M/S Ram Kripal Singh Construction ... vs Dav College Managing Committee & ...
2015 Latest Caselaw 2254 Del

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

+          CS(OS) 3804/2014 & IA No.24849/2014

                                                    Decided on : 17.03.2015

IN THE MATTER OF:
M/S RAM KRIPAL SINGH CONSTRUCTION PVT. LTD.          Plaintiff
                    Through : Mr. Rajesh Kumar, Advocate

                         versus

DAV COLLEGE MANAGING COMMITTEE & ORS.                      ..... Defendants
                  Through :

CORAM
HON'BLE MS.JUSTICE HIMA KOHLI

HIMA KOHLI, J.(Oral)

1.

The plaintiff has instituted the present suit against the

defendants/DAV College Managing Committee praying inter alia for

recovery of a sum of `41,75,625/- towards damages along with interest.

2. The case has been placed before the court by the learned Joint

Registrar who had recorded in the order dated 10.12.2014 that the suit

appears to be barred by limitation.

3. As per the averments made in the plaint, the plaintiff is in the

business of undertaking construction work for government departments

and other bodies and had participated in a pre-qualification tender for

construction of a building at Pehowa, Kurukshetra, Haryana, in terms of

an advertisement dated 13.1.2010 issued by the defendant No.1,

inviting bids. Upon the tender process being finalized, the work was

awarded in favour of the plaintiff on 16.6.2010. On 5.8.2010, an

agreement was executed between the plaintiff and the defendants. As

per the conditions stipulated in said agreement, the work was to be

completed by the plaintiff by 15.3.2011. The plaintiff has averred that

though they had arranged the entire resources at the construction site

for executing the work, the defendants had failed to make the drawings

available to its officers. The plaintiff claims that having failed to take

necessary steps in furtherance to the contract, the defendants had

breached their obligations under the said contract.

4. As per the plaintiff, though the first phase of the work at the site

was to be completed in less than one year, reckoned from 5.8.2010, the

date when the agreement was executed, the defendant No.2 had failed

to respond to the repeated requests made by it for being provided the

drawings of the construction required to be undertaken at the site. The

plaintiff has averred in the plaint that it had written a letter dated

28.9.2010 to the defendant No.2 for supplying the drawings, followed by

a letter dated 19.2.2011, asking for release of the mobilization expenses

incurred by it, but the defendants had not responded and finally, the

plaintiff was compelled to institute the present suit, for claiming recovery

of a sum of `41,75,625/-, on account of mobilization and de-mobilization

of resources, idle labour, bank charges and earnest money etc.

deposited with the defendants, as detailed in para 17 of the plaint.

5. It has been stated in para 20 of the plaint that the plaintiff had

waited for one and a half years in anticipation of payments to be made

by the defendants in terms of the invoice raised by it on 19.2.2011, but

since the defendants remained impervious, it had to issue a legal notice

dated 5.1.2013. The defendants did reply to the aforesaid legal notice on

22.8.2013, but they had denied their liability to pay any amount to the

plaintiff.

6. The records reveal that the present suit was instituted by the

plaintiff on 13.11.2014 whereas it had raised an invoice on the

defendants for expenses allegedly incurred by it under the contract, on

19.2.2011. In other words, by the time the present suit was instituted,

the period of three years prescribed under the Limitation Act had already

expired. In fact, the prescribed period of limitation would have expired

on 19.2.2014, whereas the suit has been instituted nine months

thereafter.

7. Counsel for the plaintiff insists that the suit is not barred by

limitation and seeks to refer to the reply dated 22.08.2013 sent by the

defendants to the plaintiff's legal notice and states that they had

admitted therein that the agreement in question had never been acted

upon. He submits that the date of the said admission should be taken

into consideration for calculating the limitation for purposes of instituting

the present suit.

8. The Limitation Act, 1963 prescribes a limitation of three years for

instituting a suit for compensation on account of breach of a contract

under Article 55 of the Schedule attached thereto and the said period of

three years has to be reckoned from the date when the contract was

broken or where there are successive breaches, when the breach in

respect of which the suit is instituted, occurs or where the breach is

continuing, when it ceases.

9. As per the averments made by the plaintiff in the cause of action

para, the cause of action had arisen in its favour and against the

defendants for the first time on 16.6.2010, when the plaintiff had

qualified for the work; it again arose on 5.8.2010, when the agreement

was executed between the plaintiff and the defendant No.1. The next

relevant date has been mentioned as 11.8.2010, when the plaintiff

states that it had written a letter to the defendants demanding various

documents from it and again on 28.9.2010, when the plaintiff had

demanded the drawings of the site plan from the defendant No.3.

10. It has been further stated by the plaintiff that the cause of action

once again arose in its favour on 18.2.2011, when it had raised an

invoice for a sum of Rs.41,75,625/- on the defendants in respect of the

expenses incurred on account of mobilization/demobilization of the

resources. The next relevant date mentioned is of 17.09.2011, when the

plaintiff had demanded payments from the defendants under the

contract and then on 05.01.2013, when the plaintiff had served a legal

notice upon the defendants demanding amounts which the defendants

had refused to pay vide their reply dated 22.8.2013.

11. It is apparent from a perusal of the cause of action para of the

plaint that in its letter dated 19.2.2011, the plaintiff had mentioned

having raised a final invoice of `41,75,625/- allegedly incurred by it

under the contract and it had called upon the defendants to pay the said

amount within ten days. On application of Article 55 of the Schedule

under the Limitation Act, the cause of action had clearly arisen in favour

of the plaintiff on 19.2.2011, when the final amount due and payable by

the defendants was quantified by it and the period of three years for

instituting the suit shall have to be computed from the said date. When

calculated in such a manner, the period of three years available in the

statute for instituting a suit for compensation on account of breach of

contract would have expired on 19.2.2014, whereas the present suit

came to be instituted by the plaintiff after almost nine months, on

13.11.2014.

12. Section 9 of the Limitation Act further prescribes that where once

time has begun to run, it continuous running and no subsequent

disability or inability to institute a suit or make an application, stops it.

In the present case, the cause of action had indisputably arisen on

19.2.2011, the date when the plaintiff had raised an invoice for the

disputed amount on the defendants and the period of three years for

instituting a suit for recovery, if reckoned from the said date, would have

continued running till it would have expired in due course, on 19.2.2014.

Merely because the plaintiff has chosen not to initiate legal action for a

period of one year thereafter and served a legal notice on the

defendants on 5.1.2013, would not be a ground to extend the period of

limitation for purposes of invoking its civil remedies against the

defendants.

13. As for the contention of the learned counsel for the plaintiff that in

their reply dated 22.8.2013, the defendants had acknowledged their

liability to make payments to the plaintiff, it may be noted that the said

submission is contrary to the plaintiff's own averments in the cause of

action para and are not even borne out from a perusal of the reply sent

by the defendants to the plaintiff's legal notice. There is nothing at all

that has been stated by the defendants in their reply that can be

construed as an admission on their part of their liability to pay any

amounts to the plaintiff on the basis of the invoice raised by it under

cover of letter dated 19.2.2011. Resultantly, a fresh period of limitation

cannot begin to run on the basis of the defendants' reply to the plaintiff's

legal notice. The statutory period of three years have to be computed

from 19.2.2011 and the said period would have expired on 19.2.2014,

whereas the present suit was instituted by the plaintiff on 13.11.2014,

which is far beyond the permissible period of three years.

14. As a result, the present suit is held to be barred by limitation and

is accordingly dismissed, along with the pending application.

                                                      (HIMA KOHLI)
MARCH 17, 2015                                           JUDGE
mk/rkb/sk