Sardar Sarovar Narmada Nigam Ltd. v. Jaiprakash Associates
2024-08-29
BIREN VAISHNAV, NISHA M.THAKORE
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DigiLaw.ai
JUDGMENT : Biren Vaishnav, J. 1. This First Appeal arises out of judgement and decree dated 29.09.2004 passed by the Civil Judge (S.D.), Bharuch in Civil Suit No. 221 of 1991. By the aforesaid judgement and decree, the suit of the respondent M/s. Jayprakash Associates for recovery of Rs.1,18,52,013/- was partly allowed and it was declared that the respondent – plaintiff was entitled for recovery of Rs.63,50,347/-. 2. Briefly stated, the facts before the trial court was that the respondent had filed a suit stating that it had been awarded work for construction of Rockfil Dam. On a tender being invited, the bid value offered by the plaintiff – respondent was Rs.37,03,27,311/-. During negotiations, a rebate of Rs. 4,07,36,000/- was offered on the tender value. It was the case of the respondent that no rebate on individual item rates was offered by the plaintiff and thus they were not related to the gross value of work. It was the case of the respondent – plaintiff that the tender was an item rate tender. Due to increase in quantities of certain items of work, the defendant appellant herein recovered about Rs.5.04 crores by way of rebate. Based on the interpretation of the tender terms, it was the case of the plaintiff that the recovery of Rs.63,50,347/- was not due and the defendant was not entitled to recover the said amount. The trial court based on the evidence on record especially concluding that in a prior civil suit being Special Civil Suit No. 265 of 1990, the issue was covered and which was not even challenged by the appellant, the present suit deserved to be decreed in favour of the respondent – plaintiff. 3. Mr. Rohan Lavkumar, learned counsel for the appellant would make the following submissions : (a) That the trial court erred in granting Prayer C of the suit restraining the defendant from recovering a sum of Rs. 63,50,347/-. That an injunction restraining a party from instituting and prosecuting proceedings in a court not subordinate is specifically barred by Section 41 of the Specific Relief Act, 1963. Hence the judgment and order dated 29th September 2004 is bad in law. (b) That the continuation of the suit was barred by Section 13 and 21 of the Gujarat Public Works Contracts Disputes Arbitration Tribunal Act, 1992.
Hence the judgment and order dated 29th September 2004 is bad in law. (b) That the continuation of the suit was barred by Section 13 and 21 of the Gujarat Public Works Contracts Disputes Arbitration Tribunal Act, 1992. Considering that the defendant had already raised same as a ground, the trial court ought to have transferred the proceedings to the tribunal. (c) That the trial court has granted relief beyond what was prayed for by the plaintiff and thus the judgment is bad in law. (d) That a perusal of the communication between the parties, more specifically communications dated 14th November 1980 and 21st November 1980 would indicate that the rebate offered and committed to by the plaintiff was an overall reduction of 11% of the contract value. The trial court’s finding that the 11% rebate was for a fixed sum of Rs. 4,07,36,004/- and would not be applicable on quantities towards price escalation as well as excess work is contrary to the evidence on record. 3.1 Mr. Lavkumar, learned advocate for the appellant would rely on the decision in the case of Cotton Corporation of India Limited vs. United Industrial Bank Limited and Others reported in (1983) 4 SCC 625 and submit that the trial court could not have passed a decree restraining the Corporation from resorting to a legal remedy. He would also submit that in light of the provisions of the Gujarat Public Works Contract Tribunal, the suit was barred. 4. Mr. Kashyap Joshi, learned counsel for the respondent – original plaintiff would support the judgement of the trial court and submit that essentially when the Civil Suit No. 265 of 1990 was decided in favour of the plaintiff and which was not challenged, the trial court committed no error in holding that it would operate as a res judicata against the defendant – appellant herein. 5. Perusal of the trial court’s decision would indicate that the trial court framed issues wherein Issue No. 2 was with regard to the allegation whether an over payment of Rs.63,50,347/- was made. Also Issue No. 12A indicated that the trial court framed issue whether the respondent plaintiff proved that the judgement in Special Civil Suit No. 265 of 1990 would act as res judicata.
