Bangalore District Court
Tam Tam Pedda Guruva Reddy Construction ... vs The State Of Karnataka on 16 October, 2024
KABC170172912020
IN THE COURT OF LXXXVII ADDL.CITY CIVIL &
SESSIONS JUDGE, BENGALURU (CCH.88)
Present: Smt. Roopa K.N., B.Sc., LL.B.,
LXXXVII Addl.City Civil &
Sessions Judge, Bengaluru.
Dated: 16th day of October, 2024
Com.O.S.No.5370/2016
PLAINTIFF : : TAM TAM GURUVA REDDY
CONSTRUCTION PVT. LTD.
Having their Registered Office at No.
1427, 18th Main, 2nd Cross,
J.P.Nagar II Phase,
Bengaluru - 560 078.
Represented by Director - Sri Gopal
Krishna.
-Vs-
DEFENDANTS : 1. THE STATE OF KARNATAKA
Represented by the Secretary,
Water Resources Department
Government of Karnataka,
Vikasa Soudha,
Bengaluru - 560 001.
2. CAUVERY NEERAVARI NIGAM LTD.
Represented by its - Managing
Director
/2/
Com.O.S.No.5370/201
Surface Water Data Circle,
2nd & 3rd Floor, Ananda Rao Circle,
Bengaluru - 560 009.
3. CAUVERY NEERAVARI NIGAM LTD.,
Represented by its - Chief Engineer,
Hemavathi Canal Circle, Kunigal Road,
Tumkuru.
4. CAUVERY NEERAVARI NIGAM LTD.,
Represented by its - Executive
Engineer
Hemavathi Canal Division,
Yediyur, Kunigal Taluk,
Tumkuru.
Date of Institution of the suit 23.07.2016
Nature of the suit (suit on MONEY SUIT
pronote, suit for declaration &
Possession, Suit for injunction
etc.)
Date of commencement of 27.03.2019
recording of evidence
Date on which judgment was
pronounced 16.10.2024
Total Duration Year/s Month/s Day/s
08 02 25
(ROOPA K.N.),
LXXXVII Addl.City Civil & Sessions Judge,
(Exclusive Dedicated Commercial Court)
Bengaluru.
/3/
Com.O.S.No.5370/201
:JUDGMENT:
This suit is filed by the plaintiff for recovery of total sum of Rs.5,50,17,600/- payable by the defendants with interest at the rate of 24% p.a.
2. It is the case of the plaintiff that, it is a company registered under the companies Act doing the business of construction of Civil Works defendant No.1 is Department of Water Resources, defendant Nos.2 to 4 are Cauvery Nigama Ltd. On 10.07.1995 an agreement was entered into between plaintiff and defendant No.1 for executing the work of construction of tunnel which cost Rs.374.20 Lakhs defendant No.2 is a successor for all works they were executed under Cauvery river Basin. In view of the above contract plaintiff took over the work of constructing channel and the contract period was fixed as 12 months from 10.07.1995 and it should have completed on 10.07.1996. Plaintiff purchased machineries and arranged men to carryout contract work but /4/ Com.O.S.No.5370/201 for various reasons the work got extended and it was completed only on 10.02.2000. According to plaintiff though he performed his part of obligations as per the agreement the defendants failed to make payment for the contract work and also for the additional works which the defendants got it done through the plaintiff. Plaintiff also claims compensation on many heads since he allege that, the delay in executing the work was non co-operation from the defendants. Hence, plaintiff has filed the above suit and sought for decree of the same for the suit claim amount.
3. Defendants 2 to 4 filed their written statement and denied the averments of the plaint and inter-alia contended that, the delay caused by the plaintiff to complete the work under the contract is not due to defendants but, it was the plaintiff who could not finish the work in time. According to defendants, the allegations made in the plaint are baseless and hence, suit is liable to be dismissed.
/5/ Com.O.S.No.5370/201
4. On the basis of the pleadings, this Court has framed the following issues:
1. Whether the plaintiff proves that in-spite of delays, which are not attributed to it resulted in the contract work being extended till 10.02.2000, wherein the virtual completion of the tunnel excavation and concreting was completed and hence the defendants are liable to pay the claim Nos.1 to 17 made at paragraph Nos.34 to 66 of the plaint?
2. Whether the plaintiff is entitled to the relief sought for?
3. What order or decree ?
5. My findings on the above Issues are as under:
Issue Nos.1 and 2 : In the " AFFIRMATIVE"
Issue No.3 : As per the final order for the following;
:REASONS:
6. ISSUE NOS.1 and 2:- As both these points are inter connected, they have been taken-up together for common /6/ Com.O.S.No.5370/201 discussion and to avoid repetition of facts and evidence.
On behalf of the plaintiff company the Managing Director Mr.Tam Tam Pedda Guruva Reddy filed his affidavit in lieu of chief examination as P.W.1 and he got marked Ex.P.1 to P.90. On the other hand, at 1 st one Manjegowda defendant No.4 filed his affidavit and was examined as D.W.1 and his affidavit was withdrawn on 07.08.2021. Thereafter, the Executive Engineer of defendant No.2 and 4 by name Jayaramaiah filed his affidavit in lieu of chief examination and he got marked Ex.D.1 to D.82.
7. Both counsel for plaintiff and defendant filed their written arguments which are nothing but replica of their respective pleadings. Hence, same is not repeated.
Counsel for plaintiff while addressing his arguments relied on following decisions; AIR 1965 SC 1981, 2002 (4) SCC /7/ Com.O.S.No.5370/201 45, (1999)6 SCC 667, 2006(11)SCC 181, (1974)2 SCC 231, 1984(4) SCC 59, 1999(3) SCC 500, 2011(10) SCC 573, AIR 1964 MP 101(DB), (2017)8 SCC 146, 2007(13) SCC 43, AIR 1999 Mad 317, 1997 (1) SCC 738, 1989 SUPP 1 SCC 368, 1984(2) SCC 860 AIR 1984 SC 1072 (para 44), 2007(13)SCC 43 (para 32), 2002(4) SCC 45 (para 15), 2017 (8) SCC 146 (para 14, 19, 21), (2006) 11 SCC 181 (Paras 102-115), 2006 (11) SCC 181 (para 83 and 104), 2023 SCC Online SC 1208 (Para 14, 15, 16), 2015 SCC OnLine Hyd 526-24% (para 20), 2015 SCC OnLine HP 3375 24% (Para 14), (2012)8 SCC 516 (Para
12), (2022)1 SCC 115 (Para 44), (1974)1 SCC 242 (Para
27), (1981)1 SCC 80 (Head Note 'C' and para 17), ILR 1982 KAR 446 (Para 4), 2006(12) SCC 552 (Head Note A and Para 9), AIR 1961 Calcutta 359 (Para 10), 1971(3) SCC 273 (Head Note and Para 8), AIR 1968 SC 1413 (Para 5), (2016)12 SCC 288 (Head Note and para 15), /8/ Com.O.S.No.5370/201 2013 SCC Online Kar 9929 (Para 16), Manu/DE/0747/1985 (Para 8), 1961 SCC OnLine Cal 20 (Para 14), Manu/WB/0051/1963 (Para 15), (1988)2 SCC 338 (Para 4), (2020) 14 SCC 643 (Para 24), (2016) 16 SCC 152 (Para 8), (1998) 8 SCC 357, (2004)3 SCC 458 (Para 14), (2009)1 SCC 786 (Para 18), (2015) 7 SCC 58 (Para 35), (2006)6 SCC 239 (Para 26). ILR(2010) 2 Del 699, 2023 SCC OnLine Del 8044, 1921 SCC Online PC 102 (Para 8), AIR 1959 SC 24 (Para 13), AIR 1963 SC 890 (para 12), 2024(4) SCC 318, (2009)5 SCC 313, (2021) SCC OnLine SC 1207, 2022 SCC OnLine SC 509, 2022 SCC OnLine SC 1132, (2009)10 SCC 552, (2006)2 SCC 628
8. On the other hand, the learned counsel for defendant Nos.2 to 4 also relied on following decisions;
1. 1999 (3) Arb.LR 350 (SC) Rajasthan State Mines & Minerals Ltd. Vs. Eastern Engg.
/9/ Com.O.S.No.5370/201 Enterprises & Anr.
2. 2007 (3) Arb.LR 519 (Gau)(DB) State of Tripura .Vs. Sabitri Salt Supplies
3. 2011 (4) Arb.LR 219 (Del) MSTC Ltd. Vs. Jain Traders & Ors.
4. 2007 (3) Arb.LR 254 (Bom)(DB) Pawan Hans Helicopter Ltd Vs. Associated Construction
5. 2009 (4) Arb.LR 225 (SC) Grasim Industries Ltd Vs. Agarwal Steel
6. 2003 (1) Arb.L.R40 (Kar)(DB) State of Karnataka Vs. Stellar Construction Co.
7. 2011 (4) Arb.LR139 (Bom) Oil & Natural Gas Corpn.Ltd Vs. Oil Country Tubular Ltd
8. 2011 (4) Arb.LR108 (SC) Phulchand Exports Ltd Vs. Patriot
9. 2011 (4) Arb.LR 1 (SC) Cauvery Coffee Traders Vs. Hornor Resources (Intern.) Co.Ltd
10. 2013 (2) Arb.LR 476 (Bom) The New India Insurance Co.Ltd Vs. Pyarelal Textile Ltd., & ors.
11. 2012 (2) Arb.LR91 (Del)(DB) Mohanlal Harbanslal Bhayana & Co.Vs. Union of India
12. 2012 (1) Arb.LR16 (Bom) Radha Krishna Films Ltd Vs. Jyoti Film Distributories Pvt.Ltd & Anr.
13. 2011 (6) AIIMR616 (Bom) Union of India Vs. Sun Media Services
14. 2003 (2) Arb.LR 5 (SC) Oil and Natural Gas Commission Vs SAW Pipes Ltd., /10/ Com.O.S.No.5370/201
15. (1989) 4 SCC 595 K.V.George Vs.Secy.to Govt, Water & Power Dept., Trivandrum & Anr
16. 2008 (2) Mh.LJ 542 Hindustan Petroleum Corpn.Ltd. Vs. Batliboi Environmental Engineers Ltd.
17. (2011) 10 SCC 573 MSK Projects India (JV) Ltd Vs. State of Rajasthan & Anr.
18. (2012) 12 SCC 581 State of Goa Vs Praveen Enterprises
9. The plaintiff has been duly cross-examined by learned counsel for defendant No.2 in which he admitted that, as per the agreement he was suppose to construct tunnel and his company was assigned with said project as sub lease contract. He also admitted that, prior to signing the agreement he made site visit but, he voluntarily deposed that, subsequently everything changed regarding scope of work and he raised dispute prior to entering into Ex.P.2.
He also admitted that, as per the terms of agreement he should have completed the work by 10.07.1996. According to him he could not complete the work within stipulated /11/ Com.O.S.No.5370/201 time on the account of change of scope of work and failure on the part of Department to provide steel and other material. According to him he obtained written permission before proceeding with additional work and also admitted that, completion certificate was not issued since final bill was not passed. Except these few admissions all other are bare suggestions and denial. If we peruse the cross-
examination of D.W.2 one Jayaramaiah, Executive Engineer in defendant No.2 he deposed that, he was not working in defendant Nigama during the period from 1995 to 2001 and he took charge in defendant office on 17.05.2018. He further deposed that, without looking into documents he cannot say anything as to who were the in-charge of the project in dispute. He also admitted that, even in the project under dispute one Section office was in-charge of every day work along with AEE and he used to visit the spot on alternative days and before commencement of the work /12/ Com.O.S.No.5370/201 they used to have project plan, geological mapping etc. Thereafter, there will be a technical sanction by the Chief Engineer. He admitted that, in Ex.D.1 i.e., in page 161 there is a report of geologist wherein it is mentioned that, since the area consist of silt soil and soft rock there will be no difficulty for excavation. It is further admitted that, in Ex.D.7 inspection of the site was made on 13.03.1996 and in all major projects the site order book will be maintained by the Section Officer and every day work progress will be mentioned in the said book. He further admitted that, in last column of Ex.P.84 the actual work done by the plaintiff is reflected and as per Ex.P.84 amount due for plaintiff was Rs.22,35,063/- and Department did not taken any action against their official for correctness for Ex.P.84. He do not know whether the amount was paid to the plaintiff. He also admitted that, the last voucher of the plaintiff was dtd:03.03.2000 and it is also true that there is price /13/ Com.O.S.No.5370/201 escalation factor available in the Department in case of delay in completion of the work. He denied that, in case of variation in steel, fuel, cement, there will be escalation factor of 125% over and above the schedule rate. He further admitted that, in clause 26 of Ex.D.1 there is a mention about escalation factor upto 125%. According to him in page No.54 it has been deleted as not applicable. He further admitted about the nature of work allotted to plaintiff and there was no separate planning for approach and exit points. He also admitted that, page No.170 to 173 of Ex.D.1 are the drawing pertaining to approach and exit points and page 174 is location plan. He further admitted that, Ex.P.70 is a letter issued by AEE which has been counter signed by Superintendent Engineer and in Ex.P.70 there is mentioned about non availability of dumping area.
