Delhi District Court
M/S R.K. Goel Abhey Kumar Jain vs South Delhi Municipal Corporation And ... on 17 August, 2024
IN THE COURT OF SH. AJAY PANDEY
DISTRICT JUDGE (COMMERCIAL COURT-10) CENTRAL,
TIS HAZARI COURTS, DELHI
CS Comm 192/2019
M/s R.K. Goel Abhey Kumar Jain
C-1/40, Ashok Vihar, Phase-II,
Delhi-110052 Plaintiff
Vs
1. Municipal Corporation of Delhi
Through its Commissioner
Headquarters,
Dr. Shyama Prasad Mukherjee Civic Centre
Jawahar Lal Nehru Marg
New Delhi-110002
2. Executive Engineer, PR-1, South
Under Bhisham Pitamah Flyover
Sewa Nagar, New Delhi-110003 Defendants
Date of Institution : 12.02.2019
Date of Arguments : 09.08.2024
Date of Judgment : 17.08.2024
JUDGMENT:-
SUIT FOR DECLARATION AND RECOVERY OF RS.21,96,507/- (RUPEES TWENTY ONE LAKH NINETY SIX THOUSAND FIVE HUNDRED AND SEVEN ONLY)
1. The present suit for declaration and recovery has been filed by plaintiff with following prayers:-
a) pass a decree in the sum of Rs.21,96,507- (Rs.
Twenty one lakh ninety six thousand five hundred and M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 1 of 68 CS Comm 192/2019 seven only) in favour of the Plaintiff and against the Defendants and also pendente lite and future interest @ 12% per annum due to losses suffered by the Plaintiff AND
b) Pass declaration that the actions taken by the defendant against the Plaintiff vide its letter dated 20.05.2014 and 11.02.2015 were bad, illegal and the same were not in order
c) Award cost of the suit in favour of the Plaintiff and against the Defendants AND
d) Pass such order or further order as the court may deem fit and proper in the facts and circumstances of the case in favour of the plaintiff and against the defendants.
2. It is culled out from the plaint that the sum of Rs.21,96,507/- is comprised of Rs.13,38,722/- being the amount recovered/deducted by the defendant from the payment of the final bill of the plaintiff for work done. In addition thereto plaintiff has claimed interest of Rs.5,95,023/- on the said amount of Rs.13,38,722/- @ 12% per annum w.e.f. 05.03.2015 to 15.11.2018. Additional sum of Rs.2,59,921/- comprising the principle sum of Rs.1,81,885/- and interest of Rs.80,847/- w.e.f. 15.12.2018 on account of reimbursement under Clause 10CA of the agreement is also included in the sum of Rs.21,96,507/-. M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 2 of 68 CS Comm 192/2019 PLAINT
3. Shorn off unnecessary details, relevant facts in the plaint are that :-
3.1 Plaintiff is a registered partnership firm and Sh. Nitin Jain is the registered partner of the same.
3.2 Defendant invited tenders for work of improvement and strengthening of internal roads by dense carpeting vide tender no. 198660. The notice inviting tender stipulated time as the essence of contract.
Bid amounting to Rs.1,33,87,221/- offered by the plaintiff was accepted by the defendant and work order no. EE Project South - I/SYS/2013-2014/6 dated 28.09.2013 was awarded to the plaintiff. Agreement was signed between the parties on 14.03.2014. The said agreement is in the custody of the defendant. The stipulated dates of start of work and completion of work were 07.10.2013 and 06.04.2014 respectively.
3.3 Immediately after receipt of work order plaintiff took over site from the defendant and arranged infrastructure, labour, material, T&P and machinery for execution of work and informed the same to defendant vide his letter dated 03.10.2013.
3.4 Defendant got started the work from plaintiff in accordance with their job mix formula already approved on 02.01.2013 which was valid upto 01.01.2014. Plaintiff sent the samples of material for the job mix formula for bituminous macadam and dense M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 3 of 68 CS Comm 192/2019 bituminous concrete to the defendant vide his letter dated 03.10.2013 for getting the same approved from the approved laboratory as per terms and conditions of the tender/agreement, but no approval of Job Mix Formula was provided.
3.5 Vide letter dated 10.01.2014, defendant directed the plaintiff to get new job mix formula approved. Plaintiff immediately got prepared the demand draft amounting to Rs.60,000/- vide DD No. 684896 dated 10.01.2014 against the testing charges and deposited the same to the defendant and the defendant sent the material to the Superintendent Engineer lab SDMC Alipur Road, Delhi-110054 without verifying that the said laboratory was not functional. As the said laboratory was not functional, the samples were returned and were again sent to private laboratory i.e. Bharat Test House on 14.03.2014. Plaintiff has thus alleged that the delay of 163 days w.e.f. 03.10.2013 to 14.03.2014 was caused on the part of the defendant alone. The formula was got approved on 20.03.2014.
3.6 Meanwhile, on 20.11.2013 Engineer Incharge of the defendant wrote letter to harass the plaintiff making allegations that the work had not been started. Plaintiff replied the said letter on 24.11.2013 elaborating that the work had already been started and would be completed soon.
3.7 Defendant again sent the similar letter dated M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 4 of 68 CS Comm 192/2019 06.12.2013 which was replied by plaintiff vide his letter dated 14.12.2013 elaborating the fact that the work was going on and the work at road no. D-3 to D-9 Green Park, D-1 to D-2, R-1 and A/2A block had already been completed.
3.8 Defendant suo-moto extended the target date of completion of work from 06.04.2014 to 30.04.2014 vide his letter dated 09.04.2014.
3.9 Plaintiff was financially crippled as despite requests of the plaintiff, defendant was not paying the amount of more than Rs.2.00 crore for the work(s) done by the plaintiff in other projects of the defendant.
3.10 In the series of his malafide intentions defendant wrote another letter dated 09.04.2014 to the plaintiff stating that more than 50% work was still remaining and asked the plaintiff to explain reasons of delay. Plaintiff replied to the said letter on 25.04.2014 stating that the work was being delayed for non-payment of dues by the defendant and that the design mix formula was got approved by the defendant only on 20.03.2014.
3.11 Defendant also issued notice dated 15.04.2014 under Clause 2 of the agreement and Clause 23 of enlistment rules calling upon the plaintiff to show cause why the compensation penalty of 10% be not imposed upon him for delay in execution of work. Plaintiff replied the said show cause vide letter dated 25.04.2014 informing that he had completed more than M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 5 of 68 CS Comm 192/2019 50% of the work and delay was attributable to the defendant for non-release of funds and for delay in approval of design mix formula.
3.12 Vide letter dated 28.04.2014 Superintendent Engineer called the plaintiff for meeting/personal hearing. Plaintiff met with Superintendent Engineer (SE) on 06.05.2014. In the said meeting Superintendent Engineer ensured the plaintiff that all due payments of the plaintiff for all works under the said division would be released to him immediately.
3.13 Samples of the work performed by plaintiff were collected on 08.05.2014 and got tested from Shriram Laboratory. Plaintiff was not informed about report of the laboratory and plaintiff believed that all samples passed as per requirement.
3.14 On 19.05.2014 defendant again suo-moto extended the contract date of completion of work from 30.04.2014 to 15.06.2014.
3.15 Instead of releasing payments to the plaintiff as per assurance given by SE in the meeting dated 06.05.2014, defendant issued letter dated 22.05.2014 informing the plaintiff that his bills were prepared but could not be passed due to certain formalities on the part of plaintiff. Plaintiff immediately contacted office of defendant and was informed by account section that there was no formality pending on the part of plaintiff and that payment would be released in due course after M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 6 of 68 CS Comm 192/2019 sometime. The payment was however not released.
3.16 On 18.06.2014 defendant again suo-moto extended the target date of completion from 15.06.2014 to 15.07.2014. Thereafter it was further extended vide order dated 11.07.2014 from 15.07.2014 to 31.07.2014. On 03.07.2014, report dated 22.05.2014, of the samples collected on 08.05.2014, from Shriram Laboratory was intimated to the plaintiff pointing out some defects which were immediately rectified by the plaintiff. The said rectification was recorded by the defendant in the measurement book.
3.17 Defendant was prejudiced against the plaintiff and therefore issued a circular dated 14.07.2014 thereby debarring and black listing the plaintiff from further participating in tender process of SDMC for a period of 05 years alleging non-execution of work as per terms and conditions. Defendant alleged that the work was not satisfactory as some test reports failed, though defendant had submitted test reports to the MCD lab which were passed. However, to avoid any controversy plaintiff executed work as per instructions of defendant and samples were again taken on 21.08.2014 which also passed in the lab. It is therefore stated that the contention of defendant that work was not executed properly is incorrect, specially when the defendant had himself recorded on the bills that the work has been executed as per specifications.
M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 7 of 68 CS Comm 192/2019 3.18 Plaintiff filed a writ petition (Civil) No. 7179/2014 before Hon'ble High Court challenging the circular of defendant dated 14.07.2014, debarring plaintiff from tendering with SDMC.
3.19 Defendant had granted extension of time ultimately upto 30.11.2014 but the plaintiff completed the work on 23.08.2014 i.e. 3 ¼ months before the target date of completion fixed by the defendant to the entire satisfaction of the defendant.
3.20 The writ petition no. 7179/2014 was disposed off by Hon'ble High Court on 16.01.2015 by setting- aside circular dated 14.07.2014. It was held by Hon'ble High Court that the plaintiff had responded to the show cause notice dated 15.04.2014 explaining that he was financially constrained as more than Rs.2.00 crores was due and payable to the plaintiff by SDMC was not released to him.
3.21 Despite requests from the plaintiff, defendant did not release his payments and plaintiff was constrained to send the letter dated 23.01.2015 requesting the defendant to release payment otherwise the plaintiff would be constrained to take recourse to legal proceedings against the defendant.
