1. This Second Appeal is directed against the Judgment and Order dated 10/2/2003 passed by the Additional District Judge, Panaji (First Appellate Court) in Regular Civil Appeal No. 8/2000.
2. The said Regular Civil Appeal was filed against the Judgment and Decree dated 9/12/1999 of the Civil Judge, Senior Division, Panaji (Trial Court), passed in Special Civil Suit no.54/90/B.
3. The appellant of the present Second Appeal is the defendant of the said Special Civil Suit No.54/90/B, whereas the respondent is the plaintiff. The Trial Court had decreed the suit with costs and had dismissed the Counter claim of the defendant. The defendant has been directed to pay to the plaintiff the balance amount of Rs.49,596.30 paise along with interest at the rate of 18% per annum thereon from 20/2/1990 till final payment and on payment being made to the plaintiff, the plaintiff has been ordered to supply the computer equipment to the defendant as per the purchase order dated 17.11.1989.
4. By the judgment in Regular Civil Appeal No.8/2000, the First Appellate Court has dismissed the appeal and has maintained the decree of the Trial Court. The defendant of the suit is aggrieved with the said judgments.
5. The parties shall hereinafter be referred to as per their status in the said Special Civil Suit.
6. The plaintiff had filed the said suit for recovery of money. The case of the plaintiff was as follows:
The plaintiff is doing the business of marketing computers and the defendant had placed an order no. DXC/MWA/A-1/89-90 dated 17.11.1989 with the plaintiff for purchase of a computer system for a total price of Rs.66,096.30 paise. The defendant had paid to the plaintiff a sum of Rs. 16,500/- as advance of 25%. On receiving the said order, the plaintiff placed the order for equipment with his principal that is HCL at Bangalore on payment of the full amount. By letters dated 8/12/1989 and 12/1/1990, the plaintiff requested the defendant to remit the balance of the purchase price to enable the plaintiff to deliver and install the computer system and the plaintiff also submitted the documents to the defendant’s banker, that is State Bank of India, Margao branch, for recovery of the balance amount of 75% towards the purchase price. But the said bank did not honour the documents nor did it pay the balance amount. The plaintiff, thereafter, by letter dated 2/2/1990 had informed the defendant about the fact that the equipment had arrived and was lying with the plaintiff for the last about three weeks and the balance price had not been received. The plaintiff, therefore, requested the defendant to pay the balance amount within two weeks of the receipt of the said letter and stated that failure would leave the plaintiff with no other alternative, but to recover the balance amount from the defendant. By notice dated 16/2/1990, the defendant through her Advocate made untenable submissions and refused to pay the balance amount and sought for refund of the advance. In view of the purchase order, the defendant had agreed to purchase the equipment and was bound to pay to the plaintiff the entire purchase price. Therefore, the plaintiff is entitled to recover the balance amount of the sale price of Rs. 49,596.30 paise, with interest at the rate of 20% per annum from 20/2/1990.
7. The defendant, by way of written statement, admitted that she had placed order with the plaintiff for purchase of HCL BUSYBEE PCT/XT COMPUTER SYSTEM. But she claimed that the plaintiff had failed to submit the documents to her bankers at Margao for recovery of the balance amount of 75% of the purchase price and thereby caused severe damage to her business. She stated that she did not reply to the plaintiff's letters dated 8/12/1980 and 12/1/1990 because their contents were contrary to the clauses of the agreement dated 17/11/1989. The defendant claimed that she is entitled to recover from the plaintiff the sum of Rs.16,500/- with interest at the rate of 20% per annum. The defendant raised a Counter claim towards her said claim.
8. The plaintiff filed written statement to the Counter claim denying that he had not submitted the documents to the defendant’s bankers. The plaintiff denied the case of the defendant.
