JUDGMENT : SANGEETA K. VISHEN, J. 1. The captioned appeals have been filed by the appellant, details whereof are as under:- 1.1 The First Appeal No.4105 of 1996 and First Appeal No.4108 of 1996 pertain to the tender with respect to Veraval Port, Jamnagar and have been filed by the appellant challenging the common judgment and decree dated 4.5.1996 whereby the Civil Judge (Senior Division), Jamnagar allowed the Special Civil Suit No.145 of 1996 of the respondent – original plaintiff and awarded Rs.33,84,210/- together with interest and dismissed the Special Civil Suit No.111 of 1996 filed by the appellant – original plaintiff for recovery of Rs.5,30,964.04 respectively. 1.2 The First Appeal No.4106 of 1996 and First Appeal No.4107 of 1996 pertain to the tender with respect to Rozi Port, Jamnagar and have been filed by the appellant challenging the common judgment and decree dated 4.5.1996, whereby, the Civil Judge (Senior Division), Jamnagar allowed the Special Civil Suit No.166 of 1990 filed by the respondent – original plaintiff and awarded Rs.30,43,832.00 together with interest and dismissed the Special Civil Suit No.113 of 1991 filed by the appellant – original plaintiff for recovery of Rs.32,11,061.65 respectively. 2. The learned counsel for the respective parties have made common submissions for all the above referred appeals. The issues involved in the above-referred first appeals being common, all the appeals are being heard together and they are being disposed of by this common judgment. 3. So far as First Appeal No.4105 of 1996 and First Appeal No.4108 of 1996 are concerned, the same pertain to the Veraval Port and the relevant facts as discernible from the record are as under:- 3.1 The appellant, that is, Food Corporation of India (hereinafter referred to as “the appellant corporation”) is a body corporate established under the provisions of Section 3 of the Food Corporation Act, 1964, whereas, the respondent is a partnership firm carrying business of Stevedoring, Clearing, Handling and Transport Contractors etcetera and is a registered partnership firm under the provisions of the Indian Partnership Act, 1932 (hereinafter referred to as “the respondent contractor”). 3.2 The appellant corporation on 13.6.1988 issued a tender notice for appointment of Stevedoring, Clearing, Handling and Transport Contractors for discharging foodgrains etcetera from steamers at Veraval Port for a period of one year, that is, from 30.8.1988 to 29.8.1989. 3.2 The appellant corporation on 13.6.1988 issued a tender notice for appointment of Stevedoring, Clearing, Handling and Transport Contractors for discharging foodgrains etcetera from steamers at Veraval Port for a period of one year, that is, from 30.8.1988 to 29.8.1989. Apropos the said tender notice, M/s. Velji P. & Sons, that is, the respondent contractor – original plaintiff in Special Civil Suit no.145 of 1990 submitted its tender in the prescribed form on 16.6.1988 offering to carry out the various services laid down in the tender form. 3.3 Thereafter, on 30.8.1988, the appellant corporation issued a work order in favour of the respondent contractor, who completed the work for loading and transportation of the foodgrains from a total of five ships/vessels at Veraval Port and it had rendered other allied services to the appellant corporation for the period during 30.8.1988 to 29.8.1989. 3.4 On 12.9.1988, the respondent contractor addressed a communication to the Port Officer, Veraval, inter alia, informing the appellant corporation that the vessel m.v Endurance Sea is due to reach the port on or around 15.9.1988 and therefore, the appellant corporation may arrange for adequate barges, tugs and transit sheds for discharge of 2500 metric tons per day and in order to meet the above requirement, the facilities as indicated therein may be made available. 3.5 In response to the said communication dated 12.9.1988 of the respondent contractor, the Port Officer, Gujarat Maritime Board, Veraval addressed a communication dated 12.9.1988, inter alia, informing that looking to the position of the fleet and other facilities, the demand raised vide the said communication dated 12.9.1988 of the respondent contractor, cannot be acceded to with reference to only one vessel by suppressing the demand and right of the other senior vessels. It was also informed that upon review of the traffic at the port, the food grain vessels will definitely be allotted the port facilities in preference to other vessels at the port to the extent it was possible. 3.6 It is thereafter that the respondent contractor addressed another communication dated 16.9.1988 to the Assistant Manager of the appellant corporation, inter alia, informing that the vessel m.v Endurance Sea has commenced unloading and it was allotted only 8 barges despite the requirement of 22 barges for the said work. Concern was raised that in such circumstances, it was very difficult to maintain the discharge rate of 2500 metric tons. Concern was raised that in such circumstances, it was very difficult to maintain the discharge rate of 2500 metric tons. 3.7 The aforesaid communication was followed by another communication dated 17.9.1988 by the respondent contractor, inter alia, stating that despite the request to provide adequate empty barges, only 8 barges were allotted to it for discharging the foodgrains and thus, the respondent contractor may not be held responsible in detention on board or on shore. Thereafter, on 19.9.1988, the respondent contractor addressed yet another communication reiterating its request for providing adequate number of barges, tugs and shore cranes so as to enable it to achieve the desired discharge rate. 3.8 Accordingly, the Assistant Manager of the appellant corporation addressed a communication dated 20.9.1988 to the Port Officer, Veraval Port, Veraval, inter alia, requesting that in order to meet the discharge rate, the Port Officer may provide to its stevedores, that is, the respondent contractor, the facilities viz. (i) 22 number of port barges, (ii) 3 number of tugs for towing barges, (iii) 7 number of shore cranes and (iv) transit sheds/wharf area at the ports for 3500/4500 metric tons capacity. The Port Officer, Veraval Port addressed a communication dated 21.9.1988 to the Assistant Manager of the appellant corporation inter alia informing that the facilities as required vide the communication dated 20.9.1988 of the Assistant Manager of the appellant corporation do exist at the port; however, it cannot be given extensively to one vessel. 3.9 According to the respondent contractor before the Trial Court, the impossibility of maintaining discharge rate of 1500 metric tons per day in case of dry cargo vessels and 2500 metric tons per day in case of bulk carriers under the existing facilities was pointed out to the appellant corporation right from the beginning. Since the appellant corporation did not redress the grievance nor did it take any action for providing necessary infrastructure and/or facilities to the respondent contractor to maintain the discharge rate, and apprehending that it would hold the respondent contractor financially liable for its own acts of omission, it preferred a writ petition being Special Civil Application No.6765 of 1988, inter alia, praying for direction to the appellant corporation; however, this court disposed of the writ petition with a direction to the respondent contractor to make representation to the Managing Director of the appellant corporation. This court also directed the Managing Director of the appellant corporation to decide the representation by speaking order and restrained the appellant corporation from recovering any demurrage charges more than the actual, if any, which the corporation was required to pay to the vessel till the decision of the Managing Director. Apropos the aforesaid order dated 11.10.1988 passed by this court, the respondent contractor submitted a detailed representation to the Managing Director on 15.10.1988. 3.10 As is discernible from the record, the representation dated 15.10.1988 made by the respondent contractor to the Managing Director of the appellant corporation came to be decided vide an order dated 6.3.1990 whereby, request and the grievance raised by the respondent contractor came to be rejected. So far as the impossibility to fulfill the discharge rate of 1500 metric tons for dry cargo and 2500 metric tons for bulk cargo is concerned, it was held that discharging metric tons of wheat cannot be said to be impossible to achieve inasmuch as, it was made clear in the tender notice that imported wheat had to be cleared as quickly as possible and considering the respondent contractor, being a big and experienced contractor, who could command a sufficient resource for clearance, it was entrusted the work. So far as the communication dated 12.9.1988 about the requirement of facilities was concerned, it was held that the said requirement was misleading, in that it stipulated a discharge of 2500 metric tons which is applicable to bulk carrier vessels and that the respondent contractor was to handle only dry cargo vessel and therefore, the stipulated rate was 1500 metric tons per day. 3.11 The District Manager of the appellant corporation issued a communication dated 6.4.1990, inter alia, informing that as per the contract, the respondent contractor was supposed to discharge minimum quantity of 1500 metric tons per day on all days including holidays, failing which entire liability of ship demurrage calculated on the basis of the stipulated rate of discharge irrespective of charter party rate, would be on the account of respondent contractor. It was further stated that the respondent contractor has not been able to maintain the stipulated rate of 1500 metric tons per day in respect of first four vessels arrived at Veraval with the result, vessels have incurred notional ship demurrage and thus, it required the respondent contractor to make good the loss of Rs.4,72,731.54 suffered by the appellant corporation on account of failure on the part of the respondent contractor. 3.12 The respondent contractor submitted its response vide its communication dated 16.5.1990, inter alia, informing that as per the terms and conditions of the tender document, the contractor was responsible only for providing sufficient labour gang on the board of the vessel for performing the stevedoring work etcetera and that the contractors have been exempted from making the payment to the authorities with respect to wharfage and lighterage and thereby, it was the appellant corporation to have made available to the contractor sufficient number of barges/tugs, shore cranes, PLSC labour gangs, ship sheds/wharf by making payment directly to the Port Authorities or by any other means. It also stated that though the Port Officers were requested to provide the facilities so as to achieve the stipulated discharge rate, it was categorically informed by the Port authority that the facilities required cannot be allotted. Lastly, it has been stated by the respondent contractor that in absence of the necessary facilities/infrastructure provided by the Port authorities, that the rate of discharge could not be achieved due to the circumstances beyond the control and due to factors akin to vis-major. 3.13 After receipt of the aforesaid communication dated 16.5.1990 of the respondent contractor, the appellant corporation issued a communication dated 27.7.1990 raising a final demand requiring the respondent contractor to pay an amount of Rs.4,72,731.54 towards loss of lay time with respect to four vessels. The total demand raised by the appellant corporation was for an amount of Rs.4,85,905.41; however, the appellant corporation after deducting an amount of Rs.13,173.87, that is, the 50% share of dispatch money earned by the respondent contractor for vessel m.v Silver Sea, raised the final demand as aforesaid. 3.14 The work as per the contract was completed and after completion, the respondent contractor demanded the payment totaling to the tune of Rs.34,26,178.73 on various occasions. 3.14 The work as per the contract was completed and after completion, the respondent contractor demanded the payment totaling to the tune of Rs.34,26,178.73 on various occasions. Finally vide its communication dated 14.7.1990 followed by a registered notice dated 26.8.1990 it called upon the appellant Corporation to pay the aforesaid amount together with interest thereon at the rate of 18% per annum failing which it would be construed that the appellant corporation has neglected to comply with the said demands. Thereafter, the respondent contractor on 6.9.1990, filed the Special Civil Suit no.145 of 1990 claiming the total amount of Rs.34,26,178.73 as detailed in the plaint. 3.15 Subsequently, the appellant corporation issued two notices, both dated 18.1.1991, requiring the respondent contractor to pay the amount under the different heads viz. (i) the loss suffered by the Corporation, due to damage to 51 bags USA red wheat, for an amount of Rs.9,277/-, (ii) the loss of Rs.48,936.60 suffered due to 280 bags imported wheat received short at various destinations. 3.16 It is thereafter, that the appellant corporation filed the Special Civil Suit No.112 of 1991, inter alia, praying for an amount of Rs.4,72,731.54 towards loss of lay time; Rs.9,277.20 for recovery towards the loss sustained due to 51 bags USA red wheat in damaged condition and Rs.48,936.60 towards destination shortage of 280 wheat bags. The appellant corporation in all prayed for an amount of Rs.5,30,969.04 against the respondent contractor. 3.17 The Trial Court as aforesaid vide common judgment dated 4.5.1996 allowed the Special Civil Suit No.145 of 1990 holding that the respondent contractor – original plaintiff is entitled to recover an amount of Rs.33,84,201.27 under different heads together with interest at the rate of 18%. The Trial Court also vide the said common judgment, dismissed the Special Civil Suit No.112 of 1991 filed by the appellant corporation for recovery of Rs.5,30,969.04. Being aggrieved, the appellant corporation has filed the abovereferred First Appeal Nos.4105 of 1996 and 4108 of 1996, challenging the said common judgment dated 4.5.1996 with respect to the contract for Veraval Port. 4. Mr. Jal Unwala, learned senior advocate, appearing with Ms. Tejal Vashi, learned advocate for the appellant corporation submitted that the appellant had issued a tender notice dated 13.6.1988 and the last date for receipt of the tender was upto 2 p.m. on 16.6.1988. 4. Mr. Jal Unwala, learned senior advocate, appearing with Ms. Tejal Vashi, learned advocate for the appellant corporation submitted that the appellant had issued a tender notice dated 13.6.1988 and the last date for receipt of the tender was upto 2 p.m. on 16.6.1988. It is thereafter that the tenders were opened on 16.6.1988 and the respondent contractor emerged as a successful bidder. The tender was for Stevedoring, Clearing and Handling of all or a portion of corporation foodgrains, flours, food products, sugar and fertilizer etcetera arriving in bulk or bags. The services required to be performed under the contract were categorized in eight parts viz. Part-I for Stevedoring and Bagging in the holds of the Vessels; Part-II Clearings and Transport of Foodgrains arriving in Bulk by Sea; Part-III Clearings and Transport of Foodgrains arriving in Bags by Sea; Part-IV Export of Foodgrains etcetera by Sea; Part-V Clearings and Transport of Gunny/Twine based Bales received and dispatched; Part-VI Supply of Casual Labour; Part-VII Handling of Miscellaneous Articles; Part-VIII Handling and Transport Work on Storage Depot. 4.1 It is further submitted that as per the contract, the term “services” has been defined to mean the performance of any of the items of work enumerated in the schedule of services and elaborated in clause XX including such auxiliary and incidental duties, services and operations as may be indicated by the Regional Manager, Ahmedabad. It is then submitted that clause XI of the tender provides for the period of the contract to remain in force for one year from the date of appointment or such earlier/later date as may be decided by the Senior Regional Manager. In the present case, the contract was for a period from 30.8.1988 to 29.8.1989. While referring to clause XX of the tender condition, it is submitted that the said clause provides for services to be performed by the contractors. As per the said clause, the contractor shall carry out all items of services assigned or entrusted to them by the Senior Regional Manager of the appellant corporation from time to time and it was incumbent upon the contractor to render the services to the satisfaction of the Senior Regional Manager together with such auxiliary and incidental duties, services and operation as may be indicated by the officer of the appellant corporation. While referring to Part-I of clause XX titled “for Stevedoring and Bagging in the holds of the vessels”, it is submitted that the contractor shall discharge the foodgrains in bulk/foodgrains bags (including sweepings and spillings) from the ship into lighter and/or on wharf carefully and expeditiously and arrange to complete discharge in the minimum period possible. It shall take all necessary steps to prevent the ship from going under demurrage and to earn maximum amount of dispatch money. It is further submitted that as per sub-clause (i) of Part-I of clause XX, it was incumbent upon the contractor to arrange for discharge of minimum quantity of 1500 metric tons per day in case of dry cargo and 2500 metric tons per day in case of bulk carriers/tankers on all days including holidays, Saturdays/Sundays. It is further submitted that as per the said clause, entire liability of the ship demurrage calculated at the stipulated rate of discharge per weather working day irrespective of the charter party rates of discharge, would be on the contractor whereas, dispatch money was to be shared equally between the corporation and the contractor. 4.2 It is further submitted that clause (iii) of Part-I further provides that the contractors shall make necessary arrangement for the use of ships or port gear and/or ship winches required for the discharge of the foodgrains and pay any charges incurred for hiring the gear. It also provides that the contractor shall use ship winches with their own labour to expedite the discharge, if such use of winches is not prohibited by the customs and the law of ports. It is further submitted that sub-clause (vii) of clause XX provides that the contractor shall be required to fill the bulk foodgrains in empty bags supplied for the purpose by the corporation and stitch them. 4.3 It is next submitted that Part-II of clause XX titled “for Clearings and Transport of Foodgrains arriving in Bulk by Sea” is a clause providing for duties of the contractor. 4.3 It is next submitted that Part-II of clause XX titled “for Clearings and Transport of Foodgrains arriving in Bulk by Sea” is a clause providing for duties of the contractor. It is further submitted that Part-II obliges a contractor to obtain all clearings and a duty is cast to watch and safeguard the interest of the corporation during the discharge of foodgrains by stevedores from the ships to the quay into lighters and barges, filling of bulk grains in the bags on the quay by the port contractors and the handling of bags by port labour from quay to transit sheds. It is submitted that sub-clause (ix) provides for the payment of port, customs and railway charges such as wharfage, lighterage, cranage, launch hire for towing barges from ship to shore, wagons hire survey fees, overtime fees etcetera to be paid to the Port and Railway authorities directly by the corporation. 4.4 While further relying upon Part-VII of the tender condition “For Handling of Miscellaneous Articles” and more particularly sub-clause (ii), it is submitted that in the event of any supply of the articles being damaged or short delivered, the contractors shall arrange the necessary survey and file claim within the time allowed and that the contractor shall be liable to make good the corporation any loss resulting from its failure to file the claim in time. 4.5 It is further submitted that clause-XXI of the tender document relevant for the present purpose and titled “duties and responsibilities of the contractors” clearly provides that the contractors shall carry out all items of services assigned or entrusted to them by the officer of the appellant corporation. Pointed attention has been invited to clause (v) to submit that as per the said clause, the contractor shall be responsible for taking all steps necessary to ensure prompt discharge from the steamers and removal of cargo from the ships without incurring any demurrages. Pointed attention has been invited to clause (v) to submit that as per the said clause, the contractor shall be responsible for taking all steps necessary to ensure prompt discharge from the steamers and removal of cargo from the ships without incurring any demurrages. It further provides that the contractor shall be responsible for any demurrage or wharfage charges that may occur for payment by the corporation to Railways, Port or any other party on account of the delay on their part, of which, Senior Regional Manager, Ahmedabad will be the sole judge and his decision shall be binding on the contractors to complete the loading etcetera within the very time allotted or due to the delay in supplying sufficient labour for loading or unloading wagons etcetera and the same shall be recouped by them either by each payment or by adjustment from their outstanding bills or from security deposit. It is next submitted that as per clause (6) of clause XXI, the contractor shall be responsible for making necessary arrangements for the storage of foodgrains, gunnies, twine etcetera and shall hire godowns if directed by the appellant corporation. 4.6 It is submitted that the terms and conditions of the contract were clear and unambiguous and the contract was accepted by the respondent contractor with its eyes open, in spite of the order dated 6.3.1990, passed by the Managing Director of the appellant corporation rejecting the representation of the respondent contractor dated 15.10.1988, inter alia, raising grievance of impossibility of achieving the discharge rate of 1500 metric tons/2500 metric tons per day. 4.7 It is then submitted that the appellant corporation raised a final demand vide its letter dated 27.7.1990 (Exhibit 40) in continuation of its show cause letter dated 6.4.1990 (Exhibit 41) fixing the liability of the respondent contractor towards ship demurrage amounting to Rs.4,85,905.41 inasmuch as, as per the contract clause XX (i), the respondent contractor was required to maintain minimum discharge rate of 1500 metric tons in case of dry cargo vessel on all days including holidays/Saturdays and Sundays. It is further submitted that even though infrastructural facilities were available on Veraval Port, the respondent contractor had failed to maintain minimum discharge rate of 1500 metric tons per weather working day as stipulated in the contract. It is further submitted that even though infrastructural facilities were available on Veraval Port, the respondent contractor had failed to maintain minimum discharge rate of 1500 metric tons per weather working day as stipulated in the contract. In the said demand notice, it was pointed out that owing to the failure on the part of the respondent contractor to maintain discharge rate, the appellant corporation has lost lay time in four out of five vessels handled by the respondent contractor to the extent of Rs.4,85,905.41. That in accordance with the terms and conditions of the contract, benefit of 50% share of dispatch money earned by one of the vessels, viz. m.v Silver Sea, that is, Rs.13,173.87 was allowed to the respondent contractor. 4.8 It is further submitted that since the respondent contractor could not adhere to the terms and conditions of the contract, the appellant corporation issued a show cause letter dated 18.1.1991 (Exhibit 34) with respect to the losses suffered by it due to damage of 51 bags USA red wheat weighing 4590 metric tons. As per the said notice, the liability of the respondent contractor was assessed and fixed for the losses amounting to Rs.9,277.20. It is further submitted that similarly, another show cause letter dated 18.1.1991 (Exhibit 35) was issued to the respondent contractor for the losses of Rs.48,936.60 being the cost of 180 bags imported wheat short received at various destinations within the region and suffered by the appellant corporation. Therefore, as per the terms and conditions of the contract, responsibility of the respondent contractor was fixed for losses amounting to Rs.48,936.60. 