IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Regular Second Appeal No.3889 of 2010 (O&M) Date of decision: 28th September, 2011 The Machaki Mal Singh Cooperative Labour & Construction Society Ltd. … Appellant Versus State of Punjab and others … Respondents CORAM: HON’BLE MR. JUSTICE KANWALJIT SINGH AHLUWALIA Present: Mr. Sanjeev Kumar Arora, Advocate for the appellant. KANWALJIT SINGH AHLUWALIA, J. Present appellant-The Machaki Mal Singh Cooperative Labour & Construction Society Ltd. had instituted a suit for rendition of accounts with regard to the work done by plaintiff-Society as labour contractor qua the Water Works Scheme of village Ghumiara, Tehsil and District Faridkot including the execution of construction work of quarters etc. and had sought a decree of the amount to be found due with interest @ 18% per annum on the arrears of amount due and recoverable, and in the alternative had sought mandatory injunction praying that the defendants be directed to make payment of the amount due along with interest @ 18% per annum. The plaintiff-Society had further sought a consequential relief of permanent injunction restraining the defendants from unnecessarily interfering into the execution of remaining 10% work of the contract. Briefly stated, in the suit filed it was pleaded that the plaintiff- Society was allotted the work of Water Works Scheme of village Ghumiara including the work of construction of quarters for a sum of Rs.5,45,000/-. The work was to be executed and completed within a Regular Second Appeal No.3889 of 2010 (O&M) period of six months from the date of agreement. The State Government- defendants were to supply cement, iron rods and pipes to the plaintiff- Society whereas bricks, sand and labour etc. were to be arranged by the plaintiff-Society to execute the said work. As per the agreement/tender, the plaintiff-Society commenced the work of said Scheme of Water Works of village Ghumiara within the specified time and arranged necessary material to be supplied by the Society itself. It was stated that 90% of the work of the Scheme was completed. The plaintiff-Society failed to execute the remaining 10% work due to unnecessary interference and non-supply of material by defendant No.3-Malkiat Singh Junior Engineer, Public Health (Water Works and Sewerage Division), Faridkot. It was stated that defendant No.3 also played a fraud with the plaintiff-Society. Signatures of Chhinder Singh (duly authorized member of the plaintiff-Society) were obtained on the indent but actually they were not supplied. It was further stated that the plaintiff-Society was ready with the material to fix the doors of quarters, but since payment of the bills was not released qua the already executed work and rendition of the accounts was not done by the Government, therefore, the plaintiff-Society was left with no other option except to file the suit for rendition of accounts and payment of outstanding bills. A notice to this effect was also issued on 8th December, 1994. Left with no other option, the suit was instituted. Upon issuance of notice of the suit, written statement was filed by the defendants wherein they stated that the suit is not maintainable and that there was a binding arbitration agreement between both the parties, i.e. plaintiff-Society and the defendants. It was further stated that as per Section 8 of the Arbitration and Conciliation Act, 1996, 2 Regular Second Appeal No.3889 of 2010 (O&M) the matter was rightly referred for arbitration to the Arbitrator-cum- Superintending Engineer, Public Health (RWS Circle), Faridkot by Civil Judge (Junior Division), Faridkot on 29th August, 1997. It was further stated that the plaintiff-Society had filed an application on 13th February, 1998 for recalling of the order passed on 29th August, 1997, but that application was dismissed. On merits, it was stated that the work was to be executed and completed by the plaintiff-Society latest by 28th April, 1992 but having failed to do so the Society sought extension of time up to 30th June, 1992. The extension was granted but the Society again failed to stick to its commitment and badly failed to complete the work even within the stipulated time. Again an extension was sought. As the same amounted to breach of contract, the Engineer In-charge, i.e. defendant No.2 had levied a compensation @ 10% of the agreement amount, i.e. Rs.54,500/- vide his letter dated 9th September, 1992. Rest of the averments made in the suit were denied. Plaintiff-Society filed replication in which the averments made in the written statement were denied and that of the plaint were reiterated. The trial Court had formulated following issues: “1. Whether the plaintiff is entitled to decree for rendition of account, if so at what extent? OPP 2. Whether the suit is not maintainable? OPD 3. Whether the defendants are entitled to counter claim as prayed for? OPD 4. Relief.” The trial Court decided issues No.1 and 3 together partly in favour of the plaintiff-Society and held it entitled to recover Rs.5,620/- along with interest @ 6% per annum from the date of filing of the suit till 3 Regular Second Appeal No.3889 of 2010 (O&M) realization of the amount. Issue No.2 was also decided against the defendants and in favour of the plaintiff-Society. Aggrieved against the same, defendants No.2 and 3 and the plaintiff-Society filed three separate appeals, which were decided vide a common judgment by the lower appellate Court. The lower appellate Court held that it is an admitted case of the defendants that an amount of Rs.5,620/- was to be paid to the plaintiff-Society qua the final payment. The claim of defendants that Rs.31,825/- for 335 bags of cement were liable to be recovered from the plaintiff-Society, was found without any merit as the defendants had failed to lead any evidence to this effect. The lower appellate Court noticed the admission made by Tejpal Singh DW-1 in cross-examination that an amount of Rs.5,620/- was due towards the defendants. The lower appellate Court further held as