S.S. Sandhawalia, C.J.
1. Whether a compulsory statutory sale of sugar by the producers under the Essential Commodities Act, 1955, mandates the concurrent tender of price against the delivery of sugar, or merely a deferred payment therefor, is the significant question before this Full Bench.
2. The relevant facts are not in serious dispute and may be noticed with relative brevity. The petitioner, Messrs Vishnu Sugar Mills Limited is a company registered under the Companies Act, having its registered office at Calcutta, it owns a sugar factory, since more than 30 years in the District of Gopalganj, within the Municipal area of the said town, wherein sugar is produced through the vacuum pan process. It is common ground that the production and sale of the sugar are controlled by the provisions of the Sugar Control Order, 1966, issued Under Section 3 of the Essential Commodities Act 1955 (hereinafter called the Act). In accordance with the Order aforesaid 65 per cent of the total production of sugar by the producers, including that of the petitioner company, is controlled by Government and is conveniently called as 'levy sugar', which the petitioner is bound in law to sell to the respondent Food Corporation of India (hereinafter called the Corporation) The remaining 35 per cent of sugar is called the 'free sugar', which is allowed to be sold in the open market by private negotiations, A grievance is made on behalf of the petitioner that grave delays on the part of the respondents to lift the levy sugar cause enormous financial losses to the petitioner as the entire sugar stock is pledged to the Banks on interest at the rate of 18 per cent, and, failure to take delivery of sugar by the respondents involves financial complications and heavy losses of interests and Bank charges to the petitioner.
3. The respondent Corporation is a company wholly owned by the Government of India and comes within the ambit of the 'State' under Article 12 of the Constitution. It is the biggest buyer of sugar, having a monopoly to buy the levy sugar from the producers by compulsory purchase mandated by law and in turn supplies the sugar to different whole-sellers and fair-price-shop dealers. In the year 1974, after deep deliberations between the officers of the Corporation and the representatives of the sugar-factories in Bihar, as also the officers of the Central Government, a procedure for payment for purchase of levy sugar from the sugar factories by the Corporation was duly decided and communicated by the Corporation itself, vide its letter dated the 5th July, 1974, which is Annexure '10' to the writ petition. This procedure mandated that in cases of deliveries by road transport, full payment must be made to the producer for the quantity programmed and to be lifted each day and directed the District Manager of the Corporation at Muzaffarpur to tender the price thereof by demand drafts, etc., observing all formalities from the Banks concerned, where the Corporation is operating its accounts. The aforesaid payment procedure contained in Annexure '10' continued to be followed by the respondent Corporation as well as the sugar factories in Bihar for over a decade. The petitioner's case is that the Corporation has now introduced a new procedure for payment, vide the impugned Annexure '5' dated the 30th April, 1985, unilaterally and entirely contrary to law' According to this procedure, sugar has to be delivered first to the representatives of the respondent Corporation, thereafter a bill has to be presented to him, which he would later take to the District Manager of the Corporation at Muzaffarpur, who would thereafter prepare a cheque and send it to the producer, It is pointed out that so far as the petitioner company is concerned the distance from its factory and the office of respondent No. 1 at Muzaffarpur is more than 200 miles and even namely, it would take more than 4 days in procuring the cheques from Muzaffarpur, apart from creating other serious practical difficulties. It is highlighted that once suguar has been delivered to the Corporation, the petitioner has merely to move and make requests to the officers of the respondent Corporation for payment, which is paid whimsically at their sweet-will, causing meanwhile enormous losses to the petitioner, including heavy Bank interests of 18 per cent on the goods.
4. Aggrieved by the new payment procedure, the petitioner company challenged the same in an earlier Civil Writ Jurisdiction Case No. 2252 of 1985, which was disposed of by the Division Bench on the 2nd of July, 1985, at the admission stage itself. Before the said Bench, the stand was taken on behalf of the respondent Corporation that the proposal had been made for opening 'Pay Offices' at the stations where the offices of the Mills are located, to facilitate payment under the new scheme, though this was bound to take some time. Further assurances were given on behalf of the Corporation to obviate all delays and the Bench consequently, merely issued the following directions, without opining upon the validity or otherwise of the impugned Annexure '5':
Keeping in view all the facts and circumstances and the Corporation's own assurance that the payment will be made within 24 hours, utmost, we direct that the payment of all the sugar delivered to the Corporation must be made in the usual prescribed manner within three days of date of submission of the relevant documents, including the delivery/despatch document or the railway receipt and the bills to the authorities of the Corporation.