4.9 The respondent contractor being aggrieved thereby, preferred Special Civil Suit No.145 of 1990 for a decree of Rs.35,10,000/- together with interest thereon at 18% per annum. It is further submitted that by way of the said Special Civil Suit no.145 of 1990, the respondent contractor had claimed an amount of Rs.34,26,178.73, the details whereof were provided in paragraph 11 of the plaint below various heads viz. It is further submitted that by way of the said Special Civil Suit no.145 of 1990, the respondent contractor had claimed an amount of Rs.34,26,178.73, the details whereof were provided in paragraph 11 of the plaint below various heads viz. (i) Rs.11,72,680.35 towards the amount withheld from running bill; (ii) Rs.4,35,000/- towards the amount of security deposit; (iii) Rs.4,35,000/- towards amount deducted from submitted bill and credit as security deposit; (iv) Rs.20,662.15 towards amount wrongfully deducted as destination shortage; (v) Rs.4,51,685.70 towards amount wrongfully disallowed by the appellant corporation; (vi) Rs.6,97,136/- towards services rendered as per the statement attached at Annexure-E; and (vii) Rs.6,14,024.53 towards 50% amount of dispatch money earned by the corporation on five vessels as per the statement appended at Annexure-F. 4.10 It is further submitted that the respondent contractor had only examined one witness, namely, Shri Yagneshkumar Babulal Vithalani at Exhibit 111, who was not a party and was not present when the work was undertaken. In fact, the said witness in his deposition has stated that the discharge of 1500 metric tons per day can be maintained and that for one ship discharge rate of about 1500 metric tons was maintained in case of bulk cargo. The said witness in his cross-examination has categorically stated that he was aware about the facilities at the port and at present, the respondent contractor can maintain 1500 metric tons per day discharge rate. It is further submitted that as against this, the appellant corporation has examined its witness at Exhibit 158, namely, Girjashanker Umashanker Bhatt, who was a natural witness and was working at Veraval Port for many years. It is further submitted that the said witness has categorically stated that the respondent contractor had carried out the work with five steamers; however, the respondent contractor could not achieve the dispatch rate of 1500 metric tons per day except one steamer, namely, m.v Silver Sea. It is submitted that the said witness in his deposition has stated that by not adhering to the dispatch rate of 1500 metric tons per day, the respondent contractor has committed breach of the contract and thus, cannot claim any amount as prayed for. It is submitted that the said witness in his deposition has stated that by not adhering to the dispatch rate of 1500 metric tons per day, the respondent contractor has committed breach of the contract and thus, cannot claim any amount as prayed for. 4.11 The learned counsel for the appellant corporation then took the court to the observations and findings of the Trial Court to submit that the Trial Court did not consider that the respondent contractor was under an obligation to discharge minimum of 1500 metric tons of cargo under the terms of the contract itself and that the respondent contractor had entered into the said contract with its eyes open and was aware about the implications. It is further submitted that in fact, the respondent contractor had the experience in such stevedoring contracts in the past and that the respondent contractor was fully cognizant with the prevailing conditions. It is contended that the Trial Court ought to have appreciated that it was not open to it to rewrite the terms of the contract and by decreeing the suit, the Trial Court has in fact, rewritten the terms of the contract and that in fact, it ought to have been appreciated that the contract entered into between the parties is clear and binding and that there was no scope for interference by the court. 4.12 It is further submitted that the appellant corporation had incorporated various discharge rates in the charter party agreement with the owners of the vessels where, the discharge rate provided was 1000 metric tons, that is, less than 1500 metric tons per day as provided in the contract executed between the parties. The Trial Court ought to have appreciated that it was a part of the contract between the respective parties; however, so far as the present contract is concerned, it was agreed that the respondent contractor will achieve the dispatch rate of 1500 metric tons per weather working day. It is further submitted that before the Trial Court, it was a specific case of the appellant corporation that in one steamer, the contractor had in fact discharged 1500 metric tons per weather working day and that the said fact itself proves that on the Veraval Port discharge of 1500 metric tons per working weather day was possible and the same destroys the case of the respondent contractor regarding impossibility. It is further submitted that if the contention of the respondent contractor is believed that the infrastructural facilities were not provided so as to enable the respondent contractor to achieve dispatch rate of 1500 metric tons per weather working day, then, it was very much open and available to the respondent contractor to have rescinded the contract; however, it did not do so. 4.13 It is submitted that the Trial Court ought to have appreciated that it was the duty of the respondent contractor to utilize maximum capacity of barges and to provide adequate labours to achieve 1500 metric tons per weather working day, but in the present case, the respondent contractor failed to achieve the discharge rate and has failed to perform its contractual obligation and considering the same, it is clear that due to inability on the part of the respondent contractor and poor working condition of the contractor, the 1500 metric tons per day discharge rate could not be achieved. As a consequence, the respondent contractor should suffer the same and should reimburse the expected profit to the appellant corporation as per the principle laid down by the Apex Court in the case of A.T. Brij Paul Singh & Ors. vs. State of Gujarat reported in AIR 1984 SC 1703 . It is further submitted that the appellant Corporation suffered a loss with respect to the expected profit which it would have earned had the respondent contractor maintained the dispatch rate of minimum 1500 metric tons/2500 metric tons, as the dispatch money earned was directly related to the rate of discharge. 4.14 It is further submitted that in fact, the Trial Court was swayed away by the fact that the appellant corporation did not pay the actual demurrage to the ship owners. What has been lost sight of by the Trial Court is that the amount retained by the appellant corporation represents a loss suffered by it in terms of money which it could have earned as a result of early release of vessels. 4.15 It is further submitted that the Trial Court misdirected itself by applying principle of impossibility of performance of contract, which was the basis of the claim of the respondent contractor. 4.15 It is further submitted that the Trial Court misdirected itself by applying principle of impossibility of performance of contract, which was the basis of the claim of the respondent contractor. The Trial Court ought to have appreciated that the contract was not impossible to perform, firstly, on the ground that in case of one vessel, the respondent contractor had in fact managed to achieve the required discharge rate of 1500 metric tons per day and secondly, the witness examined on behalf of the respondent contractor had conceded to the fact that the respondent contractor had achieved the rate of 1500 metric tons per day and that it was capable of doing the same now. It is submitted that if the respondent contractor was of the opinion that the rate prescribed is onerous it was very well open to the respondent contractor to have rescinded the contract at its own option. In fact, the respondent contractor from the very beginning had tried to escape from the discharge rate provisions of the contract. Even before the actual execution of the contract, the respondent contractor had made representation, inter alia, indicating the so-called difficulty in maintaining the discharge rate. This itself suggests that the respondent contractor was very much aware of the so-called difficulty from the very beginning. The respondent contractor being aware, now cannot be heard to say that it could not be bound by the terms of the contract which it had with its eyes open entered into by its own freewill. Thus, the respondent contractor had acquiesced to the performance of its contract. 4.16 It is further submitted that the calculation of dispatch money and the payment to be made to the respondent contractor was very much dependent upon the minimum discharge rate stipulated in the tender agreement. Thus, the respondent contractor was not entitled to earn dispatch money as it failed to maintain the minimum discharge rate as provided under clause XX of the tender document. The same was a part of the contract between the parties herein and that the dispatch money that may be earned by the appellant corporation would be divided equally between the appellant corporation and the respondent contractor. The same was a part of the contract between the parties herein and that the dispatch money that may be earned by the appellant corporation would be divided equally between the appellant corporation and the respondent contractor. It is further submitted that it was the case of the appellant corporation before the Trial Court that the dispatch money calculation and the payments to be made to the contractor was dependent upon the minimum discharge rate stipulated in the tender irrespective of discharge rate quoted in the charter party agreement. It is further submitted that the Trial Court failed to appreciate that the two agreements were independent and that no reliance could have been placed on the terms and conditions of the charter party agreement executed between the appellant corporation on one hand and the ship owner on the other. It is submitted that the Trial Court ought to have appreciated that the suit is filed after completion of the contract work and at a belated stage and on that ground also, the suit should not have been entertained by the Trial Court. 4.17 Reliance has been placed by the learned counsel for the appellant corporation on the judgment in the case of Indian Council for Enviro Legal Action vs. Union of India & Others reported in (2011) 8 SCC 161 . It is submitted that the Trial Court completely ignored the case pleaded and proved by the appellant corporation that it had a valid claim of Rs.5,30,969.04 against the respondent contractor viz. Rs.9,277/- towards recovery of 51 bags of US red wheat found in damaged condition; Rs.48,936.60 towards destination shortage of 280 wheat bags short supply and Rs.4,72,731.54 towards non-earning of dispatch money. It is submitted that the Trial Court ought to have appreciated that the respondent contractor had not produced or proved any bills of work or account of money due and payable and thus, it was not possible for the Trial Court to have given finding in favour of the respondent contractor. It is next submitted that the Trial Court had wrongly come to the conclusion that the respondent contractor had proved its case inasmuch as, it failed to discharge the burden of proof and it had not produced any evidence worth the name with respect to incurring extra expense for double stitching etcetera as claimed by it in the plaint. It is next submitted that the Trial Court had wrongly come to the conclusion that the respondent contractor had proved its case inasmuch as, it failed to discharge the burden of proof and it had not produced any evidence worth the name with respect to incurring extra expense for double stitching etcetera as claimed by it in the plaint. As against this, the appellant corporation had produced sufficient documentary evidence to show that certain goods were short delivered and that certain goods were in damaged condition. 4.18 It is next submitted that even otherwise in view of the fact that this court had passed an order permitting the respondent contractor to withdraw the writ petition with a direction to it to make a representation to the Managing Director of the appellant corporation; however, no liberty of filing the suit was reserved in its favour while disposing of the writ petition and thus, the respondent contractor was precluded from praying for any relief in any other proceedings including the suit. Further, the order dated 6.3.1990 passed by the Managing Director of the appellant corporation was a speaking order and that the respondent contractor had not challenged the said order dated 6.3.1990 passed by the Managing Director of the appellant corporation nor any claim has been sought for. Considering the said lapse, the Trial Court ought to have dismissed the suit. It is further submitted that the Trial Court had failed to appreciate the purport of the order dated 6.3.1990 passed by the Managing Director of the appellant corporation and that the contents in the plaint of the suit were known and that the relief ought not to have been granted by the Trial Court ignoring the same. It is further submitted that the Trial Court ought to have appreciated that, the representation dated 22.7.1988 (Exhibit 70), inter alia, raising a grievance that the prescribed discharge rate was not possible to achieve or maintain and when the said demand for modification was not acceded to by the appellant corporation; followed by filing of writ petition, restraining the appellant corporation from enforcing the discharge and the respondent contractor having been compelled to withdraw the petition, it was not permissible to the respondent contractor to have re-agitated the issue by filing the suit. The Trial Court ought to have rejected the suit on this ground as well. The Trial Court ought to have rejected the suit on this ground as well. In view of the above submission, it is prayed that the judgment and decree dated 4.5.1990 passed by the learned Civil Judge (Senior Division), Jamnagar, deserves to be quashed and set aside. 5. Per contra Mr. Mehul S. Shah, learned senior advocate, with Mr. Premal Rachh, learned advocate for the respondent contractor at the outset submitted that the issues involved in the present group of appeals, are required to be determined in light of the aspects, viz. (i) whether any breach is committed by the respondent contractor; and (ii) whether any damage is resulted because of the alleged breach and even if there is any damage, whether there is any entitlement of the claim in the facts of the case. It is further submitted that such aspects are required to be satisfied by the appellant corporation for making out a case. The learned counsel submitted that the respondent contractor had preferred Special Civil Suit No.145 of 1990 praying for decree for Rs.35,10,000/- including interest. It is submitted that the total amount due to the respondent contractor from the appellant corporation was to the tune of Rs.34,26,178.73 and further break-up has been detailed in paragraph 11 of the plaint. It is further submitted that an amount of Rs.11,72,680.35 as well as security deposit of Rs.8,70,000/-, were withheld towards the alleged claim of damages and more particularly, demurrage. It is further submitted that Rs.20,662.15 was wrongfully deducted as the destination shortage and Rs.51,685.70 was disallowed by the appellant corporation. It is further submitted that so far as an amount of Rs.6,97,126/- is concerned, the same was towards the service rendered and that the respondent contractor was entitled for the actual payment. Similarly, Rs.6,14,024.53 was claimed towards 50% amount of dispatch money earned by the corporation on five vessels. While referring to paragraph 75 of the judgment dated 4.5.1990 under challenge, it is submitted that the Trial Court has against the claim of Rs.34,26,178.73 allowed the claim of Rs.33,84,201.27 together with interest at the rate of 18% per annum. 5.1 The learned counsel while inviting the attention of the court to page no.125 of the paper-book of Special Civil Suit No.112 of 1991 submitted that the services required to be performed under the contract have been divided into eight parts. 5.1 The learned counsel while inviting the attention of the court to page no.125 of the paper-book of Special Civil Suit No.112 of 1991 submitted that the services required to be performed under the contract have been divided into eight parts. It is submitted that all the categories are part of the service contract and the rates were required to be quoted, which it did so and accordingly, the tender was awarded. It is further submitted that as per clause (v), the security deposit was furnished by the respondent contractor. While inviting the attention to clause XI governing the security deposit, it is submitted that as per sub-clause (e) security deposit was to be refunded to the contractor on true and satisfactory services and on completion of all obligation by the contractor under the terms of the contract and on admission of “no demand certificate”, subject to such deduction from the security deposit as may be necessary for making up corporation’s claim against the contract. It is submitted that the deduction from the security deposit was permissible to the corporation against the claim but as per the contract. 5.2 It is submitted that clause XII provides for liability of contractor for losses suffered by the corporation. It is submitted that if the corporation satisfies that it has suffered such loss and that the losses contemplate incurring of demurrage etcetera; that would be something, which the appellant corporation would be entitled to recover. As per the said clause, the contractor was liable for all costs, damages, demurrage, wharfage charges and expenses suffered or incurred by the corporation due to the contractor’s negligence and unworkman like performance of any services under the contract or breach of any terms thereof. It is submitted that sub-clause (a) titled “Set Off” provides that any sum of money due and payable to the contractor including security deposit returnable to them under the contract may be appropriated by the corporation and set off against any claim of the corporation for the payment of any sum of money arising out of or under other contract made by the contractor with the corporation. It is further submitted that sub-clause (b) provides that the corporation shall be at liberty to reimburse themselves to any damages, losses, charges, costs or expenses suffered or incurred by them due to contractor’s negligence, unworkman like performance of services under the contract or breach of any term thereof. It also provides that total sum claimed shall be deducted from any sum then due or which at any time becomes due to the contractor under the contract with the corporation. In this behalf, it is submitted that as the said clause entitles the corporation to set off; however, the same should not be uncertain claim or unadjudicated claim but has to be adjudicated claim. It necessarily means that the same should be due and payable otherwise, it would fall within the realm of uncertainty. 5.3 It is further submitted that as is evident from sub-clause (b) of clause XII of the contract, it provides that the corporation shall be at liberty to reimburse itself of any damages, losses, charges or expenses suffered or incurred by them due to the contractor’s negligence. Thus, there has to be sufferance and incurrence of any damages to the corporation owing to the negligence or unworkman like performance of the services under the contract or breach in terms thereof by the contractor. While referring to clause XVII which deals with the aspect of payments, it is submitted that sub-clause (g) makes the provision that the corporation shall not be liable for payment of any interest on any bills outstanding for payment. It is thus submitted, that on the bills outstanding per se, no interest can be levied. It is submitted that it is not the case of the respondent contractor that bills were outstanding. It is submitted that the bills which have been withheld, in fact, they have not been paid. It is further submitted that if it is so found that withholding or action of non-payment for alleged claim is illegal and not warranted under the contract, the said sub-clause (g) of clause XVII shall not operate. 5.4 It is further submitted that clause XX provides for services to be performed by the contractor under the contract, Part- I thereof provides for stevedoring and bagging in the holds of the vessels. 5.4 It is further submitted that clause XX provides for services to be performed by the contractor under the contract, Part- I thereof provides for stevedoring and bagging in the holds of the vessels. It is submitted that as per clause (i) of Part- I, the contractor is expected to complete the discharge in the minimum period possible by taking necessary steps to avoid ship going under demurrage. It is next submitted that the said clause further obligates the contractor to arrange for discharge of a minimum quantity of 1500 metric tons per day in case of dry cargo vessel and 2500 metric tons per day in case of bulk carriers/tankers and according to the appellant corporation, this is the discharge rate irrespective of what is mentioned in the charter party agreement. 5.5 While further referring to sub-clause (iii), Part-I of clause XX, it is submitted that the said clause obliges the contractor to make necessary arrangement for the use of the ship or port gear and/or ship winches required for the discharge of food-grains and pay charges incurred for hiring the gear. Thus, it is clear that the things which were required to be arranged by the respondent contractor have been set out in the said clause; however, arrangement of barges etcetera was never forming part of the said clause. While further referring to Part-II of clause XX, it is submitted that various sub-clauses enumerated therein provide the duties on the part of the contractor to be performed for clearings and transport of foodgrains arriving in bulk by sea. It is vehemently submitted that whenever and whatever services were required to be undertaken by the contractor, the same were specifically stated in the contract. While further referring to sub-clause (ix) of Part- II, it is submitted that the said clause provides for the payment of port, customs and railway charges, such as wharfage, lighterage, cranage, launch hire for towing barges from ship to shore, wagon hire survey fees, overtime fees etcetera to be made to the Port and Railway authorities directly by the corporation. It is submitted that the said sub-clause (ix) categorically provides that it was the responsibility of the corporation to make the requisite payment and the said responsibilities cannot be thrust upon the respondent contractor. It is submitted that the said sub-clause (ix) categorically provides that it was the responsibility of the corporation to make the requisite payment and the said responsibilities cannot be thrust upon the respondent contractor. 5.6 While further referring to clause XXI, it is submitted that the same provides for the duties and responsibilities of the contractor and the same are for the purpose of ensuring the services to be performed by the respondent contractor. It is submitted that sub-clause (1) and (2) of clause XXI nowhere provides or makes liable to the respondent contractor for arranging the barges, tugs etcetera. It is further submitted that sub-clauses (5), (6) and (7) provide for the responsibility of the contractor for taking all steps necessary to ensure prompt discharge from the steamers and removal of cargo from the shed without incurring any damage. It also provides that the contractor shall be responsible for making necessary arrangement for the storage of foodgrains, gunnies, twins etcetera. It is thus submitted that the liability was to take steps for everything to be done at the earliest and if the contractor fails to do so then, there can be adjustment. It is further submitted that it also provides firm steps to be taken to avoid causing of loss of demurrage. In support of the aforesaid, reliance has been placed on communication dated 22.7.1988 (Exhibit 70) to submit that the said communication was addressed by the respondent contractor after the tender was floated, but prior to the award of the contract on 30.8.1988. 5.7 It is submitted that after the work order was issued, the respondent contractor immediately on 12.9.1988 addressed a communication (Exhibit 113), inter alia, requesting the Port Officer that the vessel m.v Endurance Sea is due to arrive at the port on around 15.9.1988 and since the appellant had desired to maintain discharge rate of 2500 metric tons per weather working day, it was requested to arrange for adequate barges, tugs and transit sheds enabling the respondent contractor to maintain said discharge. It is submitted that the respondent contractor had requested for making available the requisite facilities so as to enable it to achieve the prescribed dispatch rate. It is submitted that the respondent contractor had requested for making available the requisite facilities so as to enable it to achieve the prescribed dispatch rate. It is submitted that pursuant to the said communication dated 12.9.1988 (Exhibit 113), the Port Officer, Gujarat Maritime Board addressed a communication on the same date, that is, 12.9.1988 (Exhibit 112) to the respondent contractor, inter alia, informing that looking to the present position of the fleet, the fleet and other facilities as per demand of the respondent contractor, cannot be given to only one vessel by suppressing the demand and right of the other senior vessels already working at the port. It is thereafter, the respondent contractor addressed further letters dated 16.9.1988, 17.9.1988 and 19.9.1988 (Exhibits 72, 73 and 74 respectively) to the appellant corporation following up the matter for providing facilities as indicated therein so as to enable it to achieve the desired discharge rate. It is submitted that pursuant to the said letters dated 16.9.1988 (Exhibit 72), 17.9.1988 (Exhibit 73) and 19.9.1988 (Exhibit 74) came letter dated 20.9.1988 (Exhibit 75) by the Assistant Manager of the appellant corporation to the Port Officer, inter alia, requesting to provide to its stevedores, that is, the respondent contractor, the facilities as indicated therein so as to discharge 2500 metric tons of the foodgrains. 5.8 It is submitted that sincere efforts were made by the respondent contractor in furtherance of achieving the stipulated discharge rate. It is submitted that since the respondent contractor was facing difficulty and was apprehending that it may be saddled with the demurrage charges unnecessarily, the respondent contractor filed a writ petition before this court which, came to be disposed of vide order dated 11.10.1988 with a direction to the respondent contractor to make a representation to the Managing Director of the appellant corporation. It is submitted that accordingly, the respondent contractor submitted a representation dated 15.10.1988, inter alia, raising a grievance that the condition of discharge rate mentioned in clause XX would be impossible to fulfill and therefore, an amendment was requested. It is submitted that the attention was drawn that unlike major ports, the necessary infrastructure facilities did not exist at the Veraval Port for achieving the desired discharge rate. It is submitted that the attention was drawn that unlike major ports, the necessary infrastructure facilities did not exist at the Veraval Port for achieving the desired discharge rate. It is submitted that it was also prayed that the said clause XX of the tender document should not be read in isolation, but the contract should be read in its entirety. It is submitted that thereafter, the Managing Director of the appellant corporation passed an order dated 6.3.1990 rejecting the representation dated 15.10.1988 of the respondent contractor. 