[Cites 8, Cited by 0]
Kerala High Court
A.Ibrahimkutty vs The State Of Kerala & 3 Others on 19 February, 2026
Author: Sathish Ninan
Bench: Sathish Ninan
R.F.A.No.682/2010
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IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE SATHISH NINAN
&
THE HONOURABLE MR.JUSTICE P. KRISHNA KUMAR
THURSDAY, THE 19TH DAY OF FEBRUARY 2026 / 30TH MAGHA, 1947
RFA NO. 682 OF 2010
AGAINST THE JUDGMENT DATED 10.06.2010 IN OS NO.194 OF 2000 OF
ADDITIONAL SUB COURT,KOLLAM
APPELLANT/PLAINTIFF:
A.IBRAHIMKUTTY, GOVERNMENT CONTRACTOR
VALIYATH HOUSE, PUTHENCHANTHA P.O., CHAVARA,
KOLLAM-691587.
BY ADVS.
SRI.K.BABU THOMAS
SMT.MARYKUTTY BABU
RESPONDENTS/DEFENDANTS:
1 THE STATE OF KERALA , REPRESENTED BY THE
SECRETARY TO GOVERNMENT (IRRIGATION DEPARTMENT),
WATER RESOURCES DEPARTMENT,
SECRETARIAT, TRIVANDRUM.
2 THE CHIEF ENGINEER, IRRIGATION PROJECT III,
PULAMON P.O., KOTTARAKKARA, KOLLAM.
3 THE SUPERINTENDING ENGINEER
KIP CIRCLE, KOLLAM.
4 THE EXECUTIVE ENGINEER, KIP LB
DIVISION NO.VII, KOTTIYAM, KOLLAM.
BY SPECIAL GOVERNMENT PLEADER (IRRIGATION)
SRI.P.I.DAVIS
THIS REGULAR FIRST APPEAL HAVING COME UP FOR HEARING ON
17.02.2026, THE COURT ON 19.02.2026 DELIVERED THE FOLLOWING:
R.F.A.No.682/2010
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SATHISH NINAN & P. KRISHNA KUMAR, JJ.
= = = = = = = = = = = = = = = = = =
R.F.A.No.682 OF 2010
= = = = = = = = = = = = = = = = = =
Dated this the 19th day of February, 2026
JUDGMENT
P.Krishna Kumar, J.
The unsuccessful plaintiff in a suit for declaration and
recovery of money under a PWD works contract, is the
appellant. He challenges the impugned judgment by which the
reliefs sought by him were declined by the Sub Court.
2. For ease of reference, the parties are hereinafter
referred to as they were arrayed in the suit. The plaintiff
is an A-grade construction contractor to whom the work of
formation of a canal (KIP & TDCP LBC formation of Pallimon
distributory from Ch. 0 m to 7000 m, including CD works) was
awarded by the Public Works Department (PWD) pursuant to a
tender submitted on 21.02.1995. As per the letter of
acceptance dated 19.04.1995, he was informed that his tender
was accepted at (+) 35% above the estimated rate based on the
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1992 PWD Schedule of Rates. Accordingly, on 21.04.1995, he
executed an agreement with the third defendant, stipulating a
contract period of 18 months from the date of handing over
possession of the work site. Possession of the site was
handed over on the following day, i.e., 22.04.1995, and the
stipulated contract period was therefore to expire on
21.10.1996.
3. Briefly stated, the work involved earthwork
excavation for the formation of a canal and allied works. The
earthwork excavation was estimated at 2,00,650 cubic metres.
According to the plaintiff, commencement of the work was
delayed as the defendants took the initial levels for
excavation only on 01.11.1995. He further contended that the
defendants were bound to provide a dump yard for disposal of
surplus spoil obtained during excavation, as evidenced by
Ext.X2(a), pages 166 and 167. By Ext.A2 letter dated
03.11.1995, the plaintiff requested the defendants to provide
a dump yard at the earliest or, alternatively, to pay Rs.100
per cubic metre towards transportation of surplus spoil with
an average lead of 20 km from the site, as no disposal yard
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was available at a shorter distance.
