Gujarat High Court
Guj Housing Board vs United Consturction Co on 4 October, 2023
Author: Umesh A. Trivedi
Bench: Umesh A. Trivedi
NEUTRAL CITATION
C/FA/1805/1994 JUDGMENT DATED: 04/10/2023
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 1805 of 1994
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE UMESH A. TRIVEDI
and
HONOURABLE MRS. JUSTICE M. K. THAKKER
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1 Whether Reporters of Local Papers may be
allowed to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair
copy of the judgment ?
4 Whether this case involves a substantial
question of law as to the interpretation of the
Constitution of India or any order made
thereunder ?
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GUJ HOUSING BOARD
Versus
UNITED CONSTURCTION CO & 5 other(s)
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Appearance:
MRS KRISHNA G RAWAL(1315) for the Appellant(s) No. 1
MR KG SUKHWANI(871) for the Defendant(s) No. 1
NOTICE SERVED for the Defendant(s) No. 2,5
NOTICE UNSERVED for the Defendant(s) No. 3
SERVED BY AFFIX(N) for the Defendant(s) No. 6
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CORAM:HONOURABLE MR. JUSTICE UMESH A. TRIVEDI
and
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NEUTRAL CITATION
C/FA/1805/1994 JUDGMENT DATED: 04/10/2023
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HONOURABLE MRS. JUSTICE M. K. THAKKER
Date : 04/10/2023
ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE UMESH A. TRIVEDI) [1.0] This Appeal is filed under Section 96 of the Code of Civil Procedure, 1908 challenging the judgment and decree passed by the Judge, Court No.10, City Civil Court, Ahmedabad dated 20.09.1993 in Civil Suit No.2651 of 1982 whereby the suit filed by the appellant - Gujarat Housing Board was dismissed for recovery of an amount of Rs.17,54,659.32 against the respondents - defendants.
[2.0] The appellant herein is the original plaintiff whereas respondents are the original defendant nos.1 to 6 in suit. Hence, hereinafter they would be referred in this judgment as their status in the suit as plaintiff and defendants.
[3.0] The short facts of the case are as under:
[3.1] The plaintiff is a body corporate established under the Gujarat Housing Board Act, 1961 (hereinafter referred to as 'the Act'). Defendant No. 1 is a partnership firm whereas defendant Nos. 2 to 6 are its partners. Defendant No. 7 is Canara Bank who gave guarantee on behalf of defendant No. 1 and executed a Guarantee Bond dated 06.06.1979 in favour of the plaintiff to the extent of Rs.47,920/-. Vide plaintiff's purshis at Exh.60, the plaintiff has received the amount of bank guarantee of Rs. 47,920/- and accordingly defendant No. 7 -Page 2 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023
NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined bank has been deleted on 23.12.1991.
[3.2] According to the plaintiff, for construction of 284 L.I.G. housing tenements at Gotri, Baroda, tenders were invited at the estimated cost of Rs.23,95,753/-. Defendant No. 1- partnership firm filed its tender along with other contractors. The tender of defendant No.1 was accepted by the competent authority at Ahmedabad at 9.49% above the estimated cost namely for Rs. 26,23,109.96 ps. Intimation to this effect was sent to defendant No.1 on 30.05.1979. The time-limit for completion of work was fixed at 18 months. Defendant No.1 executed contract agreement No. B-1/3 of 1979-80 at Ahmedabad. Vide letter dated 19.06.1979, the work order to start the work from 25.06.1979 was given to defendant No. 1 - contractor with a direction to complete the work within 18 months i.e. on or before 24.12.1980.