5.9 It is submitted that the respondent contractor had addressed a communication dated 14.7.1990 (Exhibit 114) to the District Manager of the appellant corporation, inter alia, pointing out that there is no justification on the part of the appellant corporation in raising the demand for an amount of Rs.4,72,731.54 being alleged shipping demurrage. In fact, it was also pointed out that the corporation has not incurred any demurrage at all. Inspite of the failure on the part of the appellant corporation to provide the necessary infrastructural facilities to unload the cargo, due to the sincere efforts on the part of the respondent contractor, the appellant corporation had earned the dispatch money in quite number of ships. While referring to Exhibit 95, a statement prepared by the appellant corporation, it is submitted that under the head “vessel incurred actual demurrage as per charter party term/actual loss as per HO”, the endorsement shown is Nil. In other words, there was no demurrage incurred by the appellant corporation, as is clear from the 6th column of the said statement. 5.10 While referring to the communication dated 21.2.1989 (Exhibit 115), it is submitted that the respondent contractor had provided time-sheet as per the latest instructions for the facilities handled by it at Veraval Port. The dispatch money earned against the five vessels was to the tune of Rs.12,28,049.06 and 50% share of the respondent contractor, as per the contract, would come to Rs.6,14,024.53. The said calculation was made on the basis of rate of discharge per hatch worked out as per the instructions of the headquarter on the basis of the London Court judgment considering the cargo in the heaviest hatch. The said calculation was made on the basis of rate of discharge per hatch worked out as per the instructions of the headquarter on the basis of the London Court judgment considering the cargo in the heaviest hatch. While further relying upon Exhibit 122, which is a calculation sheet prepared by the appellant corporation, it is submitted that an amount of Rs.13,47,101.30 was withheld towards various heads and Rs.3,60,858.28 was withheld from the security deposit. The total recovery effected was Rs.17,07,969.56 (Rs.13,47,101.30 + 3,60,858.28) and the total liability was to the tune of Rs.5,30,959.04 and the remaining amount of Rs.11,76,990.54 was transferred to Rozi Port. According to the appellant corporation dues to the tune of Rs.16.87 lakhs were admitted. The said amount was only the amount which was withheld and if the dispatch amount is added, the claim of the respondent contractor would be on the higher side. 5.11 Learned counsel for the respondent, while referring to Exhibit 111, that is, the deposition of the witness of the respondent contractor, submitted that in the deposition it has been categorically stated by the witness that the contract was in the nature of service contract. It is stated in his deposition that as per said contract, the respondent contractor shall discharge foodgrains from the vessel into barges at mid sea and the barges were brought at wharf with the help of tugs and thereafter, barges were discharged by shore cranes provided by the Port authorities. It is also stated that the shore cranes and other facilities were owned and operated by the Port authorities for which the appellant was paying necessary charges such as wharfage and lighterage charges to the Port authorities. It has been categorically stated by the witness that the respondent contractor had requested the Port authorities as well as the appellant corporation; that the appellant corporation had addressed a communication dated 20.9.1988 to Port authorities and in response, the Port authorities addressed a communication dated 21.9.1988 pointing out its inability to provide required number of barges and other facilities as demanded by the respondent contractor. 5.12 The learned counsel further submitted that the witness has categorically stated that, in all, the work was undertaken for five steamers and that the appellant corporation was not required to pay any demurrage charges for discharge on the lower side and that as per the terms and conditions of the charter party agreement between the steamer company and the appellant corporation, the discharge rate was 800/1000 metric tons. It is further stated that had there been proper facilities made available to the respondent contractor, it could have achieved the discharge rate as agreed. 5.13 So far as the issue of the charges with respect to double stitching is concerned, it has been submitted that the witness has in his deposition stated that it was at the instance of the officers of the appellant corporation and approval granted by them that the respondent contractor had undertaken the work of double stitching. Not only that the appellant corporation had also agreed payment of additional charges for the said work of double stitching. In support of such contention, reliance has been placed on the sanction order issued by the appellant corporation. The witness, in his cross-examination has stated that once the goods are loaded in the railways, thereafter, the contractor, that is, the respondent contractor is not responsible and that it is the responsibility of the officers of the appellant corporation, as the whole process is undertaken in the presence of its officers. 5.14 It is further submitted that in the said deposition it has been stated that though the work was completed in the year 1990, the respondent contractor has not received any amount towards the services rendered by it. In the said deposition it is stated that the total work with respect to the five steamers was to the extent of Rs.82.13 lakhs of the bills. That the said amount was submitted to the appellant corporation; however, the appellant corporation has admitted only Rs.74 lakhs and out of that, the appellant corporation has paid the amount of Rs.57 lakhs and out of the said amount, Rs.17 lakhs has been withheld. That the said amount was submitted to the appellant corporation; however, the appellant corporation has admitted only Rs.74 lakhs and out of that, the appellant corporation has paid the amount of Rs.57 lakhs and out of the said amount, Rs.17 lakhs has been withheld. It is further submitted that out of the said Rs.17 lakhs, Rs.5.30 lakhs has been determined, as the final liability and the remaining Rs.11.76 lakhs has been adjusted against the tender awarded for the Rozi port, and as a result whereof, the respondent contractor has mentioned the claim of Rs.35.10 lakhs in the suit. 5.15 Learned counsel further submitted that the crossexamination of the said witness (Exhibit 111) is very material inasmuch as, it has been stated that the respondent contractor has undertaken the work with respect to 5 steamers and out of the five, in four steamers, the discharge rate of Rs.1500 metric tons could not be achieved for the reason that necessary and requisite facilities were not made available by the Port Officer, however, whenever the service facilities were provided, namely, with respect to the steamer Silver Sea, the respondent contractor, could achieve the discharge rate of 1500 metric tons. It is denied that the representation made to the appellant corporation was restricted only to maintenance of the discharge rate of 2500 metric tons. It has also been stated that the appellant corporation has fastened the liability on the respondent contractor for the loss of lay time to an extent of Rs.4,72,73.54, however, the same is a notional demurrage and that the appellant corporation has not paid any actual demurrage amount to anyone. It has been categorically denied that there has been breach of any of the terms and conditions, committed by the respondent contractor. 5.16 While relying upon the various documents, viz. Exhibits 136 to 144, that is, discharge report it is submitted that in all the reports, there is a categorical remark that “no cargo empty barges, alongside the vessel”. Thus, it is clear that it was owing to non-availability of the barges near the vessel, that the respondent contractor could not achieve the discharge rate as agreed in the contract. While referring to the document, Exhibit 159, it is submitted that the said document also contains endorsements to the effect that the barges were not supplied due to heavy rain and cyclone. While referring to the document, Exhibit 159, it is submitted that the said document also contains endorsements to the effect that the barges were not supplied due to heavy rain and cyclone. It is submitted that not only the barges were not available, but the same were not supplied. 5.17 While referring to the deposition of the witness of the appellant corporation, that is, Exhibit 158 and more particularly, the cross-examination, it is submitted that it has been categorically admitted that the appellant corporation has received the dispatch money with respect to five steamers and has not paid any actual demurrage. It is further submitted that the witness was the officer of the appellant corporation; however, in his deposition, he has stated that he was unaware about the facilities made available by the Port Officer. Though the register has been maintained, the witness chose not to produce the register and that the said details were not supplied or furnished to the learned advocate for the appellant corporation. Thus, it is submitted that all what has been admitted and submitted by this witness is that he is not aware about the facilities; however, the witness has not denied the aspect that the appellant corporation was not obliged to provide the facilities which being a material aspect, goes to the root of the matter. 5.18 The learned counsel while referring to the judgment under challenge submitted that so far as the issue numbers 1, 2, 8, 9 and 17 are concerned, the Trial Court has held that in view of the fact that the requisite facilities were not made available, it was impossible to discharge minimum quantity of 1500 metric tons per day. The Trial Court after considering all the issues, so also the provisions of Section 56 of the Contract Act has rightly come to the conclusion that the appellant corporation was not entitled to claim any amount towards loss of dispatch money or demurrage charges and resultantly not entitled to withhold and/or adjust any amount from the Veraval contract bills for Rozi Port contract bills. The Trial Court rightly declared that the appellant corporation has illegally withheld an amount of Rs.11,72,680/- from the bills of the respondent contractor. The Trial Court rightly declared that the appellant corporation has illegally withheld an amount of Rs.11,72,680/- from the bills of the respondent contractor. 5.19 It is further submitted that so far as the aspect of security deposit is concerned, the Trial Court applied the principle laid down by this court in the case of Variety Body Builders vs. Union of India reported in 1973 GLR 998 . In the said judgment, it has been held that the law does not assume legal injury or loss and damage occurred, the moment the contract is broken. Unless actual loss or damage is proved, the party has no right to forfeit the security deposit. The Trial Court has rightly observed and held that in view of the fact that there was no breach on the part of the respondent contractor and that no loss having been caused to the appellant corporation, there was no justification on the part of the appellant corporation to withhold or forfeit any amount of the security deposit. The Trial Court rightly directed the appellant corporation to return the entire amount of Rs.8,70,000/- towards security deposit to the respondent contractor. 5.20 While referring to the issue No.5, it is submitted by the learned counsel that the said claim has been decided against the respondent contractor and against which no appeal has been filed. 5.21 It is further submitted that so far as the issue of double stitching charges is concerned, the Trial Court has on the basis of material available on record concluded that there is no dispute that the tender was providing for single stitching of the bags, but it was the appellant corporation itself who had instructed the contractor to apply the double stitching. However, when the respondent contractor raised the demand, it was not settled at the rate fixed, but, lower rate was offered. The Trial Court while relying upon the documents, that is, Exhibits 119, 120 and 121 concluded that the appellant corporation itself had accepted the liability. Accordingly, the Trial Court held that when the charges for single stitching was 10 ps. per bag and the double stitching was directed at the instance of the appellant corporation, equal amount should be paid for the additional work. Accordingly, the Trial Court held that when the charges for single stitching was 10 ps. per bag and the double stitching was directed at the instance of the appellant corporation, equal amount should be paid for the additional work. 5.22 Learned counsel further submitted that so far as the issue of dispatch money is concerned, the Trial Court has, on the basis of material available on record, categorically came to the conclusion that the appellant corporation had earned the dispatch money for all the five vessels and that it was only in the written statement, for the first time that the appellant corporation had come out with the defense that, had the discharge of 1500 metric tons been maintained, the appellant corporation would have earned more dispatch money and that the loss should be recovered from the respondent contractor. The Trial Court has observed that the said ground is nothing, but an afterthought and was not supported by any evidence worth the name. The Trial Court in absence of any evidence adduced by the appellant corporation in this behalf placed reliance on Exhibit 82 wherein, it has been stated that the dispatch money will be shared equally between the appellant corporation and the respondent contractor and that no mention is made about quantity laid down in the charter party agreement for sharing the dispatch money. It is submitted that the Trial Court on the basis of statement at Exhibit 95 had come to the conclusion that the total dispatch money earned was Rs.10,79,821/- and considering 50%, the same comes to Rs.5,39,910/- and it directed the appellant corporation to pay the said amount to the respondent contractor towards the dispatch money. 5.23 Learned counsel while adverting to the contention raised on behalf of the appellant corporation, that once having filed the writ petition before this court and it having been withdrawn without reserving any liberty to file the suit, the suit of the respondent contractor is barred by the principles of res judicata and/or constructive res judicata; it is submitted that this court while disposing of the writ petition has simply directed the respondent contractor to make a representation and that the merits of the petition was not gone into. It is further submitted that something has to be decided, however, in the present case, there was no adjudication on merits. It is further submitted that something has to be decided, however, in the present case, there was no adjudication on merits. Moreover, the claim in the writ petition vis-à-vis the claim in the suit filed by the respondent contractor were distinct inasmuch as, the petition was filed at the threshold whereas, the suit was filed when the appellant corporation had withheld amounts under various heads, which the respondent contractor was otherwise legally entitled for. 5.24 It is further submitted that so far as the issue of rate of interest is concerned, the learned Trial Court has rightly awarded 18% inasmuch as, the bank rate for commercial purpose was 21% and thus, Section 34 of the Code of Civil Procedure allows the discretion in favour of the court to determine the rate of interest. 5.25 The learned counsel for the respondent further submitted that three aspects are required to be taken note of; firstly, the circumstance in the present case made the performance/obligation on the part of the respondent contractor impossible; secondly, if at all the appellant corporation is entitled for damages the question which arises, is as to what kind of damages it is entitled for and that Section 73 will come into play and only actual damages can be awarded. Interestingly, the claim of the other side is not for actual damages but is for notional/remote damages which is impermissible in law and lastly, even if such notional damages are claimed and if allowed, it would be an unjust enrichment, which is impermissible in law. 5.26 Further elaborating the aforesaid first aspect, it is contended that since the performance of the contract was an impossibility, the provision of Section 56 of the Contract Act straightaway comes into picture. Section 56 of the Contract Act provides that an agreement to do an act impossible in itself is void meaning thereby, that any act which is per se impossible is itself void. The second part of Section 56 further provides that a contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful. The said provision also provides for subsequent impossibility. The second part of Section 56 further provides that a contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful. The said provision also provides for subsequent impossibility. While further referring to the last portion of Section 56, it is submitted that the same provides for compensation for loss through nonperformance of act known to be impossible or unlawful. The said provision envisages that where one person has promised to do something which he knew, or, with reasonable diligence, might have known, and which the promisee did not know, to be impossible or unlawful, such promisor must make compensation to such promisee for any loss which such promisee sustains through the nonperformance of the promise. It is submitted that in the present case, contract per se is not void but subsequently, it became impossible for promisor to perform. It is further submitted that the respondent contractor was not in a position to know about the actual position inasmuch as, the same was in the realm of uncertainties. The knowledge has been imputed upon the respondent contractor at the time of execution of the contract, however, it was an absolute duty of the promisee, irrespective of the circumstances, to have provided the facilities as required under the contract. 5.27 In furtherance of the aforesaid submission, reliance has been placed on the judgment in the case of Industrial Finance Corporation of India Ltd. vs. The Cannanore Spinning & Weaving Mills Ltd. & others reported in (2002) 5 SCC 54 . The Apex Court in the said case while dealing with the provision of Section 56 of the Contract Act has held that the statute itself has recognized the doctrine of frustration and encompassed within its ambit an exhaustive arena of force majeure under which nonperformance stands excused by reason of an impediment beyond its control, which could neither be foreseen at the time of entering into the contract nor can the effect of the supervening event could be avoided or overcome. 5.28 Learned counsel placed further reliance on the judgment in the case of Sushila Devi and Anr. vs. Hari Singh and Ors. 5.28 Learned counsel placed further reliance on the judgment in the case of Sushila Devi and Anr. vs. Hari Singh and Ors. reported in (1971) 2 SCC 288 wherein, the Apex Court has relied upon its judgment in the case of Satyabrata Ghose vs. Mugneeram Bangur and Co. and Anr. reported in AIR 1954 SC 44 . Section 56 of the Indian Contract Act lays down a rule of positive law and does not leave the matter to be determined according to the intention of the parties and that the impossibility contemplated by Section 56 of the Contract Act is not confined to something which is not humanly possible. If the performance, of a contract becomes impracticable or useless having regard to the object and purpose the parties had in view, then it must be held that the performance of the contract has become, impossible. 5.29 Further reliance has been placed by the learned counsel on the judgment of the Apex Court in the case of Delhi Development Authority vs. Kenneth Builders and Developers Ltd. reported in (2016) 13 SCC 561 . While referring to paragraph 29, it is submitted that the Apex Court while dealing with the facts of the said case observed that the respondent contractor therein took all necessary steps to commence the construction activity on the project land but due to the impasse created by the governmental agencies, it could not proceed in the development activity. The Apex Court observed that under the said circumstances, the provisions of Section 56 of the Contract Act would be attracted. 5.30 Further reliance has been placed on the judgment in the case of Firm Bachhraj Amolakchand and Anr. vs. Firm Nandlal Sitaram and Ors. reported in AIR 1966 MP 145 . It is submitted that the Hon’ble M.P. High Court has postulated the principle in paragraph 23 has formulated three questions viz. “1. What was the foundation of the contracts having regard to all the circumstances of the case? 2. Whether the performance of the contract was prevented; and 3. reported in AIR 1966 MP 145 . It is submitted that the Hon’ble M.P. High Court has postulated the principle in paragraph 23 has formulated three questions viz. “1. What was the foundation of the contracts having regard to all the circumstances of the case? 2. Whether the performance of the contract was prevented; and 3. Whether the event which prevented the performances of the contract was of such a character that it could not reasonably be said to be in the contemplation of the parties at the date of the contract." It has been observed that if all these questions can be answered in the affirmative, both the parties are discharged from further performance of the contract. So far as the present case is concerned, foundation of barges, tugs etcetera was known to the parties; what was not known was non-availability of barges, tugs etcetera. Thus, it is submitted that the present case will fall within the purview of the provisions of Section 56 of the Indian Contract Act and once if it falls, the respondent contractor stands absolved from performance of the contract. Under the circumstances, it was impermissible to the appellant corporation to have withheld and recovered the amount from the respondent contractor. 5.31 Adverting to the another aspect viz. nature of damages, it is submitted that if at all the appellant corporation is entitled for damages, the question is what type of damages the appellant corporation is entitled for inasmuch as, Section 73 of the Indian Contract Act envisages only and only award of actual damages. Moreover, in the present case, the claim of the appellant corporation is not for actual damages, but is of notional/remote damage which is not permissible in law. The sole ground available to the appellant corporation for withholding and seeking to recover amount is the so-called damages suffered by it. It is submitted that, assuming that there is a breach of the terms and conditions of the contract on the part of the respondent contractor (though the respondent contractor does not admit it) what could be the extent of damages recovered from the respondent contractor. Perused the language of Section 73 of the Contract Act, it contemplates actual damages which the parties in fact have suffered and it does not contemplates notional/indirect damages. The illustrations appended to Section 73, viz. Perused the language of Section 73 of the Contract Act, it contemplates actual damages which the parties in fact have suffered and it does not contemplates notional/indirect damages. The illustrations appended to Section 73, viz. (o), (q) and (r), are direct answer to the controversy in the present case. 5.32 It is next submitted that loss in future is not to be considered and only actual loss suffered is to be taken into account. Further remoteness/unforeseen eventualities cannot be considered. What is to be seen is actual and not notional or remote loss and that whether Section 74 of the Indian Contract Act can be considered to be an exception to Section 73 of the Indian Contract Act. It is submitted that irrespective of proving the damages if there is a loss, party has to pay the damages, that is, scope and ambit of Section 74 of the Indian Contract Act. 5.33 In this behalf, reliance has been placed on the judgment in the case of State Of Kerala and Ors. vs. United Shippers and Dredgers Ltd. reported in AIR 1982 Ker 281 . It is submitted that the Hon’ble Kerala High Court while dealing with the provisions of Section 73 has in paragraph 7 held that the consequence of breach of contract contemplated in Chapter VI of the Act is the liability to pay compensation on the part of the person who has broken the contract and the right of the party, who has suffered by such breach, to obtain compensation., "Compensation" is "something that constitutes an equivalent or recompense; making things equivalent; satisfying or making amends." It is being further held that "compensation" signifies restoration of position or making things equivalent or recompense. Necessarily something must have had to happen as a result of the breach of the contract which requires an act of recompense or restoration. If the breach has not resulted in any harm, loss or damage to the other party, the question of recompensing him or restoring to him something which he has lost would not arise. Reliance has also been placed on the judgment of the Apex Court in the case of Fateh Chand vs. Balkishan Das reported in AIR 1963 SC 1405 . Reliance has also been placed on the judgment of the Apex Court in the case of Fateh Chand vs. Balkishan Das reported in AIR 1963 SC 1405 . 