P. S. N. S. AMBALAVANA CHETTIAR AND CO. LTD AND ANR. versus EXPRESS NEWSPAPERS LTD., BOMBAY

Citation: [1968] 2 S.C.R. 239 · Decided: 10-11-1967 · Supreme Court of India · Bench: K.N. WANCHOO · Disposal: Case Partly allowed

Judgment (excerpt)

A 
B 
c 
D 
E 
F 
G 
P. S. N. S. AMBALAV,\NA CHETIIAR AND CO. LTD 
AND ANR. 
v. 
EXPRESS NEWSPAPERS LTD., BOMBAY 
November 10, 1967 
(K. N. \VANCHOO, C.J., R. S. BACHAWAT AND G. K. MITTER, JJ.J 
Indian Sale of Goods Act (3 of 1930), ss. 18 and 
54(2)---Sale o.f 
unascertained goods-When property 
passes-Rcp11dit1~io11 nf contract-
Venclor's right of resale n•J.u:n arises. 
l11.!ia11 Contract_.Axl (9 of 1812), ss. 73 Illus. (c) and 176-Scope of. 
On 13(h.No~cmber 1951. the respondent agreed to sell to the appellants 
a stock' Of 415 tons Of newsprint in sheets then lying in the respondent's 
,godo\\·n. 
On 26th November, th-e parties varied the contract by agreeing 
that the appellants would buy only 300 tons out of the stock of 415 tons . 
. .\fter taking delivery of a part of the 
n·~\l.·sprint, the appellants refused 
to take delivery of the balance and repudiated the contract on '.!9th March 
1952. On 21st April the r~spondeot, aft~r notice to the appellants. resold 
the balance at a lesser rate.. The suit filed by the respondent claiming fron1 
the appellants the deficiency on r.esale \Vas decreed. 
In appeal to this Court, 
Held : (I) The claim was unsustainable. 
(a) As the respondent was not a pied gee of th·.2' newsprint. the res-
ponde.nt had no right to sell the goods under s.' 176 of the Jodian Contract 
Act. 1872. 
[242H] 
(b) A seller can claim as dan1ages the difference betwc-cn the contract 
price and the amount realised on reS'ale of the goods where he has the 
right 'of ""sale urder s. 54(2) of the Indian Sale of Goods Act. 1930. 
But this statutory pov•er of resale arises only if the property in the goods 
has passed to the buyer subject to the lien of the unpaid seller. 
Under 
s. 18. of the Sale of Goods Act. it is a condition prec·odent to the passing 
of property unde.r a contract of sale that the goods are ascertained. 
In 
the present case, "'lhen the contract \vas 9riginally entered into for the sale 
of 415 tons there v.'as an unconditional contract for the sail! of specific 
goods in a deliverable state and the prop-~rty in those goods then passed 
to the appellants. 
But the effect of the variation was not to make the 
appellants and respondent joint 01Aners of the stock of 415 tons. 
Nor 
was it merely to r·:licve the appellants fron1 their Jiability to take 11 S 
tons. The effect 'A'as to annul the passing of the property. so that. as 
from 26th November the property in the entire stock of 415 tons belonged 
to the respondent. The result was that in place of the original contract 
!or sale of SP'~c:.fic goods a contract for sale of unascertaincd goods v.·as 
~ubstituted. No portion of the stock of 415 tons was appropriated to the 
contract by the respondent with the appellants' consent before the resale. 
Therefore. on the date of resale. the property in the goods had not passed 
to the buyer 
(appellants) and tk respondent had no right to 
resell. 
f243A. E. F-H; 244A-BJ 
Gille!' v. Hill;. (1834) 2 C & M 535; 149 E.R. 871, applied. 
H 
(:!.) As no tin1e was .fixed under the contract of sale for acceptance 
of the goods, under s. 73 of the Indian Contract Act. the respondent was 
~ntitled to the difference between the contract price and the market price 
on 19th March 1952. the date of repudiation, as damages. 
(244E-CJ 
SUPREME COURT REPORTS 
[1%8] 2 S.CR. 
CivtL APPELLATE JuR1s01cno!'I: 
Civil Appeals Nos. 165 
and 166 of 1965. 
Appeals from the judgment and decree dated May 7, 1960 of 
the Madras High Court in 0.S.A. Nos. 25 and 52 of 1956. 
S. V. Gupte, Naunit Lal and R. Thiagarajan, for the appel-
A 
bnts (in both the appeals). 
B 
N. C. Cluuterjee, S. Balakrishnan for R. Ganapathy Iyer, for 
the respondent (in both the appeals). 
The Judgment of the Court was delivered by 
Bachawat, J. 
The dispute arises out of a contract between the 
appellants and the respondent entered into on November 13. 1951. 
The terms of this contract were recorded in writing in the form 
of a Jetter written by the respondent to appellant No. I and set 
out below: 
"Messrs. P. S. N. S. Ambalavana Chcttiar and 
Company Ltd., 
260, Angappa Naicken Street, Madras. 
Dear Sirs, 
We confirm having purchased from you and 
the 
Madras Paper Marketing Company, Madras, 500 tons 
c 
D 
of Russian Newsprint 
as per the 
following descrip-
E 
tion :-
About 70 per cent in reels of 34 inches width. 
" 
15 per cent in reels of 22 inches width. 
" 
15 per cent in reels of 36 inches width. 
at annas 9 per lb. Ex-Wharf Bomba

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