Kerala High Court
State Of Kerala vs K.T.Kuriakose on 17 October, 2024
Author: Sathish Ninan
Bench: Sathish Ninan
RFA No. 219 of 2021 & CO 52/2022 :1:
2024:KER:76861
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE SATHISH NINAN
&
THE HONOURABLE MR. JUSTICE JOHNSON JOHN
THURSDAY, THE 17TH DAY OF OCTOBER 2024 / 25TH ASWINA, 1946
RFA NO. 219 OF 2021
JUDGMENT DATED 26.02.2020 IN OS NO.25 OF 2009 OF SUB COURT,
KOTTARAKKARA
APPELLANTS/DEFENDANTS:
1 STATE OF KERALA,
REPRESENTED BY CHIEF SECRETARY, SECRETARIAT,
THIRUVANANTHAPURAM -695 001.
2 SUPERINTENDING ENGINEER,
KALLADA IRRIGATION PROJECT, R.B. CIRCLE, KOTTARAKARA,
PIN: 691 531.
3 EXECUTIVE ENGINEER,
KIP DIVISION, KOLLAM (PRIOR EXECUTIVE ENGINEER, KIP, R.B.
DIVISION NO.1, PUNALUR),
[THE ABOVE OFFICE ABOLISHED AND CHARGES IS GIVEN TO THE
PRESENT ADDRESS, PINCODE-691 002.]
4 EXECUTIVE ENGINEER,
KIP, R.B. DIVISION, NO.II, KOTTARAKARA, PINCODE-691 531.
BY SRI. V.K. SUNIL, SR. GOVERNMENT PLEADER
SRI. M. RAJEEV, GOVERNMENT PLEADER
RESPONDENT/PLAINTIFF:
K.T.KURIAKOSE,
S/O.LATE THOMAS, RESIDING AT KARUTHEDATHU HOUSE,
THIRUVANIYOOR, PINCODE-682 308.
RFA No. 219 of 2021 & CO 52/2022 :2:
2024:KER:76861
BY ADVS.
JOHN VARGHESE
SONU AUGUSTINE
THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 04.10.2024,
ALONG WITH CO.52 OF 2022, THE COURT ON 17.10.2024. DELIVERED THE
FOLLOWING:
RFA No. 219 of 2021 & CO 52/2022 :3:
2024:KER:76861
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE SATHISH NINAN
&
THE HONOURABLE MR. JUSTICE JOHNSON JOHN
THURSDAY, THE 17TH DAY OF OCTOBER 2024 / 25TH ASWINA, 1946
CO NO. 52 OF 2022
JUDGMENT DATED 26.02.2020 IN OS NO.25 OF 2009 OF SUB COURT,
KOTTARAKKARA
CROSS OBJECTOR/RESPONDENT IN R.F.A./PLAINTIFF IN O.S:
K.T.KURIAKOSE
AGED 84 YEARS
S/O. LATE THOMAS, RESIDING AT KARUTHEDATHU HOUSE,
THIRUVANIYOOR-682 308
BY ADVS.
JOHN VARGHESE
SONU AUGUSTINE
RESPONDENTS/APPELLANTS IN R.F.A/DEFENDANTS IN O.S:
1 STATE OF KERALA
REPRESENTED BY THE CHIEF SECRETARY, GOVERNMENT OF KERALA,
GOVERNMENT SECRETARIAT, THIRUVNANTHAPURAM-695 001
2 SUPERINTENDING ENGINEER,
KALLADA IRRIGATION PROJECT, R.B.CIRCLE, KOTTARAKARA-691 531
3 EXECUTIVE ENGINEER,
KIP DIVISION, KOLLAM-691 002 (PRIOR EXECUTIVE ENGINEER, KIP,
R.B.DIVISION, NO.1, PUNALUR),
[THE ABOVE OFFICE ABOLISHED AND CHARGES IS GIVEN TO THE
PRESENT ADDRESS]
RFA No. 219 of 2021 & CO 52/2022 :4:
2024:KER:76861
4 EXECUTIVE ENGINEER,
KIP, R.B.DIVISION, NO.II, KOTTARAKKARA-691 531
BY ADV. SRI. V.K. SUNIL, SR. GOVERNMENT PLEADER
SRI. M. RAJEEV, GOVERNMENT PLEADER
THIS CROSS OBJECTION/CROSS APPEAL HAVING BEEN FINALLY HEARD ON
04.10.2024, ALONG WITH RFA.219/2021, THE COURT ON 17.10.2024 DELIVERED THE
FOLLOWING:
RFA No. 219 of 2021 & CO 52/2022 :5:
2024:KER:76861
SATHISH NINAN & JOHNSON JOHN, JJ.
