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Delhi District Court

Brij Lal & Sons vs Delhi Development Authority on 7 January, 2008

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       IN THE COURT OF  SMT. RACHNA T. LAKHANPAL,  
                          CIVIL JUDGE  : DELHI

SUIT NO.1002/06
 
Brij Lal  & Sons,
C­97­A, Kalkaji,
New Delhi­110019.
 a partnership firm through
its partner Shri Tilak Raj

                                                                Plaintiff.
         Versus

1. Delhi Development Authority,
    through its Vice Chairman,
    Vikas Sadan, INA, New Delhi
    service to be effected through
    Executive Engineer, SWD­I/DDA.
    Vasant Kunj, New Delhi.

2. Superintending  Engineer,
   Civil Circle­I, DDA,
   Munirka, New Delhi
                                                                  Defendants.

                                         Date of institution  : 28.11.2000.
                                         Date of decision    :  07.01.2008.
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JUDGEMENT:

By this judgment, I shall dispose of the present suit of the plaintiff. In brief the case of the plaintiff is that the defendant No. 1, DDA had awarded a work contract for the development of land at Vasant Kunj Sector A vide agreement No. 148/SWD­I/DDA/88­89 with a stipulated date of start on 29.11.88 to be completed on by 28/03/99. The work was actually completed on 20.11.99 due to certain fundamental breaches committed by the defendants. However, the work has been executed and completed as per the terms of contract. Consequent upon certain disputes having arisen in between the parties, the plaintiff invoked the arbitration clause and matter was referred to the arbitrator. Due to the delay in completion of the work, certain disputes were raised by the plaintiff namely:

i Plaintiff claimed Rs.3,74,838.67 on account of final bill balance payment towards work done;

ii Plaintiff claimed refund of security deposit of Rs.7,500/­ iii Plaintiff claimed Rs.40,000/­ on account of rise in wages of labourable payable u/clause10.c.

iv Plaintiff also claimed Rs. 1 lakh on account of damages;

2. The said dispute alongwith claims of interest and costs were also referred to the Arbitrator. The defendant also preferred a counter claim namely:

"Claim of Rs.23,428/­ on account of levy of compensation under Clause 2 (EM's reference NO. EM2 (15)90/Arbn/56 dt. 19.4.91).

3. An award was made and published. The Ld. Arbitrator rejected the claim of the plaintiff entirely but allowed the counter claim of the defendants. Both the parties being aggrieved by said award challenged the award before the Hon'ble High Court. The Hon'ble High Court vide order dt. 9.4.97 was pleased to set aside the said award and remit back the claim No. 2 of the plaintiff for reconsideration. On the counter claim of the defendants the Hon'ble High Court held that:­ "The arbitrator committed an error apparent on the face of the records in allowing the claim of the respondents to the tune of Rs.23,428/­ in favour of the respondents for due deduction from the claims of the claimants from the final bill as levy of compensation, although the same is an excepted matter under Cl. 4 25 and outside the jurisdiction of the Arbitrator. Since the Arbitrator has committed an error apparent on the face of the records, in giving the aforesaid award, the said award is set aside holding the same to be the excepted matter and not within the jurisdiction of the Arbitrator to try and decide the same."

4. It is stated by the plaintiff that clause 2 of the agreement does not at all attract to the present case as the work could not be executed and completed within the stipulated contract period on account of various failures on the part of the defendant. Therefore, defendants are liable to pay a sum of Rs.80,000/­ to the plaintiffs but instead of paying to the plaintiff, after the setting aside of Arbitration award, defendant has illegally exercised its powers and arbitrarily imposed the penalty of Rs.23,428/­ on the plaintiff under clause 2 and started recovery proceedings of the said amount through their collector without any determination of the facts that the delay is attributable to whom. It is further the case of the plaintiff is that defendants instead of approaching competent court of law referred the penalty to the Asstt. Collector for recovery of said illegal penalty u/s 68 of Punjab Land Revenue Act. The collector issued a letter. Plaintiff 5 approached the officials of DDA but of no use. Ultimately plaintiff received the final writ of demand u/s 68 of Punjab Land Revenue Act dt. 24.10.00. Plaintiff has filed writ petition before the Hon'ble High Court but same was withdrawn and Hon'ble High Court observed that remedy lies before the Civil Court and not before the High Court. Hence the present suit has been filed by the plaintiff.

