Delhi District Court
Delhi Jal Board vs Chinar Shipping And Infrastructure ... on 30 March, 2026
IN THE COURT OF SH. R.L. MEENA, DISTRICT JUDGE
(COMMERCIAL COURT)-06, CENTRAL, TIS HAZARI COURTS,
DELHI
CS Comm No. 1629/2023
CNR No. DLCT01-016824-2023
Delhi Jal Board
Through its Executive Engineer (Project)
Water-I, Varunalaya Complex,
Delhi Jal Board, New Delhi-110055.
..........Plaintiff
Versus
1) M/S Chinar Shipping & Infrastructure India Pvt. Ltd.
315, Bharat Chambers, 52, Baroda Street,
Carnac Bunder, P.D. Mello Road, Mumbai-400009
Email ID: [email protected]
and [email protected]
Phone No. 022-42138121/30
2) M/S ASR Dredging Services Pvt Ltd.
7C, Oriental Gardens, South Tower,
Deshabhimani Road, Kaloor, Kochi-682026
Email: [email protected] and
[email protected]
Phone No. 0484-2981201
..........Defendants
Date of institution : 23.12.2023
Date on which reserved for judgment : 28.02.2026
Date of decision : 30.03.2026
SUIT FOR RECOVERY OF Rs. 43,15,072/- ALONG WITH
PENDENTELITE AND FUTURE INTEREST.
CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 1 / 37
JUDGMENT
1. Plaintiff has instituted the present suit for the recovery of Rs. 43,15,072/-(Fourty Three Lacs Fifteen Thousand and Seventy Two rupees) against the defendants.
2. Briefly stated, plaintiff/DJB had awarded work order bearing no. 05(2013-2014) dated 27.09.2013 EE (Project) W-I to M/S Chinar Shipping and Infrastructure India Private Ltd./defendant wherein it is a leading partner and it has joint venture agreement for consortium with M/S ASR Dredging Services Private Ltd. (defendant no. 2 herein) for dredging of silt from river Yamuna near intake at Wazirabad Water Works with a completion period of eight months. 2.1. It is further averred that plaintiff had also received one letter dated 23.01.2014 from defendant no. 2 i.e. M/S ASR Dredging Services Private Ltd whereby stating that M/S Chinar Shipping Infrastructure (India Private Limited) (defendant no. 1) had entered into joint venture agreement with their company i.e. defendant no. 2 herein for executing the work for the plaintiff as their firm had met the technical qualification stipulated in NIT (Notice Invited Tender) and plaintiff had accepted its joint bid.
2.2. It is further averred that plaintiff vide its letter dated 21.02.2014 had written a letter to defendant no. 1 giving reference of letter dated 23.01.2014 and letter dated 21.02.2014 and thereafter, on 18.10.2016 plaintiff had written a letter to defendant no. 2 regarding responsibilities, duties and stake as technical partner in the joint venture consortium.
2.3. It is further averred that the scope of work as entails in work order bearing no. 5 (2013-2014) is with respect to included the CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 2 / 37dredging quantity of 7,79,740/- cum (cubic meter) of sand silt from poundage area of Wazirabad Barrage in order to provide uninterrupted water supply for the water treatment plant at the cost of Rs. 14.97 crore.
2.4. It is further averred that in pursuant to the clause 2.7 of the Contract Agreement it states that contractor company/defendants herein had to pursue all the permissions from the relevant operating for completion of work i.e. "the bidder has to take all required permissions from concerned authorities. No claim whatsoever will be entertained on this account".
2.5. It is further averred that the date of start of subject work order was 03.10.2013 and the work was in progress till 30.06.2018 by defendants. No work has been executed after 30.06.2018, as the contractor company/ defendants herein failed to take permissions from the Revenue Department Government of NCT of Delhi as per the mandate under the contract.
2.6. It is further averred that last permission was made available for the period from 10.04.2018 to 30.06.2018 to the contractor company/defendants and the dredging against the permission was done at the site for the period from 26.04.2018 to 14.06.2018. 2.7. It is further averred that the contractor company/defendants upto 30.06.2018 has dredged quantity of 6,16,774 cubic meter against the stipulated quantity of 7,79,740 cubic meter, as per bill of quantity (BOQ) of this work, therefore, the balance dredging work has not been done by the contract company/defendants.
2.8. It is further averred that after 30.06.2018, in order to keep the contract alive and without prejudice to rights of the plaintiff CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 3 / 37department to recover liquidated damages in accordance with the provision of contract, plaintiff had granted provisional extension of time to the defendants for the completion of work.
2.9 It is further averred that plaintiff company vide its letter dated 09.07.2019 written to the defendants company to deposit the balance royalty against the material lifted from the site and it was further stated that till date, the quantity of sand dredged is 6,16,773.62 cubic meter and as per the contract agreement conditions, defendants company had to deposit royalty of minimum of 50% of the dredged quantity of sand and the minimum amount of royalty payable to the plaintiff workout to Rs. 7,70,96,703/- at the rate of 250 cubic meter of the 50 % of dredged quantity i.e. 3,08,386.81 cubic meter and the royalty which was received by the plaintiff/DJB till date workout Rs. 5,62,69,701/- only and was directed the defendants company to deposit balance amount of Rs. 2,08,27,002/- against the royalty of material as per conditions of the contract. The said letter dated 09.07.2019 is annexed hereto as annexure A5.
2.10. It is further averred that plaintiff/DJB again written a letter dated 22.07.2019 to defendant company regarding the deposit of the balanced royalty against the material lifted from the site amounting to Rs. 2,08,27,002/- as demanded according to the quantity of sand dredged till date i.e. 6,16,773.62 cubic meter. The said letter dated 22.07.2019 is annexed hereto annexure A6.
2.11. It is further averred that meeting was also held on 13.09.2019 in the office of plaintiff regarding the work "Dredging of silt from the river Yamuna near Intake at Wazirabad Water Works" wherein the officials of the defendant company were also present and same was CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 4 / 37reflected in MOM of the plaintiff department dated 20.09.2019 giving reference of minutes of meeting held on 13.09.2019 wherein it was clearly stated to the defendants company officials who were present in the meeting to comply with the contract agreement provisions and deposit the minimum balance amount of Rs. 2,08,27,002/- immediately against the quantity of silt/sand lifted from the site. The said MOM of the minutes dated 20.09.2019 is annexed hereto as annexure A7.
2.12. It is further averred that plaintiff had written various letters dated 30.10.2019, 03.12.2019, 27.01.2020, 12.02.2020, 02.09.2020, 08.10.2020 & 13.11.2020 to the defendants company regarding balance payment against the dredged material to the tune of Rs. 2,08,27,002/- to be paid to the plaintiff department. 2.13. It is further averred that plaintiff also issued a reminder letter dated 03.12.2020 to the contractor company/defendant thereby clearly stated that balance payment of Rs. 2,08,27,002/- against the dredged material has not been deposited till date. It also mentioned about the the request of the defendants company for granting extension of time "EOT" upto 30.06.2021 vide letter dated 15.10.2020 whereby case was referred for approval based on the period of hindrance recorded as per hindrance register of the work and the relevant clause 10.3 of the contract agreement regarding compensation of delay of work, which is reproduced hereunder:-
"Compensation of delay of work shall be at the rate of 1.5% of the contract price for each month of delay to be recovered on per day basis. Provided always that total amount of compensation for delay to be paid under this condition shall not exceed 10% of the contract price". It was further stated that the amount of Rs. 20,58,579/- has been withheld from the running bills CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.Page no. 5 / 37
as per terms of the contract agreement against the compensation of delay and further security deposit amount of Rs. 74,84,277/- deducted from the running bill as per the terms of the contract agreement also cannot be released or adjusted against the balance amount of royalty payable to the plaintiff/DJB till EOT (Extension of Time is approved). The reminder letter dated 03.12.2020 is annexed hereto as annexure A16.