5.34 Further reliance has been placed on the judgment of the Apex Court in the case of Kanchan Udyog Ltd. vs. United Spirits Ltd., reported in (2017) 8 SCC 237 . Reliance has been placed on paragraphs 27, 28 and 29 to contend that the Apex Court in the said case, while discussing the scope of the provisions of Section 73, has held that the appellant therein had failed to take steps to mitigate losses and that no reasonable steps had been displayed as taken by the appellant for utilisation of its bottling plant by negotiations with others in the business. The Apex Court has further held that the reliance loss and the expectation loss can be maintained simultaneously or were mutually exclusive. The Apex Court in paragraph 28, has held that the primary object for protection of expectation interest, has been described as to put the innocent party in the position which he would have occupied had the contract been performed. It is further held that the general aim of the law being to protect the innocent party’s defeated financial expectation and compensate him for his loss of bargain, subject to the rules of causation and remoteness. The purpose of protection of reliance interest is to put the party in the position in which he would have been if the contract had never been made. The loss may include expenses incurred in preparation by the innocent party’s own performance, expenses incurred after the breach or even pre-contract expenditure but subject to remoteness. 5.35 While adverting to the last aspect of the submissions, it is submitted that assuming that the appellant corporation is required to be compensated on the basis of notional damages as claimed; if the same is allowed, it would be an unjust enrichment which is not permissible under the law. In support of this argument, reliance has been placed by the learned counsel on the judgment in the case of Indian Council for Enviro Legal Action vs. Union of India & Others reported in (2011) 8 SCC 161 . It is submitted that the Apex Court while dealing with the aspect of “unjust enrichment” has in detail analyzed the law. In support of this argument, reliance has been placed by the learned counsel on the judgment in the case of Indian Council for Enviro Legal Action vs. Union of India & Others reported in (2011) 8 SCC 161 . It is submitted that the Apex Court while dealing with the aspect of “unjust enrichment” has in detail analyzed the law. It is submitted that if the appellant corporation is allowed to withhold or retain the money in absence of any losses being actually suffered and proved, it would amount to unjust enrichment. 5.36 While adverting to the aspect of interest, it is submitted that Section 34 of the Code of Civil Procedure clearly provides for discretion to be exercised by the court while granting the interest. It is next submitted that bank rate should be applied and at the relevant point of time the bank rate was 18%. Reliance has been placed on the judgment of this court in the case of Manoj Rambhai Gadhvi and Ors. vs. Vaghasia Balubhai Khodabhai and Ors. reported in 2000(1) GLH 440 . It is submitted that this court has held that the interest awarded by the court though discretionary, must have some relationship to the interest rate generally prevalent in the economy; in the interest of uniformity, consistency and stability, in the awards/ decrees on which interest is awarded. It is submitted that in paragraph 8, this court has awarded interest slab wise as per the rate of interest prevalent in the respective years. While concluding it is submitted that the appeal deserves to be dismissed inasmuch as, the appellant corporation has not been able to made out any case. 6. Ms. Vashi, learned advocate for the appellant corporation submitted that under the provisions of Section 37 of the Contract Act, the respondent contractor was under an obligation to perform the discharge rate inasmuch as, no dispensation of such non-observance of dispatch rate is contemplated in the contract coupled with the fact that the order dated 6.3.1990 of the Managing Director of the appellant corporation has not been challenged by the respondent contractor. It is further submitted that looking to the clause XX of the contract, the reliance placed by the learned counsel for the respondent contractor on the provisions of Section 56 of the Contract Act is misplaced and deserves to be rejected. It is further submitted that looking to the clause XX of the contract, the reliance placed by the learned counsel for the respondent contractor on the provisions of Section 56 of the Contract Act is misplaced and deserves to be rejected. It is thus submitted that the appeals deserve to be allowed. 7. No other or further submissions have been made by the learned advocates for the respective parties. 8. Heard Mr. Jal Unwala, learned senior advocate assisted by Ms. Tejal Vashi, learned advocate for the appellant and Mr. Mehul S. Shah, learned senior advocate assisted by Mr. Premal Rachh, learned advocate for the respondent and have also perused and considered the material available on the record so also the paper-book. 9. The points for determination in the captioned appeals, are as under:- 1) Whether the respondent contractor has failed to perform its obligation under the contract as a result whereof, the appellant corporation is entitled for demurrage charges/loss of lay time/loss of earning? (2) Whether it was permissible to the appellant corporation to have withheld the amount from running bills as well as the security deposit and to have adjusted the same for another contract, that is, Rozi contract? (3) Whether the appellant corporation was justified in not making the requisite payment towards additional expenditure for double stitching incurred by the respondent contractor at the instance of the appellant corporation? (4) Whether the appellant corporation was justified in raising the respective claims for Veraval contract and Rozi contract in Special Civil Suit No.112 of 1991 and Special Civil Suit No.113 of 1991, respectively against the respondent contractor when the appellant corporation itself has not suffered any actual loss? (5) Whether the appellant corporation while laying its claim has proved that it has suffered viz. (i) loss to the tune of Rs.9,277.00 for 51 bags of US red wheat delivered in damaged condition and (ii) destination shortage to the tune of Rs.48,970/- for 280 bags? (6) Whether the appellant corporation was justified in laying its various claims against the respondent contractor without substantiating the same by leading evidence? (7) Whether the Trial Court rightly exercised the discretion in awarding the interest at the rate of 18% towards the amount which was illegally withheld by the appellant corporation? (8) Whether the suit filed by the respondent contractor was barred by the principles of res judicata? 10. (7) Whether the Trial Court rightly exercised the discretion in awarding the interest at the rate of 18% towards the amount which was illegally withheld by the appellant corporation? (8) Whether the suit filed by the respondent contractor was barred by the principles of res judicata? 10. Before proceeding further, since the contract forms the basis for the claims, it is important to point out some clauses of the said contract, relevant portions whereof, are as under:- “I) DEFINITIONS :- (v) “Services” - The term “Services” shall mean the performance of any of the items of work enumerated in the schedule of services and elaborated in clause XX hereof, including such auxiliary and incidental duties, services and operation as may be indicated by the Sr. Regional Manager, Ahmedabad.” (X) SUMMARY TERMINATION :- xxx (b) The Sr.Regional Manager, shall also have without prejudice to other rights and remedies the right., in the event of breach by the contractors of any of the terms and conditions of the contract, to terminate the contract forthwith and to get the work done, for the unexpired period of the contract at the risk and cost of the contractors and or forfeit the security deposit or any part thereof for the sum or sums due for any damage, loss, charges, expenses or cost that may be suffered or incurred by the Corpn. due to the contractor’s negligence or unworkmen like performance of any of the services under the contract. xxx. XI SECURITY DEPOSIT :- (a) The contractors shall furnish within a week of the acceptance of their tender, a security deposit as prescribed in the invitation to tender, failing which the contract shall be liable to cancellation at the risk and cost of the contractors and subject to such other remedies as may be open to the Sr.Regional Manager under the terms of the contract. The contractors at their option may deposit 50% of the prescribed security in any one of the prescribed forms at the time of award of the contract while the balance 50% may be paid by the contractors by deductions at the rate of 5% form admitted bill of the contractors. The contractors at their option may deposit 50% of the prescribed security in any one of the prescribed forms at the time of award of the contract while the balance 50% may be paid by the contractors by deductions at the rate of 5% form admitted bill of the contractors. xxx (e) The security deposit will be refunded to the contractors on due and satisfactory performance of the services and on completion of all obligation by the contractors under the terms of the contract and on admission of a “No Demand Certificate’s” subject to such deduction from the security deposit as may be necessary for making up Corporation’s claims against the contract. xxx (h) In the event of the security having insufficient for satisfaction of the sum recoverable or if the security has been wholly fortified, the balance of the total sum recoverable as the case may be, shall be deducted from any sum then due or which at any time thereafter may become due to the contractors under the or any other contract with the Corporation. Should that sum also be not sufficient to cover the full amount recoverable, the contractors, shall pay to the Corporation on demand the remaining balance due. XII. LIABILITY OF CONTRACTORS FOR LOSSES ETC. SUFFERED BY CORPN. :- xxx “SET OFF” (a) Any sum of money due and payable to the contractor including security deposit returnable to them under this contract may be appropriated by the Corporation and set off against any claim of the Corporation for the payment of any sum of money arising out of or under any other contract made by the contractors with the Corporation. The total sum claimed thereafter may become due to the contractors under this or any other contract with the Corporation. In the event of the sum which may be due from the Corporation as aforesaid being insufficient, the balance of the total sum claimed and recoverable from the contractors as aforesaid shall be deducted from the Security Deposit furnished by the contractors as specified in clause. Should this sum also be not sufficient to cover the full claim of the Corporation, the contractors shall pay to the Corporation on demand the balance of such claim. Should this sum also be not sufficient to cover the full claim of the Corporation, the contractors shall pay to the Corporation on demand the balance of such claim. (b) The Corporation shall be at liberty to reimburse themselves of any damages, losses, charges, costs or expenses suffered or incurred by them due to contractor’s negligence unworkmanlike performance of services under the contract or breach of any terms thereof. The total sum claimed shall be deducted from any sum then due or which at any time hereafter may become due to the contractors under this or any other contract with the Corporation. In the event of the sum which may be due from the Corporation as aforesaid being insufficient the balance of the total sum claimed and recoverable from the contractors as aforesaid shall be deducted from the security deposit furnished by the contractors as specified in para XI should this sum also be not sufficient to cover the full amount claimed by the Corporation, the contractors shall pay to Corporation on demand the remaining balance of the aforesaid sum claimed. xxx XX. SERVICES TO BE PERFORMED BY THE CONTRACTORS :- xxx PART – I – FOR STEVEDORING AND BAGGING IN THE HOLDS OF THE VESSEL (i) The contractors shall discharge the foodgrains in bulk/foodgrains bags (including sweepings and spillings) from the ship into lighters and/or wharf carefully and expeditiously and arrange to complete discharge in the minimum period possible and shall take all necessary steps to avoid ships going under demurrage and to earn maximum amount of despatch money. The contractor shall arrange to discharge a minimum quantity of 1500 MTs per day in case of dry cargo vessel and 2500 MTs per days in case of bulk carriers/Tankers on all days including holidays Saturdays/Sundays. Entire liability of ship demurrage calculated on the basis of above mentioned stipulated rate of discharge per weather working day irrespective of the charter party rates of discharge would be on contractor whereas despatch money will be shared equally between the Corporation and the contractor. Despatch money calculation for payment to contractor would be on the basis of minimum discharge rate stipulated above per weather working day irrespective of the discharge rate quoted in the charter party. For purpose of settlement of account of despatch/demurrage the monetary rates provided in the charter party of the relevant vessel will be applicable. Despatch money calculation for payment to contractor would be on the basis of minimum discharge rate stipulated above per weather working day irrespective of the discharge rate quoted in the charter party. For purpose of settlement of account of despatch/demurrage the monetary rates provided in the charter party of the relevant vessel will be applicable. In case Despatch/Demurrage rates are indicated in the Charter party of the relevant vessel in foreign currency into settlement with the contractor will be in Indian Rupees at the official rate of exchange prevalent on the date of completion of discharge of the said vessel.” xxx (iii) The contractor shall make necessary arrangements for the use of the ships or port gear and/or ships winches required for the discharge of foodgrains and pay any charges incurred for hiring the gear. The contractors shall use ships winches with their own labour to expedite discharge if such use of winches is not prohibited by the customs and the law of the port. PART – II – FOR CLEARANCE & TRANSPORT OF FOODGRAINS ARRIVING IN BULK BY SEA (i) The contractors on receiving information from the Port authorities or an intimation being given to them by the Sr.Regional Manager, Ahmedabad or an Officer acting on his behalf of the arrival or expected arrival of ship/vessel carrying Corporation foodgrains, at Veraval shall promptly arrange and obtain clearance documents from the port authorities, customs and steamer agents concerned and take delivery of the foodgrains. If the papers in respect of the ship/vessel which the contractors expected to clear have not been forwarded to or received by the contractors, they shall prepare indemnity bonds and other documents necessary for immediate clearance of the cargo. (ii) The contractors shall receive the notice of readiness in accordance with the charter party terms and customs of the Port and keep an account of the time of discharge and stoppages due to various process e.g. grain, break down of takkle etc. and or completion of discharge, sign the time sheet on behalf of the Corporation. The contractors shall take particular care that the time sheet signed by them has been prepared in accordance with the charter party terms customs of the Port. and or completion of discharge, sign the time sheet on behalf of the Corporation. The contractors shall take particular care that the time sheet signed by them has been prepared in accordance with the charter party terms customs of the Port. They shall liable to make good to the Corporation any loss caused, in opinion of the Sr.Regional Manager, Ahmedabad (whose decision shall be final and binding on the contractors) on account of the contractor’s lack of care in receiving notice of readiness and signing time sheets. (iii) The contractors shall watch and safeguard Corporation interests during the discharge of foodgrains by stevedores from the ships to quay (or into lighters and barges) filling of bulk grains in bags on the quay by the Port contractor and the handling of bags by Port Labour form quay to transit sheds. The contractor shall also be responsible for the safety of the standardized bags lying at the transit shed prior to loading into trucks/wagons. (iv)(a) The contractors shall receive the bags at the transit shed from the Port contractor and immediately after, arrange to standardize the bags i.e. bring them upto a prescribed weight, which will be indicated from time to time by the Sr.Regional Manager, Ahmedabad or an Officer acting on his behalf. The bags shall then be dispatched by trucks/rail to Corporation godown at Veraval for storage or direct to recipient as the case may be. The contractor shall also deliver the standardized bags to such person or persons as the Sr.Regional Manager, Ahmedabad or any Officer acting on his behalf may direct. The contractors shall if required load foodgrains bags with their labour under their supervisions into trucks/wagons. If it is possible to do standardisation at the transit sheds, this, work shall be done at godowns. Standardization which will involve carrying the bags to the scale, cutting open the mouth of the bags, putting it on the scale and putting in or taking out grains as may be necessary and restitching the bags with stitches, shall as far as possible, be carried out on the same day as the bags are received but in any case all be completed within 48 hours. (ix) The payment of Port, Customs and Railway charges such as wharfage, lighterage, cranage launch hire for towing barges from ship to shore, wagon hire survey fees, overtime fees etc. (ix) The payment of Port, Customs and Railway charges such as wharfage, lighterage, cranage launch hire for towing barges from ship to shore, wagon hire survey fees, overtime fees etc. shall ordinarily be made to the Port and Railway authorities direct by the Corporation but in exceptional circumstances, the contractors may be required by the Sr.Regional Manager, Ahmedabad or an Officer acting on his behalf to pay these charges except wharfage and lighterage and claim from Corporation by submitting Bills supported by receipts for payment made. No telegram and postage charges incurred in the performance of duties under this agreement shall be paid to the contractors.” 11. Adverting to the controversy involved, it is required to be noted that it is the case of the appellant corporation that the respondent contractor, as per the contract, was under an obligation to discharge a minimum of 1500 metric tons of cargo and had entered into the contract full aware of the implications thereof. Besides, it was the duty of the respondent contractor to have utilized the maximum capacity of barges and to provide adequate labourers to achieve 1500 metric tons per day discharge rate in case of dry cargo and 2500 metric tons per day in the case of bulk carriers; however, in the present case, the respondent contractor did not achieve the same and had failed to perform its contractual obligation. Resultantly, the respondent contractor has to reimburse the appellant corporation the expected profit as per the terms and conditions of the contract. It is further the case of the appellant corporation that owing to non-fulfillment of the terms and conditions of the contract, the respondent contractor became liable to pay to the appellant corporation, shipping demurrage calculated on the above stipulated rate of discharge, irrespective of the charter party agreement. So far as the Special Civil Suit no.112 of 1990 is concerned, the appellant corporation has filed its claim for demurrage charges, that is, non-earning of and loss of earning of dispatch money to the tune of Rs.4,72,731.54. 12. As against this, it is a case of the respondent contractor that it had all throughout raised a grievance about the non-feasibility of achieving requirement of 1500 metric tons per day; however, the said grievance of the respondent contractor had fallen on deaf ears. 12. As against this, it is a case of the respondent contractor that it had all throughout raised a grievance about the non-feasibility of achieving requirement of 1500 metric tons per day; however, the said grievance of the respondent contractor had fallen on deaf ears. It is also the case of the respondent contractor that as per sub-clause (ix) of Part-II of the terms and conditions of the contract, it was the obligation on the part of the appellant corporation to make payments of charges such as wharfage, lighterage, cranage launch hire for towing barges from ship to shore, wagon hire survey fees, overtime fees etcetera to the Port and Railway authorities, against which, the Port authorities were to provide these facilities to the respondent contractor. The payment of charges was in lieu of the facilities and that the respondent contractor was exempted from paying these charges as per the terms of the contract. Besides, the contract was in the nature of service contract which has been specifically defined in the contract. It is also the case of the respondent contractor that as per the record, viz. Exhibits 75 and 76 the appellant corporation so also the Port authorities – Gujarat Maritime Board failed to provide the facilities, required for the purpose of achieving the minimum discharge rate of 1500/2500 metric tons per day. 13. For determining this issue, a few aspects are required to be gone into. Pursuant to the tender notice dated 13.6.1988, the respondent contractor came to be awarded the tender on 16.6.1988 followed by the issuance of the work order on 31.8.1988. The said contract, executed between the parties was for discharging foodgrains from the vessel into barges in mid-sea and bring the barges at wharf with the help of tugs and thereafter, barges are discharged by shore cranes provided by the Port authorities. Such shore cranes are owned and operated by the Port authorities for which the appellant corporation was required to pay necessary charges. Such shore cranes are owned and operated by the Port authorities for which the appellant corporation was required to pay necessary charges. Further, wharfage charges are charges for use of a wharf (that is, a berth or a pier along side the bank) and ligterage charges are for lightering the cargo from the ship by unloading the same on the barges (that is, boat) so as to shift the cargo from port to ship and back, tugs for towing the barges, shore cranes to discharge the barges onto wharf and use of wharf area and also for providing shore crane operators, barge personnel and tug-master and other crew. 14. According to the condition enumerated in sub-clause (i) of Part-I of clause XX, the respondent contractor was obligated to achieve the minimum discharge rate on the arrival of the ship. As per sub-clause (ix) of Part-II of clause XX, the charges for the aforesaid facilities and infrastructures were to be paid by the appellant corporation to the Port authorities and the respondent contractor was exempted from the payment being made to the Port authorities in this behalf. 15. As per the record, the ship was to arrive on 15.9.1988 and the respondent contractor, three days prior to that date, addressed a communication dated 12.9.1988 (Exhibit 113) to the Port Officer - Gujarat Maritime Board, inter alia, requesting that as the appellant corporation had desired to maintain a discharge rate of 2500 metric tons per weather working day, Port Officer - Gujarat Maritime Board makes available adequate number of barges, tugs and transit shed so as to enable it to maintain the discharge rate of 2500 metric tons per day. The respondent contractor had specified the requirements, namely, (i) 22 numbers of port barges; (ii) 3 numbers of tugs for towing the barges; (iii) 7 numbers of shore cranes; (iv) transit shed at the port for 3500/4000 metric tons capacity. 16. The respondent contractor had specified the requirements, namely, (i) 22 numbers of port barges; (ii) 3 numbers of tugs for towing the barges; (iii) 7 numbers of shore cranes; (iv) transit shed at the port for 3500/4000 metric tons capacity. 16. In response to the said letter, the Port Officer - Gujarat Maritime Board, addressed a communication dated 12.9.1988 (Exhibit 112), relevant extract whereof reads thus :- “While it is agreed that in order to achieve an average discharge rate of 2500 metric tons per day you will need the facilities as mentioned in your above-referred letter, however looking to the present position of the fleet, it is informed that fleet and other facilities as per your demand cannot be given to only one vessel by suppression of the demand and right of the other senior vessels already working in port. However, I assure you that upon review of the traffic on this port, food grain vessel will definitely be allotted port facilities in preference to other vessel in port to extent it is possible.” 17. Thereafter, the respondent contractor addressed another communication dated 16.9.1988 (Exhibit 72) to the appellant corporation, wherein it was stated that though the vessel has commenced unloading; against the requirement of 22 barges, only 8 barges are made available and therefore, it would be difficult to maintain daily discharge rate of 2500 metric tons. It was also stated that it will not be responsible for non-maintenance of daily rate of discharge as stipulated in the contract. Immediately on the next day, the respondent contractor addressed another communication dated 17.9.1988 (Exhibit 73) reiterating its request and expressing that in view of the extent of the facilities provided, it would be difficult, rather impossible to maintain daily discharge rate of 2500 metric tons as stipulated in the contract. The contents of the letter read thus:- “In continuation of our letter dated the 16th instant we have to inform you that, on 15th Sept. 1988, the following Gangs remains idle on board the vessel because of No Barges alongside and winch out of order. One Gang at H.No. III for 2 hours. Two Gangs at H.Nos. V & VI for 4 Hrs. one Gang at H. No. III for 3 Hrs. Further on 16th the following Gangs remains idle on board for want of empty barges. Two Gangs at Hatch No. V & VI for 2 Hours. One Gang at H.No. III for 2 hours. Two Gangs at H.Nos. V & VI for 4 Hrs. one Gang at H. No. III for 3 Hrs. Further on 16th the following Gangs remains idle on board for want of empty barges. Two Gangs at Hatch No. V & VI for 2 Hours. Two Gangs at Hatch No. I & III for 1 Hour. Two Gangs at Hatch No. V & III for 3 Hours. One Gang at Hatch No. I for 2 Hours. One Gang at Hatch No. V for 3 Hours. One Gang at Hatch No. VI for 2 Hours. All Gangs (Four Gangs) were idle from 2300 Hrs. due no barges alongside. Also only one Launch was available for towing the loaded or empty barges which also hamper our discharging. Please not that despite our request to provide adequate empty barges only 8 barges were allotted to us for discharging, and hence we will not be responsible for any detention on board or on shore due to the above reasons/requirements which is beyond our control. Also we will not be responsible for any consequences about not maintaining daily discharg rate of 2500 M.Tons as stipulated in the contract.” 