under: “12. Since the work has been got completed by the defendant from some other contractor, the plaintiff is not entitled to the amount claimed. It has been admitted by the plaintiff that payment of bills from 28.2.1992 to June 1993 has already been made.” The Court further noticed that since the plaintiff-Society had withdrawn the suit against Malkiat Singh-defendant, therefore, no liability of Malkiat Singh-defendant will arise. The lower appellate Court accepted the appeal filed by Malkiat Singh, whereas dismissed the appeals preferred by present appellant-plaintiff-Society and defendant no.2 to the suit. I have heard Mr.Sanjeev Kumar Arora, Advocate for the appellant-plaintiff. He has stated that the courts below, relying upon the admission made by the defendants during cross-examination, had 4 Regular Second Appeal No.3889 of 2010 (O&M) decreed the suit to the extent of Rs.5,620/-, but they had not decreed the suit for rendition of accounts. According to the counsel, Tejpal Singh, Sub Divisional Engineer DW-1 had admitted in cross-examination that an amount of Rs.2,56,818/- was to be paid to the appellant but a sum of Rs.92,681/- was paid. Counsel has further stated that to determine factually as to how much amount was actually due, the defendants ought to have been asked for rendition of the accounts of work done and the payment made to the appellant-plaintiff. I am not impressed by the arguments raised by counsel for the appellant. In ‘K.C. Skaria v. Govt. of State of Kerala and another’ 2006(2) SCC 285, it was held by Hon’ble the Apex Court as under: “16. To summarise, a suit for rendition of accounts can be maintained only if a person suing has a right to receive an account from the defendant. Such a right can either be (a) created or recognized under a statute; or (b) based on the fiduciary relationship between the parties as in the case of a beneficiary and a trustee, or (c) claimed in equity when the relationship is such that rendition of accounts is the only relief which will enable the person seeking account to satisfactorily assert his legal right. Such a right to seek accounts cannot be claimed as a matter of convenience or on the ground of hardship or on the ground that the person suing did not know the exact amount due to him, as that will open the floodgates for converting several types of money claims into suits for accounts, to avoid payment of court fee at the time of institution. 17. Let us now examine whether a contractor engaged to execute a particular work, can file a suit for accounts against the employer in regard to payment for the work done. Such a right is not created or recognized by any statute. The independent contractor is not an agent of the employer. Nor is the employer in the position of a trustee 5 Regular Second Appeal No.3889 of 2010 (O&M) with reference to the independent contractor. Can the claim be supported in equity by stating that where the relationship is such that rendition of accounts is the only relief which will enable the contractor to satisfactorily assert his legal right? A contractor who is engaged to execute a work, is expected to maintain his own accounts. At all events, there is no bar for a contractor to keep an account of the work done. Even where the contract between the employer and independent contractor may provide for payment on the basis of measurements to be recorded by the employer, nothing prevents the contractor from measuring the work done by him and then suing for the value of the work done. The contractor may also demand joint-measurements to determine the quantum of work done. If the employer for some reason does not co-operate or prevents the contractor from taking a physical measurements, the contractor can seek appropriate legal remedy which will enable him to take measurements or to secure the information from the measurement book in the custody of the employer. Therefore, either the fact that the measurement book is maintained by the employer, or the fact that the contractor does not possess the exact measurements, will not entitle the contractor to file a suit for rendition of accounts against the employer. 18. In this case, the appellant could have either himself measured the work done by him or secured the information from the respondents. The appellant has neither made out a right under a statute nor any fiduciary relationship nor any right in equity by establishing that except by calling upon the defendants in the suit to render accounts, it is not possible for him to get relief. The appellant has sued for Rs.2 lakhs and paid court fee thereon. Nothing prevented him from suing for Rs.5,33,000/-. In para 5 of the plaint, he states that the total value of work done by him was Rs.10,00,000/-. He knew that he had been paid only Rs.4,04,628/- . He also knew the value of material supplied 6 Regular Second Appeal No.3889 of 2010 (O&M) by the employer. In the circumstances, the prayer for rendition of accounts is not maintainable.” In view of the observations made by Hon’ble the Apex Court in K.C. Skaria’s case (supra), the arguments raised by counsel for the appellant are not tenable. Furthermore, both the courts below have given a concurrent finding of fact that there was a failure on the part of the appellant-plaintiff-Society to execute and complete the work allotted to it within a stipulated period. It is also specifically pleaded by the defendants that the matter was referred to the Arbitrator and a penalty was also imposed upon the Contractor. The findings returned by the courts below are unassailable. This Court will not re-appreciate or do re-appraisal of the evidence already meticulously examined by both the courts below. Thus, no interference by this Court is warranted as counsel for the appellant during course of arguments has failed to formulate any question of law much less a substantial one for consideration of this Court. Hence, there is no merit in the present appeal and the same is hereby dismissed. [KANWALJIT SINGH AHLUWALIA] JUDGE September 28, 2011 rps 7