2.14. It is further averred that plaintiff on 01.03.2021 had issued the reminder-cum final notice to the defendants reiterating the contents of the reminder dated 03.12.2020 categorically stating that the same be treated as a final notice and if there is no adherence to the same, the plaintiff may initiate any lawful action as deem fit under the provisions of contract agreement. The reminder-cum final notice dated 01.03.2021 is annexed hereto annexure A17. 2.15. It is further averred that a letter dated 01.12.2021 was written by plaintiff/DJB through its executive engineer (project) water-I to the District Magistrate (North East) Nand Nagri, Delhi regarding request for granting dredging permissions. The said letter is annexed hereto as annexure A18.
2.16. It is further averred that again a meeting was held on 14.12.2021 in the chamber of CEO of plaintiff/DJB wherein the officials of the defendants/contractor company were also present and minutes of meeting held on 22.12.2021 entails in the official letter dated 27.12.2021 where the question of non deposit of balanced royalty of the dredged sand amounting to Rs. 2,08,27,002.01/- at the rate of 50% of dredged quantity as per contract agreement was referred and further in the said meeting, the decisions have been taken for earlier completion of project. It is further submitted that in the said meeting held on 22.12.2021, contractor company/defendants agreed CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.Page no. 6 / 37
to fulfill its commitment regarding balanced royalty before the commencement of work as per the contract agreement and agreed to same, the minutes of meeting held on 22.12.2021 has been entails in the official letter dated 27.12.2021 and same is annexed hereto annexure A19.
2.17. It is further averred that plaintiff had also written a letter dated 05.01.2022 to the contractor/defendants to comply with the commitment as per minutes of meeting (MOM) dated 22.12.2021. The said letter is annexed hereto as annexure A20. 2.18. It is further averred that vide letter dated 02.02.2022, the plaintiff had stated that the contractor company/defendants had deposited the pending royalty amounting to Rs. 20,39,799/- in the bank account. Defendant company has not complied with the decision taken in the meeting dated 22.12.2021 for which MOM was issued on 27.12.2021. Defendant company complied partially. 2.19. It is further averred that in view of the reluctant behaviour to complied with the agreed decision, on 02.02.2022, the CEO of the plaintiff had stated that the tender of the contractor company/defendants be discharged and retender be done for the remaining amount and further all the pending recoveries of the contractor company/defendants be realized. The said noting of CEO of DJB is annexed hereto as annexure A-22.
2.20. It is further averred that accordingly, determination notice dated 04.02.2022 was issued by the plaintiff/DJB against the contractor company/defendant thereby stating that defendants have failed to deposit the balance royalty and delayed the work and despite giving commitment in the meetings, where the officials of defendants CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.Page no. 7 / 37
were present but same was not done in its true letter of spirit and failed to start the work after submissions of bank guarantee after gap of two months and further various reminders were issued to the defendants to deposit the balance royalty as per contract agreement but no veil, thus the defendants breached the material conditions of the contract agreement, which finally resulted in the termination of the contract under clause 11 (1, 2,3) of the contract agreement. The said termination notice dated 04.02.2022 is annexed hereto as annexure A-23.
2.21. It is further averred that on 10.02.2022 plaintiff had written a letter to the Federal Bank of India, Mumbai regarding encashment of bank guarantee amounting to Rs. 74,84,277/- to recover the balance royalty payable by defendants to plaintiff/DJB and thereby requested the bank to encash the above bank guarantee and credit the same in the account of the plaintiff bank. The letter dated 10.02.2022 is annexed hereto as annexure A-24.
2.22. It is further averred that plaintiff/DJB had written a letter dated 13.07.2022 to the contractor company/defendants regarding deposition of pending royalty as per clause 2 of the contract agreement and further stated that there is a deficit amount which could not be recovered i.e. it was mandatory as per clause 2.8 of the Contract Agreement to recover at the rate of 50% of the dredged material i.e. 6,16,773.62 x 50% = 3,08,386.81 cubic meter @ 250 = Rs. 7,70,96,702/- (A) and the total recovery /adjustment made by the plaintiff from the defendant company to the tune of Rs. 7,32,78,054/- (B) thus the deficit amount which could not be recovered from the defendant i.e. A-B = Rs. 7,70,96,702 - Rs. 7,32,78,054 = Rs.
CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 8 / 3738,18,648/- and accordingly the contract has already been terminated and the contractor company/defendant is liable to Rs. 38,18,648/- as per clause 2.8 + compensation as applicable as per clause 10.3. The letter dated 13.07.2022 written to the defendants by plaintiff is annexed hereto as annexure A-25.
2.23. It is further averred that plaintiff/DJB on 19.01.2023 had issued the final notice to the contractor company/defendant regarding deposit of pending royalty as per clause 2.8 of contract agreement and said final notice is annexed hereto as annexure A-26. 2.24. It is further averred that on 23.02.2023 defendant no. 2 had given reply to the final notice dated 19.01.2023 issued by plaintiff. The said letter is annexed hereto as annexure A-27. 2.25. It is prayed to pass a decree of Rs. 43,15,072/- in favour of plaintiff and against the defendants company which includes the principle amount of Rs. 38,18,648/- and the interest @ 12% per annum from 13.07.2022 till 13.08.2023 for 13 months amounting to Rs. 4,96,424/- and thus the total amount legally recoverable from the defendants at the time of filing of the case comes to Rs. 43,15,072/-. 2.26. It is also prayed to grant pendentelite and future interest @ 12% per annum from the date of suit till the date of payment in favour of plaintiff and against the defendants alongwith cost of the suit.
3. Summons were issued to the defendant no. 1 & 2. Defendant no. 1 did not appear despite process being served through publication in the newspaper "The Statesman" edition dated 17.07.2024, "The Statesman" edition dated 28.06.2024 as well as "The Times of India"
edition dated 17.07.2024. Accordingly, defendant no. 1 was proceeded ex-parte vide order dated 04.09.2024. CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.Page no. 9 / 37
4. Defendant no 2 has contested the present suit by filing the written statement inter-alia taking several preliminary objections particularly, suit of plaintiff is time barred and suit is not filed by the authorized person.
4.1. It is further contended that there is no cause of action to file the present suit. As per clause 2.8 of the technical specification and methodology of the tendered documents it was mandatory for the plaintiff to issue 50% of the dredged sand to the defendant. Plaintiff has not issued the 50% quantity of sand in terms of clause 2.8 and as such the demand of the plaintiff towards royalty is illegal and arbitrarily. Furthermore, plaintiff has not filed any documentary record or details of measurements that it has infact issue 50% quantity of sand in terms of clause 2.8 of the technical specification and methodology to the defendants. Accordingly, the amount claimed in the present suit is completely vague, hypothetical and without any substantive basis.
