Delhi Development Authority vs M/S. N.R.B.Associates And Ors.
2014 Latest Caselaw 6919 Del

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

                            RESERVED ON : 24th NOVEMBER, 2014
                            DECIDED ON : 17th DECEMBER, 2014

+                        CS (OS) 1672/2007

      DELHI DEVELOPMENT AUTHORITY                         ..... Plaintiff
                         Through :    Mr.Aakash Yadav, Advocate for
                                      Ms.Beenashaw N.Soni, Advocate.


                         VERSUS


      M/S. N.R.B.ASSOCIATES AND ORS.                      ..... Defendants
                         Through :    None.


       CORAM:
       HON'BLE MR. JUSTICE S.P.GARG

S.P.GARG, J.

1. The plaintiff - Delhi Development Authority has instituted

the instant suit for recovery of ` 32,62,401.90/- along with interest @

18% per annum from the date of institution of the suit.

2. As per the averments in the plaint, tenders were invited for

development of 1769.88 hectares of land and construction of peripheral

storm water drain in Sector 1 & 2, Pappankalan (Dwarka). The aforesaid

work was awarded to the defendants vide letter dated 28.09.1996 at an

estimated cost of ` 1,45,28,550/- and tendered amount of ` 1,46,60,760/-.

The date of commencement of work was stipulated as 08.10.1996 and that

of completion as 07.10.1997. An agreement was executed between the

plaintiff and defendant No.1 on 15.10.1996. Letters dated 28.09.1996 and

16.09.1996 were to form part of the said agreement. It is alleged that there

was inordinate delay in the performance of the work awarded to the

defendants. Vide a note dated 13.06.1997, the concerned Executive

Engineer submitted a proposal for termination of the contract and to

award the remaining work to some other contractor at the risk and cost of

the defendants. Decision was taken on 27.06.1997 to rescind the contract.

However, the defendants requested by their letter dated 03.07.1997 to

proceed with the work with utmost diligence. They promised to finish the

undone job at the earliest to the satisfaction of the plaintiff. However,

nothing material happened and by July, 1998, the defendants could

complete only 44% of the work. Again, the plaintiff was constrained to

issue letter dated 05.08.1998 whereby the contract was rescinded. On

getting representations from the defendants and their promise to complete

the entire work in time, the matter was reconsidered and it was decided to

revoke the rescission and to allow the defendants to carry on with the

work including construction of RCC Box Drain portion at the old

agreement rates. The date of start and stipulated date of completion were

fixed as 07.06.2001 and 06.06.2002 respectively. By December, 2002, the

defendants could complete only 73% of the work. On 12.07.2002, the

defendants expressed their inability to execute the RCC Box Drainwork at

old rates in violation of the terms and conditions of the agreement.

Finally, in a meeting held on 26.12.2002 it was decided to rescind the

contract and get the work done at their risk and cost. The plaintiff's

demanded compensation to the tune of ` 14,52,856/- in terms of clause 2

of the agreement from the defendants which they failed to pay.

3. Further case of the plaintiff is that fresh tenders were called

to complete the remaining work. With the approval of the Work Advisory

Board, the award was given to M/s. Sushil Kumar and Company vide

letter dated 08.10.2003 and an agreement was entered with him. It is

further stated that having finalized the 23rd and final bill for the aforesaid

work which was got executed from the new agency, the defendants were

called upon to deposit outstanding amount of ` 28,02,942.90/- being

provisional amount within ten days. The final payment which the

defendants were liable to pay was to the tune of ` 32,62,401.90/- which

was defendants failed to pay despite reminders. Hence, the present suit.

4. The defendants could not be served despite issuance of

various process. Finally, they were served by way of publication. By an

order dated 05.08.2013, the defendants were proceeded ex-parte. It

appears that subsequently appearance was put on behalf of the defendant

No.2 as reflected in the order-sheet dated 21.10.2013. None appeared

thereafter. The plaintiff examined PW-1 (Laxmi Narain) in its ex-parte

evidence.

