Delhi District Court
In Re vs Shri Onkar Singh Pasricha on 3 December, 2018
IN THE COURT OF SH. HARISH KUMAR : ADDITIONAL DISTRICT
JUDGE -13 : CENTRAL DISTRICT : TIS HAZARI COURT : DELHI
CS No. 609875/16
In Re:-
M/s Bhargava & Associates Pvt. Ltd.
9, Siri Fort Road, New Delhi - 110019
(Through its Managing Director,
Shri S.C. Bhargava) .......................Plaintiff
VERSUS
1. Shri Onkar Singh Pasricha
2. Shri A. S. Pasricha
Both S/o Sh. Narender Singh Pasricha
3. M/s T.C.N.S.
All at 3, Community Centre, Saket,
New Delhi - 110017
4. M/s Impressions International
953-956, Gali No. 4,
Naiwala, Karol Bagh,
New Delhi - 110005 ........Defendants
SUIT FOR RECOVERY OF Rs. 16,00,000/-
AND
COUNTER CLAIM FOR Rs. 20,00,000/-
Date of institution of present suit : 05.05.1994
Date of Counter claim : 31.05.1995
Date of Judgment : 03.12.2018
JUDGEMENT
This judgement shall dispose of suit filed by plaintiff for recovery of Rs 16 lacs against the defendants and Counter Claim filed by defendants No.1 to 3 against the plaintiff for recovery of Rs 20,00,000/-.
Case of the plaintiff
1. The plaintiff instituted the present suit for recovery of Rs.16,00,000/- against the defendants alleging that plaintiff M/s Bhargava and CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 1 of 37 Associates Pvt. Ltd. is incorporated under the Companies Act and Sh. S.C. Bhargava who is an architect is also the Promoter and managing Director of the aforesaid plaintiff company. The plaintiff company is engaged in the business of development consultants and architects. Sh. S.C. Bhargava being the Principal Officer of the plaintiff company is authorised by the Board of the plaintiff company to sign and verify the plaint.
2. The plaintiff has impleaded four defendants. Defendant No. 1 and defendant No. 2 are real brothers They owned properties in their own name and their businesses names impleaded as defendant No. 3 i.e. M/s TCNS and defendant No. 4 M/s Impression International. The defendant No. 1 and 2 represented such business in their transaction with plaintiff. However, legal constitution of defendants No. 3 and 4 is not within the knowledge of the plaintiff.
3. As per the plaintiff, the defendants availed the services of the plaintiff company for the following properties:-
1. Farm House property situate at Sultanpur (Khasra No. 641, 642, 645 and 677), New Delhi. (hereinafter referred to as farm house land at Sultanpur)
2. House Property called W-155, Greater Kailash, Part II, New Delhi. (hereinafter referred to as house property situated at Greater Kailash)
3. Factory Property proposed to be acquired/purchased known as A-
23, Okhla Industrial Area, Phase I, New Delhi. (hereinafter referred to as factory property situated at Okhla Industrial Area)
4. Factory Property commonly referred as TCNS Factory situate in khasra No. 522 and 522/1 at Jaunpur, New Delhi.
5. Factory Property commonly referred as M/s Impressions International situated in khasra No. 522 and 522/1 at Jaunpur, New Delhi.
CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 2 of 37
4. The plaintiff has averred that defendants No. 1 and 2 negotiated for availing services of the plaintiff for aforesaid properties. The fees so settled was payable by defendants No. 1 and 2 for and on behalf of defendants in the suit. Such defendants also made part payments from time to time.
5. In August, 1990 defendants No. 1 and 2 engaged the services of plaintiff as architects/consultants for development of their farm house land at Sultanpur as noted above. The defendants desired to have provision of three (two bed room suites) with common living, dining, lounging area with amenities, suitable to accommodate three families, with out-houses consisting of three servant quarters with attached toilets. They desired to develop a swimming pool as well as squash court with change rooms, and the area to be landscaped. The plaintiff was asked to design, prepare all architectural plans, structural plans, electricity-sanitary plans, landscape plans and to work out completely the drainage and water system at aforesaid farm house so as to make the facilities self contained in all respects. Defendants No. 1 and 2 settled the consultancy charges towards the aforesaid project in lumpsum at Rs.3,00,000/-.
6. The plaintiff in pursuance of consultancy charges so agreed prepared drawings for defendants which included sketch design which included two alternative plans each for ground floor and first floor and one lay out plan, seven proposed design for different floor, elevation section etc, and 13 landscape design for all aspect. Besides consultancy charges as agreed at Rs.3,00,000/- the defendants also agreed to reimburse salary of one supervisor deployed by plaintiff at site at the rate of Rs.2,000/- per month during execution stage of the project.
7. In pursuance thereof, the plaintiff invited quotations/offers from contractors for execution of the project. The plaintiff processed them in CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 3 of 37 consultation with the defendants and finalized the same. Plaintiff also submitted plans for sanction with concerned authorities, however, during the month of April-May, June 1991, the defendants after having all works performed by the plaintiff desired to abandoned the project and finally during October, 1992 discussions, abandoned the same.
8. It is further averred by the plaintiff that in November, 1990, defendants No. 1 and 2 desired plaintiff to accept architectural assignment for their proposed renovation work involved in their house property W-155 situated at Greater Kailash-II. For this project the defendants settled plaintiff's fee/consultancy charges at 15% of value of works undertaken or executed, under plaintiff's guidance/control. Defendants desired additions/alterations besides typical changes in the said property, list of which has been mentioned in details in paragraph 9 of the plaint.
9. The plaintiff prepared drawings from time to time, incorporating the amendments, suggestions stated by such defendants and their family members and finalized 48 drawings for almost all part and feature of the aforesaid house property of the defendants. In consultation with the defendants, the plaintiff identified the contractors, who completed works under supervision/guidance of the plaintiff. The renovation project costed to Rs. 36,00,000/- to the plaintiff, which they paid to the contractors deputed. All the works were duly completed in the aforesaid property and the defendants occupied the renovated house on 13.04.1992.
10. In November 1991, defendants engaged services of plaintiff for rendering architectural advice to the defendants on the scope of services as should be provided in the factory property situated at A-23, Okhla Industrial Area as the said property at that time was under construction and the defendants desired to purchase the same for their businesses. The plaintiff was required to advise the defendants on construction drawings and other CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 4 of 37 architectural advice keeping in view the particular requirements and nature of work of the defendants. In pursuance thereof the plaintiff visited the site of under construction factory situated at A-23, Okhla Industrial Area and apprised the defendants with construction drawings and architectural advice. For the aforesaid project the defendants settled plaintiff's fee/service charges at Rs. 4 Lacs. Plaintiff took steps to study plan for existing factory with a view to understand technically scheme and to cater for the needs of the defendants prior to the purchase of aforesaid property. Accordingly, plaintiff prepared flow plans and discussed and finalized specifications with the builder for the purchase of aforesaid property. However, defendants deals/ transactions for aforesaid property did not materialize and execution of project was abandoned. The plaintiff submitted bills of Rs.1,00,000/- against their finalized bill of Rs. 4,00,000/-, for the whole project, to the defendants, for the services rendered by the plaintiff with respect to the factory property situated at Okhla Industrial Area.