[3.3] According to the plaintiff, vide letters dated 12.03.1980, 21.08.1980, and 22.10.1980, defendant No. 1 was informed about the slow progress of work. During this period, the progress of work was hardly 5% proportion of time. Vide letters dated 21.07.1980, 21.08.1980 and 27.08.1980, defendant No. 1 contractor was informed to construct a cement godown as per the tender condition, but it failed to do so. From October, 1979 to December, 1930, 2798 cement bags were supplied to defendant No.1 - contractor. The said cement was not consumed and several bags were found unconsumed at the end of every month. Defendant No.1 has carried out work for an amount Rs.1,00,673/- only. The progress of work Page 3 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined done did not suffer for short supply of cement. From June 1980, defendant No. 1 was in possession of large quantity of cement. However, it has not carried out any construction work with an intention to commit breach of the contract. Under the circumstances, as per Clause 2 of the agreement, the plaintiff levied compensation at the rate of Rs.1,350/- per day from 22.10.1980 to 31.12.1980, which comes to Rs. 97,200/-.
[3.4] According to the plaintiff, defendant No. 1 committed breach of the contract and abandoned the work and carried out the work only for an amount of Rs 1,00,678/- within the stipulated time, and therefore, action under Clause 3 of the agreement was taken against defendant No. 1 firm to get the incomplete work completed at its risk and cost at the estimated cost of Rs. 22,95,075/- and the said work was entrusted to M/s. Western Bharat Construction Co. at the cost of Rs. 39,93,430.50 ps, which is 74% above the estimated cost by inviting public tenders. Accordingly the plaintiff was required to pay an additional amount of Rs. 15,26,374.04 ps to M/s. Western Bharat Construction Co. and in turn, it is entitled to recover the aforesaid amount towards damages from defendant No. 1 - contractor.
[3.5] On service of summons to the defendants, they appeared before the Court and defendant nos.1, 2 and 5 have filed their joint written statement at Exh.38 whereas defendant nos.3, 4 and 6 have filed their written statement at Exh.35. After the written statements were filed, the plaintiff submitted an application for amendment of the plaint, which came to be Page 4 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined allowed. Pursuant thereto, defendant nos.1, 3 and 5 filed their amended written statement at Exh.106. Though written statements at Exh.38 and 106 are verbatim the same, except some addition in written statement, Exh.106 in response to the amended plaint nothing new is stated in it.
[3.6] Defendant Nos. 1, 3 and 5 have contended that this Court has no jurisdiction to try and hear the present suit. The plaintiff's suit is time-barred. The plaint does not disclose any cause of action as the authority appointed under Section/ Clause 30 of the agreement has not heard and decided the matter, and therefore, the condition precedent is not followed by the plaintiff. The suit is not signed by the competent authority and the signatory is not empowered to sign the plaint as there is no such delegation. The suit contract is not executed in accordance with the provisions of Section 21 of 'the Act', and therefore, the said contract is not valid and not binding. Under the circumstances, when the contract itself is void, no party has a right to rely upon such a contract. The defendants have denied that vide various letters, the plaintiff informed them about the slow progress of the work and to accelerate the progress of the work. It has been denied that defendant No.1 was informed vide various letters to construct cement godown according to the tender condition. It is also denied that many cement bags were found unconsumed as mentioned in the plaint with defendant No. 1- contractor. The work was carried out by defendant No.1- contractor under the supervision of the Engineers on the site as per the designs, drawings, specifications and oral instructions as given by the Page 5 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined plaintiff's Officers. As per Clause 13 of the agreement, the plaintiff was required to give certified copy of the tender and three sets of working drawing along with the work order. But the plaintiff failed to do so. The plaintiff was not in a position to supply the materials as per Schedule 'A' namely, cement and steel. Under the circumstances, the plaintiff had committed a breach of contract by not supplying the plans along with the work order and cement and steel as per Schedule 'A'. The completion of work depended upon the reciprocal performance on the part of the plaintiff. The said reciprocal performance on the part of the plaintiff failed, and therefore, they committed breach of contract. In the aforesaid circumstances, defendant No. 1 had a right to abandon the work and ask for the damages and security deposit and the price of the work done by them.
[3.7] According to the defendants, the levy of penalty at the rate of Rs.1,350/- is illegal. There was no termination of the contract as per Clause 2. Therefore, there was no question of penalty. The plaintiff is not entitled to recover the damages. As a matter of fact, defendant Nos, 1 to 6 are entitled to recover a sum of Rs.10,22,920-/- from the plaintiff for which a separate Civil Suit bearing No. 3977 of 1982 is pending in this Court. The plaintiff has no right to seize the materials brought on site. The plaintiff wrongly terminated the contract. It is denied that the plaintiff is entitled to recover Ra. 30,950/- from the defendants. The plaintiff is not entitled to claim Rs. 97,200/- towards compensation at the rate of Rs. 1,350/- per day and Rs. 1,48,055.29 ps. as supervision charges.
