As per section 10 of Indian Contract Act- 1872, essentials of a Valid Contract are:
a) A valid agreement (which includes an offer/ proposal and its proper acceptance
b) Free consent of parties
c) Parties must be competent to contract,
d) Consideration and the object must be lawful, and
e) Such an agreement must not be expressly declared to be void.
Hence, amount extracted under coercion should be refunded. Case law referred in ICAI study material (for IPCC) Trikamdas Udeshi vs Bombay Municipal Corporation on 19 November, Bombay High Court, 1953
Facts of the case:
The petitioner boarded a tramcar belonging to the Bombay Electric Supply & Transfer Undertaking of the Bombay Municipality at Crawford Market and got out at Bori Bunder without purchasing a ticket. He was thereupon called upon by the Traffic Supervisor to pay a sum of Rs. 5 as penalty. The petitioner paid the fine and obtained a receipt for it from the Supervisor. He then filed a suit in the Small Causes Court to recover this amount as having been paid under coercion. The Small Causes Court dismissed the suit. Revision application was made to the HC.
Trikamdas Udeshi claimed that the fine amount- Rs 5/- was paid under coercion. He also contended that General Manager had no power to delegate the power to the Traffic Supervisor. Even if he had the power, the delegation was illegal. That, he had committed a non-compoundable offence by failing to purchase a ticket for travelling in the tram-car, and the Municipality had no power in law to compound a non-compoundable offence.
What was the coercion- in the instant case?
The petitioner paid this sum in order to avoid a prosecution. He knew perfectly well that if he did not pay this sum of Rs. 5, he would have been prosecuted before a Magistrate and could have been fined with further embarrassment.
While setting aside the ruling of the lower court the HC listed the following rationale`:
Attention was also drawn to Section 113 of the Railways Act, which empowers a railway servant to demand the requisite amount from a person travelling in a train without a ticket and on the failure or refusal to pay by the passenger the amount can be recovered by an application to a Magistrate. It was suggested that a similar provision could be made in the Municipal Act.
The learned Judge stated that this case raised a question of great public importance, which is of grave consequence to the public at large in the city of Bombay. Hence a decree in favour of the petitioner for Rs. 5, with costs of the suit was passed.
IMHO:
Equating a just penalty as coercive extraction under the guise of legal technicalities does not create a good precedent. However, lets also remember that, primary duty of the judges’ is to interpret the Law and not to legislate; so if there is a legal loophole then they may plead helplessness. Again, in a just society, the judges of the higher judiciary are considered as dispenser of justice and not mere score keepers and mute spectators. With the increased judicial activism evidenced today, I doubt this judgment would stand today’s critical scrutiny.
I may’ve grossly missed out on relevant facts, yet from the available literature/ facts (in the public domain) I fail to understand why the above case law was chosen by the BOS – of ICAI- to illustrate a case of coercion, when there are enough other cases to drive home the point in a very straight forward manner.
a) A valid agreement (which includes an offer/ proposal and its proper acceptance
b) Free consent of parties
c) Parties must be competent to contract,
d) Consideration and the object must be lawful, and
e) Such an agreement must not be expressly declared to be void.
Hence, amount extracted under coercion should be refunded. Case law referred in ICAI study material (for IPCC) Trikamdas Udeshi vs Bombay Municipal Corporation on 19 November, Bombay High Court, 1953
Facts of the case:
The petitioner boarded a tramcar belonging to the Bombay Electric Supply & Transfer Undertaking of the Bombay Municipality at Crawford Market and got out at Bori Bunder without purchasing a ticket. He was thereupon called upon by the Traffic Supervisor to pay a sum of Rs. 5 as penalty. The petitioner paid the fine and obtained a receipt for it from the Supervisor. He then filed a suit in the Small Causes Court to recover this amount as having been paid under coercion. The Small Causes Court dismissed the suit. Revision application was made to the HC.
Trikamdas Udeshi claimed that the fine amount- Rs 5/- was paid under coercion. He also contended that General Manager had no power to delegate the power to the Traffic Supervisor. Even if he had the power, the delegation was illegal. That, he had committed a non-compoundable offence by failing to purchase a ticket for travelling in the tram-car, and the Municipality had no power in law to compound a non-compoundable offence.
What was the coercion- in the instant case?
The petitioner paid this sum in order to avoid a prosecution. He knew perfectly well that if he did not pay this sum of Rs. 5, he would have been prosecuted before a Magistrate and could have been fined with further embarrassment.
While setting aside the ruling of the lower court the HC listed the following rationale`:
Attention was also drawn to Section 113 of the Railways Act, which empowers a railway servant to demand the requisite amount from a person travelling in a train without a ticket and on the failure or refusal to pay by the passenger the amount can be recovered by an application to a Magistrate. It was suggested that a similar provision could be made in the Municipal Act.
The learned Judge stated that this case raised a question of great public importance, which is of grave consequence to the public at large in the city of Bombay. Hence a decree in favour of the petitioner for Rs. 5, with costs of the suit was passed.
IMHO:
Equating a just penalty as coercive extraction under the guise of legal technicalities does not create a good precedent. However, lets also remember that, primary duty of the judges’ is to interpret the Law and not to legislate; so if there is a legal loophole then they may plead helplessness. Again, in a just society, the judges of the higher judiciary are considered as dispenser of justice and not mere score keepers and mute spectators. With the increased judicial activism evidenced today, I doubt this judgment would stand today’s critical scrutiny.
I may’ve grossly missed out on relevant facts, yet from the available literature/ facts (in the public domain) I fail to understand why the above case law was chosen by the BOS – of ICAI- to illustrate a case of coercion, when there are enough other cases to drive home the point in a very straight forward manner.
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