Delhi District Court
Ashok Kumar Rana vs Municipal Corporation Of Delhi on 3 January, 2026
Ashok Kumar Rana Vs. Municipal Corporation of Delhi
DLCT010076372025
IN THE COURT OF SH. DEEPAK GARG,
DISTRICT JUDGE-COMMERCIAL COURT-09
(CENTRAL DISTRICT), TIS HAZARI COURTS, DELHI
CIVIL SUIT (COMMERCIAL) NO.:- 598/2025
IN THE MATTER OF :-
Ashok Kumar Rana
Sole Proprietor of
M/s Ashok Kumar Rana
H. No. 270, Street No. 14,
Rana Mohalla, Soboli Village,
Delhi-110093 ... Plaintiff
VERSUS
1.Municipal Corporation of Delhi Through Its Commissioner, 9th Floor, Civic Centre, Minto Road, New Delhi-110002
2. The Executive Engineer (M-I) SHAH North Zone Municipal Corporation of Delhi D-1, Staff Quarters, Swami Daya Nand Hospital, Shahdara, Delhi. ... Defendants SUIT FOR RECOVERY OF RS.17,53,950/-
Date of institution : 24/05/2025
Date on which Judgment was reserved : 16/12/2025
CS (Comm.) No. 598/2025 Page 1 of 15
Ashok Kumar Rana Vs. Municipal Corporation of Delhi Date of Judgment : 03/01/2026 ::- J U D G M E N T -::
1. By way of present judgment, this court shall adjudi-
cate upon suit filed by the plaintiff against the defendants for recovery of Rs.15,80,136/- alongwith pendent elite and future interest @ 12% per annum.
PLAINTIFF'S CASE
2. Brief facts necessary for just adjudication of the present suit, as stated in the plaint, are as under:-
i. The plaintiff is the sole proprietor of M/s Ashok Kumar Rana, a firm duly enrolled as Munici- pal contractor with the defendants and is also regis- tered under the Delhi GST Act, 2017. The plaintiff and is engaged in the civil nature of work for the Municipal Corporation of Delhi since long.
ii. The defendant no. 1 i.e. MCD is a body corpo- rate of state of Delhi, established and governed un- der D.M.C. Act. The suit is being filed against the defendants through its Commissioner who is in charge of all the acts and day to day business of the defendants.CS (Comm.) No. 598/2025 Page 2 of 15
Ashok Kumar Rana Vs. Municipal Corporation of Delhi iii. The work, in respect of which the present suit is being filed was awarded to the plaintiff by the de- fendant no. 2 but since the defendant no. 1 is the overall in charge of all the activities of the MCD and the work order in question was also awarded by the defendant no. 2 to the plaintiff and on behalf of the defendant no. 1, therefore, the defendant no. 1 is the necessary and proper party for just adjudication of the present suit.
iv. The plaintiff being the Government Contractor approached for the work order through tender which was invited by the defendant no. 2. The defendant no. 2, after the satisfaction of the completion of the required conditions at the state of pre-work order, awarded work order No 19 dated 11.04.23, 33, 35 and 36 dated 18.04.23 for the nature of work as mentioned in the said work orders, to the plaintiff for and on behalf of defendant no. 1.
v. After the award of the aforesaid work orders, the plaintiff entered into an agreement with the de- fendants pertaining to the said work orders as a pre- condition of the award of the work orders and the same was signed by the plaintiff. The plaintiff made all the necessary arrangements for the execution and CS (Comm.) No. 598/2025 Page 3 of 15 Ashok Kumar Rana Vs. Municipal Corporation of Delhi completion of the awarded work and completed the said work orders to the satisfaction of Engineer-in- Charge/the defendant no. 2. The period prescribed for defect liability also passed over without any neg- ative remark and to the satisfaction of the Engineer- in-Charge/defendant no. 2.
vi. The defendant no. 2 completed the final mea- surement of the aforesaid work and recorded in measurement Books and same was accepted by the plaintiff. Thereafter, defendant no. 2 prepared and passed the bills pertaining to the aforesaid work or- ders and same were accepted by the plaintiff. Fur- ther as precondition of the award of work orders, the plaintiff had also deposited the security/earnest money towards the respective work orders. The de- tails of amount of bills, date of passing and amount of security/earnest money are tabulated as under :
S. Work Amount of Date of Amount of No. Order No. passed (first & passing of bill security/earnest final) bill in Money in Rs.
Rs.
