Delhi District Court
M/S Ptpc Express (P) Ltd vs The Chief Secy on 5 February, 2009
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IN THE COURT OF SHRI RAKESH TEWARI:
ADDL. DISTRICT JUDGE: DELHI.
Suit No.1103/08 (old no.214/07)
M/S PTPC EXPRESS (P) LTD.
B-5, JYOTI BUILDING,
66, NEHRU PLACE, NEW DELHI
THROUGH GPA SUKHBIR SINGH BAHL
S/O SH.AWTAR SINGH ....PLAINTIFF
VERSUS
1. THE CHIEF SECY, GOVT OF NCT, NEW DELHI.
2. THE COMMISSIONER SALES TAX,
BIKRI KAR BHAWAN, I.P. ESTATE,
NEW DELHI.
....DEFENDANTS
DATE OF INSTITUTION: 26.07.2004
DATE WHEN THE CASE RESERVED FOR ORDER: 20.01.2009
DATE OF JUDGMENT: 5.2.2009
SUIT NO.1104/08(old no. 344/06)
Govt. of NCT of Delhi
Through Commissioner of Value Added Tax
(formerly known as Commissioner of Sales Tax),
Deptt. of Trade & Taxes, Bikri Kar Bhawan,
New Delhi-110002.
......PLAINTIFF
VERSUS
PTPC Express Pvt. Ltd.
through Sh.Sanjay Kapoor Director
B-4/8, Jyoti Building,
66, Nehru Place,
New Delhi-110019.
.....DEFENDANT
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DATE OF INSTITUTION: 28.08.2006
DATE WHEN THE CASE RESERVED FOR ORDER: 20.01.2009
DATE OF JUDGMENT: 5.2.2009
JUDGMENT
1. By this common judgment I shall dispose of two suits bearing no.1103/2008 filed by M/s PTPC Express (P) Ltd. which is a courier company against the Commissioner Sales Tax, Government of NCT of Delhi and suit no.1104/08 has been filed by the Government of NCT of Delhi against the said courier company as the subject matter of the suit, i.e., the tender, the contract involved in the case are common in both the suits and my learned predecessor vide his order dated 17.1.2008 clubbed the said two suits for the purpose of trial and issues framed in both suits were to be taken together and evidence was recorded in suit no.1103/2008 which was declared as the leading case and for the sake of convenience and in order to avoid any confusion by using the expressions "plaintiff" and "defendant", I shall be using the expressions "the courier company" and "the government".
Facts in Suit No.1103/2008
2. The facts narrated in suit no.1103/08 are that the 3/41 courier company was successful bidder in the tender dated 24.02.03 issued by the office of Commissioner Sales Tax for providing the courier service to the said department and being the lowest bidder work was allowed to the said courier company on 18.08.03 and an amount of Rs.50,000/- was deposited as security with the government and although the tender was awarded in March 2003 but the work was allowed to be started on 18.08.03 and the courier company also suffered interest on the said amount of Rs.50,000/- for about six months @ 24% per annum which the courier company had borrowed in order to able to bid for tender. It is further averred that from 18.8.2003 to 02.09.2003 the courier company delivered about 25,967 letters in span of only 14 days and that from the very beginning the said department started demanding gratification to which the courier company was not obliged as the rates were so low that nothing could be sliced out and the courier company had to turn down all such illegal demands of the department which irritated the department and ultimately the said office of Commissioner of Sales Tax terminated the contract of the courier company on 22.9.2003 on flimsy grounds which had no legs to stand and 4/41 that from the very beginning the department started creating troubles and violating the terms and conditions of tender and gun was being tried to put on shoulders of the courier company. It is further averred in the plaint that it was a vital term of the contract to deliver a letter containing 3 to 4 pages but the department asked to deliver 7 pages to which the courier company raised objection and it was asked verbally to start work and payment would be made @ Rs.7/- per letter for seven pages and accordingly the courier company delivered 25967 letters in 14 days from 18.8.03 to 2.9.03 for which the courier company had to create extra ordinary management by incurring extra ordinary expenditure regarding which the department was duly informed. It is further averred in the plaint that the tender was inherently defective favouring the government which was unlawful and void abinitio due to the reasons that it did not disclose as to how many letters were to be delivered in what period and that the letters were open supplied for delivery whereas it was the precondition of tender that envelope would be provided and to save the expenditure of envelopes the courier company was asked to deliver letters to 5/41 dealers of the government in open condition and that it was not mentioned in tender that as to how many letters were to be delivered on the daily basis and that the delivery staff had to face a great difficulty to deliver open letters because on presentation the addressee started reading letter of seven pages which consumed time of the courier company and reduced its efficiency and after reading letters addressee used to put off the delivery staff with lame excuses which was duly communicated to the department of the government and instead of solving the problem the department created situation which may force the courier company to leave the tender and the department in violation of the terms and conditions of the tender started putting extra conditions by way of four to five staff members were being asked to be deputed by the courier company to work for the department and that the bill for letters containing seven pages without envelope so delivered by the courier company from 18.8.03 to 2.9.03 was raised to the tune of Rs.1,96,311/- vide bill no.2150 on 1.10.2003 but the department has not paid the said bill and as such the courier company is entitled to interest thereon @ 24% p.a. and that the department was supposed to 6/41 refund the security deposited by the courier company to the tune of Rs.50,000/- suo moto which has also not been refunded to the courier company by the department after terminating the contract which showed malafide intention of the department and as such the department is liable to pay an interest @ 24% p.a. on the said amount also and the breakup of amount claimed by the courier company from the department is that Rs.1,96,311/- is the amount of bill raised, Rs.31,409/- is the amount of interest @ 24% p.a. from September 2003 to April 2004, Rs.50,000/- is the amount of security, Rs.8,000/- is the interest on the said amount of Rs.50,000/- from September 2003 to April 2004 and Rs.25,000/- is the amount spent solely for management to deliver letters and thus, the total being Rs.3,10,720/-. After given up the remaining amount, it has been prayed that a decree of Rs.3 Lacs may be passed in favour of the courier company along with interest for pendentelite and future period @ 24% p.a. and costs of the suit.