18. The aforesaid communication dated 17.9.1988 was followed by another communication dated 19.9.1988 (Exhibit 74) addressed to the appellant corporation following up the matter. The appellant corporation thereafter addressed a communication dated 20.9.1988 to the Port Officer, Veraval Port, relevant extracts whereof read thus:- “We like to bring to your kind attention that our Corporation has planned to import 0.90 lacs M tons of foodgrains at Veraval Port and we intend to discharge 2500 M tons per WWD. In order to meet said discharge rate, we earnestly request you provide to our stevedores, Velji P. & Sons (Agencies) following facilities:- (i) 22 number of port barges, (ii) 3 number of tugs for towing barges, (iii) 7number of shore cranes, (iv) Transit sheds/wharf are at the port for 3500/4000 metric tons capacity. We trust, you would extend your utmost cooperation for required discharge from the foodgrains ships anchored at your port” 19. In response to the said communication dated 20.9.1988 of the appellant corporation, the Port Officer - Gujarat Maritime Board vide communication dated 21.9.1988 (Exhibit 76), inter alia, informed that it would not be possible to give facilities exclusively to one vessel. In response to the said communication dated 20.9.1988 of the appellant corporation, the Port Officer - Gujarat Maritime Board vide communication dated 21.9.1988 (Exhibit 76), inter alia, informed that it would not be possible to give facilities exclusively to one vessel. It is stated thus:- “I acknowledge the receipt of your captioned letter stated therein the import of foodgrains to the extent of 0.90 lac MTons sponsored along with the arrival at other minor ports. The facilities of Tugs, Barges, Shore Cranes, Transit sheds, Open Plots etc., available at this port is equally and simultaneously provided, in general to 3 Import/Export vessels working at this port. Priority for smooth and efficient working is in accordance with the seniority of the vessel. The facilities as mentioned in your above letter do exist at this port but it cannot be given exclusively to one vessel. The following facilities are available at this port at present: (1) No. of Barges : 2700 MTons carrying capacity is available at present. 24 Barges of 100 MTons. 3 Barges of 100 MTons are under repair/Maintenance. (2) No. of Tugs : 3 Tugs are available at present. (3) Nos. of Shore Cranes: 6 Shore Cranes are available at present. One Electric Crane is under repair and One Mobile Crane of the port is to be received from Navalakhi Port. (4) Port capacity to handle total Nos. of vessel with port fleet : Two Import and One Export vessels. contd..2 xxx It is needless to mention here that full co-operation will be extended to Food Grain Vessel and Port facility will be allotted in reference to other working vessel, to the extent is possible. However prompt and rapid discharge of Foodgrain will become more operative and effective if the already discharged cargo is immediately removed from the limited transit space, allotted to your vessel. This will also avoid detention to other ship. Re-assuring our best co-operation.” 20. Bare perusal of the contents of the communications exchanged between the appellant corporation and the respondent contractor coupled with the terms of the contract, clearly suggest as to the intention of the parties and consequent understanding between them, in the matter of discharge of the respective obligations under the contract. Re-assuring our best co-operation.” 20. Bare perusal of the contents of the communications exchanged between the appellant corporation and the respondent contractor coupled with the terms of the contract, clearly suggest as to the intention of the parties and consequent understanding between them, in the matter of discharge of the respective obligations under the contract. As per the said understanding, one can safely conclude that it was for the appellant corporation to provide or arrange to provide the facilities as requested and required by the respondent contractor. Had it been otherwise, the appellant corporation would have raised objection and would have denied the providence of the said facilities; however, on the contrary, it took steps in furtherance of the request of the respondent contractor and requested the Port authorities - Gujarat Maritime Board to make available the said facilities. Further, the appellant corporation had examined its witness at Exhibit 158 and as per the said evidence, the witness has nowhere denied that it was not the duty of the appellant corporation to provide the facilities or that there were sufficient facilities available so as to enable the respondent contractor to achieve the discharge rate as agreed in the contract. The said witness has also not been able to dislodge the fact that for discharging of 1500 metric tons per day atleast 15/16 barges were the requirement. 21. From the aforesaid discussion, two things emerge, firstly, that there was a clear understanding between the parties that it was the obligation of the appellant corporation to provide the facilities viz. barges, tugs, shore cranes etcetera inasmuch as, it had to pay the relevant charges as per sub-clause (ix) of Part-II entitled “For Clearance and Transport of Foodgrains Arriving In Bulk By Sea” of clause XX and; secondly, the inability on the part of the Port Officer - Gujarat Maritime Board in providing the requisite facilities as requested by the respondent contractor so as to enable it to achieve the minimum discharge rate of 1500/2500 metric tons per day. 22. Cumulative reading of the above-referred provisions of the contract coupled with the contents of the aforesaid correspondence exchanged between the parties, clearly suggest as to what was intended by the parties to be their understanding in the matter of operating upon the whole contract. 22. Cumulative reading of the above-referred provisions of the contract coupled with the contents of the aforesaid correspondence exchanged between the parties, clearly suggest as to what was intended by the parties to be their understanding in the matter of operating upon the whole contract. Simply stated, as per the said understanding, it was the obligation on the part of the appellant corporation to provide or to arrange to provide the facilities in question to the respondent contractor to perform its part or the contract. Undeniably, the appellant corporation failed to provide or arrange to provide for the same. Evidence on record does not lead to any conclusion other than the above. 23. Thus, it is clear that it was owing to the want of requisite facilities being made available to the respondent contractor that it could not achieve the stipulated discharge rate as per the contract. It is under these circumstances that it was not feasible and rather, it was impossible to perform the contract by the respondent contractor. 24. At this stage, Section 56 of the Indian Contract Act deserves a mention. Section 56 of the Indian Contract Act provides that the agreement to do an act impossible in itself is void. Section 56 reads thus:- “56. Agreement to do impossible act.— An agreement to do an act impossible in itself is void. Contract to do an act afterwards becoming impossible or unlawful.—A contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful. Compensation for loss through non-performance of act known to be impossible or unlawful.—Where one person has promised to do something which he knew, or, with reasonable diligence, might have known, and which the promisee did not know, to be impossible or unlawful, such promisor must make compensation to such promisee for any loss which such promisee sustains through the nonperformance of the promise." 25. The learned counsel for the respondent contractor has placed reliance on various judgments in support of his arguments with respect to the provisions of Section 56; however, the judgment relied upon by the learned counsel in the case of Delhi Development Authority vs. Kenneth Builders and Developers Ltd. (supra) clinches the issue. The learned counsel for the respondent contractor has placed reliance on various judgments in support of his arguments with respect to the provisions of Section 56; however, the judgment relied upon by the learned counsel in the case of Delhi Development Authority vs. Kenneth Builders and Developers Ltd. (supra) clinches the issue. The facts before the Apex Court was that the respondent therein pursuant to the development agreement attempted to establish the infrastructure facilities on the project land when, the Department of Forests raised an objection to carrying out such activities on the ground that the project land falls in the ridge and all activities were required to be suspended. In furtherance of the implementation of the project, the respondent therein took all the steps, however, it was faced with impasse and was unable to obtain the ridge demarcation report and therefore the consent to establish (from the authorities therein), it approached the Delhi High Court with a prayer to set aside the tender/auction notice as also the allotment letter on the ground that the project was incapable of performance. The High Court had directed the authorities therein to refund the tender amount to the respondent since “consent to establish” and continue with the project had not been granted by the concerned authority. The Delhi Development Authorities challenged that order before the Apex Court and the Apex Court, while disposing the appeal observed in paragraph 32 that the respondent therein, that is, Kenneth Builders had taken all necessary steps to commence the construction activity on the project land, but due to impasse created by the Governmental agencies, it could not proceed in the development activity. Under the circumstances, the provisions of Section 56 of the Contract Act would be attracted. The Apex Court has observed and held in paragraphs 29, 30, 31 and 36, as under:- “29. Be that as it may, it appears to us that Kenneth Builders did take all necessary steps to commence the construction activity on the project land but due to the impasse created by the governmental agencies, it could not proceed in the development activity. We agree with learned counsel for Kenneth Builders that under these circumstances, the provisions of Section 56 of the Indian Contract Act, 1872 (the Contract Act) would be attracted to the facts of the case. Section 56 of the Contract Act reads as follows: “56. We agree with learned counsel for Kenneth Builders that under these circumstances, the provisions of Section 56 of the Indian Contract Act, 1872 (the Contract Act) would be attracted to the facts of the case. Section 56 of the Contract Act reads as follows: “56. Agreement to do impossible act - An agreement to do an act impossible in itself is void. Contract to do act afterwards becoming impossible or unlawful - A contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful. Compensation for loss through non-performance of act known to be impossible or unlawful - Where one person has promised to do something which he knew, or, with reasonable diligence, might have known, and which the promisee did not know, to be impossible or unlawful, such promisor must make compensation to such promisee for any loss which such promisee sustains through the non-performance of the promise.” 30. The interpretation of Section 56 of the Contract Act came up for consideration in Satyabrata Ghose v. Mugneeram Bangur & Co. It was held by this Court that the word “impossible” used in Section 56 of the Contract Act has not been used in the sense of physical or literal impossibility. It ought to be interpreted as impracticable and useless from the point of view of the object and purpose that the parties had in view when they entered into the contract. This impracticability or uselessness could arise due to some intervening or supervening circumstance which the parties had not contemplated. However, if the intervening circumstance was contemplated by the parties, then the contract would stand despite the occurrence of such circumstance. In such an event, “there can be no case of frustration because the basis of the contract being to demand performance despite the happening of a particular event, it cannot disappear when that event happens.” This is what this Court had to say: “9. The first paragraph of the section lays down the law in the same way as in England. It speaks of something which is impossible inherently or by its very nature, and no one can obviously be directed to perform such an act. The first paragraph of the section lays down the law in the same way as in England. It speaks of something which is impossible inherently or by its very nature, and no one can obviously be directed to perform such an act. The second paragraph enunciates the law relating to discharge of contract by reason of supervening impossibility or illegality of the act agreed to be done. The wording of this paragraph is quite general, and though the illustrations attached to it are not at all happy, they cannot derogate from the general words used in the enactment. This much is clear that the word “impossible” has not been used here in the sense of physical or literal impossibility. The performance of an act may not be literally impossible but it may be impracticable and useless from the point of view of the object and purpose which the parties had in view; and if an untoward event or change of circumstances totally upsets the very foundation upon which the parties rested their bargain, it can very well be said that the promissor finds it impossible to do the act which he promised to do. 10. Although various theories have been propounded by the Judges and jurists in England regarding the juridical basis of the doctrine of frustration, yet the essential idea upon which the doctrine is based is that of impossibility of performance of the contract; in fact impossibility and frustration are often used as interchangeable expressions. The changed circumstances, it is said, make the performance of the contract impossible and the parties are absolved from the further performance of it as they did not promise to perform an impossibility. The parties shall be excused, as Lord Loreburn says “If substantially the whole contract becomes impossible of performance or in other words impracticable by some cause for which neither was responsible.” 17. It must be pointed out here that if the parties do contemplate the possibility of an intervening circumstance which might affect the performance of the contract, but expressly stipulate that the contract would stand despite such circumstance, there can be no case of frustration because the basis of the contract being to demand performance despite the happening of a particular event, it cannot disappear when that event happens. As Lord Atkinson said in Matthey v. Curling “a person who expressly contracts absolutely to do a thing not naturally impossible is not excused for nonperformance because of being prevented by the act of God or the King's enemies … or vis major”. This being the legal position, a contention in the extreme form that the doctrine of frustration as recognised in English law does not come at all within the purview of Section 56 of the Indian Contract Act cannot be accepted.” 31. In so far as the present case is concerned, the DDA certainly did not contemplate a prohibition on construction activity on the project land which would fall within the Ridge or had morphological similarity to the Ridge. It is this circumstance that frustrated the performance of the contract in the sense of making it impracticable of performance. 36. On a conspectus of the facts and the law placed before us, we are satisfied that certain circumstances had intervened, making it impracticable for Kenneth Builders to commence the construction activity on the project land. Since arriving at some clarity on the issue had taken a couple of years and that clarity was eventually and unambiguously provided by the report of the CEC, it could certainly be said that the contract between the DDA and Kenneth Builders was impossible of performance within the meaning of that word in Section 56 of the Contract Act. Therefore, we reject the contention of the DDA that the contract between the DDA and Kenneth Builders was not frustrated.” 26. On the basis of the overall evidence available on record, more particularly Exhibits 72, 75, 76, 112 and 113, the Trial Court has rightly come to the conclusion that to maintain 2500 metric tons of quantity of discharge, 22 barges were required as sufficient number and that the said fact is admitted by the witness of the appellant corporation at Exhibit 158 and further he has not been able to dispute that for 1500 metric tons atleast 15/16 barges were required per day. The Trial Court has also observed that as against this, the witness of the respondent contractor on oath at Exhibit 111 had categorically stated that it had made available sufficient number of labourers so also other facilities on the ship and on the shore to ensure that the required quantity can be loaded and unloaded. The Trial Court has also observed that as against this, the witness of the respondent contractor on oath at Exhibit 111 had categorically stated that it had made available sufficient number of labourers so also other facilities on the ship and on the shore to ensure that the required quantity can be loaded and unloaded. The same has not been dislodged by the appellant corporation by leading any evidence to the contrary. Thus, it has been rightly concluded by the Trial Court that there was no failure or negligence on the part of the respondent contractor, rather it was failure on the part of the appellant corporation which created the situation where the terms of the contract regarding discharge of 1500 metric tons per day could not be achieved. The Trial Court had also correctly held that it was the appellant corporation itself who was unable to provide the necessary facilities to the respondent contractor and thus, it cannot take advantage of its own wrong. 27. It is contended on behalf of the appellant corporation in rejoinder that under the provisions of Section 37 of the Contract Act, the respondent contractor was obligated to perform the discharge rate inasmuch as, no dispensation of such non-observance was contemplated in the contract. Pertinently, the said contention neither was raised before the Trial Court nor is raised in the appeal memo or at the time of opening argument and it is raised for the first time in the rejoinder. Be that as it may. As per Section 37 of the Contract Act, parties are under an obligation to perform the contract subject to the exception of dispensation, as enumerated therein. It cannot be said that the contractor has not performed the obligation, except the fact of achieving the discharge rate on a lower side than the rate stipulated in the contract, owing to impossibility to perform. At this stage one aspect of the contract is required to be gone into. Clause X as reproduced hereinabove provides for summary termination in the event of breach by the contractor. Had it been the case of non-performance and consequent breach, it was very much open to the appellant corporation to have terminated the contract and could have got the remainder work done from another contractor at the risk and cost of the respondent contractor. Had it been the case of non-performance and consequent breach, it was very much open to the appellant corporation to have terminated the contract and could have got the remainder work done from another contractor at the risk and cost of the respondent contractor. The appellant corporation had not taken any steps in furtherance of clause X albeit it was available to it. The appellant corporation having not taken recourse of the said clause, it does not lie in the mouth of the appellant corporation that under Section 37 of the Indian Contract Act it was an obligation on the part of the respondent contractor to perform and that the dispensation of nonobservance of the discharge rate was not contemplated in the contract. The said contention thus, does not merit acceptance and is rejected. 28. It is also contended that the respondent contractor failed to utilize the maximum capacity of the barges and the resultant failure on its part in achieving the discharge rate; that the respondent contractor underutilized the capacity inasmuch as, the respondent contractor had not loaded the barges supplied to it to the optimum carrying capacity. The said contention of the appellant corporation is devoid of any merit and does not deserve acceptance. As aforesaid, a bare perusal of the contents of the letter dated 17.9.1988 (Exhibit 73) of the respondent contractor addressed to the appellant corporation, clearly indicates that the gang deployed by the respondent contractor had remained idle on board for want of empty barges. Besides, in one of the letters dated 17.9.1988, it has been stated that barges provided were only 8 in numbers for discharging the foodgrains. The witness of the appellant corporation in his cross examination has not been able to dislodge the factum that for 1500 metric tons, the number of barges required would be around 15 to 16 barges. Thus, even going by the evidence of the appellant corporation at Exhibit 158, it is clear that for discharge of 1500 metric tons, the required number of barges were to the extent of 15-16 barges. As against the said requirement, the barges provided by the Port authorities to the respondent contractor were less than what was required. 29. It is also contended by the appellant corporation that out of five vessels, in one vessel, the respondent contractor had achieved the minimum discharge rate of 1500 metric tons. As against the said requirement, the barges provided by the Port authorities to the respondent contractor were less than what was required. 29. It is also contended by the appellant corporation that out of five vessels, in one vessel, the respondent contractor had achieved the minimum discharge rate of 1500 metric tons. The theory propounded by the respondent contractor that looking to the facilities available at the port, it was impossible for the respondent contractor to achieve the discharge rate, is fallacious. This contention is self defeating inasmuch as, as discussed in the foregoing paragraphs, the documentary evidence, viz. Exhibit 75 and Exhibit 76, clearly suggest that the facilities as required were not provided, control whereof was purely within the domain of Port authorities. Hence, one cannot lose sight of the fact that even if the respondent contractor wanted to achieve the discharge rate of 1500 metric tons, it could not have done so in view of the port being under the direct and full control of the Port authorities. 30. While placing reliance on the documentary evidence, viz. Exhibits 136 to 157, that is, the time sheets, it is contended by the appellant Corporation that the time sheets contain discrepancies and difference in quantity discharge using the same barges. In this behalf it is pertinent to mention that so far as the reliance placed on the time sheets (Exhibits 136 to 157) is concerned, the same is misplaced inasmuch as, except contending that there are discrepancies and difference, the same has not been substantiated by any evidence about the effect of the said discrepancies and the difference in the time sheets. Quite apart, all the time sheets, duly signed by the Chief Officer of the vessels – Exhibits 136 to 157, in remarks column carry the endorsements viz. (i) no cargo empty barges alongside the vessel, (ii) no barge/idle, (iii) no barges alongside the vessel. Thus, the endorsements in the remarks column only speak that owing to non-availability of barges for the specified period, the work of unloading could not be done. Moreover, the time sheets, Exhs.136 to 157 do not carry any endorsement to the effect that the gang is unavailable or that the work has been held up owing to non-availability of the gang on the board of the vessel. 31. Moreover, the time sheets, Exhs.136 to 157 do not carry any endorsement to the effect that the gang is unavailable or that the work has been held up owing to non-availability of the gang on the board of the vessel. 31. It was under the said circumstances that the Trial Court had answered the issue in favour of the respondent contractor and against the appellant corporation that it was impossible to discharge the minimum quantity of 1500 metric tons per day due to non-availability of the facilities by the Port authorities and consequently, the condition in the contract was not enforceable. 32. In view of the aforementioned discussion, we are of the opinion that it was not possible for the respondent contractor to have discharged minimum quantity of 1500 metric tons per day due to non-availability of facilities, as discussed hereinabove. Thus, the condition in the contract was not capable of being enforced and it cannot be said that the respondent contractor had failed to perform its obligation rendering the appellant corporation entitled for demurrage charges/loss of lay time/loss of earnings. 33. Having held that there was an impossibility on the part of the respondent contractor in discharging the minimum quantity of 1500 metric tons per day due to non-availability of facilities by the appellant corporation through Port authorities and that there was a breach of the obligation on the part of the appellant corporation, the issue which now arises for this court is to consider as to whether the appellant corporation could have claimed an amount of Rs.4,72,731.54 towards the demurrage or loss of lay time or loss of non-earning of dispatch money/loss of earning. 