IMPORTANT POINT
The court affirmed the right to forfeit a security deposit for non-completion of work as per contract terms, emphasizing the necessity of proving actual damages.

ORDER :

1. The present appeals have been preferred against the judgment and decree dated 17.02.2024 passed by the Commercial Court, Udaipur in Civil Suit No. 43/2021 (CIS No. 43/2021) whereby the suit for recovery as preferred by the plaintiff-CJ DARCL Logistics Ltd. has been partly decreed.

2. Vide the judgment and decree dated 17.02.2024, the plaintiff-Company had been held entitled for an amount of Rs.3,12,000/- (the earnest money) and Rs.76,907/- (the due bill) i.e. a total of Rs.3,88,907/- with interest at the rate of 6% per annum. The relief qua the refund of the bank guarantee to the tune of Rs.21,38,000/- stood dismissed.

3. The appeal (D.B. Civil Misc. Appeal No. 1678/2024) against the rejection of the relief qua the bank guarantee has been preferred by the plaintiff-Company whereas the appeal (D.B. Civil Misc. Appeal No. 1726/2024) against the decree qua earnest money and due bill has been preferred by the defendant-Rajasthan State Mines and Minerals Limited (hereinafter referred to as ‘RSMML’).

4. Appeal (D.B. Civil Misc. Appeal No. 1678/2024) preferred by the plaintiff-Company is reported to be barred by 5 days.

An application under Section 5 of the Limitation Act has been filed for condonation of delay.

For the reasons stated in the application, the same is allowed. The delay caused in filing the appeal is condoned.

5. An application for refund of the excess amount of Court fee has also been filed by the plaintiff-Company with a submission that at the first instance, inadvertently, regular First Appeal was filed against the impugned judgment and a Court fee of Rs.1,26,586/- was paid whereas a D.B. Civil Misc. Appeal was required to be filed against the impugned judgment and decree and hence, a Court fee of Rs.500/- was only required to be paid.

6. In the opinion of this Court, the submission as made is totally fallacious.

7. As is evident, the present is a suit for money recovery and because of valuation of the same being above Rs.5,00,000/- the suit was instituted before a Commercial Court.

8. The present appeal is against the judgment and decree as passed by the Commercial Court in a suit for recovery of money. The ad valorem Court Fee in terms of the Rajasthan Court Fees and Suits Valuation Act, 1961 shall therefore be payable on the present appeal.

Further, counsel for the plaintiff-Company could not point out any provision whereby the Court fee on a misc. appeal preferred against the judgment and decree passed by a Commercial Court in a suit for money recovery is fixed as an amount of Rs.500/-. The application is hence, dismissed.

9. Coming on to the merits of the present appeals, the facts are that the plaintiff-Company was issued work order dated 16.09.2016 for the work of “FEEDING OF LGO INTO PRIMARY CRUSHER HOPPER BY USING FRONT END LOADERS & TIPPERS AT IBP, JHAMARKOTRA MINES, UDAIPUR.”

10. As per the work order, approved rate was Rs.19.44/- per metric ton and the stipulated period for completion of work was from 01.10.2016 to 30.09.2018. A bank guarantee to the tune of Rs.21,38,000/- i.e. 10% of the valuation of the work was deposited by the plaintiff-Company.

11. However, due to the delay in completion of the work and the work not been performed satisfactorily, after service of various notices, ultimately the contract was terminated by the RSMML on 20.01.2018 (Exhibit D-13). As a consequence, the security deposit in the form of bank guarantee to the tune of Rs.21,38,000/- was forfeited. Fresh tenders for completion of the work were although invited but no work order qua the same was given to any other firm/company and the same was got completed by the RSMML vide its own resources and machinery.

12. Being aggrieved by the forfeiture of the security amount, the non-payment of the due bills and the non-refund of earnest money, the plaintiff-Company preferred the present suit in question for recovery of an amount of Rs.28,12,932/- (Rs.21,38,000/- + Rs.76,907/- + Rs.3,12,000/-) with interest thereupon.

13. It is relevant to