those documents in evidence at this stage. The said prayer has been objected to by the other side. The learned Judge has, of course, not given any reason as to his refusal to admit those documents in evidence. After hearing the parties and going through the evidence of this witness, we are of the view that the learned judge has very rightly refused to accept those documents in evidence. Thus matter will further be discussed hereafter, at the appropriate place. These are all the evidence on record. It may be mentioned, at this stage, that the learned counsel of the appellant placed before us all the documentary and oral evidence. The learned Judge has dealt with them in details. It will be a mere repetition on our part to refer to all the evidence over again as the same has been considered by the learned Judge. Be that as it may, we will have occasion to refer to the relevant portions of the evidence whenever required while considering the points at issue raised in this case. 18. WE shall now consider the impact of the partition of India had on the insurance policy. We shall discuss in detail the materials on record to find out the proper law which might be applicable in the instant case. 18. WE shall now consider the impact of the partition of India had on the insurance policy. We shall discuss in detail the materials on record to find out the proper law which might be applicable in the instant case. It is now almost a law depends upon the localisation of the contract and must be governed by the law of the place with which the transaction had its closest and most real connection and the elements of the contract out of winch obligation to pay arose, were most densely grouped. This may be ascertained objectively with reference to the materials connected with the policy in question. But for the partition of india, the of India would have governed the contract in question. It is now to be seen whether it has in any way altered the position. After the emergence of two countries in the year 1947 the different consideration arose. We are now proceeding to find cut on the principle enunciated earlier as to what is the proper law - whether law of India or that of Pakistan which will govern the contract. The learned judge observed that the transactions of the insurance policy were closely or densely grouped in Bombay and as such the proper law is the Indian Law which would govern the contract. In support of that he referred to grounds Nos. (a)to (w) which will appear at pages 137 to 139 of the paper book. Mr. Ghosh has drawn our attention particularly to the following facts in support of his contention that the proper law in such a case should be considered to be the law of India. (i) This policy was issued from bombay. It was sealed, signed and stamped on behalf of the Directors at bombay. Mr. Roy Chowdhury drew our attention to the fact that the said policy was issued by the agency - Dacca, Rajshahi. From this it was argued that as the proposal of the policy was made of rajshahi and Rajshahi subsequently became part of Pakistan, the Pakistan law should be the proper law to mould the character of the contract in question. We may refer to the evidence of mr. Ranadive in this respect, who slated in answer to questions 298 to 301, that such a policy was accepted at bombay and that the same could not be accepted in the branch office. We may refer to the evidence of mr. Ranadive in this respect, who slated in answer to questions 298 to 301, that such a policy was accepted at bombay and that the same could not be accepted in the branch office. Moreover, the policy shows that the payment was to be made in Bombay. As on what value is to be attached to such feels have been dealt with by us hereafter. Not a single fact by itself is sufficient to find out what proper law is to be made applicable. In the conflict of laws the entire facts are to be taken as a whole. In the case of "the Assunzione" reported in (1954) All. E. R. 278 the relevant factors which require to be considered to come to a conclusive decision in such a matter have been mentioned. Amongst them the place of payment his also been considered to be the relevant factor to find out the proper law which might be applicable. The said question was also raised in the case of New York life Insurance Co. v. Public Trustees reported in (1924) 2 Ch. 101 and it has been held therein that it was permissible and necessary to look in the terms of the contract and to determine from them at what place the debts would be recoverable. On the material on record, it was held that the same was recoverable in London as such the same was subject to the law of england. We have already noted that the place of payment of the money on maturity has been stated to be in Bombay. It has been argued by the learned counsel for the appellant that the payment of the premiums were made in pakistan. In view of the fact that Rajshahi was the part and parcel of India such payment of premium up to 1946, does not affect the proper law in any way. Moreover, payment of policy premiums does not indicate anything as to the place where the contract was to be performed. The realisation of the money might have been made by the agency of that place which admittedly had no authority to mould the policy of the company. (ii) This policy was issued from bombay, Head Office, and that the said policy was an Indian rupee policy. The realisation of the money might have been made by the agency of that place which admittedly had no authority to mould the policy of the company. (ii) This policy was issued from bombay, Head Office, and that the said policy was an Indian rupee policy. That will appear from the policy itself as well as from the answer given by Mr. Ranadive to question No. 309 where he clearly admitted that it was an Indian, rupee policy. He has also admitted the same, in his answer to the questions 333 to 336. Ext. 9 may also be considered in this respect. In that letter written by the manager of the company to Brojendra, the Indian character of the policy was maintained. That witness in answer to Question No. 200 has also admitted that a resident of Pakistan had to pay premiums in Indian rupee though on calculation at the equivalent rate of pakistan currency, it had to be adjusted. From the above facts it is seen that the said policy retains, throughout, the character of Indian policy. (iii) Admittedly, the policy when issued was issued in India from the heads office at Bombay. Up to the time of its maturity, it retained the character of Indian policy. There is nothing to show that the company and the assured brojendra wanted to change the same or in other words both the parties main tired the status quo in respect of the said policy even after partition of India. That is another factor which will show the intention of the parties that the said policy would be the Indian policy payable in Bombay. (iv) The mode of assignment of the policy has been laid down in the policy itself. The assignments or the notices thereof should be submitted for registration direct to the Head Office of die co. in Bombay, that is to say, the registration was to be made at Bombay. Mr. Ranadive has very frankly admitted in answer to the question Nos. 302 and 304 that such registration was to be made at Bombay. We have already seen that, the policy originated at Bombay and was made payable at Bombay and the assignment of the same, if any, had to be registered at Bombay and in fact it was so registered. Ranadive has very frankly admitted in answer to the question Nos. 302 and 304 that such registration was to be made at Bombay. We have already seen that, the policy originated at Bombay and was made payable at Bombay and the assignment of the same, if any, had to be registered at Bombay and in fact it was so registered. That is another factor which has got to be looked into in arriving at the conclusion to find out what is the proper law applicable in such a case. (v) Another factor which is very relevant for our consideration is that even after the policy matured, the discharge certificate is to be sent from bombay. The branch office had nothing to do with the same. The claim section of the said company is situated in bombay. The policy of the company has got to be decided by the Head Office in the matter whether the policy is to be accepted and how the money is to be paid. The question of bonus and every such matters are to be decided at bombay. That will appear from the answers given by Mr. Ranadive to the question Nos. 289 to 301. That also shows that the control of the policy was always kept by or with the head office at Bombay. (vi) General practice with regard to the collection of the premiums has been stated by the witness Ranadive in his answer to the question Nos. 16 to 20. He admitted that after meeting the branch expenses, the surplus, if any, would have to be channeled to the head office for investment. That is a very significant statement and shows that the entire money realised both the premiums were under the control of the head office. The surplus, if any, that witness admitted, was physically sent to the head office, and this will appear in answer to the question No. 26. He has further admitted that the said sum so sent, was to be invested by the head office. Mr. Roy Chowdhury drew our attention to the fact that the company had its investment at Dacca and as such it should be considered that they were carrying on business there. In answer to question No. 77 of the said witness it has transpired that the company had investment at Dacca and there was a building which belonged to them. Mr. Roy Chowdhury drew our attention to the fact that the company had its investment at Dacca and as such it should be considered that they were carrying on business there. In answer to question No. 77 of the said witness it has transpired that the company had investment at Dacca and there was a building which belonged to them. That itself is not sufficient to raise a plea in support of the contention that the policy in question lost its Indian character. That witness is unable to say whether any money paid towards the premium of this policy was ever kept back in Pakistan. This is the circumstance which will also have to be considered in deciding this matter. (vii) The entire correspondence which passed between the parties were from head office in Bombay. That shows the policy in question was controlled from the head office and the branch office at Dacca had nothing to do in this respect. (viii) It has been established that, that the head office is situated or located in Bombay. The position of the Company now that of L. I. C. is that of a debtor. This policy having been matured became a chose in action, its situation is to be considered for the determination of the point at issue. Such a point was raised in the case of Found bishara Jabbour v. Custodian of Absentee's property of State of Israel reported in (1954) All. E. R. (Vol. 1) 145. The following observations of their lordships in that case is relevant for our purpose. 'next to be considered is the Situation of the chose in action. It is established by the decided cases, that not only debts, but also other chooses in action are for legal purposes localized and are situated where they are property recoverable and are properly recoverable where the debtor resides. '' such rule has keen formulated by dicey in his book ''conflict of Laws", 9th Edn. at 832. It is established by the decided cases, that not only debts, but also other chooses in action are for legal purposes localized and are situated where they are property recoverable and are properly recoverable where the debtor resides. '' such rule has keen formulated by dicey in his book ''conflict of Laws", 9th Edn. at 832. under Rule 189 Dicey says : (i) A contract of insurance is governed by its proper law; (ii) If an intention to choose the proper law has not been expressed in the insurance policy and cannot he inferred from the circumstances and If there is nothing to show that the contract is more closely connected with another system of law, the contract is governed by the law of the country in which the insurer carries on his business and, if the carries on his business In two or more countries, by the law of the country in which the head office is situated. 19. IF has thus been contended that the sum under the policy is recoverable in Bombay, and that being so, the same is subject to the Law of India. 20. MR. Roy Choudhury, on the other hand, has placed before us the following facts in order to support his contentions that the proper law applicable in such a case is the law of pakistan : (1) Brojendra the creditor was the permanent resident of Pakistan; (2) Ext. the letter written by the Manager of the company to Brojendra would snow that the premise under the policy were paid at Dacca branch; (3) servicing of the policy was done in the Dacca branch office; (4) the policy was attached to Dacca Register; (5) under the foreign Exchange Regulation of India coupled with such regulation of Pakistan, the money became payable at dacca and (6) that the agency of the policy in question was Dacca Rajshahi agency indicating that the policy originated at Rajshahi through the agent of the company who as working at the relevant time there. With regard to the point No. 4 that the policy was attached to the dacca Register there is nothing to show that the said policy was treated as the original policy which originated at dacca and that the same was kept in their Register as such. In this connection the answer given by Mr. Ranadive to question Nos. 25 and 26 may be considered. In this connection the answer given by Mr. Ranadive to question Nos. 25 and 26 may be considered. According to him, the premium money paid at Dacca had to be transferred to the head office. Though mr. Ranadive wanted to say that this policy was served in the' Dacca branch office, he admitted however, that he had never been to Dacca and that he had no personal knowledge as to the same. That will appear from the answers which he has given to the question Nos. 310 to 313. The Register of Dacca branch has not been marked exhibit in this case. Neither any document from the Head Office has been produced to show that the policy in question was not attached to Bombay office but attached to the Dacca Office. 