Bangalore District Court
Sjr Infrastructure Pvt Ltd vs Atlanta Ltd on 7 November, 2024
KABC170104902020
IN THE COURT OF LXXXIV ADDL. CITY CIVIL AND
SESSIONS JUDGE (CCH-85) (COMMERCIAL COURT),
BENGALURU
DATED THIS THE 7th DAY OF NOVEMBER 2024
PRESENT
SRI.RAMAKANT CHAVAN,
B.Com., LL.B.(Spl)
LXXXIV ADDL. CITY CIVIL & SESSIONS JUDGE,
BENGALURU.
Com.O.S.No.6411/2011
PLAINTIFF:
SJR Infrastructure Pvt. Ltd.,
A company incorporated under
the Companies Act, 1956,
having its Regd. office at SJR Primus,
7th and 8th Floors, Industrial Layout,
Koramangala, 7th Block,
Bengaluru - 560 095
Rep. by its Chairman
Mr. S. Jarama Reddy
(By Sri.G.V.Sudhakar, Adv.)
AND
DEFENDANT:
Atlanta Ltd.,
A company incorporated under
the Companies Act, 1956,
having its Regd. office at 101,
Shree Amba Shanti Chambers,
2 Com.O.S.No.6411/2011
Opp. Hotel Leela Kempenski,
Andheri - Kurla Road,
Andheri (East),
Mumbai - 400 059
(By Smt.Maneesha Kongovi, Adv.)
Date of Institution 02.09.2011
Nature of suit For recovery of money
Date of commencement of 17.08.2013
recording of evidence
Date on which judgment
07.11.2024
pronounced
Years Months Days
Total duration
13 02 05
LXXXIV Addl. City Civil & Sessions Judge
(CCH-85) Commercial Court, Bengaluru
JUDGMENT
This is a suit filed by the plaintiff against the defendant for recovery of Rs.27,55,92,150/- as per the Statement of Claim and future interest thereon from the date of the suit till the date of decree and further interest at 18% p.a. or at such other rate that this court may deem fit and proper from the date of the decree till payment and realization thereof and cost of the suit.
3 Com.O.S.No.6411/20112. Brief facts of the plaintiff's case are that, the plaintiff is a registered company and is in the business of infrastructure that of general construction contractors and engineers to construct, execute, carry out, undertake works of roads, bridges and allied works. The defendant was incorporated on 17.01.1984 as Atlanta Construction Company. Thereafter, the defendant became and was named as Atlanta Infrastructure Ltd. It acquired present name on 16.12.2004. The business of the defendant is of general construction contractors and engineers, to construct, execute, carry out, undertake works of roads, bridges, docks etc. It is further pleaded that this suit is filed for recovery of a sum of Rs.27,55,92,150/- pursuant to and in accordance with the final judgment and order dated 07.04.2011 passed by the Hon'ble High Court of Judicature, at Bombay in Co.P.No.419/2010 as modified by the order dated 08.06.2011 of the Division Bench of the Hon'ble High Court of Judicature at Bombay in Appeal (Lodg.) No.275/2011.
It is further pleaded that on 03.12.1998, the BMP - Bengaluru Mahanagara Palike entered into a Contract with the defendant for improvement of Arterial and Sub Arterial roads in Bengaluru City, Package III, South. Pursuant to the Agreement, the BMP had paid to the defendant a mobilization advance of Rs.2.43 Crores. There was another contract between the defendant and the BMP and nor were there any works to be carried out by the defendant. The defendant, despite receipt of the mobilization advance, did not deploy funds, infrastructure 4 Com.O.S.No.6411/2011 and man power and completely neglected to perform its obligations under the contract and only created a facade of commencing works by employing petty contractors, who did not have any capabilities or expertise and were wholly incompetent to execute the works under the contract. The BMP has issued a notice threatening to terminate the contract, if the defendant did not perform its obligations satisfactorily.
It is further pleaded that, Mr.S.Jayarama Reddy, the Chairman of the plaintiff at that time and other Senior Executives of the plaintiff company participated in discussions held at BMP office with the defendant on 02.04.1999, 24.06.1999 and 18.11.1999. At the time of hearing, the defendant and the representatives of the plaintiff company were able to persuade the then BMP to allow the plaintiff company to perform the contract dated 03.12.1998 as sub-contractor of the defendant. The defendant, accordingly engaged the plaintiff company as sub-contractor to execute all the works i.e. bituminous as well as civil works under the contract, the plaintiff entered into an Agreement with the defendant on 17.11.1999. By this Agreement, it was agreed that the plaintiff company would carry out all the works i.e. bituminous as well as civil works under the contract and the defendant would pay to the plaintiff company a total of 75% of all the amounts received by it from BMP for the said project including extra works, variation items, escalation etc. The plaintiff company commenced the work under the Agreement, the entire work awarded to the defendant by the 5 Com.O.S.No.6411/2011 BMP was carried out by the plaintiff, since the defendant lacked resources, skills and infrastructure to do the same. The defendant had been blacklisted by the BMP, but, in the public interest and because of the competence and track record of the plaintiff company, the BMP had agreed to continue the contract with the defendant on the condition that the work would be sub-contracted to the plaintiff.
It is further pleaded that, pursuant to the award of contract from the BMP, the defendant had engaged some petty contractors to do the said work. After entering into the contract with the plaintiff, the defendant paid off these contractors and deducted the amounts paid from the amounts payable to the plaintiff company. The defendant deducted from the amounts payable to the plaintiff company i.e. a total amount of Rs.43,55,426.06 as amounts paid to the said petty contractors and the defendant has accounted and recorded the deduction of the said amount from the sums payable to the plaintiff company under RA bill Nos.1 to 4 to its accounts statement upto March 2000. The defendant was the contractor and the plaintiff company was only permitted by the BMP to carry out the works as sub-contractor, all bills were raised and presented to BMP only by the defendant. So, all the bills were released by BMP only to the defendant.
It is further pleaded that, the bills were prepared by the defendant based on the works carried out by the plaintiff company under the contract. The plaintiff company jointly with 6 Com.O.S.No.6411/2011 the defendant, prepared a total of 15 RA bills aggregating Rs.49,04,88,160/-, all of which were submitted to the BMP by the defendant, the amounts of the said bills and the Cumulative Bill submitted by the defendant to the BMP aggregated a total sum of Rs.49,04,88,160/- which included (i) Rs.43,55,426.06 paid to the petty contractors for the works done by them before the plaintiff company commenced the work as sub contractor, (ii) the cost of bitumen and rentals of certain equipment i.e. paver, sprayer, vibrator roller and Six Trucks supplied by the defendant and (iii) the works carried out by the plaintiff company.
It is further pleaded that, the BMP on receipt of the said claim of Rs.49,04,88,160/- under 15 RA bills presented by the defendant, approved and sanctioned a payment only of Rs.34,85,50,180/- under the said 15 RA bills. The BMP wrongly and illegally withheld the payments for various items executed including extra and excess works executed by the plaintiff company, price variation of bitumen. The defendant received the part payments aggregating Rs.34,85,50,180/-, the defendant assured the plaintiff that it would take up the matter of unpaid amounts under the bills with the BMP and also undertook to pay to the plaintiff company 75% of the outstanding amounts under each of the running account bills as and when received by the defendant from the BMP. Under the said Agreement dated 17.11.1999, the defendant was bound and liable to pay a total amount of Rs.26,14,12,635/- being 75% of the total amounts receivable by the defendant from the BMP by deducting the cost 7 Com.O.S.No.6411/2011 of bitumen and rentals of the equipment referred above and TDS and this is also recorded by the defendant in its accounts statement.
It is further pleaded that the defendant received part payment from BMP pertaining to these bills of Rs.34,85,50,180/- and therefore, a total sum of Rs.26,14,12,635/- being 75% of the receipts was payable by the defendant to the plaintiff company. As per the Agreement dated 17.11.1999, after the deductions, the defendant was liable to pay a total amount of Rs.16,98,18,008/- as per the schedule. But, the defendant paid only Rs.13,64,75,899/- citing a cash crunch and undertook to pay the balance amount of Rs.3,43,42,108/- to the plaintiff company with regard to 16th RA bill. The defendant did not supply any further bitumen and withdraw all its equipments and trucks as there was no work left, after completion of the work which is pertaining to 15 RA bills, under the contract awarded by the BMP to be done in which the bitumen was required by the plaintiff company to be used as only civil works like footpaths, drains were to be completed by the plaintiff company. The defendant did not supply any material for Civil works such as drains, footpath, earth works, minor bridges, kerbings, concreting and ducts.
It is further pleaded that the BMP has failed to pay the 15 RA bills in full to the defendant, led to serious disputes between the BMP and the defendant as well as the plaintiff company. The defendant did not submit 16th RA bill to the BMP and thereafter, did not prepare any further RA bills for the work done. The 8 Com.O.S.No.6411/2011 plaintiff company completed the entire work in the month of November 2001.
It is further pleaded that the disputes between the plaintiff company and the defendants as well as BMP were referred to the Sole Arbitrator by the Hon'ble High Court of Karnataka and he entered upon the reference on 12.12.2001. The defendant filed a claim statement. The Sole Arbitrator passed the award on 22.03.2003 and additional award on 31.05.2003. He has passed the award in favour of the defendant for a sum of Rs.21,63,45,437/- together with further interest thereon at the rate of 6% p.a. till payment, in respect of the work carried out by the plaintiff company as contemplated by the contract dated 03.12.1998. The defendant has filed A.S.No.15002/2023 for execution of the award dated 11.08.2009, the court has confirmed the award dated 22.03.2003 and additional award dated 31.05.2003.
It is further pleaded that the plaintiff company by its letter dated 05.01.2010, enclosed its bill for Rs.6,27,53,463/- which had been prepared as per the part payment received by the defendant from BMP on 04.12.2009. The plaintiff also recorded the fact of the said meeting held on 11.11.2009. By letter dated 08.01.2010, the defendant purported to deny the said claim made by the plaintiff company and alleged that the same was de- hors the terms of the Agreement, false and made only with a view to claim payment for items which it alleged the plaintiff company had neither carried out nor was entitled to on the 9 Com.O.S.No.6411/2011 grounds alleged in the said letter. The defendant remained silent about the amount of Rs.28,73,52,780/- received from the BMP and alleged that, only Rs.1,08,52,365/- was payable to the plaintiff company as full and final settlement of its dues under 16th RA bill after deducting payment of Item No.4.07. The Chairman and the officials of the plaintiff company met the MD of the defendant in Mumbai on 19.01.2010 and requested for payment of the amounts due. The MD of the defendant had admitted that the defendant was liable to pay to the plaintiff company a sum equivalent to 75% of the receipts, as and when received by the defendant from BMP. The MD of the defendant also requested the plaintiff company to take a lenient view of the matter and accept the interim payment of Rs.1.35 Crores, which the defendant promised to release immediately and also in addition to the said payment, the defendant would pay the balance sums due to the plaintiff out of the amount received by the defendant on 04.12.2009. The plaintiff company sent a FAX and email on 23.01.2010 requesting the defendant to release the interim payment as promised.
It is further pleaded that, the defendant has replied the email on 01.02.2010 and again reiterated the contents of its letter dated 08.01.2010, that a sum of Rs.1,08,52,365/- is due and payable after deducting TDS, advances and expenses incurred on the plaintiff's account. The plaintiff company by a FAX, email and RPAD on 16.02.2010 and again called upon the defendant to pay 75% of all the sums received from BMP. The 10 Com.O.S.No.6411/2011 defendant again repeated the contents of its letter dated 01.02.2010 by its letter dated 03.03.2010 and the plaintiff replied the same on 09.03.2010. The plaintiff company has issued notice to the defendant calling upon to pay a sum of Rs.22,05,12,492/- with interest, but, in the notice the earlier notice dated 09.03.2010, the amount of Rs.9.00 Crores had been wrongly stated as Rs.9.00 lakhs. The said notice is to be treated as notice U/Sec.434 of the Companies Act. But, the defendant has denied the contents of the notice.
