Partly allowed

P.Abdul Rasak v. the State of Kerala

Kerala HC5 Jul 2018WA/1103/2018

Case brief

AI extract

What is this about?

The Division Bench upheld the termination of the contractor's contract but set aside the order for recovery of tentative loss. The court directed the Government to re-visit the estimation, ascertain actual loss suffered after giving the contractor an opportunity to be heard, and pass a fresh order within six weeks.

What did the court decide?

Direction to re-visit Ext.P19 estimation, ascertain actual loss after giving the contractor an opportunity to be heard, and pass a fresh order within six weeks.

P.Abdul Rasak Vs the State of Kerala — Money Laundering | Kerala HC (2018)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE THE ACTING CHIEF JUSTICE MR.HRISHIKESH ROY

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THE HONOURABLE MR. JUSTICE A.K.JAYASANKARAN NAMBIAR

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THURSDAY, THE 5TH DAY OF JULY 2018 / 14TH ASHADHA, 1940

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WA.No. 1103 of 2018 IN WPC. 3664/2011

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AGAINST THE ORDER/JUDGMENT IN WP(C) 3664/2011 of HIGH COURT OF KERALA

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APPELLANT(S)/PETITIONER IN THE WPC

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P.ABDUL RASAK AGED 56 YEARS, S/O P.M MOIDEENKUTTY HAJI, (P.W.D CONTRACTOR), PULLIYIL MADASSERI HOUSE, P.O. MELMURI.

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BY ADVS.SRI.ESM.KABEER SRI.ABDUL MAJEED.N SRI.K.L.VARGHESE (SR.)

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RESPONDENT(S):

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THE STATE OF KERALA REPRESENTED BY THE SECRETARY TO GOVERNMENT, MINOR IRRIGATION DEPARTMENT, TRIVANDRUM-695001.

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THE SUPERINTENDING ENGINEER, MINOR IRRIGATION CIRCLE, KOZHIKODE-673001.

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THE EXECUTIVE ENGINEER, MINOR IRRIGATION DEPARTMENT, MALAPPURAM-676505.

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THE ASSISTANT ENGINEER,

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MINOR IRRIGATION SECTION, THIRURANGADI-676306.

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R BY GOVERNMENT PLEADER SRI.TEK CHAND

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THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 05-07-2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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HRISHIKESH ROY, Ag C.J. & A.K.JAYASANKARAN NAMBIAR, J.

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W.A.No.1103 of 2018

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-----------------------------------------------------Dated this the 5^th day of July, 2018

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JUDGMENT

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Hrishikesh Roy, Ag C.J.

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Heard Sri.K.L.Varghese, the learned counsel appearing for the appellant. Also heard Sri.Tek Chand, the learned Government Pleader representing the respondents.

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The appellant, as the writ petitioner challenged Ext.P21 order dated 23.9.2010, whereby, the earlier order for termination of contract at the risk and cost of the petitioner was examined and reiterated, following the direction in W.P(C).37562/09. The Government, in the impugned order, observed that the department is nowhere responsible for the abandonment of the work and therefore, the responsibility vests on the contractor himself. Thus, the Ext.P5 representation of the appellant was rejected.

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The learned Judge, after due consideration of the challenge to the Ext.P21 order, opined that the contractor was heard in person and adequate reasons were assigned in the impugned order. The court also noted that the decision was taken without any element of arbitrariness. Thus, the court considered it to be inappropriate to interfere with the Ext.P21 order.

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While challenging the adverse verdict in the W.P(C).3664/11, the learned senior counsel refers to the Ext.P19 order of the Superintending Engineer. This order

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WA.1103/18

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shows that a tentative loss of Rs.1,37,32,572/- is found to be sustained by the Government and consequently, the contractor was directed to remit the same within 15 days, failing which, it was decided that the estimated sum would be recovered under the provisions of the Revenue Recovery Act. The senior counsel refers to the ratio in Kailash Nath Associates v. Delhi Development Authority reported in [(2015) 4 SCC 136], to contend that compensation can be demanded only for damage or loss suffered by the contracting party and it is legally impermissible to demand compensation, without determination of whether any damage was actually suffered or without final estimation of the damage. In other words, the argument of the counsel is that there cannot be tentative estimation of damage.

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On the other hand, the learned Government Pleader refers to the Ext.P14 judgment dated 20.3.2009 in W.P(C).9071/09, which reflects that the contractor had earlier challenged the Ext.P13 agreement, which provided for termination of contract at his risk and cost. But this challenge was not entertained by the learned single Judge who opined that such issues can only be decided by the civil court. When the aggrieved contractor then challenged the decision and filed the W.A.No.1162/09, the Division Bench under the Ext.P15 judgment dated 30.9.2009, opined that instead of driving the appellant to civil court, it would be just and proper to permit him to approach the Government and get the issue adjudicated.

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WA.1103/18

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Since no further appeal was preferred against the above W.A. judgment, the same become final and thereafter, the appellant filed Ext.P16 representation before the Government, which led to the Ext.P19 finding of the Superintending Engineer, determining the tentative loss of Rs.1,37,32,572/-.

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Following the above determination, the contractor filed W.P(C).7013/10, wherein, the learned Judge directed reconsideration of the Ext.P19 determination and thereafter, the impugned Ext.P21 order was passed on 23.9.2010.

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What is apparent from Ext.P21 order is that the Government did not determine the actual loss sustained by them, if any, and to what extent. While we see nothing wrong with the decision to terminate the contract for delay in execution and abandonment of the work, the determination of tentative loss is unacceptable. Therefore our scrutiny in the present appeal is confined to the validity of the estimated loss in the Ext.P19 order. As noted earlier, the recovery demand is made on the basis of the estimation of tentative loss and there is no final determination as to whether any loss was actually suffered and if so, the extent of the actual loss. Thus, the amount mentioned in Ext.P19 could not have been fixed in an arbitrary manner, without indication of the basis to show how the loss figure was estimated.

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In the above circumstances, while upholding the learned single Judge's order, to the extent it sustained the decision of the authorities to order termination of the contract at the risk and cost of the contractor, we deem it appropriate to

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WA.1103/18

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direct that the Ext.P19 estimation should be re-visited. The Government should therefore determine whether any actual loss was sustained on re-arrangement of the contract in question and if so, the actual loss suffered on account of the termination of the contract must be ascertained. However, final determination should be made only after due opportunity is provided to the contractor and after hearing him. Fresh order in terms of this direction should accordingly be passed within a period of six weeks. The recovery proceedings, if any, can be pursued only thereafter. The writ appeal is ordered accordingly.

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Sd/-

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HRISHIKESH ROY ACTING CHIEF JUSTICE

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Sd/-

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A.K.JAYASANKARAN NAMBIAR

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JUDGE

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kkb.

P.Abdul Rasak v. the State of Kerala

Case brief

What is this about?

What did the court decide?

P.Abdul Rasak v. the State of Kerala

Case brief

What is this about?

What did the court decide?

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