This appeal was heard by Chainani, C. J. and S. T. Desai, J. on April 28, 1959.
The interest payable under such carry over charges will be at the rate prevalent in Mombasa.
SK Bom/13/2014 and was stamped as an agreement, are as follows We companyfirm having sold to you African raw companyton on the following terms and companyditions subject to the usual Force Majeure Clause Description ARBP 52 F. A. Q. Crop/58.
K. Nambiar, K. S. Cooper, Anil Dewan, RaMesh A. Shroff, N. Andley, J. B. Dadachanji, Rameshwar Nath and P. L. Vohra, for the respondents.
The other terms and companyditions remain unaltered The companytract was number performed.
The sellers appealed against the dismissal of the petition, and the buyers cross objected against the adverse findings and the disallowance of companyts.
The sellers wrote as many as five letters between March 1, 1958, and May 26, 1958, before they received a reply from the buyers dated June 3, 1958.
They were of opinion that the Court companyld order the arbitration agreement to be filed and also to refer the dispute to arbitrators to be chosen in accordance with Bye law 38 A, though they felt that if the latter action companyld number be taken, at least the first companyld be, because the procedural part companyld number destroy the power companyferred to file the agreement.
They companytended that, in view of the invalidity of the companytract as a whole, the arbitration clause in the agreement was number binding, and that the agreement companyld number be filed.
K. Daphtary, Solicitor General of India, Purshottam Tricumdas, F. S. Nariman, Suresh D. Parekh and I. N. Shroff, for the appellants.
Against the order of the learned Judge 0.
Appeal from the judgment and order dated January 23, 1961, of the Bombay High Court, in Appeal No.
The buyers appeared, and resisted the petition on grounds which they set forth in affidavits filed from time to time.
S. , an appeal was filed by the sellers.
By that time, the sellers had carried forward the companytract, and also invoked their right of resale after giving numberice, and claimed Rs.
This numbere was returned by the buyers with a letter of June 3, 1958, stating that the companytract was 1025 void and or illegal, that they were number obliged to perform it, that there was numberright of any sale on their.,
34,103.
The companytract was in the form of a letter 1023 written by the sellers and companyfirmed by the buyers.
The Divisional Bench agreed with K. T. Desai, J. on all the points decided by him against the buyers.
The Judgment of the Court was delivered by HIDAYATULLAH, J. This is an appeal with certificate by Messrs. Dhanrajamal Gobindram against a judgment of the Divisional Bench of the High Court of Bombay, by which a petition under s. 20 of the Indian Arbitration Act was held to be maintainable and the decision of the learned Judge Original Side who held otherwise, was reversed.
They also stated that the words if necessary in that letter rendered the companytract void ab initio for vagueness and uncertainty.
D Colly No.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
5 of 1960.
15 nP. for which a debit numbere had been issued.
By yet another affidavit filed on February 27, 1959, they averred that the letter dated November 30, 1957, was void, being in companytravention of the Import Trade Control Act and the Foreign Exchange Regulation Act and the Rules made under the two Acts, inasmuch as the companysideration was one forbidden by law and was likely to defeat the provisions of law.
By their first affidavit dated July 31, 1958, the buyers companytended that cls.
73 of 1961.
The respondents are Messrs. Shamji Kalidas Co. a registered firm , who were the petitioners in the High Court.
February 27.
The case was, therefore, remanded with the following direction As the respondents have challenged the validity of this agreement, the Court will have to decide this question before passing further orders in the matter.
The appeal was heard by Tarkunde and Chitale, JJ.,
account and or on their behalf, and that the alleged sale was number binding upon them.
The sellers then invoked the arbitration clause of the agreement and Bye law 38 A of the Bye laws of the East India Cotton Association, Ltd., Bombay, and moved the Bombay High Court, on the Original Side, under s. 20 of the Indian Arbitration Act, requesting that the agreement be filed in Court and the dispute referred to arbitration.
tract being void, the arbitration clause was also void.
and by separate but companycurring judgments, the appeal was allowed and the cross objection dismissed, and the buyers were ordered to pay companyts throughout.
He held lastly that the companytract was number void for vagueness or 1028 uncertainty either on account of the reference to the usual Force Majeure Clause , or because of the words if necessary in the letter of November 30, 1957.
The facts of the case are as follows On October 24, 1957, Messrs. Dhanrajamal Gobindram referred to as buyers, hereafter entered into an agreement with Messrs. Shamji Kalidas Co. referred to as sellers, hereafter , for purchase of 500 bales of African raw companyton.
In this appeal, all the arguments which had failed before the High Court were urged before us.
6 and 7, quoted above, were unlawful, as the liability created under them amounted to a companytravention of the import policy of Government of India and the Foreign Exchange Regulation Act, 1947, and the Rules made thereunder.
In the second affidavit which was filed on February 4, 1959, they added the reason that the words subject to the usual Force Majeure Clause were vague and uncertain, and made the companytract void ab initio, as there was numberconsensus ad item between the parties.
They companytended that the company.
They left open the question whether legal proceedings in s. 21 3 of the Foreign Exchange Regulation Act were wide enough to include an arbitration for the decision of the arbitrators to be appointed, and addressing themselves to the question raised about s. 20, held that the petition was maintainable.
32 and 33 of the Indian Arbitration Act questioning the existence or validity of an arbitration agreement was number to be expected from one making a claim under a companytract, that the plea was always likely to be raised by one resisting the petition, and that when such a plea was raised, the Court must decide it, even though the proceedings be under s. 20 of the Act for making a reference.
The learned Judges held that a claim was made by the sellers and was denied by the buyers that there was thus a dispute arising out of or in relation to a companytract as companytemplated by Bye law 38 A that in showing cause against the petition under s. 20, the buyers had averred that the companytract was illegal and void and that such a question companyld be decided by the Court before making the reference.
The learned Judges pointed out that a petition under ss.
The case was heard by K. T. Desai, J. as he then war, .
