Gujarat High Court
Nd Patel & Co vs District Panchayat on 15 June, 2023
Author: Bhargav D. Karia
Bench: Bhargav D. Karia
NEUTRAL CITATION
C/FA/2762/1999 JUDGMENT DATED: 15/06/2023
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 2762 of 1999
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE BHARGAV D. KARIA Sd/-
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1 Whether Reporters of Local Papers may be allowed No
to see the judgment ?
2 To be referred to the Reporter or not ? No
3 Whether their Lordships wish to see the fair copy No
of the judgment ?
4 Whether this case involves a substantial question No
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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ND PATEL & CO.
Versus
DISTRICT PANCHAYAT & 1 other(s)
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Appearance:
MR PARAS SUKHWANI FOR MR KG SUKHWANI(871) for the Appellant(s)
No. 1
MR D M AHUJA(115) for the Defendant(s) No. 1
MR KURVEN DESAI, AGP for the Defendant(s) No. 2
RULE SERVED BY DS for the Defendant(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA
Date : 15/06/2023
ORAL JUDGMENT
1.Heard learned advocate Mr.Paras Sukhwani for learned advocate Mr.K.G.Sukhwani for the Page 1 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023 NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined appellant and learned Assistant Government Pleader Mr.Kurven Desai for the respondent no.2.
2.Being aggrieved and dissatisfied by the Judgment and Order dated 10.02.1999, passed by the learned 3rd Joint Civil Judge(SD), at Junagadh, in Special Civil Suit No.37 of 1992, the appellant-original plaintiff has preferred this appeal.
3.The appellant-original plaintiff is a registered partnership firm engaged in the construction of roads.
4.The respondent no.2- original defendant no.2 i.e. Executive Engineer, Panchayat (Road & Building) Division No.-2, Junagadh invited a tender from public at large for construction of the State Road (S.R.) from Prachi Railway Station to Coastal Highway.
5.The estimated cost of work was Rs.36,54,187/-. The appellant made an offer to construct the road for Rs.34,62,587.44/- which was accepted by the respondents- original defendants as such offer was lowest. A regular agreement was entered into between Page 2 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023 NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined the parties being B-2/20 of 1987-88(Exh.-138 and photocopy at Exh.137).
6.A work order was issued on 05.1.1988 with stipulated period of eight months to complete the work on or before 10.09.1988. Thereafter, the extension was granted till 28.02.1989 (Exh.126).
7.The appellant thereafter prayed for extension from 28.02.1989 as the work could not be completed in time. However, request for such extension was rejected by the respondents. The respondents thereafter imposed penalty of Rs.100/- per day with effect from 10.09.1988.
8.The appellants therefore being aggrieved filed Special Civil Suit No.37 of 1992 in the Court of 3rd Joint Civil Judge(S.D.), Junagadh, for liquidated damages of Rs.19,11,396/-. The learned Judge after considering the oral and documentary evidence on record dismissed the suit by passing a Judgment and decree on 10.02.1999, directing the appellant to bare the cost of the suit and pay to the respondents.
9.Learned advocate for the appellant submitted Page 3 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023 NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined that the Trial Court has wrongly arrived at a conclusion that the appellant is guilty of breach of contract by relying upon the evidence of the witness of the defendant at Exh.150 who had no personal knowledge.
10. It was submitted that the liquidated damages claimed by the appellant was supported by various correspondence between the appellant and respondents wherein the appellant has pointed out the delay had occurred due to non-supply of the material by the respondents i.e. steel, cement etc. Therefore the appellant was justified to claim liquidated damages on account of loss of profit, loss of unrecoverable advance made to labourers, the amount towards idle labour charges and towards extra cost incurred for completion of the work. The appellant also claimed refund of the penalty imposed by the respondents. It was submitted that the claim of the appellant was on account of breach of the contract committed by the respondents which prevented the appellant from performing his part of the contract and therefore the slowness in the work was attributable solely to the breach committed by the respondents in Page 4 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023 NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined performing their part of obligation under the agreement.
11. It was further submitted that the Trial Court has decided the issue no.3 contrary to the evidence on record and held that the plaintiff failed to prove that the firm was ready and willing to perform its part of contract but the defendants did not fail to perform their respective part. It was submitted that the Trial Court in arriving at such finding failed to appreciate that no itemwise programme was given by the respondent no.2 by misreading and misinterpreting the Exhibits -42, 44, 73, 78 to 81, 84-89, 92, 123 to 125 , 132, 133 and 137 which pertains to the oral evidence of the witness of the Kantilal Devshibhai and the correspondence between the appellant and the respondents.
12. It was further submitted that the Trial Court also failed to consider the documentary evidence produced by the appellant at Exhibits-49, 51 to 54 and 106.
13. Learned advocate for the appellant further submitted that the Trial Court having Page 5 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023 NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined held that the time was extended once yet wrongly came to the conclusion that time is the essence of the contract. Reliance was placed on the decision in case of Hind Construction Contractors vs The State Of Maharashtra reported in AIR 1979 SC 720 to submit that once the authority has extended the time then it cannot be said that the time is the essence of the contract.
14. Learned advocate for the appellant submitted that there was no evidence produced by the respondents for imposition of the penalty/ compensation and despite such fact, the Trial Court wrongly relying upon the various clauses of the contract came to the conclusion that the appellant was not ready and willing to perform its part of the contract and therefore, liable to pay the penalty.
15. On perusal of the impugned judgment and decree and considering the submissions made by learned advocate for the appellant following points arise for determination.