Page 6 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined [3.8] Defendant Nos.3, 4, 6 have contended in their written statement at Exh.35 that they are not the partners of defendant No.1 firm. They retired from the partnership firm with effect from 01.07.1978 vide Dissolution Deed dated 30.06.1978 executed among the partners of defendant No. 1 firm. After their retirement, defendant No.1 firm was taken over by defendant Nos .2 & 5. Hence, defendant nos.3, 4 and 6 prayed in the suit that the plaintiff's suit deserves to be dismissed against them with costs.
[3.9] On the basis of the pleadings of the parties, the Court framed the issues as under:
(1) Whether the plaintiff - Gujarat Housing Board proves that defendants have committed breach of the suit contract?
(2) Whether the plaintiff is entitled to an amount of Rs.18,02,579.32 ps as stated in paragraph 16 of the plaint?
(3) Whether the defendants prove that this Court has no jurisdiction to try the suit?
(3-A) Whether defendant Nos.1, 3 and 5 prove that the suit is not maintainable in view of contentions raised in paragraph 5(a) of the written statement?
(4) Whether the defendants prove that the plaintiff's suit is time barred?
(5) Whether defendant Nos.1, 2 and 5 prove that on account Page 7 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined of non-reciprocal performance on the part of the plaintiff, defendants were exonerated from contractual obligations as contended in paragraph 27 of the written statement?
(6) Whether defendant Nos.3, 4 and 6 prove that as they have retired from the defendant no.1 partnership firm on and from 01.07.1978, they are not liable for the suit dues as contended in paragraph 11 of their written statement?
(7) What order and decree? [3.9] Though several issues were framed by the Court, in
view of defence raised by the defendants in paragraph 5(a) of their amended written statement Exh.106 filed by defendant Nos.1,3 and 5 claiming that the suit contract having not been executed in accordance with the provisions of Sections 21 and 23 of 'the Act', it is not a valid contract and not binding, and therefore, Issue No.3-A was framed to the effect whether defendant Nos.1, 3 and 5 prove that the suit is not maintainable in view of the contentions raised in the aforesaid written statement. The answer to the said issue is given by the Court in affirmative.
[3.10] The trial Judge while answering Issue No.3-A, as aforesaid, concluded that the suit contract Exh.115 is signed by the Executive Engineer of the plaintiff - Board and it does not contain the signature of the Chairman of the plaintiff - Board and quoted Sections 21 and 23 of 'the Act'. The learned Judge has held that overall reading of Section 21 reveals that it Page 8 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined is a mandatory provision whereby contract is required to be signed by the Chairman of the Housing Board alone.
Section 23 of 'the Act' reads as under:
"23. Further provisions as to execution of contracts: (1) Every contract by the Chairman on behalf of the Board shall, subject to the provisions of this Section, be entered into in such manner and form as may be prescribed.
(2) A contract not executed as provided in this Section and the Rules made thereunder shall not be binding on the Board."
[3.11] It is held that if any agreement is not signed as per the provisions of Section 21, no such agreement shall be binding on the Board.
