Delhi District Court
M/S H.P. Gupta vs Delhi Development Authority on 14 January, 2009
IN THE COURT OF Dr. KAMINI LAU
ADDL. DISTRICT JUDGE : DELHI
Suit No. 35/2004
M/s H.P. Gupta,
(Regd. Partnership Firm),
Engineers & Contractors,
A1/102, Safderjung Enclave,
New Delhi 110029
.... Plaintiff
Versus
Delhi Development Authority,
Vikas Sadan, INA Office Complex,
New Delhi.
Through its Vice Chairman
.... Defendant
Date of Institution: 10.3.2004
Arguments heard on: 12.12.2008
Date of decision: 14.1.2009
: J U D G M E N T :
This suit for recovery of Rs.19,80,612/ has been filed by the plaintiff M/s. H.P. Gupta against the defendant DDA. Briefly the facts relevant to the disposal of the same are as under:
: 1 : BRIEF FACTS:
Plaintiff's Case:
The plaintiff is stated to be a registered Partnership Firm consisting of three partners namely Sh. H.P. Gupta, Sh. Raj Gupta and Sh. Lenin Gupta which partnership firm deals in execution of Government and other authorities' contracts for execution of civil works. The plaintiff is also a contractor with the DDA, competent to tender in the DDA and execute the contracts with the Department for the work of Civil Engineering Contracts.
The case of the plaintiff is that in response to the notice inviting Tender by the defendant for the work of construction 744 SFS Houses in Sector 7 & 8 at Jasola, Sub Head: Construction of 51 category 2 and 44 category 3 SFS houses at Jasola including water supply, sanitary installations and scooter garages including pile work in Sector VII GroupI, the plaintiff submitted their offer which was accepted on behalf of the respondent no.1 vide letter of intent dated 23.6.1993. Thereafter, a formal agreement dated 02.7.1993 was executed between the parties and the : 2 : date of start as per agreement was to be reckoned from the date of handing over of the site and the respondents made available the site vide site order book dated 7.8.1993 as per agreement, which was evident from the completion certificate of the respondents. According to the plaintiff, in terms of the agreement the work was to be completed within 19 months ie. by 6.3.1995 but the work could be actually completed on 19.12.1997 due to various lapses, defaults and breaches committed by the defendant and therefore, there was a delay in the execution of the work and the contract prolonged for a period of 2 years, 10 months and 15 days against the contractual period of stipulated completion of 19 months. According to the plaintiff, the defendants were obligated to provide requisite site, designs, detailed drawings being structural and architectural including alignment of sanitary and water supply arrangement besides requisite decisions and supply of requisite cement, steel and pipes at the stipulated rate; that the said work was to be executed under the instructions, drawings of the Executive : 3 : Engineer SEDIV, DDA in terms of the agreement. It is stated that the plaintiff made all preliminary arrangement for completion of the work by constructing godown being site store, site office and labour huts, water tanks and arrangement of requisite material for completion of the work within the target period but the DDA failed to discharge their obligations and caused unusual delay in approving the piling agency as the same was approved on 18.11.93 causing initial delay of 5 months; delay in decision as to whether conventional or compaction piling to be taken at site and the same could be decided as late as 7.5.93; delay for supply of material and also alignment for water supply and sanitary installations, and delay in execution of the electrical work resulting in delay in civil work.
It is further stated that the plaintiff was exposed to uncontemplated and unproductive expenditure on account of tools and plants, machinery, shuttering etc. besides regular establishment and casual labour and the defendant was notified about these delays vide letter dated : 4 : 5.10.93 where the plaintiff notified that a loss of Rs.10,000/ per month is being suffered because of defendant's delay, followed by another letter dated 23.11.1993, wherein it was confirmed that foolproof arrangements had been made by the plaintiff immediately on letter of intent. The plaintiff had again reiterated the said facts in letter dated 3.5.94 wherein Rs.20,000/ per month were claimed being losses suffered on account of lapses and defaults on part of the defendants and again vide their letter dated 12.9.94 in which it was highlighted that the plaintiff had claimed the expenditure incurred on site staff being technical and non technical and other miscellaneous machinery idle and claimed the losses suffered. It is further alleged by the plaintiff that there was delay in availability of the site as certain land could not be acquired from the villagers and as such the work was stopped of Block No. 4 on 22.10.95 which could be cleared only on 30.11.96.