----------------------------------------------------------------
R.F.A. No.219 of 2021 & Cross Objection No. 52 of 2022
------------------------------------------------------------------
Dated this the 17th day of October, 2024
JUDGMENT
JOHNSON JOHN, J
This appeal and Cross Objection are against the judgment and
decree dated 26.02.2020 in O.S. No. 25 of 2009 of the Sub Court,
Kottarakkara.
2. The Government of Kerala accepted the tender of the plaintiff, a
registered 'A' class contractor, and awarded various works under the
Kallada Irrigation Project after executing the following principal
agreements:
"I. K1 & TCDP RBC Formation of Karunagappally branch canal from ch
20m to 2360 m including CD works - Agreement No.
18/5E/KCQ/1986-'87 of SE, KIP Circle, Quilon.
II.KI & TCDP RBC Formation of Vallikunnam distributory from ch.40 m
to 2000 m inducing CD works - Agreement No. 4/SE/KCQ/1987-'88 of
SE, KIP Circle, Quilon.
III. KI & TCDP LBC Formation of Mellila west distributory from ch
12000 to 14005 m, Flood damages work -Urgent rectification works
2024:KER:76861
between ch 13675 to 13805m -Agreement No.11/SE/KIP/LB/9394 of SE,
KIP LB Circle, Kottarakkara."
3. The estimate of Karunagappally Branch Canal work was
Rs.63,68,552/- and the accepted PAC of Vallikunnam Distributory Work
was Rs. 58,06,685/-. The time fixed for completion of the work was 14
months. But, during the progress of the work, there were alterations and
changes, and supplemental agreements were executed for extension of
time and thereby, the period for completion of the work was extended
upto 31.03.1995. But, the second defendant--Superintending Engineer,
by his proceedings dated 11.11.1994, foreclosed the work relating to
Karunagappally Branch canal and Vallikunnam Distributory and directed
the plaintiff to stop the work. The work executed by the plaintiff till
foreclosure was measured and the final bill recorded during February,
1995. The measurements were taken in accordance with the terms of
the contract and the total amount of the bills worked out to
Rs.23,61,558.81 and the said amount is due and payable to the plaintiff.
The plaintiff is entitled for price adjustment towards labour and materials
and a sum of Rs.57,73,838/- is due to the plaintiff from the defendants
2024:KER:76861
under clause 32A of the contract. The defendants are also liable to pay
interest at the rate of 12% per annum for the said amounts.
4. It is stated that the foreclosure was only a camouflage to avoid
the contract conditions between the parties and the defendants wanted
the plaintiff to continue and complete the work without LCB conditions
and arbitration clauses. Since the plaintiff invested heavily in the
contract and large amounts are due from the Department, he agreed to
execute and complete the balance work by 31.08.1995. The amount due
to the plaintiff under the final bill relating to Vallikunnam Distributory is
Rs. 22,98,956/- and out of that, the defendants paid only Rs.10,98,096.
Towards the cost of extra items of work, the plaintiff also claimed Rs.
11,78,128/- from the defendants.
5. The Melila West distributory work was completed on
30.06.1996. The plaintiff received the final bill of the above work under
protest. It is stated that more than Rs.85,673.25 is due to the plaintiff
for that work and that the defendants have charged penal rates illegally.
