Manohar Lal v. Panchayat Samiti, Nohar — 1981 DIGILAW 345 (RAJ)

S.K. MAL LODHA, J.— The plaintiff-appellant has filed this appeal under O. XLIII r.l C.P.C. against the order dated July 26, 1971 passed by Additional District Judge No, 1, Jodhpur in Civil Original Suit No. 42 of 1968 directing the return of the plaint under O. VII r.10 C.P.C. 2. The relevant facts necessary for the disposal of the appeal are these: 3. The plaintff appellant instituted a suit against the defendant respondent Panchayat Samiti, Nohar for Rs. 21,300/-in the Court of Senior Civil Judge No.l, Jodhpur. A tender notice (Ex.3) dated July 6,1966 was published in "Rastradoot" dated July 11,1966 and two other local news papers "Sima Sandesh" and Senani" by Panchayat Samiti, Nohar. The prospective tenders were asked by the tender notice to obtain the list of articles from the Office of the Panchayat Samiti, Nohar. The last date for receiving tenders was July 25, 1966. The defendant had also sent a letter to Manoharlal & Company, of which, Manoharlal is the proprietor. Alongwith the letter dated July 18,1966, a copy of the tender notice dated July 6, 1966 containing the terms and conditions on which the prospective tenderers were required to submit their tenders for the wanted articles was also sent. Out of the conditions mentioned therein, conditions No. 1,4 and 5 may be reproduced: "1. Tenderers should specifically mention the rate of taxes etc; and should clearly disclose as to whether the supply of goods will be F.O.R. Nohar Railway Station or Godown; 2. In no case R/R or T/R will be accepted through Bank or V.P.P The payment will be made only after complete supply is made; and 3 Successful tenders shall have to supply goods ordered within a period of one month from the date of the receipt of the order". The plaintiff submitted tender quoting the rates of various articles for which the tenders were invited. It was sent by the plaintiff through registered post from Jodhpur. The tenders were opened on July 25,1966 by the defendant. As the rates quoted by the plaintiff for the following articles were lowest, the tender of the plaintiff with regard to those articles was accepted by the defendant: (1) Folding Chairs (Godrej type), (2) Folding tables, (3) Iron buckefs, (4) Iron almirahs, (5) Darri Patties. The defendant vide its letter (Ex.4) No. 3563/Acctts. As the rates quoted by the plaintiff for the following articles were lowest, the tender of the plaintiff with regard to those articles was accepted by the defendant: (1) Folding Chairs (Godrej type), (2) Folding tables, (3) Iron buckefs, (4) Iron almirahs, (5) Darri Patties. The defendant vide its letter (Ex.4) No. 3563/Acctts. dated July 30,1966 communicated the acceptance of the tender of the plaintiff in respect of the above mentioned articles from Nohar. It was received by the plaintiff at Jodhpur. The material portion of the letter (Ex.4) dated July 30, 1966 may usefully be quoted: "Your tender quotations having been found lowest with regard to the following articles, the same has been accepted by me and you are hereby ordered to supply following articles- the quantity of which is noted against each of the rates and on the terms noted in your tender quotations:- "Note: (iv) All the items should be supplied immediately." The plaintiff supplied the articles on various dates. Some dispute arose between the plaintiff and the defendant. The defendant made payment to the plaintiff for iron buckets but no payment for folding chairs and tables were made by the defendant to the plaintiff. Thereafter, the plaintiff served a notice under s.75 of the Rajasthan Panchayat Samities and Zila Parishads Act, 1959. After the expiry of the statutory period of limitation of the notice, the plaintiff instituted a suit as aforesaid. It was contested by the defendant on various grounds. Amended written statement was filed on September 3,1969. One of the pleas with which I am concerned in this appeal is that the Court has no jurisdiction to try and determine the suit. Issues were framed by the trial Court on March 26,1970. Issue No.7 when translated into English reads as under: 4. "Whether this Court is competent to hear the suit?" In connection with issues No 1 and 7, the statements of P.W.1 Manoharlal and DW.l Moh-ansingh were recorded. The learned Additional District Judge by his order dated July 26, 1971 held that the Court has no jurisdiction to entertain the suit. He therefore, decided issue No.7 against the plaintiff, and in favour of the defendant. He ordered that the plaint should be returned to the plaintiff under O. VII r.10 C.P.C. for presentation to the Court, in which, the suit should have been instituted. He therefore, decided issue No.7 against the plaintiff, and in favour of the defendant. He ordered that the plaint should be returned to the plaintiff under O. VII r.10 C.P.C. for presentation to the Court, in which, the suit should have been instituted. The plaintiff was also directed under s.35 C.P.C. to pay Rs. 100/- as costs to the defendant of this suit. Feeling aggrieved, the plaintiff has filed this appeal as aforesaid. 