A.D.Koshal, J. - (1.) This appeal by certificate granted under Article 133 (1) (a) of the Constitution of India by the Allahabad High Court is directed against its judgment dated the 28th of January, 1966, confirming on appeal a decree passed by the Civil Judge, Kanpur, for the recovery of Rs. 46,652-14-6 with interest at the rate of 3 per cent annum from the date of the institution of the suit till payment in favour of M/s. J. K. Gas Plant Manufacturing Company Limited against the sole defendant, namely, the Union of India.
(2.) The case of the plaintiff company may be briefly stated thus. The Government of India had supplied some steel to the plaintiff company for manufacturing gas plants at Rampur. Only a part of the steel so supplied was utilized for the intended purpose and with regard to the rest the Regional Deputy Iron and Steel Controller, U. P. Circle, Kanpur (hereinafter referred to as the Kanpur Controller) directed the plaintiff company through a letter dated the 8th/10th of November, 1944 (exhibit 16) to deliver the same to the U. P. Registered Stock Holders Association, Kanpur (for short the Association). In relation to the recovery of price of the material the letter stated: "Your bill for cost of the material supported by original receipts from suppliers should be made out in the name of Iron and Steel Controller, Calcutta, and submitted to this office. Please make out a separate bill for handling, storage expenses, etc., and send to this office supported with original freight and payee's receipt." The order contained in letter exhibit 16 could not be implemented on account of lack of transport facilities. The Kanpur Controller therefore directed the plaintiff company to deliver the surplus steel to M/s. Govan Brothers Ltd., Rampur (hereinafter referred to as G. Brothers) and to this extent the order contained in letter exhibit 16 stood modified. The plaintiff company delivered to G. Brothers the surplus material lying with it between the 11th April, 1945 and 30th of April, 1945. The deliveries totalled 135 tons, 6 cwts., 1 quarter and 1 pound, the price whereof amounted to Rupees 43,728-6-6 which remained unpaid in spite of repeated demands made by the plaintiff company through letters addressed to the Kanpur Controller to whom the bills had been forwarded as desired. Ultimately the plaintiff company was informed by the Accounts Officer attached to the Iron and Steel Controller, Calcutta, that it should take up the matter with G. Brothers. As the price of the steel remained unpaid by the Union of India as well as G. Brothers the plaintiff company filed its suit for Rs.46,652-14-6 which was inclusive of interest on the principal price calculated at the rate of 6 per cent per annum from April, 1945, up to the date of the instruction of the suit, after serving the defendant with the requisite notice under Section 80 of the Code of Civil Procedure.
(3.) In its written statement the Union of India admitted the correctness of the order contained in letter exhibit 16. It pleaded however that, that order was cancelled in toto and not merely in regard to the party to whom the plaintiff company had to make over the surplus steel. It was specifically denied that the disputed goods had been delivered to G. Brothers at the risk and responsibility of the defendant and that the defendant was liable to pay the price thereof. It was asserted that the defendant was merely controlling the supply and distribution of iron and steel and that the liability to pay the price of any goods dealt with by it in the exercise of its powers of control rested upon the party receiving the goods. Another plea taken was that the suit was not maintainable in view of the provisions of Sec. 175 (3) of the Government of India Act, 1935, which enjoins that a contract between the Government of India and a third party has to be in writing and in a particular form. It was emphasized that G. Brothers alone were liable for the payment demanded by the plaintiff company.;