Delhi District Court
M/S Ramacivil India Construction Pvt. ... vs Nbcc India Limited on 28 April, 2025
IN THE COURT OF SH. LAL SINGH,
DISTRICT JUDGE (COMMERCIAL COURT-01),
SOUTH-EAST, SAKET COURTS, NEW DELHI
CS (Comm) No. 134/2023
In the matter of:
M/s Ramacivil India Construction Pvt. Ltd.
Office at BP-22, West Patel Nagar,
Delhi-110008
Through its Director
Sh. R. N. Gupta
Email: [email protected]
......... Plaintiff
Versus
M/s NBCC (India) Ltd.
Corp. Off. NBCC Bhawan,
Lodhi Road, New Delhi-110003
Through its Chairman/MD
Email: [email protected]
[email protected]
........ Defendant
Date of institution : 10.02.2023
Date of reserving judgment : 07.03.2025
Date of judgment : 28.04.2025
JUDGMENT
1. The present suit has been filed by the plaintiff against the defendant for recovery of Rs.1,66,90,570/- alongwith interest @ 14% per annum.
2. It is stated that the plaintiff company duly incorporated under the Companies Act and is also enlisted contractor in various Govt. Departments including the defendant. The plaintiff was earlier a Partnership CS (Comm) No. 134/2023 Page 1 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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signed by lal
lal singh
Date:
singh 2025.04.28
16:29:35
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firm and operating under the name and style of M/s Rama Construction Company which has been converted into a Private Limited Company and the name of the entity has been changed to M/s Ramacivil India Construction Pvt. Ltd. vide certificate of incorporation dated 11.08.2017. The defendant is a Government of India Enterprises. The defendant awarded the work of "Execution of balance work of Multistoried Multi Activity Centre (excluding balance work of the public block) at IIT Roorkee, at risk and cost of previous contractor" vide Letter of Acceptance bearing no. NBCC:ED:RBG NORTH:LOA:IIT-ROORKEE:2014:4157 dated 24.01.2014 to the plaintiff on a total contractual price of Rs.11,95,87,558/- (Eleven Crore Ninety Five Lakh Eighty Seven Thousand Five Hundred Fifty Eight only). The duration of the work was for the period of 6 months with the stipulated date of start of the work being 03.02.2014 and stipulated date of completion of this work was 02.08.2014. On submission of the performance guarantee as requested in the letter of award, an agreement dated 30.01.2014 was entered into between the parties. Plaintiff averred that the plaintiff has started the work in right earnest and physically completed on 25.01.2015 and handed over the project to the client on 25.03.2015. The plaintiff has submitted/sent letter dated 02.01.2015 with supporting documents thereby making request for release of amount of executed NS items. It is also stated that the stipulated date of completion of work was 02.08.2014 and the delay in completion of the work and handing over the completed work was not on the part of the plaintiff. The reasons of delay were already intimated by the representative of the plaintiff which was recorded in the hindrance register. The plaintiff further completed the 12 months defect liability period as per the contract which expired on 24.03.2016.
3. The plaintiff submitted its 10 th RA Bill on 31.01.2015 which CS (Comm) No. 134/2023 Page 2 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd. Digitally signed by lal lal singh Date:
singh 2025.04.28 16:30:30 +0530 was certified for an amount of Rs.48,06,451/- and out of which after necessary adjustment, an amount of Rs.28,90,731/- was withheld. Plaintiff further submitted its 11th & Final Bill on 17.06.2015 which remained unpaid to the extent of Rs.1,03,97,289/- as on April, 2017 and the security deposit of Rs.11,35,969/- (deducted from the RA Bills) was also due and payable as the defect liability period had expired on 24.03.2016. The defendant issued performance report with respect to this work on 16.03.2015. As on 17.04.2017, defendant department was liable to pay an amount of Rs.1,44,23,989/- and the plaintiff gave a letter dated 17.04.2017 to the defendant requesting for release of this amount. The defendant has sent the reply of this letter on 25.04.2017 thereby relying on clause 37.3 of GCC and assuring that the due payment as and when received from the client, the same shall be released to the plaintiff. Thereafter, certain payments were released by the defendant department. The plaintiff had submitted the letters dated 12.01.2019 and 05.03.2019 thereby requesting to release the balance amount of 10th and 11th RA bills with interest. The defendant in reply of letter dated 12.01.2019 sent letter dated 13.03.2019 wherein the defendant in response to the request of the plaintiff have relied upon Clause 37.3 of GCC to state that the payment to the contractor is to be released after the corresponding payment made by the client. Further, the plaintiff has received an email in reply to its letter dated 05.03.2019, on 12.04.2019 from IIT, Roorkee. It was requested through this email that kindly correspondence directly with the defendant as this work was executed by the plaintiff through defendant and all the dispute and settlement are to be handled by the defendant only. The defendant in response to that email, sent an email dated 27.05.2019 to the plaintiff thereby directing the plaintiff to comply and submit certain documents for processing the final bill which was later submitted by the CS (Comm) No. 134/2023 Page 3 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd. Digitally signed by lal lal singh Date:
singh 2025.04.28 16:31:16 +0530 plaintiff to the satisfaction of the defendant. Thereafter the plaintiff pursued the matter with the defendant and on the direction of the defendant, the plaintiff had again submitted the copy of 11 th final bill with letter dated 18.07.2019 for further action to be taken by the defendant. The plaintiff has submitted letters dated 27.01.2021 and 20.05.2021 with details of the claims in the office of defendant with request for release of the due amount of Rs.3.25 Crore. The defendant has again taking the same plea stating that the client has not released the amount and as and when, the same will be received, the defendant will release the amount. Thereafter, the plaintiff had served the defendant with a legal notice dated 25.04.2022 in compliance of provisions of Section 80 CPC and same has been duly delivered. As per the plaintiff, the claims of the plaintiff are as under:
Sl.
