Mitter, J. - (1.) This is an appeal from an order of injunction, restraining the Appellant from proceeding with suit No. O.S. 191 of 1964 Kamala Sugar Mills Ltd. v/s. Starcosa G.M.B.H. and Co. and Ors. pending in the Court of the Subordinate Judge of Coimbatore until the final disposal of suit No. 855 of 1963 filed by Starcosa G.M.B.H. and Co. against Kamala Sugar Mills Limited.
(2.) The claim of the Plaintiff in the Calcutta suit (hereinafter referred to as Starcosa) against Kamala Sugar Mills Limited (hereinafter referred to as the Sugar Mills) is for the balance of wages and travelling and incidental expenses due in respect of the work done in the erection of a starch and glucose plant supplied by Starcosa to the Sugar Mills and for putting the same in operation during the year 1960. According to the plaint the work of erection was completed by one H. Kirchmann of Starcosa between June 30, 1959 and March 28, 1960. The charges for such work were paid upto February 28, 1960 and the Plaintiff's claim for the work done by Kirchmann from February 29 to March 28, 1960, amounted to Rs. 4,688.71. The Plaintiff also claims Rs. 46,883.67 in respect of the work done in the erection and operation of the plant by one H. Staacke between January 19, 1960 and November 22, 1960. The claim is limited to the period between February 29, 1960 and November 22, 1960. Besides the above Starcosa's claim also includes a sum of Rs. 561.15 for certain instruments and chemicals supplied to the Sugar Mills. The suit was filed on May 10, 1963, with leave under Clause 12 of the Letters Patent on the allegation that the agreement for erecting the starch and glucose plant supplied and for putting the same into operation under the supervision of an erector and an engineer of Starcosa was entered into by correspondence passing between the Plaintiff through its technical advisers and the Defendant dated May 11 and 20, 1959, the acceptance being received in Calcutta within the jurisdiction of this Court. After entering appearance in this suit the Defendant Sugar Mills took out a summons in August 1963 for the revocation of leave granted under Clause 12 of the Letters Patent. This application was however dismissed in February 1964 and no appeal was preferred therefrom. On March 10, 1964, Starcosa made an application by way of notice of motion for judgment on admission said to have been made in some of the letters written by the Sugar Mills to Starcosa. On March 25, 1964, the Sugar Mills filed their written statement in this suit. On May 27, 1964, Starcosa's application for judgment on admission was dismissed by this Court. An appeal preferred therefrom met the same fate later on. On June 5, 1964, the Sugar Mills instituted the suit against Starcosa and Wunderlich and Staacke in the Court of the Subordinate Judge of Coimbatore claiming Rs. 39,995.34. On being served with the summons in the said suit Starcosa applied for an injunction restraining the Sugar Mills from proceeding with that suit. The interim order of injunction granted on Starcosa's application was made absolute by a judgment in March 1965. Hence this appeal.
(3.) The claim in the Calcutta suit is quite a simple one. It is based on two letters and is for the recovery of wages of and travelling expenses incurred by two engineers and erectors. The written statement of the Sugar Mills is prolix and cumbersome. In order to thwart the claim of the Plaintiff the Defendant resorted to a long rigmarole pleading various representations on the part of the plain tiff from time to time which are all described as false or incorrect as a result whereof the Sugar Mills did not get the plants they thought they would get and have suffered extensive damage which is quantified at a figure approximating Rs. 17 lakhs. In brief the defence put up is as follows: (a) Early in the year 1955 two representatives of the Defendant went over to Germany and sought the advice of the Plaintiff regarding machinery and equipment suitable for the manufacture of starch, glucose and dextrose. The Plaintiff represented to the said two persons that solid glucose and dextrose were identical and offered to send to the Defendant quotations for the machinery and equipment for the conversion of 20 tons of roots to starch per day and a plant for the manufacture of solid glucose therefrom. (b) Actually two quotations were sent by the Plaintiff with letter dated January 31, 1955. As it was not clear from the quotations as to whether the plants mentioned could be used for the manufacture of dextrose the Plaintiff in response to enquiries by the Defendant, asserted in writing and assured the Defendant that it was possible to proceed very far with the plant offered to manufacture a produce whose dextrose content would be about 80% and that this would require very little additional machinery including wooden vats. (c) Relying upon the said advice the Defendant placed with the Plaintiff orders for the supply of a starch plant and a glucose plant. (d) The Plaintiff agreed to send an erector and an engineer for erection of the said plants so that the same could be set up as a plant fit for the making of dextrose as mentioned. The terms of payment to the Plaintiff for the aforesaid work were contained in several letters including the two mentioned in the plaint. (e) The Plaintiff sent out the erector Mr. Kirchmann and the engineer Mr. Staacke in July 1959 and January 1960 respectively. (f) When the plants were put in commission it was found that they were incapable of producing dextrose required by the Defendant. (g) Between August and December 1959, it was realised by the parties that there had been a serious mistake and that the representations made by the Plaintiff to the effect that a few wooden vats and other inexpensive machinery would be enough to convert the plant into one for making glucose into dextrose were false. (h) It was also realised that to convert the existing plants into one for making dextrose would entail huge expenditure in the shape of various expensive additional machinery and equipments. (i) The Plaintiff tentatively agreed to supply and/or arrange to supply additional machinery which would make the plant fit for the aforesaid purpose and to have the same manufactured and erected under the Plaintiff's engineer. (j) Ultimately in May 1960, it was agreed by and between the Plaintiff represented by N. Wunderlich and the Defendant that certain further necessary machinery and equipment would be purchased and/or fabricated in India under the supervision and direction of Mr. Staacke, that certain machinery and equipment would have to be imported from the Plaintiff's works in Germany and that the whole work of conversion would be completed by May 1961. The Plaintiff also undertook to train up necessary personnel for running of the said plants, there being an implied agreement that payment would only be made after the erection was completed in entirety and the machinery and equipment set up would produce dextrose of 99 % purity and so long as this was not achieved the Plaintiff's engineer or erector would remain in India to bring about the desired effect. (k) Pursuant to the said agreement various machinery and equipment were purchased by the Defendant and orders were placed with Indian manufacturers for the fabrication of other machinery and equipments. In order to house the additional machinery extensive alteration in the structures wherein the existing plants were located had to be carried out involving considerable expenditure. The total expenses under this head exceeded Rs. 1,10,000. (l) While the additional machinery and equipments were in course of fabrication and/or acquisition the Plaintiff withdrew the said engineer Mr. Staacke without any notice and in breach of the agreement and failed to train up any personnel to operate the plants. (m) As a result of the breach of contract on the part of the Plaintiff the money spent by the Defendant on the additional machinery and equipments conferred no benefit upon it and the Defendant was unable to make any dextrose at all. (n) Had the contract been performed the Defendant would have manufactured 3000 lbs. of dextrose per day on and from May 1961 and would have made a profit of 50 nP per 1b. aggregating Rs. 1500 per day. By reason of the breach of contract the Defendant was suffering damages which had accumulated to a figure exceeding Rs. 15,00,000 at the time when the written statement was filed. (o) The Defendant had been advised to file a separate suit against the Plaintiff for damages suffered. (p) In the result, no sum of money was due to the Plaintiff and it was the Defendant who had become entitled to a very large sum of money from the Plaintiff.;