IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 29.7.2011 CORAM THE HON'BLE MR.JUSTICE A. ARUMUGHASWAMY A.S.NO.26 of 2003 and Tr.A.S.No.252 of 2007 1. M. Nadarajan (Died) 2.N. Murugasamy 3.N. Balan 4.N.Selvaraj (Appellants 2 to 4 are brought on record as L.Rs. of the deceased sole appellant vide order of the Court, dated 5.11.2009 made in C.M.P.Nos.1567 to 1569 of 2009) .. Appellants in A.S.No.26 of 2003/LRs of the plaintiff -Vs.- 1.Union of India represented by Chief Secretary to Govt. of Union Territory of Pondicherry, Pondicherry. 2.Secretary Public Works Department Govt. of Union Territory of Pondicherry, Pondicherry. 3.Superintendenting Engineer Circle II Public Works Department Govt. of Union Territory of Pondicherry, Pondicherry. 4.Executive Engineer Irrigation Division Public Works Department Pondicherry. .. Respondents in A.S.No.26 of 2003/Defendants 1.Union of India represented by Chief Secretary to Govt. of Union Territory of Pondicherry, Pondicherry. 2.Secretary Public Works Department Govt. of Union Territory of Pondicherry, Pondicherry. https://hcservices.ecourts.gov.in/hcservices/ 3.Superintendenting Engineer Circle II Public Works Department Govt. of Union Territory of Pondicherry, Pondicherry. 4.Executive Engineer Irrigation Division Public Works Department Pondicherry. .. Appellants in Tr.A.S.No.252 of 2007/Defendants V. 1.M. Nadarajan 2.N.Murugasamy 3.N.Balan 4.N.Selvaraj ..Respondents in Tr.A.S.No.252 of 2007/ LRs of the plaintiff [Respondents 2 to 4 brought on record as LRs of the deceased Sole Respondent vide order of court dated 29.7.2011, made in Common Judgment in A.S.26/2003, and Tr.A.S.252/2007. [Memo filed dated 13.09.2011 USR No.5796/2011] Prayer:- Firt appeals are filed under Section 96 C.P.C., against the judgment and decree dated 23.4.2002, passed in O.S.No.184 of 1999 on the file of the Additional Subordinate Judge at Pondicherry. For Appellants in A.S.26 of 2003 and Respondents in TR.A.S.252 of 2007 : Mr. V. Karunakaran for M/s.G.M. Mani Associates For Respondents in S.D.26 of 2003 and Appellants in Tr.A.S.252 of 2007 : Mrs.Mala Additional Govt. Pleader C O M M O N J U D G M E N T Aggrieved by the judgment and decree, dated 23.4.2002, passed in O.S.No.184 of 2009 by the Additional Sub Judge, Pondicherry, while the plaintiff filed the appeal in A.S.No.26 of 2003, the defendants have also filed the appeal in A.S.No.141 of 2002, which has been renumbered as Tr.A.S.No.252 of 2007. The memo filed by the appellant in Tr.A.S.No.252 of 2007 is recorded. https://hcservices.ecourts.gov.in/hcservices/ 2. For the sake of convenience, the parties are mentioned as per their rank in A.S.No.26 of 2003. 3. The case of the plaintiff is as follows:- a. The plaintiff is the Class-I unlimited contractor in Pondicherry. The plaintiff was given the work of improvements of Oulgret Pallamadugu Drainage Channel from Railway Culvert upto Marapalam and the plaintiff offered to work for a sum of Rs.27,12,898/- and he being the lowest tenderer, his tender was accepted by the third defendant and work order was given by the 4th defendant on 20.10.1994. The work could not be carried out because of heavy rain and due to technical defect caused by the department in preparing the plan and estimate and because of inadequacy of planning and flaw in technical guidance, he sustained heavy loss due to escalation of prices. The plaintiff did the work to the tune of Rs.7,36,590/-. But he was paid only Rs.5,93,200/-. A sum of Rs.88,920/- was deducted towards cement supplied by the department and a sum of Rs.16,314/- was withheld by the department towards income tax and security deposit recovery. Still the department has to pay a sum of Rs.38,148/- for having done the work towards the value of Rs.7,36,950/-. As the department did not pay Rs.38,148/- due to him, the plaintiff could not get the refund of security deposit of Rs.72,649/- at 18% p.a. from 3.7.1996 to 7.6.1999, which amounts to Rs.20,173/-. b. It is further stated that the plaintiff is also entitled to contract profit at 10% on the accepted tender minus the amount of work done by him due to the foreclosure of the contract by the third defendant on 12.11.1998 and the plaintiff is entitled to a sum of Rs.8,66,166/- from the defendants jointly and severally. After issuing notice to the defendants, the present suit has been filed for the recovery of a sum of Rs.8,66,166/- against the defendants. 4. The defendants contested the suit by filing their written statement inter alia contending that the plaintiff has miserably failed to complete the work in time and in fact only a portion of the work assigned was completed that too after in- ordinate delay and therefore, they sought for the dismissal of the suit. 5. Before the trial Court, on the side of the plaintiff one witness was examined and Exs.A1 to A15 were marked and on the side of the defendants also one witness was examined and Exs.B1 to B13 were marked. 6. On a consideration of the oral and documentary evidence, the Court below partly decreed the suit in favour of the plaintiff directing the defendants to pay jointly and severally a sum of https://hcservices.ecourts.gov.in/hcservices/ Rs.2,08,346/- with interest at 12% p.a. 7. Aggrieved by the same, both the plaintiff and the defendants have filed the appeals as aforesaid. 8. The points for consideration in these appeals are:- a. Whether the plaintiff is entitled for the actual balance amount of Rs.38,148/- or not? b. Whether the plaintiff is entitled for the return of the E.M.D. Amount. c. Whether the plaintiff is entitled for the contract profit at 5% as awarded by the Court below ? d. Whether the plaintiff is entitled for the interest for the said amounts, if so, from which date ? 