With the above direction, this application is disposed of.
5. According to the petitioner, the respondent, far from complying with the spirit of the aforesaid order, construed it as an entitlement to withhold payment of price to the petitioner for 3 days or more, as a matter of right and that the petitioner is bound to deliver sugar to the Corporation irrespective of payment. A chart, Annexure '12' has been placed on the record to indicate grave delays in the payment to the petitioner, far beyond even the time indicated in the directions of the Court. The petitioner, thereafter, represented to the Corporation, but without any meaningful redress. Aggrieved thereby, the present writ petition has been filed, laying specific and pointed challenge to the validity of Annexure '5'.
6. In the counter-affidavit filed on behalf of the respondent Corporation, the plea sought to be taken is that the earlier direction of the High Court in Civil Writ Jurisdiction Case No. 2252 of 1985 (Annexure '11') had directed payment within three days from the date of the submission of the delivery/despatch documents, etc., to the Corporation, and the petitioner cannot seek a review or revision of that alleged direction. It is stated that the payment procedure is according to the instructions and circulars issued by the head office of the Corporation and the Government of India, and, further, that some delays in making payments for sugar purchased are unavoidable. The earlier payment procedure (Annexure '10') is admitted, but the stand taken is that the same was a periodical one and, in fact, the then Regional Manager had no jurisdiction to issue the said circular. It is categorically stated that Annexure 10 was illegal and, consequentially, on the 27th of March, 1985, the Regional Manager issued letters to the District Managers concerned that payments should be made in accordance with an earlier circular dated the 7th of December, 1972, issued by the head office. On behalf of the respondent Corporation the tenor of the stand is that some delays in the payment of bills for the deliveries made to them are inevitable and that the earlier procedure involved advance payments, and, in some cases, due to mal-functioning, there had been excess payment and loss to the Corporation. The payment procedure in the impugned Annexure '5' is thus sought to be adhered to.
7. In the reply filed on behalf of the petitioner to the counter-affidavit, the earlier position is reiterated and the stand taken by the respondent Corporation is controverted both on facts and in law. Annexure '25', a communication from the District Manager of the respondent Corporation, has been placed on the record, putting the under mentioned interpretation on the earlier directions of the High Court:
Under aforesaid circumstances, it is pointed out that the High Court has decided the case in our favour and Miller has been asked to adhere to the payment procedure adopted by Food Corporation of India. Our Sr. Regional Office, Patna, has accordingly instructed this office to lift entire backlog quota as well as current release of levy sugar expeditiously and strictly by adopting revised payment procedure, which has also been ratified by Patna High Court.
Charts Annexures 25 and 27 have been placed on the record indicative of the routine and grave delays, sometimes of 11 days or more, in the payments made.
8. This case originally came up for admission before a Division Bench to which one of us was a party. At the threshold both the contending parties attempted to place reliance on the earlier directions of the Court in C.W.J.C. 2252 of 1985 and equally assailed some part of the direction given therein. In order to set the controversy at rest, the case was admitted to hearing by a Full Bench and that is how it is before us.
9. Mr. Shrinath Singh, the learned Senior Counsel, in assailing the payment procedure (Annexure 5) placed basic reliance on Sections 3(2)(f), 3(3) and 3(3-C) of the Act and the relevant provisions of the Sale of Goods Act, 1930. It was submitted that though a compulsory statutory sale envisaged in the Act has been upheld but the necessary concomitant of the same is that the payment of price and the delivery of goods are the concurrent conditions. According to the learned Counsel, the law in the context of a compulsory sale envisages a great emphasis on tender of price against delivery unless it has been otherwise agreed upon. He highlighted that far from there being any such agreement, the petitioner and the producers have always been insistent upon this condition, because once delivery has been made, payments should not be allowed to be held up and deferred at the whims of the officials of the respondent Corporation. Counsel firmly took the stand that the petitioner in no way claimed any advance payment and the allegation in this context by the respondents is scrupulously controverted. It is reiterated that all that is sought is a conformity with the law that the respondent Corporation should be ready and willing to pay the price in exchange for the delivery and possession of sugar in their favour.
