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1994 Supreme(Bom) 677
IN THE HIGH COURT OF BOMBAY
R. G. Vaidyanatha, J.
Messrs Dinshaw Dinshaw and others.... Appellants.
Versus
Indoswe Engineers Pvt. Ltd..... Respondent.
First Appeal No. 603 of 1979, decided on 14-12-1994.
Advocates appeared :
M.A. Kazi with J.R. Lalit, for the appellants.
Mrs. Anita Agarwal, for the respondent.
Headnote:Section 34-Contract Act, 1873, Section 73-Buildlng contract-No provision for interest in.
Contractor not entitled to interest prior to suit.
Section 34-Parties to contract-Absence of consent between them regarding payment of interest.
Plaintiff claiming Rs. 3330 and with interest up to date of suit Plaintiff committed breach of court out of non-completing-Almost abandoned work without completion-Hence no interest can be granted prior to date of suit.
Section 70-Building contract-Contractor-Done work not intending to do so gratuitously- Benefit enjoyed by defendant.
Defendand liable to pay compensation to contractor over value of work done.
Section 70-Restitution-Principle of-In the circumstances of the case whether applicable.
Held, from a bare reading of the section it clear that event if there is no contract for the performance of certain work and if the plaintiff has done that work, without intending to do that work gratuitiously and the Defendant has enjoyed the benefits thereof, then the Defendant is bound to compensate the Plaintiff in respect of such work. The equitable principle underlying Section 70 of the Contract Act is that there should be no under enrichment on the party at the cost of another. It is based on the principle or restitution which prevents unjust enrichment by one party.
Therefore, the settled position is that even if there is no contract between the parties, if the plaintiff had done the work and not intending to do so gratuitiously and the defendant has enjoyed the benefits of the works, the Defendant is liable to pay the compensation to the plaintiff over the value of the work done by him. In the present case, there is no defence either in the written statement or in the evidence that plaintiff had done this work gratuitously. On the other hand, the conduct of the plaintiff shows that he never intended to act gratuitously. On the other hand, he has been snowing the additional work in the running bill for which the Defendant has gone on making payments without any objection. Even though the Managing Director of the Defendant Company and Its officials used to visit the site frequently they had never raised any objection over any piece of work on the ground that it was not entrusted. Joint measurements taken clearly show that Defendant had no objection this additional work. Hence by applying the principle underlined under Section 70 of the Contract Act, the plaintiff is certainly entitled 10 the value of the work. Unfortunately the trial Court Judge has not considered this aspect at all. He rejected the claim of the plaintiff almost summarily with one sentence observing that the plaintiff is not entitled to this account since there was no contract. Hence, the finding of the trial Court Judge on this point is erroneous and liable to be set aside.
Section 73-Building contract-Contractor-Used Inferior quality of pipe but claimed for superior quality pipes value.
Court should have grant at least value of inferior quality pipes value but not to disallow entire claim.
Section73.
See Civil Procedure Code, 1908, Section 34.
2. The appellants-plaintiff filed a suit in the trial Court for recovery of money in respect of a building contract. The plaintiffs case is that defendant company entrusted construction of a bunglow and a factory to the plaintiffs. It appears the construction had been done by a previous contractor and then work was entrusted to the plaintiffs. The plaintiffs submitted their estimates and also rates which were accepted by defendant with some modification. The work was entrusted to the plaintiffs sometime in February 1970. It is also plaintiffs case that part of the work done by previous contractor was not of good quality and the matter was examined by the Architect Mr. Nene. When the work was in progress, the defendant also entrusted some additional work to the plaintiffs. The understanding was that plaintiffs should go on giving running bills and defendant should go on making payments. Accordingly, plaintiffs started the work and was giving running bills and the defendant was making payments. In all plaintiffs have done work of the value of Rs. 1,53,446,20 ps., for which bills have been issued. The defendant has made part payment to the extent of Rs. 1,25,000/-. The defendant has not paid the balance of Rs. 28,446.20 ps. inspite of repeated demands and exchange of letters. The work was almost complete by the end of February 1971. For the first time during March 1971, the defendant raised an objection regarding quality of the work and also about the measurements. The defendant had never raised any such objection till then. Defendants letter of objection was suitably replied by the plaintiffs. Apprehending that defendant may entrust the work to some other contract, plaintiffs rushed to Court and filed a suit for injunction in Regular Civil Suit No. 292 of 1971. The said suit later came to be withdrawn. The defendant appears to have completed the remaining work departmentally and as a result the plaintiffs have lost profit to that extent. Hence on these allegations the plaintiffs have filed a suit for recovery of Rs. 32,000/- as detailed in para 16 of the plaint.
3. The defence is as follows:--
The suit building contract is admitted. It is stated that plaintiffs abandoned the contract, and therefore, committed a breach of the contract. It is admitted that plaintiffs had submitted estimates and rates and they were accepted by the defendant subject to some modification. It is not admitted that defendant entrusted additional work to the plaintiffs. According to the defendant, the agreement was that for the running bills the defendant should pay 90 per cent, five per cent to be paid after the work is found satisfactory and then remaining five per cent to be paid only after the expiry of first rainy season or after six months whichever is longer. It is alleged that the work of the plaintiffs was not good. The quantities like measurements etc. are inflated. The material used was sub-standard. The work done was not according to the agreed specifications and it was not completed within the agreed time. That the defendant is not due any amount to the plaintiffs as claimed in the plaint. Filing of Regular Civil Suit No. 292 of 1971 and subsequent withdrawal are admitted. That plaintiffs are not entitled to any of the amounts claimed in the plaint. That the suit is not maintainable. It is prayed that the suit be dismissed with costs.
4. The learned trial Judge framed the following issues :--
1. Do plaintiffs prove that plaintiff (1) is a firm registered according to the provisions of the Indian Partnership Act?
2. Do plaintiffs prove that an amount of Rs. 1,53,446.20 paise was due to them from the defendants for the works of construction executed by them?
3. Do defendants prove that
