Judgment  Sheet

 

IN THE HIGH COURT OF SINDH AT KARACHI

 

Suit No. 306 of 2000

 

       Present :

       Mr. Justice Nadeem Akhtar

                                                                       

 

Date of hearing   :  08.11.2012.                                   

 

Plaintiff                  :  Syed Altaf Hussain, deceased through his legal heirs, Mrs. Shamshad Altaf and Syed Azeem Altaf,  through Mr. H. A. Rahmani, advocate.

 

Defendants         :   Province of Sindh and Senior Member Board of Revenue, Government of Sindh, through

Ms. Afsheen Aman, the State Counsel.

 

 

J U D G M E N T

 

NADEEM  AKHTAR, J.-           The plaintiff has filed this Suit against the defendants for recovery of outstanding amount payable to him by the defendants under a contract, and also for damages sustained by the plaintiff in view of the breach of contract committed by the defendants. 

 

2.        It is the case of the plaintiff that, at the relevant time, he was engaged in the business of Civil Engineers and Contractors as the sole proprietor thereof.  In the year 1990, defendant No.2 invited tenders for construction of 82 independent residential units / bungalows in the Revenue Staff Colony at Sukkur  (the project).  The plaintiff submitted his tender for the project, which was accepted by defendant No.2 vide its ‘Letter of Award’ dated 20.09.1990. The project was named by defendant No.2 as the ‘Multi Dimensional Security Development Project (MDSDP)’. As per the Letter of Award issued by defendant No.2, the plaintiff was initially required to construct only four residential units at the “reduced cost” of Rs.2,040,000.00,  and the remaining project was to be carried out by the plaintiff subject to approval of the modified PC-I of the project by the relevant Government authorities and the plaintiff’s  acceptance of the revised price of the remaining work of the project. 

 

3.        The plaintiff accepted the terms and conditions of the Letter of Award, and successfully executed the work by constructing four units. Upon successful execution of the said work by the plaintiff, defendant No.1, through defendant No.2 and the Project Director MDSDP, entered into an Agreement dated 08.11.1990 (the Agreement), with the plaintiff, whereby it was agreed by the parties that the plaintiff shall execute the work of the project.  Consequently, a ‘Letter of Award (2nd Part)’ dated 24.04.1991 was issued by defendant No.2 awarding the work of the remaining 78 units of the project to the plaintiff. Through this Letter, it was confirmed by defendant No.2 that, as the required approval of modified PC-I of the project had been obtained, the offer of the plaintiff for the project had been accepted. The total contract price was agreed at Rs.23,923,330.50 including the already accepted reduced price of Rs.2,040,000.00.  It was mentioned in both the aforementioned Letter of Award  dated 20.09.1990 and Letter of Award (2nd Part) dated 24.04.1991, that the defendants had appointed National Engineering Services (Pvt.) Limited (NESPAK) as the ‘Engineer’ for the project. 

 

4.        It is also the case of the plaintiff that he successfully performed his agreed part of the contract by completing the project in June 1996. After proper scrutiny and recommendation by the Engineer, the plaintiff  submitted to the defendants his 14th running bill dated 27.10.1998 for Rs.4,273,292.00 and the 15th running bill dated 20.02.1997 for Rs.1,561,158.00.  Along with his 14th and 15th running bills, the plaintiff also demanded from the defendants a sum of Rs.2,019,468.00 towards the balance retention money, which had   also been recommended by the Engineer for payment. Thus the      total amount claimed by the plaintiff from the defendants was Rs.7,853,818.00, which included the outstanding amount of Rs.6,886,718.00 pending from his 14th and 15th running bills, and Rs.2,019,468.00  towards the balance retention money. 

 

5.        The plaintiff has stated that despite successful completion of the project by him in June 1996, confirmation in this behalf by the Engineer, and recommendation of the Engineer for payment of his outstanding 14th and 15th running bills and the balance retention money, the defendants deliberately avoided to pay him the outstanding amounts. Only a sum of Rs.967,100.00 was paid by defendant No.2 as a part payment through a cheque dated 15.02.1997 leaving an amount of Rs.6,886,718.00 still outstanding. The plaintiff sent a number of reminders and finally a legal notice to the defendants, but no further amount was paid to him.  It has also been alleged by the plaintiff that despite successful completion of the project by him in June 1996, the possession of the project was not taken over by the defendants.  Due to this reason, the plaintiff was forced to incur heavy overhead expenses towards the maintenance and security of the project. 

