- (1.) The suit, which culminated into this second appeal, was instituted by the respondents against the appellants for rendition of accounts and for recovery of the amount that would eventually be found due to them on taking such accounts from them (the appellants).
(2.) Their case was that their firm was of Hindu Joint family and the appellants had been manufacturing cloth and they (the appellants) had appointed them in the month of November, 1955, as sole agents to effect the sales of their cloth in district Mohindergarh and Rajasthan. It was averred that they were to get commission at the rate of Rs. 7/13/- per cent on the price of cloth sold by the appellants either through them or directly in the aforesaid area i.e, district Mohindergarh and Rajasthan, and in addition to the said commission they were entitled to get Rs. 1/12/- per cent on the value of the cloth as expense for supply of the same in the villages, and they were also to get one scissor, a calendar and a Jhola to be supplied by them to the customer purchasing 10 pieces of cloth at a time. It was maintained by the respondents that they had worked as agents of the appellants on the said terms till August 30, 1960, when they had terminated the agency by serving a registered notice on them (the appellants). It was averred by them that full accounts of the commission were with the appellants and the amount of commission could not be worked out in the absence of the said accounts and as the appellants had filled to pay the amount of commission due to them they brought the suit for the reliefs stated above. The suit was resisted by the appellants. The fact that Rameshwer Dayal respondent was appointed as agent for effecting the sale of the cloth of the appellants was admitted. The other material allegations were, however, controverted and it was pleaded, inter alia, that the suit was not maintainable, that it was barred by time and was not cognizable by the civil Courts at Narnaul, and that the respondents had misconducted in the business of agency. Hence, the suit was tried on the following issues :- 1. Whether the plaintiff is a joint Hindu Family Firm and Shri Rameshwer Dayal is a Karta thereof. If not, to what effect ? 2. What were the terms and duration of agency ? O.P. 3. Whether the plaintiffs suit as framed for rendition of accounts is maintainable against their defendant-principals ? 4. Whether this Court has jurisdiction in this suit ? O.P.P. 5. Whether the suit is time-barred ? O.D. 6. Whether the plaintiffs have misconducted in any agency transaction, if so, to what extent and effect ? 7. Relief. The trial Court decided issue Nos. 1 and 4 in the affirmative and it decided issue No. 5 against the defendants (now the appellants). It held under issue No. 2 that thee plaintiffs (now the respondents) had acted as agents on the terms as stated by the defendants (now the appellants). It decided issue No. 3 in the negative and issue No. 6 in the affirmative and dismissed the suit. The plaintiffs (now the respondents) carried appeal to the District Judge, Sangrur, who reversed the finding recorded by the trial Court in issue No. 3 and decided it in the affirmative, and concluded the terms and conditions of the agency in para 14 of the judgment. He held under issue No.6 that the question of misconduct by the plaintiff-respondents would be gone into at the time of taking the accounts and that the suit could not be dismissed on their alleged misconduct. He affirmed the findings of the trial Court on the other issues and passed a preliminary decree or rendition of accounts in favour of the plaintiffs against the defendants. Aggrieved by the said decree, the defendants have appealed.
(3.) The learned counsel for the appellants attacked the decree recorded by the learned District Judge with the contentions that the suit being for rendition of accounts by an agent against the principal was not maintainable, that the respondents were not entitled to any commission on the sales of cloth which had been supplied to the customers directly by the appellants, and that the respondents and rendered themselves incompetent to accounts, because they had been guilty of misconduct in realising the money, which had been due to them (the appellants) from their customers, without their consent. In my opinion, none of the said contentions is well-founded and there is no force in the attack directed by the learned counsel for the appellants against the judgment and decree of the lower Appellate Court. It is true that Section 213 of the Contract Act gives a statutory right to the principal. But that statute is not exhaustive and the right of the agent to sue the principal for accounts is an equitable right, which may arise under special circumstances and the denial of which may result into miscarriage of justice which may not be permitted. Such a right arises where all the accounts are in possession of the principal and the agent does not possess accounts to enable him to determine his claim for commission correctly. His right may also arise in exceptional circumstances where his remuneration depends to the extent of dealings which are not know to him, and where he cannot be aware of the extent of the amount due to him unless the accounts of his principal are gone into such was observation made by the Supreme Court in Narandass Morardas Gajiwala and others v. M. Papammal and other, 1967 AIR(SC) 333;