# MESSRS. KHIMJI POONJA AND COMPANY v. SHRI BALDEV DAS C. PARIKH

- **Citation:** [1950] 1 S.C.R. 64
- **Court:** Supreme Court of India
- **Decided:** 1947-03-20
- **Case number:** Civil Appeal No. XXVI of 1949
- **Bench:** Shri Harilal Kania C.J, Saiyid F Azl Ali, Patanjali Sastri, Mehr Chand Mahajan, MuKHERJEA, S. R. Das
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/messrs-khimji-poonja-and-company-v-shri-baldev-das-c-parikh-145
- **Pages:** 11

## Headnote

Bombay Cotton Contracts Act (IV of 1982). s. 8(1)-East
India Cotlt!n Association Bye-laws, Nos. 61-A, 66-A, BO, 82-Cottcn
Oontract-Oontract note stating minimum amount of depo!ii DI
Rs. 26 and not in prescribed form-Validit11-Arbitration and
award und~r arbitration clause, whether void.
Section 8 of the Bombay Cotton Contracts Act, 1932, provided
that contracts entered into after the date of the commencement
of the Act which are not in accordance with the bye-laws of
any recognised cotton association shall be void. Bye-law 80 of
the East India Cotton Association, Ltd., which was a recognised
cotton association within the meaning of the Act provided that
contracts between members acting a.s commission agents on the
one band and their constituents on the other shall be subject to
the bye·laws and that a contract note in the form given in the
Appendix to the bye-laws shall be rendered in respect of every .
contract. Bye-law 51-A originally required a deposit at a rate
not less than Rs. 25 per bale and the contract note accordingly
contained a clause to that effect.
During the war this bye-law
was a.mended by reducing the minimum amount of deposit to
Rs. 12·8 per bale and introducing a new bye·law (bye·law 65-A)
which, ini'3r alia., gave certain options to the last buyer, and by
a Notification of the Government the form of tbe contract note
was also amended by altering the minimum deposit to Rs. 19-8
and adding two new clauses to comply with the bye-law 65-A.
A contract note rendered after these amendments to the byelaws and the form of contract note,' contained a rubber stamp
impression in which the minimum amount of deposit was stated
as Rs. 25, and did not contain the two new clauses that were
introduced by the Government Notification :
Held, that the
contract
note
rendered
was
not in
accor<la,nce with the bye-laws and in the prescribed form as
the clause relating to the minimum amount ·of deposit was inconsistent with the provisions of bye-law 51-A as amended, and
the two new clauses had been omitted, even though the con-.
tra.ct note recited that it was made in accordance with the byelaws, and it was accordingly void and a valid award could not
be made under the arbitration clause contained in the note.
[PATAN.JALI 8ABTRI J. preferred to rest his deci~ion solely
on the ground of the omission to include in the contract in question the two clauses newly added in the prescribed form in order
to give effect to bye·law 65·A.]
Judgment of the Bombay High Court affirmed.
S.C.R.
SUPREME COURT REPORTS
65
APPEAL from the High Court of Judicature at Bom1900
bay. Civil Appeal No. XXVI of 1949.
·
Messrs. Khimji
This was an appeal from a judgment and decree of the
Poonja &- Co •
. Bombay High Court (Stone C.J. and Coyajee J.) dated
v.
20th March, 1947, in Appeal No. 42 of 1946, reversing a Shri Balde.., Das
• d
t f Ch
l J d'
. .
l' t'
d
C. Parikh.
JU gmen o
ag a . 1sm1ssmg an app 1ca 10n ma e
by the respondent under the Indian Arbitration Act,
1940, praying inter alia that the arbitration agreement
containe<j in certain contract notes sent by the appellants to the respondent be declared invalid and void
and for setting aside an award made by arbitrators
appointed under the said contract note.
M. G. Setalvad, (Rameshwar Nath with him), for
the appellants.
G. K. Daphtary, ( B. Sen and K. T. Desai with him),
for the respondent.
1950. March 14.
The judgment of the Court was
delivered by
DAS J.-This appeal arises out of an application
Das J.
made by the Respondent under the Indian Arbitration
Act, 1940, praying inter alia that the arbitration
agreement contained in certain contract notes including contract note No. 17996 sent by the Appellants to
the Respondent be declared to be invalid, void and
unenforceable and be set aside and that a purported
award made by the arbitrators appointed in terms of
the said contract notes be set aside. That application
came to be made in the following circumstances :
The Appellants were and are members of the

## Text

1960
March 14.
