The Ganganagar Sugar Mills Ltd. v. Madanlal Ramswaroop Dhanmandi
2000-02-09
RAJESH BALIA
body2000
DigiLaw.ai
Judgment Rajesh Balia, J.-This is defendants’ appeal against the Judgment and decree passed by the Addl. District Judge No.1 Sri Ganganagar on 210.87 by which the plaintiffs suit for recovering Rs. 19105/-was decreed with costs. Interest 10% since the date of filing of the suit until recovery was also awarded. (2). The plaintiff-respondent is a registered firm dealing in sugar and other provision. The appellant-defendant no.1 is a Company registered under the Companies Act and is engaged in manufacturing the sugar and the sugar is sold to the licence-holders. Defendant No.2 is the part of defendant no. 1 who is alleged to have sold the sugar at fair price to employees of defendant no. 1 Company and is not a separate entity. (3). On promulgation of the Sugar (Price Control) Order 1979 on 19.79 by the Central Government in exercise of its powers u/Sec. 3 of the Essential Commodities Act, 1955, the maximum ex-factory price of sugar as well as maximum price at which sugar could be sold in retail was fixed. According to the said Order of 1979, a manufacturer in Rajasthan could sale the sugar manufactured by him at maximum ex-factory price of Rs. 268/-pet quintal which was inclusive of Excise Duty and the dealer could sale the sugar at Rs. 2/98 paisa per kg. The defendant no.1 had refused to sell the sugar at the maximum price fixed under Control Order. In order to defeat the said provision and avoid consequences defendant no.1 Company devised a method under which it purports to sale sugar in the name of defendant No.2 at Rs. 285/15 paisa per quintal. Through this device the defendant no.1 sold 1114 bags of sugar Rs. 285.15 paisa per quintal and recovered the price of the same which was more than maximum ex-factory price which defendant No.1 could lawfully charge of sales made by him. It was also alleged that bills have been provided in the name of defendant no.1. The name of defendant no.2 was added in all the bills which were issued by defendant no.1 under the signatures of its own officer and payment also was made and received by the defendant no.1 in its own name. The defendant no2 was alleged to be only a front. It was also alleged that defendant no.2 did not have any licence.
The defendant no2 was alleged to be only a front. It was also alleged that defendant no.2 did not have any licence. The sugar at cheap price was sold to the workers of the factory at the outlet. Defendant No.2 had no licence to sell sugar in wholesale and thus the defendant no. 1 has recovered Rs. 17.15 paisa per quintal in excess of ex-factory price at which the manufacturer was authorised to sell under the Order of 1979, from the plaintiff dealer to which he is entitled to restitution. The total amount recovered in excess was Rs. 19,105/-In support of its claim, the plaintiff also pleaded that according to bye-laws and the Rules framed under the Rajasthan Agricultural Produce Market Act, 1961, the market fee is levied on the first sale of the product and not thereafter. In the bills given to the plaintiff , the defendant has charged the market fees which goes to show that it was the first sale by the manufacturer and intermediary there was no transaction between the manufacturer defendant No.1 and the so called shop defendant No.2. On these assertions the plaintiff claimed decree for Rs. 19,105/-. (4). The defendants denied the claim of the petitioner inter alia on the ground that defendant no.2 had independent licence. The defendant no.1 has not entered into any transaction of the sale with the plaintiff The defendant no.2 has sold the sugar to defendant no.1 and the defendant no.2, who had sold the sugar in question to the plaintiff at Rs. 285.15 paisa per quintal was not under an obligation to sell the sugar at Rs. 268/ - per quintal to the plaintiff Therefore, it was alleged, that sale by defendant No.2 to plaintiff was not in breach of the Control Order. The allegations that the defendant No.2 was only a front of defendant no. 1 was denied. (5).