Also Issue No. 12A indicated that the trial court framed issue whether the respondent plaintiff proved that the judgement in Special Civil Suit No. 265 of 1990 would act as res judicata. Perusal of the trial court’s decision under challenge would indicate that in Special Civil Suit No. 265 of 1990, Issue No. 8 was to the effect that the plaintiff proved that the rebate was through deduction at the rate of 11% from various payments admissible to the plaintiff. Issues no. 10 and 11 also would indicate that before the trial court in the previous suit, the court framed an issue to the effect whether the plaintiff proved that the rebate offered by the plaintiff can be added to the actual payment made for arriving at the value of work on which the price escalation is payable and whether the plaintiff proved that the defendant had earlier erroneously reduced the value of work done during various quarters by the amount recovered. It will also be further worthwhile to observe that Issue No. 25 was with regard to the issue of rebate of Rs.4,07,36,000/- by the plaintiff for the tender value. The trial court in the previous suit had extensively discussed the issue of rebate and the interpretation of whether it was a lumpsum rebate on interpretation of clause 14 of the tender. Considering paragraph no. 59 of the order of the trial court in the previous suit, the trial court found as under : “… I totally agree with submission of Mr. Joshi in this regard that, as per clause 38 which is pertaining to the price escalation. As it stands in tender agreement at Exh. 99, Page 109. And so, according to Mr. Joshi the defendants officer i.e. the In charge Executive Engineer were kind enough and they have sympathetically and considerably put the presentation of the plaintiff regarding the amount of escalation and after holding the meeting of the defendant's authorities (Board) the defendant authorities arrived at decision and they have given escalation mentioned in Exh. 69 of Rs.2.72 Crores to the plaintiff in the month of March, 1990. But as per the letter of dated: 18/08/1990 of Exh.
69 of Rs.2.72 Crores to the plaintiff in the month of March, 1990. But as per the letter of dated: 18/08/1990 of Exh. 69 of the officers of Executive Engineer, Narmada Division, Kevadia Colony, in which the plaintiff was asked by the defendant to make the repayment of the amount of escalation paid to the plaintiff, being over payment, and so, amount of Rs.2,14,53,528-00 the plaintiff was requested to refund to the defendant immediately, and failing which necessary action would be taken by the defendant. So, the present plaintiff has filed the present suit to restrain the defendant from making the recovery of Rs.2, 14,53,528-00 as asked in Exh. 69. The reply by the plaintiff at Exh.70 in which, at the particulars written by the plaintiff at Exh. 70, the plaintiff has on the contrary asked the defendant to pay him more amount of Rs. 61, 14,596-00. So, according to Mr.Joshi, the various documents produced in this case on behalf of the plaintiff as well as on behalf of the defendants after considering the entire documents the defendants have wrongly asked the recovery by letter Exh.69 and as such the interim injunction has been sought for along with the another demand of Rs. 61 Lacs. According to me, as it has been urged by the learned advocate for the plaintiff Mr. escalation is be claimed Joshi the price as dismissed above case, the plaintiff has completed its work in the month of June, 1989 and as asked for escalation for disputed issues the same issue was decided by the calling its meeting as well as the demand of the plaintiff was also put forth before directors of Nigam. And they have unanimously taken the decision in which they Rs. 4,07, 36, 005-21 is a lump sum rebate for which is entitled and have decided the plaintiff and paid Rs.2.72 Crores. And as such no defect is (illegible) on escalation of Rs.2.72 Crores entitled. But subsequently the audit authorities who has no concerned to raise any objection or who have no locus standi to see whether the escalation amount given to the plaintiff by the defendant is payable or not? still how ever, without any locus stand or skill full or expertise knowledge regarding the same and particularly when according to Mr.
But subsequently the audit authorities who has no concerned to raise any objection or who have no locus standi to see whether the escalation amount given to the plaintiff by the defendant is payable or not? still how ever, without any locus stand or skill full or expertise knowledge regarding the same and particularly when according to Mr. Joshi, the learned advocate for the plaintiff when during the course of arguments as has been vehemently urged by the learned advocate for the defendant Mr. Zaveri, Nigam is pleased with the work of the plaintiff M/s. Jaiprakash Associates which has been completed regarding the Sardar Sarovar Project for constructing rockfill dams in the Head Reach of Narmada Main Canal in Gujarat (India) and that work being of super quality; as it is desired and intended by the Nigam (defendant) and though as per the tender agreement certain work, from plus 130% which was performed by the plaintiff in this case regarding which the payment has to be made as per the tender agreement. And moreover, as and when the payments has been made to the plaintiff regarding the escalation. And there is controversy in the payment and in tender agreement Exh. 99. And as per the clause 38 regarding the escalation the payment has been made, within the strict meaning of clause 38 of the tender agreement. As I have discussed earlier in this judgment. I do not find any illegality in the payment of price escalation in this case, and the Nigam (Board) and directors have rightly taken the decision to pay the price escalation to the plaintiff of Rs.2.72 Crores. There is no any illegality in payment the said amount. Here merely because there is audit objection which has been raised by auditors when the payment of price escalation of Rs.2.72 Crores has been legally and rightly have been made by the defendant to the plaintiff, I do not find any illegality in it. As the same time, I do not find any collusion between the plaintiff and the Board's Officers, Executive Engineer, the In-charge-Engineer and officers of the Nigam has urged by the learned advocate for the defendant Shri Zaveri. In this case, because all the while it is utmost important in which every aspects of the case and particularly the escalation is based on the point of rebate when it was a lump sum rebate.