 

6.        In the above background, this Suit has been filed for recovery of Rs.7,853,818.00, being the outstanding amount of the 14th and 15th running bills and the balance retention money, and a sum of Rs.5,000,000.00 on account of damages suffered by the plaintiff due to the breach of contract committed by the defendants.  While this Suit was pending, the plaintiff passed away whereafter his legal heirs (the present two plaintiffs) were substituted as plaintiffs in his place. 

 

7.        The service on Defendant No.1 (the Province of Sindh) was held good in March 2000, whereafter the learned A.A.G. kept representing defendant No.1 on every date of hearing, but no written statement was filed on behalf of defendant No.1. After granting many opportunities, defendant No.1 was debarred on 16.03.2001 from filing the written statement. Defendant No.2 (the Senior Member Board of Revenue, Government of Sindh) filed his written statement, wherein it has been alleged that no completion certificate was received by defendant No.2 from the Engineer ; payment of the balance retention money or the 14th and 15th running bills to the plaintiff was not recommended by the Engineer ; the project was still incomplete ; the possession of the project was handed over by the plaintiff neither to the Engineer nor to the  “user” ; it was the plaintiff who caused heavy losses to the Government  ;   the project was to be completed within 18 months as per the Agreement, but the same was incomplete even after ten    years ;  and that the plaintiff is not entitled to the amounts claimed in this Suit.

 

8.        In view of the pleadings of the parties, the following nine issues were settled by the Court on 27.05.2002 :

 

“ 1.     Whether the defendants are entitled to withhold the payment of the balance amount of 14th and 15th bills of the plaintiff due to reasons or grounds stated in para 2 of the written statement ?

 

  2.      Whether NESPAK, through letter dated 12.06.1998, had recommended for the payment to the plaintiff of the balance of Retention Money, if so, its effect ?

 

  3.      Whether the work was executed in pursuance of the terms of the contract ?  If so, on what date ?

 

  4.      Whether the building was ready for handing over the possession of the constructed bungalows by the plaintiff to the defendants ?  If so, when and to what effect ?

 

  5.      Whether any portion of the work carried on under the contract was affected ?  If so, to what extent and its   effect ?

 

  6.      What is the effect on the above suit of the letter dated 16.05.1998 written to the plaintiff by defendant No.2 ?

 

  7.      Whether the plaintiff is entitled to recover damages from the defendants as stated in para 13 of the plaint, if so, what should be the quantum thereof ?

 

  8.      Whether the plaintiff has no cause of action to file the above suit ?

 

  9.      To what relief, if any, the plaintiff is entitled ?  ”

 

9.        In support of their case, the plaintiffs examined two witnesses, the present plaintiff No.1 (the widow of the deceased plaintiff) as     PW-1, and an Engineer of NESPAK as PW-2.  PW-1 produced both     the Letters of Award as Exhibits P/3 and P/5, the Agreement as Exhibit P/4, letters / recommendations by the Engineer as Exhibits P/8, P/9  and P/14, demands / letters / notices  by the plaintiff as Exhibits P/6, P/12, P/13, P/15, P/16 and P/20, defendant No.2’s  letters admitting liabilities with promises to settle the same, as Exhibits P/7, P/10, P/17 and P/21, Minutes of the Meeting presided over by the Additional Commissioner-I, Sukkur,  as Exhibit P/11, letters by the Executive District Officer (E.D.O.), Works & Services Department, Sukkur, confirming amounts lying for payment to the plaintiff, as Exhibits P/18 and P/19. All the aforementioned documents produced by PW-1 were exhibited.  Both the Plaintiffs’ witnesses were cross-examined by the learned A.A.G. on behalf of defendant No.1. Thereafter, a number of opportunities were granted to defendant No.2 to cross-examine the plaintiffs’ witnesses, but defendant No.2 failed to do so. By Order dated 25.05.2011, defendant No.2 was debarred from cross- examining the plaintiffs’ witnesses, and further, the side of both the defendants was closed as they did not produce any witness. 

