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1998 Supreme(Ker) 570

Judges : K.K.USHA,P.SHANMUGAM
Hindustan Construction Co.Ltd. - Appellant
Versus
K.S.E.B - Respondent
Case No : W.A.No. 343 of 1997
Decided On : 12/15/1998
Advocates Appeared :
F.S. Nariman, Darius J. Khambatta & M. Ramesh Chander For Appellants Rajiv Dhavan, S. Ramesh Babu & Government Pleader (K. Jayakumar) For Respondents

Judgment :-

P. Shanmugam, J.

This Writ Appeal is against the judgment declining to issue a positive direction sought for by the appellant.

2. The appellant is a Civil Construction Company, namely, Hindustan Construction Company Ltd. (hereinafter referred to as 'HCC') entrusted with the work of construction of the Power Tunnel in the Lower Periyar Hydro Electric Project by the Kerala State Electricity Board thereinafter referred to as 'the board) with an agreed period of construction of 68 months reckoned from 27.2.1984. Their contractual date of completion of construction was 26.10.1989. The period was extended by the Board upto 30.6.92. While the work was nearing completion, HCC submitted a claim on 6.5.1994 (Ext. P4) for compensation for delays in the execution of the project. The Board by order dated 2.3.93, Ext. P1, constituted a High Power Adhoc Committee and referred the issues raised by HCC in their memorandum dated 6.5.92 (Ext. P4). The Adhoc Committee submitted their report on 2.9.93. The Board constituted another sub-Committee on 30.10.93 to go through the report of the Adhoc Committee. The Sub Committee submitted their note on 10.11.93. The Board by order dated 19.4.94 (Ext. P3) sanctioned a sum of Rs. 250 lakhs as an interim payment as recommended by the Adhoc Committee which shall be adjusted against the final amount payable to HCC. Subsequently, the Board held several meetings and finally in their meetings held on 12.4.94 and 30.4.94 unanimously decided to accept the recommendation of the Adhoc Committee. Sanction order was issued by the Board dated 19.4.94 for an interim payment of Rs. 250 lakhs. However, no payment was affected in spite of repeated requests and hence HCC filed O.P. 7623/96 (Writ Petition under Art.226 of the Constitution of India) praying for a direction to implement the Board's order dated 19.4.94 (Ext. P3) and issue consequential orders on the basis of the unanimous decision of the Board dated 30.4.94. The learned Single Judge in his judgment dated 4.10.96 declined to grant a positive direction, but, however, directed the Board to take a decision in the matter. HCC filed Writ Appeal on 12.2.97 against the judgment inter alia contending that a positive mandamus ought to have been issued against the Board. Pending the appeal, by a communication dated 25.2.97, the Board informed HCC of their decision to cancel the earlier order dated 19.4.94 and a formal order of communication dated 29.3.97 (Ext. Rl(a)) was issued. HCC impugned this communication by amending the prayers in the Original Petition and the Writ Appeal (See separate order).

3. The case of the appellant-Company HCC can be summarised as follows: In deference to the genuine claim of HCC for compensation for the delays, the Board willingly accepted for an alternative mechanism in the form of an Adhoc Committee consisting of experts in the field and men of eminence to go into their claims comprised of 5 members including one HCC',s representative and the Chief Engineer (Civil) General & World Bank Projects of K.S.E.B. as the Convenor. The Adhoc Committee had 21 sittings, made site visits and considered voluminous documents. After a minute consideration of the whole matter submitted their recommendations recommending a payment of a sum of Rs. 808.26 lakhs as against the claim of Rs. 1688.08 lakhs by the HCC. The Board again constituted another Sub-Committee consisting of two members, one of whom was the Convenor and representative of the Board in the Adhoc Committee. It was after considering both these recommendations and report, the Board decided and sanctioned to pay an advance of 250 lakhs as an interim payment. From the decision of the Board dated 12.4.94 and the detailed note dated 21.4.94 of the Secretary and the subsequent decision on 30.4.94, it is clear that the Board had taken a unanimous decision to pay a sum of Rs. 808.26 lakhs to HCC as recommended by the Adhoc Committee. The decision of the Board has become final. However, on a









































































































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