9. Heard the learned counsel for the appellants and the respondents in both the appeals. 10. The learned counsel for the appellant/plaintiff vehemently contended that though there was laches on the part of the Government, the Government has foreclosed the contract work given to the plaintiff and because of that he has incurred loss under various heads and therefore, he prayed that the appeal filed by him has to be allowed. 10a. Further, the learned counsel for the appellant/plaintiff has confined his argument only in respect of the amount payable under the two heads, namely, the balance amount of Rs.38,148/- and the E.M.D. amount. 11. Per contra, the learned Additional Govt. Pleader contended that they have also filed the appeal questioning the award of the amount under two heads, which have to be rejected and further he contended that the claim of the appellant/plaintiff has to be negatived since the laches is only on the part of the appellant/plaintiff in not completing the work in the given time and because of that the Government has incurred revenue loss. 12. I have considered the aforesaid submissions and perused the materials available on record. 13. It is not in dispute that the work order has been given on 20.10.1994 and the work was commenced on 25.2.1995 and the work was foreclosed by the third defendant on 12.11.1998. It is also not in dispute that the contract work was awarded at Rs.27,12,898/- and the plaintiff has received only Rs.5,93,200/-. https://hcservices.ecourts.gov.in/hcservices/ 14. After elaborately considering the oral and documentary evidence, the trial Court has come to the conclusion that the balance amount of Rs.38,148/- has to be paid to the appellant/plaintiff for the work done by him. 15. A perusal of the evidence also shows that for the work done by the plaintiff, he is entitled to claim a sum of Rs.38,148/-. Though the learned Additional Govt. Pleader contended that the appellant/plaintiff is only entitled for a sum of Rs.27,047/- no documentary evidence has been produced either before the Court below or this Court and therefore, the Court below has come to the right conclusion that on the measurement the plaintiff is entitled for the balance amount of Rs.38,148/- and in such circumstances, I am of the view that the plaintiff is entitled for the balance amount of Rs.38,148/-, which has to be paid by the defendants. 16. As far as the E.M.D. amount is concerned, the trial Court has rightly held that as per the agreement under Ex.A1 the E.M.D. amount is only a sum of Rs.71,383/- and not Rs.72,649/- as claimed by the appellant/plaintiff and therefore, I am of the view that when the contract is foreclosed, the E.M.D. amount is liable to be returned to the appellant/plaintiff and accordingly, the appellant/plaintiff is entitled to get a sum of Rs.71,383/- towards E.M.D. amount and not Rs.72,649/- as claimed by the appellant/plaintiff. 17. As far as the claim of contract profit is concerned, though the plaintiff claimed the contract profit of 10% on the accepted tender minus the amount of work done by him to the tune of Rs.1,97,630/-, the Court below considering all the circumstances, awarded 5% on the accepted tender minus the amount of work done by the plaintiff, namely, Rs.98,815/-. 18. The learned counsel for the appellant/plaintiff contended that the price has been escalated and 10% interest on the contract profit is generally given in these type of contract cases. Considering the escalation of price, the contract profit may be awarded as prayed for. 19. On the other hand, the learned Additional Govt. Pleader contended that since the plaintiff accepted the tender, the question of escalation of price does not arise. Since there is laches on the part of the appellant/plaintiff in completing the work in the given time, the appeal has to be dismissed. 20. However, I am of the view that the amount of Rs.98,815/- towards contract profit awarded by the Court below is on the higher side and I am inclined to restrict the same to the tune of Rs.50000/- and accordingly, the same is awarded. https://hcservices.ecourts.gov.in/hcservices/ 21. Since the appellant/plaintiff is legally entitled for the above said amounts, namely, the balance amount of Rs.38,148/-, the E.M.D. amount of Rs.71,383/- and Rs.50000/- towards contract profit, the said amounts shall be paid to the appellant/plaintiff with interest at the rate of 12% p.a. from the date of foreclosure of the contract, namely, 12.11.1998. 22. For the aforesaid reasons, the appeal filed by the plaintiff in A.S.No.26 of 2003 is partly allowed to the extent as indicated above, whereas the appeal filed by the defendants in Tr.A.S.No.252 of 2007 is also partly allowed by reducing the contract profit to Rs.50000/- from Rs.98,815/-. However, there will be no order as to costs. 23. The judgment and decree of the trial Court is modified to the effect that:- The plaintiff is entitled for :- a. The balance amount of Rs.38,148/- for the work done by him; b. Rs.50000/- instead of Rs.98,815/- towards contract profit; c. Rs.71,383/- towards E.M.D. amount and all the said amounts shall be paid to the appellant/plaintiff with interest at the rate of 12% p.a. from the date of foreclosure of contract i.e.12.11.1998 till realisation. Sd/ Asst.Registrar //True Copy// Sub.Asst.Registrar rnb To The Additional Subordinate Judge, Pondicherry. 2 cc to M/s.G.M. Mani Associates , Advocate, Sr.No.46334 2 cc To Government Pleader, SR.No.46416 and 46418 A.S.NO.26 of 2003 and Tr.A.S.No.252 of 2007 ksk(co) pmk.14.10.2011 https://hcservices.ecourts.gov.in/hcservices/