9. Upon consideration of the evidence on record, the Trial Court held that the evidence proves that the plaintiff had purchased the computer system from its supplier at Bangalore after making full payment and he had submitted the documents to the defendant's bank for payment of the balance amount. The Trial Court held that there was no concluded contract and that though the plaintiff was ready and willing to deliver the said equipment on payment of balance amount, the defendant did not pay the said balance amount despite receipt of notice. The Trial Court, therefore, held that the plaintiff is entitled to recover the balance amount from the defendant.
10. The First Appellate Court, upon consideration of the judgment of the Trial Court and upon hearing the parties, maintained the findings of the Trial Court and dismissed the appeal.
11. It is against this judgment and order of the First Appellate Court that the present Second Appeal has been preferred by the defendant, which has been admitted on the following substantial questions of law:
a) Whether the courts below have converted the suit of the respondent which was a simple suit for recovery of money into a suit for specific performance of the contract and whether such an exercise was impermissible?
b) Whether the respondent could be said to be unpaid seller within the meaning of Section 45 of the Sale of Goods Act 1930 and whether the conclusion drawn by the learned trial Judge that the respondent was an unpaid seller and that the property in the computer system had passed on to the appellant, drawn with the aid of Section 20 of the Sale of Goods Act is perverse?
12. Mr. S. D. Lotlikar, learned Senior Counsel, on behalf of the defendant, after reading some averments made in the plaint and the prayer therein, submitted that according to the plaintiff, the defendant had agreed to purchase the computer and had paid certain amount and that he was ready and willing to perform his part of the contract. He urged that in spite of the above, the prayer is only for recovery of money with no prayer for specific performance. Learned Counsel, therefore, argued that the suit which was only for recovery of money has been converted by the Courts below into a suit for specific performance of the contract, which exercise, according to him is not permissible. After taking me through the correspondence on record, he contended that there is nothing to establish that the plaintiff had procured the computer system. He submitted that the plaintiff without acting in terms of the communication dated 02/02/90 (Exhibit 14), wants the balance amount, without giving the computer system to the defendant. He also contended that there is no evidence to establish that the plaintiff had presented the documents to the State Bank of India. He argued that in a suit for specific performance of a movable property presumption is that specific performance will not be granted. According to him, the plaintiff could not have filed suit for recovery of price of goods, but had to file suit for damages and in order to succeed, had to prove the loss sustained. According to Mr. Lotlikar, learned senior counsel, the damages are not quantified. Learned counsel for the defendant argued that the evidence on record duly proves that the intention of the parties was for passing of the property after payment of 100% advance, but vide the letter dated 8/12/1989 which is at Exhibit 12, the plaintiff had changed the stand by saying that it was a condition precedent that 100% advance was to accompany the order.
13. In so far as the judgment of the First Appellate Court is concerned, learned Senior Counsel, for the defendant, contended that there is absolutely no pleading in the plaint to say that the plaintiff is unpaid seller. He read Section 19 of the Sale of Goods Act, 1930 (henceforth referred to as “said Act”) and argued that the same pertains to the sale of specific or ascertained goods. According to him, since the goods were not received in the present case, the same cannot be called as specific or ascertained goods. He pointed out from the plaint that there is no averment that the plaintiff had received the computer system. He argued that the fact that the plaintiff had ordered the computer system and had received the same is something which is exclusively within the knowledge of the plaintiff and, therefore, it was for him to prove the same strictly. According to learned Senior Counsel, Section 55 of the said Act would be applicable and the plaintiff had to ask for damages for non-acceptance. He contended that Section 20 of the said Act is not at all applicable since the same presupposes that property is available for delivery. Learned Senior Counsel therefore urged that the substantial questions of law should be answered in the affirmative and the Second Appeal should be allowed.