1. 19 1st 4,22,324.00 21.11.2023 48,999.00 Running Bill
2. Withheld 10,000.00 amount
3. 33 1st & 4,42,947.00 12.02.2024 49,787.00 Final CS (Comm.) No. 598/2025 Page 4 of 15 Ashok Kumar Rana Vs. Municipal Corporation of Delhi Bills
4. 35 1st & 3,26,608.00 21.11.2023 37,472.00 Final Bills
5. 36 1st & 2,17,308.00 21.02.2023 24,695.00 Final Bills Total 14,19,182.00 1,60,136.00 Grand Total of 14,19,182+1,60,136 15,80,136.00 passed bills and security amounts vii. The defendants were under obligation to re- lease the aforesaid amount to the plaintiff within the aforesaid period of 6/9 months as laid down in clause 9 or within a reasonable time but the defen- dants have failed to release the payment of passed bill amount in favour of the plaintiff.
viii. Since the defendants neglected to make the payments, the plaintiff got issued a Legal Notice dated 21.11.24 to the defendants calling upon to re- mit the amount along with interest at the rate of 12% per annum. The said notice was duly delivered upon the said defendants but the defendants neither complied with the terms of the said legal notice nor replied the same in any manner.
CS (Comm.) No. 598/2025 Page 5 of 15Ashok Kumar Rana Vs. Municipal Corporation of Delhi ix. The defendants are liable to pay interest @ 12% p.a. on entire amount of Rs.15,80,136/- from 01.05.24 to 30.04.25 which comes to Rs.1,73,814/-. Thus the total suit amount including principal and interest comes to Rs.17,53,950/-. Hence, the plain- tiff has filed the present suit against the defendants.
DEFENDANT'S CASE
3. The defendants contended inter alia that the suit of the plaintiff is liable to be dismissed as it is without any cause of action since the plaintiff has not submitted any final bills. Though, the defendants admitted having awarded the Work Order No. 19, 33, 35 & 36 to the plaintiff, however, it is submitted that the plaintiff has not submitted any bills on his letter pad that he was contrac- tually required to in terms of Clause 4(B) of the Work Order and the purported bills that the plaintiff seeks to rely upon are only internal notings of the defendants and they do not constitute bills for the purpose of payment and the suit is without any cause of action.
4. It is further submitted that as the plaintiff has failed to comply with Clauses 17 & 45 of the GCC, he is not entitled to refund of security deposit.
CS (Comm.) No. 598/2025 Page 6 of 15Ashok Kumar Rana Vs. Municipal Corporation of Delhi EVIDENCE OF THE PLAINTIFF
5. In order to prove its case, plaintiff Sh. Ashok Kumar Rana has examined himself as PW1, who has filed his evidence by way of affidavit Ex.PW1/A and has relied upon the documents as under:
(i) A copy of registration certificate dated 03.12.2020 is ExPW1/1 (OSR).
(ii) Copy of GST Registration Certificate is ExPW1/2.
(iii) Work order bearing no. 19 dated 11.04.2023, Work order bearing no. 35 & 36 both dated 18.04.2023 are ExPW1/3, ExPW1/4 and ExPW1/5 respectively.
(iv) A copy of 1st running bill passed on 21.11.2023 with respect to work order no. 19 is ExPW1/6.
(v) A copy of 1st and final bill passed on 12.02.2024 with respect to work order no. 33 is ExPW1/7.
(vi) A copy of 1st and final bill passed on 21.11.2023 with respect of to work order no. 35 is ExPW1/8.
(vii) A copy of 1st and final bill passed on 24.11.2023 with respect to work order no. 36 is ExPW1/9.
(viii) Copy of relevant pages of general terms and condition of MCD is ExPW1/10.
(ix) Copy of legal notice dated 21.11.2024 along with postal receipts are ExPW1/11 (colly).
(x) Copy of non starter report dated 05.05.2025 issued by DLSA is ExPW1/12.CS (Comm.) No. 598/2025 Page 7 of 15
Ashok Kumar Rana Vs. Municipal Corporation of Delhi PW1 further stated that payment of first running bill of Rs. 4,22,324/- for work order no. 19 has been received on 14.11.2025. Further an amount of first and final bill of Rs. 4,42,947/- for work order no. 33 has been received on 14.11.2025. Further an amount of first and final bill of Rs. 3,26,608/- for work order no. 35 has been received on 14.11.2025 and an amount of first and final bill of Rs. 2,17,308/- for work order no. 36 has been received on 14.11.2025.
