JUDGMENT

Variava, J.-This Appeal is against a judgment of the Andhra Pradesh High Court dated 21st March, 1996.

2. Briefly stated the facts are as follows :

The Appellant had agreed to supply arhar dal to the Army Purchase Organisation, Reserve Grain Depot, Lucknow. They therefore invited tenders for milling arhar whole into dal. The Respondents submitted two tenders; one for conversion of 1,500 metric tonnes of arhar whole into dal and the second for converting 2,000 metric tones. These tenders were submitted on 10th May, 1977 and 1st August, 1977. Both these tenders were accepted by the Appellant and two Agreements were entered into between the parties.

3. The Respondents delivered 1607.495 tonnes of arhar dal, which was accepted by the Appellants. The Appellant then sent the same to the Army, but the Army rejected 786.505 tonnes of dal on the ground that the same did not conform to specifications. The Appellant asked the Respondents to take back the rejected dal and to upgrade it. A supplemental agreement was then entered into to upgrade and replace the rejected dal. The Respondents took back 208.245 tonnes of dal and replaced 23.945 tonnes. The Respondent thereafter delivered 47.38