THE HON'BLE SRI JUSTICE NOOTY RAMAMOHANA RAO WRIT PETITION No : 27387 of 2010 O R D E R: The writ petitioner is challenging the validity of the proceedings, dated 01.10.2010 issued by the respondent Municipality. Through the impugned final notice, dated 01.10.2010, the Commissioner of the respondent Municipality has communicated to the writ petitioner that the respondent Municipality through their resolution No. 197/2010, dated 15.09.2010, has resolved to extend the time for completion of the constructions up to 31.10.2010. It was further informed that if the contractor fails to complete the work, then the work order may be cancelled and the EMD, FSD will be forfeited and the contractor will be blacklisted as per rules. The grievance of the writ petitioner is that though the respondent Municipality has passed resolution No. 12/2006, dated 29.04.2006 to award the work relating to construction of municipal office complex to him, the actual agreement has been entered into by and between the parties only on 01.08.2006 and there was also further delay in handing over the site to the writ petitioner, which was done sometime during December 2006. The agreement stipulated the work to be completed within a period of six months. Thus, according to the writ petitioner, enormous time has been consumed by the respondent municipality in handing over the site and hence, the writ petitioner cannot be faulted for not completing the constructions within the stipulated period of six months. Further, to this problem, the prices of the essential ingredients for the construction, namely cement and steel have gone up steeply in the year 2007 and hence, the writ petitioner also could not complete the constructions. It was also further pointed out that the builders’ association of India, being alive to the problems faced by the contractors, have represented to the State Government and the State Government responded favourably to the request of the builders’ association by announcing their policy decision through G.O.Ms.No. 94, Transport, Roads & Buildings (R.I) Department, dated 16.04.2008, allowing the price adjustment for steel and cement every month and they have also devised the formula for securing the said adjustment. It was further contended that the State Government took further time to pass orders through their memo dated 26.11.2009, extending the benefits contained in G.O.Ms.No. 94, but however, the respondent Municipality, without any regard for these policy measures adopted by the State Government and without referring to the price adjustment of the steel and cement, has been passing orders extending time for completion of the work entrusted to the writ petitioner. The petitioner further contends that in spite of the hardship faced by him, he has completed nearly 70% of the building and he is also making further progress in spite of the increase of prices including the wages of the labour. Therefore, the action of the respondent municipality in granting the petitioner extension of time for completion of the project only up to 31.10.2010 is improper and incorrect. Sri T.S. Anand, learned counsel for the writ petitioner, submits that the respondent municipality is acting contrary to the policy decision taken by the State Government and announced through their G.O.Ms.No. 94, as well as the subsequent orders passed by the State Governemnt in their memo dated 26.11.2009. The respondent municipality has not so far extended and applied the price variation formula to the contract awarded to the writ petitioner. It is unfair for the respondent municipality to expect the writ petitioner to pay from out of his pocket and build the municipal office complex. The learned counsel would further submit that the respondent municipality is not adverting to the decision of the State Government for adopting the price variation formula to such of the contracts which were awarded prior to the decision announced by the State Government. The learned counsel would further submit that there are compelling circumstances and reasons for the writ petitioner not to have completed the constructions and the blame in that regard entirely lies on the respondent municipality, but not on the petitioner. It was further urged by the learned counsel that all that the writ petitioner is seeking in this Writ Petition is a direction to the respondent to take into account and consideration his request made in the representations submitted by him to the respondent municipality on 17.09.2010 and 01.10.2010, for applying the price variation formula to his contract, so as to enable the writ petitioner to complete the construction of the municipal complex. I am afraid, that this Writ Petition is not maintainable. The petitioner entered into a contract, admittedly with the respondent municipality on 01.08.2006. He was required to complete the construction of the building within a period of six months. According to the writ petitioner, he could not perform his part of the obligations due to the fault of the respondent municipality in delayedly delivering the possession of the vacant site which they did sometime during December 2006. Whether it is the respondent or the petitioner who has committed the breach of terms of the contract, is a question, which is incapable of being resolved in a Writ Petition. It requires collection of evidence from both sides. Therefore, by way of a prudent practice developed over a long period of time, the Courts are reluctant to entertain the Writ Petitions, which require collection of evidence for resolution of the core dispute. The appropriate remedy would have been to approach the competent civil Court, where both sides would be free to lead evidence considered appropriate. Further, Section 73 of the Indian Contract Act, 1872 specifically sets out that compensation for loss or damage by breach of contract by one party is liable to be awarded to the other and such compensation is not to be given for any remote or indirect loss or damage sustained by reason of the breach. It would therefore, be appropriate for the civil Court to examine whether the loss or damage said to have been sustained by the writ petitioner all due to the alleged breach committed by the respondent municipality is whether direct or remote and based thereon, appropriately remedy the breach by awarding the compensation to the writ petitioner. How far the failure of the respondent to extend the benefit of price variation formula of the components, such as steel and cement, pursuant to a policy decision taken by the State Government on 16.04.2008, is a question, therefore, that has to be examined by the competent civil Court, inasmuch as if the damage sustained by the writ petitioner herein is a remote one, then, the petitioner is not liable to be compensated to the whole of the extent. In my opinion, these questions can better be addressed only by a competent civil Court, upon collection of evidence from both sides. Hence, I consider that the remedy availed by the writ petitioner is not the proper remedy. The Writ Petition is therefore, dismissed at the admission stage. No costs. ---------------------------------- Nooty Ramamohana Rao, J 8th November 2010 Issue CC tomorrow. ksld ..... REGISTRAR // TRUE COPY // SECTION OFFICER To 1.2CCs to 2.2CD copies Form-NIC-OGS/WP{TRK}