Research › Search › Judgment

Punjab High Court · body

2003 DIGILAW 1625 (PNJ)

State of Haryana v. Yusuf alias Yusuf Khan

2003-12-03

V.M.JAIN

body2003
JUDGMENT V.M. Jain, J. - This judgment shall dispose of RSA Nos. 410 and 418 of 1984, as both the appeals have arisen against the judgment and decree dated 29.10.1983 passed by the District Judge, Gurgaon, whereby the appeal filed by the plaintiff was partly allowed and partly dismissed. 2. Yusuf alias Yusuf Khan had filed a suit of declaration to the effect that he was an approved contractor of PWD Public Health Department of Haryana and that a tender with an approximate cost of Rs. 40,000/- was invited on 11.11.1980 by the Executive Engineer, Public Health, Division No. 2, Gurgaon and that the plaintiff was one of the tenderers. It was alleged that the representatives of the plaintiff had filled by mistake the rate of 9% above the C.S.R. even though he wanted to fill 90% above the C.S.R. rate. It was alleged that the department approved the tender @ 9% above the C.S.R. and the approval was conveyed to the plaintiff in the middle of December, and when the plaintiff received the approval, he came to know about the mistake. It was alleged that after 4-5 days, he received a notice from the Executive Engineer for starting the work vide letter dated 16.12.1980 and on receiving the notice, he submitted representation to the department for correcting the rate as 90% above CSR instead of 9%. It was alleged that in his second representation, which was received by the department on 1.1.1981, the plaintiff had made it clear that if the rate is not corrected then the plaintiff was not willing to start the work. It was alleged that the department vide letter dated 6.1.1981, rejected the claim of the plaintiff and the department also imposed penalty on the plaintiff vide letter dated 8.2.1981, imposing a penalty of Rs. 4000/- as compensation, forfeiture of the earnest money of Rs. 800/- and removal of the name of the plaintiff from the approved list of contractors. It was alleged that these penalties were imposed upon the plaintiff in the absence of any legal contract entered into between the parties, inasmuch as the plaintiff had never signed the contract and the Executive English had imposed pecuniary loss on the plaintiff as the plaintiff had not been allowed to submit fresh tender for new works. It was alleged that these penalties were imposed upon the plaintiff in the absence of any legal contract entered into between the parties, inasmuch as the plaintiff had never signed the contract and the Executive English had imposed pecuniary loss on the plaintiff as the plaintiff had not been allowed to submit fresh tender for new works. It was alleged that the plaintiff had filed an appeal to the Superintending Engineer, PWD, Public Health, Gurgaon, but the Superintending Engineer affirmed the imposition of penalty by way of compensation of Rs. 4000/- vide letter dated 12.8.1981 without mentioning anything about the other penalties. It was alleged that the penalties imposed by the Executive Engineer and the Superintending Engineer were illegal and void and were liable to be set aside. 3. In the written statement filed on behalf of the defendant State of Haryana, various preliminary objections were raised. On merits, it was admitted that the plaintiff was an approved contractor of PWD, Public Health Department, Haryana. It was alleged that tenders were invited on 11.11.1990 by the Executive Engineer, PWD, Public Health, Division No. 2, Gurgaon and that the plaintiff submitted his tender "duly signed by him" and not by the representative and the rates quoted by the plaintiff in the said tender were under his own signatures. It was denied that the plaintiff had quoted the rate 9% instead of 90% by mistake. It was alleged that the tender submitted by the plaintiff was approved by the Executive Engineer @ 9% above CSR being the lowest amongst all the contractors, who had sumitted their tenders and its approval was conveyed to the plaintiff vide letter dated 27.11.1980. It was alleged that since the plaintiff did not start the work, notice dated 16.12.1980 was issued to the plaintiff and in response thereto a letter was received from the plaintiff on 22.12.1980 in which he had stated that he was unable to do the work at the rate of 9% above C.S.R. and that his earnest money of Rs. 800/- be refunded. It was alleged that in reply thereto, the plaintiff was informed vide letter dated 24.12.1980 to start the work and in response thereto, the plaintiff had written that he could not work @ 9% above CSR and sought the refund of the earnest money of Rs. 800/-. 