A party's failure to perform crucial contractual obligations constitutes a fundamental breach, thereby entitling the other party to seek compensation, with appropriate adjustments on interest rates based on contractual stipulations.

JUDGMENT :

HEMANT M. PRACHCHHAK, J.

1. The present First Appeal is filed under Section 96 of the CIVIL PROCEDURE CODE , 1908 read with Section 41 of the CPC at the instance of the appellants – State Authorities being aggrieved and dissatisfied with the judgment and decree dated 17.02.2000 passed by the learned Civil Judge, Valsad (herein after referred to as “the trial court”) in Special Civil Suit No. 159 of 1991, whereby, the learned Judge partly allowed the suit and directed the appellants to pay Rs.11,04,435/- to the respondent herein with 15% interest from the date of the suit till realization of the decreetal amount.

2. Brief facts leading to the present appeal are as under :-

2.1 The respondent was an engineer and Contractor and was registered with the Public works Department and also approved by various other department of the Government and carrying on his business of Contractor in the name of M/s. Gayatri Construction Co. It is the case of the appellant that the Executive Engineer, Navsari (R&B) division, Navsari, had invited tendors publicly on behalf of the Govt. of Gujarat, appellant herein for the work of constructing Regional Training Centre at Vansada and accordingly the respondent had filled the said tender and submitted to the concerned Department and as the respondent's tender was found competitive, the same was accepted by the appellant Department. That, the respondent had paid the initial security deposit amounting to Rs. 40,100/- and entered into a regular agreement, bearing no. B-2/14 of 1985-86 and as per the agreement, the work was required to be commenced as per work order issued to the respondent from 21.02.1986 which was required to be completed on or before 20.02.1988 and the said work was required to be curried out to the tune of Rs. 21,39,340-35 ps. That, the present contract created mutual bilateral reciprocal contractual obligations, inasmuch as, certain reciprocal contractual obligations were required to be performed first by the department and on its performance, the respondent was required to perform his part of the contractual obligations and as per the Department failed to perform their part of the contractual obligations, the above said work could not be completed within its stipulated time period. That the respondent had stated the reasons for the non-completion of the said work within its stipulate time period are as under :

2.2 That, as per the terms and conditions of the contract, the appellant was required to give item-wise programme, but no item-wise programme ever furnished by the appellant for executing the work. That, as per the contract, the appellant was required to supply the detailed working drawing were made available to the respondent, thereby the appellant committed the fundamental breach of the terms and conditions of the contract. That, the appellant was required to give line out for executing the above said work immediately to the respondent, on issuance of the work order, but, the appellant had not given the line out to the respondent and also, the required details of footing and columns were also not given and therefore, the work could not be proceeded and the line out was furnished to the respondent in the month of October, 1986 and thereafter also, the details of footings and columns and other working drawing were not provided which were requires to be provided alongwith work order, were not provided till the stipulated time period of the work was over. The respondent had further alleged that the appellant department did not make the payment of the extra work done and thus, due to non-payment of the work done also amounts to a breach of the terms and conditions of the contract. That, th