T. U. MEHTA, J. ( 1 ) THIS appeal arises out of the suit filed by the appellant against the respondent-Union of India owing and representing Western Railway for the recovery of the amount of Rs. 20 0 in the court of Civil Judge S. D. Baroda where it was registered as Special Civil Suit No. 61 of 1964 The learned trial judge has partly decreed the plaintiffs suit for the amount of Rs. 5 767. 76 with proportionate costs. But since the rest of the claim of the plaintiff is disallowed the plaintiff has approached this court in this appeal. However in this appeal the plaintiff has restricted his claim only to the amount of Rs. 4 419. 85 Therefore only the particulars and merits of this claim are required to be considered in this appeal. ( 2 ) SHORT facts giving rise to this litigation are that the appellant_ plaintiff is a firm which had kept a contract from Western Railway for the supply of one lac cubic ft. of rubbles and 80 0 cubic ft. of metal and loading the same into the wagons at Zazpur Railway Station. The plaintiff carried on the work of supplying all these materials for some time. But the Railway department found that he was not supplying the materials according to the specifications. Initially the contract was to be completed on 22nd January 1961 but this period was subsequently extended upto 72nd April 1961 As the material supplied by the plaintiff was not found to be in compliance with the specifications the Divisional Engineer of the Railway rescinded the contract on 22nd July 1963 At ex. 36 is the letter written by the Divisional Engineer Baroda to the plaintiff on 22 July 1963 stating that as the plaintiff failed in supplying the approved quality of the materials in time the contract was treated as having been abandoned and was therefore terminated. This letter further stated that upon the termination of this contract the amount of security deposit taken by the railway against this work had been forfeited to the railway. ( 3 ) IT is an admitted position that originally the appellant-plaintiff had paid the amount of Rs. 1145. 00 as earnest money which was according to the terms of the contract converted into security deposit. ( 3 ) IT is an admitted position that originally the appellant-plaintiff had paid the amount of Rs. 1145. 00 as earnest money which was according to the terms of the contract converted into security deposit. Further there is no dispute about the fact that as and when running bills about the work done by the contract were passed 10 per cent of the amount of these bills were retained by the railway department as security deposit. The last running bill submitted by the plaintiff was for the amount of Rs. 6408. 62. As the contract was terminated as per the above referred letter ex. 36 the department did not make payment of the whole of this amount of this bill. Moreover on the previous running bills which were passed and paid an amount of 10 per cent was deducted and kept by the railway department with itself as the security deposit. This amount of security deposit was admittedly of Rs. 2634. 00. Thus after the termination of the contract the following three amounts were retained by the railway department: (1)RS. 1145. 00 security deposit which was converted from the earnest money. (2)Rs. 2634. 00 security deposit in form of 10 per cent deduction from the running bills. (3)Rs 6408. 62 whole amount of last unpaid bill. rs. 10187. 62 Total. THE plaintiff claims that the railway department was not entitled to retain this amount of Rs. 10 187. 62 He has therefore claimed this amount in this suit. ( 4 ) THE contention of the railway department as regards the above claim is that the total value of the suit contract was Rs. 69 267 and according to the terms of the contract the railway was entitled to retain 10 per cent of this total amount of the contract as security deposit. Therefore Rs. 6927. 00 was the amount of security deposit which the railway was entitled to keep with it for the furtherance of the contract. The railway department contends that since the contract was required to be terminated on account of the default committed by the plaintiff this whole amount of Rs. 6927. 00 became liable to be forfeited. Therefore if this amount is deducted from the above referred amount of Rs. 10 187. 62 the plaintiff would be entitled to the balance of Rs. 3260. 62. However .