SUPREME COURT REpORTS
(1950]
MESSRS. KHIMJI POONJA AND COMPANY
v.
SHRI BALDEV DAS C. PARIKH
(SHRI HARILAL KANIA C.J., SAIYID F AZL ALI,
PATANJALI SASTRI, MEHR CHAND MAHAJAN,
MuKHERJEA and S. R. DAS JJ.]
Bombay Cotton Contracts Act (IV of 1982). s. 8(1)-East
India Cotlt!n Association Bye-laws, Nos. 61-A, 66-A, BO, 82-Cottcn
Oontract-Oontract note stating minimum amount of depo!ii DI
Rs. 26 and not in prescribed form-Validit11-Arbitration and
award und~r arbitration clause, whether void.
Section 8 of the Bombay Cotton Contracts Act, 1932, provided
that contracts entered into after the date of the commencement
of the Act which are not in accordance with the bye-laws of
any recognised cotton association shall be void. Bye-law 80 of
the East India Cotton Association, Ltd., which was a recognised
cotton association within the meaning of the Act provided that
contracts between members acting a.s commission agents on the
one band and their constituents on the other shall be subject to
the bye·laws and that a contract note in the form given in the
Appendix to the bye-laws shall be rendered in respect of every .
contract. Bye-law 51-A originally required a deposit at a rate
not less than Rs. 25 per bale and the contract note accordingly
contained a clause to that effect.
During the war this bye-law
was a.mended by reducing the minimum amount of deposit to
Rs. 12·8 per bale and introducing a new bye·law (bye·law 65-A)
which, ini'3r alia., gave certain options to the last buyer, and by
a Notification of the Government the form of tbe contract note
was also amended by altering the minimum deposit to Rs. 19-8
and adding two new clauses to comply with the bye-law 65-A.
A contract note rendered after these amendments to the byelaws and the form of contract note,' contained a rubber stamp
impression in which the minimum amount of deposit was stated
as Rs. 25, and did not contain the two new clauses that were
introduced by the Government Notification :
Held, that the
contract
note
rendered
was
not in
accor<la,nce with the bye-laws and in the prescribed form as
the clause relating to the minimum amount ·of deposit was inconsistent with the provisions of bye-law 51-A as amended, and
the two new clauses had been omitted, even though the con-.
tra.ct note recited that it was made in accordance with the byelaws, and it was accordingly void and a valid award could not
be made under the arbitration clause contained in the note.
[PATAN.JALI 8ABTRI J. preferred to rest his deci~ion solely
on the ground of the omission to include in the contract in question the two clauses newly added in the prescribed form in order
to give effect to bye·law 65·A.]
Judgment of the Bombay High Court affirmed.
S.C.R.
SUPREME COURT REPORTS
65
APPEAL from the High Court of Judicature at Bom1900
bay. Civil Appeal No. XXVI of 1949.
·
Messrs. Khimji
This was an appeal from a judgment and decree of the
Poonja &- Co •
. Bombay High Court (Stone C.J. and Coyajee J.) dated
v.
20th March, 1947, in Appeal No. 42 of 1946, reversing a Shri Balde.., Das
• d
t f Ch
l J d'
. .
l' t'
d
C. Parikh.
JU gmen o
ag a . 1sm1ssmg an app 1ca 10n ma e
by the respondent under the Indian Arbitration Act,
1940, praying inter alia that the arbitration agreement
containe<j in certain contract notes sent by the appellants to the respondent be declared invalid and void
and for setting aside an award made by arbitrators
appointed under the said contract note.
M. G. Setalvad, (Rameshwar Nath with him), for
the appellants.
G. K. Daphtary, ( B. Sen and K. T. Desai with him),
for the respondent.
1950. March 14.
The judgment of the Court was
delivered by
DAS J.-This appeal arises out of an application
Das J.
made by the Respondent under the Indian Arbitration
Act, 1940, praying inter alia that the arbitration
agreement contained in certain contract notes including contract note No. 17996 sent by the Appellants to
the Respondent be declared to be invalid, void and
unenforceable and be set aside and that a purported
award made by the arbitrators appointed in terms of
the said contract notes be set aside. That application
came to be made in the following circumstances :
The Appellants were and are members of the East
India Cotton Association Ltd. The Respondent, however, was not and is not a member of that Association.