11. In February 1992 defendants engaged the services of the plaintiff for the factory of respective defendants 3 and 4 situate on land comprised in khasra No. 522 and 522/1 at Jaunpur. The services of plaintiff included architectural design, structural design, landscape, electrification and plumbing and other activities involved in security, fire fighting, drainage, savage, provision of mechanical hoist etc. of the aforesaid property. The plaintiff's fee for aforesaid services was settled at 10% of the project cost. For convenience defendants desired plaintiff to bifurcate its billing in the name of defendants No. 3 and 4 at lumpsum agreed fee. The defendants agreed to pay Rs.1.00 lakh for Rs.10.00 lakhs cost in account of defendants No. 3 and Rs. 4.00 lakhs in account of defendant No. 4, if project cost remains below Rs. 50.00 lakhs. The defendants desired plaintiff to prepare tendered documents and contract documents for inviting contracts on lumpsum basis stating specifications of work to be done in the tender documents. Plaintiff prepared complete drawings, tender invitation documents, scrutinized the quotations received CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 5 of 37 from tenderer and submitted report for appointment of contractors This exercise consumed around 45 days of complete working with defendants for defendants' aforesaid project. Thereafter, defendants desired plaintiff to prepare tender documents, scrutinized the quotations and finalized contracts with construction agencies, by obtaining quotations on item rate basis also. On the basis of quotations received project cost was evaluated at around Rs.72,00,000/-. After finalization of above contracts based on defendants desire and increased quantum of work, plaintiff prepared fresh designs and drawings as per requirements of defendants given in their meeting from time to time.
12. The plaintiff has claimed in the plaint the following bills from the defendant for the aforesaid projects:-
S.No. Project Project Fee Chargeable Amount
Cost
1. Farm House at Sultanpur, lumpsum fee 3,00,000/-
Mehrauli
2. W-115, Greater Kailash,
Part II, New Delhi (house) 36,00,000/- 15% 5,40,000/-
3. Proposed factory at
A-23, Okhla Phase-I,
New Delhi lumpsum fee 1,00,000/-
4. Factory at Jaunpur,
Mehrauli, New Delhi 75,00,000/- 10% 7,50,000/-
_________
Total: 16,90,000/-
13. As per the claim of the plaintiff in the plaint a total of Rs.16,90,000/- was due from the defendants. However, against the above bills defendants paid a net fee for all the projects at Rs.1,92,500/-. Hence, after taking into account the amount of money already paid by the defendants a sum of Rs.14,97,500/- remained payable by the defendants to the plaintiff. It is averred by the plaintiff that the plaintiff completed all work on his own expenses for execution of aforesaid projects. Defendants opted not to proceed with their projects for reasons originating at their end. Plaintiff requested and CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 6 of 37 reminded defendants to settle the pending bills, however, defendants did not response to it until meeting took place between the parties on 21.04.1993 wherein defendants obtained complete record of works done by the plaintiff including their account of expenses incurred in the aforesaid projects. Thereafter, defendants neither responded nor took steps to discharge their liability in terms of the aforesaid bills. Said balance pending bill amount is legally recoverable by the plaintiff and payable by aforesaid defendant jointly and severally. The plaintiff is also entitled to recover interest on aforesaid sums at the rate of 21% per annum. Plaintiff limits claims on account of interest at aforesaid sum up to the date of filing of the suit at Rs.1,20,500/-. Thus, plaintiff is entitled to amount of Rs.16,00,000/- from defendants. Hence the present suit.
Case of the defendants
14. Defendants No.4 did not contest the suit. Defendants No.1, 2 and 3 filed common written statement-cum-counter claim to the plaint filed by the plaintiff. At the outset the defendants have denied that they have any concern with defendant No. 4. They have admitted that defendants No. 1 and 2 are brothers but have submitted that defendants No. 3 and 4 are separate and distinct legal entities being partnership firm. Defendants No. 1 and 2 are two of the four partners in defendant No. 3, however, they have no concern with defendant No. 4. The allegations of the plaintiff that defendants No. 1 and 2 made any representation to the plaintiff company or Sh. S.C. Bhargava regarding business of defendants No. 3 and 4 or that they were their businesses names has been denied.
15. The agricultural land situated at village Sultanpur stand in the name of defendant No. 1. The residential property at Greater Kailash is partly owned by defendant No. 1. The answering defendants do not own any factory or property at Okhla Industrial Area. There is no factory premises in khasra No. 522 and 522/1, Jaunpur. There are two plots of land. Plot No. 522/1, min. is owned by defendant No. 4 and is partnership firm with which the answering CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 7 of 37 defendants have no concern while plot No. 522 min. is owned by defendants No. 3 of which the answering defendants are two out of four partners It is specifically denied by the defendants that fees/charges were settled between the plaintiff and the answering defendants for the alleged services. Plaintiff always maintained that he would charge a fee representing a percentage of the total overall costs of any building project undertaken by him. The fees would, therefore, be worked out after all the works had been assigned to the concerned contractors and the contracts executed. It is averred by the answering defendants that the answering defendants make several payments including advance payment on the basis of the false and fraudulent representations and assurances of Sh. S.C. Bhargava and for which no work was carried out.
16. In or about July-August, 1990 when defendant No. 1 was contemplating building residential premises on agricultural land owned by him, he was approached by Sh. S.C. Bhargava, who held himself out to be an architect of repute and assured him that he would obtain sanctions and permission for building three bed room suites with separate living, dining and lounging areas and all necessary amenities including out-houses and servant quarters after ensuring due compliance with and obtaining all permissions under the applicable building bye-laws. Sh. S.C. Bhargava followed up with a letter dated 21.08.1990, and was very profuse in asserting that he was capable of following up and taking care of all the requirements for building residential units of the specifications detailed above. He wanted initial payment for plans and what he preferred to call 'follow up action'.
17. Knowing fully well that no such residential unit could be made in the agricultural plot, and playing upon the ignorance of defendants No. 1, Sh. S.C. Bhargava asked to be paid a sum of Rs.1,20,000/- with a further sum of Rs.1,50,000/- for the so called 'follow up' action as detailed in the statement of account in the written statement. The answering defendants paid him a sum of Rs. 2,70,000/- for this purpose. Even while submitting the plans which were CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 8 of 37 not in accordance with the building bye-laws, Sh. S.C. Bhargava deliberately avoided furnishing necessary documents and complying with all the formalities as required by the Municipal and concerned authorities. When notices were received from the MCD to fulfill the technical formalities for sanctioning of plans, which notice was forwarded to Sh. S.C. Bhargava, however, he deliberately failed to follow up the entire process.
18. Accordingly, the plans were rejected for non compliance of formalities hence Sh. S.C. Bhargava illegally enriched himself to the extent of Rs. 2,70,000/-. Thereafter, he on his own started calling for tenderers from his own for the proposed construction, and there was no justification for doing so. The record of the Municipal Corporation would show that qualified architects filed plans which were absolutely contrary to the bye laws/rules and they also did not file other documents and failed to follow up the entire process for obtaining the requisite sanctions for building a house on these agricultural lands. It is further averred by the defendant that till date defendant No. 1 has not been able to make any headway in the matter of constructing his farm house because once the layout plans are rejected, as a matter of general practice, no fresh plans are entertained in this behalf by the Municipal Corporation of Delhi for a period of three years. from the date of rejection. It is specifically denied by the defendant that a lumpsum charges of Rs.3,00,000/- were settled or payable to the plaintiff towards the salary of Supervisor who was employed by the plaintiff. There is no such drawings or layouts was asked by the defendants to be prepared by the plaintiff. If any drawings and layouts have been prepared then it is out of plaintiff's own volition.
19. It is asserted by the answering defendants that they had cursorily talked to the plaintiff with respect to renovation of the residential property situated at Greater Kailash without so much as asking for any specific suggestions from the answering defendant and Sh. S.C. Bhargava began by giving the impression that he was only trying to help them out in the routine CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 9 of 37 renovation of the property. The team of workers sent by Sh. S.C. Bhargava for the renovation subsequently declined to complete the work. The answering defendants ultimately were compelled to employ another set of architects and builders by the name M/s MAC Constructions for completing the renovation work and spent total sum of Rs. 2,75,000/- on the said renovation. It is categorically denied that the renovation work costed Rs. 36,00,000/- to the plaintiff and that the plaintiff can make any claim towards consultancy charges as made out in the plaint.
