Ramchandraram Nagaram Rice & Oil Mills Ltd. v. Municipal Commissioners of Purulia Municipality

This analysis is written by Ishika Gupta pursuing BBA L.LB from Gitarattan International Business School. This analysis aims to provide all the necessary details about the case in brief.

INTRODUCTION

This case is basically about a company under whose name the plaintiff used to deliver kerosene oil. It was contented that the oil was impure but it could not be proved and the plaintiff again filled a suit in order to get compensation.

Case Number

Appeal 42 of 1940

Equivalent Citation

AIR 1926 Pat. 258, 12 Bom. 490

Bench

Hon’ble Justice Fazl Ali and Hon’ble Justice Verma

Decided On

26^th March, 1943

Relevant Act/ Section

Bihar and Orissa Municipal Act- Section 12,24,25,26 & 287,

Indian Companies Act

Facts of the Case

This is an appeal by the plaintiff against the decision of the trial court whereby the suit of the plaintiff was dismissed. Plaintiff was manufacturing oil and rice for the last 14 years and selling under the trademark “R. N. Bishnachandra”. The plaintiff despatched pure mustard oil in the cylindrical van to Purulia. On 3rd May, 1938, about 1000 canisters were filled with oil and delivered to customers as per the agreement. On 4th May, 1938, when the 100 tins were delivered to the customer/the defendant, he filed a case u/s 287 of the Municipal Act alleging that the oil has been contaminated with kerosene oil and had a bad odour. The case of the plaintiff was that allegations of the defendant were false and frivolous and he contended that the oil was pure and meant for human consumption. Sanitary inspector took samples of oil and after checking of oil by the Chemical analyst oil was found to be genuine. The plaintiff alleged that due to this conduct of the defendant, he suffered considerable losses. Therefore, he filed a suit for damages. The defendant put his defence that the oil was impure and the plaintiff has put it in a container containing kerosene oil. Defendant argued that the plaintiff has not suffered any loss and mere on the fact that the Chemical analyst did not find any impurity in the oil, it did not give any right to the plaintiff to file suit for damages against him.

Issues Before the Court

1. Whether the action of the municipality was just and reasonable in seizure of mustard oil?

2. Whether the plaintiff company suffer loss in the business and reputation due to arbitrary, malafide and malicious action of the defendants?

3. Whether the plaintiff is entitled to damages if so how much?

4. What amount the plaintiff is entitled to get on account of mustard oil and canisters?

Judgment

The High Court heard the arguments submitted on behalf of both the parties and after considering the facts and circumstances, it came to the conclusion that the plaintiff company is entitled to the difference between the actual price and the price realised at the auction sale and therefore, the High Court allowed the appeal granting damages to the plaintiff to the tune of Rs. 2012/- with interest at the rate of 6% per annum from this date till the realisation of the amount. The High Court in its judgment discussed the case of “Rup Lal Singh vs. Secretary of the State for India”, “Dixon vs. The Metropolitan Board of Works”, “Sutton vs. Clark” and “Nagar Valab Narsi vs. Municipality of Dhandhuka”

Ration of Case

Ratio decidendi of a case is whether the facts the judge has determined to be material facts of the case, plus the judge’s decision based on those facts of the material facts that the judge creates law.

Thus, Ratio Decidendi = Material Facts + Decision

In this case, the High Court kept in mind the material facts that

1) The plaintiff despatched the pure mustard oil to the defendants which were tested and found to be genuine by the Chemical Analyst.

2) The plaintiff has suffered a considerable loss due to the false and frivolous allegations of the defendants that the mustard oil was impure and bad in odour as it was mixed with kerosene oil.

3) The plaintiff is entitled to the difference between the actual price and price realised at the auction sale of the mustard oil.

Decision of Court

High Court allowed the appeal of the plaintiff. It held that the plaintiff company is entitled to the difference between the actual price and the price realised at the auction sale and therefore, the High Court allowed the appeal granting damages to the plaintiff to the tune of Rs. 2012/- with interest at the rate of 6% per annum from this date till the realisation of the amount.

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