Reid, J.

1. The main contention for the appellant before their Lordships was that once the higher rate of royalty had come into operation, as it did in or about 1903, it was permanent and not affected by any future rise in railway freights. It was not, and could not be, argued that this question was determined in the appeal of 1917. Their Lordships then held the contingency on which an enhanced royalty would become payable, a fall in railway freight in consequence of 5 the construction of the Bengal Nagpur Railway, had become operative: and that the enhanced royalty was payable on coal despatched both by the East Indian Railway and by the Bengal Nagpur Railway. But this decision does not touch the question whether that enhanced royalty would continue to be payable if the rate of freight rose again to or beyond what it was when the lease was executed. This question must now be decided.

2. The obligation of the lessee set out in Clause 1 of the kabuliyat is that on the occurrence of two events, both of which have happened, "I shall pay royalty for those coals which will be despatched in the aforesaid manner at the said reduced freight at 5 annas per ton ..." It has been decided that "in the aforesaid manner" means by either of the railways mentioned. "At the said reduced freight" must refer back to "if... the freight of coal becomes less by "2 annas at least or more than what is fixed at present per "ton," and must therefore mean at a freight 2 annas or more below that in force at the date of the lease. The crucial question of construction can be stated thus: Do the words "at the said reduced freight" qualify the words "those" coals which will be despatched in the aforesaid manner "so as to limit the obligation to pay at 5 annas, etc., to coals which will be despatched at the said reduced freights" Or, on the other hand, do the words at the said reduced "freight" have some different purpose and effect so that the obligation to pay at 5 annas continues to attach to all coals despatched no matter what the freights may become in future

3. The argument for the appellant was that the leading words of the kabuliyat "mourushi mukarrari" require that the payment under the lease shall be at a rate permanently fixed. But the decision of their Lordships in 1917 established that, as regards all coal despatched by rail, the rates of royalty which were originally due under the lease - 3 annas and 1 anna 6 pies - had ceased to operate and rates of 5 annas and 2 annas 6 pies had come into operation. Therefore the words "mourushi mukarrari" must be read in a sense consistent with at least one variation of the rates of royalty at a date which could not be predicted when the lease was entered into. If that is so, there can in their Lordships view be ho insuperable obstacle to those words being read in a sense consistent with more than one such variation.

4. The plain and obvious meaning of the provisions of Clause 1 is that the higher rates of royalty shall be payable on coals despatched "at the said reduced freight" and on no other coal, so that if and when the freight rises to or beyond the original figure the higher royalty is not payable, but if and when the freight is 2 annas or more below the original figure the higher royalty is payable. This is a simple and reasonable construction of the words which the parties have used and their Lordships have found nothing in the contract which is inconsistent with it.

5. To appreciate the argument for the appellant it is necessary to examine the last sentence in Clause 1. It was possible that a reduction of freight following on the construction of the new railway might occur but be Jess than 2 annas, and the last sentence provides for this contingency. It is badly expressed and must be read as meaning "But if the said railway freight becomes less by less than 2 annas per ton...." In that event the rates of royalty are to be enhanced but by less than the full enhancement provided for in the preceding sentence. This is a reasonable provision which follows naturally on the preceding sentence and in no way conflicts with it. The argument for the appellant was that the sole purpose of the words "at the said reduced freight" in the preceding sentence is to differentiate that sentence from the last sentence in the clause. Their Lordships are unable to accept this argument. There is no need for any words for that purpose and if that were their purpose these words would be ill-chosen. Their Lordships have no doubt that that is not their purpose and that on this matter the decision of the High Court is right.

6. As the freight for coal despatched by rail after/April 1, 1921, exceeded the freight charged when the lease was made, it follows that after that date the lessee was only bound to pay royalties at the lower rates of 3 annas and 1 anna 6 pies per ton. But the lessee continued to pay royalties at the higher rates of 5 annas and 2 annas 6 pies per ton on coal despatched by rail during the period from April 1, 1921, to September 30, 1923, and so overpaid the lessor. The High Court have held that the lessee was not entitled to set off the amount of this overpayment against the royalties which subsequently became due by him, and the cross-appeal has been taken against this decision. The ground of the decision of the High Court was that the overpayment had been made because the lessee, the respondent, an4 his agents were unaware of their right under the lease; that this was not a mistake of fact but was a mistake of law; that the law of India in this matter is the same as the law of England; and that under the law of England money overpaid in such circumstances could neither be recovered nor set off against other payments due. Harries, C.J. said (1942) I.L.R. 22 Pat. 241: "There can be no doubt that under English law money paid under a mistake of fact is recoverable, but, generally speaking, money paid under a mistake of law is not recoverable. This has been clearly laid down in a large number of English authorities. The Indian Contract Act, though it deals with the effect of mistakes of fact and law upon a contract, has no express provision relating to the effect of payments made under such mistakes, and it appears to me that the law relating to the matter is the same in this country as it is in England." The learned Chief Justice appears to have overlooked the provisions of Section 72 of the Indian Contract Act. This section was only mentioned in passing by the Subordinate Judge, and it would seem that it was not argued, or only faintly argued, before the Subordinate Judge or in the High Court that Section 72 applied to this case. The appellant, the respondent in the cross-appeal, submitted to their Lordships that in these circumstances their Lordships should not now receive an argument based on Section 72, but their Lordships are unable to exclude from their consideration the provisions of a public statute. It is regrettable that their Lordships do not have the assistance of the views of the High Court on this matter. Their Lordships impute no blame to the learned judges of the High Court, but they feel bound to consider the argument which has now been adduced.