3.22 Defendant got annoyed and sent a letter dated 11.02.2015 stating that competent authority vide order dated 20.05.2014 has approved penalty of 10% of the contractual amount against the plaintiff due to delay in M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 8 of 68 CS Comm 192/2019 the work. Plaintiff was thus ordered to deposit the amount of Rs.13,38,722/- for penalty under clause 2 for having unnecessarily delayed the work.
3.23 Aggrieved by the order dated 11.02.2015, plaintiff again approached the Hon'ble High Court of Delhi by filing a writ petition no. 1683/2015 which was disposed off on 26.02.2018.
3.24 On 14.03.2016, defendant suo-moto prepared the final bill and released payment to the plaintiff on 14.03.2016 after arbitrarily deducting a sum of Rs.13,38,722/- on account of alleged compensation under clause 2 of the agreement.
3.25 On 07.04.2018, plaintiff filed LPA no. 185/2018 against the order dated 26.02.2015 in writ petition no. 1683/2015. The said LPA was disposed off on 10.04.2018 with directions to approach the civil court or appropriate forum in accordance with law within four weeks from the date of order. Hon'ble High Court further held that the time spent between filing of the writ petition and till 10.04.2018 shall be reckoned and excluded under section 14 of the Limitation Act.
3.26 Thereafter, plaintiff served legal notice dated 07.05.2018 to the defendant in compliance of section 478 of The Delhi Municipal Corporation Act, 1957 and section 80 Code of Civil Procedure calling upon the defendant to pay a sum of Rs.18,49,270/- inclusive of Rs.13,38,722/- towards withheld amount and M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 9 of 68 CS Comm 192/2019 Rs.5,10,548/- towards interest @ 12% per annum w.e.f. 05.03.2015 till the date of said notice. Defendant failed to comply the notice. Hence, the present suit.
3.27 In his plaint, plaintiff has specified three claims which are as follows:-
Claim No.1:- Plaintiff seeks declaration that the actions taken by the defendant under clause 2 of the contract against the plaintiff vide its letter dated 20.05.2014 and 11.02.2015 were bad, illegal and the same were not in order.
Claim No.2:- Plaintiff claims recovery of a sum of Rs.19,33,775/- (Rupees nineteen lakh thirty three thousand seven hundred and seventy five only) including Rs.13,38,722/- towards principal amount plus Rs.5,95,053/- towards interest @ 12% per annum on the principal amount from 05.03.2015 to 15.11.2018 on account of illegal recovery in the final bill under clause 2 of the agreement.
Claim no.3:- Plaintiff claims a sum of Rs.2,59,921/- (Rupees two lakh fifty nine thousand nine hundred twenty one only) (Rs.1,81,885/- towards principal and Rs.80,847/- towards interest upto 15.11.2018) on account of reimbursement under clause 10CA of the agreement.
3.28 Plaintiff has alleged that imposition of penalty vide its letter dated 20.05.2014 and 11.02.2015 were bad, illegal and contrary to the judgments of M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 10 of 68 CS Comm 192/2019 Hon'ble high Courts and Hon'ble Supreme Court of India. It is alleged that the defendant did not keep the time as essence of the contract and the plaintiff had duly completed the work on 23.08.2014 i.e. much prior to the extended contract period upto 30.11.2014. It is also alleged that the defendant was well aware of the delay and latches caused by himself and therefore from time to time suo-moto extended contract period. Recovery of the penalty amount of Rs.13,38,722/-, deducted from the bills of the plaintiff is therefore claimed along with interest. In addition thereto plaintiff has also claimed amount of Rs.1,81,885/- along with interest under clause 10CA of the agreement due to variation in price of material on account of delay.
WRITTEN STATEMENT
4. Defendants were served with summons of the suit and filed a common written statement.
4.1 In the written statement, defendant took preliminary objection that the suit is barred by limitation as the subject matter of the suit was duly communicated to the plaintiff vide letter dated 11.02.2015 and therefore, the suit could have been filed on or before 10.02.2018 and further that as per order dated 10.04.2018 passed by Hon'ble Delhi High Court in LPA No. 185/2018, the plaintiff could have approached the civil courts within four weeks time, whereas the present suit has been filed M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 11 of 68 CS Comm 192/2019 much after lapse of four weeks time.
4.2 Further preliminary objections that the suit is devoid of material particulars, the amount claimed by the plaintiff is barred by the provisions of the agreement, plaintiff has not submitted any final bill against clause-7 of the agreement, the suit is barred because no proper legal notice under Section 478 of The Delhi Municipal Corporation Act, 1957 has been served and that there is no clause of action are also taken.
4.3 In reply on merits, defendant has not denied the award of work tender to the plaintiff or the written communications between the parties as referred to by the plaintiff in his plaint. It is stated that there was total delay of 215 days in completion of the work and such delay was solely attributed to the plaintiff. It is also stated that Sh. Nitin Jain is one the partners and son of another partner of the plaintiff firm who was appointed as project engineer and an intimation letter dated 03.10.2013 was sent to the defendant, which reflects malafide of the plaintiff. It is also stated that Sh. Nitin Jain had never contacted defendant no. 2 nor to any other concerned official nor commenced the work till 20.03.2014.
4.4 It is further stated that to expedite the work, defendant had already got the job mix formula approved and the plaintiff was asked to immediately commence the work as per the said formula. Letters dt. 20.11.2013 M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 12 of 68 CS Comm 192/2019 and 06.12.2013 were also written to the plaintiff, however, plaintiff did not start the work. It is also stated that the job mix formula was valid upto 01.01.2014 and the stipulated date of start of work was 07.10.2013, therefore, more than 60% of the work should have been completed by 01.01.2014, if the plaintiff had commenced the work as per the terms of the agreement. It is also stated that there was no necessity for any other job mix formula because a duly approved job mix formula was available and the work could have been not only commenced but entire work could have been completed as per the said formula. It is also stated that there was no need to change to a new formula during the pendency of the work. It is also stated that the site was handed over to the plaintiff on 28.09.2013 but the plaintiff did not commence the work, therefore, entire delay was attributed to the plaintiff. It is also stated that the new job mix formula was got done at the instance of plaintiff and because the due date of earlier formula had lapsed but plaintiff had not commenced the work. It is denied that there was any delay on part of the defendants or that the defendants failed in performing any of their contractual or other obligations.
4.5 It is also stated that whenever job mix formula is not available, same is got prepared from material provided by the contractor and for this purpose, the material is sent to laboratory, where the material is M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 13 of 68 CS Comm 192/2019 tested and formula is drawn. All this takes sometime and plaintiff was well aware of this procedural formality and this was one of the reason to give a period of 6 months to complete the scheduled work. It is also stated that had the plaintiff immediately completed the work on the job mix formula already available with the defendant, plaintiff would have easily completed the work well before time.
4.6 It is also stated that the plaintiff could not commence the work because of lack of resources and to avoid imposition of penalty it started blaming the defendant for his own wrongs. It is also stated that the letters dt. 20.11.2013 and 06.12.2013 were rightly and properly sent to the plaintiff as it failed to commence the work despite requests of the defendant. The averment in the plaint that the work had commenced prior to 24.11.2013 is denied and it is stated that sufficient quantity of the bitumen was available since 06.10.2013 but the same was received by plaintiff only on 20.03.2014 to commence the work which is duly proved from the bitumen register, site register, load register, road- roller statement, tack coat test and gate pass etc., which all clearly show that work was done on 20.03.2014 to 11.11.2014. It is repeated that the entire delay was on the part of plaintiff.
4.7 Writing of any letter by the defendant to the plaintiff with malafide intention is denied and it is stated M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 14 of 68 CS Comm 192/2019 that plaintiff is estopped from blaming that he was not being paid any amount and for that reason he could not complete the work, because the plaintiff was required to submit running account bills for any payment and such bills were never submitted by the plaintiff. It is also stated that even otherwise any other work, executed by the plaintiff under the jurisdiction of defendants, does not ipso facto entitle the plaintiff to claim benefit in the work under question, and that even for this work also, the plaintiff has not submitted the bills. It is denied that the plaintiff did not complete the work because it was financially crippled or that there was delay in approval of design mix formula and it is repeated that the design mix was available even prior to award of the work to the plaintiff and the new formula was also made available on 20.03.2014, but plaintiff had time and again stopped the work for no reasons at all. It is also stated that the show cause dated 15.04.2014 was issued to the plaintiff under clause-2 of the agreement. It is denied that plaintiff was put to any financial pressure by the defendant. It is denied that there was any question of giving any assurance by the superintending engineer on 06.05.2014 for release of payments for all works done by the plaintiff under his division, as alleged in para-24 of the plaint and it is stated that plaintiff is malafidely trying the twist the fact. It is also stated that the alleged non- payment can be of no help to the plaintiff to not to M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 15 of 68 CS Comm 192/2019 execute the work in question because payment could have been made only if the plaintiff had submitted running account bills in proper manner as per terms of the agreement. It is also stated that the quality test were done by the third party and the test report were meant for taking action by the defendant. The work executed by the plaintiff is stated to be not satisfactory and it is stated that all the discrepancies were immediately brought to the notice of the plaintiff. Plaintiff is stated to be well aware of the yearly phenomena of falling of temperature during the months of December and January and therefore, under an obligation to plan the work in such manner as to complete the same well within time. It is also stated that if the plaintiff was aware that the work could not be executed below 10 degree temperature, it should have taken objections at the first instance and not when the defects in the work were pointed out by the third party.
4.8 It is further stated that provisional extension of time were always given in the interest of work, and while granting all provisional extensions of time, defendants reserved their right to take action against the plaintiff and plaintiff did not object to the same. It is therefore, stated that there was a deemed acceptance of all provisional extensions by the plaintiff subject to reserving the right to take action by the defendants. It is denied that plaintiff immediately rectified the defects. It M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 16 of 68 CS Comm 192/2019 is denied that defendant was prejudiced against the plaintiff or for that reason they had issued the circular dated 14.07.2014. It is stated that action against the plaintiff was taken as per records after considering all the facts of the matter. All defects pointed to the plaintiff are stated to be based on third party inspection, in addition to inspections done by the senior officer of the defendant. It is also stated that only one bill was prepared for entire work by the defendant after the work was completed, whereas the defects pointed out by the defendant were rectified prior to the preparation of the bill.
