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2017 DIGILAW 336 (TRI)

Phanindra Kishore Pal, Son of Late Ashiwini Kumar Pal v. State of Tripura, Represented by The Secretary to the Government of Tripura, Revenue Department, Civil Secretariat

2017-08-18

T.VAIPHEI

body2017
JUDGMENT & ORDER : Challenge in this appeal is to the judgment dated 31-5-2011 passed by the learned Civil Judge (Senior Division), Kailashahar, North Tripura in Money Suit No.02 of 2010 dismissing the suit. 2. The facts giving rise to the appeal may be briefly stated. The appellant, who is the plaintiff in the suit, in response to the quotation invited by the State-respondents for supply of different types of plants for the year 2008-09, participated in the tender process and was selected and was issued the supply order under certain terms and conditions stipulated therein. It is the case of the appellant that he supplied all the plants contracted for to the respondents and their representatives with their full satisfaction with respect to the quality, quantity and character of the plants, etc. He also received the receipts of the said plants from the respondents. He accordingly submitted his final bills amounting to Rs.15,47,667/- in triplicate on 17-3-2009 to the respondent No. 3, but he refused to make the payment even after the lapse of long period. The repeated requests made to the respondent No. 3 to this effect proved futile whereupon he on 3-12-2009 finally issued statutory notice under Section 80(1) of the Code of Civil Procedure, 1908 upon the respondents through his Advocate by registered posts, but no payment was forthcoming even after the expiry of the statutory period of 60 days. This prompted him to institute the suit for recovery of Rs.15,47,667/- from the respondents. 3. The suit was resisted by the respondent authorities, who filed their written statement. It is the case of the respondents that the conditions of the supply order were not fulfilled by the appellant as the supplied materials were not received by the respective implementing officers in most of the Panchayats; it was the condition of the supply order that the plants should be supplied to the implementing officers at the work site within ten days of the receipt of the supply order. The bills submitted by the appellant did not have receipts with the signatures of the respective implementing officers contrary to the supply order. Thirteen challans of the appellant in respect of the supplied plants were received during the months of October, 2008 against the supply orders of the respondents through the Panchayat Secretary, Pradhan and Members, etc. only. The bills submitted by the appellant did not have receipts with the signatures of the respective implementing officers contrary to the supply order. Thirteen challans of the appellant in respect of the supplied plants were received during the months of October, 2008 against the supply orders of the respondents through the Panchayat Secretary, Pradhan and Members, etc. only. It is the further case of the respondents that due to the supply of the materials beyond the time stipulated by the supply orders, the season of planting became completely unfavourable and resulted in high mortality of the saplings. Due to breach of contract in the supply of the planting materials, the Rural Development Department (RD Department) on 15-10-2008 instructed the BDO, Salema (respondent No. 3) to suspend all the supply orders and conduct an enquiry into the lapses. It is also the contention of the respondents that the ADM/Dhalai on 17-12-2008 conducted an enquiry and thereafter in consultation with the respondent No. 3 made the proposal dated 2-9-2009 was submitted to the RD Department for making payment of some specified bills. On receipt of the said proposal, the RD Department requested the District Administration, Dhalai and their agencies to place the matter before the Panchayat Samity/Block Advisory Committee meeting of Salema RD Block and take resolution for making payment of the bills submitted by the appellant. The Agricultural Standing Committee of Salema Panchayat Samiti constituted a four members committee on 23-3-2010 to find out and scrutinize the factual numbers of supplied materials by the appellant as per supply orders, and the findings of the Committee were as follows: (1) As per Order No. F. 14(63-5)/BDO/SLM/NREGP/2008-09/4989-93(Q-T) dated 27-8-2008 for supply of 400 Litchi plants, one bill amounting to Rs.48,000/- was submitted. Xerox copies of 5 challans with signature of receivers were available against supply of 4000 Litchi plants. (2) As per order No. F-14(63-5)BDO/SLM/NREGP/2008-09/4985 & 4989-93 (A-Z) dated 27-8-2008 for Mendi- 3003, Simbukchak-3366, Noagaon-6200, Dhanchandra- 2480, Setrai-3720, Panboa-3720, Shyamraichara-3675, East Lambuchara-465, Marachara-3720, Panboa-3720, Manikbhandar-3720 in total for 37,789 items, 8 bills amounting to Rs.14,37,711/- were submitted claiming supply of 43,563 plants. Only Xerox copies of 12 challans with receipt signatures against supply of 37,789 Banana plants were available. 4. It is the further case of the respondent authorities that the appellant made false claims amounting to Rs.15,47,667/-, but there is no original receipt copy of supply against the supply order. Only Xerox copies of 12 challans with receipt signatures against supply of 37,789 Banana plants were available. 4. It is the further case of the respondent authorities that the appellant made false claims amounting to Rs.15,47,667/-, but there is no original receipt copy of supply against the supply order. There were many discrepancies in the supply of the appellant. The appellant‘s bills and receipts with signatures with the office record of receipt department did not tally; the bills claimed were excessive. 