Now the remaining amount left stands to Rs.1,70,136/- i.e. Rs. 10,000/- is withheld amount for work order no. 19 and Rs.1,60,136/- is the total security amount for work orders no. 19, 33, 35 and 36.
6. This witness was cross-examined by the Ld. Counsel for the defendants and the same shall be discussed in the later part of the judgment.
EVIDENCE OF THE DEFENDANT
7. Despite opportunity being given, defendants have not lead any evidence in support of their claim.
MY FINDINGS
8. It is the case of the defendants that suit of the plain-
tiff is pre-mature and he is not entitled to the suit CS (Comm.) No. 598/2025 Page 8 of 15 Ashok Kumar Rana Vs. Municipal Corporation of Delhi amount for want of submitting the final bills for pay- ment. Reliance is placed upon the judgment in the case of North Delhi Municipal Corporation Vs. San- jeev Kumar RFA No. 430/2017 decided on 22.03.2018.
9. It is the case of the plaintiff that the present suit has been filed in respect of work orders No. 19, 33, 35 & 36 and first & final bills in respect of the said work or- ders were passed by the defendants corporation in the sum of Rs.14,19,182/- from time to time. It is further the case of the plaintiff that the security/earnest de- posit amount of Rs.1,60,136/- in respect of the said work orders also remains to be paid by the defendants. This is not disputed by the Ld. Counsel for the defen- dants as well.
10. In respect of the said work orders, it is the case of the plaintiff that the defendants had passed the first running bills in respect of the different work orders in the sum of Rs.14,19,182/- which are Ex.PW1/6 to Ex.PW1/9 and the first page of the said bills were filled by the plaintiff and the remaining pages were filled by the officials of the defendants.
11. It is relevant to state that, at the stage of plaintiff's evidence, it was submitted by Ld. counsel for the de-
CS (Comm.) No. 598/2025 Page 9 of 15Ashok Kumar Rana Vs. Municipal Corporation of Delhi fendants/MCD that the entire payment has already been made to the plaintiff except Rs.10,000/- being the withheld amount in respect of work order no. 19 and Rs.1,60,136/- i.e. the security amount for the work or- der no. 19, 33, 35 & 36.
12. It is further relevant to state that during cross-exami-
nation, PW1 i.e. the plaintiff admitted in the court that payment of first running bill of Rs. 4,22,324/- for work order no. 19 has been received on 14.11.2025. Further an amount of first and final bill of Rs. 4,42,947/- for work order no. 33 has been received on 14.11.2025. Further an amount of first and final bill of Rs. 3,26,608/- for work order no. 35 has been received on 14.11.2025 and an amount of first and final bill of Rs.2,17,308/- for work order no. 36 has been received on 14.11.2025.
13. PW1 further admitted in the cross-examination that now the only amount left is Rs.1,70,136/- in total i.e. Rs. 10,000/- is withheld amount for work order no. 19 and Rs.1,60,136/- is the total security amount for work orders no. 19, 33, 35 and 36.
14. The plaintiff in his testimony as PW1 has categori-
cally deposed that he immediately after the award of work orders made all the necessary arrangements for CS (Comm.) No. 598/2025 Page 10 of 15 Ashok Kumar Rana Vs. Municipal Corporation of Delhi the execution and completion of the awarded work or- ders and completed the said work orders before the stipulated time. He further deposed that the work was completed by the plaintiff to the satisfaction of Engi- neer-in-Charge/Defendant no. 2 and the period pre- scribed for defect liability also passed over without any negative remark and to the satisfaction of the Engineer- in-Charge/defendant no. 2. He further deposed that the defendant no. 2 completed the final measurement of the aforesaid work recorded in measurement books, thereafter the defendant no. 2 prepared and passed the first & final bills pertaining to the aforesaid work or- ders and same were accepted by the plaintiff.
15. The issue of award of work order No. 19, 33, 35 & 36 to the plaintiff, the plaintiff having completed the said work orders within time without any negative re- mark, final measurements of the work also carried out by the defendants and the preparation of the running bills in respect of the said work have not been denied by the defendants.
16. Nothing has been brought on record by the defen-
dants to prove that the plaintiff is not entitled to the re- lief sought in respect of the said work order No. 19, 33, 35 & 36. There is no reason to disbelieve the testimony CS (Comm.) No. 598/2025 Page 11 of 15 Ashok Kumar Rana Vs. Municipal Corporation of Delhi of PW1 and in view of unrebutted and unchallanged documents proved by the plaintiff in respect of the said said work order No. 19, 33, 35 & 36.
