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2008 Supreme(Ori) 1129
IN THE HIGH COURT OF ORISSA
Sanju Panda, J.
STATE OF ORISSA AND ANOTHER - APPELLANT
Versus
KAMAL LOCHAN MOHAPATRA - RESPONDENT
First Appeal No. 113 of 1994
Decided On : 15-02-2008
Addl. Standing, for the Appellant; R.N. Naik, A. Deo, B.S. Tripathy, P. Panda, D.K. Sahu, P.K. Mishra, M.P. Jagdev Ray and R. Rath, for the Respondent
The main legal point established in the judgment is the interpretation and applicability of the provisions of the Limitation Act, specifically Article 27, Article 112, and Article 55, in the context of a money suit filed by the State Government.
Headnote:
Limitation - Money Suit - Article 27, Article 112, Article 55 - The court discussed the applicability of Article 27, Article 112, and Article 55 of the Limitation Act in the context of a money suit for realization of dues from a contractor. The court held that the suit was not barred by limitation under Article 112 as it was filed by the State Government, and Article 27 was not applicable in this case. The court reversed the finding of the lower court on the question of limitation and decreed the suit against the defendant with 6% interest on the amount from the date of the suit till realization.
Fact of the Case:
The plaintiffs filed a money suit for realization of dues from the defendant, a contractor, for incomplete construction work. The defendant contested the suit on grounds of limitation, non-cooperation, and non-maintainability.
Finding of the Court:
The court found that the suit was not barred by limitation under Article 112 and held the defendant liable for the outstanding amount. The court dismissed the suit as barred by limitation, but the appellate court reversed this finding and decreed the suit against the defendant.
Issues: The main issues were the applicability of limitation under Article 27, Article 112, and Article 55 of the Limitation Act, and the liability of the defendant for the outstanding amount.
Ratio Decidendi: The court's decision was based on the interpretation of the provisions of the Limitation Act, specifically Article 27, Article 112, and Article 55, and the applicability of these provisions to the facts of the case.
Final Decision: The appellate court reversed the finding of the lower court on the question of limitation and decreed the suit against the defendant with 6% interest on the amount from the date of the suit till realization.
JUDGMENT :
Sanju Panda, J. - The unsuccessful Plaintiffs are the appellants in this First Appeal against the judgment and decree dated 25.1.1994 and 5.2.1994 respectively passed by the learned Civil Judge (Senior Division), Keonjhar in Money Suit No. 1 of 1989 filed by the Plaintiffs for realization of Rs. 9,16,767.20 p. from the defendant along with pendente lite interest and future interest in the shape of damage at the rate of 12% per annum till realization.
2. The case of the Appellants-Plaintiffs, in short, is that an advertisement was made by them for Job No. 525/Rastriya Sadak No. 6 for construction of High Level Bridge over river Baitarani on National Highway No. 6. After following ail legal formalities including execution of agreement No. 1F-2(CE) of 1983-84, the job-work was entrusted to the Respondent-Defendant, who is an 'A' Class Contractor. The Respondent-Defendant started construction work from 12.5.1983 and as per the agreement, he was to complete the work by 31.12.1983. Since he did not complete the work within the stipulated period, time was extended and he continued the work till February, 1984. But, thereafter, he did not proceed with the construction to complete the job-work entrusted to him. Hence, show-cause notice was given to him on 13.6.1984 as to why his contract should not be rescinded and the work entrusted to other Contractor, or taken up departmentally at the extra cost to be borne by him as per the agreement. The defendant gave an evasive reply. So, a fresh tender was invited for execution of the incomplete work left by the defendant. But, thereafter, the department decided to take up the incomplete work by itself for the interest of general public and dealt with the work. Hence, on 31.12.1985 rescission order was passed and the incomplete work was completed on 31.12.1986. The plaintiffs spent a sum of Rs. 7,04,678/- to complete the incomplete work left by the defendant. The plaintiffs further assessed the stock materials kept by the defendant at Rs. 3,09,977/-. Thus, the total came to Rs. 10,14,655/- and against the said amount, the earnest money and the initial security deposits made by the defendant, totalling to Rs. 43,399.80 p. was adjusted and after deducting the said amount, there was an amount of Rs. 9,71,255.20 p. outstanding against the defendant. The defendant's security deposit of Rs. 25,468/- and withheld amount for sanction of extension of time Rs. 3,000/- and final bill of Rs. 26,020/- totalling to Rs. 54,488/- was also adjusted towards the claim of the Plaintiffs. Thus, a sum of Rs. 9,16,767.20 p. is still due to be recovered from the defendant. The cause of action arose within the jurisdiction of the Court on 31.12.1985 when the rescission order was passed and on 31.12.1986 when the work was completed by the department. Hence, the plaintiffs filed the suit.
3. The defendant contested the suit traversing the Plaintiffs' allegation. In his written statement, he stated that the suit was not maintainable for non-joinder of necessary and proper parties and it was barred by law of limitation. Further, the suit was also filed beyond the scope of agreement and the claim of the Plaintiffs was not covered under the said agreement. The rescission of contract was bad in law and also the plaintiffs did not disclose the time consumed by them to complete the incomplete work departmentally. The defendant could not complete the work due to non-cooperation of the plaintiffs because the machinery and materials were not supplied in time, for which the authority was responsible. Hence, the suit was liable to be dismissed with cost.
4. On the basis of the above pleadings of the parties, the learned Civil Judge framed as many as five issues and both the parties adduced oral and documentary evidence in support of their respective plea. After analyzing the evidence and materials on record, the learned Civil Judge recorded the following findings:
(1) The case is covered under Article 27 of the Limitation Act