21. FROM the above submissions of the respective parties, it has got to be seen where the transaction in question was closely grouped and the contract out of which the obligation to pay arose has its closest and most real connection in order to ascertain the proper law of the place which can be said to be applicable in this case. In doing so it has got to be seen whether the foreign exchange regulation of India or of Pakistan had any effect on the proper law which might be found to be applicable in the instant case. We have already described the elements or the factors which are to be considered in order to find out the place where the transaction is closely grouped. The same have got. to be looked into, before we come to the conclusion in this respect. We need not narrate those factors or elements over again. 22. THE similar point was raised in the case of Rossano v. Manufactures life Insurance Co. reported in (1963)2 Q. B. 352. That was also a case of insurance. It was the Cairo office of the said company whose head office was located in Toronto, Canada, issued the policy which was payable in sterling on maturity. The final policies were executed at Toronto (Canada) in favour of the assured. The premiums in respect of the sterling policies were paid to the defendant company at Cairo. Under the terms of the policy the parties agreed that the money was to be- paid in Banker's demand drafts on London from pound Sterling. The final policies were executed at Toronto (Canada) in favour of the assured. The premiums in respect of the sterling policies were paid to the defendant company at Cairo. Under the terms of the policy the parties agreed that the money was to be- paid in Banker's demand drafts on London from pound Sterling. There was another policy similarly issued in favour of the plaintiff by the said company which was made payable in Banker's demand draft on New York from U. S. Dollars. The policies all matured on march 15, 1960 and the plaintiff brought an action claiming the money due under them. The defendant relied on the following two defiance. (a) that the proper law of the contract being Egyptian or the sit us of the debt or the contractual place of performance being in Egypt, payment by the defendants would be illegal under the egyptian Exchange Control Law, if effected without the permission of the egyptian Control authorities; (b) other defences which are not necessary to be considered for the purpose of this case. The facts of that case stand pariahs with the facts of this case and almost identical points were raised therein. Mc. NAIR J. applied the test laid down in. the judgment of the Privy council delivered by Lord Simonds in john Lovington Bonython and ors. v. Commonwealth of Australia (1951) A. C. 201 as being the system of law by reference to which the contract was made or that with which the transaction has its closest and most real connection, which principle has also been accepted by majority of decision in the case Re united Railways of Havana and Regal warehouses Ltd. Sub nom. Tomlinson and First Pennsylvanian Banking and trust Co. (1961) A. C. 1007. Mc. Nair, J. weighed the respective factors and was of the view that the factors referred to by the plaintiff tilted the scale in favour of the law of Ontario as the said system of law with which the transaction had its closest and most real connection. For the reasons stated Mc. Nair J. held that the law of Ontario was the proper law. The said finding in this respect is arrived at, not on consideration of a single factor only but' on the consideration of the cumulative effect of all the factors taken together. For the reasons stated Mc. Nair J. held that the law of Ontario was the proper law. The said finding in this respect is arrived at, not on consideration of a single factor only but' on the consideration of the cumulative effect of all the factors taken together. It was also contended on behalf of the defendant that, if Egyptian Law is not the proper law, of the contracts, Egyptian Exchange Control Legislation applies since Egypt is the place of performance. The said contention was not accepted and it was held that Egyptian exchange Control legislation did not apply to the policies merely by reason of sits of the debt being in Egypt, It was further held that in considering what was the place of performance of the contracts, the relevant act of performance was the payment of the policy money and that although Egypt was a permissible place of performance the defendants had not the right to insist on payment only in Egypt and accordingly Egypt was not the relevant place of performance and the Egyptian Control Legislation did not apply. This point requires further consideration which we propose to do in connection with the supervening legislation and its effect on the contract to be performed and on the proper law governing the same. 23. WE may mention here and now that the same consideration which led mc. Nair J. to hold that the transaction had closest connection with the law of ontario, also has weighed with us to hold that the elements of the transaction in question having grouped round bombay, it has closest connection and its real seat is there and as such obligation to pay under the contract should be governed by the law of India. As the very difficult question of Private international Law has been raised in this case, detailed discussions about the same is necessary, which we propose to do hereunder. 24. MR. Roy Chowdhury has relied upon the case of Delhi Cloth and. General Mills Co. Ltd. v. Harnam Singh and others (supra) and submitted that the principles laid down in the said case thoroughly supports his contention that the proper law of the contract should be considered to be the law of Pakistan. In that case also the question of Private international Law was considered. The plaintiffs were the partners of a firm known as Bantam Singh Jagat Singh. In that case also the question of Private international Law was considered. The plaintiffs were the partners of a firm known as Bantam Singh Jagat Singh. Before the partition of India they carried on business of cotton cloth dealers at Lyallpur which is now in Pakistan. The defendant is the Delhi Cloth and general Mills Co. Ltd. Its Head office was situated at Delhi. It had several branches, one of the places at which it carried on business before the partition was Lyallpur. The plaintiffs alleged that they advanced certain money against their purchases and that the sum of Rs. 56,079-56 was paid to the company. The defendant company in their turn delivered cloth worth rs. 43,833-0-0 to the plaintiff against this amount at or about that time. That left a balance of Rs. 11,496-6-6. The suit was to recover' the said balance plus the interest. That suit was decreed and that the said decree was upheld by the High Court. Against that judgment and decree the appeal was preferred in the Supreme Court. The defendant admitted the facts set out above the claim of the plaintiff was resisted. They contended that when India was partitioned on 15. 8. 47 Lyallpur, where these transactions took place and where the money was situate, was allotted to pakistan. The plaintiffs fled to India at that time and thus became evacuees and the Pakistan Government froze all evacuee assets and later compelled the defendant, to hand them over to the custodian of Evacuee Property in pakistan. The defendant was ready and willing to pay the money, if the Pakistan govt. would release it but until it did so the defendant contended that it was unable to pay and was not liable. The facts involved in that case requires to be slated to understand the principles enunciated by their Lordships and It is all the more necessary to be considered as before us that is the only case of the supreme Court of India which has been placed relating the points at issue So that decision requires a fuller consideration Before we enter into the discussion of the points in that case some facts need be stated. At the relevant period before the partition, cloth was rationed and its distribution was controlled. At the relevant period before the partition, cloth was rationed and its distribution was controlled. According to the shame quotas were allowed to different areas and the manufacturers and suppliers of cloth could only distribute their cloth to retailers in accordance with those quotas and the dealers in those areas could only import cloth up to and in accordance with those quotas allotted to them. The plaintiffs were the Government quota-holders for Lyallpur and the defendant company also carried or business there through the General Manager of Lyallpur Mills. Thus it is seen that the plaintiffs contracted in a spaced capacity that was localized at Lyallpur, namely, as the Govt. nominees for Lyallpur the goods were to be delivered at Lyallpur and could not be delivered anywhere else. These are the facts which were considered by their Lordships in coming to the conclusion that the elements of the contract out of which the obligation to pay arose, were most densely grouped at Lyallpur and the it chat was its natural seat and the place with which the transaction had closest and most real confection it followed from that mat the proper law or contract, in so far as that was material was found to be the law. Alter the partition of India ordinance was issued by Pakistan government freezing all assets of the evacuees and compelled them to land them over to the Custodian or decease Property in Pakistan. Under the terms or the defendant company was also forced to pay the dues payable to the plaintiff to the Custodian or Evacuee Property of Lyallpur. It was argued before their Lordships that as Lyallpur was part or India when the con treat was made the Indian law must be applied and that no different trenton of be input to the parties. Their Lordships were of the view that the proper law would be the law of lyallpur applied as a living and changing whole and these could have been, the case even if India had not been divided because each State had the right to make deferent laws even in undivided India Mr. Roy Chowdhury has asserted that on the said principle the proper law guiding the contract in question. should be the proper law of Pakistan modified or varied by the Foreign Exchange Regulation of pakistan passed in the year 1947. Roy Chowdhury has asserted that on the said principle the proper law guiding the contract in question. should be the proper law of Pakistan modified or varied by the Foreign Exchange Regulation of pakistan passed in the year 1947. It has been asserted that as money was paid by the plaintiff at Lyallpur and the goods were delivered there, similar in the instant case the premiums were paid at Dacca and that dacca Branch office was responsible in dealing with the said policy, the proper law governing this contract should be the proper law of pakistan. In support of the said contention the following factors were placed before us, namely. (1) Brojendra lived at Rajshahi or in other words, he was a resident of Pakistan at the relevant time. (2) Ext. 9, the letter already referred to shows that the premiums were paid at dacca branch. (3) the policy in question was borne out at Dacca or it was attached to Dacca Register; (4) servicing of the policy was done there. On the parity of reasoning their Lordships with regard to the facts involved in delhi Cloth Mills case it was contended that the proper law is the law of Pakistan. It is known that the proper law is a living and changing whole. It changes or moulds or varies with the changes of circumstances and the changes of local lawn Mr. Roy Chowdhury further submitted that the said proper law should be controlled by Foreign Exchange regulation which was a supervening legislation passed by Pakistan. Mr. Ghosh, on the other hand, has submitted that the performance of he contract in this case was at Bombay. According to Mr. Ghosh, lex loci contracts and lex loci solutions were both located at Bombay. Accordingly, this is a case the facts of which are different from the case which was considered by their Lord shins in the case, reported in 1954 S. C. 592. Supervenient legislation as passed in the place which modifies or changes the proper law becomes part and parcel of the state law. Accordingly, the Foreign Exchange Regulation of india had its effect on the contrast under our consideration, but the said law does not restrict any payment of the money covered by the policy to the plaintiff in any way. Supervenient legislation as passed in the place which modifies or changes the proper law becomes part and parcel of the state law. Accordingly, the Foreign Exchange Regulation of india had its effect on the contrast under our consideration, but the said law does not restrict any payment of the money covered by the policy to the plaintiff in any way. Accordingly, the principle which has been enunciated in the case decided by their Lordships in the Supreme Court applies fully to the facts of this case also. Their Lordships considered the Private International law and was of the view that the first and foremost consideration in such cases is to find d out what is the proper law guiding the contract. It has elaborately been dealt with by us and we have also applied the said principle in this case. 25. I order to find what should be the proper law, their Lordships held in the above mentioned case, the court should at first find from the elements of the contract, out of which the obligation to pay arose, the place where the same are most densely grouped and whether that is its natural seat with which the transaction has its closest and most real connection. Applying the said principles we are of the view that the transaction in question has its closest connection with the law of India and as such the law of India in the proper law, applicable in this case. Mr. Roy Chowdhury submitted that on a party of facts, that the laws of Pakistan should be taken as the proper law governing the contract in question. We are sorry we cannot accept the said contention the facts involved in that case is distinctly separate than the one under our consideration. Though the principle of law enunciated in the above mentioned case, guides and governs such a case. but the facts connected therein being separate and distinct, the conclusion to which we are asked to arrive, is not acceptable to us. For the reasons stated the contentions of Mr. Roy Chowdhury must fail. It has been held that the proper law applicable to the contract is the law of India. Does it resolve the problem? Various other considerations are connected with the problem which still now remains unresolved. When the intention of the parties to a contract regarding to the law governing it, is not expressed. Roy Chowdhury must fail. It has been held that the proper law applicable to the contract is the law of India. Does it resolve the problem? Various other considerations are connected with the problem which still now remains unresolved. When the intention of the parties to a contract regarding to the law governing it, is not expressed. Court not as to find such a case but also to