High Court · 2012

This appeal by the plaintiff is directed against the judgment and decree dated 7th August, 2000 passed by the learned Additional District Judge at Dibru garh in Money Suit No.4/1996, partly decreeing the suit of the plaintiff in resp ect of Rs.2,20,618/- with interest @ 18% per annum from the date of the decree t ill the date of realization. [2] The appellant as plaintiff instituted Money Suit No.40/1989 in t he Court of the learned Assistant District Judge, Dibrugarh against the present respondents as defendants claiming a decree for Rs.1,17,17,636/- with future int erest @ 18% per annum from the date of filing the suit till the date of realizat ion, contending inter alia that though pursuant to the contract work No.CCo/CIV/ 3933 (Exhibit-4) (hereinafter referred to as the (cid:28)first work (cid:29)), dated 13th June , 1985 for construction of graveled approach road and plinth including road over plinth for three numbers of drilling location sites at Kharsang in the district of Tirap, Arunachal Pradesh, the plaintiff successfully completed the work to t he full satisfaction of the defendant No.1 and within the stipulated time, an am ount of Rs.4,03,127/- still due and payable. It has also been pleaded in the pl aint that apart from the said work, another contract work No.CCO/CIV/5504 (herei nafter referred to as the (cid:28)second work (cid:29)) dated 9th February, 1988 was executed b etween the parties awarding the contract in favour of the plaintiff for providin g premixed bituminous concrete surface over the graveled approach road of locati on of ’HEN’ for 3.52 Kms. at Tengapani Tea Estate area, pursuant to which though the plaintiff started the work and completed to a substantial extent upto 1.260 Kms., the said contract has illegally been terminated by the defendant No.1 vid e order dated 10th November, 1988. The plaintiff in respect of the second work has claimed a decree for Rs.1,04,50,000/- under 3(three) heads, namely- (i) paym ent for the works done; (ii) the loss sustained by it due to the damage of the m aterials stored in the site of the work; and (iii) compensation of Rs.1 Crore fo r loss of the goodwill of the plaintiff Firm for the illegal and unlawful termin ation of the contract. It has also been pleaded that the plaintiff is also enti tled to refund of the security deposit of Rs.47,000/-, made in respect of the af oresaid two works. [3] The defendants on receipt of the summons entered appearance and filed their joint written statement denying the claim of the plaintiff, contendi ng inter alia that though the first work was allotted, which the plaintiff was r equired to complete by 31st May, 1988, the plaintiff abandoned the work after ex ecution to some extent, on 8th June, 1988. It has further been pleaded that the work, which has been completed was also not satisfactory. The further pleaded case of the defendants was that because of the failure of the plaintiff to compl ete the work, the defendant had no alternative but to terminate the contract. T he defendants in the written statement further contended that after the plaintif f abandoned the job, a joint measurement was done by the plaintiff and the defen dant, wherein it was found that the plaintiff executed the first work to the ext ent of Rs.6,52,474.91/- and accordingly, the certificate of payment dated 28th N ovember, 1988 was prepared in presence of the plaintiff’s representative. Accor ding to the defendants, out of the said amount, an amount of Rs.4,72,728.41 has already been paid to the plaintiff on different dates, which the plaintiff ackno wledged and an amount of Rs.26,619.50 has been retained by the defendants for as certaining the liquidated damage as well as penalty. According to the defendant s, the plaintiff, therefore, was offered the balance amount of Rs.1,53,127/-, wh ich the plaintiff never collected from the defendants. In respect of the first work, the defendant has further pleaded that though an amount of Rs.26,619.50 wa s kept withheld for ascertaining the liquidated damage and penalty recoverable f rom the defendants, the defendant subsequently assessed the liquidated damage as Rs.1,385.33 and penalty as Rs.19,978.59 totaling Rs.21,363.92 out of the withhe ld amount of Rs.26,619.50 and as such, the plaintiff is also entitled to a furth er sum of Rs.5,442.22 totaling Rs.1,58,589.22. [4] Relating to the second work, namely Contract No.CCO/CIV/5504 dat ed 9th February, 1988, the defendants have pleaded in the written statement that pursuant to the work allotted for providing the premixed bituminous concrete su rface over 3.52 Kms. approached road, the plaintiff could complete the work for 1.095 Kms. only and not 1.260 Kms. as claimed by the plaintiff, though the plain tiff, as per the contract was required to complete the same by 31st May, 1988. According to the defendants, the plaintiff on 25th June, 1988 completely stopped the work after completing 1.095 Kms. stretch of the road for which and having r egard to the urgency of the work, the said contract was terminated, which was su bsequently completed through another contractor, as the plaintiff despite repeat ed warnings issued did not restart and complete the work. According to the defe ndants, the plaintiff has done the work worth Rs.72,060.00/- in respect of the s econd work, out of which an amount of Rs.57,031.02 is recoverable from the plain tiff on account of the liquidated damage of Rs.31,583.00 and penalty of Rs.16,96 8.00 and the cost of bitumen supplied to the plaintiff amounting to Rs.8,480.00 and thus an amount of Rs.15,028.98 is only due and payable to the plaintiff agai nst the second contract. The said suit was subsequently transferred to the Court of the learned Additiona l District Judge, Dibrugarh, whereafter it was registered and numbered as Money Suit No.4/1996. [5] med the following issues for determination:- The Trial Court on the basis of the pleadings of the parties fra (cid:28)1.

