Delhi District Court
Shobit Bansal vs Municipal Corporation Of Delhi on 9 August, 2024
IN THE COURT OF AMIT KUMAR : DISTRICT JUDGE
(COMMERCIAL)-08
TIS HAZARI COURTS, CENTRAL: DELHI
(Commercial Case No. 1217/2023)
CNR No. DLCT01-012200-2023
SHOBIT BANSAL
SOLE PROPRIETOR OF
M/S S.B. CONST. CO.
D-238, ASHOK VIHAR, PHASE-1,
DELHI-110052
.....PLAINTIFF
VS
MUNICIPAL CORPORATION OF DELHI
THROUGH ITS COMMISSIONER
CIVIC CENTRE, MINTO ROAD,
NEW DELHI-110002
....DEFENDANT
Date of institution of case : 04.09.2023
Date of arguments : 23.07.2024
Date of pronouncement of judgment : 09.08.2024
JUDGMENT:
1. Present is a suit seeking recovery of Rs. 51,00,987/- along with interest @ 12% per annum and the brief facts necessary for disposal of this suit as averred in the plaint are that the plaintiff is an enrolled contractor with MCD/defendant and was awarded eight work orders nos. 232 dated 21.02.2020, 202 and 204 dated 01.01.2019, 168 dated 29.11.2018, 190 dated 03.01.2020 and 125, 126, 127 all dated 08.03.2020. It is stated that immediately after the award of the work orders, the plaintiff executed the work orders to the satisfaction of the defendant within the prescribed period of defect liability without any negative remark. Defendant completed the final measurement of the respective -1- work orders and prepared and passed the running and final bills pertaining to these work orders on different dates. Despite passing the respective bills, the payment has not been released despite several requests. The plaintiff also served the legal notice dated 22.10.2022 calling upon the defendant to release the principal amount of Rs. 42,15,659/- consisting of the bills amount of Rs. 37,97,599/- and security & earnest money of Rs. 4,18,060/-. The defendant did not release any money, hence this suit has been filed seeking recovery of the bills amount, security amount, earnest money and interest accrued thereon @ 12% per annum.
2. The defendant in the written statement did not dispute the award of the work orders to the plaintiff. It was, however, claimed that the plaintiff has not submitted bills for payment as required under the contract and has not complied with the clause 7, 9, 17 and 45 of the General Contract Clauses (GCC) and 4B of the Work Order and therefore, is not entitled to suit amount. It was stated that the plaintiff did not submit labour clearance certificate as required. It was claimed that suit is pre mature as submissions of bills is pre-requisite and essential for payment and failure to submit the bills on the part of plaintiff renders him illegible for the suit amount.
3. In the replication, the contents of the written statement were disputed and that of the plaint were reiterated.
4. On the pleadings of the parties, following issues were framed on 21.02.2024:
1. Whether plaintiff is entitled to recovery of the suit amount ?OPP -2-
2. Whether plaintiff is entitled to interest? If yes, at what rate and for what period? OPP
3. Whether the suit is liable to be dismissed for non compliance of Clause 4, 7, 9, 17 and 45 of GCC? OPD
4. Relief.
5. The plaintiff to prove its case examined himself as PW1 whereas the defendant examined its Assistant Engineer as the sole witness.
6. I have heard the submissions and have perused the record and my findings on the issues is as under:
ISSUE NO. 1 & 2:
7. The onus of proving both these issues was on the plaintiff.
The plaintiff in his examination in chief, proved on record the copy of the work orders as Ex. PW1/1 to PW1/8, copy of the final bills of all the work orders as Ex. PW1/9 to PW1/14 & PW1/16 and the copy of the first running bill of work order no. 126 as Ex. PW1/15, the legal notice as Ex. PW1/17 and copy of the relevant pages of GCC as Ex. PW1/18. In the brief cross examination, the witness admitted that all the terms and conditions of the work order were accepted by him. He did not submit the labour clearance certificate. He denied the suggestion that he did not submit the final bills alongwith measurement with the defendant. He denied the suggestion that suit is not maintainable for want of compliance of condition no. 4B of the work order and for not submitting the labour clearance certificate.