4.2 It is further contended that without prejudice to the rights and contention of defendant no. 2, plaintiff has admitted in its letters dated 19.08.2019 & 19.08.2019 to the SDM Karawal Nagar, New Delhi that only 2,57,238 cubic meter of sand was ever issued to defendants by plaintiff out of total dredged quantity of 6,16,773.62 cubic meter. Thus without prejudice, the plaintiff is only entitled to receive royalty of Rs. 6,43,09,500/- at the rate of 250 on the issued quantity of sand 2,57,238 cubic meter. However, plaintiff has categorically admitted in the plaint that it has made a total recovery of Rs. 7,70,69,702/- from the defendant thus it is in admitted position that plaintiff has recovered an excess amount of Rs. 1,27,60,202/- from the defendants CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 10 / 37and the defendants do no owe any further royalty to the plaintiff as alleged or at all. The letters dated 19.08.2019 & 19.08.2019 have deliberately not been filed in the present suit. Therefore, plaintiff has concealed true and material facts.
4.3. It is further contended that on 13.07.2022 and 19.01.2023 plaintiff issued notices wherein plaintiff has raised a demand of Rs. 38,18,648/- allegedly due as per clause 2.8 + compensation as per clause 10.3 of the contract agreement. After the issuance of notice dated 13.07.2022 and 19.01.2023, plaintiff again issued a notice dated 01.12.2023 to the defendant wherein plaintiff raised a completely new demand of Rs. 1,49,68,554/- as per clause 10.3 of the contract agreement which is totally contrary to the demand raised by the plaintiff in its earlier notice dated 13.07.2022 and 19.01.2023. Moreover, plaintiff has deliberately not filed the notice dated 01.12.2023 before this court.
4.4. It is further contended that it is admitted by the defendant no 2 that plaintiff issued notice inviting tender NIT no. 01(2013-14) (the NIT) for the project in question. In the year 2013, defendant no. 1 approached to defendant no. 2 and proposed that the parties collaborate to undertake contract for dredging. After deliberation, parties agreed to form a joint venture for promoting/marketing of defendant no. 2's capabilities in relation to dredging work. Accordingly, a joint venture agreement dated 07.05.2013 was executed between the defendant no. 1 & 2.
4.5 It is further contended that on 08.05.2013 defendant no. 1 & 2 entered into joint venture agreement for consortium for bidding for the project (JV Agreement No. 2). As per JV Agreement no. 2, CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 11 / 37defendant no. 1 was nominated as the lead/financial member of the consortium and the defendant no. 2 was the operational/technical member of the consortium. Defendant no. 1 as the lead member of the consortium, participated in the tender and submitted the bid on behalf of consortium on 10.05.2013. It is further contended that Contract in question was assigned to the defendants and it is also not disputed that defendant no. 1 & 2 were in the joint venture agreement dated 07.05.2013. It is further contended that plaintiff issued a letter of intent dated 29.08.2013 (LOI) and work order bearing no. F2(62)/EE(Project)WI/2013/2803 to 2822 (work order only in the name of defendant no. 1 and not in the name of consortium). Thereafter, the plaintiff also entered into a Contract Agreement dated 15.10.2013 ('the Agreement') with the Defendant No. 1 alone leaving out defendant no. 2. It is further contended that since the project was awarded based on the technical credentials of the defendant No. 2 and as a result defendant no. 2 raised objections. Therefore, defendant no 2 requested the plaintiff to amend the LOI and Work order issued earlier to reflect the Joint Venture Consortium name. However plaintiff did not re-issue the same instead issued a letter dated 21.02.2014 merely stating that the Joint Venture had been qualified for the bids on the basis of financial credential of consortium member defendant no. 2, however both defendant nos. 1 & 2 shall be liable for the performance of the whole contract. Thus, the above patent error issuing the LOI, Work Order and Contract Agreement was never rectified and hence, the LOI, Work Order and Contract Agreement are bad in law.
CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 12 / 374.6. It is further contended that there is a clear distinction between the "dredged" quantity of sand and the "issued" quantity of sand. According to the Defendants, a plain reading of Clause 2.8 demonstrates that the Plaintiff was under a contractual obligation to mandatorily issue a minimum of 50% of the dredged sand/silt to the Defendants at the rate of Rs. 250/- per cubic meter, which rate is inclusive of royalty.
4.7. The Defendants contend that the clause 2.8 of Contract Agreement does not stipulate, in any manner whatsoever, that the Defendants are liable to deposit royalty on 50% of the total "dredged" quantity of sand. It is their specific case that the obligation to pay at the prescribed rate arises only qua the quantity actually "issued" and not the entire quantity "dredged," as is sought to be alleged by the Plaintiff.
4.8. It is further contended that as per the record relied upon by the Plaintiff itself, the total quantity of sand dredged by the Defendants is stated to be 6,16,773.62 cubic meters. However, the Defendants contend that, in complete contravention of Clause 2.8 of the Technical Specifications & Methodology, the Plaintiff has falsely and wrongfully asserted that the Defendants are liable to deposit royalty on a minimum of 50% of the "dredged" quantity, i.e., 3,08,386.81 cubic meters, calculated at the rate of Rs. 250/- per cubic meter, thereby claiming an amount of Rs. 7,70,96,702.50/-. It is the specific stand of the Defendants that such a claim is wholly misconceived and contrary to the express terms of the tender conditions. The Defendants reiterate that their liability, if any, is confined only to the quantity of sand actually "issued" to them and CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 13 / 37not on 50% of the total "dredged" quantity, as is sought to be alleged by the Plaintiff. According to the Defendants, the Plaintiff has attempted to misinterpret the contractual clause and thereby mislead this Court.
4.9. It is also contended that the Plaintiff, vide letter dated 02.09.2020, has once again raised a demand towards royalty, which is stated to be wholly frivolous and untenable. The Defendants submit that they, vide reply dated 24.09.2020, categorically clarified that the said demand was erroneous and contrary to the Plaintiff's own communication dated 19.08.2019 addressed to the SDM, Karawal Nagar, New Delhi, wherein it was acknowledged that only 2,57,238 cubic meters of sand had been "issued" to the Defendants and not 6,16,773.62 cubic meters as now alleged.
4.10. It is further contended by the defendant that the impugned demand raised by the Plaintiff is illegal, arbitrary and contrary not only to its own admitted documents but also to Clause 2.8 of the Technical Specifications & Methodology of the tender documents. It is their specific case that the said clause clearly stipulates that royalty is linked to the good quality sand actually "issued" to the dredging agency and not to the total quantity dredged. The Defendants assert that, in the present case, only 2,57,238 cubic meters of good quality dredged material has been issued to them till date. 4.11. It is further contended by the Defendant that vide letter dated 25.07.2019, they once again objected to the arbitrary levy of royalty by the Plaintiff and sought an audit of the accounts. The Defendants aver that, since the inception of the contract, they have consistently disputed the royalty amount claimed by the Plaintiff. However, the CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 14 / 37Plaintiff has failed to produce any proof of measurements or any documentary material to demonstrate that it had in fact "issued" 50% of the "dredged" quantity, i.e., 6,16,773 cubic meters of good quality sand, to the Defendants.
