Kerala High Court
Food Corporation Of India vs T.M. Abdul Saleem on 16 July, 2012
Bench: K.Hema, A.M.Shaffique
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MRS.JUSTICE K.HEMA
&
THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE
MONDAY, THE 16TH DAY OF JULY 2012/25TH ASHADHA 1934
AS.No. 623 of 1997 ( )
----------------------
OS.802/1993 OF I ADDITIONAL SUB COURT, KOZHIKODE.
.................
APPELLANT/DEFENDANT:
--------------------------------------
FOOD CORPORATION OF INDIA,
REPRESENTED BY THE SENIOR REGIONAL MANAGER,
REGIONAL OFFICE, TRIVANDRUM.
BY SMT.V.P.SEEMANDINI, SENIOR ADVOCATE.
ADV. SRI.V.B.HARI NARAYANAN.
RESPONDENT(S):
--------------------------
T.M. ABDUL SALEEM,
MOTHARAM ROAD, TOLL GATE,
EDAPPALLY P.O., COCHIN-24.
BY ADV. SRI.K.L.NARASIMHAN.
THIS APPEAL SUITS HAVING BEEN FINALLY HEARD
ON 06-03-2012, THE COURT ON 16-07-2012 DELIVERED
THE FOLLOWING:
rs.
K.HEMA & A.M.SHAFFIQUE, JJ.
* * * * * * * * * * * * *
A.S.No.623 of 1997
-------------------------------
Dated this the 16th day of July 2012
J U D G M E N T
SHAFFIQUE,J The defendant is the appellant. Parties are referred to as plaintiff and defendant.
2. The suit is filed for recovery of money on the allegation that in respect of a contract of loading and unloading, handling and transportation of food grains, the plaintiff was not paid the entire amount as per the bills furnished and hence he claimed the amounts which were not paid by the defendant.
3. It is an admitted fact that the plaintiff and defendant entered into a contract dated 13/07/1988 for loading, unloading, handling and transportation of food grains from the depot of the defendant to Sub Depot No.2 of the defendant situated at Calicut. The contract was for a period of two years effective from 11/1/1998.
4. According to the plaintiff, the actual distance involved in transportation of goods from West Hill Main Depot, Calicut to A.S.No.623 of 1997 2 Calicut sub depot No.2 is more than 5.6 Kms for which the applicable rate is at Rs.8.32/- per metric ton. Though he completed the work and was entitled for the rate at Rs.8.32/- per metric ton, the defendant did not pay the said amount. The non- payment according to the plaintiff, is a breach of contract as he was entitled to get payment on the basis of the actual distance covered. According to him the total quantity transported was 55490 metric tons and as per his claim he was entitled to a total amount of Rs.18,42,093.76/-. But only an amount of Rs.12,57,445.76/- is paid. Hence he is entitled for recovering Rs.5,84,648/- as the unpaid bill amounts.
5. The suit was later amended by limiting his claim to Rs.2,92,392.98/- on the ground that in another suit filed by another Contractor with reference to a similar contract, as O.S.No.363/1988 of the Munsiff Court, Kozhikode, the distance in dispute was fixed at 5 Kms. which the plaintiff accepts and he limited his claim to Rs.7/- per metric ton. Hence instead of claiming the rate at Rs.8.32/-, the plaintiff limited his claim to Rs.7/- per metric tone and necessary amendments were carried out.
A.S.No.623 of 1997 3
6. The defendant admitted that the plaintiff had completed the contract but disputed the actual distance of transportation and also contended that the suit was barred by limitation. According to the defendant the bills were submitted periodically and when each bill was submitted by the plaintiff the defendant paid only Rs.5.68/- per metric ton taking into consideration the distance as 4 Kms. Since there was refusal to pay the amounts right from 30/01/1989 till 29/10/1990 the date on which payments were effected, the suit filed on 09/11/1993 is barred by limitation.
7. The court below framed the issue regarding maintainability of the suit, whether the suit was barred by limitation, what was the actual distance of transportation, what was the quantity agreed to be transported and the entitlement of the plaintiff to get the transportation charges as claimed, the rate of interest, cost etc.
8. The plaintiff relied upon the oral evidence of PW1, the Advocate Commissioner in O.S.No.363/1988 of the Munsiff Court, Kozhikode and PW2, a representative of the plaintiff. The plaintiff also relied upon Exts.A1 to A12 documents. The defendants examined the Assistant Manager of Food Corporation A.S.No.623 of 1997 4 during the relevant time as DW1 and relied upon Ext.B1.
9. The court found that the suit was maintainable as the parties did not specifically point out any jurisdictional infirmity in filing the suit. The court also found that the suit was not barred by limitation applying Article 26 of the Limitation Act. In regard to the distance, the court below relied upon the reports of the Advocate Commissioner in O.S.No.363/1988 of the Munsiff Court, Kozhikode and the judgment in the said case and also the judgment of the High Court in A.S.No.243/1981 in respect of similar contracts in which the distance was found to be 5 Kms and had come to a conclusion that the distance can be taken as 5 Kms and since the payment was not effected the suit was decreed.