10. To put the stand of the petitioner in its proper perspective at the very outset, a word necessarily has to be said about the compulsory statutory sales. The ordinary concept of sale is a consensual one which would necessarily envisage the basic ingredients of a contract, where the parties mind are ad idem on the solid base of offer and acceptance. In a somewhat sharp deviation therefrom statutory provisions have now introduced the concept of a sale mandated by law in which the seller has no longer an absolute volition and within limitations is obliged by statutory sanction to part with his goods either for an agreed price or even for a controlled price fixed by the law. The very exercise of the power of compulsory sale even now mandated by statute had been earlier seriously assailed as unconstitutional and violative of Articles 14 and
19. However, this has now been finally upheld by their Lordships of the Supreme Court. It, therefore, seems unnecessary to delve deeper into the history of statute law or precedent in this context.
11. Herein we are primarily concerned with the narrow field of a compulsory sale under the Essential Commodities Act, 1955. It is both apt and instructive to view it in the larger perspective the legislative history of the provisions as also of the Act manifested from the interlinked provisions of Sections 3(2)(f), 3(3), 3(3-A), 3(3-B) and 3(3-0) of the Act.
12. For the above purpose it is unnecessary to travel beyond the predecessor statute, namely, the Essential Supplies (Temporary Powers) Act, 1946. This was succeeded by the present Essential Commodities Act, 1955. However, a spate of amendments have followed thereafter some of which call for notice as a clear pointer of the legislative intent with regard to the payment of price to the seller. Sub-section (3) of Section 3 of the Act not only formed part of the Act as originally enacted in 1955 but in fact corresponds with and is substantially in pan materia with the earlier Section 3 of the Essential Supplies (Temporary Powers) Act, 1946. This provision expressly provides for the payment of the price in accordance with Clauses (a), (b) and (c) thereof, to any person directed to sell an essential commodity in compliance with an order made with reference to Section 3(2)(f) of the Act. However, at that stage provisions of Sub-sections (3-A), (3-B) and (3-C) were significantly absent from the statute. It was by the Essential Commodities (Amendment) Act, 1957 (Act 13 of 1957) that Sub-section (3-A) was inserted in the statute. This was in the nature of an emergency provision for controlling the rise in prices and preventing the hoarding of foodstuffs in any locality and the notification issued thereunder was not to extend beyond the period of three months. However, even here also Sub-clauses (a), (b) and (c) of Clause (iii) expressly provided for the statutory determination of price for any person obliged to sell foodstuffs under an order Under Section 3(2) of the Act. Nearly a decade later, by the Essential Commodities (Second Amendment) Act, 1967 (Act 36 of 1967) Sub-sections (3-B) and (3-C) were then added to the statute. Herein again Sub-section (3-B), which pertains specifically to food grains, edible oil-seeds and edible oils, expressly provided for the statutory price payable to the person from whom the compulsory sale or purchase was made Under Section 3(2)(f) of the Act. Sub-section (3-C) is then the specific provision with regard to the statutory sale of any kind of sugar. This is even more explicit spelling out the guide-line for payment of price to the person required to sell Under Section 3(2)(f). This Sub-section mandated that there shall be paid to the producer a price which shall be calculated with reference to such price of sugar as the Central Government may by order determine. Not leaving it to the discretion o f the Central Government alone for the determination of the price, the Legislature itself provided the basic criteria by Clauses (a), (b), (c) and (d) for the determination of such price which is mandated to be paid to the producer.
