Lsp IN IN IN THE THE THE HIGH COURT OF JUDICATURE AT BOMBAY HIGH COURT OF JUDICATURE AT BOMBAY HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION COMPANY PETITION NO. 16 of 2009 SRKAY Infra Equipments Pvt.Ltd. ...Petitioner v/s. Gammon India Ltd. ...Respondents Sanjay Jain i/b. Vinod Mistry & Co. for the petitioner. Vivek Kantawala i/b. M & M Legal Associates for the Respondents. CORAM CORAM CORAM : A.M.KHANWILKAR,J. : A.M.KHANWILKAR,J. : A.M.KHANWILKAR,J. DATED DATED DATED : MAY 02, 2009. : MAY 02, 2009. : MAY 02, 2009. P.C. . Heard Counsel for the parties. 2. After having perused the documents and pleadings on record, I have no hesitation in observing that the Petitioner has made out prima-facie case atleast in respect of claim with regard to Excavator Hire Charges, Rockbreaker Hire charges and partly with regard to 4% CST amount payable by the Petitioner. According to the Petitioner, the total amount payable by the Respondent company is in the sum of Rs. 29,16,406/-. The Petitioner is relying on the TDS Certificate issued by the Respondent company dated 20/6/2008 at page-136 which mentions the outstanding amount payable by the Respondent company to the Petitioner as Rs.16,36,282/-. The Petitioner issued statutory notice to the Respondent claiming amount of Rs.26,89,528/- on 23rd June, 2008. After receipt of said statutory notice, the Respondent 2 company paid amount of Rs. 4,00,000/- to the Petitioner on 1st July, 2008. Lateron, however, the Respondent company sent Advocate’s reply on 8th August, 2008 disputing the correctness of the stand of the Petitioner stated in the statutory notice. The Respondent denied the claim of the Petitioner for various reasons. 3. On the other hand, according to the Petitioner the Petitioner in the first place submitted bills as per the agreement between the parties against which the Respondent made payment from time to time without any demurrer. The Petitioner sent 28 telegram notices which are at pages-92 to 130 of the paperbook. At no point of time the Respondent raised any grievance regarding the correctness of the stand of the Petitioner or the claim of the Petitioner. All the objections have been placed on record by the Respondent company only in the reply given to the statutory notice which was sent through Advocate. Obviously, the reply is on the basis of legal advice given to the Respondent company. Significantly, no document is forthcoming to substantiate the stand of the Respondent that at the earliest opportunity, the Respondent raised the dispute with regard to each of the claims of the Petitioner. 4. Be that as it may, the Petitioner claims the above said outstanding amount with reference to six different 3 heads. The first head is towards Excavator Hire Charges, Second towards Food and Accommodation charges, third towards Mobilisation charges and fourth towards Rockbreaker Hire Charges, fifth towards tax amount and lastly towards interest claim of the Petitioner on the outstanding dues. 5. In so far as the first head is concerned, namely, Excavator Hire Charges, the document that needs to be adverted to consider Petitioner’s claim or the liability of the Respondent is at page-32. Item-2 of the said document refers to Rate and Hire charges which reads thus: "Rate-- Hire charges shall be Rs.1,82,000/- (Rupees One Lakh eight two thousand only) per 260 hours work per month exclusive of Diesel. Over and above 260 hours work shall be paid to you on pro-rata basis." 6. On plain reading of this condition, I am prima-facie in agreement with the argument of the Petitioner that the Respondent was liable to pay Hire charges at the rate of minimum Rs. 1,82,000/- per month for usage of Excavator per 260 hours. In case the usage was to exceed 260 hours, the Respondent was liable to pay further charges on pro-rata basis. The Petitioner 4 from time to time submitted bills on this understanding. First bill was raised on 2/11/2006 after the machine reached site on 13/10/2006. Subsequent bills were raised on 2nd of every English calender month. The successive bills clearly indicate that the amounts claimed by the Petitioner is consistent with the stand taken by the Petitioner that the Respondent was liable to pay at the rate of Rs.1,82,000/- per months towards Hire Charges for the usage of Excavator for 260 hours in that month. It is noticed that whenever the Respondent had used the Excavator exceeding 260 hours, the Petitioner raised bill on pro-rata basis as can be discerned from bill dated 2/5/2007. Suffice it to observe that the case made out by the Petitioner that the Petitioner was entitled to claim amount of Rs.1,82,000/- per month for usage