Mrs. Sujata V. Manohar, J. - (1.) Leave granted.
(2.) The appellant, U. P. State Sugar Corporation entered into an agreement dated 2nd of August, 1989 with the respondent, M/s. Sumac International Pvt. Ltd. under which the respondent agreed to design, to prepare an engineering lay-out and to manufacture or procure and supply to the appellant the machinery and equipment for a complete sugar plant for extension and modernisation of the appellants existing sugar plant at Rohana Kalan, District Muzaffarnagar, U. P. The respondent was required to set up a new plant of 2500 TCD at a new site or an adjoining site close to the existing sugar plant of the appellant. The total contract price was fixed under Clause 2.1 of the contract at Rs. 1780 lacs.
(3.) Under the terms of the agreement the respondent was required to set up the plant and make it ready for commercial production by 30th November, 1990. The agreement stated that in this regard time was of the essence of the contract and if the respondent failed to do so the consequences were also spelt out in the contract. Under Clause 3 of the contract a month-wise progressive delivery report was to be submitted by the respondent and a PERT/CPM chart had to be submitted and adhered to. Clause 4 which dealt with delivery required the respondent to complete all supplies by 15th of November, 1990 so that the plant could be commissioned by 30-11-1990. Under Clause 11.1 the respondent-seller was entitled to a reasonable extension of time as decided by the purchaser if the purchase order was expressly suspended for no fault of the seller,;