4.12. The Defendant further contended that despite repeated follow- ups, necessary permissions for dredging were not being granted, resulting in delays in execution of the project. It is their case that they had invested substantial amounts in manpower and machinery at the project site and suffered losses on account of such delays attributable to the Plaintiff. The Defendants submit that, in the interregnum, the COVID-19 pandemic intervened, due to which the issues remained unresolved for a considerable period. It is further stated that, upon persistent follow-up by the Defendants, a meeting was held between the parties on 22.12.2021 to resolve the disputes pertaining to the alleged outstanding royalty and the issue of permissions for dredging. The Defendants contend that, in the said meeting, the Plaintiff acknowledged that approximately 80% of the work had already been completed by the Defendants. However, it is alleged that the Plaintiff simultaneously raised a demand towards alleged unpaid royalty and threatened that, in case of non-payment, it would terminate the contract, float a fresh tender for the remaining work, forfeit the security deposit and invoke the bank guarantees furnished by the Defendants.
4.13. It is further contended by the defendant that the aforesaid conduct of plaintiff amounted to coercion and abuse of dominant position, leaving the Defendants with no real choice but to accede to the demands of the Plaintiff under protest. It is their case that, under CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 15 / 37such circumstances, they were compelled to agree to the following arrangement towards the alleged royalty:
a) An amount of Rs. 60,00,000/- (Rupees Sixty Lakhs only) was to be adjusted from the security deposit;
b) A further sum of Rs. 20,39,799/- was to be deposited by the Defendants on or before 28.12.2021; and
c) In respect of the balance amount, the Defendants were directed to furnish a bank guarantee for Rs. 53,02,925/-, in addition to the existing bank guarantee of Rs. 14,84,271/- already submitted.
4.14. It is further contended that defendant pursuant to the meeting held on 22.12.2021, a sum of Rs. 20,39,799/- was deposited by them on 06.01.2022 in terms of the understanding arrived between the parties. The Defendants state that, thereafter, vide letter dated 21.01.2022, they sought extension of time till 15.02.2022 for furnishing the additional Bank Guarantee of Rs. 53,02,925/-. However, the Plaintiff failed to respond to the said request. 4.15. The Defendant further contended that the Plaintiff, vide its letter dated 05.01.2022, extended the time for completion of the works up to 30.06.2022. Plaintiff was at all material times aware of the various hindrances affecting the progress of the work and had, from time to time, granted extensions. Defendants further contended that such extensions were granted vide letters dated 11.04.2018, 01.07.2019, 30.12.2019 and 05.01.2022. It is also contended by defendant that the Plaintiff, vide communication dated 10.01.2022, informed them that permission for further dredging had been granted by the competent authority and directed them to mobilize their dredging equipment at the project site. Pursuant thereto, the Defendants commenced CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 16 / 37mobilization of equipment and also intimated the SHO, Wazirabad Police Station, regarding such mobilization vide letter dated 25.01.2022.
4.16. The Defendants further state that, while they were in the process of mobilizing equipment in compliance with the Plaintiff's directions and were also arranging for the requisite Bank Guarantee, the Plaintiff abruptly issued a Termination Notice by way of an e-mail dated 04.02.2022, inter alia terminating Work Order No. 05 (2013-14) dated 27.09.2013 and the consequent Contract Agreement No. 06 (2013-
14), and forfeiting the security deposit and Performance Guarantee furnished by the Defendants. It is further their case that, by the said notice, the Plaintiff also blacklisted/debarred the Defendants from participating in any further tender for the remaining work without issuing any show cause notice or affording an opportunity of being heard.
4.17. According to the Defendants, the Termination Notice dated 04.02.2022 is illegal, arbitrary and untenable in law. It is their specific case that the said termination was issued in complete disregard of the Plaintiff's own communication dated 05.01.2022 granting extension of time till 30.06.2022. The Defendants further contend that the termination is vitiated on the additional ground that permission for dredging had already been granted by the District Magistrate (North- East) vide letter dated 08.12.2021, and pursuant thereto, the Plaintiff itself, vide its communication dated 10.01.2022, directed the Defendants to mobilize their equipment at the site. 4.18. It is further contended by the defendant that the Plaintiff had also informed the SDM, Karawal Nagar, as well as the Station House CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 17 / 37Officers of Sonia Vihar Police Station and Wazirabad Police Station regarding the permission granted by the District Magistrate (North- East) and the consequent mobilization of equipment by the Defendants.
4.19. It is further contended by the Defendants that they have admittedly completed approximately 80% of the work despite facing severe hardships and hindrances at various stages of execution. The Defendants aver that, notwithstanding the additional financial burden, they consistently honoured their contractual obligations and continued with the execution of the works. It is their case that, at the time when the Work Order was abruptly terminated by the Plaintiff, the Defendants were executing the work at the same rates as quoted in the year 2013, despite a substantial increase in input costs, including fuel, equipment and labour. The Defendants further state that they had, at considerable cost and risk, mobilized their equipment at the project site.
4.20. It is also contended by the Defendants that Defendant No. 2 received a notice dated 13.07.2022 from the Plaintiff, whereby a sum of Rs. 38,18,648/- was demanded, allegedly towards dues under Clause 2.8 along with compensation under Clause 10.3 of the Contract Agreement. The Defendants state that the said notice was duly replied to by Defendant No. 2 vide letter dated 05.10.2022, wherein the alleged liability was categorically denied. 4.21. The Defendants further contended that the Plaintiff again issued a notice dated 19.01.2023 raising a similar demand of Rs. 38,18,648/- purportedly under Clause 2.8 along with compensation under Clause 10.3. In response thereto, Defendant No. 2, vide letter dated CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 18 / 3723.02.2023, reiterated its denial of liability and informed the Plaintiff that the matter was already sub judice before the Hon'ble High Court of Delhi in W.P. (C) No. 4636/2022. It is further their case that Defendant No. 2 also pointed out that, from the Plaintiff's own correspondence with the revenue authorities, it was evident that the actual quantity of sand issued to the Defendants was significantly less than what was being claimed. The Defendants accordingly requested the Plaintiff to either issue the balance quantity of sand or refund the excess amount of Rs. 1,09,81,304/- allegedly retained by the Plaintiff.
4.22. It is further contended by Defendants that the Plaintiff thereafter issued another notice bearing No. F2(63)/DJB/EE(Project) W-1/2023/2559 dated 01.12.2023, whereby a fresh demand of Rs. 1,49,68,554/- was raised under Clause 10.3 of the Contract Agreement, being 10% of the total cost of the work order. The Plaintiff further alleged that, after adjusting an amount of Rs. 20,58,579/- (withheld on account of extension of time), the Defendants were liable to pay Rs. 1,29,09,975/-.
4.23. It is further contend by defendant that the said notice dated 01.12.2023 is wholly inconsistent with the earlier notices dated 13.07.2022 and 19.01.2023, wherein a substantially different demand was raised. It is their case that the said notice does not even make reference to the earlier termination notice dated 04.02.2022 or the subsequent notices issued thereafter, nor does it clarify whether the demand raised therein is in continuation of or in addition to the earlier demands.
CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 19 / 374.24. The Defendants further contended that the Plaintiff has deliberately withheld and not placed on record the aforesaid notice dated 01.12.2023 before this Hon'ble Court, thereby concealing material facts and circumstances relevant to the adjudication of the present suit.
5. Plaintiff also filed the replication reaffirming contents of plaint and it is prayed that suit of the plaintiff may be decreed.
6. After completion of pleadings, following issues were framed by the Learned Predecessor on 30.09.2024:-
1) Whether the suit has been filed by a duly authorized person? OPP
2) Whether the plaintiff is entitled to a sum of Rs. 43,15,072/-
towards unpaid Royalty that has accrued to the plaintiff on account of dredging contract in favour of defendants no. 1 and 2? OPP
3) Whether the plaintiff is entitled to interest @ 12% per annum including for the period pendente and future? OPP
4) Whether this court has territorial jurisdiction to try and entertain the present suit? OPP
5) Whether the suit is within limitation? OPP
6) Whether no cause of action has accrued to the plaintiff for filing the present suit? OPD 2.
7) Whether the defendant no. 2 is not liable to make any payment on account of default, if any, on the part of the defendant no. 1? OPD 2.
8) Whether the liability of the defendants no. 1 and 2 towards the dues of the plaintiff, if at all any, is not joint and several? OPD
2.
9) Relief.
7. I have heard arguments advanced by Sh. Naresh Sharma, Learned Counsel for the plaintiff and Sh. Sukhmeet Singh, Learned Counsel for the defendant no. 2 and perused the record carefully including written submissions.
CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 20 / 378. Now I take up the issue no. 1 which reads as under:-
Whether the suit has been filed by a duly authorized person? OPP 8.1 Onus to prove this issues is fixed upon plaintiff, plaintiff in order to discharge the said onus examined Sh. L.L. Meena Executive Engineer (Project) Water-I, Varaunalaya Complex, Delhi Jal Board, New Delhi as PW-1 who tendered his evidence by way of affidavit Ex. PW1/A and relied upon the documents i.e. Ex. PW1/1 to Ex. PW1/29.
8.2 During the course of arguments, counsel for the defendant submitted that present suit has been filed through one Mr. Sudesh Jain, but no valid authorization in his favour has been shown by the plaintiff. Even plaintiff witness i.e. PW-1 admitted in the course of cross-examination that he cannot tell without consulting the records, as to whether the authority letter/office noting/ resolution or any permission in favour of Sh. Sudesh Jain Executive Engineer has been placed on record or not. It is prayed by the counsel for defendant no. 2 that present suit is not maintainable in the absence of any valid authorization in favour of Sh. Sudesh Jain.
8.3 On the contra, Learned Counsel for the plaintiff submitted that plaintiff being a Government agency (DJB) had awarded work order bearing no. 05(2013-14) dated 27.09.2013 Ex. PW1/1 to the defendants for dredging of silt from the river Yamuna near Intake at Wazirabad Water Works. Since defendants made the defaults in payment and violated the terms and conditions of the contract, therefore, present suit has been filed by the plaintiff through Sh.
Sudhesh Jain Executive Engineer (Project) Water-I, Varaunalaya CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 21 / 37Complex, Delhi Jal Board, New Delhi. It is further submitted that since the said Executive Engineer had retired from the service therefore, he could not appear before the court to depose or to show his authorization to file the present suit. However, another Executive Engineer appeared before the Court and deposed as a PW-1 who brought the authority of competent authority to depose before the Court and same was approved by the Chief Engineer. It is further submitted that DJB is a Government agency and its Executive Engineer being a public servant was also authorized by the department through a circular dated 02.09.2016 issued by plaintiff/DJB, therefore, claim of the plaintiff cannot be rejected solely on the ground of non filing of said circular/authority letter in favour of Executive Engineer namely Sh. Sudesh Jain (Retd.). 8.4 After having gone through the submissions advanced by counsels of both the parties and perusal of the record, I find that Mr. Sudesh Jain was an Executive Engineer of the plaintiff who signed the pleadings, affidavit and statement of truth. Since he has retired from the service, therefore, he has not appeared in the witness box for proving the documents of plaintiff and his authorization. However, another Executive Engineer namely Sh. L.L. Meena (PW-1) appeared in the witness box alongwith his authorization for proving the documents and contract.
8.5 It is to be noted here that counsel for plaintiff also moved an application under Section 151 of CPC for filing additional documents i.e. a circular dated 02.09.2016 issued by plaintiff/DJB which authorized the Executive Engineer of the concerned department to sign the original petition/reply etc., for filing the papers before the CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 22 / 37District Court. The said authorization is annexure A. The said application was dismissed by this Court by observing that such application cannot be moved at the stage of final arguments. 8.6 It is settled law that where suits are instituted or defended on behalf of a public corporation, public interest should not be permitted to be defeated on a mere technicality. Procedural defects which do not go to the root of the matter should not be permitted to defeat a just cause. There is sufficient power in the Courts, under the Code of Civil Procedure, to ensure that injustice is not done to any party who has a just case. As far as possible a substantive right should not be allowed to be defeated on account of a procedural irregularity which is curable. Reliance is placed upon the law laid down in case titled as United Bank of India Vs. Sh. Naresh Kumar & Ors decided by Hon'ble Supreme Court on 18th September, 1996.
8.7 In the light of the law laid down in United Bank of India case (Supra) and the fact that Sh. Sudesh Jain Executive Engineer (now retired) being a public servant signed pleadings, statement of truth and affidavit of admission/denial, therefore, it can be inferred that he was the authorized person to file the present suit on behalf of plaintiff. Accordingly, this issue is decided in favour of plaintiff and against the defendants.
9. Now coming on the issue no. 5 which reads as under:
Whether the suit is within limitation? OPP 9.1 Onus to prove this issues is upon plaintiff, plaintiff in order to discharge the said onus examined Sh. L.L. Meena Executive Engineer (Project) Water-1, Varaunalaya Complex, Delhi Jal Board, New Delhi CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.Page no. 23 / 37
as PW-1 who tendered his evidence by way of affidavit Ex. PW1/A and relied upon the documents i.e. Ex. PW1/1 to Ex. PW1/29. 9.2 During the course of arguments, counsel for defendant submitted that plaintiff is claiming royalty for the dredged sand issued to the defendants upto the year 2018. Moreover, plaintiff's witness has admitted in his cross-examination that the amount claimed in the present suit accrued during the period 03.10.2013 to 30.06.2018. If the cause of action to file the present suit is atleast taken from 30.06.2018, the present suit is barred by limitation despite giving them benefit of suo moto order dated 10.01.2022 passed by the Hon'ble Supreme Court in "Recognizance for extension of limitation".