The plaintiff also claimed interest for the delayed payment. When the
defendants failed to make the payments as per the final bills, the
2024:KER:76861
plaintiff filed O.P. No. 18497 of 1999 and this Court directed the
defendants to make payment of the admitted bills within 4 months.
When the defendants failed to comply the directions, the plaintiff
initiated contempt of court proceedings and in the said proceedings, this
Court allowed the plaintiff to raise the disputed claims before the civil
court on or before 27.01.2009.
6. In the written statement and counter claim, the defendants
contended that the work was foreclosed on 11.11.1994. It is stated that
the original agreement was executed on 19.03.1987 and the period for
completion of the work was extended several times and in spite of that,
the plaintiff could not complete the work. The Government decided to
foreclose all agreements with LCB condition, when the World Bank
stopped its aid to the work and the plaintiff prolonged the work for more
than 7 years after the execution of the principal agreement. As per the
terms in the foreclosure agreement, the plaintiff is not entitled to raise
any claim on account of the principal agreement dated 19.03.1987. It is
stated that no amount is due to the plaintiff towards the final bill of the
foreclosed agreement and the claims put forward by the plaintiff are
fictitious and fabricated.
2024:KER:76861
7. The defendants also contended that supplementary agreement
No.8 to the original agreement was executed by the then Superintending
engineer after negotiation with the plaintiff. It is stated that the plaintiff
was allowed an amount of Rs.46,29,075/- against the estimate amount
of Rs.18,45,654/- and the same was above 150% of the estimated rate.
The Superintending Engineer has exceeded his powers without obtaining
the sanction of the Chief Engineer or Government and thereby, caused
huge pecuniary loss to the State.
8. The Vigilance and Anti Corruption Bureau has registered a
criminal case and the same is pending before the Enquiry Commission
and Special Judge, Thiruvananthapuram as C.C No. 40 of 2004, wherein
the plaintiff and Departmental Officers are the accused. All escalation
amounts as contemplated in the original agreement were paid to the
plaintiff and the claim now raised is bogus and ill-motivated.
9. It was on the request of the plaintiff, the balance work was
awarded to the plaintiff under PWD conditions of contract. The total bill
amount under CC 1 and 2 bills comes to Rs.22,12,982/-, including the
cost of departmental materials. After deducting the cost of departmental
materials and effecting all statutory recoveries, Rs.13,40,910/- was paid
to the plaintiff. After the acceptance of CC 2 part bill, the plaintiff has not
2024:KER:76861
executed any work. The third bill prepared after obtaining sanction for
the revised estimate by the Superintending Engineer was a minus bill
and the plaintiff is liable to return an amount of Rs.5,429/- with interest
at the rate of 18% to the defendants. As per the proceedings issued on
20.12.2005, the plaintiff was directed to return the said amount. But, so
far, the plaintiff has not returned that amount. The supplementary
agreements executed by the Departmental engineers regarding the
additional works were beyond their delegated financial powers.
10. The total amount paid to the plaintiff towards supplementary
agreement No.5, is Rs.27,94,609/-; whereas, the plaintiff is eligible only
for Rs.18,02,266.95 and therefore, there is an excess payment of Rs.
9,92,342.21. In this connection, the Vigilance and Anti Corruption
Bureau has registered a criminal case and the same was pending before
the Enquiry Commission and Special Judge, Thiruvananthapuram as C.C.
No. 23 of 2001 against the plaintiff and the Departmental Officers. The
plaintiff and the Departmental Officers were sentenced for imprisonment
for 3 years and to pay a fine of Rs. 3,00,000/- each.
11. The balance work was entrusted to the plaintiff at his request.
The plaintiff also failed to return the unused steel items purchased using
the departmental money and when the final bills were prepared after
2024:KER:76861
deducting those amounts, it became a minus bill, whereby the plaintiff is
liable to return Rs.92,368/- with interest to the defendants.
