dedol-hf/india-case-legal-rag huggingface dataset:
that  they are entitled to their commission when  they  have
found a purchaser, even though the negotiations are conduct-
ed and concluded by the principal himself;  and  also  where
there is a failure to complete the sale in consequence of  a
defect in title and no fault on the part of the brokers."
    In  my judgment therefore, Gentle J. was right  when  he
held  on  the interpretation placed by him on  the  document
that  the plaintiff had earned his commission in full  inas-
much  as  he  had secured a buyer who was  ready,  able  and
willing to buy the property for Rs. 1,10,000.
    As I have indicated above, if the word "buyer" is to  be
construed  in a strict sense, then it must be held that  the
broker  had authority to secure a buyer of that type and  he
could only do so by making a binding
(1)  17 C.B. (N.S.) 733.
58
contract with him.  On the other hand, if the word is  taken
to mean a potential buyer, such a buyer having been secured,
the  agent  was  entitled to the commission  that  had  been
promised to him.
    It  is  now  convenient to consider the  case  of  Luxor
(Eastbourne)  Ltd. v. Cooper(1) in some detail because  cer-
tain observations made by Lord Russell of Killowen and  Lord
Romer  are  the basis of the decision of the  learned  Chief
Justice.   In this case no commission note was addressed  to
the  broker and the contract was not contained in any  docu-
ment.  Evidence in support of the commission  agreement  was
oral  and  its terms had to be deduced from  that  evidence.
Viscount Simon L.C., out of the materials from which express
contract had to be pieced together, reached the result  that
the bargain was this:
    "If  a party introduced by the respondent should buy the
cinemas for at least pound 1,85,000, each of the two  appel-
lants would pay to the respondent pound 5,000 on the comple-
tion of the sale."
    No such sale took place, and in those circumstances   it
was  held that there could be nothing due to the  respondent
on  the  terms of the express bargain.  It was  then  argued
that  since  the proposed purchasers introduced by  the  re-
spondent  were  and  remained willing and able  to  buy  the
properties  for the minimum price, while the appellants  did
not close with the offer, the appellants  were  liable   in.
damages  to  the respondent for breach of an implied term of
the  commission  contract.  In the statement  of  claim  the
implied  term was said to be that the appellants  would"  do
nothing to prevent the satisfactory completion of the trans-
action so as to deprive the respondent of the agreed commis-
sion."   The breach pleaded was the failure to complete  the
contract  of sale with the respondent's client and the  dis-
posal  of the subject-matter in another quarter.   The  Lord
Chancellor  was  of the opinion that the  suggested  implied
term was not necessary in this contract and it was  observed
that  in contracts made with commission agents there was  no
justification for introducing an implied term unless it  was
necessary to
(1) [1941] A.C. 108.
59
do so for the purpose of giving to the contract the business
effect which both parties  to it intended it should have.
    Lord  Russell of Killowen in his opinion said  that  the
only  right of the plaintiff was to receive  his  commission
out of the purchase moneys if and when received.  His  right
was  a  purely contingent right.  He stood .to earn  a  very
large  sum at comparatively small pains, taking the risk  of
either  side  withdrawing from the negotiations  before  any
binding  contract of sale and purchase was concluded, or  of
the contract for any reason not being carried to completion.
In this view of the case the action was bound to fail and no
occasion arose for pronouncing on the correctness or  other-
wise  of the view expressed by the Court of Appeal in  Trol-
lope  & Sons v. Martyn Brothers (1).  Then it was said  that
as the question of these commission contracts was  discussed
at great length, that furnished an excuse for stating brief-
ly  conclusions  which his Lordship's mind, free as  it  was
from the fetter of previous decisions, reached.  In  dealing
with the subject the following observations were made :--
    "I  can find no safe ground on which to base the  intro-
duction  of any such implied term. Implied terms, as we  all
know,  can  only be justified under the compulsion  of  some
necessity.  No  such compulsion or necessity exists in   the
case under consideration. The agent is promised a commission
if  he  introduces  a purchaser at a  specified  or  minimum
price.  The  owner is desirous of selling. The  chances  are
largely in favour of the deal going through, if a  purchaser
is  introduced.  The agent takes the risk in the hope  of  a
substantial  remuneration for comparatively small  exertion.