[3.12] In paragraph 18 of the impugned judgment, it is concluded by the learned Judge that the original agreement is signed by the plaintiff's Executive Engineer and on behalf of defendant no.1 firm by its partner on 15.06.1979. As held by the learned Judge, the said agreement does not bear the common seal of the plaintiff - Board. The last sentence of the said agreement in Gujarati is quoted by the learned Judge to support his conclusion that it is signed by the Executive Engineer as per the order of Chairman of the Housing Board. It is further held that even as per Section 22 of 'the Act' powers under Section 21 of 'the Act' can be exercised by Page 9 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined Housing Commissioner or any other Officer specified by it in the order of delegation. The learned Judge has further held that the agreement is not signed by the Housing Commissioner. It is further held that the Executive Engineer has also not produced any such delegation to permit him to sign such agreement with defendant No.1 firm, and therefore, it is concluded that the Executive Engineer was not competent to sign any agreement of defendant No.1, which would bind both the parties for enforcement of the contract. As a consequence thereof, it is held that any agreement by a person incompetent to enter into, it is void ab initio, and therefore, it concluded that the plaintiff - Board cannot enforce the terms and conditions of that contract by filing a suit against the defendants. According to the learned Judge, the plaintiff - Board has claimed various amounts arising out of Clauses 2, 3 and 53 of the terms and conditions of the said agreement, which are part and parcel of the papers of the file at Exh.115, which includes the original agreement, and therefore, in paragraph 20 it concluded that the plaintiff - Board has no right to file the suit on the basis of the alleged agreement, which is void ab initio and neither of the parties to the said agreement can rely upon it for the purpose of the suit and issue No.3-A was answered in affirmative. Therefore, instead of answering the suit on all the issues framed, though there is some discussion about the evidence led before the Court, ultimately all the issues were answered in the negative whereas issue Nos.3 and 4, which pertains to jurisdiction to try the suit by the Court as also whether the suit is time barred or not were not pressed by the defendants.
Page 10 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined [3.13] In short, the suit is dismissed on the ground that the suit agreement is not signed by the Chairman of the Board nor any documents are produced to show that power to execute the same is delegated to any other Officer as per Section 22 of 'the Act'.
[4.0] On perusal of the record, it appears that the Appeal is admitted by an order dated 09.12.1994 by the Division Bench of this Court. When final hearing of the same is taken up, it is pointed out that all the documents of the suit, except 'A' and 'B' file are destroyed on 02.06.2006, and therefore, paper-book, which is finding place here contains only the pleadings and the impugned judgment. Registry has placed a note dated 05.09.2023 stating that the report submitted by the City Civil and Sessions Court reflects that no writ in the First Appeal has been received by the Registry of that Court. The original 'C' and 'D' files of both the proceedings i.e. Civil Suit Nos.2651 of 1982 and 3977 of 1982 came to be destroyed on 02.06.2006 by the concerned employees of that Court, who were posted to work in the record department and entrusted the task of old record in terms of office orders dated 11.05.2006 and 12.05.2006 on the establishment of the Principal Judge of that Court. As such, for an Appeal, which is admitted in the year 1994, it is surprising that no pending writ appears to have been issued by the Registry of this Court because of which the original 'C' and 'D' files of the suit proceedings came to be destroyed. Though Registry has reported that strenuous efforts have been made to trace out Page 11 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined the writ issued in the year 1994 but it is not traceable though search is still continued. However, it is stated in the further report dated 11.09.2023 that on verification of physical papers of Record and Proceedings vide application Exh.150 dated 08.08.1998, learned advocate for the plaintiff - Board before the trial Court had applied for return of papers for producing before the High Court wherein he has mentioned that the aforesaid First Appeal is pending before the High Court. On perusal of Rojnama dated 08.07.1998 and 14.07.1998 of the case, vide Exh.150 it reflects that learned advocate for the plaintiff - Board prayed for return of papers produced vide list Exhs.3 and 114 and accordingly the Court passed that order on that day. Registry has placed xerox copy of Exh.150 wherein it appears that it is a typed application wherein name of the plaintiff is shown to be M/s. United Construction Company, which is typed but thereafter it is scored off and in handwriting it is stated to be Gujarat Housing Board whereas in the place of defendant Gujarat Housing Board is typed and M/s United Construction Company is shown to be handwritten. The typed copy thereof at all places reflect as if it has been given on behalf of the advocate for the defendant but first two letters reflecting defendant (Prativadi) "Prati" is scored off at all places without signature of anyone and one line is inserted in handwriting stating that papers vide list Exhs.3 and 114 so it is made to appear that it is filed on behalf of advocate of the plaintiff - Board. It is another issue, apart from the issue of non issuance or non finding of writ issued in the year 1994 of admission of this Appeal, and therefore, it requires thorough inquiry that who has obtained those documents produced in Page 12 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined the suit itself.
