Andhra High Court High Court

K. Venkateswarlu And Co. Limited vs Secretary Irrigation … on 18 September, 2003

Andhra High Court
K. Venkateswarlu And Co. Limited vs Secretary Irrigation … on 18 September, 2003
Equivalent citations: 2003 (6) ALD 18, 2004 (3) ALT 110
Author: R S Reddy
Bench: R S Reddy


ORDER

R. Subhash Reddy, J.

1. This writ petition is filed for issuance of writ of mandamus or any other appropriate writ or direction, to declare the action of the second respondent in withholding a sum of Rs. 19,14,797/- from the bills payable to the petitioner, in respect of the contract work covered by Agreement No. LS/1/AIBP/GVC-IV/1999-2000, dated 30-4-1999, as illegal and arbitrary, and, directions are sought against the respondents to refund the said amount together with interest to the petitioner.

2. Necessary facts, in brief, are as follows:

The petitioner, a partnership firm, is engaged in the business of civil contracts. A contract relating to earth work, excavation and forming embankment, lining and construction of structures from Km 234.000 to Km 250.360 of Kakatiya main canal was entrusted to the petitioner, by entering into agreement No. ICB/AB-10/88-89, dated 19-12-1988. The said contract work, which was entrusted to the petitioner, was one among the six package works notified in Sree Ram Sagar Project. However, the said contract work was not completed within the stipulated time. The petitioner claims that as there are lapses and defaults committed by the respondents, the said work could not be completed, but, on the other hand, the respondents have claimed that the progress achieved by the petitioner, up to the end of the agreement period, was only 42.36%. In respect of the said work and other works covered in the same set of package, the Government has taken a decision cancelling the works and expelled the contractor on 7-2-1992, by invoking Clauses 9, 51 and 52 of the Agreement Bond executed in Lr.No.SE/CCH/Ts/T4/ 1283-8/774-77, dated 7-2-1992. Consequently, the petitioner pleading that there is default on the part of the respondent authorities, quantified his claim, and, filed suit; O.S. No. 69 of 1995 on the file of the First Additional Senior Civil Judge, Warangal. Ultimately, the said suit: O.S. No. 69 of 1995 was dismissed with costs on 8-4-2002. It is also relevant to mention here that with regard to other works, covered in the same set of package, for similar claims, five other suits are also filed in O.S. Nos. 316, 317, 318 of 1994, 17 of 1995 and 18 of 1995 and the Government issued G.O. Rt. No. 287, Irrigation and CAD (Projects Wing.SRSP.II(2)) Department, dated 3-5-1995, appointing one Mr. P. Shiva Rao, Advocate, as Special Government Pleader to appear and defend the above said cases on behalf of the respondents. The said appointment authorised him to defend all the above cases, including the suit filed by the petitioner. As the suit, in O.S. No. 69 of 1995, was dismissed with costs, the plaintiffs have shown Rs. 19,14,797/- towards their costs, which is inclusive of an amount of Rs. 10,43,200/-towards Senior Advocate fee and Rs. 3,47,733/-towards Junior fee. Similar amounts of Rs. 13,91,535/- are also awarded to the respondents, towards costs payable by the petitioner to the defauldants. As against the said judgment and decree, the petitioner has carried (he matter in appeal, which is pending consideration. However, the said pendency of the appeal is not relevant for the purpose of disposal of the present writ petition.

3. The petitioner also executed other two contract works of earth work, excavation and forming embankment, construction of structures and C.C. Lining of 21R from Km 0.00 to Km 20.225, and, 21R-4R from Km 0.00 to Km 9;000 in Warangal District. When he has claimed 22nd part bill for the above said works, for Rs. 31,26,853/-, on the instructions of the second respondent, the third respondent has recovered an amount of Rs. 19,14,797/- from the said bill, towards costs awarded in O.S. No. 69 of 1995 and paid balance amount of Rs. 12,12,056/- on 30-9-2002. Thereafter, the petitioner made several representations protesting such withholding and as the respondents failed to consider the same in its favour, the present writ petition is filed questioning the action of the respondents in withholding the said amount.

