JUTE & GUNNY BROKERS LTD. versus M/S. NEW CENTRAL JUTE MILLS CO., LTD.

Citation: [1959] SUPP. 2 S.C.R. 79 · Decided: 20-01-1959 · Supreme Court of India · Bench: SUDHI RANJAN DAS · Disposal: Dismissed
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Judgment (excerpt)

• 
(2) S.C.R, SUPREME COURE.r REPORTS 
79 
JUTE & GUNNY BROKERS LTD. 
v. 
M/S. NEW CENTRAL JUTE MILLS CO., LTD. 
(S. R. DAS, c. J., s. K. DAS, P. B. GAJENDRAGADKAR, 
K. N. W ANCHOO and M. HIDAYATULLAH JJ.) 
. 
Contract-Validity-Ordinance making provision of regulation 
of trade-Act replacing Ordinance-Deeming 
provisions-Legal 
fiction-Effect-Raw Jute (Central Jute Board and Miscellaneous 
Provisions) Ordinance, r950 (W. Ben. r7 of r950), ss. 5, 6 and 7-
Raw Jute (Central Jute Board and Miscellaneous Provision.s) Act, 
r95r (W. Ben. 6 of r95r), ss. 5, 6, 7, r6. 
In respect of a dispute between the appellant company and 
the respondent company which ;was referred to the arbitration of 
the Bengal Chamber of Commerce in terms of the arbitration 
clause contained in the contract entered into on April 6, 1951, 
an award was made on February 29, 1952, allowing the claim of 
the appellant. The respondent made an application in the High 
Court for having the award set aside on the ground, inter alia, 
that the contract was void under the provisions of the Raw Jute 
(Central Jute Board and Miscellaneous Provisions) Act, 1951, 
inasmuch as it had not been entered into in the manner specified 
in ss. 5, 6 and 7 of the Act as required therein. On December 
14, 1950, the Government of West Bengal had promulgated an 
Ordinance called the Raw Jute (Central Jute Board and Miscel-
laneous Provisions) Ordinance, 1950, for the better regulation of 
the trade, and on December 29, 1950, a notification was issued 
specifying December 30, 1950, as " the appointed day for the 
purposes of ss. 5, 6 and 7 of the said Ordinance." Subsequently 
the Ordinance was replaced by the Act which bys. 16, provided: 
" ............ any notification issued ......... under the Raw Jute 
(Central Jute Board and Miscellaneons Provisions) Ordinance, 
1950, shall, on the said Ordinance ceasing to operate, be deemed 
to have been .. .issued ... under this Act as if this Act had com-
menced on the 14th day of December 1950." It was contended 
for the appellant that the notification dated December 29, 1950, 
could not be read as having brought ss. 5, 6 and 7 of the Act 
into force, because, on a plain reading of it, the notification did 
not purport to bring any of the sections of the Act into force, 
but expressly brought ss. 5, 6 and 7 of the Ordinance into force 
and that the said sections of the Act not having been brought 
into force, the contract in question was valid and, consequently, 
the award was binding and enforceable. 
Held, that in order to give full effect to the two legal 
fictions created in s. 16 of the Act that the Act shall be 
deemed to have commenced on December 14, 1950, and that the 
notification issued under the Ordinance shall be deemed to have 
I959 
January 20. 
80 
SUPREME COURT REPORTS [1959] Supp. 
I959 
been issued under the Act, the principle of mutatis midandis has 
to be adopted and the word "Act" substituted for the word 
jute G Gunny "Ordinance" used in the notification dated December 29, 1950. 
B•okcrs Ltd. 
Consequently, the provisions of ss. 5, 6 and 7 of the Act were 
v. 
applicable to the contract in question. 
M/s. New Central 
jute Mills Co., Ltd. 
CIVIL 
APPELLATE JURISDICTION : 
Civil Appeal 
Ko. 92 of 1954. 
Das C. ). 
Appeal from the judgment and order _dated Janu-
ary 28, 1953, of the Calcutta High Court in Award 
Case No. 105 of 1952. 
ill. Q. Setalvad, Attorney-General for India, B. Sen, 
P. D. Himatsinghka and B. P. Maheshwari, for the 
appellant. 
N. C. Chatterjee, M. G. Porf,dar and Ganpat Rai, for 
the respondent. 
1959. January 20. 
The Judgment of the Court 
was delivered by 
DAS, C. J.-This is an appeal filed upon a certificate 
of fitness granted by the High Court of Calcutta 
impugning the judgment pronounced by the said High 
Court on January 23, 1953, declaring null and void an 
award (No. 209 of 1952) made by the Bengal Chamber 
of Commerce in case No. 855 of 1951, whereby they 
ordered the respondent company to pay to the appel-
lant company a sum of Rs. 1,95,000 besides interest 
and costs. 
The facts giving rise to the present appeal are 
simple and may briefly be summarised as follows: On 
Apr~l 6, 1951, the appellant company entered into a 
contract with the respondent company for the supply 
of 5,000 maunds of Nikhli and/or Ashuganj Jute on 
certain prices according to quality, "shipment during 
July and/or August, 1951, guaranteed". That con-
tract, which was entered into by bought and sold n
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