[4.1] It may never happen that in the Appeal admitted in the year 1994 no writ would have gone to the concerned Court informing that the Appeal against the judgment and decree passed by that Court is pending before the High Court so as to see that the original papers may not be destroyed. Though it is claimed in the report by the Registry that strenuous efforts have been made by it to trace out the writ issued in the year 1994 as if writ has been issued by High Court. However, no copy thereof is finding place either in this papers or in the Registry. The Principal Judge, City Civil Court in no unclear terms informed that on thorough inquiry at their end, no writ in connection with the First Appeal No.1805 of 1994 has ever been received in its Registry. Be that as it may, Registrar General is hereby directed to hold inquiry into the same and take action against the persons responsible for the same, if available and practical. However, the fact remains that when the application, Exh.150, as pointed out by the Registry was moved before the trial Court for return of the documents reflects pendency of the Appeal, therefore, it was equally the duty of that Court before destruction of original documents to look at such application made and it should not have been destroyed. Registrar General is hereby directed to see that writ of admission of Appeals before the High Court, since now all the Courts have been equipped with computerization, writ goes to the Court and pendency of Appeal reflects in the computer system itself and the person at the helms of affairs has to verify whether any Appeal is pending or not before Page 13 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined destroying the original files.
[5.0] Coming back to the merits of this case, Ms. Krishna Raval, learned advocate for the plaintiff submitted that the execution of an agreement, may be by Executive Engineer and the defendant, is not at all disputed by the defendants but what is disputed is that it is signed by the Executive Engineer and not by the Chairman, and therefore, the agreement is claimed to be void ab initio. However, according to her submission, execution of an agreement Exh.115 a part of it, which is produced here as Form B - 1/3 1979-80 is duly signed by the partner of defendant No.1 and Executive Engineer, which bears stamp of Treasury Officer, Baroda as also the round seal of it and common seal of Gujarat Housing Board at page 7 thereof duly signed by partner of defendant no.1 and the Executive Engineer.
[5.1] Relying on the decision in the case of Gujarat Housing Board Vs. Harilal Jethalal reported in 2001 (3) GLH 157 it is submitted by the learned advocate for the appellant that as per 'the Act', Rules and Regulations as narrated in paragraph 7.4 thereof, the Executive Engineer is a person, who is delegated to sign the contract on behalf of the Housing Board, and therefore, contract Exh.115 not signed by Chairman is no ground to brand it as a contract void ab initio, and therefore, it is submitted that since no evidence is discussed at all by the learned Judge on other issues, the matter is required to be remanded back to the trial Court for a decision thereon, and therefore, it is submitted that this Appeal Page 14 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined is required to be allowed.
[6.0] As against that, Mr. Paras Sukhwani, learned advocate for the defendants vehemently submitted that the documents tendered before the Court as Exh.115 i.e. suit contract nowhere reflects that it is one and the same, which is produced at Exh.115. He has further submitted that since contract is void ab initio, as it is in breach of Sections 21 and 23 of 'the Act', it cannot be enforced against the defendants, that too, for recovery of the amount claimed in the suit.
[6.1] In support of his submission, learned advocate for the defendants has relied on the decision of the Supreme Court in the case of Bhikhraj Jaipuria Vs. Union of India reported in AIR 1962 SC 113, more particularly, paragraph nos.19 and 35 thereof to submit that contract on behalf of the Government /authority should be as per the provisions made in the Constitution /Act relating to the form of contracts on behalf of the Government are mandatory. He has also relied on the decision of the Supreme Court in the case of State of West Bengal Vs. B.K. Mondal and Sons reported in AIR 1962 SC 779 for the very same proposition to contend that since the suit contract is not signed by the Chairman, as admitted by the witness in his deposition in view of Section 21 of 'the Act', which is stated to be mandatory, non compliance thereof makes contract invalid and based thereon no suit for recovery could be filed by the plaintiff, and therefore, he has submitted that the suit is rightly dismissed by the Court and no interference in this Appeal is called for.
