Court caseAIR 1962 SC 779

At the request of an officer of the State, the respondent firm constructed a kutcha road, guard room, office, kitchen and storage sheds for the use of the Civil Supplies Department. The State took possession of the buildings and used them, but refused to pay, contending that there was no valid contract because the agreement was not executed in the form required by s. 175(3) of the Government of India Act 1935.

The Supreme Court held the State liable under s. 70. Three conditions must be satisfied: the person must lawfully do something for another or deliver something to him; he must not intend to act gratuitously; and the other person must enjoy the benefit. The section does not rest on any contract; it imposes an obligation to compensate because a benefit has been voluntarily accepted. The person for whom the act is done must have had the option to reject it; where he accepts and uses it, he must pay. The State, having used the buildings, was bound to compensate the contractor.