It is further pleaded that in addition to above, the DDA had failed to make available water connection as per : 5 : agreement and hence, the plaintiff was forced to arrange water as the defendants failed to discharge their obligations as well. According to the plaintiff, the work was completed on 19.12.1997, but the DDA did not take possession of the said flats under the plea that the plaintiff should maintain watch and ward till the allottees take over the possession of the flats which fact is evident from the fact that even till date 5 flats are unallotted for which the DDA had withheld a sum of Rs.22,000/ ie. Rs.16,000/ for 4 flats @ Rs.4,000/ per flat for category II and Rs.6,000/ per flat for Category III lumpsum. The said sum of Rs.22,000/ has not yet been released by the DDA till date though, a period of six years have elapsed when the work was completed and the same could be released only after when the allottees take possession of the said flats. Further, it is alleged that Rs.10,000/ was withheld because of nonclearance of Quality Control Observations. It is stated that the defendants had prepared the extension of time because of 35 months delay in which the defendants had recorded delay on : 6 : various counts and all the said delays are attributed to the defendants and had further held that since the delay is on the part of the DDA the extension of time has been granted under clause 2 of the agreement till completion dated 19.12.1997. According to the plaintiff as per clause 2 of the agreement if there is a delay on the part of the plaintiff in the execution and completion of the work the defendants would penalize the plaintiff to the extent of 10% of the estimated cost of the work but in the present case the defendant had confirmed that the total delay in the execution is because of the defendant' s breach by granting extension of time without levy of compensation. It is alleged that despite the completion of work and insistence of the plaintiff, the defendants had not paid the dues and damages to the claimants i.e. Rs.22,000/ being the balance payment which is held up by the defendants for nonallotment of flats to the allottees from the final bill; Rs.10,000/ withheld because of nonclearance of Quality Control Observations from the running bill; Rs.1,48,506/ which has been wrongfully and : 7 : unjustifiably paid short in compaction pile; Rs.48,946/ paid short in providing glass panes to windows and doors on account of short payment as the size of glazing was more than 0.2 sqm; Rs.81,160/ paid short under clause 10cc of the agreement; Rs.6,25,000/ is payable for maintaining technical/ nontechnical regular establishment which was actually incurred due to delay caused by DDA as damages on establishment during prolongation beyond stipulated completion for a period of 34 months; Rs.4,35,000/ for maintaining watch and ward from the date of actual completion till 19.12.2003 as per notice; and Rs.6,10,000/ loss due to breach of the defendant.
It is further contended that the defendants had paid Rs.2,88,856/ under the alleged final bill on 30.12.2000 and thereafter under the said agreement defendants further lastly paid Rs.59,852/ on or about 25.11.2002. It is also stated that Rs.20,000/ against the above work is still held up and expected to be released shortly on account of 5 houses of Category II and III as already explained besides : 8 : Rs.10,000/ withheld for the absence of Quality Control Clearance. The plaintiff is stated to have made several communications for recovery of their dues and damages but to no result and ultimately the plaintiff served legal notice dated 11.12.2003 under Section 53(b) of Delhi Development Authority Act upon the defendant seeking the legitimate dues and damages with interest @ 24 % per annum within the statutory period of 2 months but the defendant has not released the legitimate dues to the plaintiff for which reason he has now approached this court praying for a decree of Rs.19,80612/ with interest @ 24 % per annum on the said amount till realization and cost.
Defendant's Case:
The defendants have filed their written statement wherein a preliminary objection has been raised that the plaintiff has not come to the court with clean hands and its conduct is such which disentitles it from any relief from this Court since the plaintiff has been properly paid for the work executed by it. It is further stated that there is no : 9 : cause of action for filing of the present suit as the plaintiff has received all the payments which were due to it from the defendant against the work executed by it and the plaintiff received the amount of final bill from the defendant without any protest and was adequately compensated for the little delay, which occurred in the execution of the work due to which reason the suit is liable to be dismissed. It is further stated that the plaint does not fulfill the necessary legal requirements as it does not contain any para relating to the court fee and the plaint is, therefore, liable to be rejected. According to the defendants, the suit is liable to be dismissed for want of the service of a legal, valid and proper notice and it is submitted that the plaintiff served a notice under section 53B of the D.D. Act, 1957, which was deficient in legal requirements, however, the department sent a reply to the said notice the receipt of which has been avoided deliberately.
On merits the defendants have denied all the allegations made against them and it is stated that the work : 10 : was to be completed within 19 months i.e. by 6.3.98 but could be completed actually on 19.12.98. It has been denied that various lapses, defaults and breaches were committed by the defendant and it is stated that the plaintiff has already been compensated adequately for the delay which aspect was duly taken into consideration when the extension of time for the execution of the agreement was considered and decided which extension of time was granted without levy of any compensation. According to the defendant, the delay was only to the extent which was necessitated by the circumstances and can not be considered as unprecedented and the same has been duly compensated. It has been denied that the stipulated material were not supplied to the plaintiff as per the requirements of the work except only once for a small period of 20 days from 30.3.97 to 18.4.97 for which the benefit has been duly given to the plaintiff while sanctioning the EOT. It is also stated that the alignment for water supply and sanitary installation was also duly compensated at the time of granting the extension of : 11 : time.