5. On the pleadings of the parties, the following issues were framed by the trial court: 1. Whether there is any cause of action in favour of the plaintiff for filing the suit? 2. Whether the plaintiff had supplied the materials as per supply order? 3. Whether the plaintiff is entitled to get decree as prayed for? 4. Whether the parties are entitled to get any relief or relieves? 6. In the course, two witnesses were examined by the appellant as PW-1 and PW-2 to prove his case. Several documents were also exhibited by the appellant to substantiate his case. The respondent authorities, however, examined only one witness to prove their case and tendered the following documents: 1. Memorandum of BDO, Salema dated 16-8-08 series Exbt. A 2. 13 copies of challans -do- 3. Report of BDO, Salema in 17 sheets -do- 7. At the conclusion of the trial, the learned Civil Judge passed the impugned judgment dismissing the suit. The learned Civil Court found that there was no dispute that 8 supply orders (Ext. 2 series) were issued by the respondent No. 3, and the same were accepted by the appellant as per the terms and conditions stated therein. The trial court also found from challans (Ext.–1 series) that the appellant supplied a total of 38,589 banana plants and 4000 litchi plants. The trial court, however, found that the appellant failed to prove the authenticity and correctness of the challans (Ext. 1 series) by producing the persons or implementing officers to whom and at which sites the plant materials were delivered or supplied; mere exhibition of documents did not dispense with proof. The trial court then recorded the finding that if these papers were left out of consideration, the only evidence left is the bare statements of the appellant and PW-2 remained and oral evidence alone could not prove his case. The trial court then recorded the finding that if these papers were left out of consideration, the only evidence left is the bare statements of the appellant and PW-2 remained and oral evidence alone could not prove his case. Having said that, the trial court nevertheless proceeded to decide the question as to whether the appellant supplied the plant materials as per the terms and conditions of the supply orders and held that the appellant did not supply the materials within 10 days from the date of receipt of the supply order and that the supplies were not made at the work site in consultation with the implementing officers, which were contrary to the terms and conditions of the supply orders. The trial court took note of the voluntary statement made by the appellant in his cross-examination that he supplied plant materials beyond the specified time of 10 days of the receipt of the supply order as per verbal instructions of the respondent No. 3 and held that he failed to prove that the respondent No. 3 instructed him to supply the materials even after the expiry of the time specified in the supply orders. The learned Civil Judge, therefore, concluded that the appellant violated the terms and conditions of the supply orders in supplying plants materials. To say the least, the trial court is apparently unable to differentiate between the question as to whether the appellant supplied at all the plant materials and the question as to whether the appellant did not supply the materials as per the terms and conditions of the supply orders. Had the appellant failed to supply any plant materials as found by him, where is the question finding out as to whether the plants were not supplied as per the terms and conditions of the supply orders? 8. Be that as it may, from the evidence of DW-1 (BDO, Salema), it is proved that the plant materials/saplings were supplied by the appellant to, and were received by the officials of the respondent No. 3, but the same were not supplied within the specified period, which were mentioned in the terms and conditions of the supply orders. He testified that the planting materials were received during the month of October, 2008 against the supply orders through Panchayat Secretary/Pradhan/Members/GRS of respective GP/VC by 13 challans of green view nursery. He testified that the planting materials were received during the month of October, 2008 against the supply orders through Panchayat Secretary/Pradhan/Members/GRS of respective GP/VC by 13 challans of green view nursery. He also deposed in his examination-in-chief that the longer time lapse made the season (end of September and October) completely unfavourable for plantation resulting in high mortality of the saplings; the receiving authorities received the planting materials giving dates on the challans on several dates. It is also the testimony of the respondent No. 3 that though the supply order stipulated that the planting materials should be supplied at the work site after consultation with the implementing officers, i.e. materials should be received by the respective implementing officers, the supply materials were not received by the respective implementing officers in most Panchayats. Thus, from the own showing of the respondents, it becomes as clear as daylight that the planting materials/saplings contracted to be supplied were actually received in full by the respondents. Admitted facts need not be proved. However, the disputes raised by them are with respect to the irregularities in executing the supply orders, namely, violation of the prescribed procedure for receiving the supplied items through the implementing officers and of the failure to supply some of the items within the time prescribed by the supply orders, i.e. within the 10 days of the receipts of the supply orders. Even in this field also, the case of the respondents have no legs to stand on once the planting materials were found to be received by