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2024 DIGILAW 1514 (GUJ)

State Of Gujarat v. Associated Business Corp.

2024-07-05

BIREN VAISHNAV, NISHA M.THAKORE

body2024
JUDGMENT : BIREN VAISHNAV, J. 1. Both these appeals are filed under Section 96 of the Code of Civil Procedure. On being aggrieved by the judgement and decree dated 29.10.1996 passed by the 4th Joint Civil Judge (SD), Godhra, in Special Civil Suit No.54 of 1988, First Appeal No.1170 of 1997 has been filed by the State insofar as, the suit of the plaintiff (respondent in the appeal) has been partly allowed. First Appeal No.1606 of 1997 has been filed by the original plaintiff insofar as some of the claims were disallowed and though the decree prayed for was of Rs.44,01,542/-, the Trial Court awarded a decree of Rs.14,86,414/-. 2. Facts in brief are as under: 2.1 The appellant of First Appeal No.1606 of 1997 is a partnership firm and approved ‘A Class Contractor’. A work order was invited for construction of Halol Diversion on Godhra-Halol- Baroda road Section No.I. The tender was allotted to the plaintiff for an amount of Rs.30,741.32. The work order was issued on 20.02.1985 which was to be completed within 21 months on or before 20.11.1986. It was the case of the plaintiff before the Trial Court that the defendant committed a fundamental breach of the contract inasmuch as, it required working drawing, item wise program, possession of the land etc. were not handed over. The plaintiff therefore, filed the suit listing 29 claims as set out in the plaint. The Trial Court allowed some of the claims, whereas, some of the claims were disallowed. Hence, both these appeals. 3.Mr.Vivek Bhamare learned counsel appearing in First Appeal No.1606 of 1997 would submit as under: 3.1 Mr.Bhamare would submit that there was evidence on record to suggest that though the work was done, no payments were made. It was a specific case of the plaintiff appellant that tender documents were not handed over in time, technical drawings were not handed over, lands were not vacated by the land owners and therefore, various claims were made. Mr.Bhamare would take us through the evidence on each claim and submit that insofar as the claims which were not either entertained at all or partly allowed, the Trial Court had committed an error. With regard to each claim, his submission was as under: Claim-1: Mr.Bhamare would submit that the amount to be awarded was Rs.1,76,400/- whereas the award amount was Rs.1,60,200/-. With regard to each claim, his submission was as under: Claim-1: Mr.Bhamare would submit that the amount to be awarded was Rs.1,76,400/- whereas the award amount was Rs.1,60,200/-. Exhs.162, 165, 166, were referred to and it was submitted that it was admitted by the witness Shri N.V.Patel in cross-examination that earth work was done. In other words therefore, once there was clear admission of the work done, there should not have been a short payment. Claim-9: With regard to this claim Mr.Bhamare would submit that though the amount asked was Rs.1,60,000/-, awarded amount was Rs.80,000/- when it was an admitted fact that the contractor had carried out work of Rs.22,00,000/- out of Rs.30,00,000/- and therefore, 20% of the amount of the difference of the work would come to Rs.1,60,000/-. Claim-14: This claim was also not granted by the Trial Court, Mr.Bhamare would want us to refer to Exhs.79 and 80 and submit that it was clearly stated in the cross-examination of the witness of the defendant Shri N.V.Patel that the plaintiff had suffered a loss due to non-receipt of the entire possession of the land for the road to be constructed. The Trial Court committed an error in holding that the claim was too general. The evidence on record indicated that earth work was done that there was carting and staking of metal sand soft murrum and earth work of which measurements were on record. Claim-15: Where the claim was on account of loss suffered by the strike of Government Servants from 07.06.1985 to 19.08.1985, where it was claimed that the loss suffered was Rs.7,32,000/-, the trial Court awarded only Rs.5,47,500/-. Mr.Bhamare would submit that it was not disputed that the Government Servants were on strike and in accordance with clause-16 of the tender, trucks engaged for collecting metal, sand etc. were not operated and therefore the claim should have been allowed in its entirety. The Trial Court committed an error in granting compensation counting Rs.5000/- per day. Claim-16: This claim was completely disallowed. Mr.Bhamare would submit that it was specifically admitted in the crossexamination that the schedule of rates was prepared by the department after considering the rise of rates and materials and labour and fuel. In Exh.54 the plaintiff had clearly mentioned that if the possession of the land was not given, the defendant will