JUDGMENT

SARKARIA, J.:—This is a defendant s appeal directed against a judgment and decree of the Mysore High Court.

2. On September 16, 1949, the plaintiff, K. H. Rao, entered into an agreement (Ex. D-2) with the defendant (Union of India) through its Military Head Quarter, Madras Area, contracting to supply onions for the period. October 1, 1949 to March 31, 1950, at the supply depots of the defendants in Bangalore, Cochin, Coimbatore and Wellington, at the rates mentioned in the Schedule to the agreement. The supply was to be made in such quantities as may be required from time to time by the defendant, not exceeding lbs. 45,000 a month for the Bangalore, Depot lbs. 3,000 for the Coimbatore Depot, lbs. 5,000 for the Wellington Depot and lbs. 5,000 for the Cochin Depot. Under the agreement, there was a security deposit of Rs.4,300 made by the defendant. This deposit was liable to forfeiture only in the event of any breach or non-performance of the contract by the plaintiff. Clause (7) of the agreement provided that if there was failure on the part of the plaintiff to perform the contract, the defendant was at liberty to make purchases of the onions elsewhere at the risk of the plaintiff. Clause (8) empowered "the Officer sanctioning the contract" to rescind the contract by written notice to the plaintiff in the six contingencies referred to in that clause, one of which was that such rescission could be made by that officer if the plaintiff declined, neglected or delayed, in complying with any demand or requisition or if he in any other manner failed to perform or observe the conditions of the contract.

3. We are concerned here with the supplies to Bangalore Depot. The plaintiff supplied the onions, as undertaken by him, to that Depot for October and for the first seven days of November, 1949. From and on November 17, 1949, the plaintiff completely stopped the supply of onions notwithstanding the demands issued by the defendant from time to time for the same. After some correspondence, the plaintiff was informed by a letter (Ex. P-7) that from the 29th December, 1949, the contract stood rescinded. This communication of rescission (Ex. D-40) was signed by one J. H. Wadia, then a Lt. Colonel, CRIASC.

4. The plaintiff made unsuccessful demand for the payment of the amounts admittedly due to him for the onions he had supplied and also for the return of the security deposit which he had made under the contract in question and also similar sums, due to him under earlier contract with the defendant.

5. On March 5, 1953, the defendant informed the plaintiff s bankers that a sum of Rs.18,228/14/5 was debited against the plaintiff towards damages payable by him for the breach of the contract.

6. Thereafter, on April 4, 1953, the plaintiff filed a suit for the recovery of Rs.45,359 consisting of these items:

Rs. As. P.

(a) Amount claimed as due under the earlier contracts ... 9,453-4-0

(b) Amount claimed towards the value of the goods supplied under the suit contract ... 10,928-5-0

(c) Security deposit under the suit contract ... 4,300-0-0

(d) Security deposit under the earlier contracts ... 3,045-0-0

(e) Claims towards reimbursements of the value of onions supplied to defendant otherwise than under the contract ... 4,950-0-0

(f) Profits which plaintiff had been prevented from making under the suit contract ... 3,000-0-0

(g) Interest on these sums ... ... 9,632-7-0

(h) Notice charges ... ... 50-0-0

Rs. 45,359-0-0

628

7. The plaintiff pleaded that more than Rs.75,000 was due to him from the defendant on December 15, 1949 under the earlier contract and that there was abnormal delay on the part of the defendant in the payment of the bills, which paralysed the financial resources of the plaintiff; that his supplies to the Bangalore depot were made in compliance with excessive demands and some of them were illegally diverted by the defendant to the Jalahalli Depot, though the supply to that depot was the obligation of another contractor; that the