' MUHAMMAD ASADULLAH, J.--The respondent, WAPDA, placed an order for the supply of 22,800 wooden meter boards of different sizes at different rates on the appellant vide purchase order, dated 20-12-1961. The supply was to be made on different places and stations at different times.
The supply was made in toto accordingly between the period from 1-1-1962 to 22-5-1962.
According to the purchase order the supply was to be made according to the sample already given to the respondent and the Boards were to be of seasoned Shisham wood. Apart from that the goods were to be inspected by Messrs Associated Consulting Engineers and every consignment was to be accompanied by a certificate of the said firm that the goods were according to the contractual specifications. In addition to the said inspection a guarantee certificate was also to be furnished. The said supply in different consignments was made accordingly and each consignment, as such, was accompanied with the Inspection Certificate and the Guarantee Certificate. Some time later, the respondent found that the goods supplied were defective and they got the same examined through Jawad Haider, Assistant Director, WAPDA. In his inspection and inquiry the appellant was also associated. Thereafter, WAPDA got another inspection and inquiry conducted through Abdul Rehman, Deputy Chief Engineer, WAPDA (P.W.11) and he made a report that most of the wooden meter boards were not of seasoned Shisham wood and, therefore, had deteriorated by fungus and white aunts etc. Therefore, the respondent issued a notice on 4-4-1963 to the appellant saying that a sum of Rs.2,27,077.50 was claimable from the appellant on account of total rejection of the given number of Boards and Rs.10,896.90 on account of repairable Boards for which 10% deduction was being made. He added that if the refund was not made and arrangement was not agreed to the Boards will be returned to the appellants at their costs. The appellant repelled the said allegations through their counter-notice, dated 5-7-1963. It may be added here that total price of the Boards was Rs.3,66,200 without any objection or reservation except for a sum of Rs.22,200 whole of the amount was paid to the appellant prior to the dispute relating to the acceptance and rejection of the goods arose. The appellant did not agree to the refund of the amount demanded by the respondent. Therefore, they filed a suit for recovery of Rs.3,36,045.50. The suit was contested and the following issues were framed by the learned trial Court:-
(1) Whether the suit has been instituted in proper name, if not with what effect? O.P.P.
(2) Whether the defendant No. 4 is a partner of Messrs Mahmood Industries? O.P.P.
(3) Whether the defendant agreed to supply the meter boards in question according to sample and description? O.P.P. (onus objected).
(4) Whether the meter boards, supplied by the defendants were not in accordance with the sample and descriptions agreed upon and can the plaintiff raise the objection after the acceptance of the goods by its agent, Messrs Associated Consulting Engineers? O.P.P.
(5) Is the plaintiff entitled to the refund of Rs.3,36,045.50 from the defendants? O.P.P.
(6) Is the plaintiff entitled to any interest on the amount to be decreed in its favour? If so at what rate and for what period? 0 .P .P .
(7) Relief.
2. The learned Civil Judge, 1st Class, Lahore decided that the repsondent had used Boards of the value of Rs.93,104 and deducting this sum decreed the suit for a sum of Rs.2,42,941.50 vide judgment, dated 3-5-1976. The appellant has filed this first appeal against the said judgment and decree.
3. We have perused the record and have heard the arguments. The learned counsel for the appellant has confined his argument only to issue No. 4 relating to the supply of alleged defective Meter Boards and the effect of the acceptance of the same by the respondent. The Wooden Boards were to be supplied according to the samples deposited with the respondent. There is no dispute that the said samples were taken only in respect of the shape and size etc. Of the Boards and there is no dispute that all the Boards were according to the samples in shape and size. Apart from the condition relating to the supply of the Boards according to the samples there was a condition that the Boards will be of seasoned Shisham wood. There is also no dispute that inspection of the Boards was to be made by Messrs Associated Consulting Engineers and it is agreed that they duly inspected all the Boards and that each consignment was accompanied with a certificate of inspection made by them. They found all the Boards according to the samples and according to the description i.e.. Of seasoned Shisham wood. As pointed out above the whole price except Rs.22,200 was also paid by the respondent to the appellant. It is also accepted that the Boards in large quantity were actually utilized by WAPDA before any re inspection either through Jawad Haider or through Abdul Rehman was made. The supply of the goods was completed by 22 5-1962.
Re-inspection through Jawad Haider was made about 6 months after the supply was completed.
No evidence in regard to the inspection of Jawad Haider has been produced by the respondent/plaintiff. Neither he was produced in evidence nor his report was placed on record. His inspection has come to notice only from para. 6 of appellant's letter, dated 5-10-1962 (Exh. D.W.1).
The inspection by Abdul Rehman (P.W.11) was got made by WAPA afterwards. He inspected the Meter Boards on different dates from 6-11-1962, as stated by him as P.W.