20. The defendants have averred in the written statement that the factory property situated at Okhla Industrial Area do not belong to any of answering defendants, however, they were at one time contemplating its acquisition, therefore, Sh. S.C. Bhargava had no occasion to have made any such plans as he never visited the site, he could not have executed any such plans for constructing the factory in the said property which never belonged to the answering defendants.
21. The defendants have denied the averments made by the plaintiff in the plaint with respect to the lands comprised in the plots in village Jaunpur. It is stated that the said plots are situated in 'lal dora' of village Jaunpur, Delhi. Sh. S.C. Bhargava had given the impression that no sanction of any of the authority is required for construction in the extended 'lal dora' in accordance with the existing bye-laws as applicable to the Union Territory of Delhi. No plans were submitted by Sh. S.C. Bhargava to the MCD and no approval of any concerned authority was sought to be obtained. No such factory had been constructed till date, infact the project had to be abandoned as the same was not feasible. Subsequently, a part of the land in khasra number 522/1 min. had also to be sold of because it could not be utilized immediately.
22. Sh. S.C. Bhargava had no occasion to send any bills to the answering defendants as no projects either for building a residential house on CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 10 of 37 the agricultural land or the factory facility at Jaunpur matured to have given any justification to him to claim any money from the answering defendants as alleged. Further, the answering defendants had no occasion to make any contract regarding property belonging to partnership firms. It is categorically affirmed that the sums detailed in the plaint being the amounts received by cheque/cash are not the accurate figures. The amount received by Sh. S.C. Bhargava in all from the answering defendants was Rs.4,78,000/-, which the plaintiff is liable to refund and also to pay other claims made by the answering defendant in their counter claim.
23. On the basis of the specific denials made by the defendant and also the averments made in the written statement the defendants have prayed that the plaintiff's suit be dismissed with cost.
Counter Claim
24. While denying the claim of the plaintiff in the suit for recovery of Rs.16.00 lakhs, the answering defendants have also filed the present counter claim against the plaintiff. The defendants have reiterated their stand stated in the written statement and at the same time has raised certain additional pleas.
25. It is the claim of the defendant that apart from refunding a sum of Rs. 2,70,000/- with respect to the farm house property situate at Sultanpur as claimed in the written statement from the answering defendants the plaintiff is also liable to pay liquidated damages which have accrued as a result of steep escalation of prices for such constructions. Qua the estimate of construction as they stood in 1991, the current costs at least 50% increased is envisaged and in respect of small farm house, strictly within the rules, the answering defendants stand to spend over Rs. 5,00,000/- in the escalated mark up cost of construction alone which they are entitled to recover from the plaintiff.
26. In the matter of lands owned by defendant No. 3 in 'lal dora' area CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 11 of 37 of village Jaunpur, Sh. S.C. Bhargava had invited tenderers to engage competent contractors, however, because of serious defects in the tender itself the rates and the terms of the tender could not be fixed. Apart from such defect Sh. S.C. Bhargava had also not applied for any permission for erecting a commercial facility in the extended "lal dora' area of village Jaunpur. Consequently, the entire project was abandoned. Since then there has been tremendous increase in the cost of construction because of which defendants have been precluded from setting up their manufacturing facility. It is because of the failure of Sh. S.C. Bhargava to carry out his obligations and render services as required, the plaintiff will have to pay a minimum difference in the cost of construction alone of about Rs.7.5 lakhs. Apart from the aforesaid the defendants are entitled to recover all sums of money paid by them to Sh. S.C. Bhargava. However, the answering defendants have confined their claim for recovery for Rs. 4,78,000/-.
27. The defendants are also entitled to recover sum paid to M/s MAC Constructions for completing the renovation work at the property situated at Greater Kailash amounting to Rs. 2.75 lakhs. Apart from aforesaid amount, the answering defendants are entitled to a claim of Rs. 5.00 lakhs towards harassment and liquidated damages.
28. Hence, by way of this counter claim the answering defendants are claiming following sums from the plaintiff:-
1. Refund of the amount paid to Sh. S. C. Bhargava Rs.4,78,000.00
2. On account of escalation in the cost of construction at the residential house on the agricultural lands at village Sultanpur, Delhi and at village Jaunpur Rs.10,00,000.00
3. Amount paid M/s MAC Constructions Co. to complete the renovation work at the residential house Rs. 2,75,000.00
4. Towards liquidated damages Rs. 2,33,000.00 Total amount claimed Rs. 20,00,000.00 CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 12 of 37
29. By way of written statement-cum-counter claim, the answering defendants have prayed that the suit of the plaintiff be dismissed with costs, and a decree for Rs.20,00,000/- together with interest pendente-lite and future @ 24% per annum be passed in favour of the answering defendants and against the plaintiff.
Replication-cum-written statement to the written statement-cum-Counter claim
30. Replication-cum-written statement was filed on behalf of the plaintiff to the written statement-cum-counter claim filed by the defendants No. 1, 2 and 3. The plaintiff has reiterated the facts averred in the plaint and has specifically denied the averments made in the written statement-cum-written statement by the defendants, which is not repeated herein for the sake of brevity. In response to counter claim plaintiff at the outset has stated that in view of the position stated in the plaint filed by the plaintiff in the present suit and the submissions made in the aforesaid replication, the claim framed by the defendants merits rejection with special costs. The plaintiff has specifically denied the averments made by the defendants in the counter claim.
Issues
31. Although technically counter claim should have been registered separately but it was not done so in the Hon'ble High Court and therefore it was also not done so at the District Court level when matter was transfered due to enhancement of pecuniary jurisdiction of the District Court. Be that as it may, following issues were framed from the pleadings of the parties on 01.02.1999 by the Hon'ble High Court when matter was pending before the Hon'ble high Court:-
Whether the suit is bad for mis-joinder of the parties? OPD Whether there was any contrast of service entered into between the plaintiff and the defendants? If so, its effect? Onus on parties.
Whether the services of the plaintiff were engaged by the CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 13 of 37 defendants, as alleged? OPP Whether the plaintiff is entitled to the amount claimed in the suit and, if so, for what amount? OPP Whether the plaintiff is also entitled to the interest for the aforesaid amount and, if so, at what rate and for which period?
Whether the defendants are entitled to any relief on their counter- claim and, if so, for what amount?
If the aforesaid issue is answered in favour of the defendants, whether the defendants are entitled to interest and, if so, at what rate and for which period?
Relief, if any.
Evidence
32. Plaintiff examined its Managing Director Shri S. C. Bharagva who filed his affidavit in examination-in-chief Ex PW1/A relying upon documents exhibited as Ex PW1 to Ex PW1/62 (colly) including various drawings, letters written by plaintiff, running bills etc. details thereof has been discussed while dealing with issues. Plaintiff further examined PW2 Sarup Singh who had participated in tender floated by the plaintiff for the purpose of execution work at factory site at Jaunpur. Plaintiff further examined Sh. P. C. Paul as PW3 who was working as Accountant with plaintiff.
33. Defendants No. 1 to 3 examined defendant No.1 as DW1 who filed his affidavit Ex DW1/A in examination-in-chief relying upon letter dt 21.08.1990 Ex DW1, letter/notices received from MCD Ex. D-3 to Ex D-5.
Defendants No.1 to 3 further examined Shri Prahlad Singh as DW2 who stated to have worked with M/s Mac Construction Co. the contractor who allegedly completed the renovation work left by plaintiff at W-155, G.K.-II.
