Judgment

SHAH, J. : Bhikhraj Jaipuria-hereinafter called the appellants the sole proprietor of a grocery business conducted in the name and style of "Rajaram Vijai Kumar" in the town of Arrah in the State of Bihar. In the months of July and August, 1943, the Divisional Superintendent, East Indian Railway under three "purchase orders" agreed to buy and the appellant agreed to sell certain quantities of food grains for the employees of the East Indian Railway.

2. The following table sets out the purchase prices, the commodities the dates of purchase orders, the quantities and the rates and the method of supply.

Purchase Order No. Date of purchase orders. Kinds of commodity. Quantity of commodities. Rates.

69. 20-7-1943. Gram 1st quality 1000 maunds. @ Rs.15 Per md. (plus cost of new bags not exceeding Rs. 75 per 100 bags) F. O.R. any E. J. Rly. station in Bihar.

76 24-7-1943. Rice Dhenki Medium quality. 1000 mds. @ Rs. 22-8-0 (plus cost of bags not exceeding Rs. 75 per cent) per md. F. O. R. any station on the division.

ii. Wheat white as per sample. 5000 mds. @ Rs. 20-8-0 per md. with bags F. O. R. any station on E.I.R. on the Division.

106. 24-8-1943. Rice medium quality. 15000 mds. @ Rs. 24 per md. Without bags F. O. R. E. I. Rly. station in Bihar.

3. Purchase orders Nos. 69 and 76 were signed by S. C. Ribbins, Personal Assistant to the Divisional Superintendent and purchase order No. 106 was signed by the Divisional Superintendent. Under the purchase orders delivery of grains was to commence within seven days of acceptance and was to be completed within one month. The appellant delivered diverse quantities of food grains from time to time but was unable fully to perform the contracts within the period stipulated. Between July 20, 1943 and August 24, 1943, he supplied 3465 maunds of rice and between September 1, 1943 and September 19, 1943 he supplied 1152 maunds 35 seers of wheat. In exercise of the powers conferred by cl. (b) of sub-r. (2) of R. 81 of the Defence of India Rules, the Government of Bihar by notification No. 12691 - P.C. dated September 16, 1943, directed that commodities named in column I of the schedule shall not, from and including September 20, 1943, and until further notice, be sold at any primary source of supply or by the proprietor, manager or employee of any mill in the Province of Bihar at prices exceeding those specified in the second column of the schedule. The controlled rate of rice (medium) was Rs. 18 per standard maund, of wheat (red) Rs. 17, of wheat (white) Rs. 18 and of gram Rs. 12-8-0. The Sub-Divisional Magistrate, District Arrah issued on September 21,1943 a price-list of controlled articles fixing the same prices as were fixed for wheat, rice and gram by the notification issued by the Government of Bihar. By cl. (2) of the notification, a warning was issued that in the event of the dealers selling controlled articles at rates exceeding those fixed or with-holding stocks of such articles from sale, "they will be liable to prosecution under R. 81 (1) of the Defence of India Rules."

4. By a telegraphic communication dated September 28, 1943, the Divisional Superintendent informed the appellant that under the purchase orders, food grains tendered for delivery will not, unless despatched before October 1, 1943 be accepted, and barring a consignment of 637 maunds 20 seers accepted on October 7, 1943, the Railway Administration declined to accept delivery of food grains offered to be supplied by the appellant after October 1, 1943. The appellant served a notice upon the Divisional superintendent complaining of breach of contract and sold between February 18 and February 23, 1944 the balance of food grains under the purchase orders which were lying either at the various railway stations or in his own godowns. The appellant then called upon the Railway Administration to pay the difference between the price realised by sale and the contract price and failing to obtain satisfaction, commenced an action