Particulars Amount (In Rs.)
No.
1 Release of the balance security deposit amount 6,16,117/-
th
2 Release of withhold amounts from the 10 RA Bills 28,90,731/-
Release of final bill amount
3 Passed: Rs.66,86,091/- 72,95,826/-
No Passed: Rs.6,09,735/-
Interest on Claim No. 1 to 3 @ 14% p.a w.e.f
4 58,87,901/-
13.03.2019 till 31.01.2023 (1421 days)
Total 1,66,90,570/-
Direction for release of GST amount on submission 5 Declaratory Claim of receipt of payment.
Amount of Court Fee + 6 Cost Actual Fee paid to the lawyer and misc. expenses.
As such, the plaintiff has filed the present suit against the defendant for recovery of Rs.1,66,90,570/- alongwith pendente lite and future interest @14% per annum and cost.
4. The defendant has filed the written statement. In the written CS (Comm) No. 134/2023 Page 4 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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lal singh
Date:
singh 2025.04.28
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statement, it is contended that the plaint is devoid of any merit as well as any cause of action against the defendant as the claims of the plaintiff relates to the year 2015 and thus, the present suit is hopelessly barred by time. It is also contended that the suit is also liable to be dismissed for non-joinder of parties, as the plaintiff was well aware that the payment would be made only if received from the owner of the project i.e. IIT Roorkee and has not made the owner as a party in the present suit. It is further contended that the interest levied on the defendant is totally uncalled for and baseless as the agreement dated 30.01.2014 governed by NBCC General Conditions of Contract (GCC) signed by the parties and accepted all terms and conditions therein. Further, as per Clause 37.3 of GCC, the contractor will receive the payment only after NBCC receives the payment from IIT Roorkee and therefore, interest levied for the same on the defendant is frivolous on the face of it.
5. It is contended that the defendant awarded the work on 24.01.2014 to the plaintiff on a total contractual price of Rs.11,95,87,558/-. The duration of the work was for the period of 6 months with the stipulated date of start of the work being 03.02.2014 and the Performance Guarantee as requested in the letter of award as Rs.59,79,378.00 (5% of contract value) and an agreement dated 30.01.2014 was entered into between the parties. It is contended that the contract was awarded to the plaintiff on the risk and cost of earlier contractor i.e. M/s Alliance Infra Developers (India) Pvt. Ltd and since M/s Alliance Infra Developers (India) Pvt. failed to clear all the dues to NBCC and hence, NBCC filed a recovery suit of Rs. 1.80 crore on the earlier contractor i.e. M/s Alliance Infra Developers (India) Pvt. Ltd., in the Hon'ble High court of Delhi in 2015, which is still under trial. It is contended that the suit filed by the plaintiff seeking recovery of Rs.
CS (Comm) No. 134/2023 Page 5 of 24
M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd. Digitally
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lal singh
Date:
singh 2025.04.28
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1,66,90,570/- with interest @ 14% P.A., is baseless, having no merit and liable to be dismissed. Defendant also contended that the plaintiff claims that the Public block (A&D) was handed over to the owner/defendant on 25.01.2015, whereas on the contrary, vide copy of minutes of the meeting scheduled on the same day, balance / rectification work of Multi Activity Center was explicitly discussed with the owner in the presence of plaintiff and various defects & rectifications were pointed out by the owner. Though the plaintiff claims that delay in completion of the work and handing over the completed work was not on the part of the plaintiff and the reason of delay was recorded in the hindrance register and the said register has not been supplied to the plaintiff, whereas on the contrary it is clarified by the defendant that the hindrance register is in possession of the plaintiff from the beginning of the matter. It is contended that the 11 th & final bill to the plaintiff can be made only after receipt of the corresponding payment from IIT-Roorkee i.e. the Client. It is contended that as on date, corresponding payment has not been received from the owner (IITR). It is further submitted that on various occasions through letters and emails, the defendant has communicated to the plaintiff that in accordance with clause 37.3 of GCC signed and accepted by the plaintiff payment to the plaintiff can be made only after receipt of the corresponding payment from the owner. It is further stated that the defendant herein vide email dated 27.05.2019 directed the plaintiff to furnish certain documents, however, the plaintiff has till date not furnished the documents as per the records available at unit office. Thus, it is clear that the plaintiff is trying to paint a false narrative of alleged non- payment of dues despite failing on multiple occasions to fulfill acts in accordance with the contractual obligations. It is submitted that the defendant had awarded several contracts to the plaintiff for carrying out CS (Comm) No. 134/2023 Page 6 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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signed by lal