It is further pleaded that the BMP paid an amount of Rs.28,73,52,780/- to the defendant on 04.12.2009, 20.03.2010, 30.03.2010 and 24.09.2010. The amount has been paid pursuant to the awards which clearly direct the BMP to make payment to the defendant in respect of the works carried out by the plaintiff company - (a) Rs.13,08,29,200/- towards unpaid sums of 15 RA bills and RA bill No.16, (b) Rs.3,38,93,150/- towards price variation of bitumen, (c) Rs.5.00 lakhs towards penalty and was deducted entirely from the plaintiff's account by the defendant.
(d) Rs.9,28,356/- towards refundable interest,
(e)Rs.1,06,77,852/- towards refund of security deposit,
(f) Rs.1,71,73,330/- towards compensation and (g) interest at the rate of 6% on these amounts from 01.11.2001 and
(h) Rs.16.00 lakhs towards costs. The defendant is bound and liable to pay to the plaintiff company 75% of the total amount of these amounts except Item Nos.(d), (e) and (h). These exclusively go to the defendant and Item No.(e) is exclusively 11 Com.O.S.No.6411/2011 entitled by the plaintiff company. Hence, the plaintiff company is constrained to file this suit.
3. After service of summons, the defendant put its appearance through its counsel and filed written statement. The defendant has denied most of the plaint averments and further contended that the defendant has a company with standing repute in the market and financially sound, is always ready and willing to honour all its contractual commitments, which are legal and binding on it within the stipulated time frame. The plaintiff company has deliberately failed to abide by the terms and conditions mentioned in the Agreement dated 17.11.1999 as mis-spelt. The entire facts pertaining to the transactions between the parties. The plaintiff company has also withheld vital documents which constitute material facts, that are necessary for adjudicating the claim. It has suppressed the material facts. It is further stated that the BMP had entered into an agreement with the defendant on 03.12.1998 for improvements of Arterial roads and sub-arterial roads in Bengaluru City - III South to carry out the works based on the terms and conditions agreed between the parties. Pursuant to the same, the defendant executed various works at different roads, by deploying its required machineries like crushing plant, Hot mix plant, paver finisher, bitumen sprayer, compactors, Tippers and engineering staffs were deployed by them in order to execute the obligations undertaken under the agreement. In order to expedite the entire process, the plaintiff company based on the work order was appointed as a 12 Com.O.S.No.6411/2011 sub-contractor for some of the roads to carry out civil works based on the terms and conditions, the responsibility of the defendant was to extract Bolven Crush aggregates with the same for bituminous mixes, to procure and supply bitumen to the plaintiff company, to provide bituminous mixes like bituminous macadam, dense BM and bituminous concrete at a fixed rate as agreed and to provide machines like paver finisher, bitumen sprayer, Tippers etc. The increase or decrease in the price of bitumen will be on account of the defendant, apart from the bitumen, the Hot mix plant and other machine were to be that of the defendant. The material items which would for the subject matter for considering the present claim made by the plaintiff company - the plaintiff's responsibility was to transport the Hot mix bituminous materials from the defendant's plant to work site, the manual work of cleaning the road, GSB surface, applying prime quote, tack quote, laying of bituminous mixes and its compaction as per design and specification was to be done by the plaintiff company.
It is further stated that the defendant also wish to emphasize on the fact that the plaintiff was permitted to carry - all Civil works for some of the roads as sub-contractor for improvements of arterial and sub-arterial roads, in Bengaluru City at the instance of the defendant so as to provide an opportunity for the plaintiff company to gain experience in the said field. The defendant in its life span of about Three decades, it has successfully implemented various similar projects and as 13 Com.O.S.No.6411/2011 on the date of it is constructing roads worth of Rs.2,500 Crores all over India. On completion of each stage of construction/ work/ improvement, the defendant raised bills and addressed the same to the BMP for payment. The entitlement of the plaintiff company, in respect of the amounts claimed by it under the 15 RA bills dated 07.09.2001 were based on the works executed by them and the deductions which the defendant was entitled to for the supplies made to the plaintiff company - gross value of bill Rs.1,74,15,395/-, less recoveries against supply of material and machinery, Rs.1,60,05,654/-. Hence, the net payable after deducting TDS is Rs.13,38,073/-.
It is further stated that the supplies made and the deductions which the defendant made was based on the supplies made to the plaintiff company as per the Agreement entered into by both the parties. The plaintiff company is entitled under 15 RA bills, after deducting the TDS, the total amount payable was Rs.13,38,073/- and same was paid by the defendant on ad-hoc basis, Rs.12.00 lakhs by way of cheque dated 26.09.2001 drawn on HDFC Bank, Andheri. Hence, the entire claim of the plaintiff company in respect of 15 RA bills were duly settled irrespective of the pending dues which the BMP owed to the defendant and the plaintiff company having unconditionally accepted the payment out of its own will and consent. Hence, the matter had attained finality as on the date of payment. The work order based on which the plaintiff company was operating as a sub-contractor, came to be superseded by the Agreement, wherein the terms 14 Com.O.S.No.6411/2011 and conditions agreed by the parties came to be modified/revised at the request of the plaintiff company - the plaintiff company for execution of Civil Works would be entitled to 75% of the quoted rates for each item of work, whenever part rates are paid, for any item by BMP, the plaintiff company would be entitled to 75% of the said part rates, the work as per the Bill of Quantities - BOQ and bituminous items ought to be completed with 31.03.2000 and the defendant agreed to provide entire bitumen and bituminous mixes, transportation, plant and equipment to the plaintiff at the rates stipulated therein. It is also pleaded regarding Clause No.7.0 of the Agreement.
It is further stated that on the completion of the works, the defendant submitted 16th RA bill to BMP for payment of Rs.2,14,03,960/- on 29.04.2002 and same was certified by the corporation for Rs.2,05,16,843/-, but, the payments of the same were not made by the Corporation. At the time of submitting of 16th RA bill, the other bills - 14, 15 and 16 are pending for Rs.3,95,96,018/-, Rs.2,12,95,585/- and Rs.2,05,16,843/-. The entitlement of the plaintiff company in respect of the amounts claimed by the defendant under 16 th RA bill were based on the works executed by it and the deductions which the defendant was entitled for the supplies - gross amount Rs.1,72,01,061/- and certified by the defendant Rs.1,50,82,047/-, less advance paid Rs.25.00 lakhs, less miscellaneous expenses, Rs.15,08,705/- less deductions of material Rs.73,96,825/- less TDS Rs.2,21,477/-. Hence, net amount payable is 15 Com.O.S.No.6411/2011 Rs.34,55,540/-. As per the orders of the Hon'ble High Court of Mumbai Rs.1.00 Crore has already been deposited in the court.
It is further stated that the supplies made and the deductions which the defendant was entitled to under RA 16 th bill for all the machineries and bituminous mix supplied to the plaintiff. In the mean time, as Corporation deliberately failed to honour the payments for the bills raised by the defendant, arbitration proceedings were initiated by the defendant against Corporation by filing CMP No.74/2001 seeking for appointment of an Arbitrator, and as per the orders dated 18.08.2001 Arbitrator was appointed to adjudicate the disputes between the parties. The Arbitrator after hearing the parties passed an award on 22.03.2003 and subsequent on 31.05.2003, allowed the claim in part and directed the Corporation to pay a sum of Rs.19,40,01,889/- towards the pending bills, price variation of bitumen, refund of penalty and security deposit with interest at the rate of 6% p.a. from 01.11.2001 and a sum of Rs.16.00 lakhs as cost of the proceedings. The Corporation and the defendant challenged the award passed by the learned Arbitrator in two suits in AS No.46/2003 and 15002/2003. A common order has been passed on 11.08.2009 and uphold the award passed by the learned Arbitrator and decree was drawn. The plaintiff for the first time by its letter dated 05.01.2010 to the defendant made a claim for a sum of Rs.6,27,53,463/- as alleged dues in respect of the civil works carried out by the plaintiff.
16 Com.O.S.No.6411/2011It is further pleaded that, the defendant replied on 08.01.2010 that in terms of the Agreement the plaintiff raised RA bill 16 on 18.02.2002 for its part of work and after completion of the work and the same was received by the defendant on 01.06.2002 amounting to Rs.1,72,01,061/-. The defendant has made part payment against the said bill in advance of Rs.25.00 lakhs by way of cheque dated 15.05.2002. The defendant also informed the plaintiff by way of reply on 08.06.2002 that in terms of the conditions of sub contract mentioned in the Agreement, the plaintiff had to get its measurements checked and recorded by Corporation for the work done in terms of Clause 4.17 of the Agreement, prior to seeking payments. As per Clause 4.18 of the Agreement, it was the plaintiff's responsibility to process and progress the monthly and final bills for the work undertaken in the Agreement with Corporation. It was also brought to the plaintiff's notice that all the measurements were to be got recorded and check measured from BBMP by the plaintiff on or before 31.05.2002 which the plaintiff failed to and in view of the plaintiff's bills had been finalized on the basis of the measurements already recorded. The claim of the plaintiff made in excess of Rs.1.72 Crores is barred by limitation.
It is further pleaded that, in terms of the Agreement and after deducting payment of Item No.4.07 which was not recorded by Corporation, the total payment against the RA 16 th bill dated 18.02.2002 will be Rs.1,08,52,365/- subject to settlement of the plaintiff's supply bill amounting to Rs.73,96,826/- and informed 17 Com.O.S.No.6411/2011 that the said payment will be released to the plaintiff on receipt of the final payment from the Corporation. The plaintiff irrespective of the same by its letter dated 23.01.2010 demanded for release of an interim amount of Rs.1.35 Crores due under the Agreement for which the defendant replied on 01.02.2010 stating that the plaintiff is only entitled to Rs.1,08,52,365/- subject to settlement of the defendant's supply bill amounting to Rs.73,96,826/- and also clarified that the plaintiff is not entitled for 75% of the sum to be received by the defendant from Corporation. The plaintiff was called upon to furnish the receipt of full and final settlement certificate, receipt of payment from Corporation and settlement of supply bill of the defendant for Item No.4.08, 4.09 and 4.10 amounting to Rs.73,96,826/- as per the terms of the Agreement in order release the payment of Rs.1,08,52,365/- after receipt of payment from the Corporation.
It is further pleaded that, the plaintiff instead of complying with the obligations, issued a letter on 16.02.2010 began to justify its stance and made illegal demand seeking for payments. In response to the letter the defendant replied on 03.03.2010 and clarified that the plaintiff would be entitled only a sum of Rs.1,08,52,365/-. After settlement of supply bills, receipt of payment from Corporation and on receipt of full and final settlement certificate from the plaintiff. The plaintiff also issued a legal notice on 14.06.2010 under the provisions of Companies Act, the said notice was replied on 19.07.2010 and once again 18 Com.O.S.No.6411/2011 clarified that the plaintiff would be entitled to only a sum of Rs.1,08,52,365/-. The plaintiff filed a Company Petition under the provisions of Sec.433(e) and (f) seeking for winding up of the defendant company in the High Court of Judicature, Bombay in CP No.419/2010. The defendant contested the petition by submitting objections and the plaintiff filed rejoinder. The Company Petition was concluded on 07.04.2011 and held that there are disputed question of facts, in the claim made by the plaintiff against the defendant the said Company Petition came to be disposed off by directing the defendant to pay a sum of Rs.1.00 Crore to the plaintiff on or before 31.05.2011. The defendant challenged the order in Appeal No.275/2011 / Appeal No.348/2011 which came to be disposed of, permitting the plaintiff to withdraw a portion of the amount deposited with direction to the plaintiff to initiate legal action to pursue its claim.