In this case, because all the while it is utmost important in which every aspects of the case and particularly the escalation is based on the point of rebate when it was a lump sum rebate. 64) And as I have concluded earlier, that it is a lump sum rebate, so, I of the opinion that decision taken by the board to give the price escalation Rs.2.72 Crores to the plaintiff. And that amount, which has been already given to the plaintiff cannot in any way disturbed when while, considering the entire evidence on record of this case, which has been produced by both the parties. So, I am of the opinion, it is crystal clear that in this case there is a lump sum rebate and regarding which in view of document Exh.83 and its last column page of document which reads as under : 11% than the price bid, contractors have accepted the conditions of Ann. 2 he has withdrawn all the conditions given earlier while submitted the tenders. During negotiations on 21/11/1980 be has reduced the rates and the lowest offer now comes to Rs. 32,66,55,021-01 Ps. Which is 45% above the estimated cost put to tender of Rs.21,77,98,464065 Ps. So from the above writing as well as from Exh. 85 and the bills Exh.86, 87 and 88, I am of the opinion that amount of price escalation given by the defendant's authorities to the plaintiff's is legal and valid. And there is no substance regarding the recoveries which has been asked by the defendant's board from the plaintiff as the strength of board decision, the difference of Rs.2.14 Crores as has been made in Exh. 69. So, taking the accounts of various documents which are on the record and from perusal of the same and considering the tender agreement Exh.99 and various clauses thereof, as per clause 38 which pertain with price escalation, At the same time, clause 14 which pertains to that authorities of Engineer-In-Charge, and in addition to it, clause 16 which pertains regarding the amount due to the contractor and clause-8 which is regarding the advancement of the final payment and Engineer-in-Charge to be entitled to the final statements and adjustment of accounts or otherwise in other way effects of contract.
The final bill shall be submitted by the contract within one month of the date fixed for the completion of work otherwise Engineer-in- Charge certificate of the measurement and of the total amount are payable for the work shall be final and binding upon shall the parties. So, here in this case, according to Mr. Joshi, the construction has been already completed in the year June, 1989 and within one month of the completion the bill has to be prepared and payment has to be made on the completion of the work. And the Engineer-In-Charge has measured the same and final bill is still pending but it is comes now turn for the defendant to finalize the bill as the amount of bill within one month has not been paid to the contractor and the final payment of bill be paid accordingly, keeping in view the escalation amount which been already given (Paid) to the plaintiff by the defendant, so according to Mr. Joshi, the payment which has already been made regarding the escalation price to the plaintiff by the defendant is legal and valid one, though the audit of the auditor of Nigam and the report thereof Exh.79 of the auditor of which the reply has been filed at Exh.89 regarding the price escalation at page 109 of tender agreement of clause 38 of tender agreement Exh. 99. Regarding which, the auditor has nothing to do with this, because according to Mr. Joshi, the auditor of the defendant and the present plaintiff have nothing to do with each other because there is no privity between the defendant auditor and the present plaintiff. So, in the absence of any privity between them, the objection taken by the auditor are vague void and without any base of law. I totally agree with this submission of Mr. Joshi on this aspect.” 6. The meaning of rebate was also discussed in context of price escalation and the trial court held as under : “… But as I have earlier discussed and, after perusing terms and conditions of the tender agreements and documents on record, I am of the opinion that the defendant board of directors have rightly taken the decision by which they have given price escalation to the plaintiff and the amount of Rs.2.72 Crores has been rightly paid up.