lal singh
Date:
singh 2025.04.28
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various works. One of such work was pertaining to the construction of NBCC Green View at Sector 37D, Gurugram. The said work was a real estate project. The defendant had paid an amount aggregating to Rs.191.42 crore to the plaintiff from time to time for the said project. Owing to various complaints received from home-buyers regarding the quality of work as well as defects pointed out in various reports of Quality Audit, Technical Audit, Vigilance & CTE, the defendant had appointed Indian Institute of Technology, Delhi [IITD] to carry out an examination of the structural soundness of work in October 2020. In this regard vide its initial report of October 2020, the IITD pointed out the poor quality of work in the project and further vide its interim report dated 29,12.2020, IITD pointed out several issues in the project which required repair works to be carried out. Subsequently, a final report dated 02.02.2021 was thereafter issued by IITD wherein the repair methodology for the building prepared by the consultant appointed by the plaintiff was recommended by IITD and thereafter the rectification work was taken up in certain towers of the project. Accordingly, in its follow up report dated 06.10.2021, IITD noted continuing deterioration in the structure of the project at an accelerated pace. In light of the same, IITD advised that the complex would require to be evacuated, within a period of 2 months in the interest of the safety of residents, and thereafter a comprehensive analysis would have to be carried out regarding the feasibility of repair of the entire structure. Further, the District Magistrate cum Chairperson of District Disaster Management Authority, Gurugram vide order dated 17.02.2022 also directed the residents to evacuate the premises for safety considerations and as on date the project stands vacated. It is contended that due to poor quality of work executed by the plaintiff in NBCC Greenview, Gurugram Project, the defendant has accordingly CS (Comm) No. 134/2023 Page 7 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd. Digitally signed by lal lal singh Date:
singh 2025.04.28 16:31:44 +0530 withheld amounts of plaintiff in various works of the defendant company as per withholding and lien clause of GCC. It is submitted that in view of the huge losses incurred by the defendant in respect of construction of another project NBCC Green View, Sector 37D, Gurugram, the defendant has filed suit bearing CS (Comm.) 153/2023 for recovery of Rs. 750 Crores. It is submitted that defendant reserves the right to withhold any payments that may be received from the client i.e. IITR in future in line with clause 73 of the GCC. Reply on merits also, defendant mostly denied the contentions of the plaintiff and reiterated the averments as made in the preliminary submissions of the written statement.
6. Plaintiff has also filed the replication to the written statement of the defendant wherein plaintiff denied the contentions of the written statement of the defendant and reiterated the averments of the plaint.
7. After completion of pleadings vide order dated 07.03.2024, following issues were framed:
1. Whether the plaintiff is entitled for recovery of Rs.1,66,90,570/- from the defendant? OPP.
2. Whether the plaintiff is entitled to interest, if so, at what rate and for which period? OPP.
3. Whether the suit of plaintiff is barred by limitation? OPD.
4. Relief, if any.
8. Thereafter, the plaintiff led the evidence and examined Sh. Ram Niwas Gupta @ R.N. Gupta, as PW1. PW1 Sh. Ram Niwas Gupta @ R. N. Gupta has tendered his evidence by way of affidavit vide Ex. PW1/A and in his evidence, he also relied upon the following documents:
S. No. Documents Exhibit
1. Certificate of registration of plaintiff company. Ex. PW-1/1
CS (Comm) No. 134/2023 Page 8 of 24
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2. The details of director of plaintiff company. Ex. PW-1/2
