Damages for loss of expected profits can be claimed in breach of contract cases, provided the breach is established and the loss is evidenced.

JUDGMENT :

Biren Vaishnav, J.

1. First Appeal No. 2531 of 2003 has been filed by the appellant, Food Corporation of India, who was the original defendant in Special Civil Suit No. 162 of 1990. The respondent – plaintiff had filed a suit inter alia stating that it was a partnership firm carrying on the business of clearing and handling cargo. The Food Corporation of India had issued an advertisement on 19.01.1987 offering coastal movement of food grains from Rozi-port i.e. Port of Bedi, also known as Port of Okha and also for the services which included transportation of grains from godowns to loading ports etc.

1.1 On the respondent – plaintiff being the lowest tenderer, the tender was accepted and a Work Order was issued on 02.03.1987. A Contract was awarded to transfer approximately 49,200 mts of food grains from Rozi-port to Calcutta and 39,200 mts from Rozi-port to Madras, in all total 88,400 mts.

1.2 The case of the plaintiff was that the rates for transportation from Rozi-port to Madras was fixed at Rs.367/- per ton. On payment of earnest money, the Food Corporation Of India, only provided 15,615 mts for transportation from Rozi to Madras against the work order of 39,200 mts. While not a single grain of 49,200 mts from Rozi-port to Calcutta. According to the Plaintiff, it therefore, suffered a loss at 10% being an amount of Rs.31,73,600/- for which a suit for recovery was filed.

1.3 The Trial Court, by the judgement and order dated 09.05.2003, decreed the suit in favour of the plaintiff. Hence, the first appeal by the appellant – Food Corporation of India.

2. Mr.Shakeel Qureshi, learned counsel appearing for the appellant – Food Corporation of India, made the following submissions:

2.1 He would submit that there was no loss and damages given in the plaint and the Trial Court, therefore, failed to consider that without any basis for claiming damages at the rate of Rs.31,73,600/- the decree was passed against the appellant.

2.2 He would submit that the Trial Court failed to consider the fact that as per the tender contract, rate was fixed per ton. Relying on the admission by the respondent No.1, Mr.Qureshi, learned counsel, would submit that the quantum of damages was not proved. In fact, from the evidence of the plaintiff, PW-1, it was clearly established that the shipping company M/s. Atlas did not remain idle.

2.3 Mr.Qureshi, learned counsel, would submit that there was no stipulation in the work order and Clause 15 which defined the volume of work was wrongly interpreted by the Trial Court to award damages when there was no proof of the loss of profit.

2.4 Mr.Qureshi, learned counsel, would further submit that the Trial Court failed to consider the relevant clauses, namely, Clauses (c), (d), (e), (f) & (g) of the Tender Agreement. Mr.Qureshi, would submit that the work order at Exh.41 and the Contract at Exh. 59 only mentioned approximate quantity which by no stretch of imagination can be termed as actual quantity. He, further submitted that the Trial Court committed an error of awarding 12% interest. He would rely on the following decisions :

(1) In the case of Fatehchand Vs. Balkishan Dass, reported in AIR 1963 SC 1405.

(2) In the case of Mohd. Dalilkhan Vs. State of Andhra Pradesh, reported in AIR 1963 A.P. 216.

(3) In the case of Karshandas vs. Saran Engineering Company, reported in AIR 1965 SC 1981.

(4) In the case of Food Corporation of India Vs. Lakshmi Cattle Feed Industries, reported in 2006 (2) SCC 699.

(5) In the case of Kailashnath Associates Vs. Delhi Development Authority, reported in 2015 (4) SCC 136.

(6) In the case of Svati Lat Utpadak Auduyogic Sahkari Mandali Ltd Vs. Gujarat Housing Board, rendered by a Division Bench of this Hon’ble Court and reported in AIR 2014 Guj. 107.

(7) In the case of B.D. Sorathia Vs. State of Gujarat, reported in 2014 (2) GLH 254.

3. Mr. D. M. Thakkar, learned counsel appearing for the respondent – original plaintiff, would submit that reading the tender notice dated 19.01.1987 it is clear t