of 260 hours and on pro-rata basis for further usage beyond 260 hours is a plausible stand taken by the Petitioner. The amount of claim towards this head works out to Rs. 16,40,011/-, out of which Rs.4,00,000/- have already been paid by the Respondent on 1/7/2008. Giving adjustment of the said amount, the Respondent is liable to pay further amount of Rs.12,40,011/- to the Petitioner towards this head. 7. The argument of the Respondent, however, is that the stand now taken by the Petitioner is belied by the subsequent supplementary contract dated 23rd April, 2007 5 coupled with the fact that the Petitioner raised bill with regard to Rockbreaker Hire Charges for amount much less than the specified amount in the said communication dated 23rd April, 2007. In that letter, the amount mentioned is Rs.1200/- per hour, whereas the bill raised by the Petitioner was only at the rate of Rs. 500/- per hour. That, however, cannot be the basis to doubt the correctness of the stand taken by the Petitioner which is founded on the written agreement with regard to Backhoe Hydraulic Excavator Hire Charges dated 20/10/2006 at page-32. 8. In so far as Petitioner’s claim regarding food and accommodation charges is concerned, that is also founded on the agreement dated 20/10/2006 at page-32. The agreement records that the food and accommodation shall be provided by the Respondent for one operator and one helper for each machine free of cost at the Respondent’s camp. The Petitioner has raised bills towards this head in the sum of Rs. 24,500/-. However, the Petitioner is not able to substantiate the fact that the said amount was the agreed amount between the parties. There is nothing on record which would indicate that Respondent has admitted the said amount as reasonable expenditure incurred by the Petitioner, unlike the case of TDS Certificate issued by the Respondent acknowledging the liability to the extent of Rs. 16,36,282/-. The 6 argument of the Respondent that the said TDS Certificate was issued only as a provisional certificate on 20/6/2008 does not commend to me. There is nothing on record to suggest that said certificate was issued as provisional certificate as is contended across the bar. 9. Be that as it may, in so far as claim for outstanding amount towards Food and accommodation charges is concerned, in absence of clear acknowledgment of liability by the Respondent in that behalf, it is not possible to accept that claim. 10. That takes me to the next head of claim towards mobilisation charges. The Petitioner relies on Item No. 1 of the agreement dated 20/10/2006 which reads thus: " For less than 3 months hire both way charges at actual will be paid. You will bear one way charges for more than 3 months hiring. If we hire your excavator for 6 months or more both way charges will be to your account." 11. The argument of the Petitioner is that the Excavator was supplied to the Respondent to be utilised at Godra site, whereas the same was shifted by the Respondent at Thandla in M.P. When the contract was terminated, the Excavator was lying at Thandla at M.P. 7 from where the Petitioner was required to bring back the same. According to Petitioner, the expenses incurred by the Petitioner for transporting the Excavator from Thandla in M.P. to Godra was payable by the Respondent. However, prima-facie, I am in agreement with the stand taken by the Respondent that the Excavator was supplied to the Petitioner not only to be utilised at Godra site but for the project at Koyali Ratlam Pipeline project. The Excavator was taken to Thandla in M.P. to be used for the said project only. This argument is supported by the terms in the agreement dated 20/10/2006. If this argument is to be accepted, the Petitioner would not be entitled to claim amount towards mobilisation of Excavator in sum of Rs.90,400/-. 12. That takes me to the next claim of the Petitioner in the sum of Rs. 2,25,000/- towards Hire charges of Rockbreaker. That claim is founded on agreement dated 23/4/2007 which will have to be read with the offer given by the Petitioner on 23/3/2007 at pages 36 & 35 of the paperbook respectively. It is not in dispute that the Petitioner has raised bill consistent with the amounts specified in the communication dated 23/4/2007. As per the terms specified in the said communication, the Petitioner was entitled for Rs. 1200/- per hours usage of Rockbreaker machine, whereas the Petitioner has charged the Respondent at the rate of Rs.500/- per 8 month. The fact that Rockbreaker machine was used for the numbers of hours claimed by the Petitioner is not in dispute. The fact that the Petitioner has charged for lesser amount than Rs. 1200/- per hours basis for the usage of Rockbreaker does not militate against the Petitioner. The claim of Rs.2,25,000/- towards Rockbreaker Hire charges, therefore, seems to be plausible and genuine claim of the Petitioner. The defence taken by the Respondent is unacceptable. 