3. The government as well as the office of sales tax commissioner filed their written statement taking the preliminary objections to the effect that the suit has not been 7/41 filed by a competent person as the resolution of the board of directors of courier company is defective and that the rate of delivery of letters was agreed @ Rs.2.80 per letter whereas the courier company was claiming Rs.7/- per letter and the interest as claimed by the courier company @ 24% p.a. which was not according to the terms of the agreement and on merits the fact that the courier company was successful bidder vide tender dated 24.02.2003 was not denied and Rs.50,000/- were deposited as security was also not denied but it has been alleged in the written statement that the tender was for Traders Identification Number (TIN) allotted by the department of sales tax to the dealers registered with it and that no loss has been suffered by the courier company as alleged in the plaint and that it is the government department which suffered loss due to inability of the courier company to deliver the letters as agreed and the government had to award the contract for providing courier service to the next lowest bidder for which the separate suit no.1104/08 has been filed. The alleged demand of illegal gratification has also been denied and it has been averred that the department had been trying to accommodate the courier company and 8/41 giving it more relief so that the letters could be delivered as quickly as possible and that letter of 7 pages instead of 3-4 pages were directed to be delivered by the courier company has also been denied and that on the contrary the department had given various concessions to the courier company by foregoing the process of delivering the letters in the envelope and agreed to the delivery of folded letters without any envelope and that no assurance was given to the courier company to pay the amount of Rs.7/- per letter. Further delivery of 25,967 letters during the period from 18.8.03 to 02.09.03 has not been denied. It has been further mentioned in the written statement that if the tender was void abinitio as per the contention of the courier company the present suit filed by it by virtue of the said tender is not maintainable and the allegations of the courier company about violations of terms of the tender by the department are only afterthought. The difficulty faced by the staff of the courier company has also been denied and on the contrary it has been alleged that the staff of the department duly helped and assisted the staff of the courier company but the courier company never abide by the time schedule for delivery of letters by coming very 9/41 late in the evening to collect the letters and taking more time in delivering the letter which resulted in inordinate delay in delivery of letter in spite of various concessions being given by the department to the courier company which is evident from the various meetings held by the department with the representative of the courier company. It is further alleged in the written statement by the government and the department that the bill to the tune of Rs.1,96,311/- was raised on 1.10.2003 by the courier company but the same was not paid because the amount in the bill has been calculated @ Rs.7/- per letter against the agreed amount of Rs.2.80/- per letter and the department deliberately not paid the amount as the courier company failed to perform its part of the contract by not delivering the letters as per schedule and number of letters to be delivered putting the department at financial loss because of which the department had awarded the work to the other lowest bidder. It has been further averred that the security amount of Rs.50,000/- has not been forfieted by the department which has adjusted the amount against the loss suffered by the department and has filed a separate suit claiming the damages against the courier 10/41 company of the remaining amount.
4. The courier company in its replication has denied the preliminary objections and reiterated the contents of the plaint.
Facts in Suit No.1104/2008
5. The facts narrated by the government are that in suit no.1104/2008 the Sales Tax department is the part of the Government of Delhi with the task of levying and collecting sales tax and that with a view to make ground preparation for introduction of Value Added Tax, it was decided to allot Traders Identification Number (for short TIN) to all the dealers registered with the said department and that the time was essence of the contract and accordingly a tender was issued and bids were invited for delivery of TIN application forms to approximately 1,60,000 registered dealers of the department and the bids for the tender were opened on 3.3.2003 and the said courier company was lowest bidder who agreed to provide the courier service and to deliver the letters approximately 1,60,000 to the registered dealers of the Sales Tax department against a charge of Rs.2.80 per letter and that a letter of intent dated 6.6.2003 11/41 was issued to the courier company who sent its acceptance vide letter dated 7.6.2003 and the courier company was finally awarded contract for providing courier service vide letter dated 13.8.2003 and was asked to commence the work w.e.f. 18.8.2003 with the direction to contact Mr.Sanjeev Ahuja, Assistant Commissioner-IX of Sales Tax for further directions and to submit names and addresses of the personnel likely to be deployed to execute the work and the courier company started the work w.e.f. 18.8.2003.
