Judgment

R.C. Lahoti, J.-The appellant, the Atlas Export Industries, Junagadh (herein­after ‘Atlas’, for short) entered into a contract dated 3rd June, 1980 with M/s. Oceandale Company Limited, Hongkong (hereinafter ‘Oceandale’, for short). The agreement was for the supply of 200 MT of Indian groundnut extractions of the specifications as to quantity, quality and packages detailed in the contract and to be shipped on or before 30th June, 1980. The price was agreed at US $200 per M.T. The goods were to be supplied through M/s. Kotak and Company, Bombay (hereinafter ‘Kotak’, for short). M/s. Prashant Agencies, Bombay were the brokers. The existence of the contract, to which Atlas, Oceandale and Kotak were the parties, is not in dispute. Kotak were at all times responsible for the performance on behalf of the final buyers Ocean­dale. The letter of credit was opened by Oceandale in favour of Kotak who then transferred it in favour of Atlas. The letter of credit was opened at US $203 whereas Kotak’s purchase from Atlas was at US $200. It was agreed upon between Atlas and Kotak that the difference would be paid locally by Atlas to Kotak in Indian rupees. The time for shipment was extended