13. In so far as the next claim of the Petitioner towards tax component is concerned is in the sum of Rs. 7,09,457/-. However, having regard to the condition in the agreement that the rate would be inclusive of all statutory requirements of tax and insurance, it is not open to the Petitioner to set up claim towards tax component. Prima-facie the Respondent is justified in treating the rate as inclusive of taxes. That may apply to the first contract regarding Excavator and Rockbreaker tool is concerned. However, in so far as the contract towards wheel Loader dated 20/3/2007 is concerned, it is noticed that at the end of the said communication, the Petitioner has clearly inserted that the Petitioner is entitled for 4% CST. It is recorded that "4% CST will be payable extra". According to Respondent this is subsequently inserted by the Petitioner. However,this argument overlooks that the 9 original document is in the custody of Respondent. It is not the case of the Respondent that such noting is not made in the original document available with the Respondent. That document has not been produced before the Court. On the other hand, the claim of the Petitioner is reinforced from the communication sent by the Petitioner as back as on 8/3/2009 which clearly records that such insertion has been made in the Work Order. In other words, the Petitioner is entitled for claim of amount towards CST charges which I am informed across the bar is in the sum of Rs.69,000/-. 14. In so far as the Petitioner’s claim towards interest is concerned, it is fairly accepted by the Counsel for the Petitioner that there is no written agreement regarding liability of the Respondent to pay interest for delayed payment. However, according to Petitioner, inspite of repeated demands which clearly mentioned that if the amount was not paid as per the demand, the Respondent would be liable to pay interest. The Respondent has failed and neglected to pay the amount for which reason the Petitioner is entitled to claim interest. For the time being, I am not inclined to accept the argument of the Petitioner with regard to claim of interest. 15. Taking over all view of the matter, in my opinion, 10 the Petitioner has made out prima-facie case atleast with regard to claim of outstanding Excavator Hire Charges in the sum of Rs. 12,40,011/- and hire charges of Rockbreaker in the sum of Rs.2,25,000/- and CST charges Rs. 69,000/-. The aggregate amount payable to the Petitioner in this behalf is in the sum of Rs. 15,34,011/-. 16. The question is whether the Petition deserves to be admitted. As aforesaid, Petitioners have made out prima-facie case atleast to the above extent and in my view the Petition will have to be admitted. However, I propose to pass following order which would meet the ends of justice. It is made clear that the view recorded in this judgment is only a prima facie view to consider the question whether the petition deserves admission and is not an expression of a final opinion on merits. O R D E R R D E R R D E R 1) The Respondent shall deposit sum of Rs. 15,00,000/- (Rupees Fifteen Lakhs only) in this Court within eight weeks from today failing which the Petition shall stand admitted in which case it will be open to the Petitioner to issue publication regarding admission of the Petitioner within three 11 weeks thereafter. 2) In the event the Respondents deposits the amount of Rs. 15,00,000/- in this Court, it will be open to the Petitioner to institute Suit for recovery of outstanding dues as claimed in the present Petition and the amount so deposited by the Respondent shall be transferred to the Suit Account. The Suit, however, shall be filed within four weeks from the date of deposit made by the Respondent failing which it will be open to the Respondent to withdraw the amount deposited in this Court. 3) In the event, the Petitioner files Suit within four weeks from the date of intimation of deposit made by the Respondent , the Registry shall ensure that the amount deposited by the Respondent is transmitted to the Suit Account of the Suit filed by the Petitioner and which will be subject to the outcome of the said proceedings. 4) In the event, the Respondent deposits the above amount within time, the Petition shall stand dismissed without further reference to the Court. [A.M.KHANWILKAR,J.] [A.M.KHANWILKAR,J.] [A.M.KHANWILKAR,J.]