13. I have somewhat painstakingly adverted to the aforesaid legislative history to highlight the solicitude of the Legislature at each step in chronological order to mandate not only that the price shall be paid to the producer but also meticulously prescribe the criteria on which the price for compulsory purchases Under Section 3(2)(f) was to be determined. Whilst on the one hand the Legislature conferred wide-ranging powers or regulation of statutory sales of essential commodities, it equally provided the safeguard that the price payable to the citizen for such compulsory purchase was to be tendered to him and further that it was a just equivalent thereof. The determination of the price and its payment were not left to the whims of the executive but were prescribed by clear mandate of the Legislature itself. The larger historical conspectus of legislation on the essential commodities is that it is a beneficent regulatory measure and was in no way designed to be either expropriatory or confiscatory.
14. Having noticed the larger principle and the history and the language of the statute, one might as well make a brief reference to precedent in this context. In Vishnu Agencies (Pvt.) Ltd. v. Commercial Tax Officer and Ors. a seven Judges Constitutional
Bench overruled the earlier view in New India Sugar Mills Ltd. v. Commissioner of Sales Tax and State of Tamil Nadu v. Cement Distributors Private Ltd. to hold that even a statutory sale may have some modicum of consensuality so as to remain a sale in the eye of law and consequently would be exigible to sales tax. Nearer home, in the particular context of sales of sugar under the provisions of the Levy Orders the Division Bench in The Belsund Sugar Co. Ltd. v. The State of Bihar and Ors. 1977 P.L.J.R. 8 observed as under:
In my opinion, whenever the petitioner Company accepts supply of sugar cane from the cane-growers a sale takes place in which the petitioner is a "buyer", and whenever it delivers sugar to the purchasers, sale takes place no sooner the sugar is marked and appropriated to the contract and in such cases the petitioner Company is a seller.
15. In the light of the aforesaid discussion, it seems now beyond cavil that even a compulsory statutory sale is a sale in the eye of law and the necessary legal incidents of such a transaction are equally applicable thereto.
16. One may now advert somewhat more specifically to the statutory provisions for the compulsory sale of levy sugar. The source of the power is rooted in Section 3(2)(f) which is in the following terms:
3. * * * * * * * *
(2) Without prejudice to the generality of the powers conferred by Sub-section (1), an order made thereunder may provide: * * * * * * * *
(f) for requiring any person holding in stock, or engaged in the production, or in the business of buying or selling, of any essential commodity,
(a) to sell the whole or a specified part of the quantity held in stock or produced or received by him; or
(b) in the case of any such commodity which is likely to be produced or received by him, to sell the whole or a specified part of such commodity when produced or received by him, to the Central Government or a State Government "or to an officer or agent of such Government or to a Corporation owned or controlled by such Government or to such person or class of persons and in such circumstances as may be specified in the order.
Section 3(3) then genetically provides for the obligation of the payment of price in case of all statutory sales as under:
Where any person sells any essential commodity in compliance with an order made with reference to Clause (f) of Sub-section (2), there shall be paid to him the price therefor as hereinafter provided * * * * * * * *
With more particularity Sub-section (3-C) deals with the statutory sales of any kind of sugar as under:
Where any producer is required by an order made with reference to Clause (f) Sub-section (2) to sell any kind of sugar (whether to the Central Government or to any other person or class of persons) and either no notification in respect of such sugar has been issued under Sub-section (3-A) or any such notification, having been issued, has ceased to remain in force by efflux of time, then, notwithstanding anything contained in Sub-section (3), there shall be paid to that producer an amount therefor which shall be calculated with reference to such price of sugar as the Central Government may, by order determine, having regard to: * * * * * * * *
Lastly the provisions of Clause 2 of the Levy Sugar Supply (Control) Order, 1979, call for notice, which reads, inter alia, as under:
2. Powers to issue directions to supply levy sugar. (1) The Central Government may, from time to time, by order, issue directions to any producer or recognised dealer to supply levy sugar of such type or grade and in such quantities
(a) to such persons or organisations, in such areas or markets; or
(b) to such State Governments, as may be specified in the order and at a price not exceeding the price determined under Sub-section (3-C) of Section 3 of the Essential Commodities Act, 1955.