4. Pursuant to Ext.A2, the plaintiff further contended
that the fourth defendant addressed the Special Tahsildar
(LA), Kottiyam, requesting acquisition of 20 acres of land
near the canal alignment for disposal of surplus spoil. The
Special Tahsildar reportedly intimated that acquisition would
require at least six months and would entail considerable
cost. The plaintiff alleges that the Chief Engineer and
subordinate officers thereafter inspected the site and the
dumping area suggested by him (with an average lead of 20 km
from the site, as stated in Ext.A2), and consequently
approved a rate of Rs.91.81 per cubic metre for conveyance of
the spoil (Ext.B7).
5. Meanwhile, the site was inspected by two Chief
Engineers, the Additional Secretary (Law Department), and the
Additional Secretary (Finance Department), along with other
senior PWD officials. They reportedly found that no land was
available for disposal of surplus spoil and recommended
payment of conveyance charges to the plaintiff. It is further
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alleged that the foundation of an aqueduct was set out and
measurements recorded on 06.03.1996, and that designs and
drawings were finalised introducing extra items, thereby
increasing the value of the work from Rs.4,76,63,804/- to
Rs.6,54,25,509/-. Although the contract period expired on
21.10.1996, the plaintiff was permitted to continue the work,
allegedly due to delays attributable to the defendants.
6. On 18.06.1997, the plaintiff addressed Ext.A17 letter
to the Minister for Irrigation and Labour, with copies to the
second and third defendants, stating that failure to provide
a dump yard had resulted in idling of men and machinery
deployed at the site, causing a loss of Rs.30,000/- per day
from April 1995 to November 1995. He further pointed out that
shortage of cement supply had also caused delays, resulting
in additional loss. On these grounds, he requested
enhancement of the agreement value by 40% (which would
effectively amount to 75% above the 1992 Schedule of Rates).
Alternatively, he sought to be relieved from his contractual
obligations upon payment of reasonable compensation for the
losses sustained.
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7. On 05.11.1997, the plaintiff submitted Ext.A19
representation to the Minister seeking payment of at least
75% of the conveyance charges. According to him, instead of
closing the agreement as requested in Ext.A17, the defendants
issued Ext.A26 letter dated 26.05.1999 threatening
termination of the contract. Thereafter, on 31.05.2000, the
plaintiff instituted the suit, principally seeking payment of
the unpaid value of the work already executed and recovery of
other outstanding amounts. He asserts that the value of work
carried out between 21.10.1996 and 01.07.1999 amounts to
Rs.4,23,55,521/-.
8. The plaintiff quantified the damages allegedly
suffered by him as follows:
a) Increased cost incurred for work executed beyond
21.10.1996 - Rs.1,75,74,616/-. He contends that the value of
work executed within the original agreement period was only
Rs.205 lakhs and, therefore, for the amount already paid to
him (Rs.4,23,55,521/-), he is entitled to an additional 50%
of the net value, which comes to Rs.3,51,49,232/-.
b) Increased cost of work executed beyond 27.03.1999 -
Rs.14,10,000/-, calculated at 117.5% over and above the
agreement rates, for work valued at Rs.12,00,000/-.
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c) Additional establishment charges beyond 21.10.1996 -
Rs.16,80,000/-, computed at Rs.40,000/- per month for 42
months beyond 21.10.1996.
d) Compensation for conveyance and disposal of surplus spoil
- Rs.3,05,71,536/-, calculated on the basis that for
excavation of 2,46,664 cubic metres (including bulkage), he
is entitled to Rs.91.81 per cubic metre, also applying the
revised schedule rate at Rs.123.94 per cubic metre.
e) Idling charges for men and machinery at site -
Rs.22,50,000/-, calculated at Rs.30,000/- per day for 175
days, though the claim is restricted to the above amount.
The total amount claimed is Rs.5,56,86,152/-.
9. The plaintiff also sought a declaration that the
undertakings/supplementary agreements executed by him for
extension of time were vitiated by undue influence, coercion,
and duress. He further prayed for a declaration that the
defendants had flagrantly violated the terms of the contract
and unlawfully prolonged the contract period beyond
21.10.1996, thereby rendering themselves liable to reimburse
the increased cost as reflected in the revised Schedule of
Rates of 1996 and 1999.
10. The defendants contended that the suit was not
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maintainable and that the claims raised in the plaint were
baseless. According to them, the contract period was extended
up to 31.10.1999 at the request of the plaintiff, who had
failed to execute the work within time due to his own
shortcomings. The work had not been completed even at the
time of filing the suit. The contract amount as per the
original agreement was Rs.3,72,80,974/-. The plaintiff had
thereafter requested extension of time up to 30.06.2001 for
completion of the work.