them. It is true that Clause 1 of the terms and conditions of the supply order stipulated that supply of materials should be completed within 10 days from the date of the receipt of this notice. Seemingly, it can be argued, without anything more, that time was of the essence of the contract. Section 55 of the contract Act 1872 (“the Act” for short) provides for special rule in regard to the performance of a promise to do a certain thing at or before a specified time. Contracts, for the performance of which definite time is fixed, must be completed within the time limited, but then it is the duty of the court to look at the pith and substance of the contract and decide whether time was of the essence of contract or not. Contracts, for the performance of which definite time is fixed, must be completed within the time limited, but then it is the duty of the court to look at the pith and substance of the contract and decide whether time was of the essence of contract or not. Section 55 of the Contract Act, 1872 is in the following terms: “55. Effect of failure to perform at a fixed time, in contract in which time is essential.—When a party to a contract promises to do a certain thing at or before a specified time, or certain things at or before specified times, and fails to do any such thing at or before the specified time, the contract, or so much of it as has not been performed, becomes voidable at the option of the promisee, if the intention of the parties was that time should be of the essence of the contract. Effect of such failure when time is not essential.—If it was not the intention of the parties that time should be of the essence of the contract, the contract does not become voidable by the failure to do such thing at or before the specified time; but the promisee is entitled to compensation from the promisor for any loss occasioned to him by such failure. Effect of acceptance of performance at time other than that agreed upon.— If, in case of a contract voidable on account of the promisor’s failure to perform his promise at the time agreed, the promisee accepts performance of such promisee at any time other than that agreed, the promisee cannot claim compensation for any loss occasioned by the non-performance of the promise at the time agreed, unless, at the time of such acceptance, he gives notice to the promisor of his intention to do so.” 9. Thus, when a party, who has promised to do a certain thing at a specified time, fails to do it at or before that time, the contract becomes voidable at the option of the promise, if the intention of the parties was that time was of the essence of the contract. But if it is not the intention of the parties that time should be of the essence of the contract, the contract does not become voidable by such failure, but the promisee is entitled to damages for loss caused to him by such failure. But if it is not the intention of the parties that time should be of the essence of the contract, the contract does not become voidable by such failure, but the promisee is entitled to damages for loss caused to him by such failure. In the case at hand, even though the appellant admittedly failed to deliver the planting materials within the time stipulated therefor, the respondents did not repudiate the contract or cancel the supply orders. The Third Paragraph of Section 55 of the Act is, therefore, important for our purpose. It says that if time is of the essence of contract, and if the promisee accepts performance later, the promisee cannot claim compensation for any loss caused by delay, unless he has given notice of such intention to the promisor when he accepted the performance. Thus, where a party waives his right by taking benefit under a contract after the time fixed under the contract has lapsed or after a condition stipulated has not been fulfilled, he cannot rely on time being of the essence of contract or the condition being ‘the root of the matter’, in order to avoid a contract. In other words, a claim for compensation under this section would be barred, if the promisee accepts performance after the stipulated time, unless he had given notice to the promisor of his intention to claim compensation at the time of the delayed acceptance. In the instant case, the respondents have admittedly received the planting materials/saplings contracted to be supplied by the appellant beyond the time stipulated by the Clause 1 of the terms and conditions of the supply order and have even paid 40% of the contracted price. No notice was given to the appellant by the respondents of their intention to claim compensation at the time of delayed acceptance. Therefore, the respondent authorities are barred from avoiding the contract. 10. The second point for consideration is whether the respondents have the right to retain the planting materials already supplied in full by the appellant. Clause 5 of the terms and conditions of the supply order provides that supply should be made at the work site after consultation with the implementing officer. 10. The second point for consideration is whether the respondents have the right to retain the planting materials already supplied in full by the appellant. Clause 5 of the terms and conditions of the supply order provides that supply should be made at the work site after consultation with the implementing officer. In the instance case, the stance taken by the respondents in this behalf is not that the materials were not supplied by the appellant, but it rather is that the materials were not delivered at the work site in consultation with the implementing officers. In other words, they chose to retain the materials supplied by the appellant, but they refused to pay the bills except for 40% of the price contracted for. In my opinion, this conduct on the part of the respondents is barred by the doctrine of unjust enrichment. The term “unjust enrichment” simply means retention of a benefit by a person that is unjust or inequitable. “Unjust enrichment” occurs when a person retains money or benefits which in justice, equity and good conscience, belong to someone else. The Apex Court has an occasion to deal with this doctrine in Sahakari Khand Udyog Mandal Ltd. v. CCE & Customs, (2005) 3 SCC 738 and observed: “151. Unjust enrichment has been defined as: “Unjust enrichment.