He further admitted that, the Engineers who are working then proposed for enhancement by way of revised cost. He /14/ Com.O.S.No.5370/201 further admitted that, their engineers working in the year 1998 mentioned in Ex.D.72 about non tendering of grouting plan to the plaintiff and the canal become operational in the year 1998. He further admitted that, for the purpose of project work defendants were suppose to supply electricity and in case of power failure the contractor had to make his own arrangement and through out the period of contract there was no supply of electricity by the defendant and it was the plaintiff who made the arrangement for supply of electricity. He also admitted that, in the running bills they have not taken account of money spent by the plaintiff towards purchase of diesel for generation of electricity. He do not know whether committee has approved claim No.5 of the plaintiff partially. He also admitted that, claim No.1,3,4,6 and 8 have been approved and other claims have been rejected. He denied that, claim No.7 was also approved. He further admitted that, claim for diesel bills /15/ Com.O.S.No.5370/201 have not been rejected for any other reasons.
10. If we carefully peruse the oral and documentary evidence of both plaintiff and defendant according to plaintiff after signing the contract there was delay in reaching end point for the following reasons.
1. Adverse geological conditions
2. Various alterations and deviations in the contract by the defendants.
3. Delay in issuing construction drawings
4. Delay in land acquisition for widening of canal sides slop width.
5. Inadequacy of land for dumping excavated materials.
6. Defendants failure to supply steel and cement.
7. Defendants failure to supply KEB power
8. Restriction in blasting
9. Delay in making payments for running bills.
11. It is admitted fact that, originally this project was entrusted to Karnataka State Construction Corporation /16/ Com.O.S.No.5370/201 which in turn entrusted the work to plaintiff. The fact that, agreement dtd:10.07.1995 was entered into with the plaintiff and the cost of contract was Rs.374.20 Lakhs and the nature of work to be done by the plaintiff are undisputed by the defendants. Let-us see whether plaintiff succeeded in proving the above 9 grounds for delay in reaching end point of contract.
1. Adverse Geological Conditions: Plaintiff plaintiff has pleaded that, he faced several hindrances on account of the adverse geological conditions which was existing on the construction site which was not brought to the notice of the plaintiff prior to its commencing the work and even plaintiff never expected the said issue. The plaintiff also encountered hard rock and jointed cracks which hindered the work and there was also seepage of ground water all of which necessitated easing of the canal slopes. As a result of the hard rock, the plaintiff had to resort to usage of greater quantity of explosives and had do more drilling, defuming and demucking in the tunnel area which lead to additional cost and time. Plaintiff relied on Ex.P.7 which is a letter dtd:19.11.1996 issued by the Chief Engineer addressed to /17/ Com.O.S.No.5370/201 the Secretary of the Irrigation Department in which The Chief Engineer addressed that, there are intrusions in the rocks like schists and pegmatites in the jointed cracks in the main rock and they can easily slip and break to thin flakes or plates. It was also mentioned in the said letter that, there was seepage of ground water which will make it difficult to construct the canal and tunnel. Further, plaintiff relied on Ex.P.16 which is a letter dtd:26.12.1997 issued by the Superintendent Engineer addressed to the Chief Engineer stating that, there is a presence of jointed cracks in the hard rocks which frequently falls into the tunnel and the Superintendent Engineer recommended that, the slopes have to be easened. Further, plaintiff relied on Ex.P.35 and on perused on the same it is a letter dated 27.02.1996 by the plaintiff addressing to the Executive Engineer wherein he has mentioned that, despite using various drilling patterns there is difficulty in securing better pull during blasting and furthermore, when the defendants had stated that, a pull of 1.5 m would be achieved, in reality the average lesser pull which was achieved was only 0.8 to 0.9 m which establishes the fact that, due to the presence of hard rock and adverse geological conditions, the effectiveness of blasting was largely reduced which led the /18/ Com.O.S.No.5370/201 plaintiff to spend more money for blasting. Ex.D.35, Ex.D.38, Ex.D.39 and Ex.D.40 were relied by the plaintiff which are the letters and in Ex.D.35 dated 10.10.1996 the Chief Engineer requested the Engineer of the defendants authorities requesting them to take a decision on widening the canal side slopes due to the geological conditions at the project site. Under Ex.D.38 dtd:12.07.1996 the Chief Engineer once again stated that, widening of the canal side slopes has to be made similarly under Ex.D.39 and Ex.D.40 dated 06.01.1997. If we carefully peruse these documents relied by the counsel for plaintiff it is very much clear that, defendants themselves expected widening of canal side slopes to be done by the plaintiff and these letter transactions held between 09.05.1996 to 26.12.1997. This fact shows that, due to the decision taken by the defendants plaintiff was forced to reduce the blasting and spend more money to meet the expenditure for blasting and widening of canal slope sides.
2. Alterations & Variations in Contract :- It is the case of the plaintiff that, since defendants failed to properly verify the geological conditions of the site he was forced to seek changes including widening of the canal, easing of the /19/ Com.O.S.No.5370/201 canal slopes, etc. Further, it is contended that, defendants frequently got the plaintiff to make changes, alterations to the work carried out and often the decisions and approvals of the defendants for that altered work came after prolonged period of delay and many times defendants went back on its own decision without any valid reason. To prove this fact plaintiff relied on Ex.P.65 which is a report prepared by the Executive Engineer and the Assistant Executive Engineer in the year 2000 and this report contains number of recommendations to the various claims submitted by the plaintiff and in the said report there is a mention that, there were several variations and extra claims to the original contractual work and the authorities who prepared the report consideration those aspects and authorised payment of several claims to the plaintiff. Plaintiff also relied on Ex.P.70 which is also a report prepared by the Assistant Executive Engineer in which it has been clearly states that, a permanent ramp at the exit cut has to be newly constructed by taking into consideration of the new measurement and apart from this a new land for dumping of excavated material was also recommended, though the defendants were very well aware that, the land proposed for dumping excavated material was situated far away from the /20/ Com.O.S.No.5370/201 project site. These documents makes it clear that, because of the conduct of the defendants plaintiff could not proceed with his work as there were several variations and adding of additional works to be done by the plaintiff.
3. Variations made in the type of blasting : Plaintiff relied on Ex.P.6 letter dtd:27.02.1996 under which he requested the Executive Engineer to make payment for controlled blasting and approach ramp excavation. Ex.P.14 is a letter from from the plaintiff to the Chief Engineer under which the plaintiff requested the Chief Engineer to make payment for additional works. Ex.P.5 is also a letter dtd:29.06.1998 under which plaintiff informed the Executive Engineer that, he is unable to carry out the construction activities as the nearby villagers opposed for carrying blasting operations and he requested the executive engineers to remove the villagers so that, he can carry out blasting operations and he can resume his construction work. Further, plaintiff relied on Ex.P4 a letter dated 28.05.1999 issued by the Executive Engineer to the Chief Engineer in which the Executive Engineer has states that, there are several inhabitants around the construction site and hence plaintiff is facing difficulty to proceed /21/ Com.O.S.No.5370/201 construction work and plaintiff has to stop using blasting as stated in the contract and instead he has to use controlled blasting. In the said letter the engineer himself has stated that, the cost of using controlled blasting would be more than normal blasting and he sought for immediate sanction so that, plaintiff can do controlled blasting. These documents shows that, plaintiff performed his part of obligation to proceed with the work of blasting i.e., controlled blasting as a result of which he spent more money than the agreed amount as per the contract.
4. Delay in Issuance of Construction Drawings : To prove that, there was delay on the part of defendants in issuance of construction drawings plaintiff relied on Ex.P22 dated 02.12.1997, Ex. P42 dated 20.12.1997, Ex.P43 dated 07.12.1997, Ex. P47 dated 28.10.1997, Ex.P48 dated 31.10.1997. I have carefully perused these letters which were exchanged between various defendants engineers under which the defendants authorities were asked to approve and submit grouting drawings to the plaintiff which shows that, those drawing were not provided to the plaintiff and there was delay of several years in issuing the same. Similarly, Ex.P.38, Ex.P.44, Ex.P.45, Ex.P.46 and Ex.P.57 /22/ Com.O.S.No.5370/201 are the letters issued by the plaintiff under which he requested the defendants to issue construction drawings but the defendants did not complied the same in time.
5. Delay in Acquiring Land for widening of canal side slopes and inadequacy of land for dumping area :
According to plaintiff defendant caused delay in procuring land for dumping the excavated material but they identified a different land which was far away from the project site and plaintiff spent more money than the contractual amount since he has to dump the excavated material in that different land which led increase of cost to the plaintiff. Plaintiff relied on Ex.P.70 which is a report prepared by the Executive Engineer and Assistant Executive Engineer in which they have clearly states that, the land acquired for the purpose of exit canal has been fully utilised and hence, there is no land available at the side of the canal so as to construct side slopes and they recommended the plaintiff to dump the excavated material at extra lead charges. This letter Ex.P.70 clearly shows that, due to the delay on the part of defendant to procure the land for constructing slopes on the canal sides and as the defendants made the plaintiffs to dump the excavated materials in a different /23/ Com.O.S.No.5370/201 land which was situated far away from the project site plaintiff suffered monitory loss.
6. Failure to supply structural steel and cement:
Under the terms of the Agreement in Ex.D1, the defendant was required to supply structural steel and cement to the plaintiff at the rates specified in Schedule-A to the Agreement and also as per the letter dated 24.05.1995 marked as Ex.D.1. further, Ex.D.1 also stipulated that, on such supply of steel and cement the said value would be deducted from the sums due under the rates prescribed in Schedule A of the agreement. But, the defendants failed to supply the steel and caused delay in also supplying cement as a result of which plaintiff was forced to procure the same from private market paying huge amount of advance. Plaintiff relied on Ex.P.87 a letter dated 24.05.1995 written by the defendant authority to the Chief Engineer in which the defendants authority have undertakes to provide steel and cement to the plaintiff. Ex.P29 dated 02.02.1996, Ex.P28 dated 04.06.1996, Ex.P30 dated 11.09.1996, Ex.P31 dated 05.03.1997 are the letters issued by the defendants authorities addressed to the plaintiff in which they permitted the plaintiff to purchase structural steel /24/ Com.O.S.No.5370/201 which shows that, the defendants acted contrary to the terms of contract and they failed to provide structural steel and cement and as evident from Ex.P.31 it could be seen that, defendants failed to perform his part of contract knowing fully well that structural steel and cement were primary materials required for construction of the Tunnel. Further plaintiff relied on Ex.P33 letter dated 07.05.1997 addressed to the Chief Engineer in which plaintiff sought payment for the structural steel purchased from his own money which was not paid to him.
7. Failure to supply KEB power: According to plaintiff, defendants were supposed to supply KEB power and the plaintiff was only required to utilise the diesel power when there was failure of electricity and knowing fully well this fact, defendants failed to supply KEB power enabling the plaintiff to do the project work as a result of which plaintiff was forced to continue his work by using diesel power at his cost. The Ex.P.49 is a letter dated 06.09.1997 under which the plaintiff sought payment of pending dues from the then Dy.Chief Minister and Minister for Finance. Under Ex.P.38 dtd:22.01.1998 plaintiff again requested the Assistant Executive Engineer for payment. Under Ex.P.50 /25/ Com.O.S.No.5370/201 dtd:24.01.2000 the Chief Engineer has specifically stated that, the defendant authorities have to make payment of Rs.150 lakhs which is due to the plaintiff. Ex.P.65 is a report prepared by Executive Engineer and the Assistant Executive Engineer in the year 2000 which recommended the defendants to make payment to the plaintiff towards the expenditures incurred in supply of electricity power.
Plaintiff further relied on following documents which are pertaining to additional work done with respect of widening of the canal side slopes.
13. The various exhibits pertaining to additional work done with respect to widening of the canal side slopes are as follows:
a) Ex.P7: This exhibit is a letter dated 19.11.1996 from the Chief Engineer to the Secretary of the defendant authority.