It is further pleaded that, the defendant as a successful bidder for improvements of Arterial and Sub Arterial roads in Bengaluru, package III, executed an Agreement on 03.12.1998 in favour of the defendant to carry the works and mobilization advance of Rs.2.43 Crores received by the defendant on different dates in the month of December 1998 and January 1999. The plaintiff carried out civil works as per the Agreement dated 17.11.1999, but, it is denied that the entire work was carried out by the plaintiff as the defendant lacked the resources, infrastructure and expertise. The plaintiff was appointed as sub- contractor for carrying out the civil works for some roads. There 19 Com.O.S.No.6411/2011 were also other sub-contractors, who were also appointed for carrying out the civil works and they were paid also. The plaintiff's entitlement under the RA 15 bills, the total amount payable was Rs.13,38,073/- which was paid by the defendant to the plaintiff on adhoc basis Rs.12.00 lakhs by way of cheque dated 26.09.2001. Hence, the entire claim of the plaintiff in respect of 15 RA bills were duly settled irrespective of the pending dues. The learned Arbitrator directed the Corporation to pay a sum of Rs.19,40,01,889/- along with interest at the rate of 6% p.a. from 01.11.2001 till date of payment and a sum of Rs.16.00 lakhs towards costs and it was not Rs.21,63,45,437/- as claimed by the plaintiff. The defendant received a sum of Rs.28,73,52,783/- from BMP. But, it is false that the payments were made for the entire works carried by the plaintiff as listed therein. The payment was made for the entire work and the defendant had accordingly paid to the plaintiff and as on date there is nothing due and payable to the plaintiff. Hence, prays for dismissal of the suit.
4. Based on the above, this court has framed the following:
ISSUES
1. Whether the plaintiff proves that the defendant is due and liable to pay the suit claim of Rs.27,55,92,150/- as prayed for?
2. Whether the plaintiff proves that the defendant is also liable to pay the interest as claimed?20 Com.O.S.No.6411/2011
3. Whether the suit is barred by limitation?
4. Whether this court has no territorial jurisdiction to try this suit as contended by the defendant?
5. Whether the plaintiff is entitled for a judgment and decree as sought for?
6. To what order or decree?
5. To prove the case, the plaintiff's Chairman and Managing Director is examined as PW1 and got marked some documents at Ex.P1 to P20. One more witness is examined as PW2 and got marked Ex.P21 to P43.
6. The Company Secretary and Authorized Signatory of the defendant company is examined as DW1 and got marked documents at Ex.D1 to D8. One more witness is examined as DW2.
7. Heard the learned counsel for the plaintiff. The learned counsel for the defendant has filed written arguments.
8. My findings on the above issues are:
Issue No.1: Partly in the affirmative Issue No.2: In the affirmative Issue No.3: In the negative Issue No.4: Already held in negative on 11.07.2013 Issue No.5: Partly in the affirmative Issue No.6: As per the final order for the following 21 Com.O.S.No.6411/2011 REASONS
9. Issue Nos.1 to 3: The burden of proving these Issues lies on the plaintiff company. The Chairman / Managing Director of the plaintiff company has filed his affidavit and he is examined as PW1. He has narrated the contents of the plaint in his affidavit. He has produced some documents at Ex.P1 to P20 i.e. Board Resolution, notarized copy of the Agreement, certified copy of the petition in A.S.No.15002/2003, certified copy of the order sheet in A.S.No.15003/2003, certified copy of the petition and decree in A.S.No.15002/2003, statement of account of the defendant maintained by the plaintiff from 01.04.2001 to 31.03.2002, letters dated 08.01.2010 and 03.03.2010, 09.03.2010, copy of the notice, postal documents, reply by the defendant, certified copy of the company petition No.419/2010, reply by the defendant, certified copy of the rejoinder by the defendant, certificate copy of the judgment in C.P.No.419/2020, certified copy of the Appeal in Com.Appl. No.275/2010.
10. In the cross examination of PW1, it is forthcoming that the plaintiff company was established in the year 1997. There were Three Directors and he is the MD. In pursuance of the work order dated 01.06.1999, the service of the plaintiff was engaged as sub-contractor to carry out the works of improvement of Arterial and Sub-arterial roads in Bengaluru City. The plaintiff has to carry out the works in accordance with the terms and conditions of the work order. After signing the work order, the plaintiff company started to carry out the work. The work order is 22 Com.O.S.No.6411/2011 dated 17.11.1999 and not 01.06.1999. He has denied that, they had given Two work orders on 01.06.1999 and 17.11.1999. He identified his signatures on Ex.D7(a) to (g). Ex.D7 is the work order dated 01.06.1999. He has admitted that he has prepared bills as per the work order dated 01.06.1999. The PW1 has answered a question thrown to him that, "You have prepare bills for having carried out the works 01.06.1999 to 16.11.1999 in accordance of work order dated 01.06.1999?" The Answer given is "There is no work order dated 01.06.1999".
11. In the further cross examination, he has further deposed that, in accordance with work order dated 01.06.1999, bills were raised. He has produced all the 15 bills raised for the work done from 01.06.1999 to 16.11.1999. He has admitted that, he has not produced these bills, but, produced a statement containing all the 15 bills. He does not remember the exact amount of work done by the plaintiff company from 01.06.1999 to 16.11.1999. Even he does not remember how much amount was paid by the defendant during this period and even he does not know how much amount is due from the defendant for the said work. As per Ex.P7 the amount was due from the defendant for the work done by the plaintiff company from 01.06.1999 to 16.11.1999. The Ex.P7 was sent by the defendant on 01.04.2001. He has also produced a copy of account statement which was produced in CP No.419/2010 before the Hon'ble High Court. The plaintiff company has not sent legal notice to the defendant claiming due amount for the work done from 23 Com.O.S.No.6411/2011 01.06.1999 to 16.11.1999. But, the plaintiff has sent a letter as per Ex.P9 and P10. The plaintiff company has not signed another work order dated 17.11.1999 with the defendant. He again said that, they have signed work order dated 17.11.1999, it is in Ex.D8. He has admitted his signatures on Ex.D8(a) to (f). He has admitted that, the plaintiff company has to carry out the work as per the terms and conditions of Ex.D8 and the plaintiff has to raise bills as per Ex.D8. He has admitted that, as per Clause No.7 of Ex.D8, the plaintiff has to raise the bills for the work carried out earlier to 16.11.1999 as per the work order dated 01.06.1999. As per Clause No.7 of Ex.D8, the plaintiff agreed to transfer if any bills were pending for the work done earlier to 16.11.1999.
12. In the further cross examination, it is forthcoming that, he has admitted that, in Ex.P7 all the work carried out by the plaintiff company from 01.06.1999 to 16.11.1999 are not revealed. The Ex.P8 and P9 do not disclose the amount due as per the work order dated 01.06.1999. The plaintiff has not disclosed in the Company Petition filed before the Hon'ble High Court of Bombay with regard to the existence of the work order dated 01.06.1999. The defendant has not admitted the due of Rs.3,43,42,108/- in any document. He does not know whether any documents to show that the defendant is due of Rs.3,43,42,108/-. He has denied that, the defendant has supplied the bitumen and equipments for carrying out the work. The work of 16th bill was commenced in 2000 and it was 24 Com.O.S.No.6411/2011 completed in the year 2001. The first payment with regard to RA bill Nos.1 to 15 was made on 01.06.1999, last payment pertaining to these bills was made in the year 2001. The bill for Rs.16,98,18,008/- was raised in the year 2001. This is the total bill for RA bill Nos.1 to 15. He has admitted that, out of the said amount, the defendant has paid an amount of Rs.13,64,75,899/- upto the year 2001 in installments. The plaintiff company had not issued any notice to the defendant claiming remaining amount of Rs.3,43,42,108/- in the year 2001. He has admitted that, there is no clause in Ex.D7 that 75% of the amount payable by BMP to the defendant is to be paid to the plaintiff. He further deposed that, as per the work order dated 17.11.1999, 75% of the amount payable by BMP to the defendant is to be paid to the plaintiff company. As per Clause No.VII of Ex.D8, 75% of the amount pertaining to the work order carried out after 16.11.1999 to be payable by BMP to the defendant is to be paid to the plaintiff.
13. It is further forthcoming that he has admitted that, in page No.131 to 136, the details of RA bill No.16 is not mentioned. The plaintiff has submitted 16 th bill for Rs.1.82 Crores and Rs.1.00 Crore was paid in the company petition before the Hon'ble High Court of Bombay. As per the Agreement in Ex.D8, the plaintiff has to receive 75% of the amount payable to BMP to defendant and the plaintiff claimed Rs.27,55,92,150/-. The plaintiff company has carried out Three package work to BMP from 1997 worth of Rs.27.00 Crores to BMP in Infrastructure Pvt.
25 Com.O.S.No.6411/2011Ltd. He has not produced documents to show regarding the meetings held between 02.04.1999, 24.06.1999 and 18.11.1999.
14. In the further cross examination, the bitumen will be used to Tar Road formation. The bitumen is not required to carry out civil work. The plaintiff will get supply the bitumen and it is not involved in manufacture, sale or supply of bitumen and the plaintiff will procure the bitumen from Mangalore Refineries. The plaintiff carried out bitumen work and civil work and RA bill Nos.1 to 15 have been raised. The item of bitumen was supplied by the defendant to the plaintiff to carry out the work involved in RA bill Nos.1 to 15. He has denied that, out of the amount paid by BMP, the entire amount pertaining to the bitumen will be paid to the defendant. He has admitted that, as per Clause 3.1 of Ex.D7, the entire amount of bitumen will be paid to the defendant by BMP. He further deposed that, as per another subsequent work order, 75% of the amount is to be paid to the plaintiff company and only 25% is to be paid to the defendant out of the bitumen amount. He has admitted that the work involved under RA bill Nos.1 to 15 have been made in pursuance of Ex.D7. He has admitted that, in Schedule A of Ex.D7, the details are mentioned as to under what head the amounts are to be claimed in the bills and also admitted that, as per Ex.D7 for the works carried out, the plaintiff is not entitled for 75% of the amount paid by BMP. He has not produced any bills or receipts for having purchased any bitumen. Also not produced any statement for having purchased bituminous to carry out the work shown in Ex.D7 26 Com.O.S.No.6411/2011 and D8. Bitumen work was also involved in RA bill No.16. He has also admitted that, all the bitumen works required for the work were supplied by the defendant. He has also admitted that, as per Clause No.6.4 of Ex.D8 if any machineries, plants or vehicles supplied by the defendant, the defendant is entitled to deduct the amount for having supplied the same and also admitted, as per Clause No.2 of Ex.D8, if any bitumen are supplied by the defendant, the defendant is entitled to deduct the amount. He has further admitted that, after deducting the amount, for having supplied the bitumen, plants, vehicles and machineries, the defendant has to pay the remaining amount.