—A benefit obtained from another, not intended as a gift and not legally justifiable, for which the beneficiary must make restitution or recompense.” See Black’s Law Dictionary, 8th Edn. (Bryan A. Garner) at p. 1573. A claim for unjust enrichment arises where there has been an “unjust retention of a benefit to the loss of another, or the retention of money or property of another against the fundamental principles of justice or equity and good conscience”. 152. “Unjust enrichment” has been defined by the court as the unjust retention of a benefit to the loss of another, or the retention of money or property of another against the fundamental principles of justice or equity and good conscience. A person is enriched if he has received a benefit, and he is unjustly enriched if retention of the benefit would be unjust. Unjust enrichment of a person occurs when he has and retains money or benefits which in justice and equity belong to another. 153. A person is enriched if he has received a benefit, and he is unjustly enriched if retention of the benefit would be unjust. Unjust enrichment of a person occurs when he has and retains money or benefits which in justice and equity belong to another. 153. Unjust enrichment is “the unjust retention of a benefit to the loss of another, or the retention of money or property of another against the fundamental principles of justice or equity and good conscience”. A defendant may be liable “even when the defendant retaining the benefit is not a wrongdoer” and “even though he may have received [it] honestly in the first instance”. (Schock v. Nash, 732 A 2d 217 (Delaware 1999) 154. Unjust enrichment occurs when the defendant wrongfully secures a benefit or passively receives a benefit which would be unconscionable to retain. In the leading case of Fibrosa Spolka Akcyjna v. Fairbairn Lawson Combe Barbour Ltd., 1943 AC 32 : (1942) 2 ALL ER 122 (HL), Lord Wright stated the principle thus: “… Any civilised system of law is bound to provide remedies for cases of what has been called unjust enrichment or unjust benefit, that is to prevent a man from retaining the money of or some benefit derived from another which it is against conscience that he should keep. Such remedies in English law are generically different from remedies in contract or in tort, and are now recognised to fall within a third category of the common law which has been called quasi-contract or restitution.” 155. Lord Denning also stated in Nelson v. Larholt, (1948) 1 KB 339 : (1947) 2 All ER 751 as under: (KB p. 343) “… It is no longer appropriate, however, to draw a distinction between law and equity. Principles have now to be stated in the light of their combined effect. Nor is it necessary to canvass the niceties of the old forms of action. Remedies now depend on the substance of the right, not on whether they can be fitted into a particular framework. The right here is not peculiar to equity or contract or tort, but falls naturally within the important category of cases where the court orders restitution, if the justice of the case so requires.” 156. The above principle has been accepted in India. This Court in several cases has applied the doctrine of unjust enrichment.” 11. The right here is not peculiar to equity or contract or tort, but falls naturally within the important category of cases where the court orders restitution, if the justice of the case so requires.” 156. The above principle has been accepted in India. This Court in several cases has applied the doctrine of unjust enrichment.” 11. As already noticed from the admitted facts on record, the respondents ought to have cancelled the supply orders issued by them once they found that the deliveries were made beyond the time stipulated by the supply orders issued by them and refused to accept the materials by clearly sending a message that they were entitled to compensation from the appellant for any loss occasioned to them by such failure. They did not do so. At the same time, they did not refuse to accept the materials; in fact, they allowed the appellant to deliver the materials beyond time and, that too, not at the work sites or in consultation with the implementing officers in breach of contract. They also refused to pay all the bills for the materials supplied by the appellant as quantified in the supply orders. They chose to make payment of the bills submitted by the appellant only to the extent of 40% thereof. In my opinion, this is not expected from the Government of law. On the contrary, they permitted to enrich themselves unjustly and against equity and good conscience. In the view that I have taken, the impugned judgment cannot be sustained in law and is liable to be set aside. The appellant is rather entitled to the decree claimed in the suit. 12. In premises set forth above, this appeal succeeds. The impugned judgment dated 31-5-2011 passed by the learned Civil Judge (Senior Division), Kailasahar in Money Suit No.02 of 2010 is, accordingly, set aside. The appellant is entitled to payment of the remaining 60% of the billed amount equivalent to the appeal value with interest @ 9% per annum from the institution of the suit till the full payment thereof with cost. Let a decree be prepared accordingly. Transmit the LC record.