HON’BLE SRI JUSTICE G.V. SEETHAPATHY C.C.C.A. No.19 of 1994 and TRANSFER C.C.C.A. No.293 of 2006 Date: August 12, 2010 C.C.C.A. No.19 of 1994 Between: 1. APSRTC, represented by its Chief Civil Engineer, Musheerabad, Hyderabad and another. … Appellants And K. Sivanagi Reddy … Respondent * * * TRANSFER C.C.C.A. No.293 of 2006 Between: K. Sivanagi Reddy. … Appellant And 1. The A.P. State Road Transport Corpn., rep. by its Chief Civil Engineer, Musheerabad, Hyderabad and another. … Respondents * * * HON’BLE SRI JUSTICE G.V. SEETHAPATHY C.C.C.A. No.19 of 1994 and TRANSFER C.C.C.A. No.293 of 2006 COMMON JUDGMENT: These two appeals arise out of the judgment dated 18.6.1993 in O.S. No.172 of 1990 on the file of I Additional Judge, City Civil Court, Hyderabad, wherein the claim of the respondent-plaintiff for recovery of a sum of Rs.34,000/- was allowed in part granting a decree for recovery of a sum of Rs.25,000/- and rejecting the claim for interest. 2. The APSRTC filed C.C.C.A. No.19 of 1994 assailing the said decree and judgment and the plaintiff filed A.S. No.4 of 1995 before the Chief Judge, City Civil Court, Hyderabad in respect of the claim for interest, a sum of Rs.9,000/-. Subsequently, A.S. No.4 of 1995 was withdrawn to this Court and numbered as Tr.C.C.C.A. No.293 of 2006. 3. As both the appeals arise out of the same judgment, they are heard together and disposed of by this common judgment. 4. Heard the learned standing counsel for APSRTC, the appellant in C.C.C.A. No.19 of 1994, perused the record. None appears for the respondent-plaintiff. 5. The APSRTC called for tenders for construction of bus-depot at Rayadurg, Anantapur District in February 1987. The plaintiff was one of the tenderers. He submitted the tender to the first defendant by paying a sum of Rs.25,000/- towards earnest money deposit as required under tender conditions. The plaintiff was called for negotiations by the first defendant, Chief Civil Engineer of APSRTC at his office on 21.3.1987. According to the plaintiff, he could not attend the meeting for negotiations, as he was seriously ill and informed the same to the defendants. He did not receive any intimation for rejecting his tender nor the earnest money deposit was refunded to him in spite of representations. The plaintiff having waited for two years issued a notice dated 07.9.1989 demanding refund of the earnest money deposit with interest at 24% per annum. There is no response from the defendants. Hence, the suit. 6. The defendant-APSRTC filed a written statement contending that as the plaintiff was found to be lowest tenderer among the three tenders received, he was called for negotiations by letters dated 10.3.1987, 21.3.1987 and 25.3.1987. The plaintiff did not attend the negotiations even on 02.4.1987. He sent a letter dated 09.4.1987 enclosing a medical certificate dated 04.4.1987, issued by a children specialist in Hyderabad, that he was prevented from taking up the work due to ill health. Thus, according to the defendants, as the plaintiff failed to fulfil his commitment to attend the negotiations and take up the work, the earnest money deposit of Rs.25,000/- stood automatically forfeited on 02.4.1987 and there was no need for the defendants to inform the plaintiff or refund the earnest money deposit which stood forfeited. The defendant also contended that the suit is barred by limitation and the court has no jurisdiction. 7. On the strength of the pleadings, the trial court framed the following issues: 1) Whether the action of the defendants in forfeiting the EMD of plaintiff is justified? 2) Whether the suit is bad for not suing the 1st defendant in the names of its Vice-Chairman and Managing Director? 3) Whether the suit is time barred? 4) Whether this court is having territorial jurisdiction? 5) Whether the plaintiff is entitled to return of EMD with interest @ 18% p.a.? 6) To what relief? 8. During the trial the plaintiff was examined as P.W.1 and Exs.A- 1 to A-5 were marked on his behalf. D.W.1 was examined and Exs.B- 1 to B-5 were marked on behalf of the defendants. 9. On consideration of evidence available on record, the trial court held that the defendants are not entitled to forfeit the earnest money deposit and the plaintiff is entitled for refund of the same. The trial court rejected the claim for interest made by the plaintiff at 18% per annum on the ground that there is no stipulation for payment of interest under the terms and conditions of the tender. Aggrieved by the said judgment and decree the present appeals are filed one by the plaintiff and another by the defendant. 