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Delhi District Court

Sh. Vinod Surha vs R. K. Associates & Hoteliers Pvt. Ltd on 1 June, 2022

 IN THE COURT OF ADJ­07, SOUTH­EAST DISTRICT, SAKET COURTS, DELHI

Presided By: Mr. Jay Thareja, DHJS

RCA No: 3/2021

Sh. Vinod Surha
Sole Proprietor of Sunrise Enterprises
B­43, Raju Park, Devli Road,
New Delhi­110062.                                                         ... Appellant
                                                    Versus
R. K. Associates & Hoteliers Pvt. Ltd.
Through its Director,
Having its office at:
A­25, First Floor, Hospital Road,
Jangpura­A, New Delhi­110014.

Also at: D­187, Okhla Phase­I, Near Crown Plaza,
New Delhi­110014

Having Registered Office at:
Opposite Railway Station, Station Road, Durg, CT­491001
                                                                    ... Respondent
                         APPEAL UNDER SECTION 96 OF CPC, 1908

                                                  DATE OF INSTITUTION : 18.01.2021
                                     DATE OF RESERVING FOR JUDGMENT : 28.04.2022
                                                    DATE OF DECISION : 01.06.2022

                                                JUDGMENT

1. The appellant/plaintiff (henceforth 'appellant') has filed this appeal under Section 96 of CPC, 1908, challenging the judgment and decree dated 28.10.2020, passed by the Court of Ld. Civil Judge­01, South­East District, Saket RCA No.3/21 Vinod Surha v R. K. Associates And Hoteliers Pvt. Ltd.

Page no. 1 of 10 Courts, New Delhi (henceforth 'Ld. Trial Court') in Suit No.372/19, Sunrise Enterprises v R. K. Associates And Hoteliers Pvt. Ltd. (henceforth 'subject suit').

2. By way of the impugned judgment and decree dated 28.10.2020, the Ld. Trial Court, has dismissed the subject suit, leaving the parties to bear their own costs.

3. The appellant had filed the subject suit, inter­alia pleading in the plaint of the subject suit, (a) that the appellant and the respondent had entered into a contract, recorded in the work order dated 24.11.2014, whereby the appellant and the respondent had agreed that the appellant will do certain civil engineering work for the respondent, for a total sum of Rs.19,78,959/­, within 45 days; (b) that in pursuance of the said contract, the appellant had done the requisite work for the respondent, albeit with some delay, which was attributable to the respondent; (c) that upon completion of the work recorded in the contract, the appellant had raised a final bill dated 06.10.2015 upon the respondent, seeking a sum of Rs.21,99,814/­, inclusive of cost of the contracted work, amounting to Rs.19,47,600/­, VAT of Rs.1,70,415/­ and Service Tax of Rs.81,799/­; (d) that upon receiving the said bill, the respondent was required to pay to the appellant, a sum of Rs.6,99,814/­ as during the execution of the contract, the respondent had paid a sum of Rs.15,00,000/­ to the appellant; (e) that in partial discharge of the said liability of Rs.6,99,814/­, the respondent had paid a sum of Rs.1,98,000/­ to the appellant, on 09.11.2015 and assured that the respondent will pay the balance sum of Rs.5,01,814/­ within 3 months; (f) that thereafter, the respondent had paid a RCA No.3/21 Vinod Surha v R. K. Associates And Hoteliers Pvt. Ltd.

Page no. 2 of 10 sum of Rs.2,50,000/­ to the appellant, on or around 18.02.2017, leaving a balance of Rs.2,51,814/­; (g) that in order to recover the said balance amount of Rs.2,51,814/­, the appellant had served a legal notice dated 17.12.2018 upon the respondent; (h) that the respondent had replied to the said legal notice vide a vague and baseless reply dated 31.12.2018 and (i) that in such circumstances, the appellant was/is entitled to recover from the respondent, the balance amount of Rs.2,51,814/­ along with interest at the rate of 18% per annum.