have to pay that person price rise for the work done. In Exh.54 the plaintiff had clearly mentioned that if the possession of the land was not given, the defendant will have to pay that person price rise for the work done. There was no denial to the letters at Exh.54, 82, 109 and 111. Claim-17: With regard to this claim, where it was claimed that there was loss suffered at the rate of 20% due to prolonging of the work, the Trial Court committed an error in saying that no evidence was led. It was admitted in the crossexamination of Shri N.V.Patel and also from the letters at Exhs.64, 84, 86, 90, 91, 92 that the plaintiff had informed the defendant that it will be responsible for all losses and damages due to prolonging of work. Claim 18: Denial of this claim is also misconceived as letters at Exhs.92 and 110 by the plaintiff were not replied to and it was admitted that an amount of Rs.9,26,809/- was not paid. Claim-19: Mr.Bhamare would submit that additional expenditure was incurred for certain works and a letter of the contractor at Exh.87 indicates that these additional works were done at the instance of the defendant. A notice was served at Exh.128 showing the additional work carried out which claim was disallowed. Claim-27: This claim was also not granted on an erroneous finding. From the correspondences produced at Exhs.80, 86, 93 and 109, it is clear that the work had remained suspended for over 4 months and therefore, compensation under the agreement was rightfully due to the plaintiff. Claim-28: Mr.Bhamare would invite the Court’s attention to the relevant exhibits and the cross-examination of Shri Patel and submit that this claim should have been fully allowed. Accordingly, Mr.Bhamare would submit that the entire 29 claims ought to be allowed. The claims which were partly allowed should have been fully allowed and the claims denied should be granted based on the evidence on record. 4. In First Appeal No.1170 of 1997, Mr.Akash Chhaya learned AGP would submit that the claims which have been allowed were wrongfully allowed and there was no evidence to suggest that the work was delayed as a result of late handing over of the possession. 4. In First Appeal No.1170 of 1997, Mr.Akash Chhaya learned AGP would submit that the claims which have been allowed were wrongfully allowed and there was no evidence to suggest that the work was delayed as a result of late handing over of the possession. 4.1 He would submit that the learned Judge should have appreciated that the witness of the department Shri N.V.Patel had pointed out that more than 90% of the work was completed by the plaintiff and from the evidence at Exh.113, most of the land was handed over for making of the road. Technical designs and drawings were handed over in time and the claim Nos.1, 2, 3, 9, 12, 13, 15, 20, 27 and 29 could not have been allowed. 4.2 Mr.Chhaya would submit that even when there was strike of 73 days, arrangements were made and instructions were given to see that no work should suffer for want of technical advise. 4.3 He would submit that the Trial Court therefore came to the erroneous conclusion in allowing the claims which were so allowed by the Trial Court. 5. Having considered the submissions made by the respective counsels and perusal of the Trial Court’s judgement and evidence indicate that of the 29 claims made by the original plaintiff, appellant of First Appeal No.1606 of 1997 on consideration of evidence on record, the Trial Court has come to conclusion after drawing of issues at Exh.9 by holding that part of the claims are allowed. It is the essential case of the plaintiff that the defendant State Government had failed to perform its reciprocal contractual obligation and therefore, the defendant had committed a fundamental breach of the contract. Briefly stated, as is evident from the contents of the plaint that on several issues according to the plaintiff, there was delay on the part of the respondents to make available necessary drawings and designs, delay in handing over the entire work site and as a result thereof, the plaintiff could not utilize their labour material and work force so as to complete the work within the stipulated time. The evidence of the plaintiff is on record. Dadubhai Shankarbhai Patel has been examined at Exh.23. His cross-examination would reveal that there was delay in handing over the site, as a result of which, the work could not be carried out within the stipulated time. The evidence of the plaintiff is on record. Dadubhai Shankarbhai Patel has been examined at Exh.23. His cross-examination would reveal that there was delay in handing over the site, as a result of which, the work could not be carried out within the stipulated time. Cross-examination of the witness of defendant Shri N.V.Patel also indicates that the plaintiff could not unload the necessary