'A' sues 'B' for inducing 'C' to breach a contract of service made by him with 'A'. 'C', on leaving 'A's service says to 'A', 'I am leaving you because 'B' had made me a better offer.' Whether this statement of 'C' is relevant?

The Problem of the Statement: Its Prima Facie Inadmissibility

At first glance, C's statement — "I am leaving you because B has made me a better offer" — appears to be inadmissible on two distinct grounds. First, it is a statement made behind B's back, which is sought to be used as evidence against B in the suit. This attracts the rule of res inter alios acta — a transaction between two parties (A and C) ought not to operate to the disadvantage of a third (B). Second, the statement is a piece of hearsay — C spoke these words to A, and A or some other witness would be called to depose to what C said.

These are formidable objections, and in ordinary circumstances, either would be sufficient to exclude the evidence. The genius of Section 9 IEA / Section 7 BSA is that it admits such evidence not in spite of these objections, but by rising above them through a different and superior ground of relevancy.

The Governing Provision: Section 9 IEA / Section 7 BSA

Section 9 of the IEA (corresponding to Section 7 of the BSA) declares relevant all facts that are —

1. Necessary to explain or introduce a fact in issue or relevant fact;

2. That support or rebut an inference suggested by a fact in issue or relevant fact;

3. That establish the identity of any thing or person;

4. That fix the time or place at which any fact in issue or relevant fact happened; or

5. That show the relation of parties by whom any such fact was transacted —

in so far as they are necessary for that purpose.

The section occupies a unique and important space in the law of evidence. Sir James Stephen, who drafted the Indian Evidence Act, conceived of it as the provision that allows the court to see the full context of a disputed act — the background, the setting, the explanations — without which the fact in issue would appear naked and incomprehensible.

Illustration (d) Examined

Illustration (d) to Section 9 IEA / Illustration (d) to Section 7 BSA provides in exact terms:

"A sues B for inducing C to break a contract of service made by him with A. C, on leaving A's service, says to A — 'I am leaving you because B has made me a better offer.' This statement is a relevant fact as explanatory of C's conduct, which is relevant as a fact in issue."

This is the precise scenario in the question before us. The Act itself provides the answer — C's statement is relevant. But the real inquiry is: on what legal foundation does this relevancy rest?

The Anatomy of the Problem: Why the Statement Is Relevant

C's Conduct Is a Fact in Issue

The suit is by A against B for inducing C to break a contract of service. The tort of wrongful inducement — which corresponds to what is now governed by Section 53 of the Bharatiya Nyaya Sanhita, 2023 in criminal terms and by the common law tort of inducing breach of contract in civil terms — has as its central element the fact that C actually broke the contract and that B induced the breach. The fact that C left A's service is therefore a fact in issue. It is the physical, external act that is the subject of the entire litigation.

But an act without an explanation is often incomplete as evidence. C's departure from A's service is visible and provable as a physical fact. What is not visible — what the court cannot know from mere observation — is why C left. The reason for leaving, the cause of C's action, is the explanatory fact that gives the departure its legal character and significance. This is precisely what Section 9 IEA / Section 7 BSA was designed to admit.

The Statement as Explanatory of Conduct

The court, when it observes C's conduct of leaving A's service, is naturally drawn to ask: what explains this conduct? Was C simply dissatisfied? Did the contract expire naturally? Was C lured away by B? The statement C made to A — "I am leaving because B has made me a better offer" — is the direct, contemporaneous explanation of C's own conduct. It speaks from the moment of the act itself and attaches meaning to it.

The authority of the statement lies in its proximity to the act it explains. There is no gap in time between the conduct and the statement — the statement and the departure are practically one and the same event. This is what distinguishes an explanatory statement within the meaning of Section 9 IEA / Section 7 BSA from a casual narrative made long after the event. The former is woven into the fabric of the conduct; the latter is merely hearsay commentary on past events.

The Significance of the Res Inter Alios Acta Objection

The objection that the statement was made behind B's back and that B was not present when it was made is, in the ordinary scheme of evidence, a powerful bar to its admission. The doctrine of res inter alios acta holds that a person cannot be bound or prejudiced by the acts or statements of others, made in his absence and without his authority.