4. The respondent had contested the subject suit, inter alia pleading in its written statement, (a) that the work done by the appellant for the respondent was not done within the stipulated time and without taking the requisite measurements, which had resulted in loss to the respondent; (b) that the work done by the appellant for the respondent was of poor quality, which had also resulted in loss to the respondent; (c) that under duress, the respondent had paid the sum of Rs.15,00,000/­ to the appellant, during the execution of the work; (d) that after holding a discussion with the appellant regarding the delay in execution of the work, the poor quality of the work and the entitlement of the respondent to claim of Rs.1,000/­ per day for delay in execution of the work, the respondent had made deductions from the money payable to the appellant; (e) that the respondent has bonafidely made all the requisite payments to the appellant; (f) that the respondent is not liable to pay any money to the appellant and (g) that in such circumstances, the subject suit should be dismissed.

5. In the replication, the appellant had traversed the contents of the RCA No.3/21 Vinod Surha v R. K. Associates And Hoteliers Pvt. Ltd.

Page no. 3 of 10 written statement of the respondent, made the necessary denials and reaffirmed the contents of the plaint.

6. In light of the aforesaid pleadings of the parties, the Ld. Trial Court had framed the following issues in the subject suit, on 25.07.2019:­ "1. Whether the plaintiff is entitled to recovery of an amount of Rs.2,51,814/­ in favour of the plaintiff and against the defendant? OPP

2. Whether the plaintiff is entitled to interest if so, at what rate? OPP

3. Relief."

7. During trial of the subject suit, one witness viz. PW1 Sh. Vinod Surha was examined in support of the case of the appellant and one witness viz. DW1 Sh. Sarfaraz Ahmed was examined, in support of the case of the respondent.

8. In the impugned judgment dated 28.10.2020, the Ld. Trial Court has factored the testimonies of the aforesaid witnesses and dismissed the subject suit by inter­alia finding/reasoning, (a) that since, the appellant has not explained why final bill dated 06.10.2015, Mark PW1/3, claiming a sum of Rs.21,99,814/­ from the respondent, was in excess of the sum of Rs.19,78,959/­ mentioned in the work order dated 24.11.2014, Mark PW1/2, the appellant cannot be permitted to claim any amount in excess of Rs.19,78,959/­ from the respondent; (b) that the respondent, who has already paid a sum of Rs.19,48,000/­ to the appellant, could RCA No.3/21 Vinod Surha v R. K. Associates And Hoteliers Pvt. Ltd.

Page no. 4 of 10 have been held liable to pay the balance sum of Rs.30,959/­ to the appellant but the said amount is liable to be adjusted towards the penalty charges of Rs.2,40,000/­, payable by the appellant to the respondent, on account of 285 days delay in execution of the work awarded to the appellant 1; (c) that in the absence of a counter­claim of the respondent, no money decree, in respect of balance penalty charges can be passed in favour of the respondent and (d) that since, the appellant has not been found to be entitled to recover the principal amount of Rs.2,51,814/­ from the respondent, the appellant is not entitled to recover any interest from the respondent.

9. In order to adjudicate upon this appeal, I had heard Sh. J. L. Joel, Ld. Advocate for the appellant and Sh. Bikram Singh, Ld. Advocate for the respondent, on 28.04.2022.

10. During the hearing of arguments, the Ld. Advocate for the appellant had submitted that this appeal should be allowed by this Court (i) because a combined perusal of the undisputed work order dated 24.11.2014, Mark PW1/2 and the final bill dated 06.10.2015, Mark PW1/3, reflects that by way of the final bill dated 06.10.2015, Mark PW1/3, the appellant had only claimed a sum of Rs.19,47,600/­ towards cost of the contracted work as against the sum of Rs.19,78,959/­ recorded in the work order dated 24.11.2014, Mark PW1/2 and that 1 While giving the said finding, the Ld. Trial Court, relying upon the judgment of the Hon'ble High Court of Delhi in Sunil Sehgal v Chander Batra, (2015) 223 DLT 334, has also concluded that the penalty of Rs.1,000/­ per day mentioned in the work order dated 24.11.2014, Mark PW1/2 was a genuine pre­estimate of the damages, likely to be suffered by the respondent, on account of delay by the appellant, in completing the work awarded to him.

RCA No.3/21

Vinod Surha v R. K. Associates And Hoteliers Pvt. Ltd.