Now even a plain reading of the aforequoted provisions would make it manifest that these in essence mandate a sale of an essential commodity in general, and sugar in particular to the Central or the State Government or to Corporations owned or controlled by them or to such persons or class of persons and in such circumstances as may be specified by an order issued under the Act. It is significant to highlight that the Essential Commodities Act, though having a definition clause, does not even remotely attempt or seek to define the concepts of sale or purchase. No special or different meaning is given thereto with regard to statutory sales. Therefore the general law of sale and purchase of goods would mutatis mutandis be equally applicable and attracted to statutory sale as well. Consequentially there can be perhaps no manner of doubt that the levy sugar is to be sold under the directions of the State and the incidents applicable to such a sale under the Sale of Goods Act must necessarily apply to it as well.
17. What is the true import of the word 'sell' or 'sale' employed in the Act and in particular in Sub-section (3-C) and Clause 2 of the Levy Sugar Supply (Control) Order is, therefore, the core question here. On principle and the language of the statute, it seems plain that barring the element of compulsion in statutory sales the other indicia and requirements of sale under the law of the land are equally applicable to such sales. Any doubt, if at all remained with regard to the import of the word 'sale' or 'sell' employed in the statutory provisions, would be well resolved by reference to The State of Madras v. Gannon Dunkerly and Co. Madras Ltd. . Therein, even when the word 'sale' was employed in a legislative entry (entry 48 of List 2 of Schedule VII), which authoritatively has to be construed with utmost liberality, their Lordships laid down in no uncertain terms that the meaning to be given thereto was the same as that in the Sale of Goods Act. It was observed as under:
We are unable to agree with this contention. If the words 'sale of goods' have to be interpreted in their legal sense, that sense can only be what it has in the law relating to sale of goods. The ratio of the rule of interpretation that words of legal import occurring in a statute should be construed in their legal sense is that those words have, in law, acquired a definite and "precise" sense, and that, accordingly, the Legislature must be taken to have intended that they should be understood in that sense. In interpreting an expression used in a legal sense, therefore, we have only to acertain the precise connotation which it possesses in law.
The aforesaid view has not been deviated from and it seems unnecessary to overly elaborate the matter, because Mr. Pandey, the learned Counsel for the respondent, did not at any stage contest the aforesaid legal proposition. It must, therefore, be held that the words 'sell' and 'sale' in the Act and in the Levy Order have to be read and given the same meaning as in the Sale of Goods Act.
18. Once it is held as above, one may now go to the relevant part of Sections 2 and 4 and in particular to Sections 31 and 32 of the Sale of Goods Act, which are in the following terms:
2. Definitions. In this Act, unless there is anything repugnant in the subject or context,
* * * * * * * *
(2) 'delivery' means voluntary transfer of possession from one person to another;
* * * * * * * *
(13) 'seller' means a person who sells or agrees to sell goods; * * * * * * * *
4. Sale and agreement to sell. (1) A contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the "property in goods to the buyer for a price. There may be a contract of sale between one part-owner and another.
31. Duties of seller and buyer. It is the duty of the seller to deliver the goods and of the buyer to accept and pay for them, in accordance with the terms of the contract of sale."
32. Payment and delivery are concurrent conditions. Unless otherwise agreed, delivery of the goods and payment of the price are concurrent conditions, that is to say, the seller shall be ready and willing to give possession of the goods to the buyer in exchange for the price, and the buyer shall be ready and willing to pay the price in exchange for possession of the goods.
