The Scrap Control Order and the controlled price of scrap iron applied to sales of scrap iron for export as well as for domestic use, but a party who purchased scrap iron without informing the seller that it was for export was not entitled to damages based on the difference between the price paid by his vendee for export and the price he would have paid to the seller.

Judgement

RAGHUBAR DAYAL. J.: Karsandas H. Thacker, appellant, sued the respondent for the recovery of Rs. 20,700 for damages for breach of contract. He alleged that he entered into a contract with the respondent for the supply of 200 tons of scrap iron in July 1952 through correspondence, that the respondent did not deliver the scrap iron and expressed his inability to comply with the contract by its letter dated January 30, 1953. In the meantime, the appellant had entered into a contract with M/s. Export Corporation, Calcutta for supplying them 200 tons of scrap iron. On account of the breach of contract by the respondent, the appellant could not comply with his contract with M/s. Export Corporation which in its turn, purchased the necessary scrap iron from the open market and obtained from the appellant the difference in the amount they had to pay and what they would have paid to the appellant in pursuance of the contract.

2. The respondent contested the suit on grounds inter alia that there had been no completed contract between the parties and that the appellant suffered no damages. The controlled price of scrap iron on January 30, 1953, was the same as it was in July 1952 when the contract was made. It was further contended for the defendant that it was not liable to make good the damages the appellant had to pay to the Export Corporation as the appellant had entered into the contract on the basis of principal to principal and had not disclosed that he was purchasing scrap iron for the Export Corporation or for the purpose of export.

3. The trial Court accpeted the plaintiff s case that there was a completed contract between the parties, that the respondent broke the contract and that the appellant was entitled to the damages claimed. It accordingly decreed the suit. On appeal by the respondent, the High Court reversed the decree. It held that there had been a completed contract between the parties on October 25, 1952, but held that the respondent was not responsible for committing breach of contract as it could not perform the contract on account of the laches of the appellant and that the appellant suffered no damages in view of the controlled price for scrap iron being the same on Jaunary 30, 1953 as it was in July 1952. The result was that the appellant s suit was dismissed. The High Court granted the necessary certificate under Art. 133(1)(a) of the Constitution and that is how the appeal has been presented to this Court.

4. It has been urged for the appellant that the Iron and Steel (Scrap Control) Order, 1943, hereinafter called the Scrap Control Order, and consequently, the controlled price of scrap iron, applied to cases of sale of scrap iron for use within the country and did not apply, to sales of scrap iron for purposes of export. We do not find anything in the Defence of India Rules, 1939, under which the Scrap Control Order was issued in 1943, or in the Essential Supplies (Temporary Powers) Act, 1946, that the Control Ordes would not apply to sales of controlled articles for export. Rule 81 of the Defence of India Rules, 1939, authorised the Central Government, inter alia, to provide by order for maintaining supplies and services essential to the life of the community, for the controlling of the prices at which articles or things of any descrpition whatsoever may be sold and there is nothing to suggest that this control of prices was to apply only to sales of any articles within the country and not for purposes of export. Similarly, S. 3(1) of the Essential Supplies (Temporary Powers) Act, 1946, provided that the Central Government may, by notified order, provide for regulation or prohibition of production, supply and distribution of any essential commodity and for trade and commerce therein, in so far as it appears to be necessary and expedient for maintaining or increasing supplies of any essential commodity or securing its equitable distribution or availability at fair prices.

5. There is nothing in the terms