R.S.A. No. 321 of 2009 (O&M) -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH R.S.A. No. 321 of 2009 (O&M) Date of decision: 19.1.2009 Municipal Council, Yamuna Nagar and others ....Appellants Versus Ramesh Chand ....Respondent CORAM: HON'BLE MR. JUSTICE VINOD K. SHARMA Present: Mr. Sanjay S. Chauhan, Advocate, for the appellants. ***** VINOD K. SHARMA, J (ORAL) This regular second appeal is directed against the judgment and decree dated 10.4.2007 and 4.12.2008 passed by the learned Courts below vide which the suit filed by the plaintiff/respondent for recovery of an amount stands decreed. The plaintiff brought a suit for recovery of a sum of Rs.1,20,000/- on the ground of supply of goods to the Municipal Committee against which payment was said to have not been made. In support of this contention, the plaintiff produced on record the bills as well as details of the goods supplied to the Municipal Committee as also the total amount received. The case of the plaintiff was that the total goods supplied were worth Rs.4,23,457.78 paise out of which a sum of Rs.3,07,651.48 paise had been received, thus leaving a balance of Rs.1,15,806.30 paise as on 31.3.1998. The suit was contested wherein a plea was taken that the R.S.A. No. 321 of 2009 (O&M) -2- stock as claimed was not supplied to the Municipal Committee as the same was not entered in the stock register of the appellant/defendant. The plea of the suit being time barred was also taken. The learned trial Court on appreciation of evidence held that the plaintiff was entitled to amount claimed along with interest @ 18% per annum. Issue No. 3 regarding suit being time barred was not pressed. In the appeal, however, a stand was taken that the plea of the limitation was question of law and, therefore, the Court was bound to decide the question of limitation also. The learned Additional District Judge, Yamuna Nagar, considered the evidence brought on record showing that the last payment was made on 3.4.1994, therefore, it was held that the suit having been filed within two years of said date was within the period of limitation. The plea of the appellant/defendant that the supplies were not made as per provisions of Section 50 of the Municipal Act has been rejected. Reasons given for rejecting this plea by the learned lower appellate Courts read as under: - “Mere this fact that the provisions of Section 50 of the Municipal Act have not been followed is no ground to non suit the plaintiff because the appellants/Municipal Council has received the electric goods from the plaintiff even though the contract for supply of the goods does not fulfil the requirement of Section 50 of the Municipal Act and is invalid on that account, but, as the goods have been voluntarily accepted by the appellants-Municipal Council, plainitff is entitled for the recovery of the value thereof as per Section 65 and 70 of the Indian Contract Act. To support this view reference can be made to case State of West Bengal Vs. M/s B.K. Mondal and Sons, A.I.R. 1962 S.C. 779. Then, there is a direct authority of our Hon'ble High Court titled as Deputy Chand Goyal Vs. Municipal Committee, Meham, 1993(2) R.R.R. 202. In that R.S.A. No. 321 of 2009 (O&M) -3- case plainitff was a contractor. He entered into a contract with the municipal committee for construction of some work. He completed the work as per the work order. Running payment of Rs.2500/- was made by the defendant-Municipal Committee and he filed the suit for the recovery of the remaining amount. In the written statement it was pleaded that the agreement was not executed in accordance with Section 47 of the Punjab Municipal Act, 1911 (This Section 47 of the Punjab Municipal Act, 1911 is analogues to Section 50 of the Haryana Municipal Act, 1973). Taking note of the legal position Hon'ble High Court has laid down as under: - There is no denying the fact that no valid agreement has come into existence as contemplated by Section 47 of the Punjab Municipal Act. Resolution of the Municipal Committee Exhibit P-13 authorising the President to invite for tenders and execution of the work as per work orders Exhibits P-3 to P-6 by the plainitff cannot constitute a valid contract, but all the same it cannot be lost sight of that the plaintiff executed the work in pursuance of the Resolution of the Municipal Committee Exhibit P13 and is entitled to compensation in terms of Section 65 of the Indian Contract Act. Section 65 of the Indian Contract Act reads as under: - 65. Obligation of person who has received advantage under void agreement or contract that becomes void. When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it or to make compensation for it, to the person from whom, he received it. Thus when an agreement is discovered to be void or becomes a void any person who has taken advantage under such agreement or contract is bound to restore it or give compensation for the same. Similarly Section 70 of the Indian Contract Act envisages awarding of compensation to a person who has done anything for another and who did not intend to do so gratuitously.” It is pertinent to mention here that though in the bills, the plaintiff had claimed that interest @ 18% would be charged on delayed payment and learned trial Court accepted the claim of interest. The learned appellate Court taking into consideration, the present rate of interest reduced the interest to 12%. the finding recorded on other issues was affirmed. R.S.A. No. 321 of 2009 (O&M) -4- The learned counsel for appellants contends that following substantial questions of law arise in present appeal: - "1. Whether contract executed in violation of Section 50 of the Haryana Municipal Act, could be enforced? 2. Whether learned Courts below erred in drawing adverse inference, even though record i.e. stock register was produced in Court?" The first substantial question of law does not arise as the learned Courts below rightly rejected the plea and the findings recorded are as per settled law. The second question of law as framed does not arise as admittedly the stock register was not proved, thus could not be read in evidence. No merit. Dismissed. (Vinod K. Sharma) Judge January 19, 2009 R.S.