It is pointed out by the defendants that the provisions relating to machinery, tools and skilled and unskilled labour are contained in the specific items laid in the schedule of quantity i.e. labour, materials and tools and plants etc. are included in the analysis of rates and the plaintiff already stands compensated by a huge amount of Rs. 51.10 lacs under clause 10 (cc) due to which the plaintiff is not entitled to any other amount or compensation in any manner and on any other account. In so far as the escalation in the cost of materials and labour is concerned, the same is dealt with under clause 10cc of the Agreement & the escalation has to be worked only on the basis as provided in the said clause based on the National Index for cost escalation. It is pleaded that the plaintiff has been paid all due compensation on this account through different running account bills paid for escalation under clause 10cc from time to time. The defendants have contended that the deployment of technical and non technical staff are : 12 : mandatory arrangements which were required to be made by the Agency at its own cost as per the conditions laid down in the Agreement as no work could be executed without the provision of labour force etc. and therefore, nothing additional is payable to the plaintiff on any account whatso ever. It is also pleaded that the plaintiff had to provide the necessary fittings and fixtures and final coat of painting at the time of handing over of the flats which obligation was required to be fulfilled by the plaintiff as it had to complete these requirements in accordance with the conditions of the agreement. According to the defendants, the plaintiff was not asked by the defendant to continue with any watch and ward of the flats. It is stated that the allegations made by the plaintiff are malafide and meant to obtain an undue gain at the cost of the defendant and the public exchequer. The defendants have admitted having withheld a sum of Rs22,000/ as the plaintiff was supposed to provide the fittings and fixtures and the final coat which is still to be done and also having withheld the amount on account of the : 13 : clearance of Quality Control paras. The defendants have denied the various claims raised by the plaintiff and it has been denied that the plaintiff is entitled to the recovery of said amount.
ISSUES FRAMED:
On the basis of the pleadings of the parties, the Ld. Predecessor of this court has framed the following issues:
1. Whether the plaintiff has received the amount of final bill without any protest and has been adequately compensated for the little delay as alleged in para 2 of the preliminary objections of W.S., if so, its effect?
2. Whether the plaintiff has served legal notice under Section 53 B of the DD Act 1957, if so, its effect?
3. Whether the plaintiff is entitled to the amount as detailed in para 25 of the plaint?
4. Relief.
: 14 : EVIDENCE:
The partner of the plaintiff firm namely Raj Gupta has examined himself as his sole witness as PW1. He has in his examination in chief by way of affidavit corroborated what has been earlier stated in the main petition.
In rebuttal the defendants have examined their Executive Engineer, SED4 A.K. Kashyap as DW1 as their sole witness. He has in his examination in chief by way of affidavit corroborated what has been stated in the written statement. He has placed on record the agreement which is Ex.DW1/1; Extension of time running into 21 pages which is Ex.DW1/2; running bills running into 6 pages which is Ex.DW1/3; Statement of material which is Ex.DW1/4; running account bill which is Ex.DW1/5; final bill which is Ex.DW1/6 and reply to the legal notice which is Ex.DW1/7. FINDINGS:
I have heard the arguments advanced before me by the counsels for both the parties and have gone through : 15 : the records of the case. My findings on the various issues are as under:
Issue no. 1 Whether the plaintiff has received the amount of final bill without any protest and has been adequately compensated for the little delay as alleged in para 2 of the preliminary objections of WS, if so, its effect?
Issue no. 3 Whether the plaintiff is entitled to the amount as detailed in para 25 of the plaint?
Both the issues are clubbed together for the sake of convenience involving common discussion. The case of the defendant is that the plaintiff had received the payment of final bill without any protest wherein he has also been compensated for the delay which occurred in the execution of work and therefore the plaintiff is estopped from making any claim before this court and the suit is liable to be dismissed as having been brought up without any cause of action. The plaintiff on the other hand has made as many as 8 claims as mentioned in para 25 of the plaintiff for a total sum of Rs.19,80,612/ alongwith interest @ 24% per annum : 16 : on the decreetal amount till the realization of the amount alongwith the costs. In support of its case the plaintiff has examined its partner Raj Gupta as its sole witness as PW1 who has in his examination in chief corroborated what has been stated in the plaint in toto. Similarly the defendants have examined their Executive Engineer A.K. Kashyap as their sole witness as DW1 who has placed before this court the agreement entered between the plaintiff and the defendant which is Ex.DW1/1, the extension of time granted to the plaintiff running into 21 pages which is Ex.DW1/2, bills running into 6 pages which is Ex.DW1/3; statements of material which is Ex.DW1/4; running account bill which is Ex.DW1/5; final bill which is Ex.DW1/6 and reply to the notice which is Ex.DW1/7.