11. The department asserted that all materials,
including cement, were supplied promptly, and that 11 part
bills had been prepared and payments made in time. Despite
all facilities being extended by the department, the
plaintiff failed to complete the work within the stipulated
period. As per Clause 16 of the Special Conditions of Form
No.83, which formed part of the agreement, it was the
responsibility of the plaintiff to obtain land for stacking
excess cut earth. Therefore, the defendants had no obligation
to provide a dump yard. The PWD had provided lorry conveyance
up to 5 kilometres to transport earth to a dumping yard to be
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arranged by the plaintiff.
12. The plaintiff had informed the department that he
could acquire a dumping yard situated more than 20 kilometres
away, alleging scarcity of dumping sites along the canal
banks or within 5 kilometres. The Chief Engineer, Project III
(Kallada), inspected the canal site and discussed the matter
of conveyance. Upon receipt of a letter from the plaintiff,
the same was forwarded to the Tahsildar (LA), who reported
that land valued at Rs.3,000/- to Rs.5,000/- per cent was
available within a 5-kilometre radius. This, according to the
defendants, demonstrated that the contractor could have made
his own arrangements within the permissible distance.
13. Senior departmental officials inspected the site and
considered allowing conveyance up to 20 kilometres at
Rs.49.80 per cubic metre (after deducting the cost of earth
and minimum lorry conveyance for 5 kilometres), subject to
completion of the work within the stipulated period of
21.10.1996. However, the Government rejected the proposal. By
that time, the contractor had completed only 50% of the total
earthwork, and the shortfall was allegedly due to his
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negligence.
14. Thereafter, the agreement period was extended at the
plaintiff's request. The defendants contended that, having
executed supplementary agreements undertaking to carry out
the work at the agreed rates, the plaintiff was not entitled
to any additional amount. It was further argued that a
contractor is required to quote rates after studying the
specifications and site conditions at the time of tender
submission, and therefore the plaintiff cannot seek extra
payment on the ground of increased conveyance expenditure.
Moreover, the plaintiff had not disclosed the exact location
of his alleged dumping yard, making it impossible to verify
the actual distance or quantity of earth dumped there, which
was mandatory under the agreement.
15. During trial, the plaintiff examined himself as PW1
and marked Exts.A1 to A35. The defendants examined DW1 to DW6
and marked Exts.B1 to B37. In addition, Ext.C1 Commission
Report and Exts.X1 to X11 series were marked in evidence.
Upon conclusion of the trial, the learned Sub Judge found
that the plaintiff had failed to establish his case and
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consequently dismissed the suit.
16. We have heard Sri Babu Thomas K., learned counsel
for the appellant, and Sri P.I. Davis, Special Government
Pleader (Irrigation).
17. In view of the rival contentions, the following
points arise for consideration in this appeal:
1. Whether the plaintiff is entitled to
any compensation for conveyance and
disposal of surplus spoil?
2. Who is responsible for the delay in
execution of the work within the stipulated
period?
3. Whether the plaintiff is entitled to any
additional amount as compensation for the
work executed beyond the agreed period?
18. One of the principal disputes raised by the
plaintiff relates to the amount allegedly payable to him
towards conveyance and disposal of surplus spoil, on account
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of the defendants' failure to provide a dumping yard within 5
kilometres. The claim pertains to the expenditure allegedly
incurred by him in transporting the spoil from the work site
to three dumping yards identified by him, said to be situated
at an average distance of 20 kilometres from the site. The
plaintiff contends that, although the defendants were bound
to provide dumping yards, they failed to do so, compelling
him to locate alternative dumping sites and transport the
spoil thereto.
19. The plaintiff relied upon Clause 2 of the
Specification for the canal work under the Kallada Irrigation
Project and contended that the land required for the works to
be constructed under the contract, including necessary borrow
pits, channels, spoil banks, drains, etc., would be provided
by the Government. It was argued that only a limited quantity
of surplus spoil could be accommodated along the canal banks
and, therefore, in the absence of a dumping yard, the
contractor could not have proceeded with the work.
20. The defendants resisted the said claim, contending
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that it was the contractor's responsibility to arrange his
own dumping yard. Relying on Clause 16 of the Special
Conditions forming part of the agreement, it was argued that
the duty to secure land for stacking excess cut earth rested
with the contractor. Clause 16 reads as follows:
"16. It will be the responsibility of the contractor
to obtain necessary land for stacking the materials
for arranging the work."