1. Whether the Trial Court has committed an error in holding that the appellant Page 6 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023 NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined was not ready and willing to perform its part of the contract?
2. Whether the Trial Court has committed an error in holding that there is no breach of contract on the part of defendant-respondents?
3. Whether the Trial Court has committed an error in holding that the appellant-plaintiff has failed to prove alleged claim for damages under different heads?
4. Whether the Trial Court has committed an error in holding that the respondents-defendants have proved that the time was the essence of the contract and the appellant-plaintiff failed to complete the work in stipulated time?
5. Whether the Trial Court has committed an error in holding that the appellant-plaintiff has failed to prove the act of imposing penalty by the defendant is illegal, wrongful or unjust?
Page 7 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined
16. The appellant examined Kantilal Devshibhai as witness at Exh.42 wherein he deposed that the work was prolonged for five to six months due to rainy seasons and necessary materials were not made available by the department however in cross- examination he was confronted with various letters issued by the respondents which are produced at Exh.79 to 81, 84, 85, 87 to 89, 93, 123 to 125, 132 and 133 which was accepted by him. Thus the appellant despite repeated reminders from the respondents failed to complete the work within extended time and therefore, the Trial Judge formed an opinion that there was neither delay nor failure on the part of the respondents to supply the steel, cement etc. as alleged by the appellant and the appellant failed to prove such aspect on the basis of any oral or documentary evidence.
17. The Trial Court has rightly come to the conclusion that the appellant failed to prove any of the claims after considering the oral evidence of the witnesses of both the sides as the respondents had always shown readiness and willingness to perform its part of obligation under the agreement and it was the Page 8 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023 NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined appellant-plaintiff who did not show any progress in the work.
18. The Trial Court has considered the oral evidence of the witness of the respondent at Exh.126 who was a Executive Engineer in R & B Division, Junagadh District Panchayat and in his deposition he referred to the delay by the appellant in execution of the work for which penalty was imposed by the Executive Engineer after granting the request to extend the time upto 28.02.1989.
19. From the record, it appears that the witness of the contractor Kantilal Devshibhai (Exh.42) in his deposition accepted that the penalty was levied at the rate of Rs.100/- per day but at the same time it was admitted in his cross-examination that the work was not completed within the stipulated time inspite of repeated instructions given by the respondents to complete the work by the appellant-plaintiff.
20. The learned Judge has referred to and relied upon the documents on record comprising of letter of department to the appellant-plaintiff at Exh.49 in which it was Page 9 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023 NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined stated that despite written instructions he did not resume the work, letter dated 21.11.1985 at Exh.47 stating that the work progress was extremely slow which should be increased or else steps would be taken by the respondents, letter of the Sarpanch of the Gram Panchayat Dhebar to the Executive Engineer at Exh.48 stating that construction work of the bridge was closed since two months, letter dated 12.05.1986 of the Deputy Executive Engineer at Exh.49 stating that the work had stopped since long despite repeated instructions of the department the same had not been resumed. Similar letters were written at Exh.50 on 27.05.1986, Exh.51 on 15.07.1986, Exh.52 on 27.12.1987 and Exh.53 on 13.02.1987. By letter dated 20.05.1987, the Executive Engineer at Exh.54 informed the appellant contractor to complete the remaining work promptly and as the required quantity of steel and cement were kept reserved for that purpose.
21. Letter dated 07.10.1987 at Exh.55 by the Executive Engineer to the appellant contractor stating that the representative of the contractor had remained present before the committee on 17.08.1987 in which he had Page 10 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023 NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined undertaken to complete the construction work of certain portion immediately and necessary quantity of steel was also issued and the quantity of cement was kept reserved for the same however, no progress was made in the work.
22. There are numerous documentary evidences in the form of correspondence between the appellant and respondents as series of letters were issued by the department but the same are not referred to for the sake of brevity. Suffice it to record that inspite of several reminders, letters written by the respondents urging the appellant to speed up the work assuring the supply of required quantity of cement and steel, the appellant did not show any progress in the work. It was on account of such reason that for the entire period of eight months of the contract as well as for extended period of one more year no substantial work could be performed and the respondents were forced to decide not to extend any time limit any further for the construction work.
23. In view of the oral and documentary evidence it cannot be said that the Trial Page 11 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023 NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined Court has committed any error in holding that the appellant was not ready and willing to perform its part of the contract nor there is any breach of contract on the part of the respondents whereas the appellant has failed to prove alleged claim for damages under different heads and the respondents have proved that the appellant-plaintiff failed to complete the work in stipulated time after even granting extension. The Trial Court was therefore justified in holding that the appellant-plaintiff has failed to prove the act of imposing penalty by the respondents- defendants was illegal wrongful or unjust as the slow progress in the work was attributable to the appellant-plaintiff.
24. The main allegations of the appellant with regard to non-supply of the necessary steel and cement is also without any basis as the record reveals otherwise in view of the repeated letters written by the respondents urging the appellant to resume the work assuring the supply of cement and steel and other materials.
25. In view of the foregoing reasons, no interference is warranted in the impugned Page 12 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023 NEUTRAL CITATION C/FA/2762/1999 JUDGMENT DATED: 15/06/2023 undefined judgment and decree passed by the Court below and it is also not necessary to examine the claim separately as no serious disputes or arguments were advanced with respect to the individual claims.
26. In the result, the First Appeal fails and is accordingly dismissed.
27. The Records and Proceedings of the case be transmitted to the concerned Trial Court forthwith.
Sd/-
(BHARGAV D. KARIA, J) URIL RANA Page 13 of 13 Downloaded on : Sat Sep 16 20:16:11 IST 2023