15. He has also admitted that, as per Clause 5.1 of Ex.D8, the plaintiff has to spend for all the man power, plants and machineries as well as equipment for all the civil works and the plaintiff is not entitled to levy any additional charge for these. The total amount of work carried out under Ex.D7 would come to Rs.3.00 Crores. The defendant has paid the amount of the work carried out under Ex.D7. The pending amount carried out under Ex.D7 has been carried forward in RA bill No.16. He has denied that there is no base for the amount claimed of Rs.27,55,92,150/-. He has also admitted that, apart from the plaintiff company, the defendant has also engaged other sub- contractors for the work and the other sub-contractors have done their entrusted work. He volunteers that, he has made payments to these sub-contractors. The Ex.D7 was entered into between the defendant and S.Jayaram Reddy. The Ex.D8 was entered into 27 Com.O.S.No.6411/2011 between the defendant and the plaintiff. He has denied the other suggestions.
16. The PW2 is a Civil Engineer filed his affidavit in support of the plaintiff's case. He has narrated the plaint averments. He has produced some documents i.e. certified copies of the 15 RA bills, copy of the proceedings of BMP dated 24.06.1999 and they are marked at Ex.P21 to P43.
17. In the cross examination, it is forthcoming that, he joined the plaintiff company in the year 1998, from 2005 to 2010, he had been to Dubai. Once again he joined the plaintiff company from 2010 to March 2013. He does not know the financial transactions of the plaintiff company with the others, other than the defendants. In January 1998 the BMP had entrusted improvement of Arterial roads and sub-arterial roads. The work order worth of Rs.27.00 Crores were entrusted to BMP during 1997 to 1999. He has not produced any document to show that, the plaintiff company has completed the said work and BMP has paid the said amount of Rs.27.00 Crores. Except Ex.P21 (the copy of the proceedings of BMP dated 24.06.1999), the plaintiff has not produced any other document to show that, it had carried out the work under Two work orders. He has admitted that, the work order dated 01.06.1999 was not disclosed before the Hon'ble High Court of Mumbai in Company Petition.
28 Com.O.S.No.6411/201118. In the further cross examination, it is forthcoming that, he has admitted that, as per work order dated 01.06.1999, the plaintiff is not entitled to claim 75% of the amount payable by the BMP to the defendant. As per the said work order, the work carried out by Jayaram Reddy or plaintiff, they are not entitled to seek 75% of the amount. As per the first work order, Jayaram Reddy had completed part of the road only, to the tune of Rs.4.00 Crores and raised the bills. They used to purchase bitumen from Mangalore Hindustan Petroleum and Chemicals Ltd. About One and half years, the defendant supplied bitumen mix to the plaintiff. He has also admitted that, the cost of the bitumen supplied by the defendant to the plaintiff company was to be deducted out of the amount paid by BMP. The plaintiff has not produced documents to substantiate that the defendant is in due of Rs.27,55,92,150/-. He has denied the other suggestions.
19. The DW1 who is the Company Secretary of the defendant examined, he has filed his affidavit and produced some documents at Ex.D1 to D8 i.e. copy of the Resolution, certificates of Incorporation, Form No.18, work order dated 01.06.1999 and 17.11.1999. He is cross examined, wherein it is forthcoming that, the work was entrusted by BMP. There is no dispute between the defendant and BMP. He is not aware regarding arbitration dispute between the defendant and BMP. Even he does not know regarding the arbitration proceedings. But, he has admitted that the arbitration proceedings held and it was directed in the said proceedings to BMP to pay 29 Com.O.S.No.6411/2011 Rs.21,63,45,437/- plus interest at the rate of 6% to the defendant company. He does not know whether the BMP has challenged the said award. He does not know regarding the proceedings held in A.S.No.15002/2003 and A.S.No.46/2003.
20. Another witness is examined on behalf of the defendant company, he is the Managing Director filed his affidavit. He has not produced any documents.
21. In the cross examination, it is forthcoming that, the defendant company is a reputed public leading infrastructure company and it is registered before Bombay Stock Exchange and National Stock Exchange. The project of arterial and sub-arterial roads in Bengaluru City is an important project for the defendant. It had employed some sub-contractors to this, before employing the plaintiff company. The Ex.D7 was entered into with Jayaram Reddy. He has denied that, the BMP had illegally withheld part of the amount under RA bill Nos.1 to 15. The defendant company had initiated arbitral proceedings. The award passed by the learned Arbitrator was challenged and the awards were confirmed in A.S.No.46/2003. He does no remember whether the BMP has made last installment on 24.09.2010. The Ex.D8 is another work order entered into between the defendant and the plaintiff on 17.11.1999. He has admitted that, as per Clause No.3 and 4.19, the defendant had to pay 75% of the amount of RA bills as and when the amounts were received by BMP. But, the defendant company is entitled to deduct some amount for the materials supplied and machinery given on hire.
30 Com.O.S.No.6411/201122. It is further forthcoming that, according to him, the defendant company had paid all the RA bill Nos.1 to 15 to the tune of Rs.1.73 Crores. In the month of June 2002 after completion of the said work. He is further cross examined after about Nine years. He has admitted that, as per Ex.P2, some third party has also done some work prior to the plaintiff being appointed to do the work. He has denied that, the plaintiff company has settled the claims of the independent contractors. According to him, some of the civil works done by the plaintiff company and bituminous work done by the defendant company. The defendant company supplied bituminous materials. He has also admitted that, the arbitration proceedings covered the subject mentioned in Ex.C1 and C2. According to him, the defendant company has made payments to the plaintiff company, even before the defendant received money from BMP.
23. It is further forthcoming, according to him, other sub- contractors and the defendant had done work, the other sub- contractors have been settled by the defendant company. A portion of the amount paid to the sub-contractor is not paid to the plaintiff company. According to him, the said amount was transferred to the plaintiff's account. He has also deposed that, the defendant had supplied some machineries to the plaintiff company. He has admitted that, the rents payable by the plaintiff has been deducted from the bills payable to the plaintiff company. He has denied the other suggestions.
31 Com.O.S.No.6411/201124. The learned counsel for the plaintiff has submitted his written synopsis basing on the plaint averments, evidence of PW1, PW2, DW1 and DW2 and documents referred above. He has pointed out towards the Agreement between the plaintiff and the defendant companies at Ex.P2. This is the suit document. He has pointed out towards its recitals. The said Agreement has been divided into Two parts i.e. (a) All Civil Works and (b) Bituminous work and it is mentioned in Annexure-1 and 2. Earlier to this, there was another work order dated 01.06.1999. Clause No.1.0 of Ex.P2 reads - "In super-session of our work order number AII/ SUB/x/001/98-99 dated 01 June 1999, we are modifying and revising at your request our said Agreement and revised / modified Agreement has been accepted by the Managing Director for and on behalf of Atlanta Infrastructure Ltd. on the terms and conditions mentioned herein after." As per this, Agreement, the BOQ for all civil works as per our Agreement / contract with BMP along with our quoted rates for each item is attached as Annexure-1. The rates to be paid to you shall be 75% of our quoted rates for each item of work and whenever part rates are paid by BMP for any item, the rates to be paid to you shall be 75% of the part rates paid by BMP. He has further pointed out that this is the main Agreement between the parties. The remaining 25% shall go to the defendant.
25. He has further pointed out towards the other terms and conditions of the contract / Agreement. The work commenced from 01.06.1999 for items as per Annexure-1 shall 32 Com.O.S.No.6411/2011 be progressed vigorously and with diligence so as to complete all BOQ quantities by 31st March 2000. The work on bituminous items shall commence from 17th November 1999 and shall be completed for all BOQ quantities latest by 31 st March 2000, subject to bituminous mix being supplied by Atlanta i.e. the defendant. He has pointed out towards the other clauses also. Time is the essence of the Agreement. This Ex.P2 is the copy of the letter issued by the defendant on 17.11.1999. The learned counsel for the plaintiff also pointed out towards the Clause No.4.19 that "rate analysis for all extra items and variation items (variation items are those items were quantities of items increase more than 30% of BOQ quantities) shall be worked out jointly between both parties before submission to BMP. You shall process the case with BMP for its approval. You shall be paid 75% of the rates as approved by BMP for extra items and variation items for Annexure-1. The plaintiff company commenced the work on various roads as per approved work schedule and complete the same in stipulated time. One of the term in Ex.P2 at Clause 6.4 is "Atlanta may provide at your request the following plant / equipment / vehicle etc. at the rates.....". As per the Agreement, the plaintiff has to provide the minimum plant /equipment / vehicles for execution of the bituminous work like vibrating roller, PTR, static rollers, compressors, tippers, manpower etc.
26. He has further pointed out towards the Clause No.9.0 of the Ex.P2 - "No escalation is payable during the currency of the Agreement. If, however, BMP agrees to pay escalation due to 33 Com.O.S.No.6411/2011 extension of time of completion or for abnormal rise in prices of POL products, the same shall be SJR and Atlanta in proportion of 75:25 for the work covered under Annexure-1 (civil works) and for bitumen escalation for Annexure-1, items of bitumen works. This Ex.P2 is written by DW2 himself. He has pointed out towards the evidence of DW1 and DW2 also.
27. He has pointed out towards the other documents produced on behalf of the plaintiff. There is no dispute regarding the Contract / Agreement between the parties. The defendant company asked the plaintiff to act as a sub-contractor for completion of the project. Hence, the defendant has awarded the contract - Phase-III. There was an Agreement between the plaintiff and the defendant regarding allotment of share of profit in 75:25 ratio. The first work order was issued on 01.06.1999. It is also not in dispute. The defendant has not paid the amount as agreed. As per Clause No.4.7 of Ex.P2, the defendant has to pay an interest at the rate of 18% as damages. Even after completion of the work, as agreed between the parties, the defendant has not paid the amount to the plaintiff.
28. He has further submitted that there was a dispute between the defendant company and BMP - Bangalore Mahanagara Palike regarding the project. The Agreement was, whenever the amount received by the defendant company from BMP regarding this project, the plaintiff is entitled for 75% and remaining 25%, the defendant is entitled. Since there was a dispute between the BMP and the defendant company, as per 34 Com.O.S.No.6411/2011 their terms and conditions arbitration proceedings were held and there was a delay in disposal of the said arbitration proceedings. Therefore, the defendant could not get the amount from the BMP and it has not paid the plaintiff also. There is a delay in making payments from the defendant company, because of arbitration proceedings.
29. He has further pointed out towards the defence made out by the defendant company. The defendant has not made out any counter claim. He has further pointed out towards the Ex.P5 i.e. certified copy of A.S.No.15002/2023 filed by the defendant against BMP U/Sec.34 of the Arbitration and Conciliation Act. The relief sought by the defendant in the said petition was - "Non granting of interest on due amounts upto 16.03.2001 from the date it was due and non granting of compensation for overheads profits and loss of productivity from the machinery and equipment and interest thereof at 18% from 16.03.2001 and non granting of interest at the rate of 18% p.a. and also direction to the respondent to pay on to the petitioner the amounts awarded to the petitioner under the award which amounts to Rs.21,63,45,437/- as on 25.08.2003 as also balance of FSD amounting to Rs.1,06,77,552/- by 01.11.2003." The award has been passed in the said proceedings in the month of August 2009. He has pointed out towards the Ex.P6 also. The Ex.P7 is the ledger account for the period from 01.04.2001 to 31.03.2002 pertaining to the plaintiff company maintained by the defendant.