5. Summons of the appeal was served on the defendant-respondent on January 20, 1972. Nobody has appeared on behalf of the respondent despite service of summons. I have heard Mr. D.S. Shishodia, learned counsel for the appellant in support of the appeal and have also gone through the relevant record of the case carefully. 6 Mr. D.S. Shishodia, learned counsel for the appellant has challenged the finding on Issue No.7 to the effect that the Court at Jodhpur has no jurisdiction to try the suit as erroneous on three grounds ;(i) that the letter (Ex.4) dated July 30, 1966 communicating the acceptance was a counter offer, which was accepted by the plaintiff at Jodhpur and hence, the Court at Jodhpur has jurisdiction to try the case; (ii) that as the part of the cause of action arose at Jodhpur inasmuch as the goods were despatched from Jodhpur and the plaintiff sent R.R. to the defendant from Jodhpur and, therefore, the delivery being to the common carrier must be deemed to be the delivery to the buyer (defendant) and as such part of cause of act on arose at Jodhpur; and (iii) that from the letter dated October 24,1966. which was sent by the Vikas Adhikari, Panchayat Samiti, Nohar to the plaintiff, about which, there is no dispute between the parties, it is clear that the goods supplied by the plaintiff were rejected by the defendant and that on that count, payment was refused. The communication of rejection of goods and refusal to) pay are part of cause of action and as that was communicated to the plaintiff at Jodhpur, the part of cause of action arose at Jodhpur and, therefore, the Court at Jodhpur has jurisdiction to try the suit. Mr. The communication of rejection of goods and refusal to) pay are part of cause of action and as that was communicated to the plaintiff at Jodhpur, the part of cause of action arose at Jodhpur and, therefore, the Court at Jodhpur has jurisdiction to try the suit. Mr. Shi-shodia, learned counsel for the appellant submitted that for the purpose of determining the question of jurisdiction it is not necessary to confine to the averments made in the paras of the plaint relating to cause of action and jurisdiction, but all the averments made in the plaint necessary for the proper adjudication of the dispute between the parties should be carefully looked into and analysed. I have carefully considered the submissions made by the learned counsel for the appellant. 7. Before I proceed to examine the correctness of the finding of the learned Additional District Judge, let me take note of the relevant averments made in the plaint having bearing on the question of jurisdiction. In para 6 of the plaint, the plaintiff has stated that the letter (Ex.4) dated July 30, 1966 by which the acceptance of the tender was communicated was a counter offer, which was sent by post to the plaintiff and it was received at Jodhpur. In para 13 of the plaint, reference of letter No. 5642 dated October 24,1966 has been made and the facts stated therein have been disputed. In para 16 of the plaint, the plaintiff has stated that the Court at Jodhpur where the suit has been instituted has jurisdiction to hear it, for, the letter (Ex.4) dated July 30, 1966 was a counter offer, which was accepted by the plaintiff at Jodhpur and that the entire goods were delivered to the Railway at Jodhpur and that the Railway Receipts were endorsed in favour of the defendant by the plaintiff at Jodhpur. According to the plaintiff, the cause of action arose at Jodhpur when he received the letter (Ex.4) dated July 30, 1966 which was a counter offer and when the folding chairs and tables were delivered to the Railway at Jodhpur. In reply to paras 16 and 18 of the plaint, the defendant has stated that the offer made by the plaintiff was accepted by the defendant at Nohar and, therefore, a binding contract came into existence at Nohar. In reply to paras 16 and 18 of the plaint, the defendant has stated that the offer made by the plaintiff was accepted by the defendant at Nohar and, therefore, a binding contract came into existence at Nohar. It was further pleaded that the goods were to be delivered at Nohar and the contract was to be performed at Nohar and, therefore, no part of cause of action arose at Jodhpur. In these circumstances, it was contended that the Court at Jodhpur has no jurisdiction to hear the suit. 8. The firs and formest question that arises is whether by acceptance of the tender by means of the letter (Ex.4) dated July 30,1966, a complete and binding contract came into existence or the aforesaid letter (Ex 4), as there was a variation of the term regarding the period of the delivery of the goods, was merely a counter offer sent to the plaintiff by the defendant which was accepted by the fromer at Jodhpur and so, the binding contract after acceptance of the counter offer come into existence at Jodhpur and, therefore, the Court at Jodhpur has jurisdiction to hear the suit. A perusul of the letter (Ex.4) shows that the tender quotations were accepted and the plaintiff was ordered to supply the articles mentioned therein, the quantity of which was noted against each, at the rates and on the terms noted in the tender quotations. Below that, there are "Note" and Note No. (iv) is that "all the items should be supplied immediately," whereas in the tender notice (Ex.3) clause 5 is that "successful tenderers shall have to supply goods ordered within a period of one month from the date of the receipt of the order." In these circumstances, the question is whether there was any variation between clause 5 of the tender notice (Ex.3) and Note (iv) of the letter (Ex. 4). 