In  the case of the plaintiff his contract was made on  Sep-
tember  23, 1935; his client's offer was made on October  2,
1935.   A sum of I0,000 (the equivalent of the  remuneration
of a year's work by a Lord Chancellor) for work done  within
a period of eight or nine days is no mean reward, and is one
well   worth  a  risk.   There  is  no  lack   of   business
efficacy..in sUCh a contract, I even
(1) [1934] 2 K.B. 436.
60
though  the  principal  is free to refuse  to  sell  to  the
agent's client.
    The  position will no doubt be different if  the  matter
has proceeded to the stage of a binding contract having been
made between the principal and the agent's client.  In  that
case  it can be said with truth that a 'purchaser' has  been
introduced  by  the  agent; in other words,  the  event  has
happened  upon the occurrence of which a right to the  prom-
ised  commission has become vested in the agent.  From  that
moment  no act or omission by the principal can deprive  the
agent of that vested right."
    It  is the observations last quoted which are the  basis
of the decision of the learned Chief Justice in the  present
case.  It seems to me that these observations had  reference
to  cases  visualized  by Lord Russell of  Killowen  in  the
earlier  part of this quotation with specific  reference  to
the  facts found in that case and cannot apply to all  cases
where  the  word ' purchaser ' or 'buyer' has  been  loosely
used in a different context.
    Lord  Romer in his opinion made the  following  observa-
tions :-
    "But  supposing  that a contract by one  person  to  pay
another a sum of money in the event of the latter performing
an  unsolicited service to the former is as much subject  to
an  implied condition as if the latter had been employed  to
perform  the service, the condition is in general  one  that
merely  imposes on the former a negative and not a  positive
obligation.   If I employ a man for reward to build a  house
on  my land I subject myself to an implied condition that  I
will do nothing to prevent him carrying out the work.  But I
am  under no implied obligation to help him earn the  reward
whether  by the supply of building materials  or  otherwise.
But  there  are  exceptional cases where in  a  contract  of
employment the employer is under a positive obligation.  If,
for  instance,  I employ an artist to paint  my  portrait  I
subject myself to the positive obligation of giving him  the
requisite  sittings.  The question, then, to  be  determined
upon the hypothesis that I mentioned just now is this: Where
an owner of
61
property  employs an agent to find a purchaser,  which  must
mean at least a person who enters into a binding contract to
purchase,  is it an implied term of the contract  of  agency
that, after the agent has introduced a person who is  ready,
willing  and able to purchase at a price assented to by  the
principal,  the principal shall enter into a  contract  with
that person to sell at the agreed price subject only to  the
qualification  that  he may refuse to do so if he  has  just
cause or reasonable excuse for his refusal ? This qualifica-
tion  must  plainly be added, for the  respondent  does  not
contend,  and  no one could successfully contend,  that  the
obligation  of the principal to enter into a contract is  an
unconditional one."
The  learned Chief Justice relying on the last  part  of
the  above  quotation  reached the conclusion  that  in  the
present  case as the duty of the agent was to secure a  pur-
chaser,  it  could not be held that the purchaser  had  been
secured  till  the  contract of sale was  concluded  by  the
vendor  with him and that the actual sale having  been  con-
cluded  for a sum of Rs. 1,05,000, the plaintiff could  only
get his remuneration on the basis of the price for which the
sale  was made and not on the basis of the offer the  plain-
tiff  had secured.  It seems to me that when Lord Romer  was
laying  down  that a purchaser in such  contracts  means  at
least  a person who enters into a binding contract  to  pur-
chase, he had in mind the contract with which he was dealing
in that case. I am free to think that Lord Romer had not  in
mind commission notes wherein the word "buyer" or  "purchas-
er" had been employed in a loose sense.
In Jones v. Lowe(1), wherein the instrument was in these
terms--
    "In  the  event of my introducing a purchaser,  I  shall
look  to  you  for the payment of the  usual  commission  in
accordance  with  the  scale fixed by  the  Auctioneers  and
Estate Agents Institute ",
    Hilbery  J. said that had he been free of authority,  he
should  have  thought  that there were  strong  grounds  for
saying that what every owner of a house who desired to
(1) [1945] 1 K.B. 73.
62
sell  it  expected  a house agent to do, was  to  bring  the
property fairly to the notice of persons who resorted to him
for houses and endeavour to persuade one of them to buy  it.
