SOUTHARN CHEMICAL WORKS Vs. MOHAMED HUSEIN FAKRUDDIN MANIAR

JUDGEMENT

(1.) THIS is a plaintiff's appeal against the dismissal of his suit for damages and it arises under the following circumstances:

(2.) THE plaintiff-firm manufactures Diamond Apicin and Diamond Jant-pudis at Miraj. The defendant is a trader at Sholapur. By an agreement dated January 2, 1959 between the plaintiff and the defendant, the defendant was appointed as the selling agent of the plaintiff's medicines for the Districts of Sholapur and Gulbarge, and for the Talukas of Humnabad, Tuljapur Latur and Indi. The agreement was to be in force for a period of three years. By this agreement the defendant undertook to purchase and sell a minimum of 80,000 pudis of Diamond Apicin and 5000 of Diamond Jant-pudis, agreeing further that the defendant would not discontinue the agency for the period of three years and if he did so, he would have to pay damages to the plaintiff. In pursu- ance of this contract, the defendant ordered some goods but it appears that by about February 1959, the Civil Surgeon at Sholapur ordered the defendant not to sell any of these articles as a wholesaler as the defendant had no licence for wholesale trade in drugs. It appears from the correspondence between the parties that the defendant had already made an application by about February 1959 for a wholesaler's licence under the Drugs Act and the correspondence further shows that he actually got the licence on June 6, 1959. Even so, by notice dated August 17, 1959, the defendant terminated the agreement on the ground that the agreement was void and illegal as the defendant had no licence when the agreement was entered into. He also made a statement in that notice that the goods of about five months were lying with him undisposed of as he had no licence, evidently a statement which was untrue, since he had already obtained a licence about two and a quarter months prior to the issue of this notice. It may be mentioned that the defendant got another agency. The plaintiff after some correspondence filed the present suit for damages claiming a sum of Rs. 70,000 from the defendant.

(3.) THE defendant resisted the suit contending that the agreement of agency was illegal and void as he had no wholesale licence when the agreement was entered into. He also questioned the amount of damages. The learned trial Judge held that the agreement was invalid in law and therefore unenforceable. He also gave a finding on the question of damages which he assessed at Rs. 20,527. In view of his finding on the first and the main issue, the learned Judge dismissed the suit. The plaintiff appeals.