* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision : 8th November, 2011
+ RFA(OS) 54/2011
M/S.NICCO CORPORATION LTD. ....Appellant
Through : Mr.Pinnaki Addy, Advocate and
Mr.Shekhar Gupta, Advocate.
versus
M/S.S.N. NANDY & CO. ....Respondent
Through: Mr.S.D.Singh, Advocate.
CORAM:
HON’BLE MR. JUSTICE PRADEEP NANDRAJOG
HON’BLE MR. JUSTICE S.P.GARG
1. Whether the Reporters of local papers may be allowed
to see the judgment?
2. To be referred to Reporter or not?
3. Whether the judgment should be reported in the Digest?
PRADEEP NANDRAJOG, J.(Oral)
1. Vide impugned judgment dated 23.2.2011, plaintiff’s
suit for recovery of `92,20,562/- against the defendant has
been decreed in sum of `2,72,078.94 with proportionate cost,
pendente-lite and future interest @12% per annum.
2. As per the averments in the plaint, the plaintiff
‘M/s.S.N.Nandy & Co.’ had offered to execute works on turnkey
basis as per the requirement of the defendant/appellant and
that the various items of work to be executed were listed as
per Ex.PW-1/51 at a total price of `2,87,30,333/- and that
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during execution of the works, vide Ex.DW-1/P1 extra items
were agreed to be executed at the rate specified therein.
3. Alleging that for the extra work done the plaintiff
was entitled to `92,20,562/-, the suit was filed.
4. The appellant/defendant denied any extra work.
5. Thus, the main issue between the parties was
whether the plaintiff had executed extra work not covered by
the original letter of intent dated 15.10.1992, Ex.PW-1/6 and as
detailed in Ex.PW-1/51.
6. In para 7 of the impugned decision, the learned
Single Judge has noted, Ex.PW-1/9 and Ex.PW-1/17 i.e. letters
dated 2.3.1993 and 7.1.1994 as per which the plaintiff had
referred to meetings held on different dates and had asserted
therein that at said meetings the extra works listed in the
letters were agreed to be executed and that the defendant had
never refuted said letters.
7. We agree with the conclusion arrived at by the
learned Single Judge that not replying to the said letters
amounted to an admission, that as alleged in the two letters, at
the meetings held on the dates disclosed in the letters extra
work was agreed to be executed.
8. The reliance by the defendant upon the receipt,
Ex.PW-1/D1 that full and final payment was acknowledged as
being received by the plaintiff has rightly been refuted by the
learned Single Judge inasmuch as the receipt, Ex.PW-1/D1
clearly records that `9,36,900/- received towards full and final
payment pertained to the original contract value of
`2,87,30,000/-.
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9. We also agree with the view taken by the learned
Single Judge that `5,00,000/-, which were claimed by the
plaintiff as being paid when extra work was agreed to be
executed, being never adjusted against the running bills
pertaining to the main works, would evidence that there was an
agreement between the parties that the plaintiff would execute
extra work.
10. The defendant has admitted having received
plaintiff’s letter Ex.PW-1/D1 which is dated 15.3.1993 and in
which breakup of the rate for the extra work has been
indicated. The defendant never refuted the said letter.
11. Faced with the aforesaid, save and except to argue
that the defendant never wrote any letter to the plaintiff
requiring extra work to be executed, learned counsel for the
appellant/defendant has nothing more to argue.
12. The argument has to be noted and rejected for the
reason contractual obligations and variations to an existing
contract can well be oral. In the teeth of Ex.PW-1/D1, Ex.PW-
1/6, Ex.PW-1/9, Ex.PW-1/17, Ex.PW-1/51 and Ex.DW-1/P1 it is
apparent that at the meetings held on the dates disclosed in
the said letters it was agreed that extra works would be
executed. Defendant not having controverted the contents of
the said letter is proof of the correctness and truthfulness
thereof. Further, `5,00,000/- paid by the defendant to the
plaintiff which were never adjusted in the running bills
pertaining to the main work is also proof that extra work was
agreed to be executed.
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13. We note that from para 24 to para 37, the learned
Single Judge has worked out the revised scope of work, which
has been tabulated in paragraph 24 of the impugned decision
to bring out the excess and/or less work executed. The learned
Single Judge has so worked out with reference to Ex.DW-1/P1
i.e. the document as per which revised scope of work was
listed. With respect to Pump House-1 and Pump House-2 the
learned Single Judge has noted less work executed and thus, as
per contractual rates has held that the defendant would be
entitled to a corresponding price reduction, vis-à-vis the
original contract price as per Ex.PW-1/51 in sum of `1,29,843/-
and `1,85,937/- respectively. With respect to the alleged third
extra item of work i.e. DAF building, the learned Single Judge
has held that as per original contract work evidenced from
Ex.PW-1/51 a DAF unit had to be erected and which would
include the building and thus has negated said claim. Similar is
the position with respect to the claim for MCC building for the
reason original contract envisaged MCC transformer room to be
constructed which obviously meant a building to house the
unit. Claim towards Influent Slump has been held not payable
as it was found not to be an extra work. Similarly, no extra
work pertaining to Apron around RCC Tank being held
established, claim towards said amount has been negated.