5. In the written statement filed by the DDA it is admitted that vide agreement work was awarded to the plaintiff. It is stated that present suit is barred by limitation. It is further stated that present suit is liable to be stayed under the provisions of arbitration and Conciliation Act. It is further stated that the present suit is bad for misjoinder of necessary parties. The present suit is hit by section 11 of the Code of Civil Procedure. It is further stated that the work was awarded to the plaintiff but it is denied that work was actually completed on 20.11.89 due to certain fundamental breaches committed by the defendants. It is stated that work was abandoned deliberately and unlawfully by the plaintiff. A show cause notice was served to the plaintiff vide letter dt. 12.5.89 and the work was rescinded vide letter dt. 20.11.89. It is denied that work has been 6 executed and competed as alleged. It is stated that the Sh. S.C. Gupta was appointed as arbitrator. It is denied that deptt. committed any breaches of contract. It is stated that as per clause 8 of the agreement the plaintiff was requested to submit their bill but the plaintiff failed to do so. All the claims were false and not tenable in law. It is stated that plaintiff failed to complete the work within stipulated time, therefore, penalty under clause 2 of the agreement was imposed by Suptt. Engineer and security deposit was forfeited. The work was abondoned by the plaintiff deliberately due to which deptt. suffered financial losses. Plaintiff was requested to accelerate the progress of the work vide letter dt.12.7.89 but to no avail. Consequently penalty of Rs.23,428/­ was imposed by the Suptt. Engineer for which he is fully empowered. The delay was only on account of lack of timely and efficient optimum arrangement of labour on behalf of plaintiff. Ld. Arbitrator has already rejected the claim of plaintiff and therefore, this court has no jurisdiction to try the claim. It is denied that defendants are liable to pay a sum of Rs.80,000/­ to the defendant. The defendants are within their right to recover the sum of Rs.23,428/­ from the plaintiff, and suit alongwith the application is liable to be dismissed.

6. In the replication all the averments made in the plaint are reiterated and those made in the written statement are denied.

7. From the pleadings of the parties, the following issues were framed :

1. Whether the notice U/s 53B of DD Act has been duly served for filing the present suit? OPD.

2. Whether the suit is barred by limitation ? OPD.

3. Whether the suit is bad for mis­joinder of necessary parties?

OPD.

4. Whether the suit is hit by the provisions of Section 11 of CPC?

OPD.

5. Whether the plaintiff is entitled for the relief of declaration as prayed for ? OPP.

6. Whether the plaintiff is entitled for the recovery of the amount along with interest as prayed for ? OPP.

7. Relief.

8. In support of his case the plaintiff has examined PW­1 Sh. Tilak Raj. Defendant DDA has examined DW­1 Sh. Narender Kumar, Junior Enginer, RPD­1/DDA.

9. I have meticulously scrutinized the entire evidence on the record and have given my careful thoughts to the rival submissions. My findings on the issues is as under :­

10. ISSUE NO. 1 - Whether the notice U/s 53B of DD Act has been duly served for filing the present suit? OPD. Onus to prove this issue was upon the defendant. Defendant has submitted that no notice was served upon the defendant U/s 53B of DD Act prior to filing of the present suit. In the present case, admittedly, litigation was going on between the plaintiff and defendant and on 14.11.2000, Hon'ble High court of Delhi in CWP No. 6814/2000 had given liberty to the plaintiff to seek remedy in the civil forum and in the writ petition as mentioned above, DDA had appeared, therefore, in view of the above background, there was no requirement of giving notice U/s 53 B of DD Act, when DDA was already aware pending litigation and appearing in all those 9 litigations in respect to same disputes. In fact, Hon'ble High Court had itself given two weeks time to the plaintiff to seek remedy in the civil forum. Therefore, obviously requirement of giving notice U/s 53B of DD Act has been dispensed with. Hence, this issue is decided in favour of the plaintiff.

11. ISSUE NO. 2 - Whether the suit is barred by limitation ? OPD.

Onus to prove this issue was upon the defendant. Plaintiff has filed the present suit for declaration and recovery. For the relief of declaration a time period has been provided by the Limitation Act i.e three years from the date of cause of action. Plaintiff has based his claim of declaration on the basis of writ of demand U/s 68 Punjab Land Revenue Act dated 29.02.2000 and 24.10.2000 and the present suit was filed on 28.11.2000. So, it can be safely inferred that the suit was within limitation in respect of prayer of declaration. As far as, relief of recovery is concerned the period of limitation started when the above said amount became due, i.e when the dispute arose in the year 1989. In the present case when the dispute arose, disputes were decided by Arbitrator and arbitrator's award was upheld by the Hon'ble High court except the claim of DDA. The suit has been 10 filed in the year 2000, hence, the relief of recovery is clearly barred by limitation. This issue is partially decided in favour of the defendant.

12. ISSUE NO. 3 ­ Whether the suit is bad for mis­joinder of necessary parties? OPD.

Onus to prove this issue was upon the defendant.

Plaintiff has impleaded Superintending Engineer in the array of the parties. In the present case Superintending Engineer had given notice of recovery and plaintiff has impleaded Superintending Engineer in the official capacity. Therefore, it can not be said that the suit is bad for mis­joinder of necessary parties. Hence, this issue has been decided against the defendant.

13. ISSUE NO. 4 : Whether the suit is hit by the provisions of Section 11 of CPC ? OPD.

Onus to prove this issue was upon the defendant. Admittedly, plaintiff had challenged the award and Hon'ble High Court of Delhi in Suit No. 391/1994, in its order dated 09.04.1997, in the matter between plaintiff and defendant has held that Clause 2 of the 11 agreement is an excepted matter under Clause 25 and therefore, outside the jurisdiction of the arbitrator and the award was set aside only in respect of the counter claim of DDA before Arbitrator. The relevant para is being reproduced as hereunder.