6. It has been further averred that earlier a complaint dated 22.8.2003 had also been received by the System Analyst from Mr.Sanjeev Ahuja, Assistant Commissioner-IX regarding non performance of the courier company and the said communication has been reproduced in para 7 of the plaint and that thereafter a meeting was held in the office of Additional Commissioner of Sales Tax on 25.8.2003 to sort out the problem being faced by the courier company in distributing the letters of application of TIN in which the representative of the courier company was also present who refused to sign the minutes of meeting but verbally assured the department that it would improve the services and 12/41 thereafter minutes of meeting have been reproduced in para 8 of the plaint. It has been further averred in the plaint that the complaints were received from various officers of the department with respect of deficiency in services of the courier company regarding non performance of the services and one such complaint dated 2.9.2003 by Mr.Sanjeev Ahuja , Assistant Commissioner-IX to the system analyst Mr.A.K.Bist has been reproduced in para 9 of the plaint and that a letter dated 4.9.2003 was issued by the department to the courier company again bringing out the deficiency in the work and service being provided by the courier company but of no avail. It has been further averred that in view of the persistent complaints received from various officers and failure of the courier company to rectify the deficiencies in services, the department had no alternative but to terminate the contract which was ultimately terminated the contract vide communication dated 22.9.2003 which has been reproduced in para 11 of the plaint. It has been further averred in the plaint that thereafter the contract was awarded to the next lowest bidder and it was informed to the said courier company that it has been done at its risk and 13/41 costs and the courier company was further directed to handover all the undelivered letters and the receipt of the delivered letters, serially numbered, to the concerned Zonal Asstt. Commissioners within 3 days, failing which the courier company was informed that the department would proceed further with suitable civil and criminal action against it but the courier company failed to furnish the details of acknowledgment of 25,967 letters stated to have been served by the courier company and that the contract was awarded to the next bidder M/s Skylark Express at a charge of Rs.3.65 per letter who started providing services w.e.f. 24.09.2003 against the rate of Rs.2.80 offered by the courier company and that earnest money of Rs.50,000/- deposited by the defendant was approved to be forfeited by the finance department, Govt. of NCT of Delhi and that the remaining 1,34,033 letters were returned by the courier company as undelivered due to which the government suffered a loss of Rs.3,84,892.40 and the courier company is liable to pay the said amount from which the security amount of Rs.50,000/- was deducted and the balance recoverable amount from the courier company came to Rs.3,34,892.50 on which interest 14/41 has been calculated as Rs.1,90,215/- @ 21% p.a. and the cost of the notice fee was Rs.5500/- and thus, the courier company is liable to pay a sum of Rs.5,30,670.50 due to the loss suffered by the government.
7. The courier company in its written statement has taken the preliminary objections that the suit has not been verified properly nor filed by a juristic person nor filed by a authorized person and as such the same is liable to be dismissed and that the suit has been overvalued and as such this court has no jurisdiction to try the suit and that the suit deserves to be stayed under Section 10 CPC and on merits it was denied that tender was for delivery of application form for TIN rather it was only for letters as stated in the tender itself and the department is trying to improve upon its own documents and that the courier company did not accept the illegal terms of the department which was asking commission from the courier company and staff of the department started creating trap and excuses for cancellation of tender and the letter mentioned in the plaint has been falsely created in order to get rid of the courier company and that the courier company had complained to the department that since 15/41 number of pages has been increased the amount of charges for such pages would be to the extent of Rs.7/- which was agreed by the defendant and only then work was started by the courier company and later on the department was not sticking to such agreed terms and the problems faced by the courier company were communicated to the department and alleged complaints against the courier company have been falsely created and this suit has been filed as a counter blast to the suit of the courier company filed earlier and instead of filing a counter claim in the suit filed by the courier company the government has filed the present suit which is not maintainable and nothing can be claimed by the department nor the amount of Rs.50,000/- as security deposited could be forfeited by the department.
8. On the basis of the pleadings of the parties in suit no.1103/2008 the following issues were framed:-
i. Whether Plaintiff is entitled to the decree of Rs.3 lacs as prayed? (OPP) ii. Whether Plaintiff is entitled to rate of Rs.7/- per letter delivered against the agreed rate of Rs.2.80 per letter delivered?
