Patna High Court
Case Details
IN THE HIGH COURT OF JUDICATURE AT PATNA Civil Revision No.2 of 2013 ====================================================== the Principal Secretary Road through 1. The State of Bihar Construction Department , Bihar, Patna 2. The Engineer-in-Chief, Road, Construction Department, Bihar, Patna. 3. The Chief Engineer, South Bihar Wing, Road Construction Department, Bihar, Patna. 4. The Superintending Engineer, Bhojpur Road Circle, Ara. 5. The Executive Engineer, Sahabad Road Division, Ara. .... .... Petitioner/s Versus M/S Bansidhar Construction Pvt. Ltd. at Patila, Maner, Patna through its Director, Ram Prasad Roay son of late Kisun Dayal Road, resident of village Patila, P.S. Maner, District Patna .... .... Opposite Party ====================================================== With Civil Revision No.3 of 2013 ====================================================== 1. The State of Bihar through the Principal Secretary Road Construction Department , Bihar, Patna 2. The Engineer-in-Chief, Road, Construction Department, Bihar, Patna. 3. The Chief Engineer, South Bihar Wing, Road Construction Department, Bihar, Patna. 4. The Superintending Engineer, Bhojpur Road Circle, Ara. 5. The Executive Engineer, Sahabad Road Division, Ara. .... .... Petitioner/s Versus M/S Bansidhar Construction Pvt. Ltd. at Patila, Maner, Patna through its Director, Ram Prasad Roay son of late Kisun Dayal Road, resident of village Patila, P.S. Maner, District Patna .... .... Opposite Party ====================================================== Appearance : (In C.R. No.2 of 2013) For the Petitioner/s : Mr. Sudhir Kumar, Adv. For the Respondent/s : (In C.R. No.3 of 2013) For the Petitioner/s : Mr. Sudhir Kumar, Adv. For the Respondent/s : ====================================================== CORAM: HONOURABLE MR. JUSTICE JYOTI SARAN ORAL ORDER 6 05-04-2013 As the orders passed in the two civil revision applications are interlinked hence they have been taken together with a view to 2
Legal Reasoning
Patna High Court C.R. No.2 of 2013 (6) dt.05-04-2013 2 / 12 its final disposal. Whereas C.R. No.2 of 2013 seeks to question the order dated 16.12.2011 passed in Review Case No. 4 of 2011 by the Bihar State Works Contract Dispute Arbitration Tribunal constituted under the provisions of Bihar Public Works Contract Disputes Arbitration Tribunal Act, 2008 whereby the learned Tribunal has been pleased to dismiss the application filed by the petitioner seeking review of the award dated 13.4.2011 passed in Reference Case No. 38 of 2010, C.R. No. 3 of 2013 questions the award dated 13.4.2011 passed by the learned Tribunal in Reference case No. 38 of 2010 whereby the learned Tribunal has found the claimant-opposite party entitled for payment of the escalation amount of Rs. 31,37,288/- from 24.3.2008 and to a further amount of Rs. 36,19,129/- with effect from 1.4.2009 together with interest at the rate of 10% per annum on each of the two amounts to be calculated with effect from 14.12.2009 until realization. For the sake of convenience I shall be referring to the pleadings and annexures in C.R.No.3 of 2013 unless specified with reference to the other application. Facts of the case in brief is that pursuant to a tender notice issued by the petitioners for strengthening and widening of the 3 Patna High Court C.R. No.2 of 2013 (6) dt.05-04-2013 3 / 12 Ara-Ekauna-Khaira-Sahar Road in between kilometers 19 to 35, the opposite party submitted his tender and which was accepted. An agreement was entered into between the parties at value of Rs. 12,35,93,460/- vide Agreement No.21/SBD dated 5.2.2008 of 2007-08. In terms of the agreement the work was to commence on 12.2.2008 and was to be completed within a period of 18 months i.e. on 11.8.2009. According to the petitioner, as the opposite party failed to complete the work within the work schedule hence after service of notice of show cause, and on his failure to respond to the same, the opposite party was debarred from taking part in any further tender to be issued by the Road Construction Department and which was communicated to him vide letter No. 487 dated 17.4.2009. The opposite party thereafter appeared and agreed to complete the work under a revised work programme submitted by him together with an affidavit but failed to do so. Ultimately, the agreement was rescinded by the Executive Engineer, Sahabad Road Division, Ara vide letter No. 1810 dated 10.12.2009 under Clause 3 of the (Conditions of Contract) Special Bidding Document (SBD for sake of brevity), a copy whereof has been placed vide Annexure-5 to the supplementary affidavit. It is stated at the bar that the opposite party has questioned 4 Patna High Court C.R. No.2 of 2013 (6) dt.05-04-2013 4 / 12 the order dated 10.12.2009 before the Tribunal through a separate proceeding. In so far as the issue involved in the present proceeding is concerned, suffice it to say that a claim was raised by the opposite party invoking Clause 10C of the Special Bidding document (Annexure-5) by filing a writ application in this Court giving rise to C.W.J.C. No. 17309 of 2009 and which writ application was disposed of on 14.12.2009 by this Court with liberty to move the competent authority who was required to decide the same. Upon representation being filed by the opposite party, his claim was rejected by the Executive Engineer, Sahabad Road Division, Ara vide memo No. 123 dated 22.1.2010. Feeling aggrieved, the reference case in question was filed by the opposite party before the Tribunal giving rise to Reference Case No. 38 of 2010 under Section 9 of the Act questioning the order bearing memo No. 123 dated 22.1.2010 whereby his claim under Clause 10C was rejected. The learned Tribunal after hearing the parties by the award impugned in C.R. No. 3 of 2013 dated 13.4.2011, has allowed the claim. The learned Tribunal while pronouncing the award has modified the claim raised by the opposite party finding him entitled to an escalation amount of Rs. 31,37,288/- for the increased revised rate from the period 24.3.2008 and to an amount of Rs. 36,19,129/- with effect from 5 Patna High Court C.R. No.2 of 2013 (6) dt.05-04-2013 5 / 12 1.4.2009. The Tribunal while allowing the claims has also awarded simple interest at the rate of 10% per annum payable with effect from 14.12.2008 until its realization.