 

10.      Mr. H. A. Rahmani, the learned counsel for the plaintiffs, submitted that the evidence on record has established that the deceased plaintiff performed his agreed part of the contract and there was no breach of the Agreement on his part.  He further submitted that the project was completed by the plaintiff in June 1996, which was confirmed not only by defendant No.2 himself vide Exhibits P/10 and P/21, but also by the Engineer vide Exhibit P/14 and by the Additional Commissioner-I, Sukkur, in the Meeting (Exhibit P/11) held on 28.02.1998. The learned counsel also submitted that in any case the defendants had admitted their liabilities time and again and had promised to pay the amounts claimed by the deceased plaintiff.  In support of his submissions, the learned counsel referred to all the relevant documents produced by the plaintiffs in their evidence, and also to the depositions and cross-examinations of both the witnesses.  He argued that the deceased plaintiff was entitled to receive without any delay the amounts claimed by him towards the 14th and 15th running bills and the balance retention money in view of the successful completion of the project by him, the confirmation thereof by defendant No.2, the Engineer and the Commissioner, Sukkur, the acknowledgement of liabilities by the defendants and their promise to settle the same.  Mr Rahmani contented that the claim for damages by the plaintiffs is fully justified in view of the facts and circumstances of this case. 

 

11.      Mr. H. A. Rahmani argued that (i) the defendants did not produce any evidence at all, (ii) the pleadings of defendant No.2 cannot be treated as a substitute of the defendants’ evidence (defendant No.1 having not filed its written statement), (iii) the written statement of defendant No.2 has no value in the absence of supporting evidence, (iv) PW-1 was not confronted regarding the claim of 14th and 15th running bills, the balance retention money, and particularly the damages, and (v) PW-2 / the Engineer was also not confronted regarding the scrutiny of bills and recommendations of payments made by him.  In the end, Mr. Rahmani submitted that, without prejudice to his contention that the contents of the plaint and the entire evidence produced by the plaintiffs have remained unrebutted, the plaintiffs are entitled to a decree as prayed by them in view of the unequivocal and categorical admissions and promises made by the defendants. 

 

12.      Ms.  Afsheen Aman, the learned State Counsel appearing for both the defendants, submitted that the main issue in this Suit is the issue No.3 ; namely, “ Whether the work was executed in pursuance of the terms of the contract ? If so, on what date ?  ”.  According to her, the findings on the other issues will depend on the finding of this issue.  She submitted that, under Clause 1(iv) of the Letter of Award (2nd Part)  (Exhibit P/5), the project was to be completed by the plaintiff within a period of 18 months.  She further submitted that the time of 18 months for completing the project was of the essence of the contract, and by not completing the project within the stipulated time, the plaintiff committed breach of the contract.  She further submitted that the Suit is barred by limitation as it was filed in the year 2000, whereas according to the plaintiffs’ own case, the project was completed and the amounts became due and payable in the year 1996.  The last contention of the learned State Counsel was that, by not producing the evidence and by not confronting the plaintiffs’ witnesses, the burden to prove never shifted on the defendants, as the plaintiffs themselves have failed to prove their case or to discharge the burden of proof which was on them.

 

13.      After perusing the pleadings of the parties, examining the evidence on record and hearing the learned counsel, my findings  on the issues involved in this Suit are as under :

           

ISSUES No.1, 2, 3 and 4 :

 

14.      The first four issues are inter-linked, therefore, they are being dealt with together. It would be advantageous if these issues are again reproduced here for the sake of convenience and ready reference :-

 

(1) Whether the defendants are entitled to withhold the payment of the balance amount of 14th and 15th bills of the plaintiff due to reasons or grounds stated in para 2 of the written statement ?

 

(2)  Whether NESPAK, through letter dated 12.06.1998, had recommended for the payment to the plaintiff of the balance of Retention Money, if so, its effect ?

 

(3)  Whether the work was executed in pursuance of the terms of the contract ? If so, on what date ?

