Messrs. Mangilal and Co. by partner Pukraj vs Messrs. Sha Oakchand Mishrimal by their partner Jaichand

V. Ramaswami, J.—A short but important point arises for consideration in this second appeal, which has been filed by the plaintiff. The

respondents-defendants entered into a contract with the plaintiff on 22nd January 1964, agreeing to purchase two quantities of 1168 kgs Ammonia

bicarbonate made in East Germany at the rate of Rs. 100 per 50 kgs. plus sales tax payable on the same. The contract provided that the goods

agreed to be sold would be ""as per L.C. Nos. 107/20 dated 10th January 1964 for Rs. 500 and L.C. No. 107/37 dated 16th January 1964 for

Rs. 500, of Sha Kasturchand Bimraj opened by them through Mercantile Bank Ltd. Sowcarpet Branch Madras-1"". The goods produced by the

plaintiff for being taken delivery of by the defendant were actually got under L.Cs. which belonged to another company altogether, namely,

Jagannathan and Co. and not to the firm of Sha Kasturchand Bhimraj. ""L.C."" stand for ""Letters of Credit .The defendants refused to take delivery

of the goods on the ground that the goods were not as per the L.Cs. belonging to Sha Kasturchand Bhimraj, but somebody else. It is not in dispute

that the Ammonia bicarbonate which the plaintiff sought to deliver as per the contract is of ""East German origin and of the same quality as agreed

to be sold. The point for consideration is whether the defendants were entitled to reject on the ground that the goods were not as per the L.Cs. of

Sha Kasturchand Bhimraj.

A similar question arose for consideration in Bombay United Merchants'' Co. Ltd. v. Doolubram Sakulchand 12 Bom. 50. In that case the

question for consideration was, when a firm accepts a commission to order out goods from Europe at a specified rate and undertakes that the

goods will be invoiced to the indentor at that rate, does it fulfil its contract by offering to its indentor goods which it has procured in Bombay from

another house answering the description of the goods ordered through it. It was held in that case that an importing firm, which accepts a

commission to order out goods at a fixed rate and undertakes that they shall be invoiced to the person giving the order at that rate, does not fulfil

his contract by obtaining goods, answering to the terms of the order, from another firm in Bombay and tendering them to the person giving the

order and that the indentors were not bound to accept the goods offered.

In Messrs Ltd. v. Morrison''s Export Co. (1939) 1 All. E.R. 92, it was held that, where a contract for the salt of timber contained the words ""to

be loaded on deck one-third at British Columbia"" and ""shipment January and February one-third on deck"", but more than one-third was in fact

shipped, the contract upon its proper construction required that one-third only was to be placed on deck and the buyers were, therefore, entitled

to reject the goods.

In our case, the specific term of the contract was that the goods were to be imported as per L.Cs. of Sha Kasturchand Bhimraj. The defendants

placed the order for goods to be imported as per the letters of credit of Sha Kasturchand Bhimraj and if the plaintiff wanted to have the goods

imported as per the letters of credit of a different person, it amounts to a modification of the terms of the contract which requires the assent of the

defendants. It cannot be said that this clause relating to goods being imported as per the letters of credit of a particular person is not a material

condition. Being a commercial contract, the terms of the contract will have to be strictly construed. I am therefore, of the opinion that the

defendants were right in refusing to take delivery of the goods.

The suit was filed by the plaintiff for damages on the ground that the plaintiff had resold the goods at the rate far below the contract rate, and he

had claimed the difference of the amount between the contract rate and the price for which he sold the goods. The breach of contract alleged was

on 14th August, 1964 and the plaintiff sold the goods in open market long afterwards. There was no sale to the defendants at any time and,

therefore, no question of resale and claiming damages under S. 54 (2) of the Sale of Goods Act could arise. The plaintiff''s claim, if any, could only

be for damages as on the date of breach. But there is no evidence as to the market rate on the date of breach. Hence the plaintiff was not entitled

to claim any damages on the basis of a resale. In the result, the second appeal fails and it is dismissed with costs. No leave.