Sh. Dev Dutt Sharma vs Municipal Corporation Of Delhi & ...
2011 Latest Caselaw 427 Del

         THE HIGH COURT OF DELHI AT NEW DELHI

%                    Judgment Pronounced on: 25.01.2011

+           CS(OS) No. 1503/2008

Sh. Dev Dutt Sharma                             .....Plaintiff

                            - versus -

Municipal Corporation of Delhi & Others         ....Defendants

Advocates who appeared in this case:
For the Plaintiff: Mr. Sandeep Sharma
For the Defendant: Mr. Anshum Jain for Ms. Suparna
                      Srivastava.
CORAM:-
HON'BLE MR JUSTICE V.K. JAIN

1. Whether Reporters of local papers may                  No.
   be allowed to see the judgment?

2. To be referred to the Reporter or not?                  No.

3. Whether the judgment should be reported                 No.
   in Digest?

V.K. JAIN, J. (ORAL)

1. This is a suit filed under Order XXXVII of the Code

of Civil Procedure for recovery of Rs.20,29,752/-. The suit

is based on the bills submitted by the plaintiff to the

defendant in respect of the work executed by him for the

defendant.

2. The plaintiff submitted a tender for providing RMC

from Mithapur Chowk to Village Hari Nagar on main Jaitpur

Road, which was accepted by the defendant vide acceptance

letter dated 31st March, 2005. The work order dated 18th

August, 2005 was issued to the plaintiff after deposit of

performance guarantee by the plaintiff. An agreement,

thereafter, was executed between the parties on 30 th

August, 2005. On completing the execution of the work, the

plaintiff submitted the first RA bill for Rs.11,53,978/-. A

sum of Rs.1,38,840/- was deducted from that bill and the

bill was passed for the balance amount of Rs.10,15,138/-

on 22nd September, 2005. However, the defendant failed to

make payment of the bill passed by it. Since the work was

completed on 8th August, 2005 and the defect liability period

was also expired on 7 th August, 2006, the plaintiff also

became entitled to refund of security deposit of Rs.94,456/-

made by him with the defendant. The plaintiff has also

claimed a sum of Rs.1982/-, which he claims to be payable

in respect of second and final bill. He has also claimed

Rs.16,930/-, which was recovered/deducted by the

defendant from the second and final bill. The plaintiff has

also claimed interest at the rate of 18% per annum on the

principal amount claimed by him.

3. I.A. 1324/2009 has been filed by the defendant

seeking leave to contest. It has been admitted in the

application that a sum of Rs.10,15,138/- was payable to the

plaintiff towards the first running account (RA) bill.

Regarding second RA bill, the defendant has admitted its

liable to pay a sum of Rs.1982/- to the plaintiff. However,

the defendant has justified the deduction ofRs.16,930/-

from the second RA and final bill.

4. Admittedly, the amount of Rs.10,15,138/-, which

was payable to the plaintiff against the first RA bill as also

the amount of Rs.1982/-, which was payable to him against

the second RA bill has been paid during the pendency of

this suit. As regards the amount of Rs.16,930/-, which was

deducted from the second RA bill, the learned counsel for

plaintiff does not press for recovery of this amount. Thus,

the claim of the plaintiff in respect of principal amount

stands satisfied.

5. Coming to interest part, the only plea taken by the

defendant is that in view of amendments made in Clauses 7,

9 and 9A of the General Conditions of Contract for

Municipal Corporation of Delhi Works, vide circular dated

19th May, 2006, which provided that payment of bill would

depend on availability of funds in particular head of account

from time to time in MCD and payment of bills shall be

made strictly on Queue basis i.e. first the past liabilities will

be cleared and release of payment for passed bills will be in

order of the demand received at the head quarter under

particular head of account, the amount payable to the

plaintiff could not be released due to non-availability of

funds from the Government of NCT of Delhi.

6. Admittedly, the tender of the plaintiff was accepted

on 31st March, 2005 and the work order was issued to him

on 18th August, 2005. Even the formal agreement between

the parties is alleged to have been executed on 30 th August,

2005. The agreement between the parties does not contain

the terms of payment, which were stipulated vide circular

issued by the MCD on 19th May, 2006 and this is not the

case of the defendant that the plaintiff had at any point of

time agreed to accept payment in terms of circular dated

19th May, 2006 issued by it. A unilateral amendment of the

General Conditions of Contract by the defendant will not

bind the plaintiff since it does not result into a concluded

contract between the parties. The defendant was not

entitled in law to amend the terms of payment, without the

plaintiff agreeing to the amended terms. Consequently, the

defendant cannot claim any justification for withholding the

payment, which was due to the plaintiff in respect of the

work executed by him for the defendant.

7. It has been alleged in the plaint and has also been

stated in the affidavit filed by the plaintiff for issue of

summons for judgment that a notice was issued by the

plaintiff to the defendant on 6th December, 2007, which was

duly served on the defendant. The receipt of notice has not

been disputed by the defendant in the application filed by it

for leave to contest the suit. Though the date of service of

the notice has not been given in the plaint, having been

dispatched on 7th December, 2007, the notice would in the

normal course have been served on the defendant by 9th

December, 2007. A perusal of the notice dated 6th

December, 2007 shows that the defendant was required to

make payment within two months from the date of receipt of

the notice along with interest at the rate of 18% per annum

from due date till the date of payment.

8. Section 3 of the Interest Act, 1978, to the extent it

is relevant, provides that in any proceedings for recovery of

any debt or damages or in any proceedings in which a claim

for interest in respect of any debt or damages already paid is

made, the court may, if it thinks fit, allow interest to the

person entitled to the debt or damages or to the person

making such claim, as the case may be, at a rate not

exceeding the current rate of interest, if the proceedings do

not relate to a debt payable by virtue of written instrument

at a certain time, from the date mentioned in this regard in

a written notice given by the person entitled or the person

making the claim to the person liable that interest will be

claimed, to the date of institution of the proceedings.

9. Since the notice dated 6th December, 2007

indicated that the defendant would be liable to pay interest

from due date, the plaintiff, in view of the aforesaid

provision contained in Section 3 of the Interest Act, 1978, is

entitled to interest from the date the principal amount was

payable to him by the defendant. In my view, considering

the nature of transaction between the parties, interest

should be awarded to the plaintiff, on the principal amount

at the rate of 10% per annum with effect from one month

after submission of the bill, after giving a reasonable time of

one month to the defendant to make payment. Calculating

at 10% per annum, the amount of interest, with effect from

8th September, 2005, which is one month after the date of

submission of the final bill, on the principal amount of

Rs.10,17,120/-, the date of filing of the suit, comes to Rs.2,

96,660/-. The amount of interest on the security deposit of

Rs.94,556/- calculated at the rate of 10% per annum for the

period from 7th August, 2006 till the date of filing of the suit

comes to Rs.18,911/-.

10. Coming to cost, the learned counsel for the plaintiff

prays only for award of Court Fee paid by the plaintiff.

11. Hence, a decree for recovery of Rs.3,15,571/- is

hereby passed in favour of the plaintiff and against the

defendant with cost quantified at the amount of Court fee.

If the defendant does not pay the aforesaid amount to the

plaintiff within 60 days from the date of this order, the

amount will carry pendente lite and future interest at the

rate of 12% per annum. Decree sheet be prepared

accordingly.

                                             (V.K. JAIN)
                                               JUDGE

January       25, 2011
vk