9. S.55 of the Indian Contract Act deals with time for performance of the contract and provides for (i) Effect of failure to perform at fixed time, in contract in which time is essential; (it) Effect of such failure when time is not essential; and (iii) Effect of acceptance of performance at time other than that agreed upon. 10. 4). 9. S.55 of the Indian Contract Act deals with time for performance of the contract and provides for (i) Effect of failure to perform at fixed time, in contract in which time is essential; (it) Effect of such failure when time is not essential; and (iii) Effect of acceptance of performance at time other than that agreed upon. 10. Their Lordships of the Supreme Court in K. Sriramulu vs. Aswatha Naravana (1) have observed: "The mere omission to settle the mode of payment does not effect the completeness of the contract like the price and area of the land and the time for completion of the sale were all fixed." It is, therefore, clear that time of performance is a vital and material term of the contract. 11. The material portion of S. 7 of the Indian Contract Act is as under : "7. In order to convert a proposal into a promise the acceptance must- (1) be absolute and unqualified; (2)..............." The rule of sub section (1) of S 7 is that the words of acceptance which do not correspond to the proposal actually made are not really an acceptance of anything and therefore, can amount to nothing more than a new proposal, or, as it frequently called, a counter offer. The question in the case is whether by letter (Ex.4), there is a real and absolute acceptance of the proposal or introduction of Note (iv) is a condition or qualification which makes it only a stage in a course of negotiation capable of leading, but not necessarily leading to a concluded contract. It has been stated in Cheshire and Fifoots Law of Contract, Ninth Edition, as under: "Whatever the difficulties, and however elastic their rules, the judges must, either upon oral evidence or by the construction of documents, find some act from which they can infer the offerees intention to accept, or they must refuse to admit the existence of an agreement. This intention, moreover, must be conclusive. It must not treat the negotiations between the parties as still open to the process of bargaining. The offeree must unreservedly assent to the exact terms proposed by the offeror. If while purporting to accept the offer as a whole, he introduces a new term which the offeror has not had the chance of examining, he is in fact merely making a counter-offer. The offeree must unreservedly assent to the exact terms proposed by the offeror. If while purporting to accept the offer as a whole, he introduces a new term which the offeror has not had the chance of examining, he is in fact merely making a counter-offer. The effect of this in the eyes of law is to destroy the original offer." (Italic supplied) Chitty on Contracts, Twenty Fourth Edition has stated in para 55 as follows: "A counter-offer by the offeree not only fails as an acceptance. It also generally amounts to a rejection of the original offer, which, therefore, cannot subsequently be accepted. (1840) 3 Baav.-334 (Hyde V. Wrench)." In Sanjiva Rows Indian Contract Act, 6th Edition, Volume-1 at page 361, it is stated as under: "An acceptance which attempts to change the place of payment is invalid, as where the offer implies a payment to the vendor at his residence and at the acceptance fixes the place of payment at the residence of vendee, or at designated bank, or where the land is situated, or an acceptance which attempts to change the time and place of the delivery of a deed or where the vendee by acceptance attempts to change the delivery of the deed to a delivery in esc mow to a person designated by vendee, to whom he offers to pay the purchase money an acceptance changing the time and terms of payment, or the time for which the contract is to run, or the time of performance, does not constitute a contract If the offer of sale does not state the terms of payment case payment is implied. Hence an acceptance which attempts to secure even a short period of credit does not make a contract such as an acceptance which provides, "will * * * * settle promptly." (Itelick supplied) It, therefore, follows that the acceptance which attempts to change the time of performance does not constitute the contract. 