The first legal objection raised by the Ld. Counsel for the defendant is that the suit filed by the plaintiff is beyond the period of limitation. It is vehemently argued that the suit being related to a contract it falls within Article 18 under para 2 of the Schedule attached to the : 17 : Limitation Act and for the purposes of payment under this head the cause of action for the said purpose has to be taken as the date when the work was done but the limitation period provided under the Limitation Act is not attracted under the provisions of DD Act. It is argued that for the purposes of start of limitation the suit would be covered within the provisions of Limitation Act but the present case being under the Delhi Development Act the period of expiry of limitation has to be taken as stated under Section 53B of the DD Act which is 6 months from the date of cause of action. It is further argued that the cause of action would arise to the plaintiff when the work was done and accordingly the present suit filed in February/ March 2004 is clearly time barred by limitation under Section 53 B(2) of DD Act 1957. In so far as the aforesaid argument of the Ld. Counsel is concerned the judgment of the Delhi High Court in the case of M/s. R.S. Amar Nath Mehra & Co. Vs. Union of India in Suit No. 1378/84 decided on 7.4.1986 (unreported) and also in the case of Union of India Vs. M/s. R.S. Nath : 18 : Mehra in FAO (OS) No. 157/86 decided on 7.1.2002 passed by Hon'bl e Mr. Justice Devinder Gupta and Mr. Justice Vikramajit Sen are very clear and it has been specifically held that the period of limitation in such cases would be three years from the last payment. In the present case the last payment has been made on 25.11.2002 whereas the present suit has been filed on 26.2.2002. The defendant in their written statement had admitted that Rs.22,000/ was withheld on account of final coat, fitting and fixtures and Rs.10,000/ on account of quality control observations meaning thereby that the same is still due upon the defendant and therefore, under these circumstances the suit of the plaintiff is held to be within the period of limitation more so as the relief sought for by the plaintiff is for recovering the legitimate dues for which the limitation provided is three years and Article 1 of the Limitation act would be applicable since there is a current, running and mutual accounts maintained between the parties and the defendants have been prepared running account bills. The : 19 : last payment having been made on 25.11.2002, the limitation would have expired on 24.11.2005 and the present suit having been filed on 26.2.2004 is well within the period of three years.
Secondly the Ld. Counsel appearing on behalf of the defendant has argued that the plaintiff is estopped from claiming any amount in as much as he has accepted the payment of running bills as well as the final bills without any objection or protest. I have considered the submissions made by the counsel for the defendant and also the provisions of Section 16 and Section 28 of the Indian Contract Act which forms a part of the agreement. It is evident from the various letters of the plaintiff which have been placed on record that he has been repeatedly asking the defendant to pay the damages on account of delay and it is evident from the record that the plaintiff had been making the various communications to the defendant informing them about the delay which occurred on their account. It is also evident that the defendant had granted the extension of : 20 : time without any levy of compensation. The Delhi High Court in the case of M/s. Paragon Construction (India) Pvt. Ltd. Vs. Union of India & Anr. in OMP No.385/2007 and in the case of Kamal Construction Co. vs. DDA in FAO (OS) 47/2006 decided on 30.11.2007 and also in the case of Naraindas R. Israni vs. DDA in IA No. 1575/1995 in CS (OS) 2590/1994 (unreported) decided on 19.10.2005 upheld the claim of contractor under similar circumstances. Therefore, under these circumstances, I do not find any substantiate any merit in the arguments raised by the Ld. Counsel for the defendant.
Now coming to the various claims raised by the plaintiff. My findings on the various claims are as under:
Claim No. 1 & 2:
Both the claims are clubbed together for the sake of convenience involving common discussion. The plaintiff is claiming a sum of Rs.22,000/ as the payment being held up for non taking possession of the five flats out of 96 flats where the other allottes have taken possession and have : 21 : occupied the same. It is stated that this amount had been withheld on 19.12.1997 and despite 7 years having lapsed they are refusing to release the same and have no right to withhold the same. The plaintiff is also claiming a sum of Rs.10,000/ withheld as lumpsum when the work has been completed on 19.12.1997. Ld. Counsel appearing on behalf of the plaintiff has argued that the aforesaid amounts have been withheld on account of the alleged quality control para. I have gone through the testimonies of both the witnesses of the plaintiff and the testimony of DW1. It is evident from the crossexamination of DW1 that they have admitted withholding Rs.22,000/ and Rs.10,000/ for non fixing of fitting and fixtures to the dwelling units and nonclearance of QC observation of alleged defects.
The case of the plaintiff is that the fixtures and fitting have been provided by the plaintiff to the dwelling units and there has been no allegations of any defect at any point of time in the work executed. The perusal of the testimony of DW1 shows that he has admitted that the : 22 : defendant has not incurred any expenditure for the alleged non fixing of fittings and fixtures and QC para and has admitted that the work was completed on 19.12.1997 and the allottes are residing in the flats and no complaint regarding non fixing of fixtures in their flats have been received nor the defendants have communicate any explanation on that account. He has also admitted that despite the period of 10 years having lapsed no complaint regarding any defect have been received by them till date. Therefore, in view of the aforesaid and also in view of the settled law as laid down by the Delhi High Court in the case of P.C. Sharma & Co. Vs. DDA reported in 1998 (Suppl.) Arb. LR 300, I hereby hold that the amount of Rs.22,000/ and Rs.10,000/ have been arbitrarily withheld by the defendant which the plaintiff is entitled to the recover from the defendant.