17. Thus, after the admission of defendant regarding payment of amount of first & final bills amounting to Rs.14,09,187/- on 14.11.25 to the plaintiff in respect of the said work orders No. 19, 33, 35 & 36, the plea of defendant about non-submission of final bill has no merit. The plaintiff is held entitled to the payment of Rs.10,000/- (withheld amount for work order no. 19).
18. Coming to the issue of refund of security deposit and earnest money in respect of said work order, the defen- dants have taken a plea that plaintiff is not entitled to refund for security for want of compliance of Clause 17 and 45 of GCC.
19. In this regard, the Hon'ble High Court of Delhi in case of Rajnish Yadav, Proprietor of M/s Bharat Con- struction Co. (supra) has observed as under :-
25. ........... There is no dispute that the security deposit is refundable to the appellant/plaintiff and the same could be withheld only to secure MCD against any claims due to non-perfor-
mance of the statutory obligations on the part of the appellant/plaintiff. There is no material to indicate that the appellant/plaintiff has not cleared its due towards labour or any other statutory levy. A considerable amount of time CS (Comm.) No. 598/2025 Page 12 of 15 Ashok Kumar Rana Vs. Municipal Corporation of Delhi has lapsed since the contract was complete. Admittedly, no claim has been made against MCD on account of any acts of commission or omission on the part of the appellant/plaintiff. Denying the appellant's/plaintiff's claim in this context would amount to permitting MCD to appropriate the security amount. Admit- tedly, there are no grounds for MCD to appro- priate the security deposit. Thus, the same is required to be refunded to the appellant/plain- tiff.
20. As stated above, no evidence has been led by the de-
fendant.
21. Hence, there is no evidence of the defendant on record with regard to non submission of any labour clearance certificate and it is also relevant here to state that nothing has been placed on record by defendants to bring out that plaintiff has failed to clear the dues to- wards labour or any other statutory levy in respect of the said work orders. Admittedly, no claim has been made against defendants/MCD on account of any acts of commission or omission on the part of plaintiff and thus in these facts and circumstances as well as in view of the observations made in the judgment of Rajnish Yadav, Proprietor of M/s Bharat Construction Co. (supra), plaintiff is also entitled to refund of the secu- rity deposit and earnest money of Rs.1,60,136/- qua the said work orders subject to statutory deductions by the MCD, if any.
CS (Comm.) No. 598/2025 Page 13 of 15Ashok Kumar Rana Vs. Municipal Corporation of Delhi
22. Ld. counsel appearing for the defendants states that as per Clause 7 of the agreement, defendants are not li- able to pay interest. On the other hand, Ld. Counsel appearing for the plaintiff urges that since the defen- dants failed to make payment within a period of 9 months, the defendants are liable to pay interest @ 12% p.a. on the entire outstanding amount.
23. It is relevant to state that the plaintiff has not fur-
nished any evidence of payment of GST on the bills in question. It is clear that GST is not paid on the said bills by the plaintiff in respect of work orders in ques- tion. However, since the defendants have themselves made substantial payment to the plaintiff with respect to work orders in question, this Court did not deem it fit to delve into the point of non payment of GST, while deciding the claim of the plaintiff for the princi- pal amount in respect to the said work orders but as far as the claim of interest is concerned, in my view, in the absence of GST paid bills, this Court does not deem it fit to grant past interest on the said amount.
24. In terms of the foregoing observations, with respect to the work orders No. 19, 33, 35 & 36, defendants are directed to pay as under :
(i) an amount of Rs.10,000/- in respect of the first & final CS (Comm.) No. 598/2025 Page 14 of 15 Ashok Kumar Rana Vs. Municipal Corporation of Delhi bill within four weeks from today failing which interest @ 8% p.a. shall be payable till realization.
(ii) further the defendants would refund the security deposit and earnest money of Rs.1,60,136/- in respect of the said work orders within four weeks from today failing which interest @ 8% p.a. shall be payable till realization.
25. Decree sheet be prepared accordingly.
26. File be consigned to Record Room.
Digitally
signed by
DEEPAK DEEPAK GARG
Date:
GARG 2026.01.03
15:52:37
+0530
Announced in the open Court on (Deepak Garg)
Day of 03rd January, 2026 Distt. Judge, (Comm. Court)-09,
Central District, THC : Delhi
CS (Comm.) No. 598/2025 Page 15 of 15