3. Board resolution dated 20.02.2022. Ex. PW-1/3
4. Letter of acceptance dated 24.01.2014. Ex. PW-1/4 Agreement dated 30.01.2014 along with relevant
5. Ex. PW-1/5 clauses of contract applicable to the project.
6. Letter of plaintiff dated 02.01.2015. Ex. PW-1/6 7 10th RA Bill dated 31.01.2015. Ex. PW-1/7
8. 11th and Final bill dated 17.06.2015. Ex. PW-1/8
9. Performance report dated 16.03.2015. Ex. PW-1/9
10. Letter of plaintiff dated 17.04.2017. Ex. PW-1/10
11. Reply of the defendant dated 25.04.2017. Ex. PW-1/11
12. Letter of plaintiff dated 12.01.2019. Ex. PW-1/12
13. Letter of plaintiff dated 05.03.2019. Ex. PW-1/13
14. Letter of defendant dated 13.03.2019. Ex. PW-1/14
15. Email dated 12.04.2019. Ex. PW-1/15
16. Email dated 27.05.2019. Ex. PW-1/16 Email dated 22.05.2019 along with its attachment
17. Ex. PW-1/17 being letter dated 22.05.2019.
18. Postal receipt dated 22.05.2019. Ex. PW-1/18
19. Letter of plaintiff dated 18.07.2019. Ex. PW-1/19
20. Letter of plaintiff dated 27.01.2021. Ex. PW-1/20
21. Letter of plaintiff dated 20.05.2021. Ex. PW-1/21
22. Legal Notice dated 25.04.2022. Ex. PW-1/22
23. Postal Receipt dated 28.04.2022. Ex. PW-1/23
24. Tracking Report. Ex. PW-1/24
25. Certificate of non starter report dated 18.08.2022. Ex. PW-1/25
9. PW1 was cross examined by Ld. counsel for the defendant. In his cross examination, PW1 deposed that date of completion of project was 25.01.2015 and there was delay of 175 days in completion of the project.CS (Comm) No. 134/2023 Page 9 of 24
M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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Date:
singh 2025.04.28
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However, PW-1 denied that the delay was due to the plaintiff. PW-1 further deposed that the delay was on account of pending decision which were to be provided by defendant. He further stated that he had intimated the reason for delay to the defendant orally as well as through letters. PW-1 denied that in view of the contract, plaintiff is not entitled for any interest. PW-1 also denied that plaintiff is in possession of hindrance register concerning the project. He deposed that it is a government record and must be with the defendant. PW-1 also deposed that there was no defect in the project concerning the present case and if it was intimated then it was rectified at the relevant time. He also deposed that since the defects were rectified as and when pointed out and hence, no document sent to that effect. PW-1 admitted that defendant had asked for certain documents including test certificates, quarterly register, etc. and he stated that they have provided the same. Further, PW-1 admitted that as per clause 37.3 of the contract, plaintiff was entitled to receive the payment only after defendant receives the payment from the end owner. However, he stated that it was the deposit work of IIT Roorkee. PW-1 also deposed that he had received Ex.PW-1/16 i.e. email from IIT Roorkee, which states that NBCC is a PMC agency and it is the deposit work and the plaintiff may approach to the defendant. PW-1 also admitted that defendant sent an email dated 27.05.2019 to him regarding submitting of certain documents. In his cross examination, PW-1 admitted that there was a bar on interest on delayed payments as per the contract. PW- 1 also admitted that plaintiff was awarded construction of NBCC Green View at Sector 37-D, Gurugram. PW-1 denied that there is any such clause to recover the amount from other contract. However, he stated that there is a clause for lien and withhold of the amount.
10. Thereafter, defendant led the evidence and examined Sh.
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M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd. Digitally
signed by lal
lal singh
Date:
singh 2025.04.28
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Mandeep Singh as DW1, who has tendered his evidence by way of affidavit vide Ex.DW1/1. DW1 has also relied upon the following documents:
S. No. Documents Exhibit
1. Minutes of meeting dated 25.01.2015. Mark DW-1/2
2. Letter dated 28.02.2015. Mark DW1/3
3. Letter dated 25.04.2017. Ex. DW1/4
4. Email dated 27.05.2019. Ex. DW1/5
11. DW1 was cross examined by Ld. Counsel for the plaintiff. In his cross examination, DW1 admitted that post July, 2014, he had no concern with the present project. He deposed that averments made in his affidavit, post July, 2014 related to the present project, are on the basis of records. He also deposed that as per records, the handing over of the project had taken place on 25.01.2015 to IIT Roorkee. DW-1 also stated that the defendant made correspondence in writing with IIT Roorkee for release of the payment due to the plaintiff on account of work done and certified bill between the period January, 2015 till the filing of the written statement in the present proceedings. However, he deposed that such correspondence is not on record. DW-1 also deposed that the defendant (NBCC) has not placed on record the ledger of NBCC being maintained for the present project of IIT Roorkee showing the amount received from IIT Roorkee. DW-1 denied that the defendant has deliberately not placed the ledger on record as that would have shown that the amounts have been received from IIT Roorkee to NBCC. DW-1 admitted that since January, 2015 till date, the building constructed by the plaintiff in furtherance of the present project is in use and occupation of IIT Roorkee. DW-1 shown his ignorance regarding that there is no such letter levying any penalty or any recovery on NBCC by IIT Roorkee for the work done under the present project since January, 2015 till CS (Comm) No. 134/2023 Page 11 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd. Digitally signed by lal lal singh Date:
singh 2025.04.28 16:32:08 +0530 date. DW1 stated that he is not directly involved with the project at the moment. DW-1 also deposed that till the time he was associated with the present project Engineering-in-Charge of the defendant, not issued any letter under clause 73 of GCC. He also deposed that there is no such letter available on record. DW-1 also admitted that he has no knowledge about the project of NBCC Green View, Sector 37, Gurugram. DW-1 also deposed that no corresponding payment has been received from IIT Roorkee in respect of claims No.1 to 3. DW-1 deposed that post 25.01.2015 till filing of the written statement by the defendant, there is no such letter from IIT Roorkee, pointing out any defects remaining in the work done by the plaintiff. DW-1 denied that since there was no defects remaining to be cured by the plaintiff after 25.01.2015, hence, there was no letter issued by IIT Roorkee.