35 Com.O.S.No.6411/201130. He has further pointed out towards the letter dated 08.01.2010 issued by the defendant company to the plaintiff and as per point No.3.2 it is clearly admitted by the defendant that, "Under the aforesaid circumstances, bill No.16 and final bill of your client submitted by your client on 18.02.2002 is under process and final quantities will be worked out on the basis of bill being processed by Bangalore Mahanagara Palike and after receiving the advances already paid against bill No.16, the final payment will be released after receipt of the payment from Bangalore Mahanagara Palike, which please note". Also pointed out towards Ex.P9 i.e. another letter issued by the defendant company on 01.02.2010, there also it is clearly mentioned that, "the payment from BBMP is expected in February 2010 and therefore you are requested to comply with above refereed requirement so that the payment indicated as per our letter dated 08.01.2010 can be released. At the same time, you are also requested to settle the payment of Atlanta Ltd. for item No.4.09 and 4.10 as stated herein above." He has also drawn my attention towards Ex.P10 i.e. another letter issued by the defendant company on 03.03.2010 wherein it is stated that, "As stated herein above you are only entitled for Rs.1,08,52,362/- after settlement of supply bills, receipt of payment from BBMP and receipt of full and final settlement certificate from your end, which please note." This is suitably replied as per Ex.P11 dated 09.03.2010 by the plaintiff company.
36 Com.O.S.No.6411/201131. He has further submitted that the defendant company has not cleared the pending bills of the plaintiff company for carrying out the work of the project as agreed. He has further pointed out towards the Ex.P12 i.e. the notice issued to the defendant on 04.06.2010, wherein it is clearly brought to the notice of the defendant company regarding the arbitral proceedings, award dated 22.03.2003 and additional award dated 31.05.2003 and direction to the BMP to pay a sum of Rs.21,63,45,437/- to the defendant company with interest at the rate of 6% for the works carried out by plaintiff company, as well as the common order / judgment passed in A.S.No.46/2003 and A.S.No.15002/2003 by the learned 6th Addl. City Civil Judge, Bangalore on 11.08.2009. It was also brought to the notice of the defendant company that, "the Municipal Corporation submitted to and accepted the common order / judgment dated 11.08.2009 and accordingly, paid to you a sum of Rs.28,73,52,780/- in Three installments i.e. Rs.9,57,84,261/- each on 04.12.2009, 20.03.2010 and 30.03.2010." As on the date of this reply dated 04.06.2010, the defendant company was in due of Rs.22,05,12,492/- together with interest at 18% and future interest at 18% till payment, which is 75% of the share as agreed between the parties.
32. He has drawn my attention towards the cross examination of DW2 wherein he has deposed in his examination in chief that, "the plaintiff would be entitled to claim for 75% of the amount for the roads entrusted to the plaintiff and as paid by 37 Com.O.S.No.6411/2011 Bangalore Mahanagara Palike under Annexure-I and II subject to deductions towards the bituminous, mixes and machineries supplied by the defendant". In his cross examination, a question was thrown to him that, "as per Clause 3 and 4.19, the defendant had to pay 75% of the amount of bills as and when the amount were received by the BBMP? He answered "Yes, but, the defendant company is entitled to deduct some amount for the materials supplied and machinery given on hire." He has further clarified that, the defendant company has not clarified regarding the amount to be deducted for the materials supplied and machinery given on hire base. Even the defendant company allotted the sub-contract work in regard to only some roads but, it is also not clarified, as per the defence of the defendant. The defendant company has not produced documents regarding its entitlement for deduction under RA bill No.16. The defendant admitted that the plaintiff had carried out the work under RA bill No.16, but, the defendant is entitled to make some deductions which is not clarified.
33. He has further pointed out towards the cross examination of DW2 on 16.02.2024, he has deposed that, "Now I do not have any document to show that the defendant made payment to the plaintiff. It is more than 15 to 20 years, hence, the said documents are destroyed. He has further deposed that, "now I do not have any documents to show that the defendants has done any work."
38 Com.O.S.No.6411/201134. He has also drawn my attention towards the judgment passed by the Hon'ble High Court of Karnataka in W.P.No.24834/2015 dated 19.10.2022 that, "the petitioner (defendant) who has received certain amounts on culmination of the arbitral proceedings, cannot deny the custody and possession of the aforesaid awards and in fact, it is now stated that, the copies of these awards can be produced. The Hon'ble High Court of Judicature Bombay in its judgment dated 07.04.2011 as per Ex.P19 held that, "The award does not bifurcate the amount awarded in favour of the respondent under each of the heads".
35. He has also pointed out towards the Ex.P21 to P43, the Ex.P22 to P43 are the certified copies of the RA bill Nos.1 to 13.
36. He has further submitted that, there were several letter correspondences between the parties. He has pointed out towards the Ex.P15 i.e. the legal notice issued on behalf of the defendant company dated 19.07.2010, wherein it is stated that, the plaintiff company is entitled to Rs.1,08,52,362/- subject to settlement of supply bill amounting to Rs.73,96,826/- by the defendant company in terms of the Agreement entered into and the plaintiff company is not entitled for the amount of Rs.22,05,12,492/- and the plaintiff company is entitled for the said amount only after the receipt of the amount made by BBMP to the defendant.
39 Com.O.S.No.6411/201137. He has also drawn my attention towards Ex.P16 i.e. the copy of the Company Petition No.419/2010 before the Hon'ble High Court of Judicature at Bombay filed by the plaintiff company against the defendant and it was disposed of on 07.04.2011. The defendant preferred an Appeal No.275/2011. During the pendency of the appeal, the defendant in compliance with the order / judgment dated 07.04.2011 in Company Petition No.419/2010 deposited a sum of Rs.1.00 Crore before the Appellate Court. The appeal came to be disposed of on 08.05.2011 with a permission to the plaintiff company to withdraw a sum of Rs.80.00 lakhs out of the said Rs.1.00 Crore. The remaining sum of Rs.20.00 lakhs be transferred to this suit. He has further pointed out that, the appellate court upheld the order of the learned Single Judge in Company Petition No.419/2010 and permitted the plaintiff to file a suit for recovery of the balance claim amount. He has pointed out towards the Ex.P17 i.e. the copy of the Company Petition No.419/2010 filed by DW2 and the Ex.P18 is the affidavit in Counter rejoinder filed by PW1 on 03.03.2011. The Ex.P19 is the order passed by the Hon'ble High Court of Judicature at Bombay in Company Petition No.419/2010 wherein the petition was disposed of by passing an order - "(i) In the event of the respondent-company paying the petitioner a sum of Rs.1.00 Crore on or before 31.05.2011, the Company Petition shall stand dismissed. Even in the event of the amount being paid, the petitioner shall be at liberty to adopt any proceeding for further reliefs including further interest and shall also be entitled to adjust the amounts paid first towards 40 Com.O.S.No.6411/2011 interest." He has also pointed out towards the Ex.P20 also i.e. the certified copy of the orders passed in Appeal No.275/2011 arising out of Company Ptn. No.419/2010 and it was disposed of on 08.06.2011. Hence, the plaintiff company has filed this suit and it is in time.
38. He has further pointed out towards the provisions of Sec.114 of Evidence Act and Article 113 of the Limitation Act, which reads - "Any suit for which no period of limitation is provided elsewhere in the Schedule - Three years - when the right to sue accrues". In respect of interest on the delayed payments is concerned, he has submitted that, the plaintiff company is entitled to interest on delayed payments, admittedly, the defendant company received payments from 04.12.2009 and 24.09.2010. The plaintiff company was charged at 2.25% p.m. on the sums advanced. The transaction being a commercial transaction, the plaintiff company is entitled for 18% p.a. on delayed payments. The plaintiff is also entitled for deposit of Rs.20.00 lakhs lying in the suit.
39. Per contra, the learned counsel for the defendant has submitted her written arguments and she has pointed out towards the defense made by the defendant and the documents produced on behalf of the defendant and also drawn my attention towards the evidence of the witnesses of both sides and also facts of the case. She has also drawn my attention towards the documents produced on behalf of the plaintiff company. It is admitted that, the plaintiff company was appointed for carrying 41 Com.O.S.No.6411/2011 on part of the work as sub-contractor. There were Two work orders entered into dated 01.06.1999 (Ex.D7) and 17.11.1999 (Ex.P2). These contained the detailed work to be carried out by the plaintiff company. She has also pointed out towards the clause No.6.2, 6.3, 6.4, 6.6 and 6.7 of Ex.P2 as well as Clause No.5.1, 5.2, 4.1 of Ex.P2. The plaintiff's responsibility was to transport the hot-mix bituminous materials from the defendant's plant to work site, the mutual work of cleaning road, GSB surface, applying prime quote, track quote, laying of bituminous mixes and its compaction as per design and specification was to be done, civil works for some of the roads as a sub-contractor. There was slight modification as per the understanding between the parties, the second work order was executed. The plaintiff company for execution of civil work would be entitled to 75% of the quoted rates for each item of work, the work as per the BOQ and bituminous items ought to be completed within 31.03.2000, the defendant company agreed to provide the entire bitumen, bituminous mixes, transportation, plant and equipment to the plaintiff at the rates stipulated therein.
40. She has further submitted that, the scope of the work remained the same as per these annexures and the plaintiff's scope of work never extended to the entire project. The plaintiff company regularly raised bills for the work it carried out on the Corporation directly. The corporation audited, certified and paid the said bills to the plaintiff company. The entitlement of the plaintiff, in respect of the amounts claimed under RA 15 bills till 42 Com.O.S.No.6411/2011 07.09.2001 were based on the work executed by the plaintiff and the deductions which the defendant was entitled to for the supplies made to the plaintiff. The net amount regarding 15 RA bills after adjusting recovery towards is a sum of Rs.14,09,741/- and after deducting the TDS of Rs.71,718/-, the total amount payable is Rs.13,38,073/- which was paid by the defendant to the plaintiff on adhoc basis Rs.12.00 lakhs by way of cheque dated 26.09.2001. Hence, the claim of the plaintiff company in respect of 15 RA bills were duly settled irrespective of the pending dues which the Corporation owed to the defendant and that the plaintiff having unconditionally accepted the payment out of its own will and consent. The matter had attained finality on the date of the payment.
41. It is further stated that on completion of the work, the defendant submitted RA 16 bill to Corporation for payment of Rs.2,14,03,960/- on 29.04.2002 and it was certified by the Corporation for Rs.2,05,16,843/-. But, the payments of the same were not made by the Corporation. The entitlement of the plaintiff company in respect of the amounts claimed by the defendant under the above RA 16 bill were based on the works executed by them and the deductions which the defendant was entitled to for the supplies, it is pleaded in para No.17 of the written statement. Owing to the Corporation failing to make payments to the defendant company, which were entirely separate from the plaintiff's bills. Arbitration proceedings came to be initiated by the defendant company against the Corporation -
43 Com.O.S.No.6411/2011BMP. After hearing the parties, the learned Arbitrator passed an award on 22.03.2003 and subsequent award on 31.05.2003 partly allowing the claim made by the defendant directed the Corporation to pay a sum of Rs.19,40,01,889/- along with interest and costs. It is mentioned in Ex.C1 and C2. The award was challenged in A.S.No.15002/2003 came to be rejected and the Corporation - BMP made payments to the defendant in terms of the award. At no point during this time did the plaintiff raise any claims towards the dues either against the defendant or the Corporation. Thereafter, the plaintiff started raising frivolous and malafide claims making illegal gain only on the basis of the amount awarded in favour of the defendant in arbitral proceedings. The plaintiff filed a false suit against the defendant for winding up before the Hon'ble High Court of Bombay and the petition was dismissed after deposit of Rs.1.00 Crore by the defendant. Later, the plaintiff filed this suit claiming Rs.27,55,92,150/- after 11 years.