The learned Government Pleader further submitted that the
quantity of excavated earth had to be measured strictly in
accordance with the agreement. According to him, the contract
provided for payment of conveyance charges only up to 5
kilometres, and the report of the Tahsildar (LA) indicated
availability of private lands suitable for dumping the spoil
within that radius. Therefore, the plaintiff could have made
arrangements accordingly. It was also contended that,
although the plaintiff claimed to have established dumping
yards 20 kilometres away from the work site, he did not
disclose the precise location of such dumping yards at any
point of time, except when he sought appointment of a
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Commissioner.
21. The first aspect that arises for determination is
whether the defendants were bound to provide dumping yards.
The appellant contends that Clause 2 of the Specification
obliges the Department to provide spoil banks, thereby
requiring it to make available the necessary dumping yards.
We are unable to accept this contention. "Spoil banks" refer
to places adjacent to the canal formation site where the
excavated soil is deposited. No specific clause imposing an
obligation upon the defendants to provide separate dumping
yards has been brought to our notice. Hence, we find no basis
to hold that the defendants were bound to provide dumping
yards.
22. However, that alone does not conclude the issue. It
is undisputed that the contract rates for excavation and
removal of spoil included conveyance charges only up to 5
kilometres. According to the plaintiff, since the defendants
were unable to provide dumping yards within that distance, he
was compelled to transport and dump the spoil at locations
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situated 20 kilometres away. In this context, a High-Level
Committee consisting of Government Secretaries, Chief
Engineers of the Department, the District Collector, and
other officials was constituted. After examining the matter,
the Committee submitted Ext.A5 report dated 20.06.1996.
23. The Committee noted that no land was available
within a 5-kilometre radius for use as a dumping yard and
that acquisition of land was the only option. As the
acquisition process would be both expensive and time-
consuming, the Chief Engineer recommended that the contractor
be directed to arrange his own dumping yard and proposed a
rate of Rs.49.80 per cubic metre (after deducting the value
of the spoil and the conveyance charges for 5 kms). Although
this recommendation was subsequently rejected by the
Government, the plaintiff contends that he is entitled to
compensation at least at the rate recommended by the Chief
Engineer.
24. Merely because Engineers or other senior officials
made such recommendations, in the absence of any contractual
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provision obligating the Government to arrange a dumping
yard, the plaintiff cannot stake a claim upon such
recommendations, especially when the recommendation is not
made according to the contractual terms. The plaintiff cannot
claim any additional amount for a work that falls within the
basic scope of the contract awarded to him. In the absence of
a specific stipulation to the contrary, it was necessarily
the obligation of the contractor to secure a suitable place
at his own cost. In this regard, the observations of the
trial court are apposite:
"As rightly contended by the learned government pleader,
spoil bank-drains is a separate work that is meant to catch
and resist water from entering into the canal. So there is
no basis or foundation for the plaintiff's case that the
defendants agreed to provide dumping yard for the excess
spoil. On the other hand, in Ext.B9 estimate report in
appendix L(a) canal formation it is specifically the
quantity of the earth that can be accommodated at site is
ascertained by calculating the area of spoil bank available
and provision for conveying the balance quantity to
contractors own dump yard outside is given. So in the
estimate itself it is provided that the excess spoil is to
be dumped in the contractors own dumping yard. In Ext.B1(n)
it is provided that the spoil will be deposited on the banks
or at places pointed out by the engineer in charge with all
leads and lifts. That means the conveyance is to be made by
the contractor himself.
Ext.B9 estimate report coupled with Ext.B12 circular of the
government makes it very clear that when the contract was
entered into between the plaintiff and 3rd defendant, the
intention of the government who is the owner of the work was
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to render the plaintiff responsible for taking the excess
spoil and dumping the same. It is true that the officers of
defendants 2 to 4 inspected the site and noted the absence
of acquired land for dumping yard for disposal of surplus
soil. It is equally true that a high level committee was
constituted and the committee recommended for acquiring land
for providing dump yard. But these act of the officers of
defendants 2 to 4 will not give any authority to the
plaintiff to claim that he is entitled to dump yard at the
instance of the defendants. The plaintiff failed to prove
that there is such a stipulation in the contract."
As certain trial court records, including those referred to
in the above observations, were reportedly missing from the
court, the significance of the above findings is further
accentuated. In any event, it can safely be concluded that
the contractor is not entitled to claim compensation based
solely on the recommendations of officials that were
ultimately rejected by the Government.