12. Arguments heard.
13. Ld. Counsel for the plaintiff submitted that the work was awarded on 24.01.2014 to the plaintiff and the total contractual price of work was Rs.11,95,87,558/-. Plaintiff has raised total 11 bills and out of which, initial 9 bills were cleared by the defendant. He submitted that the dispute is regarding 10th and 11th bills. He also submitted that the defendant has withheld an amount of Rs.28,90,731/- in respect of 10 th RA Bill i.e. Claim No.2 in the present case. He also submitted that regarding 11 th RA Bill, claim is of Rs.72,95,826/- i.e. Claim No.3. He further submitted that the claim No.1 is in respect of balance security amount of Rs.6,16,117/-. He submitted that the plaintiff is also claiming interest on claims No.1 to 3 for a sum of Rs.58,87,901/- @ 14% per annum. It is argued that the project work was completed on 25.01.2015, as mentioned in performance report Ex.PW1/9, wherein actual date of completion is mentioned as 25.01.2015. Plaintiff has submitted that 11th & final bill Ex.PW-1/8 on 17.06.2015. Further, on CS (Comm) No. 134/2023 Page 12 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
Digitally
signed by lal
lal singh
Date:
singh 2025.04.28
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17.04.2017 vide Ex.PW-1/10, plaintiff issued request letter for release of 10 th and 11th bills amount. Further, vide letter dated 25.04.2017 Ex.PW-1/11, defendant replied to the letter dated 17.04.2017 of plaintiff, in which defendant stated that as soon as corresponding payment will be received from client, the same will be released to the plaintiff. Thereafter, on 12.01.2019 vide Ex.PW-1/12, plaintiff again sent letter to the defendant for release of payment. Further, letter issued on 05.03.2019 in this regard. It is also argued that on 13.03.2019 vide Ex.PW-1/14, defendant has sent reply to the letter dated 12.01.2019, stating that payments are still due to be received from IIT Roorkee and advised to the plaintiff to bear with them. Further, vide email dated 12.04.2019 Ex.PW-1/15, IIT Roorkee sent reply to the letter dated 05.03.2019 of plaintiff, stating that all the disputes and settlement will be handled/made with NBCC Ltd. He also argued that the project was successfully completed and handed over by the plaintiff on 25.01.2015 and defect liability period of 12 months as per contract ended on 24.03.2016. On 17.04.2017, plaintiff made request within 3 years for release of outstanding payments. He also argued that on 25.04.2017, defendant replied to the letter dated 17.04.2017, thereby acknowledged the debt/liability unconditionally. He submitted that defendant lastly acknowledged the liability on 13.03.2019. Moreover, vide email dated 27.05.2019 Ex.PW-1/16, defendant advised to the plaintiff to submit certain documents. He also argued that plaintiff is also entitled for extension clause for the purpose of limitation during the period of Covid. As such, he submitted that the present suit is within limitation. Further, he submitted that DW-1 in his cross examination not disputed or denied 10 th and 11th RA Bills as placed on record. He argued that the defendant has not brought anything on record regarding deficiency in other projects.
CS (Comm) No. 134/2023 Page 13 of 24M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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lal singh
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singh 2025.04.28
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14. On the other hand, Ld. Counsel for the defendant submitted that the defendant has rightly withheld the amount of Rs.28,90,731/- qua 10 th RA Bill. He submitted that even PW-1 in his cross examination stated that the defendant can exercise lien over the due amount. He submitted that clause 73 of GCC provides for lien in respect of claims in other contracts. He submitted that the plaintiff has failed to show the basis on which the 11 th RA bill has been raised. Further, plaintiff has not fulfilled the terms and conditions of the contract. He further submitted that vide email correspondence Ex.PW-1/16, defendant sought list of mandatory documents, however, the plaintiff has not provided the said documents. It is also argued that the instant suit is barred by limitation. He submitted that the instant suit filed by the plaintiff is liable to be dismissed.
15. I have considered the above submissions of Ld. counsel for the plaintiff and Ld. counsel for the defendant and also perused the file and gone through the evidence on record. Further, I have also considered the case laws as relied by the Ld. Counsels for the parties.
16. My issue wise findings are as under:
Firstly, I shall deal with issue no.3.
ISSUE No.3: Whether the suit of plaintiff is barred by limitation? OPD.
The onus to prove the issue no. 3 is upon the defendant. In the written statement it is the contention of the defendant that the claims of the plaintiff relate to the year 2015 and thus, the present suit is hopelessly barred by time. However, in its replication, the plaintiff denied the said contention of the defendant. Plaintiff submitted that final bill was raised in the year 2015, which was certified and remained pending and defendant itself in its letter dated 25.04.2017 acknowledged that the amount will be paid to the CS (Comm) No. 134/2023 Page 14 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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lal singh
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singh 2025.04.28