Claim no. 3:
Plaintiff is also seeking a claim for a sum of Rs.1,48,506/ which according to him has been wrongfully : 23 : and unjustifiably paid short in the item of compaction pile. It is alleged that the work has been completed under the supervision, directions and instructions and in the presence of Executive Engineer but long after the completion of the work the Chief Engineer reduced the rates as Rs.1,48,506/. It has been vehemently argued by the Ld. Counsel appearing on behalf of plaintiff that the determination made by the plaintiff is required to be accepted in view of Clause 12 of the Agreement since the tender has been accepted by the Executive Engineer on 23.6.1993 and therefore the reduction by the Superintending Engineer is only an administrative formality. He has in this regard placed his reliance on the crossexamination of Executive Engineer wherein DW1 has admitted as correct that as per the agreement conventional piles were to be provided but it was substituted to compaction piles under Clause 12 of the agreement and states that it was done by the competent authority for which the payment has been made to the agency accordingly.
: 24 : I have gone through the testimony of DW1 wherein the witness of the defendant has denied the suggestion made by the counsel for the plaintiff that under Clause 12 it is the Executive engineer who has the power to substitute. He has specifically stated that there are 3 competent authorities namely Executive Engineer, Superintending Engineer and Chief Engineer depending upon the amount/ rate of item involved and in the present case the power to substitute with regard to piles with the Chief Engineer. He has, however, admitted that the substitution was done under Clause 12 and according to him the competent authority as provided under Clause 12 is that authority who has accepted the tender. Ld. Counsel for the plaintiff has also placed his reliance in the case of M/s. Parmar Construction Company Vs. DDA reported in 1996 RLR (2) 73. I am unable to accept the argument advanced by the Ld. Counsel appearing on behalf of the plaintiff to say that since the work was accepted by the Executive Engineer on 23.6.1993 and the agreement was also signed : 25 : by the Executive Engineer no other authority would have any active role and the reduction by the Superintending Engineer is only a formality would not be correct. Any authority senior of the Executive Engineer while according sanction is required to apply its mind to the decision taken by the Executive Engineer and the sanction could not be granted mechanically without application of mind. Admittedly compaction pile was a substitute work and the amount of Rs.27,34,553/ had been determined by the Executive Engineer yet the Superintending Engineer and the Chief Engineer had reduced the same to Rs.25,89,796/. The judgment of the Delhi High Court in the case of Parmar Construction Company does not assist the plaintiff in any manner since the facts of the said case were different wherein the dispute was with regard to the withholding of the amount for want of sanction of the engineer Incharge. The plaintiff has not placed on record any material to show that firstly the Engineer Incharge was the Executive Engineer and secondly that the dispute in the : 26 : present case is with regard to the reduction of the amount by the Chief engineer who according to the defendant is the Engineer Incharge on the basis of the power of financial sanction given to him. Therefore, under these circumstances, I hereby hold that the plaintiff has not been able to prove his entitlement to the claim of Rs.1,48,506/ which is hereby declined.
Claim No. 4:
The plaintiff is further claiming a sum of Rs.48,946/ paid short in the item of fixing of glass panes to windows and ventilators. According to the affidavit of the evidence of the plaintiff the details of this claim are mentioned on page 26 of the plaint. I have gone through page 26 of the plaint which is a communication made by the Executive Engineer dated 18.11.1993 to the plaintiff informing the plaintiff that M/s. Pile Foundation Construction Co. has been approved for executing the pile work on their behalf. The said document does not assist the plaintiff in any manner. It is argued by the plaintiff that as : 27 : per the agreement the thickness of the glass panes adopted 3 mm as established from the applicable detailed analysis of rates whereas the defendant had directed them to provide glass panes as contemplated in the specification which specification contemplated 4 mm and 5.5. mm as per size of the windows and ventilators. It is further argued that there is a conflict in the Delhi Analysis of Rates and in the Specifications which tentamount to ambiguity and hence the plaintiff is entitled for the said claim. He has stated that the specifications have been appended as page no. 26A, 26B and 26C. I have gone through the said specifications but the same has not been proved by the plaintiff in accordance with law nor any question has been put to the witness of the defendant in respect of the same. Therefore, I hereby hold that the plaintiff is not entitled to the claim of Rs.48.946/. Claim no.5:
The plaintiff is also seeking the payment of escalation under Clause 10 cc which works out to be Rs.81,160/ on the amount of Rs.1,48,506/ but according to : 28 : him he has restricted the same to Rs.61,040/. In his examination in chief by way of affidavit the plaintiff has stated that the details of the said claim is available in page 27 of the plaint. According to him, the rate short paid in claim no. 3 to the extent of Rs.1,48,506.26p paid short in pile foundation and claim no. 4 glass panes being the difference of thickness to the extent of Rs.48,946.68p, the total comes to Rs.1,97,452.94p and Clause 10 cc cost indices as determined by the DDA have not been paid.