The Chief Engineer states that there is a requirement for widening the canal side slopes due to the adverse geological conditions. The Chief Engineer makes several additions to the original work including, providing of several berms, /26/ Com.O.S.No.5370/201 excavation of differen depths, easing of side slopes, change in the dimensions of side slopes, etc
b) Ex. P10, This exhibit is a letter dated 15.12.1997 from the Chief Engineer to the Superintendent Engineer stating that the widening of canal at exit cut has been completed. This letter evidences the fact that there were significant variations in the contract, and the plaintiff duly completed all the variations, with pending payments for the same.
c) Ex. P11: This exhibit is a letter dated 15.12.1997 from the Chief Engineer to the Superintendent Engineer stating that the widening of canal at exit cut has been completed. This letter evidences the fact that there were significant variations in the contract, and the plaintiff duly completed all the variations, without being paid for the same.
d) Ex. P13 Dated 6.12.1997 Ex. P15: Dated 2.12.1997 These exhibits are various letters from the plaintiff to the defendants authorities requesting payment for the additional work done for widening of exit cut.
/27/ Com.O.S.No.5370/201
e) Ex. P16: This exhibit is a letter dated 26.12.1997 from the Superintendent Engineer to the Chief Engineer stating that the widening of the canal side slopes are required payment to be made to the plaintiff.
f) Ex. D13: This exhibit is a letter dated 12.12.19997 from the Engineer of the defendants authority to the Superintendent Engineer. The Engineer states that there has to be a widening of the canal.
g) Ex. D20 Dated 1.8.1.1996 Ex. D28 Dated 16.1.1997, Ex. D35 Dated 10.10.1996, Ex. D37 Dated 21.8.1996-Ex.D40 Dated16.1.1997 and Ex.D54: Dated 2.3.1996 These exhibits are various letters between the defendants authorities stating that the canal side slopes have to be widened.
Plaintiff relied on following documents to prove additional works done with respect to watery situation and extra lead charges A) Ex.P12: This is a letter dated 15.12.1997 from the Chief Engineer to the Superintendent Engineer. The Chief /28/ Com.O.S.No.5370/201 Engineer states that the claims of the plaintiff with respect to dewatering, watery situation and extra lead charges are to be settled immediately.
B) Ex.P14: This is a letter dated 06.12.1997 from the plaintiff to the Chief Engineer. The plaintiff states that additional works with respect to watering charges, extra lead charges, excavation in watery situation and covered blasting was completed and payment for the same is to be made by the defendants authorities.
C) Ex.P65: This is a report prepared and authorised by the Executive Engineer and the Assistant Executive Engineer in the year 2000. The said Engineers have stated that the plaintiff is entitled to be paid for the work done in watery situations and extra lead charges.
15. Following exhibits are pertaining to additional work done with respect to additional ramp are as follows:
a) Ex.P70: This exhibit is a letter from the Assistant Executive Engineer to the defendant authorities. The said engineer states that there has to be a construction of an /29/ Com.O.S.No.5370/201 additional ramp. This work is an additional work and is a variation from the original contract.
16. The various exhibits pertaining to additional works done with respect to permanent support are as follows:
a) Ex. D68: This is a letter dated 11.09.1996 from the Engineer of the defendant authority to the plaintiff stating that the plaintiff cannot continue his work without installing the permanent supports, which is an additional work and is a variation from the original contract.
b) Ex.P32: This is a letter dated 22.07.1997 from the Chief Engineer to the plaintiff changing the contractual terms with respect to the installation of the permanent supports, despite the letter dated Nil in Ex. D67. The said Engineer states that there is no necessity of providing the permanent supports. Furthermore, if the permanent supports are already constructed it may be used elsewhere. It can thus be see that even after the defendants changed the contractual terms, and after the plaintiff had purchased the permanent support steel, the defendants without any concern to the plaintiff expenses, once again changed the /30/ Com.O.S.No.5370/201 contractual terms and stated that the permanent supports are not required. This left the plaintiff with enormous loss for no reason whatsoever.
12. To prove that, defendants caused delay in making payments for the work completed in running account plaintiff relied on
b) Ex. P9 dated 20.12.1997, P10 dated 15.12.1997, Ex. P11 dated 15.12.1997, Ex. P12 dated 15.12.1997, Ex. P18 dated 15.12.1997, Ex. P50 dated 24.01.2000, Ex. P52 dated 13.01.2000, Ex. P53 dated 16.06.1999, Ex. P54 dated 27.05.1999, Ex. P68 dated 1999-2000, Ex. P69 dated December 2000, Ex. P70, Ex. P75 dated 01.06.2002, D27 dated 20.01.1997, Ex. D28 dated 16.01.1997 and Ex. D36 dated 26.08.2000: These exhibits are several letters from the defendants engineers to the defendants authorities stating that payments to the plaintiff have to be made.
c) Ex. P4 dated 28.05.1999, Ex. P13 dated 06.12.1997, Ex. P14 dated 06.12.1997, Ex. P15 dated 02.12.1997, Ex. P16 dated 20.12.1997, Ex. P19 dated 06.12.1997, Ex. P20 dated 06.12.1997, Ex. P21 dated 02.12.1997, Ex. P23 dated /31/ Com.O.S.No.5370/201 02.12.1997, Ex. P24 dated 02.12.1997, Ex. P25 dated 02.12.1997, Ex. P26 dated 02.12.1997, Ex. P27 dated 02.12.1997, Ex. P33 dated 07.05.1997, Ex. P34 dated 15.03.1997, Ex.P35 dated 27.02.1996, Ex. P36 dated 26.09.1996, Ex. P37 dated 20.01.1996, Ex. P38 dated 22.01.1997, Ex. P49 dated 06.09.1997, Ex. P55 dated 05.06.1998, Ex. P56 dated 04.04.1998, Ex. P57 dated 05.03.1998, Ex. P58 dated 11.02.1998, Ex. P59 dated 13.04.1996, Ex. P60 dated 01.01.1998, Ex. P61 dated 17.03.1998, Ex. P62 dated 07.02.2000, Ex. P63, dated 7.2.2000 Ex. P71 dated 25.02.2002, Ex. P72 dated 09.03.2002, Ex. P73 dated 25.03.2002, Ex. P74 dated 15.04.2002, Ex. P76 dated 15.06.2002, Ex. P77 dated 17.04.2003 and Ex. P78 dated 02.07.2002: These exhibits are letters from the plaintiff to the defendants authorities requesting for payment for claims.
d) The defendants has not paid the 18th and part bill, which is produced as Ex. P84.dated 19.7.2003 Despite the work being completed in 2000, the final bill has neither been drawn nor paid by the defendants to the plaintiff.
/32/ Com.O.S.No.5370/201
13. If we carefully peruse the cross-examination of D.W.1 the documents relied by the plaintiff, D.W.2 in his cross- examination admitted that, amount sought by the plaintiff in column No.1 to 18 are to be paid by the defendants to the plaintiff.
14. If we peruse the various claims raised by the plaintiff on the account of the various breaches done by the defendants, they are as here under:
Claim 1: Payment for back slope quantities at approach cut and exit cut amounting to Rs. 11,92,768/-
a) As per the directions of defendants plaintiff did additional excavations on the back slope of the approach and exit tunnel and such excavation was over and above the quantity specified in the agreement. The same in fact was an additional work. Ex. P60 is a letter dated 01.01.1998 issued by the plaintiff to the defendants authorities referring to plaintiff's claims and also the detailed calculations in arriving at the claim amount. According to plaintiff he incurred an expenditure of Rs. 2,27,000, and for the exit face the plaintiff incurred an expenditure of Rs.
/33/ Com.O.S.No.5370/201 9,65,768, and a total expenditure of Rs. 11,92,768. Ex. P65: This exhibit is a report prepared and authorised by the Executive Engineer and the Assistant Executive Engineer in the year 2000. The defendants has fully admitted to the said claim of Rs. 11,92,768 . This claim of Rs.11,92,768/- has been fully admitted by the defendants in their written statement at para no. 40 in page nos. 21-22 and also in their examination in chief in para no. 37 in page nos. 19-
20.The plaintiff has not been cross examined by the defendant's counsel on the said claim made in Ex. P60. The defendants in their cross examination dated 15.12.2021 admitted the following with respect to Claim No.1:
i. Claim no. 1 has been approved by the competent authority.
ii. Claim no. 1 has not been settled till date. iii. KSCC had not completed exit and approach cut back slopes at the tunnel.Further in the cross examination of DW1 dated 27.10.2021 it is admitted that the work has been carried out as per the contract terms and instructions of the assistant executive engineer and the authorities. Hence it can be safely held that defendants have /34/ Com.O.S.No.5370/201 accepted this claim No.1.
Claim 2: Pending payment for canal side slopes at approach cut amounting to Rs. 67,20,000/- .
It is the case of the plaintiff that, on account of the adverse geological conditions, the side slopes at the approach cut were not stable. In order to impart stability to the canal slide slopes and to ensure the permanent safety of the canal, the defendants directed the plaintiff to ease the side slopes of the approach cut. Such work was executed by the plaintiff under the directions and with the knowledge of the defendants. He relied on Ex. P60 which is a letter dated 01.01.1998 issued by the plaintiff to the defendants authorities stating the plaintiff's claims and also the detailed calculations in arriving at the claim amount. The calculations are, the length of the canal is 300M, the quantity involves is, 1x 300m x 3.2m x 22m 21,120cmtr, 21,000cmtr x the rate @320/cmtr Rs. 67,20,000/-. The plaintiff has categorically stated this claim amount in his plaint and examination-in- chief. The plaintiff has not been cross-examined by the defendants on Ex. P60. Ex. D27 dated 20.01.1997 and Ex. D38 are letters from the /35/ Com.O.S.No.5370/201 defendants engineer to the defendants authorities stating that, the approach and exit canal excavation are nearing completion and that the work slip have to be prepared for approval by the defendants authorities. This shows that, defendants have admitted this claim and has recommended payment of this claim. Therefore, it can be held that plaintiff is entitle for Claim No.2
27. Claim 3: Lift charges for over-fallen quantities at exit cut amounting to Rs. 25,00,000/- .
According to plaintiff , On account of the blasting of rocks including hard rock for widening the exit canal, the quantity of hard rock which was blasted accumulated at the bottom of the canal, the same had to be removed from the canal bed at a depth of nearly 22 meters and the same had to be conveyed to the dump yard. Ex. P60 is a letter dated 01.01.1998 from the plaintiff to the defendants authorities stating the plaintiff's claims and also the detailed calculations in arriving at this claim amount. According to plaintiff, the quantity lifted is 50,000 cmtr and the lead charges is Rs. 50 per cmtr, and the total expense incurred by the plaintiff is Rs. 25,00,000/-. Actual quantity and /36/ Com.O.S.No.5370/201 actual Data Rate of clause 13(d) in the agreement in Ex. DI. The plaintiff has stated this claim amount in his plaint and examination-in- chief. The plaintiff was cross- examinationed on the said claim and on Ex. P60. Ex. P65 is a report prepared and authorised by the Executive Engineer and the Assistant Executive Engineer in the year 2000. This claim has been admitted by the defendants in this exhibit for Rs. 2,54,680/- The rate considered while submitting the proposal is the SR rate. The quantity considered by the defendants is 15,268cum but the plaintiff has actually incurred extra lead charges for a quantity of 50,000cum. Actual data 13(d) at the rate of Rs.50/- In fact, the defendant is liable to pay Rs. 25,00,000/- to the plaintiff as per Ex. P60 instead of Rs. 2,54,680/-. Ex. P70:
This exhibit is a report prepared and signed by the Assistant Executive Engineer. This report clearly states that a permanent ramp at the exit cut is to be newly constructed and a new gradient and widths for the canal are proposed. These additional works were duly completed by the plaintiff. Thus, it is evident that for construction of the said ramp and gradient the plaintiff was required to lift the huge quantities of the materials. The lift charges of S R Rate Rs.47.20+T PRs. 49.66 is admitted by the defendants. In /37/ Com.O.S.No.5370/201 cross examination of DW1 dated 29.11.2021 it is admitted that, Ex. P70 was issued by the Assistant executive engineer, counter-signed by the Executive Engineer and Superintending Engineer. The defendant witness also admitted that, Ex. P70 mentions about non-availability of dumping area and that the engineers had proposed the enhancement of lift charges by way of revised cost. Further DW1 in his cross examination dated 15.12.2021 admitted that, claim no. 3 has been approved by the competent authority and claim no. 3 has not been settled till date. In the examination in chief, the plaintiff has stated that, the quantity lifted is 50,000 cum, which is also stated in the plaint. The plaintiff was not asked any questions in cross- examination on the said claim and also on Ex. P60. Therefore, it can be safely held that, the defendant has accepted this claim.
