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2012 DIGILAW 118 (KER)

Paulose v. State of Kerala

2012-01-23

ANTONY DOMINIC

body2012
JUDGMENT : Petitioner is a contractor who is facing recovery proceedings initiated by the respondents. 2. According to the petitioner, the Water Resources Department floated tender in respect of the work "KIP RBC -Formation of Karunagapally Branch canal from Ch: 2360m to 6580m including CD works (Balance work)". This work was awarded to the petitioner, he being the lowest bidder. Accordingly, an agreement was entered into with-the department on 28/12/90. The period for completion of the work was 18 months and was later extended till 30.9.93. 3. Subsequently, on the allegation that the petitioner defaulted his work, by Ext.P1 order dated 18/1/1998, the contract was terminated at the risk and cost of the petitioner. He was thereafter issued Ext.P2 fixing the liability on him and enclosing Ext.P3 liability statement, in terms of which, the petitioner was found liable for an amount of Rs.5,84,363/-. Subsequently, by Ext.P4, he was informed that he will also be liable for 18% interest and that altogether his liability would be to the tune of Rs.16,06,340. 4. He was issued Ext.P5 notice to which he filed Ext.P6 objection disputing the breach itself. Thereupon Exts.P9 and P10 demand notices under the Revenue Recovery Act were issued and it is at that stage the writ petition has been filed. 5. The first contention raised in the writ petition is that the recovery proceedings are time barred. According to the learned counsel, the termination by Ext.P1 was ordered on 18/11/1998 and the requisition which led to Exts.P9 and P10 were issued only on 21/11/2009, This according to the petitioner is beyond the three years and therefore is time barred. However, in view of the provisions contained in Article 112 of the Limitation Act, the period of limitation available to Government debts is 30 years and if so, this objection raised by the petitioner does not have any merit. 6. It was then contended that this is a case where the breach itself is disputed by the petitioner and that therefore the respondents could not have unilaterally decided on the breach and quantified the damages if any due to them. In support of this contention, learned counsel relied on various decisions of this Court, the last of which is Shriram Engineering Construction Co. Ltd v. KSIDC (2001 (2) KLT 388). 7. In support of this contention, learned counsel relied on various decisions of this Court, the last of which is Shriram Engineering Construction Co. Ltd v. KSIDC (2001 (2) KLT 388). 7. It is too well settled a principle of law that party to the contract cannot be the arbitrator of his own cause. In this case, in the representations filed by the petitioner and in the pleadings, petitioner has disputed the breach alleged against him. In a case where breach is not admitted, in the absence of any enabling provision in the contract entitling one of the parties to decide on the breach itself, the only remedy available is to file a suit. Therefore, the respondents could not have decided on the question of breach nor could they have decided on the quantum of damages due to them. 8. Once the aforesaid principle is recognised, one will have to look at Ext.P3, the liability certificate to see whether the liability fixed on the petitioner is illegal or not. A reading of Ext.P3 shows that the amounts have been claimed from the petitioner towards the cost of unretumed departmental materials like cement, E.C bags, M.S Rod, Tor steel and copper sheet. When the department is calling upon the petitioner to refund the amount due to them towards the cost of unreturned departmental materials, such demand cannot be said to be quantification of damages but only reflects the actual amount due to ..the department. Such a quantification is perfectly within the power of the department and the principle aforestated can have no application. Therefore, the cost of unreturned materials can be quantified and demanded and to that extent the challenge against Ext.P3 cannot be accepted. 9. Yet another amount demanded from the petitioner is the liability towards unreturned plants/machineries. The items of plants/machineries are concrete mixer and vibrator. Referring to receipt dated 24/8/93 issued by one Sri.B.Radhakrishnan, the Assistant Engineer, counsel for the petitioner submits that these items of machineries have been returned and its receipt has been acknowledged. If this be the factual position, the cost of these items of machineries cannot be realised from the petitioner. Consequently, the demand for recovery towards loss in rent of unreturned plant/machineries also cannot be sustained. However, the exclusion of these two liabilities will depend upon the petitioner producing the receipt before the 4th respondent. 10. If this be the factual position, the cost of these items of machineries cannot be realised from the petitioner. Consequently, the demand for recovery towards loss in rent of unreturned plant/machineries also cannot be sustained. However, the exclusion of these two liabilities will depend upon the petitioner producing the receipt before the 4th respondent. 10. Yet another item of liability fixed on the petitioner is the liability towards rearranging of balance work and towards rectification work for rectifying leakage of syphon well. These two items of liabilities are very seriously opposed by the petitioner. In such a case, the respondents could not have unilaterally decided on the alleged breach committed by the petitioner nor could they have quantified the liability, if any, that of the petitioner. Therefore, the demand towards liability for rearranging the balance work and arrangement of rectification work cannot be sustained and are quashed. 11. Writ petition is therefore disposed of upholding the liability fixed on the petitioner for cost of unreturned departmental materials. As far as the liability towards unreturned plants/machineries and the alleged loss of rent in respect of the same are concerned, petitioner is directed to produce the receipt dated 24/893 referred to above before the 4th respondent within three weeks from today, in which event, the 4th respondent will consider the issue in relation to the aforesaid item of claim. The liability towards arrangement of work and the rectification of leakage of syphon well are quashed, but however, without prejudice to the right of the respondents to approach the Civil Court for realising the amount claimed.