Breach of contract occurs when one party fails to perform their contractual obligations, enabling the other party to terminate the agreement.

1 Plaintiff in a Suit for money, is the appellant.

2Plaintiff is a contractor, who entered into a contract with the Government on 13-10-1981 for the work in connection with the Kuttiyadi Irrigation Project - Improvements to Mokeri - Kayakkodi Road from 0/00 kms. to 4/700 Kms. The total cost of the work was Rs. 4,87,582/-. The work was to be completed on or before 16-4-1982 i. e. within five months from the date of the site was handed over. The work could not be completed within the stipulated period. There was extension of time for completion of the work till 30-9-1982, and within that date also, the work could not be completed. After that, by issuing Ext. A10 dated 19-2-1984, the plaintiff terminated the contract on various allegations. It was inter alia stated that the Government was not interested in the execution of the balance work under the contract, which amounted to unlawful repudiation of the contract, and that the plaintiff was treating the contract as repudiated by the Government. Then by issuing the proceedings dated 16-6-1984, the Superintending Engineer, P. W. D. Project Circle, Calicut terminated the contract, saying;
"Under the above circumstances, the contract of Sri. K. Abdulkhader, P. W. D. Contractor ............ is hereby terminated at his risk and cost and security deposit of Rs. 19,550/- furnished by contractor ......... is forfeited to the department. The balance work will be rearranged and if the Department sustains any loss on account of such rearrangement, the loss will be made good from Sri. K. Abdulkhader, contractor."
After waiting till 7-5-1985, as per the original of Ext. A11 Suit notice, the plaintiff called upon the Government to settle his claims, failing which the proposed Suit was intimated. Ext. A12 is the reply to suit notice, which repudiated the claim made by the plaintiff.

3According to the plaintiff, the Government has committed breach of contract, entitling him to terminate the contract and also claiming damages. But according to the government, it was the plaintiff who committed breach of the contract and the contract was rightly terminated by the Government and security deposit forfeited.

4 In the Suit, the reliefs prayed for are:
(a) to direct the defendants to pay a sum of Rs. 67,184/80 to the plaintiff with future interest at 12 per cent per annum;
(b) to declare that any rearrangement of the work if any, after termination of the contract SE (P) 20/81-82 shall not be at the risk of the plaintiff as to costs and consequences;
(c) to restrain the defendants by an order of injunction from taking proceedings for realisation of any amount by way of damages pursuant to the termination of the contract; for incidental reliefs.

5The Trial Court raised eighteen issues as arising out of the pleadings. The evidence before the Trial Court consists of PW 1 and Exts. A1 to A14, B1 to B5 and C1.

6The agreement in original along with the special conditions, notice inviting tenders, schedule etc. was produced as called for by the plaintiff. But the Trial Court omitted to "mark this document. In the judgment of the Trial Court, in summarising the pleadings, there are references to item number in the Agreement schedule. In Para.10 of the judgment, the Trial Court refers to Clause.6 & 7 of the terms of the contract, and the Trial Court was also relying on this original agreement, even though it omitted to mark that. Both the counsel agreed that this also may be marked in evidence in this Court. In the circumstances, the agreement in original is marked as Ext. B6.

7Issues 2 & 4 to 14 were considered together by the Trial Court and it held that in all respects the plaintiff was the defaulter in executing the work as per the contract entered into between himself and third defendant. In answer to issue No. 3, the court found that the termination of the contract by the department cannot be treated as illegal or against terms and conditions of the agreement. On these findings, the plaintiff was non suited. Aggriev