Madhub Chunder poramanik Vs.

Rajcoomar Doss and Others==================(1874)

14 Benj LR 76

A.INTRODUCTION

This case as decided by the High Court of Calcutta, assume the impact of Contract Act IX of 1872,
rotates around restraint of trade and protection of trade and commerce. The facts offering ascend to
this intrigue are, generally, undisputed and the reason for conflict between the party places round the
short point regarding whether an contract for incomplete or absolute limitation on exchange of
merchandise as released and reached a conclusion by reason of certain supervening conditions which
influenced the exhibition of its material piece. Through this short paper looking into the issue of
Madhub Chunder Poramanik V Rajcoomar Doss and others, it is unmistakably expressed that section
27 is pulled in whether the restraint is partial or complete.

Hon'ble Judges a decision about Sir Richard Couch, Kt., C.J. what's more, Pointifex, JJ held that the
offended party held no option to recoup the cash which he asserted. It was guided in the judgment to
be entered for the defendent with the expenses of suit, including the expenses of reserving and
contending this case.
B.SIGNIFICANCE OF THE CASE

The principle impotance of the case was from the utilization of "absolutely" in Section 28, which deal
the restraint of lawful procedures . As this word is absent from Section 27, along these lines, the
conclusion, that it was expected to forestall not only an all out restriction but rather likewise halfway
limitation yet in addition an incomplete restriction. This translation of the segment has been
commonly acknowledged. "The area has the section has abolished the distinction between partial and
total restraint of trade.

The issue raised is " Whether the restraint is general or partial, unqualified or qualified, if the
agreement is in the nature of a restrain trade, it is void”

In this manner, a agreement to close a business for 3 months in a year , an understanding that one
gathering would sell hamburger for 14 days in a month and other for rest of the month have been held
void by the court.

C. FACTS OF THE CASE

In this case the parties to the contract carried on business as braziers in a certain part of
Calcutta. As the mode of the business of the plaintiff was found by the defendants to be
detrimental to their business interest, an agreement was entered into between the plaintiff and
the defendants whereby the plaintiff agreed to stop his business in that quarter and the
defendant promised in consideration of his doing so to pay the plaintiff all the sums which he
had then distributed as advance to the workers. In terms of the agreement the plaintiff ceased
carrying on the business in that quarter, but the defendants failed to perform their part of the
contract, namely, to pay to the plaintiff all the sums which the plaintiff had advanced to their
workmen.

The plaintiff therefore sued to recover from the defendants Rs. 900 being the amount
advanced by him to their workmen. It was held by the High Court that the agreement was
void under section 27 of the Indian contract act even though the restriction put on the
plaintiff’s business was limited to a particular location. The plaintiff’s suit failed on the
ground that when the agreement on the part of the plaintiff was void, there was no
consideration for the agreement on the part of the defendants to pay the money and the whole
contract was to be treated as one which could not be enforced.
D. ISSUES

Whether the restraint is general or partial, qualified or unqualified, if the agreement is in the
nature of a restraint of trade, it is void.

E. JUDGEMENT

Sir Richard Couch J.

Kt., C.J. furthermore, Pointifex J.

Divisional seat

Calcutta HC

According to a classic interpretation by Sir Richard Couch in one of the earliest judicial
interpretations of the statute, Section 27 covers both complete and partial restraints. “The
words ‘restraint from exercising a lawful profession, trade or business’ do not mean an
absolute restriction, and are intended to apply to a partial restriction, a restriction limited to
some particular place, otherwise the first exception would have been unnecessary. Moreover,
in the following Section 28 the legislative authority when it intends to speak of an absolute
restraint and not a partial one, has introduced the word ‘absolutely’ The use of this word in
Section 28 supports the view that in Section 27 it was intended to prevent not merely a total
restraint from carrying on trade or business, but a partial one. We have nothing to do with the
policy of such a law. All we have to do is to take the words of the Contract Act, and put upon
them the meaning which they appear plainly to bear. The learned judge drew support from
the word ‘absolutely’ in section 28, which deals with restraint of legal proceedings. As this
word is absent from section 27, therefore, he concluded, that it was intended to prevent not
merely a total restraint but also a partial restraint. The section has abolished the distinction
between partial and total restraints of trade.

