Judgement

WANCHOO, J. : This is an appeal by special leave against the judgment and decree of the Allahabad High Court. The appellant is a registered partnership carrying on business at Kanpur. It entered into an agreement in December 1948 with the Vijai Lakshmi Sugar Mills Limited, Doiwala, District Dehra Dun (hereinafter referred to as the Mills) and was appointed sole selling agent of the Mills. According to the terms of the agreement, the appellant deposited a sum of Rs. 50,000 as security for due performance of the contract, and this amount was to carry interest at the rate of Rs. 6 per cent per annum to be paid by the Mills. In November 1949 an order was passed winding-up the Mills and this happened before the period of agency came to an end. Consequent on the winding-up of the Mills, the appellant made an application in September 1950 by which it prayed for refund of security deposit along with interest. It was also prayed that the Mills held the deposit as trustee and in consequence the appellant was entitled to priority, with respect to the amount of Rs. 50,000. In addition there was a claim of Rs. 24,500 with respect to commission. That claim was given up and we are now no