Interest awarded by the trial court must be just and reasonable; the appellate court reduced the interest rate from 12% to 9%, upholding the damage assessment.

JUDGMENT :

Hemant M. Prachchhak, J.

1. The appellants State Authorities have preferred present appeal under Section 96 of the Civil Procedure Code read with section 41 of Civil Procedure Code against the judgment and decree dated 30.10.1999 passed by the Civil Judge (S.D.) Bharuch (hereinafter be referred to as the "trial Court") in Special Civil Suit No. 149 of 1991, whereby the suit was partly allowed an amount of Rs. 9,72,582/- along with 12% simple interest was awarded in favour of the present respondent-original plaintiff.

FACTS OF THE CASE

2. The facts giving rise to present appeal are that the respondent herein-original plaintiff (hereinafter be referred to as the "plaintiff") is an Engineer and Contractor, duly registered as a P.W.D. contractor and with other departments. The present appellant No.2- original defendant No.2, Executive Engineer, Roads and Buildings Division, Bharuch, on behalf of original defendant No.1, had invited tenders for construction of an Administrative Block and Workshop Building for Muni I.T.I. at Jhagadia in Bharuch District.

2.1 The plaintiff had submitted his tender, which was found to be competitive and was accepted by defendant No.2. The plaintiff was called upon to deposit an initial security of Rs.23,000/- and upon payment of the same, a regular agreement bearing No. B-1/31 of 1987-88 was executed between the plaintiff and defendant No.2. As per the agreement, the work valued at Rs.12,93,120.80 ps. was to commence from 11.08.1987 and was to be completed within 18 months, i.e., on or before 10.02.1989. After issuance of the work order, the plaintiff commenced the work by mobilising materials and labour, but only one set of plans was given.

2.2 The plaintiff by letter dated 01.11.1987 requested details of doors, windows, trusses, reinforcement etc. and further informed on 27.12.1987 that the foundation excavation was completed in the first week of December 1987, but concreting could not be done as the foundation details were not clear. He also requested soil testing and further drawings. The plaintiff further intimated by letter dated 20.02.1988 that he had excavated one metre below the estimated depth but the foundations were not approved, and by letter dated 25.03.1988 he pointed out that as the strata consisted of black cotton soil, it was essential to excavate with 1:1:15 slope and that measurement should be paid accordingly. On 06.04.1988, he informed that the Deputy Executive Engineer had directed stoppage of work till final decision on the foundation strata was taken, and by letter dated 12.06.1988 stated that final plans and drawings were not supplied and the design was not finalised, which resulted in repeated removal of executed work. On 17.08.1988 and 30.08.1988, the plaintiff again pointed out that the design was still not finalised and that though initially a load- bearing design was given, the defendants later ordered continuation with partly load-bearing and partly frame structure, due to which he had to dismantle some work. By letter dated 10.09.1988, the plaintiff stated that he had incurred heavy losses due to indecision of the authorities and that he would submit a separate claim, and also raised the issue of overhead expenses, loss of interest on unpaid work and additional expenditure due to delay. By letter dated 02.10.1988, he informed that the drawings supplied by the Deputy Engineer were incomplete and, since the design was changed, he demanded new rates and costs for dismantled work, which he reiterated on 18.12.1988 after discussions with the Executive Engineer. At one stage, the plaintiff even expressed willingness to continue the