TaxTMI 
TaxTMI 
1967 (9) TMI 144
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....e Specific Delivery Form prescribed under the byelaws of the Association. and on terms and conditions set out therein The respondents denied the existence of the contract and also its validity. The High Court dismissed the application holding that M/J(N)6SCI-13 the contract was invalid in that it did not comply with the requirements of s. 15 sub-s. (4) of the Forward Contracts (Regulation) Act, 1952. By special leave, the appellants have appealed to this Court. The relevant recitals in the notes, which, it was claimed, constituted the contract between the parties may first be set out: "7A, Clive Row, Calcutta-1 Sunder Lal & Son. Messrs. Bharat Handicrafts (Private) Ltd. Dear Sirs, We have, subject to the terms and conditions hereinafter referred to, this day sold to Messers., Sunderlal & Son by Your order, and on your account: Yours faithfully, Sunderlal & Sons. "Calcutta, 16th September, 1960 Messrs. Sunderlal & Son Dear Sirs, We have, subject to the terms and conditions hereinafter referred to this day bought from Bharat Handicrafts (Private) Ltd., by your order, and on your account: Yours faithfully, Sunderlal & Son. Validity of the contract was challenged by t....
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....onditions relating thereto, and the forms of contracts in writing. Sub-sections (1), (2) and (4) of s. 15 in force it the date of the contract were these: "(1) The Central Government may by notification in the Official Gazette, declare this section to apply to such goods or class of goods and in such areas as may be specified in the notification, and thereupon, subject to the provisions contained in section 18, every forward contract for the sale or purchase of any goods specified in the notification which is entered into in the area specified therein otherwise than between members of a recognised association or through or with any such member shall be illegal. (2) Any forward contract in goods entered into in pursuance of sub-section (1) which is in contravention of any of the bye-laws specified in this behalf under clause (a) of sub-section (3) of section 11 shall be void-- (i) as respects the rights of any member of the recognised association who has entered into such contract in contravention of any such bye-law, and also (ii) as respects the rights of any other person who has knowingly participated in the transaction entailing such contravention. (4) No member....
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.... the Appendix to the Bye-laws of the association. At the foot of the prescribed form of the note there is a slip in which normally the confirmation of the other party to the contract would be obtained,. The confirmation slip was it appears detached from the "sold" note, but it was not produced before the High Court by the appellants. Counsel for the appellants says that the respondents did give a slip confirming the contract in the " sold" note, but it was unfortunately not tendered in evidence in the High Court, and he applies for leave to tender in evidence that confirmation slip in this Court. The confirmation slip sought to be produced in this Court purports to bear the confirmation by a person who has signed it as 'M.L. Bahati'. This document was admittedly in the possession of the appellants and could have been produced by them in the High Court. No rational explanation is fur- nished for not producing the document before the High Court. Again the document does not prove itself: to make out the case that the respondents had consented in writing to the terms of the contract, evidence that the signature "M. L. Bahati" was subscribed by the ....
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....or authority by the respondents within three days from the date of the contract. Counsel for the appellants, however, contends that sub-s. (4) of s. 15 does not invalidate a contract merely because there is no writing evidencing or confirming the consent or authority of the non-member, even if the member has entered into a contract in respect of goods purchased or sold on his own account. Counsel says that the prohibition imposed by the Parliament against the entry into such a contract does not make it void: only by entering into the contract the appellants are rendered guilty of an offence under s. 20 sub-s. (2) of the Act. In support of that contention, counsel says, that since in ss. 15(1), 15(2), 17(2) and 19 the Parliament has expressly enacted that in certain eventualities forward contracts shall be illegal or void, but in s. 15(4) no such consequence is indicated, a contract even in breach of the prohibition is enforceable, though it may expose the appellants to a criminal prosecution. Reliance is placed in support of that plea upon Shri Bajrang Jute Mills Ltd. v. Lalchand Dugar 68 Cal. W.N. 749. in which the Calcutta High Court observed in dealing with the validity of a co....