"The counsel admits that the provisions of Clause 2 are excepted matter under Clause 25 and, therefore, outside the jurisdiction of the Arbitrator. Thus, the Arbitrator committed an error apparent on the face of the records in allowing the claim of the respondents to the tune of Rs. 23,428/­, in favour of the respondents for due deduction from the claims of the claimants from the final bill as levy of compensation, although the same is an excepted matter under Clause 25 and outside the jurisdiction of the Arbitrator. Since the arbitrator has committed an error apparent on the face of t he records in giving the aforesaid award, the said award is set aside holding the same to be an excepted matter and not within the jurisdiction of the Arbitrator and decide the same. The objection filed by the petitioner stands allowed to the extent indicated above. Both the suits and the objections stand disposed of in the aforesaid terms. Since by this order, I am remitting back claim No. 2 of the petitioner to the Arbitrator for re­consideration." 12

14. After having considering the order of Hon'ble High Court it is evident that award was set aside only in respect to claim of DDA and meaning thereby rest of the award was upheld. Defendant has relied upon the award and of the arbitrator in which plaintiff has asked for the recovery on account of rise in labour charges etc. and in the present suit also plaintiff has sought recovery under the head of labour charges etc. A bare reading of award reflects that this issue has been dealt with by the arbitrator and when this arbitrator award was challenged before Hon'ble High Court then the award only with respect to the counter claim of DDA was set aside and rest of the award was upheld. Moreover, in his cross examination also plaintiff has deposed that arbitration agreement was entered between the plaintiff and defendant and admitted that Arbitrator had passed award after hearing him and perusing all the documents and made award in respect of the dispute referred by the plaintiff. He has also admitted that the dispute pending under the present suit was also included in the claim filed by him before the Ld. Arbitrator and was rejected by the Ld. Arbitrator except the claim No. 1 for a sum of Rs. 5000/­ which was 13 awarded by the Ld. Arbitrator. He has also admitted that he had filed objections against the award in the Hon'ble High court of Delhi and Hon'ble High Court of Delhi only referred back his claim No. 2 for fresh adjudication.

15. Further more, a bare perusal of the plaint reflects that plaintiff seeks recovery of Rs. 80,000/­ for incurring additional expenditure for quantum of work executed after the expiry of stipulated contract period on account of establishment labour, P & T and rise in price. And a bare perusal of the arbitrator award reflects that this amount was claimed under this head of additional expenditure by the plaintiff and rejected by the Ld. Arbitrator and later on his award was upheld. Therefore, plaintiff can not reagitate this issue before this Court in the garb of Hon'ble High Court's order. In the order of Hon'ble High Court dated 14.11.2000 in CWP No. 6814/2000 also, it has been mentioned by the Hon'ble Justice Man Mohan Sareen, that award was set aside only in respect of counter claim of DDA. Therefore, the prayer of the plaintiff regarding decree of recovery is barred by res­judicata. Therefore, this issue is decided in favour of the defendant.

16. ISSUE NO. 5 ­ Whether the plaintiff is entitled for the relief of declaration as prayed for ? OPP.

Onus to prove this issue was upon the plaintiff. Plaintiff has alleged that delay in contract was attributable to the DDA as the department did not supply the material regularly in confirmity with the actual requirement at site and therefore, the contract was delayed from its stipulated period and could be completed on 20.11.89. Admittedly, DDA has asked recovery of Rs. 23,428/­ as penalty under clause 2 of the agreement. It is also admitted that DDA had already claimed this penalty before the Ld. Arbitrator as counter claim but Hon'ble High Court has set aside the award with respect to the counter claim. Therefore, DDA claimed recovery of above said penalty under Punjab Land Revenue Act. Plaintiff has not led any evidence to show that the delay was caused due to any inaction of the department. He has not proved any document or letters. Plaintiff had filed various letters written to DDA, but same were struck off from the affidavit of evidence vide order dated 06.09.2005. Plaintiff, thereafter, neither challenged the order nor moved any appropriate application. Counsel for the defendant also, 15 therefore, did not cross examine the plaintiff on those letter. Hence, it can be concluded that plaintiff could not prove that delay was attributable to the DDA and further could not prove that penalty imposed upon plaintiff was illegal and non est. Hence, it can be safely inferred that the plaintiff has not discharged his onus and therefore, not entitled to the relief sought. Accordingly, this issue is decided against the plaintiff.

17. ISSUE NO. 6 - Whether the plaintiff is entitled for the recovery of the amount along with interest as prayed for ?OPP.

In view of the findings in issue no. 2 and 4, plaintiff is not entitled for recovery of the amount along with interest. This issue is also decided against the plaintiff.

18. ISSUE NO. 7 (RELIEF) :

In view of the findings in issue no. 2, 4, 5 and 6, plaintiff is not entitled to any relief. Suit of the plaintiff is dismissed. Parties shall bear their own costs. Decree sheet be prepared accordingly. File be consigned to record room.

(RACHNA T. LAKHANPAL) CIVIL JUDGE/DELHI.

ANNOUNCED IN OPEN COURT 16 ON 07.01.2008.