Page 15 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined [7.0] Having heard the learned advocates for the appearing parties as also going through the record, which is available, it appears that though evidence is led, different issued are framed, the learned Judge has not determined all the issues in accordance with law but answered only one issue stating that the suit itself is not maintainable as the suit contract is not signed by the Chairman of the plaintiff - Board as provided under Section 21 of 'the Act' and in view of the said finding, no other issues are examined in detail in accordance with law.
[7.1] Considering the judgment rendered by this Court in First Appeal No.3869 of 1995 to 3873 of 1995 filed by the Gujarat Housing Board, raising very same issue possibly by the same trial Court in connection with contracts for construction of different tenements for different income group wherein also trial Court determined the maintainability of the suit as preliminary issue on the ground that Chairman of the Board alone is empowered under Section 21 of 'the Act' to execute the contract, and therefore, dismissed the suit involved in the said group of Appeals on suit contracts being held to be void ab intio, this Court after considering the decision in the case of Harilal Jethalal (Supra) wherein also Executive Engineer had signed the suit contract allowed the Appeal as Executive Engineer is delegated powers to execute the contract as recorded in paragraph no.7.4 of the decision in the case of Harilal Jethalal (Supra) referred to by the coordinate Bench of this Court in the aforesaid Appeals in RE POINT No.2 quoting Page 16 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined whole paragraph thereof, we are unable to take a different view than the view taken by this Court in the aforesaid group of Appeals, that too, filed by very plaintiff -Gujarat Housing Board. The only point of difference in the present case is the evidence was recorded and instead of answering the suit on all the issues framed, suit came to be disposed of on the ground of authority of the Executive Engineer to sign the suit contract in view of Section 21 of 'the Act' and it is held to be not maintainable, and therefore, this Court is left with no option but to remand the case directing the Court concerned to answer all the issues on merit, after getting file reconstructed and for the purpose, both the parties are directed to cooperate and see that whole case is reconstructed before the Court and they are further directed to produce the documents as per the exhibits agreed upon inter se, which may facilitate the Court to pronounce the judgment.
[7.2] So far reliance placed on the decision of the Supreme Court in the case of Bhikhraj Jaipuria (Supra) and B.K. Mondal and Sons (Supra) relied on by the learned advocate for the defendants are concerned, they are not on the issues involved in the present case, as submitted by the learned advocate for the defendants, the decisions aforesaid are involving the issues, if contracts on behalf of the Government not executed in the form and the manner provided by the statute, cannot be enforced at the instance of other parties to the contract against the Government for compensation for breach of contracts. Even if the contentions raised on behalf of the defendants was to be accepted, in view Page 17 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023 NEUTRAL CITATION C/FA/1805/1994 JUDGMENT DATED: 04/10/2023 undefined of Sub-Section (2) of Section 23 of 'the Act', if the contract was not executed as provided in Section 23 of 'the Act' and the Rules made thereunder shall not be binding on the Board. So if the defendants were to file a suit claiming compensation for the breach of contract against the plaintiff - Board, having executed the same, which is not denied by him, acted upon the said contract and started executing the work under the contract, he can never be heard to say that the contract is void ab initio. Not only he entered into the said contract and for arguing it to be void, the contention is raised that it has not been executed by the Chairman of the Board, and therefore, it is held to be illegal by the Court whereas in view of decision in the case of Harilal Jethalal (Supra), it has been validly executed by the Executive Engineer, and therefore, the sole argument on which the suit is dismissed is not tenable at all. Therefore, there is no option but to set aside the judgment and decree passed by the Court and remand the case back to it for the decision in accordance with law keeping in mind what is stated hereinabove. Hence, Appeal is allowed to the aforesaid extent with proportionate cost. Record and Proceedings be sent back to the trial Court forthwith after retaining true copies thereof for the purpose of inquiry as aforesaid by the Registrar General.
(UMESH A. TRIVEDI, J.) (M. K. THAKKER, J,) siji Page 18 of 18 Downloaded on : Sat Oct 07 20:38:03 IST 2023