Sen, J.

1. On 16th September 1943 the plaintiff firm entered into acontract with the defendant company for the purchase of one wagon of maizestarch at the rate of Rs. 77 per cwt. f. o r. Jagadhri. The maximum price thenfixed by the Government of India for the commodity was Rs. 78 per cwt. The goodswere loaded on railway wagons at Jagadhri on 27th December 1943 by thedefendant company. In the railway receipt the defendant company was theconsignee. On 3rd January 1944, the railway receipt was endorsed over to theplaintiff firm and the plaintiff paid the balance of the price of the goods onthat date. In the meantime, on 16th December 1943, a new order was passed bythe Government of India making Rs. 48 the maximum price. This order wasapplicable to all contracts in which delivery was to be given on or after 1stJanuary 1944. The plaintiff seeks to recover the difference between thecontract price of Rs. 77 per cwt. and the maximum price of Rs. 48 per cwt.fixed by the order of the Government of India. In the plaint, the allegationwas that the defendant company suppressed the fact that such an order had beenpassed and was guilty of misrepresentation. That charge is now abandoned. Theplaintiff firm also claimed that the defendant company could not charge morethan Rupees 47 per cwt., i.e., Re. 1 less than the maximum price. That claim isalso abandoned. The plaintiff now claims the difference between the contractprice and the price fixed by Government and the claim is based on the followingtwo grounds, viz.: (1) The contract having become void by reason of the newGovernment order, the defendant is bound to make compensation to the plaintiffor restore the advantage it has got under the contract. Sections 56 and 65,Contract Act, are relied upon for this branch of the argument. (2) The payment inexcess having been made by mistake the defendant is bound to refund it. Section72, Contract Act, is invoked in support of this contention.

2. The defendant companys defence is that delivery havingbeen given on 27th December 1943 when the goods were loaded on railway wagonsthe new order did not apply and therefore, no refund is payable. The secondline of defence is that even if it be held that excess payment had been made,it is not recoverable as it was made by reason of a mistake of law and not of fact.

3. The first question for determination is whether the neworder applies to this contract. If there was delivery on 27th December 1943then admittedly the order does not apply. If, however delivery be taken to havebeen made on 3rd January 1944 then, again admittedly, the order would apply.Mr. B. C. Ghose for the defendant argues that the contract being f. o. r.Jagadhri delivery took place as soon as the goods were loaded on the railwaywagons at Jagadhri in terms of the contract and he referred me to Ss. 2 (2), 23(2) and 39, Sale of Goods Act.

4. Section 2 (2) defines delivery as the voluntary transferof possession from one person to another. Certainly, possession was given tothe railway company on 27th December and there was delivery to the railwaycompany on that company on that date when the goods were loaded on the wagons.But we are concerned here with the question of delivery to the buyer. Can it besaid that such delivery to the railway amounted to delivery to the buyer Mr.Ghosh argues that it does, because delivery to a carrier for transmission tothe buyer is prima facie deemed to be delivery to the buyer. He refers to S. 39(1), Sale of Goods Act, which is in the following terms :

Where, in pursuance of a contract of sale, the seller isauthorised or required to send the goods to the buyer, delivery of the goods toa carrier, whether named by the buyer or not, for the purpose of transmissionto the buyer, or delivery of the goods to a wharfinger for safe custody isprima facie deemed to be a delivery of the goods to the buyer.

He meets the objection that the railway receipt was made outin the name of the defendant company as consignee by saying that this actmerely reserved to the consignor a right of disposal and that this reservationdid not prevent the delivery of the goods to the railway from amounting todelivery to the buyer. He refers to S. 25, Sale of Goods Act, and points outthat there may be delivery although the vendor retains a right of disposal. Onbehalf of the plaintiff, the argument is that as the defendant was theconsignee in the railway receipt it cannot be said that the goods were put onthe railway for transmission to the buyer.

