EXECUTIVE ENGINEER Vs. K SUBBA REDDY

JUDGEMENT

(1.) THE office has listed this M. F. A. for orders today, the reason being that the amount which is due to the respondent contractors legal heirs has not been deposited in the Bank within the period prescribed. To recall, the position was that a dispute had arisen between the Department and the contractor in respect of the work undertaken in the year 1985, as usually happens. That dispute ultimately went to arbitration. The arbitrator decided against the Department, after which the Department challenged the order before the City Civil Court and the court, in the year 1993, virtually confirmed the arbitration award. Thereafter, the Department, through the State of Karnataka, filed the present appeal, which proceeding was disposed of by us through our judgment dated 6. 3. 2002. It is pathetic but not unusual in this class of disputes that during this period of time, the respondent contractor had died and his wife and children were the claimants. The learned advocate, who represents them, almost with folded hands, pointed out to the court that even after the High Court judgment, recovering the amount from the Department is an exercise fraught with all sorts of problems and delays and, therefore, requested for consequential orders so that they would ultimately receive their dues. We, therefore, directed the Department which had partially succeeded in the appeal because, the principal amount was reduced substantially by this court, to quantify the amount due, and to deposit it in the ING Vysya Bank branch of the High Court as a F. D. for a period of 45 days and to inform the Registrar of this deposit upon which the Registrar was to instruct the Bank to release the amount to the claimants. The Department was given three months from 6. 3. 2003 to comply with this order. Today, on 22. 7. 2003, the office informs the Division Bench that the order has not been complied with and requests for appro-priate directions. The learned advocate, who represents the claimants submitted that his clients are so very hard pressed and in such distressing circumstances that every day and every week is hard on them and, therefore, requested the court to issue stringent directions so that there will be no further default.

(2.) THE learned Government Advocate submitted that he has verified the factual position and that there is unfortunately a communication gap. First of all, according to him, his office decided to obtain the certified copy, which was ready only in the month of June, and this certified copy was forwarded to the Department with a covering letter indicating that compliance has to be within three months. He states that, unfortunately, the office which was at a particular address had closed down and that, therefore, the non-compliance is inadvertent and he assured the court that within the next six weeks, the amount in question will be deposited in court.

(3.) TO say that we are unhappy with this state of affairs would be under statement. We do not want to give any scope for any further defaults and we consider that it is equally necessary that we devise a formula whereby the Department and the officers will consider it a distinct disincentive to disregard court orders as far as the observations of time deadlines are concerned. We make it very clear that six weeks will be strictly computed from today. A copy of this order to be made available to the learned Government Advocate forthwith and we also lay down that if the deadline is breached, that interest at the rate of 10% per annum for each day of default will start running on the aggregate amount due from the date on which the deadline expires. Undoubtedly, if the department complies, then, the penal interest will not be payable at all, but, if there is default, then the order will take effect and in order to make a disincentive for further defaults, we prescribe that it is necessary to step up the rate of interest which shall stand stepped up at the rate of 2% per annum for every month of default thereafter, we are laying down this formula to ensure that defaults do not take place, but, if the officers of the Department are callous enough to disregard court orders, that the opposite party will not be the sufferer.