(OPP) 16/41 iii. Whether Plaintiff has not performed his part of the contract as alleged in para 13 of the written statement? (OPD) iv. Relief.
9. On the basis of the pleadings of the parties in suit no.1104/2008 the following issues were framed:-
i. Whether there was a deficiency in service of PTPC Express Pvt. Ltd.? (OPP) ii. Whether the plaintiff is entitled for any amount from the defendant, if so what amount?
iii. Whether the plaintiff is entitled for any interest, if so, on what amount, at what rate and from which period?
iv. Whether the suit is not filed by a proper and authorized person?
10. In order to prove the suit no.1103/08 and its defence in suit no.1104/08, the courier company produced its director as PW1 who filed his examination-in-chief by way of affidavit Ex.P1 and he proved the letter dated 6.6.2003 issued by he department as Ex.PW1/1, the letter of acceptance by the courier company as Ex.PW1/2, the tender document and the letter dated 12.8.03 containing the terms of the accepted 17/41 tender as Ex.PW1/3 and Ex.PW1/4, the letter dated 13.8.2003 of the department as Ex.PW1/31, the minutes of meeting between the courier company and the department as Ex.PW1/5, the letter dated 4.9.2003 whereby the work of the courier company was withdrawn as Ex.PW1/30, the bill raised for the delivery of 25,967 letters as Ex.PW1/27, the consolidated receipt of proof of delivery as Ex.PW1/28, report of returned letters as Ex.PW1/29, the letter dated 8.9.2003 as Ex.PW1/6, the department letter dated 22.9.2003 as Ex.PW1/7, the letter dated 25.9.2003 as Ex.PW1/8, the letter dated 13.10.2003 as Ex.PW1/9, the department letter dated 6.10.2003 as Ex.PW1/10, the courier company letter dated 13.10.2003 as Ex.PW1/11, the department letter dated 30.09.2003 as Ex.PW1/12, the courier company letter dated 3.10.2003 as Ex.PW1/13, the courier company letter dated 20.10.2003 as Ex.PW1/14, its UPC as Ex.PW1/15, other letters dated 23.10.03, 29.10.2003 and 5.11.2003 as Ex.PW1/16 to Ex.PW1/18 respectfully, the legal notice dated 14.1.2004 of the courier company given to the department as Ex.PW1/19, its speed post receipts as Ex.PW1/20 and Ex.PW1/21, the reply of the said notice by the department 18/41 dated 11.3.04/25.03.04 as Ex.PW1/22, the letter inquiring the delivery of the notices as Ex.PW1/23, certificate of service given by the postal department as Ex.PW1/24, the resolution of the board of directors of the courier company as Ex.PW1/25 and copy of the attorney executed in favour of the attorney as Ex.PW1/27 and thereafter he was cross-examined.
11. On the other hand, in order to prove its case in suit no.1104/08 and defence in suit no.1103/08 the government and the department produced its official as DW1 who filed his examination-in-chief by way of affidavit Ex.DW1/1 and he exhibited his authority letter as Ex.DW1/A, the invoice/bill no.879 dated 21.10.2004 of the second lowest bidder M/s Skylark Express as Ex.DW1/B and the sanction of the payment to the said second lowest bidder as Ex.DW1/C and thereafter he was cross-examined.
12. I have heard the counsels for the parties and perused the record and also gone through the written arguments placed on record on behalf of the courier company.
13. Issue no.1 in suit no.1103/08 is to be taken up for consideration with issues no.2 and 3 in suit no.1104/08 as the same relates to entitlement to recover the amount from 19/41 against each other by both the parties.
14. Issue no.3 in suit no.1103/08 has been taken up for consideration with issue no.1 in suit no.1104/08 as the same relates to non performance of the contract and deficiency in service of the courier company.
15. Issues no.2 and 4 in suit no.1103/08 and issue no.4 in suit no.1104/08 are to be decided independently because the same relates to the entitlement of the courier company to claim the amount @ Rs.7/- per letter and the relief and as to whether the suit no.1104/08 is not filed by an authorized and proper person.
16. Let me decide the issue no.2 in suit no.1104/2008 first which is as under:-
"Whether the suit no.1104/2008 is not filed by a proper and authorized person?"
17. The DW1 the official of the department in his affidavit of examination-in-chief Ex.DW1/1 had deposed that he was working as Manager (EDP) (earlier known as System Analyst), Department of Trade & Taxes, Govt. of NCT of Delhi and was duly authorized by the Commissioner of Value Added Tax (formerly known as Commissioner Sales Tax) and 20/41 competent to swear the present affidavit vide letter Ex.DW1/A.