Legal Reasoning
I have heard Mr. Sudhir Kumar, learned A.C. to AAG 2 appearing for the petitioners in both the civil revision applications and have perused the records. The only issue raised by the petitioner before the Tribunal and has been canvassed before this Court is that a claim under Clause 10C of the Special Bidding Document (Annexure-5) had certain pre-requisites to be fulfilled before the same could be accepted and the opposite party having failed to comply with those requirements, his claim was not tenable and the Tribunal has misdirected itself into looking into such claim in spite of non- fulfillment of these conditions by the opposite party. The consideration before this Court is whether or not the claim of the opposite party was in tune with the provisions of Section 10C of the agreement and whether the Tribunal has committed any error while allowing the claims despite non- fulfillment of the conditions stipulated under Clause 10 C as claimed by the petitioners before this Court. Clause 10C of the S.B.D (Conditions of Contract) present at Annexure-5 reads as under. 6 Patna High Court C.R. No.2 of 2013 (6) dt.05-04-2013 6 / 12 Payment on Account of in increase Prices/Wage s to due Statutory Order(s) in in the the stores time of incorporated “CLAUSE 10 C If after submission of the tender the price the of any material works(not being a material supplied from the Engineer-in-Charge‟s in accordance with clause 10 thereof) and/or wages of labour increases as a direct result of the coming into force any fresh law, or statutory rule or order (but not due to any changes in sales tax) and such increase the price and/or wages last prevailing at stipulated date for receipt of the tenders including extensions if any for the work, and the contractor thereupon necessarily and properly pays in respect of that material (incorporated in the works) such in respect of increased price and/or labour engaged on the execution of the work such increased wages, then the amount of the contract shall accordingly be varied and provided further that any such increase shall not be payable if such increase has become operative after the stipulated date of completion of the work in question. If after submission of the tender, the price of any material incorporated in the works (not being a material supplied from the in Engineer-in-Charge‟s accordance with clause 10 thereof) and /or wages of labour is decreased as a direct result of the coming not force of any law or statutory rules or order(but not due to any changes in sales tax) and such decrease in the prices and/or wages prevailing at the time of receipt of the tender for the work. The government shall in respect of materials incorporated (not being materials in the works stores 7 Patna High Court C.R. No.2 of 2013 (6) dt.05-04-2013 7 / 12 supplied from the Engineer-in-Charge‟s stores in accordance with Clause-10 hereof) and/or labour engaged on the execution of the work after the date of coming into force of such law statutory rule or order be entitled to deduct from the dues of the contractor such amount as shall be equivalent to the difference between the prices of the materials and/or wages as prevailed at the time of the last stipulated date for receipt of tenders including extensions if any for the work and the price of materials and/or wages of labour on the coming into force of such law, statutory rule or order. The Contractor shall, for purpose of this condition, keep such books of account and other documents as are necessary to show the amount of any increase claimed or reduction available and shall allow the same by a duly inspection of the representative authorized Government, and further shall, at the request of the Engineer-in-Charge may require any documents so kept and such other information as the Engineer-in- Charge may require. The contractor shall, within a reasonable time of his becoming aware of any alteration the price of any such material and/or wages of labour, give notice thereof to the Engineer-in-Charge stating that the same is given pursuant to all this information relating thereto which be may be in position to supply.” together with condition of in The said stipulation nowhere requires the claimant to submit any books of account in support of his claim for escalation amount rather merely obliges the claimant to keep such books of account 8 Patna High Court C.R. No.2 of 2013 (6) dt.05-04-2013 8 / 12 and other documents as would be necessary, to show the amount of any increase claimed or reduction available and shall allow inspection of the same by duly authorized representative of the Government and shall at the request of the Engineer-in-Chief may require any document so kept and as such information as he may require. Whereas it is the stand of the Executive Engineer before the Tribunal and before this Court that the opposite party never submitted any books of account, the stand of the opposite party was that the same had been submitted on 26.10.2009 along with a representation. Three objections were raised by the petitioners before the Tribunal namely: that the opposite party had failed to produce the books; that the claim was received after 18 months of the escalated