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plaintiff after receiving the corresponding payments from client and thereafter, vide letter dated 13.03.2019, similar acknowledgment has been given by the defendant. As per the plaintiff, Section 18 of the Limitation Act, provides for fresh period of limitation when before expiration of the prescribed period, an acknowledgment of liability has been made in writing, which is signed by the party against whom such right has been claimed, gives rise to a fresh period of limitation. In the instant matter, on 17.04.2017 vide Ex.PW-1/10, plaintiff issued request letter for release of 10 th and 11th RA Bills amounts. Thereafter, vide letter dated 25.04.2017 Ex.PW-1/11, defendant replied to the letter dated 17.04.2017 of plaintiff, stating therein that as soon as corresponding payment will be received from client, the same will be released to the plaintiff. In the said letter, it is specifically mentioned that "it is reiterated that your due payment as & when received from the client, the same shall be released to you". Thereafter, on 12.01.2019 vide Ex.PW-1/12 and letter dated 05.03.2019 Ex.PW1/13 plaintiff again sent letters to the defendant for release of payment. Further, vide letter dated 13.03.2019 Ex.PW-1/14, defendant has sent reply to the letter dated 12.01.2019, stating therein that the payments are still due to be received from IIT Roorkee and advised to the plaintiff to bear with them. Further, vide email dated 12.04.2019 Ex.PW-1/15, IIT Roorkee sent reply to the letter dated 05.03.2019 of plaintiff, stating that "all the disputes and settlement will be handled/made with NBCC Ltd.". Moreover, vide email dated 27.05.2019 Ex.PW-1/16, defendant advised to the plaintiff to submit certain documents. The work was awarded to the plaintiff on 24.01.2014 and plaintiff completed the work on 25.01.2015 vide Ex.PW-1/9 i.e. performance report. In the said performance report Ex.PW-1/9, it is specifically mentioned that actual date of completion of work as 25.01.2015. Plaintiff CS (Comm) No. 134/2023 Page 15 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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singh 2025.04.28 16:32:36 +0530 has raised 11th & final bill Ex.PW-1/8 on 17.06.2015. Further, as per clause 37.3 of GCC (General Conditions of Contract), it is mentioned that notwithstanding anything to the contrary that may be stated in the agreement between NBCC and contractor, the contractor shall become entitled to payment only after NBCC has received the corresponding payment(s) from the client/owner for the work done by the contractor. All this shows that defendant was seeking time for payments of the amounts due to the plaintiff on the ground that the corresponding payments have not been received from the client i.e. IIT Roorkee. Further, as per Clause 74 of GCC, there was 12 months defect liability period. In the instant matter, the said defect liability period expired on 24.03.2016. Thus, from the said date i.e. expiry of defect liability period dated 24.03.2016 or otherwise from the date of raising bill dated 17.06.2015 vide Ex.PW-1/8, the three years period for recovery of outstanding dues of the plaintiff would expire on 24.03.2019 and 17.06.2018 respectively. Even, it is taken from 25.01.2015 when the project was completed, three years period expired on 25.01.2018. However, the plaintiff has raised the issue of release of payments from the defendant as well as IIT Roorkee from 17.04.2017 onwards. The defendant time and again sought time for payment of outstanding amount of the plaintiff on the ground that the corresponding payments not received from the client i.e. IIT Roorkee.
Therefore, the fresh period of limitation started from the above mentioned respective dates on which the defendant acknowledged the due payment to the plaintiff and sought time for payments on the premise that same will be made as and when received from the client i.e. IIT Roorkee. Defendant lastly sent such letter to the plaintiff on 13.03.2019 vide letter Ex.PW1/14 and IIT Roorkee also sent email in respect of the same on 12.04.2019 vide Ex.PW1/15 to the plaintiff as already discussed above. Further, in the instant CS (Comm) No. 134/2023 Page 16 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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matter, the plaintiff has filed application for pre-institution mediation on 21.06.2022 and non-starter report was given on 18.08.2022 vide Ex. PW1/25 and this period is required to be excluded for the purpose of limitation in filing the present suit. Moreover, the plaintiff is also entitled to the extension clause for the purpose of limitation, for the period 15.03.2020 to 28.02.2022, during the Covid-19 Pandemic period, in terms of order dated 10.01.2022 passed by Hon'ble Supreme Court of India in Suo Motu writ petition (C) No. 3 of 2020. The plaintiff has filed the present suit on 10.02.2023. Thus, the plaintiff has filed the present suit well within the limitation period.
Accordingly, the issue no. 3 is decided against the defendant and in favour of the plaintiff.
17. ISSUE No. 1: Whether the plaintiff is entitled for recovery of Rs.1,66,90,570/- from the defendant? OPP.
The onus to prove this issue is upon the plaintiff. So as to prove its case, the plaintiff has examined PW1 Sh. Ram Niwas Gupta @ R.N. Gupta, who has tendered his evidence by way of affidavit vide Ex. PW1/A and also relied upon the documents Ex. PW1/1 to Ex. PW1/25. It is the case of the plaintiff that the defendant awarded the work of "execution of balance work of Multistoried Multi Activity Centre (excluding balance work of the public block) at IIT Roorkee at risk and cost of previous contractor" vide letter of acceptance dated 24.01.2014 Ex.PW1/4 to the plaintiff for a total contractual value of Rs.11,95,87,558/-. The work was to be completed within a period of six months with the stipulated date of start of work being 03.02.2014 and stipulated date of completion of the work was on 02.08.2014. The agreement dated 30.01.2014 alongwith relevant clauses of contract applicable to the