In April, 1945, the Respondent employed the Appellants
as his agents to effect forward contracts for the sale
and/or purchase of cotton according to the rules, regulations and bye-laws of that Association. Between the
9th April, 1945, and the 10th August, 1945, the Appellants as such agents put through various contracts for
sale and/or purchase of cotton for July, 1945, and
September, 1945, deliveries and sent to the Respondent
66
SUPREME COURT REPORTS
[19M)
• 19llO
contract notes in respect of each of such contracts.
All the said contract notes were in printed forms, a
M;"'"s: K:i;J• specimen copy whereof is set out at pages 12 to 15 of
"""':.
o.
the Paper Book. On the 10th August, 194?, the pursh,; &ldev Das chase of 900 bales of cotton at Rs. 432 per candy for
c. Parikh.
September 1945 delivery remained outstanding. According to the Respondent, on the 11th August, 1945,
Das J.
the Respondent instructed the Appellants to close the
said outstanding purchase by selling 900 bales for
September 1945 delivery at a rate not less than Rs. 426
per candy, which is said to be the prevailing market
rate on that date. As the Respondent did not receive
any contract note from the Appellants in respect of the
closing transaction of900 bales, the Respondent on the
18th August, 1945, put on record his aforesaid instructions and asked the Appellants to send the contract
note.
The Appellants, however, deny that any instruction was given by the Respondent on the 11th
August, 1945, for closing the outstanding contract.
They deny the receipt of the Respondent's letter of that
date. According to the Appellants the 21st August,
1945, was a clearing date and on that clearing a sum
of Rs. 18,900 became due and payable by the Respondent to the Appellants and that instead of paying up
his dues the Respondent concocted the false story of
having given instructions to the Appellants to close the
outstanding purchase. The Appellants by their letter
of the 22nd August, 1945, repudiated the allegations
in the Respondent's last mentioned letter and called
upon the Respondent to pay up Rs. 18,900 and gave
notice to him that if he failed to pay up the amount by
noon of the 23rd August, 1945, the Appellants would
be compelled to square up the outstanding contract at
their discretion on account and at the risk of the Respondent. The Respondent on the 24th August, 1945,
denied having fabricated any false story and repudiated liability for Rs.18,900 and returned the Appellants'
bill. On the 27th August, 1945, the Appellants closed
the outstanding contract for purchase of 900 bales by
selling the same at Rs. 356 per candy for September,
1945, delivery and along with their letter dated the
27th August, 1945, sent contract note No. 17996. The
-
••
S.C.R.
SUPREME COURT REPORTS
67
Respondent by his letter dated the 28th August, 1945,
reiterated the story of previous instruction for closing
lllllO
Messrs. KMmji
the contract, denied having given any instruction to
Poonja 6- ca.
the Appellants to close the contract on the 27th August,
v.
1945 and returned the contract note No. 17996. On Shri Balde" Das
'
.
the 28th August, 1945, the Appellants wrote to the
c. Par.ltlt.
Respondent claiming Rs. 34,313 and expressing the
desire to refer the disputes to arbitration in terms of
the arbitration agreement contained in the contract
notes. Both parties appointed their respective arbitrators. The arbitrators entered upon the reference and
eventually fixed the 24th October, 1945, for a meeting of
the arbitrators. The Respondent alleges that he received
the notice of meeting only on 22nd October, 1945, and
could not attend the meeting on the 24th October, 1945,
as he had to appear before the Income Tax Officer on
the same day. Accordingly, the Respondent sent his
agent to attend the arbitration meeting and to obtain
an adjournment. The arbitrators, however, rejected
the application for adjournment and made an ex parte
award on the same day for Rs. 34,313 and interest and
cc;:;ts.
Being aggrieved by the award the Respondent
on the 10th November, 1945, filed 1'n appeal to the
Board of the Association. The Respondent's allegation
is that pending the said appeal he discovered that the
contract notes rendered by the Appellants from time to
time including the contract note No. 17996 were not
in accordance with the prescribed official form of contract notes of the Association and he was advised that
in the premises the contracts were void under the pro-:
visions of the Bombay Cotton Contracts Act (IV of
1932) and that, that being so, there was no arbitration
agreement between the parties under which there could
be any reference to arbitration on which any award
could be made.
The Respondent thereupon amended
his memorandum of appeal to the Board pointiug out
the invalidity of the contracts and at the same time
made a substantive application to the High Court
under the Indian Arbitration Act for the reliefs already
summarised above.
In order to appreciate the rival contentions of the
parties it is necessary to refer to the relevant
Das},
19~
Meurs. Khimji
Poonja &- Co.
