Gujarat High Court
Gujarat Water Supply And Sewerage Board vs Pashim Gujarat Vij Cop Ltd on 17 December, 2025
NEUTRAL CITATION
C/FA/2555/2005 JUDGMENT DATED: 17/12/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 2555 of 2005
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE DEVAN M. DESAI
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Approved for Reporting Yes No
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GUJARAT WATER SUPPLY AND SEWERAGE BOARD & ANR.
Versus
PASHIM GUJARAT VIJ COP LTD & ANR.
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Appearance:
MR KH BAXI(150) for the Appellant(s) No. 1,2
MS MAYA S DESAI(285) for the Defendant(s) No. 1
RULE SERVED for the Defendant(s) No. 2
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CORAM:HONOURABLE MR. JUSTICE DEVAN M. DESAI
Date : 17/12/2025
ORAL JUDGMENT
1. This appeal is preferred by the appellants - original defendants under Section 96 of the Code of Civil Procedure, 1908 (for short, hereinafter referred to as `the Code') challenging the judgment and decree dated 29.6.2005 (for short, `the impugned judgment') passed by the learned Principal Senior Civil Judge, Surendranagar in Special Civil Suit No.60 of 2001. Page 1 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025
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2. Heard learned advocate Mr. K. H. Baxi for the appellants and learned advocate Ms. Maya Desai for respondent No.1. Though served, none appeared for respondent No.2. Perused the record.
3. The facts in brief of the case are as under:
* The respondent No.1 herein - original plaintiff had filed a suit for recovery of Rs.12,22,548-98 Paisa from the present appellant Nos.1 and 2 - original defendant Nos.1 and 2 and present respondent No.2 - original defendant No.3. As per the case of the plaintiff, the defendant had undergone Surendranagar underground gutter project for which defendants demanded 375 KVA electric load for which an agreement was executed by defendants in favour of plaintiff. It is contended by plaintiffs that defendants agreed to pay minimum charges for the period of 2 years. As defendants did not Page 2 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined submit test report and did not pay the amount of deposit though informed, a notice dated 19.3.1998 was issued and defendants were asked to submit the report.
* As defendants failed to pay agreed minimum charges for the period of 1997-98, the suit came to be filed for recovery of Rs.9,02,017.07 Paisa towards connection of 375 KVA and R.20,351-91 Paisa towards connection of 130 KVA. The defendants upon service of summons appeared and filed Written Statement at Exhibits 12 and 22 respectively. On the basis of pleadings, issues were framed at Exhibit 23. Plaintiff examined Praveenchandra Himmatlal at Exhibit 41 and Lavjibhai Bhudarbhai Bagadia at Exhibit 75. Defendant Nos.1 and 2 examined Surendrakumar Motilal, Assistant engineer at Exhibit 106. Defendant No.3 did not examine any witness.Page 3 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025
NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined * After considering the evidence, learned Court below decreed the suit and defendants were jointly and severally directed to pay an amount of Rs.12,22,548.98 Paisa to the plaintiff with interest at the rate of 9% per annum from the date of suit till realization.
* Being aggrieved and dissatisfied with the impugned judgment and decree, original defendant Nos.1 and 2 - present appellants have filed this appeal.
4. Learned advocate for the appellants, at the outset, contended that the defendant No.1 is an agent of defendant No.3 and as defendant No.3, was in need of electric load for the purpose of laying down underground sewage project, original defendant No.3 - Corporation applied for the power supply of 375 KVA with the plaintiff. The application Exhibit 50 establishes the aforesaid fact that the application was made by the Chief Officer, Surendranagar Municipality, Page 4 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined Surendranagar.
5. It is further contended that the defendant Nos.1 and 2 had never applied for any supply of electric load. It is contended that though the agreement Exhibits 42 and 43 for 375 KVA and 130 KVA were signed by defendant Nos.1 and 2, the contracting party is defendant No.3 and the conditions stipulated in the 2 agreements also contemplate that the consumer, namely; the Corporation, shall be liable to pay the amount of minimum guarantee as if the supply is actually commenced from the date of expiration of said notice of three months. It is further contended that both the agreements were signed by the defendant Nos.1 and 2 as agents of defendant No.3 and the terms and conditions stipulated in both the agreements cannot be made applicable to the defendant Nos.1 and 2.
6. It is further contended that the entire project was Page 5 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined budgeted by the Municipality. The defendant Nos.1 and 2 were only to execute the work entrusted by defendant No.3. After completion of the project, as per the provisions contained in the Gujarat Water Supply and Sewerage Board Act, 1978, the site was to be handed over to defendant No.3. The defendant Nos.1 and 2 are not the ultimate consumer. The ultimate consumer is defendant No.3. It is, therefore, contended that the learned trial Court has wrongly held defendant Nos.1 and 2 liable for the amount of minimum charges. No other submissions are made except the above.