34. It is the case of the appellant corporation that though minimum discharge quantity was specifically agreed by the respondent contractor, it could not maintain minimum discharge rate per vessel. Accordingly, show cause notice was issued and after considering the reply, loss of lay time/liability of shipping demurrage charges, that is, non-earning of and loss of earning of dispatch money to the tune of Rs.4,72,731.54 was fixed vide order dated 27.7.1990. Accordingly, show cause notice was issued and after considering the reply, loss of lay time/liability of shipping demurrage charges, that is, non-earning of and loss of earning of dispatch money to the tune of Rs.4,72,731.54 was fixed vide order dated 27.7.1990. It is also the case of the appellant corporation that since the respondent contractor has committed a breach by not maintaining stipulated dispatch rate, the appellant corporation as aforesaid has suffered loss and damage due to non-earning of dispatch money which it would have otherwise earned, if the respondent contractor had maintained the discharge rate as agreed. It is further the case of the appellant corporation that agreement with respondent contractor was irrespective of the charter party agreement between the appellant corporation and the shipping company and that the respondent contractor had no concern with the understanding arrived between the appellant corporation and the shipping company. It is the case of the appellant corporation that the clause in the contract is abundantly clear that discharge rate has to be maintained at 1500 metric tons for dry cargo and 2500 metric tons for bulk cargo irrespective of the charter party agreement. It is also the case of the appellant corporation that the discharge rate was slow due to non-workman like performance of the contractor as evident from the timesheet. It is also the case of the appellant corporation that loss of expected profit that would have earned, had the contractor maintained discharge rate of minimum 1500 metric tons and 2500 metric tons, as the dispatch money earned was directly related to the rate of discharge. The calculation of the dispatch money and the payment to be made to the respondent contractor was dependent on the minimum discharge rate stipulated in the contract and that the contractor is not entitled to earn any dispatch money as it failed to maintain the minimum discharge rate. 35. As against this, the stand of the respondent contractor as discernible from the record is that the appellant corporation had never had to pay any demurrage for the respective ship and that the rate of discharge of the cargo was in fact more than the rate stipulated in the relevant charter party agreement for the respective vessels. 35. As against this, the stand of the respondent contractor as discernible from the record is that the appellant corporation had never had to pay any demurrage for the respective ship and that the rate of discharge of the cargo was in fact more than the rate stipulated in the relevant charter party agreement for the respective vessels. It is the case of the respondent contractor that assuming that there was any shortfall in maintaining the discharge rate as stipulated in the contract for any vessel, it was owing to the fact that the appellant corporation failed and/or neglected to provide sufficient facilities for maintaining the rate of discharge. It is also the stand of the respondent contractor that the alleged failure on its part is solely due to the various omissions on the part of the appellant corporation and that it cannot be permitted to take advantage of its own wrong and therefore, it had no right in law to claim any amount either by way of loss of lay time or by way of demurrage or by way of damages or by way of loss on account of non-earning of dispatch money. It is also the case of the respondent contractor that the appellant corporation itself, had earlier claimed the sum of Rs.4,72,731.54 as “notional shipping demurrage” and according to the appellant corporation no demurrage charges were incurred or paid by it. In fact, the dispatch monies were earned by the appellant corporation for each of the five vessels. It is also the stand of the respondent contractor that demurrage does not mean non-earning of or loss of earning of dispatch money and it only means actual charges incurred due to late/delayed discharge of cargo. It is also the case of the respondent contractor that the appellant corporation had shifted its stand inasmuch as, earlier it had claimed a sum of Rs.4,72,731.54 as a notional shipping demurrage charges and subsequently, it claimed the very same amount towards the head of loss of lay time in four vessels on the ground that it could not earn the dispatch money. It is also the stand of the respondent contractor that assuming for the sake of argument that the appellant corporation had suffered a loss on account of non-earning of dispatch money and since the amount of dispatch money is required to be shared equally between the appellant corporation and the respondent contractor, and as per the contract, one half of the amount of Rs.4,72,731.54 comes to Rs.2,36,365.77. Thus, the claim of the appellant corporation for the entire amount, that is, Rs.4,72,731.54 is baseless and not tenable in law. 36. Considering the stand, the Trial Court, has held that in view of the fact that the appellant corporation itself was not able to provide the necessary infrastructure facilities to the respondent contractor and that the respondent contractor for want of the requisite facilities could not achieve the minimum discharge rate, it cannot take advantage of its own wrong of claim money for the so-called loss of earning of dispatch money. It has been held by the Trial Court that as per the terms and conditions of the contract, the dispatch money was to be shared equally between the appellant corporation and the respondent contractor and if at all any claim is to be advanced for the loss of dispatch money, it can be only one half of the total amount and not the full amount, that is, Rs.4,72,731.54. It is also been held by the Trial Court that it was impossible to discharge the minimum quantity of 1500 metric tons per day due to non-availability of facility by Port Authorities and consequently, the condition in the contract was not enforceable and therefore, the appellant corporation is not entitled to claim any amount towards loss of dispatch money or demurrage charges and therefore also, the appellant corporation is not entitled to withhold and/or adjust any amount for Veraval contract bill for Rozi Port contract bill. 37. Having held that there was a breach committed by the appellant corporation, which in turn made the respondent contractor’s obligation of achieving the minimum discharge rate, impossible to perform, the issue as regards claim for award of damages would not arise; however, for the sake of completeness, we may also venture to deal with the said claim, that is, claim of loss of lay time/demurrage charges/loss of earning of dispatch money, as interchangeably raised by the appellant corporation. 38. 38. At this stage, it would be profitable to refer to Section 73 of the Indian Contract Act, which reads thus:- “73. Compensation for loss or damage caused by breach of contract. When a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who has broken the contract, compensation for any loss or damage caused to him thereby, which naturally arose in the usual course of things from such breach, or which the parties knew, when they made the contract, to be likely to result from the breach of it. Such compensation is not to be given for any remote and indirect loss or damage sustained by reason of the breach. Compensation for failure to discharge obligation resembling those created by contract. When an obligation resembling those created by contract has been incurred and has not been discharged, any person injured by the failure to discharge it is entitled to receive the same compensation from the party in default, as if such person had contracted to discharge it and had broken his contract.” It envisages that when a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who had broken the contract, compensation for any loss or damage caused to him thereby; the second paragraph speaks that such compensation is not to be given for any remote and indirect loss or damage sustained by reason of the breach. Thus, the second paragraph clearly provides that compensation cannot be awarded for any remote and indirect loss or damage sustained by reason of breach. In the present case, undeniably the appellant corporation had not incurred any actual demurrage from the shipping company which, in fact is strengthened by the evidence produced on the record of the captioned appeals. 39. The appellant corporation, had issued a show cause notice dated 6.4.1990 to the respondent contractor (Exhibit 41), inter alia, requiring the respondent contractor to explain the circumstances as to why it failed to achieve the stipulated discharge rate as contained in the contract and as to why it should not be held responsible for “the notional shipping demurrage” amounting to Rs.4,72,731.54” and recover the same from the security deposit/admitted/pending bills. The relevant contents of the letter dated 6.4.1990 read thus:- “To, M/s. Veljipee & Sons (Agencies), 103/104 Kanchan Jungha, Opp. Cricket Bunglow, JAMNAGAR-361 001. The relevant contents of the letter dated 6.4.1990 read thus:- “To, M/s. Veljipee & Sons (Agencies), 103/104 Kanchan Jungha, Opp. Cricket Bunglow, JAMNAGAR-361 001. Sub: Stev. Clearance H & T Contract at Veraval from 8/88 to 8/8-Ship demurrage liability – regarding. …...... Dear Sirs, During your aforesaid contract period five vessels carrying Imp.wheat handled at Veraval port. You are aware that as per contract terms Part-I(i) at page No.22, you supposed to arrange discharge a minimum quantity of 1500 mt per day on all days including Holidays, Saturdaus & sundays, failing which entire liability of Ship demurrage calculated on the basis of above mentioned stipulated rate of discharge per WWD irrespective of C/party, rates would be on your account, whereas despatch money will be shared equally between the Corporation and the Contractor (you). It has been observed that you have not maintained the stipulated rate of 1500 mt per WWD inrespect of first four vessels arrived at Veraval, with the result vessels have incurred Notional Ship demurrag. As per final timesheets received from S.R.M. Ahmedabad on contract terms, the despatch/demurrage position is as under:- S. No. Vsl. & Date Ship dem. in Rs. Total 1. M/v.Endurance Sea 14-9-88 1,25,955-36 2. Mayoz 4-10-88 1,13,906-00 3. Ioman Empress 25-10-88 1,94,424-57 4. Sunset 8-12-88 51,619-48 4,85,905-41 5. Silver Sea 16-1-89 Desp. Money Earned 26,347-75 50% 13,173-87 4,72,731-54 According to the above figures total Rs.4,85,905-41 has been 44incurred notional ship demurrage against four vessels. After adjusting 50% share of despatch money Rs.13,173-87 total loss is worked out to Rs.4,72,731.54, which has suffered by the Corporation on account of failure on part of you. You are therefore requested to explain the circumstances under which you failed to achieve stipulated discharge rate as mentioned in contract terms and why you should not be hold responsible for above notional ship demurrage amounting to Rs.4,72,731-54 and recover the same from your Security deposit/admitted/pending bills. Your explanations should reach to the undersigned within 15 days from the receipt of this notice, failing which it will be presumed that you have accepted above liabilities and have nothing to say in the matter, which please be noted. Yours faithfully, sd/- DISTRICT MANAGER FCI: RAJKOT 40. Your explanations should reach to the undersigned within 15 days from the receipt of this notice, failing which it will be presumed that you have accepted above liabilities and have nothing to say in the matter, which please be noted. Yours faithfully, sd/- DISTRICT MANAGER FCI: RAJKOT 40. In response to the aforesaid show cause notice dated 6.4.1990, the respondent contractor submitted its reply dated 16.5.1990 clearly denying all the allegations, while stating that the appellant corporation had not suffered shipping demurrage amounting to Rs.4,72,731.54 inasmuch as, the discharge rates with the shipping company, that is, the charter party were 800 metric tons and 1000 metric tons per weather working day. It is also been stated that if the appellant corporation had not actually paid any demurrage to the shipping company, it would be legally impermissible for it to claim the said amount of Rs.4,72,731.54 towards the notional shipping demurrage. The relevant extracts of the letter dated 16.5.1990 read thus:- xxx “We acknowledge with thanks the receipt of your showcause notice under reference No.RJT/VRL/Velji P/8-88/8- 89/Liability 88 dated 6.4.1990 and your subsequent letter dated 11.5.1990. We beg to submit the following: 1. For the aforesaid hypothetical liability you have relied on the clause No.XX – Part I appearing on page No.22 of the tender document which reads as - “A discharge rate of 1500 M. Tons per day should be achieved on all days including Holidays/Saturdays/Sundays ….......”. We would like to appraise you, once again, at this stage, of the working pattern at the port of Veraval which is totally different from the major ports where discharge is carried out directly from the ship (alongside the berth) onto the wharf by means of heavy duty electrical cranes and other mechanical gears. Whereas at the Port of Veraval discharge is carried out in midstream (2/3 miles from shore in open sea) from the ship into the barges, thereafter these loaded barges are taken to shore by tugs where the cargo is discharged from the barges onto the wharf with the help of cranes. The minor port of Veraval is under direct control of the Gujarat Maritime Board and the local Port Officer is responsible for running the day to day affairs of the port i.e. distributing/allocating the port facilities such as barges, tugs, shorecranes, transit sheds/wharf, port landing and shipping contractor's labour gangs etc. etc. The minor port of Veraval is under direct control of the Gujarat Maritime Board and the local Port Officer is responsible for running the day to day affairs of the port i.e. distributing/allocating the port facilities such as barges, tugs, shorecranes, transit sheds/wharf, port landing and shipping contractor's labour gangs etc. etc. The above facilities are provided by the Port Authorities against payment of necessary charges viz., WHARFAGE AND LIGHTERAGE CHARGES. xxx Since you have failed to provide the necessary facilities/infrastructure and thereby not achieved the desired discharge rate how can be (contractors) can be blamed for the same. It is not true that the corporation has suffered a ship demurrage amounting to Rs.4,72,731.54 because of not maintaining the discharge rate of 1500 M.Tons per WWD. In fact your discharge rate with the shipping companies (Charter party) are 800 M.Tons and 1000 M.Tons per WWD for Rice in bags and Wheat in bulk respectively. We, therefore, request you to make available to us your time sheets which you have finalised with concerned shipping companies for the above four vessels for our verification of actual despatch earned. We would like to make it very clear that the contract was entered into, to avail of our services to the corporation for discharging of cargo on payment of charges as stipulated TN-he contract. It is not an arrangement whereby corporation is to earn any profit at our expenses. The rates in the relevant charter-party agreements govern the terms regarding payment of demurrage and also despatch money. If the corporation does not actually pay any demurrage to the shipping company, how on the earth the corporation can recover any amount from us on the alleged ground that we have not complied with the condition pertaining to the rate of discharge. It is now evident that the corporation wants to earn a profit from us by way of recovering hypothetical demurrage amount and at the same time reap the advantage of recovering the despatch money from the shipping companies without sharing the same with us. And this is inequitable, immoral and unconscionable demand is sought to be raised even when you failed to provide the prerequisite facility/infrastructure i.e. sufficient number of barges, tugs, shorecranes etc., etc. And this is inequitable, immoral and unconscionable demand is sought to be raised even when you failed to provide the prerequisite facility/infrastructure i.e. sufficient number of barges, tugs, shorecranes etc., etc. If it is the say of the corporation that the necessary facilities/infrastructure as stated hereinabove this letter is to be provided by the port authorities over xxx which you have no control, it would equally mean that the rate of discharge could not be achieved due to the circumstances beyond the control and factors akin to vis-major. Therefore your demand is patently illegal. We submit herewith a statement showing that at no given time the barges were detained alongside the vessels for want of labour gangs on board the vessel or otherwise, for all the four vessels handled by us at the port of Veraval. Thanking you, we remain,” 41. It is thereafter, that the appellant corporation passed the order dated 27.7.1990 (Exhibit 40) holding responsible the respondent contractor for payment of Rs.4,85,905.41 towards loss of lay time and called upon the respondent contractor to arrange the payment of Rs.4,72,731.54 (Rs.4,85,905.54 (-) Rs.13,173.87, that is, 50% share of the respondent contractor for dispatch money for one of the vessels). The relevant extracts read thus:- “Please refer to show cause letter No.RJT/VRL/Velji P/8- 88/8-89/Liability/88 dated 6-4-90 from Dist.Jamnagar, FCI, Rajkot pointing out your liability towards ship demurrage amounting to Rs.4,85,905.41. 2. As per contract clause XX(i), you are required to maintain minimum discharge rate of 1500 MT in case of dry cargo vessel on all days including Holidays/Saturdays & Sundays. Even though infrastructural facilities are available at Veraval Port you have failed to maintain minimum discharge rate of 1500 MT per WWD as stipulated in contract agreement. Further, your attention is also invited to Managing Director, H.Q: New Delhi's letter No.I&E..V/1(15)/88 dated 6-3-90 whereby the representation given by you has also been rejected by giving reasoned speaking award. 3. On account of your failure to maintain discharge rate as per provisions of the contract, FCI has lost lay time in four vessels out of five vessels handled by you to the extent of Rs.4,85,905.41 as per vesselwise details indicated in the show cause letter referred as above. However, in accordance with the terms and conditions of the contract, benefit of 50% share of despatch money earned ex.Vessel M/v Silver Sea of 16-1-89 i.e. Rs.13,173.87 is also allowed to you. 4. However, in accordance with the terms and conditions of the contract, benefit of 50% share of despatch money earned ex.Vessel M/v Silver Sea of 16-1-89 i.e. Rs.13,173.87 is also allowed to you. 4. I therefore under the terms and conditions of the contract hold you responsible for payment of Rs.4,85,905.41 (RUPEES FOUR LACS EIGHTY FIVE THOUSAND NINE HUNDRED FIVE AND PAISE FOURTY ONE ONLY) towards lay time cost under terms of tender and call upon you to arrange payment of Rs.4,72,731.54 (Rs.4,85,905.41 (-) Rs.13,174.87 after adjusting 50% share of despatch money earned in vessel M/v Silver Sea of 16-1-89) within 15 days on receipt of this communication, failing which the same will be adjusted/recovered from your pending bills/Security deposit if not already done for which necessary advice is also being given to our District Manager, Rajkot. 5. This is without prejudice to the rights available to the Corporation under the terms and conditions of the contract agreement which are fully reserved.” 42. At the cost of repetition, it may be recorded that it is well settled proposition of law that the intention of the party can be gathered either from the terms of the contract and/or letters exchanged between the parties. If one gathers the intention of the parties, from the communications exchanged amongst the parties in juxtaposition with clause (ix) of the contract read with the contents of the letter dated 20.9.1988 of the appellant corporation addressed to the Port Officer, Gujarat Maritime Board, it clearly reveals that the obligation of providing the required facilities was on the part of appellant corporation. Further, the witness of the appellant corporation Mr. Girijashanker Umashanker Bhatt in his deposition (Exhibit 158) could not refute that the appellant corporation had not made available the requisite facilities as desired by the respondent contractor to achieve the minimum discharge rate as stipulated in the contract. 43. Quite apart, in the show cause notice dated 6.4.1990, the stand of the appellant corporation was that it claimed the amount of Rs.4,72,731.54 towards the notional shipping demurrage. However, there was a shift in the stand of the appellant corporation and the very said amount of Rs.4,72,731.54 was claimed towards the loss of lay time in four vessels out of five vessels handled by the respondent contractor to the extent of Rs.4,85,905.41. However, there was a shift in the stand of the appellant corporation and the very said amount of Rs.4,72,731.54 was claimed towards the loss of lay time in four vessels out of five vessels handled by the respondent contractor to the extent of Rs.4,85,905.41. Further, as can be seen, the appellant corporation itself was not clear as to whether its claim of Rs.4,72,731.54 was against which head. Undeniably, the appellant corporation has not paid any amount towards the shipping demurrage against four vessels. The said factum is strengthened by the evidence of the witness of the appellant corporation, that is, of Mr. Girijashanker Umashanker Bhatt (Exhibit 158) wherein, he has categorically admitted that the appellant corporation has recovered the dispatch money from the vessel and has not paid any actual amount towards the shipping demurrage. Thus, in view of the aforesaid fact it cannot be said the Trial Court has committed any error in disallowing the claim of Rs.4,72,731.54 of the appellant corporation. 44. As can be seen from the contents of paragraph 2 of the order dated 27.7.1990 of the appellant corporation it records that “even though infrastructural facilities are available at Veraval Port you have failed to maintain minimum discharge rate of 1500 MT per WWD as stipulated in contract agreement”. The edifice on which the order dated 27.7.1990 is passed, itself is erroneous inasmuch as, as discussed herein above, it was the appellant corporation who had failed to provide the requisite infrastructure facilities for achieving the discharge rate. Thus, the foundation of the order dated 27.7.1990 to the effect that even though the infrastructure facilities were available at Veraval Port, the respondent contractor had failed to maintain the discharge rate of 1500 metric tons, is misconceived and without any basis. 45. So far as the amount of Rs.11,72,680.35 is concerned, the same was withheld from the running bills and adjusted against the Rozi contract. 45. So far as the amount of Rs.11,72,680.35 is concerned, the same was withheld from the running bills and adjusted against the Rozi contract. The view which we have taken with reference to the Veraval contract that the respondent contractor could not achieve the discharge rate owing to the omission on the part of the appellant corporation in providing the facilities and it cannot be said that any breach has been committed by the respondent contractor and the view which we are proposing to take and elaborated hereinafter, while dealing with the factual as well as legal aspects of the Rozi contract, as a necessary corollary it follows that the action of the appellant corporation in withholding the amount of Rs.11,72,680.35 from the running bill and adjusting the same against the Rozi contract is illegal. 46. So far as the claim of security deposit is concerned, it is pertinent to mention that an amount of Rs.8,70,000/- was lying with the appellant corporation towards the security deposit. Out of the said amount of Rs.8,70,000/- the appellant corporation had recovered Rs.3,60,858.28. Out of the said amount of Rs.3,60,858.28, an amount of Rs.1,71,170.99 was recovered against various liabilities whereas, an amount of Rs.1,89,987.29 was transferred to Rozi contract invoking the set off clause under the contract. The issue therefore arises is as to whether it was permissible to the appellant corporation to have invoked the provisions of clause XII (a) of the contract titled “Set Off”. The said clause provides that any sum of money due and payable to the contractor including security deposit returnable to them under the contract may be appropriated by the corporation and set off against any claim of the corporation if the payment of any sum of money arising out of or under any other contract made by the contractors with the corporation. 47. Undeniably, in the present case, the appellant corporation has not suffered any injury by way of demurrage and hence, in absence of any injury having been suffered, there arises no question of adjusting security deposit invoking the set off clause XII of the contract. 47. Undeniably, in the present case, the appellant corporation has not suffered any injury by way of demurrage and hence, in absence of any injury having been suffered, there arises no question of adjusting security deposit invoking the set off clause XII of the contract. The Trial Court while applying the principle laid down by this court in the case of Variety Body Builders vs. Union of India (supra) had come to the conclusion that there was no breach by the respondent contractor and that no loss has been caused to the appellant corporation and there was no justification in law for the appellant corporation to withhold or forfeit any amount of security deposit. 