12. The defendants sought for realization of Rs.1,09,09,466/-
from the plaintiff as per the counter-claim. In the additional written
statement filed, the defendants also contended that the suit is time
barred and the plaintiff cannot overcome the period of limitation on the
basis of the judgment of this Court in the Contempt of Court case.
13. In the written statement to the counter-claim filed by the
plaintiff, it is contended that the counter-claim is time barred. The
plaintiff executed the supplementary work fully believing that the work is
sanctioned on additional rates. The plaintiff is not liable to return any
amount to the defendants. The plaintiff was compelled to execute the
balance work under threat of terminating the contract.
14. In the trial court, PWs 1 to 3 were examined and Exhibits A1
to A46 were marked from the side of the plaintiff. From the side of the
defendants, DW1 examined and Exhibits B1 to B16 were marked. The
report filed by the Chartered Accountant is marked as Exhibit C1.
2024:KER:76861
15. After considering the evidence on record and hearing both
sides, the trial court found that the suit is not barred by limitation, and
that the plaintiff is entitled to claim price escalation as per clause 32A of
the principal agreement, as the delay was not due to the fault of the
contractor. The trial court partly decreed the suit allowing the plaintiff to
realize Rs. 28,33,398/- with interest @ 6% per annum from the date of
suit till realization from the first defendant, State of Kerala, with cost and
dismissed the counter -claim.
16. The learned counsel for the appellant argued that the trial
court ought to have found that the plaintiff failed to complete the work
within the contractual period due to the fault of the plaintiff and that the
parties released each other from the obligations arising out of the
performance of the principal contract by executing the foreclosure
agreement. It is argued that the then Superintending Engineer executed
the supplementary agreement by allowing 150% above the estimated
rate which was impermissible as per the PWD Manual. It is argued that
the plaintiff has not filed any statement of accounts, whereas, the
2024:KER:76861
counter-claim was filed with detailed statement of accounts. The
Chartered Accountant calculated the amounts only on the basis of the
records produced by the plaintiff and the trial court erroneously
discarded the objections raised by the defendants against the report of
the Chartered Accountant.
17. The learned counsel for the respondent/plaintiff argued that
the finding of the trial court that the supplementary agreements were
executed on the basis of the rates existing at the time of execution of
the works is not sustainable. The trial court ought to have found that the
plaintiff is entitled for the claim under clause 31 of LCB conditions. It is
argued that as per Exhibit A44 judgment of this Court, interest is to be
paid @ 12% per annum. But, the trial court granted interest only @6%
per annum from the date of the suit till realization. The trial court also
erroneously rejected the claim of the plaintiff with respect to the cost of
departmental materials deducted by the Government in relation to
Vallikunnam Distributory work and Melila West Distributory work.
2024:KER:76861
18. The points that arise for determination are the following:
1. Is there any valid grounds to interfere with the finding of the
trial court that the suit is not barred by limitation?
2. Whether the finding of the trial court that the plaintiff is
entitled for price escalation with respect to the principal
agreements as per clause 32A, is legally sustainable?
3. Whether the finding of the trial court that the plaintiff is not
entitled for the claim under clause 31 of the LCB conditions with
respect to the principal agreements, is legally sustainable?
4. Is there any excess payment to the plaintiff?
5. Is there any valid grounds to interfere with the impugned
judgment and decree?
Point No.1:
19. The execution of the principal agreements with LCB conditions
is not disputed. Exhibit A1 is the certified copy of the file containing
principal agreement and supplemental agreements of Karunagappally
Branch canal work. The certified copy of the file containing the principal
agreement and supplemental agreements of Vallikunnam Distributory
work is marked as Exhibit A37. Exhibit A42 is the certified copy of the
file containing the principal agreement and supplemental agreements
regarding Melila West Distributory work. After the execution of the
2024:KER:76861
principal agreements regarding the Karunagappally and Vallikunnam
work, several supplemental agreements were executed for extension of
time and also for executing additional works and subsequently, the
works relating to Karunagappally branch canal and Vallikunnam
Distributory were foreclosed on 11.11.1994.