42. She has further submitted that, IA No.24 was filed by the plaintiff and it came to be rejected by this court on 03.07.2024. The issues framed in this suit on 03.12.2012 itself. The plaintiff wants to shift the burden of proving the Issues mentioned in the IA No.24 on the defendant. While recording the submission the order incompletely records, "the burden of the Issues mentioned in the application lies on the defendant. This is not a finding given by this court or submission for the defendant. The order passed on IA No.24 is not challenged. The plaintiff 44 Com.O.S.No.6411/2011 cannot seek to put the burden on the defendant owing to one errant sentence when IA No.24 is entirely rejected. Now the plaintiff is attempting to rely on a misreading of the order and at best a typographical error to mislead the court.
43. In regard to documents, she has pointed out that, there is no direction to the defendant to produce 17 documents, in the order passed on 19.10.2022 in W.P.No.24834/2015 which is modified on 13.04.2015. The plaintiff's attempt to mis-quote the order to make it read as, "though the defendant was directed to produce all 17 documents is condemable". The plaintiff filed an application seeking to have these documents summoned by the Corporation by filing IA No.17, but, all the relevant records were produced in A.S.No.46/2003 and the records of the said proceedings have been summoned by this court. But, the plaintiff choose not to rely on any of these records, but, blaming the defendant for suppressing the documents. The burden of proof lies on the plaintiff company and it has failed to produce any iota of documents to support these issues.
44. In regard to contract between the parties - work orders executed between the parties dated 01.06.1999 and 17.11.1999. The plaintiff company has not produced any annexures to work order-II. The scope of the work as per Annexures to work order-I, is therefore, the only scope of work that was allotted to the plaintiff. As per clause No.3 of work order-II, the plaintiff was entitled to 75% of the quoted rates. The plaintiff's attempt to claim the 75% of the total amount billed 45 Com.O.S.No.6411/2011 for all of the defendant's work is well beyond the contract. The PW1 has admitted that there were other sub-contractors appointed by the defendant other than itself, confirming that only a part of the work was to be performed by the plaintiff company. The plaintiff has suppressed the work order-I in the plaint and has all along relied on Clause No.3 of work order-II to claim its purported dues. The PW1 changed his versions during his cross examination, it is also observed by the court. The PW1 attempts during the cross examination and through PW2 and to claim that the work order-I was given to Jayaram Reddy in his personal capacity and work order-II was issued in the name of the plaintiff. However, this is belied by the fact that both the work orders referred to one another. Both work orders for the same work and the ledger statement relied upon by the plaintiff at Ex.P16 which indicates that the ledger statement for the period of work order-I and work order-II are both carried in the same name.
45. The plaintiff company has failed to prove its claim, its claim is based on the payment made to the defendant. The plaintiff has not independently shown any material to prove its entitlement to be paid the amount as sought in the suit. But, the entire claim is based on Clause No.3 of work order-II by which the plaintiff is purportedly to be given 75% of the amount paid to the defendant. The plaintiff has ignored all other provisions. She has pointed out towards the Clause No.4.15, 4.18 of work order-II. The PW1 has admitted that the bills have to be raised 46 Com.O.S.No.6411/2011 for any work that has been done. Therefore, as per the work order-II and for work done the plaintiff had to raise invoices. But, no invoices have been produced by the plaintiff. The only documents produced by the plaintiff towards invoices are at Ex.P22 to P43. These are the invoices certified by the BMP. The total amount approved and paid by the Corporation seal on the invoices, is a sum of Rs.12,42,400/-. It appears to be unpaid. The plaintiff has failed to demonstrate by producing any evidence that Rs.27,55,92,150/- is due and payable to it. She has also pointed out towards the other proceedings in Company Petition No.419/2010 - Ex.P16. It shows a purported outstanding after RA bill No.13 is only Rs.3,43,42,109/-. This is contradictory to the invoices produced by the plaintiff itself. This is not anywhere close to the claim sought in the suit. She has pointed out towards the claims made in notices dated 05.01.2010 it is Rs.6,27,53,463/-, letter dated 16.02.2010 and 09.03.2010 wherein amount is not mentioned. Letter dated 14.06.2010 it is Rs.22,05,12,492/-. Till 18.02.2002, the plaintiff had raised a claim towards RA bill Nos.1 to 16 is Rs.1,72,01,061/- and in January 2020 claimed Rs.6,27,53,463/-. Without any base, within few months in 2010, the claim increased to Rs.22,05,12,492/- and thereafter, Rs.27,55,92,150/- that is in the present suit.
46. She has further submitted that, the arbitral award is irrelevant. The awards are for the claims made by the defendant company against the Corporation - BMP for variation in price of bitumen, refund of illegal and wrongful recovered, balance 47 Com.O.S.No.6411/2011 payments towards defendant's RA bills and release of retention money, securities etc., which were deposited by the defendant company. This is entirely outside the scope of the work or claims of the plaintiff and has nothing to do with the plaintiff company.
47. In regard to limitation is concerned, she has pointed out that, as per work order-II was to be completed by 31.03.2000, the last bill by the plaintiff company was raised in 2001. The suit is filed after 11 years. Hence, it is barred by limitation. The plaintiff has wrongly placed reliance on the winding up proceedings for the cause of action. Winding up proceedings are not money recovery suits and can never save or stop limitation from running. Hence, the suit is barred by limitation. The plaintiff has filed malafide suit, which is not maintainable, barred by law. Hence, the suit ought to be dismissed with costs.
48. During her arguments, he has relied upon the following decisions reported in -ILR 1987 KAR 2364 in SBI Vs Hegde and Golay Ltd., 2012 Del 380 in Decor India Pvt. Ltd. Vs Delhi Stock Exchange Association Ltd. and (2014) SCC Online Del 19 in Municipal Corporation of Delhi Vs M/s Gurabachan Singh & Sons.
49. After going through the written synopsis submitted on behalf the plaintiff and written arguments submitted on behalf the defendant and also gone through the evidence of the witnesses and pleadings of the parties. Some of the facts are 48 Com.O.S.No.6411/2011 undisputed between the parties, they are Agreement / Contract by way of work orders dated 01.06.1999 and 17.11.1999, the plaintiff company is a sub-contractor under the defendant, the BMP entered into a contract with the defendant company on 03.12.1998 for improvement of arterial roads and sub-arterial roads in Bangalore city, Package-III and the ratio of profit is 75:25. It is also another admitted fact that, as per the orders passed by the Hon'ble High Court of Judicature, Bombay, an amount of Rs.1.00 Crore was deposited by the defendant company and as per the orders the plaintiff company has got released the Rs.80.00 lakhs. The remaining Rs.20.00 lakhs lies in the court.
50. As per the say of the plaintiff company, the defendant accordingly engaged the plaintiff company as sub-contractor to execute all the works i.e. bituminous as well as civil works under the contract. But, it is denied by the defendant by saying that, the plaintiff company is entitled for the amount of profit though it is 75% but, only towards civil works and not bituminous work. The say of the defendant is that, the defendant supplied the bituminous and bituminous mix to the plaintiff company to carry out the project.
51. The main claim of the plaintiff company is that, the plaintiff jointly with the defendant prepared 15 RA bills amounting to Rs.49,04,88,160/- and were submitted to BMP by the defendant. The said amount includes Rs.43,55,426/- paid to the petty contractors for works done by them before the plaintiff 49 Com.O.S.No.6411/2011 commenced the work as sub-contractor, the cost of bitumen and rentals of certain equipment as well as the works carried out by the plaintiff. The BMP on receipt of the said claim under these 15 RA bills, approved and sanctioned payment of only Rs.34,85,50,180/-. The BMP illegally withheld the payments executed by the plaintiff regarding price variation of bituminous etc. The defendant company received part payments of Rs.34,85,50,180/-. It is also the case of the plaintiff company that, as per the assurance given by the defendant, the plaintiff is entitled for 75% of the outstanding amounts under each of the RA bill, as and when received by the defendant from BMP. As per the Agreement dated 17.11.1999, the defendant was bound and liable to pay Rs.26,14,12,635/- being 75% of total amount receivable by the defendant from BMP minus deductions towards the cost of bitumen and rentals of some equipment. After deductions, the defendant was liable to pay an amount of Rs.16,98,18,008/-. But, the defendant paid only sum of Rs.13,64,75,899/- and the balance is Rs.3,43,42,108/- along with the payment of 16th RA bill.
52. As per the plaintiff, it has completed the entire work in November 2001. The defendant did not submit 16 th RA bill to the BMP and did not prepare any further RA bill for the work done by the plaintiff company. It is the case of the plaintiff also that, the defendant company had received part payment from BMP on 04.12.2009 to the tune of Rs.6,27,53,463/-, but, the defendant company had not paid the claim of the plaintiff in the said 50 Com.O.S.No.6411/2011 amount. An Arbitrator was appointed to settle the dispute arose between the defendant and BMP and he passed an award on 22.03.2003 and 31.05.2003 for Rs.21,63,45,437/-. The defendant company has issued a letter on 05.10.2010 and it remained silent about the amount of Rs.28,73,52,780/- received / receivable from the BMP and falsely alleged that only Rs.1,08,52,362/- was payable to the plaintiff in full and final settlement of the dues under 16th RA and final bill after deducting the payment of item No.4.07. This is disputed by the plaintiff company.
53. The plaintiff company herein claimed the amount in pursuance of the awards passed by the sole Arbitrator in the A.S. proceedings, the BMP paid an amount of Rs.28,73,52,780/-. The say of the plaintiff as stated supra, it has carried out the work and the said amount has been released by the BMP to the defendant i.e. Rs.13,08,29,200/- towards the unpaid sums under RA bill Nos.1 to 15 plus RA bill No.16, Rs.3,38,93,150/- towards price variation of bitumen. Rs.5.00 lakhs towards penalty, Rs.9,28,356/- refundable interest, Rs.1,06,77,852/- towards refund of security deposit, Rs.1,71,73,330/- towards compensation and interest 6% and also cost of Rs.16.00 lakhs.
54. The documents produced for the plaintiff are, Ex.P1 is the Board Resolution, Ex.P2 is the copy of the Agreement/ Contract dated 17.11.1999, Ex.P3 is the copy of the objections in A.S.No.15002/2003, Ex.P4 is the order sheet in the said A.S.No.15002/2003, Ex.P5 is the copy of the petition in 51 Com.O.S.No.6411/2011 A.S.No.15002/2003, Ex.P6 is the award passed in A.S.No.15002/2003, Ex.P7 is the ledger account, Ex.P8 to P10 are the letters issued by the defendant company dated 08.01.2010, 01.02.2010 and 03.03.2010. Ex.P11 is the copy of the letter issued by the plaintiff dated 09.03.2010, Ex.P12 is the reply by the defendant dated 04.06.2010, Ex.P13 and P14 are the postal documents, the Ex.P15 is the legal notice issued on behalf of the defendant dated 19.07.2010, Ex.P16 is the copy of the proceedings in C.P.No.419/2010 containing petition and annexures, Ex.P17 is the reply of the defendant to the said C.P., Ex.P18 is the copy of the affidavit in rejoinder by the PW1, Ex.P19 is the certified copy of the orders passed in C.P.No.419/2010 by the Hon'ble High Court of Judicature at Bombay and Ex.P20 is the orders passed in Appeal No.275/2011 (in C.P.No.419/2020), Ex.P21 is the copy of the proceedings of BMP dated 24.06.1999 and Ex.P22 to P43 are the copies of RA bill Nos.1 to P13.