4. It is the case of the petitioner that very awarding of costs is incorrect and in any event, there is no authority or jurisdiction for the respondent authorities, for withholding the said amount towards costs awarded in O.S. No. 69 of 1995, from the current bills payable to the petitioner, in respect of the contract work, relating to earth work, excavation and forming embankment, construction of structures and C.C. Lining, covered by agreement No. LS/ 1/AIBP/GVC-4/1999-2000, dated 30-4-1999.

5. On the other hand, counter-affidavit is filed by the Superintending Engineer-second respondent herein, stating that against the decree passed in O.S. No. 69 of 1995 by the Court of the First Additional Senior Civil Judge, Warangal, the petitioner has filed I.A. No. 413 of 2002 in the trial Court for correction of the decree, and, also, filed Appeal Suit in AS. No. 1717 of 2002 questioning, awarding of costs also. As such, it is stated that it is not open for the petitioner to file this writ petition for the very same relief. It is stated that the Government has appointed one Sri P.Shiva Rao, Advocate, as Special Government Pleader to appear and defend the cases in O.S. Nos. 316, 317, 318 of 1994, 17 of 1995, 18 of 1995 and 69 of 1995. It is further stated that except in O.S. No. 69 of 1995, in all other cases stated supra, the Government has fixed remuneration for the said Special Government Pleader at Rs. 25,000/- in each case, but, however, in view of award of costs in O.S. No. 69 of 1995, Rs. 19,14,797/-which is inclusive of pleaders’ fee, the said amount was paid by the Government as per G.O. Rt. No. 26, dated 7-1-2003. Further it is stated that there is valid and executable decree against the petitioner, passed by the competent civil Court, and, when the amounts of the petitioner are in the hands of the decree holder department, the department has every right to withhold and adjust the said decretal amount.

6. The petitioner also filed detailed reply affidavit denying the various allegations made in the counter affidavit, filed by the respondents.

7. The learned Senior Counsel, Sri E. Manohar, appearing for Sri Ch. Poornachandra Rao, submits that the respondent authorities have no authority or jurisdiction to withhold the said amount of Rs. 19,14,797/- from the bills payable to the petitioner. It is further submitted that, as per Clause 20.1.4 of the agreement dated 30-4-1999, the respondent authorities are empowered to recover moneys due, for non-fulfilment of contract entered into with the respondents, but, they have no authority to withhold the costs awarded in the Original Suit, O.S. No. 69 of 1995. It is the further contention of the learned Senior Counsel that unless there is specific provision empowering the respondents to recover such moneys also, the action of the respondents in recovering the amounts is illegal and falls out side the scope of the above said clause in the agreement.

8. Contrary, the learned Government Pleader for Irrigation and Command Area Development submits that, as the petitioner has already moved the lower Court by way of filing Interlocutory Application and also by way of filing First Appeal before this Court, the petitioner cannot pursue for the relief simultaneously. Further, he submits that the respondent authorities are empowered to recover such money from the bills payable to the contractor, from the subsequent contract, in view the provision under Clause 71 of Preliminary Specifications to the A.P. Standard Specifications. The learned Government Pleader placed reliance on the judgment of this Court, in the case of the Executive Engineer, Irrigation, Circle No. 3, Nizamabad and Anr. v. C. Raghava Reddy, .

9. Having regard to the above respective submissions, the only question that falls for consideration before this Court is: whether the respondent authorities are empowered to withhold or adjust the said amount of Rs. 19,14,797/-, on account of costs awarded in O.S.No. 69 of 1995, from the current bills payable to the petitioner, covered by agreement dated 30-4-1999.

10. With reference to the above submissions, first, I propose to deal with the objection raised by the learned Government Pleader that the petitioner cannot be permitted simultaneously to pursue for the relief in writ petition, as well as, in A.S No. 1717 of 2002 in this Court and also I.A. No. 413 of 2002 in O.S. No. 69 of 1995 on the file of the First Additional Senior Civil Judge, Warangal. With reference to the said objection, it is to be seen that the petitioner is not questioning either quantum of costs or very awarding of costs in the present writ petition, but, the petitioner is questioning the action of the respondents in withholding the said amount in question, directly from the bills payable to him, pursuant to the contract work covered by agreement No. LS/1/AIBP/GVC-4/1999-2000, dated 30-4-1999. As the said issue is not in question either before the trial Court or appellate Court, it cannot be said that the petitioner is simultaneously pursuing for his remedies, for the relief sought in the writ petition. As such, the writ petition is maintainable for the relief, which the petitioner is praying for in the present writ petition.