9.3 On the contra, counsel for plaintiff has vehemently opposed the said arguments stating that subject work was in progress till 30.06.2018 but the defendant did not complete the entire awarded work, therefore, plaintiff in order to keep the contract alive granted provisional extension of the time for completion of work. Counsel for plaintiff in support of his arguments has drawn the attention of the court on various correspondence between the parties, particularly, letter dated 09.07.2019, 22.07.2019, 13.09.2019, 11.10.2019, 30.10.2019, 03.12.2019, 27.01.2020, 12.02.2020, 02.09.2020, 08.10.2020 & 03.11.2020 regarding balance payment against the dredged material to the tune of Rs. 2,08,27,002/-. It is further submitted that a request letter of the defendant for granting extension of the time (EOT) upto 30.06.2021 vide Letter no.
CSIPL/ASR/DJB/07/2020 dated 15.10.2020 was also received and the said fact is also mentioned in letter dated 03.12.2020 Ex. PW1/16. CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 24 / 37In view of the aforesaid facts and circumstances, particularly, from the date of completion of work sought by defendant in their EOT i.e. 30.06.2021, the suit of plaintiff is within period of limitations. 9.4 After having gone through the submissions of counsels of both the parties, I find that it is admitted fact that date of start of work was 03.10.2013 and said work was in progress till 30.06.2018. It is also admitted fact that the stipulated quantity of silt/sand could not be dredged by defendant till 30.06.2018, therefore, defendant applied for the extension of time (EOT) upto 30.06.2021 vide letter dated 15.10.2020. Plaintiff also issued a reminder letter dated 03.12.2020 Ex. PW1/16 to the defendants for balance payment of Rs. 2,08,27,002/- as well as about the request of extension of time (EOT) of defendant. The aforesaid fact was also deposed by the plaintiff's witness (PW-1) but there is no cross-examination of the said witness by defendant on the point of EOT applied by the defendant till 30.06.2021. It means that there is no dispute of EOT applied by the defendant till 30.06.2021. If the period of limitation is computed from the date of completion of work sought by defendant in EOT i.e. 30.06.2021 even then suit of plaintiff is within period of limitation. With these observations, I am of the considered view that suit of plaintiff is within the period of limitation. Accordingly, this issue is decided in favour of plaintiff and againt the defendants.
10. Now coming on the issue nos. 2 & 3 which are interconnected to each other. Accordingly, both are taken together. The same are as under:
Issue No. 2: Whether the plaintiff is entitled to a sum of Rs. 43,15,072/- towards unpaid Royalty that has accrued to the CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.Page no. 25 / 37
plaintiff on account of dredging contract in favour of defendants no. 1 and 2? OPP Issue No. 3: Whether the plaintiff is entitled to interest @ 12% per annum including for the period pendente and future? OPP 10.1 Onus to prove these issues were fixed upon the plaintiff.
Plaintiff in order to discharge the said onus examined Executive Engineer i.e. PW-1 who tendered his evidence by way of affidavit Ex. PW1/A and relied upon following documents:-
1. Copy of the contract agreement regarding work order bearing no. 05 (2013-2014) dated 27.09.2023 as PW-1/1;
2. Letter dated 23.01.2014 as PW-1/2;
3. Letter dated 21.02.2014 as PW-1/3;
4. Letter dated 18.10.2016 as PW-1/4;
5. Letter dated 09.07.2019 as PW-1/5;
6. Letter dated 22.07.2019 as PW-1/6;
7. Minutes of meeting dated 20.09.2019 as PW-1/7;
8. Letter dated 11.10.2019 as PW-1/8;
9. Letter dated 30.10.2019 as PW-1/9;
10. Letter dated 03.12.2019 as PW-1/10;
11. Letter dated 27.01.2020 as PW-1/11;
12. Letter dated 12.02.2020 as PW-1/12;
13. Letter dated 02.09.2020 as PW-1/13;
14. Letter dated 08.10.2020 as PW-1/14;
15. Letter dated 03.11.2020 as PW-1/15;
16. Reminder letter dated 03.12.2020 as PW-1/16;
17. Reminder cum final notice dated 01.03.2021 as PW-1/17;
18. Letter dated 01.12.2021 as PW-1/18;
19. Minute of meeting held on 22.12.2021 stated in the letter dated 27.12.2021 as PW-1/19;
20. Letter dated 05.01.2022 as PW-1/20;
21. Internal correspondence of the plaintiff department dated 02.02.2022 as PW-1/21;
22. Noting of CEO of the plaintiff department/ DJB as PW-1/22;
23. Termination notice dated 04.02.2022 as PW-1/23;
24. letter dated 10.02.2022 written by DJB to Federal Bank Ltd. as PW-1/24;
25. Letter dated 13.07.2022 as PW-1/25;
CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 26 / 3726. Final notice for deposit of pending royalty dated 19.01.2023 as PW-1/26;
27. Reply to the letter dated 19.01.2023 by defendant no. 2 vide its letter dated 23.02.2023 as PW-1/27;
28. Non Starter Report dated 14.07.2023 as PW-1/28 and Certificate under Section 63 of BSA as PW-1/29.
10.2 The first and foremost contention of the defendant no. 2 is that as per clause 2.8 of the Contract Agreement, it was mandatory for the plaintiff to issue 50% of the dredged sand to defendant but plaintiff has not issued the 50% quantity of the sand in terms of the aforesaid clause to defendants. Therefore, demand of the plaintiff towards royalty is illegal and arbitrarily. However, total quantity of sand actually issued to the defendant upto 30.06.2018 was only 2,57,238 cubic meter which is significiantly less than 50% of the total dredged quantity of 6,16,773.6 cubic meter. Therefore, they are not liable to pay the royalty on 50% of dredged quantity i.e. 3,08,386.81 cubic meter.
10.3 The said argument is vehemently opposed by the counsel for the plaintiff stating that the contractor/defendants upto 30.06.2018 had dredged quantity of 6,16,774 cubic meter against the stipulated quantity of 7,79,740 cubic meter as per Bill of Quantity (BOQ) of the work and balance dredging work was not done by the contractor company despite several reminders. Even the meeting of both the parties were also held at the office of plaintiff on 13.09.2019 & 22.12.2021 which is reflected in the minutes of meetings Ex. PW1/7 & Ex. PW1/19 wherein both the directors of defendants companies were apprised to deposit the minimum balance of Rs. 2,08,27,001/- @ 50% of dredged quantity as per contract agreement. It is further CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 27 / 37submitted that defendants had neither taken the permissions from the authority concerned nor paid the balance royalty amount to the plaintiff. Therefore, plaintiff is entitled for the suit amount. 10.4 Before the dealing with the submissions of counsels for both the parties, it would be appropriate to refer some relevant terms and conditions of contract which read as under:-
2.8 It is expected that good quality sand is likely to be dredged out. The dredged sand/silt will be issued to the dredging agency @ Rs. 250/- per Cum. Before issue of dredged sand the bidder has to deposit the money with DJB for the requested quantity at above specificed rates or may request for recovery from the running bills. The issue rate includes royalty. Any other cost is to be borne by the bidder. The bidder has to take all required permission from concerned authorities No claim whatsover will be entertained on this account.
Minimum 50% quantity of dredged sand/silt is mandatory to be issued to the dredging agency.