55. The documents produced on behalf of the above side referred above are, Ex.D1 is the copy of the Board Resolution, Ex.D2 is the Certificate of Incorporation, Ex.D3 is the fresh certificate of Incorporation, Ex.D4 is the fresh certificate of Incorporation for the year 2004, Ex.D5 and D6 are the copies of the Form No.18 pertaining to defendant company, Ex.D7 is the letter by the defendant to the plaintiff dated 01.06.1999 along with the copy of work order dated 01.06.1999, Ex.D8 is the copy of the work order dated 17.11.1999.
52 Com.O.S.No.6411/201156. After going through these documents and evidence referred above, there were Two work orders dated 01.06.1999 and 17.11.1999. After perusing the conditions mentioned in the work order dated 01.06.1999, as per Clause No.3.10 which reads that, "the Project Manager will supply the following to you for incorporating in the works at the rates supplied below for which recoveries shall be made immediately from monthly bills -
(a) Bituminous Macadam, (b) Dense Bituminous Macadam, (c) Bitumen Concrete. The PW1 has admitted the terms and conditions mentioned in this work order during his cross examination, even he has admitted his signature on Ex.D7 - Ex.D7(a). It shows that the plaintiff has agreed that, the terms and conditions mentioned referred above. The supply of bitumen and bituminous macadam is to be supplied by the defendant company itself. The amount will be deducted from monthly bills. I am of the opinion that there is no dispute. But, the plaintiff has raised some quarry that the bitumen and bituminous mix is supplied by the plaintiff itself for carrying out the project. But, no documents have been produced on behalf of the plaintiff to show this fact.
57. The Ex.D8 and Ex.P2 are one and the same. Here also supply of bituminous is not in dispute. It is argued on behalf of the plaintiff company that, the Agreement is for all civil works and bituminous works. But, it is disputed by the defendant company by saying that, bituminous was supplied by the defendant. As stated supra, the DW2 has categorically admitted 53 Com.O.S.No.6411/2011 during his cross examination, he does not have any documents to show that the defendant has done any work. The defendant has supplied some machineries to the plaintiff and the rents payable by the plaintiff has been deducted from the bills payable to the plaintiff. Here also there is no dispute, more over it is clearly mentioned in Clause No.3.1 of Ex.D7. The Clause No.6.3 of Ex.D8 that, "You shall be responsible for transporting of mixes from our plant site to work site, cleaning road / GSB surface, applying prime coat, track coat, lying of bituminous mixes and its compaction as per design and specifications. You shall provide at your cost and expense all man power, plant, machines, equipment, vehicles, etc. for executing this work."
58. After going through the records and materials on record, it is also an admitted fact that, as and when the work completed in part, the defendant company had made part payments. Now the plaintiff company claims the amount referred above after passing the award by the learned Arbitrator.
59. There was a dispute between BMP and the defendant company and the matter was referred to an Arbitrator and he has passed award on 22.03.2003 and 31.05.2003. Both the parties therein i.e. BMP as well as the defendant company have challenged the award, by filing A.S.No.46/2003 by BMP and A.S.No.15002/2003 filed by the defendant herein. After going through the contents of Ex.P5 i.e. the petition U/Sec.34 of Arbitration and Conciliation Act filed by the defendant herein that, "the 1st respondent (BMP) is liable to make payment for a 54 Com.O.S.No.6411/2011 sum of Rs.21,63,45,437/- as on 25 th August 2003 plus balance 50% of FSD amounting to Rs.1,06,77,852/- shall also be payable by 01.11.2003 as awarded in para 74 of the award." It is also prayer sought in the said petition with other reliefs.
60. A common judgment has been passed on 11.08.2009 by the learned Addl. City Civil Judge, Bengaluru. He has dismissed both the suits filed by the parties U/Sec.34 of Arbitration and Conciliation Act. The award dated 22.03.2003 and additional award dated 31.05.2003 passed by the learned Arbitrator were confirmed.
61. As per the Agreement between the parties to this instant suit, as and when received by the defendant from BMP. Clause No.3.0 of Ex.D8 (Ex.P2) is clear that the rates to be paid to you shall be 75% of our quoted rates for each item of work and whenever part rates are paid by BMP for any item, the rates to be paid to you shall be 75% of the part rates paid by BMP. Now the plaintiff company claims the amount as awarded by the learned Arbitrator in the claim petition, which is confirmed by the learned Addl. City Civil Judge, in the year 2009.
62. Subsequent to that, the plaintiff herein has filed a Company Petition No.419/2010 before the Hon'ble High Court of Judicature at Bombay for winding up of Atlanta company. After perusing the contents, it shows that, "on or about 3 rd December 1998, the Bruhath Bangalore Mahanagara Palika entered into a contract with the respondent company for improvement of 55 Com.O.S.No.6411/2011 arterial roads, sub-arterial roads in Bangalore city, package-III South. Pursuant to the said Agreement, the BMP had paid to the respondent company a mobilization advance of Rs.2.43 Crores. It is also shows regarding the work orders dated 17.11.1999 and mode of payments in the ratio of 75:25 as and when payment received by the defendant from BMP. Also mentioned regarding the award and additional award passed by the learned Arbitrator in favour of the defendant company to the tune of Rs.21,63,45,437/- with future interest at the rate of 6%. Also mentioned regarding the letter correspondences between the parties as well as part payment regarding RA bill Nos.1 to 15 and also RA bill No.16 and the confirmation of the awards by the learned Addl. City Civil Judge, Bengaluru etc. It shows that, the Company Petition is filed against the defendant herein in respect of the work orders referred above.
63. Order has been passed by the Hon'ble High Court of Judicature, Bombay as per Ex.P19 on 07.04.2011. It shows the contract between the parties for a total amount about Rs.48.00 Crores, clause 3, 4.19, 6.6 and 9 of the Contract.
Clause No.3.0 reads - Civil Works - Annexure 1 : "The BOQ for all civil works as per our Contract Agreement with Bangalore Mahanagara Palika (hereinafter referred as BMP) along with our quoted rates for each item is attached as Annexure-1. The rates to be paid to you shall be 75% of our quoted rates for each item of work and whenever part rates are paid by BMP for any item, the rates to be paid to you shall be 75% of the part rates paid by BMP.
56 Com.O.S.No.6411/2011Clause 4.19 reads - "Rate analysis for all extra items and variation items (variation items are those items were quantities of items increase more than 30% of BOQ quantities) shall be worked out jointly between both parties before submission to BMP. You shall process the case with BMP for its approval. You shall be paid 75% of the rates as approved by BMP for extra items and variation items for Annexure-1."
Clause 6.6 reads - "Escalation plus or minus for the bitumen shall be to the account of Atlanta Infrastructure Ltd. for Annexure-2."
Clause 9.0 reads - "No escalation is payable during the currency of the Agreement. If, however, BMP agrees to pay escalation due to extension of time of completion or for abnormal rise in prices of POL products, the same shall be SJR and Atlanta in proportion of 75:25 for the work covered under Annexure-1 (civil works) and for bitumen escalation for Annexure-1, items of bitumen works."
64. It is also held that, "there is no dispute that, payments were made from time to time by the respondent to the petitioner. The respondent however, states that there is a balance amount payable by the respondent to the petitioner. In this regard, the petitioner relied strongly upon the fact that the arbitration proceedings were initiated by the respondent against the BMP. An award was passed in favour of the respondent in a some of over Rs.28.00 Crores. The petitioner further states that, the award has attained finality and the award was been executed by the respondent. The petitioner therefore, claimed 75% of the amount purportedly on the basis of the above terms and conditions." It is also held that, "in a winding up petition, it is difficult to compute 57 Com.O.S.No.6411/2011 the amount payable. The award does not bifurcate the amount awarded in favour of the respondent under each of the heads. In other words, while awarding the amounts, the learned Arbitrator has not indicated whether they fall within the civil works as per Annexure-1 or bituminous work as per Annexure-2. All amounts towards escalation are not payable by the respondent to the petitioner. It is only those amounts as stipulated in these Annexures that are payable. In a winding up petition, it is not possible to bifurcate these amounts. It would be necessary for the petitioner to adopt appropriate proceeding to compute the amount which are actually payable." It is also held in para No.5 that, "The reliance upon alleged payments based on the confirmation of amounts after 31.03.2001, is not well founded. Payments appear to have been made subsequently. Amount therefor are required to be taken." In para No.6, it is held that, "Mr.Vamshi's contention as regards limitation is not well founded. The cause of action did not arise in favour of the petitioner upon execution of the work alone. The cause of action would also arise upon the respondent's receiving the amounts from the BMP. These amounts were received ultimately only pursuant to the execution of the award. The award was executed only in the year 2009-10. The amounts paid thus, for were only on account. It is also held in para No.7 that, "However, an amount of Rs.1.8 Crores is admittedly due and payable. The only contention raised on behalf of the respondent is that, it must be accepted in full and final satisfaction and subject to certain conditions which are at Exhibit 'M' to the petition."
58 Com.O.S.No.6411/201165. It is also held in para No.8 that, "the respondent cannot withheld the payment of an admitted amount on the grounds that, the petitioner has refused to issue a Certificate of full and final satisfaction. If the amount is admitted, it is bound to be paid." It is also observed in para No.9 that, "it is disputed that, the petitioner is still to furnish the bills of bitumen works allegedly supplied. Even according to the respondent, they are entitled to deduction only about Rs.25 to 30 lakhs on this accounts. The amount was due in February 2010. Thus, even if interest is computed at 12% p.a., an amount of about Rs.1.24 Crores would be payable by 31st May 2011." With these observations, the petition was disposed of by following orders -
"(i) In the event of the Respondent -
Company paying the petitioner a sum of Rs.1 Crore on or before 31st May 2011, the company petition shall stand dismissed.
Even in the event of the amount being paid, the petitioner shall be at liberty to adopt any proceeding for further reliefs including further interest and shall also be entitled to adjust the amounts paid first towards interest.
(ii) In case of failure on the part of the Company to pay the amount as aforesaid the Company Petition shall stand admitted and to be advertised in Free Press Journal, Maharashtra Times and Maharashtra Government Gazette. In that event the Petitioner to deposit an amount of Rs.10,000/- with the Prothonotary and Senior Master of this court within four weeks from the date of default.
(iii) Further in the event of the amount not being paid, as aforesaid, the petitioner shall be entitled to claim the entire amount."
59 Com.O.S.No.6411/201166. Aggrieved by the said order, the respondent therein / defendant herein challenged the order before the Hon'ble Division Bench, by filing Appeal (LODG) No.275/2011 and it is disposed of on 08.06.2011. It is held by the Hon'ble Division Bench that, "8. While disposing of the Appeal we also set aside the observation made by the Company Judge in para No.6 of the impugned order in so far as, the learned Judge has held that the contention of the appellant company as regards limitation is not well founded. We may not be treated to have expressed any opinion and the court before which the petitioning creditor will file the suit shall decide the same in accordance with law without influenced by any observations made in the order of the learned company Judge or in this order".
67. It is also held in para No.10 that, "We also make it clear that it will open to the appellant company to adopt any proceedings for recovery of the amount of Rs.80.00 lakhs permitted to be withdrawn. After withdrawal of Rs.80.00 lakhs as permitted above, the balance amount of Rs.20.00 lakhs shall be transferred to the credit of the suit which the petitioning creditor is going to file for which the certified copy of the plaint will be produced. Till the amount of Rs.80.00 lakhs is withdrawn, the investment of Rs.1.00 Crore in short term deposit shall continue."