There is no question of getting refund, as per the letter of Exh.79 in view of various documents on record Exh.124, 125 and 126 as well as various documents of Exh.114 to 118, so, I do not find any sum and substance in the arguments of learned advocate for the defendant Shri Zaveri in this regard that the auditor has raised quarries and find it wrong payment though it is rightly paid (according to me) merely because the auditors say is that the payment which is already made is illegal and when it is not illegal as in view of my aforesaid discussion. Further more, according to me, price escalation has been given by the defendant to the plaintiff, keeping in view of the appreciation of various aspects, as I have already discussed regarding the price escalation… … Looking to the facts and of this case, at the same time, while considering the various relevant documents which have been produced in this case, and particularly the documents which are pertaining to the decision taken by the Board as discussed above by me. And the reasons assigned by me earlier, I am of the opinion that the decision taken in this case regarding the escalation price and the lump sum rebate which is rightly taken by the Nigam and its authority and that being a legal and valid one. I do not find any illegality in it. Merely because in Exh.79 there is an audit objection taken by the auditor who has no locus standi as earlier discussed and particularly in view of document Exh. 89 and 90 and the reasons assigned in Exh. 89 by the Executive and Supdt. Engineer and by the Chief Engineer, Navagam Dam Kevadia Colony at Exh.90, I am of the opinion that, they have taken correct decision on the subject matter and as such, the decision being all the while legal one. I do not find any illegality in it. So, in view of the aforesaid discussion, I answer the issues nos.7, 8, 9, 10, 11, 12, 14, 15, 16, 17 and 25 accordingly.” 7.
I do not find any illegality in it. So, in view of the aforesaid discussion, I answer the issues nos.7, 8, 9, 10, 11, 12, 14, 15, 16, 17 and 25 accordingly.” 7. Essentially, therefore, perusal of the judgement of the trial court in the present appeal would indicate that the submission made by the learned counsel for the appellant on interpretation of clause 14 of the contract in context of B2 tender was conclusively decided in the present suit which was a matter and issue directly involved in the previous suit and was not ancillary to the suit in question. In the present suit, therefore, the trial court, on interpreting the contract found that the issue was covered by the earlier decision. Para 36 of the decision of the present suit reads as under : “36. So far as issue no.12B is concerned, the burden to prove the fact under the said issue rest upon the defendant. The defendants in their written statement contended that Rs. 63,50, 347/- has been paid by the mistake and wrong interpretation of tender. I have already decided issues nos. 2 and 12 A in favour of the plaintiff holding that alleged recovery of above amount is illegal and unjust. Opened eye decision was taken by bilateral meeting of the plaintiff and board of directors of defendants and thereafter the alleged over payment was ordered to be made to the plaintiff. Opened eye decision cannot be branded as mistake when it has been taken after sequence of meetings. Here, I would like to mention that the alleged over payment has been claimed by the defendants which is not permissible, on the contrary it is illegal and unjust. Even for the sake of debate I would like to mention that the defendants have not based any evidence and nor placed any material from the audit report from which it can be gathered that the said amount is recoverable. Hence, I answer issue no.12B in negative and pass the following final order:” 8. As far as the decision with regard to the suit being barred under the provisions of The Gujarat Public Works Contracts Disputes Arbitration Tribunal Act, this court in a decision in the case of Ajay S. Patel, Engineers Contractors & Consultant reported in AIR 2007 Guj 150 in paragraphs no. 10 and 16 has held as under : “10.
As far as the decision with regard to the suit being barred under the provisions of The Gujarat Public Works Contracts Disputes Arbitration Tribunal Act, this court in a decision in the case of Ajay S. Patel, Engineers Contractors & Consultant reported in AIR 2007 Guj 150 in paragraphs no. 10 and 16 has held as under : “10. The Ordinance was published on 5th Dec. 1991 and thereafter the Act came into force only on 23rd Mar. 1992 while the suit was filed on 17th Sep. 1992. sub-sec. (3) of Sec. 1 of the Act provided that other provisions of the Act shall come into force on such date as the State Government may, by Notification in the Official Gazette, appoint. For that purpose, the State Government has issued a Notification dated 10th Dec. 1993 under Secs. 1, 2 and 3 of the Arbitration Tribunal Act, 1992 and by the said notification, the Government fixed the date with effect from 1st Jan. 1994 and the Tribunal to be called as "Gujarat Public Works Contracts Disputes Arbitration Tribunal" to exercise the jurisdiction, powers and authority conferred on it by or under this Ordinance. Therefore, Sec. 13 came into force only from 1st Jan. 1994 whereas the present suit had been filed on 17th Sep. 1992 and therefore, the suit was not hit by Secs. 13 and 21 of the Act and the Civil Court did not lose its jurisdiction to try and decide the suit pending on 1.1.1994. 16. In view of the aforesaid discussion, we have no hesitation in holding that there is error of law apparent on the judgment under review. The present suit filed by the original plaintiff on 17th Sept.1992 was maintainable because the bar under Sec. 13 of the Act was not applicable to the suits pending on 1.1.1994 when the Act came into force.” 9. For the foregoing reasons, appeal stands dismissed.