The learned Judge further observed as follows :--
    "If the agent introduces someone who is perfectly  will-
ing  to go through with the purchase at a price  which  will
satisfy  the vendor, it would seem that the agent  has  done
everything  that the parties contemplate that he should  do,
for  they  do  not contemplate that the  agent  should  have
anything  to do with the actual completion of  the  transac-
tion.   He is to find a person who will pay the price  which
is asked for the property, and the contract is entered  into
on the basis that the person so found will be the person  to
whom the owner of the property will sell.
    It  seems to me hard, if an agent has done to  the  full
extent what the parties contemplated that he should do, that
he  should not be entitled to say ' I have done what I  con-
tracted  to do because I have introduced someone willing  to
purchase  although he never in fact became the. actual  pur-
chaser'.   I do not feel, however, that it is open to me  to
put  that construction on the words of the contract  in  the
present  case because I think that the observations made  in
the  House of Lords, and particularly those of Lord  Russell
of  Killowen  and Lord Romer in Luxor (Eastbourne)  Ltd.  v.
Cooper  (1), show that they were clearly of opinion that  if
an  agent is employed to introduce a purchaser for  a  house
and  before  the purchaser has entered into  a  binding  and
legal contract, the house is withdrawn from the market,  the
agent cannot say that he has earned his commission."
    In  a later case, E.H. Bennett v. Millet (2),  the  same
learned Judge had to deal with a case where the contract was
in these terms :--
    "We  confirm  that  in the event of  our  introducing  a
purchaser  who is able and willing to complete the  transac-
tion,  our commission will be in accordance with the  recog-
nized scale...".
    The plaintiffs introduced a prospective purchaser,  Whom
the court found to have been at all times able
(1) [1941] A.C. 108.        (2) (1948) 2 All. E.R. 929.
63
and  willing to purchase, but the defendant refused to  com-
plete.   It was argued by the defendant that the  qualifica-
tion  of the word "purchaser" in the plaintiffs' letter  was
otiose and therefore should be struck out and the plaintiffs
had  not performed the contract until they had introduced  a
person  who actually. completed the purchase.  It  was  held
that the expression "a purchaser who is able and willing  to
complete  the  transaction" meant not a person who  did,  in
fact,  ultimately  purchase the property, but  one  who  was
prepared  to purchase it at the seller's price, and, as  the
estate agents had found such a person, they were entitled to
their commission.  The learned Judge further stated that  in
ordinary  parlance  we do not use the  word  "purchaser"  as
necessarily restricted to a person who actually completes  a
transaction  of purchase and sale.  In my  judgment,  there-
fore,  on  the  alternative interpretation  which  has  been
placed  by the two courts below on the commission  note  the
word "purchaser" cannot be read in the strict sense in which
it  was read in Luxor's case (1), but should be read in  the
sense  in which it is loosely used in common  parlance,  and
that  being  so, the decision under appeal  cannot  be  sus-
tained.
Mr. Setalvad cited a number of Indian authorities  where
the  words  "buyer" and "purchaser" had not been  given  the
strict  meaning  that had been given in  Luxor's  case  (1).
Similarly, the words "lender" and "borrower" had been  given
the meaning of "potential lender" and "potential  borrower".
It  is, however, unnecessary to enter into a  discussion  of
all those cases as it does not in any way advance the matter
beyond  what I have already said.  It is unnecessary  to  go
into  the  third contention of Mr. Setalvad in view  of  the
above decision.
    For the reasons given above I agree with the  conclusion
reached  by  my brother, Patanjali Sastri, in  the  judgment
just delivered by him, that the appeal be allowed with costs
throughout.
                         Appeal allowed.
Agent for the appellant: S.P. Varma.
Agent for the respondent: Sukumar Ghose.
(1) [1941] A.C. 108.
9
64
PETITIONER:
BHAWANIPORE BANKING CORPORA-TION, LTD.
        Vs.
RESPONDENT:
GOURI SHANKAR SHARMA
DATE OF JUDGMENT:
14/03/1950
BENCH:
FAZAL ALI, SAIYID
BENCH:
FAZAL ALI, SAIYID
KANIA, HIRALAL J. (CJ)
SASTRI, M. PATANJALI
MAHAJAN, MEHR CHAND
DAS, SUDHI RANJAN
CITATION:
 1950 AIR    6            1950 SCR   25
 CITATOR INFO :
 R          1974 SC 968  (9,44,49)
ACT:
    Limitation  Act  (IX of .1908), .Art. 182,  cls.  2  and
3'Execution  of decree--Limitation--Starting point--'  Where
there  has been a review ", meaning of--Application for  re-
opening  decree under s. 86, Bengal Money-lenders  Act  dis-
missed  for  default and appeal from  order  of  dismissal--
Whether give fresh starting for limitation for execution  of
decree--Interpretation of Art. 189, cls. 2 and 3.