285.15 paisa per quintal was not under an obligation to sell the sugar at Rs. 268/ - per quintal to the plaintiff Therefore, it was alleged, that sale by defendant No.2 to plaintiff was not in breach of the Control Order. The allegations that the defendant No.2 was only a front of defendant no. 1 was denied. (5). Following five issues were framed on the pleadings of parties: ¼1½ D;k okn&i= dh Øe la-5 esa fy[ks vuqlkj izfroknh la- 1 us Hkkjr ljdkj }kjk fu/kkZfjr ewY; 268@& w#- ,Dlkbt M;~Vh lfgr ij] phuh foØ; djus ls euk dj fn;k] bl ij jkT; ljdkj us vius i= fnukad 26-09-1979 }kjk izfroknh ua- 1 ds LFkkuh; dk;kZy; dks Li"V vknsk fn;k fd og Hkkjr ljdkj ds vknsk 97 ds vUrxZr fu/kkZfjr ewY; ij gh phuh foØ; djs vkSj ;fn , slk gS rks bldk okn ij D;k izHkko gS\ ft- oknh ¼2½ D;k okn&i= dh Øe la- 8 o 8 esa fy[ks vuqlkj oknh dks phuh dk foØ; izfroknh ua- 1 us gh fd;k gS vkSj izfroknh la- 2 rks dsoy uketn gh gS vkSj ;fn , slk gS rks bldk nkos ij d;k izHkko gS\ ft- oknh ¼3½ D;k izfroknhx.k }kjk phuh dk ewY; 285-15 #- izfr fDo- ls olwy fd;k x;k gS tks okn&i= dh Øe la-10 esa fy[ks vuqlkj] fof /k fo#) gS vkSj bl dkj.k oknh 19]105@& #-izfroknhx.k ls okfil izkIr djus dk vf /kdkjh gS\ ft- oknh ¼4½ D;k izfroknhx.k 3]000@& #- foks"k gjtk ikus ds vf /kdkjh gSa\ ft- izfroknhx.k¼5½ i{kdkjku fdl lgk;rk ds ik= gSa\ (6). The trial Court decided issues no. 1,2 & in favour of the plaintiff by finding that defendant no.2 is not independent of defendant No.1 and does not make a separate entity. The sale of the sugar in question was directly made by the defendant No. 1 Rs. 285.15 paisa per quintal which was contrary to Sugar Price Control Order, and the plaintiff is entitled to recover the excess amount charged by the defendant No.1. Accordingly suit was decreed. (7). Firstly it has been contended that the trial Court has erred in finding that sale of sugar to the plaintiff has been made by the defendant No.1. and not by defendant No.2. Infact the defendant No.1 has sold the sugar manufactured by it to defendant No.2, another undertaking of defendant No.1.
Accordingly suit was decreed. (7). Firstly it has been contended that the trial Court has erred in finding that sale of sugar to the plaintiff has been made by the defendant No.1. and not by defendant No.2. Infact the defendant No.1 has sold the sugar manufactured by it to defendant No.2, another undertaking of defendant No.1. Therefore the subsequent sale by defendant no.2 to the plaintiff is not in breach of the provisions of the Sugar Price Control Order inasmuch as the commodity was not sold by the manufacturer and was infact sold at a price at which it could be sold to retailer. It was contended by the learned Counsel for the appellants that Sugar Price Control Order regulated price of sugar sold by the manufacturer at ex-factory price and of the sugar sold by dealers to retail purchasers. In the former case price for sale by manufacturers was fixed at maximum Rs. 268/-per quintal within the State of Rajasthan, for the purpose of retailing price fixed was Rs. 2.98/-per kg. (That makes at Ks. 298/-per quintal). The sugar was sold by the manufacturer defendant No.1 at ex-factory price to the defendant No.2 and thereafter defendant No.2 sold it to the plaintiff Defendant No.2 is not a manufacturer, and the plaintiff is not a purchaser in retail. Hence the transaction in question did not come within the mischief of Sugar Price Control Order, No price was fixed for inter-dealers sales or by wholesale dealers to retail dealers. (8). Learned Counsel for the respondent on the other hand urged that defendant No.1 and defendant No.2 are not separate entities. The defendant No.1 could not have sold goods to himself in his capacity as defendant No.2. Moreover, from the evidence it has been proved that goods have been sold at factory gate by calling the stock from the factory godown of the defendant No.1. Goods have not been sold by so-called defendant No.2 from its own stocks. (9). Having carefully considered the rival contention and material on record and the pleadings of the parties I am of the opinion that finding on issue No. 1 covering this aspect of the contention has been rightly reached by the trial Court against the defendant. Plaintiff has clearly pleaded that defendant no.1 was selling sugar through defendant No.2 which is part of defendant No. 1.
