KUJU COLLIERIES LTD. versus JHARKHAND MINES LTD. & ORS.

KUJU COLLIERIES LTD. versus JHARKHAND MINES LTD. & ORS.

Section 65 of the Contract Act does not apply where both parties were aware of the illegality of the contract at its inception; since the appellant, a mining business, made payment under a lease prohibited by statute and rules, cognizant of the legal requirements, no restitution is available.

Parties
Appellant: Kuju Collieries Ltd.; Respondent 1: Jharkhand Mines Ltd.; Respondent 3: Respondent 3; Respondent 4: Respondent 4; Respondent 5: Respondent 5; Intervener: Intervener
Jurisdiction
India
Judgment Date
12 August 1974
Procedural Posture
Civil Appeal / Judgment on Appeal by Special Leave
Outcome
Appeal dismissed.
Legal Topics
Restitution, Void Agreements, Mining Lease, Section 65 Contract Act
Contract Law Mining Law Restitution Void Agreements Mining Lease Section 65 Contract Act

Case Brief

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Parties

Kuju Collieries Ltd.

Appellant

Jharkhand Mines Ltd.

Respondent 1

Respondent 3

Respondent 3

Respondent 4

Respondent 4

Respondent 5

Respondent 5

Intervener

Intervener

Procedural Posture

Civil Appeal / Judgment on Appeal by Special Leave

Legal Issues

  1. 1 Whether payment made under an illegal mining lease is recoverable under Section 65 of the Indian Contract Act
  2. 2 Whether Sections 65, 70, or 72 of the Contract Act apply to the facts when both parties knew of the illegality at the time of agreement

Ratio Decidendi

Section 65 of the Contract Act does not apply where both parties were aware of the illegality of the contract at its inception; since the appellant, a mining business, made payment under a lease prohibited by statute and rules, cognizant of the legal requirements, no restitution is available.

Court Disposition

Appeal dismissed.

Orders

  • No relief to appellant for recovery of Rs. 80,000.
  • No costs awarded.