Judgment

DWIVEDI, J. :- The factual framework of this appeal is set spatially in the undivided geography of India during the British period and temporarily during 1944 to June 1947. There are three appellants: (1) Messrs Hari Chand Madan Gopal and Co., (2) Hari Chand and (3) Sri Ram. The first appellant is a partnership firm, of which the other two appellants are partners. Some time in 1944 there was concluded an agreement between the first appellant and the Government of the Province of Punjab (hereinafter called the Undivided Punjab). By that agreement, the first appellant agreed to act as a clearing Agent (Foodgrains) for the sale and purchase of foodgrains on behalf of the Undivided Punjab on payment of a commission. The first appellant obtained stock of rice from the Rationing Controllers of the districts which were after the partition of India in August 1947 included in the State of East Punjab and are now included in the State of Punjab. According to the State of Punjab (the plaintiff-respondent) the price of the stock supplied by the Rationing Controllers was Rupees 12,15,178/4/11. The stock was supplied in May and June, 1947. The first appellant sold the said stock to perso