 

(4) Whether the building was ready for handing over the possession of the constructed bungalows by the plaintiff to the defendants ? If so, when and to what effect ?

 

 

15.      The contention of the learned State Counsel that the main issue in this Suit is the issue No.3 and the findings on the other issues will depend on the finding of issue No.3, appears to be correct.  Therefore, I will first deal with issue No.3.  For deciding issue No.3,  the most relevant documents are  Exhibits  P/10,  P/11 and P/21, which are discussed separately. Exhibit P/10 is a letter dated 20.11.1997 which was addressed by defendant No.2 to the Commissioner Sukkur Division. The entire contents of Exhibit P/10 are of extreme importance and significance, and as such the same is reproduced below :- 

 

“ CONSTRUCTION OF REVENUE STAFF COLONY SUKKUR

 

The Contractor to whom the work of the subjected scheme was awarded has intimated that the work of the project is complete in all respects excepting the energization. The Contractor has also requested this office to take over the possession of the scheme referred to above.  The Board of Revenue is of view that the possession cannot be taken over un-till and un-less the clarification is sought from you regarding completion of the project. The energization work for which an amount of Rs : 1.300 Mln : was provided, under the revised PC-I has been disbursed to you through PLA Cheques previously.  You have informed that the amount so far released would not be sufficient for the purpose of energization, you are therefore requested to intimate the figures of amount required for the purpose referred to above.  The NESPAK authorities have also requested to come in contact with you and get the amount included in the re-revised PC-I including the liabilities of Contractor which is under preparation.

 

In view of the facts stated above the undersigned is directed to request you to intimate the present status of the project so that the taking and handing over process of the project may be intimated and got finalized. ”

 

            (Emphasis added)

 

 

16.      Exhibit P/10 issued by defendant No.2 establishes many crucial and important facts, such as, defendant No.2 had acknowledged that the plaintiff had intimated him before 20.11.1997 (the date of Exhibit P/10), about completion of the project in all respects except “energization”, and had also requested defendant No.2’s  office  to take over possession of the project ; defendant No.2’s  office  “was of the opinion”  that possession of the project cannot be taken over unless the Commissioner Sukkur Division gives “clarification” regarding completion of the project ; funds were disbursed / provided to the Commissioner by defendant No.2 for the energization work ; the Commissioner had informed defendant No.2 that the said funds were insufficient for the energization work ; defendant No.2 requested the Commissioner to let him know the amount required by the Commissioner for the “energization work”, so that taking / handing over process of the project could be initiated and finalized ; the Engineer was also requested by defendant No.2 to co-ordinate with the Commissioner for calculating the amount ; and the PC-I of the project had been  “re-revised ”.

 

17.      It is important to note here that nowhere was it mentioned in the Agreement nor was it ever agreed by the parties that the Commissioner Sukkur Division, and/or any other person, will give his clarification or confirmation regarding completion of the project, or that handing / taking over of the project was subject to any “clarification” by the Commissioner Sukkur Division.  In fact, there was no role or say of the Commissioner Sukkur Division in the Agreement.  Only the Engineer was appointed by the defendants vide Letter of Award dated 20.09.1990 (Exhibit P/3), which formed an integral part of the Agreement.  Therefore, not taking over possession of the project by defendant No.2 on the pretext that a “clarification regarding completion of the project ” was required from the Commissioner Sukkur Division, was unjustified as it was beyond the scope of the Agreement.  The other vital fact that has transpired from Exhibit P/10 is that the “energization work” was not the part of the Agreement, nor was it the responsibility of the plaintiff, as the funds for this purpose were not only disbursed / released by defendant No.2 to the Commissioner Sukkur Division, but defendant No.2 also enquired from him about the additional amount required by him to complete the energization work. 

