G.M.LODHA, J. - (1.) THIS first appeal is directed against the judgment dated 28 -9 -74 of the Additional District Judge, Sri Ganganagar in civil suit No. 8/72. The plaintiff's suit has been decreed in his favour for an amount of Rs. 9,500/ -.
(2.) THE plaintiff is a registered partnership firm carrying on grain merchant's and commission agents' business at Ganganagar. The defendant is a statutory Corporation established under Section 3 of the Food Corporation Act, 1964. The defendant has a District Office at Ganganagar which is managed by an officer called the District Manager. The plaintiff had entered into four contracts for the purchase of 4000 quintals of gram and had deposited security deposits of Rs. 4000/ - with the defendant for the due performance of the contracts. These contracts were duly performed but the defendant has refunded only a sum of Rs. 3000/ - leaving a balance of Rs. 1000/ -. The plaintiff is entitled to recover this balance of Rs. 1000/ - from the defendant. On 22 -2 -69 the plaintiff made a written offer for the purchase of 1000 quintals of gram @ Rs. 85.11 per quintal. As per condition for making the offer the plaintiff deposited Rs. 8500/ - by means of a cheque being 10% of the price of gram offered to be purchased. This offer was accepted by the defendant vide its letter dated 24 -2 -69. In pursuance of this contract the plaintiff took delivery of 300 quintals of gram on 25 -2 -69. Thus part delivery of the goods was in progress and therefore the property in all the 1000 quintals of gram passed on to the plaintiff. The defendant remained in possession of the remaining 700 quintals of gram on behalf of the plaintiff as an unpaid seller. The time fixed for the performance of the contract was 10 days from the date of the letter of acceptance but as the price of gram began to shoot up the defendant did not make the delivery of the balance quantity of 700 quintals despite oral and written requests. The defendant vide his letters dated 16 -7 -69, 16 -1 -70 and 26 -2 -70 communicated to the plaintiff that the sum of Rs. 8500/ - deposited by him had been forfeited and that he was further liable to pay a sum of Rs. 3577/ -as damages suffered by the defendant. According to the plaintiff, the defendant is not entitled to forfeit the said sum of Rs. 8500/ - or to recover notional loss of Rs. 3577/ -. The amount of Rs. 8500/ - was deposited as a precondition for making offer and it was not an earnest money and, therefore, not liable to be forfeited. There was no breach on the part of plaintiff and therefore, the defendant was not entitled to make any forfeiture or recover any loSections Even on the breach of the contract by the plaintiff, the defendant was only entitled to resell the goods and recover the loss if any. In the present case the defendant did not suffer any loss and was, therefore, not entitled to recover any damages. The breach of contract, if any, by the plaintiff took place on 6 -3 -69 and the rate of gram prevailed in the market on this date was the same as contracted by the plaintiff. The defendant did not suffer any damages. The stipulation regarding the forfeiture of earnest money was penal in nature. The plaintiff has, therefore, brought the suit for the refund of Rs. 1000/ - deposited in respect of the previous contracts, Rs. 8500/ - deposited in respect of the contract dated 24 -2 -69 and Rs. 2500/ - as past interest on those two amounts. The defendant in its written statement has admitted to have entered into the five contracts with the plaintiff. The fact that the security deposit of Rs. 1000/ - is due and recoverable from the defendant has also been admitted. Regarding the balance sum of Rs. 8,500/ -, it has been pleaded that the plaintiff, by not depositing the balance price of the balance quantity of 700 quintals of gram had committed the breach of contract and the defendant under the terms and conditions of the contract was entitled to forfeit the earnest money and also to recover loss suffered. The amount of Rs. 8,500/ - was deposited not as a pre -condition of an offer but as an earnest money and was, therefore, liable to be forfeited in the event of breach of contract by the plaintiff. Since plaintiff failed to take the delivery of the remaining 700 qtls. of gram upto 30 -4 -1969, he was liable for the loss occasioned by such breach. The market rate prevailing on 30 -4 -1969 was Rs. 50/ - per quintal and the plaintiff was, therefore, liable to pay the damages amounting to Rs. 3,577/ -. It has further been pleaded that there is an arbitration clause in the agreement and, therefore, the Civil Court has no jurisdiction to entertain the suit.
(3.) THE following issues were framed in the suit; (1) Whether the sum of Rs. 8,500/ - was not deposited as earnest money but as the precondition of offer? (2) Whether the defendant is not entitled to forfeit the sum of Rs. 8,500/ - as given in para 10 of the plaint? (3) Whether the plaintiff was ready and willing to perform the contract? (4) What was the date of breach of contract, if any? (5) Whether the defendant suffered a loss of Rs. 3,577/ -? (6) Whether the plaintiff is entitled to any interest, if so at what rate? (7) Whether the court has no jurisdiction to try the suit? (8) Relief? ;