M.P. VENKATACHALAPATHY IYER AND SONS, A FIRM OF REGISTERED PARTNERSHIP BY ONE OF ITS PARTNERS, M.P.V. RAMAMOORTHY Vs. BALASUBRAMANIAM AND ORS.

JUDGEMENT

(1.) THESE three appeals are against the dismissal of three suits, all for recovery of damages for breach of contract. Though the parties are not identical in the three suits, they came to be tried jointly, by consent of parties, as common questions of law and similar questions of fact arose in all these cases. A.S. No. 365 of 1967 is by the plaintiffs in O.S. No. 19 of 1963 A.S. No. 790 of 1967, is by the plaintiffs in O.S. No. 28 of 1963 and A.S. No. 533 of 1968 is by the plaintiffs in O.S. No. 32 of 1963 on the file of the Court of the Subordinate Judge, Madurai. In each of these suits, the claim was for damages for alleged breach of forward contracts in 40s count yarn of Sri Meenakshi Mills of Madurai, In each of the three suits, the respective plaintiffs were the purchasers and the defendants, the sellers under the forward contracts.

(2.) IT is common ground, that the months of delivery under the various forward contracts between the parties now in dispute are December, 1959 to March, 1960. There had been similar contracts for earlier months but there is no claim in respect of these contracts. According to the plaintiffs, they had been performed in accordance with the terms of the contracts but according to the defendants, the so -called performance during the earlier months was only by adjusting the difference between the contract price and the price fixed by the Yarn Merchants Association, for the months in which delivery was to be given as per the letter of contract. It is the case of the defendants that the parties to the suits who are yarn dealers as well as many other yarn dealers In Madurai, being members of the Yarn Merchants Association, Madurai (which is not a recognised association) have been indulging in betting in respect of 40s count yarn produced by the Sri Meenakshi Mills. According to them for a month only about 200 bales of 40s count were being produced by the said Mills that out of that quantum only a portion would be supplied by the Mills to the seven authorised dealers in Madurai (out of whom one is Seethalakshmi Ammal the second defendant in O.S. No. 19 of 1963), but the yarn merchants in Madurai who are members of the above said unrecognised association had been transacting "business" in over 2000 to 3000 bales of 40s count every month. It is their case that in the several forward contracts that had been entered into between the parties to the suit, the intention of the parties was not that there should be actual delivery but only the difference in the contract price and that fixed for the particular month by the Association, was to be adjusted between the parties.

(3.) THE Court below has accepted the case of the defendant and negatived the claim of the plaintiffs in all the three suits. It has held that all the suit contracts are nothing but wagers. It also found that. the contracts in question offend the provisions of the Forward Contracts (Regulation) Act (LXXIV of 1952)(hereinafter referred to as the Act). As far as O.S. No. 28 of 1963 is concerned, there is an additional plea, namely, one of limitation. It is not in dispute that if the time taken in prosecuting the Arbitration Proceedings, initiated by the plaintiffs in that suit, cannot be excluded in computing the period of limitation, then a part of the claim in that suit is barred by limitation. But according to the plaintiffs in that suit, Section 14 of the Limitation Act, applied and that the period during which the Arbitration Proceedings were pending should be excluded from computation. In this connection, the learned Counsel for the plaintiffs appellants referred to the decision of the Privy Council in RamdutRamkissen Dass v. E.D. Sassoon & Go., 1929 (56) M.L.J. 614 :, 115 Ind.Cas. 713 :, A.I.R. 1929 P.C. 103. But that is a case where it is held that even though Section 14 had no application to proceedings before the Arbitrator, the principle of that section may be applied. The question was whether the time taken in prosecuting the proceedings before an Arbitrator (who had jurisdiction) was to be excluded in respect of similar proceedings before another Arbitrator. This decision has no bearing on the facts of the present case. Here the plaintiffs in O.S. No. 28 of 1963 purported to take arbitration proceedings before the abovesaid Yarn Merchants Association. Ultimately after giving up the said proceedings, the suit was filed. If Section 14 of the Limitation Act, is to be invoked in this case, the other proceedings the period during which it was pending is sought to be excluded, should have been before a Court. Surely an Arbitrator is not a Court. Though the learned Counsel raised the contention that the finding of the Court below regarding limitation is not correct, ultimately he did not press that contention. Therefore, in any event, part of the claim in O.S. No. 28 of 1963, would be time -barred.