7. Per contra, learned advocate for the plaintiff -
respondent No.1 herein has supported the judgment and decree and contended that all defendants have signed the agreements exhibit 42 and 43 and, therefore, terms and conditions stipulated in the agreements are binding to defendant Nos.1 and 2 also. Learned Advocate for the Plaintiff has taken this Court Page 6 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined through the Written Statement at exhibit 22 filed by the Municipality, wherein, it is contended that as per the order of defendant No.3, defendant Nos.1 and 2 were supposed to carry out the work of underground sewerage project. Defendant Nos.1 and 2 were entrusted the work and the work was to be undertaken under the supervision of defendant Nos.1 and 2. The sum and substance of the defense of defendant No.3 is that since the work was not completed by defendant Nos.1 and 2, defendant Nos.1 and 2 are solely liable for the amount claimed by plaintiff.
8. It is further contended by learned advocate for the respondent that the learned trial Court has considered the undisputed fact that bills were issued in the name of defendant No.3 but was given to defendant Nos.1 and 2. The defendant Nos.1 and 2 in their oral deposition have admitted that test report was supposed to be submitted by them as per agreements Page 7 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined Exhs.42 and 43. It also comes out on record that during the cross examination of witness of defendant Nos.1 and 2 that the test report was not submitted by defendant Nos.1 and 2. Notices Exhs.45 and 46 though were duly received by defendants were neither replied to nor acted upon by defendants. Therefore, as per the Agreements Exhibits 42 and 43, defendants have rightly been held liable for the minimum charges. No other submissions are made except the above.
9. I have considered the submissions canvassed by learned advocates for the parties and perused Record & Proceedings.
10. The question which is under consideration in the present appeal is whether the appellants-original defendant Nos.1 and 2 can be held liable for the breach of the terms and conditions of Agreements Exhibit 42 and 43, which is undisputedly signed by defendant Page 8 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined Nos.1 and 2 and not signed by defendant No.3.
11. The preamble of the Agreement indicates that the contracting parties are the plaintiff and defendant No.3, namely; Chief Officer, Surendranagar Municipality, Surendranagar. It is also an admitted fact coming out from perusal of Written Statement of defendants that defendant Nos.1 and 2 acted as an agent of defendant No.3 and the work of defendant No.3 under Surendranagar Underground Sewage Project, for which defendant No.3 applied with the plaintiff for the supply of electrical energy. Exhibit 50 is an application which undisputedly mentions the name of applicant as Chief Officer, Surendranagar Municipality Surendranagar. The application also stipulates that defendant No.3 agreed to take supply and pay for this energy, service connection and other dues, including the deposit of such security as to be demanded by the Plaintiff Board. Exhibits 42 and 43 Page 9 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined are the agreements executed between the plaintiff and defendant No.3 for supply of 375 KVA load and 130 KVA load respectively. The contention of the learned advocate for the appellants is mainly that though the agreements have been signed by defendant Nos.1 and 2, the contracting parties are plaintiff and defendant No.3, as defendant No.3 was the Principal who undertook the work of laying underground sewage. Defendant Nos.1 and 2 being an agent of defendant No.3 cannot be held liable for the minimum used charges as claimed by the plaintiff. Upon perusal of Exhibits 42 and 43, it is found that the plaintiff except the supply of electric load, all other terms and conditions are same. Therefore, for the purpose of convenience, condition No.2(b) of Exhibit 42 is reproduced hereunder for the sake of convenience:
"2(b) If the supplier is ready to commence supply save in respect of any work or works remaining to be done on the consumer's premises due to non-completion of suitable accommodation and / or in complete work of the consumer to receive supply the consumer shall be liable to pay the amount of minimum guarantee as hereinafter provided as if the supply is actually commenced from the Page 10 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined date of expiration of said notice of three months unless the General Manager (Comm.) has granted any extension of time as provided in sub-clasue (a) above."
* The aforesaid clause binds defendant No.3 that the consumer namely defendant No.3 shall be liable to pay the amount of minimum guarantee charges. Under the head of charges for supply at page No.4 of Exhibit 42, the defendant No.3 has agreed to pay to the supplier every month which includes minimum charges mentioned in the Supplier's Tariff Schedule. On scrutinizing the entire evidence, the execution of agreements Exhibits 42 and 43 are not in dispute.
12. The only dispute is with regard to whether defendants jointly and severally can be held liable for the demand of minimum charges. If the case of defendants is perused, defendant Nos.1 and 2 have projected themselves as an agent of defendant No.3. Though defendant No.3 has not stepped into the witness box, the burden of payment of minimum charges has been Page 11 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined thrown upon defendant Nos.1 and 2 as defendant Nos.1 and 2 were entrusted the work of laying down underground sewage. For non-compliance of the work, defendant No. 3 has tried to escape from the liability of payment of minimum charges to the plaintiff. The application for supply of electric load was undisputedly applied by defendant No.3 and defendant No.3 is termed as a consumer as mentioned in the preamble of agreements.