According to him, for both these short payments he had taken coefficient adopted by the DDA in this contract which are not in dispute between the parties and therefore, on the basis of coefficient the amount comes to Rs.81,160/ as outlined in page 27 of the plaint.
I have gone through page 27 of the plaint which is indent of the plaintiff dated 23.5.1994 made to the Executive Engineer wherein the plaintiff had made a reference to the earlier communications alleging that they had been put to financial loss. The said communication has : 29 : not been specifically put to the defendant depriving them of an opportunity to rebut the same. Further it is evident from the crossexamination of PW1 that he has admitted that he was paid a sum of Rs.51.10 lacs towards rise in prices as per clause 10 cc of the contract for which purpose the extension of time was granted. He has denied that he had not arranged for machinery, engineers or the labourer at the site on award of the contract to him and has also denied that it was one of the terms of the contract that he shall not claim any loss or damages from the DDA. The plaintiff has, however, failed to prove on record the specific evident to show his entitlement to the payment of escalation under Clause 10 cc of the contract on the amount of Rs.1,85,406/ which he is restricting to Rs.61,040/. Under these circumstances, I hereby hold that the plaintiff is not entitled to the said claim. Claim No. 6 & 8:
Both the said claims are clubbed together for the sake of convenience involving common discussion. The plaintiff is claiming Rs.6,25,000/ for maintaining technical : 30 : and nontechnical staff during prolongation as the stipulated completion as per the agreement was 6.3.1995 but the work prolonged till 19.12.1997 for a further period of 2 years and 10 months and also a sum of Rs.6,58,275/ for maintaining tools and plants and machinery during prolongation from the stipulated completion i.e. 6.3.1995 till actual completion i.e. 19.12.1997 for the prolongation period of 2 years and 10 months. It is argued by the Ld. Counsel appearing on behalf of the plaintiff that during this period of prolongation the plaintiff had maintained Engineer and other establishment and had also been maintaining certain, tools, plants and machineries/ articles were to be deployed for a further period of 34 months. It is pointed out that as per Clause 36 of the agreement the plaintiff had to maintain Engineer otherwise he was likely to be penalized and on account of prolongation of work committed by the defendant the extension of time was granted and therefore, the plaintiff is entitled to the recovery of losses suffered by him for the aforesaid period. Ld. Counsel for the plaintiff has in this : 31 : regard placed on record the details of the establishment which he has appended from page 28 (1) to 28 (259) and it is argued that this is the actual expenditure incurred on establishment during prolongation being beyond the stipulated period of completion and the documents/ vouchers of payments have also been placed on record.
According to the plaintiff, he had also contemplated 15% profit on the work being 10% profit plus 5% expenditure on overheads as per value of the contract (as per settled norms in Building & Engineering Contracts) and had this work been completed within the stipulated period of 19 months he would have made expenditure of 5% on the overheads and establishment which comes to Rs.11,35,000/ (Value of contract) i.e. Rs.2,27,000/ x 5% = Rs.11,35,000/ whereas for further 34 months Rs.11,35,000 x 34/19 = Rs.9,31,000/ but because of delay of further 34 months in addition to the contract period he had to incur infructuous expenditure, therefore, the amount now claimed is very mitigated amount as compared with the expected expenditure. Ld. Counsel : 32 : appearing on behalf of the plaintiff has also placed his reliance on the authority of Delhi High Court in the case of Jagat Ram Tehran Vs. Delhi Development Authority reported in 2003 (2) Arb. L.R. 110 (Delhi).
I have gone through the various documents placed on record by the plaintiff which are the extracts of Hindrance Register placed on record by the defendant and the various communications made to the defendant by the plaintiff particularly the communications dated 5.10.1993, 18.11.1993, 3.5.1994, 12.9.1994, 3.2.1995, 21.3.1995, 25.10.1995, 25.2.1996, 7.6.1996, 17.6.1996, 24.9.1996, 25.9.1996, 25.10.1996, 26.2.1997 and 7.3.1997.