28. Claim 4: Lead charges for the quantity disposed off exit cut amounting to Rs. 30,00,000/-
According to plaintiff, a big rock and other muck which had accumulated in the canal Bed was to be /38/ Com.O.S.No.5370/201 disposed of at the designated dump yard, as a result there has been inadequate dumping area next to the canal and the defendants having identified an alternative area at a long distance, the plaintiff incurred extra lead charges for transporting such excavated materials. The said land was at a distance of Extra one kilo metre beyond the original dumping Yard. Ex. P60: is a letter dated 01.01.1998 from the plaintiff to the defendants authorities stating the plaintiff's claims and also the detailed calculations in arriving at the claim amount. The calculations are, the quantity for extra lead charges is 50,000 cum and the lead charges is Rs. 60 per cum, and the total expense incurred by the plaintiff is Rs. 30,00,000/-. Actual quantity and actual Data Rate of clause 13(d) in the agreement in Ex. D1. The plaintiff has stated this claim amount in his plaint and examination-in-chief. The plaintiff was not cross-examined on this said claim and on Ex. P60. Ex. P65 is a report prepared and authorised by the Executive Engineer and the Assistant Executive Engineer in the year 2000. This claim has been admitted by the defendants in this exhibit for Rs. 5,57,291/- The rate considered while submitting the proposal is the SR rate. The quantity considered by the defendants is 15,268cum but the plaintiff has actually /39/ Com.O.S.No.5370/201 Extra lead a quantity of 50,000cum. Actual data 13(II) at the rate of Rs.50/- In fact, the defendants is liable to pay Rs. 30,00,000/- to the plaintiff as per Ex. P60 instead of Rs. 5,57,291/-. Ex. P70 is a report prepared and signed by the Defendants This report clearly states that a permanent ramp at the exit cut is to be newly constructed, a new gradient and width are proposed, and the said engineer clearly states that there is going to be additional lead charges, i.e. the minimum lead charges up to 1.0 km was proposed. It is also stated that there is no land available at the sides of the canal, hence the excavated materials have to be dumped at a different site for extra lead. It is thus evident that there were additional Extra lead charges incurred by the plaintiff which is clearly admitted in this exhibit by the defendants. Ex. P12 is a letter dated 15.12.1997 from the Chief Engineer to the Superintendent Engineer. The Chief Engineer states that the claims of the plaintiff with respect to de-watering, Cover Blasting, watery situation, covered blasting, extra lead charges are to be settled immediately. Ex. P14 dated 06.12.1997, Ex. P19 dated 06.12.1997 and Ex. P27 dated 02.12.1997: These exhibits are letters from the plaintiff to the defendants authorities seeking payment for the extra lead charges.
/40/ Com.O.S.No.5370/201 In the cross examination of DW1 dated 29.11.2021 it is admitted that Ex. P70 was issued by the Assistant Executive Engineer and counter-signed by the Executive Engineer and Superintending Engineer. The witness also admitted that Ex. P70 mentions about non-availability of dumping area and that the engineers had proposed its enhancement by way of Extra lead charges revised cost. DW1 admitted that claim no. 4 has been approved by the competent authority and same has been not settled till date. Therefore, in light of the above it could be held that plaintiff is entitle for the above claim.
20.Claim 5: Payment for excavation of canal side slopes at exit cut amounting to Rs. 83,50,000/-
It is the contention of plaintiff that, on account of the adverse geological conditions, the side slopes at the exit cut were not stable. In order to impart stability to the canal slope and to ensure the Permanent safety of the canal, the defendants directed the plaintiff to ease Widening the side slopes of the exit cut. Such work was executed by the plaintiff under the directions and with the knowledge of the defendants. Ex. P60 is a letter dated 01.01.1998 from the /41/ Com.O.S.No.5370/201 plaintiff to the defendants authorities stating the plaintiff's claims and also the detailed calculations in arriving at the claim amount. The calculations are, the total length is 210M, the average depth of cut is 28M, therefore, 210xAv.width 6.50x Av. D/C 24.50 33,400cmtr, and 33,400x actual data rate as per clause 13(d) of Agreement i.e., rate Rs. 250 Rs. 83,50,000/-. The said amount is the actual Executed quantity and actual Data Rate of clause 13(d) in the agreement in Ex. DI. The plaintiff has stated this claim amount in his plaint and examination-in-chief. The plaintiff was not cross- examined on the said claim and on Ex. P60. Ex. P7: is a letter dated 19.11.1996 from the Chief Engineer to the Secretary of the Irrigation Department. The Chief Engineer has submitted a proposal for easing of side slopes at the exit cut canal and thus the excavation of the canal side slopes at the exit cuts. Thus due to the widening of the side slopes the plaintiff was required to excavate huge amounts of quantity from the canal side slopes at the exit cut. The defendants authorities have thus admitted that the costs incurred by the plaintiff for this claim is Rs.39,90,000/-In the cross examination of DWI dated 27.10.2021 he has admitted the contents of Ex. P7. Ex. P8 is a letter dated 23.03.1996 from the plaintiff to /42/ Com.O.S.No.5370/201 the Executive Engineer that the canal side slopes have to be eased.Ex. P10 dated 15.12.1997 and Ex. P11 dated 15.12.1997 are letters from the Chief Engineer to the Superintending Engineer that the widening of canal at exit cut is completed and approved payment may be made to the plaintiff. Ex. P13 is a letter dated 06.12.1997 from the plaintiff to the Chief Engineer. in which plaintiff stated that, the canal side slopes have been widened and easened and that the defendants authorities must make payment for the same, and that unless payment is settled the plaintiff will not be held responsible for the delay in completion of work. Ex. P9, Ex. P12, Ex. P16, Ex. P18 and Ex. P22 are letters from the defendant engineers to the defendants authorities to make payments for the various claims raised by the plaintiff.
In cross examination of DW2 dated 15.12.2021 he has admitted that the plaintiff has achieved a progress of Rs. 80,00,000/- (Rupees eighty lakhs) in executing claim no. 5. Therefore, it is clear that, defendants have admitted that, the plaintiff has incurred an expenditure of Rs. 80,00,000/-. Ex. P21 is a letter dated 02.12.1997 from the plaintiff to the defendants authority seeking due payments /43/ Com.O.S.No.5370/201 for the work completed in widening the exit cut of canal And Exp16 dated 20.10.1997 towards tunnel extra length 11M and side slopes easaning exit canal EFI separetly enclosed Tunnel cost. For the above reason it is held that plaintiff is entitle for the above claim.
30.Claim 6: Release of payments for the quantity exceeding 125% beyond the tender quantity amounting to Rs. 18,42,000/-
The defendants have from time to time directed the plaintiff to do the additional work and where such work exceeds 125% of the contract quantity, the plaintiff was entitled to receive payment. Ex. P60 is a letter dated 01.01.1998 from the plaintiff to the defendants authorities stating the plaintiff's claims and also the detailed calculations in arriving at the claim amount. The calculations are, excavation under full face tunnel 1800cum X (2000-1590)410 Rs.7,38,000. C.C 1:5:10 110cum X (1800-1400)400= Rs.44,000/-, widening canal 10,000cum X (250-144)106 10,60,000, and the total amount incurred by the plaintiff amounts to Rs.18,42,000/-. The said amount is the actual quantity and actual Data Rate of /44/ Com.O.S.No.5370/201 clause 13(d) in the agreement in Ex.DI. The plaintiff has stated this claim amount in his plaint and examination-in- chief. The plaintiff has not been cross- examined on this issue and also on Ex. P60.. This claim has admitted by the defendants in their written statement at para no. 45 at page no. 24, and in their examination in chief in para no. 42 at page no.22 for an amount of Rs. 9,67,288/-, However, the reserved amount in bill to be released Wide VR No.07/12.1997 Rs.5,66,704/-The defendants in their cross- examination dated 29.11.2021 admitted that the plaintiff had to executed the work for extra 11 meters of length of tunnel. DW1 in his cross examination dated 15.12.2021 admitted that, claim no. 6 has been approved by the competent authority. In the cross examination of DWI dated 15.12.2021 it is admitted that claim no. 6 has not been settled till date. Therefore, it can be held that, the defendants has accepted this claim.
31. Claim 7: Payments for work completed under watery situation amounting to Rs. 18,16,560/- it is the case of plaintiff that, during the work conducted by the plaintiff, on account of the geological condition, the plaintiff had to work in watery situation on account of /45/ Com.O.S.No.5370/201 frequent flooding and heavy seepage of water into the site. The work was carried on by the plaintiff in under watery situation, which necessitated additional cost to the plaintiff.Ex. P60 is a letter dated 01.01.1998 from the plaintiff to the defendants authorities stating the plaintiff's claims and also the detailed calculations in arriving at the claim amount. The plaintiff has not been cross examined by the defendant on this claim and on Ex. P60. Ex. P65 is a report prepared and authorised by the Executive Engineer and the Assistant Executive Engineer in the year 2000. This claim has been admitted by the defendants in this exhibit for Rs. 18,16,560/-. Ex. P12 is a letter dated 15.12.1997 from the Chief Engineer to the Superintendent Engineer. The Chief Engineer states that the claims of the plaintiff with respect to dewatering, under watery situation and lead charges are to be settled immediately. Ex. P7 is a letter dated 19.11.1996 from the Chief Engineer to the Secretary of the Irrigation Department. The Chief Engineer admits to the fact that there is seepage of ground water and folded nature of the rock formation, all of which makes it very difficult to construct the canal. Ex. P14 dated 06.12.1997, Ex. P19 dated 06.12.1997 and Ex. P27 dated 02.12.1997 are letters from the plaintiff to the defendants authorities /46/ Com.O.S.No.5370/201 seeking payment for working in under watery situation. Therefore, it can be held that, the defendants have accepted this claim.
32. Claim 8: Operation of ramp quantities at approach cut cover blasting amounting to Rs. 6,57,712/- The plaintiff constructed a ramp in the approach cut by adopting controlled blasting (covered blasting). Though the defendants paid certain amounts in respect of the same, there is a difference rate of nearly Rs.176/- per cubic meter quantity of 3737cum. Ex. P60 is a letter dated 01.01.1998 from the plaintiff to the defendants authorities stating the plaintiff's claims and also the detailed calculations in arriving at the claim amount. The calculations in arriving at this claim amount are, 5000cum x (320-144)176 Rs.8,80,000/-. The plaintiff has now claimed only 3737cum x (320-144)176-Rs. 6,57,712/-. The plaintiff has stated this claim amount in his plaint and examination-in- chief. The plaintiff was not cross examined on the said claim and on Ex. P60. Ex. P4 is a letter dated 28.05.1999 from the Executive Engineer to the Chief Engineer. The Executive Engineer states that there are several inhabitants in the surrounding construction area and hence continuation of /47/ Com.O.S.No.5370/201 the plaintiff's construction work has become impossible. Apart from this, the plaintiff has to stop using the normal blasting as stated in the contract, and instead has to use covered blasting, i..e controlled blasting. The engineer in fact states that, the cost of using covered blasting would cost more amount of money and that there should be immediate sanction of the said covered blasting. The defendants admit that additional cover blasting was required to be done which would amount to Rs. 6,57,712/- extra cost EFI. 3737cum X 9320-144) 176 Rs.6,57,712/- Ex. P65 is a report prepared and authorized by the Executive Engineer and the Assistant Executive Engineer in the year 2000. This claim has been admitted by the defendants in this exhibit for Rs. 6,57,712/-, having considered the calculation, i.e. 3737cum X (320-144)176 = Rs.6,57,712/- This claim has been fully admitted by the defendants in their written statement at para no.47 at page no. 25, and in their examination in chief in para no.44 at page no. 23. DWI further admitted that, claim no. 8 has not been settled till date. Ex. P14 dated 06.12.1997, Ex. P19 dated 06.12.1997 and Ex. P27 dated 02.12.1997 are letters from the plaintiff to the defendants authorities seeking payment for extra cover blast. Therefore, it can be /48/ Com.O.S.No.5370/201 held that the defendant has accepted this claim.
