JUDGMENT

R.F. Nariman, J. - Leave granted.

2. Having heard learned counsel for the parties, it is important to first set out a few basic facts:

i) A notice inviting quotations was issued on 06.07.2015 by the Respondents herein for Clotrimazole Cream 1% 15 gm tube, the quantity being required for the first year and second year, being:

ii) To this N.I.Q., the Appellant submitted its quotation on 09.07.2015, in which it was specified that the shelf life of the said cream would be only 2 years.

iii) After rates were negotiated and re-negotiated, a supply order was issued on 04.11.2015 in which it was clearly stated :

"8. Not more than 1/6th of the shelf life should have expired when drug Pharmaceuticals are received in medical store PGI, Chandigarh."

iv) In accordance with the supply order, the first instalment of 1700 tubes of Clotrimazole Cream was supplied on 18.01.2016, there being no complaint whatsoever in respect of the said supply. However, when the second ins