consider whether the fame changes or is affected under the circumstances mentioned hereunder : (i) The proper if subject to modification. alternation and change by the Supervenient leg station; (ii) If the contract requires performance of an obligation in foreign country if by the law of that country its performance is illegal and whether this court as a mailer of public policy will not enforce that contract; (iii) Irrespective of private international law whether contract is hit by the International Monetary Fund and bank Act, 1945. Lastly it has go be seen whether the Indian Foreign Exchange Regulation Act gives any defence to the action. The above principles have very nicely been summarized in Rule 175 of diceys. The conflict of laws (9th edition) which runs as follows: rule 175 (1) A contractual obligation may be invalidated or discharged by exchange control legislation if- (a) such legislation is part of the proper law of the contract or (b) it is part of the law of the place of performance or (c) it is part of English law and the relevant statute or statutory instrument is applicable to the contract. Provided that foreign exchange control legislation will not be applied if it is used not with the object of protecting the economy of the foreign State, but as an instrument of oppression or discrimination. (ii) Whatever is their proper law wherever the to be performed, enforceable if they involve the currency of any member of the International Monetary fund and if they are contrary to the exchange control regulations of any member maintained or imposed consistently with the International Monetary Fund Agreement, (semble) what is the object for which these regulations are used. 26. (ii) Whatever is their proper law wherever the to be performed, enforceable if they involve the currency of any member of the International Monetary fund and if they are contrary to the exchange control regulations of any member maintained or imposed consistently with the International Monetary Fund Agreement, (semble) what is the object for which these regulations are used. 26. WE propose to discuss the first point noted above, that in the absence of any intention of the parties as to the law governing the contract, the proper law governing such a contract: is to be found out first and the effect of the supervenient legislation, if any, is to be considered next. It has been urged on behalf of the appellant that even if indian law is the proper law, the Pakistan Foreign Exchange Regulation is the supervenient legislation passed and due to the said regulation, the contract, in question cannot be enforced. In support of the said contention our attention has been drawn to the decision in the case of Halberd Wage and Co. Ltd. reported in (1956) 1 All. E. R. 129. The facts, in short, of that case is as follows : a German Company raised loon from a company incorporated in England. Term of payment in sterling in london. War Broke. A moratorium law was passed in Germany providing that loans etc. payable by a German must be paid in Konversionskasse in reichsmark such payment would discharge the debtor from the debt. The debtor company paid the amount as. directed in the moratorium law. The debt was satisfied. The English company started a proceeding for realisation of the money. The Administrator of the German Enemy Property Act held that the debtor company discharged his debt under the provisions of moratorium law, as such nothing remained to be paid. The debtor company paid the amount as. directed in the moratorium law. The debt was satisfied. The English company started a proceeding for realisation of the money. The Administrator of the German Enemy Property Act held that the debtor company discharged his debt under the provisions of moratorium law, as such nothing remained to be paid. In appeal the said judgment was upheld and following principles of law emerged from that decision : (i) the moratorium law applied to the debt since- (a) the power of legislation to affect a contract by modifying or annulling its terms depended on the proper law of the contract, and not on the local situation of the debt, (b) the proper law of the loan agreement was German Law, (c) moratorium law would be recognised by the Court in England in relation to a contract of which proper law was German, since the court was satisfied that the moratorium law was German Foreign Exchange Control Legislation passed for the protection of its economy. That decision, though an authority to the principles laid down for finding the proper law of the contract, the same is not applicable in the instant case. That is a case, wherein the English Court refused to enforce the contract on the ground that the proper law was the German Law and that german Foreign Exchange Control Legislation was applicable to that contract. In the instant case we have held that Indian law is the proper law of the contract and the Indian Law regulating the foreign exchange passed for the protection of its economy should be given effect to, as such, in our view there is no bar to enforce that contract in this proceeding. 27. THE next case cited is the case of Zivnostenska Bank National corporation and Frankman reported in 1950 A. C. 57. On the facts of that case, it was held that the place of performance of the obligation under the contract was at Czechoslovakia and as permission of the National Bank of Czechoslovakia was necessary under the Czech Foreign Exchange Law of 1944, and as there was no such permission, the bank could not legally deliver up the debentures. On the facts of that case, it was held that the place of performance of the obligation under the contract was at Czechoslovakia and as permission of the National Bank of Czechoslovakia was necessary under the Czech Foreign Exchange Law of 1944, and as there was no such permission, the bank could not legally deliver up the debentures. The said decision also has got no application in this case inasmuch as it has been found that the proper law is the law of India and not of Pakistan governing the contract and the place of performance of the contract is at Bombay and not at Dacca. 28. OUR attention has also been drawn to the decision in the case of Delhi Cloth Mills (supra) in order to show that the claim of the plaintiff therein was refused as in the meantime supervenient legislation forbiding payment of any money to an evacuee was passed. The decision of that case has been discussed in details while considering what proper law should be made applicable in this case. As we have found that the proper law governing the contract, is the law of India and as there is nothing, forbidding such a transaction in the Foreign Exchange Regulation of India, the claim of the plaintiff is not liable to be dismissed. This point has been raised on behalf of the appellant, and it has been asserted that the proper law of the contract is the law of Pakistan and due to passing of the Foreign Exchange Regulation of Pakistan, the assignment of the policy by Brojendra in favour of Rabindra was illegal arid no effect should be given to the same. The said submission of the appellant is not acceptable to us for the reasons stated hereafter. It is well established that proper law guides all the rights and obligations of the parties under the contract, and the following are the exceptions namely the said contract is subject to change, variation and modification by the supervening legislation of the place, the proper law of which guides the contract and its obligation. This has already been discussed above and it has been held that supervening legislation of the place of the proper law is attracted to the contract in question. This has already been discussed above and it has been held that supervening legislation of the place of the proper law is attracted to the contract in question. In the instant case, we have already held that the law of India is the proper law, and in consequence there to the foreign exchange regulation of India is applicable in the instant case as the place of performance of the contract is Bombay. 29. SECOND exception to the general rule to that proper law guides all the rights and obhgation of the parties under the contract, is that if a contract requires the performance of an obligation in a foreign country and such performance in the foreign country is illegal by the law of that foreign country, then courts of India or in other words the courts of the country of which proper law is applicable, will not enforce that performance as a matter of public policy. A strenuous argument has been advanced on behalf of the appellant to the effect that the performance of the obligation under the contract will infringe the laws of Pakistan and in that case, the Pakistan Government might have occasion to complain, as such the said obligation of the appellant to pay the money should not be enforced at least on the ground of public policy. That is a very sound principle of law and specially in this age, every civilised country and its Government should pay respect to the laws of that country where the contract or any obligation under the contract is to be performed. The necessary corollary of the above mentioned principle is that a contract is in general, invalid in so far the performance of it is unlawful by the law of the country where the contract is to be performed. In support of the said contention reference has been made to the case of Rallis Brothers v. Company naviera Sota Yazar, reported in (1920) 2 KB. 287 on behalf of the appellant. In that case under the contract, a cargo of Jute from Calcutta to Barcelona at a freight of 50. per ton, one half to be paid to the owners in London on me vessel sailing from Calcutta and the balance to be paid at Barcelona by the recovers of the cargo, as to one half on arrival of the steamship and the remainder concurrently with the discharge. per ton, one half to be paid to the owners in London on me vessel sailing from Calcutta and the balance to be paid at Barcelona by the recovers of the cargo, as to one half on arrival of the steamship and the remainder concurrently with the discharge. The freight payable at Barcelona was to be paid in cash on approved bills at character's option at the current rate of exchange for banker's short bills on London. Half of the freight was duly paid. But a decree of the Spanish commission of supplies, dated July 2, 1913, confirmed by a Royal proclamation of September 14, 1918 the freight on jute was not to exceed 875 pesetas per ton. The receivers of the cargo at Barcelona tendered the balance of the freight at the rate of 875 pesetas per to but refused to pay the balance of the freight reserved by the charter party. The Spanish owners, thereupon claimed to recover the balance of the freight from, the character in England, notwithstanding that it exceeded the freight limited by Spanish law. The court of appeal held that though the proper law guiding the contract was the laws of England, that part of the contract to be performed at Barcelona a part of Spain. could not be enforced as it would have infringed the law of the country where the contract was la be performed by making the payment of the balance of freight there. White delivering the judgment Scrutiny LJ. observed : "i should prefer to state the ground that where a contract requires an act to be done in a foreign country, it is, on the absence of very special circumstances, an implied term of the continuing validity of such a provision that the act to be done in the foreign country shall not be illegal by the law of that country. This country should not in my opinion, assist or sanction the breach of law of other independent states. The later part of the observations of his Lordship supports the theory boat each country of the international committee must have respect to the law of other countries. " 30. MR. This country should not in my opinion, assist or sanction the breach of law of other independent states. The later part of the observations of his Lordship supports the theory boat each country of the international committee must have respect to the law of other countries. " 30. MR. Roy Chowdhury while developing that proposition of law, further contended that even if the proper law is the law of India, and the place of performance of the contract is at Bombay, its performance will infringe the law of Pakistan, as such it debars the court to enforce the same on the principle of public policy. Such an extension of that ride is not contemplated. The place of performance of the contract is relevant. As such the count will see first, where any obligation order the contract is to be performed and in so doing, if the foreign law is infringed, then the court will refrain in passing any decree on the rule of public policy. It has however, been held that the place of performance of the contract is found to be Bombay, as such the question of infringement of any law of the foreign country does not arise in this case. Therefore, there is no such impediment in passing any decree on that score, in this case. Let us consider another decision placed before us on behalf of the appellant in support of their contentions that the performance of the obligation under the contract would infringe the law of the foreign country, i. e. of pakistan, as such no decree should be passed. That is a decision in the case of Foster v. Driscoll and others reported in (1929) 1 K. B. 470. In that case a very interesting point was raised. The genesis of that case tested on the violation of the laws of the United States of america under the following circumstances : a ship loaded with a cargo of whisky to be earned across the Atlantic and to be sold in the United States or at some point from which it could easily be smuggled into the United States in terms of that contract such a ship with the said cargo was sent, but the same could not reach its destination. On an action for realisation of the dues, the majority of Judges (Lawrence and sankey L. J. J.) held : "that the object to be attached by this agreement being a breach of international comity, the agreement was contrary to public policy and void. " While delivering the judgment Lawrence L. J. observed : "the ground upon which I rest my judgment that such a partnership is illegal is that its recognition by our courts would furnish a joint cause for complaint by the United states Government against our Government (of which partners are subject) and would be contrary to our obligation of international comity as now understood and recognised, and therefore, would offend against our notions of public morality. " This principle is based on fundamental juristic problem in private international jurisprudence. The application of foreign law is regulated by public policy as will appear in Ragazzoni v, k. C. Seth a repotted in 1958 A. C. 301, where the court reused to enforce a contract which was otherwise valid but whose unexpressed object was to violate the provision of law in foreign country. In all such cases the performance of those contracts were to be made in the soil of those foreign country. But to such case is contemplated that the performance of the obligation of a contract, in accordance to the proper law or that country may violate some of the laws of the foreign country. The theory if extended up to that limit, will interfere with the laws of the country where the contract originated and to be performed. The said views get support from another decision in De Beeche and others and The South American Stores ltd. reported in (1935) A. C. 148. In that case also the payment of rent was to be made at Child to be forwarded to london. The Chilean Legislation made it impossible for the rents to be paid as directed, as the mode of payment involved international exchange transaction within the meat ring of Chilean legislation. In that case also, the part of the contract was to be performed at chile. 