Page no. 5 of 10 the remaining sum of Rs.2,52,214/­, claim in the final bill dated 06.10.2015, Mark PW1/3 pertained to statutory dues viz. VAT and Service Tax, payable by the respondent; (ii) because the work order dated 24.11.2014, Mark PW1/2, which was drawn by the respondent, had not factored the statutory dues viz. VAT and Service Tax payable by the respondent; (iii) because the ledger, Ex.DW1/PX1 of the respondent, reflects that the respondent is still liable to pay a sum of Rs.2,49,814/­ to the appellant and (iv) because in the absence of any specific set off pleaded in the written statement of the respondent as per Order VIII Rule 6 of CPC, 1908, the Ld. Trial Court could not have apportioned the claim of the appellant.

11. Per contra, the Ld. Advocate for the respondent had submitted that this appeal should be dismissed by this Court (i) because in the impugned judgment dated 28.10.2020, the Ld. Trial Court has duly considered the case of the appellant and the respondent and thereafter, dismissed the subject suit; (ii) because the work order dated 24.11.2014, Mark PW1/2, reflects that the respondent was liable to pay a sum of Rs.19,78,959/­ only to the appellant, inclusive of all taxes viz. VAT and Service Tax; (iii) because neither in the legal notice dated 17.12.2018, Ex.PW1/4 nor before the Ld. Trial Court, the appellant had explained that his pending claim against the respondent, is only in respect of the statutory dues viz. VAT and Service Tax, payable by the respondent and (iv) because the respondent had suffered losses, on account of the delay caused by the appellant in execution of the work awarded to the appellant and on account of deficiency in the quality of the work done by the appellant. Upon inquiry regarding

(i) why the ledger, Ex.DW1/PX1 of the respondent, was showing outstanding RCA No.3/21 Vinod Surha v R. K. Associates And Hoteliers Pvt. Ltd.

Page no. 6 of 10 liability of Rs.2,49,814/­ towards the appellant, (ii) why the respondent had not quantified the alleged losses in its written statement and made a proper pleading as per Order VIII Rule 6 of CPC, 1908, (iii) why the respondent had not protested the final bill dated 06.10.2015, Mark PW1/3, immediately upon its receipt in 2015 and (iv) why the respondent had made the last payment of Rs.2,50,000/­ to the appellant, on 18.02.2017, one and a half years after receipt of final bill dated 06.10.2015, Mark PW1/3, without any protest, the Ld. Advocate for the respondent had not given any credible answer/response.

12. After considering the submission made by the Ld. Advocates for the parties, on 28.04.2022 and perusing the record of this file as well as the file of the Ld. Trial Court, I find that this appeal is liable to be allowed, on account of the following reasons.

13. Firstly, this appeal is liable to be allowed because a perusal of the work order dated 24.11.2014, Mark PW1/2, which was drawn by the respondent, clearly reflects that the sum of Rs.19,78,959/­ recorded therein was not inclusive of any taxes viz. VAT and Service Tax and because seen from such perspective, no fault can be found in the final bill dated 06.10.2015, Mark PW1/3, drawn by the appellant, with a view to claim/recover from the respondent a sum of Rs.19,47,600/­ towards the cost of the work done and a sum of Rs.2,52,214/­ towards VAT and Service Tax.

14. Secondly, this appeal is liable to be allowed because the respondent RCA No.3/21 Vinod Surha v R. K. Associates And Hoteliers Pvt. Ltd.

Page no. 7 of 10 cannot be permitted to shirk away from paying the statutory dues viz. VAT and Service Tax, amounting to Rs.2,52,214/­ to the appellant.

15. Thirdly, this appeal is liable to be allowed because ledger, Ex.DW1/PX1 of the respondent, shows outstanding liability of Rs.2,49,814/­ towards the appellant. In this regard, reference is craved to the judgment of the Hon'ble High Court of Delhi in K. R. Impex v Punj Lloyd, (2019) SCC OnLine Del 6667, wherein the Hon'ble High Court of Delhi, inter­alia relying upon the judgments in Mahabir Cold Storage v CIT, Patna, (1991) Supp 1 SCC 402, SCJ Plastics Ltd. v Creative Wares Ltd., (2012) 192 DLT 237 and Deluxe Dentellas Pvt. Ltd. v Ishpinder Kochhar, (2015) 218 DLT 645 DB, has passed a decree of Rs.1,69,73,766/­ along with interest in favour of the plaintiff therein, primarily on account of the fact that in the books of account/ledger of the defendant therein, the defendant therein had shown a liability of a sum of Rs.1,69,73,766/­ in favour of the plaintiff therein.