800/- be refunded. It was alleged that in reply thereto, the plaintiff was informed vide letter dated 24.12.1980 to start the work and in response thereto, the plaintiff had written that he could not work @ 9% above CSR and sought the refund of the earnest money of Rs. 800/-. It was alleged that the said prayer of the plaintiff was rejected by the Executive Engineer and the plaintiff was informed vide letter dated 6.1.1981 and was asked to start the work failing which action would be taken against him as per the terms and conditions of the tender agreement. It was alleged that since the plaintiff failed to start the work, necessary penalties were imposed upon him in accordance with the terms and conditions of the tender agreement and the same were conveyed to the plaintiff vide letter dated 3.2.1981. It was denied that the Executive Engineer could not have imposed the penalty on the plaintiff or that the agreement was not signed by the plaintiff as alleged. It was alleged that in fact, the tender was part and parcel of the agreement. It was denied that the plaintiff had suffered any pecuniary loss, since the penalties had been imposed upon the plaintiff in accordance with the terms and conditions of the tender agreement. It was denied that the imposition of penalties was illegal and void. It was further alleged that the appeal filed by the plaintiff against the imposition of penalties, had rightly been rejected by the Superintending Engineer vide letter dated 12.6.1981 in accordance with the terms and conditions of the tender, which was part and parcel of the agreement and was legal. Various issues were framed. 4. After hearing both sides and after perusing the record, the learned Trial Court dismissed the suit of the plaintiff holding that the plaintiff having signed each and every page of the rate tender and contract for work, which was accepted by the Executive Engineer, the contract was complete and the penalties imposed upon the plaintiff were legal and according to the terms and conditions of the tender agreement. Resultantly, the suit was dismissed. However, the appeal filed by the plaintiff was partly accepted by the District Judge. Resultantly, the suit was dismissed. However, the appeal filed by the plaintiff was partly accepted by the District Judge. The findings recorded by the Trial Court on Issue No. 1 were set aside and it was held that the imposition of penalties on the plaintiffs were unauthorised and the order imposing these penalties was void and illegal snd not binding upon the plaintiff. Resultantly, the suit was decreed and the declaration sought for by the plaintiff was granted. However, the declaration was refused that the plaintiff will be deemed to be an approved Government Contractor. Aggrieved against the judgment and decree passed by the District Judge, the present Regular Second Appeals have been filed in this Court. RSA No. 410 of 1984 has been filed by the defendant State of Haryana challenging the findings of the learned District Judge on Issue No. 1 whereas RSA No. 418 of 1984 has been filed by the plaintiff, challenging the judgment and decree of the learned District Judge, whereby part of the claim of the plaintiff regarding approved Government contractor had been declined. 5. I have heard the learned counsel for the parties in both the appeals and have gone through the record carefully. 6. After hearing the learned counsel for the parties and perusing the record, in my opinion, the following substantial questions of law arise for determination in these appeals :- 1. Whether on the facts and circumstances of the present case, the tender agreement Exhibit D1 could be said to be illegal having not been executed by the Executive Engineer on behalf of the Governor of Haryana ? 2. Whether the letter imposing penalties upon the plaintiff could be held to be illegal and void on the ground that there was no legal and valid agreement between the parties ? 7. The learned counsel appearing for the defendant-appellant State of Haryana submitted before me that the learned District Judge had erred in law in reversing the findings of the Trial Court on Issue No. 1 and deciding the said issue in favour of the plaintiff and against the defendant. It was submitted that the learned District Judge has mis-read the tender agreement Exhibit D1 while observing that it was not signed by the Executive Engineer for and on behalf of the Governor of Haryana. It was submitted that the learned District Judge has mis-read the tender agreement Exhibit D1 while observing that it was not signed by the Executive Engineer for and on behalf of the Governor of Haryana. It has been submitted that the agreement in question was duly signed not only by the plaintiff, but also by the Executive Engineer for and on behalf of the Governor of Haryana and it was a valid document and it could to be said that there was no valid agreement between the parties. It was further submitted that since there was valid agreement between the parties, the Executive Engineer was perfectly justified in imposing penalties upon the plaintiff since he had failed to execute the work as per the terms and conditions of the tender agreement and the Superintending Engineer was perfectly justified in rejecting the appeal of the plaintiff. 