Delhi District Court
Tilak Raj vs New Delhi Municipal Council on 30 March, 2010
1
IN THE COURT OF SH. JAGDISH KUMAR : COMMERCIAL CIVIL
JUDGE : NEW DELHI DISTRICT : NEWDELHI.
NO. S72/09/04
Tilak Raj
s/o Sh. Khoya Ram
Prop. of M/s Seighneur Versatile (India)
89,DSIDC Complex, Scheme1
Okhla Industrial Area PhaseII
New Delhi. ..............Plaintiff
Vs.
1.New Delhi Municipal Council
Palika Kendra, Parliament Street,
New Delhi.
2. The Executive Engineer (StoreII)
Electrical StoreII Division
New Delhi Municipal Corporation
Vidyut Bhawan, Aurangzed Road.
New Delhi.
...........Defendants
Date of institution:10.08.2004
Date of arguments: 30.03.2010
Date of judgment: 30.03.2010
SUIT FOR RECOVERY OF RS. 78,615/
JUDGMENT
Brief facts, the plaintiff is the proprietorship concern dealing NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 2 in power equipments. The defendants invited tenders for the distribution pillars (big, medium and minimum). The plaintiff has submitted his tender alongwith earnest money of Rs. 75,000/ and Rs.230/ vide banker cheques no. 519667 and 519669 dated 28.10.09, respectively. The banker cheques were drawn on State Bank of India, Okhla Industrial State, New Delhi. The tender was opened on 30.10.2003 and the plaintiff's offer was emerged as lowest and remained open for acceptance by the defendant for a period of 120 days from the date of opening of tender. The tender remained open till 26.2.2004.
2. On 13.2.2004, the plaintiff has received a letter bearing no. D213/EE(SII) vide which defendants have requested extension of the validity of tender offer up to 30/4/2004. Though plaintiff was not intended to extend the validity of his offer but on persistent request from defendant and to maintain cordial business relations, plaintiff has extended the validity of his offer up to 15.4.2004.
3. On 6.4.2004, the plaintiff again received a fax seeking one more extension of the offer up to 30.5.2004. The plaintiff vide his letter dated 16.4.2004 informed the defendant that he could not extend the period of validity which has expired on 15.4.2004. The plaintiff has also received a letter dated 15.4.2004 on 20.4.2004 for supply order no. 4/D686/200405/EE (SII). The said supply order is of no consequence as the validity of offer has already expired on 15.4.2004. There was no NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 3 extension granted by the plaintiff after 15.4.2004. There was no contact between the plaintiff and defendants.
4. The officials of the defendants have not refunded the earnest money despite giving several notices. But they have threatened the plaintiff for blacklisting the plaintiff for future contracts. The said contemplated action would be colourful exercise of authority by the defendants. The plaintiff has served a legal notice under section 80 CPC dated 14.5.2004 by Registered AD and UPC upon the defendants through which he has called the refund of Rs. 75,230/ from the defendants alongwith interest @18% p.a. within statutory period of 60 days. The legal notice was duly served. The defendants sent a frivolous reply 2.6.2004. The plaintiff sent a rejoinder dated 26.6.2004. The defendant has not refunded the earnest money. The present suit has been filed for recovery of Rs.78,164/ alongwith pendentlite as well as future interest @ 18% per annum.
