Article 299 compliance and sale price recovery govern liability; interest runs after contractual credit period under sale law.

A State buyer could not resist payment for goods received by relying on an alleged renewal arrangement that did not comply with Article 299 of the Constitution, so the seller was entitled to recover the sale price. Interest on the unpaid price was maintainable under Section 61(2) of the Sale of Goods Act, but only from expiry of the contractual 15-day credit period after delivery. The buyer's counterclaim failed because no valid contract binding the State was proved and the buyer was itself in default, though the advance deposit was directed to be credited in final adjustment.

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Issues: (i) whether the plaintiff was entitled to recover the sale price and whether the defendant could resist liability on the ground that the alleged renewal agreement was not validly executed under Article 299 of the Constitution; (ii) whether the defendant was liable to pay interest on the unpaid price under Section 61(2) of the Sale of Goods Act; (iii) whether the defendant was entitled to the counterclaim and the claim for credit of the advance deposit.

Issue (i): whether the plaintiff was entitled to recover the sale price and whether the defendant could resist liability on the ground that the alleged renewal agreement was not validly executed under Article 299 of the Constitution.

Analysis: The defendant's acknowledgment of receipt of the disputed consignment established liability for the price. The plea based on the renewal arrangement failed because no valid contract binding the State came into existence in the absence of compliance with Article 299 of the Constitution.

Conclusion: The issue was decided in favour of the plaintiff.

Issue (ii): whether the defendant was liable to pay interest on the unpaid price under Section 61(2) of the Sale of Goods Act.

Analysis: Section 61(2) empowers the Court to award interest on the price payable to the seller from the date the price became payable. The claim for interest was therefore maintainable, but it had to be restricted to the period after the expiry of 15 days from delivery, being the contractual credit period.

Conclusion: The defendant was held liable to pay interest, subject to calculation from the expiry of the 15-day period.

Issue (iii): whether the defendant was entitled to the counterclaim and the claim for credit of the advance deposit.

Analysis: The counterclaim depended on the existence of a valid contract and on an alleged breach by the plaintiff. Since no valid contract binding the State was established, and in any event the defendant was himself in default in payment, the counterclaim could not succeed. The advance deposit was, however, directed to be given credit in final adjustment.

Conclusion: The counterclaim was rejected, and credit for the advance deposit was allowed.

Final Conclusion: The plaintiff succeeded in recovering the price with restricted interest and appropriate credit adjustment, while the defendant's counterclaim failed.

Ratio Decidendi: A contract made on behalf of a State is unenforceable unless it satisfies Article 299, and in a sale of goods suit the seller may recover interest on the unpaid price under Section 61(2) from the date the price became payable.

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