Findings
34. After going through the pleadings, evidence material on record CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 14 of 37 and after appreciating arguments of the Counsel for parties, issue wise findings are as under: -
ISSUE No.1 :- Whether the suit is bad for mis-joinder of the parties? OPD
35. Onus to prove this issue is upon the defendants. Defendant No.4 has not contested the present suit. Defendants No. 1 and 2 have claimed to be two of the four partners of defendant No.3 and have denied any concern with defendant No.4. DW1 Sh. Onkar Singh Pasricha in his cross examination deposed that he made the payments through cheques to the plaintiff drawn by defendant No. 3 TCNS and defendant No.4 Impressions International but he did not remember whether cheque issued from Impression International accounts' was signed by him or not. It is the specific case of the defendant No.1, 2 and 3 that they did not have any concern with defendant no.4 then it was for the defendant to explain how cheque was issued from the account of defendant No.4 for payment to the plaintiff. Further when Defendant No.1 and 2 had no concern with defendant No.4 there was no occasion for DW1 to be unsure if the cheque issued from the account of defendant No. 4 was signed by him or not. More at the stage of admission- denial of documents defendant themselves put for admission letter of acceptance written to defendant No.4 which was admitted on behalf of plaintiff and was exhibited as Ex D-7. Defendants have not explained how this letter came to them and for what purpose they have put the same before plaintiff for admission, if they had no concern with defendant No.4. In this circumstance it was for the contesting defendants to satisfy the Court that suit was bad for mis-joinder of the defendant No.4. Plaintiff has categorically pleaded that defendant No.1 and 2 were representing the defendant No. 3 and 4 in their dealing with plaintiff. Nothing has come on record after the admission of the DW1 himself that cheque was issued by him from the account of defendant No. 4 for payment of the plaintiff, to show that impleadment of defendant No. 4 was not necessary or that defendants No. 1 to 3 have no concern with defendant No.4. Hence, in this circumstance issue No.1 is decided against the defendants and in favour of the CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 15 of 37 plaintiff.
ISSUE No.2 :- Whether there was any contract of service entered into between the plaintiff and the defendants? If so, its effect? Onus on parties.
ISSUE No.3 :- Whether the services of the plaintiff were engaged by the defendants, as alleged? OPP
36. Both issues are taken up together as they require appreciation of same facts and evidence. Onus to prove issue No. 2 is upon parties meaning thereby that plaintiff has to prove that there was contract of service between the plaintiff and defendants whereas defendants have to prove that there was no contract of service between the plaintiff and defendants. However, onus to prove issue No.3 is upon the plaintiff.
37. It is the pleading of the plaintiff that defendants No. 1 and 2 in all assigned one after another four projects to the plaintiff which included one farm house at Sultanpur, renovation work at house of defendants at Greater Kailash, factory at Okhla Industrial Area which defendants intended to acquire and factory projects on land bearing No. 522 and 522/1 min at Jaunpur. In the written statement contesting defendants have not categorically denied plaintiff's involvement in the projects intended to be brought in place at Sultanpur, Greater Kailash and at Juanpur but it has been cleverly projected that plaintiff intruded in these projects. So far as factory at Okhla Industrial Area is concerned admittedly it is the case of the plaintiff itself that said factory defendants were intending to purchase but the deal did not materialize. Contesting defendants in the pleading itself admitted that they were intending to purchase the said factory at Okhla Industrial Area.
38. DW1 in his cross examination categorically deposed that he assigned the project at Sultanpur to the plaintiff in the year 1990 or so. He further deposed that somewhere in the year 1992-93 he had assigned the second assignment of factory at Jaunpur. He further deposed that Jaunpur CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 16 of 37 project was the third assignment and the renovation at W-155 G.K-II was the second assignment to the plaintiff which in fact was not agreed to be assigned by him to the plaintiff.
39. In the written statement contesting defendant have pleaded with respect to assignment for renovation at W-155 G.K.-II that Mr. S. C. Bhargava began by giving the impression that he was only trying to help them out in the routine renovation of the property situate in an area of about 415 sq. yds. It has been further pleaded that team of workers sent by Sh. S. C. Bhargava for the renovations subsequently declined to complete the work and answering defendants ultimately were compelled to employ another set of architects and builders by the name of M/s Mac Construction Co. and spent a total of Rs. 2,75,000/- on the said renovation. Defendants failed to prove that plaintiff's services were not engaged in respect of above three projects. Even if plaintiff intruded itself in all these projects as pleaded by the defendants, nothing has come on record that any effort was made by the defendants to stop the plaintiff from proceeding further. Thus, from the pleading and testimony of DW1 engagement of service of the plaintiff to the three projects stands proved.
40. So far as services concerning A-23, Okhla Industrial Area is concerned, contesting defendants have categorically denied to have availed services of the plaintiff for any purpose. However, a suggestion was given to PW1 Sh. S. C. Bhargava to the effect that plaintiff has raised demand without any rhyme or reason merely because the matter may have been discussed by chance. In any case, plaintiff is required to prove by cogent evidence that it's services were engaged by the contesting defendants qua A-23, Okhla Industrial Area. Plaintiff in his evidence relied upon the letter dt 11.11.1991 Ex PW1/74 written by plaintiff to the defendant with regard to the above project and has also relied upon letter-cum-bill dt 29.01.1993 Ex PW1/75 along with list of design Ex PW1/76, to prove that project at A-23, Okhla Industrial Area was assigned to him. Apart from these self serving letters and list of design CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 17 of 37 exhibited as Ex PW1/74 to Ex PW1/76, there is no other material on record to suggest that its services were engaged by the defendants. Thus, plaintiff has failed to prove that its services were engaged by the defendants for A-23, Okhla Industrial Area, New Delhi.
41. It is not the case of either party that plaintiff was to render services gratuitously. Then under normal circumstance it can be presumed that plaintiff must have agreed to render its services and defendant must have agreed to pay for it. Thus, there was contract of service between the plaintiff and defendant No.1 and 2 with respect to three projects as discussed above. Hence, both issues are decided in favour of the plaintiff and against the defendants.
ISSUE No.4 :-Whether the plaintiff is entitled to the amount claimed in the suit and, if so, for what amount? OPP
42. Onus to prove this issue is upon the plaintiff. Plaintiff has claimed Rs. 16,00,000/- which includes balance bill amount of Rs. 14,97,500/- and Rs. 1,92,500/- towards interest. It is the case of the plaintiff that in respect of project of farm house at Sultanpur, fees was fixed at Rs. 3,00,000/-, in respect of renovation work at W-155, G.K-11 fee was fixed at 15% of the cost of project i.e. 15% of Rs. 36,00,000/- i.e. Rs. 5,40,000/-, in respect of A-23, Okhla Industrial Area plaintiff has claimed only Rs. 1,00,000/- in lieu of fixed fees of Rs. 4,00,000/- as the deal did not materliase and in respect of the factory projects fees was fixed at 10% of the cost of project which was expected to cost Rs. 75,00,000/- i.e. 7,50,000/-. It is the case of the plaintiff that out of Rs. 16,90,000/- plaintiff has been paid only Rs. 1,92,500/- therefore, plaintiff is entitled for the balance bill amount of Rs. 14,97,500/- apart from interest.
43. It has been seen above that plaintiff has failed to prove that there was any contract of service between the plaintiff and defendant in respect of A-
CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 18 of 37 23, Okhla Industrial Area. Therefore, plaintiff is certainly not entitled to the amount of Rs. 1,00,000/- as claimed.
44. In respect of the farm house projects at Sultanpur plaintiff wrote letter of acceptance dt.21.08.1990 Ex PW1/2 also exhibited as P-6 which is a admitted document. As per this document a lum-sum fees of Rs. 3,00,000/- was fixed for providing all kind of consultancy connected with the said project and drawn in the following mode:-
Drawing Stage:-
1. Advance : Rs.40,000/-
2. On submission of plans for approval : Rs. 40,000/-
3. On completion of drawings as necessary : Rs. 40,000/-
for award of work Construction Stage:-
1. On filling foundation : Rs. 30,000/-
2. On laying Basement floor roof : Rs. 30,000/-
3. On laying Ground floor roof : Rs. 30,000/-
4. On plaster commencement : Rs. 30,000/-
5. On laying floors : Rs. 30,000/-
6. Final payment on completion of work : Rs. 30,000/-
45. As per this letter, plaintiff was not only to design all sorts of plans but were also to get them approved from the Corporation including follows up. Apart from this plaintiff, plaintiff was also to prepare specifications and drawing relating to the work and award the work to an agency to execute the projects. Further after the contracts are awarded and work is commenced plaintiff was to supervise the work periodically to ensure that its designs, ideas, specifications of construction were implemented and maintained at the site.