18. In his cross-examination he replied that he was appearing in the court as a witness as the government has authorized to depose in this case vide authority letter Ex.DW1/A. He admitted that no name is mentioned in the authorization letter but the authority is given by designation and that on the date of execution of authorization he was only System analyst in the department. The authority letter dated 25.11.2004 has given the authority by designation. The courier company failed to assail the designation of the DW1 at the time of filing of the suit and as such, there is nothing on the record that the DW1 was not authorized official of the state government to represent the case of the government. Accordingly, issue no.4 in suit no.1104/08 is decided in favour of the government and against the courier company.
19. Issue no.2 in suit no.1103/2008 "Whether Plaintiff is entitled to rate of Rs.7/- per letter delivered against the agreed rate of Rs.2.80 per letter delivered? (OPP)"
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20. Admittedly in para 6 of the plaint and para 7 of the examination-in-chief of the affidavit Ex.P1, the assurance of Rs.7/- per letter was verbal and in his cross-examination PW1 has replied that Sh.K.S.Bisht assured him to get the rate of Rs.7/- per letter and after he informed Sh.K.S.Bisht that the number of pages were more than that which were specified in the tender and that Sh.K.S.Bisht assured him to increase the rate and it was only on 19th and 20th August 2003 when Sh.K.S.Bisht gave the assurance after he received the first dispatch of letters on 18.8.03 and that it was all verbal and that neither he gave in writing nor Sh.Bisht assured him in writing. He further replied that he had continued with the assurance orally otherwise he would not have continued with the work.
1. On the other hand, Sh.K.S.Bisht who has appeared as DW1 had denied the suggestion that the department had agreed to pay @ Rs.7/- per letter delivered or the courier company was entitled to claim the delivery chages @ Rs.7 per letter. As the said alleged increased rate to Rs.7/- as per own case of the courier company was verbal and no written agreement to that effect was executed between the parties 22/41 nor any sanction to increase the said rate of charges was made by the government, the issue no.2 in suit no.1103/08 is decided against the plaintiff (the courier company) and in favour of the government.
2. Issue no.3 in suit 1103/08
"Whether Plaintiff has not performed his part of the contract as alleged in para 13 of the written statement? (OPD)"
Issue no.1 in suit no.1104/08 "Whether there was a deficiency in service of PTPC Express Pvt. Ltd.?
(OPP)"
These two issues are taken together as these are overlapping each other.
23. The PW1 in his his examination-in-chief has deposed the facts as mentioned in the plaint above and he has proved the said documents. In his cross-examination the PW1 has replied that letter Ex.PW1/1 mentions the rate of deliveryof letters as Rs.2.80 as filled by him in the tender. He admitted that one letter Ex.PW1/21 had responded the letter Ex.PW1/1 23/41 and accepted the rates. He further admitted that as per the terms of the tender the courier company was to deliver the letters within three days from the receipt of the same from the department but the courier company was not specified about the number of the letters and that on the first day the courier company received only 100 letters. He admitted that meeting was held on 25.8.03 for which he was called and he attended the said meeting but did not sign the minutes of meeting Ex.PW1/5 and he refused to sign the minutes because the department was forcing him to accept the terms which were practically not possible and never part of the tender. He further admitted that covenant no.4 of the tender stipulates the delivery of the letters within 3 days from the date of receipt from the department and the department asked the remaining questions with regard to the authority of the PW1 and the general power of attorney executed in his favour Ex.PW1/26. He further denied the suggestion that no amount was payable to the courier company as claimed in the suit or that the courier company failed to perform its duty and committed breach of contract.
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24. From the said cross-examination it is clear that no question was put to the witness PW1 with regard to the delayed allotment of work despite the acceptance of the tender by him on 7.6.2003 as mentioned in para 3 of the affidavit of examination-in-chief Ex.P1. No question was put regarding the allegation of the PW1 that envelope handed over for the delivery of letters were too small and could not fit 7 pages as mentioned in para 6 of the affidavit Ex.P1. Further no question was asked with regard to the alleged first time information to the PW1 with regard to the delivery of TIN numbers later on not regular letters vide meeting dated 21.8.2003 and delivery of 1.6 lacs letters within a span of 10-15 days as mentioned in para 9 of the affidavit Ex.P1 and the allegations mentioned in paras 10 and 11 of the affidavit Ex.P1 that in the meeting dated 22.8.2003 with the department the new conditions were imposed upon the courier company and the ground was being made making the work impossible and to execute and other officials tried to force the PW1 to sign the minutes of the meeting which were totally contrary to the terms of the contract and deponent refused to sign the same. The deposition in para 12 of the 25/41 affidavit Ex.P1 of PW1 that due to the letters being given without envelope, every addressee started reading the contents before refusing to accept it or taking it which increased drastically the time taken for the delivery and that a letter which normally would be delivered 2-3 minutes in an envelope started taking at least 10-12 minutes on that account, remained unassailed in the in the cross-examination on behalf of the department and deposition in para 14 of the affidavit Ex.P1 that the courier company had made arrangement for collection of letters everyday morning but the officials of the department never had the letters ready and staff of the courier company had to wait the whole day, sometime upto 4 PM to collect the letters, remained unquestioned in the cross-examination or not even a suggestion was thrown against the said deposition. Further the deposition in para 16 of the affidavit Ex.P1 that the courier company had not been given any time to set up the proper infrastructure for the delivery of letters in such a huge volume and in such a short time, but still the courier company made arrangement on war footing and was streamlining the process when it was again shocked to 26/41 receive the letter dated 4.9.2003 Ex.PW1/30 withdrawing the work from the courier company just 12 days from the date of starting of delivery, i.e., after the meeting of 21.9.2003 also remained unrebutted in the cross-examination on behalf of the department.