10. The defendant impugns the above judgment mainly on two grounds, i) That the suit is barred by limitation, ii) That the distance fixed by the court below is not correct which apparently are the points for determination in this appeal.
11. The first point for consideration is whether the suit is barred by limitation. The suit was filed on 09/11/1993. As per the averments in the plaint the cause of action for the suit had arisen on 10/11/1990, the date of expiry of the contract. The A.S.No.623 of 1997 5 averments in the plaint also discloses that the plaintiff relies upon the date of expiry of contract as the date on which the plaintiff could claim the difference in the amount.
12. The learned counsel for the appellant Smt.Karthika contended that Article 26 relied upon by the court below cannot have any bearing on the facts of the case and the relevant clause that applies would be Article 113, the residuary clause. According to the learned counsel, the right to sue accrued to the plaintiff on the dates when there was refusal by the defendant to pay the amount as claimed by the plaintiff by way of separate bills. The bills were issued by the plaintiff from 06/01/1989 onwards and the first payment was effected on 30/01/1989 which would show that there was refusal to pay the amount claimed on the said date. It is argued that in the bills submitted by the plaintiff, he had claimed an amount at Rs.8.32/- per metric ton + Rs.299/- which is the rate for the work and what is paid is only 5.68/- per metric tone + Rs.299/- taking into consideration the distance as 4 Kms. So, according to the learned counsel each time when there is a bill raised by the plaintiff for a higher amount and payment is made only for a lesser amount indicating the rate for transportation there is a claim and consequent A.S.No.623 of 1997 6 refusal and each refusal gives the plaintiff a right to sue and therefore the suit filed on 5/11/1993 which is after three years from even the last date of refusal that is 29/10/1990 is barred by limitation.
13. The learned counsel relies upon judgment of the privy council in Mt.Bolo v. Mt.Koklan [AIR 1930 Privy Council 1970] to support the argument, wherein it is held that "there can be no "right to sue" until there is an accrual of the right asserted in the suit and its infringement or at least a clear and unequivocal threat to infringe that right by the defendant against whom the suit is instituted."
14. The learned Counsel also relies upon the judgment in Delhi Cloth and General Mills Ltd. [AIR 1983 ALLAHABAD 381]. In the said judgment, the emphasis is on the judgment of the Supreme Court in Rukhmabai v. Lala Laxmi Narayan [1960 SC 335] in which it is stated that when there are successive invasions or denials of right, the right to sue under Article 120 accrues when the defendant had clearly and unequivocally threatened to infringe the right asserted by the plaintiff in the suit. Every threat by a party to such a right however ineffective or innocuous, cannot be considered to be A.S.No.623 of 1997 7 clear and unequivocal so as to compel him to file a suit. Whether a particular threat gives rise to compulsory cause of action depends upon the question whether that threat effectively invades or jeopardies the said right.
15. The counsel also brings to our notice the provisions in the contract Ext.A3 especially Article XVI relating payment. It reads as follows:
"(a) Payment will be made by the concerned District Manager of the Food Corporation of India on submission of the bills, in triplicate duly supported by consignee receipts/or work certificates issued by the Sr.Regional Manager or an officer acting on his behalf as the case may be."
b) The Contractor should submit all their bills not later than two months from the date of expiry of the contract, so that the refund of security deposit may be speeded up. In order to facilitate disposal of bills, the contractors are advised to submit their bills weekly/fortnightly."
16. It is argued that since the Contractor is given an option to submit their bills weekly or fortnightly, every time when the said bill is submitted and after scrutiny only a part A.S.No.623 of 1997 8 payment is effected there is unequivocal refusal to make payment of the balance amount.
17. On the other hand, the learned counsel appearing for the plaintiff Sri.Krishna Prasad submits that he agrees with the proposition that Article 113 alone applies to the facts and circumstances of the case and not Article 26 as stated by the court below. He further contends that the right to sue does not accrue when the entire amount covered by each bill is not paid. He is entitled for the payment only after the entire work is completed. The contract is for a period of two years and under normal circumstances his entitlement for payment arise only after the period of contract. However, there is an advice as seen from Clause XVI (b) of Ext.A3 that the Contractor can give payment of part bills as well, either weekly or fortnightly. This is only to enable the Contractor to complete the work so that he gets the payment in periodic intervals. Even if no such payment is effected, he has no option to discontinue the work. He is bound to carry out the work completely and can raise a dispute only after the entire work is completed. It is argued that his right to sue accrues only when the period of contract is over and there is no unequivocal threat or refusal to pay while effecting A.S.No.623 of 1997 9 payment of the part bills. He also relies upon the judgment in Ithappiri Varkey v. Govindan Nambuthiripad [1956 KLT 427] to indicate that to constitute refusal within the meaning of Article 113, there must be a definite demand and refusal. It is also pointed out that in the said judgment relating to previous Article 120, when the starting point of limitation under Article 120 is the accrual of the right to sue, such right to sue depend lastly upon the circumstances of the particular case which should mean the right to bring a particular suit on the defendant's denial of the plaintiff's right to collect jenmikaram at the excess rate claimed. There can be no right to sue until there is an accrual of the right asserted in the suit and its infringement or at least a clear and unequivocal threat to infringe that right by the defendant against whom the suit is instituted.