Plaintiff has clearly pleaded that defendant no.1 was selling sugar through defendant No.2 which is part of defendant No. 1. Defendant No. 2 has no authority of selling the sugar as a dealer on his own but was selling under the cover of the licence of defendant No.1. The ‘mandi shulk’ has also been charged as if it was the first transaction in the chain of sales on behalf of defendant No.1. One Satyanarain, Accounts Officer has been examined in support of its plea that it has sold entire production of sugar at Rs. 268/-per quintal to defendant No.2 who held a separate licence of wholesale dealer of sugar and plaintiff has purchased the sugar from an independent entity defendant no.2 at Rs. 285.15 paisa per quintal. Defendant no.2 has not examined any independent witness on its own. The said Satyanarain though has stated on 19th March, 1987 when examined for the first instance, that the Mills defendant No. 1 did not sell the sugar to plaintiff but defendant No.2, the fair price shop sold the sugar to the plaintiff , he did not ever say a word that factory sold the sugar manufactured by it to defendant No. 2. It is only stated that Ganganagar Sugar Mills Fair Price Shop sold 1114 bags of sugar to the plaintiffs firm. The retail and wholesale shop could have sold the sugar at a price higher than 268 per quintal. In cross-examination he admits that bills have been printed in the name of Ganganagar Sugar Mills only. ‘The Mill gate wholesale and fair price shop’ is written by hand. This witness expressed his inability to produce the wholesale dealers licence in favour of defendant No.2. He admitted that prior to 19.79, the date Control Order had come into force, no such sales to wholesale dealers had taken place from the shop. He further admitted that still in case of necessity defendant No. 1 conducts sales from the shop. He admitted that entire profit and loss of the said shop is accounted in the Mills. There is no separate Sales Manager or staff for the said shop. The godown for the shop and its office is also in the premises of Mills. He was unable to show whether the ‘pay orders’ received from the plaintiff in the name of Ganganagar Sugar Mills or not.
There is no separate Sales Manager or staff for the said shop. The godown for the shop and its office is also in the premises of Mills. He was unable to show whether the ‘pay orders’ received from the plaintiff in the name of Ganganagar Sugar Mills or not. He also admitted that ‘mandi shulk’ has been charged in the bills in question Ex.3 to Ex.7. This witness was again examined on 24th August, 1987. He again stated that wholesale fair price shop has obtained the licence under the Rajasthan Dealer Sugar Licence Order 1979 from the District Supply Officer as a wholesale and retail dealer but was again unable to produce the same because the original licence was not available in the office. In his cross-examination he pleads complete ignorance about the licence. From the fact that in March, 1987 this witness was made aware about querries relating to wholesaler dealer’s licence alleged to have been obtained in the name of wholesale price shop defendant No. 2, yet he pleaded his inability to produce the same, and was unable to give any satisfactory details to lend credence to that no separate licence as wholesaler dealer in sugar, independent of such licence in favour of Mills defendant No.1 existed. Legitimate interference from his statement is that he has never seen the licence nor he was aware about the existence of such licence. He has pleaded complete ignorance of the provision of any Sugar Control Orders about the price control or the dealer’s licence. While stating about stock register and entries therein, he admits that Stock Register which he has brought were got prepared under his supervision. The register does not contain opening and closing balance of the stock and is also not in accordance with prescribed form. However, he admits in his cross-examination that whenever wholesale fair price shop required sugar it used to withdraw from the stock of factory and delivered to the purchaser. This not only shows that the stocks of the Mills and the shop, alleged to be two separate establishments and independent units are not separate.