48. This court in the case of Variety Body Builders vs. Union of India (supra) has held that in ordinary course, if a security deposit is intended to be refunded and such amount is only for the purpose of securing the due performance of the contract and that forfeiture of such amount is permissible only when breach of the contract occurs and resultant legal injuries to the purchaser. This court observed that if the railway administration therein wanted to forfeit the amount or a part thereof, the burden was upon it to show that necessary requirements for the forfeiture exists. This court found that the railway administration therein had merely relied upon the contractual stipulations regarding forfeiture in case of breach of the contract and that there was no proof as to whether the breach has resulted in any legal injury or any loss or damage to it. This court then further held that the law does not presume legal injury or loss or damage occurs, the moment the contract is broken. The question whether a breach of contract has resulted in legal injury or actual loss or damage to the aggrieved party is essentially and wholly a question of fact. Therefore, so long as the facts necessary to prove this aspect of the matter are not pleaded, and so long as the parties do not get proper opportunity to prove their respective contentions on the issue, it would not be possible for the court to hold that legal injury exists or that any damage or loss has occurred to the aggrieved party. Relevant paragraphs 13 and 15 of the said judgment read thus: “13. Relevant paragraphs 13 and 15 of the said judgment read thus: “13. In ordinary course a security deposit is intended to be refunded and the amount in question is kept in deposit only for the purpose of securing the due performance of the contract. The said amount is forfeited only when a breach of the contract occurs and results in a legal injury. Therefore, if the railway administration wants to forfeit that amount or a part thereof, the burden is upon it to show that necessary requirements for the forfeiture exist. In this case the plaintiff has come forward with a plea that the defendant is not entitled to forfeit any party of the amount of security deposit. In reply to this plea of the plaintiff the defendants has merely relied upon the contractual stipulations regarding forfeiture in case of breach of the contract. The result is that there is no issue seeking to prove whether the breach has resulted in any legal injury or any loss or damage to the railway administration. Now the law does not presume that a legal injury of loss and damage occurs the moment the contract is broken. The question whether a breach of contract has resulted in legal injury or actual loss or damage to the aggrieved party is essentially and wholly a question of fact. Therefore. so long as the facts necessary to prove this aspect of the matter are not pleaded, and so long as the parties do not get proper opportunity to prove their respective contentions on this aspect of the matter, it would not be possible for the court to hold that legal injury exists or that any damage or loss has occurred to the aggrieved party. By reference to the written statement I find that there is absolutely nothing in any part thereof to show that the breach of the suit contract by the plaintiff has resulted in any legal injury. Obviously, therefore, there is no issue on this point and after referring to the evidence recorded in the case. I find that there is no evidence even of a causal type to prove that the plaintiff’s breach of contract has resulted in any legal injury to the defendant. Obviously, therefore, there is no issue on this point and after referring to the evidence recorded in the case. I find that there is no evidence even of a causal type to prove that the plaintiff’s breach of contract has resulted in any legal injury to the defendant. I specifically invited Shri Bhatt, the learned advocate of the defendants to draw my attention to any part of the record which would given even an indirect indication of the existence of legal injury. Shri Bhatt was not able to point out to any such evidence. But his contention was that the since it is found that it is plaintiff who has broken the contract and since the unfulfilled part of the contract was required to be executed by the railway, the court must presume that there is legal injury. I find myself unable to agree with this contention because existence of legal injury is not a fact which can be wished away or imagined. Not all the breaches of contracts result in loss, damage or injury and this would be more so, in case of commercial contracts where for varieties of the reasons, the breach may result in profit or in a situation where there is neither any profit nor any loss. Therefore, from the mere facts that the contract was broken by the other side, and that the remaining part of the contract was required to be performed either departmentally or by giving a new contract the court cannot hold that the legal injury, which is contemplated by Section 74 of the Contract Act has occurred. 15. Shri Bhatt then contended that since the parties do not seem to be aware during the course of the trial that they should produced evidence as regards the existence of legal injury, the matter should be remanded back to the trial Court after framing a suitable issue. I find myself unable to accept even this contention of Shri Bhatt, because, the written statement does not contain even a plea that the breach of the contract has resulted in any legal injury, damage or loss to the railway administration. The law on the subject has been laid down by the Supreme Court as early as the month of January, 1963 in Fateh Chand v. Balkishan Dass, reported in AIR 1963 SC 1405 . The law on the subject has been laid down by the Supreme Court as early as the month of January, 1963 in Fateh Chand v. Balkishan Dass, reported in AIR 1963 SC 1405 . While considering the argument that sec.74 of the Contract Act does not require the proof of actual loss of damage. Their Lordships of the Supreme Court have in this case succinctly pointed out that sec. 74 of the Contract Act merely dispensed with proof of "actual loss or damage", it does not justify the award of compensation when in consequence of the breach no legal injury at all has resulted, because, compensation for breach of contract can be awarded to make good loss or damage which naturally arose in the usual course of things or which the parties knew when they made the contract to be likely to result from the breach. So far as security deposit is concerned, the law is laid down by the Supreme Court in a recent decision in Maula Bux v. Union of India, AIR 1970 SC 1955 . Therein also after stating that in every case of breach of contract, the person aggrieved by the breach is not required to prove actual loss or damage suffered by him before he can claim decree and therefore, the Court is competent to award reasonable compensation in case of breach, even if no actual damage is proved to have been suffered in consequence of the breach of the contract, their Lordships have observed as under: "But the expression 'whether or not actual damage or loss is proved to have been caused thereby' is intended to cover different classes of contracts which come before the Courts. In cases of breach of some contracts, it may be possible for the court to assess compensation arising from breach while in other cases compensation can be calculated in accordance with established rules. Where the court is unable to assess the compensation, the sum named by the parties if it be regarded as a genuine pre-estimate may be taken into consideration but not if the sum named is in the nature of a penalty. Where loss in terms of money can be determined, the party claiming compensation must prove the loss suffered by him". Where loss in terms of money can be determined, the party claiming compensation must prove the loss suffered by him". These observations show that it was the duty of the railway administration to plead and prove the facts necessary to justify the forfeiture of the amount of security deposit or part thereof. The law on the subject was clear even before the suit was filed and, therefore, I see no justification for remanding the matter to the trial Court.” 49. The principle laid down by this court in the aforesaid case of Variety Body Builders vs. Union of India (supra) applies on all fours to the facts of the present case inasmuch as, the appellant corporation has merely relied upon the contractual stipulation regarding forfeiture in case of breach of the contract; however, the appellant corporation has failed to prove that there was any legal injury, much less any loss or damage to it. As per the principle laid down by this court, law does not presume that a legal injury of loss and damage occurs the moment the contract is broken. In the present case, as aforesaid this court has held that there was no breach committed by the respondent contractor. This court is of the opinion that there is absolutely nothing on record to show that appellant corporation has suffered any legal injury, permitting it to set off the amount of security deposit. 50. So far as the claim of Rs.6,97,121.00 towards double stitching is concerned, it is the case of the appellant corporation that the respondent contractor had failed to discharge the burden of proof and had not produced any evidence for double stitching. As against this, the case of the respondent contractor is to the effect that though the contract obliges the contractor to provide for single stitching; however, at the instance of the appellant corporation, it had undertaken the work of double stitching and had accordingly submitted the bills. The Trial Court after considering the evidence has held that there was no justification offered by the appellant corporation as to why the half paisa was proposed to be paid less. It held that the charge for single stitching was 10 paisa and when double stitching is provided at the instance of the appellant corporation, equal amount should be paid for additional work. It held that the charge for single stitching was 10 paisa and when double stitching is provided at the instance of the appellant corporation, equal amount should be paid for additional work. While holding so, the Trial Court had placed reliance on Exhibits 119, 120 and 121. The said exhibits are the telex message of the appellant corporation and it itself had sanctioned the charges for double stitching at Rs.9.50, that is, half paisa less than the charge of Rs.10 provided in the contract for single stitching. Pertinently, in order to avoid transit loss and to withstand additional handling of 95 kgs. bags, it was necessary for the appellant corporation to have the double stitching and accordingly, the appellant corporation itself directed the contractor to have double stitching to minimize the transit loss. It is also not disputed by the appellant corporation that the respondent contractor has not carried out the said work as instructed. Having carried out the work of double stitching by the respondent contractor at the instance of the appellant corporation and the appellant corporation having agreed to make the payment vide Exhibits 119, 120 and 121, it cannot be said that the Trial Court committed any error in awarding the amount of Rs.6,97,121/- towards the charges for double stitching and more particularly, when the appellant corporation has failed to prove to the contrary. 51. So far as the claim of amount of Rs.6,14,024.53 as 50% of the dispatch money for five vessels is concerned, the Trial Court has held that as per Exhibit 95, an amount of Rs.10,79,821.70 is earned by the appellant corporation as dispatch money as per the charter party agreement for the respective five vessels and the respondent contractor can only get 50% which comes to Rs.5,39,910/-. The stand of the respondent contractor was to give harmonious construction to clause XX, and whatever amount was earned as dispatch money by the appellant corporation, should have been shared equally between the parties. As against this, it was contended by the appellant corporation that the contractor would get dispatch money only for the quantity above 1500 metric tons. 52. Pertinently, the issue before the Trial Court was as to whether the respondent contractor was entitled to claim Rs.6,14,024.53 towards dispatch money earned by the appellant corporation. As against this, it was contended by the appellant corporation that the contractor would get dispatch money only for the quantity above 1500 metric tons. 52. Pertinently, the issue before the Trial Court was as to whether the respondent contractor was entitled to claim Rs.6,14,024.53 towards dispatch money earned by the appellant corporation. For determining the said issue the limited inquiry which was available to the Trial Court was to have relied upon clause (i) of Part–I of clause XX which reads thus:- “XX. SERVICES TO BE PERFORMED BY THE CONTRACTORS: xxx PART.I: FOR STEVEDORING AND BAGGING IN THE HOLDS OF THE VESSEL. (i) The contractors shall discharge the foodgrains in bulk/foodgrains bags (including sweepings and spillings) from the ship into lighters and/or wharf carefully and expeditiously and arrange to complete discharge in the minimum period possible and shall take all necessary steps to avoid ships going under demurrage and to earn maximum amount of despatch money. The contractor shall arrange to discharge a minimum quantity of 1500 MTs per day in case of dry cargo vessel and 2500 MTs per days in case of bulk carriers/Tankers on all days including holidays Saturdays/Sundays. Entire liability of ship demurrage calculated on the basis of above mentioned stipulated rate of discharge per weather working day irrespective of the charter party rates of discharge would be on contractor whereas despatch money will be shared equally between the Corporation and the contractor. Despatch money calculation for payment to contractor would be on the basis of minimum discharge rate stipulated above per weather working day irrespective of the discharge rate quoted in the charter party. For purpose of settlement of account of despatch/demurrage the monetary rates provided in the charter party of the relevant vessel will be applicable. In case Despatch/Demurrage rates are indicated in the Charter party of the relevant vessel in foreign currency into settlement with the contractor will be in Indian Rupees at the official rate of exchange prevalent on the date of completion of discharge of the said vessel.” On plain reading of the aforesaid clause, it clearly brings out that the dispatch money was to be shared equally between the corporation and the contractor. It further clearly provides that dispatch money calculation would be on the basis of minimum discharge rate stipulated, that is, 1500 metric tons per day in case of dry cargo vessel and 2500 metric tons per day in the case of bulk carrier/tankers irrespective of the discharge rate quoted in the charter party agreement. Thus, the dispatch money to be received by the contractor was dependent upon the discharge rate stipulated in the contract, that is, 1500 metric tons per day in case of dry cargo vessel and 2500 metric tons per day in case of bulk carrier/tankers and not the discharge rate stipulated in the charter party agreement executed between the appellant corporation and the ship owner. In the present case, it is clear that the respondent contractor did not achieve the minimum discharge rate as the facilities were not made available; however, that non-performance of the obligation by the respondent contractor will not render respondent contractor entitled for dispatch money considering the fact that sharing of dispatch money was a pre-condition and very much dependent upon achieving the discharge rate. Since 1500 metric tons could not be maintained, the respondent contractor in view of the conditions of the contract would not be entitled for dispatch money. Thus, reading the clause (i) Part-I of clause XX, the claim of the 50% dispatch money was wrongly allowed in favour of the respondent contractor and to that extent, the appeal of the appellant corporation deserves to be allowed and is accordingly allowed. 53. Adverting to the issue as regards res judicata, it is required to be noted that it is true that the respondent contractor had preferred a writ petition before this court which came to be disposed of by this court directing the respondent contractor to make representation; with further direction to the Managing Director of the appellant corporation to decide the same. It is clear that this court has not adjudicated upon the merits of the matter and that the petitions were disposed of at the admission stage with a limited direction. Moreover, the relief prayed for in the suit filed by the respondent contractor covered a larger spectrum. Thus, it cannot be said that the suit filed by the respondent contractor, claiming for the reliefs prayed for, was barred by the principles of res judicata much less constructive res judicata. Moreover, the relief prayed for in the suit filed by the respondent contractor covered a larger spectrum. Thus, it cannot be said that the suit filed by the respondent contractor, claiming for the reliefs prayed for, was barred by the principles of res judicata much less constructive res judicata. In this behalf the judgment of the Apex Court in the case of Pujari Bai vs. Madan Gopal reported in (1999) 3 SCC 433 is worth referring to. The Apex Court while dealing with the issue of res judicata held that when a writ petition after contest is disposed of on merits by a speaking order, the question decided in that petition would operate as res judicata, but not a dismissal in limine or dismissal on the ground of laches or availability of alternative remedy. The writ petition filed by the respondent contractor was not adjudicated upon, on merits, but was disposed of with a direction to the respective parties to make representation and the same to be decided by the appellant corporation. In view of the dismissal of the writ petition with such direction, it cannot be said that the suit filed by the respondent contractor was barred by the principle of res judicata. In view of the aforesaid, the Trial Court did not commit any error in deciding the issue of res judicata in favour of the respondent contractor and against the appellant corporation. 54. Adverting to the claim raised by the appellant corporation in the Special Civil Suit No.112 of 1990, it is required to be noted that the appellant corporation has raised a claim for an amount of Rs.9,277.20 towards the loss of 50 bags of US red wheat which was delivered in a damaged condition. Perceptibly, the Trial Court has decided the issue against the appellant corporation on the ground that it had not produced any evidence viz. amount of demurrage, condition, entries in the books of account, vouchers etcetera and neither had it produced any independent evidence to corroborate its claim. In the absence of any evidence produced by the appellant corporation, substantiating its claim, the Trial Court rightly rejected the claim of the appellant corporation. amount of demurrage, condition, entries in the books of account, vouchers etcetera and neither had it produced any independent evidence to corroborate its claim. In the absence of any evidence produced by the appellant corporation, substantiating its claim, the Trial Court rightly rejected the claim of the appellant corporation. Apparently, the appellant corporation has not been able to point out any error in the findings recorded by the Trial Court either during the course of the argument or by referring any grounds set out in the appeal memo, dislodging the said findings. Similarly, the claim of the appellant corporation for an amount of Rs.48,976.60 towards destination shortage of 280 wheat bags, except a show cause letter dated 18.1.1991, there is not a semblance of any evidence to substantiate the said claim. Under the circumstances, the Trial Court has given its findings and thus, this court is of the opinion that no fault can be found so far as the findings of the Trial Court with respect to the aforesaid two claims of the appellant corporation are concerned. 55. So far as the interest part is concerned, it has been contended by the appellant corporation that the respondent contractor is not entitled to interest as per sub-clause (g) of clause XVII of the contract and that it is not liable to pay any interest. It is further contended that assuming for the sake of argument and without admitting that the corporation is liable to pay interest as per the provisions of Section 34 of the Code of Civil Procedure, interest at the rate of 18% could not have been awarded. The respondent contractor on the other hand, while placing reliance on the judgment of this court in the case of Manoj Rambhai Gadhvi and Ors. vs. Vaghasia Balubhai Khodabhai and Ors. (supra) has submitted that awarding interest by the court is a discretion and that the discretion has been rightly exercised by the Trial Court and that the appellant corporation has not been able to justify as to how the rate of interest of 18% awarded by the Trial Court, is arbitrary. So far as the applicability of sub-clause (g) of clause XVII of the contract is concerned, the learned advocate for the respondent contractor is right in contending that if the bills are outstanding, per se, there cannot be any interest. So far as the applicability of sub-clause (g) of clause XVII of the contract is concerned, the learned advocate for the respondent contractor is right in contending that if the bills are outstanding, per se, there cannot be any interest. It is not the case of the respondent contractor of claiming interest on the outstanding bills, it is the amount which has been withheld illegally and not paid by the appellant corporation. The learned senior advocate for the respondent contractor is right in contending that if it is so found that the withholding or action of non-payment for alleged claim is illegal and not warranted under the contract, the said sub-clause shall not operate. This court is of the opinion that said sub-clause (g) of clause XVII will have no application inasmuch as, the respondent contractor is not claiming any interest on any outstanding bills for payment but, it has claimed the amount which, as held hereinbefore, were illegally withheld by the appellant corporation. Thus, the Trial Court has rightly exercised the discretion in awarding the interest at the rate of 18% which was the prevalent bank rate. The appellant corporation has not been able to justify by any pleadings or adducing any evidence, awarding of 18% interest except raising a ground in the appeal memo. Pertinently, it was incumbent upon the appellant corporation to have placed on record any evidence dislodging the factum that the interest awarded at the rate of 18% was against the prevalent bank rate and that the exercise of the discretion by the Trial Court was arbitrary. In fact, nothing has been pointed out by the appellant corporation except the contention as vague as it can be. In the circumstances, this court is of the opinion that the Trial Court has not committed any error in exercising the discretion as provided under Section 34 of the Code of Civil Procedure. 56. So far as First Appeal No.4106 of 1996 and First Appeal No.4107 of 1996 are concerned, the same pertain to Rozi Port and the relevant facts as discernible from the record are as under. 57. The appellant corporation invited tender for appointment as Stevedoring, Clearing, Handling and Transport Contractors for discharging foodgrains etcetera from steamers at Rozi Port for a period of one year. 57. The appellant corporation invited tender for appointment as Stevedoring, Clearing, Handling and Transport Contractors for discharging foodgrains etcetera from steamers at Rozi Port for a period of one year. Apropos the said tender notice, the respondent contractor submitted its tender offering to carry out various services laid down in the contract. The respondent contractor was awarded work order and it had completed the work in question from total five ships/vessels at Rozi Port and had also rendered the allied services to the appellant corporation for the period during 1.8.1988 to 31.7.1989. In furtherance of the execution of the services stipulated in the contract, various correspondence were exchanged amongst the respondent contractor, appellant corporation and Port Officer, Bedi Port for the purpose of providing facilities so as to enable the respondent contractor to achieve the minimum discharge rate as stipulated in the contract and indicating inability on the part of the appellant corporation so also the port authorities in providing the facilities as required by the respondent contractor to accelerate the discharge rate. The communications exchanged between the parties have been referred to in detail in the succeeding paragraphs and thus, for the sake of brevity they are not discussed here in detail. 58. The respondent contractor, apprehending action by the appellant corporation, preferred a writ petition before this court being Special Civil Application No.5977 of 1988, inter alia, praying for direction to the respondent contractor which came to be disposed of by this court directing the respondent contractor to make a representation to the Managing Director of the appellant corporation and further direction to the Managing Director of the appellant corporation to dispose of the said representation by speaking order. Pursuant to the order dated 8.9.1988 passed by this court, the respondent contractor submitted a representation dated 11.9.1988 to the Managing Director of the appellant corporation. The Managing Director of the appellant corporation passed an order dated 15.12.1988 (Exhibit 37) rejecting the representation dated 11.9.1988 of the respondent contractor. 59. As is discernible from the record, the respondent contractor had submitted its bills towards the services rendered by it. The Managing Director of the appellant corporation passed an order dated 15.12.1988 (Exhibit 37) rejecting the representation dated 11.9.1988 of the respondent contractor. 