25. Let me examine what DW1 has to say with regard to the said two issues. DW1, the official of the department filed his examination-in-chief by way of affidavit Ex.DW1/1 and has deposed that the department of Value Added Tax (formerly known as department of Sales Tax) with a view to make ground preparation for introduction of Value Added Tax in the N.C.T. of Delhi and it was decided to allot Traders Identification Numbers to all the dealers registered with the sales tax department and time was the essence of the contract and the tender was issued inviting bids for delivery of TIN application forms approximately 1,60,000 to the dealers registered with the department and the courier company being the lowest bidder was given the contract @ Rs.2.80 per letter and acceptance of the contract by the courier company was made by its letter dated 7.6.2003 and that the complaints were received by the department from its 27/41 various officers with respect to deficiency in service by the courier company in delivering the letters to the registered dealers with the department, in spite of various meetings held by the officials of the department with the representative of the courier company pointed out the deficiencies and delays in delivering the letters to the dealers in a time bound programme, but there was no improvement in service provided by the courier company despite the concessions granted by the department to the courier company by instructing the staff to cooperate the courier company. Due to inability of the courier company to deliver the letters, the department had no option but to terminate the contract of the courier company vide communication dated 22.9.2003. It has been further deposed that termination of the contract of the courier company for the delivery of the remaining 1,36,438 letters was awarded to M/s Skylark Express @ Rs.3.65 per letter being the second lowest bidder after the courier company and the invoice/bill no.879 dated 21.10.2004 of M/s Skylark Express claiming an amount of Rs.3,84,892.50 towards the delivery of 1,05,450 letters is Ex.DW1/B and sanction of the said payment is Ex.DW1/C. 28/41
26. In his cross-examination he has denied the suggestion that prior to the floating of the tender there was no communication of the department that the tender was with respect to the delivery of the TIN numbers but when he was specifically asked to show the communication then he admitted that there was no such communication and that the tender was the only communication. He further admitted that the tender document Ex.PW1/3 also nowhere stated that the appointment of courier service was for delivery of TIN numbers and it has been observed by the court after going through the complete tender document, the witness admitted as correct that till the date of the acceptance of the tender, there was no communication from the department with respect to how many letters per day were expected to be delivered. He further admitted that there is no letter which says that the letters have to be collected from various wards. He further admitted that after the acceptance of the tender the first communication sent by the department was on 12.8.2003 which is Ex.PW1/4. He further admitted that in Ex.PW1/4 also, no schedule with respect to the number of the letters delivered per day is mentioned.
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27. DW1 has further replied that he was working in the department since 10th January, 2002. He admitted that the kind of exercise of delivering letters to all the registered dealers on time bound basis has not been undertaken by his computer branch. He further admitted that work of delivery of letters started on 18.8.03 but the courier company had deployed only one person to deliver 1.6 lacs letters to the dealers. He could not tell if any meeting was called or any communication was sent to the courier company between 12th August and 18th August, 2003. He further replied that delivering the letters without envelopes were changed at the request of the courier company but there was no letter of request to that effect given to the department by the courier company. He further admitted that the same was decided in the meeting held under the Chairmanship of Commissioner-I but he could not tell the date of the meeting. Further he identified the minutes of the meeting as Ex.PW1/5. He admitted that the department has not filed any document to show the appointment of M/s Skylark Express was in furtherance of the same tender under which the courier company was appointed. He could not tell orally the name of 30/41 the dealers who did not receive the letters.
