Judgment

VAIDIALINGAM, J.: This appeal, by the plaintiffs-appellants, on certificate granted by the Calcutta High Court, is directed against the judgment and decree of the Division Bench of that Court, dated January 29, 1964 in Appeal from Original Order No. 28 of 1960, affirming the judgment and decree, dated July 16, 1959 of the learned Single Judge in Suit No. 2745 of 1947. The circumstances leading up to the institution of the said suit may be stated.

2. The appellants, who were dealing also in the purchase of new and second hand machinery, on coming to know from an advertisement in a Daily that the defendant-respondent was offering, for sale area-scrap, addressed a letter, dated November 6, 1946 to the respondent intimating their desire to purchase the materials advertised for sale, and stating that one of their representatives would be contacting them shortly. Obviously the parties must have met and decided about the purchaser, as is seen from the letter, dated November 18, 1946 addressed by the General Manager of the respondent, to the appellants. That letter refers to a discussion that the parties had on that day and the respondents confirmed having sold to the appellants the entire lot of aero-scrap lying at Panagarh, on the terms and conditions mentioned in the letter. The material was stated to be in Dump No. 1 near the flight line at Panagarh and the approximate quantity was 4000 tons of aero-scrap, more or less. The letter refers to the appellants having agreed to pay Rs. 10 lakhs as price of the materials in the said Dump No. 1, against which the receipt, by cheque, of a sum of Rupees 2,50,000/- was acknowledged by the respondent. There is a further reference to the fact that the appellants had agreed to pay the balance of Rs. 7,50,000/- that day itself. The letter also refers to the fact that the price mentioned does not include sale-tax to be paid by the appellants and to certain other matters, which are not relevant for the purpose of the appeal. The letter further says : "The company s terms of business apply, to this contract and a copy of this is enclosed herewith". We shall refer to the relevant clauses in the company s terms of business, referred to in this letter, a little later. It is enough to note, at this stage that those terms of business have been made part of the terms and conditions governing the contract.

3. On the same day, the appellants sent a reply to the respondent, acknowledging the letter. The appellants said that they noted that the respondent wants to sell the aero-scrap as it is and that it wanted the appellants to pay the full value, viz., the balance of Rs. 7,50,000/- at once. The appellants confirmed the arrangement contained in the respondent s letter; but regarding payment, the appellants said that they agree to pay the balance amount in two installments, viz., Rs. 25,0,000/- or before November 22, 1946 and the balance of Rs. 5,00,000/- on or before December 14, 1946. They also further stated that they shall commence taking delivery after making full payment. The respondent by its letter dated November 20, 1946 acknowledged the receipt of the appellant s letter dated November 18, 1946 together with the modifications contained therein. But the respondent emphasised that the other terms and conditions will be as mentioned in its letter of November 18, 1946.

4. On November 22, 1946, the appellants sent a communication, purporting to be in continuation of their letter dated November 18, 1946. In this letter they state that the transaction has been closed without inspecting the materials, merely on the assurance of the respondent that the quantity of aero-scrap was about 4,100 tons. The appelants future state that they have since obtained information that the quantity stated to be available is not on the spot and therefore they cannot do the business. Under the circumstances, they request the respondent to treat their letter, dated November 18, 1946 as cancelled and to return the sum of Rs