46. Admittedly, construction stage did not come as Municipal Authority did not approve of the site plan for construction. Perusal of Ex PW1/2 @ Ex. P-6 reveals that there is no agreement between the parties that defendants would have to pay the entire fees even if construction did not start for any reason at defendants' end. Parties have traded charges against each CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 19 of 37 other that it was the other party at whose fault site plans/designs were not sanctioned/approved by the Corporation. Such allegation is of no bearings so far as plaintiff's claim is concerned in view of lack of stipulation that entire fees has to be paid even if construction is not carried out.
47. Once plaintiff has not rendered the services connected with various stages as stipulated in the headings "Construction Stage" there is no question of plaintiff being entitled to claim fees for those services. Similarly third stage of drawing stage also did not come as plans were not approved by the Corporation. Therefore, plaintiff cannot claim fees for that stage also. It is also worthwhile to note that fees settled was for "all kind of consultancy connected with the project". It was not only for drawings but for "all kind of consultancy connected with the project". But the occasion for other stages of consultancy did not come as the projects got stuck with submission of drawings for approval with Corporation. In this circumstance plaintiff is only entitled to fees for drawings and "follow up" with Corporation for approval of drawings. Fess structure noted above stage wise has some rational relation with the amount of work rendered. Thus, advance amount of Rs. 40,000/- and further amount of Rs. 40,000/- related with stage of submission of drawings for approval appears to be rational fees for the amount of work done by plaintiff till the stage of submission of drawings for approval, so far as farm house projects at Sultanpur is concerned.
48. Contention of the Counsel for defendant that no fees is payable to the plaintiff as no plan was submitted for approval by the plaintiff nor defendant is aware that any such plan was submitted is not sustainable in view of the clear cut testimony of DW1 that all the communication made by the MCD were used to be addressed to him as well to Mr. S. C. Bahargava and the copies of the said communication were used to be sent to both of them. Defendants themselves have filed Ex D-3 to D-5 letter/notice issued from issued in connection with consideration for approval of plan for farm house CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 20 of 37 which was ultimately rejected by the MCD vide. letter Ex D-6. Hence, to say that plaintiff did not at submitted plan or submitted without approval of the defendants is not sustainable.
49. In respect of renovation work at W-155, G.K. - II, plaintiff has claimed 15% of the cost of renovation. As per plaintiff a sum of Rs. 36,00,000/- was spent by the defendant for the renovation at W-155, G.K.-II and therefore 15% of the said value comes to Rs. 5,40,000/- which it is claiming for its services rendered by it. It has already been held above that plaintiff's services were engaged by the defendants in respect of this renovation work. It is the case of the defendants that work force sent by plaintiff left the work incomplete and they had got it completed through M/s Mac Construction Co. and total cost of renovation was Rs. 2,75,000/-. However, in evidence DW1 deposed that they were compelled to engage another set of engineers and a construction company at a further cost of Rs. 2,75,000/-. In their written statement defendants have denied that Rs. 36,00,000/- was the cost of renovation as claimed by the plaintiff but in testimony use of expression "at a further cost of Rs. 2,75,000/-" conveys that such amount was the additional cost over and above which would have been spent if the plaintiff had not been there in the beginning.
50. While cross examining PW1 it was suggested to him that plaintiff resorted to sharp practices as regards renovation permissible in law and without further plans being prepared and submitted. It was further suggested that because of plaintiff's handling defendants would have lost substantial amount of money but for the fact that another building firm took the matter in hand and finished the work for Rs. 2,75,000/-. It was further suggested that plaintiff had made no worthwhile work and he was liable for the damages and counter claim of the defendants. All the suggestions were denied by the PW1 and he volunteered that renovation work was not done for Rs. 2,75,000/- but for Rs. 36,00,000/- according to bills verified by him as submitted by the contractor CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 21 of 37 for Rs. 37,00,000/- and odds amount and he had already exhibited those documents on record.
51. PW1 further in his cross examination categorically deposed that the renovation of house at G.K was all designed by plaintiff after taking the requirement of defendant No.1 and list prepared for the items of work for renovation of House. He went on to depose that thereafter complete drawings were prepared, thereafter specification of construction were agreed upon by the defendants and quotation obtained from the Mac Construction Co. from the very beginning. He further deposed that the entire renovation work was carried out as per drawings prepared, specification agreed upon by the defendant as well as the contractor. He further deposed that they (plaintiff) supervised the entire work which was initiated and completed in all respects. He further deposed that running bills as submitted by Mac Construction Co. from time to time and payments recommended to be made to the contractors and paid by the defendant. Plaintiff filed on record the entire runnings bills Ex PW1/41 to Ex PW1/52 and two more bills Ex PW/56 and Ex PW1/57. Of course these bills have not been proved in accordance with Evidence Act by calling witness from Mac Construction.
52. In paragraph 9 of the plaint, plaintiff give details (running into almost 4 legal size pages) addition/alteration besides typical changes desired by the defendants in property at G-155, G.K.-II, Delhi. In paragraph 10 of the plaint, plaintiff gave details (running into almost 2 legal size pages) of drawings prepared by him in respect of renovation work at W-155, G.K.-II which admittedly admeasures 415 sq.yds. In paragraph 11 of the plaint, plaintiff pleaded that in consultation with defendants plaintiff identified contractors, who completed works under the supervision/guidance of plaintiffs. It is further pleaded that the renovation project costed Rs. 36 lacs to defendants, which they paid to the contractors identified/deputed and defendants occupied the renovation house on 13.04.1992. CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 22 of 37
53. Defendants in their written statement replied the said paragraphs of the plaintiff jointly in paragraph 6 of reply on merits which is under:-
"The averments as made in paragraphs 9, 10,and 11 of the plaint are false, incorrect and misleading and are denied. In reply to paras 9 to 11 of the plaint, it is stated that even while Mr. S. C. Bhargava was resorting to his confidence tricks, and involved the answering defendants in unnecessary and knowingly vexatious proposals, it was the misfortune of the answering defendants to have cursorily talked with him in respect of renovation of a residential property which Defendant No.1 and his Father had recently acquired in Greater Kailash Part-II, New Delhi. Without so much as asking for any specific suggestions from the answering defendants, Mr. S.C. Bhargava began by giving the impression that he was only trying to help them out in the routine renovation of the property situate in an area of about 415 sq. yds. The team of workers sent by Shri S. C. Bhargava for the renovations subsequently declined to completed the work. The answering defendants ultimately were compelled to employ another set of architects and builders by the name of M/s Mac Construction Co. and spent a total of Rs. 2,75,000/- on the said renovation. It is frivolous on the part of the plaintiff to allege that the renovation project cost Rs 36 lakhs. It is also incorrect that the plaintiff can make any claim for any so called 'consultancy charges' as made out in the plaint. In any event the said claim is denied. The moneys paid to Mr. S.C. Bahragava have been detailed hereinafter."
54. Perusal of the above reply of the defendants shows that defendants have chosen to remain vague. They did not specifically deny the extent of renovation desired to be undertaken nor did they come out with their own details of renovation got carried out by "another set of architects and builders". Further they did not give details of works allegedly left behind by plaintiff's work force nor did they explain from what stage "the another set of architects and builders" took over. Further more, from above quoted reply it also shows that case of the defendants is that services of the plaintiff was not engaged plaintiff began with impression that he was trying to help them out in routine renovation of the property situate in an area of about 415 sq.yds. However, DW1 categorically deposed in his cross examination that assignment CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 23 of 37 of renovation work at the house property was in fact second assignment to which he (DW1) had not agreed. Based upon evidence it has already been held herein before that service of the plaintiff was engaged for this renovation work at W-155, G.K.-II.