HEADNOTE:
  A preliminary decree on a mortgage was passed ex parte  on
the 21st August, 1940. The judgments debtor made an applica-
tion  under  s. 36 of the Bengal Money-lenders Act  for  re-
opening the
26
decree  and  the application wins dismissed for  default  of
appearance  on the 20th December, 1941, and  an  application
under O. IX, r. 9 C.P.C. for restoration of this application
was also dismissed on the 1st June, 1942.  In the  meanwhile
on the 22nd December, 1941, a final decree was passed.   The
judgment-debtor preferred an appeal from the order  dismiss-
ing  his  application under O. IX, r. 9,  C.P.C.,  and  this
appeal  was dismissed for non-prosecution on the  3rd  July,
1944.  On the 9th April, 1945, the decree holder applied for
execution of the decree:
   Held that, even assuming that the word "review" has  been
Used  in Art. 182 of the Indian Limitation Act, 1908,  in  a
wide  sense  and  that the application under s.  36  of  the
Bengal Money lenders Act was an application for review,  cl.
3 of Art. 182 was not applicable to the case inasmuch as the
application  under. s. 36 having been dismissed for  default
the court had no occasion to apply its mind to the  question
whether the decree could or should be re-opened and it could
not. therefore be said that "there has been a review" of the
decree within the meaning of the said clause.Held also, that
the  words "where there has been an appeal " in cl.2 of  Art
182  must  be read with the words "for  the execution  of  a
decree  or order" in the 1st column of the Article  and  the
fact that there was an appeal from the order dismissing  the
application  under O. IX, r. 9, made in connection with  the
proceeding  under  s.  36 of Money-lenders  Act,  could  not
therefore  give  fresh starting point for  limitation  under
Art. 182, cl. 2,.
JUDGMENT:
        Appeal from the High Court of Judicature at  Calcut-
ta: Civil Appeal No. LI of 1949.
Manohar Lal, (H.K. Mitter with him), for the appellant.
B.C. Mitter, for the respondent.
     1950.  March 14.  The judgment of the Court was  deliv-
ered by
     FAZL  ALI J.---The only question to be decided in  this
appeal,  which  arises out of an  execution  proceeding,  is
whether the decree under execution is barred by  limitation.
The first court held that the decree was not barred, but the
High  Court  has come to the opposite  conclusion,  and  the
decree-holder  has,  after  obtaining  a  certificate  under
Section  110 of the Civil Procedure Code, appealed  to  this
Court.
     The  facts  may be briefly stated as follows.   On  the
21st August, 1940, a preliminary mortgage decree was
27
passed  ex  parte in a suit instituted by the  appellant  to
enforce a mortgage.  On the 19th September, 1940, the  judg-
ment-debtor   made an  application under Order IX, rule  13,
of  the Civil Procedure Code for setting aside the ex  parte
decree,  but this application was rejected on the 7th  June,
1941.  On the 11th July, 1941, the judgment-debtor filed  an
application  under  Section a6 of the Bengal  Money  lenders
Act, for reopening the preliminary decree, but this applica-
tion  was  dismissed for default of appearance on  the  20th
December,  1941.   Thereafter, a final mortgage  decree  was
passed  in  favour of the appellant, on the  22nd  December.
The judgment-debtor then made an application under Order IX,
rule  9, of the Civil Procedure Code for the restoration  of
the  proceedings under Section 36 of the Money lenders  Act.
The  application.  was however dismissed on the 1  st  June,
1942,  both on the ground that no sufficient cause  for  the
nonappearance of the applicant and his failure to take steps
in  the  proceedings  was shown and on the  ground  that  no
purpose would be served by reopening the preliminary  decree
after the final decree had been passed.  The judgment-debtor
thereafter preferred an appeal to the High Court at Calcutta
from the decision dismissing his application under Order IX,
rule 9, but the appeal was dismissed for non-prosecution, on
the  3rd July, 1944.  On the 9th April, 1945, the  appellant
filed  an application for executing the decree  against  the
original judgment-debtor, though he had died previously, and
this application was dismissed for default on the 11th  May,
1945.   On the 2nd June, 1945, the present  application  for
execution  was  filed,  and the question which  we  have  to
decide is whether this application is in time.