However, he admits in his cross-examination that whenever wholesale fair price shop required sugar it used to withdraw from the stock of factory and delivered to the purchaser. This not only shows that the stocks of the Mills and the shop, alleged to be two separate establishments and independent units are not separate. The statement in first instance that whenever needed the Mills sells through the shop, coupled with statement in second stance that whenever the shop needs stocks are withdrawn from Mill godown, and absolutely no separate management for shops, no separate maintenance of accounts and records capped with failure to produce any material to establish that any separate license existed in favour of defendant No.2 at the relevant time destroys the theory of independent existence of two different establishments or undertakings. No evidence about any sale or transfer of sugar manufactured by the defendant No.1 to defendant No.2 further leads to irresistible conclusion that sales in question were by the Mills defendant No.1, which was the only existing entity as juristic person, or business entity, sold the sugar-manufacturer by it at factory gate to the plaintiff Were the defendant No.2 independent of defendant No.1, defendant No.2 itself would have come forward to establish its transaction with plaintiff The very fact that defendant No.2 alleged to be having separate existence, did not lead any evidence in support of its existence or its business dealings and rest contended with defendant No.1 trying to make out a case for its independent existence and independent transaction itself cast a serious doubt about independent existence of defendant No.2 and sale of sugar by it to plaintiff . (10). It is further to be noticed that the plea of defendant pre- supposes transfer or sale of sugar manufactured by Mills defendant No. 1 to defendant No.2 at the control price, before successive transfer could take place by defendant No.2 to the plaintiff It takes two independent persons to exist between whom a transaction of transfer of sugar could take place. One cannot enter into any transaction with himself In these circumstances the theory of sale in question being 2nd in chain of successive sales, not falling within the breach of Sugar Control Order cannot be accepted. (11).
One cannot enter into any transaction with himself In these circumstances the theory of sale in question being 2nd in chain of successive sales, not falling within the breach of Sugar Control Order cannot be accepted. (11). Therefore, 1 am in agreement with the trial Court that sale of the sugar has taken place by defendant No.1 who is a manufacturer, to the plaintiff and from the admitted facts that stock godowns are situated at factory premises of Mill shop from where the transactions are alleged to have taken place too is situated at factory gate, such sales were ex-factory. There is no dispute that sale transaction have been taken place at 285.15 paisa per quintal and at the factory gate. It was in excess of Rs. 268/-the ex-factory price fixed for the sale by the manufacturer of sugar. (12). Faced with this situation learned Counsel for the appellants has urged that plaintiff even if has been charged more than the maximum price fixed under Sugar Price (Control) Order, he is not entitled to recover the excess price by way of refund under any provision of law. If price charged by the defendant no. 1 were in excess of the price fixed under the Control Order, the only consequence would be that no valid contract came into existence. In that event the plaintiff could return the goods and claim refund of entire price paid under the void contract. Further it cannot split the claim by enforcing the contract at the price fixed under the Control Order and claim refund of the excess amount charged. It was also urged that in the facts and circumstances of the present case it cannot he said that plaintiff has paid the amount under any mistake or coercion. He has purchased sugar knowingly at price in excess of the maximum price fixed under the Control Order.
It was also urged that in the facts and circumstances of the present case it cannot he said that plaintiff has paid the amount under any mistake or coercion. He has purchased sugar knowingly at price in excess of the maximum price fixed under the Control Order. The facts that the bills are issued by the Officer of the Company, that the name of fair price was written in the hands of the company Officer on the printed bill books of the Mills, and that ‘mandi shulk’ is being charged from them were known to the plaintiff While the manufacturer may be under an obligation not to sale goods manufactured by him at a higher price man fixed under the Control Order; no such corresponding right has been conferred on the purchaser to enforce that price against the seller manufacturer to sell his goods at the Control Price. The consequence of breach of the Price Control Order are provided by way of punishment through criminal prosecution and levy of penalties. The refund of excess price to the purchaser has not been provided in law. He invited attention to Section 15 of the Indian Contract Act: It was urged that no ingredients of coercion as envisaged therein is shown to exist to substantiate the claim of refund u/Sec. 72 of the Contract Act also. He therefore, urged that plaintiff cannot claim refund of such excess price even if it is held to be recovered by the defendant No.1 from the plaintiff inasmuch as provision of Section 72 of the Contract Act cannot be invoked in the present case. (13). He places reliance on decisions of Jagadish Prasad Pannalal v. Produce Exchange Corporation Ltd. (AIR 1946 Calcutta 245) and Lakshman Prasad & Sons v. Achutan Nair (AIR 1955 Madras 662). Learned Counsel for the appellants also relied on principle underlying Section 65 of the Contract Act: When an agreement is discovered to be void, or when it becomes void, the parties are bound to restore any advantage received under it or to compensate, for it, parties cannot split the consideration so as to recover the excess price paid over the controlled price. (14). At the very outset analogy drawn with the consequence of an agreement which is void in its entirety in the facts and circumstances of the present case appears to be inapt.