28. In order to appreciate the rival evidence of the parties as reproduced above it is necessary to go through the document of the tender Ex.PW1/3. In the first page it is mentioned that sealed quotations from reputed courier agencies having relevant experience of at least 5 years were invited form providing courier services for delivery of letters in person to about 1.60 lacs registered Sales Tax dealers scattered all over Delhi on time bound basis. In the terms and conditions for providing courier services for delivery of letters to registered sales tax dealers it is mentioned in item no.1 that rates should be quoted on per unit basis, in item no.2 it is mentioned that full addresses and envelopes should be provided by individual ward officers to the courier service provider for onward delivery and the courier service should be required to address the envelopes and deliver it to the dealers, in item no.3 it is mentioned that letter to be delivered should be contained 4-5 pages (both sides printed), in item no.4 it is mentioned that the service provider shall deliver the letters to the addressee in person within 3 days of the receipt from the department, in item no.5 it is mentioned 31/41 that the service provider shall submit complete record of the letters delivered along with acknowledgments to the department, in item no.6 it is mentioned that the name, address and phone number of the recipient should clearly be visible on the acknowledgment receipt provided by the service provider, in item no.7 it is mentioned that a penalty equal to the unit price quoted by the service provider shall be deducted for each unit of delivery for any delay of services beyond the prescribed time limit, in item no.8 it is mentioned that the service provider shall ensure to deliver the letters to the addressee in third attempt in case first or/and second attempt fails, in item no.9 it is mentioned that payment for undelivered letters shall not be made by the department whether it is because of wrong address or non-availability of the addressee, in item no.10 it is mentioned that the service provider shall be handing over the undelivered envelopes to respective wards, in item no.11 it is mentioned that conditions imposed by the department shall be binding on the service provider whereas the conditions imposed by the service provider will not be binding and acceptable to the department, in item no.12 it is mentioned that the service 32/41 provider shall depute sufficient number of manpower in each ward of the department to receive and deliver the letters within the time schedule prescribed by the department.
29. Let me go through the minutes of meeting Ex.PW1/5 which was not signed on behalf of the courier company but it has been alleged by the department that the meeting has taken place when the representative of the courier company was present. It is mentioned at item no.2 that certain decisions were taken which were agreed to by Sh.Sanjay Kapoor, the Director of the courier company and decisions were to the effect that the courier company shall deliver serially numbered receipt to the department as per the serial number of the letter issued to them and that the receipts would be given back within 7 days of the handing over of letters in the concerned ward and that the courier company shall deploy two persons in the concerned ward daily at 11.00 AM and that the courier company shall maintain proper security and secrecy of the material being delivered and provide bags in sufficient numbers to protect the deliverables from rain and misplacement. and at item no.3 it was stated to be categorically made clear by the department that any 33/41 lapse or deviation on the part of the courier company shall be viewed seriously and may call for suitable action against the service provider.
30. In the letter dated 22.9.2003 Ex.PW1/7 written by the department to the courier company it is mentioned in para 8 that whereas the courier company has not been able to satisfy the terms and conditions mentioned above which amounts to deficiency in service provided and the contract awarded to the courier service was cancelled and work of delivery of letters was being awarded to the next lowest bidder at the risk and cost of the courier company. Further in para 7 of the letter it is mentioned that the terms and conditions mentioned at the time of issuance of the tender provided that the letter to be delivered shall contain 4-5 pages (both side printed) and full address and envelopes would be provided to the courier service who was required to address the envelope and deliver to the dealers and since the number of pages were increased to 7 the conditions of putting envelope was waived, thus making the volume weight of article to the same and further the condition for writing the address by courier service was also done away with to the advantage of the courier company 34/41 but still the courier company failed to provide the service satisfactorily.
31. From the said depositions and documents on the record it is quite evident that both the parties were reluctant to fulfill their respective duties and liabilities under the contract Ex.PW1/3. The letter Ex.PW1/7 categorically admitted that the number of pages were increased to 7 and the condition of putting envelope was waived to make the volume weight of article to the same but at the same time in the alleged meeting Ex.PW1/5 at point 2 (iv) the courier company was required to maintain proper security and secrecy of the material being delivered. This is nothing but self contradictory term imposed upon the courier company on the one hand, the letters without envelope were required to be delivered and on the other hand the security and secrecy of the letter of the material delivered in the letter was required to be maintained. Increasing of pages upto 7 was admittedly nowhere mentioned in the tender Ex.PW1/3. Moreover, it was mentioned that delivery of letters was on time bound basis but the department concerned has failed to provide any 35/41 schedule of time nor same was mentioned in any of the document or correspondence exhibited on the record. Further it is quite evident that delivery of Traders Identification Number was never mentioned in the tender Ex.PW1/3 which was a specific purpose as mentioned in the plaint of the government and if that was the specific purpose that a particular scheme or change of taxation system was being introduced, it should have been mentioned in the tender notice itself or in the terms and conditions thereof but it was not done. It was also not conveyed to the courier company by the department in its letter Ex.PW1/1 dated 6.6.2003 whereby the department has accepted the bid of the courier company nor the same was mentioned in the letter Ex.PW1/31 dated 13.8.2003 whereby it was directed that courier service would start functioning from 18.8.2003.
