RAMALINGA MUDALIAR (DIED) Vs. SRMUTHUSWAMI AIYAR AND SONS, THROUGH ONE OF ITS PARTNERS SRMUTHUSWAMI AIYAR

JUDGEMENT

(1.) But for illustration (r) to Section 73 of the Indian Contract Act, I should have felt very little difficulty about this case. It was a case of a sale of goods where the buyer agreed to pay considerable sums of money by way of advance before the due time for delivery of the goods and where the seller defaulted in the end and did not deliver the goods he had contracted to deliver. Under the contract the advances were merely in anticipation of the purchase price and there was no provision that interest on them should be credited to the buyer against the final adjustment. In this case the buyer has brought a suit in which he has not pressed for his ordinary remedy, namely, the difference between the contract price and the market price at the date of breach but has merely asked for the return of his deposit with interest. The question that has been referred to us is whether, if he elects such a remedy, he can have back not merely his deposit, which is not contested, but interest upon it during the time that it was in the hands of the seller.

(2.) It is not now seriously contested that if his claim for the return of his deposit as advance is to be regarded as being in any way corresponding to the common law claim for the return of money had and received to his use as on a failure of consideration, he cannot be entitled to interest. Lord Tenterden's Act, 3 and 4 William IV, Ch. 42, Section 28 obviously does not provide for such a case as this and 1 think it is quite clear that the Indian Interest Act of 1839 is a mere repetition for this country of the provisions of Lord Tenterden's Act.

(3.) But the plaintiff puts his case on a different ground. He puts it as a claim by way of damages flowing from the Breach of contract of the seller and it is quite clear that if he has two causes of action he is entitled to pursue only one of them and give up the other, namely, the cause of action for money had and received to his use. It was practically agreed during the discussion that if the plaintiff's contention was right he would be entitled to claim damages under two heads; he will be entitled (1) to the difference between the contract and the market price, and (2) in addition, to interest in the nature of damages for being kept out of the money which he paid as advances. If the latter claim is well founded, it cannot prejudice the plaintiff that he has not thought it worth while to pursue the former. On general principles that contention seems to me unsound, and I think one must test it on the footing that if the plaintiff was right at all he can recover damages under both these heads cumulatively although he has only chosen in this particular instance to ask under one. It appears to me that the contract having been broken, all that the plaintiff can be entitled to is to be put in the same position as if it had been carried out.Had it been carried out, he would have been in this position; he would have advanced money under the contract without interest and he would have received the goods at the contract rate. Instead, we are to deal with it on the footing that he goes into the market and has to buy corresponding goods at a higher rate. That which puts him where he ought to have been if the contract Had been carried out is to get the difference between the contract price and the market price plus the amount of the advance that he made which ex hypothesi would not have borne interest if the contract had been executed. If he is to be given interest on his advance as well as the difference between the contract and the market rate, he is being enabled to put money into his pocket which he would not have had, if the contract had been carried out.