4.9 It is denied that the work was completed before the target date or that the same was satisfactory and it is stated that there were so many defects which were later on rectified by the plaintiff. It is repeated that there was total delay of 215 days solely and exclusively attributable to the plaintiff. The final bill for gross amount of Rs. 1,20,48,499/- (Rupees one crores twenty lakh forty eight thousand and four hundred and ninety nine only), prepared by the defendant, is stated to have been happily accepted by the plaintiff and defendant is stated to have made payment of Rs. 97,81,328/-(Rupees ninety lakhs eighty one thousand three hundred and twenty eight only) through RTGS on 10.03.2016.
4.10 It is stated that the penalty was imposed and approved by the superintending engineer under clause-2 M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 17 of 68 CS Comm 192/2019 of the agreement after considering all facts of the case and without any malafide or wrong doing. It is also stated that the imposition of penalty was challenged by the plaintiff by filing Writ Petition (Civil) No. 1683/2015 which was dismissed by Hon'ble Delhi High Court and LPA no. 185/2018 filed against the said judgment was also dismissed as withdrawn on 10.04.2018 with liberty to approach the Civil Courts within 4 weeks. It is denied that the defendant acted illegally or against the principles of natural justice in preparing final bill or by taking any other action against the plaintiff. It is also denied that the Executive Engineer had tampered with the measurement book or any other documents. It is stated that immediately on completion of work, the plaintiff was required to serve a notice of completion of work upon the defendant no.2 but no such notice was ever served. The work is stated to have been actually completed on 11.11.2014. It is also stated that notice dt. 07.05.2018 has not been served by the plaintiff as per provisions of Section 478 of DMC Act, 1957.
4.11 In reply to the claims of the plaintiff for declaration of the letter dated 11.02.2015 as bad and illegal, and for recovery of penalty imposed vide that letter dt. 11.02.2015, it is again stated that the plaintiff did not commence the work and letter dt. 20.11.2013 was written to the plaintiff to commence the work. Vide his letter dated 24.11.2013 plaintiff assured to commence M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 18 of 68 CS Comm 192/2019 the work, however, failed in its commitment and therefore, vide letter dt. 06.12.2013 plaintiff was once again requested by Engineer Incharge to immediately commence the work. Pursuant thereto plaintiff commenced some minor work but after executing about 5% work it stopped the work for no reason. Under the circumstances, Engineer Incharge vide letter dated 31.12.2023 again requested the plaintiff to resume the work, the plaintiff however cited lame excuse of low temperature and did not resume the work. It is repeated that plaintiff was well aware about the fall of temperature in Northern India in the months of December and January and was therefore required to plan work in appropriate manner. It is stated that thereafter the plaintiff resumed the work on 22.03.2014 and all this period was absolutely wasted by the plaintiff. It is also stated that after executing about 50% of the work, the plaintiff again stopped the work and therefore, Engineer Incharge, vide his letter dated 09.04.2014 again requested the plaintiff to immediately resume the work. The plaintiff, however, did not resume the work and a show cause notice dt. 15.04.2014 was issued to the plaintiff under clause-2 of the agreement. Thereafter, vide letter dt. 28.04.2014 plaintiff was given an opportunity of personal hearing on 01.05.2014. Plaintiff showed his non-availability to come on 01.05.2014, therefore, the meeting was rescheduled on 06.05.2014. M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 19 of 68 CS Comm 192/2019 On 06.05.2014 plaintiff attended the office of Superintendent Engineer and submitted that it was running short of funds. It requested the officers of the defendant to release amount against some other work done by it. It is again stated that the plaintiff had never raised any running account bill for the work in question and therefore, there was no occasion for the defendants to pay or not to pay the same. It is stated that the defendants always had sufficient funds to pay to the plaintiff but the plaintiff did not fulfill his obligations to submit bills during pendency of the work. Non-payment of money in some other work is stated to be no reason for not executing the work in question. It is stated that it was for the plaintiff to have properly arrnaged its work in a manner that it could secure full finances to execute the work in question. It is also stated that in the meeting dt. 06.05.2014 plaintiff was clearly told that if it failed in executing the work, action would be taken against it. Pursuant thereto plaintiff resumed the work on 06.05.2014 but after partialy executing the same it once again stopped the same. Thereafter, plaintiff resumed the work and completed the same on 11.11.2014. It is stated that on completion of work plaintiff was required to serve a notice upon the defendant no. 2 but no such notice was ever served and that there were number of deficiencies in the work. It is also stated that plaintiff was required to prepare and submit the final bill but it M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 20 of 68 CS Comm 192/2019 failed in doing so. It is also stated that only reason cited by the plaintiff for delay in completing the work is delay in approval of job mix formula, however, it is an admitted fact that at the time of award of work the defendant had an approved job mix formula and requested the plaintiff to immediately commence the work. Further, the job mix formula was again got approved on 20.03.2014 but even thereafter, the plaintiff stopped the work and did not resume the same for months together. Thus it is repeated that the entire responsibility for delay in completing was upon the plaintiff and he is not entitled to any relief. It is repeated that all provisional extensions of time were subject to defendant's right to take action against the plaintiff as per the terms of the agreement. If the plaintiff had any grievance it could have abandoned the work at the first instance and had lodged its protest with the competent authority. The show cause notice dt. 15.04.2014 and the action taken by the defendant is stated to be proper. Dismissal of the claims for declaring the letter dt. 11.02.2015 as bad and illegal and the claim for recovery of the penalty amount is prayed.
4.12 In respect of the claim of Rs. 2,59,921/- under clause-10 CA of the agreement it is stated that the plaintiff has been paid entire due amount and nothing is left to be paid to it. It is also stated that the entire delay is caused due to inaction of plaintiff and further no amount M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 21 of 68 CS Comm 192/2019 under this claim was ever raised by the plaintiff during execution of the work nor plaintiff ever submitted any bill under clause-10 CA. This claim is thus stated to be an afterthought.
4.13 It is stated that LPA No. 185/2018 was dismissed as withdrawn on 10.04.2018 and only 4 weeks time was granted to the plaintiff to approach the Civil Court or appropriate Forum as per law, whereas the present suit has been filed much after that, and therefore, no benefit of the aforesaid liberty can be given to the plaintiff. The suit is thus stated to be barred by limitation and dismissal of suit is prayed.
REPLICATION
5. Plaintiff filed replication to the written statement thereby reiterating the facts stated in the plaint and denying contrary allegations of the written statement.
ISSUES
6. Vide order dated 09.07.2019 of my Learned Predecessor, following issues were framed by my learned predecessor :-
1) Whether the suit is barred by limitation? OPD
2) Whether the suit is not maintainable for the want of proper notice to defendants under Section 478 DMC Act, 1957 ? OPD M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 22 of 68 CS Comm 192/2019
3) Whether the plaintiff is entitled to decree of recovery of suit amount against the defendants? OPP
4) Whether plaintiff is entitled to any interest, if so, on what amount, at which rate and for which period ? OPP
5) Whether plaintiff is entitled to declaration, as prayed for ? OPP
6) Relief.
EVIDENCE
7. Sh. Nitin Jain, registered partner of plaintiff firm filed his affidavit in evidence and examined himself as PW-1. He relied upon following documents:-
i)Ex.PW1/1(OSR) is Form A of plaintiff firm.
ii)Ex.PW1/2 (OSR) is Form B of plaintiff firm.
iii) Ex.PW1/3 is de-exhibited and marked as Mark A. It is the photocopy of letter dated 02.01.2013.
iv) Ex.PW1/4 (OSR) is the photocopy of letter dated 11.09.2013.
v) Ex.PW1/5 is the letter dated 28.09.2013.
vi) Ex.PW1/6 (OSR) is the photocopy of the first running bill.
vii) Ex.PW1/7 is the letter dated 03.10.2013.
viii) Ex.PW1/8 is the letter dated 20.11.2013.
ix) Ex.PW1/9 is the letter dated 24.11.2013.
x) Ex.PW1/10 is the postal receipt qua Ex.PW1/9.
xi) Ex.PW1/11 is the letter dated 06.12.2013.
M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 23 of 68 CS Comm 192/2019
xii) Ex.PW1/12 is the letter dated 14.12.2013.
xiii) Ex.PW1/13 (OSR) is the photocopy of letter dated 10.01.2014.
xiv) Ex.PW1/14 is de-exhibited and now marked as Mark B. It is the photocopy of demand draft dated 10.01.2014.
xv) Ex.PW1/15 is the letter dated 05.02.2014. xvi) Ex.PW1/16 is the original measurement book. xvii) Ex.PW1/17 (colly.) was de-exhibited and marked as Mark C as the same was photocopy of the Test Report (Job-Mix Formula).
xviii) Ex.PW1/18 is the letter dated 09.04.2014. xix) Ex.PW1/19 is the letter dated 09.04.2014. xx) Ex.PW1/20 is the envelope of Ex.PW1/19. xxi) Ex.PW1/21 is the letter dated 15.04.2014. xxii) Ex.PW1/22 is the envelope of Ex.PW1/21 xxiii) Ex.PW1/23 is the letter dated 25.04.2014. xxiv) Ex.PW1/24 i.e. the postal receipt was de- exhibited and marked as Mark G. xxv) Ex.PW1/25 is the letter dated 28.04.2014. xxvi) Ex.PW1/26 is the envelope.
xxvii) Ex.PW1/27 is de-exhibited and marked as Mark I. It is the photocopy of letter dated 28.04.2014.
xxviii) Ex.PW1/28 (OSR) is the photocopy of noting dated 06.05.2014.
xxix) Ex.PW1/29 (OSR) is the photocopy of noting dated 06.05.2014.
