Karnataka High Court
Mr Ravindra Kumar vs M/S San Engineering And Locomotive Co. ... on 26 November, 2024
Author: K.Natarajan
Bench: K.Natarajan
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NC: 2024:KHC:48386
RFA No. 1831 of 2019
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 26TH DAY OF NOVEMBER, 2024
BEFORE
THE HON'BLE MR JUSTICE K.NATARAJAN
REGULAR FIRST APPEAL NO. 1831 OF 2019 (MON-)
BETWEEN:
MR. RAVINDRA KUMAR
PROPRIETOR OF M/S THEME
BUILDING CONSULTANTS
NO.358, 1ST MAIN, 7TH CROSS
YEMALUR, BENGALURU - 560 037.
...APPELLANT
(BY SRI. CHIKKANAGOUDAR, ADVOCATE)
AND:
M/S SAN ENGINEERING AND LOCOMOTIVE CO. LTD.,
PLOT NO.4, POST BOX NO.4802,
MAHADEVAPURA POST,
WHITEFIELD ROAD,
BENGALURU - 560 048.
REPRESENTED BY ITS VICE PRESIDENT (FINANCE)
Digitally signed by
AND COMPANY SECRETARY MR.KISHORE GOVENDE,
VEDAVATHI A K S/O K V GOVENDE,
Location: High AGED ABOUT 58 YEARS,
Court of Karnataka
R/AT NO.292, 1ST BLOCK
...RESPONDENT
(BY SRI. SUBRAHMANYA M K., ADVOCATE)
THIS RFA IS FILED UNDER ORDER 41 RULE R/W SEC.96
OF CPC., AGAINST THE JUDGMENT AND DECREE DATED
27.02.2019 PASSED IN OS.NO.26796/2013 ON THE FILE OF
THE LXXIII ADDITIONAL CITY CIVIL AND SESSIONS JUDGE,
BENGALURU (CCH.NO.74) DECREEING THE SUIT FOR
RECOVERY OF MONEY.
THIS APPEAL, COMING ON FOR ADMISSION, THIS DAY,
JUDGMENT WAS DELIVERED THEREIN AS UNDER:
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NC: 2024:KHC:48386
RFA No. 1831 of 2019
CORAM: HON'BLE MR JUSTICE K.NATARAJAN
ORAL JUDGMENT
This appeal filed by the appellant/defendant under Section 96 of CPC., for setting aside the judgment and decree passed by the LXXIII Addl. City Civil & Sessions Judge, Mayohall Unit (CCH-74), Bangalore, in OS.No.26796/2013 dated 27.02.2019, for having decreed the suit of the respondent/plaintiff and directed the appellant to pay Rs.6,00,000/- together with interest @ 10%.
2. Heard the arguments of learned counsel for the appellant as well as respondent.
3. The ranks of the parties before the Trial Court is retained for the sake of convenience.
4. The case of the plaintiff before the Trial Court is that the plaintiff has filed a suit for recovery of Rs.7,15,000/- with interest @ 10% from the defendant alleging that the plaintiff said be a company doing business, they want to put up a shed for their company, they contacted the defendant for the purpose of construction of shed and entered into a contract by -3- NC: 2024:KHC:48386 RFA No. 1831 of 2019 giving tender dated 29.11.2010, tender was accepted by the plaintiff, the total construction expenditure was estimated for Rs.62,68,202/- and after bargaining the defendant agreed to construct for Rs.60,00,000/-. Accordingly plaintiff has bee paid Rs.6,00,000/- to the defendant as advance consideration as first payment by deducting the TDS. However, the plaintiff was not able to put up the construction as they unable to get the approval from the BBMP/KIDB/Government authorities, therefore they intimated to the defendant to repay the amount as they have not able to get the approval from the concerned authorities. The plaintiff also got issued notice to the defendant and the defendant also gave evasive reply. Accordingly, suit came to be filed.
5. After issuance of summons defendant appeared through their counsel and filed their written statement by admitting the receipt of Rs.6,00,000/- and the contract entered between them. It is contended that after contract the defendant spent more than Rs.10,00,000/- towards the expenditure for guarding the site, engaging the labours and obtaining the tools for construction on rent. Therefore they -4- NC: 2024:KHC:48386 RFA No. 1831 of 2019 unable to repay the advance amount received. Hence prayed for dismissal of suit.
6. Based on the above pleadings, the Trial court framed the following issues;
1) Whether the plaintiff proves that the defendant has agreed to give discount of Rs.2,68,202/- on the total consideration amount of Rs.62,68,202/- as per the terms of the contract dated 12.12.2010 that executed between the plaintiff and the defendant?
2) Whether the plaintiff proves that it has paid Rs.5,94,000/- to the defendant on 20.12.2010 through cheque dated 20.12.2010, drawn on State Bank of India?
3) Whether the plaintiff proves that on 07.12.2011 it has informed the defendant that the project is delayed, therefore it cancelled the contract dated 12.12.2010?
4) Whether the plaintiff proves that the defendant is liable to refund mobilization advance of Rs.6,00,000/-?
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NC: 2024:KHC:48386 RFA No. 1831 of 2019
5) Whether the plaintiff proves that the defendant has failed to repay the said mobilization advance amount in spite of his requests and demands?
