SATYENDRA NATH SINHA Vs. AKHIL CHANDRA BAGCHI

JUDGEMENT

(1.) This is a suit for a declaration that a hire-purchase agreement dated 19 April 1937 has been determined by breach on the part of the defendant, and for an order that the defendant do make over to the plaintiffs certain machinery, the subject-matter of the agreement. The defendant admits having entered into the hire-purchase agreement, but he denies that the machinery which is the subject-matter of that agreement belonged to the plaintiffs. He also sets up an agreement entered into between the plaintiffs and himself and two other persons for the flotation of a limited company. He denies having committed any breach of the hire- purchase agreement, and contends that that agreement came to an end by reason of this alleged agreement for the flotation of a company.

(2.) The defendant spent some time in Japan and while there he ordered machinery for tin printing, tin varnishing and zinc grinding, amongst other machinery, and intended to set up a factory on his return to India. He had not the funds to pay the balance of the purchase price on the machinery, and he therefore came to plaintiff 1, Mr. Satyendra Nath Sinha, to put him in funds and finance these purchases. Mr. Sinha apparently took considerable interest in the proposed business and made various advances to the defendant. Plaintiff 2 also advanced money, but apparently his arrangement was a private arrangement with Mr. Sinha, though he was aware that the money that he was putting up was being used by Sinha to finance the defendant. The hire-purchase agreement was made on 19 April 1937.

(3.) On 12 December 1936 the defendant calling himself the "managing director" of the Hindusthan Sheet and Metal Works wrote to the first plaintiff, Sinha, stating that he had sent a letter of authority to the Oriental Machinery Supplying Agency Limited to deliver machinery to the plaintiff on his payment of the money which would fall due. The Oriental Machinery Supplying Agency were apparently in direct communication with the Japanese firm of manufacturers, and they wrote to the present plaintiffs on 18 December referring to the letter of the Hindusthan Sheet and Metal Works, to which I have just referred, stating that they were agreeable to indent for the machinery on the plaintiffs advancing Rs. 1000 on that day, Rs. 500 on 21 December, and Rs. 1000 or so on arrival of the consignment. They also gave notice that they would charge a commission of one per cent. on the total value of the machinery which they stated to be about Rs. 7500. That was the value which had been placed upon the machinery by Mr. Bagchi, the defendant, both to the Oriental Machinery Supplying Agency Ltd. and to the plaintiffs.