19. It seems somewhat plain from the aforesaid provisions that the petitioner herein would be the seller within the meaning of Section 2(13) above and the voluntary transfer of possession by the petitioner company would amount to delivery Under Section 2(2) above. By virtue of Section 4, the very essence of a sale of goods is the agreement to transfer the property in the goods to the buyer for a price. Manifestly the price and transfer of the property are the mutually balancing terms. It is unnecessary to advert in any great detail with regard to the rules for ascertaining the intention of the parties as to the time at which the property in the goods is to pass to the buyer. This is so because herein there is no manner of dispute that the transfer of property in the sugar as between seller and buyer would inevitably take place on delivery in the absence of any contract to the contrary. Section 31 aforequoted clearly lays down that the duty of the seller is to deliver the goods and of the buyer to accept and pay for it. Section 32 aforesaid then puts all controversies at rest by mandating that unless otherwise agreed, payment and delivery are concurrent conditions. The buyer must be ready and willing to pay the price in exchange for the possession of the goods. The law thus madates the tender of price and delivery of goods to be simultaneous and concurrent terms. From what follows hereinafter, it seems unnecessary to labour the point. The rule aforesaid can only be deviated from by express exclusion only by the mutual agreement of the parties. Admittedly there is no such agreement and no such exclusion whatsoever. Far from this being so, the petitioner throughout has been vehement in seeking and demanding payment against delivery. Indeed in the context of a statutory sale where mutuality is lacking in the sense that the seller has no absolute volition in the matter and is obliged to sell under the sanction of law, the requirements of Sections 31 and 32 of the Sale of Goods Act have to be somewhat strictly construed and enforced. It must, therefore, be held that in a statutory sale in the absence of any agreement to the contrary whilst the seller is obliged to sell and then deliver the goods trader the sanction of law, the buyer is equally bound to tender the price thereof against delivery.
20. Herein the stand taken by Mr. Pandey, the learned Counsel for the respondent corporation, deserves notice. He very fairly did not and indeed could not dispute the now settled proposition that a compulsory sale is nevertheless a sale in the eye of law having all the ingredients thereof except that of absolute mutuality. Vishnu Agencies (Pvt.) Ltd. v. Commercial Tax Officer and Ors. (supra) sets all controversies in this context at rest. Equally he laid no serious challenge to the applicability of the provisions of Sections 31 and 32 of the Sale of Goods Act and was candid enough to say that after delivery and the passing of the property to the corporation the payment thereof should not be deferred. However, Mr. Pandey basically harped upon and high-lighted the practical difficulties faced by a corporation of respondent No. one's size in tendering the price of sugar against its delivery. It was sought to be pointed out that the respondent corporation has its own rules about the persons authorised to sign cheques and other negotiable instruments, and the somewhat intricate procedure therefor. It was the case that the earlier payment procedure had led to some irregularities and some chance of loss by way of advance payments to certain sellers.
21. I am not unmindful of some organizational difficulties which a large corporation may have to face to meet the strict requirements of the law with regard to concurrent payments against delivery. Yet nothing could be pointed out to us which renders it insuperable for the respondent corporation to abide by its duty to tender the price of sugar when it is delivered to it either in cash or by negotiable instruments like crossed cheque, demand draft, pay-order, etc. Indeed, it is a common ground that in the earlier payment procedure vide Annexure 10, which held the field for nearly 11 years, the concurrent payment against delivery was the settled rule. Many a Banking procedure is today available to meet and cater to such a requirement. If earlier there has been some difficulty or loss owing to the defaults of the Corporation's own employees, it is for them to set their own house in order, because these appear to be defaults of their own creation. When under the law the seller has parted with the possession of his goods and delivered the same to the corporation, it is for the latter to see the mode and manner of the tender of the price therefor as a concurrent condition mandated by Sections 31 and 32 of the Sale of Goods Act. In my view the law is not different for the. larger national corporations from that for the smallest of the country's citizens and it cannot be bent to meet the convenience or needs of any such organizations howsoever big. It bears repetition that herein we are dealing with statutory sale and it is not only meet but indeed proper that in transactions of this nature where otherwise freedom of contract and mutuality has been taken away by way of a compulsory sale, the safeguard of a concurrent tender of price against delivery of goods should be rigorously enforced. To my mind it seems that any deviation from the sound mandate of law in this context would be fraught with danger. Deferred payments or long delay for huge financial amounts in this context cannot but lead to abuse or corrupt practices in a set up where the commercial mores leave such to be desired.