8. After hearing the learned counsel for the parties and perusing the record, in my opinion, there is considerable force in these submissions of the learned counsel for the defendant-appellant State of Haryana. In my opinion, the learned District Judge had mis-read the agreement Exhibit D1. A perusal of the agreement Exhibit D1 would show that the same bears the signatures not only of the plaintiff but also of the Execute Engineer, Public Health, Division No. 2, Gurgaon "For and on behalf of Governor of Haryana" on the last page of the said tender agreement. The words "Executive Engineer, Public Health, Division, For and on behalf of Governor of Haryana" are printed at the end of the tender agreement. Instead of signing above these words, the Executive Engineer, Public Health, Division No. 2, Gurgaon, had signed the said agreement by the side of the said printed words and had put his rubber stamp underneath his signatures. In these circumstances, in my opinion, it could not be said that the Executive Engineer had not signed the said agreement "For and on behalf of Governor of Haryana". I am further of the opinion that on that account, the tender agreement in question could not e brushed aside by observing that the same had not been signed by the Executive Engineer for and on behalf of Governor of Haryana. As referred to above, this agreement is also signed by the plaintiff being "Contractor". I am further of the opinion that on that account, the tender agreement in question could not e brushed aside by observing that the same had not been signed by the Executive Engineer for and on behalf of Governor of Haryana. As referred to above, this agreement is also signed by the plaintiff being "Contractor". Besides this agreement Exhibit D1, there is letter dated 27.11.1980 Exhibit P1 from the office of the Executive Engineer, PWD, Public Health, Division No. 2, Gurgaon, to Yusuf Khan plaintiff in reference to his tender dated 11.11.1980. By virtue of the said letter Exhibit P1, the plaintiff was informed about the acceptance of his tender at the rates offered by him i.e. @ 9% above the Contract Scheduled of Rates (CSR). It was specifically mentioned in the said letter that the Executive Engineer had accepted his tender and the acceptance was being conveyed to him "For and on behalf of Governor of Haryana". Thus, in my opinion, it would be clear that not only in the acceptance letter Exhibit P1, but also in the tender agreement Exhibit D1, it was specifically mentioned that the Executive Engineer PWD, Public Health, Division No. 2, Gurgaon was signing the letter and the tender agreement for and on behalf of Governor of Haryana. Under these circumstance, in my opinion, it could not be said that there was no legal and valid agreement between the parties or that on that account, the Executive Engineer concerned was not competent to impose any penalty upon the plaintiff as per the terms and conditions of the tender agreement, especially when the petitioner had failed to complete the work, which was given to him as per the aforesaid tender. 9. Once it is found that the agreement in question was a perfectly legal and valid document, in my opinion, it would be clear that the Executive Engineer was legally competent to impose various penalties upon the plaintiff since the plaintiff had violated the terms and conditions of the contract agreement and had failed to execute the work, which was given to him under the tender agreement. In my opinion, the Executive Engineer had rightly imposed the penalty of Rs. 4000/- as compensation being 10% of the contract agreement besides forfeiting Rs. 800/- deposited as earnest money and also removing the name of the plaintiff from the approved list of contractors for future. In my opinion, the Executive Engineer had rightly imposed the penalty of Rs. 4000/- as compensation being 10% of the contract agreement besides forfeiting Rs. 800/- deposited as earnest money and also removing the name of the plaintiff from the approved list of contractors for future. I am further of the opinion that the Superintending Engineer was perfectly justified in rejecting the appeal of the plaintiff against the imposition of the aforesaid penalties and no fault could be found with the same. 10. In view of the detailed discussion above, the first substantial question of law framed above, is decided in favour of the defendant and it is held that the agreement in question is legal and valid as the same had been signed by the Executive Engineer for and on behalf of Governor of Haryana. The second substantial question of law framed above, is also decided in favour of defendant and it is held that the various penalties imposed upon the plaintiff by the Executive Engineer and upheld by the Superintending Engineer were perfectly legal and valid and no fault could be found with the letters issued by the Executive Engineer and the Superintending Engineer in this regard. For the reasons recorded above, the appeal bearing RSA No. 410 of 1984 is allowed whereas the appeal bearing RSA No. 418 of 1984 is dismissed, the judgment and decree dated 29.10.1983 passed by the District Judge, are set aside and the judgment and decree passed by the Trial Court are restored and the suit of the plaintiff is dismissed with no orders as to costs. Appeal allowed.