RAM CHANDRA MISRA Vs. GANESH CHANDRA GANGOPADHYA

JUDGEMENT

(1.) The suit out of which this appeal arises was a suit for the refund of money paid as an advance on a lease there after to be executed which, in fact, was not executed. The circumstances, stated briefly, are as follows. The plaintiffs were desirous to enter into coal mining operations and for that purpose to obtain the underground rights in 601 bighas of land in village Kaniapur. In this village defendants owned a three annas share. The plaintiffs had separately negotiated but without success with the co-sharers of the defendants for a transfer of their interest in this property. Upon the failure of this negotiation, the plaintiffs entered into an arrangement with the defendants that the latter should lease to them their own share and twelve and a half annas more belonging to their co- sharers and also should guarantee them for coal mining purposes the peaceful possession of the remaining half anna share.

(2.) A draft lease, dated the 30th October 1908, was drawn up embodying the terms, and a sum of Rs. 13,052 was paid on account by the plaintiffs to the defendants. Subsequently, certain other sums were also paid in furtherance of the transaction, making the amount paid by the plaintiffs a total sum of Rs. 14,032. The lease was never executed, and the plaintiffs sued to recover this sum with interest. The defendants contested the suit principally on the grounds that they had given the plaintiffs no covenant of title, that they were willing themselves to carry out the contract, and that it was not they but the plaintiffs who had made default in its performance, that the plaintiffs were not entitled to rescind the contract, and that for these reasons the defendants had incurred no liability. The learned Subordinate Judge has found against them on all these points, and he has held that the contract was void, that the defendants had expressly bound themselves to indemnify the plaintiffs for the sum of Rs. 13,052 received by them and that the defendants are also liable for the incidental expenses incurred by the plaintiffs in addition to this sum. He has, accordingly, decreed the plaintiffs suit in full. Against this decision the defendants appeal.

(3.) On appeal, it is argued that the finding of the learned Subordinate Judge that there was a covenant of title is mistaken, and that he should have held that nothing but possession was guaranteed, that the defendants have and always had the title to the land which they claimed to have when the contract was entered into, that the plaintiffs had as much knowledge of this title as the defendants, that the defendants are now and have always been ready to make over the land to them with this title, and thereby fulfil the contract as understood at the time it was made both by the plaintiffs and the defendants, that there has been no misrepresentation, that the contract was accepted by the plaintiffs according to the law as then understood and that the plaintiffs cannot rescind it on account of any change which has since been made in the law. On these main grounds the appellants urge that the whole of the plaintiffs claim should have been rejected. Apart from their main argument, they urge that if the plaintiffs are entitled to recover anything at all from the defendants, they cannot claim to recover either a sum of Rs. 9,465 out of the total sum of Rs. 13,052 which was paid to the defendants not for any benefit of their own but merely as agents, or the incidental sum paid in addition to the sum of Rs. 13,052.