It is evident from the letter dated 5.10.1993 which is Annexure P5 by way of which the plaintiff is claiming Rs.10,000/ per month on account of non approval of pile agency and there being no water arrangement. It is also evident from the letter dated 18.11.1993 which is Annexure P6 to the plaint that the defendant had approved the piling agency though the date of commencement was : 33 : 7.8.1993, there was an initial delay of 3.5 months as the said letter of the defendant informing the plaintiff about the approval of the piling agency. Further vide letter dated 3.5.1994 which is Annexure P7 to the plaint, the plaintiff has informed the defendants regarding non availability of designs and decisions due to which reason they were suffering a loss of Rs.20,000/ per month. It is also evident that vide letter dated 12.9.1994 which is Annexure P8, that the plaintiff has incurred expenditure on establishment for which he is claiming Rs.4,43,070/. Also, vide letter dated 3.2.1995 which is annexure P9 to the plaint, the plaintiff has specifically informed the defendant that there is no drawing available to commence the work due to which reason he was incurring loss on account of establishment tools and plant and machinery being idle which agreement was expiring on 6.3.1995 for which the plaintiff also requested for finalization of the contract as he was under
frustration of incurring heavy expenditure without work. He has also specified in the said letter that the department shall : 34 : be liable to pay damages including overheads, tools and plants and machinery and establishment till actual completion of the work.
Vide letter dated 21.3.1995 which is Annexure P10 to the plaint the plaintiff apprised the defendant the drawings being defective and requested them to correct the deficiency as a result of which no would commenced. Again vide letter dated 27.10.1997 which is Annexure P11 he has informed the defendants that due to non finalization of the height of the roof no work could be commenced. Further vide communication dated 25.2.1996 the plaintiff informed the defendant that the work of Block no. 4 was under stay and the indent issued by the DDA for supply of stipulated material was returned by the DDA store because of non availability of the material in their store which was the obligation of the department. The plaintiff has specifically pointed out that the work was held up due to the nonavailability of the drawing of sanitary and water supply including short supply of cement and noncommencement of : 35 : the electrical work as a result of which the civil work was held up. He further informed the defendant that the decision was awaited for flooring and glazed tiles.
I have also gone through the communications of the plaintiff dated 17.6.1996 which is Annexure P15, communication dated 17.6.1996 (Annexure P16), communication dated 24.9.1996 (Annexure P17), communication dated 25.10.1996 (Annexure P18), communication dated 25.10.1996 (Annexure P19), communication dated 26.2.1997 (Annexure P20) and the letter dated 7.3.1997 (Annexure P21) which show that the plaintiff has been repeatedly writing to the defendant informing them about the non finalization of the internal layout of GI and SCI pipes as a result of which the work was held up. He has also stated that the decision of the staircase is pending resulting in the work being idle. The plaintiff has further informed the defendant that the electrical agency was not doing the work as a result of which the civil work was held up resulting in idle technical and non technical crew for : 36 : which he was suffering a loss of Rs.5,000/ per day and the work was held up due to nonfixing of electric pipes. The plaintiff also informed the defendant that the work in Block No. 4 was held up and the work of RCC precast jail held up due to non approval of drawing and the work of plinth protection was held up due to non availability of development plan and other miscellaneous work.
I have duly perused the hindrance register maintained by the defendant which is Ex.P1 which shows that the entire delay of 34 months and 15 days has been attributed to the defendant and there was no delay on behalf of the plaintiff. The various communications of the plaintiff as discussed herein in above finds a corroboration from the hindrance register maintained by the defendant which is Ex.P1 which bear the signatures of JE, AE and also the plaintiff contractor. I have gone through the cross examination of DW1 wherein the witness of the defendant has admitted that if the work is delayed for a single day then the contractor is liable for compensation under Clause 2 of : 37 : the agreement. He has admitted that the work was prolonged by 34 months beyond the stipulated period i.e. 19 months but according to him the extension of time was granted by the competent authority without levy of compensation. He has also stated that the DDA has already paid Rs.51.10 lacs on account of Clause 10 C(C) of the agreement. It is also evident from the various vouchers placed on record that the said vouchers are in respect of the employment of the additional labour at the site but no voucher or document has been placed on record to show that he had arranged for additional machinery, tools and equipments for the said purpose. Simply making communications to the defendant that he has been incurring loss on account of the delay is not sufficient. It is necessary for the plaintiff to clarify and prove the said losses more so as the contractor has already been duly compensated by the defendant and has also received a sum of Rs.51.10 lacs. The plaintiff who is a registered partnership firm duly registered with the Registrar of Firms as required under Section 69 of : 38 : Partnership Act, was required to place before this court the duly audited accounts of the firm and certified by a Charted Accountant which they have failed to do. Simply placing on record the vouchers of the cash paid to the various workers will not help and assist the plaintiff in any manner. Already having received Rs.51.10 lacs in accordance with clause 10 C (C) it was necessary for the plaintiff to place specifically proved the losses incurred by him in maintaining technical and non technical staff and also the tools, plants and machineries during the period of prolongation of 34 months which he has not been able to do. Therefore, I hereby hold that the plaintiff is not entitled to the claims of Rs.6,25,000/ and Rs.6,58,275/ as claimed.