3. Is the suit is maintainable in its present form? Has the plaintiff right to sue? Is there any cause of action for the suit?

4. of the contract? Is the plaintiff liable to pay liquidated damage and penalties in terms

6. Whether the defendant No.1 terminated the contract illegally? To what reliefs are the parties entitled? (cid:29) [6] The plaintiff in support of its claim has examined one witness, namely Shri R.K. Sukla, Power of Attorney holder to the plaintiff Firm as PW-1 a nd proved a number of documents including the contracts between the parties. Th e defendants in support of their pleadings have also examined 2(two) witnesses, namely Shri Kuladhar Deka (DW-1), Superintending Engineer of the defendant No.1 Company and Shri Akshay Kr. Thakuria, who was the in-charge of the second work a s DW-2. The defendants have also proved a number of documents, which includes t he contracts between the parties as well as the termination order, apart from va rious communications exchanged between the parties. The witnesses were duly cros s-examined by the respective parties. The learned Additional District Judge upon appreciation of the e [7] vidences on record, both oral and documentary, partly decreed the suit of the pl aintiffs vide judgment and decree dated 7th August, 2000, by answering the issue Nos.1, 2 and 3 in favour of the plaintiff and issue Nos.4, 5 and 6 also party i n favour of the plaintiff. Neither any appeal nor any cross-objection has been filed by the defendants challenging the decree passed by the Trial Court. [8] I have heard Mr. P. Deka, learned counsel for the appellant/ pla intiff. None appears for the defendants/respondents though the name of the lear ned counsel appearing for the respondents/defendants is reflected in the cause l ist. [9] Referring to the decision of the learned Judge against issue Nos .4 to 6, it has been contended by the learned counsel for the appellant that it is evident from the evidences adduced by the parties including the terms of the contracts between the parties, in respect of the first as well as the second wor ks, that though there was stipulation relating to the time for completion of the work, the time as such is not the essence of the contract, in view of the stipu lation in the contracts for extension of the time and imposition of penalty and the liquidated damages in the event of failure to execute the work within time. The learned counsel, therefore, submits that the Trial Court at least ought to have decreed the amount, which has been withheld from payment to the plaintiff, towards liquidated damage and penalty, in respect of the first work. Referring to the second work, it has been submitted by the learned counsel that there bein g unchallenged evidences on record relating to the damage suffered by the plaint iff in respect of the materials collected for completion of the work as well as the loss of goodwill of the plaintiff Firm, the Trial Court ought to have decree d the suit of the plaintiff in respect of the amount claimed against the second work, when the termination of the contract is illegal. [10] The learned Judge while partly decreeing the suit of the plainti ff vide judgment dated 7th August, 2000 answered the issue Nos.1 to 3 in favour of the plaintiff. The issue Nos.4 to 6, as noticed above, have also been answer ed in favour of the plaintiff but partly. As noticed above, neither any appeal nor any cross-objection has been filed by the defendants challenging the decree passed by the Trial Court. Hence, the first appellate Court is not called upon to go into the legality and validity of the finding recorded by the Trial Court against issue Nos.1 to 3. This appeal, therefore, confines to the validity of t he findings recorded in favour of the issue Nos.4 to 6, in so far as it relates to the refusal to pass a decree as claimed by the plaintiff. According to the a ppellant/plaintiff, such finding is not based on the evidences on record. [11] I have perused the pleadings of the parties as well as the evide nces, both oral and documentary, adduced by the parties in the aforesaid suit. Though the plaintiff in the plaint has claimed that it has successfully complete d the first work to the satisfaction of all concerned, the plaintiff’s own witne ss PW-1 in his deposition has admitted that the plaintiff has completed the work worth only about 6.5 Lakhs, out of which an amount of Rs.4,03,127/- has been pa id by the defendants to the plaintiff. The total value of the first work was Rs .13,60,730.50. The plaintiff also could not adduce any evidence to demonstrate that the said work was successfully completed. On the other hand, the defendant s proved the certificate of payment (Exhibit-D), wherefrom it appears that the p laintiff has completed the work worth Rs.6,52,474.91. It also appears from the said document that an amount of Rs.26,619.50 has been retained by the defendant for ascertaining the liquidated damage and penalty for non completion of the wor k by the plaintiff and an amount of Rs.1,53,127.00 is payable