SANJAY KISHAN KAUL, J.

( 1 ) THE plaintiff is a limited company engaged in the business of manufacture of various varieties of paper which are sold through wholesalers. The arrangement of such sale is stated to be through direct payment or payment against hundies payable on due date with the bank by the such wholesalers.

( 2 ) DEFENDANT no. 1 was working as a wholesale dealer of the plaintiff-company in purchasing material. Defendant no. 2 is stated to be the Managing Director of defendant no. 1 and defendant no. 1 is stated to be controlled by both defendants no. 2 and 3.

( 3 ) THE terms of the sale of the paper to defendant no. 1 was stated to be through limited credit of 45 to 60 days. Fifteen days interest free credit facility from the date of delivery was available and thereafter interest was charged. Any default of payment carried interest of 21 per cent per annum from date of delivery till date of payment and further penal interest at 3 per cent. The arrangement between the plaintiff and defendant no. 1 worked satisfactorily up to september, 1985.

( 4 ) IN October, 1985, defendant no. 2 is stated to have approached the plaintiff personally at the Saharanpur Mills for wha