20. According to the plaintiff, even though the work executed till
the foreclosure was measured and the final bill also prepared during
1995, the admitted amounts due to the plaintiff were not paid and
accordingly, the plaintiff filed O.P No. 18497 of 1999 before this Court,
and this Court directed the defendants to make payment of the admitted
bills within four months. In spite of the direction of this Court, the
defendants failed to make the payment. The certified copy of the
judgment in O.P.(C) No. 18497 of 1999 is marked as Exhibit A44 and the
certified copy of the judgment in Contempt Case (C) No. 796 of 2004 of
this Court is marked as Exhibit A45.
21. A perusal of Exhibit A45 judgment shows that this Court, after
considering the last payment on 27.01.2006 and the pendency of the
2024:KER:76861
matter before this Court and before the Adalath, allowed the plaintiff to
raise the disputed claims in the civil court. This Court also observed that
if suit is filed on or before 27.01.2009, it should be disposed of on merit
and as both parties have agreed, the question of limitation will not be a
hurdle in contesting that matter.
22. In this connection, it is to be noted that in paragraph 2 of the
counter-claim, it is stated that on 20.12.2005, proceedings were issued
to the plaintiff to return Rs.5,429/- as per the third part bill. Admittedly,
the last payment was made by the defendants on 27.01.2006 and the
suit was filed on 22.01.2009. It is pertinent to note that the defendants
raised the plea of limitation only in the additional written statement after
the amendment of the plaint.
23. The Honourable Supreme Court in P.P. Abubacker v. Union
of India [AIR 1972 Kerala 103] observed as follows:
"...But it must be remembered that the State is no ordinary
party trying to win a case against one of its own citizens by hook or
by crook; for the State's interest is to meet honest claims, vindicate a
2024:KER:76861
substantial defence and never to score a technical point or overreach
a weaker party to avoid a just liability or secure an unfair advantage,
simply because legal devices provide such an opportunity. The State
is a virtuous litigant and looks with unconcern on immoral forensic
successes so that if on the merits the case is weak, government shows
a willingness to settle the dispute regardless of prestige and other
lesser motivations which move private parties to fight in court."
24. The Honourable Supreme Court in Madras Port Trust v.
Hymanshu International by its Proprietor, V. Venkatadri (dead)
by L.Rs [(1979) 4 SCC 176) observed thus:
"The plea of limitation based on this section is one which the court
always looks upon with disfavour and it is unfortunate that a public
authority like the Port Trust should, in all morality and justice, take up
such a plea to defeat a just claim of the citizen. It is high time that
governments and public authorities adopt the practice of not relying upon
technical pleas for the purpose of defeating legitimate claims of citizens
and do what is fair and just to the citizens. Of course, if a government or
a public authority takes up a technical plea, the Court has to decide it and
if the plea is well-founded, it has to be upheld by the court, but what we
feel is that such a plea should not ordinarily be taken up by a government
or a public authority, unless of course the claim is not well-founded and
by reason of delay in filing it, the evidence for the. purpose of resisting
such a claim has become unavailable."
2024:KER:76861
25. In this case, it is in evidence that after the execution of the
principal agreements, supplementary agreements were executed for
extension of time and also for execution of additional works and even
after foreclosure on 11.11.1994, the plaintiff and the defendants
executed agreements for completing the balance work without LCB
condition and the plaintiff also approached this Court to direct the
defendants to pay the admitted amounts as per the final bills prepared
for the work done till the foreclosure.
26. It is not disputed that the defendants issued proceedings
demanding Rs.5429/- from the plaintiff on 20.12.2005 and thereafter,
made the last payment on 27.01.2006 and therefore, considering the
above facts and circumstances, we find that the Government is not
justified in raising a technical plea of limitation and that there is no
reason to interfere with the finding of the trial court in this regard.
Point No.2:
27. As per the principal agreements, the work is to be completed
within 14 months. Clause 32A of the contract provides for price
2024:KER:76861
adjustment, when the work could not be completed within the
contractual period not due to the fault of the contractor.