5. I have heard the learned counsel for the plaintiff and have

examined the file. PW-1 (Laxmi Narain) has filed affidavit of evidence in

examination-in-chief (Ex.PW-1/A) and has proved the averments of the

plaint without any deviation. The plaintiff has also relied upon the

documents (Ex.PW-1/1 to Ex.PW-1/35). Ex.PW-1/1 is the tender

invitation dated 27.06.1996; Ex.PW-1/3 is the award letter dated

28.09.1996. Agreement executed between the parties dated 15.10.1996 is

Ex.PW-1/4. Letters (Ex.PW-1/6 and Ex.PW-1/7) dated 28.09.1996 and

16.09.1996 were to form part of the agreement. PW-1 (Laxmi Narain)

stated on oath that despite persuasions, repeated requests and issuance of

notice by DDA, the progress of work was very slow and far behind the

time schedule chalked out in the agreement. He further deposed that

decision was taken to rescind the contract on 27.06.1997. The defendants,

however, requested the plaintiff vide letters dated 03.07.1997 to proceed

with the work with utmost diligence. PW-1 (Laxmi Narain) further proved

on record various correspondences exchanged between the parties detailed

in para (7) of the affidavit collectively exhibited as Ex.PW-1/8. The re-

award letter dated 07.06.2001 is Ex.PW-1/13. When the defendants failed

to complete the work in time, they were asked to pay a compensation of `

14,52,856/-. The various correspondences are Ex.PW-1/15 to Ex.PW-

1/19. PW-1 (Laxmi Narain) further deposed that the plaintiff had no

option but to call for the tender for the balance work. An agreement was

executed with M/s. Sushil Kumar and Company at a cost of ` 96,09,719/-.

The various bills raised by them are Ex.PW-1/20 to Ex.PW-1/23. The

letter dated 12.03.2013 (Ex.PW-1/24) was issued for levy of

compensation. He further deposed that after finalizing the 23rd and final

bill, the defendants were called upon to deposit the outstanding amount `

28,02,942.90/-. The final liability of the defendants is ` 32,62,401.90/-

which amount was paid by the defendants to M/s. Sushil Kumar and

Company for the said work got executed from him at the risk and cost of

the defendants.

6. Statement of PW-1 (Laxmi Narain) has remained

unchallenged and unrebutted. Adverse inference is to be drawn against the

defendants for not appearing and contesting the suit.

7. From the uncontroverted testimony of PW-1 (Laxmi Narain),

it stands established that despite various opportunities given to the

defendants, they did not perform the terms and conditions of the contract.

The work awarded to the defendants was to be completed within a period

of twelve months. However, for no fault attributed to the plaintiff, the

defendants could not complete the project in time. Finally, the defendants

left the job and the work awarded to him remained unfinished. The

plaintiff company had to engage another agency M/s.Sushil Kumar and

Company to execute the remaining work and had to incur expenses to the

tune of ` 32,62,401.90/-. The defendants have not given any plausible

explanation for inordinate delay in the completion of the project. The

damages claimed by the plaintiff are actual expenses incurred in getting

the unfinished work done from another agency. The defendants are liable

for that on 'Cost of Cure' basis. These expenses were well in the

contemplation of the parties and cannot be termed remote damages.

Apparently, the defendants are liable to pay the amount incurred by the

plaintiff in getting the work completed from other agency.

8. In the light of above discussion, the suit filed by the plaintiff

is decreed in the sum of ` 32,62,401.90/- with costs. The plaintiff shall

also be entitled to interest @ 10% per annum from the date of filing of the

suit till the recovery of the decretal amount.

9. Decree-sheet be prepared accordingly.

10. The suit stands disposed of in the above terms.

11. Pending IA (if any) also stands disposed of.

(S.P.GARG) JUDGE DECEMBER 17, 2014 / tr