8. The defendant witness in his examination in chief reiterated the contents of the written statement and proved on record the notice inviting tenders as Ex. DW1/1 to DW1/5, the -3- award of the work orders as Ex. DW1/6 to DW1/13 and the terms and conditions of the work orders and GCC as Ex. DW1/14. In the cross examination, he admitted that the plaintiff completed all the work orders to the satisfaction of the defendant but no money has been released. He admitted that bills have been passed at the end of the defendant. He admitted that the defendant has passed all the bills as per entries made in the measurement book, which were accepted by the plaintiff. The bills were passed on the basis of site inspection and measurement book. He admitted that no labour complaint is pending. He admitted that defendant has not made any payments to the plaintiff for these work orders.
9. It was argued by Ld. Counsel for the plaintiff that the plaintiff completed the work order(s) to the satisfaction of the defendant. The defendant has prepared the bills but did not release the payment and therefore, the plaintiff is entitled to the suit amount alongwith interest. It was argued that as per Clause 9 of the GCC, the defendant was bound to make the payment within six months, if the tender value is upto Rs. 5 Lac and within nine months, if it exceeds Rs. 5 Lac and since no payment has been made by the defendant as per GCC, the plaintiff is entitled to the bills amount, refund of security and earnest money with interest.
10. On behalf of the defendant, it was argued that the suit is pre mature as the plaintiff did not submit the bills alongwith measurement nor the labour clearance certificate and therefore, the defendant is not liable to pay any money to the plaintiff. Counsel for the defendant in support of his submission relied upon the judgement of Hon'ble Delhi High Court passed in -4- North Delhi Municipal Corporation Vs. Sanjeev Kumar, RFA No. 430/2017 decided on 22.03.2018.
FINDINGS:
11. As far as the execution of the work orders is concerned, the same is undisputed. DW1 in the cross examination, admitted that the entire work of the work orders were completed by the plaintiff to the satisfaction of the defendant. He admitted that no labour complaint is pending and also that final bills of all the work orders and the first running bill of the work order no. 126 were passed on respective dates. When the defendant has already passed the bills of the plaintiff, it cannot be argued for the defendant that the plaintiff is not entitled to the suit amount as he did not complied with the clause 4B of the work order or other terms and conditions of GCC.
12. The perusal of the judgement passed by Hon'ble Delhi High Court in North Delhi Municipal Corporation Vs. Sanjeev Kumar (supra) shows that it nowhere mandates that the plaintiff is required to submit the bills only on his letter head and only in his handwriting. The plaintiff proved on record the final and running bill(s) passed by the defendant. All the bills bear the signatures of the plaintiff at the relevant space provided in the bills. It means that the plaintiff accepted the bills prepared and passed by the defendant and signed the same as token of acceptance. DW1 admitted in the cross examination that the bills were prepared on the basis of site inspection and measurement book. If that is so, then what was the requirement of the plaintiff to submit the bills. Otherwise also, in the judgement relied upon, the Hon'ble High Court gave several directions to the defendant as well such as photography, videography, maintaining of record -5- digitally etc. Even after considerable time of this judgement, the defendant has failed to comply with these directions. The defendant cannot claim the compliance of this judgement regarding submitting bills by contractor alone without complying with the directions given to the defendant. When the defendant itself failed to comply with directions given in this judgement, it cannot be argued that the plaintiff should diligently comply with the directions of this judgement. The facts that the plaintiff signed the bills and accepted the bills, give rise to the presumption that there was due compliance of the directions of Hon'ble High court given in this judgement. The plaintiff, therefore, is entitled to the bills amount.
13. Coming to the aspect of return of the security deposit, it was argued for the defendant that the plaintiff did not submit the labour clearance certificate as per clause 45 of the GCC and therefore, is not entitled to the refund of security amount. In this regard, cross examination of DW1 is relevant. DW1 admitted in the cross examination that no labour complaint is pending. As per record, the defendant passed the bills between 26.03.2019 till 06.06.2022 and considerable time has passed since then. When no labour complaint is pending against this work order, the defendant cannot withheld the security deposit only because there is no labour clearance certificate.