cost of materials and wages and that the agreement itself stood rescinded on 10.12.2009. Perusal of the award impugned manifests that the claim under Clause 10C of the Conditions of Contract (Annexure-5) was raised by the opposite party firstly on 19.4.2009 and which was duly forwarded by the Executive Engineer on 27.7.2009 together with the recommendation of the Assistant Engineer dated 20.7.2009 to the Superintending Engineer. The Tribunal has taken note of the fact that the representation filed by the opposite party was accompanied with 9 Patna High Court C.R. No.2 of 2013 (6) dt.05-04-2013 9 / 12 the on account bills containing the escalated price of materials and wages. As no response was coming forth the opposite party moved before this Court through C.W.J.C. No. 17309 of 2009 for
Decision
settlement of his claim and which writ application was disposed of with a direction to the petitioners herein to consider and dispose of his claim as raised in his representation. A letter no. 1881 dated 21.12.2009 of the Executive Engineer addressed to the Superintending Engineer has been taken note of by the Tribunal in which the Executive Engineer had mentioned that he would be sending details in terms of the Clause 10C of the SBD. It is in the backdrop of the above circumstances that the Tribunal came to a conclusion that the plea of non-furnishing of books of accounts by the opposite party was mere of a pretext to reject the claim and that the necessary information was well within the possession of the petitioners. The copy of such bills had been produced before the Tribunal and the genuineness thereof was never questioned by the petitioners before the Tribunal. It is in the said circumstances that the Tribunal was of the opinion that the petitioners were not justified in negating the claim of the petitioner. However, even while accepting the claim, the Tribunal taking into consideration that the contract itself stood rescinded on 10.12.2009, the claim raised under Clause 10C was modified accordingly. A detailed 10 Patna High Court C.R. No.2 of 2013 (6) dt.05-04-2013 10 / 12 calculation of the claim for the escalation amount was placed before the Tribunal under the joint signature of the Junior Engineer, Assistant Engineer and the Executive Engineer and the Tribunal found that the calculation so made by the department was much higher than the claim raised by the opposite party herein. Taking note of the circumstances, that the claim raised by the claimant was lower than the calculation of the department, the same was allowed and the award was passed in the following terms; “Award:- In the result the Award is here by passed as under:- 1. The respondents shall pay to the petitioner the increased revised rate with effect from 24.03.2008 under clause 10C of conditions of contract towards escalation, sum total, being an amount of 31,37,288/- (Rupees Thirty One laks thirty seven thousand two hundred eighty eight only) 2. The respondents shall further pay to the petitioner the increased revised rate with effect from 01.04.2009 under clause 10c towards escalation, sum total being on amount of Rs. 36,19,129/- (Rupees Thirty six laks nineteen thousand one hundred twenty nine only). 3. The respondents shall pay simple interest @ 10% per annum on both the amounts with effect from 14.12.2009 till realisation. 4. Under the circumstances of the case the parties shall bear their respective costs” The award passed by the Tribunal is having regard to the undisputed materials on record and in the light of the stipulations set out in Clause 10C of the S.B.D.(Conditions of Contract) which binds both parties. 11 Patna High Court C.R. No.2 of 2013 (6) dt.05-04-2013 11 / 12 As I have already observed hereinbefore, the books of accounts were never required to be submitted by the claimant along with his claim except on such desire expressed by the Engineer-in-Chief. There is nothing on record or in the award in question which demonstrates that any such desire was expressed by the Engineer-in-Chief and in that view of the matter all that was required was verification of the accounts maintained by the claimant for consideration/approval/reduction of his claim, which was undisputedly produced by the opposite party herein and the genuineness whereof, was never doubted nor questioned before the Tribunal. In the said circumstance the objection taken by the petitioners before the Tribunal to contest the claim i.e non production of the books accounts can not only be termed as „unwarranted‟ rather is a mere pretext to reject the claim especially where the books of accounts so produced before the Tribunal were never doubted by the department rather the calculation so made by the department overshot the claim raised by opposite party herein. The circumstances are sufficient to suggest that the award in question is perfectly in order and warrants no interference. As there is no error apparent on the fact of record, the review application was rightly rejected and which order again calls 12 Patna High Court C.R. No.2 of 2013 (6) dt.05-04-2013 12 / 12 for no interference. For the reasons aforesaid, these two civil revision applications are dismissed. Bibhash/- (Jyoti Saran, J)