12. In Benarasi Debi vs. New India Assurance Co. 12. In Benarasi Debi vs. New India Assurance Co. (2), while examining section 7 of the Contract Act, Ahmad, J. with whom K. Dayal, J. agreed observed as follows : "An acceptance by an insurance company of a proposal for life insurance on condition that the first premium thereunder should be paid within 30 days from the date of that acceptance is in law a counter offer to be completed thereafter into contract by the fulfilment of that condition as required thereunder." In that case, the insurance policy was an endowment policy and the proposal form for that policy had been signed on April 20, 1947 and it was thereafter finally accepted on May 14, 1947 though on condition that the first premium thereunder should be paid within 30 days from the date of that acceptance. Unfortunately, the first premium was not paid within 30 days from the date of the aforesaid acceptance namely, May 14, 1947 with the result that the counter offer as stated stood automatically withdrawn. In those facts, it was further observed as under: "It is well established that such a conditional acceptance is in law a counter offer to be completed thereafter into contract by the fulfilment of that condition as required thereunder." A learned single Judge of the Calcutta High Court in M. Govindam vs. Gulabchand Rawatmuli (3) held that a conditional acceptance is not recognised by law, and that in order to convert an offer into a contract, the acceptance must be absolute and unqualified. He observed as follows: "If a counter proposal is accepted by the party which made the original proposal, necessarily the original proposal is superseded by the counter-proposal. If the counter proposal is rejected by the party which made the original proposal, then also the original proposal cannot be deemed to be automatically revived. But, if the counter-proposal be withdrawn before it has been either accepted or rejected, it must be held that the original proposal stands unrejected, and the acceptance will be good provided it has been made within a reasonable time from the date of communication of the original proposal. In this case, acceptance was made within a reasonable time, and so there was a good and valid contract." The question of offer and acceptance in different terms arose in Hazi Mohd. Hazi Jiva vs. E. Spinner(4). In this case, acceptance was made within a reasonable time, and so there was a good and valid contract." The question of offer and acceptance in different terms arose in Hazi Mohd. Hazi Jiva vs. E. Spinner(4). Sir L.H. Jenkins, C.J. observed: "The law on this point is thus formulated in the most authoritative mode by the Contract Act (IX of 1872), Sec. 7: In order to convert a proposal into a promise the acceptance must be absolute and unqualified. That is to say, until there is such an acceptance the stage of negotiations has not been passed, and no legal obligation is imposed. Similarly, any departure from the terms of the offer or any qualification vitiates the acceptance it accompanies unless it is agreed to by the person from whom the offer comes. In other words, an acceptance with a variation is no acceptance; it is simply a counter proposal, which must be accepted by the original promisor before a contract is made." Keeping the guiding principles which have been laid down in the aforesaid decisions and section 7 of the Contract Act, it is clear to my mind that by a positive and unqualified assent to the proposer, the acceptor must in effect agree to make precisely a promissory request and that the variation of any material term or any substantial modification has the effect of rejecting the proposal. The time of performance of a contract is a material term and variation in regard to it is a substantial variation in a contract. It may be recalled here that in the tender notice (Ex. 3), it is clearly mentioned in clause 5 that successful tenderers have to supply goods ordered within a period of one month from the date of the receipt of the order whereas in the letter (Ex.4), Note (iv) has been given that all the items should be supplied immediately. Such acceptance cannot be said to be absolute and unqualified. There has been a variation to modification in regard to period of supply of articles. This in my opinion amounted to a counter offer and rejection of the offer made by the plaintiff. The counter offer made in the order (Ex.4) was accepted by the plaintiff at Jodhpur and, therefore, the binding and concluded contract came into existence at Jodhpur and, therefore, the cause of action arose at Jodhpur. This in my opinion amounted to a counter offer and rejection of the offer made by the plaintiff. The counter offer made in the order (Ex.4) was accepted by the plaintiff at Jodhpur and, therefore, the binding and concluded contract came into existence at Jodhpur and, therefore, the cause of action arose at Jodhpur. The acceptance of the counter offer by the plaintiff has resulted in a contract, whose situs is Jodhpur, where the counter-offer (letter Ex 4) was received and accepted. Reference in this connection may be made to Ramdas vs. Firm Laxmi Chand Kashiram(5). I find myself unable to agree with the learned Additional District Judge, Jodhpur when he held that no new terms were inserted vide letter (Ex. 4). There was variation or modification of the term relating to the time for supply of articles