7. Section 72 enacts: "A person to whom money has been paid, or anything delivered, by mistake or under coercion, must repay or return it." This section makes no distinction between mistakes of fact and mistakes of law, but it must, of course, be read together with the rest of the Act and in particular with Sections 21 and 22, which also deal with mistake. Section 21 enacts: "A contract is not voidable because it was caused by a mistake as to any law in force in British India; but a mistake as to a law not in force in British India has the same effect as a mistake of fact." Section 22 enacts: "A contract is not voidable merely because it was caused by one of the parties to it being under a mistake as to a matter of fact." The construction of Section 72 has given rise to differences of opinion in India. There is a considerable body of authority dealing with the meaning of "coercion" in this section, but their Lordships have not found in those authorities anything which is of material assistance in deciding the present case. The authorities which deal with the meaning of "mistake" in the section are surprisingly few and it cannot be said that there is any settled trend of authority. Their Lordships are therefore bound to consider this matter as an open question.

8. Those learned judges who have held that mistake in this context must be given a limited meaning appear to have been largely influenced by the view expressed in Pollock and Mullas commentary on Section 72 of the Indian Contract Act, where it is stated (Indian Contract and Specific Relief Acts, 6th ed., p. 402): "Mistake of law is not expressly excluded by the words of this section; but Section 21 shows that it is not included." For example, in Wolf & Sons v. Dadyba Khimji & Co. (1919) I.L.R. 44 B. 631, Macleod, J. said referring to Section 72 "on the face of it mistake includes mistake of law. But it is said that under Section 21 a contract is not voidable on the ground that the parties contracted under a mistaken belief of the law existing in British India, and the effect of that section would be neutralized if a party to such a contract could recover what he had paid by means of Section 72 though under Section 21 the contract remained legally enforceable. This seems to be the argument of Messrs. Pollock and Mulla and as far as I can see it is sound." In Appavoo Chettiar v. South Indian Ry. (1929) A.I.R. (Mad.) 177, 178 Ramesam and Jackson, JJ. say: "Though the word mistake in Section 72 is not limited it must refer to the kind of mistake that can afford a ground for relief as laid down in Sections 20 and 21 of the Act.... Indian law seems to be clear, namely, that a mistake, in the sense that it is a pure mistake as to the law in India resulting in the payment by one person to another and making it equitable that the payee should return the money, is no ground for relief." Their Lordships have found no case in which an opinion that "mistake" in Section 72 must be given a limited meaning has been based on any other ground. In their Lordships opinion this reasoning is fallacious. If a mistake of law has led to the formation of a contract, Section 21 enacts that that contract is not for that reason voidable. If money is paid under that contract, it cannot be said that that money was paid under mistake of law: it was paid because it was due under a valid contract, and if it had not been paid payment could have been enforced. Payment "by mistake" in Section 72 must refer to a payment which was not legally due and which could not have been enforced: the "mistake" is thinking that the money paid was due when in fact it was not due. There is nothing inconsistent in enacting on the one hand that if parties enter into a contract under mistake in law that contract must stand and is enforceable, but, on the other hand, that if one party acting under mistake of law pays to another party money which is not due by contract or otherwise, that money must be repaid. Moreover, if the argument based on inconsistency with Section 21 were valid, a similar argument based on inconsistency with Section 22 would be valid and would lead to the conclusion that Section 72 does not even apply to mistake of fact. The argument submitted to their Lordships was that Section 72 only applies if there is no subsisting contract between the person making the payment and the payee, and that the Indian Contract Act does not deal with the case where there is a subsisting contract but the payment was not due under it. But there appears to their Lordships to be no good reason for so limiting the scope of the Act. Once it is established that the payment in question was not due, it appears to their Lordships to be irrelevant to consider whether or not there was a contract between the parties under which some other sum was due. Their Lordships do not find it necessary to examine in detail the Indian authorities for the wider interpretation of "mistake" in Section 72. They would only refer to the latest of these authorities, Pannalal v. Produce Exchange Corpn., Ld. (1946) A.I.R. (Cal.) 245, in which a carefully reasoned judgment was given by Sen, J. Their Lordships agree with this judgment. It may be well to add that their Lordships judgment does not imply that every sum paid under mistake is recoverable no matter what the circumstances may be. There may in a particular case be circumstances which disentitle a plaintiff by estoppel or otherwise.

9. In this case there was not sufficient evidence to show why the lessee and his agents made the overpayments. They may have acted on inadequate information, they may have taken a wrong view of their legal rights or they may have continued paying at the old rates without giving any thought to the matter. But it is clear that there was no intention to make a present to the lessor of money which was not due. The money was paid under the belief that it was legally due. This belief was mistaken. In their Lordships view that is sufficient to bring the case within Section 72 and therefore the cross-appeal must succeed. That being so, the question of interest involved in the appeal does not now arise.

10. Their Lordships will therefore humbly advise His Majesty that the appeal should be dismissed and the cross-appeal allowed and the plaintiffs suit dismissed with costs in the courts in India to the defendant. The appellant will pay the costs of the appeal and cross-appeal.