UNION OF INDIA Vs. AJIT MEHTA AND ASSOCIATES

JUDGEMENT

(1.) THESE five appeals arise out of the decision of the trial Court by which the trial Court has disposed of five suits and five objection petitions. Respondent No. 1 in all the appeals is a contracting firm (hereinafter referred to as the firm ). In First Appeal No. 21 of 1987 and First Appeal No. 25 of 1987 the firm is M/s. Ajit Mehta and Associates while in the rest of the appeals it is Ajit Construction Company. There are three partners in M/s. Ajit Mehta and Associates who are also the partners in M/s. Ajit Construction Company which has four partners. First Appeal No. 21 of 1987 is concerned with the contract for the construction of what is known as Married Accommodation at Jamnagar ; First Appeal No. 22 of 1987 is concerned with the contract of the construction of buildings at Dhrangadhra in Gujarat State; First Appeal No. 23 of 1987 is again concerned with the construction of the Married Accommodation at Dhrangadhra; First Appeal No. 24 of 1987 is concerned with the construction of Hospital Building at Jamnagar whereas First Appeal No. 25 of 1987 is concerned with another contract of construction of the Married Accommodation at Jamnagar. The tenders in all these contracts except in the contract in Appeal No. 22 of 1987 were invited and accepted by the Chief Engineer, Jaipur at Jaipur whereas the tender in contract involved in Appeal No. 22 of 1987 was invited and accepted by Commander Works Engineer, Baroda at Baroda.

(2.) THE contract in First Appeal No. 21 of 1987 was of 1979-80 and the work was completed within the extended period in February 1983. The final bill was submitted by the firm on March 26, 1983 and the firm was paid the amount due under the final bill on April 27, 1983. The firm made a request for release of the bank guarantee on April 28, 1983 and the bank guarantee was released on May 13, 1983. The contract in First Appeal No. 22 of 1987 was of 1977- 78 and the work was completed within the extended period by May 15, 1982. The final bill was submitted by the firm on July 16, 1982. The bill was not paid and the bank guarantee was also not released because there was an amount due from the firm under another contract and as per Condition 67 of the Contract between the parties, the appellant was entitled to withhold the said amount. In First Appeal No. 23 of 1987, the contract was of 1977-78 and the work was completed on February 26, 1981 within the extended period. The final bill was submitted by the firm on March 31, 1981 and it was paid on April 24, 1981. However the bank guarantee was not released as there were certain dues owed by the firm to the appellant under another contract. In First Appeal No. 24 of 1987 the contract was on 1978-79 and the work was completed within the extended period by October 15, 1982. The firm submitted its final bill on March 26, 1983. It was however paid on March 31, 1984 because the firm had not surrendered the excess stores laying with it till that date. The bank guarantee was released on May 18, 1984. In First Appeal No. 25 of 1987 the dates and facts are more in less identical with those in First Appeal No. 21 of 1987. The final bill was submitted by the firm by the end of March 1983 and it was paid on April 27, 1983. The bank guarantee was released on May 13, 1983.

(3.) AFTER the fresh claims were thus preferred in each of the contracts, both the concerned authorities, namely, the Garrison Engineer i. e. the Paying Authority and the Engineer-in-Chief, i. e. the Appointing Authority disputed the right of the firm to raise such claims when the final bill was submitted without any reservation and/or the payment under the said bill was received without any condition and in full and final settlement of the bill. They contended that the contract having come to an end as far as the firm was concerned, it had no right to raise such claims. In the correspondence that ensued between the parties, the firm did not dispute at any stage that the final bills were submitted without any reservation and/or the payment of the final bill was received in full final settlement and without any condition. However, the firm not only pursued the said claims but during the course of the correspondence, it also varied them, from the ones it had made initially. In Appeal No. 21 of 1987, the firm had first raised a fresh claim of Rs. 14,83,684. 45 which it increased in July 1984 by another amount of Rs. 2,05, 880/ -. In contract in First Appeal No. 22 of 1987, the firm had first raised a fresh claim of Rs. 25,40,600/- and it was stated that it was open to them to vary it before the arbitrator In contract in First Appeal No. 23 of 1987, the firm had first raised a fresh claim of Rs. 30, 97,815. 31 before the paying authority when it increased in July 1984 by another amount of Rs. 2,85,770/ -. However before the appointing authority the same claim was initially of Rs. 35,07,815. 31 which was raised in August 1984 by an amount of Rs. 2,85,770/ -. In contract in First Appeal No. 24 of 1987, the firm had first raised a fresh claim of Rs. 29. 04,240/- before the paying authority whereas before the appointing authority it made a claim of Rs. 48,65,665. 12. In First Appeal No. 25 of 1987, the firm had first raised a fresh claim of Rs. 10,12,461. 77 which it increased in July 1984 by another amount of Rs. 1,39,600/- before the paying authority. However before the appointing authority the claim remained to be of Rs. 10,12,461. 77 only.