    It  is  quite clear that the application  for  execution
having been made more than three years after the date of the
final  decree, it must be held to be timebarred, unless,  as
has  been contended before us, the case falls  under  either
clause 2 or clause 3 of article 182 of the Indian Limitation
Act.  'Under  these clauses, time to  make  the  application
begins to run from--
28
"2.  (Where  there has been an appeal) the  date  of  the
final  decree or order of the appellate Court, or the  with-
drawal of the appeal, or
  3. (Where there has been a review of judgment)the date  of
the decision passed on the review..."
It is contended that the case is covered by clause 3,and the
ground  urged  in  support of this contention  is  that  the
application  made by the judgment-debtor for  reopening  the
preliminary  mortgage decree under Section 36 of the  Money-
lenders  Act must be regarded as an application  for  review
and  time should be held to run from the date of  the  final
order passed in the proceedings connected with that applica-
tion.  In our opinion, there is no substance in this conten-
tion.    The  important words in  clause 3 of  article   182
are:(1)   "where   there  has  been  a   review"   and   (2)
"the   decision  passed  on  the  review  ".   These   words
show  that  before  a  case can  be  brought  under  article
182,clause  8, it must be shown firstly that the  court  had
undertaken  to review the relevant decree or order and  sec-
ondly,  that there has been a decision.on.the review.In  the
present  case, even if it be assumed that the word  "review'
has  been used in article 182 in a large sense and that  the
application for reopening the decree under Section 36 of the
Bengal Money lenders Act was an application for review,  the
appellant cannot succeed, because the court never  undertook
or purported to review the decree in question.  What actual-
ly  happened was that the application under Section  a6  for
reopening the preliminary decree (not the final decree which
is  the  decree  sought to be executed)  was  dismissed  for
default  and the application under Order IX, rule 9,  of.the
Civil Procedure Code for the restoration of the  proceedings
under  Section  86 of the Money lenders Act  was  also  dis-
missed.  Even if the fact that the judgment-debtor's  appli-
cation under Section 36 was directed against the preliminary
mortgage decree is overlooked, that application having  been
dismissed for default, the court never had occasion to apply
its  mind to the question as to whether the decree could  or
should  be  reopened,  and hence it cannot be  said  that  '
'there ha8 been a review" of the
29
decree.  The proceedings under Order II, rule 9, of the Code
of  Civil Procedure are not material to the present  discus-
sion,  because they did not involve a review of  the  decree
under  execution but a review, if it is at all  possible  to
call it a review, (which, in our opinion, it is not), of the
order  dismissing  the judgment debtor's  application  under
Section 36 for default.
    It  was  also suggested by the learned counsel  for  the
appellant  that  the  case might be held to  be  covered  by
clause  2 of article 182 on the ground that, even though  no
appeal  was  preferred from the final mortgage  decree,  the
words  "where  there has been an appeal"  are  comprehensive
enough  to  include in this case the appeal from  the  order
dismissing  the application under Order IX, rule 9,  of  the
Civil  Procedure Code, made in connection with the  proceed-
ings  under Section 36 of the Moneylenders Act.  This  argu-
ment  also is a highly far-fetched one, because the  expres-
sion "where there has been an appeal" must be read with  the
words  in column 1 of article 182, viz., "for the  execution
of  a  decree or order of any civil Court  ......   ",  and,
however  broadly  we may construe it, it cannot be  held  to
cover an appeal from an order which is passed in a collater-
al proceeding  or which  has  no direct or immediate connec-
tion with the decree under execution.
    In  our view, this appeal has no substance, and  we  ac-
cordingly dismiss it with costs.
                                          Appeal dismissed.
Agent for the appellant: P.K. Chatterji.
Agent for the respondent: R.R. Biswas.
30
PETITIONER:
COMMISSIONER OF INCOME-TAX,WEST BENGAL
        Vs.
RESPONDENT:
CALCUTTA AGENCY LTD.
DATE OF JUDGMENT:
21/12/1950
BENCH:
KANIA, HIRALAL J. (CJ)
BENCH:
KANIA, HIRALAL J. (CJ)
SASTRI, M. PATANJALI
DAS, SUDHI RANJAN
CITATION:
 1951 AIR  108            1950 SCR 1008
 CITATOR INFO :
 D          1965 SC1905  (6)
 R          1976 SC 772  (6)
ACT:
lndian  Income-tax  Act  (XI  of 1922),  ss.  10  (2)  (xv),