raw material for carrying out the constructions of the road as a result of not handing over the site which was occupied by the farmers. It is evident from reading the claim at Exh.59 that a notice was given by the plaintiff to the defendant. The land acquisition proceedings were still under progress and that possession of the land was not handed over. The Trial Court has report a notice issued by one Kashiben at Exh.171/2 to the plaintiffs to not to enter the land in question which admittedly indicates that the plaintiffs were prevented from beginning execution of the project in question from the date when the work order was issued to them. 5.1 Exh.153 is a communication when read with Exh.154, as observed by the Trial Court, indicates that essentially there was a breach on behalf of the defendant in four ways viz. not timely handing over the road site, short payment, orders for supply of cement and steel were not issued and designs specifications were not made. From the cross-examination of the witness of the department at Exh.147, it is borne out that the parties i.e. the defendant could not get possession of certain lands as a result of a dispute between the owners and the acquiring body and it was on this count that the deponent had clearly stated that there is nothing on record to show in terms of a Kabja pavti to suggest that the possession of the land was handed over before 15.09.1987. He also denies the knowledge of the drawings at Exh.154. There is contradiction when his cross-examination is perused. It is in light of this evidence that the Trial Court came to the conclusion that from the record it was seen that the plaintiff was not having the entire site for the construction on the road. Even though the work order was issued on 20.02.1985. There is contradiction when his cross-examination is perused. It is in light of this evidence that the Trial Court came to the conclusion that from the record it was seen that the plaintiff was not having the entire site for the construction on the road. Even though the work order was issued on 20.02.1985. 5.2 Exh.147 is the evidence of the deponent Shri N.V.Patel for the department which also when read, indicates that when he took over the charge of the Halol Sub-Division, the entire site was not available to the plaintiff for carrying out the project. It is on this count that the Trial Court observed, and in our opinion, rightly so, that there was a cumulative effect of the evidence on record that the entire possession of the road site, was not handed over to the plaintiff. 5.3 With regard to receiving short payments, it is evident from the letter at Exh.52 written by the plaintiff to the Executive Engineer that a fifth running bill had been submitted and a request was made that the amounts be released so that further progress of the work can be planned. To this letter, there was no response. Exh.53 was also a letter written by a plaintiff to the Executive Engineer that as and when possession of land was handed over, work would be carried out. 5.4 At Exh.88 is a letter again by the plaintiff that as early as on 24.11.1986 they had informed the defendants that a stretch of work had been completed and amounts towards spreading of ‘murraum’ and other works were due from the defendant which was not paid and therefore, a meeting was called for as the work as stipulated in the time limit was completed. No evidence to the contrary was produced by the defendants and the trial Court therefore in our opinion rightly came to the conclusion that the breach on that count was also completed by the defendants. 5.5 With regard to short supply of cement and steel, the plaintiff gave a notice to the defendant to produce documents and registers. Reading of the notice would indicate that the plaintiff had asked for possession and power to produce original ground level books along with field books, stock registers, details of cement stock issued to the contractor, inspection notebook, site account register, log books for road rollers, consumption of cement and steel register etc. Reading of the notice would indicate that the plaintiff had asked for possession and power to produce original ground level books along with field books, stock registers, details of cement stock issued to the contractor, inspection notebook, site account register, log books for road rollers, consumption of cement and steel register etc. so as to substantiate their case. Obviously since the details of this consumption were recorded in these documents at the hands of the defendants, in absence to produce the same, the Trial Court in our opinion, rightly, drew adverse inference against the defendants. 