The provision, however, expressly addresses this. The notes to Section 9 IEA make clear that Illustrations (d) and (e) indicate that explanatory statements are admitted under this section irrespective of the fact whether the person against whom it is made was present when the statement was made. This is a deliberate and significant departure from the ordinary rule. The legislature, through the illustration, acknowledges that the requirement of explaining conduct — which is a fact in issue — is a sufficiently weighty justification to override the ordinary exclusion based on res inter alios acta. The statement is admitted not to prove that B in fact made a better offer, but to explain why C left — which is the fact that the court must understand and evaluate.

The True Legal Effect of the Statement

Here an important caveat must be carefully understood. Admitting C's statement that B made a better offer is not the same as treating the statement as proof that B actually made such an offer. The statement is admitted for a limited and specific purpose — to explain C's conduct of leaving A's service, which is the fact in issue. Whether B actually induced the breach, whether the offer B made was in fact the cause of C's breach, are still matters to be proved by independent evidence. C's statement is one element in that evidentiary picture, not a conclusive determination of B's liability.

This is a fundamental distinction that courts have emphasised. The learned author V.P. Sarathi explained this clearly in the context of Illustration (d) — the statement is relevant because it forms part of the transaction, and the transaction is the tort of inducing breach of contract. C's departure and the reason for it are inextricably linked and together constitute the transaction under inquiry. The statement cannot be seen in isolation from the act of leaving — they are together the single event that the court is asked to evaluate. To exclude the statement while admitting the physical fact of departure would be to give the court half the evidence and ask it to decide the whole case.

Sections 8 IEA / 6 BSA: An Additional Ground

It is worth noting that the relevancy of C's statement can also be examined, though more indirectly, through the lens of Section 8 IEA / Section 6 BSA read with its Explanation 2. That Explanation provides: "When the conduct of any person is relevant, any statement made to him or in his presence and hearing, which affects such conduct, is relevant."

C's conduct in leaving A's service is relevant to the facts in issue. The statement C made to A, while not technically made to C but by C, is a statement that accompanied and explained an act (the departure) and in that sense brings itself within the spirit of Explanation 1 to Section 8 IEA / Section 6 BSA, which makes statements relevant when they accompany and explain acts other than statements. The departure from service is the act; C's statement of the reason is the explanatory utterance accompanying that act. Together, they constitute the full event of C's leaving A's service.

Courts in India have consistently treated such explanatory statements as particularly weighty when they are made at the time of the act and before any dispute arose — precisely because there is no occasion or motive for the speaker to have fabricated an explanation. C's statement to A at the moment of departure is made at the most natural time, in the most natural manner, and without any forensic motive. This spontaneity and contemporaneity is what the law recognises and rewards with admission.

The Distinction Between Relevancy and Proof

There is one further clarification that a student of evidence must carry away from this illustration. The fact that C's statement is relevant under Section 9 IEA / Section 7 BSA does not mean that it proves B's liability. Relevancy is the threshold — it says this fact has sufficient logical connection to the controversy to be received by the court for consideration. What weight the court gives it, how it assesses its credibility, whether it corroborates or conflicts with other evidence, and what ultimate inference the court draws — these are all separate questions. A fact that is relevant may, at the end of the day, not be believed or may not carry enough weight to discharge the burden of proof.

In the context of this suit, A still bears the burden of establishing that B actually induced C to break the contract. C's statement is important evidence in that inquiry, but it is not the end of the matter. A may call C as a witness. C, if called, can give direct evidence of B's offer. The statement made at the time of departure would then serve the additional purpose of corroborating C's testimony under Section 157 IEA / Section 160 BSA, thereby reinforcing its evidential weight.

A Note on the BSA Counterpart

Section 7 of the Bharatiya Sakshya Adhiniyam, 2023 is in substance identical to Section 9 of the Indian Evidence Act, 1872 in this context. The only modification in Section 7 BSA is a minor drafting change in the title of the provision, which in the BSA inserts the phrase "fact in issue" alongside "relevant facts" to make the scope of the section more explicit. The illustrations, including Illustration (d), are reproduced verbatim. The principle, the legal framework, and the result are unchanged.

What this illustration ultimately demonstrates is a profound truth about the law of evidence: that facts cannot always be understood in isolation. An act without its explanatory context is often meaningless, and the law wisely provides a mechanism — through Section 9 IEA / Section 7 BSA — to bring in that context even when the orthodox rules of evidence might otherwise exclude it. C's statement, born at the moment of departure, is not mere hearsay — it is the voice of the act itself.