Common Relief

Suit for interest by way of damages and special damages:

The seller or the buyer shall have the right to recover interest or special damages in any case where by law, interest or special damages may be recoverable, or to recover the money paid where the consideration fort he payment of it has failed.

In the absence of a contract to the contrary, the Court may award interest at such rate as it thinks fit on the amount of the price:

1) to the seller, in a suit by him for the amount of the price from the date of the tender of the goods or from the date on which the price was payable;
2) to the buyer, in a suit by him for the refund of the price in case of a breach of the contract on the part of the seller from the date on which the payment was made.
The provisions of section 61 can be summarized in the following rules:

i) Interest shall be payable in cases where by law it is recoverable
ii) Interest shall be payable at such rate as the Court may think fit.
iii) Interest may be awarded to the seller>

a) if there is contract, then according to the contract
b) if there is no contract, at such rate as the court thinks fit from the date of tender of the goods or from the date on which the price was payable. It must be noted that where there is no contract between the parties regarding payment of interest, plaintiff is not entitled to such a claim.

iv) Interest may be awarded to the buyer —
a) if there is a contract, then according to the contract;
b) if there is no contract, at such rate as the Court thinks fit from the date on which the payment was made.
v) Interest may be awarded under section 80 of the Negotiable Instruments Act
vi) Interest prior to the suit may be awarded under following circumstances –

a) if there is agreement to pay interest at a fixed rate;
b) if it is payable by usage of trade;
c) if it is payable under the provisions of substantive law.

The court is competent to grant interest against the defendant for the period prior to the institution of the suit.

vii) If the goods are sold on credit, interest will be awarded from expiry o the credit.
viii) No interest can be recovered on damages

It should be noted that special damages are awarded according to the provisions of section 73 of the Indian Contract act, for example, special damages are allowed when breach of a contract occasionally a special loss was actually in contemplation of the parties at the time of entering into the contract.

Either party is also entitled to recover the money paid where the consideration for which it was paid has failed, for example, where seller has no title to the goods, buyer is entitled to recover the price paid as consideration for which the price was paid has failed.

Auction sales:

Section 64 of the Act lays down the following rules governing the auction sales –

1) The sale is complete when the auctioneer announces its completion by the fall of the hammer or in other customary manner. ‘
2) A bidder is at liberty to withdraw his bid at any time before it is accepted by the auctioneer.
3) The auctioneer likes not bound to sell articles advertised to the highest bidder except when the sale is with reserve.
4) The auctioneer is not bound to hold auction on the date of advertisement. His advertisement is not an offer but a mere invitation.
5) The auctioneer has the right to make the auction subject to any conditions he likes.
6) A condition in an auction sale the “biddings once made cannot be withdrawn” is not enforceable. The bidding can be withdrawn before acceptance.
7) In case of goods put up for sale in lots, each lot is prima facie deemed to be the subject of a separate contract of sale.
8) A right to bid by reserved expressly by or on behalf of the seller. Where such right is expressly reserved, the seller or any person on his behalf may bid at the auction.
9) No seller or nay person who has advertised can bid at an auction sale, unless the right is expressly reserved and notified, otherwise any such sale be treated as fraudulent by the buyer.
10) Agreements not to bid against each other are called “Knockout agreements” and they are not unlaw4ful. The seller may protect himself by a ‘reserve’ bid.
11) If the seller makes use of pretended bidding to raise the price, the sale is voidable at the option of the buyer.
12) Reserve price: the sale may be notified subject to a reserve or upset price. For example, there may be a price below which the goods will not be sold. The reserve price may be kept secret.
13) Where the auctioneer discloses the fact that he is acting as an agent, but does not disclose the names of his principal and sells specific goods, the principal’s title to the goods is not lost.
14) If the sale is through the court, it would be subject to the conformation of the court.

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