22. Once it is held as above, it seems somewhat plain that the impugned payment procedure contained in Annexure 5 runs counter both to the letter and the spirit of the law. In this context it is well to recall that the previous payment procedure now (vide Annexure 10) sought to be set at naught earlier rightly mandated the concurrent payment of price against delivery. This was not only so as a matter of law but equally as a matter of agreement, as indicated in Annexure 10, arrived at betwixt the officials of the Corporation, the Special Secretary, Supply and Commerce Department, Patna, and all the representatives of the sugar mills in the presence of Shri K.S. Kohli, Senior Deputy Manager (Sugar), Head Office, F.C.I., New Delhi. The relevant part thereof provided as under:
(ii) In case of road movement, full payment be made to the miller for quantity programmed and to be lifted each day. For this purpose, the Distt. Manager, F.C.I. Muzaffarpur, on receipt of the despatch instructions from the Regional Office should chalk out date-wise lifting and movement programme indicating the quantity to be lifted each day from each mill and tag the quantity with the Contractor by whom the same has to be lifted. The Distt Manager, Muzaffarpur, should simultaneously arrange to obtain demand drafts, observing all formalities, from the concerned Banks where the F. C. I. is operating their account, covering the price and central excise duty of sugar required to be lifted each day according to the programme chalked out, and hand over the same to the Asstt. Manager, F.C.I. representative incharge of the mill, who will hand over the demand draft to the miller for the quantity programmed and to be lifted each day.
This clear-cut payment procedure is now sought to be unilaterally set aside for no other reason except some instances of advance payment apparently because of the default of some of the corporation's erring employees. The new impugned procedure (Annexure 5) in letter and spirit now requires that first delivery should be made to the corporation only against an initial payment of Rs. 20 per quintal of the delivered goods. Thereafter the sellers are required to submit the delivery despatch documents and purchase bills to a centralised payment office at Muzaffarpur. Though the suggested payment thereafter is expeditious yet it is plain that having already delivered the goods and the property having passed to the corporation, the sellers are thereafter left to the tender mercy of the corporation officials for the payment or clearance of their mills. Mr. Srinath Singh, learned Counsel for the petitioner, rightly highlighted that the impugned procedure, in terms, postpones payments and submitted that even the supposed next day rule therefor is only a pious wish incapable of enforcement in actual practice because without a concurrent tender of money, tomorrow would be followed by yet another tomorrow reminding one of Shakespeare's celebrated line "Tomorrow, and tomorrow, and tomorrow, creeps in this petty pace from day to day to the last syllable of recorded time." From the charts Annexures 26 and 27, learned Counsel for the petitioner forcibly pointed out that under this procedure despite the lip service to early payments in actual effect, there were endemic delay and tomorrow, in terms, has become 11 days' or more and there is no guarantee as to how far it would extend in future. Equally, it was pointed out that the delays herein arc not a matter of mere waiting but actually financial loss piling up from day to day. It was highlighted that on the basic methodology on the present day business world the sugar stocks stand pledged to the banks and until payment is made to them, heavy rates of interest at 18 per cent or above keep on mounting thereon to the detriment of the petitioner. This apart, once delivery factually has been made, there is no sanction worth the name for the expeditious enforcement of the large payments and counsel colorfully highlighted the evil practices which spring from such a breeding ground.
23. Before closing a word has necessarily to be said about the earlier judgment in C.W.J.C. 2252 of 1985 decided on the 2nd of July, 1985 which, indeed, has necessitated the admission of this case for a hearing by the Full Bench. A reading of the order passed at the admission stage itself only seems to indicate the danger inherent in disposing of meaningful issues at the motion stage itself by an expedient order of an interlocutory nature. Though the payment procedure (Annexure 5) was challenged in the writ petition, the same was neither upheld nor quashed nor any meaningful reference was made thereto. Neither principle nor precedent was cited or referred to for arriving at a conclusion for giving a direction and disposing of the application thereby. It is thus not surprising that either of the parties construed the same as being in its favour and equally sought to assail a part thereof. A reading thereof would indicate that it was more of an expedient hotchpotch or a patchwork betwixt the parties than enunciation of a clear-cut rule to be followed. Without going into the incidents of a statutory sale and the requirements of law under the Sale of Goods Act, it was suggested that payments may be made in the usual prescribed manner and even sanctifying a delay of three days beyond the submission of the relevant documents, etc., without visualising that once the delivery has been made, the commercial sanction for payment is gone. With the deepest and deference, we are constrained to overrule the said order.
24. To conclude, the answer to the question posed at the outset is rendered in the affirmative and it is held that a compulsory statutory sale of sugar by the producer under the Act mandates the concurrent tender of price against the delivery of sugar and not merely a deferred payment therefor unless it is otherwise agreed betwixt the parties.