10. The only question, which arises for consideration in these appeals, is whether the plaintiff is entitled for refund of the earnest money deposit. Ex.B-1 is the general and special conditions of tender. There is no dispute regarding the plaintiff becoming the successful tenderer having quoted the lowest. The special conditions at page 4 of Ex.B-1 are stated as follows: “After the tenders are received when contractors are called for negotiations they should attend for negotiation invariably within one month of receipt of negotiation letter. If the contractor fails to attend for negotiations within one month from the date of receipt of negotiation letter, CCE/EE, APSRTC, reserves the right to cancel the tender after confiscation of the EMD.” 11. As seen from the above terms and conditions, the plaintiff was required to attend the negotiations within one month after receipt of the letter. It is not disputed that the plaintiff received the letter from the defendant asking him to attend the negotiations on 02.4.1987, but he did not attend the same on the ground of ill health. He sent a letter dated 09.4.1987 enclosing medical certificate dated 04.4.1987 stating that he was prevented from taking up of the work on account of ill health. That the plaintiff failed to attend the negotiations in spite of receiving the letter from the defendant is, thus, not in dispute. However, what all the tender conditions extracted above contemplate is that if the contractor failed to attend the negotiations, the CCE/EE, APSRTC reserved the right to cancel the tender after confiscation of the earnest money deposit. Thus, the course left open to the defendants on account of failure of the plaintiff to attend the negotiations is exercise the right to cancel the tender after confiscation of earnest money deposit. Admittedly, no such proceedings confiscating the earnest money deposit and cancelling the tender of the plaintiff were issued nor communicated to the plaintiff. There is absolutely nothing on record to show that in exercise of the right conferred on them by the above special conditions, the APSRTC has confiscated the earnest money deposit of the plaintiff or cancelled the tender and intimated the same to the plaintiff. The contention of the defendant that the earnest money deposit stood automatically cancelled on account of failure of the plaintiff to attend the negotiations is untenable for the reason that the tender conditions do not contemplate any such automatic confiscation of the earnest money deposit or cancellation of the tender. The claim of the defendant that the earnest money deposit of the plaintiff stood automatically cancelled and there is no need to intimate the same to the plaintiff is therefore without any basis. The trial court has therefore rightly held that there was no cancellation or confiscation of earnest money deposit by the defendant and no intimation thereof was also given to the plaintiff and, therefore, the plaintiff is entitled to recover the same. When the tender conditions do not stipulate that earnest money deposit stands forfeited automatically on account of any breach of the conditions on the part of the plaintiff, the plaintiff is certainly entitled to recover the earnest money deposit amount in the absence of any proceedings issued by the defendant duly confiscating the earnest money deposit by invoking the right to do so reserved under the terms and conditions of the tender. 12. The trial court has also rightly rejected the claim for interest made by the plaintiff on the ground that the terms and conditions of the tender do not stipulate payment of any interest. In fact, as the plaintiff himself did not attend the negotiations in spite of intimation by the defendant, he is not entitled to claim any interest, especially, when the tender conditions do not contain any stipulation for payment of interest. 13. In the circumstances, it is held that the impugned judgment of the trial court granting a decree for recovery of Rs.25,000/- in favour of the plaintiff and rejecting his claim for interest do not call for any interference by this Court. 14. In the result, both the appeals are dismissed. There shall be no order as to costs. _______________________ G.V. SEETHAPATHY, J Date: August 12, 2010. BSB