31. IN the distant case the obligation under the contract is to be performed in India and no part of that obligation is to be performed in pakistan, as such the said rule of 'public policy has got no application in this case. In that case also, the part of the contract was to be performed at chile. 31. IN the distant case the obligation under the contract is to be performed in India and no part of that obligation is to be performed in pakistan, as such the said rule of 'public policy has got no application in this case. The same principle has also been enunciated in the case of Kleinwort sows and Co, v. Ungarischr Baumwollr industry Aktiengesellschaft reported in (1939) 2 K. B. 578. In the faces of that case it was held that the proper taw of the contract was English law and that since the contract was to be performed in England, it was enforceable in the English courts, even though its performance might involve a breach by the defendants of the law of Hungary. 32. MR. Roy Chowdhury submitted that the principle of public policy should be applied even in the case where pakistani law would be infringed though the money is to be paid in Bombay as per term of the contract. The attempted extension of the principle would obviously lead to preposterous results. We cannot explain the position in a letter way than what has been done by mackinnon L. J. in delivering the judgment in the above mentioned case. His lordship gave the following example to show tire absurdity of the proposition that in any view of the matter, the court should refuse to pass any decree if in doing so, any foreign law is infringed, no matter, where the payment as per contract is made : "suppose the Kingdom or Legislature of Rumanian passed a law that no rumanian subject should pay a hotel bill which he had incurred in england. When the Rumanian subject was sued in the county court by the hotel proprietor the county court Judge, if that principle be correct, would have to give judgment for the defendant. That seems to me obviously absurd and i do not think I need discuss the matter any further," It has also been contended on behalf of the appellant that the proper law governing she contract, should be held to be the law of Pakistan, and as its performance on the strength of the deed of assignment Pakistan is illegal, this court should not enforce the same. In support of that contention the decision in the case of Kahler v. Midland Bank Ltd. reported in (1950)A. C. 24, has been cited Since we have held that the proper law governing the contract in question is the law of india and its place of performance is also in India that decision therefore, has got no application in this case. Though the principles of law decided therein. cannot be doubted. 33. WE now refer to the third exception to the general rule that the obligation to pay under a contract is generally governed by the proper law of the said contract. The said exception arises for our consideration under the heading "bretton Woods Agreement of 1945". 34. MR. Roy Chowdhury has contended that the transaction having offended the currency regulation of Pakistan it should not be enforced in the court of India. In support of this contention our attention has been drawn to Bretton Woods Agreement and the act made there under. As per terms of that agreement the International Monetary Fund and Bank Act 1945 was passed. Similar Act is stated to have been passed in Pakistan. In the schedule under section 5 of the said act, some provisions have been made which shall have force of law. Part I under the heading of Fund Agreement, paragraph (b) of section 2 of Art. VIII is as follows : "exchange contracts which involve the currency of any member and which are contrary to the exchange control regulations of that member maintained or imposed consistently with this Agreement shall be unenforceable in the territories of any member. " India became the member of the said International Monetary Fund on the 27th December, 1945 whereas pakistan became member of the said fund on July 11, 1950. As both the countries are members of the International Monetary Fund the currency regulations which have been passed by the respective countries out to be respected. The effect of Bretton Woods agreement on the member countries, who are parties to the said agreement has been considered by Dicey in the "conflict of laws" 9fh Edition at page 919. While dealing with the same, the law as stood in the United Kingdom as a member of the International Monetary Fund has been discussed. The effect of Bretton Woods agreement on the member countries, who are parties to the said agreement has been considered by Dicey in the "conflict of laws" 9fh Edition at page 919. While dealing with the same, the law as stood in the United Kingdom as a member of the International Monetary Fund has been discussed. It has been observed : "united Kingdom is a member of international Monetary Fund and the international Monetary Fund Agreement commonly known as Bretton woods Agreement is part of English law Under it "each country will re-spec currency law of the other," 35. CONSIDERING the position of the respective countries i. e. India and Pakistan with regard to exchange on facts which, undoubtedly mean any contracts which affect a country exchange resources, we are of the view that the laws enacted to safeguard the exchange resources of those respective countries, which were enacted as Foreign Exchange Regulation Act, should be respected. 36. MR. Ghosh has on the other hand, submitted that the International monetary Fund and Bank Act 1045 passed on the basis of United Nations, monetary and Financial Conference held at Bretton Woods in July 1914, has got no application in the instant case. Firstly, is has been submitted that the insurance policy cannot be said to be an exchange contract. The insurance policy in question originated in the year 1932. It was a policy to which question of exchange currency of any other country was rot Involved. Even if it is taken as a contract that does not touch the currency of any foreign country. The policy was made Bombay and the money payable there under is the Indian currency and as such the question of exchange contract does not arise in this case. Further it has been submitted that after the assignment of the said policy, the contract if any has gore out of the realm of contract and has entered into the domain of Transfer of Property Ac and in this particular case it is being governed by section 38 of the Insurance Act. Accordingly, a statutory right has been acquired by the plaintiff to en-farce the payment under a title which he derived under the valid assignment of the said policy in his favour. Accordingly, a statutory right has been acquired by the plaintiff to en-farce the payment under a title which he derived under the valid assignment of the said policy in his favour. Secondly, it has been submitted that if payment is made by L. I. C. to the plaintiff on the basis of the deed of assignment, no part of exchange control regulation of Pakistan would be violated. We have dealt with this matter extensively and we are of the view that the transaction in question did not offend any of the provisions of the Foreign Exchange Regulation of Pakistan. The security, under our consideration is a foreign security with reference to pakistan. We have held that the deed of assignment has not contravened any of the provisions of the Pakistan regulation. In this view of the matter art. VIII under section 2, Paragraph (b) of the Fund Agreement cannot be a car in enforcing the payment under the policy. For the reasons stated the contentions of Mr. Roy Chowdhury that the document of the plaintiff is unenforceable in the court of law as it hits the Foreign Exchange of Pakistan. is not sustainable. 37. THIRDLY, it is seen that a resident of India has brought this suit on the cause of action which arose in India against a person a resident of India. in that view of the matter the question of infringement of any of the provisions of Art. VIII of the Fund Agreement does not arise. 38. MR. Roy Chowdhury has drawn cur attention to the provisions of section 4 of the Pakistan Foreign Exchange regulation in support of his contentions that the deed of assignment has infringed the provisions of the said section. Sub-section (1) of Section 4 does not contemplate any transaction as a deed of assignment. Plain meaning of the said section excludes such a transaction from the mischief of that section. It bars a resident of Pakistan to buy or borrow from or sell or lend to or exchange with, any person not being a authorise dealer any foreign exchange. "assignment" does not come within the categories of such transactions. In thus connection we may refer to the provisions of section 4 (1) of foreign Exchange Regulation of India. It speaks of persons resident of India. are debarred to buy or otherwise acquire or borrow from. "assignment" does not come within the categories of such transactions. In thus connection we may refer to the provisions of section 4 (1) of foreign Exchange Regulation of India. It speaks of persons resident of India. are debarred to buy or otherwise acquire or borrow from. or sell or otherwise wise transfer or lend to or exchange with it, outside India in foreign ax-change. The terms "otherwise acquire" and "otherwise transfer" are wanting in the Foreign Exchange Regulation of Pakistan. Indian regulation in that respect may comprehend a case of assignment but such a case cannot be contemplated under the provisions of Pakistan Regulation. In this connection our attention has been drawn to the case of Sharif v. Azad reported in (1967)1 Q. B. 605. That was a case which involved a financial operation of a man called Latif who was ordinarily a resident of Pakistan. He had a bank account with habib Bank of Karachi on which he could draw rupees but he could not take these rupees out of Pakistan, nor could he exchange them for sterling. He could do none of those things unless lie got permission from the authorities tin pakistan. 39. IN 1964, Latif came on a short visit to England and wanted sterling. He met one Pakistani named Md. Sharif who was living in England. Latif got Sharif to give him 300 in cash and in return Latif gave Sharif a cheque of Rs. 6,000/- drawn on the habib Bank in Karachi. This cheque was signed by him but the payees name was left blank. Sharif took this cheque to another Pakistani called abdulla Azad. He was a travel agent in england and arranging passages for pakistanis. Azad accepted the cheque of 6,000 rupees. He or on his behalf somebody filled in the name of the payee as his brother, A. H. Azad who was living in Pakistan. Abdulla Azad sent the cheque out to his brother in pakistan to collect the amount of rs. 6,000 from the Habib Bank in Karachi. In return for this cheque Abdulla azad gave Sharif a sterling cheque for 300 drawn on William Deacons Bank in Manchester signed by Abdulla azad in favour of Shariff. He postdated this sterling cheque because he wanted to see if his brother got the rupees out of the Habib Bank in Karachi. 6,000 from the Habib Bank in Karachi. In return for this cheque Abdulla azad gave Sharif a sterling cheque for 300 drawn on William Deacons Bank in Manchester signed by Abdulla azad in favour of Shariff. He postdated this sterling cheque because he wanted to see if his brother got the rupees out of the Habib Bank in Karachi. His brother did not get the rupees clear into his own pocket. The authorities in Pakistan seem to have been suspicious about this cheque. They did not allow it to be paid to the brother A. H. Azad. It was placed in a "blocked account" Habib Bank though honoured the said cheque but did not allow his brother A. H. Azad to use the same without the permission of the authorities in Pakistan. When this fact came to the knowledge of Abdulla Azad in Manchester that his brother could not get the said sum Rs. 6,000. He stopped payment of the sterling cheque of 300. Sharif sued Abdulla Azad on the cheque of 300. Abdulla's defence was that the transaction was illegal as it violated the provisions of Pakistani Laws and that Sharif the plaintiff would not get any decree. 