25. From the aforesaid finding and earlier discussion it necessarily follows that the impugned payment procedure contained in Annexure 5 runs counter both to the letter and spirit of Section 3(3-C) of the Act and clause 2 of the Levy Sugar Supply (Control) Order, and the aforementioned provisions of the Sale of Goods Act. The same is, therefore, not sustainable in law. The corporation must abide by the payment procedure in conformity with the cardinal rule that in the context of compulsory statutory sale the law mandates a concurrent tender of price against delivery of sugar and not a deferred payment thereafter on the whimsicality of the compulsory purchaser. Obviously this is subject to the qualification in Section 32 of the Sale of Goods Act that it may be provided otherwise by a mutual agreement of parties.
26. The writ petition is accordingly allowed and Annexure 5 is hereby quashed. There will, however, be no order as to costs.
S.K. JHA, J.
27. I entirely agree with My Lord the Chief Justice, but in order to highlight some matters canvassed at the Bar, I feel obliged to say a few words of my own lending support to the judgment and order of the learned Chief Justice.
28. Section 32 of the Sale of Goods Act, 1930, to which the learned Chief Justice has already taken note of in his judgment, mandates that unless otherwise agreed, delivery of the goods and payment of the price are concurrent conditions, that is to say, the seller shall be ready and willing to give possession of the goods to the buyer in exchange for the price, and the buyer shall be ready and willing to pay the price in exchange for possession of the goods. A contract of sale always involves reciprocal promises be it in the nature of 'barter' or 'quid pro quo' in any form, with regard to delivery of goods on the part of the seller and the acceptance thereof on the part of the buyer in lieu of payment thereof. "Sale of Goods" is a nomen juries in the absence of any contract to the contrary, they are to be performed simultaneously. Parties may agree to deviate from the ordinary rule, but that is not the case here. Under Section 32 of the Sale of Goods Act, in the absence of anything to the contrary expressed under the agreement, the delivery of the goods and the payment of price are concurrent conditions and if a party wants to prove that there was an agreement to the Contrary, it is for him to give such evidence as is necessary to prove it. No such agreement has been, pressed upon our attention in this case by the learned Counsel for the respondents.
29. The concept of sale remains the same. Whether it be a sale under the general law or a compulsory sale under a statutory mandate not inhibited by any constitutional provision. The price for delivery of the goods must be convergent meeting or intersecting in a point and must run parallel to each other acting in conjunction. In other words, the transaction of 'sale' must operate or occur at the same time by payment for the goods at the time of delivery of such goods by the seller to the buyer.
30. The respondents' plea that a somewhat intricate procedure was involved leading to practical difficulties in the concurrent payments to the sellers has to be taken note of merely to be rejected. The practical inconvenience, if any, has to be so resolved by the buyer himself, because it is not a one-way traffic. The practical difficulties in such cases are bilateral, therefore, such practical difficulties cannot override the statutory provisions with regard to sales, either by reciprocal arrangement or compulsory. What is a sauce for a gander is a sauce for a goose too. Can we look to the practical difficulties in the way of one party only, namely, the buyer and not the other party, namely, the seller. If the seller's goods are pledged or hypothecated to the Bank against overdrafts running at a high rate of interest and the sugar cannot be released to them by the Bark unless they make payment of the price to the bankers, can we then be oblivious of the fact that the buyer is at liberty to insist upon delivery of sugar on the basis of a deferred payment when the seller is not in a position to deliver the sugar, which is pledged to the Bank and cannot be released unless the payment therefor is made to the Bank along with interest ? Wherefrom can the seller deliver the sugar to the buyer ? Therefore, in order to resolve these sort of practical difficulties in the way of the buyers and sellers both, such salutary statutory provision as Section 32 of the Sale of Goods Act, 1930, has been inserted in the Statute Book and the mandates of law as already detailed by My Lord the Chief Justice in the several provisions of the Essential Commodities Act, 1955, and the Sale of Goods Act have been incorporated.
R.N. PRASAD, J.
31. I agree.