25. The learned Government Pleader raised an additional
contention that the contractor had sold the surplus spoil. It
was pointed out that the Chief Engineer fixed the conveyance
rate at Rs.49.80 per cubic metre after deducting the value of
the spoil, which implied that the spoil was at the
contractor's disposal. It was argued that, if the contractor
had sold the spoil, he could not claim any conveyance
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charges. However, there is no material on record to
substantiate this contention. Moreover, it is seen that this
plea was introduced by the defendants by way of amendment to
the written statement only after the conclusion of final
arguments.
26. Be that as it may, the plaintiff has failed to
establish that he actually transported the spoil to distant
locations. The fact that he did not disclose the alleged
dumping sites even in Ext.A28 suit notice casts serious doubt
on his claim. In the plaint as well, precise locations were
not specified; only the names of certain places were
mentioned. This aspect assumes considerable significance. The
plaintiff asserts that those sites were situated at an
average distance of 20 kilometres from the canal site. As
rightly contended by the learned Government Pleader, apart
from vague pleadings in the plaint, there is no material to
show that the plaintiff had, at any point, intimated the
defendants regarding the alleged dumping sites.
27. In an attempt to prove that he transported the spoil
to the three locations mentioned in the plaint, the plaintiff
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took out a Commission, which resulted in Ext.C1 report.
Significantly, the trial court found the report unreliable.
We also find that the evidence of the Expert Commissioner,
examined as DW5, does not inspire confidence. He claimed to
have seen documents showing that the plaintiff had intimated
the defendants about the three dumping sites. However, no
such document is forthcoming. The learned counsel for the
plaintiff fairly conceded that no such document exists and
that the locations were mentioned for the first time in the
plaint. On the materials available, we are unable to conclude
that the spoil was in fact transported and dumped by the
plaintiff at the three locations stated in the plaint,
allegedly situated more than 20 kilometres from the canal
site.
28. Sri Babu Thomas, learned counsel appearing for the
plaintiff, contended that since the total stretch of the work
extended to 7 kilometres, the plaintiff would necessarily
have had to transport the spoil for a distance exceeding 5
kilometres at least at certain points. We are unable to
accept this submission as a matter of inevitability. The
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distance required for conveyance would depend upon the
precise location where the spoil was ultimately dumped. It is
conceivable that the spoil could have been deposited at a
point situated between the two farthest ends of the stretch.
Therefore, it cannot be presumed that dumping the spoil
necessarily required transportation beyond 5 kilometres.
29. When the plaintiff claims damages on the ground that
he carried out additional work by transporting spoil to a
distant location, it was incumbent upon him to establish the
same with precision and cogent evidence. In the absence of
satisfactory proof regarding the actual place and distance of
dumping, the claim cannot be sustained. Accordingly, we
conclude that the plaintiff is not entitled to any amount
towards conveyance and disposal of surplus spoil.
30. The next issue to be considered is as to who was
responsible for the delay in execution of the work. It is
undisputed that the original contractual period expired on
21.10.1996. It is equally undisputed that the plaintiff
executed supplementary agreements/undertakings seeking
extension of time for completion of the work, agreeing
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therein that he would not claim any additional amount for the
extension of time.
31. At the same time, the evidence indicates that, for a
considerable period, both parties were genuinely uncertain as
to the location where the surplus spoil was to be dumped,
particularly when it became evident that the entire quantity
of excavated earth could not be accommodated along the canal
banks. It took several months to resolve this issue.
32. Further, Ext.A7 reveals that the Chief Engineer,
Project III (Kallada), Kottarakkara, addressed a
communication dated 03.07.1996 to the Chief Engineer, Project
III, Thiruvananthapuram, stating that there was no stock of
cement available in any of the KIP stores and that the work
had remained at a standstill for the preceding four months.
The letter further requested urgent supply of 4,855 metric
tonnes of cement for the work. (It is noteworthy that Ext.A7
was produced before the court in its original form, even
though a copy had not been marked to the plaintiff. Learned
counsel on both sides were unable to explain how the original
came into the plaintiff's possession. However, as the
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document was marked in evidence without objection, this
circumstance is of no consequence.) Though the trial court
observed that as per paragraph 39 of Ext.B1(c) notice
inviting tender, the plaintiff could not have made a claim
for extra payment on account of the delay in supply of
materials, the fact that non-supply of materials caused delay
in completing the work, is a factor relevant for the present
consideration.
