B N MATHUR Vs. UNION OF INDIA

JUDGEMENT

(1.) THE defendants in O. S. No. 3476 of 1964, on the file of the City Civil Court, madras, are the appellants herein.

(2.) THE facts are not in controversy, and the appeal itself lies within a narrow compass, and, therefore, we do not propose to refer to the pleadings of the parties in extenso in this appeal. One Mr. Fred Reist, Field representative of Pratt and whitney Engineers Division of United Craft Export Corporation of U. S. A. , applied on 10-10-1956 for a permit to bring into India with him his personal Mercedece benz car from Manilla. The application was rejected on 28-11-1956, on the ground that a licence could not be issued for import of a built-up-car. But no appeals by the appellant herein for and on behalf of the said Fred Reist, a Customs Clearance permit dated 15-1-1957, marked as Ex. A-1 in these proceedings, was issued to him as a special case to bring his car into India. This permit imposed a condition that the car imported against the said permit should be re-exported, when the licencee leaves this country. The covering letter dated 16-1-1957 (Ex. A-1) made it clear that the said condition about re-export would not be relaxed on any account. Subsequently the first appellant, as the agent of the said Fred Reist, and the second appellant, as a surety executed Ex. A-2 bond. Under this bond, they undertook that they would not sell or dispose the care when the same is in India and that they would procure and deliver to the Joint Chief Controller of Imports and Exports, Madras, within one month or such extended period as may be allowed by the said Joint Chief Controller of Imports, Madras from the date of departure from India of the said Fred Reist, evidence to prove that the car had been re-exported out of India. They further undertook that in lieu of the delivery of evidence as referred to above, the first appellant and his heirs or representatives, shall, upon demand by the Joint Chief Controller of Imports and exports, Madras, pay or cause to be paid to him a sum of Rupees 13,923. 10, in which case the bond shall become void and of no effect; otherwise the bond shall be and remain in force. The second appellant, was we have pointed out already, joined the execution of the bond as a surety. The bond is dated 16-4-1957, and the said bond was accepted by the Joint Chief Controller of Imports and Exports, madras. In October 1961, the Joint Chief Controller of Imports and Exports, madras, learnt that Mr. Reist left India for the United States of America on 2-51959, but the car was not re-exported, and was being used by the first appellant herein as the representative of Messrs. L. A. Lewis, INC. On this, a notice was issued by the Joint Chief Controller of Imports and Exports, Madras, to the first appellant herein to produce evidence to show that the car was re-exported. No such evidence being produced, the Joint Chief Controller of Imports and Exports, madras called upon the first appellant to re-export the car within a fixed time. Correspondence ensued between the appellants and the Joint Chief Controller of imports and Exports, Madras in which the appellants took the stand that the car was involved in a serious accident, and, therefore, commercially, it was not worthwhile re-exporting the car, because the cost of re-export would exceed the value of the car in that condition, and consequently, they were seeking the permission of the Government of India, to sell the car in India, either privately or through the State Trading Corporation. Ultimately, no such permission was granted by the Government of India, and thereafter, after issuing a notice to the appellants through the Government Pleader, Madras, the present suit was instituted to enforce the bond, Ex. A-2 and recover the sum of Rs. 13,923/10 with interest at six per cent, per annum.

(3.) IN the written statement filed by the first defendant, which was adopted by the second defendant, the facts were not disputed. The contention that was put forward by way of defence to the suit was that the license was granted to Fred reist, and with reference to that license, the appellants cannot be penalised for the failure on the part of Fred Reist to re-export the car. Another contention that was put forward by the appellants was that the Joint Chief Controller of Imports and Exports could not represent the Union of India for the purpose of filing the suit. Lastly, they contended that the provision for payment of the amount in Ex. A2 was in the nature of penalty, and the court should relieve the appellants of the said penalty. Yet another plea raised by the appellants was that since the car met with a severe accident, it could not be exported and, therefore, the contract became impossible of performance.