(14). At the very outset analogy drawn with the consequence of an agreement which is void in its entirety in the facts and circumstances of the present case appears to be inapt. It is of importance to note that the Sugar Price Control Order neither prohibits nor controls the freedom of respective parties to enter into an agreement to sell and purchase the commodity price of which is regulated through the Control Order. The object of such control orders is to regulate the trade in particular commodity declared to be Essential Commodity but does not prohibit the dealers from entering into contract within that sphere. It only affects the freedom of the parties to transgress those limits to negotiate and settle the price of commodity they have agreed to sale and buy through the transaction. (15). As a matter of fact where the price is fixed rigidly of the commodity to be transacted, the freedom of bargaining the consideration of the subject of sale and purchase is restricted in the sense that so far as freedom of agreeing price at which the commodity is to be transacted is determined not by agreement between the parties but by statute. The consideration is statutorily fixed, if the statute leaves some room for such bargaining the contracting parties may move within that room but not beyond it. Therefore, it is rather misnomer to say that where parties enter into an agreement to sale the goods whose price is controlled by the Control Order at price beyond the regulation the contract becomes void in its entirety, merely because the party with superior bargaining capacity is able to force the price more than what the maximum limit fixed by the statute on the buyer. If he continues to deal in regulated commodity he can be compelled to charge only such price as is permissible in law. The term as to consideration, shall be rendered void to the extent if travels beyond the permissible territory. (16). One cannot lose site of the purpose of the statute with which we are concerned. The Sugar Price Control Order 1979 was promulgated with the object of securing equitable distriction and availability of Sugar which was declared as an Essential Commodity, at a fair price to consumers as is evident from preamble of the Order, Regulation of price is in furtherance of that object only.
The Sugar Price Control Order 1979 was promulgated with the object of securing equitable distriction and availability of Sugar which was declared as an Essential Commodity, at a fair price to consumers as is evident from preamble of the Order, Regulation of price is in furtherance of that object only. If the person, who are part of distribution system and put under obligation to charge price of commodities with them within permissible limits take resort in a device through which buyers of the commodity are subjected to charge of excess price than permissible under law because of the superior bargaining power of the seller and the buyer is rendered remediless in seeking restitution of the excess price charged from him, it will defeat the very object of the beneficial legislation. If by confronting the buyer with the choice either to buy at the price dictated by the manufacturer seller or to go without the commodity because he cannot enforce the price at which he is to get the sugar under law, this would be plainly to defeat the very object of the Order with which it has been enacted and leave the prices in the control of sellers. Deterrent consequences of penalty and imprisonment for the breach of provision of Control Order operate in the field of penalty of breaking law. Criminal liability of a person for a breach of law does not take away the civil liability flowing from the obligations cast under law. Beneficiaries of the statute has a right to secure the benefit flowing to them under the statute. When a person is put under an obligation to act in a particular manner towards another, corresponding right is created in such another person to seek that obligation under statute towards him is duly discharged by the person obligated. There is nothing in the statute or other law which prohibits such person from seeking remedies to secure the benefit of statute by enforcing the same against those who are under an obligation to deal in particular manner while charging price from the buyer. It has not been shown to us that in the absence of specific provision civil liability of a person is discharged because he is also liable for criminal prosecution.