M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 24 of 68 CS Comm 192/2019 xxx) Ex.PW1/30 is the letter dated 19.05.2014. xxxi) Ex.PW1/31 is the letter dated 18.06.2014. xxxii) Ex.PW1/32 is the envelope.
xxxiii) Ex.PW1/33 (OSR) is the photocopy of test report dated 22.05.2014.
xxxiv) Ex.PW1/34 (OSR) is the photocopy of test report dated 29.09.2014.
xxxv)Ex.PW1/35 is the letter dated 22.05.2014. xxxvi)Ex.PW1/36 is the envelope.
xxxvii)Ex.PW1/37 is the letter dated 11.07.2014. xxxviii)Ex.PW1/38 is the envelope.
xxxix)Ex.PW1/39 is the circular dated 14.07.2014. xl)Ex.PW1/40 is the envelope.
xli)Ex.PW1/41 is the letter dated 05.08.2014. xlii)Ex.PW1/42 is envelope.
xliii)Ex.PW1/43 is letter dated 10.10.2014. xliv)Ex.PW1/44 is letter dated 30.10.2014. xlv)Ex.PW1/45 is the envelope.
xlvi)Ex.PW1/46 is certified copy of judgment dated 16.01.2015.
xlvii)Ex.PW1/47 is letter dated 23.01.2015. xlviii)Ex.PW1/48 is postal receipt.
xlix)Ex.PW1/49 is letter dated 11.02.2015.
l)Ex.PW1/50 is envelope.
li)Ex.PW1/51 is certified copy of order dated 23.02.2015.
lii)Ex.PW1/52 is original bank statement of M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 25 of 68 CS Comm 192/2019 R.K.Goel and Abhay Kumar Jain.
liii)Ex.PW1/53 (colly.) are de-exhibited and marked as Mark F. These are orders dated 26.02.2018 and 10.04.2018 passed by Hon'ble High Court.
liv)Ex.PW1/54 is notice dated 07.05.2018 under Section 478 r/w Section 80 of CPC.
lv)Ex.PW1/55 is postal receipt of Ex.PW1/54. lvi)Ex.PW1/56 is postal receipt of Ex.PW1/54. lvii)Ex.PW1/57 is de-exhibited and marked as Mark H. It is photocopy of circular dated 06.07.2015.
lviii)Ex.PW1/58 (OSR) is letter dated 03.10.2013. lix)Ex.PW1/59 is de-exhibited and marked as Mark D. It is photocopy of postal receipt.
lx)Ex.PW1/60 is letter dated 31.12.2013. lxi)Ex.PW1/61 is envelope.
lxii)Ex.PW1/62 (OSR) is letter dated 03.01.2014. lxiii)Ex.PW1/63 is de-exhibited and marked as Mark E. It is photocopy of postal receipt.
8. Sh. Arun Kumar Garg, Assistant Engineer (Project), SDMC, under Bhism Pitamah Flyover, Sewa Nagar, New Delhi is PW2 who brought the summoned record related to the work no.EE (PROJECT)South-1 SYS/2013-2014/6 dated 28.09.2013. He compared and proved the following documents with the original records brought by him.
i) Ex.PW1/4 (OSR) is the photocopy of letter M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 26 of 68 CS Comm 192/2019 dated 11.09.2013.
ii) Ex.PW1/5 is the letter dated 28.09.2013.
iii) Ex.PW1/6 (OSR) is the first running bill.
iv) Ex.PW1/13 (OSR) is letter dated 10.01.2014.
v) Ex.PW1/15(OSR) is the letter dated
05.02.2014.
vi) Ex.PW1/16 (colly.) is the original
measurement book.
Vii) Ex.PW1/23(OSR) is the letter dated
25.04.2014.
iii) Ex.PW1/28 (OSR) is the noting dated 06.05.2014. The handwritten portion on the exhibit in blue ink is not part of the MCD record.
ix) Ex.PW1/29 (OSR) is the noting dated 06.05.2014.
x) Ex.PW1/33 (OSR) is the test report dated 22.05.2014.
xi) Ex.PW1/34 (OSR) is test report dated 29.09.2014.
xii) Ex.PW1/57 is photocopy of circular dated 06.07.2015.
xiii) Ex.PW1/58 is de-exhibited and is marked as Mark H. It is letter dated 03.10.2013.
xiv) Ex.PW1/62 (OSR) is letter dated 03.01.2014.
9. Sh. Ajay Kumar Aggarwal, Executive Engineer Project-1, South Zone, SDMC filed his affidavit in M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 27 of 68 CS Comm 192/2019 evidence and examined himself as DW-1. He relied upon the following documents :-
i) Award letter dated 28.09.2013 has already been exhibited as Ex.PW1/5.
ii) Letter dated 20.11.2013 has already been exhibited as Ex.PW1/8.
iii) Letter dated 24.11.2013 has already been exhibited as Ex.PW1/9.
iv) Letter dated 06.12.2013 has already been exhibited as Ex.PW1/11.
v) Letter dated 31.12.2013 has already been exhibited as Ex.PW1/60.
vi) Letter dated 06.04.2014 has already been exhibited as Ex.PW1/19.
vii) Show cause notice dated 15.04.2014 has already been exhibited as Ex.PW1/20.
viii) Letter dated 28.04.2014 has already been exhibited as Ex.PW1/25.
ix) Letter dated 11.02.2015 has already been exhibited as Ex.PW1/49.
x) Measurement book no.3723 has already been exhibited as Ex.PW1/16.
xi) Noting sheets dated 06.05.2014 has already been exhibited as Ex.PW1/28.
10. All the three witnesses were cross-examined in detail by learned counsels of the opposite party. M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 28 of 68 CS Comm 192/2019 ARGUMENTS
11. Final arguments were addressed by learned counsels for both the parties at length.
12. Sh. Bhupesh Narula, Ld. Counsel for plaintiff has drawn attention to the Court to the impugned letter dated 11.02.2015 and submitted that the defendant had wrongly attributed entire responsibility of delay in work upon the plaintiff. He also argued that the defendant did not record the work done by the plaintiff immediately after award of the contract. He has drawn attention of the Court of the work order dated 28.09.2013 Ex. PW1/5 for the work in question. The work order appears to have been issued by Executive Engineer and the measurement book no. 3440 is mentioned on the top portion of the work order. Sh. Bhupesh thus submitted that initially measurement book No. 3440 was issued for recording of the work done by the plaintiff but the said measurement book was never produced before the Court. He also argued that with malafide intention, defendant got issued another measurement book no. 3723 on 13.03.2014 and started recording the work with effect from 20.03.2014. He further argued that as per the terms and conditions mentioned in the measurement book the entries made by the pencils could not have been rubbed but the original measurement book no. 3723 Ex.PW1/16 reflects that the officials of defendant have rubbed many dates M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 29 of 68 CS Comm 192/2019 recorded/written by pencil in the measurement book. He argued that an adverse inference should be drawn against the defendant as the document i.e. the measurement book Ex. PW1/16 was in the custody of the officers of the defendant and the same has been tampered with to the prejudice of plaintiff.
13. Per contra, Sh. Anupam Sharma, Ld. Counsel for defendant argued that entire claim of the plaintiff is false and that the defendant has rightly taken action of imposing penalty under clause-2 of the agreement between the parties by virtue of letter dated 11.02.2015, because entire delay in completion of the work is attributable to the plaintiff. Sh. Sharma, submitted that the defendant had written letters after letters to call upon the plaintiff to commence and complete the work, but the plaintiff failed to do so. Sh. Sharma, thus argued that under these compelling circumstances created by the plaintiff by delaying public work, the defendant was constrained to take action under clause-2 of the agreement. Sh. Sharma, further argued in the lines of the stand taken by the defendant in its written statement submitting that the suit is barred by limitation and that the plaintiff is not entitled to any relief.
14. Arguments considered and record perused.
FINDINGS
15. Issue-wise findings of the Court are as under :-
M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 30 of 68 CS Comm 192/2019 Issue No.1 :- Whether the suit is barred by limitation ? OPD
16. Onus to prove this issue was upon the defendant.
In reiteration of the stand taken in written statement, Ld. Anupam Sharma, submitted that the decision of imposition of penalty of Rs. 13,38,722/- was duly intimidated to the plaintiff on 11.02.2015, hence, the suit could have been filed within 3 years after 11.02.2015 i.e. upto 10.02.2018. He thus argued that suit is barred by limitation. He further argued that the plaintiff did not comply with the directions passed by Hon'ble Delhi High Court in LPA No. 185/2018 and no benefit under Section 14 of the Limitation Act can be availed by the plaintiff as plaintiff did not file the present suit before Civil Court within the period of 4 weeks granted by the Hon'ble High Court while disposing off LPA No. 185/2018 on 10.04.2018.
17. In support of their rival contentions, learned counsels for both the parties referred to and relied upon following provisions of law:-
Section 478 of The Delhi Municipal Corporation Act, 1957 provides as under:-
478. Notice to be given of suits - (1) No suit shall be instituted against the Corporation or against any municipal authority or against any municipal officer or other municipal employee or against any M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 31 of 68 CS Comm 192/2019 person acting under the order or direction of any municipal authority or any municipal officer or other municipal employee, in respect of any act done, or purporting to have been done, in pursuance of this Act or any rule, regulation or bye-law made thereunder until the expiration of two months after notice in writing has been left at the municipal office and, in the case of such officer, employee or person, unless notice in writing has also been delivered to him or left at his office or place of residence, and unless such notice states explicitly the cause of action, the nature of the relief sought, the amount of compensation claimed, and the name and place of residence of the intending plaintiff, and unless the plaint contains a statement that such notice has been so left or delivered.
(2) No suit, such as is described in sub-section (1), shall unless it is a suit for the recovery of immovable property or for a declaration of title thereto, be instituted after the expiry of six months from the date on which the cause of action arises.
