THE HON’BLE SRI JUSTICE ABHINAND KUMAR SHAVILI AND THE HON’BLE SRI JUSTICE VAKITI RAMAKRISHNA REDDY C.C.C.A.No.68 OF 2005 AND C.C.C.A.No.10 OF 2006 COMMON JUDGMENT: (Per Hon’ble Sri Justice Vakiti Ramakrishna Reddy Aggrieved by the judgment and decree, dated 06.10.2004 in O.S.No.501 of 2001 rendered by the learned XIII Additional Chief Judge, City Civil Court, Hyderabad, the plaintiff filed C.C.C.A.No.68 of 2005 and defendant Nos.1 to 4 filed C.C.C.A.No.10 of 2006.

2. Heard learned counsel for the parties and perused the record.

3. For the sake of convenience, the parties will be referred as arrayed before the trial Court.

4. The plaintiff-M/s. M.S. Constructions, a registered civil construction firm filed a Suit against the Roads & Buildings Department, the then Government of Andhra Pradesh (presently the State of Telangana) and its officials (defendants) for declaration that the termination of the contract by defendant No.4 (Executive Engineer) under Clause 60(a) of the contract was illegal, arbitrary, without jurisdiction and for recovery of Rs.64,43,227/- with interest @ 24% per annum and other reliefs. The trial Court decreed the Suit of the plaintiff for Rs.12,11,956/- only against defendant Nos.1 to 4 with interest @ 6% per annum from the date of institution of the Suit and the Suit against defendant No.5 was dismissed. Both the parties have preferred these appeals challenging various findings. Both sides challenge findings of the trial Court on various factual and legal grounds, primarily concerning non-completion of works, delays and alleged wrongful termination.

PLEADINGS BEFORE THE TRIAL COURT

5. The plaintiff’s version:

i)

The plaintiff asserts that the department failed to provide an unencumbered work site, specific alignments, and necessary drawings at the outset. The site was said to be partly under the control of the Forest Department with access to men and materials repeatedly obstructed by forest officials and restricted working hours.

ii)

The plaintiff recounted that on multiple occasions labourers were not permitted entry to the site, materials transportation was limited to certain hours and forest officials even detained some workmen requiring payment of a penalty. Numerous formal requests were made to the department for clearances, approvals and permissions but the response was sporadic and inadequate.

iii)

According to the plaintiff, these delays forced them to keep resources idle, inflating operational costs and making timely completion impossible. Eventually, the contract was terminated while a significant amount of certified work remained unpaid. The unpaid bills, wrongful deductions and the withholding of earnest money and security deposits led the plaintiff to seek declaratory relief and a decree for Rs.64,43,227/-

plus interest and costs.

6. The defendants’ version:

i)

The defendants, in response, deny any lapses on their part or obstruction of the plaintiff’s work. They assert that the plaintiff, a seasoned contractor had thoroughly inspected the site prior to bidding and was well aware of the jungle terrain, rock boulders, and proximity to forest lands factors that were expressly part of the contract’s risks.

ii)

The defendants insist that payments were made in accordance with measured and certified work and any delays or extra expenses stemmed from the plaintiff’s failure to properly organize and execute the contract. The contract was terminated only after granting multiple extensions and opportunities to finish the work, none of which were utilized effectively by the plaintiff.

iii)

They further argue that contract provisions entitled the department to withhold deposits and re-assign incomplete work to new contractors. Any claims for loss, escalation or damages are denied as being contrary to the signed agreement.

7. Basing on the above pleadings, the trial Court framed the following issues for trial:

1. Whether the plaintiff is entitled for a decree against all the defendants jointly and severally for Rs.64,43,2