40. IN that connection the notice of the court was drawn to Bretton Woods agreement. Lord Denning M. R. considered this aspect of the defence taken by Azad. His Lordship was of the view that the cheque drawn by Latif for 6,000 rupees offended the currency regulations of Pakistan. It was a flagrant breach of section 5 (1) (e) and (f)of Pakistan Regulations. In that view of the matter His Lordship observed that the said transaction could not be enforced in England equally in Pakistan and that the authorities had very rightly refused to allow the payee to use the sum covered by the said cheque. His Lordship was also of the view that the Pakistan authorities may consider even to initiate prosecution under the regulations. But the cheque drawn by Abdulla Azad in favour of Md. Sharif did not offend against the currency regulation of Pakistan at all. Such regulations affect the person in pakistan or resident in Pakistan such as Lath himself or the brother of A. H. Azad but they did not affect the person resident in England. In that view of the waiter Sharif was allowed to enforce the sterling cheque for 300 against Abdulla. Such regulations affect the person in pakistan or resident in Pakistan such as Lath himself or the brother of A. H. Azad but they did not affect the person resident in England. In that view of the waiter Sharif was allowed to enforce the sterling cheque for 300 against Abdulla. On that principle even if Brojendra by his transaction laws and regulations, the transaction which prig anally took place in India and when the contract was for payment in Indian money at Bombay and as Rabindra a resident of India, claimed the same from other resident in India, there will be no violation of Pakistan regulations, in case such payment is enforced in India. Accordingly, in our view we do not find any reason for which bretton Woods Agreement or in consequence where of the Act passed on the basis would stand in any way against granting any relief to the plaintiff under the transaction in question. The decision referred to above docs not go against the plaintiff in any way specially in view of the fact that the original contract for payment, in Indian currency at Bombay was entered into at Bombay when India was undivided and that the Head Office of the said insurance company still now P. situated at Bombay. Let us now look to another decision in the case of Frankman, v. Anglo-Prague Bank reported in (1948) 1 all E. R. 337. In that case a proceeding was started in the English Court. The defendant Bank asserted that the place of fulfillment and payment and the only place where the claim in question could be asserted, was Prague. There was prohibition for transfer of debentures without the permission of the National Bank of Czechoslovakia. The Brett on Woods Agreement was signed both by Great Britain and the republic Czechoslovakia. On the basis of the said agreement it was held that: (1) the London Branch of the bank was not a separate entity and the Brogue batik were the only parties from whom the plaintiff could seek satisfaction. (ii) the contract was to be performed in Prague in accordance with czechoslovakian law, and, as the refusal of permission by the National Bank made the contract unenforceable in that country, the contract could not be enforced in an English Court. (ii) the contract was to be performed in Prague in accordance with czechoslovakian law, and, as the refusal of permission by the National Bank made the contract unenforceable in that country, the contract could not be enforced in an English Court. Keeping the said decision in view, we find the said observations of their Lordships do no go in any way against the plaintiff in this case. The contract was entered into in India and the money is to be paid in Bombay. So the place of performance of the said contract is undoubtedly in the country where the contract originated. In the absence of anything to show that it violates any provision of exchange regulation of Pakistan, there is no bar for the plaintiff to get any decree. 41. THUS result of our finding is that such an agreement cannot be said to be unenforceable in the court of law for the following reasons : (i) the said provision does not apply in the case of assignment; (ii) the transaction in question does not "all within exchange contract; (iii) the transaction in question does net involved any foreign exchange of pakistan and (iv) it does not violate any Pakistani Foreign Exchange Regulation. 42. WE shall next consider whether the transaction in question has violated any provisions of the Foreign Exchange regulation of India. It has already been observed that none of the provisions of sections 5 or 13 of the said regulation has been violated by the deed of assignment executed by Brojendra even if he be considered to be a resident of Pakistan. Such a question does not arise even in the instant case, which has been started by a resident of India against another resident of India fat-enforcement of the claim payable in india in Indian currency. Another important point which had arisen in this case for our consideration, is whether Brojendra can be said to be a resident of India at the relevant time. We have already held that the law of India is the proper law-governing the contract and its performance is also confined in India therefore the supervening legislation such as Foreign Exchange Regulation Act 1947 of India, being part of that proper law, is applicable in this case. The reasons of such finding will further appear from our discussion made hereunder. We have already held that the law of India is the proper law-governing the contract and its performance is also confined in India therefore the supervening legislation such as Foreign Exchange Regulation Act 1947 of India, being part of that proper law, is applicable in this case. The reasons of such finding will further appear from our discussion made hereunder. We have also considered whether any part of Pakistan Foreign Exchange Regulation Act, has got any application in this case. For the reasons stated hereafter we are of the view, that none of the provisions of that Act, is applicable in this case. In this connection we shall consider the question posed as to whether the Indian Foreign Exchange Regulation gives any defence to the appellant to defeat the claim of the plaintiff respondent. Let us therefore, start with the deed of assignment, Ext. B. In this connection the first and foremost question that arises for consideration is whether the deed of assignment, Ext. B, executed by Brojendra in favour of his son, the plaintiff is a legal and valid one. 43. THE power to transfer the policy by assignment was reserved in the policy itself. Moreover under section 38 of the Insurance Act (Act IV of 1938) the power of assignment of such a policy has been provided for Ext. B fulfils the conditions required for such an assignment. Sub-section 5 of that section provides that on the completion of the formalities of such a transfer, the insurer from the date of the receipt of the notice referred to in sub-sec. (2), should recognise the transferee or assignee named in the notice as the only person entitled to the benefit under the policy. Normally, the said deed of assignment completely establishes the plaintiff's right to realise the sum covered by that policy. 44. WE shall have to consider whether that position has in any way been changed after partition of India. The question is what is the rule of Private international Law in such a case of voluntary transfer. There is no dispute that the money payable under the deed of assignment is a debt and as such a property or in other words it is a chose in action. It is thus heritable and assignable and under section 130 of Transfer of property Act it is transferable. There is no dispute that the money payable under the deed of assignment is a debt and as such a property or in other words it is a chose in action. It is thus heritable and assignable and under section 130 of Transfer of property Act it is transferable. In the context of changed circumstances, let us examine, whether such assignment is valid or it could have been made under the law of Pakistan. As it is a very complicated question, let us examine the provisions of the English law to ascertain under what law such a document should be subjected. According to Dicey's The Conflict of laws (9th Edition) page 547 : "rule 83-The question whether a debt or other intangible thing is capable of assignment, and if so under what conditions (so far as they affect the debtor) is governed by the proper law of the debt or the law governing the creation of the thing. Rule 84-Subject to Rule 83 and to the exception hereinafter mentioned, the intrinsic validity of an assignment of a debt or other intangible thing as between the assignor and the assignee is governed by the proper law of the assignment. " Exception : -An assignment which is formally valid by the law of the place where it is made (Lex loci actus)though not by its proper law, is formally valid in England. Cheshire, while discussing this matter, to ascertain the law validly applicable in such a case found difficulty to mention a particular formula to solve the problem. He in his book on private International Law (9th Edition) at page 538 observed under the heading "the various Theories". The following are the various theories which have been propounded in this connection : The law of the place where the creditor is domiciled the law of the place where the debt may be said to have an artificial situation, the law of the place where the assignment is made the proper law of the assignment and the proper law of the transaction that created the debt: All these legal systems have found support from their advocates. West lake having asserted that assignments of Corporeal moveable are governed by the lex situs, maintains that the forum for the recovery of a debt presents a close analogy to the situs of a corporal moveable, and stands the english rule to be that "the assignee who has acquired a good title by the law of the forum for the recovery of the debt must prevail. " Such a question was raised in the case Re Queensland Mercantile and Agency Co. (1891)1. Ch. 536. In that case a question of priorities between two assignees was raised. The Union Bank contended that the question fell to be decided by the law of Queensland since the queensland company was a creditor in respect of unpaid shares and any assignment by it must be tested by the law of its domicile. North J. however applied Scottish law and His Lordship was of the view that since the debtors were resident in Scotland and therefore unpaid calls which formed the subject matter of the assignments were situated in that country, the law of Scotland would be applicable in that case applying the theory of Lex Loci situs. The said principle has also been accepted by our Supreme Court in the case of State Book of India v. Ghamandi ram, reported in A. I. R. 1969 s. C. 1330 and their Lordships held that the same legal position prevailed in india. Though the said observation has been made in the case of involuntary assignment, we are of the view that the same is also applicable with all its force in the case of voluntary assignment as well. It has already been noted that the debt is payable in bombay that is to say, the situs of the debt is located in Bombay. For the reasons stated, as the assignment has been made by the law of the place where the debt is situated, the said deed of assignment is legal and in all respects valid. That apart in the instant case, there arises no difficulty. The debt is payable in Bombay, the head office of the company is situated there, the deed of assignment was executed in Calcutta, that is in accordance with the law of India. That apart in the instant case, there arises no difficulty. The debt is payable in Bombay, the head office of the company is situated there, the deed of assignment was executed in Calcutta, that is in accordance with the law of India. In addition to that we have already held that the Pakistani law is neither the proper law controlling the obligation arising out of that contract, in the policy in question, nor Pakistani law is the law of performance of the contract. For the reasons stated we find that the deed of assignment, Ext. B, is a legal and valid document. 45. IT has been urged on behalf of the appellant, that the said deed of assignment should not be enforced as the same was obtained to circumvent the laws of Pakistan as embodied in the Pakistan Foreign Exchange Regulation 1947. 46. ONLY relevant section which might have some bearing is section 13 of the Pakistan regulation. According to the appellant, sections 13 (1) (b) and 13 (1) (c) and 13 (4) of that regulation are relevant. It is contended that the assignment of the policy has been made in violation of those provisions, as such the said deed being a void one, should not be enforced in a court of law. On behalf of the respondent it has been contended that the term 'security' as mentioned in that section means, the 'security' which originated in Pakistan or in other words, it means a local security, as such the said provisions cannot extend to a foreign security, as is involved in this case. Mr. Roy Chowdhury, faced with this problem tried to explain the same by asserting that the terms 'security' should be considered as a genus and 'foreign security' as a specious. The said biological concept of 'genus' and species is hardly applicable in the facts of this case, and specially in view of the provisions of law, where each term security and foreign security' has separately been defined, attaching special meaning to each of them. Let us now examine those definitions : Section 2 (e)defines 'foreign security': it means any security issued elsewhere than in Pakistan and any security the principal of or interest on which is payable in foreign currency or elsewhere than in Pakistan. Let us now examine those definitions : Section 2 (e)defines 'foreign security': it means any security issued elsewhere than in Pakistan and any security the principal of or interest on which is payable in foreign currency or elsewhere than in Pakistan. Section 2 (k)defines "security" : it means shares, stocks, bonds debentures, debenture stock and Government securities as defined in the Securities act, 1920, deposit receipt in respect of deposits of securities, and units or sub units of unit trusts, out does not include bills of exchange or promissory notes other than Government promissory notes. Section 13 (5) (c) further enlarges the scope of 'security' as defined earlier. It is as follows : 'security' also includes coupons or warrants representing dividend or interest and life or endowment insurance policies. The cumulative effect of the definition of 'foreign security' and 'security' as. noted above clearly makes a difference as to the security originating in Pakistan and security originating in foreign countries. The above definitions of 'security' and 'foreign security' unmistakably show that those transactions are different in kind and in character. In our view, the regulation of export and transfer of securities, as contemplated in section 13 of the Act, of Pakistan, contemplates only the domestic securities, that is, the securities which originated in pakistan. In the instant case, the security originated in India and the terms of the policy lay down that the money in India currency would be payable at bombay, a part of India. The above policy therefore fulfills the ingredients of the definition of 'foreign Security' S. 13 of the Pakistan Act does not contemplate any transaction relating to 'foreign security'. This conclusion of ours gets support from the fact that the authorities in India felt difficulties in this regard and they restricted the acquisition, holding or disposing of any foreign security by incorporating sub-clause (e) in sub-section (1)of Section 13 of the Act. The said change has been made by Amendment act XXXIX of 1957 long after the assignment in question was made. We have not been shown any such corresponding section in Pakistan Act. For the reasons stated we find that the restrictions regulating export and transfer of security as laid down in section 13 of the Act do not apply in the instant case. 47. THE policy in question originated in Bombay, money payable under that policy is also there. We have not been shown any such corresponding section in Pakistan Act. For the reasons stated we find that the restrictions regulating export and transfer of security as laid down in section 13 of the Act do not apply in the instant case. 47. THE policy in question originated in Bombay, money payable under that policy is also there. Therefore, it is a foreign security. There is no restriction in the Pakistan regulation against such transfer of foreign security. Correspondingly we do not find any restriction imposed on a resident outside India to make any transfer of indian security in favour of a resident of India. 