59. As is discernible from the record, the respondent contractor had submitted its bills towards the services rendered by it. On 21.4.1989, the appellant corporation issued a show cause notice (Exhibit 47) requiring the respondent contractor to explain the circumstances under which it failed to achieve the stipulated discharge rate and failing which why it should not be held responsible for entire ship demurrage amounting to Rs.27,09,897.44 suffered by the appellant corporation. It is thereafter that the appellant corporation issued another show cause notice dated 13.8.1990 (Exhibit 39), inter alia, calling upon the respondent contractor to file its explanation and why it should not be held liable for ship demurrage amounting to Rs.30,92,529.79. The amount of Rs.27,09,897.44 as indicated in the show cause notice dated 21.4.1989 (Exhibit 47) came to be modified to Rs.30,92,529.79. The appellant corporation thereafter passed an order dated 31.8.1990 (Exhibit 40) raising a demand against the respondent contractor on account of its failure to maintain discharge rate as per the provisions of the contract, as the appellant corporation has lost lay time in four vessels handled by the respondent contractor to the tune of Rs.30,92,529.79. 60. After completion of the work, the respondent contractor claimed an amount of Rs.25,26,001.65 which was not acceded to by the appellant corporation which led to the filing of Special Civil Suit No.166 of 1990 by the respondent contractor before the Civil Judge (Senior Division), at Jamnagar seeking decree for Rs.30,43,832/- together with interest. 61. Thereafter, the appellant corporation also filed a Special Civil Suit No.113 of 1991 seeking declaration that the appellant corporation is entitled to withhold the amount from the amount payable to the respondent contractor for the work of the Veraval contract. It also prayed for decree for an amount of Rs.30,92,529.79 under various heads, namely, road transport loss, destination shortage etcetera. 62. The Trial Court, as aforesaid, vide common judgment dated 4.5.1996 allowed the Special Civil Suit No.166 of 1990 holding that the respondent contractor – original plaintiff is entitled to recover an amount of Rs.30,43,832.00 under different heads together with interest at the rate of 18%. While the Special Civil Suit No.113 of 1991 filed by the appellant corporation for recovery of an amount of Rs.30,92,529.79 came to be dismissed. While the Special Civil Suit No.113 of 1991 filed by the appellant corporation for recovery of an amount of Rs.30,92,529.79 came to be dismissed. The Trial Court held that the appellant corporation is not entitled to deduct or withhold any amount from the running bills or the security deposit from the respondent contractor. 63. Being aggrieved, the appellant corporation has filed the above-referred First Appeal Nos.4106 of 1996 and 4107 of 1996 challenging the said common judgment dated 4.5.1996 with respect to Rozi contract. 64. The appellant corporation in the present group of First Appeals, has raised a ground that the respondent contractor was obliged to discharge the minimum rate of 1500 metric tons per day in case of dry cargo and 2500 metric tons in case of bulk carriers. However, it did not achieve the same and had failed to perform its contractual obligation. Resultantly, it is incumbent upon the respondent contractor to reimburse the shipping demurrage/loss of lay time/loss of earnings as per the terms and conditions of the contract. As against this, it is the case of the respondent contractor that as per sub-clause (ix) of Part-I of clause XX, it was the obligation on the part of the appellant corporation to make payments of charges for wharfage, lighterage, cranage launch hire for towing barges from ship to shore, wagon hire services, overtime fees etcetera to the Port and Railway authorities against which the Port authorities were to provide these facilities to the respondent contractor. Payment of charges was in lieu of the facilities and that the respondent contractor was exempted from paying these charges as per the terms of the contract. It is also the case of the respondent contractor that it is evident from the record viz. Exhibits 34, 88 and 90 that the appellant corporation so also the Port authorities failed to provide the requisite facilities so as to enable the respondent contractor to achieve the minimum discharge rate of 1500 metric tons per day. It is required to be noted that according to the conditions enumerated in sub-clause (i) of Part-I of clause XX, the respondent contractor was under an obligation to achieve the minimum discharge rate on the arrival of the ship. It is required to be noted that according to the conditions enumerated in sub-clause (i) of Part-I of clause XX, the respondent contractor was under an obligation to achieve the minimum discharge rate on the arrival of the ship. The Trial Court after considering the evidence has observed that as per the terms and conditions of the contract and more particularly, clause (ix), the appellant corporation was obliged to pay the charges for wharfage, lighterage, tugs etcetera and thus, it follows that the appellant corporation was to provide the facilities. 65. Before deciding this issue, it would be profitable to refer to some of the communications exchanged amongst the appellant corporation, respondent contractor and Port authorities – Gujarat Maritime Board. 66. In the present case, the respondent contractor addressed a communication dated 18.8.1988 to the appellant corporation, inter alia, informing that the existing facilities available at the port so as to achieve the stipulated discharge rate, is inadequate. Accordingly, the appellant corporation addressed a communication dated 22.8.1988 to the Port authorities, inter alia, requesting to provide maximum barges so as to enable it to accelerate discharge from the food grain ship anchored at the Rozi Port. The relevant extract of the said communication dated 22.8.1988 addressed by the appellant corporation to the Port Officer (Exhibit 34) reads thus:- “The Port Officer Bedi/Rozi Port Rozi Dist. Jamnagar Sub : Import of Wheat and Rice from abroad on behalf of Government of India arriving at Bedi/Rozi port. Sir, You might be aware that at Bedi/Rozi port impending imports is to the extent of 2.55 lakh MT have been sponsored alongwith the arrivals at the other minor ports. In this connection, Gujarat Maritime Board to whom we had approached earlier had furnished the existing facilities available at your port includes of other ports also. The statement indicating the requisite details furnished by Gujarat Maritime Board is enclosed for your ready reference. You are, therefore, requested to provide maximum barges so as to enable us to accelerate discharge from the foodgrain ships anchored at the Rozi port. Your co-operation in the matter and a line of confirmation with regard to the facilities available furnished in order to monitor and ensure quick turn around of the foodgrain vessels at Rozi port. Yours faithfully, Sd/- For Sr.Regional Manager” 67. Your co-operation in the matter and a line of confirmation with regard to the facilities available furnished in order to monitor and ensure quick turn around of the foodgrain vessels at Rozi port. Yours faithfully, Sd/- For Sr.Regional Manager” 67. Thereafter, the respondent contractor addressed a communication dated 23.8.1988 (Exhibit 89) to the Port Officer – Bedi Port, inter alia, requesting that in order to maintain the discharge rate of 2500 metric tons, it would require the facilities as indicated therein till the completion of the vessel viz. (i) 22 number of port barges, (ii) 3 number of tugs for towing barges, (iii) 7 number of shore cranes and (iv) 3 number of transit sheds at Rozi Port. On the next day, the appellant corporation had sent a telegram message dated 24.8.1988 (Exhibit 51) with a specific information to the Port Officer, Bedi Port, Jamnagar informing “the vessel sturia with 22500 MTs rice from Thailand is expected to arrive Rozi on or around 26.8.1988 for discharging full quantity. You are therefore requested to provide adequate number of barges/tugs/T.sheds etc. requested by our stevedores, for quick release of vessels and to avoid shipping demurrage”. 68. On 29.8.1988, the Port Officer, Bedi Port addressed a communication (Exhibit 90) informing the respondent contractor that looking to the position of the fleet and other facilities, the desired facility cannot be given to only one vessel by suppressing the demand and right of other senior vessels. The Port authority addressed a communication of even date (Exhibit 88) to the appellant corporation, inter alia, informing that the facilities of tugs, barges, cranes, transit sheds available at the port is to be equally and simultaneously provided on a priority basis for the smooth and effective working of the port. 69. Thus, on overall reading of series of correspondence exchanged between the appellant corporation, respondent contractor and the Port Officer – Bedi Port, it is clear that the respondent contractor had requested for providing requisite facilities so as to enable it to achieve the minimum discharge rate of 1500 metric tons/2500 metric tons per day. However, the Port Officer, in view of the fact that all facilities cannot be exclusively given to one vessel, expressed its inability in providing the services to the respondent contractor. 70. However, the Port Officer, in view of the fact that all facilities cannot be exclusively given to one vessel, expressed its inability in providing the services to the respondent contractor. 70. As discussed in the foregoing paragraphs, owing to the non-availability of facilities provided by the appellant corporation to the respondent contractor; so as to enable it to achieve the stipulated discharge rate of 1500 metric tons in case of dry cargo and 2500 metric tons in case of bulk cargo, it was not feasible for the respondent contractor to achieve the stipulated discharge rate rendering the performance of the contract impossible. It was indeed owing to the omission on the part of the appellant corporation that the respondent contractor could not achieve the stipulated discharge rate of 1500 metric tons/2500 metric tons per weather working day. Thus, it cannot be said that there was any breach committed by the respondent contractor of the terms of the contract. 71. Quite apart, as is evident from the record, the respondent contractor had submitted a representation dated 11.9.1988 (Exhibit 36) addressed to the Managing Director of the appellant corporation, inter alia, raising various grievances including the grievance that as against the requirement, the facilities allotted to the vessels is very less and thus it would be difficult to achieve the discharge rate as stipulated in the contract. In connection with the said representation dated 11.9.1988, a report was prepared by the appellant corporation wherein, the appellant corporation itself has conceded to the fact that stipulated discharge rate can be achieved only with adequate facilities if provided by port which is not done at present due to the increased traffic at port. The relevant extract of the report dated 21.9.1988 (Exhibit 84) reads thus:- “Since the Port Officer, Bedi Port, Jamnagar, vide his let. No.POT/840 dated 29.8.88, in reply to contractor’s let No.VPSA/FCI/STURIA/87-88 dated 23.8.88, have confirmed that port facilities are required to be provided equally to five working steamer at this port and accordingly our ship will be provided fleet equally from the available fleet with port. It means unless and until adequate port facilities are provided to contractor by port, to achieve discharge rate as per contractual agreement, contractor cannot give the discharge rate as per contract terms. It means unless and until adequate port facilities are provided to contractor by port, to achieve discharge rate as per contractual agreement, contractor cannot give the discharge rate as per contract terms. Our contractor have demanded 22 number of barges, 3 number of Tugs, 7 number of shore cranes and 3 Transit sheds, to cope with demanded discharge rate. The port authorities against the above, requirement of our contractor, provided, as on 9.9.88, 4 barges of 750 MT capacity and 2 shore cranes and 1 T.Shed. The above, facilities, provided are quite inadequate to achive discharge rate by contractor as contracted. The Port Officer, Bedi Port, Jamnagar, vide his letter No.POT/189 dated 29.8.88, in reply to Regional Office, Ahmedabad’s letter No.S&C/16(2)/88 dated 22.8.88, have explained, in detailed the facilities available with port and its distributions which may kindly be connected please. Page No. 10. (PARA-6) The argument advanced by the contractor is true, hence no comments. Page No. 11. Stipulated discharge rate can be achived only with adequate facilities if, provided by port, which is not done at present, due to increased Traffic at port and due to distribution of available port facilities, like Cranes, Barges, Tugs and Transit sheds etc. to many working ships. For example, even if Barges/Cranes/Tugs etc. are managed TRANSIT SHEDS AND PORT LANDING LAB facilities, remains in the control, of port only.” 72. Thus, it is clear that the appellant corporation was itself of the view that unless and until adequate port facilities are provided to the contractor by the port, the contractor cannot give the desired discharge rate as per the contract terms. Further, the demand of the contractor for having 22 numbers of barges etcetera and as against the facilities made available by the Port authorities against the said demand were on a lower side. The appellant corporation itself had observed that the “facilities provided are quite inadequate to achieve the discharge rate by the contractor as contracted”. 73. Further, the witness of the appellant corporation examined at Exhibit 117, has categorically admitted that for discharge of 1500 metric tons per day, atleast 10 barges would be required. It has also been stated that the barges are available of different capacities and if the barges are having the capacity of 100 tons, it can discharge 1500 metric tons per day by two trips each. It has also been stated that the barges are available of different capacities and if the barges are having the capacity of 100 tons, it can discharge 1500 metric tons per day by two trips each. The said witness, in his cross-examination has admitted that it is true that the Port authorities could not provide the requisite number of barges to the contractor. It has also been admitted that the Port authorities were requested to provide the requisite number of barges not once, but on various occasions. The said witness in his cross-examination has also admitted that the appellant corporation has not paid any amount towards actual demurrage for any of the vessels. Considering the communication dated 22.8.1988 (Exhibit 34), the report dated 21.9.1988 (Exhibit 84), the Trial Court has rightly come to the conclusion that it was impossible for the respondent contractor to have discharged minimum quantity of 1500 metric tons per day due to non-availability of facilities by Port authority and consequently, the condition in the contract was not enforceable. It accordingly, held that the appellant corporation was not entitled to claim any amount towards loss of dispatch money or demurrage charges and that therefore, the appellant corporation was not entitled to withhold or adjust any amount. 74. On the basis of the overall evidence available on record and more particularly, Exhibits 33, 34, 50, 51, 88, 89 and 90, the Trial Court has rightly come to the conclusion that all the charges were to be borne by the corporation and one of the essential conditions for fulfilling the contract was the availability of sufficient number of barges, tugs etcetera and without which the work could not have been possible to be completed. The Trial Court has also held that the appellant corporation has committed the breach of the contract itself by not being able to provide requisite number of facilities and thus, the said liability cannot be enforced against the respondent contractor. Thus, it cannot be said that the respondent contractor failed in its obligation in achieving the discharge rate. The Trial Court has also held that the appellant corporation has committed the breach of the contract itself by not being able to provide requisite number of facilities and thus, the said liability cannot be enforced against the respondent contractor. Thus, it cannot be said that the respondent contractor failed in its obligation in achieving the discharge rate. It was under the said circumstances that the Trial Court had answered the issue in favour of the respondent contractor and against the appellant corporation that it was impossible to discharge the minimum rate of 1500 metric tons per day due to non-availability of the facilities by the appellant corporation and consequently, the condition in contract was not enforceable. In view of the aforesaid discussion, we are of the opinion that the Trial Court on the basis of evidence available on record has not committed any error in coming to the conclusion that there was an omission on the part of the appellant corporation in providing the facilities. 75. As this court has also held and concurred that there was an impossibility on the part of the respondent contractor in discharging the minimum quantity of 1500 metric tons per day due to non-availability of the facilities by the appellant corporation through the Port authorities and that there was a breach of the obligation on its part, the issue which arises for the consideration of this court is as to whether the appellant corporation could have claimed an amount of Rs.30,92,529/- towards the shipping demurrage/loss of lay time/loss of non-earning of dispatch money. 76. It is the case of the appellant corporation that though the minimum discharge quantity was specifically agreed by the respondent contractor and that it could not maintain minimum discharge rate per vessel and accordingly, a show cause notice dated 21.4.1989 (Exhibit 47) was issued seeking demurrage calculated on the basis of stipulated rate of discharge. It has been stated that the appellant corporation has suffered shipping demurrage for a total amount to the tune of Rs.27,09,897.44 and requiring the respondent contractor to explain the circumstance as to why it failed to achieve the stipulated rate and that why it should not be held responsible for the entire shipping demurrage. It has been stated that the appellant corporation has suffered shipping demurrage for a total amount to the tune of Rs.27,09,897.44 and requiring the respondent contractor to explain the circumstance as to why it failed to achieve the stipulated rate and that why it should not be held responsible for the entire shipping demurrage. The said notice was replied to by the respondent contractor on 11.5.1988 (Exhibit 49) denying the allegations and pointing out; firstly, that the respondent contractor was exempted from payment of various charges, secondly, appellant corporation was obliged to provide facilities and thirdly, requisite facilities were not provided by the Port Officer and it was owing to the said reason that the respondent contractor could not perform its obligation rendering the said performance impossible. 77. It is thereafter, that the appellant corporation issued another notice dated 13.8.1990 (Exhibit 39) wherein the contents were similar except the amount towards shipping demurrage. Instead of Rs.27,09,897.44 the amount was revised to Rs.30,92,529.79. From the record it appears that thereafter vide order dated 31.8.1990, the appellant corporation has raised the final demand, inter alia, stating that on account of failure on the part of the respondent contractor to maintain discharge rate as per the provisions of the contract, it had lost a lay time in four vessels to the extent of Rs.30,92,529.79. 78. As already discussed hereinabove in great detail that there was an omission on the part of the appellant corporation in providing facilities and consequently, the respondent contractor could not perform its obligation rendering the performance of the terms of the contract impossible. In view of there being breach of the terms and conditions of the contract on the part of the appellant corporation, the claim raised by it towards shipping demurrage/loss of lay time has rightly been rejected by the Trial Court. Thus, we are in full agreement with the view taken by the Trial Court that the appellant corporation is not entitled for any amount towards the shipping demurrage/loss of lay time. 79. The Trial Court had come to the conclusion that there was no breach by the respondent contractor and that no loss has been caused to the appellant corporation and that therefore, there was no justification in law for the appellant corporation to withhold or forfeit any amount of security deposit. 79. The Trial Court had come to the conclusion that there was no breach by the respondent contractor and that no loss has been caused to the appellant corporation and that therefore, there was no justification in law for the appellant corporation to withhold or forfeit any amount of security deposit. While applying the principle laid down in the case of Variety Body Builders vs. Union of India (supra), the Trial Court has rightly come to the conclusion that in ordinary course of business, the security deposit is intended to be refunded and the amount in question is kept in deposit for the purpose of security for the due performance of the contract and that since there is no breach by the respondent contractor, consequently no loss is caused to the appellant corporation and that therefore, there was no justification available to the appellant corporation to withhold or forfeit any amount of security deposit. Thus, this court is of the opinion that the appellant corporation was not justified in adjusting the security deposit against any alleged liability of the respondent contractor. 80. So far as the claims, viz. destination shortage and double stitching are concerned, the Trial Court has allowed the claims of the respondent contractor. Adverting to the claim of the destination shortage, the Trial Court has come to the conclusion that the duty of respondent contractor ceased no sooner than it hands over the bags to the railway authorities. Moreover, the appellant corporation had not produced any evidence to the effect that it has suffered loss or that it had taken necessary steps to mitigate the loss. Resultantly, there was no justification on the part of the appellant corporation in deducting any amount from the bills of the respondent contractor towards destination shortage. Thus, on the basis of material available on record, the Trial Court has allowed the claim of Rs.34,815/- towards destination shortage. The appellant corporation has not able to dislodge the said findings by pointing out that the findings recorded by the Trial Court are perverse and based on no evidence or that the evidence which was available has not been considered by the Trial Court. The appeal memo is conspicuously silent in this behalf. 81. The appellant corporation has not able to dislodge the said findings by pointing out that the findings recorded by the Trial Court are perverse and based on no evidence or that the evidence which was available has not been considered by the Trial Court. The appeal memo is conspicuously silent in this behalf. 81. Adverting to the another claim of double stitching, unquestionably, the work of double stitching was carried out by the respondent contractor at the instance of the appellant corporation and that the appellant corporation has also allowed 0.95 paisa for double stitching. However, there was no justification put forth by the appellant corporation as to why it had not allowed 10 paisa. The Trial Court, has rightly observed that from the record, it transpires that 0.95 paisa was offered which was allowed and that there was no ground advanced by the appellant corporation as to why half paisa was proposed to be paid less when the charges for single stitching was 10 paisa per bag. Accordingly, the Trial Court had come to the conclusion that when the work of double stitching was carried out by the respondent contractor at the instance of the appellant corporation and in absence of any justification, equal amount, that is, 10 paisa should be paid for the additional work. The Trial Court has rightly allowed the claim of Rs.3,01,503.20 towards the additional work carried out by the respondent contractor for double stitching. This court is of the opinion that the Trial Court has not committed any error in allowing the said claim of Rs.3,01,503.20 towards double stitching. 82. Adverting to the various claims of the appellant corporation, viz. (i) road transit loss for Rs.39,362.72, (ii) destination shortage of 139 bags for an amount of Rs.54,206.40, (iii) destination shortage of six bags for Rs.1,671.22, (iv) claim towards sweeping for an amount of Rs.3,614.26, (v) claim for oil affected rice for Rs.,4,830.76, (vi) claim of red wheat contaminated with fertilizer for Rs.6,700/- and (vii) claim for gunny bags for Rs.8,583.00, it is required to be noted that, the Trial Court has specifically observed and concluded that the appellant corporation had not submitted any independent evidence to substantiate the said loss or damages. It was incumbent upon it to have produced some evidence towards the claims by way of entries in the books of accounts, vouchers etcetera; however, the appellant corporation has not produced sufficient evidence to fix the said liability on the respondent contractor and thus, the Trial Court disallowed the claims. The appellant corporation either during the course of the arguments or in the appeal memo has not been able to point out any error committed by the Trial Court and thus, this court, concurs with the findings recorded by the Trial Court so far as the claims raised by the appellant corporation are concerned. 83. The facts obtaining in the Veraval contract as well as the Rozi contract are identical. The issues of interest and res judicata have already been dealt with and discussed in detail in the preceding paragraphs and thus, the facts being identical, the said findings would govern both the aspects viz. interest and res judicata so far as the Rozi contract is concerned. 84. In view of the aforementioned discussion, the claim of the 50% of the dispatch money was wrongly allowed in favour of the respondent contractor and to that extent, First Appeal No.4105 of 1996 is partly allowed; whereas, First Appeal Nos.4106 of 1996, 4107 of 1996 and 4108 of 1996 are hereby dismissed. No order as to costs. 85. The Registry is directed to remit back the record & proceedings of the Special Civil Suit Nos.145 of 1990 and 112 of 1991 as well as the record & proceedings of Special Civil Suit No.166 of 1990 and 113 of 1991 to the concerned court.