 

18.      A perusal of Exhibit P/10 further reveals that PC-I of the project was  “re-revised ”  by defendant No.2.  In this context, I refer to Exhibit P/3 (the Letter of Award  dated 20.09.1990, which was an integral part of the Agreement) issued by defendant No.2, whereby the plaintiff was required to execute the remaining project subject to approval of the modified PC-I of the project by the relevant Government authorities and the plaintiff’s  acceptance of the revised price of the remaining work of the project. The plaintiff accepted the revised price, whereafter the Agreement (Exhibit P/4) was executed by the parties.  Vide Exhibit P/5, it was confirmed by defendant No.2 that the required approval of the modified PC-I for the project had been obtained. The documents executed by defendant No.2 show that the original PC-I for the project was modified, and the necessary approval for the said modified PC-I was obtained by defendant No.2.  It is to be noted that there was no provision in the Agreement for re-revision of the modified PC-I.  Therefore, the defendants had no right to “re-revise ” the modified PC-I unilaterally and without the consent of the plaintiff, or in delaying / refusing taking over the project on this ground.  

 

19.      After issuance of Exhibit P/10 by defendant No.2 to the Commissioner Sukkur Division, a meeting was held on 28.02.1998 which was attended by the Additional Commissioner-I Sukkur Division, the Engineer, the plaintiff, and the representatives of WAPDA and Sui Southern Gas Company. The Minutes of this meeting are on record as Exhibit P/11, paragraph 3 whereof is reproduced below because of its relevance :

 

 “ 3.     The Administrative Officer, Board of Revenue, Sindh has already informed the Project Manager NESPAK that the payment could not be made to the contractor unless the Revised PC-I was not approved by the Planning and Development Department.  The work of Colony is complete   in all respects.  However the remaining work could only        be finalised after the outstanding bills of the contractor       are paid ”.

 

(Emphasis added)

 

Exhibit P/11 leaves no doubt that it was acknowledged and recorded in the above meeting that the project had been completed by the plaintiff  “in all respects”,  and also that the bills of the plaintiff were outstanding.  The “remaining work”  mentioned in Exhibit P/11 had no concern with the plaintiff, as it pertained to the electric and gas works as mentioned in paragraphs 4 and 5 of Exhibit P/11. 

 

20.      Exhibit P/21 is even more relevant and important.  It was addressed on 16.09.1997 by the Administrative Officer of the Board of Revenue, Sindh, to the Additional Chief Secretary (Dev.), Government of Sindh, Planning and Development Department. The last two paragraphs of Exhibit P/21 read as under :-

 

“ Further on account of exclusion of items, additional works and increase of Electric and Gas connection charges the scheme still remained un-operationalize as yet, though the construction works have been completed by the Contractor.  The Commissioner Sukkur and our Consultant have also confirmed that the Construction work is completed in all respect excepting energization of Electric, Gas and Water connection. 

 

In the light of facts stated above, the Board of Revenue requests that the case may kindly be re-considered as the subjected project has been completed in all respect excepting the Electric, Gas and Water internal works and liabilities of Contractor. ”

 

            (Emphasis Added)

 

This document (Exhibit P/21) further establishes that the defendants had fully acknowledged the fact of completion of the project by the plaintiff in all respects.

 

21.      Exhibits P/10, P/11 and P/21 discussed above were produced by PW-1 in her evidence.  Exhibits P/10 and P/21 were issued and signed by the Administrative Officer of the Board of Revenue, Sindh.  Exhibit P/11 (the Minutes)  was also produced by PW-1.  During her cross-examination, PW-1 was not confronted by the defendants regarding the contents of any of these Exhibits or about the genuineness thereof.  No suggestion was made to PW-1 that the project had not been completed by the plaintiff, or that the plaintiff’s  bills were not outstanding.  Therefore, the entire contents of Exhibits P/10, P/11 and P/21 produced by the plaintiffs and the implications thereof against the defendants, have remained unrebutted.

