KUMAR AND COMPANY Vs. STATE OF HIMACHAL PRADESH

JUDGEMENT

(1.) The plaintiff is a registered partnership firm. The work of exploitation of forest and extraction of timber in respect of lot No. 2/82 -86 of Pangi Forest Division was allotted to the plaintiff in an open auction for Rs.75,01,000/ -. The necessary agreement (Ex.PW 2/A) came to be executed between the parties on 28.2.1982. The period allowed for the exploitation of the forest and extraction of timber was upto 31.3.1986. As per the terms contained in clause 10 of the conditions of sale Ex.PW 3/1, a sum of Rs. 7, 50,100/ - representing 10% of the total bid amount of Rs.75, 01,000/ - was deposited by the plaintiff with the defendants as security. The lot was duly worked out by the plaintiff within the stipulated period and it became entitled to the refund of the amount of security alongwith interest. However, inspite of repeated demands the defendants failed to repay the amount. The plaintiff has filed the present suit for recovery of Rs. 16,90,920/ - as detailed in paragraph 6 of the plaint, as under: - (i) Loss of interest of Rs. 3.75,000 for one year when the amount was not deposited in the Post Office Rs. 15,000 plus interest on it from 1.4.83 to 31.3.87 which works out to Rs. 2500/plus interest from 1.4.87 to 31.3.90 amounts to Rs.9.450/ - in all Rs. 26,950/ - Rs.26,950.00 (ii) Security amount of Rs. 7,50,100 with interest accrued upto 31.3.87 works out to Rs. 10,33,000 plus interest from 1.4.87 to 31.3.90 @ 18% per annum Rs. 5,57,820 - in all Rs. 15,90,820/ - Rs. 15,90,820.00 (iii) Wrongly recovered interest by the Government on Royalty and Sales Tax from the date of launching instead of 30th day of November, every year as per the terms of the A.D. and the provision of Sales Tax Act comes to Rs.47, 500/ -, plus interest which was lost on the sum of Rs.47, 500/ - wrongly recovered @ 18% p.a. from 1, 4.87 to 31.3.90 amounting to Rs.25, 650, inallRs.73, 150/ -. Rs.73,150.00 Total Rs. 16,90,920.00

(2.) The defendants, while resisting the suit, have admitted that lot No.2/82 -86 was allotted to the plaintiff being the highest bidder for Rs.75, 01,000/ -. Execution of the agreement Ex.PW 2/A was also admitted. They further admitted that a sum of Rs.7, 50,100/ - was deposited by the plaintiff as security amount. It was pleaded that during the working of the forest, on 17.8.1982 and 20.9.1982, fire had broken out in one of the forests of the lot due to the negligence of the labour of the plaintiff, due to which 20 Hects of area was effected causing serious loss to about 1285 standing trees of various species. Such loss has been assessed at Rs.5, 10,834/ - in terms of the proviso to clause 13 (b) of the agreement Ex.PW 2/A, which is recoverable from the plaintiff. It has further been pleaded that in addition to the damage caused to the standing trees, there has been damage to young re -generation and other forest flora. The site and soil conditions have got deteriorated resulting in the loss of fertility of the site which has adversely affected the future growth and increment of the surviving trees. Therefore, the whole of the security amount is liable to be forfeited for which a notice would be issued to the plaintiff and an opportunity of being heard would be afforded. An objection was further raised to the effect that claim Nos. (1) and (iii) as detailed in para 6 of the plaint are time barred.

(3.) On the pleadings of the parties, following issues were framed on 20.11.1991: -