5. Written Statement has been filed by the defendant. The defendant has stated in his Written Statement that the StoreIInd Division Head invited tenders for the purchase of distribution pillars in the month of October, 2003. The tender of the plaintiff was emerged lowest. The work was awarded to the plaintiff vide supply order no. 4/EE(SII)/200405 dated 15.4.2004. The order was issued and delivered on 15.4.2004 to the plaintiff by speed post as well as personally by handing over the order. The order was sent through NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 4 speed post from Lodhi Road Post Office after the efforts were failed to contact the firm on telephone and fax. The defendant also deputed Sh. Panni Gupta, AEEIInd (SII) to hand over the supply order to the firm personally. Who reached at office/ factory of the plaintiff firm at Okhla Industrial Area. He found a handwritten slip on the letter box to the effect that 15.4.2004 is a holiday. The shutter of the office was found unlocked. Sh. Tilak Raj, proprietor of the plaintiff firm found coming from the office. He was requested to receive the order for supply of the items. But he refused to accept the same. After persuasion the plaintiff has received the supply order and thereafter copy of the supply order was dropped inside the letter box in the presence of Tilak Raj. The plaintiff was informed vide letter dated 23.6.2004 to submit the delivery schedule and to execute the required agreement for supply of the pillars. The plaintiff did not done the same, for the reasons best known to the plaintiff. The notice was duly replied by the defendants confirming the fact that supply order was delivered on 15.4.2004 personally by Sh. Panni Gupta, AEE (SII) to the plaintiff besides sending the same through Speed Post on 15.4.2004. The plaintiff was also informed vide letter dated 23.6.2004 for non submission of delivery schedule. The defendants had also wrote letters dated 20.4.2004, 23.4.2004, 26.4.2004, 27.4.2004 and 13.5.2004 to plaintiff to comply with the contract. The defendants further requested the plaintiff to supply the material vide letter dated 11.8.2004. The defendants vide letter dated 21.9.2004 had informed the cancellation of the contract to the plaintiff.
NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 5
6. It is averred by the defendants in their WS that it is the defendants who are entitled to the recovery of compensation in lieu of the breach of contract on the part of plaintiff. It is further averred in the WS that plaintiff is not entitled for any refund of security. It is prayed in the WS that suit of the plaintiff is liable to be dismissed with cost.
7. Replication has been filed by the plaintiff in which he has denied all the averments made in the WS and reiterated the averments made in the plaint.
8. On the pleadings of the parties following issues were framed on 28.09.2005 as under:
1. Whether the suit is barred by law of limitation? OPD.
2.Whether plaintiff is entitled to the amount as prayed for?OPP.
3. Whether plaintiff is entitled to the interest? If so at what rate and from what period? OPP.
4. Relief.
I have heard Ld. counsel for both the parties at length and also perused the testimonies of witnesses on record. I have also gone through the documents. My issue wise findings are as under: Issue no. 1: The onus to prove this issue is on defendant. The issue has been framed whether the suit of the plaintiff is within period of NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 6 limitation. The issue is legal. Ld. counsel for defendant has failed to brought to the notice of this court how the suit of the plaintiff is barred by period of limitation. The suit has been filed on 10/8/2004 arising from the alleged facts occurred in the year 2003 itself. The suit for recovery can be filed within three years from the date on which the cause of action arises. In the present case the security was deposited on 28.10.2003. The plaintiff is seeking the refund of securities deposited on 28.10.03. So, it is the view of the court that the suit of the plaintiff is within period of limitation. This issue is decided in favour of the plaintiff and against the defendant.
Issue No. 2: The onus to prove this issue is on plaintiff. The issue has been framed whether plaintiff is entitled for recovery as claimed. It is admitted position of the parties that the defendant has invited tenders with respect to supply of distribution pillars in the year 2003. It is also admitted position of the parties that when the notice inviting tender was opened and it was found that the plaintiff has made the lowest bid. The lowest bid of plaintiff has been considered as standing offer by the plaintiff. The defendants have to accept the offer within the period prescribed through notice inviting tender. It is admitted position of the parties that initially the offer has to be accepted by 26.2.2004. It is also admitted position of the parties that the validity of offer was extended by the plaintiff by 15.4.2004 through letter Ex. PW1/2.
The question before this court is whether the defendants have accepted the standing offer of plaintiff by 15.4.2004 or plaintiff has revoked his offer even prior to 15.4.2004. Before further discussing the NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 7 evidence of parties, I would like to reproduce section 4 and section 5 of the Indian Contract Act which reads as under: "Communication when complete - The communication of a proposal is complete when it comes to the knowledge of the person to whom it is made. The communication of an acceptance is complete as against the propers, when it is put in a course of transmission to his so as to be out of the power of the acceptor;
as against the acceptor, when it comes to the knowledge of the proposer.
The communication of a revocation is complete as against the person who makes it, when it is put into a course of transmission to the person to whom it is made, so as to be out of the power of the person who makes it;
as against the person to whom it is made, when it comes to his knowledge."
Further, Section 5 of the Indian Contract Act which reads as under: "Revocation of proposals and acceptance -
A proposal may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterwards.
An acceptance may be revoked at any time before the communication of the acceptance is complete as against the acceptor, but not afterwards."
NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 8 The plaintiff as well as defendant has adduced their evidence respectively. The plaintiff has deposed in his examination that defendant had made a request for extension of offer from 15.4.2004 to 30.5.2004 vide letter Ex. PW1/3 but he has refused to extend the period beyond 15.4.2004 through Ex. PW1/4. The document Ex.PW1/4 has admitted by the defendant at the stage of admission and denial. The said letter was received in the office of the defendant on 16.4.2004. The defendant has deposed before court through DW1 that on 15.4.2004 a delivery order was handed over to the plaintiff at his address in Okhla. It is further deposed by DW1 that they have tried to send the acceptance through fax but same could not be sent. DW1 deposed in his examination that acceptance was made through letter in the presence of Mr. Panni Gupta, Executive Engineer (electricity) of the defendant. Mr. Panni Gupta has been examined as DW2. DW2 has deposed in his cross examination that the plaintiff has refused to receive the acceptance and insisted that the same be sent through post. No document has been placed on record which shows that any acceptance was sent to the plaintiff either through fax or post. After perusal of testimony it has been brought on record that no acceptance to the offer was sent to the plaintiff by post. The notice inviting tender has called the offer through post. The communication of the acceptance has to be communicated to the plaintiff through post. When the officials of the defendant met the plaintiff he has also insisted for sending the acceptance by post. The conduct of the parties shows that the acceptance has to be accepted through post but as proved on NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 9 record that acceptance could not be sent through post to the plaintiff then DW1 and DW2 has gone to the office of plaintiff to hand over the acceptance personally, on behalf of defendant no.1.
After giving thoughtful consideration to the arguments tendered by the ld. counsels and considering the law, the view of the court is that the acceptance of an offer must be absolute without giving any room of doubt. It is well settled that offer must be based and founded on three components i.e. certainty, commitment and communication. If any one of the three components is lacking either in the offer or in the acceptance that can not be a valid contract. An offer can be revoked at any time before the offer is accepted by the other party. In the present case it has been proved on record that defendants has not accepted the offer of plaintiff by 15.4.04 by post and it has also been proved on record that plaintiff has refused to take the delivery order in person. In the present case, it has been proved on record that DW1 and DW2 has visited the office of plaintiff and offered the delivery letter which has been refused by the plaintiff. Now the question arises whether the defendants can force the plaintiff to execute a contract. The offer can be revoked at any time before it is accepted. DW1 and DW2 has visited the office of the plaintiff to deliver the acceptance on behalf of defendant no. 1. But it has been proved on record that before acceptance is handed over to the plaintiff, plaintiff has shown his intention to revoke the offer. The offer must be certain, commitment and communication. Here in the present case the plaintiff has shown his intention not to execute any contract with the defendants. Plaintiff NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 10 can not be forced to execute a contract as he has shown his intention to revoke the offer and virtually withdrawn the offer in the presence of DW1 and DW2. It is held by Hon'ble High Court of Allahabad in case titled as "Shyam Biri Works Pvt. Ltd. Vs. U. P. Forest Corporation, AIR 1990 All 205, that offers on tenders were revoked before it was accepted. The contract never saw the light of the day.
Further, the defendants have admitted through Ex. PW1/4 that a written contract has to be executed between the plaintiff and defendants. Which proves that there was a condition that the contract has to be reduced in to writing. It is held by Hon'ble High Court of Delhi in case titled "J. K. industries Ltd. Vs Mohan Investments and Properties Pvt. Ltd., AIR 1992 Del 305" that a contract comes into existence only when all the terms and conditions have been finalized. If the facts of a particular case show that execution of a written contract was a condition precedent for coming into force of the contract between the parties, then it can not be said that any concluded contract in absence of a written contract being executed has come into force between the parties.
It is further held by Hon'ble Court of Guwahati in case titled as State of Tripura VS Bhowmik & Co. AIR 2004 Gau 21 that if there being no agreement, there was no breach of contract committed by the respondent and also that since there was no breach of contract, the petitioner can not retain or forfeit the earnest money deposited by the respondent by way of penalty.
So it is the view of the court that there was no contract NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 11 between the parties. The plaintiff has revoked its offer and defendants have retained the security of the plaintiff without any cause.
This issue is decided in favour of the plaintiff and against the defendants.
