JUDGMENT :

G. Jayachandran, J.

1. The appellant before this Court is a public limited company engaged in the business of manufacture and sale of plant and machineries for manufacturing Oxygen and other industrial gases.

2. The respondent herein an intending purchaser of oxygen manufacturing plant, after negotiation with the appellant agreed to pay (a) Rs. 28,25,000/- for the plant and machinery; (b) Rs. 1,75,000/- for erection and commission and (c) Rs. 25,000/- for the Package and Forwarding. Totally, Rs. 30,25,000/- Through this letter of intent dated 02/08/1984, the respondent also agreed to pay 10% of the value of the plant and machinery at the time of placement of firm order and paid Rs. 1,00,000/- towards part advance along with its letter of intent.

3. The respondent was not able to mobilize the required money within the time expected. Hence, requested the appellant for extension of time. The appellant acceded to the request on condition that the balance amount of advance has to reach them by 31/01/1985 otherwise, they will not be able to retain the Japanese compressor for them. In alternate, they will supply the plant with Khosla compressor for the price prevailing at the time