13. At this stage, relevant provisions as contemplated under the Indian Contract Act, 1872 are required to be considered. Section 211 of the Act deals with agent's duty in conducting principal's business. Section 211 of the Act is reproduced hereunder:
"211. Agent's duty in conducting principal's business.--
An agent is bound to conduct the business of his principal according to the directions given by the principal, or, in the absence of any such directions, according to the custom which prevails in doing business of the same kind at the place where the agent conducts such business. When the agent acts otherwise, if any Page 12 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined loss be sustained, he must make it good to his principal, and if any profit accrues, he must account for it."
* The aforesaid provision contemplates that the agent is bound to conduct the business of his principal according to the directions given by the principal and when the agent acts otherwise, if any loss is sustained, the agent must make it good to his principal. Similarly, if any profit accrues out of the acts done by agent, he must account for it to the principal.
14. In the present case, as evident from the record that the test report was to be submitted by defendant Nos.1 and 2 and the same, admittedly, were not supplied by defendant Nos.1 and 2 though demanded by plaintiff. It is not the case of the defendant Nos.1 and 2 that the work which was entrusted by the principal-defendant No. 3 was successfully concluded. Since the evidence does not indicate with regard to the completion of Page 13 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined project, it can be presumed that the work remained incomplete for one reason or the other. Agreements, in the present case, in clear terms make the consumer liable to pay minimum charges and when such minimum charges are not paid by the consumer, defendant No.3 - the consumer is liable for payment of such amount. Similarly, defendant Nos.1 and 2 being the agent of defendant No.3 and being the signatory of the agreements, equally cannot escape from the liability of payment of minimum charges. The Contract Act deals with agent's duty to principal as well as principal's duty to agent. Section 222 of the Indian Contract Act, 1872 deals with indemnification of agent against consequences of lawful acts. Section 222 of the Act is reproduced hereunder:
"222. Agent to be indemnified against consequences of lawful acts.--
The employer of an agent is bound to indemnify him against the consequences of all lawful acts done by such agent in exercise of the authority conferred upon him."Page 14 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025
NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined * The aforesaid provision mandates that the agent is bound to be indemnified by the principal against the consequences of all lawful acts in exercise of the authority conferred upon him.
15. Learned trial Court after appreciating the evidence found that all defendants are jointly and severally liable to pay the amount of minimum charges as demanded by plaintiff. During the course of submissions, I have been informed that defendant No.3 has not assailed the impugned judgment and decree and, therefore, the impugned judgment and decree has attained finality qua defendant No.3.
16. Learned advocate for the appellant could not point out any proposition of law on the question that the terms and conditions of the agreements are not binding merely on signing the agreements. In my view, a person who signs a contract is legally bound by the Page 15 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined terms and conditions of the contract. Such party is legally responsible for fulfilling the terms and conditions outlined in the contract. In the present case, defendant Nos.1 and 2 have asserted that defendant No.3 appointed them as agent and defendant No.3 also affirms that defendant Nos.1 and 2 were the agent. It is not the case of defendant Nos.1 and 2 that the agreements were signed under misrepresentation or the agreements were executed by practiced upon fraud. Since both the agreements are legally and validly executed, defendant Nos.1 and 2 cannot escape their liability to pay any amount for the breach of any terms and conditions of agreements.
17. Learned Advocate for the appellant has further submitted that the decreetal amount has been deposited by the appellant before the learned trial Court. A decree of jointly and severely liable to pay means more than one defendants are responsible for Page 16 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025 NEUTRAL CITATION C/FA/2555/2005 JUDGMENT DATED: 17/12/2025 undefined the entire decreetal amount. The judgment holder is permitted to recover the entire decreetal amount from any of the judgment debtor or from all of them together. Even if one of the judgment debtor cannot pay, while paying party can then seek reimbursement from other judgment debtors for their share. The judgment debtor who has paid more than its share, can then claim reimbursement for the portion by way of filing execution against the other judgment debtor. Therefore, appellant may recover the amount paid more than its share from original defendant No.3 if permissible under law.
18. In the aforesaid facts and in absence of any contrary evidence as well as in absence of any provisions of law, I do not find any reason to interfere in the findings arrived at by learned trial Court. Resultantly, the appeal lacks merit and it deserves to be dismissed and accordingly it is dismissed.
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19. Record & Proceedings, if any, be sent back to the concerned Court forthwith. Interim Relief, if any, stands vacated forthwith. No order as to costs.
(D. M. DESAI,J) VATSAL Page 18 of 18 Uploaded by VATSAL S. KOTECHA(HC00352) on Tue Dec 23 2025 Downloaded on : Wed Dec 24 20:31:08 IST 2025