48. GREAT stress has been laid on the provisions of section 13 (4) of the Pakistan Regulations-the relevant provision of that section may be noted here: "notwithstanding anything contained in any other law, no person shall except with the permission of the state Bank of Pakistan. (a) enter any transfer of securities in any register or book in which securities are registered or inscribed if he has any ground for suspecting that the transfer involves any contravention of the provisions of this section. " It has been submitted that such a permission was in fact refused by the state Bank of Pakistan; as such no entry indicating any transfer by way of assignment could be made in the relevant register kept at Dacca. 49. FROM the series of correspondence, it is seen that a different case was sought to be made out. Before the suit was instituted, the company asserted that the policy records were reunited to be transferred from their Dacca office to their office in India, prior to making arrangements for payment of the policy money to the plaintiff and as the permission of the State Bank of Pakistan, for such transfer, was refused, no arrangement for making payment, could be made. The said fact will appear from the correspondence evidence by the letters Ext. 4, Exts A (cc), A (ee)and Ext. A (mm. But the provision of the law, even if it applies in such a case, does not apply in this case, as the said provision applies to the securities which must have its origin in Pakistan and. not to a foreign security, like the one, under our consideration. There is another stumbling block against the said contention of the appellant. But the provision of the law, even if it applies in such a case, does not apply in this case, as the said provision applies to the securities which must have its origin in Pakistan and. not to a foreign security, like the one, under our consideration. There is another stumbling block against the said contention of the appellant. There is nothing before us that this policy was borne in any of the registers or book in which securities were registered or inscribed. 50. MR. Roy Chowdhury, learned counsel for the appellant has drawn our attention to a register which was produced by the witness Shri Pranab mazumdar examined on be behalf of the defendant. That register was of course, not taken into evidence. It is contended that the learned trial Judge has committed a serious mistake in not admitting the same in evidence, specially when the same has been legally proved by another witness Sri Sailendra nath Chandra. We hove already discussed his evidence, his knowledge, if any, must have extended up to the year 1946 as such in any view he was not at all competent to prove any part of the document after the year 1946 and more so when admittedly he was not at Dacca. There is another infirmity, noticed in the said submission of Mr. Roy Chowdhury, that as the said register was kept in the regular course of business, it ought to have been admitted in evidence. Our attention has been drawn to sections 34 and 35 of the Indian Evidence Act. Normally a matter becomes evidence when Proved by direct evidence, otherwise they are considered as not relevant being hearsay. The above two sections are exceptions to the said rule. In case a particular document satisfies the tests, laid down in section 34 of the Indian Evidence Act, the same becomes relevant. But that by itself, does not make them evidence. Formal proof as required of such documents are required depending of course, on the facts of each case. Firstly, we do not know whether the said register is the part of their account books. In case, it is not a part of such a book the provisions of section 34 of the Indian evidence Act, are not attracted. Moreover, assuming that, it is so, the document becomes relevant, but that by itself does not dispense with its formal proof. In case, it is not a part of such a book the provisions of section 34 of the Indian evidence Act, are not attracted. Moreover, assuming that, it is so, the document becomes relevant, but that by itself does not dispense with its formal proof. Such a point was raised in the case of Hindu Miah v. Heramba chandra Chakravorty reported in 13 c. L. J. 139. Their Lordships (Mukherjee and Sharfuddin JJ.) observed : "section 34 of the Evidence Act. makes the entries relevant if they are entries in a book of account regularly kept in the course of a business. It is therefore not sufficient to prove the correctness of the book the entries themselves have to be proved, unless indeed the necessity for such proof is removed by the admission of the opposite party. " That decision was also followed in the case Bibi Imambandi v. Haji Motasuddi and others reported in 15 C. L. J. 621. Such a question was again raised, though in a different context in the case of Ganeshdas Mimani v. The King reported in I. L. R. (1950) 1 Cal. 462, wherein Harries C. J. and Das Gupta, J. considered the effect of sections 34 and 35 of the Indian Evidence Act and held: "entries in an audit register of the government are relevant by reason of section 34 and 35 of the Indian Evidence Act. But a relevant fact has to be proved like any other fact. The same holds good for entries in books of account made relevant by reason by section 34. But each entry must be properly proved. " 51. TO get rid of this difficulty, it has been contended on behalf of the appellant that under the provisions of the law of Pakistan, such a register as has been produced, requires to be maintained and accordingly the said document becomes relevant under section 35 of the Indian Evidence Act. The said contention is not available to them, in the absence of proof of any such law. For the reasons stated, we hold that the learned Judge, has very rightly refused to accept the said document in evidence. 52. THAT apart, another very important question arises for our consideration. It has been proved that in the head office at Bombay some registers of such policies are maintained. For the reasons stated, we hold that the learned Judge, has very rightly refused to accept the said document in evidence. 52. THAT apart, another very important question arises for our consideration. It has been proved that in the head office at Bombay some registers of such policies are maintained. The reason why such documents have not been produced is not known. The production of such registers would have conclusively shown, whether the registers maintained in the Bombay head office are primary registers of such policies. So non-production of such registers, would justify the court to draw an adverse presumption against the corporation to the effect that had 'hey been produced, they would not have supported their case. Moreover, section 13 (4) (a) of the Foreign Exchange regulation of Pakistan speaks of primary registers maintained in the office in which securities are registered. It has got no reference of those books, in which premiums, if paid are entered for the facilities of keeping an account for the same. Hence, payment of some premiums in the foreign country for the insurance policy, which is governed by the proper law of India, and even if entered in the account book of their branch office, would not alter the position, neither it would make them a security of that country, where premiums for some period were paid. We are thus of the view that the provision of section 13 (4) (a) of the Pakistan Regulation are not attracted in this case. It now comes for our consideration as to the effect of section 4 of the Foreign exchange Regulation of Pakistan. It is said that Brojendra by assignment of the policy in favour of his son has violated the provisions of section 4 of the said Act. The transaction in substance, is said to be an exchange or sale of the foreign exchange. This extended meaning, sought to be attached to the word 'assignment' not contemplated under the law, specially in view of the fact those provisions relate to the penal statute. Any violation of section 4 of the Act, exposes the persons violating the same, to the penalty provided in section 23 of the act. In such a case, the question is simply what is the meaning of the words which the statute has used to describe the prohibited transaction ? Any violation of section 4 of the Act, exposes the persons violating the same, to the penalty provided in section 23 of the act. In such a case, the question is simply what is the meaning of the words which the statute has used to describe the prohibited transaction ? In case those words have a natural meaning, that is their meaning, and such meaning is not to be extended by any reasoning based on the substance of the transaction. Even in case the language of the statute is equivocal and there are two reasonable meanings of that language the interpretation which will avoid the penalty is to be adopted. That is also the principle which has been accepted as a sound one in the English case of Re 4 H. P. C. Production Ltd., reported in (1962) Ch. 466. The present case stands on a more stronger ground inasmuch as there was no bar for making an assignment of a foreign security, even by a resident in favour of a non-resident of Pakistan. In conclusion we are of the view that the transaction of assignment did not violate the provisions of section 4 of the Pakistan Act. 53. OUR attention has been drawn to the draft letter Ext. 5 and its reply ext. 4. The draft letter is stated to have been addressed to the State Bank of Pakistan, sometime in April 1953 by the company, seeking their permission to pay money to the plaintiff on the strength of the deed of assignment. The said permission was refused by the state Bank of Pakistan. It is corroded that the portion of the insurers became precarious as they might have to face double payment, by missing payment in Pakistan exchange rate, in the State Bank of Pakistan. We have discussed the legal aspect involved in such a case. According to us no such permission was necessary. This is a created difficulty, created by the insurers. The company without any reason entered into such a correspondence with the State Bank of Pakistan We are, therefore, of the view that those two documents have no relevancy for the determination of the point at issue. 54. NEXT, it has been contended that the deed, though described as a deed of assignment, in substance it was a pay order. Mr. Roy Chowdhury submits that the said deed Ext. 54. NEXT, it has been contended that the deed, though described as a deed of assignment, in substance it was a pay order. Mr. Roy Chowdhury submits that the said deed Ext. B should be construed as the pay order. In support of his contention reference has been made to the case of Prokash Chandra Kishenlal v. Kays Constructions and another reported in 66 C. W. N. 483 where it has been held by Bachawat and d. N. Das Gupta, J J. that: "a pay order should be distinguished from an assignment. A pay order gives the payee no Internet in the fund and the liability of the debtor is still to the creditor and not to the payee. But en instrument, though in form, a pay order, may amount to an assignment and may pass the interest in the fund to the payee. Each instrument must be construed in the light of its own language and in the 1ight of the attendant circumstances. " That decision lays down the principle that a pay order under certain circumstances may be considered as a deed of assignment But the reverse cannot be true and it cannot be said that all deeds of assignment are pay orders. Contrary argument does not get any support from that decision. More ever, when assignment is effected under the permissible term of the contract having its sanctity under the law, no Question of 'pay order' arises. Another attempt has been made to show that a deed of assignment can be treated as null and void under certain circumstances. In support of that contention reference has been made to the case of Mitholal Nayak v. Life Insurance Corporation of India reported in A. I. R. 1962 S. C. 814. That is a case where the policy itself was found to have been procured by fraud and that the same continued till it ended in the execution of the deed of assignment. In the background of that case the same has got no application in the facts of the instant case. We may also consider another decision which has been placed before us in this connection. That is a decision of the Madras High Court in the case of D. Mohanavelu Mudaliar end another v. Indian Insurance and banking Corporation Ltd. and another. reported in A. I R. 1957 Madras 115. We may also consider another decision which has been placed before us in this connection. That is a decision of the Madras High Court in the case of D. Mohanavelu Mudaliar end another v. Indian Insurance and banking Corporation Ltd. and another. reported in A. I R. 1957 Madras 115. From the said decision it was sought to be argued that a policy when assigned, completely divests the assignor of any right under it, for the essence of assignment is complete divesting. The assignee is, therefore, clothed with all the rights and liabilities which the insured occupied before the transfer i. e. there is a substitution for the assured so far as the benefits are concerned by the assignee. From the above it is said that the assignee should get the benefit under the policy subject to particular liabilities and equities to which the assignor was subject at the time of assignment; as Brojendra the assignor being a resident in Pakistan could not transfer the said policy without the sanction of the State Bank of Pakistan, the deed under the law was unenforceable and as such Rabindra could not get benefit out of the same unless and until he gets permission of the state Bank of Pakistan. The said argument is not tenable as we have decided that no such permission is ridded in case of assignment of such policy which was a foreign security of Pakistan vis-a-vis India. 