5. There can be no doubt that there may be delivery to thebuyer even though the seller retained right of disposal in the goods delivered;but the mere putting of goods on the railway wagons does not necessarily amountto delivery to the buyer. The section says that the goods must be delivered tothe carrier for transmission to the buyer. The section further says that suchdelivery to the carrier would prima facie be deemed to be delivery to thebuyer; the use of the words prima facie shows that even if there be delivery tothe carrier for transmission to the buyer circumstances may exist which wouldprevent such delivery from amounting to delivery to the buyer. Here theconsignee was not the buyer but the seller. The goods were, therefore, beingtransmitted to the seller and not to the buyer. It cannot be said that therailway had been directed to carry the goods to the buyer and that the sellermerely retained some right of disposal. The railway was directed to deliver thegoods to the defendant company and not to the plaintiff firm. In such a casedelivery to the railway company cannot be deemed to be delivery to the buyer.The order passed under the Defence of India Act would, therefore, affect thiscontract. The next question for determination is whether the plaintiff canrecover the difference between the contract price and the price fixed by theGovernment order. I shall first consider the argument of the plaintiff which isbased on Ss. 56 and 65, Contract Act. It is argued that the contract becamevoid by reason of the provisions of S. 56. Section 56 so far as it relates tothe present question is as follows:

A contract to do an act which, after the contract is made,becomes impossible, or, by reason of some event which the promisor could notprevent, unlawful, becomes void when the act becomes impossible or unlawful.

6. Learned counsel for the plaintiff contends that thecontract between the parties became void when the order under the Defence ofIndia Act was passed making it unlawful for any one to charge a price exceedingthe price fixed by the order. He then contends that as the contract became voidthe defendant who has received an advantage under the contract in the way ofthe price for the goods in excess of what it was entitled to receive is boundto refund the excess. For this purpose he relies on S. 65.

7. Now did the contract become void on 16th December 1943,when the order was passed fixing the maximum price of the goods at Rs. 48 percwt. On that date it was made unlawful for any one to charge any price inexcess of Rs. 48 per cwt. inasmuch as the order provided that anyone chargingmore was liable to be imprisoned. It was argued on behalf of the defendant thatthe contract was not unlawful but that only a term of it was made unlawful andthat the contract could still be performed by the payment of the price fixed bythe order. I am not impressed by this argument. The main term of the contracthad become unlawful. The contract as entered into between the parties could notbe performed without infringing the law. Payment of a lesser sum than thatfixed by the contract would amount to the alteration of the contract in itsessential term and to the substitution of a new contract for the old one.Suppose the defendant company had refused to sell at the new reduced pricecould the plaintiff firm have forced it to sell In my opinion it could not.The order under the Defence of India Act does not contain any such compellingprovision; no statute has been shown to me under which the defendant could beso compelled, nor can such compulsion be supported on any principle of justiceor equity. The contract, as it stood, could not be performed without infringingthe law and it, therefore, became void on the date of the promulgation of theafore, (said order under the Defence of India Act. The next question is whetheron this account the plaintiff would be entitled to recover the differencebetween the contract price and the price fixed by the order by invoking the aidof S. 65 which is in the following terms:

When an agreement is discovered to be void, or when acontract becomes void, any person who has received any advantage under suchagreement or contract is bound to restore it, or to make compensation for it,to the person from whom he received it.

In my opinion, the answer must be in the negative. Section65 deals with two matters: (a) an agreement which is discovered to be void and(b) a contract which becomes void.

8. The first matter is concerned with an agreement whichnever amounted to a contract because it was void ab initio, the fact of itsbeing void being discovered at a later stage. The word used is"agreement" and not contract. I would also stress the use of the word"discovered" in the first part of the section in contradistinction tothe word "becomes" in the second part. The word "discover"connotes the pre-existence of that which is discovered. We are not concernedwith such a case. The second matter deals with a contract (i. e. with anagreement enforceable at law) which was good at its inception but which becomesvoid at some later stage by reason of some supervening circumstance. We areconcerned with such a case. Now what the section says is that if anybodyreceives any advantage under such a contract he is bound to restore it or makecompensation for it when the contract becomes void. The advantage must havebeen received under the contract. Now a contract is an agreement enforceable atlaw (see S. 2 (h), Contract Act). The advantage must, therefore, have beenreceived under an agreement enforceable at law. If the advantage is receivedafter the agreement ceases to be enforceable at law, i.e., ceases to be acontract, can it be said that it is an advantage received under the contract Ithink not. The section applies only if the advantage is received before thecontract ceases to be a contract by becoming void. In this case it was receivedafter and, therefore, the section does not apply. This view finds support inthe decision of the Bombay High Court: 44 Bom. 631 [LQ/BomHC/1919/83] Wolf & Sons v. Dadiba,Khimji & Co. (20) 7 A. I. R. 1920 Bom. 192 : 44 Bom. 631 [LQ/BomHC/1919/83] : 58 I. C. 465. Inext take up for consideration the argument that the sum claimed is recoverableunder S. 72, Contract Act, as having been paid under a mistake. Section 72 isas follows:

A person to whom money has been paid, or anything delivered,by mistake or under coercion must repay or return it.