33. Similarly, DW2, the Superintending Engineer of the
Public Works Department, discloses in cross examination that
there was some delay in taking level measurements and
completing the related formalities, which were essential
prerequisites for commencement of the contractual work.
34. However, referring to Ext.B16 and B20, the learned
Government Pleader contended that the delay in taking level
measurements was attributable solely to the plaintiff's
failure to appoint a Site Engineer. Engagement of a Site
Engineer prior to commencement of level measurement was
mandatory under the agreement, it was pointed out.
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35. Placing reliance on the decision of the Hon'ble
Supreme Court in State of Kerala and Another v. M.A. Mathai
(AIR 2007 SC 1537), the learned Government Pleader further
submitted that, under Sections 55 and 56 of the Indian
Contract Act, 1872, delay in performance may give rise to a
claim for compensation or frustration of contract. However,
where the contractor seeks extension of time and undertakes
to execute the work without claiming any additional amount,
he is estopped from subsequently raising such claims.
36. According to the learned Government Pleader, in view
of the undertakings contained in Ext.B27 and other
supplementary agreements, wherein the plaintiff expressly
agreed not to seek any further claim for extension of the
contractual period, no additional amount can be awarded to
him on that ground.
37. Relying on the decision of the Hon'ble Supreme Court
in General Manager, Northern Railway and Another v. Sarvesh
Chopra [(2002) 4 SCC 45], Sri Babu Thomas K., learned counsel
for the plaintiff, contended that even where a contract
contains a clause under which the contractor undertakes not
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to make any claim for delay attributable to the employer,
such a claim would nevertheless be maintainable if the
contractor repudiates the contract or clearly communicates
that escalation of rates or compensation for delay must be
granted by the employer.
38. The learned counsel placed reliance on Ext.A17
letter addressed by the plaintiff to the Minister, with a
copy to the Chief Engineer, to substantiate his contention
that the plaintiff had made his position explicit. In the
said communication, the plaintiff stated that, if he were to
proceed further with the contract, additional charges on
account of delay and related expenses would have to be paid.
Alternatively, he expressly sought to be relieved of his
contractual obligations upon payment of reasonable
compensation.
39. Upon evaluating all the circumstances brought to our
attention, we find that the delay in execution of the work
was occasioned partly by lapses of the defendants and of
course, the plaintiff could not claim to be fully absolved
from it. Undoubtedly, the plaintiff executed Ext.B27 and
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other supplementary agreements on various dates seeking
extension of time, undertaking that he would not claim any
additional amount on account of delay. At the same time, we
notice that the element of economic duress pervades these
transactions, as evidenced by the fact that part bills were
mostly passed only after execution of such undertakings.
Though part bills could have been encashed monthly, they
were, in certain instances, encashed only after the plaintiff
furnished corresponding undertakings. DW2, a senior officer
of PWD, deposed in cross-examination as follows:
"21.10.96 ൽ വവാദദിയ്ക്കു പണദിചചെയ്തതദിൽ വച്ചു ചകവാടുകവാൻ ഉണവായദിരുന്ന 5381185/- രൂപ
വവാദദിയ്ക്കു ചകവാടുകവാചത പ്രതദികൾ 28.12.96 വചരെയയും പദിടദിച്ചു വചദിരുന്നദിലല്ലേ (Q) പദിടദിച്ചു വചദില്ലേ,
ചകവാടുതദിരുന്നദില്ലേ."
(Page 7)
"ഈ Ext .A 26 notice issue ചചെയ്തു 26-5-99 ൽ പ്രതദികൾ വവാദദിയ്ക്കു പണദി ചചെയ്തതദിൽ വച്ചു
ചകവാടുലകണ Rs 4162276/- വവാദദിയ്ക്കു ചകവാടുകവാചത പദിടദിച്ചു വചദിരുന്നലല്ലേവാ എന്നു പറഞവാൽ
ശരെദിയലല്ലേ (Q) മനപ്പൂർവയും ചകവാടുകവാതദിരുന്നതല്ലേ (A). "
(Page 11)
"Ext .B 1 (f) ൽ ഒപദിടദില്ലേവായദിരുചന്നങദിൽ ഈ രൂപ 7124565/- pay ചചെയദില്ലേവായദിരുന്നലല്ലേ
(Q) പണയും release ചചെയദില്ലേവായദിരുന്നലല്ലേവാ (Q) പണയും release ചചെയദില്ലേവായദിരുന്നു.