55. THE next point urged on behalf of the appellant is though short, by no means easy. That relates to the question, upon the meaning and effect of certain provisions of Foreign Exchange regulation of India. Under section 5 of the said Act certain restrictions have been laid on payments, part of the said provisions which is relevant for our consideration is as follows : section 5 (1) : save as may be provided in and in accordance with any general or special exemption from the provisions of this sub-section which may be granted conditionally or unconditionally by the reserve Bank no person in or resident in India shall- (a) make any payment to or for the credit of any person resident outside india; (b) make any payment to or for the credit of any person by order or on behalf of any person resident outside india, 56. THE relevant portion of that section has only been mentioned. THE relevant portion of that section has only been mentioned. It has been argued that as the position stands, if the prayer of the plaintiff be granted, L. I. C. i. e. the appellant will have to make payment to Rabindra the plaintiff and that will be a payment in violation of the provisions of the regulation noted above, as it will be a payment in fact to Brojendra a resident outside India. Firstly, it has been argued that the payment in violation of the provisions noted above would clearly be illegal and accordingly, the said transaction would be void; that being the position, the same cannot be enforced in law. The said argument is sought to be repelled by Mr. Ghosh, learned counsel for the respondent who asserts that the said question does not arise in the fact of this case; the assignment by brojendra in favour of Rabindra, being legal there is no bar to enforce the payment on the strength of the said deed of assignment which created an independent right for Rabindra to get the money covered by the policy. In such a case it will be a payment by l. I. C. a resident of India to Rabindra another resident of India. So, such payment will not hit the provisions of the regulation referred to above even if the said payment to Rabindra be considered to payment on behalf of brojendra, a resident outside India the said transaction cannot be said to be void one. Such point was raised in the case of Contract and Trading Co. (Southern) Ltd. And Barbey and otters reported in (1960) A. C. 245. Viscount Simonds while delivering his speech observed that such a provision in the English Regulation should not be used to enable the defendant to retain the money in his, pocket but to control its reaching its destination, namely, the plaintiff. Similar are the provisions ruled in the English Regulation Controlling the Foreign Exchange. The question arose therein whether infringement of certain provisions of section 5 of a similar regulation would make the contract void. His Lordship was of the view that the said contract cannot be said to be void as the defect, if any, could be removed by the sanction of the proper authorities. Similar is also the provision in our Act. The question arose therein whether infringement of certain provisions of section 5 of a similar regulation would make the contract void. His Lordship was of the view that the said contract cannot be said to be void as the defect, if any, could be removed by the sanction of the proper authorities. Similar is also the provision in our Act. Any infringement in the provisions of section 5 of the regulation can be cured if and when a decree is passed under the provisions of sub-section (2) and (3) of section 21 of the said Act. The effect of those provisions is to prevent persons against performance of their contract by setting up the shield of illegality. The cumulative effect of these provisions is that there is no bar in the plaintiff's getting a decree but the implied term of the said contract is that it is his responsibility of obtaining the permission of the reserve Bank of India before enforcing the judgment and decree or the order of the Court. When the said right is guaranteed to such a person, the contention of the appellant that the claim of the plaintiff is based on a contrite which is void and as such unenforceable, has got no substance. We are fortified with a decision of the Supreme court in this regard. Their Lordships in the case of Dhanrajmal Gobindram v. Shamji Kalidas and Co. reported in a. I. R. 1961 S. C. 1285, held that the effect of provisions of section 21 is that the Foreign Exchange Regulation Act arms person against performance of their contracts by setting up the should of illegality. An unpaid term is engrafted upon the contract of parties by the second part of sub-section (2) and by sub-section (3) the responsibility of obtaining the permission of Reserve bank before enforcing the judgment and decree or order of court, is transferred to the decree-holder. That is the complete answer to the problem which has been raised by Mr. Roy chowdhury in this regard. 57. THE purpose for which the foreign Exchange Regulation Act 1947 of India was passed, was to protect the economy of this country. If a decree is passed in the instant case we fail to understand how the purpose and object of the said Act can be frustrated. Roy chowdhury in this regard. 57. THE purpose for which the foreign Exchange Regulation Act 1947 of India was passed, was to protect the economy of this country. If a decree is passed in the instant case we fail to understand how the purpose and object of the said Act can be frustrated. While enforcing the provisions of the Act one should be cautious to see that the provisions of the Act be not interpreted in such a way as to make the same an instrument of oppression or discrimination. Accordingly, considering the pros and cons of the case regarding the point at issue, we hold that the transaction in question cannot be said to be void one and as such it cannot be said to be unenforceable in the court of law. 58. SECONDLY, it has been contended that the object of creating the deed of assignment was to circumvent the provision of the law both of Pakistan and of India; accordingly, the said deed should be struck down as illegal and in consequence thereof is unenforceable in the court of law. It is difficult for us to subscribe to that view for the reasons that no part of the said transaction has affected the provisions of the Foreign exchange Regulation of both the countries. It is the desire of Brojendra, the father, to provide for his son and he did the same in accordance with law. The question of malafide intention on the part of Brojendra, therefore, does not arise. So, the said contention of mr. Roy Chowdhury also fans. In this connection before we close the discussion about the point, which has been raised on behalf of the appellant we would like to mention a few other facts. it was contended that section 21 of the Foreign Exchange regulation of India has got no application in the instant case as the permission sought for to make payment has already been refused our attention has been drawn to Exts. 10 and 11. Those documents do not support the said contention in any way. Thus suit was instituted in the year 1955. Ext. 11 is a letter dated 28th January, 1957 written from the office of L. I. C. at bombay, to the Assistant Controller, reserve Bank or India. 10 and 11. Those documents do not support the said contention in any way. Thus suit was instituted in the year 1955. Ext. 11 is a letter dated 28th January, 1957 written from the office of L. I. C. at bombay, to the Assistant Controller, reserve Bank or India. The object of the said letter was to get the general permission of the Reserve Bank of India for making payment on clams loans, surrender values, etc to the Corporations policy holders permanently residing in Malaya, Burma, Ceylon. B. E. Africa, U. K., Pakistan and other countries where the corporation bank accounts. That was the facility to be extended to the policy holders in receiving the payment where they were living. To that letter the Reserve Bank of India replied on 7th March, 1957 giving permission to the payment on maturity death claims, loans and surrender values on the policy issued by the company to the policy holders permanently resident outside India from the foreign currency account maintained by the Corporation in the respective countries subject to certain conditions. It is therefore, seen that those two letters could not have any reference to the transaction in question as the cause of action arose in the year 1952 and the suit for realisation of money under the said transaction was filed in the year 1955. Our attention has also been drawn to certain portion of the evidence of Mr. Ranadive, wherein he frankly admitted that no permission for making payment with regard to the policy in question was ever sough; for from the Reserve Bank of India. That will appear from the answer which he gave to question Nos. 373 to 376, 388 and 591. The above facts clearly negative the contention of the appellant that the for payment of the policy money in India from the Reserve Bank was sought for and was refused. Before we cross this chapter, we may once again refer to section 21 of the Indian regnant on Act 1947 with a view to ensuring compliance with the provisions or the Act which provides that no person shall evade or avoid in any way the operation of any provisions, of the Act. But that is not an absolute embargo imputed on such a transaction and no civil action is forbidden. But that is not an absolute embargo imputed on such a transaction and no civil action is forbidden. The said embargo may be lifted in case a decree holder gets necessary permission of the Central government or the Reserve Bank, to the benefit of the judgment or decree as laid down in sub-section 3 of that section. However, we need not enter into further discussion on this matter as we have held that the parties concerned have not violated any of the provisions of that Act. We have almost come to an and of our discussion of the points connected in this case. All the points cased in this appeal by the appellant lose much of its force, if Brojendra be found to be a resident in India at the relevant time. This question arises for consideration in respect of issue No. 11 as framed by the Lamed Judge. The said issue has also been decided against the appellant as the learned Judge held that Brojendra was not a resident in pakistan but in India at the relevant date when the deed of assignment was executed. The said finding in stands, the appellant is out or court all at once, as other objections raised in this connection are not available to them That shows the importance of the said issue. 59. MR. Ghosh has submitted that the finding of the learned Judge, is based on faces which should not be disturbed. Mr. Roy Chowdhury, on the other hand, has seriously challenged that finding. In case, the contention of mr. Ghosh be accepted then the points already decided, do not bacons relevant. If the transaction in question be held to have taken place between two residents of India, it cannot offend any of the relevant provisions of the Indian exchange regulation. The contentions of the respective parties lead us to the difficult question as to the real meaning of the words 'resident in' as used in the foreign Exchange Regulation Act 1947. 60. ON behalf of the appellant, our attention has been drawn to Ext. 8, a letter dated 19th January, 1953 written by Brojendra to the Manager of the company. In that letter he stated hat he was a permanent of Pakistan. Reference may be made to the entire letter which runs thus : "i am to state that I am a permanent resident of Pakistan. 8, a letter dated 19th January, 1953 written by Brojendra to the Manager of the company. In that letter he stated hat he was a permanent of Pakistan. Reference may be made to the entire letter which runs thus : "i am to state that I am a permanent resident of Pakistan. The above mentioned policy has been duly assigned by me as already informed to any son sri Robindra Mohan Mitra who Indian resident and lives at Calcutta for valuable consideration. " This letter, however, shows that brojendra decided to be a permanent resident of Pakistan. Admittedly Brojendra had properties both in Pakistan and in India. The company was insisting to know whether he was a permanent resident of India or of Pakistan. In course of that correspondence Brojendra informed the Manager of the company by a letter dated 20th October, 1952 that he generally stayed in india for major portion of the year. It has also been established that his wife and son have been residing in India. He desperately needed the money to meet medical expenses of his wife who was confined in Calcutta. After the execution of the deed of assignment in favour of the plaintiff on the 18th December, 1952, Brojendra decided to be a permanent resident of Pakistan. It has been argued that Brojendra's conduct was unclean in that respect, he being a resident of Pakistan executed the deed of assignment when he was in calcutta only to avoid the rigors of the law of Pakistan. It has already been stated that Brojendra had property both in India and in Pakistan and while the Evacuee Properties Act was staring at his face, he had to make proper arrangement to safeguard his interest in the properties both in India and in pakistan. In this background if after the execution of the deed of assignment, he finally decided to be a permanent resident of Pakistan to protect his property there, no adverse inference against his conduct ran be drawn. Be that as it may, evidence before us is that he was residing in Calcutta for major part of the year. All correspondences which passed between the company and brojendra were passed in his Calcutta address, not a letter or any document could be produced by the company or l. I. C. to show that Brojendra was a permanent resident of Pakistan. All correspondences which passed between the company and brojendra were passed in his Calcutta address, not a letter or any document could be produced by the company or l. I. C. to show that Brojendra was a permanent resident of Pakistan. In this connection, it may be mentioned that the word 'permanent' is an innovation made by the company which is not to be found in any part of the regulation. 'resident in' has got to be considered in its true meaning. It simply means a person residing in India. This question arose at different times for consideration of the courts as to the proper meaning to be attached to it. Mr. Roy Chowdhury has drawn our attention to sub-section 3 of section. 