14. Coming to the aspect of interest, the plaintiff has claimed interest @ 12% on the entire amount from 01.10.2021. Counsel for the defendant argued that there was no term and condition regarding payment of interest and therefore, plaintiff is not entitled to any interest. The law in this regard has already been settled by Hon'ble Delhi High Court in the case of North Delhi -6- Municipal Corporation Vs. Vipin Gupta in RFA No. 160/2017 and the SLP against this order was dismissed by Hon'ble Supreme Court. This judgment was further confirmed by the Hon'ble Division Bench of Hon'ble Delhi High Court in the case of North Delhi Municipal Corporation Vs. M/s. Barahi Construction passed by Hon'ble Delhi High Court in RFA (Commercial) 06/2021 dated 15.03.2021. In view of these judgments, the plaintiff is entitled to interest on the bill amount but not from 01.10.2021 on all the bills as claimed by the plaintiff. Record shows that some of the bills were cleared even in May and June, 2022. Plaintiff cannot claim interest on these bills from 01.10.2021 as claimed in para 10 of the plaint. Plaintiff did not submit bills and same were prepared by defendant. The plaintiff, therefore, shall be entitled to interest @ 9% per annum on the bills amount after expiry of six and nine months from the date of the bill depending upon the amount of the bill i.e. after six months for the bill of less than Rs. 5 Lac and after nine months for the bill, which is more than Rs. 5 Lac.
15. As far as the security amount and earnest money is concerned, the plaintiff shall be entitled to interest @ 6% per annum on this amount from the date of the suit till till realization.
16. The plaintiff has, therefore, proved these issues in his favour as discussed above.
ISSUE NO. 3:
17. The onus of proving this issue was on the defendant. It was argued for the defendant that the plaintiff failed to meet out the terms and conditions of the notice inviting tender as he did not submit the final bills. As already discussed, the bills bear the signatures of the plaintiff and were passed by the defendant after -7- completion of all the formalities as admitted by DW1. DW1 admitted in the cross examination that the bills were cleared after going through all the relevant documents like measurement book, site inspection etc. If the plaintiff did not fulfill the conditions of the tender as argued, then why the bills were passed remains unanswered. The defendant, therefore, has failed to prove the issue.
RELIEF:
18. In view of my finding given on the above said issues, plaintiff shall be entitled to a decree for a sum of Rs. 42,15,659/-.
a) Plaintiff shall also be entitled to interest @ 9% on the amount of Rs. 1,70,190/- (work order no. 168) from 26.09.2019 till realization as bill was passed on 26.03.2019.
b) Plaintiff shall also be entitled to interest @ 9% on the amount of Rs. 3,41,917/- (work order no. 190) from 27.11.2020 till realization as bill was passed on 27.05.2020.
c) Plaintiff shall also be entitled to interest @ 9% on the amount of Rs. 4,28,114/- (work order no. 202) from 30.06.2021 till realization as bill was passed on 30.12.2020.
d) Plaintiff shall also be entitled to interest @ 9% on the amount of Rs. 4,27,862/- (work order no. 204) from 01.07.2021 till realization as bill was passed on 31.12.2020.
e) Plaintiff shall also be entitled to interest @ 9% on the amount of Rs. 11,61,671/- (work order no. 232) from -8- 01.10.2021 till realization as bill was passed on 31.12.2020.
f) Plaintiff shall also be entitled to interest @ 9% on the amount of Rs. 4,29,617/- (work order no. 125) from 30.11.2022 till realization as bill was passed on 30.05.2022.
g) Plaintiff shall also be entitled to interest @ 9% on the amount of Rs. 4,10,974/- (work order no. 127) from 01.12.2022 till realization as bill was passed on 31.05.2022.
h) Plaintiff shall also be entitled to interest @ 9% on the amount of Rs. 4,27,254/- (work order no. 126) from 06.12.2022 till realization as bill was passed on 06.06.2022.
19. Plaintiff shall be entitled to interest @ 6% on the security amount and earnest money amount of Rs. 4,18,060/- from the date of the suit till realization.
20. Plaintiff shall also be entitled to the cost of the suit.
21. Plaintiff is directed to pay deficient court fee, if any, on the pendente lite interest amount awarded.
22. Copy of the judgment be sent to both the parties by electronic mode, if available or otherwise.
23. Decree sheet be prepared after the plaintiff pays the requisite court fee.
24. File be consigned to Record Room. Digitally signed AMIT by AMIT KUMAR Date:
KUMAR 2024.08.09 15:02:52 +0530 (AMIT KUMAR) District Judge, Comm. Court-08 Central, Tis Hazari Courts Extension Block, Delhi/09.08.2024 -9-