33.Claim 9: Payment of extra rates for tunneling items executed with diesel power amounting to Rs.24,26,000/-
a) According to plaintiff, In terms of the Contract agreement, supply of power was the responsibility of the defendants, which failed to provide said electricity. The plaintiff conducted the entire work by utilizing diesel power. Ex. P60 letter dated 01.01.1998 from the plaintiff to the defendants authorities stating the plaintiff's claims and also the detailed calculations in arriving at the claim amount. The calculations in arriving at this claim are, tunneling using diesel power 4000cum X500=20,00,000 + 2000cum X 500 10,00,000+ lining c.c 3000cum X 500-15,00,000, and the total claim amount arrived at is Rs 45,00,000/-. The total tunnel cost 246 Lakhs X 13.36% 32.86 Lakhs executed amount as per Ex. P84 and which is now claimed is Rs.181.65 lakhs X 13.36%- Rs. 24,26,000/-. ExP-62 - Page No. 174. Plaintiff letter dated 07.02.2000 to EE informing that they have failed to fulfil the contractual obligation of providing KEB Power Supply and executed work completely by utilizing diesel power and requested for /49/ Com.O.S.No.5370/201 reimbursement of expenditure Ex. P65 is a report prepared and authorised by the Executive Engineer and the Assistant Executive Engineer in the year 2000. This claim has been admitted by the defendants in this exhibit for Rs. 53,56,000/-. The defendants clearly state that the contractor has done the tunnel work entirely with the power generated by his own diesel powered generator since KEB power supply was not available and plaintiff has not been cross examined on these documents and issues. In cross examination of DWI dated 15.12.2021 he admitted that, throughout the contractual period there was no supply of electricity and that the plaintiff had to make its own arrangement. It is further admitted that the running bills had not taken in to account money spent by the plaintiff towards purchase of diesel for generation of electricity. Therefore, it can be held that the defendant has accepted this claim.
34.Claim 10: Compensation for stoppage of work due to reasons beyond the control of the plaintiff amounting to Rs.8,52,500/-
plaintiff contended that, there were several delays occasioned by the defendants on account of various reasons /50/ Com.O.S.No.5370/201 including alterations and changes proposed by the defendants, non-supply of structural steel, delays in issuing Constructed drawings etc., all of which resulted in frequent stoppage of work by the plaintiff rendering the men and machinery idle. The plaintiff was not cross-examined on this claim and on Ex. P60. Ex. P22 dated 02.12.1997, Ex. P42 dated 20.12.1997, Ex. P43 dated 07.12.1997, Ex. P47 dated 28.10.1997 and Ex. P48 dated 31.10.1997 These exhibits are several letters written between the various defendants engineers to the defendants authorities repeatedly asking the defendants authority to approve and submit Execute grouting drawings to the plaintiff. These letters are in fact admissions by the defendants authorities themselves that the grouting drawings were not provided to the plaintiff and were delayed by several years. Grouting drawings was essential to the Execute of the Tunnel and approach, exit canal. Therefore, the plaintiff had to stop his work and wait to receive the drawings, in order to move forward with the construction activities. Ex. P38 dated 22.01.1998, Ex. P44 dated 04.11.1997, Ex. P45 dated 20.01.1998, Ex. P46 dated 19.11.1997 and Ex. P57 dated 05.03.1998 These exhibits are several letters written by the plaintiff to the defendants authorities repeatedly requesting /51/ Com.O.S.No.5370/201 for issuance of Executing grouting drawings. It is due to the above factors, that the plaintiff was forced to stop his work and wait for grouting drawings in order to proceed with the construction. The grouting drawings was required to be supplied by the defendants and as evident in the above paragraphs, the grouting drawings were not given even as late as December 1997. Therefore, it can be held that the defendant has accepted this claim.
35.Claim 11: Additional rates for non-realization of the contemplated pull amounting to Rs.23,91,372/- The defendants have anticipated a pull of 1.5 meters per blasting Rate Prepared in respect of the tunnel works. However, the actual Lesser Tunnel pull that was achieved was only 0.80 to 0.9 meters per blast and the same was as a result of the characteristic of the rock being hard rock. Ex. P65 is a report prepared and authorised by the Executive Engineer and the Assistant Executive Engineer in the year 2000. This claim has been admitted by the defendants in this exhibit for Rs. 23,91,372/-. The defendants state that the Tunnel pull assumed by the defendants was 1.5 mt per blast. However, the defendants clearly state that the actual Tunnel Lesser pull achieved by /52/ Com.O.S.No.5370/201 the plaintiff was only 0.90 mt per blast. According to plaintiff,t he calculation is, 6000 cum X rate of 400/cmtr Rs. 24,00,000/-. The plaintiff has stated this claim amount in his plaint and examination-in-chief. The plaintiff has not been cross examined by the defendant on this claim nor on Ex. P60. Ex. P35 is a letter dated 27.02.1996 from the plaintiff to the Executive Engineer. The plaintiff states that despite using various drilling patterns there is difficulty in securing better Tunnel pull during blasting. Further, when the defendants had stated that a Tunnel pull of 1.5 m would be achieved, in reality the average Tunnel pull that is achieved is only 0.8 to 0.9 m. This establishes the fact that due to the presence of hard rock and adverse geological conditions, the effectiveness of blasting was greatly reduced. This led to more expenditure by the plaintiff since more blasting was required to be used for more time, which caused slow progress of work. Therefore, it can be held that the defendant has accepted this claim.
36.Claim 12: payment of equitable price for the quantum of work executed in the prolonged period beyond the stipulation date of completion. and Claim 13: Payment of additional monthly overhead charges for /53/ Com.O.S.No.5370/201 the prolonged period beyond the stipulated date of completion until the virtual date of completion together amounting to Rs.138.97 lakhs In view of the defendant's various breaches and delays, the project could be completed only in 2000 resulting in delay of over four years. The plaintiff is entitled to claim expenditures for the work executed in such prolonged period as also overheads including escalation. Ex. P60 dated 01.01.1998. ExP61, ExP62, ExP63 are the letters from the plaintiff to the defendants authorities stating the plaintiff's claims and also the detailed calculations in arriving at the claim amount. The plaintiff has not been cross esamined on this issue nor on these documents.Ex. P65 is a Claim Admitted and authorised by the Executive Engineer and the Assistant Executive Engineer in the year 2000. This claim has been admitted by the defendants. Ex. P22 dated 02.12.1997, Ex. P42 dated 20.12.1997, Ex. P43 dated 07.12.1997, Ex. P47 dated 28.10.1997 and Ex. P48 dated 31.10.1997 . These exhibits are letters written between the various defendants engineers to the defendant authorities repeatedly asking the defendants authority to approve and submit grouting /54/ Com.O.S.No.5370/201 drawings to the plaintiff. These letters are in fact admissions by the defendants authorities themselves that the Executing grouting drawings were not provided to the plaintiff and were delayed by several years. Grouting drawings were essential to the Execute of the Tunnel. Therefore, the plaintiff to Delay his work and wait to receive the drawings, in order to move forward with the construction activities. Ex. P38 dated 22.01.1998, Ex. P44 dated 04.11.1997, Ex. P45 dated 20.01.1998, Ex. P46 dated 19.11.1997 and Ex. P57 dated 05.03.1998. These exhibits are several letters written by the plaintiff to the defendant authorities repeatedly requesting for issuance of Execute grouting drawings.Ex.P9 dated 20.12.1997, P10 dated 15.12.1997, Ex. P11 dated 15.12.1997, Ex. P12 dated 15.12.1997, Ex. P18 dated 15.12.1997, Ex. P50 dated 24.01.2000, Ex. P52 dated 13.01.2000, Ex. P53 dated 16.06.1999, Ex. P54 dated 27.05.1999, Ex. P68 dated 1999-2000, Ex. P69 dated December 2000, Ex. P70, Ex. P75 dated 01.06.2002, D27 dated 20.01.1997, Ex. D28 dated 16.01.1997 and Ex. D36 dated 26.08.2000. These exhibits are letters from the defendants engineers to the defendants authorities stating that payments to the plaintiff have to be made. Ex. P4 dated 28.05.1999, Ex. P13 dated /55/ Com.O.S.No.5370/201 06.12.1997, Ex. P14 dated 06.12.1997, Ex. P15 dated 02.12.1997, Ex. P16 dated 20.12.1997, Ex. P19 dated 06.12.1997, Ex. P20 dated 06.12.1997, Ex. P21 dated 02.12.1997, Ex. P23 dated 02.12.1997, Ex. P24 dated 02.12.1997, Ex. P25 dated 02.12.1997, Ex. P26 dated 02.12.1997, Ex. P27 dated 02.12.1997, Ex. P33 dated 07.05.1997, Ex. P34 dated 15.03.1997, Ex.P35 dated 27.02.1996, Ex. P36 dated 26.09.1996, Ex. P37 dated 20.01.1996, Ex. P38 dated 22.01.1997, Ex. P49 dated 06.09.1997, Ex.P55 dated 05.06.1998, Ex. P56 dated 04.04.1998, Ex. P57 dated 05.03.1998, Ex. P58 dated 11.02.1998, Ex. P59 dated 13.04.1996, Ex. P60 dated 01.01.1998, Ex. P61 dated 17.03.1998, Ex. P62 dated 07.02.2000, Ex. P63, Ex. P71 dated 25.02.2002, Ex. P72 dated 09.03.2002, Ex. P73 dated 25.03.2002, Ex. P74 dated 15.04.2002, Ex. P76 dated 15.06.2002, Ex. P77 dated 17.04.2003 and Ex. P78 dated 02.07.2002: These exhibits are letters from the plaintiff to the defendants authorities requesting for payment for claims, wherein costs incurred is Rs.48,00,000+ 107.91 lakhs 155.91 lakhs, and the plaintiff is now claiming Rs. 138.97 lakhs. on careful reading of these exhibits it is very clear that, there were delays in issuing drawings and also for making due payments to the /56/ Com.O.S.No.5370/201 plaintiff from the defendants. DW1 in his cross examination dated 27.10.2021 admitted that, the variation in the work during the progress and contract period will be approved by defendants. In the cross examination of DW1 dated 29.11.2021 it is admitted that as per Ex. P7 due to the inaccurate report of the geologist there was delay caused to the plaintiff in completing his work. Hence I hold that plaintiff is entitle for above claims.
38.Claim No.14: Payment of compensation for idle charges of men and machinery amounting to Rs.36,63,000/-
Plaintifgf contended that, on account of delays in supplying the steel despite several reminders and on account of direction to stop the work, the plaintiff lost out nearly 37 days of work, for such period the plaintiff had to keep its men and machinery idle resulting in huge monetary loss. Ex. P63 is a letter from the plaintiff to the Chief Engineer showing the detailed calculations in arriving at this amount. plaintiff has not been cross examined on this Ex. P63. Ex. P22 dated 02.12.1997, Ex. P42 dated 20.12.1997, Ex. P43 dated 07.12.1997, Ex. P47 dated 28.10.1997 and Ex. P48 dated 31.10.1997: These exhibits are letters written /57/ Com.O.S.No.5370/201 between the various defendants engineers to the defendants authorities repeatedly asking the defendants authority to approve and submit grouting drawings to the plaintiff. In these letters defendants authorities themselves admitted that the grouting drawings were not provided to the plaintiff and were delayed by several years. Grouting drawings was essential to the foundation of the canal. Therefore, the plaintiff to stop his work and wait to receive the drawings, in order to move forward with the construction activities.Ex. P38 dated 22.01.1998, Ex. P44 dated 04.11.1997, Ex. P45 dated 20.01.1998, Ex. P46 dated 19.11.1997 and Ex. P57 dated 05.03.1998: These exhibits are also letters written by the plaintiff to the defendants authorities repeatedly requesting for issuance of Execute grouting drawings. Ex. P9 dated 20.12.1997, P10 dated 15.12.1997, Ex. P11 dated 15.12.1997, Ex. P12 dated 15.12.1997, Ex. P18 dated 15.12.1997, Ex. P50 dated 24.01.2000, Ex. P52 dated 13.01.2000, Ex. P53 dated 16.06.1999, Ex. P54 dated 27.05.1999, Ex. P68 dated 1999-2000, Ex. P69 dated December 2000, Ex. P70, Ex. P75 dated 01.06.2002, D27 dated 20.01.1997, Ex. D28 dated 16.01.1997 and Ex. D36 dated 26.08.2000 These are letters from the defendants engineers to the defendants authorities stating that /58/ Com.O.S.No.5370/201 payments to the plaintiff have to be made.
