Food Corporation of India vs Rameshwarlal Agrawal

This appeal is preferred under Section 96 of Code of Civil Procedure, 1908 against the judgment/decree dated 24-4-1997/28-4-1997 passed by the

7th Additional District Judge, Bilaspur in Civil Suit No. 15-B/96 wherein the said court awarded a sum of Rs.2,19,687.61 for demurrage charges and

Rs.19,986.40 for wharfage against the respondent and adjusted the counter claim of respondent to the tune of Rs.29,442.49. This appeal is filed by the

appellant/plaintiff for proper calculation of amount /enhancement.

Food Corporation of India, Bilaspur filed a suit for recovery of Rs.3,46,774.38 with interest thereon against the respondent/defendant Rameswarlal

Agrawal on the allegations that he was awarded handling and transporting contract by FCI Depot at Vishrampur for two years i.e., from 2-4-1980 to

1-4-1982. The work was not satisfactory as contractor failed to supply adequate number of labourers for unloading wagons and doing other incidental

work and further failed to supply adequate number of trucks for transportation of materials unloaded from the wagons at the rail head to the Depot of

the Corporation. The contractor was asked to improve the work but he did not pay any heed to it. Contractor was also required to comply with the

provisions of Employees Provident Fund Act, but he did not comply with the mandatory provisions of the said Act.

From 12-9-1981 the contractor completely failed to carry out the work under the contract and due to this 20 wagons with wheat/sugar and other

materials were detained since 4-9-1981 causing heavy loss to Corporation and it had to pay the demurrrage charges as the Corporation had to get

wagons cleared. This was done at the risk and cost of the contractor. The corporation carried out the entire handling and transporting work

departmentally by engaging casual labourers on emergency basis and it was at the risk and cost of the contractor. This was done from 1-9-1981 till the

end of complete period of the contract. During this period the Corporation had to pay Rs.2,91,687.61 towards railway demurrage charges and

Rs.19,986.40 towards wharfage charges. The corporation also incurred extra expenditure of Rs.35,100.37 for the work. The trial Court though

decreed the suit but miscalculated the amount of demurrage charges which is paid by the Corporation. Again, deduction on account of counter claim is

not legal.

Learned counsel appearing for the appellant submits as under:

i) The amount of demurrrage charges is Rs.2,91,687.6, but the trial Court calculated it as Rs.2,19,687.61 which requires modification.

ii) The trial Court though agreed to the loss suffered by the appellant, failed to decree the amount of extra expenditure to the tune of Rs.35,100.37.

iii) The trial Court failed to take into account the fact that the deduction from the bills of the respondent were statutory in nature, therefore, counter

claim ought to have been rejected.

iv) The trial Court erred in law and failed to see that the appellant is entitled to deduct a sum of Rs.3800/- which was security deposit.

v) The trial Curt erred in law and failed to see that deduction of Rs.3000/- was made from the bills in respect of Employees Provident Fund.

I have heard learned counsel for the appellant/Food Corporation of India and perused the record of the court below.

From the evidence of PW/1 P.L. Jaiswal and PW/3 Narendra Saggar, it is established that the contractor failed in providing sufficient number of

labourers and trucks at the site/rail head and letters (Ex.P/19 to P/29) was issued to him but the work was not improved. From the evidence of

contractor Ramleshwarlal Agrawal, DW/1, it is established that he has stopped the work before completion.

The trial Court discussed the issue at length and the finding of the trial Court regarding failure on the part of the contractor is based on proper

appreciation of oral and documentary evidence and this court has no reason to interfere with the same. As the contractor failed to discharge his part

of contract, the remaining part of contract was executed departmentally and due to delay in unloading railway wagons, the Corporation had to pay

demurrage charges.

As per receipt of payment of demurrage charges, total sum comes out to more than Rs.2.9 lakhs but the appellant/Corporation claimed Rs.2,91,687.61

which is based on receipt of demurrage charges and there is no document contrary to receipts filed by the Corporation. Though the trial court

recorded the finding that the Corporation is entitled to recover the demurrage charges from the Contractor, but there is miscalculation of demurrage

charges.

Looking to the documents (Ex.P/8 to P/16), demurrage charges is more but allowed to the tune of Rs.2,91,687.61. Looking to the oral and

documentary evidence, the trial Court awarded Rs.19,986.40 on account of wharfage charges and this court has no reason to disturb the same. From

the evidence of both sides, it is not established that 20 labourers of contractor had worked for more than 60 days, therefore, the trial Court opined that

the provisions of Employees of Provident fund are not applicable and depositing any amount for that fund was not required.

The finding of the trial Court is based on the evidence adduced by both sides and, therefore, deduction made on this count by the Corporation is not

legal and counter claim of contractor was allowed on this count. Counter claim of Rs.29,424.49 of the Contractor was substantiated vide documents

Ex. D/9 to D/21 which is based on the documents which is also not liable to be interfered with by this Court.

In view of the above, the appellant/Food Corporation of India is entitled to receive demurrage charges Rs.2,91,687.61 and Rs.19,986.40 for

wharfage charges, the total which comes out to Rs.3,11,674.01 (round off Rs.3,11,674/-) against the contractor. The amount of counter claim to

Rs.29,424.49 shall be deducted from the said amount and after deduction it comes out to Rs.2,82,249.52.

Accordingly, the appeal is partly allowed and decree is modified as under.

i) Respondent Rameshwarlal Agrawal will pay Rs.2,82,249.52 to the appellant/Food Corporation of India.

ii) Respondent Rameshwarlal Agrawal to bear cost of the appellant through out.

iii) Counsel fee, if certified be calculated as per certificate or as per Schedule whichever is less.

iv) A decree be drawn up accordingly.