6) Whether the plaintiff is entitled to the relief as sought for?
7) What order or decree?
7. In order to prove the case of the plaintiff, plaintiff company secretary is examined as P.W.1 and got marked 9 documents at Ex.P.1 to Ex.P.9. Per contra defendant is examined as DW.1 and got marked 12 documents at Ex.D.1 to
12. After hearing the arguments, the trial court answered the issue Nos.1 & 2 in the negative and issue Nos.1 to 6 in the affirmative and decreed the suit of the plaintiff.
8. Being aggrieved by the same, the defendant is before this court.
9. Learned counsel for the appellant/defendant has contended the judgment of the Trial Court is erroneous and it is not properly considered the defence taken by the defendant in the written statement. He has spent much amount towards the expenditures and no defence was considered which is not -6- NC: 2024:KHC:48386 RFA No. 1831 of 2019 correct. It is a fault on the part of the plaintiff, who was not assigned the work and given the site, in spite of one year they unable to get the permission and as per Section 73 of the Indian Contract Act, damages was done to the defendant and hence prayed for setting aside the judgment and decree passed by the Trial Court.
10. Having heard the arguments and perused the records the points that arises for my consideration are;
1) Whether the plaintiff proves that the amount of Rs.6,00,000/- paid to the defendant towards the contract and he is entitle for the refund of the same after deducting the TDS?
2) Whether the defendant proves he has spent more than Rs.10,00,000/- and it was claimed as damages spent by him?
3) Whether the judgment and decreed passed by the Trial Court is called for the interference?
4) What order?
11. On perusal of the records it is not in dispute that there was contact between the plaintiff and defendant for the -7- NC: 2024:KHC:48386 RFA No. 1831 of 2019 purpose of construction of a shed in a site, and both have agreed to the terms of contract and defendant has also received Rs.6,00,000/- as first payment. The Ex.P.9 is the contract agreement entered between the parties and as per the clause 9 of the agreement 10% of the amount shall be released by the owner to the contractor in terms of the agreement and the same is accepted by the defendant and also received the amount. However the tender document does not reveal anything about the forfeiting the amount by the defendant contractor in case any violation of the terms and conditions. However it is also case of the plaintiff that he has tried to obtain permission from the KIADB/BBMP but they have not approved the plan of the plaintiff for the purpose of construction. Therefore they issued notice to the defendant as per Ex.P.7 for refund of the money. Though the defendant also given evasive reply stating that he has spent lot of money as per Ex.D.9, he has said to be came for four occasions and used sophisticated materials for coming to the spot and they incurred loss of Rs.10,00,000/-. Though he has pleaded in the defence statement but there is no counter claim made in the suit of the plaintiff. However, though the defendant has stated -8- NC: 2024:KHC:48386 RFA No. 1831 of 2019 he has spent Rs.10,00,000/- towards expenditure but not a single piece of paper/document produced by the defendant either in the form of oral or documentary evidence to show that he has spent any amount for the purpose of purchasing any construction materials like steel, stones, cement or any other equipments for the purpose of construction. Even there is no documents produced to show he has put up any shed for the purpose of construction or dig out any pit for the purpose of laying foundation and no material is dumped in order to start up the construction work. Except the oral pleading the written reply there is no documents to show he has spent any amount for construction. The very defence in the written statement para 10 the defendant has stated the site was not at all handed over to the defendant for the purpose of construction. When the site itself is not handed over to the defendant for the purpose of construction, starting the work, dumping the materials cannot be acceptable but the amount received by him, the plaintiff was not assigned any work, except making first payment as per clause -9 of the Ex.P.9. Though the defendant has taken various contention, but no documents produced, no witnesses have been examined by the defendant, -9- NC: 2024:KHC:48386 RFA No. 1831 of 2019 in order to show he has paid salary to the labours. Of course he might have visited the spot for the purpose of verifying the spot for construction and entering into contract for fixing the rate for construction, that itself cannot be a ground for he has spent Rs.10,00,000/-. On the other hand the plaintiff paid Rs.6,00,000/- as first installment as per clause-9 and no work has been carried out by the defendant. Therefore, the defendant required to return the amount.
12. Though the learned counsel has taken contention that Section 73 of the Contract Act, the Trial Court also considering Section 73 of the Contract Act, and jurisdiction mentioned in the section and held that when the no work done the question of claiming any amount as counter claim does not arise. Even counter claim made by the defendant in this suit by paying necessary court fee. Therefore I am of the view considering the facts and circumstances the Trial Court rightly appreciate the evidence and decreed the suit. However there is no privity of contract for payment of 10% of interest either in the contract or agreement between the parties. Such being the case imposing 10% interest on the amount is not correct and
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NC: 2024:KHC:48386 RFA No. 1831 of 2019 the same is liable to set aside. Accordingly I pass proceed to pass the following;
ORDER The appeal is allowed in part.
The decree of the trial court is modified. The decree in respect of Rs.6,00,000/- payable by the defendant to the plaintiff by deducting TDS has been confirmed. However, the 10% interest per annum imposed by the Trial Court is hereby set aside.
No order as to costs.
Sd/-
(K.NATARAJAN) JUDGE SRK LIST NO.: 1 SL NO.: 26 CT:SK