Ex. P4 dated 28.05.1999, Ex. P13 dated 06.12.1997, Ex. P14 dated 06.12.1997, Ex. P15 dated 02.12.1997, Ex. P16 dated 20.12.1997, Ex. P19 dated 06.12.1997, Ex. P20 dated 06.12.1997, Ex. P21 dated 02.12.1997, Ex. P23 dated 02.12.1997, Ex. P24 dated 02.12.1997, Ex. P25 dated 02.12.1997, Ex. P26 dated 02.12.1997, Ex. P27 dated 02.12.1997, Ex. P33 dated 07.05.1997, Ex. P34 dated 15.03.1997, Ex. P35 dated 27.02.1996, Ex. P36 dated 26.09.1996, Ex. P37 dated 20.01.1996, Ex. P38 dated 22.01.1997, Ex. P49 dated 06.09.1997, Ex. P55 dated 05.06.1998, Ex. P56 dated 04.04.1998, Ex. P57 dated 05.03.1998, Ex. P58 dated 11.02.1998, Ex. P59 dated 13.04.1996, Ex. P60 dated 01.01.1998, Ex. P61 dated 17.03.1998, Ex. P62 dated 07.02.2000, Ex. P63, Ex. P71 dated 25.02.2002, Ex. P72 dated 09.03.2002, Ex. P73 dated 25.03.2002, Ex. P74 dated 15.04.2002, Ex.P76 dated 15.06.2002, Ex. P77 dated 17.04.2003 and Ex. P78 dated 02.07.2002: These are letters from the plaintiff to the defendants authorities requesting for payment for claims, wherein costs incurred is Rs.48,00,000+ 107.91 lakhs 155.91 lakhs, and the plaintiff is now claiming Rs.138.97 lakhs. If we peruse the above exhibits it is very clear that, /59/ Com.O.S.No.5370/201 there were delays in issuing drawings approach, exit canal widening construction and also for making due payments to the plaintiff from the defendants which lead the plaintiff to make his men and machinery wait until the construction drawings and payments were made by the defendants to the plaintiff and same caused huge expenses and expenditures to the plaintiff. Though whether or not work is undertaken by the plaintiff, the plaintiff incurred an expenditure of Rs.99,000, per day in order to maintain and pay for the men and machinery at the construction site 37 days. In Ex. P87 which is a letter dated 24.05.1995 from the defendants authority to the Chief Engineer, the Chief Engineers pecifically stated that the plaintiff would be provided with steel and cement, the same clause is also found in Schedule A of the agreement.Ex. P28 dated 04.06.1996, Ex. P29 dated 02.02.1996, Ex. P30 dated 11.09.1996, Ex. P31 dated 05.03.1997: These exhibits are letters from the defendants authorities to the plaintiff granting permission to the plaintiff to purchase structural steel without any extra cost on the plaintiff. Thus, the defendants acted contrary to the contract by failing to provide the steel to the plaintiff. Inspite of the fact that, the contract being entered into on 10.07.1995 the defendants even as late as 05.03.1997 as /60/ Com.O.S.No.5370/201 evident in Ex. P31 , defendatns failed to provide even the structural steel, which was the primary material required for construction. Therefore, I hold plaintiff is entitle for this claim.
39.Claim 15: Return of the penalty amount recovered from the work bills amounting to Rs.6,00,000/-
It is the case of plaintiff that, the defendant had deducted a sum of nearly Rs.6 lakhs from various bills of the plaintiff, which was illegally deducted and has to be paid to the plaintiff. He relied on clause 2(c) of the Agreement, which ismarked as Ex. D1 and in the said the agreement there is a clause that, if there is a delay in the progress of work, the defendant can levy a penalty amount only after the matter is examined, a record is made of the same, and the said record is signed in full by both the executive engineer and the contractor. In the case in hand, there is no such examination or report prepared and signed by the plaintiff. Therefore, it is clear that, the levy of penalty amount by the defendants is illegal and contrary to the express clause of the contract. Hence it would be proper to order for areturn of the penalty amount to the plaintiff.
/61/ Com.O.S.No.5370/201
40.Claim 16: Release of FSD amounting to Rs.19,33,688/-
plaintiff claimed that, the defendants deducted FSD deposit at 6%% of the bills while making payments and an amount of Rs. 19,33,688/- has thus been deducted as FSD and is now lying with the defendant. under Ex. P65 is the report prepared by the Executive Engineer and the Assistant Executive Engineer in the year 2000 wherein this claim has been admitted by the defendants that the FSD amount can be released to the plaintiff. Ex. P63a letter from the plaintiff to the Chief Engineer requesting for release of FSD amount.Ex. P85 is a letter dated 6.08.2000 from the plaintiff to the Executive Engineer praying for return of FSD, the calculations are Rs. 18,33,688+1,00,000 balance FSD Rs. 19,33,688/- Defendants to refund the FSD Reals the FSD EXP67 dated 3.10.2000.
41.Claim 17: Pending payment of balance amount as per 18th & Part Bill amount & EMD amounting to Rs.31,75,000/-
/62/ Com.O.S.No.5370/201 It is the contention of plaintiff that, though he completed tunnel works by 10.2.2000, defendants did not considered the final bill. The 18th part bill prepared by the defendants remained unpaid even as on date. The plaintiff had deposited EMD of Rs.9.4 lakhs in Kamadhenu deposit, which is maintained by the defendants. The same is liable to be released to the plaintiff. he relied on Ex P84: is the 18th & Part Bill dated 19.07.2003 prepared by the defendants authorities, and signed by the Assistant Executive Engineer. in the said billl it is shown that an amount of Rs. 22,35,063/- is due from the defendants to the plaintif and the said amount is yet to be paid by the defendants to the plaintiff. Ex. P86s a letter from the plaintiff to the defendants under which The plaintiff sought the return of the security deposit of Rs. 9.40 lakhs, and in return issued a Bank guarantee in favour of the defendants authority. As per clause 1(d) of the Agreement Ex. DI, the defendants authorities were required to release the security deposit as soon as the plaintiff issues a bank guarantee. The defendants have breached this clause of the contract, despite the plaintiff being duly entitled to receive the security deposit from the defendants. The defendants in their cross-examination dated 27.10.2021 admitted that the /63/ Com.O.S.No.5370/201 last column of Ex. P84 reflects the actual work done pending bill and that as per Ex. P84, the amount which was due to be paid was Rs. 22,35,063/- and also admitted that the defendants have not taken any action in respect of this claim. DW1 admitted that the 18th bill is only a part bill. DW1 admitted that, completion certificate has been issued the plaintiff. It is clear that, even though the canal became operational in the year 1998, the completion certificate was issued only several years later. In view of this I hold plaintiff is entitle for above claim.
42.Claim No. 18: plaintiff has pleaded that, 24% per annum interest on the due payments as well as claims amounts accrued calculated from 10.7.1996 to 10.7.2016. The total amount due to plaintiff as on 11.7.2016. Rs.31,91,02,080/-. The plaintiff contended that he has suffered damages amounting to crores of rupees on account of delays on part of the defendants. As and when expenditure arose for the afore-mentioned claims, the plaintiff wrote to the defendants seeking payment. Ex. P9 dated 20.12.1997, P10 dated 15.12.1997, Ex. P11 dated 15.12.1997, Ex. P12 dated 15.12.1997, Ex. P18 dated 15.12.1997, Ex. P50 dated 24.01.2000, Ex. P52 dated /64/ Com.O.S.No.5370/201 13.01.2000, Ex. P53 dated 16.06.1999, Ex. P54 dated 27.05.1999, Ex. P68 dated 1999-2000, Ex. P69 dated December 2000, Ex. P70, Ex. P75 dated 01.06.2002, D27 dated 20.01.1997, Ex. D28 dated 16.01.1997 and Ex. D36 dated 26.08.2000. These are letters from the defendant engineers to the defendant authorities stating that payments to the plaintiff have to be made. Ex. P4 dated 28.05.1999, Ex. P13 dated 06.12.1997, Ex. P14 dated 06.12.1997, Ex. P15 dated 02.12.1997, Ex. P16 dated 20.12.1997, Ex. P19 dated 06.12.1997, Ex. P20 dated 06.12.1997, Ex. P21 dated 02.12.1997, Ex. P23 dated 02.12.1997, Ex. P24 dated 02.12.1997, Ex. P25 dated 02.12.1997, Ex. P26 dated 02.12.1997, Ex. P27 dated 02.12.1997, Ex. P33 dated 07.05.1997, Ex. P34 șlated 15.03.1997, Ex. P35 dated 27.02.1996, Ex. P36 dated 26.09.1996, Ex. P37 dated 20.01.1996, Ex. P38 dated 22.01.1997, Ex. P49 dated 06.09.1997, Ex. P55 dated 05.06.1998, Ex. P56 dated 04.04.1998, Ex. P57 dated 05.03.1998, Ex. P58 dated 11.02.1998, Ex. P59 dated 13.04.1996, Ex. P60 dated 01.01.1998, Ex. P61 dated 17.03.1998, Ex. P62 dated 07.02.2000, Ex. P63, Ex. P71 dated 25.02.2002, Ex. P72 dated 09.03.2002, Ex. P73 dated 25.03.2002, Ex. P74 dated 15.04.2002, Ex. P76 dated /65/ Com.O.S.No.5370/201 15.06.2002, Ex. P77 dated 17.04.2003 and Ex. P78 dated 02.07.2002. These are letters from the plaintiff to the defendant authorities requesting for payment for claims. The defendants have admitted that there was delay on their part. Hence I hold plaintiff is entitle for above claim.
15. If we peruse the documentaruy evidence of defendants, they relied on ExD 1 to 82 which are copy of tender, proceedings of government, letter correspondences with plaintiff and also with the authorities of PWD department. The learned counsel for defendant while addressing arguments argued that,agreement date3d 10.7.95 has not been produced by the plaintiff. In my opiunion when the defendats have not disputed the suit transaction and admitted swome of the claims of plaintiff, question of non producing above agreement cannot be held fatal to the case of plaintiff. Defendants further argued that plaintiff has not produced any documents to show that he is entitle for above claims. In my opinion the documents produced by the plaintiff and the letter addressed to the authorities of defendants themselves are suffice to hold that, defendants are liable to pay the suit claim amount with intrest as prayed by the plaintiff in the plaint.
/66/ Com.O.S.No.5370/201
16. I have gone through the decisions relied by plaintiff which are as hereunder;
1. ILR (2010) 2 Del 699 (1-29) Even if there is a breach of contract, damages cannot be claimed by contractor in view of contract between parties, rights under Section 73 and 55 of Contract Act cannot be waived. Contractual clauses which disentitle aggrieved party to benefits of Sections 55 and 73 would be void being violative of Section 23 of Contract Act.
2. 2023 SCC OnLine Del 8044 (Para 19) (30-84) Clauses which restrict the right of the party in claiming damages is a restrictive clause that defeat the purpose of the Indian Contract Act. 1872. Under Section 55 and 73 of the said Act, the aggrieved party is entitled to claim damages, and there cannot be any restriction or prohibition exercised by the other party It is the right of the aggrieved party to claim such damages. Under section 23 of the Indian Contract Act, 1872, states /67/ Com.O.S.No.5370/201 that such clause is opposed to public policy since it aims at restraining the aggrieved party from claiming its rightful dues. Such kind of clauses are also not in public interest since they hinder the smooth operation of the commercial transactions.
IN CASE OF CONFLICT BL SES IN A CONTRACT. THE EARLIER CALUSE WILL PREVAIL OVER THE LATTER
3. 1921 SCC Online PC 102 (Para 8) (85-88)
4. AIR 1959 SC 24 (Para 13) (89-98)
5. AIR 1963 SC 890 (Para 12) (99-110)
6. 2024 (4) SCC 318 (111-122) In case of a conflict between clauses in a contract, the earlier clause will prevail over the latter.
(Para 32) /68/ Com.O.S.No.5370/201 CONTRA PROFERETEM
7. (2009) 5 SCC 313 (123-147) In case of ambiguity of unclear terms in a contract, the rule is that interoretation shall be against the party that framed the terms. (Para 28, 31 and 32)
8. (2021) SCC OnLine SC 1207 (148-175) The rule of contra proferentem thus protects the insured from the vagaries of an unfavourable interpretation of an ambiguous term to which it did not agree. The rule assumes special significance in standard form insurance policies, called contract d' adhesion or boilerplate contracts, in which the insured has little to no countervailing bargaining power. (Para 30-33)
9. 2022 SCC OnLine SC 509, 2022 SCC OnLine SC 1132 (176-185, 186) The findings in (2021) SCCOnLine SC 1207 were upheld in /69/ Com.O.S.No.5370/201 2022 SCC OnLine SC 509. A review petition was filed in that came to be dismissed.
(Para 29, Para 1-4 respectively) NO NEED FOR DECLARATION OF VOID CONTRACTS
10. (2009) 10 SCC 552 (187-199)(Para 19) It is well established that a contract is void if prohibited by a statute under a penalty, even without express declaration that the contract is void, because such a penalty implies a prohibition.