T,
Sh~i Baldev Das
C. Parikh.
Das J.
,
'
68
SUPREME COURT REPORTS
[1950]
provisions of the Bombay Cotton Contracts Act, 1932,
and the bye-laws of the said Association.
Section (8) (i) of the Bombay Cotton Contracts Act,
1932, runs as follows :-
"Save as hereinafter provided in this Act any contract (whether either party thereto is a member of a
recognised cotton association or not) which is entered
into after the date on which this Act comes into
operation and which is not in accordance with the byelaws of any recognised cotton association shall be
void."
There is no dispute that the East India Cotton Association is one of the recognised cotton associations for
the purposes of the said Act. Bye-laws 80 and 82 of
that Association are in the terms following :-
"80. Delivery Contracts between members shall be
made on the Official from giv,en in the Appendix.
Hedge Contracts between members may be verbal or in
writing and when in. writing shall be in one or other of
the forms given in the Appendix. Whether verbal or
written all contracts shall be subject to the bye-laws,
provided that in the case of Delivery Contracts ByeJaws 149 to 163 inclusive shall not apply.
82. Contracts between members acting as commission agents on the one hand and their constituents on
the other shall be made subject to the bye-laws and a
contract note in the form given in the Appendix (pages
92; 93, 94 and 95) shall be rendered in respect of every
such contract. Bye-laws 130 to 166 (inclusive) shall
not apply to these con tracts."
Bye-law 51-A originally required a deposit at a rate
not less than Rs. 25 per bale and accordingly the contract note submitted by the agent to the constituent
used to contain the following clause at the end of the
clause relating to payment of margin:-
"In addition to the above, the deposit (not carrying
interest) payable under bye-law 51-A, namely, at arate
not less than Rs. 25 per bale shall, when demanded, be
made by you to·me/us in Bombay."
During the war bye-law 51-A was amended by reducing the minimum amount of deposit from Rs. 25 per
j
S.C.R.
SUPREME COURT REPORTS
69
l9IKI
bale to Rs. 12-8-0 per bale and accordingly the Government of Bombay by a Notification made on the i9th Sepb
1945 ·
'
f h
r
db
h
Messrs. Khimji
tem er,
, m exermse o t e powers con1erre
y t e
P
. Ii- Co
Bombay Options in Cotton Prohibition Act, 1939 (Act
00
"':.
•
XXV of 1939) provided that the contract note should Shri Baldcv Das
also be amended so that the clause last quoted above
c. Parikh.
should read as follows:-:-
" In addition to the above, the deposit (not carrying
in.terest) payable under bye-law 51-A, namely, at a rate
not less than Rs. 12! per bale shall, when demanded,
be made by you to me/us in Bombay."
In order to enforce war-time controls another amend·
ment of the bye-laws was made whereby a new
bye-law was added as bye-law 65-A. In view of this
last mentioned amendment and in order to bring the
contract note between the agent and the constituent
into line with this new bye-law the Government of
Bombay by the same Notification dated the 19th September 1944 directed the i11clusion of the two following
clauses in the contract note, namely :
"If this contract is a co,ntract for sale, then if
between us and other members of the East India Cotton
Association we become, under the bye-laws, the first
seller of the cotton so sold and if the last buyer exercises the right given by bye-law 65-A, you will then be
bound by the provisions of that bye-law as between
you and us.
If this contract is a contract of purchase, and if between us and other members of the East India Cotton
Association Ltd., we become the last buyers unless we
shall have received express instructions from you in
writing to the contrary, before the commencement of
the delivery period if the contract is entered into before
the commencement of the delivery period, or with the
order if the contract is entered into during the permitted days of trading in the delivery period, we shall be
at liberty at our option and without any further reference to you to exercise the right given to the last buyer
under bye law 65-A, and if we so exercise the right you
will be bound by the provisions of that bye-law as
between you and us."
Das).
70
SUPREME GOUR r REPORTS
[1950]
After all these amendments the contract note to be
rendered by art agent to the constituent had to be in
Musrs. Khimji the form, a specimen copy whereof is set out at pages
Poonja 6- Co,
•.
17 and 18 of the Paper Book. The contracts between
19150
Shri Baldev Das the Appellants and the Respondent were made after the
c. Parikh.
aforesaid contract note form came into vogue.
The
Das J.
official Contract Note form to be used after the aforesaid amendments opens with the following clause:-
" I/we have this day sold/bought for you in Bombay
subject to the following conditions and to the Bye-laws
of the East India Cotton Association Ltd., in force from
time to time and subject also to my /our usual charges
and terms of business as Commission Agents."