28. The specific case of the plaintiff is that he could not complete
the work within the time fixed due to the fault of the defendants. It is in
evidence that after executing the principal agreements, additional works
were entrusted to the contractor and he was required to undertake the
additional works for completing the work as per the principal agreement
and that the defendants granted extension of time to the plaintiff for
completing the work as per the principal agreement without raising any
objection or imposing any penalty.
29. The proceedings and communications in connection with the
work would show that the plaintiff/contractor has also mentioned
adverse climate and shortage of materials in the Government store and
delay on the part of the defendants in removing electricity and telephone
poles as some of the other reasons for the delay in execution of the
work.
2024:KER:76861
30. Clause 50 of LCB conditions enables the contractor to apply
for extension of time, when delay was due to the fault of the
Government in supplying the materials or equipment or due to increase
in quantity of work or force majeure and in this case, admittedly the
plaintiff/contractor sought for extension of time invoking clause 50 of
LCB conditions and the defendants also granted extension of time
without any objection and without imposing any penalty.
31. In K.N. Sathyapalan v. State of Kerala (2007 (13) SCC
43), the Honourable Supreme Court held that even in the absence of any
price escalation clause in the original agreement and despite the
prohibitory clause in the supplemental agreement, the arbitrator was
well within his jurisdiction in allowing the contractor's claims on account
of escalation of costs under the said heads during the extended period.
Therefore, we find no reason to disagree with the finding of the trial
court that the plaintiff/contractor is entitled to get price escalation as per
clause 32A of LCB conditions with respect to the work covered by the
principal agreements.
2024:KER:76861
Point No.3
32. As per clause 31 of the LCB conditions, if the quantity of work
actually involved under any item be reduced by more than 30% of the
quantity provided in the tender, the bid unit price for the affected item
may be revised in accordance with the procedures indicated under "extra
items" keeping the total cost of such items within 70% of the item
quoted subject to adjustment in accordance with price adjustment
clauses.
33. The trial court rejected the claim of the plaintiff under clause
31 of the LCB conditions after recording a finding that the said provision
is intended to compensate the contractor in a situation where he
arranged men and machinery for large quantity of work and
subsequently, he was required only to execute a small quantity of work,
and in this case, it was not a single item of work; but several items of
work were entrusted to the contractor and therefore, he was in a
position to use the men and machinery for executing the other items of
work.
2024:KER:76861
34. In this case, it is in evidence that even though the principal
agreements relating to Karunagappally branch canal and Vallikunnam
Distributory were foreclosed by proceedings dated 11.11.1994, the
balance work was entrusted to the plaintiff as per the following
agreements:
I. KI & TCDP RBC Formation of Karunagappally branch canal from ch
20 m to 2360m including CD works (Balance works)-Agreement
No.2/SE/KIP/1995 of SE, KIP Circle, Kottarakkara.
II. KI & TCDP RBC Formation of Vallikkunnam distributory from ch
40 m to 2000 m including CD works (Balance Works)-Agreement No.
4/SE/KIP/1995 of SE, KIP Circle, Kottarakkara.
35. Therefore, it can be seen that the plaintiff has not suffered
any loss due to reduction in quantity of work and in that circumstance,
we find that the plaintiff is not entitled for the claim under clause 31 of
the LCB conditions with respect to the principal agreements.
Points 4 and 5:
36. The learned counsel for the respondent/plaintiff pointed out
that in Exhibit A44 judgment of this Court, there is specific direction to
2024:KER:76861
pay interest @12% for delayed payment. But the learned counsel for the
appellants pointed out that the said direction is regarding the admitted
bills and not applicable to the disputed amounts. In Exhibit A44
judgment of this Court, it is observed that if any particular amount is
disputed, the contractor can raise the dispute regarding that part
elsewhere and therefore, we find that on the basis of the direction in
Exhibit A44 judgment to pay interest @ 12% for the admitted bills, the
plaintiff/ contractor cannot claim interest @ 12% for the amount found
due after adjudication.