14. Per contra, Shri Sudesh Usgaonkar, learned counsel for the plaintiff, invited my attention to the pleadings and argued that the plaintiff had not filed the suit for specific performance of the contract, but had filed suit for recovery of the price of the said computer system. He pointed out that averments made in paragraph 5 of the plaint reveals that the plaintiff has filed the suit for recovery of the balance amount of the sale price that is Rs. 49,596.30 paise with interest. He submitted that unpaid seller is defined under Section 45 of the said Act and the rights of unpaid seller are enumerated in Section 46 thereof. Learned counsel for the defendant argued that the suit is filed under Section 55 of the said Act. According to him, therefore, the first substantial question of law gets answered in the negative. Mr. Usgaonkar, then, read out the relevant portions of judgments of the lower Courts and argued that on the pleas taken in the plaint and in the written statement, both the Courts below have held that there was a concluded contract. Therefore, according to him, all submissions on contract are not open for any submissions. He also argued that though the plaintiff had prayed only for recovery of the balance price, however, the trial Court directed the plaintiff to do something more, that is, to supply the computer equipment to the defendant as per the purchase order dated 17/11/1989. According to Shri Usgaonkar, on account of the same the plaintiff is at loss but he does not mind. Relying upon Section 58 of the said Act, he argued that even otherwise specific performance is not foreign under this Act. He also contended that granting of relief without there being a prayer is open to the Court. He invited my attention to the written statement wherein the only objection to the suit is regarding the cause of action. He pointed out that there is no objection to the maintainability of the suit on the ground that the same is only for recovery of money. According to Shri Usgaonkar, learned counsel for the plaintiff, the second substantial question does not arise at all. He took me through the purchase order which is at page 82 of the paper book wherein each and every description about the equipment to be supplied to the plaintiff has been stated and all the terms and conditions are also stated and the price is also mentioned. He, therefore, argued that the goods to be supplied were ascertained goods since the plaintiff knew the existence of goods. He argued that the said item was procured as the defendant had ordered for the same and that it was not an item lying in the shelf to be picked up from amongst several items. He argued that the basic elements of Section 55 of the said Act are fulfilled. He pointed out that no counter claim has been filed by the defendant for damages on account of non-delivery of the said equipment. From the correspondence on record, Mr. Usgaonkar showed that the defendant had offered the plaintiff to sell to the defendant the said equipment at a reduced price or to sell to her another superior computer at the same price. According to learned counsel, the purchase order dated 17/11/1989 which asks the plaintiff to supply particular equipment, itself, goes to prove that the said equipment is ascertained goods. According to Shri Usgaonkar, the concept of passing of the property in the goods to the buyer as mentioned in Section 20 of the Sale of Goods Act is “abstract” and not “de facto”. He also argued that the rights of the unpaid seller mentioned in Section 46 of the said Act are not in derogation of Section 55 but are in addition to the same. He contended that 100% payment was asked for not to conclude the contract, but for delivery of goods. He pointed out from the evidence on record, more particularly the cross-examination of DW.1, that the defendant does not produce document of sanction of loan and that in fact no arrangements were made for payment of the balance amount. He further pointed out that the defendant did not even go to the bank to check whether the documents were sent by the plaintiff. Learned Counsel urged that each and every point that has been raised before this Court has been answered by the First Appellate Court. Mr. Usgaonkar argued that concurrent findings of fact cannot be disturbed in the Second Appeal, even if they are erroneous. He has relied upon the following citations: (1) MarutiBalwant Pawar vs. Mahatma Phule Agricultural University [2009 (3) Mh.L.J. 846); (2) KeharSingh v. Yash Pal and others (AIR 1990 S.C. 2212)); and (3) GurdevKaur and Ors. v. Kaki and Ors (AIR 2006 S.C. 1975).
15. I have gone through the entire material on record.
16. I find that there is absolutely no substance in the contention of the defendant that the Court's below have converted the suit of the plaintiff which was a simple suit for recovery of money into a suit for specific performance of the contract. A bare perusal of the averments made in the plaint reveal that the suit is of recovery of the price. Section 55 of the said Act provides as under:
“55. Suit for price. - (1) Where under a contract of sale the property in the goods has passed to the buyer and the buyer wrongfully neglects or refuses to pay for the goods according to the terms of the contract, the seller may sue him for the price of the goods.