11. As such his inspection commenced 6 months after the supply was completed and it continued for over a month. The legal question is whether the respondent could make these inspections after the lapse of so long a time and after having accepted the goods and after having appropriated/used a large quantity of the same and of course after the inspection made by Associated Consulting Engineers. Again another question is, whether after the inspection by Jawad Haider, their own officer, the appellant could get another inspection made by Abdul Rehman and that too secretly at the back of the appellant. Even if it is taken that the goods were supplied by the appellant on approval etc. They could under section 24 of the Sales of Goods Act, 1930 (III of 1930) reject the same within a reasonable time. Under section 63 ibid the question as to what is reasonable time is a question of fact. The inspection by Jawad Haider has not been brought on record by the respondent through any evidence and the respondent, in fact has not relied on the inspection of Jawad Haider. Their appointment of Abdul Rehman to re-inspect the goods means that they themselves did not accept the report, whatever it was, of Jawad Haider. Therefore, the relevant inspection is the inspection by Abdul Rehman. He made the inspection from 6-11-1962 to 9-12-1962. Commissioner of an inspection after the lapse of 6 months is not an inspection within reasonable time. The partial rejection of goods was conveyed to the appellant through notice, dated 4-4-1962 Exh. D.W.1. The appellant was not associated in the inspection allegedly made by Abdul. Rehman. Therefore, the said partial rejection was made after more than a year from the commencement of the supply and after about 11 months from the completion of the supply. The goods were not stored properly and were made to not here and there. Taking these facts into considerations it can never be said that the inspection and specifically the rejection were made within a reasonable time as understood in section 24 read with section 63 ibid. Therefore, the respondent accepted all the goods without any objection and without any rejection and they had no right to reject the same after the lapse of so a long time.
5. It may be pointed out that under sections 15 and 17 of the Sales of Goods Act when the goods are supplied by description or sample or by both the buyer has a right to examine the goods within a reasonable time and he has to convey the rejection within a reasonable time. The buyer in this case had, been afforded the opportunity of examination by Messrs Associated Consulting Engineers and they did inspect the goods and found them to be according the sample and description. In any case if the buyer had some inherent right of re-inspection he could make the same within a reasonable time and not after a so long time and not after making the payment and after utilization of a large quantity of the goods supplied by the appellant.
5. Even if it is taken that the buyer had a right of inspection after an inspection had been made by their agent it is to be considered as to whether such an inspection could be made at the back of the seller or he had to be associated with the same. As is clear from para. 6 of appellant's letter, dated 5-10-1962 (Exh.D.W.1/1) in the inspection made by Jawad Haider the appellant was duly associated. Therefore. The inspection made by him could be taken to be correct because that was a joint inspection. However, the respondent has not banked upon his inspection. So far as the disputed inspection by Abdul Rehman (P.W.11) is concerned it is conceded that it was done secretly without associating the appellant. Therefore, the appellant was condemned unheard and the goods were rejected and found to be defective without associating and hearing him. There is no dispute that legally nobody can be condemned unheard. This was not a first inspection, in fact it was a third inspection. WAPDA had not relied upon the inspection of their agent and had not accepted the report of Jawad Haider whom they had appointed for re-inspection. For the third inspection it was incumbent upon them to associate the appellant with the said inspection. As they were not so associated they are right in saying that may be the goods supplied by another contractor or some other goods were inspected by Abdul Rehman. It cannot be taken that the said Abdul Rehman inspected the goods in dispute as the same were never even returned to the appellant and they were not even asked to take away the same. Therefore, the report of Abdul Rehman cannot be taken into consideration at all, first because the respondent due to the inspection by their own agent and then by their own officer, Jawad Haider, as also on account of payment without prejudice and utilization of a large quantity of the goods supplied by the appellant and secondly because the law did not give any right to to respondent to unilaterlly reject the goods after the lapse of about one year.
5-A. Although Jawad Haider had not been produced in evidence and although his report has not been brought on record by the respondent yet the appellants in their letter, dated 5-10-1962 Exh.
D.W.1 themselves conceded that an inspection was made by Jawad Haider and they were associated with the same. They have also stated that he rejected 32 Boards at one place and 80 Boards at another place and found defective 116 Boards at one place and 1100 Boards at another place. As such he rejected 112 Boards and found defective 1216 boards, which could of course be repaired or used without repair. The appellant had not disputed the said inspection or the result of the said inspection. This inspection related to 10,000 boards although the total was 22,800 boards.
The price of the said rejected boards comes to Rs.1,792. The respondent himself had claimed reduction in respect of the defective Boards at 10% and on that formula the reduction for 1216 boards comes to Rs.1,945.6. Therefore, in respect of 10,000 boards the appellant was liable to make good the loss amounting to Rs.3,737.60. Even if the same rate and formula is applied for the remaining 12,800 boards the total loss to the WAPDA recoverable from the appellant will come to Rs.8,521.728. A sum of Rs.22,200 is yet recoverable by the appellant from the respondent in respect of the disputed goods. However, they have made no counter-claim for recovery of the same. In any case the said amount of Rs.8,521.728 will have to be adjusted towards the said dues of the appellant. This would leave nothing recoverable by the respondent from the appellant. The findings of the learned trial Court on issues Nos. 4 and 5 are, therefore, reversed and it is held that the respondent is not entitled to recover anything from the appellant in respect of the supply of the boards in question.
6. It may be mentioned that even if the inspection of Abdul Rehman were to be accepted the amount allowable to the respondent could at the most be:-
(a) claimed by WAPDA in notice, dated 4-4-1963 for:
(i) Rejected boards; 2,27,077.50
(ii) defective boards. 10,896.90 Total: 2,37,974.40
(b) Less:
(i) for used boards (as by trial Court) for payment yet due to the appellant. 93,104.00 22,200.00 Total: 1,15,304 Balance: 1,22,670.40 7 As a result the appeal is accepted. The judgment and decree, dated 3-5-1976 are set aside. The suit of the respondent is dismissed. However, as there was some defective supply by the appellant, thief parties will bear their own cost throughout.