Judgment

SHAH, J.: Pilloo Dhunjishaw Sidhwa-hereinafter called the plaintiff - Carries on business in the name and style of Hind Motor Corporation at Bombay. By a letter dated February 1, 1952 the Transport Manager of the Municipal Corporation of Poona called upon the plaintiff to supply "motor spare parts" described therein of the total value of Rs. 2,71,808-12-3. The plaintiff by letter dated February 22, 1952 agreed to supply the goods. The plaintiff supplied the goods from time to time and the Corporation made payments according to the invoices. On July 3, 1953 the plaintiff delivered certain goods required by the Corporation and submitted an invoice for Rs. 49,743-6-2. The Municipal Corporation failed to pay the amount of the invoice and terminated the contract.

2. The plaintiff then instituted an action in the Court of the Civil Judge, Senior Division, Poona for a decree for Rs. 49,743-6-2 being the value of "motor spare parts" supplied, and for Rs. 39,755-2-4 being damages for breach of contract. The suit was resisted by the Corporation principally on the ground that the contract on which the plaintiff relied was not executed in the manner prescribed by the Bombay Provincial Municipal Corporations Act 59 of 1949 and on that ground the contract was not enforceable. The Trial Court decreed the plaintiff s suit for Rs. 49,743-6-2 being the invoice value of the goods supplied with interest at 4% from the date of the suit and dismissed the claim for damages.

3. The Municipal Corporation appealed to the High Court of Bombay against the decree of the Civil Judge, Senior Division. The plaintiff filed cross objections to the decree appealed from. The High Court rejected the plaintiff s claim for damages for breach of contract and held that the plaintiff was entitled only to the "fair price" of the foods supplied to the Corporation. In the view of the High Court the fair price of the goods was the "landed cost and 40% thereon" beside freight, insurance, packing and forwarding charges from Bombay to Poona. To determine the amount due to the plaintiff the Court appointed a Commissioner. The Commissioner reported that an amount of Rs. 38,010-59 was due to the plaintiff. The High Court disallowed Rs. 2,407-83 and Rs. 6,058 being items respectively of commission paid to the financier of the plaintiff and the customs duty for determining the landed cost. The High Court accordingly decreed in favour of the plaintiff Rs. 32,121-11 nP. with interest, at the rate of 6% from one month after the furnishing of the bill by the plaintiff to the corporation after the date of the notice", at the rate of 9% from the date of the notice upto the date of the suit, and at the rate of 71/2% from the date of the suit till the date of realization. The plaintiff has appealed to this Court with certificate granted by the High Court.

4. The Municipal Corporation of Poona was constituted on February 15, 1950 under the Bombay Provincial Municipal Corporations Act 59 of 1949. The provisions of the Act relating to the making of contracts are contained in Ss. 73, 74 and 75 in Ch. VII of the Act: insofar as they are relevant they provide:

S. 73 - "With respect to the making of contracts under or for any purpose of this Act, including contracts relating to the acquisition and disposal of immovable property or any interest therein, the following provisions shall have effect namely:-

(a) every such contract shall be made on behalf of the corporation by the Commissioner;

(b) no such contract for any purpose which, in accordance with any provision of this Act, the Commissioner may not carry out without the approval or sanction of some other municipal authority, shall be made by him until or unless such approval or sanction has first been duly given;

(c) no contract which will involve an expenditure exceeding five thousand rupees or such higher amount as the Corporation may, with the approval of the Provincial Government, from time to time prescribe, shall be made by the Comm