(2) Where under a contract of sale the price is payable on a day certain irrespective of delivery and the buyer wrongfully neglects or refuses to pay such price, the seller may sue him for the price although the property in the goods has not passed and the goods have not been appropriated to the contract.”
Section 45 of the said Act defines unpaid seller as follows :
“ 45. " Unpaid seller" defined.-
(1) The seller of goods is deemed to be an" unpaid seller" within the meaning of this Act-
(a) when the whole of the price has not been paid or tendered;
(b) whena bill of exchange or other negotiable instrument has been received as conditional payment, and the condition on which it was received has not been fulfilled by reason of the dishonour of the instrument or otherwise.
(2) In this Chapter, the term" seller" includes any person who is in the position of a seller, as, for instance, an agent of the seller to whom the bill of lading has been indorsed, or a consignor or agent who has himself paid, or is directly responsible for, the price.”
The rights of an unpaid seller are stated in section 46 of the said Act as follows :
“46. Unpaid seller' s rights.-
(1) Subject to the provisions of this Act and of any law for the time being in force, notwithstanding that the property in the goods may have passed to the buyer, the unpaid seller of goods, as such, has by implication of law-
(a) a lien on the goods for the price while he is in possession of them;
(b) in case of the insolvency of the buyer a right of stopping the goods in transit after he has parted with the possession of them;
(c) aright of re- sale as limited by this Act.”
17. Merely because in paragraph 4 of the plaint the plaintiff has stated that he has always been willing and is still ready to deliver the said equipment to the defendant on payment of the balance purchase price that does not mean that the suit is one for specific performance of the contract. That only means that the plaintiff did not want to exercise his right under section 46 of the said Act, but wanted to sue for price of the said equipment. In fact, on account of the said willingness of the plaintiff, the Trial Court thought it proper to direct the plaintiff to deliver to the defendant the said computer equipment as per the purchase order dated 17/11/1989. Section 55 of the said Act should be read along with Section 45 of the said Act. As has been rightly contended by learned counsel for the plaintiff, the submission that there was no concluded contract is not available to the defendant, in the present second appeal since the said finding of the lower courts has not at all been challenged and there is no substantial question of law framed in this regard. As per section 18 of the said Act, where there is a contract for the sale of unascertained goods, no property in the goods is transferred to the buyer unless and until the goods are ascertained. In the present case, however, the goods are ascertained at the time of the contract itself. The purchase order dated 17/11/89, which is part of Exhibit 11-colly, reveals that specific equipments have been described for supply. The price agreed upon is also specifically stated. Section 55(1) of the said Act, stipulates passing of the property in the goods to the buyer under a contract of sale, and not actual delivery of the said goods. As has been held by the First Appellate Court, in terms of Section 20 of the said Act, where there is an unconditional contract for the sale of specific goods in a deliverable state, the property in the goods passes to the buyer when the contract is made, and it is immaterial whether the time of payment of the price or the time of delivery of the goods, or both, is postponed. Therefore, the term “passing of the property” stipulated under Section 55 of the Act is an abstract term and does not mean actual delivery of the goods. The correspondence on record in unambiguous terms establish that the defendant had placed the purchase order for a particular computer system and had paid Rs. 16,500/- as advance and had requested the plaintiff to forward the documents to her bank namely State Bank of India, Margao for recovery of balance of 75%. By letter dated 8/12/89, the plaintiff informed the defendant that as discussed earlier, they require 100% advance to be accompanied with the order and requested the defendant to remit the said balance of Rs. 49,596.30 paise. The plaintiff enclosed the proforma invoice No. 32 dated 8/12/89 with this letter and stated that the computer equipment of the defendant should be received shortly. Thus, the plaintiff, prior to 8/12/89, had already placed order with his principal for supply of the said goods. Again, by letter dated 12/1/90, the plaintiff wrote to the defendant to arrange to remit the balance amount of Rs. 49,596.30 paise to him so as to enable him to effect supply of the