10.5 A bare perusal of the said terms and conditions of the contract, firstly, it is apparent that the dredged sand/ silt has been issued @ Rs. 250 per cubic meter. Secondly, the issue rate also includes royalty. Thirdly, the bidder (defendants) have to take all the required permissions from the concerned authority i.e. District Magistrate and fourthly, the minimum 50% of quantity of dredged sand/silt is mandatorily to be issued to the dredging agency. 10.6 It is not disputed that defendant company could not dredge the stipulated quantity i.e. 7,79,740 cubic meter within the stipulated period i.e. upto 30.06.2018. However, they dredged the quantity of 6,16,773.62 cubic meter as per Measurement Book Ex. PW1/D1 which has been proved by PW-1. In the said measurement book, CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 28 / 37defendant had signed and accepted the bill and measurements with the seal of the defendant.
10.7 It is to be noted here that plaintiff made several correspondence to the defendants regarding depositing of balance amount and take permissions from the authority concerned, i.e. District Magistrate. Defendant no. 2 almost admitted the said correspondence made by the plaintiff i.e. Ex. PW1/5 to Ex. PW1/26 to it. Relevant extract of some of the letters and meetings are reproduced for appreciating the facts.
Letter dated 27.01.2020 Ex. PW1/11:
As per clause 2.7 of agreement which is again reiterated as under:
"the bidder has to take all required permissions from the concerned authorities. No claim whatsoever will be entertained in this account."
It was also reiterated and intimated by means of letter dated 03.12.2019 but no action has been initiated by agency. The work has stopped due to non action on the part of agency. Therefore, it is once again requested to take permissions and to execute the balance work as per provision of contract conditions after depositing the balance amount as described above.
Meeting dated 13.09.2019 Ex. PW1/7.
• As per contract conditions, minimum 50% of the dredged quantity shall be issued to the contractor and to be recovered @ Rs. 250 per cubic meter. Therefore, at least 3,08,387 cum of quantity @ Rs. 250 cum for cost of Rs. 7,70,96,750/- out of total dredged quantity 6,16,774 cum is to be recovered from the agency. An amount of Rs. 5,62,69,701/- has only been recovered from the agency till date. The agency has repeatedly been requested to deposit the minimum required amount as per CA but same has not been complied with.
• The balance dredged quantity of silt lying at the site shall be assessed by the agency and intimated. Permission of DM (North-East) for lifting of already dredged material shall accordingly be requested. On receipt of the permission from DM (North-East) agency shall be permitted to lift the dredged material and clearance of the site subject to ensuring balance payment.
Minutes of meeting held on 22.12.2021 Annexure -19 Ex. PW1/19.
CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 29 / 371. Adjustment of Rs. 60,00,000/- from the security deposit of Rs. 74,84,227/- of the work against percentage of performed work (approx 80% completed) toward lifted quantity. Balance security deposit of Rs. 14,84,227/- will be available with DJB for balance work.
2. The agency will deposit the balance amount of Rs. 20,39,799/- royalty for lifted quantity before 28.12.2021.
3. The performance bank guarantee amounting to Rs. 74,84,277/- will be extended by agency up to 30.06.2022 which will be considered as guarantee for the balance royalty @ 50 % of dredged quantity as per CA.
4. The agency will provide bank guarantee for the remaining amount of Rs. 53,02,925/- (1,27,87,202 - 74,84,277) valid up to 30.06.2022 as per CA condition of 50% of dredged quantity within 10 days.
5. Orders for commencement of work will be issued subject to the conditions that the agency will honor the commitments as above.
6. An undertaking to be taken from the agency regarding above.
7. Undertaking to be given by the agency to execute the balance work on the same terms and conditions of CA without any escalation and claim for idle labour and machinery etc. 10.8 A bare perusal of the aforesaid correspondence and meetings held between both the parties, it is apparent that plaintiff had repeatedly told defendants to not only deposit the balance royalty amount of 50% of dredged quantity as per contract conditions but also informed to start the remaining dredging work after taking necessary permissions from the District Magistrate. Further, it has also been proved by the plaintiff that defendant had neither taken the permission from the authority concerned for further dredging of sand, particularly, after 30.06.2018 nor deposited the balance royalty @ 50% of the minimum dredged sand. It is further to be noted here that defendant no. 1 remained ex-parte in the present case but its director always joined the meetings of plaintiff held on 13.09.2019 & 22.12.2021 vide Ex. PW1/7 & Ex. PW1/19 respectively and defendant no. 1 was well aware about the outcome of the said meetings. Further, defendant no. 2 has also not led any evidence in CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 30 / 37support of its contentions. In view of the aforesaid facts and circumstances, I am of the considered view, since defendant failed to start the remaining dredging work after 30.06.2018 for want of permissions and for depositing the balanced royalty @ 50% of dredged sand, therefore, plaintiff is entitled to recover @ 50% of the already dredged material i.e. 6,16,773.62x50%=3,08,386.81 cum @ Rs. 250 = Rs. 7,70,96,702/-. Since plaintiff has already recovered Rs. 7,32,78,054/- from the defendants, therefore, plaintiff is entitled to recover remaining amount of Rs. 38,18,648/-. Plaintiff is also entitled for the interest @ 12% per annum from 13.07.2022 till 13.08.2023 for 13 months amounting to Rs. 4,96,424/- and thus the total amount legally recoverable from the defendants at the time of filing of the case comes to Rs. 43,15,072/-. As far as pendentelite and future interest @ 12% is concerned, I am of view that same is exhorbitant. However, in the interest of justice, plaintiff is awarded pendentelite and future interest @ 8% per annum from the date of filing of suit till the date of realisation of the decretal amount of Rs. 43,15,072/- alongwith cost of the suit. With these observations, both issue nos. 2 & 3 are decided in favour of plaintiff and against the defendants.
11. Now coming on the issue no. 4 which reads as under:-
Whether this court has territorial jurisdiction to try and entertain the present suit? OPP 11.1 Onus to prove this issue was upon the plaintiff, plaintiff in order to discharge the said onus examined Sh. L.L. Meena Executive Engineer (Project) Water-1, Varaunalaya Complex, Delhi Jal Board, New Delhi as PW-1 who tendered his evidence by way of affidavit CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.Page no. 31 / 37
Ex. PW1/A and relied upon the documents i.e. Ex. PW1/1 to Ex. PW1/29.
11.2 During the course of arguments, counsel for the plaintiff submitted that head office of plaintiff falls within the territorial jurisdiction of this court where the agreement was duly executed between the parties. Further, the work was also executed in Delhi. Even meetings regarding work order were also held between the parties at the office of the plaintiff. Accordingly, this court has territorial jurisdiction to try and entertain the present suit. 11.3 It is to be noted here that counsel for defendant has not addressed the arguments on this point.
11.4 Perusal of the entire case file, I find that contract executed between the parties at the office of plaintiff which is situated within the jurisdiction of this Court. Even work was also executed in Delhi, therefore, this court has jurisdiction to try and entertain the present suit. Accordingly, this issue is decided in favour of plaintiff and against the defendant.
12. Now coming on the issue no. 6 which reads as under:-
Whether no cause of action has accrued to the plaintiff for filing the present suit? OPD 2 12.1 Onus to prove this issue was upon the defendant no. 2. No evidence has been led by the defendant no. 2. As I have discussed in issue nos. 2 & 3 by observing the fact that defendants are liable to pay the suit amount alongwith the interest to the plaintiff, therefore, there is a cause of action in the present suit against the defendants.