In addition, in the accompanying Section 28 the administrative power when it expects to discuss a flat
out restriction and not a fractional one, has presented the word 'completely' The utilization of this
word in Section 28 backings the view that in Section 27 it was proposed to keep not only an all out
limitation from continuing exchange or business, however an incomplete one. We don't have anything
to do with the approach of such a law. We should simply to take the expressions of the Contract Act,
and put upon them the significance which they show up obviously to tolerate. The took in judge drew
support from the word 'completely' in segment 28, which manages restriction of legitimate
procedures. As this word is missing from area 27, along these lines, he finished up, that it was
proposed to forestall not simply an all out restriction but rather likewise a halfway limitation. The area
has nullified the differentiation among halfway and complete limitations of exchange.

The Case has become the 'locus classicus' regarding this matter. The perceptions were:" The words
'restrain from practicing a lawfull profession trade or business' don't mean an partial restriction, and
are expected to apply to an incomplete limitation, a limitation constrained to some specific spot, in
any case the principal exemption would have been pointless .' Moreover, 'in the accompanying
Section (Section28) the authoritative position when it plans to discuss a flat out restriction and not a
fractional one, has presented the word 'absolutely'.... The use of this word in Section 28 supports
the view that in Section 27 it was intended to prevent not merely a total restraint from
carrying on trade or business, but a partial one. We have nothing to do with the policy of such
a law. All we have to do is to take the words of the Contract Act,1872 and put upon them the
meaning which they appear plainly to bear."
F. ANALYSIS & PERSONAL COMMENTS

The words 'restraint from exercising a lawful profession, trade or business' do not mean an
absolute restriction and are intended to apply to a partial restriction, a restriction limited to
some particular place, otherwise the first exception would have been unnecessary. In addition,
in the accompanying section 28 of Contract Act, 1872 the administrative power when it means to talk
about a flat out limitation and not a halfway one, has presented the word 'completely' the utilization of
this word in area 28 backings the view that in section 27 it was proposed to keep not only an all out
restriction from continuing exchange or business however a fractional one. We don't have anything to
do with strategy of such a law. We should simply to take the expressions of the Contract Act, and put
upon them the significance which they show up clearly to hold up under. The case, as expressed,
expect that Act IX of 1872 applied, and when the case was first contended before as, no inquiry was
raised with regards to the utilization of that Act, be that as it may, accordingly, when the judgment
was going to be conveyed, it was called upon the inquiry which had been expressed for the situation,
it was submitted to us that the Act didn't have any significant bearing in the Small Cause Court to an
instance of this sort between Hindus. That the law as it was before the Act was passed proceeded with
relevant, and the case was represented by, Hindu law.

The decision by the court was rightly taken and as expected came under the ambit of the ICA
itself. The court did not presume the things; it went all on facts, circumstances and evidences
provided. The case reflected a good law and doesn’t tumble down the provisions of ICA
henceforth. The method of evaluating the decision of the court was systematic; it also took
the help of Indian cases and theories propounded by the Indian jurists while analyzing its
decision. Henceforth, I would say the court properly analyzed its circumstances and
everything in set order.

G. CASES SITED

H. EFFECT OF THE JUDGEMENT

Freedom of trade and commerce is a right protected by the Constitution of India. Just as
Legislature cannot take away individual freedom of Trade, so also the individual cannot
barter it away by an agreement. The principle of this: Public policy requires that every man
shall be at liberty to deprive himself, and shall not be deprive himself or the State of his
labour , skill or tallent , by any contact that he/ she enters into." "Every man own and the
community's benifit". Therefore Section 27 declares the plain terms that an agreement by
which one is restrained from exercising is void.

Therefore, the word "lawful profession" in Section 27 includes both an independent

professional and a salaried professional. Self employment and all modes of economic suvival
or of earning one's livelihood are covered.======================Electrosteel Casting
Ltd. v. Saw Pipes Ltd., (2005) 1 CHN 612
I. CONCLUSION

Agreement law,1872 so far as that is concerned, business law by and large, must mull over the acts of
business and law must be elucidated by the governing body and the courts to execute the business
choices between consensual gatherings. Thus, the ideas of agreement law and their lawful results
ought to in a perfect world speak to strategic approaches as was right now, the obvious aim of the law
is to a protected a particular outcome. The offended party held no option to recoup the cash which he
guaranteed. It was guided in the judgment to be entered for the respondents with the expenses of suit,
including the expenses of saving and contending this case.