5.6 Having perused the orders of the Trial Court and the documents especially letters at Exh.64 and 66, it is evident that the fault lay at the hands of the defendants. Reading the letter at Exh.68 produced by the plaintiff would indicate that after the monsoon season, for over 7 months the plaintiff had tried to complete the work. However, the progress could not be made as a result of the land acquisition dispute. The Railway Authorities did not allow the plaintiff to work near the railway crossing and whatever work was carried out was removed by them as a result of which, the schedule was pushed back by two months. The department also could not make any payments for want of budget to the claimants of the land. 5.7 Letter at Exh.79 at the hands of the defendant and so also letter at Exh.80, it was pointed out by the plaintiffs that land acquisition proceedings were still not concluded and the machinery were lying at the site without any work in progress and despite repeated requests to the Executive Engineer, no progress was being made. 5.8 Even in a letter at Exh.89 at the hands of the plaintiffs, it was pointed out that the plaintiff was keen to carry out the work of slabs and they were willing to carry out the mud work. However, the cement was not being supplied by the defendants‘ contractors. 5.9 Exh.111 also is a letter which indicates that repeated concerns were raised by the plaintiffs of short payments for the work carried out and nonpayment of the amounts of the running bill. However, the cement was not being supplied by the defendants‘ contractors. 5.9 Exh.111 also is a letter which indicates that repeated concerns were raised by the plaintiffs of short payments for the work carried out and nonpayment of the amounts of the running bill. All these evidences conjointly were appreciated by the Trial Court and which we have also independently assess that apart from these letters on record and non-production of certain important registers at the hands of the defendants, the Trial Court, in our opinion rightly came to the conclusion that there were lapses on the part of the defendants to comply with the contractual agreement and therefore, certain claims of the plaintiff were allowed by the Trial Court. Perusal of the claim-wise discussion would indicate that the Trial Court as far as claim 1 is concerned, based on the letters relied upon by the Trial Court at Exhs.162 and 166, it is clear that prorata claim has been entertained by the Trial Court. Claims 2 and 3 have, in our opinion, been rightly allowed because it was admitted by the deponent of the department in his cross-examination that the department had no right to retain the deposits. With regards to claims 4 and 5, they were in our opinion, rightly not allowed. Claim 9 was, as is evident, was partly allowed to the extent of 50% of the total claim i.e. 10% in light of the fact that majority of the work for an amount of Rs.22 lakhs was already carried out and it was therefore that the Trial Court, in our opinion, rightly computed the loss at 10%. The other claim which was disallowed was claim 14. This was in accordance with clause 9 of the tender agreement. With regard to the stand of the State insofar as it allowed claims 12 and 13 partly, in light of the fact that the department did not produce any records, measure books, register etc. it does not lie in their mouths to challenge these claims. This was in accordance with clause 9 of the tender agreement. With regard to the stand of the State insofar as it allowed claims 12 and 13 partly, in light of the fact that the department did not produce any records, measure books, register etc. it does not lie in their mouths to challenge these claims. In fact, as far as the claims which have been granted by the Trial Court in favour of the plaintiff, based on the evidence which we have discussed and appreciated in light of the documents produced before us and so appreciated, the Trial Court in our opinion has rightly come to the conclusion that those claims which have been granted either fully or partly, mainly because of the admitted fact that the Court found a fundamental breach in the contract. 6. We have observed from the reasoning of the Trial Court that based on the documentary evidence produced on record, each claim has been assessed and it was found that the best evidence that was available with the defendants was not produced. The tenor of the letters on records at the hands of the plaintiff would indicate that at each and every stage they have informed the defendants of the shortcomings in carrying out their terms of the contract and the breaches as set out in the judgement of the Trial Court and we on reassessment of evidence find that no other view except the view that the Trial Court has taken is possible. 7. For the aforesaid reasons, both the appeals viz. that of the original plaintiff i.e. First Appeal No.1606 of 1997 and First Appeal No.1170 of 1997 of the original defendant-State are dismissed with no order as to costs.