JUDGMENT :

P.Sree Sudha, J.

1. Learned VII Additional Chief Judge, City Civil Court, Hyderabad, passed common judgment dated 12.04.2002 in O.S.No.294 of 2000 and O.S.No.140 of 1998. Aggrieved by the said common judgment these appeals are preferred. CCCA No.147 of 2002 is preferred by M/s.Dokwal Refinery and CCCA No.200 of 2002 is preferred by MARKFED. Parties are referred to as arrayed in O.S.No.294 of 2000.

2. Heard learned Advocate General for ‘MARKFED’, learned Assistant Solicitor General for Central Government and learned counsel Sri S. Balchand for plaintiff.

3. M/s.Dokwal Refinery filed O.S.No.294 of 2000 for recovery of sum of Rs.24.24,395/- with interest at the rate of 24% per annum against A.P. State Cooperative Marketing Federation Limited (Defendant No.1) (for brevity, ‘MARKFED’), Union of India (Defendant No.2) and the Chief Director of Purchase, Army Purchase Organisation, New Delhi (Defendant No.3). Though the plaintiff filed the suit against all the defendants, it claimed the amount against the first defendant only and the second and third defendants were set ex parte.

4. The averments in the plaint in O.S.No.294 of 2000 disclose the facts, to the extent relevant, as under:

The plaintiff is a partnership firm registered under the Partnership Act with the Registrar of Firms with Registration No.01284 of 1990. The first defendant entered into an agreement with the plaintiff on 07.10.1994 for purchase of 500 metric tonnes of cotton seed refined oil to be supplied to the third defendant from November, 1994 to January, 1995 at the rate of Rs.36,430/- per metric tonne. The plaintiff complied the terms of contract. The total value of 500 metric tonnes of cotton seed refined oil was Rs.1,82,18,351.56 Ps. Out of this, the first defendant paid an amount of Rs.1,65,94,009.85 Ps. After excluding Rs. 54,419/- towards short supply, the balance amount of Rs.16,76,082.83 Ps., is due from the first defendant. Though repeatedly demand was made to clear the dues, dues were not paid. The first defendant took shelter under Clause 7 of the agreement, which, in effect requires first defendant to pay the amounts to plaintiff only when it receives the amount from the defence authorities and that the army authorities have not released the balance payment to the first defendant.

5. There was yet another contract between the first defendant and the army authorities with regard to supply of channa daal. The plaintiff is not aware of such transaction between them. There is no dispute regarding supply of cotton seed refined oil as per the contract. As such, the first defendant is not entitled to withhold the amount payable by it. All the previous payments were released by army authorities in favour of the first defendant and the first defendant in turn, after deducting one percent commission, paid the amounts to the plaintiff and withholding amount of Rs.16,76,082.83 Ps. by the first defendant is unreasonable and unjust.

6. Earlier, the plaintiff filed W.P.No.2144 of 1996 against the first defendant, which was allowed on 26.03.1996 directing the Government of India to release the payment in favour of the first defendant and the first defendant in turn directed to pay the same to the plaintiff. Aggrieved by the said direction, the Government of India, Ministry of Defence, carried the matter W.A.No.624 of 1996 before the Division Bench. The Division Bench allowed the appeal and dismissed the writ petition by decision dated 19.06.1996 on the ground that it is a civil dispute and there is no performance of public duty. Dissatisfied with the said observation of the Division Bench, the plaintiff preferred SLP No.16564 of 1996, but it was dismissed on 02.09.1996.

7. The plaintiff contended that its rights cannot be effected because of the breach of terms and conditions committed by the first defendant in another contract with army authorities. There is no dispute regarding the supply of cotton seed refined oil by the plaintiff to the first defendant and in t