Supplementary agreement sign ചചെയണമവായദിരുന്നു (A)"
(Page 11)
Thus, DW2 conceded that the department would not have passed
2026:KER:14556
the bills for the work already executed by the plaintiff
unless he furnished the undertakings, and that the bills were
kept pending for some time, obviously without any justifiable
reason. Hence, the plaintiff's contention that he was
compelled to execute the undertakings to secure clearance of
his bills appears probable. This circumstance must be read in
conjunction with the stand adopted by the plaintiff in
Ext.A17, wherein he unequivocally conveyed as follows:
"The schedule of rates has been revised upward
by the department with affect from 7/96 and the
increases is about 40%. Considering all these facts I
am entitle to get enhanced rates at the current
schedule of rates (revised rates) + 75% excess for all
the times of works being executed in the extra
contractual period. Since the delay in the completion
of the work with in the stipulated programme is solely
due to the slackness from the part of the
department........
Otherwise, I request to relieve me from the
contractual obligations which are violated by the
department with reasonable compensation to me for the
losses sustained by me which are explained above."
40. These circumstances lead us to conclude that,
notwithstanding the execution of undertakings while seeking
extension of time, the plaintiff is entitled to some
compensation for the delay in completion of the work. The
presence of economic duress is discernible from the attendant
2026:KER:14556
facts and circumstances. When such undertakings are executed
under economic duress, they do not preclude the plaintiff
from claiming reasonable compensation for the losses suffered
due to the delay. In Central Inland Water Transport
Corporation Ltd. & Anr. v. BrOjo Nath Ganguly & Anr. [(1986)
3 SCC 156), the Hon'ble Supreme Court held that courts would
not enforce an unfair or unconscionable term of contract, if
the bargaining power of parties is unequal, and especially
where the inequality of bargaining power is the result of the
great disparity in the economic strength of the contracting
parties. In M/s. Ambica Construction v. Union of India [2006
(13) SCC 475], also the Hon'ble Supreme Court adopted a
similar view. In State of Kerala v. P.P.Thomas (2024 KHC
801), this Court held that when parties are not on equal
footing with respect to the bargaining power and when one
party is in a position to exploit the other party, the
supplementary agreements signed by vulnerable party without
free consent is not legally enforceable as the same is
opposed to public policy and void in the eyes of law.
41. We shall now determine the quantum of such
2026:KER:14556
compensation. Ext.A17 indicates that a substantial portion of
the work had been completed by the time the plaintiff issued
the said letter. Although the plaintiff contended that
certain works continued up to 2003 and that some spill-over
works were undertaken even in 2006, the evidence suggests
that these were minor in nature and that the substantial part
of the work had been completed by 1997-98.
42. The learned counsel for the plaintiff relied upon
the decision in P.M. Paul v. Union of India [(1989) Supp. 1
SCC 318], wherein the Hon'ble Supreme Court observed that
price escalation is a normal incident arising from the lapse
of time in performing contracts in an inflationary economy,
and upheld the grant of 20% compensation for delay in
performance. It was further contended that, having regard to
the revised PWD Schedule of Rates (Ext.A34) brought into
effect from 01.07.1999, compensation ought to be fixed at 15%
per annum.
43. However, as noted earlier, the plaintiff also
contributed to the delay. Taking into account the totality of
2026:KER:14556
circumstances, we consider it just and reasonable to award
compensation to the plaintiff at 10% over and above the
awarded amount. Admittedly, the original amount awarded
(Rs.4,76,63,804/-) was revised to Rs.6,54,25,509/- by
24.04.1996 and the same was later further revised to
Rs.7,32,12,545/- [Ext.X5(a)]. Thus, the plaintiff is entitled
to get Rs.73,21,254.5/-, being the 10% of Rs.7,32,12,545, the
amount awarded under the contract.
44. There is no reason to decline interest on the said
amount, from the date of suit. Granting interest at 6% would
be just and reasonable.
In the result, the appeal is allowed in part and the
impugned judgment is set aside. The appellant/plaintiff is
entitled to get Rs.73,21,254.5/-, with 6% interest from the
date of the suit. The appellant is entitled to get
proportionate costs throughout. Sd/-
SATHISH NINAN, JUDGE
sv Sd/
P. KRISHNA KUMAR,JUDGE