Accordingly, this issue is also decided in favour of plaintiff and against the defendants.
CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 32 / 3713. Now coming on the issue nos. 7 & 8 which are interconnected to eachother. Accordingly, both are taken together. The same are as under:-
Issue No. 7: Whether the defendant no. 2 is not liable to make any payment on account of default, if any on the part of defendant no. 1? OPD 2 Issue No. 8: Whether the liability of defendant no. 1 & 2 towards the dues of plaintiff, if at all any, is not joint and several? OPD 2 13.1 Onus to prove these issue were upon the defendant no. 2. No evidence has been led by the defendant no. 2. Perusal of the case file, I find that plaintiff being a Government agency had awarded work order bearing no. 05(2013-14) dated 27.09.2013 to M/S Chinar Shipping and Infrastructure Pvt. Ltd./Defendant no. 1 wherein it was the leading partner and it has joint venture agreement for consortium with the defendant no. 2/M/S ASR Dredging Services Pvt. Ltd., for dredging of slit from the river Yamuna near Intake at Wazirabad Works within the period of eight months. The said copy of the contract agreement is Ex. PW1/1. Further, it has also been brought on record that plaintiff received one letter dated 23.01.2014 from defendant no. 2 whereby stating that defendant no. 1 had entered into a joint venture agreement with their company and unfortunately the name of defendant no. 2 was missed out for the correspondence made by the plaintiff during the issuance of letter of intent (LOI), the said letter dated 23.01.2014 is Ex. PW1/2. It is further brought on record by letters dated 21.02.2014 Ex. PW1/3 and 18.10.2016 Ex. PW1/4 that both the members shall be jointly and severely liable for performing whole contract. It is to be noted here that no substantive CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.Page no. 33 / 37
arguments has been raised by counsel for defendant no. 2 regarding joint liability of both the companies. However in the written submissions of defendant no. 2, particularly, at para 3, it is mentioned that "bid submitted by defendant no. 1 was accepted by the plaintiff. Accordingly, plaintiff issued the letter of Intent dated 29.08.2013 (LOI) and work order bearing no. F2(63)/EE(Project)W-I/2013/2803 to 2822 (Work Order) only in the name of defendant no. 1 and not in the name of consortium. Thereafter, the plaintiff also entered into a contract agreement dated 15.10.2013 (The Agreement only with the defendant no. 1) leaving out the defendant no. 2. Later the plaintiff issued a letter dated 21.02.2014 stating that joint venture had been qualified for the bids based on financial credential of defendant no. 1 and technical credentials of consortium members of defendants i.e. defendant no. 2."
13.2 In order to deal the said submissions of counsel for defendant no. 2, it is to be appropriate to reproduce the relevant part of the letter dated 23.01.2014 Ex. PW1/2 issued by defendant no. 2. The same is as under:-
"Hence, it is requested that the Letter of Intent and Work order issued earlier be amended accordingly to reflect our joint venture Consortium name which is ASR Dredging Services Pvt Ltd and Chinar Shipping and Infrastructure Consortium. Also please issue all the future correspondence/cheques etc. in the name of the Joint Venture Consortium and copy to ASR Dredging Services Pvt Ltd as our firm is also jointly responsible for the execution during the entire project as per NIT."
CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 34 / 3713.3 In the response of the said letter Ex. PW1/2 issued by defendant no. 2, plaintiff also issued a letter dated 21.02.2014. The relevant part of letter dated 21.02.2014 is reproduced hereunder:-
"This has reference to your letter no.
CSIIP/DJB_002/20/2014 dt. 20.01.14 and letter no. NIL DT 23.01.14 of your JV partner. It is to inform that subjected work has been allotted to Join Venture of M/S Chinar Shipping & Infrastructure (India) Pvt. Ltd and M/S ASR dredging services pvt. Ltd vide above referred work order. As per Joint Venture agreement with M/s ASR dredging services Pvt. Ltd submitted by you with technical bid on behalf of JV being part of CA at p.no 203-
4. M/S Chinar Shiping & Infrastructure (India) Pvt. Ltd has been nominated as lead partner for consortium who had submitted bids on behalf of the consortium. It is further to clarify that as per clause 3.0 of Instruction to bidders (Joint Venture) conditions and conflict of interest which is also part of Contract Agreement at p.no. 65, Lead member of consortium nominated by the other members to lead the project in terms of responsibilities as well as to act as primary interface between the employer and the consortium. Accordingly work order was issued in the name of lead partner i.e. M/S Chinar Shiping & Infrastructure (India) Pvt. Ltd and the payments are being made to account mentioned in the mandate along with other correspondence being made with them. However, it is to confirm that your joint venture had been qualified for the bids on the basis of financial credential of lead partner i.e. M/S Chinar Shiping & Infrastructure (India) Pvt Ltd and technical credential of consortium member i.e. M/S ASR dredging services Pvt. Ltd however both members of the group shall be jointly and severelly liable for the performance of whole contract."
13.4 A bare perusal of the letter of defendant no. 2 dated 23.01.2014 Ex. PW1/2, it is apparent that defendant no. 2 itself stated that "our firm is also jointly responsible for the execution during the entire CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 35 / 37project as per NIT". Further, defendant no. 2 also requested in the said letter to the plaintiff for issuing correspondence/cheques etc., in the name of Joint Venture Consortium. In the response of said letter of defendant no. 2 and letter dated 20.01.2014 of the defendant no. 1, plaintiff specifically replied vide letter dated 21.02.2014 Ex. PW1/3 that both members of the group shall be jointly and severely liable for the performance of whole contract. In view of the both letters of defendant no. 2 & plaintiff Ex. PW1/2, Ex. PW1/3 & Ex. PW1/4 and material on record, it can be easily inferred that both the defendants are jointly and severely liable for the performance of whole contract and accordingly, they are liable for the payment of decretal amount of Rs. 43,15,072/- alongwith pendentelite and future interest. With these observations, both these issue nos. 7 & 8 are also decided in favour of plaintiff and against the defendants.
14. RELIEF:
In view of above discussion, the suit of the plaintiff is decreed in the following manner:
(i) Plaintiff is entitled for the decree for a sum of Rs.
43,15,072/- against both the defendants (Principal amount of Rs. 38,18,648/- and interest @ 12% per annum from 13.07.2022 till 13.08.2023 for 13 months amounting to Rs. 4,96,424/-).
(ii) Plaintiff is also entitled for pendentelite and future interest @ 8% per annum.
(iii) Plaintiff is also entitled for the cost.
CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors.
Page no. 36 / 3715. Decree-sheet be prepared accordingly. File be consigned to Record Room after necessary compliance.
Digitally signed RAM LAL by RAM LAL MEENA MEENA Date: 2026.03.30 16:13:06 +0530 Announced in the open Court (R.L. Meena) th on 30 March, 2026 District Judge (Commercial Court-06) Central, Tis Hazari Courts, Delhi(v) CS No. 1629/2023 Delhi Jal Board vs. M/S Chinar Shipping & Infrastructure Pvt. Ltd & Ors. Page no. 37 / 37