55. In this circumstance when defendants is held to have assigned the work of renovation for their house at W-155, G.K-II to the plaintiff and when defendants alleged that plaintiff's men have left the work incomplete and they got it completed from "the another set of architects and builders", then it is for defendants to prove the extent of renovation carried out by plaintiff, the stages after which plaintiff's men left the renovation work incomplete, the stage from which "the another set of architects and builders" took over, details of the total and extent of work done by those "another set of architects and builders" and the total amount paid to them, as defendants are the best party to have in possession of best evidence.
56. In this regard DW1 in his examination-in-chief deposed almost on the lines of the above quoted stand with change of stand that another set of engineers and construction company were engaged at a further cost of Rs. 2,75,000/- to complete the work. Their earlier stands was that total cost of renovation was Rs. 2,75,000/-. But in the testimony use of expression "at further cost of Rs. 2,75,000/" conveys that renovation cost got escalated further by Rs. 2,75,000/- over and above the cost to which plaintiff has agreed to renovate the same. He further deposed that Shri S.C.Bhargav of plaintiff manipulated the affairs in a manner to obtain unfair financial advantage and gain in such manner that he would have made him lose a substantial amount of money. He, however, did not elaborate on this aspect as to how defendants would have lost substantial money and in what manner Sh. Bhargava was conducting the affairs so as to cause him loss.
57. More over, in evidence again DW1 did not depose the extent of CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 24 of 37 renovation carried out by plaintiff, the stages after which plaintiff's men left the renovation work incomplete, the stage from which "the another set of architects and builders" took over, the details of the total and extent of work done by those "another set of architects and builders" and the total amount paid to them. DW1 did not produce any bills raised by said "another set of engineers or builders".
58. In cross examination he deposed that no payment on account of W-155, G.K-II was paid to the plaintiff. He further deposed that he did not remember if plaintiff had prepared 50 drawings for execution of work at W- 155, G.K.-II. He further deposed hat M/s Mac Construction was appointed by him to renovate W-155, G.K.-II. He denied the suggestion that he got false bills prepared from Mr Somesh Malik, the owner of Mac Construction.
59. Defendant further examine one Prahlad Singh as PW2. He in his examination-in-chief deposed that he was employed with Mac Construction Company in 1992. He deposed that Shri S.M.Malik was contracted by defendant No.1 to complete the renovation work left unfinished by the previous contractor for 10-11 months. He further deposed that work undertaken by Sh. S.M. Malik included flooring, tiles in bathroom, sanitary fittings, white- wash, some plaster repairs and installation of doors, windows and electrical works in the kothi. He further deposed that defendant No.1 made the payments for the work done as per bills or notes raised by Sh. S. M. Malik.
60. His cross examination is of no use so far as plaintiff is concerned but this witness is of no help to the defendant either. He only explained the nature of work under taken by his employer at the site but he remained silent about the quality and extent of work undertaken and to what extent the previous contractor i.e. plaintiff had done the work. He is also silent about the value of work done and payment made to contractor by the defendant.
CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 25 of 37
61. None denial of the extent work desired to be carried out for renovation at W-155, none mentioning of work required by defendants for renovation, none leading of evidence by the defendant about the quality and extent of renovation work undertaken by the Mac Construction and the stage from it took over, lead this Court to draw adverse inference against the defendants. None filling of bills raised by the M/s Mac Construction in respect of renovation work also leads this Court to draw adverse inference against the defendants both in terms of extent and value of work undertaken. Admittedly, defendant No.1 is using the accommodation at W-155 after completion of renovation work and therefore work of renovation stood completed which work of renovation as per defendant was left incomplete by plaintiff but defendant failed to prove the quality, nature and extent of renovation work expected of plaintiff and to what extent same was left and to what extent same was taken over by "another set of engineers, architect and builder". All this leads this Court to conclude that entire renovation work was carried out in accordance with drawings/architectural designs prepared by plaintiff under its supervision/ guidance.
62. Now the next question is what was the fess agreed to. Plaintiff has submitted that fee settled was 15% of the cost of renovation work. As per defendant no fees was settled. DW1 in his cross examination deposed that he was told by his brother defendant No. 2 that no fees has been settled. Defendants did not examine defendant No.2 who allegedly told defendant No.1 that no fee was settled. However, defendants themselves put for admission of the plaintiff at the stage of admission-denial of documents a document purported to be letter written by the plaintiff which plaintiff admitted and the same was exhibited as Ex D-2. Ex D-2 is letter of acceptance of assignment of renovation project at W-155, G.K.-II written on behalf of plaintiff to the defendant. In the said letter it is clearly mentioned that fee to be payable would be 15% of the value of works as undertaken. Thus, it stands proved that fees agreed for this renovation work was 15% of the value of works as undertaken. CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 26 of 37
63. Next question is what was the cost of renovation work. Plaintiff claims it to be Rs. 36,00,000/- whereas defendants at one place claimed it to be Rs. 2,75,000/- but in evidence claimed that incomplete renovation work left by plaintiff was got completed at further cost of Rs. 2,75,000/-. Use of expression "at further cost of Rs. 2,75,000/-" conveys that cost of renovation got costlier by Rs. 2,75,000/-. Defendant was in possession of the best evidence as to the bills that his contractor Mac Construction Co. raised and as to the payment that defendants made the Mac Construction Co. None production of payments details call for drawing of an adverse inference against the defendants.
64. PW1 categorically deposed that Mac Construction Co. had raised bills for Rs. 37 lacs and so and same was verified and checked by him for Rs. 36 lacs. Thus, on the basis of preponderance of probability this Court was almost willing to accept that cost of renovation work was Rs. 36 lacs before the attention of this Court went to letter dt 27.07.1992 Ex PW1/16 and dated 28.01.1993 filed by plaintiff. By letter dt 27.07.1992 Ex PW1/16 plaintiff wrote to Mac Construction to raise bills in a particular way as the owners wished to have re-examined them at their own level. Letter dt 28.01.1993 is also written by plaintiff to defendant No.1 thereby demanding the balance payments in respect of its professional fees for the services rendered for renovation at W-155, G.K-II. Perusal of the same shows that cost of works was Rs. 25 lacs and plaintiffs fees was Rs. 3,75,000/-. Thus, it stood proved that plaintiff's fee for renovation at W-155 comes to be Rs. 3,75,000/- and not Rs. 5,40,000/- as claimed. DW1 categorically in his testimony admitted that no payments has been made to the plaintiff in respect of the renovation work. Thus, plaintiff is entitled to Rs. 3,75,000/- in respect of renovation work carried out at W-155, G.K-11, New Delhi.
65. Coming to third project i.e. factory project at Jaunpur. It is the case of the plaintiff that defendants engaged the services of the plaintiff for CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 27 of 37 architectural design, structural design, landscape, electrification, plumbing and other activities involved in security, fire fighting, drainage, sewage, provision of mechanical hoist etc. at the factory of respective defendants No. 3 and 4 situated on land comprised in khasra No.522 and 522/1 at Jaunpur. Fee settled was 10% of project cost and for convenience defendants desired plaintiff to bifurcate its billing in the name of defendants 3 and 4 lumpsum. Defendants agreed to pay Rs. 1 Lac for Rs.10 lacs cost in account of defendant No. 3 and Rs. 4 lacs in account of defendant No. 4, if project cost remain below Rs. 50 lacs. Plaintiff did all that was required and consumed 45 days of complete working. Plaintiff gave details of drawing prepared. Paragraph of 14 and 15 of the plaint contains averment in this regard.