68. Therefore, after considering all these proceedings since more than Two decades between the parties, I am of the opinion that since the amount was not paid by the BMP to the defendant herein towards the work carried out as per the 60 Com.O.S.No.6411/2011 Agreement between themselves in the year 1998. Admittedly, the defendant allotted the work to the plaintiff company as a sub-contractor on the terms and conditions of the work orders dated 01.06.1999 and 17.11.1999. The amount was paid by the BMP only after the award as well as the common judgment passed in the aforesaid A.S.Nos.46/2003 and 15002/2003 on 11.08.2009. Even after considering this date also, the suit filed by the plaintiff company is in time.
69. The plaintiff company has sought an amount of Rs.27,55,92,150/- as per the statement of claim and further interest thereon from the date of the suit till the date of decree and further interest at 18% p.a. or at such other rate this court may deem fit from the date of the decree till payment and realization.
70. As per the plaint averments, the payments totaling Rs.28,73,52,783/- made by the BMP to the defendant are pursuant to the awards which clearly direct the corporation to make payment to the defendant in spite of the works carried out by the plaintiff to the tune of Rs.19,56,01,888/- and interest at the rate of 6% from 01.11.2001 till payment. It is also pleaded that, the amounts mentioned as Rs.5.00 lakhs (penalty), Rs.9,28,356/- (towards refundable interest), Rs.1,06,77,852/- (towards refund of security deposit) and Rs.16.00 lakhs (towards costs), these are exclusive amounts should go to the defendant company. It is also pleaded that, the defendant is liable to pay the plaintiff company 75% of the remaining amounts of 61 Com.O.S.No.6411/2011 Rs.13,08,29,200/- (towards unpaid sums) under RA bill Nos.1 to 15 and RA bill No.16, Rs.3,38,93,150/- (towards price variation of bitumen), Rs.1,71,73,330/- (towards compensation) and interest at the rate of 6% on these amounts.
71. Though it is pleaded in the plaint regarding these amounts totally of Rs.28,73,52,183/-. It is also pleaded in the plaint at para No.29 in page No.13 that, "Hereto annexed and marked Annexures 20 to 22 respectively, are copies of statement entitled 'Invoice' issued by the Municipal Corporation acknowledging and certifying its liability to pay to the defendant the said sum of Rs.28,73,52,780/- subject to a minor adjustment of Rs.4 lakhs and the challans issued by the Municipal Corporation certifying the said payment." At para No.30 of the plaint, it is pleaded that, "The aforesaid payments totaling Rs.28,73,52,783/- made by the Municipal Corporation to the defendant are pursuant to the awards which clearly direct the Corporation to make payment to the defendant in respect of the works carried out by the plaintiff ..............." It amounts totally Rs.19,40,01,888/-. Though it is pleaded that, these are marked Annexurs 20 to 23. The plaintiff company has produced the photocopies of the same. But, either the certified copy or the true copies have not been produced and got it marked. The PW1 got marked the aforesaid documents at Ex.P1 to P43. The prayer sought by the plaintiff company for direction to the defendant to pay an amount of Rs.27,55,92,150/-. It is also different from the 62 Com.O.S.No.6411/2011 amount awarded by the learned Arbitrator in his additional award.
72. After going through Ex.C1 and C2 i.e. arbitral awards dated 22.03.2003 and 31.05.2003, the learned Arbitrator has passed the award that, "the respondent shall pay to the claimant a total sum of Rs.12,46,34,222/- being the total cost of the works done, variation in bitumen price, disposal of debris, penalty and interest recovered by the respondent (defendant) and refund of security deposit. Also directed to the respondent (defendant) to pay a sum of Rs.8.00 lakhs towards costs to the claimant (BMP). Also directed to the claimant (BMP) to pay a sum of Rs.20.00 lakhs to the respondent (defendant) towards the counter claim with interest thereon at 6% p.a. from 01.11.2001 till payment or adjustment.
73. The learned Arbitrator has passed the additional award of Rs.13,08,29,200/- towards final bill, Rs.3,38,93,150/- towards price variation of bitumen, Rs.5.00 lakhs penalty, Rs.9,28,3556/- towards refundable interest, Rs.1,06,77,852/- towards security deposit, Rs.1,71,73,330/- towards compensation, amounting to Rs.19,40,01,889/- plus Rs.16.00 lakhs costs and interest at 6% p.a. on these amounts. Totally amounts to Rs.19,56,01,889/-. It was in the year May 2003. Subsequently, this was challenged and affirmed by the learned Addl. City Civil Judge in the year August 2009. Subsequently, as per Annexure-20 to 22 (Ex.P16). There is letter correspondence between the parties as referred above. As per Ex.P12 a notice has been issued on behalf of the plaintiff on 63 Com.O.S.No.6411/2011 14.06.2010 and it is replied also as per Ex.P15 by the counter part on 19.07.2010 denying most of the contents of the Ex.P12.
74. Since the defendant company has not produced any documents, except the aforesaid documents. The say of the defendant is that, the plaintiff company has not produced any invoices for the work concerned. But, as per the work orders referred above, the defendant company is liable to pay 75% of the amount received by the BMP towards the work and the expenses occurred for transportation, bituminous mix etc. to be deducted from monthly bills. The Ex.P22 to P43 are RA Bill Nos.1 to 13.
75. After going through the written submission on behalf of the defendant, the learned counsel for the defendant submitted calculation regarding RA bill Nos.2 to 5, 7, 9 to 13 pertaining to Ring Road Bills. After going through these RA bills, an amount of Rs.7,28,17,639/- had been raised pertaining to RA bill Nos.1 to 5, 7, 9, 10 and 12. According to the defendant, an amount of Rs.7,09,83,067/- has been paid, pertaining to other road bills. An amount of Rs.6,77,96,759/- has been raised and as per the defendant, an amount of Rs.6,73,96,759/- has been paid. No particulars furnished regarding RA bill Nos.14 to 16. No details have been produced of these payments were given by the defendant. These amounts have been paid through cheques as per the said statement. But, now particulars have been furnished, no documents have been produced also. When these 64 Com.O.S.No.6411/2011 amounts have been made, no dates, no bank statements are also supplied.
76. As stated supra, there is no dispute between the parties that from time to time amount has been paid by the defendant company for the work done by the plaintiff company. But, this burden lies on the defendant to prove these payments by furnishing materials / documents, which the defendant has not done. It is also come in the evidence of DW1 as stated supra that, he has not produced the documents. The amount claimed by the plaintiff company is, on the basis of the award passed by the learned Arbitrator, which is upheld in the aforesaid suit. Hence, by considering all these material facts of the case, the plaintiff company is entitled only the amount mentioned in the additional award passed by the learned Arbitrator on 31.05.2003 with interest, which is confirmed by the learned Additional District Judge in the aforesaid suit on 11.08.2009.
Particulars Amount 75% of the
(Rs.) amount (Rs.)
As per the Additional award
passed by the learned 19,40,01,889 14,55,01,416
Arbitrator on 31.05.2003
Total 14,55,01,416
77. In view of the discussions made supra, the plaintiff company is able to prove that the defendant company is liable to pay towards the unpaid sums under RA bill Nos.1 to 15 and RA bill No.16, penalty, compensation and interest at 6% on these 65 Com.O.S.No.6411/2011 amounts. Since the transactions between the parties herein are commercial one. There is no dispute. The learned Arbitrator has awarded interest at the rate of 6% p.a. from 01.11.2001 till realization or payment of the amount. Hence, in view of the facts of the case, since more than 24-25 years, the parties are litigating. Hence, future interest is also ordered for 6% p.a. on the said amount i.e. Rs.14,55,01,416/-. In regard to limitation is concerned, the suit of the plaintiff company is within the limitation. I have gone through the decisions relied upon by the learned counsel for the defendant company. The principles laid down in these decisions are well founded. In view of the discussions made supra and after going through the materials and facts on hand, these decisions are not come to the aid of the defendant. Accordingly, I answer the Issue No.1 partly in the affirmative and Issue No.2 in the affirmative and Issue No.3 in the negative.
78. Issue No.5: The plaintiff company is entitled for an amount of Rs.14,55,01,416/- with interest at the rate of 6% p.a. as per the award passed by the learned Arbitrator in the aforesaid claim petition from 01.11.2001. The plaintiff is also entitled for Rs.20.00 lakhs laying in this suit, since, the plaintiff has received Rs.80.00 lakhs out of Rs.1.00 Crore. Accordingly, I answer the Point No.5 partly in the affirmative.
79. Issue No.6: In the result, I pass the following :
66 Com.O.S.No.6411/2011ORDER Suit of the plaintiff company is decreed in part with cost. The plaintiff is entitled for an amount of Rs.14,55,01,416/- from the defendant.
The plaintiff company is also entitled for the remaining amount of deposit of Rs.20.00 lakhs.
The defendant company is liable to pay Rs.14,55,01,416/- with interest at the rate of 6% p.a. from 01.11.2001 as ordered by the learned Arbitrator.
The defendant company is also liable to pay future interest at the rate of 6% p.a. till realization of the amount.
The defendant company is at liberty to deduct the expenses incurred during improvement of Arterial and Sub Arterial roads in Bengaluru City, Package III, South by the plaintiff company.
Draw decree accordingly. Issue copy of the judgment to the parties through email as provided U/Or. XX Rule 1 of CPC if email ID is furnished.
(Dictated to the Stenographer typed by her directly on the computer, corrected and then pronounced by me in the open court on this the 7th day of November 2024) (RAMAKANT CHAVAN) LXXXIV Addl. City Civil & Sessions Judge, (CCH-85) Commercial Court, Bengaluru.67 Com.O.S.No.6411/2011
ANNEXURE List of witnesses examined for the plaintiff:
PW1 Jayaram Reddy PW2 R. Kumaraswamy List of documents marked for the plaintiff: Ex.P1 Board Resolution dated 25.08.2010 Ex.P2 Notarized copy of the agreement Ex.P3 Certified copy of the petition in A.S.No.15002/2003 Ex.P4 Certified copy of the order sheet in A.S.No.15002/2003 Ex.P5 Certified copy of the petition in A.S.No.15002/2003 Ex.P6 Certified copy of the Decree in A.S.No.15002/2003
Statement of account of defendant from 01.04.2001 to Ex.P7 31.03.2022 Ex.P8 Letter dated 08.01.2010 Ex.P9 Letter dated 01.02.2010 Ex.P10 Letter dated 03.03.2010 Ex.P11 Letter dated 09.03.2010 Ex.P12 Office copy of the notice U/Sec.434 of Companies Act Ex.P13 Courier receipt Ex.P14 Postal receipt Ex.P15 Reply dated 19.07.2010 Ex.P16 Certified copy of Company Ptn.No.419/2010 Ex.P17 Reply by the defendant Ex.P18 Certified copy of the rejoinder 68 Com.O.S.No.6411/2011 Certified copy of the judgment in Company Ex.P19 Ptn.No.419/2010 Certified copy of the appeal in Company Appeal Ex.P20 No.275/2010 Ex.P21 Proceedings of BBMP dated 24.06.1999 Ex.P22- 13 RA bills P43 List of witnesses examined for the defendant:
DW1 Narayan R. Joshi
DW2 Rajhoo Bbarot
List of documents marked for the defendant:
Ex.D1 Copy of the Board Resolution dated 15.04.2013
Ex.D2-D4 Certificate of Incorporation
Ex.D5-D6 Certified copy of Form No.18
Ex.D7 The work order dated 01.06.1999
Ex.D8 Copy of the work order 17.11.1999
List of documents marked in C-Series :
Ex.C1 Copy of the arbitral award dated 22.03.2003
Ex.C2 Copy of the Addl. Arbitral award dated 31.05.2003
(RAMAKANT CHAVAN)
LXXXIV Addl. City Civil & Sessions Judge,
(CCH-85) Commercial Court, Bengaluru.