Claim No. 7
The plaintiff is claiming a sum of Rs.4,35,000/ on account of watch and ward expenditure incurred after actual completion dated 19.12.1997 in addition to 6 months maintenance period as per Clause 14 and 17 of the Agreement i.e. w.e.f. 19.6.1998 to 19.12.2003 i.e. 66 : 39 : months. Ld. Counsel appearing on behalf of the plaintiff has placed his reliance on the crossexamination of PW1 wherein he has specifically denied that he was not doing the watch and watch in respect of the flats built by him and according to him, the possession of which had not been taken over by the DDA. He has also placed on record the Circular no. 509 dated 2.5.1997 and also on the detailed break up regarding watch and ward for 66 months which comes to Rs.6,35,000/ @ Rs.6,600/ per month. He has also placed his reliance on the authority of Delhi High Court in the case of Mohan Construction Vs. DDA reported in 2005 (2) Arb. L.R. 486 (Delhi) wherein Hon' ble Mr. Justice Pradeep Nandrajog has upheld the award of watch and ward from the date of completion till the allottees took possession.
I have duly considered the material on record to which there is no effective rebuttal on behalf of the defendant. There is nothing on record to show that any complaint regarding theft of pilferage before the possession : 40 : was taken over by the DDA, had been reported. The plaintiff has specifically stated that he had deployed the watch and ward during the intervening period of 66 months till the possession of the flats were taken over by the DDA and therefore, I hereby hold that the plaintiff is entitled to the claim of Rs.4,35,000/ on account of watch and ward. Claim No. 9 & 10:
The plaintiff is also claiming an interest @ 12% per annum and cost of the suit. There is no specific provision for grant of interest in the agreement and therefore, it is open for this court to grant any reasonable amount of interest. Keeping in view the fact that the defendant is a statutory body involved in development and construction activities for the welfare of public, I hereby hold that the ends of justice would suffice if the plaintiff is awarded the interest @ 6% per annum from the date of institution of the suit till the realization of the decreetal amount.
Issues are disposed off accordingly.
: 41 : Issue no. 2 Whether the plaintiff has served notice under Section 53B of the DD Act, 1957, if so, its effect?
In their written statement the defendants have raised a preliminary objection that the notice under 53B of DD Act was deficient in legal requirements to which the department had also sent a reply which was deliberately avoided. I have gone through the testimonies of both the witnesses of the plaintiff and the defendant i.e. PW1 and DW1. It is evident from the record that the legal notice dated 11.12.2003 had been sent to the defendant receipt of which has not been denied by the defendant but according to them it is deficient in legal requirement. Ld. Counsel appearing on behalf of the defendant has vehemently argued that the notice does not fulfill the requirement of Section 53 B of DD Act nor it was served properly as it was addressed to the Vice Chairman and not the defendant. Further it is alleged that the notice does not provide the requisite calculations and cannot form the basis of the suit and the : 42 : amounts claimed in the present suit are different from those stated in the notice. It is further argued that the notice does not contain the proper date of cause of action for purposes of filing the present suit visavis the amount claimed and therefore, under these circumstances the suit of the plaintiff is required to be dismissed on this ground alone.
I have gone through the contents of notice dated 11.12.2003 under Section 53B of DD Act wherein the plaintiff has very specifically given the details of the disputes now raised by him in the present suit. It is an exhaustive notice running into 8 pages wherein the plaintiff has raised specific claims alongwith amount mentioned and their interest claimed on the same.
The object of giving a notice contemplated under Section 53B of DD Act is to give an opportunity to the authority to reconsider the legal position. The legislative intent behind Section 53B is that public money and time should not be wasted on unnecessary litigations and public officers should be given reasonable opportunity to examine : 43 : the claims made against them least they be drawn into unavoidable litigations.
In the present case an exhaustive notice running into as many as 8 pages has been given to the defendant to which they are stated to have filed their reply which according to the defendant had been evaded by the plaintiff. The reply to the said notice is Ex.DW1/7. In view of the aforesaid I hereby hold that the requirement of Section 53B of the DD Act has been duly complied with by the plaintiff. Issue is hereby decided in favour of the plaintiff and against the defendants.
Relief:
In view of my findings with regard to the various issues, I hereby hold that the plaintiff is entitled to the recovery of Rs.4,67,000/ from the defendant alongwith the interest @ 6% per annum from the date of institution of the suit till the realization of the decreetal amount.
: 44 : Suit of the plaintiff is hereby decreed. Parties to bear their own costs. Decree sheet be prepared accordingly. File be consigned to Record Room.
Announced in the open court (Dr. KAMINI LAU)
Dated: 14.1.2009 Addl. District Judge: Delhi
: 45 :
H.P. Gupta Vs. DDA
14.1.2009
Present: None for the plaintiff.
Sh. S.D. Sharma, counsel for the defendant. Vide my separate detailed order dictated and announced in the open court, but not yet typed, suit of the plaintiff is decreed. Parties to bear their own costs. Decree sheet be prepared accordingly. File be consigned to Record Room.
ADJ: DELHI 14.1.2009 : 46 :