66. Defendants in the written in the corresponding paragraphs have denied to have engaged the services of Sh. S.C. Bhargava/plaintiff in respect of the lands comprised in the plots in village Jaunpur, Delhi and also denied to have desired the plaintiff to bifurcate its billing in the name of defendants No.3. It has been alleged that plaintiff misled the defendants with respect to provision of construction in extended 'lal dora' in accordance with the existing bye-laws. No plans were submitted by Mr. S.C. Bhargava for approval for authority and on the other hand Mr. S.C. Bahrgava having made very vague, cursory and contradictory estimates, invited tenderers from various contractors. It was subsequently noticed that there was a wide variation in the estimates given by builders in response to the tenderer for work which were invited solely at the behest of Mr. S. C. Bhargava. No such factory has been constructed ill date and project had to be abandoned and presently same was not feasible.
67. It has already been held herein before that there was plaintiffs' services were engaged for factory at Jaunpur. Contesting defendants took the plea that they have no concern with defendant No. 4. However it came in evidence that DW1 admitted that he paid the plaintiff by way of cheque issued CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 28 of 37 from the defendant No.4. Similarly, at the stage of admission-denial of documents, defendants put to plaintiff for admission letter addressed by plaintiff to defendant No.4 which letter was exhibited as Ex D-7. Nothing has been explained by the contesting defendants as to how this letter came to them when they had no concern with defendant No.4. This show that defendants is attempting to misled the court by denying its relation with defendant No.4.
68. PW1 in his examination-in-chief deposed that pursuant to assignment of work in respect of factory at Jaunpur plaintiff carried out the architectural design, structural design, landscape, electrification, plumbing and other activities involved in the project besides design for security, fire fighting, drainage, sewage, provision of installing mechanical hoist etc. at the factory of respective defendants No. 3 and 4 situated in on land comprised in Khasra No. 522 and 522/1 at Jaunpur, New Delhi. The drawing of said factory as provided by defendants is Ex PW1/58. The drawing prepared are exhibited as Ex PW1/60 (colly). He further deposed that complete construction drawings sufficient for inviting lumpsum bids from contractors, scrutinized the quotation as received from the tenderer and submitted report for pointing contractors. He further deposed that thereafter defendants desired plaintiff to invite bids based upon tender documents as prepared, scrutinized the quotations and finalise contracts with identified construction agency. Tender notice/tender documents and quotations exhibited as Ex PW/62 (colly).
69. In cross examination he deposed that he had no idea of the constitution of defendant No.4. He volunteered that when he had given is first letter addressed to defendant No.1, defendant No.1 himself told him that quotation may be given in the name of defendant No.3 and 4 separately. He denied the suggestion that none of the defendants had told him about any work of defendant No.4. He further deposed that factory project in khasra number 522 and 522/1 at Jaunpur village was divided in two portions, one owned by defendant No.3 and other by defendant No.4. He admitted that there was no CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 29 of 37 contract in writing for this project. He volunteered that the modus operandi of the defendants was to ask for letter from him. No acknowledgement were given. He further deposed that the letter which he sent to defendant No.1 for performing duties connected with the factory at Jaunpur, he was asked by defendants to submit different letters to defendant No. 3 and 4. He admitted that there was no factory premises in the khasra number 522 and 522/1 at the time of his assignment. He further deposed that all the negotiations with defendants No. 1 and 2 for his services, fee and charges payable was settled orally and thereafter he put in writing the oral discussion in his letter of acceptance. He deposed that he did not receive any acknowledgment in writing but he was paid part payment for assignment.
70. In cross examination in response to specific question as to what he did in project at Jaunpur, PW1 deposed that the first thing he did was to ask for the requirement of the client and thereafter he discussed the matter with defendants No.1 and 2, prepared sketch plans and got approval in principle from them and then prepared detailed architectural drawings and all connecting drawings for the purpose of carrying out building at the site. He continued deposing that the client desired him to procure a lumpsum contract for the work to be carried out at site, specification of work in detail were prepared and tenderers floated inviting quotation from the contractors. Further the tenderers were issued to the parties who opted to obtain the tenderers from his office as well as recommended by the defendants for the work to be carried at site. He further deposed plaintiff prepared the comparative statement of the tenderers as received from the bidders and submitted its report to the defendants for appointment of contractors
71. In cross examination in response to the query as to why he did not feel the necessity of having a written contract when he was supposed to do such a huge project, he deposed that he was associated with the defendants since August 1990 when he was given the assignment of farm house, thereafter CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 30 of 37 assignment of house in Greater Kailash and thereafter the need for establishing the garment factory was given when the defendant were closely about to purchase property A-23, Okhla on which his consultation was sought. He further deposed that after having worked for three projects defendants asked him to work on the fourth project i.e. Jaunpur factory. He further deposed that since he issued the acceptance letter in the name of defendant No.1 and thereafter asked to prepare separate-letters in the names of defendants No. 3 and 4 by defendants No.1 and 2 and he was also issued part-payments through cheque for the project. He did not insist for written contract. He further deposed that issuance of quotation of tenderers was through panel of contractors maintained in his office as well as those recommended by the defendants. He did not have or proof of acknowledgement of the receipt of this report by the defendants. He volunteered that he did have records which mean regarding an engineer being appointed by the defendants for follow up action.
72. In response to query as to the requirement for obtaining sanction for a garment factory by the MCD or any other statutory body, he deposed that he was told by the defendants that the plot in situated in extended Lal dora and as per Gazette Notification issued by the Government of Delhi in 1963 since the buildings Bye-laws were not applicable to building situated in lal dora/extended lal dora, no sanction was required to be taken for that building in lal dora area. As to whether he can cite any such provision he deposed that there are court rulings to this effect. He denied the suggestion that entire exercise was carried out as per his assurance regarding 'No objection' in engaging of competent contractor and the vast disparity in the estimates and quotation. He admitted that size of the two plots were 1830 sq.yds. He denied the suggestion that because of his failure the concerned defendants were forced to abandon the construction of manufacturing facility.
73. In response to question as to the basis of his claim of the project costing Rs. 75,00,000/-, PW1 he deposed that the proposed unit first contained CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 31 of 37 as an area of 12,000 sq. ft. when estimate of Rs. 50 lacs was given initially as a matter of requirement during the course of development of design, as per the requirement of the defendants, the area was increased to 16,000/- sq. ft. thereafter the defendants desired richer specifications of construction and additional requirement were given for providing service lifts for movement of materials as also additional requirement in the washing area of the garment unit, resulting in escalation and by the time tenderers were called the estimates was finalised.
74. As to reason for the wide disparity in the rates quoted by the tenderers, PW1 deposed that the rates were quoted by the tenderers on the basis of their set up including overheads the tenderer has. However, he deposed, in his record he dealt with all these matters and reflected the same in his report as contained in exhibits quoted above. He denied the suggestion that because of his failure as detailed in the written statement, this project could not be taken in hand. He deposed that he had made all the preparation but he did not know why this project was not taken in hand. The details in this behalf are given by him in Ex PW1/62 (colly). He further deposed that in this project the defendants never said no but some how it was postponed and not taken in hand. He denied the suggestion that he had not done any worthwhile work and have raised a fabricated and cooked up claim without any justification.
75. Plaintiff also examined PW2 Sh. Sarup Singh who had participated in the tendered process floated by the plaintiff for the purpose of carrying work/construction at the factory site at Jaunpur. In cross examination PW2 deposed that he did not know if defendants have permitted plaintiff to float any tender nor did he enquire what rights the defendants had in the plot.
76. DW1 in his examination-in-chief deposed that Sh. S. C. Bahrgava sought to persuade him and his brother defendant No. 2 to prevail upon the other partners of defendant No. 3 for developing the lands at Jaunpur by CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 32 of 37 establishing a unit for manufacturing garments. In this behalf Sh. S.C. Bahragava held out various assurances and representation about his bonafides and ability to carry out the construction at reasonable cost at the lands at Jaunpur by inviting tenderers and engaging competent contractors. To achieve this S.C. Bhargava drew up and issued tenderers for various civil works without showing then the said documents on the ground that he was well versed with such procedures and would necessarily engage the best contractor.
