LexHIMACHAL PRADESH NAGAR VIKAS PRADHIKARAN versus M/S. AGGARWAL & CO.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A
HIMACHAL PRADESH NAGAR VIKAS PRADHIKARAN
v.
MIS. AGGARWAL & CO.
JANUARY 27, 1997
B
[K. RAMASWAMY AND G.T. NANAVATI, JJ.]
Conttact-Execution of-Escalatio11 charges 011 material-Claimed by
contractor'-He/d : Not e11titled to in view of the fact that the mate1ials were
not procured by the Contractor, but were supplied by the Depmtment and the
C cost of mate1ials w01ked out.
D
E
F
P.M. Paul v. Union of India, [1989] Supp. 1 SCC 368, referred to.
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 635 of
1997.
From the Judgment and Order dated 2.5.96 of the Himachal Pradesh
High Court in O.M.P. No. 626/93 in Ex. P. No. 27 of 1993.
Rajesh Srivastava, Ujwal Banerjee and H.K. Puri for the Appellant.
S.B. Upadhyay for the Respondent.
The following Order of the Court was delivered :
Leave granted.
This appeal by special leave arises from the judgment and order
dated May 2, 1996 of the Himachal Pradesh High Court Passed in O.M.P.
No. 626/93 in Ex. P. No. 27/1993. The admitted facts are that the respon-
dent had entered into an agreement with the appellant to execute certain
works pursuant to which there was a dispute which was referred to the
G Arbitrator, on directions of the High Court. The Arbitrator in the award
dated April 25, 1992 stated as under ;
"After considering whole matter submitted to me by both the
parties, both verbally and in writing I have come to this conclusions
H
that delay lies on that part of the respondent-Executive Engineer.
582
•
~·.
'
'•
H.P. NAGAR VIKAS PRADHIKARAN v. AGGARWAL & CO.
583
It is awarded that the plaintiffs shall be paid by the respondent-
A
Executive Engineer an increase of 25% over and above their
tendered rates for all works executed by them after the stipulated
date of completion i.e. 21.5.89."
The award was made rule of the Court. In implementation of the
award, the appellant worked out the details, as mentioned in the letter No. B
SDA(D)-Acctt-7/93-644-47 dated November 12, 1993 which reads as
under:
"With reference to your letter No. AV/SIM/804-93-94 dated
5.10.1993, I am enclosing herewith a cheque bearing No. 807801
C
dated 12.11.1993 amounting to Rs. 4,99,307 on account of payment
of award announced by the Director which has been made as rule
of court by the Hon'ble H.P. High Court. The details of the
awarded amounts and recoveries due to be made from you are as
under:
Gross amount of the work done after
11th R/A Bill i.e. after 21.5.1989 onwards
upto 26th RIA Bill)
Less cost of material i.e. Cement/Steel
supplied by the SDA on which there
has been no increase in the issue
rates.
(-)
Net amount
25% increase of Rs. 46,52669/0 as
awarded by the Arbitrator.
'Less 2% I.= Tax on 23,263 on
Rs. 11,63,167 12% S.C. on
1.-Tax
Rs. 2,792.00
(-)
Total Rs. 26,055.00
With held on account of recoveries
due to be made from you against
agreement No. 52 of 1987.88.
. Net payable
Please send stamped receipt.
(-)
Rs. 69,78,354.00
Rs. 23,25,685.00
Rs. 46,52,669.00
Rs. 11,63,167.00
Rs.
26,055.00
Rs.11,37,112.00
Rs. 6,37,805.00
Rs. 4,99,307.00
D
E
F
G
H
{
'
584
SUPREME COURT REPORTS
[ 1997] 1 s. C.R.
A
Yours faithfully,
r-
(Executive Engineer (D),
Shimla Development Authority,
v
Kasumpti, Shirnla-9".
B
It is seen from the contents of the letter that the appellant has
deducted only the cost of the material, i.e., cement and steel supplied by
the SDA on which there has been no increase in the issue. rates. After
,#
working out of the details, a sum of Rs. 4,99,307 became due to the
c
respondent. The appellant calculated the amount actually due and payable
to the respondent under the award less the income-tax and surcharge etc.
and the balance amount came to be paid. But when the respondent claimed
a further sum of Rs. 5,81,421, the appellant objected thereto under section
47 of the CPC. The High Court over-ruled the objection and directed
payment thereof. Thus, this appeal by special leave.
D
It is submitted by Shri H.K. Puri, learned counsel for the appellant
"'
that the enhancement of 25% is relatable to the tendered rates for the
works excuted by the respondent and does not relate to the rates of raw
•'
materials supplied by the appellant. He also submitted that cement and
~
E steel were supplied by the Department at the schedule rates in spite of the
delay in execution of the contract. Thus, escalation in price of raw materials
supplied by the appellant the entire burden was bExcerpt shown. Read the full judgment & AI analysis in Lexace.