18. The question therefore to be considered is whether by not effecting payment of the entire amount covered by the bills there is an absolute unequivocal threat to the plaintiff that the defendant would not pay the balance amount. We find from Ext.B1(5) that when the Contractor issues a bill, the same is verified by the defendant and a correction is carried out in the bill in respect of the amount claimed. As against Rs.8.32/- per A.S.No.623 of 1997 10 metric ton the figure Rs.5.68/- per metric ton is incorporated and corresponding changes are made in the amount involved. The sanction to pay the amount on each occasion is also relevant which does not indicate the reason for refusal to pay the full amount whereas it only shows that a cheque for certain amount is paid with reference to certain bills as settlement of the claim. Of course the contractor might be aware of the reason for reduction in payment. The point is whether the right to sue accrues to the plaintiff in the case. We do not find any document by which any intimation is given to the plaintiff stating that Food Corporation of India will not consider the bill claiming an amount of Rs.8.32/- per metric ton whereas it can be seen that the bills are settled for an amount as fixed by Food Corporation of India. Therefore, necessarily when the contract is in force and continuing the question is whether the right to sue accrued to the plaintiff when there is non-payment of the entire amount by the defendant. We do not find an unequivocal threat to infringe the right of the plaintiff by the defendant in paying only part of the amount when amount in the bills are being processed and paid. In the case of a contract which is in force for a period of two years necessarily a party to contract can make a complaint A.S.No.623 of 1997 11 of breach by completing the contract as well. It is not necessary that the party who suffers the breach terminates the contract then and there. In the case of monetary disputes it is open for the party not in breach to complete the work and then claim the amount in dispute after the period of contract also. In the present case, the plaintiff though issued the bills did not take any further proceedings in the matter to make a claim until the contract had been completed. Once the contract had been completed, his right to sue accrued. In the above circumstances, we find that the suit is filed within a period of limitation though for different reasons other than what is stated by the court below.
19. We shall next consider the point regarding the distance and rate. In regard to distance factor Ext.A8 is the copy of the judgment in O.S.363/88 between one P.A.Ali and the defendant. That was a suit for declaration in which the plaintiff in the said case entered into a contract with the defendant for similar purposes for transportation from West Hill to Sub Depot No.2 at Calicut for two years from 27/10/1986 and the issue was relating to distance. After elaborate judgment in the above case, the Court had come to a conclusion that distance involved in the A.S.No.623 of 1997 12 transportation with reference to the said case was 5 Kms and that the plaintiff in that case was entitled to payment of transportation charges reckoning distance as 5 Kms. PW1 is the Advocate Commissioner in the said O.S.No.363/1988. She had taken measurements from the West Hill, Main Depot to Depot No.2 at Calicut and Exts.A1 and A2 are the report and plan filed by her. Exts.A1 and A2 would show that the distance is 4.685 Kms. As per the terms of contract, the said distance is to be reckoned as 5 Kms. Ext.A5 is the plaint in O.S.No.363/1988 and Ext.A6 is the written statement filed by the defendant in the said case. Ext.A7 is the decree in the said case and Ext.A8 is the judgment. Ext.A12 is the judgment in A.S.No.243/81 of the High Court of Kerala. That too was a case relating to distance from West Hill to Sub Depot No.2 wherein the High Court, having taken into consideration the evidence in the case, the distance is fixed at 5 Kms. Therefore considering the evidence adduced in O.S.No.363/1988 which is now part of the record in this case and considering the evidence of the Advocate Commissioner and her report and plan Exts.A1 and A2, it is clear that the distance can be taken as 5 Kms. Since the distance found by the Advocate Commissioner is 4.685 Kms, the rates are to be worked out on A.S.No.623 of 1997 13 the basis that the distance travelled is 5 Kms. In that view of the matter, the judgment of the trial court to that extent cannot be interfered with.
20. Having answered the aforesaid two points in favour of the plaintiff, we do not think that any interference is called for to the decree passed by the court below.
Hence the appeal is dismissed. No costs.
(sd/-) (K.HEMA, JUDGE) (sd/-) (A.M.SHAFFIQUE, JUDGE) jsr //True Copy// PA to Judge A.S.No.623 of 1997 14 K.HEMA & A.M.SHAFFIQUE, JJ.
A.S.NO.623/1997
JUDGMENT 16/07/2012 A.S.No.623 of 1997 15 K.M.JOSEPH & M.C.HARI RANI, JJ.
.No. of 200
ORDER/JUDGMENT 30/082010