(3) Nothing in sub-section (1) shall be deemed to apply to a suit in which the only M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 32 of 68 CS Comm 192/2019 relief claimed is an injunction of which the object would be defeated by the giving of the notice or the postponement of the institution of the suit.
Section 42 of The Delhi Municipal Corporation Act, 1957 provides as under:-
42. Obligatory functions of the Corporation - Subject to the provisions of this Act and any other law for the time being in force, it shall be incumbent on the Corporation to make adequate provision by any means or measures which it may lawfully use or take, for each of the following matters, namely:--
........
(n) the construction, maintenance, alteration and improvements of public streets, bridges, culverts, causeways and the like;
(o) the lighting, watering and cleansing of public streets and other public places;
.......
Section 80 of The Code of Civil Procedure 1908 provides as under:-
M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 33 of 68 CS Comm 192/2019
80. Notice [(1)] Save as otherwise provided in sub-section (2), no suits shall be instituted against the Government (including the Government of the State of Jammu and Kashmir) or against a public officer in respect of any act purporting to be done by such public officer in his official capacity, until the expiration of two months next after notice in writing has been delivered to, or left at the office of--
(a) in the case of a suit against the Central Government, except where it relates to a railway a Secretary to that Government;
(b) in the case of a suit against the Central Government where it relates to railway, the General Manager of that railway;
[(bb) in the case of a suit against the Government of the State of Jammu and Kashmir, the Chief Secretary to that Government or any other officer authorized by that Government in this behalf;]
(c) in the case of a suit against any other State Government, a Secretary to that Government or the Collector of the district;
and, in the case of a public officer, M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 34 of 68 CS Comm 192/2019 delivered to him or left at his office, stating the cause of action, the name, description and place of residence of the plaintiff and the relief which he claims; and the plaint shall contain a statement that such notice has been so delivered or left.
[(2) A suit to obtain an urgent or immediate relief against the Government (including the Government of the State of Jammu and Kashmir) or any public officer in respect of any act purporting to be done by such public officer in his official capacity, may be instituted, with the leave of the Court, without serving any notice as required by sub-section (1); but the Court shall not grant relief in the suit, whether interim or otherwise, except after giving to the Government or public officer, as the case may be, a reasonable opportunity of showing cause in respect of the relief prayed for in the suit:
PROVIDED that the Court shall, if it is satisfied, after hearing the parties, that no urgent or immediate relief need be granted in the suit, return the plaint for presentation to it after complying with the requirements of sub-section (1).
M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 35 of 68 CS Comm 192/2019 (3) No suit instituted against the Government or against a public officer in respect of any act purporting to be done by such public officer in his official capacity shall be dismissed merely by reason of any error or defect in the notice referred to in sub-section (1), if in such notice--
(a) the name, description and the residence of the plaintiff had been so given as to enable the appropriate authority or the public officer to identify the person serving the notice and such notice had been delivered or left at the office of the appropriate authority specified in sub-
section (1), and
(b) the cause of action and the relief claimed by the plaintiff had been substantially indicated.] Section 14 of The Limitation Act 1963:-
14. Exclusion of time of proceeding bona fide in court without jurisdiction.
(1) In computing the period of limitation for any suit the time during which the plaintiff has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 36 of 68 CS Comm 192/2019 revision, against the defendant shall be excluded, where the proceeding relates to the same matter in issue and is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it.
(2) In computing the period of limitation for any application, the time during which the applicant has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against the same party for the same relief shall be excluded, where such proceeding is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it.
(3) Notwithstanding anything contained in rule 2 of Order XXIII of the Code of Civil Procedure, 1908 (5 of 1908), the provisions of sub-section (1) shall apply in relation to a fresh suit instituted on permission granted by the court under rule 1 of that Order, where such permission is granted on the ground that the first suit must fail by reason of a defect in the jurisdiction of the court or other cause of a like nature. M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 37 of 68 CS Comm 192/2019 Explanation : For the purposes of this section,--
(a) in excluding the time during which a former civil proceeding was pending, the day on which that proceeding was instituted and the day on which it ended shall both be counted;
(b) a plaintiff or an applicant resisting an appeal shall be deemed to be prosecuting a proceeding; and
(c) misjoinder of parties or of causes of action shall be deemed to be a cause of a like nature with defect of jurisdiction.
Section 15 (2) of The Limitation Act 1963:-
15. Exclusion of time in certain other cases.
(2) In computing the period of limitation for any suit of which notice has been given, or for which the previous consent or sanction of the Government or any other authority is required, in accordance with the requirements of any law for the time being in force, the period of such notice or, as the case may be, the time required for obtaining such consent or sanction shall be excluded.
M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 38 of 68 CS Comm 192/2019 Explanation.--In excluding the time required for obtaining the consent or sanction of the Government or any other authority, the date on which the application was made for obtaining the consent or sanction and the date of receipt of the order of the Government or other authority shall both be counted.
.........
18. The orders passed by Hon'ble High Court of Delhi in Writ Petition (C ) 1683/15 on 26.02.2018 and order passed by Hon'ble High Court in LPA 185/2018 on 10.04.2018 are also relied upon by both the parties.
19. While submitting that the benefit of section 14 of The Limitation Act cannot be given to the plaintiff, learned Sh. Anupam argued that section 14 can be applied only when the applicant/plaintiff could have been prosecuting another civil proceedings against the same party for the same relief in good faith in a court which from defect of jurisdiction or other cause of a like nature, was unable to entertain the said another civil proceedings. Whereas in the present case plaintiff is not claiming same relief in the present suit as was claimed by him in Writ Petition before Hon'ble High Court.
20. In support of his submissions learned Sh. Anupam drew attention of the court to the opening page of the M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 39 of 68 CS Comm 192/2019 order dated 26.02.2018 passed in W.P. (C ) 1683/2015, wherein Hon'ble High Court has quoted the prayer of the plaintiff herein in W.P. (C ) 1683/2015 as follows:-
"It is , therefore, most respectfully prayed that this Hon'ble Court may be pleased to:
(a) issue a writ, order or direction in the nature of certiorari quashing the circular dated 11.02.2015;
(b) Any other or relief as this Hon'ble Court deems fit and proper may be passed in the facts and circumstances of the present case."
21. Learned Sh. Anupam has submitted that in the present case, plaintiff has not claimed the same relief, as sought by him in W.P. (C ) 1683/15. He drew attention of the court to the prayer in plaint which is as follows:-
a) pass a decree in the sum of Rs.21,96,507- (Rs.
Twenty one lakh ninety six thousand five hundred and seven only) in favour of the Plaintiff and against the Defendants and also pendente lite and future interest @ 12% per annum due to losses suffered by the Plaintiff AND
b) Pass declaration that the actions taken by the defendant against the Plaintiff vide its letter dated 20.05.2014 and 11.02.2015 were bad, illegal and the same were not in order
c) Award cost of the suit in favour of the Plaintiff and against the Defendants AND M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 40 of 68 CS Comm 192/2019
d) Pass such order or further order as the court may deem fit and proper in the facts and circumstances of the case in favour of the plaintiff and against the defendants.
22. He therefore submitted that section 14 of The Limitation Act is not applicable for exclusion of time spent by the plaintiff in W.P. (C) 1683/15 and LPA 185/18.
23. Learned Sh. Anupam further argued that exclusion of time under section 14 of The Limitation Act 1963 is available incase the plaintiff was prosecuting the civil proceedings in a court which, from defect of jurisdiction was unable to entertain it. While referring to second para of order dated 10.04.2018 in LPA no. 185/2018, learned Sh. Anupam submitted that the Hon'ble High Court did not opine that W.P. (C ) 1683/15 could not have been entertained by it due to any defect of jurisdiction or other cause of like nature. He submits that bare reading of the order is clear to show that learned counsel for plaintiff had sought liberty to withdraw the appeal and to approach appropriate forum in accordance with law and the appeal was infact dismissed as withdrawn. He therefore argued that it cannot be said said that LPA or the W.P. (C ) was dismissed or was not entertained for the lack of jurisdiction by the Hon'ble High Court. He therefore submitted that benefit of section 14 of The M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 41 of 68 CS Comm 192/2019 Limitation Act 1963 is not available to the plaintiff.
24. Learned Sh. Anupam nextly argued that as per section 42(n) of The Delhi Municipal Corporation Act, 1957, it is statutory obligatory function of the MCD to construct, maintain, alter and/or improve public streets, bridges etc. and the present work was related to the improvement and strengthening of internal public roads by dense carpeting. He thus submitted that work was awarded to plaintiff under the statutory duties of the corporation under The Delhi Municipal Corporation Act, 1957. He thus argued that as per section 478 (2) of The Delhi Municipal Corporation Act, 1957, the limitation period for institution of suit would be six months only from the date on which cause of action arises. He submitted that the present suit, even if the benefit of section 14 of The Limitation Act 1963 is granted to the plaintiff, would be barred by limitation.
25. The court is in prima facie agreement with the submissions of learned Sh. Anupam that benefit of section 14 (1) of The Limitation Act 1963 is available to a party, who has instituted the previous proceedings, if subsequent civil proceedings are filed by the said party against the same defendant with same relief. The court is conscious of the fact that in the present case plaintiff has claimed reliefs of recovery in addition to the relief claimed in W.P. (C) 1683/15. Court is however in agreement with the submissions of learned Sh. Narula M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 42 of 68 CS Comm 192/2019 hat relief for recovery of the penalty amount imposed vide circular dated 11.02.2015 is consequential to the relief of quashing the circular dated 11.02.2015 or to the declaration of that circular as null and void. The penalty was imposed by the defendant through this circular/letter dated 11.02.2015. If the said circular is quashed or declared as null and void, the defendant would not be entitled to recovery of the penalty amount mentioned in the said circular/letter. It is also a necessary consequence that if the defendant had recovered the amount of penalty mentioned in the circular dated 11.02.2015 and the said circular is quashed, set-aside or declared null and void, defendant would be liable to return back the said recovered amount of penalty to the plaintiff.
