Satyabrata Ghose v Mugneeram Bangur & Co. (1954)

Contract I · Frustration & Breach

Facts.

Land was agreed to be sold and developed; before completion, part of the land was requisitioned by the government for war purposes. The purchaser argued the contract was frustrated.

Issue.

What is the test for frustration in India, and does temporary difficulty frustrate a contract?

Held.

The Supreme Court held that s.56 is the governing law in India (not the English “implied term” theory). Frustration applies only where a supervening event strikes at the root of the contract and defeats its very purpose — a temporary requisition that did not do so was not frustration.

Why it matters.

It is the leading Indian authority on s.56, drawing the line between true frustration and mere hardship/delay — essential for any impossibility answer.

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