2 of the Exchange Control Manual (4th edn.) and has contended that 'resident in India' should be construed as meaning a permanent resident in India. In support of the said contention that sub-section 3 has been placed before as. According to Mr. Roy Chowdhury the said section being framed under a statutory provision made under subsection 3 of section 20 of the Foreign exchange Regulation has got the binding force on the court. True it is, that the manual has been framed under that provision. But it has got to be seem whether the said section has got the binding effect on the court. The manual will show that certain sections hare been framed in order to give proper directions and instructions to the dealers in foreign exchange. It is, therefore, nothing but the guideline and the instruction meant to be followed by the persons authorized to deal with foreign exchange and to administer the same. Barring that it has got no other binding force or effect on any court of law. In appendix, the foreign exchange regulation has been appended. All notifications, which have been issued from time to time have also been appended in the said manual in the appendix. Be that as it may, the said sub-section 3 it self shows that the problem as to find out the real meaning regarding 'resident in India' is a very difficult one. As the manual itself lays down that the precise rule cannot be laid down for determining whether a person is a resident or not, it is, therefore, seen that the question has got to be considered on the materials connected in that case. As the manual itself lays down that the precise rule cannot be laid down for determining whether a person is a resident or not, it is, therefore, seen that the question has got to be considered on the materials connected in that case. The manual itself provides for such a contingency wherein it has been laid down that in a case where it is difficult to find out as to the real status of a person, the residence status should be determined by taking into consideration, the various facts, such, as the place the person is habitually resident, the place where he maintains a home, the place where his family habitually resides. Mr. Roy Chowdhury has drawn our attention to the following facts from which we have been asked to draw an inference that Brojendra must be a permanent resident in Pakistan. Firstly, it is said that all the letters written by him to the company at Bombay show his address as Co. his son Rabindra in calcutta. That itself indicates that he was not a permanent resident in Calcutta. Next it has been contended that some premiums have been paid in Pakistan. Mr. Ghosh on the other hand has submitted that a person while in foreign country may also make payment to wards the premium of a policy. Moreover, a person residing in India and particularly after partition of India having some properties in Pakistan, may find difficult to bring money due to prohibition of sending money from one country to another under the provisions of the foreign exchange regulation of the respective countries. It is an abnormal situation which was created after partition of India. That fact itself shows that Brojendra might have faced certain difficulties in bringing money from Rajshahi to Calcutta. He, in his letter to the company made certain statement pointing out such difficulties that by itself does not show that he was a permanent resident of Rajshahi. It has further been submitted that the address giving Co, should not be construed to mean hat a person must have been living out of India and as such the said term was used. From the record, it has been established beyond doubt that the wife Brojendra and his son have been living in Calcutta and that Brojendra for the major part of the year bad been living there. From the record, it has been established beyond doubt that the wife Brojendra and his son have been living in Calcutta and that Brojendra for the major part of the year bad been living there. In this context let us examine the relevant provisions of law. Mr. Roy Chowdhury's contention that onus, to prove that Brojendra was a resident in India lies heavily on the plaintiff in the absence of any evidence of Brojendra the said onus cannot he said to have been discharged. In this connection reference has been made to the case of s. P. Ghosh v. Deputy Controller, Reserve Bank of India reported in A. I. R. 1964, Calcutta 422 In that case D. N. Sinha. J. (as he then was) considered the question of domical. The question of domical is different from the question of residence. Domical may be do domical of origin or domical of choice. It has been laid down in that case that case than the onus of that a domical has been chosen in substitution for the domical of again is upon him who assents it in the instant case we are not concerned with any question of domical but of domical but quite a different question. The term 'resident term 'resident in' has got a different meaning altogether. We may now refer to a decision in the case of Bhaguan Cocuka v. Union india. repotted in A. I. R. 1961. Madras 47. Wherein while dealing with the provisions of section 9 of the Regulation. the interpretation of the words "every person in or resident in the states'' came for consideration of the court. It was sought to be said therein that if a person though of India goes out of India and enters into certain transaction prohibited under section 9 of the said regulation. He cannot be said to have committed any offence. In that connection the following is the observation of their lordships. "we have carefully considered his interpretation and we are quite unable to sustain it. On the contrary, the distinction between 'in' and 'resident in' clearly implies that what is intended is a 'description of quality, namely, of ordinarily continuous residence, and that a purely temporary stay abroad will not makes the section less applicable. '' hence, it is seen that their Lordships were thinking about the qualitative test as to the residence of a particular person. '' hence, it is seen that their Lordships were thinking about the qualitative test as to the residence of a particular person. It, therefore, comes in the domain of a decision to be made on the facts and circumstances connected with each individual case. We are conscious that the provisions of section 5 of the Regulation cannot be attracted to a person who might have come to india on a sojourn. A person cannot be called a resident of India while he comes to India absolutely on a temporary basis, such as sight seeing or transit while passing from one country to another. Something more is needed to satisfy the qualitative test in this regard. It has amply been established in evidence that Brojendra lived in calcutta during the major part of the year. His family had also been living with him there. All the correspondences passed between the company and him while he was in Calcutta. The cumulative effect of all these facts will go to show that Brojendra can be said to be a resident of India at the relevant time. Let us now come to the question of onus. In this connection sub-section 1 of section 20 of the Indian regulation which is to the following effect may be referred to : "for the purposes of this Act and of any rules, directions or orders mad there under- (a) Until the Reserve Bark by general or special order otherwise directs any person who has at any time after the commencement of this Act been resident in India shall be treated as still being resident in India and if such direction is given in relation to any such person the Reserve Bank may by the same or by a subsequent direction, declare the territory in which he shall be treated as being resident; let us see when this Act commenced. This Act came into force on the 25th March 1947 under notification No. F12 (10) /fi/ 47 dated 19th March 1947 and applied to "undivided India'' as it then was (vide p. 90 of Vakil's book on the law relating to Foreign Exchange in India, (4th Edition) Sub-section 1 of section 20 read with the above mentioned notification published under sub-section 3 of section 1 of the said regulation clearly shows that a person residing in undivided India at the time of the said notification will be presumed to be a resident in India unless otherwise directed by the Reserve bank. The difficulty has been coated in this case by the company by assuming Brojendra to be a resident of Pakistan overlooking the provisions of law in respect thereof. " Therefore, the law as it stood gives Brojendra a status of ''resident, in India'' and unless it is otherwise directed by the Reserve Bank of India he must have continued to be. so. Therefore the question of onus, if at all arises has heavily on the appellant to show that Brojendra ceased to be a resident of India and became a resident of Pakistan. The materials on record point out that Brojendra was a resident in India according to the meaning attached to it at the relevant time. In this view of the matter Brojendra, a resident in India executed the deed of assignment in favour of Rabindra who was also a resident of India. Thus when the transaction was between the two persons residing in India. the same cannot be said to have violated any provisions of the law. This point, therefore, determines the entire question. We may also note here that the discussion made above would show that at the relevant time Brojendra was not a person resident in Pakistan. Accordingly, there is no has under any of the provisions of the Pakistan Regulation affecting the transaction in question. We may further rote here that Ext. 5 which which clearly shows that Mr. Ranadive a responsible officer of the company treated. Brojendra as a non-resident of pakistan at the relevant time. In the draft letter Ext. 5 sought to be addressed to the State Bank of Pakistan, the following statement was made. We may further rote here that Ext. 5 which which clearly shows that Mr. Ranadive a responsible officer of the company treated. Brojendra as a non-resident of pakistan at the relevant time. In the draft letter Ext. 5 sought to be addressed to the State Bank of Pakistan, the following statement was made. ''in view of the fact that the assignment has been effected by the assured while he was a non-resident of Pakistan and that the assignment is in favour of another non-resident not in a different county but in favour of a person who was a resident in the same country as the assignor, we "presume, your approval is not necessary. " with reference to this letter Mr. Ranadive candidly admitted that the said statement was the true statement and that he took the entire responsibility for making such a statement and that the same was not a false one which might be said to have been made with the intention of deceiving the State bank of Pakistan. Considering all these aspects of this case we are convinced that the transaction being between two persons residents in India cannot be challenged to be illegal on any score as has been sought to be done on behalf of the appellant, which depends upon the interpretation of the words "resident in" in respect of different section of the Regulation both of India and of pakistan. On behalf of the appellant it has been submitted that resident of a country means permanent resident of that country. A temporary sojourn will not make a person a resident of that country. This view is supported in a decision of the case Shanti Prasad Jain v. The Director of Enforcement, reported in A. I. R. 1962 S. C. 1764. That was a case in which some transactions of mr. Jain was considered while he had been to Germany on a temporary sojourn. The transaction so made, was struck down on the ground that it was in violation of the provisions of section 4 and other relevant sections of the foreign Exchange Regulation of India. In that connection the question arose whether a person, though a citizen of india while in a foreign country can enter into certain transaction by asserting that he was not a resident of India but outside India at the relevant time. In that connection the question arose whether a person, though a citizen of india while in a foreign country can enter into certain transaction by asserting that he was not a resident of India but outside India at the relevant time. The said contention was negative on the ground that the expression 'resident in India' was clearly used in the sense 'resident of India'. The ratio decided of that decisions cannot be extended to the facts of this case. We have discussed this matter in detail and we have come to the conclusion that the presence of Brojendra in India was not on a transitional visit or a sojourn for a few days or for a shorter period which cannot be covered under the term 'resident in India'. Though it is difficult to formulate any principle to give a firm meaning to the words 'resident in' without any definition in the Act, each case has got to be decided on the facts involved in it. No hard and fast rule can be laid down. The legislation itself has kept the meaning undefined to be decided by the court or the authorities if and when occasion arises. In this view of the matter as we have come to the conclusion that Brojendra was a resident in India at the time when the deed of assignment was executed in favour of Rabindra and as the transaction was between two persons being residents in India we do not find anything wrong in the same. We are, therefore, of the view that there is no bar in enforcing the said deed of assignment and in passing a decree on that basis as prayed for by the plaintiff in this case. 61. AS all the points raised by the appellant have been negative, we are of the view that the full complex of the substantive law of India must be applied in this case. For the reasons stated we agree with the findings of the trial court. The judgment and decree are hereby affirmed. In the result, the appeal is dismissed with costs. Certified for two counsel. 62. A prayer has been made by the learned counsel for the appellant for staying the operation of this judgment for some period to give his client an opportunity to file an application for leave to prefer an appeal to the Supreme Court if so advised. In the result, the appeal is dismissed with costs. Certified for two counsel. 62. A prayer has been made by the learned counsel for the appellant for staying the operation of this judgment for some period to give his client an opportunity to file an application for leave to prefer an appeal to the Supreme Court if so advised. Let the operation of this order be stayed for one week after the ensuing long vacation. Learned counsel for the respondent submits that the respondent should be released from the security which has been furnished by him at the time of withdrawing the money deposited by the appellant. The said prayer will be considered if and when an application is filed. Appeal dismissed.