Then are inserted particulars of the description,
quantity, price etc., of the cotton which is the subjec_tmatter of the contract.. Then follows the clause for
payment of margin, the last sentence of which provides
for payment of deposit payable under bye-law 51-A as
amended, namely, at a rate not less than Rs. 12! per
bale. At the end of the form are to be found the two
new clauses required to qe incorporated in every Contract Note by the Government Notification already
referred-to.
The Contract Notes actually rendered by the Appellants to the Respondent, however, were in forms, a
specimen copy whereof is set out at pages 12-15 of the
Paper Book. A comparison of the two forms of the
contract notes will reveal the following differences:-
(1) In the contract note rendered by the Appellants
to the Respondent the last sentence providing for deposit at the end of the margin clause is missing. There is,
however, a rubber stamp impression on the top of the
back of the contract to the following effect:-
"In addition to the above, the deposit (not carrying interest) payable under bye-law 51-A, namely, at a
rate not less than Rs. 25 pe: bale shall, when demanded,
he made by you to me/us m Bombay."
Evidently, this rubber stamp provision is a reproduction of the sentence that used to be found at the
end of the margin clause before bye-law 51-A was
amended and the clause itself was amended by the
Government Notification of 1944.
S.C.R.
SUPREME COURT REPORTS
71
(2) The two new clauses required to be ineerted in
the contract referred to above have also been omitted.
1960
Messrs. Khimji
The contention of.the respondent was that the conP()()nja & co.
tract notes actually issued were not in accordance with
v.
the bye-laws of the Association and were accordingly Shri Balde_v Das
void under Section 8 of the Bombay Cotton Contracts
c. Parikh.
Act, 1932, and that, that being so, the arbit.ration agreeDas J.
ment incorporated in the contract note was also void
and there could be no reference to arbitration and there
could be no award as purported to have been made by
the arbitrators on a reference under the void contracts.
The matter was dealt with by Mr. Justice Chagla
who overruled the contentions of the Respondent and
dismissed the application on 2nd July 1946.
The
learned Judge pointed out that whereas bye-law 80
required that delivery contracts must be made on the
official from and that the hedge contracts, when made in
writing, must be made in the form given in the Appendix, clause 82 did not require that the eon.tracts between members acting as commission agents on the
one hand and their constituents on the other must be
in writing or in particular form.
According to the
learned Judge bye-law
82
required two things,
namely:-
(i) that the contracts referred to therein should be
made subject to the bye-laws, and
(ii) that a contract note in the prescribed torm
should be re'ndered in respect of every such contract.
The learned Judge was of the opinion that section 8
of the Bombay Cotton Contracts Act, 1932, only avoided the contracts in case of contravention of the first
requirement, namely, if the contracts were not made
subject to the bye-laws, but had no concern with the
contravention of the second requirement, namely, if
the contract notes were not in the prescribed form. The
learned Judge appears to have made a distinction between a contract and a contract note.which wail a mere
evidence of the contract. According to him, even if the
contract note was not in the prescri~ed form, that fact
did not affect the pre-existing contract which had only
to be made subject to the bye-laws but need not have
10
1960
Alcssrs. J{hiniji
Poonja {:; Co.
v.
Shri Baldev Das
C. Parikli.
/)as}.
72
SUPRE~IE COURT REPORTS
[1950]
been made in writing at all. Accordingly, the learned
Judge dismissed the a pplica ti on.
Being aggrieved by that deeision, the Re&pondent
went up on appeal which was heard by Stone C.J. and
Coyajee J. who accepted the appeal, set aside the dismissal of the Respondent's petition and gave the
declaration prayed for and set aside the award. The
Appellants have no~ come up on appeal before us after
having obtained the necessary certificate from the
Bombay High Court.
We find ourselves in agreement with the decision
of the appellate Court. Ordinarily, when a contract
between the parties i8 reduced to writing, the writing
becomes the repository of the contract and that writing
only can be looked at to ascertain what the contract
between the parties is, and if that writing is not in accordance with the bye-laws, the contract itself must be
void. We do not, however, feel pressed to emphasize
this aspect of the matter, for, assuming tha.t there was
a pre-existing oral contract between the parties dehors
the written contract note, .as held by Chagla J. we
have yet to see whether the so-called pre-existing oral
contract was iri accordance with the bye-laws, for if it
were not, then it would be hit by section 8of the Bombay Cotton Contracts Act, 1932.