computer system required by the defendant. Admittedly, the defendant did not reply the above two letters. Finally, by letter dated 02/02/90 (Exhibit 14), the plaintiff informed the defendant that as referred to in the purchase order, he submitted the documents to the State Bank of India, Margao to recover the balance amount vide invoice No. 32 dated 8/12/89, but it was learnt that due to non-compliance of certain formalities at the Bank, sanction was not approved. By this letter, the plaintiff, informed the defendant that the computer system has arrived and is lying in the stores of the plaintiff since last three weeks but the defendant has not paid to him the balance amount so as to enable the plaintiff to deliver the computer. However, the plaintiff could not recover the balance amount from the bank of the defendant since the defendant had not complied with the formalities of the bank. The said notice dated 02/02/1990 which is at Exhibit 14 reveals that in terms of the purchase order, the plaintiff had procured the equipment. However, the defendant had not paid the balance amount nor had collected the computer system. By this letter, the defendant was called upon the pay the balance amount and complete the transaction. The expression “complete the transaction” as has been rightly argued by Mr. Usgaonkar, learned counsel for the plaintiff, cannot be taken to mean “conclude the contract”. The said expression has been used to inform the defendant to pay the balance amount and to take away the computer system.
18. It would be advantageous to quote the unnumbered paragraph 2 of the reply dated 16/2/1990, which is part of Exhibit 17-colly, which is as under:
“It cannot be denied by you that the aforesaid amount was paid to you on 17th November, 1989 while placing the order for supply of HCL Computer make PC/XT and EPSON FX-105 Printer. However, at no time concluded contract i. e. commercially clear order was arrived at on account of non-payment of 100% advance towards value of the said computer system envisaged in your letter dated 8th December, 1989; thereby entitling the parties to cancel the order at their option. Subsequently, however, under letter dated 30th January, 1990; my client offered to but the said computer system or HCL Computer PC-AT with 40 MB hard disc and MSP 45 Printer in the alternative with adjustment of aforesaid sum of Rs. 16,500.00 towards the prevalent decreased price of either system. You were also given notice to inform your concurrence to either of the proposals by 10th February, 1990 or to refund the said amount of Rs. 16,500.00 forthwith, putting an end to the entire matter.”
19. From the above letter, it is evident that the defendant does not dispute that the computer system ordered by her had already arrived. It can be understood from the above reply that the defendant was not ready to go ahead with the said transaction mainly on the ground that the price of the computer had decreased. The defendant had offered to buy the said computer system at a lower price or in the alternative for adjustment of the said sum of Rs. 16,500/- towards procuring a superior system. This letter does not show that the defendant had complied with the necessary formalities for sanction of loan. What transpires from the contents of this letter is that the defendant wanted to wriggle out of this contract, for reasons mentioned in the letter. The plaintiff was, therefore, entitled to the balance price of the said equipments agreed to be purchased by the defendant, and which were already procured by the plaintiff. Merely because the lower courts have further directed the plaintiff to supply the computer equipments to the defendant as per the purchase order dated 17/11/89, upon receipt of the said money, that does not make the relief to be of specific performance of the contract.
20. In view of the above, the First Appellate Court cannot be said to have erred in holding that the plaintiff was an “unpaid seller” in terms of section 45 of the said Act and was entitled to recover the price of the said equipments, in terms of section 55 of the said Act. I hold that the Court's below cannot be said to have converted the suit for recovery of money into a suit for specific performance of the contract. Both the substantial questions of law are therefore are answered in the negative.
21. The Second Appeal therefore is without any merit and hence is liable to be dismissed. The citations relied upon by Mr. Usgaonkar, the learned Counsel for the plaintiff, are on the point of scope of substantial question of law; concurrent findings by Trial Court and First Appellate Court and the scope of interference with the findings of facts, in Second Appeal. There is no quarrel about the principles laid down in the said citations. They are well known.
22. In the result, the appeal is dismissed, however, with no order as to costs.