26. Hence, this court is of the humble opinion that the relief for recovery of amount of penalty, which was actually deducted form the bills of the plaintiff on 13.01.2016 after filing of W.P. (C) No. 1683/15 is consequential of the relief claimed in the W.P. (C) No. 1683/15 and the plaintiff cannot be denied benefit of section 14 of The Limitation Act 1963.
27. Further the Hon'ble High Court has categorically held in its order dated 100.04.2018 that time spent between filing of W.P. (C ) till 10.04.2018, shall be excluded for the purpose of limitation under section 14 of The Limitation Act 1963. This court need not to go into the observations made by Hon'ble High Court prior M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 43 of 68 CS Comm 192/2019 to passing of this effective order. Hence, this court is of the humble opinion that plaintiff is entitled to benefit under section 14 of The Limitation Act 1963. So far as, relief of declaration that letter dated 11.02.2015 is bad and legal is concerned, similarly plaintiff is entitled to benefit of section 14(1) of The Limitation Act 1963 for relief of recovery of the penalty amount of Rs.13,38,722/- deducted by the defendant from the pending bills of the plaintiff by giving effect to the letter dated 11.02.2015.
28. The next question for decision is whether the limitation period of six months as mentioned in section 478 (2) of The Delhi Municipal Corporation Act, 1957 would be applicable to the suit of the plaintiff or ordinary period of limitation of three years would be applicable in the facts and circumstances of the case.
29. It is rightly submitted on behalf of the plaintiff that there is no power or provision in The Delhi Municipal Corporation Act, 1957, authorizing the defendant to impose penalty for alleged delay in work. The pleadings of both the parties substantiate the submissions of both the parties that imposition of penalty was allegedly done by the defendant under the powers derived from the work order and contract agreement allegedly executed between the parties. Hence, cause of action for filing the present suit has arisen out of the contractual obligations of the parties and not necessitated M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 44 of 68 CS Comm 192/2019 from the obligatory functions need to be performed by the defendant under The Delhi Municipal Corporation Act, 1957. If for the performance of the obligatory functions under The Delhi Municipal Corporation Act, 1957, defendant enters into some contract, it has to honour the terms and conditions of the contract. The suit by either party for non-performance of the obligations or terms and conditions of the contract has to be considered a suit arising from the contract and need not be covered under section 478 of The Delhi Municipal Corporation Act, 1957. Reliance in this respect is placed upon judgment passed by Hon'ble Supreme Court in the case of Bombay Housing Board (now the Maharashtra Housing Board) Vs M/s Karbhase Naid and Co., Sholapur AIR 1975 Supreme Court 763. In the said case Hon'ble Supreme Court discussed section 64 of the Bombay Housing Board Act 1958 which was akin to section 478 of The Delhi Municipal Corporation Act, 1957. In the said judgment, it was held that contract entered into by the Bombay Housing Board for construction of buildings might be an act done in pursuance to the provisions of the Act but when a municipality has power to enter into a contract and the municipality purports to exercise its powers to enforce such contract, any act done in exercise of its powers to enforce the contract is not in pursuance to the act but in pursuance to the contract and therefore suit brought M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 45 of 68 CS Comm 192/2019 against the municipality in claiming cost of work done under the contract or for return of deposit under the contract, such suit would not fall within the ambit of section 64 of Bombay Housing Board Act 1958. The Hon'ble Supreme Court approved the findings of Hon'ble High Court of Bombay on the point of limitation and held as follows:-
22. The last point for consideration is whether the suit was barred by limitation as it was not brought within six months of the act complained of.
23. The High Court was of the view that s. 64 of the Bombay Housing Board Act, 1948 has no application as the claims were for damages for breach of contract.
Section 64 provides :
"No person shall commence any suit against the Board or against any officer or servant of the Board or any person acting under the orders of the Board, for anything done or purporting to have been done in pursuance of this Act, with- out giving the Board, officer, or servant or person two months' previous notice in writing of the intended suit and of the cause thereof, nor after six months from the date of the act complained of.
M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 46 of 68 CS Comm 192/2019 And in the case of any such suit for damages, if tender of sufficient amends shall have been made before the action was brought, the plaintiff shall not recover more than the amounts so tendered and shall pay all costs incurred by the defendant after such tender."
24. The appellant submitted that the act of entering into the contract was an act done or purporting to have been done in pursuance of the Act and therefore, any claim for money as damages for breach of the contract by the respondent would come within the purview of the section.
25. The Preamble of the Act provides :
"Whereas it is expedient to take such measures, to make such schemes and to carry out such works as are necessary for the purpose of dealing with and satisfying the need of housing accommodation and with that object in view it is necessary to establish a Board and to make certain other provisions hereinafter appearing; It is hereby enacted as follows."
Section 19 provides that the Board may enter into all such contracts as it may M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 47 of 68 CS Comm 192/2019 consider necessary for carrying out the purposes of the Act. Section 23(1) states that the Board may incur expenditure and undertake works for framing and execution of housing schemes. Section 23(2) says that the government may entrust to the Board the framing and execution of any housing scheme. Therefore, the Board has statutory duty to frame schemes for construction of houses and execute them. Section 24(f) would also indicate that the purpose of a scheme is construction of house. In these circumstances, we think that the contract entered into the Board for construction of buildings might be an act done in pursuance to the provisions of the Act. We will also assume that it makes no difference whether it was deemed to be entered the contract was or whether it wag deemed to be entered 54 of the Act. But the question is whether the act complained of, namely the non-payment of a claim for money based on breach of contract, was an act done or purporting to have been done in pursuance of the Act.
26. There can be no doubt that the act complained of by the respondent was the non-payment of money as damages or M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 48 of 68 CS Comm 192/2019 compensation resulting from an alleged breach of contract.
27. In the Municipal Borough of Ahmedabad v. Jayantilal Chhotalal Patel, ILR (1947) Bom 841 = (AIR 1948 Bom 98) (FB) the Court held that when a municipality has power to enter into a contract under the Municipal Boroughs Act and the municipality purports to exercise its power to enforce such contract, any act done in the exercise of its power to enforce the contract is not in pursuance of the Act but in pursuance to the contract and, therefore, a suit brought against the municipality for return of deposit under a contract to clean the streets was not a suit of the type described in s. 206 of the Bombay Municipal Boroughs Act, 1925 which is in pari materia with section 64 of the Act. In the course of the judgment, Chagla, J. (as he then was) observed that what the plaintiff sought to enforce was, the right which came into existence as a result of the contract entered into between the plaintiff and the municipality and not a public duty cast upon the municipality by the statute, that in forfeiting the deposit, the municipality was M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 49 of 68 CS Comm 192/2019 not acting in pursuance to the power given to 'it under statute but was doing so in pursuance of a power given to it under the contract and, therefore, the suit to enforce rights under the contract entered into with the municipality which the municipality was not under any obligation to enter into, cannot fall with the ambit of the section. We think that the decision lays down the law correctly ,and that the principle deducible from it is applicable to the facts here.
30. In the facts and circumstances, it can be safely said that period of limitation of three years would be applicable to the filing of the present suit arising from the work order/contract duly executed between the parties and restricted period of limitation of six months under section 478 (2) of The Delhi Municipal Act 1957 is not applicable.
31. For the purpose of convenience, the effective portion of the order dated 10.04.2018 passed by Hon'ble Delhi High Court in LPA No. 185/2018 is reproduced herein below :-
"It is clarified that the findings against the petitioner in the order of the learned Single Judge shall not be treated as conclusive or in any manner prejudicial M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 50 of 68 CS Comm 192/2019 to it. In case the petitioner approaches the Civil Court or the appropriate forum in accordance with law, within four weeks from today, the adjudication of its disputes shall be strictly on the merits of the case; rights and contentions of the parties are reserved. Furthermore, the time spent between the filing of the writ petition and till date, shall be reckoned and be excluded for the purposes of limitation under Section 14 of the Limitation Act, 1962."
32. Learned Sh. Bhupesh has rightly submitted that the plaintiff had started taking action for filing the present suit within four weeks after 10.04.2018 i.e. the date of disposal of LPA no.185/2018. It is categorically stated in the plaint and is not denied in the written statement that the plaintiff served a notice dated 07.05.2018 to the defendant under Section 478 of The Delhi Municipal Corporation Act, 1957. The said notice is duly exhibited by the plaintiff as Ex.PW1/54. Postal receipts thereof are Ex.PW1/55 and PW1/56. At the instance of the defendant an specific issue was framed as to whether the suit is not maintainable for proper notice to the defendant under Section 478 of The Delhi Municipal Corporation Act, 1957. Hence, it is the defendant who has emphasized heavily for service of notice under Section 478 of The Delhi Municipal Corporation Act, 1957, prior to filing of the suit. The M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 51 of 68 CS Comm 192/2019 plaintiff was therefore required to serve such notice upon the defendant. It has to be kept in mind that the notice Ex.PW1/54 has been served both under section 478 of The Delhi Municipal Corporation Act, 1957 and section 80 of The Code of Civil Procedure 1908. Even if section 478 of The Delhi Municipal Corporation Act, 1957 was not applicable, the plaintiff was supposed to serve notice under section 80 of The Code of Civil Procedure 1908 to the officers of the defendant who are public officers and the suit against them cannot be filed except by serving prior notice under section 80 of The Code of Civil Procedure. The action for service of the said notice was duly taken by the plaintiff within four weeks of disposal of the LPA no.185/18. Under Section 80 of The Code of Civil Procedure 1908, the civil suit against the Corporation can be filed only after expiry of two months of service of notice upon the Corporation in writing. It is rightly submitted by Learned Sh. Narula that the Order of the Hon'ble High Court could not be read to have exonerated the plaintiff from compliance of statutory notice under Section 80 of The Code of Civil Procedure 1908. Hence service of notice under section 80 of The Code of Civil Procedure 1908 is an step towards the filing of suit. The plaintiff had initiated action for filing of the suit within four weeks by serving notice dated 07.05.2018. Hence, it cannot be said that the plaintiff cannot avail benefit of the Order dated 10.04.2018 M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 52 of 68 CS Comm 192/2019 passed by the Hon'ble High Court in LPA no.185/18. Hence, in humble opinion of this court, in compliance of the Order dated 10.04.2018 of Hon'ble High Court in LPA no.185/2018, the time spent between the filing of writ petition till 10.04.2018 has to be excluded for the purpose of Limitation under Section 14 of the Limitation Act, 1962. The writ petition was filed by the plaintiff on 19.02.2015. Hence, the period w.e.f 19.02.2015 to 10.04.2018 i.e. a period of 03 years 01 month and 22 days has to be excluded from counting the period of limitation for filing the present suit. If the benefit of the said period is given to the plaintiff, the suit filed by plaintiff is well within the limitation period for claiming any relief in the suit. Further the period spent by plaintiff in pre-litigation mediation w.e.f. 10.01.2019 to 08.02.2019 has to be excluded from computation under section 12A of The Commercial Courts Act. Further, the cause of action of the suit for recovery of penalty amount arose on 13.03.2016 when such penalty was deducted from the bills of plaintiff and suit is filed within three years thereof on 12.02.2019.