 

22.      With respect to the learned State Counsel, her contentions that the plaintiff was required to complete the project within a period of 18 months which was of the essence of the contract, and by not completing the project within the stipulated time, the plaintiff committed breach of the contract, do not appear to be correct. The project was completed by the plaintiff in June 1996.  Exhibits P/10 P/11 and P/21 were issued after June 1996 between the period from 20.11.1997 to 28.02.1998, wherein the Board of Revenue, the Engineer and the Additional Commissioner Sukkur Division, time and again acknowledged and confirmed that the project had been completed in all respects by the plaintiff in June 1996. Had the plaintiff really committed breach of the Agreement by not completing the project within the purported stipulated period of 18 months, the aforementioned acknowledgement and confirmation would not have been made / recorded. On the contrary, the alleged delay or breach on the part of the plaintiff would have been recorded in the Minutes (Exhibit P/11), or protests would have been made by the defendants through correspondence. Admittedly, no such correspondence or evidence has been produced by the defendants.  On my query, the learned State Counsel conceded that no specific date for completion of the project was mentioned in the Agreement (Exhibit P/4), there was no other agreement between  the parties, Exhibit P/5 showing completion period of 18 months was not signed by the plaintiff, and Exhibit P/5 was not an integral part of the Agreement as it was issued by defendant No.2 subsequent to the Agreement.

 

23.      In view of the admissions and acknowledgements made by the defendants regarding completion of the project by the plaintiff in all respects in June 1996, the unrebutted evidence produced by the plaintiffs, and no evidence at all by the defendants in rebuttal, I have no hesitation in holding with regard to issues No.3 and 4 that the project was executed by the plaintiff in pursuance of the terms of the Contract in June 1996, and that the project was ready for the handing over of possession by the plaintiff to the defendants in June 1996. 

 

24.      The Engineer (NESPAK), vide letter dated 12.06.1998 (Exhibit P/14), confirmed to defendant No.2 about completion of the project by the plaintiff “in June 1996 as per their scope of work”, and recommended the payment of Rs.2,019,468.00 to the plaintiff towards the balance retention money.  It was also confirmed in Exhibit P/14 by the Engineer that the 15th running bill of the plaintiff had been verified. By earlier letters dated 27.10.1996 (Exhibit P/8) and 20.02.1997 (Exhibit P/9), the Engineer had confirmed to defendant No.2 that the 14th and 15th running bills of the plaintiff had been scrutinized and were found to be in order.  Through these Exhibits P/8 and P/9, the Engineer had recommended payment of Rs.4,273,292.00 and Rs.1,561,158.00 to the plaintiff towards the  14th and 15th running bills, respectively.  Exhibits P/8, P/9 and P/14 issued by the Engineer / PW-2 were produced by PW-1 in her evidence. During their cross-examination, neither of PW-1 or PW-2 were confronted by the defendants regarding the contents of any of these Exhibits or about the genuineness thereof.  No suggestion was made to any of these witnesses that the 14th and 15th running bills of the plaintiff were not scrutinized or recommended by the Engineer, or that the Engineer had not recommended the payment of the balance retention money to the plaintiff.  The entire contents of Exhibits P/8, P/9 and P/14 produced by the plaintiffs and the implications thereof against the defendants, have also remained unrebutted. 

 

25.      By letter dated 01.02.2003 (Exhibit P/18), the Executive District Officer (E.D.O.), Works & Services Department, Sukkur, directed the District Officer of the same office to intimate him about the payment of the outstanding bills and retention money to the legal heirs of the deceased plaintiff. It was observed in Exhibit P/18 by the said E.D.O. that the bills of the plaintiff had been finalized.  By another letter dated 14.07.2003 (Exhibit P/19), the same E.D.O. informed plaintiff No.1  (PW-1) that the District Law Officer, Sukkur, had suggested payment to the legal heirs of the deceased plaintiff, and that the amounts of Rs.4,366,677.00 and Rs.2,019,468.00 were lying with the said E.D.O.’s Department and the Board of Revenue, Hyderabad, respectively, for payment to the legal heirs of the deceased plaintiff.  It is to be noted that both the aforementioned letters were issued by the E.D.O. after filing of this Suit.  Both these letter (Exhibits P/18 and P/19) were produced by PW-1 in her evidence. During her cross-examination,  PW-1 was not confronted by the defendants regarding the contents of any of these Exhibits or about the genuineness thereof.  No suggestion was made to PW-1 that the amounts mentioned therein were not promised to be paid to the plaintiffs. The entire contents of Exhibits P/18 and P/19 produced by the plaintiffs and the implications thereof against the defendants have also remained un-rebutted.