77. He further deposed that when the tenderers was opened, it was found that there were serious variations in the rates quoted by the tenderers. On scrutiny and inquiries from the tenderers, it was found that the variations in rates had occasioned because of contradictory specification and faulty terms mentioned in the notice inviting the tenderers issued by Sh Bhargava and the plaintiff. The bids sent by the tenderers in response to the notice inviting bids based on the documents drawn by plaintiff, were inchoate and unworkable. Further Sh. Bhargava had not applied for any permission for erecting a commercial facility in the lands in the extended lal dora. Due to serious lapse and failure even Sh. Bahragav could not agree to the quoted rate and was unable to fix the terms on which the work could be completed. This led to the cancellation of the bids at huge personal embarrassment to defendants.
78. With respect to above referred testimony of DW1 qua Jaunpur project, plaintiff did not carry out any cross examination on any of the above points. It is settled rule of appreciation of evidence that when a witness is not cross examined on the point he has deposed, then the testimony of the witness is deemed to have been accepted by the opponent.
79. Thus, the effect of non cross examination on above aspect is that plaintiff shall be deemed to have admitted that charge of the defendants that because of plaintiff's serious lapse and failure documents drawn by plaintiff, were inchoate and unworkable which even Sh. Bhargava was unable to fix the CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 33 of 37 terms on which the work could be completed and thus it led to the cancellation of the bids. Thus, plaintiff is not entitled to any fee in respect of its work qua the factory at Jaunpur.
80. Thus, in view of the above discussion, plaintiff is held entitled to Rs. 80,000/- qua the farm House project and Rs. 3,75,000/- qua the W-155, G.K-II project. Thus in all plaintiff is entitled to only Rs. 4,55,000/- out of which plaintiff claims to have received only Rs. 1,92,500/-. Though defendants claimed to have paid Rs. 4,78,000/- but did not lead any evidence to prove that such amount was paid to the plaintiff. Hence, plaintiff is entitled to Rs. 2,62,500/-. Hence, in view of the above discussion issue No.4 is decided accordingly in favour of the plaintiff and against the defendant.
ISSUE No.5 :- Whether the plaintiff is also entitled to the interest for the aforesaid amount and, if so, at what rate and for which period?
81. Onus to prove this issue upon the plaintiff. Plaintiff has claimed interest at the rate of 21% per annum. There is no evidence that there was such agreement between the plaintiff and defendant about the payment of interest at such rate in case defendants delays payment. There is no evidence that such rate of interest is payable by way of custom and practice in the kind of business plaintiff is engaged in. Thus, plaintiff is not entitled to interest for any pre- litigation period.
82. Section 34 of CPC provides for grant of interest pendente-lite at its discretion at any rate not exceeding 6% and future interest at any rate not exceeding contractual rate and if there is no contractual rate than not exceeding the rate at which nationalised banks advance loan. Keeping in mind the said provision interest of justice would be served if plaintiff is granted simple interest @ 6% per annum from the date of institution of the suit till its actual realization. Hence issue No. 5 stands decided accordingly in favour of the plaintiff and against the defendant.
CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 34 of 37 ISSUE No.6 :- Whether the defendants are entitled to any relief on their counter-claim and, if so, for what amount?
83. Onus to prove this issue is upon the defendants. Defendants have claimed following sums from the plaintiff:-
1. Refund of the amount paid to Sh. S. C. Bhargava ...............Rs.4,78,000.00
2. On account of escalation in the cost of construction at the residential house on the agricultural lands at village Sultanpur, Delhi and at village Jaunpur ...........Rs.10,00,000.00
3. Amount paid M/s MAC Constructions Co. to complete the renovation work at the residential house .................Rs. 2,75,000.00
4. Towards liquidated damages ..................Rs. 2,33,000.00 Though total of all this becomes Rs. 19,86,000/- but defendants have claimed Rs. 20,00,000/-.
84. First claim of the defendant is with respect to refund of amount of Rs. 4,78,000/-. Plaintiff admitted to have received over all payment of Rs. 1,92,500/- only. Except for oral evidence defendants did not lead any documentary evidence to show that it has in fact paid Rs. 4,78,000/- to the plaintiff. No account has been furnished by the defendants to prove that they had paid Rs. 4,78,000/-. Therefore on this ground alone defendants claim for the refund of Rs. 4,78,000/- is liable to be rejected.
85. With respect to claim of damages qua the cost of escalation at farm house at Sultanpur is concerned, the claim of the defendant is liable to be rejected on their plea itself. It has been claim of the defendant that plaintiff knew that no residential unit could be permitted in the agricultural land but plaintiff induced the defendants that it will get the plans approved from the CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 35 of 37 corporation and thus cheated the defendants. At the same time defendant is asking as damages the cost of escalation in the unit at farm house. When no construction at all can legally raised as claimed by the defendant then where is the question for asking damages qua the cost escalation. Hence claim of the defendants for damages qua the cost escalation at farm house is hereby rejected.
86. So far as the cost escalation qua the factory site at Jaunpur is concerned, no evidence has been led by the defendants as what would have been the cost of construction at the site when plaintiff had under taken the job and by how much it got escalated when he allegedly failed. There is nothing on record to help this court to asses such escalation in the cost. Further, there is evidence to show that an effort was being made on the part of the defendants to raise construction so as to show that there was willingness to raise construction. It has also come in evidence that in the meantime one of the plot has been sold off. Hence, in this circumstance defendants are not entitled to damages for cost escalation qua the factory project at Jaunpur.
87. So far as amount of Rs. 2,75,000/- i.e. the payment made to Mac Construction Co. is concerned, as per pleadings of the defendants entire cost of renovation was Rs. 2,75,000/- and as per testimony cost got escalated further by Rs. 2,75,000/-. Defendants did not lead evidence so as to show how much was actually paid to the Mac Construction Co. and what was the volume of work undertaken by the said Mac Construction Co. Now if Rs. 2,75,000/- was to be the cost of entire renovation then there is no question of defendants being entitled to claim the same and if that was the amount by which cost escalated then in that event defendants is required to prove what was the value of work that was to undertaken by plaintiff. Defendants did not prove any of them, hence defendants are not entitled to amount of Rs. 2,75,000/- as claimed.
88. So far as claim for liquidated damages of Rs. 2,33,000/- is CS No.609875/16 M/s Bharagva & Associates Pvt. Ltd Vs Onkar Singh Pasricha & Ors Page No. 36 of 37 concerned, there is no evidence from the side of the defendants as to how defendants is entitled to such amount. He has not explained what loss has occurred to them. Hence, defendants are not entitled to even the liquidated damages of Rs. 2,33,000/-.
89. Hence, in view of the above discussion defendants are not entitled to any of the amount claimed by way of counter claim and therefore, issue No. 6 is decided against the defendants and in favour of the plaintiff.
ISSUE No. 7 :- If the aforesaid issue is answered in favour of the defendants, whether the defendants are entitled to interest and, if so, at what rate and for which period
90. In view of the findings recorded on issue No. 6, issue No.7 does not call for any adjudication and disposed of as such.
Relief In view of the above discussion suit of the plaintiff is partly allowed and decree a decree for recovery of Rs. 2,62,500/- (Two Lacs Sixty Two Thousand and Five Hundred Only) is hereby passed in favour of the plaintiff and against the defendants, along with simple interest at the rate of 6% p.a. from the date of institution of the suit till amount is actual realised.
Counter claim filed by the defendants No.1 to 3 is hereby dismissed.
Cost of the suit is also awarded in favour of the plaintiff. Decree sheet be prepared accordingly.
File be consigned to Record Room after the necessary
Digitally signed
HARISH by HARISH
compliance. KUMAR
KUMAR
Date: 2018.12.03
15:22:51 +0530
(Harish Kumar)
Announced in the open Court. ADJ-13(central)/THC
(Judgment contains 37 pages) Delhi/03.12.2018
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