33. This issue is accordingly decided in favour of the plaintiff.
Issue No.2 :- Whether the suit is not maintainable for the want of proper notice to defendants under Section 478 DMC Act, 1957 ? OPD M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 53 of 68 CS Comm 192/2019
34. Onus to prove this issue was upon the defendant.
In the plaint, notice dated 07.05.2018 under Section 478 of the Delhi Municipal Corporation Act, 1957 and section 80 of The Code of Civil Procedure 1908, is stated to have been duly served upon the defendant. Receipt of notice is not denied by the defendant in the written statement. In his examination in chief, plaintiff has duly proved copy of the said notice as Ex.PW1/54. Pre-paid postal receipts of the notice are also proved as Ex.PW1/55 and Ex.PW1/56. Notice was duly addressed to both the defendants there is no denial of the documents Ex.PW1/54, Ex.PW1/55 and Ex.PW1/56 in the pleadings of the defendants or during the evidence of the parties. Learned Sh. Anupam has not pointed out any defect in the notice except that there is no demand of claim no.3 of plaint in respect of the payment under Clause 10CA of the Contract due to variation in prices of material. In Ex.PW1/54, plaintiff has categorically claimed recovery of the penalty amount of Rs.13,38,722/- deducted from its final bill along with interest @ 12 % per annum amounting to Rs.5,10,548/- totalling to Rs.18,49,217/-. Effect of not claiming compensation or reimbursement under Clause 10CA would be considered in later part of the judgment, however, complete suit of the plaintiff cannot be said to be not maintainable for want of notice under Section 478 of The Delhi Municipal Corporation Act, 1957. M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 54 of 68 CS Comm 192/2019
35. This issue is accordingly decided in favour of the plaintiff.
Issue No.5 :- Whether plaintiff is entitled to declaration, as prayed for ? OPP
36. For the purpose of the convenience, this issue is taken up prior to the discussion on issued no.3 and 4, because part claim for recovery is dependant upon the decision on this issue.
37. Onus to prove this issue was upon the plaintiff.
38. Contents of the Letter dated 11.02.2015 Ex.PW1/49 are reproduced herein below:-
No.:D/EE(Pr)-1SZ/2014-2015/944 Dated 11.02.2015 To, M/s R.K.Goel Abhey Kumar Jain C-1/40, Ashok Vihar Phase-II, Delhi-110052 Name of work:-Improvement/strengthening of internal roads by dense carpeting from (.......................), 269/1 to 254/1, H-12/14 to H- 10/1, H-1/1 to H-3/15 and Ajit Chemist to H-10/1 in Hauz Rani in ward no.162 South Zone.
Work Order No.:- EE Project South-1/SYS/2013- 2014/6 dated 28.09.2013.
The above mentioned work was awarded to you vide work order no.EE Project South-1/SYS/2013- 2014/6 dated 28.09.2013 for a contractual amount of Rs.1,33,87,221/- with a time of completion of 06 months M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 55 of 68 CS Comm 192/2019 i.e. up to 06.04.2014.
The competent authority vide Order dated 20.05.2014 approved penalty @ 10% on contractual amount against the agency, to delay the work without any valid reason under clause-2 of agreement, as the entire delay is on the part of contractor.
In view of above, you are directed to deposit Rs.13,38,722/- for the penalty approved by the competent authority under clause -2 to unnecessary delay the work or the same will be recovered from your bill of the work.
Ex. Engineer (Pr)-1 South
39. A bare reading of the letter reflects that the penalty of 10% of the contractual amount was imposed against the plaintiff to delay the work without any valid reason under Clause 2 of the Agreement. Entire delay in performance of the contract is stated to be on the part of the plaintiff. After attributing the blame for delay upon him, the plaintiff was directed to deposit Rs.13,38,722/- as penalty amount failing which the same was supposed to be recovered from the bills of the plaintiff.
40. Court is in agreement with the submission of Learned Sh. Narula that from the pleadings and evidence of the parties, it cannot be said that the plaintiff was responsible for entire delay in performance of the work. Following delays can be easily attributable to the M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 56 of 68 CS Comm 192/2019 defendants from the pleadings and evidence of the parties.
(1) Delay in providing job mix formula for performance of work.
26.1 It is admitted case of both the parties that a job mix formula already approved on 02.01.2013 was available prior to the award of tender dated 28.09.2013. It is however further admitted that the said job mix formula was valid only up to 01.01.2014. Work was supposed to be completed on 06.04.2014. Hence, after 01.01.2014, fresh job mix formula was required to be provided or approved by the defendant to the plaintiff. The defence in the written statement that the plaintiff could have completed the work on the basis of job mix formula already available, prior to award of the contract, is not tenable. The defendant never asked the plaintiff to complete the work on the basis of already available job mix formula. Once the already available job mix formula was valid only up to 01.01.2014, it was for both the parties to ensure that well before expiry of the job mix formula already available prior to start of work, the new formula is provided to the plaintiff. If the defendant intended to continue the work on the basis of the already available job mix formula, the plaintiff should have been specifically informed about the same. Defendants did not do the same. Well before the start of work, plaintiff sent the samples of material of the job mix formula to the M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 57 of 68 CS Comm 192/2019 defendant for its approval by defendant vide his letter dated 03.10.2013. This fact is not denied in the pleadings. The defendant has rather categorically admitted that the new job mix formula was got approved from the laboratory on 20.03.2014. There was sufficient time with the defendant to get the sample of material tested after 03.10.2013. Plaintiff performed the duties and the acts required on his behalf for getting approval of the job mix formula applicable after 01.01.2014. It was the defendant who did not intimate the new job mix formula till 20.03.2014 despite compliance of all formalities and deposition of testing charges by the plaintiff. Even during the period w.e.f 01.01.2014 to 20.03.2014, there is not a single letter issued by the defendant to the plaintiff asking to continue the work on the basis of old job mix formula. Defence in the written statement to this effect, is of no help to the defendant and appears to be an afterthought only. Hence, the delay at least w.e.f. 01.01.2014 to 20.03.2014 is solely attributable to the defendants.
(2) Non-recording of measurements of work done by the plaintiff.
26.2 The letter dated 28.09.2014 Ex.PW1/5 for award of work in favour of plaintiff issued from the executive engineer clearly mentions the measurement book no.3440 for recording the performance of work by the plaintiff. The measurement book was supposed to be M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 58 of 68 CS Comm 192/2019 issued prior to or at least along with the date of commencement of the work. The said measurement book no.3440 was supposed to be in possession of the officials of the defendant. The said book has not been produced by the defendant. Instead another measurement book no.3723 Ex.PW1/16 has been produced. This measurement book no.3723, as per the seal from the account department of the defendant, was issued only on 13.03.2014. Hence, it is rightly submitted by Learned Sh. Narula that there should have been some other measurement book for recording of the work of the plaintiff because even as for the defendant substantial work was supposed to have been completed by 13.03.2014. The measurement book recording the performance of the work done by the plaintiff prior to 13.03.2014, has been withheld by the defendant. An adverse inference is required to be drawn against the defendant that the plaintiff might be continuing the work, but the defendant either did not record the same or purposely withheld the documents in which the said work was recorded. A perusal of the written statement reflects that the defendant, in reply to paragraphs no.43.1 to 43.2 of the plaint stated that after the letters dated 24.11.2013 and 06.12.2013, plaintiff executed 5% work and stopped the work for no reason. Thereafter, Engineer Incharge vide his letter dated 31.12.2013 again requested the plaintiff to resume the work. For the sake M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 59 of 68 CS Comm 192/2019 of arguments, even it is presumed that only 5% work was completed by the plaintiff prior to 31.12.2013, the same could not have been recorded in the measurement book no.3723 which was issued on 13.03.2014. Hence, there is some force in the submission of Learned Sh. Narula that the defendant manipulated the entries in the measurement book and did not record the work performed by the plaintiff properly. In addition thereto, there are apparent manipulations, cuttings and rubbing in the measurement book no.3723. It appears that some entries of dates made by pencils have been rubbed or erased and the new dates have been mentioned. Such rubbing or erasing is against the mandatory terms and contiditions mentioned on the opening pages of measurement book. More specifically Clause 16C (16 (ग)) specifically prohibits any rubbing or erasing of the pencil entries. It is difficult to read actual dates of the rubbed entries made by pencil, however impression of the same can be seen by a careful perusal. The said rubbed dates/entries, seen in the light of the photocopy of the measurement book no.3723, which was filed by the plaintiff claiming to have been supplied by the defendant, may give a little better picture. There is some substance in the submission of Learned Sh. Narula that the dates written by pencil, which were later on rubbed in the original measurement book, can be seen in the photocopies of the measurement book which were M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 60 of 68 CS Comm 192/2019 provided to the plaintiff by defendant. However, the photocopies of the said measurement book have not been properly proved, hence, no conclusive findings can be written on the basis of the said photocopies. It is however clear that rubbing and erasing the pencil entries has been made by the defendant in measurement book no.3723 Ex.PW1/16. Non-production of the measurement book no. 3440, issuance of the measurement book no.3723 on 13.03.2014, and manipulation/rubbing of the entries in the measurement no.3723 is sufficient to reflect that the defendant has tempered with the record to the prejudice of the plaintiff. Preponderance of the probabilities is therefore titled in favour of the plaintiff and against the defendant that in order to impose the liability for delay upon the plaintiff, the defendant had withheld relevant documents and manipulated the measurement book no.3723 Ex.PW1/16.