16. Fourthly, this appeal is liable to be allowed because in view of the obvious contents of the work order dated 24.11.2014, Mark PW1/2 and the final bill dated 06.10.2015, Mark PW1/3 as well as the ledger, Ex.DW1/PX1, it is immaterial whether or not, in the legal notice dated 17.12.2018, Ex.PW1/4 or before the Ld. Trial Court, the appellant had expressly explained the different heads of his claim recorded in the final bill dated 06.10.2015, Mark PW1/3, as has been done before this Court.

RCA No.3/21

Vinod Surha v R. K. Associates And Hoteliers Pvt. Ltd.

Page no. 8 of 10

17. Fifthly, this appeal is liable to be allowed because the failure of the respondent to protest the final bill dated 06.10.2015, Mark PW1/3, immediately upon its receipt in 2015 and the payment of Rs.2,50,000/­ made by the respondent to the appellant, on 18.02.2017, again without any protest, clearly reflect that defences pleaded in the written statement of the respondent, are an after thought.

18. Sixthly, this appeal is liable to be allowed because in its written statement, the respondent has not quantified the losses allegedly suffered by it, because in its written statement, the respondent has not made pleadings as per Order VIII Rule 6 of CPC, 1908 and because in view thereof, it was not open for the Ld. Trial Court to apportion the claim of the appellant, as has been done by the Ld. Trial Court, in the impugned judgment dated 28.10.2020.

19. In view of the aforesaid reasons, this appeal is allowed. The subject suit is decreed in favour of the appellant against the respondent, for a sum of Rs.2,51,814/­ alongwith pendente­lite and future interest at the rate of 6% per annum.2 Also, the costs of the subject suit as well as this appeal are awarded in favour of the appellant.

20. Before parting with this judgment, it is clarified that the appellant has not been granted any pre­litigation interest because in the plaint of the subject suit, the appellant had neither quantified the claim of pre­litigation interest nor paid any 2 As per the judgment of the Hon'ble Supreme Court of India in Central Bank of India v Ravindra, AIR 2001 SC 3095, the grant of pendente­lite and future interest is a subject matter of the discretion of the Court and not to be governed by the agreement between the parties. Keeping in view Section 34 of CPC, 1908, which contemplates grant of interest at the rate of 6% per annum, the plaintiff has been granted pendente­lite interest and future interest at the rate of 6% per annum.

RCA No.3/21

Vinod Surha v R. K. Associates And Hoteliers Pvt. Ltd.

Page no. 9 of 10 court­fees qua it and because if the appellant had done so, then in view of Section 12(1)(a) of the Commercial Courts Act, 2015, the jurisdiction to hear this suit, would have been with the Court of District Judge (Commercial), South­East District, Saket Courts, New Delhi. Also, it is clarified that in this judgment, the work order dated 24.11.2014, Mark PW1/2 and the final bill dated 06.10.2015, Mark PW1/3, have been taken to have been duly admitted in evidence by the Ld. Trial Court because the testimonies of PW1 Sh. Vinod Surha and DW1 Sh. Sarfaraz Ahmad, reflect that the work order dated 24.11.2014, Mark PW1/2 is an admitted document and that the respondent does not dispute receipt of the final bill dated 06.10.2015, Mark PW1/3.

21. The Reader is directed to prepare a decree sheet, as per this judgment. Also, the Ahlmad is directed to send a certified copy of this judgment and the consequent decree to the Ld. Trial Court along with the record of the Ld. Trial Court. After compliance of the said directions by the Reader and Ahlmad, the file shall be consigned to record room.

Digitally signed by JAY

                                                              JAY         THAREJA
                                                              THAREJA     Date:
                                                                          2022.06.01
                                                                          16:59:17 +0530

Announced in open Court                                       (Jay Thareja)
today on 01.06.2022                                  Ld. ADJ­07, South East District,
                                                           Saket Courts/Delhi




RCA No.3/21
Vinod Surha v R. K. Associates And Hoteliers Pvt. Ltd.
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