32. The department by way of evidence as discussed above has miserably failed to prove any of the complaints against the working of the courier company either producing the complainant officials of the department or the complaints received from the dealers of the department. Moreover, the 36/41 termination of the tender agreement of the courier company on 22.9.2003 vide letter Ex.PW1/7 without giving any show cause notice to the courier company and awarding the tender to the next lowest bidder which has started functioning just after two days, i.e., 24.9.2003 is also a strong circumstance against the government that it has prepared the ground to award the contract to the next lowest bidder and that was why M/s Skylark Express started working just after two days of the termination of the agreement of the courier company whereas initially, although the contract was awarded to the courier company in March, 2003 but the work was allowed to be carried out by it w.e.f. 18.8.2003 which establishes that the government was not really interested in carrying the terms and conditions of the tender but the department wanted to get rid of the courier company. All this go to establish that the department did vary the terms and conditions of the tender agreement by imposing conditions after conditions on the courier company. Hence, the government cannot be allowed to take the benefit of its own wrong by cancelling the tender agreement vide letter Ex.PW1/7 unilateraly and claiming the alleged loss suffered by it due to the 37/41 appointment of the second lowest bidder to continue the work. No document appointing the next lowest bidder has been placed or proved on record in order to show that it was the same tender with the same terms and conditions which was being carried out by the next lowest bidder. Thus, the government miserably failed to point out the deficiency in the service of the courier company or violation of the terms of the agreement by the courier company.
33. At the same time, the courier company can be said to be deficient in its services firstly because when the terms were being varied say by the minutes of meeting Ex.PW1/5, it did not stop the work but continued the same. As alleged by the courier company that it continued to work because of the assurance of the increase of rates to Rs.7/- and it is clearly mentioned in the deposition of PW1 that the courier company otherwise would not have continued with the work but for the assurance of the said increase in the charges per unit. Moreover, the courier company also failed to establish as to how many persons were deployed by it ward-wise for the delivery of the letters and it also miserably failed to prove on the record as to when the said deployed staff of the courier 38/41 company used to attend the work of the department. The courier company has not prayed in the suit demanding any mandatory injunction against the government to continue with the tender agreement in case the termination of the tender agreement is held illegal or invalid. This conduct of the courier company also go to establish that it was also not interested in carrying out the terms and conditions of the tender agreement Ex.PW1/3. Moreover, in para 8 of the paint the courier company has mentioned that the tender agreement was void abinitio but at the same time, the suit has been filed under the very same agreement which also goes against the claim of the courier company.
34. The said conduct on behalf of both the parties is sufficient for me to draw the inference that the government in suit no.1104/08 failed to prove that there was a deficiency in service of the courier company and at the same time the courier company also failed to explain as to how the same was efficient in providing the service and what was its manpower deployed even after coming to know that it was the delivery of TIN number which was time bound. Hence, the said two issues are decided against both the parties although the onus 39/41 to prove the same was only on the government/department and as such, the department was not justified in terminating the contract vide letter Ex.PW1/7 nor the courier company was ready and willing to perform its part of the contract upto the expectation of the government/department. The said two issues are accordingly disposed of.
35. Issue no.1 in suit no.1103/08 "Whether Plaintiff is entitled to the decree of Rs.3 Lacs as prayed? (OPP) Issues no.2 and 3 in suit no.1104/08 "Whether the plaintiff is entitled for any amount from the defendant, if so what amount and Whether the plaintiff is entitled for any interest, if so, on what amount, at what rate and from which period?"
In view of my holding on the above said issues the courier company is not entitled to the decree of Rs.3 Lacs as prayed for subject to the relief granted in this judgment as mentioned below and accordingly issue no.1 in suit no.1103/08 is decided against the courier company and 40/41 similarly as the government varied the terms and conditions of the original tender as held by me above the issues no.2 and 3 in suit no.1104/08 are also decided against the government.
36. Issue no.4 Relief in suit no.1103/08 In view of my findings that both the parties have been held disentitled to their respective reliefs claimed in their respective suits and in view of my holding on issue no.2 in suit no.1103/08 that the plaintiff was not entitled to rate of Rs.7/-, in the present suit, the doctrine of restitution comes into play. As per doctrine of restitution parties are to be restored to their original position as if they have not suffered any loss on account of the action of the other party or under any contract or agreement.
37. Admittedly, the courier company has delivered 25,967 on the agreed rate was Rs.2.80 per unit as per bid given by the courier company and thus the courier company is held entitled to recover an amount of Rs.72,707.60. Admittedly, the courier company has deposited a sum of Rs.50,000/- as security with the department which the courier company is entitled to received back the said amount from the department. Accordingly, a decree in the sum of Rs.1,22,708/- 41/41 (by making it a round figure) together with an interest @ 6% p.a. is passed on the said amount w.e.f. 22.9.2003, the date of termination of the agreement in favour of the courier company and against the government/department.
1. The suit no.1104/08 filed by the government/department is hereby dismissed. Parties to bear their own cost. Copy of this judgment be placed on both the suits and decree-sheets be prepared accordingly. The files be consigned to the record room.
ANNOUNCED IN THE OPEN COURT ON 5.2.2009 (RAKESH TEWARI) ADDL. DISTRICT JUDGE:
DELHI.