 

26.      The Minutes (Exhibit P/11) produced by PW-1 also talk about non-payment of the plaintiff’s bills.  Moreover, the Board of Revenue vide Exhibit P/17, admitted in March 2000 that the balance amounts    of the 14th and 15th running bills of the plaintiff were pending  “which could not be disbursed for want of revision of scheme”. A commitment was made by the defendants in Exhibit P/17 that “the liabilities will be cleared as soon as possible, the PC-I is re-revised, funds released by the Government ”.  In paragraph 2 of his written statement, defendant No.2 has admitted that certain amounts against the 14th and 15th running bills of the plaintiff could not be paid due to non-preparation of re-revision of PC-I, and that the delay was caused due to the fault of the Engineer. I have already held that PC-I of the project or the scheme could not be re-revised by the defendants unilaterally and without the consent of the plaintiff.  In any case, if there was any fault on the part of the Engineer or if there was a dispute between the defendants and the Engineer, the defendants had no right or justification to delay or withhold the payment of the pending bills of the plaintiff. 

 

27.      In view of the recommendations of the Engineer, confirmation and commitment by the E.D.O., and admission of liabilities by the defendants, the defendants had no right to withhold the payment of the balance amount of the 14th and 15th running bills of the plaintiff, and the reasons / grounds stated in paragraph 2 of defendant No.2’s written statement for withholding the said payment, are not tenable.  This is my finding on issue No.1.  Regarding issue No.2 as to whether or not the Engineer had recommended the payment of the balance retention money to the plaintiff, the answer is in the affirmative.

 

ISSUE No.5 :

 

28.      Exhibits P/10, P/11 and P/21 discussed above have proven that the plaintiff had completed the project in all respects in June 1996, which was acknowledged and recorded by the defendants. I have also given my findings to this effect.  This issue, that is, whether any portion of the project was affected ; if so, to what extent and its effect, is therefore answered in the negative.

 

ISSUE No.6 :

 

29.      In the letter dated 16.05.1998 (Exhibit P/7) addressed to the plaintiff, defendant No.2 had confirmed that according to him the “certified amount ” of the 14th and 15th running bills was Rs.5.8340 million, and after a part payment of Rs.0.9671 million, the outstanding amount was Rs.4.8639 million.  It was promised in this letter by defendant No.2 that the balance amount of the 14th and  15th running bills will be cleared upon release of funds by the Finance Department.  The effect of Exhibit P/7 is that the plaintiff’s claim was admitted by defendant No.2 himself to the extent of Rs.4.8639 million. The amounts claimed by the plaintiff towards his outstanding 14th and 15th running bills are Rs.4,273,292.00 and Rs.1,561,158.00, respectively, and Rs.2,019,468.00 towards the balance retention money, total amount being Rs.7,853,818.00. I have already held that not only has the entire evidence produced by the plaintiffs remained unrebutted, but also that the defendants have admitted their liabilities and had promised to settle the outstanding amount payable to the plaintiff.  This issue is, therefore, answered in the above terms. 

 

ISSUE No.7 :

 

30.      This issue is regarding the damages claimed by the plaintiff, and the quantum thereof. In view of the acknowledgements and admissions by the defendants, the Engineer and the Commissioner regarding completion of the project in all respects by the plaintiff in June 1996, and my findings on issues No.1 to 4, the responsibility of the plaintiff came to an end in June 1996.  However, possession of the project was not taken over from him by the defendants.  Nowhere has it been alleged by the defendants that the project was abandoned by the plaintiff after completion, nor was any suggestion made to this effect by the defendants to PW-1. Moreover, during her cross-examination, PW-1 was not confronted by the defendants that the plaintiff’s claim of incurring overhead expenses towards the maintenance and security of the project after its completion, was false.  The fact of not taking over possession after completion of the project has also been admitted by the defendants, and such fact also stands proved through the unrebutted evidence produced by the plaintiffs.  It is also an admitted position that the plaintiff started demanding the settlement of his 14th and 15th running bills and payment of the balance retention money immediately upon completion of the project.  The unrebutted evidence produced by the plaintiff has established that the entire amount claimed by the plaintiff was withheld by the defendants on such grounds which were not agreed by the parties and were beyond the scope of the Agreement.  Thus it has also been established that, by not taking over possession of the project in June 1996 upon its completion by the plaintiff in all respects and by not paying the admitted outstanding amounts of the plaintiff’s  14th and 15th running bills and the balance retention money, the defendants committed a deliberate and wilful breach of the Agreement. 