37. It is pertinent to note that there is no clause in the principal
agreements to pay interest for the delayed payment and therefore, we
find that the trial court is justified in awarding reasonable interest and
rejecting the claim of the plaintiff for interest on the strength of the
direction of this Court in Exhibit A44 judgment.
38. The learned counsel for the appellants/defendants argued that
the trial court has not considered the objections raised by the
defendants against Exhibit C1 report of the Chartered Accountant.
2024:KER:76861
Exhibits A11 to A15 and A17 to A28 and A36 are certified copies of the
measurement books. There is no dispute in this case regarding the
quantity of work executed and the measurements recorded in the
measurement books.
39. A perusal of Exhibit C1 report of the Chartered Accountant
would show that the calculations were made on the basis of the
measurements in the measurement books and the rate applicable as per
the terms in the agreements executed between the parties. The
defendants have not chosen to examine the Chartered Accountant as a
witness to establish any mistake or illegality in the calculation on the
basis of the measurement books. Therefore, we find no reason to
disagree with the observation of the trial court that the calculation made
by the Chartered Accountant on the basis of the measurements in the
measurement book is to be treated as without any objection.
40. The defendants have a case that there is excess payment to
the plaintiff/contractor and that the Government is entitled to recover
Rs.22,62,610/- from the plaintiff in connection with Karunagappally
2024:KER:76861
Branch canal work and Rs.9,92,342/- in connection with Vallikunnam
Distributory work. It is pertinent to note that the supplementary
agreements for extra items of work were executed after negotiation and
arriving at a negotiated rate on the basis of the PWD schedule of rates
applicable at the time of execution of the supplementary agreements.
41. Since the supplementary agreements for extra items of work
were executed several years after the execution of the principal
agreements, the Government is not justified in contending that the
schedule of rates applicable at the time of the execution of the principal
agreement is to be considered by ignoring the negotiated rate agreed by
the parties in the supplementary agreements. Therefore, we find that
the contention of the appellants in this regard is not legally sustainable.
42. As per the findings in the impugned judgment the amount
payable to the plaintiff in connection with Vallikkunnam Distributory work
is Rs.9,84,012.107. The learned counsel for the respondent/plaintiff
pointed out that Exhibit C1 report of the Chartered Accountant would
show that Rs.86,878/- was deducted as retention amount and that the
2024:KER:76861
contractor is also entitled for Rs.65,286/- towards 468 bags of cement
purchased and the trial court has omitted to add the same.
43. In this connection, we also notice that as per Exhibit C1 report
Rs.98,272/- is required to be deducted from the amount due to the
contractor towards unreturned departmental materials and the same is
not deducted by the trial court. Therefore, we find that the net amount
payable to the plaintiff in connection with Vallikunnam Distributory work
is Rs.10,37,904.11 (9,84,012.107 + 86,878 + 65,286 - 98,272). We
find no reason to interfere with the calculations in the impugned
judgment regarding the other amounts due to the plaintiff in connection
with the work (as shown at paragraph 50 of the trial court judgment)
and therefore, we find that the total amount due to the plaintiff is
Rs.28,87,190.36.
44. It is seen that the trial court allowed the plaintiff to realize
the entire cost of the suit from the first defendant. Even though the suit
claim was for Rs.2,58,25,434/-, the total amount found due to the
plaintiff is only Rs.28,87,190/-. In that circumstance, we find that the
2024:KER:76861
plaintiff is entitled to realize only the proportionate cost of the suit from
the first defendant.
45. In the result, the impugned judgment is modified allowing the
plaintiff to realize Rs.28,87,190/- with interest at the rate of 6% per
annum from the date of suit till realization with proportionate cost
throughout, from the first respondent-- State of Kerala and its assets.
The appeal and Cross Objection are disposed of as above.
Interlocutory applications, if any pending, shall stand closed.
sd/-
SATHISH NINAN,
JUDGE.
sd/-
JOHNSON JOHN,
JUDGE.
Rv