It has not been shown to us that in the absence of specific provision civil liability of a person is discharged because he is also liable for criminal prosecution. Ordinary remedy to enforce law by person to whom the obligation under law is to be discharged is not taken away by not providing specific remedy under the statute. (17). In the cases like the one at hand doctrine of severibility can be invoked, viz, where the part of contract which is contrary to law is severable without affecting the substratum of the contract, then only that part of the contract may be held to be void and to the extent the term of contract is void, any party taking advantage referable to the void part of the term must return the same. Sec. 65 of the Contract Act does not enact contrary to this principle. It does not envisage that Sec. 65 can be invoked only when Contract is void in its entirety. In cases like the one where a person enters into a contract of sale in respect of a commodity, price of which is determined by statute, and term as to limits of consideration for goods to be subject of sale is determined by statute and not by volition, the term of agreement to the extent of fixing consideration more than chargeable under law only is rendered void and unenforceable, as the law favours transaction of sale at a fixed price or upto a maximum fixed price and charging of extra more price only is prohibited. (18). In this connection I am tempted to reproduce the words of Willes J in Rickering v. Ilfracombe Ry Co ((1868) 3 C P 235), as approved by the Apex Court in Central Inland Water Transport Corporation Ltd. v. Brojonath. “The general rule is that where you cannot severe the illegality from the legal part of a covenant, the contract is altogether void, but where you can severe thou, whether the illegally be created by statute or by common law, you may reject the bad part and retain the good.” (19). The Supreme Court in Central Inland Water Transport Corporation Ltd. (supra) on considering the various provisions of the Contract particularly Sees. 16, 19A, 23 & 24 approved doctrine of severibility of illegal part of agreement and saving the enforceability of valid part of the agreement. Referring to Sees.
The Supreme Court in Central Inland Water Transport Corporation Ltd. (supra) on considering the various provisions of the Contract particularly Sees. 16, 19A, 23 & 24 approved doctrine of severibility of illegal part of agreement and saving the enforceability of valid part of the agreement. Referring to Sees. 19A and 16 of the Contract Act the Court said: “Under Section 19A, when consent to an agreement is caused by undue influence, the agreement is a contract voidable at the option of the party whose consent was so caused and the Court may set aside any such contract either absolutely or if the party who was entitled to avoid had received any benefit thereunder upon such terms and conditions as the Court may seem just.” (20). Considering that under Section 23 any consideration or object of any agreement is lawful unless inter alia the Court regards it as opposed to public policy and further provides that every agreement object of which is unlawful is void and under Section 24 if any part of single consideration for one or more objects or any one or any part of any one of several consideration of a single object is unlawful the agreement is void, yet the Court said approving opinion of Willes J quoted above. “The agreement is, however not always void in its entirety.” (21). Considering the concept of freedom of contract is modern times the Court approved following comment from Chilly on contract. “Freedom of Contract’ it has been said is a reasonable social ideal only to the extent that equality of bargaining power between contracting parties can be assumed and no injury is done to economic interests of the community at large. Freedom of contract is of little value when one party has no alternative between accepting a set of terms proposed by the other or doing without the goods or services offered.” (22). With these premise and also accepting that in many fields legislation has interfered to prevent one party to a contract from taking undue or unfair advantage of the other and such legislative measure include. Control Orders relating to essential commodities the Court referred to position of such unconscionable terms qua their enforceability under American practice with a nod of approval.