project was also entered between the parties vide Ex.PW1/5. Plaintiff submitted that plaintiff had started the work in right CS (Comm) No. 134/2023 Page 17 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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earnest and completed the work on 25.01.2015. DW1 Sh. Mandeep Singh in his cross examination also deposed that as per record, handing over of the project had taken place on 25.01.2015 to IIT Roorkee. DW1 also admitted that since January 2015, the building constructed by the plaintiff in furtherance of the present project is in use and occupation of IIT Roorkee. DW-1 further stated that no letter issued by the IIT Roorkee post 25.01.2015 to the defendant pointing out any defect in the project. Further, as per plaintiff, delay in completion of work and handing over the completed work was not on the part of the plaintiff. It is also the contention of the plaintiff that the plaintiff also completed 12 months defect liability period as per the contract which expired on 24.03.2016. It is also submitted by the plaintiff that the reason of delay were already intimated by the plaintiff which was recorded in the hindrance register, however the copy of the said hindrance register was not supplied to the plaintiff. In his cross examination also, PW1 deposed that hindrance register is in the custody of the defendant. Moreover, regarding delay in completion of work, the defendant has not placed any documents on record if the defendant has issued any letter to the plaintiff for delay of completion of work / project due to the plaintiff. Thus, there is force in the contention of the plaintiff that the delay in completion of the project was not on the part of the plaintiff. The instant suit has been filed by the plaintiff regarding 10th RA bill and 11 th & final bill. The plaintiff submitted 10th RA bill on 31.05.2015 and 11 th & final bill on 17.06.2015. In the instant suit, the plaintiff has claimed Rs.6,16,117/- qua release of balance security deposit amount, release of withhold amount from the 10 th RA bill for a sum of Rs.28,90,731/- and release of final bill amount of Rs.72,95,826/-. Further, the plaintiff is also seeking Rs.58,87,901/- as interest @ 14% per annum on above claims for the period from 13.03.2019 till 31.01.2023. However, the CS (Comm) No. 134/2023 Page 18 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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applicability of interest shall be dealt with, while dealing with Issue no.2. The defendant has not paid the above mentioned outstanding amount in respect of 10th RA Bill and 11th & final bill as well as security amount as claimed by the plaintiff. The plaintiff has issued several letters to the defendant on 17.04.2017 vide Ex.PW1/10, on 12.01.2019 vide Ex.PW1/12, on 05.03.2019 vide Ex.PW1/13 for payment of outstanding amount to the plaintiff, however defendant in its reply dated 25.04.2017 vide Ex.PW-1/11 not denied the outstanding due amount of the plaintiff, rather defendant replied to the plaintiff that as soon as the corresponding payment will be received from the client (IIT Roorkee), the same will be released to the plaintiff and further vide letter dated 13.03.2019 Ex.PW1/14, defendant replied to the plaintiff stating that the payments are still due to be received from IIT Roorkee and also advised to the plaintiff to bear with them. Thus, it is amply clear that in the above replies of defendant to the letters of plaintiff, defendant has not denied the amount payable by defendant to the plaintiff.
18. It is the contention of the defendant that defendant has right to withhold any payment that may be received from the client i.e. IITR (Roorkee) in future, in line with Clause 73 of GCC. The Clause 73.3 of GCC deals with lien and same is reproduced as under:
73.3 LIEN IN RESPECT OF CLAIMS IN OTHER CONTRACTS Any sum of money due and payable to the contractor (including the security deposit returnable to him) under the contract may be withheld or retained by way of lien by the Engineer-in-Charge or by NBCC against any claim of the Engineer-in-Charge or NBCC in respect of payment of a sum of money arising out of or under any CS (Comm) No. 134/2023 Page 19 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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singh 2025.04.28 16:32:59 +0530 other contract made by the contractor with the Engineering in Charge or the NBCC.
It is an agreed term of the contract that the sum of money so withheld or retained under this clause by the Engineer-in-Charge or the NBCC will be kept withheld or retained as such by the Engineer-in-Charge or NBCC or till his claim arising out of the same contract or any other contract is either mutually settled or determined by the arbitration clause or by the competent court, as the case may be, and that the contractor shall have no claim for interest or damages whatsoever on this account or on any other ground in respect of any sum of money withheld or retained under this clause and duly notified as such to the contractor.
It is contention of the plaintiff that due to poor quality of work executed by the plaintiff in NBCC Green View, Gurugram project, the defendant has accordingly withheld the amount of the plaintiff in various works of the defendant company as per withholding & lien clause of GCC. It is also contented by the defendant that the huge losses incurred by the defendant in respect of constructions of another project NBCC Green View, Sector 37D, Gurugram, by the plaintiff and hence, the defendant has right to withhold the payment in present project in terms of clause 73.3 of GCC. However, in its replication, plaintiff has denied, if any losses incurred by the defendant in respect of construction at NBCC, Green View, Sector 37D, Gurugram project.