and, therefore, the part of cause of action arose at Jodhpur and in this view of the matter, under section 20 (c) C.P.C., the Court at Jodhpur has jurisdiction to try the suit. 13. The matter does not rest at that Mr. Shishodia, learned counsel for the appellant submitted that the allegations made in the plaint should be scrutinised to determine if any of the facts stated therein are required to be proved if traversed for giving a judgment in the case and it is also to be seen whether articles were delivered at a particular place, where the suit is filed, Mr. Shishodia further submitted that after accepting the tender, letter(Ex 4) was sent in a registered cover to the plaintiff at Jodhpur in which one condition was added, with variation. In para 13 of the plaint, it has been stated that the articles sent by the plaintiff were wrongly rejected by the defendant vide letter No. 5642 dated October 24,1966. In reply to these averments, the defendants have stated that they have every right to reject the goods and not to make payment. According to Mr. Shishodia, the facts stated in para 13 of the plaint give rise to a part of the cause of action and so, under s. 20(C) C.P.C, the suit is triable by the Court at Jodhpur. 14. According to Mr. Shishodia, the facts stated in para 13 of the plaint give rise to a part of the cause of action and so, under s. 20(C) C.P.C, the suit is triable by the Court at Jodhpur. 14. In Khalil Khan vs. Mahbub Ali Khan (6), the meaning of the expression cause of action has been stated in the following words: "Every fact which will be necessary for the plaintiff to prove if traversed in order to support his right to the judgment and has no relation whatever to the defence that may be set up by the defendant nor does it depend upon the character of the relief prayed for by the plaintiff. It refers to the media upon which the plaintiff asks the Court to arrive at a conclusion in his favour." It was held in Arthur Butler and Co. Ltd. vs. District Board of Gaya(7) that where a contract which was completed with the plaintiff at G and was cancelled or revoked at M by a telegram which was followed by a letter and the plaintiff sued for damages, for breach of the contract in a Court situate at M alleging the receipt of the telegram and the letter at M, the Court at M had full jurisdiction to try the suit. Arthur Butler and Co. Ltd. case (7) and Khalil Khans case (6), were followed in Sanatan Dharam College vs. The Punjab University, etc (8). 15. In Fertilizer Corpn. of India vs. Sanjit Kumar(9) the letter of resignation i.e. revocation of the service-contract was sent from S but it was received by the plaintiff Company at N from where the letter of acceptance of resignation was despatched. It was hold that the forum of N had full jurisdiction to try the suit as the revocation of contract was completed at N. 16. In M/s Raja Brothers vs. Chanrai Uttamchand(l0), the Delhi High Court took the view that the receipt of the offer in Delhi and the receipt of the revocation in Delhi are certainly important parts of the cause of action and even if it be accepted for the sake of argument that the acceptance was not in Delhi, the aforesaid two facts by themselves would be enough to confer jurisdiction on the Delhi High Court. 17. Respectfully following the principles laid down in the Patna, Punjab and Delhi cases. 17. Respectfully following the principles laid down in the Patna, Punjab and Delhi cases. I am of opinion that the facts stated in para 13 of the plaint give rise to a part of the cause of action The communication of the rejection of the goods by the letter dated October 24, 1966 and the receipt of the letter at Jodhpur furnish a cause of] action and, therefore, the part of the cause of action arose at Jodhpur and in this view of the matter also, the Court at Jodhpur has jurisdiction to entertain and try the suit of the plaintiff. 18. In view of the aforesaid conclusions, it is not necessary to examine the other contentions of Mr. Shishodia. 19. The net result of the above discussion is that the Court at Jodhpur has jurisdiction to entertain and try the suit instituted by the plaintiff. The learned Additional District Judge committed an error in deciding issue No. 7 against the plaintiff I reverse the finding of issue No. 7 and hold that the part of cause of action arose at Jodhpur and, therefore, the Court at Jodhpur has jurisdiction to try and hear the suit of the plaintiff. 20. The result is that I allow this appeal and set aside the order dated July 26,1971 of the Additional District Judge No. 1, Jodhpur, by which, he ordered for the return of the plaint under O. VII r. 10 C.P.C. for its presentation to the Court having jurisdiction to entertain and hear it. The learned Additional District Judge No. 1, Jodhpur will take further proceedings in the suit in accordance with law. As the suit was instituted on April 10, 1967, the learned Additional District Judge No. 1, Jodhpur will make endeavour to conclude its trial expeditiously. As no body has appeared on behalf of the respondent to oppose the appeal, there will be no order as to costs of this appeal.