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Ambewalle, a cottage industry mango pulp maker contracts with Pitale Bandhu, a medium scale Sweetmeats business to supply them with 10,000 cans of Alphonso mango

Ambewalle, a cottage industry mango pulp maker contracts with Pitale Bandhu, a medium

scale Sweetmeats business to supply them with 10,000 cans of Alphonso mango pulp for the

Diwali Season of 2019 for a sum of Rs 25,00,000. Pitale Bandhu gave the entire amount in

advance to Ambewalle in May 2019. The Alphonso pulp is a vital ingredient in a number of

signature sweets manufactured by Pitale Bandhu such as the Aamrakhand. In the run up to

the festive season around September 2019, Ambewalle informs Pitale Bandhu that due to a

combination of labour unrest and unseasonal rains, the cost of producing the pulp has shot

up by 25% and that even if Pitale Bandhu were to be happy to cover for this inflation in the

price, it would not be possible to meet the order for 10,000 cans. Accordingly, Ambewalle

suggests that Pitale Bandhu either take delivery of 7,500 cans for the same consideration

amount of Rs. 25,00,000, or look for an alternative supplier, which would have been difficult

at this late stage before the festive season. Sensing that they have no other real choice and

given their budgeting constraints, they agree to take 7,500 cans and nothing more for

Rs.25,00,000. Ambewalle delivers accordingly, and Pitale Bandhu is unable to cater

adequately to the festive demand.

After all is done, in January 2020, Pitale Bandhu sues Ambewalle for Rs. 6,25,000 (which is

equivalent to the originally agreed amount for the shortfall i.e. 2500 cans).

If in January 2020 Ambewalle makes Pitale Bandhu a promise to pay Rs. 3,00,000/- 'as

a gesture in light of Pitale Bandhu's action accommodating them [Ambewalla] in their

hour of need', would Pitale Bandhu be able to enforce this promise in a court of law,

in case Ambewalle backed out from it?

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