Transcription No. 34 (Appeal)

                   The Division Bench of the High Court, vide its order dated 7th October, 2002, allowed the appeal of the State Government and dismissed the suit of the appellant-Firm and also directed that the decretal amount deposited by the State Government and as permitted to be withdrawn by the Firm should be refunded within a period of four months from the date of the judgment. Being aggrieved by the said judgment, the appellant-Firm has filed this appeal by way of special leave petition before this Court who heard Mr. Altaf Ahmed, learned senior counsel for the appellant and Ms. Madhavi Divan, learned counsel for the respondent-State. Though the trial Court after accepting the claim of the plaintiff granted a decree to the extent of Rs. 2,27,000/- with proportionate costs and interest @ 6 per cent per annum from the date of suit till realization, in the appeal filed by the State after finding that the plaintiff was stopped from claiming damages against the Department as the final bill was accepted, the High Court allowed the appeal of the State and dismissed the suit of the plaintiff. The High Court non-suited the plaintiff mainly on the ground of Clauses 8 and 10 of the agreement and of the fact that the final bill was accepted by the plaintiff under protest. In view of the same, it is relevant to refer Clauses 8 and 10 of the agreement which are as follows: “Clause 8 No payment shall be made for any work estimated to cost less than Rs 1,000/- till after the whole of the said work shall have been completed and a certificate of completion given. But in the case of work estimated to cost more than Rs 1,000/- the contractor shall, on submitting a monthly bill therefore, be entitled to receive payment proportionate to the part of the work then approved and passed by the engineer in charge whose certificate of such approval and passing of the sum so payable shall be final and conclusive against the contractor. All such intermediate payments, shall be regarded as payments by way of advance against the final payments only and not as payments for work actually done and completed and shall not preclude the engineer in charge from requiring bad, unsound, imperfect or unskillful work to be removed and taken away and reconstructed or re-erected, nor shall any such payment be considered as an admission of the due performance of the contract or any part thereof in respect of the occurring of any claim nor shall it conclude, determine, or effect any way of the powers of the engineer in charge as to the final settlement and adjustments of the accounts of otherwise, or in any other way very or affect the contract. The final bills shall be submitted by the contractor within one month of the date fixed for the completion of the work, otherwise the engineer in charge’s certificate of the measurement and of the total amount payable for the work shall be final and binding on all parties. A bill shall be submitted by the contractor each month on or before the date fixed by the engineer in charge for all work executed in the previous months and the engineer in charge shall take or caused to be taken the requisite measurement for the purpose of having the same verified, and the claim, so far as it is admissible, shall be adjusted, if possible within 10 days from the presentation of the bill. If the contractor does not submit the bill within the time fixed as aforesaid, the engineer in charge may depute a subordinate to measure up the said work in the presence of the contractor or his duly authorized agent whose counter signature to the measurement list shall be sufficient warrant, and the engineer in charge may prepare a bill from such list which shall be binding on the contractor in all respects. It is the stand of the State and accepted by the High Court that the plaintiff-Firm has not fully complied with Clauses 8 and 10 of the agreement. It is also their stand that mere endorsement to the effect that the plaintiff has been accepting the amount as per final bill “under protest” without disclosing real grievance on merits is not sufficient and it amounts to accepting the final bill without any valid objection and grievance on merits by the plaintiff. The High Court has also accepted the claim of the State that by the conduct of the plaintiff in accepting the final bill, the Department has made full payment to the plaintiff, sending statutory notice and filing suit for recovery of the differential amount barred by principle of stopple. (800)

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