SEVERABILITY OF FORCEABLE CLAUSES
11. (2006) 2 SCC 628 (200-210) The proper test for deciding validity or otherwise of an agreement or order is 'substantial severability' and not textual divisibility'. It is the duty of the court to severe and separate trivial or technical part by retaining the main or substantial part and by giving effect to the latter if it is legal, lawful and otherwise enforceable. In such cases, the /70/ Com.O.S.No.5370/201 Court must consider the question whether the parties could have agreed on the valid terms of the agreement had they known that the other terms were invalid or unlawful. If the answer to the said question is in the affirmative, the doctrine of severability would apply and the valid terms of the agreement could be enforced, ignoring invalid terms.
DAMAGES ARE INCURRED WHEN THE PARTY SUFFERS LOSS ON ACCOUNT OF BREACH OF CONTRACT
1. AIR 1965 SC 1981 (1-6)(Para 14) The appellant, on the breach of contract by the respondent, was entitled, under S. 73 of the Contract Act, to receive compensation for any loss by the damage caused to him which naturally arose in the usual course of business from such breach or which the parties knew when they made the contract to be likely to result from the breach of it.
2. 2002 (4) SCC 45 (7-19)(Para 15) Despite there being a contract between the parties /71/ Com.O.S.No.5370/201 whereunder the contractor has undertaken not to make any claim for delay in performance of contract occasioned by an act of an employer, a claim for damages, idle charges, escalation, and interest would still be an acceptable claim if the contractor makes it clear that escalation of rates or compensation for delay shall have to be made by the employer and the employer accepts performance by the contractor in spite of delay and such notice by the contractor putting the employer on terms.
3. (1999) 6 SCC 667 (20-106)(Para 128) The object of an award of damages is to give the plaintiff compensation for damage, loss or injury he has suffered.
4. 2006 (11) SCC 181 (107-164)(Para 10 & 83) As per Section 55 of the Indian Contract Act, if performance delayed beyond agreed period, damages payable (para 83).
5. (1974) 2 SCC 231 (165-179)(Para 11) The only right which the party aggrieved by the breach of /72/ Com.O.S.No.5370/201 the contract has is the right to sue for damages.
П. MEASURE OF DAMAGES
6. 1984(4) SCC 59 (180-187)(Head Note & Para 9 & 12) Damages claimed by the Contractor where Government committed breach by improperly rescinding the contract. Held - Contractor is entitled to damages for loss of expected profit. For estimating the amount of damages, Court should make a broad evaluation instead of going into minute details.
7. 1999(3) SCC 500 (188-195) The work contract awarded to the appellant. Superintending Engineer is alleged to have obstructed the progress of the work resulting in the contract not being completed. On the ground that appellant has not completed even 10% of the work, contract was terminated. Contract found to have been improperly rescinded and thereby breach of contract was committed by the respondent. Contractor claiming damages. Held Contractor is entitled to /73/ Com.O.S.No.5370/201 claim damages for loss of profit which he expected to earn by undertaking the contract.
8. 2011(10) SCC 573 (196-214)(Para 39) Where Government is proved to have committed breach for estimating the amount of damages court should make a broad evaluation instead of going into minute details...In case of breach of contract, contractor is entitled to claim damages for loss of profit which he expected to earn by undertaking the contract.
9. AIR 1964 MP 101 (DB) (215-229)(Para 48) Fact that damages cannot be assessed does not relieve wrong doer of necessity to pay damages.
IIL. ESCALATION AND IDLE CHARGES
10. (2017) 8 SCC 146 (230-245)(Head Note B) Price Escalation Clause would apply to belated period and would not be limited by ceiling provided in escalation clause. Price Escalation in performing contract is normal in /74/ Com.O.S.No.5370/201 age of inflation.
11. 2007 (13) SCC 43(246-255)(Para18, 25, 26, 31-34) In the absence of any price escalation clause in the Original Agreement and a specific prohibition to the contrary in the Supplemental Agreement, whether the appellant could have made any claim on account of escalation of cost... It is quite apparent that the appellant was prevented by unforeseen circumstances from completing the work within the stipulated period of eleven months and that such delay could have been prevented had the State Government stepped in to maintain the law and order problem which had been created at the work site. It is also clear that the rubble and metal, which should have been available at the departmental quarry at Mannady, had to be obtained from quarries which were situated at double the distance, and even more, resulting in doubling of the transportation charges. Even the space for dumping of excess earth was not provided by the respondents which compelled the appellant to dump the excess earth at a place which was far away from the work site entailing extra costs for the same. In the aforesaid circumstances, the Arbitrator appears to have acted within his jurisdiction in allowing some of the /75/ Com.O.S.No.5370/201 claims on account of escalation of costs which was referable to the execution of the work during the extended period.
12. AIR 1999 Mad 317 (256-264)[Head note B & Para7(b)] Contractor keeping labour idle due to non-providing of work by partly entrusting work-contractor can claim idle charges.
13.1997 (1) SCC 738 (265-274) In Government contracts, courts must keep in mind cost escalation of the project as a result of delay caused by its interference.
14.1989 SUPP 1 SCC 368 (para 12) (275-280) Escalation is a normal incident arising out gap of time in inflationary age escalation the rate of 20% awarded 15.1984 (2) SCC 860 (281-319) /76/ Com.O.S.No.5370/201 AIR 1984 SC 1072 (para 44) Escalation awarded though no provision for escalation.
16. 2007 (13) SCC 43 (para 32) (320-329) Escalation awarded was upheld even in the teeth in clause for escalation escalation is a normal incident arising out of gap of time in this inflationary age.
17.2002 (4) SCC 45 (para 15) (330-342) Escalation Sec. 55 of the Contract Act Even if the contractor undertakes not to make claim for delay in performance, there would be entitled for compensation if (i) contractor repudiates the contract under Sec. 55 of Contract Act; (ii) principal gives extension by agreement make it clear he would give escalation; (iii) contractor states that he is entitled to escalation and despite delay principal accepts performance and notice by the contractor.
18.2017 (8) SCC 146 (para 14, 19, 21) (343-358) Escalation is a normal incident of contract (para 14).
/77/ Com.O.S.No.5370/201 Award of idle charges upheld (para 19) Interest can be awarded for all three stages (para 21) IV. OVERHEADS
19. (2006) 11 SCC 181 (359-416)(Paras 102-115) 20.2006 (11) SCC 181 (359-416)(Para 83 and 104) Overhead charges Hudson's formula is not universally accepted (para 104). As per Sec. 55 of the Contract Act, if performance is delayed beyond agreed period, damages are payable (para 83).
21.2023 SCC Online SC 1208(417-447)(Para 14, 15,16) Hudson's formula, Emden's formula and Eichleay's formula was referred to in Mc.Dermatt International Inc case 2006 (11) SCC 181.
Damages should be commensurate with the loss sustained. In a claim for loss on account of delay in work attributable to the employer, contractor is entitled to loss sustained by the breach of contract to the extent and so far as money /78/ Com.O.S.No.5370/201 can compensate. The party should be placed in the same situation with the damages as if the contract done is performed.
The Principle is that the sum of money awarded to the party who has suffered the injury should be the same quantum as he would have earned or made if he had not sustained wrong for which he is getting compensation.
Various formulates regarding overheads has been discussed (para 22- 26) V. AWARD OF INTEREST AND FUTURE INTEREST
22. 2015 SCC OnLine Hyd 526-24% (448-463)(Para 20)
23. 2015 SCC OnLine HP 3375 24% (464-466)(Para 14) VI ADMISSIONS IN PLEADINGS ARE THE BEST EVIDENCE AND DO NOT NEED ANY FURTHER CORROBORATION
24.(2012) 8 SCC 516 (Para 12) (467-479) /79/ Com.O.S.No.5370/201
25.(2022) 1 SCC 115 (Para 15) (475-490)
26.(2010) 5 SCC 274 (491-511)(Para 44) It is needless to emphasise that admission of a party in the proceedings either in the pleadings or oral is the best evidence and the same does not need any further corroboration.
27.(1974) 1 SCC 242 (512-523)(Para 27) Admissions, if true and clear, are by far the best proof of the facts admitted. Admissions in pleadings or judicial admissions stand on a higher footing than evidentiary admissions. The former class of admissions are fully binding on the party that makes them and constitute a waiver of proof. They by themselves can be made the foundation of the rights of the parties.
VII. FACTS ADMITTED NEED NOT BE PROVED
28.(1981) 1 SCC 80 (524-550) /80/ Com.O.S.No.5370/201 (Head Note 'C' and Para 17) Admission furnishes the best evidence.
29.ILR 1982 KAR 446 (551-556)(Para 4)
30. 2006(12) SCC 552(557-559)(Head Note A and Para 9) Things admitted need not be proved. non cross-examination of Plaintiff's witness with respect to a particular fact would lead to the presumption that the witness account has been accepted.
VIII. NO CHALLENGE TO EXAMINATION IN CHIEF - STATEMENT MUST BE ACCEPTED AS TRUE
31.AIR 1961 CALCUTTA 359 (Para 10) (560-568) 32.1971(3) SCC 273 (Head Note and Para 8) (569-570) Non cross-examination on crucial aspects examination in chief must be accepted as true. Statements made in IX. ADVERSE INFERENCE MAY BE DRAWN IF THE BEST EVIDENCE IS WITHHELD /81/ Com.O.S.No.5370/201
33.AIR 1968 SC 1413 (Para 5) (571-576) Even if the burden of proof does not lie on a party the Court may draw an adverse inference if he withholds important documents in his possession which can throw light on the facts at issue. It is not, in our opinion, a sound practice for those desiring to rely upon a certain state of facts to withhold from the Court the best evidence which is in their possession which could throw light upon the issues in controversy and to rely upon the abstract doctrine of onus of proof.
X. NON CROSS-EXAMINATION WOULD RESULT IN THE WITNESS ACCOUNT BEING ACCEPTED
34. (2016) 12 SCC 288 (577-585) (Head Note and para 15) Non cross-examination of Plaintiff's witness with respect to a particular fact would presume that the witness account has been accepted.
XI. LIMITATION STARTS ONLY WHEN FINAL BILL IS ISSUED /82/ Com.O.S.No.5370/201
35. 2013 SCC Online Kar 9929 (Para 16) (586-622) It is by now well settled that the limitation starts from the date of the final bill and not from the date of the running bill.
36.MANU/DE/0747/1985 (623-626) (Para 8) 37.1961 SCC OnLine Cal 20 (627-632) (Para 14}
38.MANU/WB/0051/1963 (633-638) (Para 15) The limitation period of 3 years will not start running from the date of completion of the work or the non-payment of the running bills. The cause of action will arise only after the petitioner is intimated of the preparation of the final bill or his having accepted the payment.
39.(1988) 2 SCC 338 (639-642)(Para 4)
40. (2020) 14 SCC 643 (643-653)(Para 24) It is true that on completion of the work a right to get /83/ Com.O.S.No.5370/201 payment would normally arise but where the final bills as in this case have not been prepared as appears from the record and when the assertion of the claim was made on 28-2-1983 and there was non-payment, the cause of action arose from that date, that is to say, 28-2-1983. It is also true that a party cannot postpone the accrual of cause of action by writing reminders or sending reminders but where the bill had not been finally prepared, the claim made by a claimant is the accrual of the cause of action.
XII. SECTION 14 OF THE LIMITATION ACT WHEN ATTRACTED
41.(2016) 16 SCC 152 (654-658)(Para 8)
42.(1998) 8 SCC 357 (659) The two main ingredients required for attracting the principles under Section 14 of the Limitation Act, 1963 are that the party should be prosecuting another civil proceedings with due diligence and that the prosecution should be in good faith.
XIII SECTION 14 OF THE LIMITATION OUGHT TO BE /84/ Com.O.S.No.5370/201 APPLIED LIBERALLY
43. (2004) 3 SCC 458 (660-668)(Para 14) Section 14 of the Limitation Act is wide enough to cover such cases where the defects are not merely jurisdictional strictly so called but others more or less neighbours to such deficiencies. Any circumstance, legal or factual, which inhibits entertainment or consideration by the court of the dispute on the merits comes within the scope of the section and a liberal touch must inform the interpretation of the Limitation Act which deprives the remedy of one who has a right.
44. (2009) 1 SCC 786 (669-677)(Para 18) Section 14 should be construed liberally.