Issue no. 3: The onus to prove this issue is on the plaintiff. The issue has been framed as, whether the plaintiff is entitled for interest, if so, at what rate and for what period. The plaintiff has deposed through his affidavit that he is entitled for 24 per cent interest on the principal amount of security. As I have held above that there was no contract between the plaintiff and defendants. Nothing has been brought on record such as whether there was any condition to charge the interest of unrefunded security. In that eventuality the court has to see the usage and practices prevailed at the relevant time. Both the parties has not brought any usage and practices, on record which proves that there was any usage and practices prevailed to charge the interest on unrefunded security. It is held by the full bench of Hon'ble Supreme Court in case titled " Union of India Vs. West Punjab Factories Ltd." AIR 1996 SC 395 that in the absence of any usage or contract no interest can be awarded for the period up to the date of suit.
9. It is held by Hon'ble Supreme Court in case titled "Aditya Mass Communications (P) Ltd. Vs. A.P.S.R.T.C" AIR 2003 Supreme Court 3411 as under : " The quantum of interest a Court may NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 12 allow in a given case is governed by the facts of the case and not by any precedent law unless, of course, limited by a statue. If a Court comes to the conclusion on a given set of facts, a party has been wrongly denied the use of its own money, it is the duty of the Court to see that the said party is appropriately compensated. I."
10. Here in the present case, the defendants have retained the money of plaintiff without any justification. Even after giving demand notice, the security has not been refunded by the defendants. So, as per discussion above and legal preposition established by the Hon'ble Supreme Court of India, it is the view of the court that plaintiff is not entitled for any interest till the filing of suit. The interest of justice will be met if the interest of 12 per per annum from the filing of suit till the realization of the decree is awarded to the plaintiff.. This issue is partly decided in favour of the plaintiff and against the defendant.
11. Relief I have gave my issue wise findings as above. In view of the findings, the suit of the plaintiff is partly decreed. The plaintiff is entitled for a decree of Rs. 75,230/ with 12% interest from the date of filing of suit till the realization of amount. Decree sheet be prepared. File be consigned to record room.
Announced in open court. (Jagdish Kumar) 30.03.2010 Commercial Civil Judge, New Delhi District. NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 13 NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 14 Decree in a suit for Recovery
IN THE COURT OF SH. JAGDISH KUMAR : COMMERCIAL CIVIL JUDGE : NEW DELHI DISTRICT : NEWDELHI.
NO. S72/09/04 Tilak Raj s/o Sh. Khoya Ram Prop. of M/s Seighneur Versatile (India) 90,DSIDC Complex, Scheme1 Okhla Industrial Area PhaseII New Delhi. ..............Plaintiff Vs.
1.New Delhi Municipal Council Palika Kendra, Parliament Street, New Delhi.
2. The Executive Engineer (StoreII) Electrical StoreII Division New Delhi Municipal Corporation Vidyut Bhawan, Aurangzed Road.
New Delhi.
...........Defendants Claim for decree of Recovery of Rs. 78,615/ This suit coming on 10.8.2004 for final disposal before me, Jagdish Kumar, CCJ, New Delhi District, Patiala Houe Courts, New Delhi in the presence of both the parties, it is ordered that the suit of the plaintiff is partly decreed. The plaintiff is entitled for a NO. S72/09/04 CCJ/NDD/ND : 30.03.2010 15 decree of Rs. 75,230/ with 12% interest from the date of filing of suit till the realization of amount.
Cost of Suit
Plaintiff Rs. Defendant Rs.
1) Stamp for plaint 3,130/ 1) Stamp for power 2/
2)Stamp for power 2/ 2) Stamp for exhibit
3) Stamp for exhibit 3) Stamp for petition
4) Pleader's fee on Rs. 4) Pleader's fee on Rs.
5) Substance for witness 5) Substance for witness
6) Commissioner's fee 6) Commissioner's fee
7) Service of process 3/ 7) Miscellaneous 2/
8) Miscellaneous 8.75/
Total in Rs. 3143.75/ Total in Rs. 4/
Given under my hand and seal of the court on this day on 30.03.2010.
(JAGDISH KUMAR)
Commercial Civil Judge: New Delhi District
ND : 30.03.2010
NO. S72/09/04 CCJ/NDD/ND : 30.03.2010