9. On behalf of the defendant the argument is that S. 72contemplates only a mistake of fact and not one of law. It is said that if asum paid under a mistake of law be recoverable then the provisions of S. 21,Contract Act, would be rendered nugatory. Section 21 enacts that a contract isnot voidable because it was caused by a mistake as to any law in force inBritish India. The argument of the defendant, therefore, amounts to this: acontract is not voidable by reason of its being caused by a mistake of law,therefore, a payment made under a mistake of law must be irrevocable. Put thusit seems to me that this argument is not supported by logic. Section 72 usesthe word "mistake" without any qualification. Is there any justificationfor engrafting a qualification which is not in the Statute The basic rule inconstruing a statute is to give the words of it their ordinary grammaticalmeaning. One must not depart easily from this rule. I am not unmindful ofanother principle of construction, viz., that one must always endeavour to giveeffect to every part of a statute and adopt, whenever possible, a constructionwhich has this effect in preference to a construction which would render a partof the statute nugatory. Both these principles should be worked in harmony. Nowif the word mistake in S. 72 is given its ordinary meaning, viz., a mistake ofany kind - an unqualified mistake - does any conflict necessarily arise betweenthat section and S. 21 I think not Section 21 speaks not of a payment madeunder a mistake of law but of "a contract caused by a mistake oflaw." Section 72 does not speak of a contract at all but merely of apayment made under a mistake. The section appears in Chap. V, which does notdeal with contracts but "with certain relations resembling those createdby contract." As I read it, all that S. 72 says is this:

If a person makes a payment under a mistake (of law or offact) a relationship resembling a contract is created under which the personreceiving the payment is bound to return the money.

A payment may be made by mistake without there being anycontractual relationship at all between the parties. A may pay a sum to B underthe mistaken belief that he is in law bound to maintain B. Here there is nocontract between the parties voidable or otherwise. If the law declares such apayment refundable, it does not in any way conflict with S. 21 as no contractis involved. Again a payment may be made in the course of a contract under amistake of law without such payment being the "cause of thecontract." In such a case also, the refund of that payment would notrender S. 21 nugatory. That section deals only with mistakes of law which"cause a contract" or which give birth to a contract; it has nothingto do with any other kind of mistake. If, therefore, a payment made under amistake of law is not the origin of a contract such payment would be refundableunder S. 72. This is how I would construe S. 72. I think that a certain amountof confusion has been caused by reason of the importation of the English commonlaw rule regarding the recovery of payments made under a mistake. The Englishcommon law rule that a payment made under a mistake of law is not recoverablecan have no application here, where there is a statute governing the question.I would, therefore, respectfully disagree with the dictum of Lort-Williams J.,in 39 C. W. N. 174 Katherine Stiffles v. Carr Makertich Martin (35) 39 C. W.N. 174 at p. 185. This dictum is based on the assumption that the English Commonlaw doctrine regarding this subject is applicable to India.

10. The question remains whether in this case the plaintiffis entitled to recover the sum claimed. Can it be said that the differencebetween the contract price and the maximum price fixed by the Government orderrepresents a payment made by the plaintiff by mistake In my opinion itcannot; when the contract became void, the plaintiff could have refused to payanything at all and in that case he would have had to return the goods. If he paidthe contractual sum in ignorance of the fact that the contract had become voidthat would be a payment by mistake. He could then recover the entire amountpaid and return the goods. Here the entire contractual price has been paid bymistake. The plaintiff cannot be permitted to split up the payment made in theway he seeks to do and to treat a part only of such payment as being a paymentmade by mistake refundable under S. 72. To do so would be to permit theplaintiff to enforce a new contract on the defendant company. As I have pointedout before, the Government order contains no such compelling clause, it merelyprohibits the sale above a certain maximum price but it does not compel anyoneto sell at that price. I hold, therefore, that the plaintiff cannot seek theaid of S. 72, Contract Act, in the manner in which it has sought to do. Thissuit must, therefore, be dismissed with costs. Certified for two counsel.

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Jagadish Prosad Pannalalvs. Produce Exchange Corporation Ltd.(03.01.1945 - CALHC)