XIV. SECTION 14 OF THE LIMITATION APPLIES TO ALL PROCEEDINGS
45. (2015) 7 SCC 58 (678-721)(Para 35)
46. (2006) 6 SCC 239 (722-732)(Para 26) /85/ Com.O.S.No.5370/201 The word "court" in Section 14 takes its colour from the preceding words "civil proceedings". Civil proceedings are of many kinds and need not be confined to suits, appeals or applications which are made only in courts stricto sensu. This is made even more clear by the explicit language of Section 14 by which a civil proceeding can even be a revision which may be to a quasi-judicial tribunal under a particular statute. The ratio laid down in the above decisions aptly applicable to the case in hand including award of interest and future interest.
17. I am of the opinion that, in-spite of delays, which are not attributed to it resulted in the contract work being extended till 10.02.2000, wherein the virtual completion of the tunnel excavation and concreting was completed the defendants are liable to pay the claim Nos.1 to 18 and further I hold Under Section 55 and 73 of the said Act, the aggrieved party is entitled to claim damages, and there cannot be any restriction or prohibition exercised by the other party. It is the right of the aggrieved party to claim such damages.
/86/ Com.O.S.No.5370/201 Under section 23 of the Indian Contract Act, 1872, states that such clause is opposed to public policy since it aims at restraining the aggrieved party from claiming its rightful dues. Such kind of clauses are also not in public interest since they hinder the smooth operation of the commercial transactions as a result of which plaintiff is entitle flor the relief claimed in the plaint. Accordingly, I answer Issue Nos. 1 and 2 in the "AFFIRMATIVE".
18. ISSUE NO.3: In view of my answer on Issue Nos.1 & 2 and for the forgoing reasons, I proceed to pass the following;
ORDER Suit of the plaintiff is hereby decreed with costs.
Defendants 1 to 4 are hereby directed to pay Rs.5,50,17,600/- with interest at the rate of 24% from 10.07.1996 till 10.07.2016 i.e., Rs.26,40,84,480/- total Rs.31,91,02,080/- (Rupees thirty one crore ninety one lakhs two /87/ Com.O.S.No.5370/201 thousand and eighty only) to the plaintiff. Further, defendant shall pay future interest at the rate of 18% p.a. for the above suit claim amount from the date of suit till the date of realization.
Draw decree accordingly.
(Dictated to the Stenographer, typed by her, corrected and then pronounced by me in open Court on this the 16th day of October, 2024) (ROOPA K.N.), LXXXVII Addl.City Civil & Sessions Judge, (Exclusive Dedicated Commercial Court) Bengaluru.
ANNEXURE LIST OF WITNESSES EXAMINED ON BEHALF OF THE PLAINTIFF :
PW-1 Tam Tam Pedda Guruva Reddy.
LIST OF DOCUMENTS EXHIBITED ON BEHALF OF THE PLAINTIFF Ex.P1 Copy of Registered certificate.
Ex.P2 True copy of agreement.
Ex.P3 Bunch of invoices regarding purchase of
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machineries. Contains 7 invoices.
Ex.P4 True copy of letter addressed by Executive
engineer.
Ex.P5 Copy of letter addressed to the Executive
Engineer.
Ex.P6 Letter to the Exe.Engineer.
Ex.P7 Notarized copy of letter addressed to Secretary.
Ex.P8 Letter addressed to The Executive Engineer.
Ex.P9 Attested copy of letter addressed to Executive
Engineer by the Superintending Engineer. Ex.P10 Copy of letter addressed to Superintending Engineer.
Ex.P11 Copy of letter addressed to Superintending to Chief Engineer.
Ex.P12 Copy of letter addressed to Superintending Engineer signed by the Chief Engineer. Ex.P13 Copy of letter addressed to the Chief Engineer by plaintiff.
Ex.P14 and Notarized two letters addressed by witness to Ex.P15 the Chief Engineer.
Ex.P16 Letter addressed to Chief Engineer by the Superintending Engineer.
Ex.P17 Copy of the letter written by witness to The Secretary to Government of Karnataka. Ex.P18 Copy of letter written by CE to SE.
Ex.P19 to Copy of three letters addressed by the witness Ex.P21 to CE.
/89/ Com.O.S.No.5370/201 Ex.P22 Copy of letter written by CE to EE.
Ex.P23 to Five letters written by witness to CE. Ex.P27 Ex.P28 The served copy of letter written by EE.
Ex.P29 Letter from Chief Engineer to the plaintiff.
Ex.P30 Letter written to the plaintiff by AEE.
Ex.P31 Letter addressed to the EE by AEE.
Ex.P32 Letter to witness from Engineer -in-Chief.
Ex.P33 to Nine letters from the witness by Chief Ex.P41 Engineer, Executive Engineer and AEE (Ex.P40 is not marked) Ex.P42 Copy of the letter addressed to CE.
Ex.P43 Copy of the letter addressed to SE by the Executive Engineer.
Ex.P44 Copy of letter addressed by the witness to EE.
Ex.P45 Letter of Executive Engineer.
Ex.P46 Copy of letter addressed by the witness to EE.
/90/ Com.O.S.No.5370/201 Ex.P47 Copy of the letter addressed by the EE to AEE.
Ex.P48 The D.O letter written by EE to AEE.
Ex.P49 Letter written by the witness to Hon'ble Deputy Chief Minister.
Ex.P50 The letter addressed by the Chief Engineer to the Secretary.
Ex.P51 to Two copies of letters addressed by the Chief Ex.P52 Engineer by EE.
Ex.P53 Copy of the letter to the Secretary to the Chief Engineer.
Ex.P54 Copy of letter issued by EE to CE.
Ex.P55 to Eight copies of letters addressed to Secretary - Ex.P62 GOK, Chief Engineer, Exe. Engineer by the witness.
Ex.P63 Notarized copy of the claim statement.
Ex.P64 Copy of proceedings of review meeting held by the EE.
Ex.P65 Copy of claim statement made before EE.
Ex.P66 Copy of recommendation given by SE, CE, EE and AEE.
Ex.P67 Copy of letter addressed to The Secretary Irrigation Department by CE.
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Ex.P68 Copy of letter to SE by EE.
Ex.P69 Copy of letter addressed to Secretary Irrigation
Department by CE.
Ex.P70 Copy of the estimate prepared by the Irrigation
Department.
Ex.P71 to Four copy of letters addressed by the witness Ex.P74 to EE, CE.
Ex.P75 Letter addressed by the CE to witness.
Ex.P76 to 3 more letters addressed by the witness to CE Ex.P78 and Secretary.
Ex.P79 Notarized copy of the orders passed in CMP No. 54 to 57/2022.
Ex.P80 Notarized copy of orders passed in W.P.No. 5315/2003.
Ex.P81 Notarized copy of orders passed in Civil Appeal No. 1586/2004.
Ex.P82 Notarized copy of the notice issued u/sec. 80 of CPC.
Ex.P83 The reply to the notice issued by the Department.
Ex.P84 Notarized copy of running account bill issued by the department.
Ex.P84(a) Notarized copy of List of Description of items with quantity and amount.
Ex.P85 to Two letters issued by the witness to EE. Ex.P86 /92/ Com.O.S.No.5370/201 Ex.P87 Copy of letter written by Secretary Irrigation Department to the CE.
Ex.P88 Completion of the work certificate.
Ex.P89 The Board Resolution No. 1 dtd: 11.07.2016 authorising the son of the Plaintiff. Ex.P90 Extract of Board Resolution No.2 dtd:
11.07.2016 authorising plaintiff.
LIST OF WITNESSES EXAMINED ON BEHALF OF THE DEFENDANTS DW1 Manjesh Gowda - Withdrawn as per court order dtd:07.08.2021 DW2 Jayaramaiah LIST OF DOCUMENTS EXHIBITED ON BEHALF OF THE DEFENDANTS Ex.D1 The original tender document Ex.D2 Copy of the proceedings of State Government.
The letter to the Chief Engineer Hemavathi Ex.D3 Cannel Range, Tumkur.
Letter from The Secretary Irrigation Ex.D4 Department to the Chief Engineer.
Ex.D5 Copy of proceedings of Chief Engineer.
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Letter from the Chief Engineer to The
Ex.D6
Superintending Engineer Turuvekere.
Another letter from the Chief Engineer to the Ex.D7 Superintending Engineer.
Ex.D8 to 4 copies of letters to the plaintiff by Chief Ex.D11 Engineer, Hemavathy Canal Zone, Tumkur.
The letter from the Exe. Engineer to the Ex.D12 witness.
The letter written by Exe. Engineer to the Ex.D13 Superintending Engineer dated 12.12.1997.
Copy of the letter from the Superintending Ex.D14 Engineer to the Chief Engineer dated 22.02.2000.
Office copy of the letter addressed to Ex.D15 Superintending Engineer dated 07.04.1998 Office copy of the letter addressed to Secretary Ex.D16 Irrigation Department dated 04.08.1998 Office copy of the letter addressed to Ex.D17 Superintending Engineer dated 09.08.1999.
Office copy of the letter to SE dated
Ex.D18
25.01.2000.
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Office copy of the letter issued to SE dated Ex.D19 29.01.2000.
Ex.D20 Office copy of the letter dated 01.08.1996.
Ex.D21 Office copy of the letter dated 21.08.1996 Ex.D22 Office copy of the letter dated 27.09.1996 Ex.D23 Office copy of the letter dated 11.09.1996 Ex.D24 Office copy of the letter dated 20.12.1997 Ex.D25 Office copy of the letter dated 15.12.1997 Ex.D26 Office copy of the letter dated 27.01.1997 Ex.D27 Office copy of the letter dated 20.01.1997 Ex.D28 Office copy of the letter dated 16.01.1997 Ex.D29 Office copy of the letter dated 18.10.1998 Ex.D30 Office copy of the letter dated 17.10.1996 Ex.D31 Office copy of the letter dated 26.07.1996 Ex.D32 Office copy of the letter dated 24.07.1995 Ex.D33 Office copy of the letter dated 21.07.1995 Ex.D34 Office copy of the letter dated 15.06.1995 Ex.D35 Office copy of the letter dated 10.10.1996 Ex.D36 Office copy of the letter dated 26.08.2000 /95/ Com.O.S.No.5370/201 Ex.D37 Office copy of the letter dated 21.08.1996 Ex.D38 Office copy of the letter dated 12.07.1996 Ex.D39 Office copy of the letter dated 09.05.1996 Ex.D40 Office copy of the letter dated 16.01.1997 Ex.D41 Office copy of the letter dated 06.01.1996 Ex.D42 Office copy of the letter dated 23.04.1998 Ex.D43 Office copy of the letter dated 21.03.1998 Ex.D44 Office copy of the letter dated 06.01.1996 Ex.D45 Office copy of the letter dated 10.01.1996 Ex.D46 Office copy of the letter dated 10.01.1996 Ex.D47 Office copy of the letter dated 10.01.1996 Ex.D48 Office copy of the letter dated 10.01.1996 Ex.D49 Office copy of the letter dated 09.01.1996 Ex.D50 Office copy of the letter dated 10.01.1996 Ex.D51 Office copy of the letter dated 09.01.1996 Ex.D52 Office copy of the letter dated 09.01.1996 Ex.D53 Office copy of the letter dated 09.01.1996 Ex.D54 Office copy of the letter dated 02.03.1996 Ex.D55 Office copy of the letter dated 19.04.1996 /96/ Com.O.S.No.5370/201 Ex.D56 Office copy of the letter dated 19.04.1996 Ex.D57 Office copy of the letter dated 05.06.1996 Ex.D58 Office copy of the letter dated 19.08.1996 Ex.D59 Office copy of the letter dated 31.08.1996 Ex.D60 Office copy of the letter dated 10.04.1996 Ex.D61 Office copy of the letter dated 24.02.1997 Ex.D62 Office copy of the letter dated 21.07.1997 Ex.D63 Office copy of the letter dated 19.04.1996 Ex.D64 Office copy of the letter dated 25.09.1997 Ex.D65 Office copy of the letter dated 27.05.1997 Ex.D66 Office copy of the letter dated 21.05.2000 Ex.D67 Office copy of the letter dated 31.08.1996 Ex.D68 Office copy of the letter dated 11.09.1996 Ex.D69 Office copy of the letter dated 23.02.1996 Ex.D70 Office copy of the letter dated 11.09.1996 Ex.D71 Office copy of the letter dated 02.01.1997 Ex.D72 Photo copy of the letter dated 02.05.1995 Ex.D73 to Similarly, the photo copies of letters dated Ex.D82 26.03.1998, 20.03.1998, 26.02.1998, /97/ Com.O.S.No.5370/201 05.01.1998, 05.02.1998, 07.12.1997, 06.12.1997, 17.05.1997, 22.06.1998, 01.07.1998.
LXXXVII Addl.City Civil & Sessions Judge, (Exclusive Dedicated Commercial Court) Bengaluru.