There is no suggestion that the terms of the so-called pre-existing oral
contract were in any way different from the terms
subsequently recorded in the contract notes actually
issued.
In the first place we find that the last sentence in the
margin clause, in order to be in accordance with the
bye-laws, should have been as follows:-
"In addition to the above, the deposit (not carrying
interest) payable under bye-law 51-A, namely, at a
rate not less than Rs. 12! per bale shall, when demanded, be made by you to me/us in Bombay."
Instead of that sentence, we have the rubber stamp
impression reading as follows:-
"In addition to the above, the deposit (not carrying
interest) payable under bye-law 51-A, na.mely, at a
I
S.C.R.
SUPREME COURT REPORTS
73
rate not less than Rs. 25 per bale shall, when demand1950
ed, be made by you to us in Bombay."
Messrs. Khitnji
The respondent contends that this term is not in
Poonja & eo.
accordance with the bye-laws of the Association. The
v.
Appellants on the other hand contend that there is no Shri Bald•." Das
discrepancy, because a provision for a rate not less
c. Parikh.
than Rs. 25 per bale does not contravene or is not inDas 1.
consistent with the provision for a rate not less than
Rs. 12! per bale. In other words, any rate above the
rate of Rs. 12! may be stipulated in accordance with
the terms of business to which the contract was subject, for it did not contravene the requirement that the
rate should not be less than Rs. 12!. It is true that the
opening clause of the contract note makes the contract
subject to the Appellants' usual charges and terms of
business, but the contract is at the same time subject to the bye-laws of the Association. In order to
reconcile the two, such terms of business as are not
inconsistent with the bye-laws can only be permitted
to prevail. The rubber stamp provision clearly imposes on the respondent as the constituent the liability
to deposit a higher amount as the minimum amount to
be deposited and is to that extent not in accordance
with bye-law 51-A. Apart from this consideration
there is another serious objection to the rubber stamp
provision. The language of that rubber stamp provision clearly indicates that it purports to summarise
and set out what is payable under bye-law 51-A.
In fact, as already stated above, bye-law51-A had been
amended and what is payable under the amended
bye-law is not at a rate not less than Rs. 25 but
at a rate not less than Rs. 12!. Therefore, the rubber
stamp provision wrongly summarises and sets out the
provisions of bye-law 51-A and consequently is not in
accord.ance with that bye-law.
The contention of the Respondent has been and is
that by reason of the omission of the two clauses at the
end of the contract note actually issued by the Appellants it was not in accordance with the bye-laws. The
learned Attorney-General appearing for the Appellants
contends that the contract was expressly made subject
74
SUPREME COURT REPORTS
(1950]
19!50
to the bye-laws and, therefore, the provisions of ~he
new bye-law 65-A were by reference incorporated in
Messrs. Khimji
Poo .. ja & co.
the contract. This contention, we are satisfied, is
v.
unsound. Bye-law 65-A in terms regulates the relaSh•i Balde• Das tionsbip between members and incorporation thereof in
c. Pa•ikh.
a contract between a member agent and an outsider
Das J.
constituent will make no sense and on a plain re~ding
will be meaningless. Further, under bye-law 65-A
the last buyer has certain options. The outstanding
contract being one for purchase of 900 bales, the
Appellants, if they became the last buyers, could,
under that bye-law, exercise any of those options at
their own discretion. In the second of the two clauses
which have been omitted from the contract note this
option has been made subject to express instructions of
the constituent to the contrary, for it provides that
the Appellants as agents would be free to exercise their
option-
" unless I/We shall have received express instructions from you in writing to the contrary before the
commencement of the delivery period if the contract is
entered into before the commencement of the delivery
period or with the order if the contract is entered into
during the permitted days of trading in the delivery
period."
By reason of the omission of the two clauses, this right ·
of the respondent as constituent is not made a term of
the contract between the parties. It follows, therefore,
that the so-called pre-existing oral contract is not in
accordance with the bye-laws on this ground also.
For reasons stated above, this appeal fails and must
be dismissed with costs.
PATANJALI SASTRI J.-I agree that this appeal
should be dismissed with costs, but I would prefer to
rest my decision solely on the ground of the omission
to include in the contract in question the two clauses
newly added in the prescribed form in order to give
effect to bye-law 65-A.
Appeal dismissed.
Agent for the appellants: Rajinder Narain.
Agent for the respondent: M. S. K. Sastri.