 

31.      After struggling for almost four years, the plaintiff was constrained to file this Suit in the year 2000 which is pending adjudication since about 13 years.  During this period, the plaintiff kept on suffering and he finally died on 02.08.2001 due to Cardio Respiratory Failure.  After his death, his legal heirs / the present plaintiffs are still pursuing this matter and are waiting for the legitimate claim of the plaintiff.  The admitted facts that, between February 1997 to March 2000, the defendants on several occasions admitted their liabilities and promised to settle the outstanding bills of the plaintiff, are sufficient to prove that the defendants kept on committing a wrong by withholding the admitted and legitimate claim of the plaintiff illegally and without any justification. Had the outstanding bills been settled promptly by the defendants, the plaintiffs would have used, enjoyed or invested the amount, which was a huge amount considering the Pak Rupee value in the year 1996.  The money rightfully belonging to the plaintiffs has therefore been lying blocked since June 1996 due to the deliberate and wilful breach of contract committed by the defendants. In the plaint signed and sworn by the plaintiff and in the affidavit-in-evidence of PW-1, who is the widow of the original plaintiff, an amount of Rs.5,000,000.00 has been specifically claimed on account of damages suffered by the plaintiffs.  During her cross-examination, PW-1 was not confronted at all regarding the claim of damages.  Thus, the claim of damages has also remained unrebutted. I, therefore, hold that the plaintiffs are entitled to damages.  Accordingly, a sum of Rs.2,500,000.00 is granted to the plaintiffs towards their claim of damages, which in my humble opinion, is a reasonable compensation. 

 

ISSUE No. 8 :

 

32.      Regarding the cause of action of this Suit, I hold that cause of action for filing this Suit is clearly apparent from a bare perusal of the plaint, and also in view of my findings on the other issues.

 

33.      Before dealing with the last issue, I would like to refer to the objection raised by the learned State counsel that this Suit is barred by limitation.  No such issue was framed, nor was any such objection raised by defendant No.2 in his written statement.  Nevertheless, I may mention here that the Suit filed on 19.02.2000  was within time, as between February 1997 to March 2000, the defendants on several occasions admitted their liabilities and promised to settle the outstanding bills of the plaintiff.

 

ISSUE No. 9 :

 

34.      Defendant No.1 did not file its written statement. In his written statement, defendant No.2 has made important admissions regarding payment of the outstanding bills of the plaintiff. The evidence produced by the plaintiffs in support of their claim,  which has remained unchallenged and unrebutted, has proved that the defendants admitted their liabilities and promised to settle the outstanding bills of the plaintiffs.  The defendants did not produce any evidence to disprove the plaintiffs’ claim.  In view of the findings on the issues involved in this case, I conclude that the plaintiffs have successfully proven their case.

 

35.      The Suit is, therefore, decreed jointly and severally against both the defendants in the following terms :

 

A.        The defendants shall pay to the plaintiffs within a period of thirty (30) days a sum of Rs.7,853,818.00 (Rupees seven million eight hundred fifty three thousand eight hundred and eighteen only) on account of the balance outstanding amount  of  the 14th and 15th running bills and towards the balance retention money, with profit thereon at the rate of 14% per annum with effect from June 1996 till the realization of the entire amount ;

 

B.        The defendants shall also pay to the plaintiff within a period of thirty (30) days a sum of Rs.2,500,000.00 (Rupees two million and five hundred thousand only) as damages, with profit thereon at the rate of 14% per annum with effect from the date of this decree till the realization of the entire amount ; and

 

C.        Costs of the Suit are also awarded to the plaintiffs. 

 

 

 

 

                                                                                               J U D G E

 

 

 

 

* Suit No.306 of 2000-Damages).doc /Judgment Single/Court Work/Desktop/ARK*