11. With regard to authority and jurisdiction of the respondents for withholding the said amount towards costs awarded in the suit O.S.No. 69 of 1995, from the current bills payable to the petitioner towards contract work covered by agreement No. LS/1/AIBP/GVC-4/1999-2000, dated 30-4-1999, the learned Government Pleader relies on Clause 71 of A.P. Standard Specifications. The said Clause reads as follows:

“P.S.71: Recovery, of money from contractor in certain cases :–In every case which provision is made for recovery of money from the contractor, Government shall be entitled to retain or deduct the amount thereof from any moneys that may be due or may be due or may become due to the contractor under these presents and/or under any other extract or contracts or any other account whatsoever.”

12. So far as the agreement dated 30-4-1999 is concerned, the only provision empowering the respondents for recovery is governed by Clause 20.1.4, which reads as follows:

“20.1.4: Any recovery or recoveries advised by the Government Department either, State or Central, due to non-fulfilment of any contract entered into with them by the contractor shall be recovered from any bill or deposits of the contractor”

13. Though Standard Specifications form part of the contract, further question required to be considered is: whether, in view of Clause 71 coupled with terms of the Agreement dated 30-4-1999, the respondent authorities are empowered to retain or adjust the amount, having regard to its nature of claim. Preliminary Specification-71 of A.P. Standard Specifications empowers the Government to deduct or adjust the amount due to it, from the contractor, but, subject to availability of provision in the terms and conditions of the contract, to recover such money. The only provision, which is made in the agreement dated 30-4-1999, is in Clause 20.1.4, which empowers the Government Department to recover money from any bill of the contractor, due to the State or Central Government, for non-fulfilment of any contract. The said Clause will not empower the respondents to recover money irrespective of nature of claim. In the instant case, the respondents have withheld the money, which is not due to non-fulfilment of any contract work, but which is sought to be retained is based on the award of costs in the suit filed by the petitioner herein. In the judgment relied on by the learned Government Pleader, referred to above, it is a case where Clause 71 is invoked to recover money from the contractor for the left over work in another agreement. Having regard to the nature of claim in the instant case, money which is sought to be retained or adjusted, is on account of costs awarded in the suit filed by the petitioner. The above said decision relied on by the learned Government Pleader is not applicable to the facts of this case. It is clear from Clause 71 of Preliminary Specifications of the A.P. Standard Specifications, that the power of the Government to recover money is confined to certain claims, where provision is made in the agreement, but it will not cover every kind of claim. A reading of the provision under Clause 71 of Preliminary Specifications of A.P. Standard Specifications makes it very clear that the power for retention or deduction of money, from the money payable to the contractor, relating to any other contract, is subject to condition of provision in the agreement, but, not applicable to every kind of claim. So far as agreement dated 30-4-1999 is concerned, as per the terms and conditions of the contract, there is no provision, which empowers the respondents to recover or retain such money, which is not due to non-fulfilment of any contract, but, only on account of costs awarded in the suit filed by the petitioner herein. As such, the claim for retention of the money, on account of costs awarded to the respondents in the suit, O.S. No. 69 of 1995 is outside the scope of Clause 20.1.4 of the agreement dated 30-4-1999. As such, the respondents cannot recovery the same, in exercise of powers under Clause 71 of the Preliminary Specifications to A.P. Standard Specifications. In that view of the matter, I declare that the respondents have no authority or jurisdiction to retain the amount of Rs. 19,14,797/-, based on the decree dated 8-4-2002 passed in O.S. No. 69 of 1995 by the Court of First Additional Senior Civil Judge, Warangal; as such, the action of the respondents in withholding the amount in question is without any authority of law and jurisdiction. But, however, having regard to the facts and circumstances of the case, it is not a fit case for award of interest on the amount withheld.

14. For the foregoing reasons, the writ petition is allowed to the extent indicated above and consequently, I direct the respondents to pay the amount withheld i.e., Rs. 19,14,797/- (Rupees Nineteen Lakhs fourteen thousand seven hundred and ninety seven only), which money is payable to the petitioner in respect of 22nd part bill, covered by contract agreement No. LS/1/ AIBP/GVC-4/1999-2000, dated 30-4-1999, within a period of six weeks from the date of receipt of this order. No costs.