In the instant case, defendant has not placed any document on record to show that quality of work executed by the plaintiff in another CS (Comm) No. 134/2023 Page 20 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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project i.e. NBCC Green View, Sector 37D, Gurugram project, was of poor quality. Even, no letter etc., issued by the defendant to the plaintiff if any, placed on record, mentioning the poor quality of work executed by the plaintiff in the above mentioned another project of defendant i.e. Green View, Sector 37D, Gurugram project. The defendant was required to brought on record the document or material so as to show that there was poor quality of work as executed by the plaintiff in Green View, Sector 37D, Gurugram project, however defendant failed to place anything material on record in this regard. Merely, making allegation that due to poor quality of work executed by the plaintiff in another project of defendant i.e. NBCC, Green View, Gurugram project, the defendant has right to withhold amount of the plaintiff in various works/project of the defendant company, as per withholding and lien clauses of GCC is not enough. Defendant is required to establish such allegations against the plaintiff so as to claim lien over the amounts of the plaintiff in terms of Clause 73.3 of GCC. Thus, there is no force in such contentions of defendant regarding withholding the amount of the plaintiff and same is not sustainable and accordingly such contention of the defendant cannot be accepted, particularly in the absence of any material or evidence in that regard. It has been established by the plaintiff that the defendant has not paid the outstanding amount to the plaintiff. In the instant case, plaintiff has claimed that the defendant has not released the amount of Rs.28,90,731/- in respect of 10 th RA Bill and and further not released the 11 th & final bill of Rs.72,95,826/-. However, as per 11th & final bill Ex.PW-1/8, the said amount is mentioned as Rs.72,89,753/-. Further, the plaintiff also claims the balance security deposit amount of Rs.6,16,117/-. Thus, total amount regarding 10 th RA bill, 11th & final bill and balance security deposit amount comes to Rs.1,07,96,601/-. Accordingly, plaintiff has proved its case for recovery of CS (Comm) No. 134/2023 Page 21 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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Rs.1,07,96,601/-. As such, the plaintiff is entitled for recovery of amount of Rs.1,07,96,601/- from the defendant.
Accordingly, issue No.1 is decided in favour of the plaintiff and against the defendant, in above terms.
19. ISSUE No. 2: Whether the plaintiff is entitled to interest, if so, at what rate and for which period? OPP.
The onus to prove this issue is upon the plaintiff. In the instant suit, the plaintiff is seeking interest of Rs.58,87,901/- @ 14% per annum with effect from 13.03.2019 till 31.01.2023 upon claim no.1 to 3 of the plaintiff i.e. upon balance security amount, 10 th RA bill and 11th & final bill. However, it is the contention of the defendant that the plaintiff is not entitled to any interest in terms of clause 37.3 of GCC.
The clause 37.3 of the GCC deals with the applicability of interest. The provision of clause 37.3 of GCC is reproduced as under:
It is clearly agreed and understood by the Contractor that notwithstanding anything to the contrary that may be stated in the agreement between NBCC and the contractor, the contractor shall become entitled to payment only after NBCC has received the corresponding payment(s) from the client / Owner for the work done by the contractor. Any delay in the release of payment by the client / Owner to NBCC leading to a delay in the release the corresponding payment by NBCC to the contractor shall not entitle the contractor to any compensation / interest from NBCC.
Thus, in the above clause 37.3, it is specifically mentioned that any delay in release of payment by the client/owner to the NBCC leading to a delay in the release of the corresponding payments by the NBCC to the contractor shall not entitle the contractor to any compensation/interest from NBCC. In the instant matter also, outstanding payment qua 10 th RA Bill and CS (Comm) No. 134/2023 Page 22 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd. Digitally signed by lal lal singh Date:
singh 2025.04.28 16:33:18 +0530 11th & final bill were not paid by the defendant (NBCC) to the plaintiff on the ground that corresponding payments have not been received from the client i.e. IIT Roorkee. There are several correspondences between the plaintiff and the defendant regarding the above said payments and in such correspondence between the parties, defendant categorically replied to the plaintiff that as soon as the corresponding payments will be received from the client, same will be released to the plaintiff. Further, vide reply dated 13.03.2019 Ex.PW-1/14 also, defendant replied to the plaintiff that as on date payments are still due to be received from IIT Roorkee. In the said reply dated 13.03.2019, defendant also advised to the plaintiff to bear with them.
Thus, in view of the above correspondences between the parties, it is amply clear that the defendant has not received the payments from the client i.e. IIT Roorkee. Moreover, to contradict the same, the plaintiff has also not placed any document or material on record so as to show that the defendant had received the outstanding payment in respect of 10 th RA Bill and 11th & final bill from IIT Roorkee. Otherwise also, in his cross-examination, PW-1 admitted that there was a bar on interest on delayed payments as per the contract. In these circumstances, in view of the specific clause 37.3 as well as considering the fact that payments were to be made by the defendant to the plaintiff, only after receiving the same from IIT Roorkee, the plaintiff is not entitled to pre-suit interest as claimed in the present matter.
So far as pendente lite and future interest is concerned, the plaintiff has claimed pendente lite and future interest @ 14% per annum. However, the pendente lite and future interest @14% per annum as claimed by the plaintiff appears to be very higher side and hence, considering the overall facts and circumstances of the present case, the Court is of the considered view that interest @ 9% per annum would be appropriate and CS (Comm) No. 134/2023 Page 23 of 24 M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.
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sufficient to meet the ends of justice.
20. Relief.
In view of the above discussion and findings, the plaintiff has proved its case against the defendant for recovery of Rs.1,07,96,601/-. Accordingly, the suit is decreed for sum of Rs.1,07,96,601/- in favour of the plaintiff and against the defendant, alongwith interest @ 9% per annum from the date of filing of the present suit till the realization of the amount. Plaintiff shall also be entitled to the cost.
21. Decree Sheet be drawn accordingly.
22. File be consigned to record room.
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Announced in Open (LAL SINGH)
Court on 28.04.2025 District Judge (Commercial Court-01)
South East/Saket Courts, New Delhi
MK
CS (Comm) No. 134/2023 Page 24 of 24
M/s Rama Civil India Construction Pvt. Ltd. Vs. M/s NBCC (India) Ltd.