With respect to the next item of claim i.e. office-cum-lab the
learned Single Judge has noted that as per Ex.PW-1/51 quantity
to be executed was 300 sq.mts. and as per Ex.DW-1/P1 330.77
sq.mts. extra work was executed and for which sum held
payable to the plaintiff has been determined at `1,10,000/-.
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Similarly, pertaining to the Treatment Effluent Sump excess
work of 60 cubic meters having been executed has been
determined and price payable, as per contract, has been
determined at `3,00,000/-. Similarly, excess work having been
found to be executed pertaining to Sludge Lagoon/Drawing Bed
a sum of `1,05,000/- has been held payable to the plaintiff. On
the similar process of reasoning, by contrasting the works
listed in Ex.PW-1/51 and the revised works as per Ex.DW-1/P1,
holding extra work executed for Pump House at Common Catch
Pit `1,85,000/- has been held payable to the plaintiff and in
respect of Cooling Tower Basin over Common Catch Pit
`1,20,000/- has been held payable to the plaintiff. `29,347/-
has been held payable towards extra quantity of the boundary
wall and for reconstruction of the boundary wall, for which
letters dated 27.11.1994 and 30.11.1994 i.e. Ex.PW-1/23 and
Ex.PW-1/25 respectively were considered, `1,53,217.50 has
been held to be payable.
14. To put it pithily the works as per Ex.PW-1/51 i.e. the
original works agreed to be executed and the revised works as
per Ex.DW-1/P1 have been worked out by the learned Single
Judge.
15. Learned counsel for the appellant concedes that the
original works agreed to be executed were as per Ex.PW-1/51
and does not dispute that Ex.DW-1/P1 was received by the
plaintiff. As noted hereinabove contemporaneous letters
written by the plaintiff to the defendant in which it was
asserted that at meetings held revised works were required to
be executed and the same were detailed in Ex.DW-1/P1 were
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never refuted and thus the learned Single Judge has drawn a
correct inference.
16. Challenge by learned counsel for the appellant to
the findings of the learned Single Judge with reference to
Section 70 of the Indian Contract Act are simply noted by us
without any further discussion inasmuch as the said discussion
by the learned Single Judge, as per para 17 of the decision is on
the assumption that the extra works executed were never
agreed to be executed by the defendant, but since as a matter
of fact the works were executed and accepted by the
defendant, the learned Single Judge has, in the alternative
discussed the impact of Section 70 of the Indian Contract Act
with respect to the plaintiff having admittedly executed
additional works which were accepted by the defendant.
17. Since there is enough evidence to show that the
extra works were executed by the plaintiff upon an oral
agreement between the parties, we need not bother ourselves
on the alternative reasoning which is on an assumption.
18. The appeal has to fail as regards the principal sum
adjudicated by the learned Single Judge, but we have to speak
a word on the cost and interest awarded in favour of the
respondent.
19. From a perusal of the impugned decision it is
apparent that an inflated claim in sum of `92,20,562/- has been
found to be payable only in sum of `1,86,784.50 and pre-suit
interest is `86,294.44 and thus the decree is in sum of
`2,72,078.94. The plaintiff has succeeded only to the extent of
about 2% of the claim. Had the plaintiff been honest with the
RFA(OS) 54/2011 Page 6 of 7
defendant, in all probability the defendant would have sorted
out the matter across the table. So inflated and grossly
exaggerated was the claim that the plaintiff left no scope for
the defendant to sit and negotiate.
20. Thus, we are of the opinion that the plaintiff should
not be entitled to any pre-suit interest or any pendente-lite and
future interest as also proportionate costs.
21. We have a legal reason for denying interest. The
sum was unascertained till the learned Single Judge did so.
The claim was highly exaggerated and the sum was not
ascertainable.
22. Thus, the appeal is partially allowed. Impugned
judgment and decree dated 23.2.2011 is modified and the suit
filed by the plaintiff/respondent is decreed in sum of
`1,86,784.50 without any pre-suit or pendente-lite interest.
Future interest at the rate of 12% per annum from date of
decree passed by the learned Single Judge on said sum is
awarded to the plaintiff and against the defendant. Parties
shall bear their own costs all throughout.
(PRADEEP NANDRAJOG)
JUDGE
(S.P. GARG)
JUDGE
NOVEMBER 08, 2011
mm
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