With these premise and also accepting that in many fields legislation has interfered to prevent one party to a contract from taking undue or unfair advantage of the other and such legislative measure include. Control Orders relating to essential commodities the Court referred to position of such unconscionable terms qua their enforceability under American practice with a nod of approval. “If a contract or term thereof is unconscionable at the time the Contract is made a Court may refuse to enforce the contract or may enforce the remainder of the contract without the unconscionable term or may so limit the application of any unconscionable term as to avoid any unconscionable result.” (23). In the light of aforesaid it can be unhesitantly stated that by promulgating Sugar Price Control Order regulating the price of sugar, an essential commodity, the legislative authority has interfered with the freedom of contract of contracting parties to prevent the one party to the contract (seller) from taking undue and unfair advantage of the other (the buyer) in order to prevent profiteering from trade in essential commodities taking undue and unfair advantage of buyers’ poor bargaining capacity, either to buy or go without it. This curtailed the freedom of seller to fix the consideration of sugar beyond the permissible limit. Fixing of or charging price by a seller beyond limit fixed by law can properly be termed as unlawful and unconscionable term when the contract, was made, which may render the agreement void. Keeping in view the object of law and effectuate public policy behind the Control Order it is permissible for the Court to limit applicability of such unconscionable term so as to avoid unconscionable result, thus rejecting the bad part of the unlawful term and retain the good part of it as suggested by willes in Pickering’s case (supra) and approved by Apex Court in Central Inland Water Transport Corp. case (supra). (24). The issue may be looked from slight different perspective. The purpose of the said statute is not to punish the offenders but to devise the machinery by which the essential commodity is made available to the persons for whose benefit the law has been made, through the mechanism devised under the statute. Such an interpretation ought not be accepted which defeats the object of the Act and furthers defiance of law.
Such an interpretation ought not be accepted which defeats the object of the Act and furthers defiance of law. In such cases, the persons charged with more price than permitted by law has a remedy to recover excess price recovered from him than what is recoverable from him under law through appropriate legal proceedings. (25). The remedy is founded on the principle that no one is entitled to get unjust enrichment at the cost of the other. The provisions of the Contract Act envisages remedies or obligations under various situations where the contract becomes void or circumstances which do not fall strictly in the realm of contract but are quasi-contract. The principle of restitution of unjust enrichment is also expressed as enforcement of a claim based on doctrine of ‘money had and received’ by the defendant for the plaintiffs use. (26). Recovery for ‘money or advantage had and received for the plaintiff is not new and is not founded on any contract or legal right flowing from any statute, but on principle against unjust enrichment at the expense of others. Such obligations are considered quasi contractual. Sec. 68 to 72 in Chapter V of the Contract Act only provides certain instances in which such principle of restitution on equitable doctrine has been statutorily recognised. It does not detract from remedy available under civil law on conditions of such action being fulfilled in the absence of any legal prohibition. (27). The principle that wherever a person has wrongfully paid money, he may have it back again by this action for ‘money had and received’ to his use was embedded in Roman maxim ‘ex-quasi contractu’ as stated long back in Astley v. Reylnolds M. (5 G.2, BR): and was referred by Lord Mansfield in Moses v. Macferlan (97 ER 676 - (1760) 2 Burr 1005). Lord Mansfield analysed the principle emanating from Roman Law: ‘If the defendant be under an obligation from the law of natural justice to refund, the law implies a debt and gives this action founded in the equity of the plaintiffs case as it were on a contract (quasi ex contract) as the Roman Law expresses it.” He further explained: “This kind of equitable action, to recover back money, which ought not in justice to be kept is very beneficial, and therefore much encouraged.
It lies only for money which, ‘ex aequo et bono’, the defendant ought to refund; it does not lie for money paid by the plaintiff , which is claimed of him as payable in point of honour and honesty, although it could not have been recovered from him by any course of law; as in payment of a debt barred by the Statute of Limitations, or contracted during his infancy, or to the extent of principal and legal interest upon a usurious contract, or, for money fairly lost at play; because in all these cases, the defendant may retain it with a safe conscience, though by positive law he was barred from recovering. But it lies for money paid by mistake; or upon a consideration which happens to fail; or for money got through imposition (express or implied); or extortion; or oppression; or an undue advantage taken of the plaintiffs situation, contrary to laws made for the protection of persons under those circumstances”. (28). Lord Wright in Fibrosa Spolka Akcyjna v. Fairbairn Lawson Combe Barbour Ltd. (1942) 2 All E.R. (H.L.) quoting Lord Mansfield from Moses case (supra) said that above statement of Lord Mansfield has been the basis of modern law of quasi-contract and opined: “Lord Mansfield does not say that law implies a promise. The law implies a debt or obligation which is a different thing. The obligation is as efficacious as if it were upon a contract. The obligation is cre