against the first work, as an amount of Rs.4,72,728.41 has already been paid to the plaintiff. Th e said position has been accepted by the plaintiff as the same was prepared and acknowledged by the representative of the plaintiff on 4th January, 1988 with th e stipulation that only the aforesaid amount of Rs.1,53,127/- is due and payable against the first work. The defendants have also proved the measurement book ( Exhibit-T) reflecting the measurement of the work done by the plaintiff against the first work. The defendants have also admitted in their pleadings in the wri tten statement that though an amount of Rs.26,619.50 was retained for ascertaini ng the liquidated damage and penalty payable by the plaintiff, the same was asce rtained at Rs.21,364.12 and as such, the plaintiff is entitled to the sum of Rs. 5442.22 in addition to the amount of Rs.153,127.00, totaling Rs.1,58,569.22. [12] One of the conditions of the contract between the parties, in re spect of the first work was that the plaintiff is liable to pay the liquidated d amage and penalty in case of failure to complete the work within the stipulated period of time. As discussed above, the plaintiff has abandon the work half don e and did not complete the same despite repeated reminders issued by the authori ty. The stand taken by the plaintiff in the plaint that the work has been compl eted, is found to be not correct from the evidences adduced by the parties. In terms of such provisions for the liability for liquidated damage and the penalty , in the contract between the parties, the defendants were within their right to recover the same from the plaintiff. That being the position, the plaintiff is not entitled to any further amount other than the amount of Rs.1,58,569.22, whi ch has already been decreed by the trial Court against the first work contract. [13] Relating to the second work contract, as noticed above, the plai ntiff’s claim is under 3(three) heads, namely (i) the value of the work done; (i i) the loss caused to the plaintiff for damage of the materials collected and (i ii) the loss of good will. The plaintiff except making the self serving stateme nt in the plaint as well as by the PW-1 in the deposition that it has completed the work upto 1.260 Km., it has not adduced any other documentary evidence in su pport of such claim. On the other hand, by proving the measurement book, the de fendants could prove that the plaintiff has completed the work for 1.095 Kms., v alue of which has been assessed as Rs.72,060.00. The plaintiff also could not c omplete the work despite the various reminders issued and as such, the contract has to be terminated by the defendants vide order dated 10th November, 1988 (Exh ibit-F), in terms of the stipulation in the contract. Out of the said amount of Rs.72,060.00, an amount of Rs.57,031.02 was deducted by the defendants towards t he liquidated damage of Rs.31,583.00, penalty of Rs.16,968.00 and the costs of t he bitumen supplied to the plaintiff by the defendant, i.e. Rs.8,480.00. Having deducted the said amount, an amount of Rs.15,028.98/-, according to the defenda nts themselves, was payable to the plaintiff. Like in the first work contract, the plaintiff agreed for payment of the liquidated damage and penalty in case of failure to complete the work within the stipulated period of time or extended t ime. The defendants could prove by Exhibits-G, H and J that despite the various notices issued, the plaintiff did not resume the work and abandoned the work af ter completion upto 1.095 Kms. As despite issuance of the aforesaid communicatio ns, the plaintiff did not resume and complete the work, the defendants have righ tly terminated the contract (second work) vide order dated 10th November, 1988. The plaintiff is, therefore, not entitled to any compensation for termination o f the work. That apart, though the plaintiff has claimed that there was loss of goodwill of the plaintiff Firm, no evidence whatsoever has been led by the plai ntiff in this respect. No evidence relating to collection of materials and the damaged caused to such material has also been led. [14] The learned Judge has also passed a decree for Rs.47,000/- being the security deposit made by the plaintiff, though it is evident from the evide nces adduced that the security of Rs.27,215/- was only made in respect of the fi rst work only and there was no security deposit by the plaintiff in respect of t he second work as the plaintiff Firm has, in the meantime, been registered and t he registered Firm was not required to make any security deposit. Be that as it may, since the said decree has not been put to challenge by the defendants, I a m not interring with the decree as passed by the Trial Court. [15] In view of the above, I do not find any merit to pass a further decree in favour of the plaintiff beyond the amount decreed by the Trial Court a nd hence, the appeal stands dismissed. The Parties are, however, directed to be ar their own costs. [16] The Registry is directed to send down the records forthwith.