(3) Wrong mentioning of the facts in the Order/note dated 20.05.2014.
26.3 The impugned letter dated 11.02.2015 is based upon the Order dated 20.05.2014. It is specifically mentioned in the Letter dated 11.02.2015 that Competent Authority vide Order dated 20.05.2014 approved penalty @ 10 % of contractual amount for delay of work on the part of the contractor. Hence, it can be safely said that the foundation of the letter dated 11.02.2015 is the Order dated 20.05.2014. The said Order dated 20.05.2014 is M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 61 of 68 CS Comm 192/2019 Ex.PW1/29. In the said Order, it is mentioned that no reply to the show cause notice dated 15.04.2014 was received from the plaintiff. This observation in the Order dated 20.05.2014 is contrary to the facts appearing on the record. In para 20 of the plaint, plaintiff categorically stated that he replied to the show cause notice dated 15.04.2014 vide his letter dated 25.04.2014. This fact is not even denied by the defendant in corresponding paragraphs of the written statement. The letter dated 25.04.2014 has even been proved by the plaintiff as Ex.PW1/23. There is no suggestion to PW1 that the letter dated 25.04.2014 was not sent by plaintiff to the defendant. Hence, there is wrong recording of the fact in the Order dated 20.05.2014. The Letter dated 11.02.2015, issued on the basis of the said Order dated 20.05.2014 is therefore vitiated as it did not consider the facts in reply of plaintiff vide letter dated 25.04.2014 Ex.PW1/23.
(4) Non-filing of the work agreement by the defendant.
26.4 In paragraph 6 of the plaint, plaintiff stated that defendant is the custodian of the agreement signed between the parties on 14.03.2014. It appears that Clause 2 of the said agreement has been invoked by the defendant for imposition of penalty upon the plaintiff. The averment in the plaint that the defendant is custodian of the agreement is not denied in the written M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 62 of 68 CS Comm 192/2019 statement. Rather, in his cross-examination dated 07.04.2022, Superintending Engineer Mr. Ajay Kumar Aggarwal appearing as DW1 categorically admitted "The original agreement is prepared and is kept with the department. In the work order Ex.PW1/5, the MB number mentioned is 3440". In his further cross- examination on dated 19.04.2022, he stated "I have brought the original agreement w.r.t the present work. The same contains two pages, copy of the same is exhibited as Ex.DW1/P1 (OSR)". In his further cross- examination of the same date, he admitted that the document Ex.DW1/P1 does not contain any clause 2 under which action was taken against the plaintiff. No copy of notice inviting tender, signed by the parties, was produced to justify action under the alleged Clause 2 of the agreement between the parties. A perusal of copy of the purported agreement Ex.DW1/P1 reflects that the same do not contain any Clause 2 under which the penalty could have been imposed upon the plaintiff. In fact, there is no clause or condition in the said document Ex.DW1/P1 for which any penalty could have been imposed upon the the plaintiff on the ground of delay in execution of work. At the most, the said document provides that the earnest money deposited by the plaintiff can be forfeited if the plaintiff fails to undertake the work. Plaintiff never failed to undertake the work, the work was ultimately completed within the extension M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 63 of 68 CS Comm 192/2019 of time granted from time to time. No clause or condition of Ex.DW1/P1 Could have been invoked to impose penalty upon the plaintiff for alleged delay in execution of the work. Once the defendant had itself granted extensions to the plaintiff and the plaintiff completed the work within extended period, it was for the defendant to show that the action of penalizing the plaintiff was as per the agreement between the parties. Defendant was custodian of the original tender and agreement etc. Not providing any term or condition justifying the imposition of the penalty upon the plaintiff renders the acts of the defendant as void-ab-initio.
41. This issue is accordingly liable to be decided in favour of the plaintiff and against the defendant. It is therefore held that the plaintiff is entitled to a decree of declaration thereby holding that the action taken by the defendant against the plaintiff vide Letter dated 20.05.2014 and 11.02.2015 were bad and illegal.
42. Issue No.3 : Whether the plaintiff is entitled to decree of recovery of suit amount against the defendants? OPP
43. Onus to prove this issue was upon the plaintiff.
Vide Letter dated 11.02.2015, the penalty amount of Rs.13,38,722/- was imposed upon the plaintiff. Once the letter dated 11.02.2015 has been declared illegal and bad in law, necessary consequence is that the defendant was M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 64 of 68 CS Comm 192/2019 not entitled to deduct any amount of penalty imposed vide the said letter dated 11.02.2015. Consequently, the plaintiff is entitled to recovery of the amount deducted by the defendant from the pending bills of the plaintiff on account of the penalty imposed vide letter dated 11.02.2015. Plaintiff is thus entitled to recovery of the principal amount of Rs.13,38,722/-. The plaintiff has claimed pre-suit interest upon this amount @ 12 % per annum w.e.f 05.03.2015 amounting to Rs.5,95,053/- (Rupees Five Lacs Ninety Five Thousand and Fifty Three Only). After deduction of the amount of Rs.13,38,722/-, the defendant made payment of the final bill to the plaintiff on 14.03.2016. This court is in agreement with the submissions of Learned Sh. Anupam Sharma that the final bill was prepared by the defendant on its own. There is nothing to suggest that the plaintiff ever submitted any running account bill or the final bill to the defendant, prior to preparation of final bill by the defendant. This court is therefore of the opinion that the plaintiff should receive pre-suit interest w.e.f 15.03.2016 i.e. after 14.03.2016 when the defendant paid the final bill amount to the plaintiff after deducting the penalty of Rs.13,38,722/-.
44. Apart from the recovery of the penalty amount, plaintiff has also asked for recovery of Rs.1,81,885/- on account of reimbursement under Clause 10CA of the Agreement as claim no.3.
M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 65 of 68 CS Comm 192/2019
45. Learned Sh. Narula argued that the plaintiff is entitled for this payment due to variation in prices of material because of non-cooperative attitude of the defendant in performance of work.
46. Court is not inclined to award any compensation or reimbursement under this claim firstly because none of the parties has brought on record the agreement containing clause 10CA. Secondly, the plaintiff never raised this demand during the continuation of work or after completing the same. Neither in the writ petition or in the LPA no.185/2018, any such demand was made. Even the notice issued by the plaintiff under Section 478 of The Delhi Municipal Corporation Act, 1957 was restricted to claiming the penalty amount of Rs.13,38,722/- along with interest @ 12 % per annum. Further, there is no record to suggest that there was any variation or escalation in the price of the material or that defendant was liable to make good the loss to the plaintiff on account of such variation or escalation in price of the material. This claim of the plaintiff is liable to be rejected.
47. In view of aforesaid discussion of the court, it is held that the plaintiff is entitled to recovery of the principal amount of Rs.13,38,722/- along with pre-suit simple interest @ 10 % per annum calculated w.e.f 15.03.2016 till filing of suit which comes out to Rs.3,84,378.26/-, rounded off to Rs.3,84,378/-. M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 66 of 68 CS Comm 192/2019
48. Hence, the plaintiff is entitled to recovery of amount of Rs.13,38,722 + Rs.3,84,378 = Rs.17,23,100/-.
49. This issue is accordingly decided.
Issue No.4 : Whether plaintiff is entitled to any interest, if so, on what amount, at which rate and for which period ? OPP
50. Onus to prove this issue was upon the plaintiff. It is rightly submitted by Learned Sh. Narula that the transaction between the parties was commercial and the defendant has wrongfully deprived the plaintiff from its legitimate money which could have been invested by plaintiff to earn profits from its business. Plaintiff is thus entitled to the pendentelite and future interest also. Considering the facts and circumstances, this court is of the opinion that pendentelite and future simple interest @ 10 % per annum upon the principal amount of Rs.13,38,722/- would suffice the end of justice. Plaintiff is thus held entitled to simple interest @ 10 % per annum upon the principal amount of Rs.13,38,722/- w.e.f 15.03.2016 till realization of the amount.
51. This issue is accordingly decided.
Relief
52. In view of the aforesaid discussion, the suit of the plaintiff is decreed with cost against the defendant for an amount of Rs.17,23,100/- (RUPEES SEVENTEEN M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 67 of 68 CS Comm 192/2019 LAKHS TWENTY THREE THOUSAND ONE HUNDRED ONLY) with pendentelite and future interest @ 10% per annum on Rs.13,38,722/- (RUPEES THIRTEEN LAKHS THIRTY EIGHT THOUSAND SEVEN HUNDRED TWENTY TWO ONLY).
53. Decree sheet be prepared accordingly.
54. File be consigned to record room.
Digitally
signed by
AJAY
AJAY
Announced in the open court PANDEY
PANDEY
Date:
on the 17th day of August, 2024
2024.08.17
14:42:27
+0530
(Ajay Pandey)
District Judge
(Commercial Court-10)
Central, Tis Hazari Courts, Delhi.
M/s R.K. Goel Abhey Kumar Jain Vs Municipal Corporation of Delhi & Anr. Page no. 68 of 68
CS Comm 192/2019