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2023 Supreme(Jhk) 960

IN THE HIGH COURT OF JHARKHAND AT RANCHI
SHREE CHANDRASHEKHAR, ANUBHA RAWAT CHOUDHARY, JJ.
M/s Deoraj Singh, Transport Contractor – Appellant
Versus
The Central Coalfield Ltd. – Respondent
Commercial Appeal No. 02 of 2020
Decided on : 04-10-2023

Advocates:
Advocate Appeared:
For the Appellant :Mr. Ajit Kumar, Mr. Parth Jalan, Advocate
For the Respondents:Mr. Amit Kumar Das, Ms. Swati Shalini, Advocate

The court emphasized that the plaintiff-company must prove anticipated profit on account of non-execution of work to be entitled to compensation. It also highlighted the need for evidence to establish loss of turnover resulting from delay in contract completion.

Headnote:

Compensation - Contract Frustration - Indian Contract Act 1872, Section 56 - General Terms and Conditions, Special Terms and Conditions - The court held that the plaintiff-company did not sustain loss and cannot claim compensation. The plaintiff-company was awarded additional work to compensate for the disturbance caused by villagers. The court referred to section 56 of the Indian Contract Act 1872 and various clauses of the General Terms and Conditions as well as Special Terms and Conditions to support its decision.

Fact of the Case:

The plaintiff-company, a transport contractor, filed a Money Suit claiming compensation for alleged losses incurred during the execution of a contract for removal of strata and transportation of coal. The defendant company contended that the contract had frustrated due to unforeseen events, and the plaintiff was not entitled to compensation.

Finding of the Court:

The court found that the plaintiff-company did not sustain loss and cannot claim compensation. The plaintiff was awarded additional work to compensate for the disturbance caused by villagers. The court referred to the Indian Contract Act 1872, General Terms and Conditions, and Special Terms and Conditions to support its decision.

Issues: The issues included the maintainability of the suit, frustration of the contract, loss sustained by the plaintiff, entitlement to compensation, and possession of the work site.

Ratio Decidendi: The court held that the plaintiff-company did not sustain loss and cannot claim compensation. The plaintiff was awarded additional work to compensate for the disturbance caused by villagers. The court referred to section 56 of the Indian Contract Act 1872 and various clauses of the General Terms and Conditions as well as Special Terms and Conditions to support its decision.

Final Decision: The Commercial Appeal was dismissed.

ORDER :

Shree Chandrashekhar, J.

This Commercial Appeal has been filed by M/s Deoraj Singh, Transport Contractor to challenge the judgment dated 29th November 2019 passed in Money Suit No. 08 of 2016 (renumbered as Original Suit No. 25 of 2017).

2. Money Suit No. 08 of 2016 was filed by M/s Deoraj Singh, claiming itself a transport contractor, for the reliefs as formulated in paragraph no. 37 of the plaint which are extracted, as under:

    “(a) That after adjudication a decree for Rs. 12,27,07,806.78 be passed in favour of the plaintiff and against the defendants.

(b) That a decree for pendente lite and future loss that may be sustained by the plaintiff during the of the suit be also granted in favour of the plaintiff.

(c) That cost of the suit be awarded to the plaintiff.

(d) that any relief or reliefs to which the plaintiff be found entitled be also granted to the plaintiff.”

3. In the Money Suit, the plaintiff which is the appellant before us (hereinafter referred to as the ‘plaintiff-company’) claimed a decree for Rs. 12,27,07,806.78/- with a decree pendent lite and future loss. Vide letter of intent dated 5th February 2013, the plaintiff-company was awarded the works of “hiring of shovels, tippers, drills, dozers water sprinklers, etc. for removal of strata including topsoil, various rocks, blasted rocks and blast hole drilling into all kinds of strata, excavation, loading, transportation, dumping, spreading and dozing of specified places”. The other connected works included grading and water spraying on the haul road and maintenance of the haul road; dewatering at the working site at Pandra OCP quarry and hiring of HEMM such as excavators, tippers, drills, dozers and water sprinklers to be deployed at outsourcing patch for the purpose of excavation, drilling, loading, transportation of coal, dozing of specified places, grading and water spraying on the haul road and maintenance of haul road as per the instruction of Project Authority at Pindra OC outsourcing patch.

4. The plaintiff-company pleaded that it mobilized the necessary men and machinery for the execution of the subject works which were to be completed within two years; from 18th February 2013 to 17th February 2015. This is an admitted position that there was no hindrance at the work site and the plaintiff-company which had already executed works at Phase-I of Pindra project was able to execute a part of the subject works. Sometime in April 2013, the villagers, particularly, Wali Mohammad and Md. Islam started creating serious obstructions which made it impossible to execute any work at the work site. The plaintiff-company further pleaded that the villagers had an oblique motive and the CCL also made complaints to the administration in this regard. Later on, the civil proceedings and the proceedings under section 107 of the Code of Criminal Procedure vide M.P. Case No. 155 of 2013 and M.P. Case No. 70 of 2014 were initiated by the Sub Divisional Magistrate at Ramgarh on the complaints of the CCL to restrain the villagers from indulging into violence and vandalism at the work site. Simultaneously, a proceeding vide M.P. Case No. 46 of 2013 was also initiated under section 107 of the Code of Criminal Procedure at the instance of the Project Officer at Pindra for restraining the villagers from creating disturbances and obstructions at the work site. Furthermore, the CCL instituted Money Suit No. 21 of 2013 against Md. Ali and Liyakat Mia and Money Suit No. 22 of 2013 against Wali Mohammad, Mohd. Islam and Md. Jabil in the Court at Ramgarh seeking compensation for the losses caused due to their illegal acts. It was further pleaded that the plaintiff-company continued to write letters to the CCL to resolve the issue with the villagers and some efforts were also taken by the management in this regard but only a small portion of the subject works under NIT dated 14th November

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