SURJIT SINGH ATWAL Vs. UNION OF INDIA

JUDGEMENT

(1.) This is a contractor's suit for recovery of the sum of Rs. 50,000/- with lute-rest. There is a prayer for accounts if necessary. It is alleged in the plaint that the contractor was employed by the C. P. W. D., for construction of a hard-runway, taxi tracks and three dispersal roads. As is usual in the case of Government contracts there was an invitation to tender pursuant to which the plaintiff submitted a tender. This tender of the plaintiff was not accepted. It is the plaintiffs case that subsequently the plaintiff was urged to take up the contract on terms and conditions contained in two letters passed between the parties in January 1943. Copies of these letters are annexed to , the plaint. The formal contract was signed by the parties much later in February, 1944. This formal contract was introduced in the plaint by an amendment effected in December, 1955. The case made in paragraph 1 of the amended plaint is that the formal contract in the instant case was subject to the terms contained in a contemporaneous letter dated 28/29th February 1944. The original case in the plaint to the effect that the terms were recorded in the two letters dated January, 1943 was however retained. The work was completed in 1945. In the middle of November, 1947 it was agreed that the final bill to be prepared on the basis of rates settled would be payable immediately save and except the sum of Rs. 50,000/- the payment of which would be withheld for a fortnight from the date of the payment of the final bill. In terms of the agreement a final bill was prepared by the Executive Engineer and was paid on November 22, 1947 except Rs. 50,000/- withheld in terms of the agreement. It is the plaintiff's case that on such acceptance of the final bill there was a final and concluded contract between the parties. The money withheld not having been paid as agreed to, the instant suit has been instituted. It is pleaded in paragraph 10 of the plaint that notice under Section 86 of the Civil Procedure Code had been duly served. In paragraph 11 leave is reserved to institute suits in respect to the other claims of the plaintiff. Paragraph 12 of the plaint reads as follows: "As part of the cause of action as pleaded in paragraph 5 hereof arose within the said jurisdiction the plaintiff has been advised to ask for leave under Clause 12 of the Letters Patent."

(2.) The suit was filed on 24th January, 1951. The Union of India on being served with the summons, made an application under Section 34 of the Indian Arbitration Act for stay of the suit. The stay was granted but subsequently on August 23, 1954 the stay order was vacated and the suit was directed to proceed. Thereafter the defendant filed its written statement. It is contended in the written statement that the terms and conditions of the contract will appear in the formal agreement; bearing No. AVT 11/196 of 1943-44. This formal contract was not subject to the conditions contained in the letter dated 28/29th February, 1944. It is further pleaded that from time to time during the continuance of the work payments have been made to the plaintiff on running bills. The total payment alleged to have been made to the plaintiff from time to time on the said running bills came up to Rs. 25,45,298/~. The Government's case is that the payments made to the contractor were all 'on account bills'. When final accounts were prepared it was found that the contractor has been overpaid to the extent of Rs. 2,61,054/-. Further, the contractor was also found liable to pay a sum of Rs. 1,48,109/- as and "by way of recovery for services rendered and materials supplied. Allegations made in paragraphs 5 and 6 of the plaint have been denied. It is denied that the bill prepared by the Executive Engineer, as pleaded in paragraph 6 was a 'final bill' or that there was a concluded contract or that the sum of Rs. 50,000/- was withheld in terms of the said contract. The plaintiff's claim is disputed in toto. "The validity of the notice under Section 80 of the Code of Civil Procedure has been challenged. It is contended that this Court has no jurisdiction to, entertain this suit.

(3.) I have stated, that after the stay order, was vacated in 1954 and the suit was directed to proceed, the plaint was amended. The formal contract dated Febraury 1944 was introduced in the amended plaint and it was pleaded that the works were done thereunder. A further paragraph, was added being paragraph 8(a) to make an alternate case under Section 70 of the Indian Contract Act. In the written statement filed the alternate case, has also been disputed. During the trial an application was made for amending the written statement to raise a plea that the contract in suit is hit by the provision of Section 175 (3) of the Government of India Act. This was not expressly pleaded in the written statement filed. I dismissed the application for amendment on the grounds stated in my order rejecting the application. In my view, the plea can be raised without amendment and the amendment was unnecessary in consequence.