1 2fa467.03.odt IN THE HIGH COURT OF JUDICATURE AT BOMBAY NAGPUR BENCH AT NAGPUR FIRST APPEAL NO.467/2003 1. Vidarbha Irrigation Development Corporation, Nagpur through its Executive Director, having its office at Sinchan Seva Bhavan, Civil Lines, Nagpur. 2. The Superintending Engineer, Upper Wardha Project Circle, Amravati. 3. The Executive Engineer, Khadakpurna Project Division, Deolgaon – Raja, Dist. Buldhana. .....APPELLANTS ...V E R S U S... 1. Vishwanath Ranganthrao Ghuge, aged 47 years, Occ. Business, r/o Saikrupa, Plot No. 87, Ahisa Nagar, Jalna Road, Aurangabad. 2. State of Maharashtra through the Collector, Buldhana. ...RESPONDENTS ------------------------------------------------------------------------------------------- Mr. Uday Arun Gosavi, Advocate for appellants. Mr. Harish D. Dangre with Mr. R. N. Ghuge, Advocates for respondent No.1. Mr. A. G. Mate, A.G.P. for respondent No.2. ------------------------------------------------------------------------------------------- CORAM:- ANIL L. PANSARE AND RAJNISH R. VYAS, JJ. DATE OF RESERVING THE JUDGMENT :- 07.08.2026 DATE OF PRONOUNCING THE JUDGMENT :- 24.09.2026 JUDGMENT (Per: Anil L. Pansare, J.) The present appeal has been preferred by the Vidarbha Irrigation Development Corporation, Nagpur (hereinafter referred to as “VIDC”), being aggrieved by the judgment and decree dated 21.03.2003 passed by the learned Civil Judge, Senior Division, Buldhana in Special Civil Suit No.79 of 2000. By the said judgment and decree, the learned Trial Court decreed the suit and held the appellants- 2026:BHC-NAG:11137-DB 2 2fa467.03.odt original defendant Nos.1, 3 and 4 liable to pay an amount of Rs.16,21,59,813/- to respondent No.1-original plaintiff. The parties, hereinafter, shall be referred to by their original nomenclature. 2. The case of plaintiff, in substance, is that his tender for the work of excavation and filling of the cut-off trench and embankment of the earthen dam for the left flank R.D. 130 M to 660 M and right flank R.D. 1740 M to 2070 M of the Khadakpurna Project was accepted by the defendants and a work order was issued to him on 29.03.1995. During the execution of the said work, a second tender was invited for excavation and filling of the cut-off trench and embankment of the earthen dam for the left flank R.D. 660 M. The said tender was accepted by letter No.370/97 dated 02.12.1997 and a corresponding work order was issued. 3. The plaintiff further states that, during the progress of the aforesaid work, he received a fax message calling him for negotiations in respect of excavation and filling of the cut-off trench and embankment of the earthen dam for the left flank R.D. 840 M to 1200 M. Negotiations were held on 04.02.1998. According to the plaintiff, the departmental authorities thereafter instructed him to proceed with the work which was the subject matter of the negotiations. A proposal in that regard was forwarded by the Superintending Engineer on 20.03.1998 to the Chief Engineer, VIDC, Nagpur, for approval. The 3 2fa467.03.odt Executive Engineer also instructed the plaintiff to execute the work from chainage 540 M to 1248 M, along with excavation of the foundation of the spillway on both flanks. 4. The plaintiff's case further is that, during the execution of the work, the Government of Maharashtra transferred the Khadakpurna Project to VIDC. The VIDC thereafter invited a tender for the entire project, with the stipulation that the work already completed would be included and the site would have to be handed over to the new agency. The Department, therefore, sought an assurance from the plaintiff. By letter dated 01.06.1999, the plaintiff undertook to hand over the site on 30.06.1999, subject to the condition that, before such handing over, the work executed by him would be jointly measured and the amount payable therefor would be released. According to the plaintiff, he and his representatives remained available at the site for the purpose of joint measurement, but despite assurances given by the defendants, the measurements were not undertaken. 5. The plaintiff accordingly contended that, since the Department proposed to hand over the site to a new agency without first measuring the work already executed and making payment therefor, he would suffer substantial loss. He expressed his readiness to abide by the undertaking dated 01.06.1999, but sought an order restraining the defendants from handing over the suit site until the joint 4 2fa467.03.odt measurement was completed and the amount payable to him was determined and paid. 6. The suit was initially instituted seeking a decree of perpetual injunction. Subsequently, the plaint was amended and a claim for recovery of the amount allegedly due to the plaintiff was incorporated. In the course of the proceedings, the High Court directed that joint measurements of the disputed work be undertaken and that the measurements be recorded under the supervision of Shri S.K. Joshi, retired Executive Engineer, who was appointed as Court Commissioner. Pursuant thereto, joint measurements were undertaken and the entries were recorded in the Measurement Book. The plaintiff, however, maintained that, despite the joint measurement and the recording of the measurements, the defendants were not accepting the same and were not releasing payment for the work executed by him. 7. According to the plaintiff, certain discrepancies and adverse remarks were recorded while undertaking the joint measurements. In particular, while recording the measurements on pages 25 and 26 of Measurement Book No.200 in respect of excavation of the cut-off trench in soft strata, a remark was made describing the excavation as excavation of the cut-off trench in the borrow area and stating “Not for payment”. A similar remark was made in respect of the portion from R.D. 1500 M to 1680 M. The plaintiff disputed these 5 2fa467.03.odt remarks. His case was that excavation in a borrow area could be undertaken according to convenience, including as regards its shape and depth, whereas excavation of the cut-off trench had to be undertaken in a defined manner. According to him, he had excavated the cut-off trench in soft strata to a depth of 6.00 M. 8. The plaintiff similarly relied upon the excavation in the O.F. portion, contending that the same was required to be carried out in a defined manner and involved approximately 50% soft rock, whereas excavation in a borrow area would not ordinarily involve excavation in soft rock. It was further pointed out that, while preparing the estimate and inviting tenders for the balance work beyond R.D. 849 M, the banking work had been proposed to be undertaken from the excavated spoils of the cut-off trench and the foundation of the spillway and that such material had not been indicated as a borrow area. 9. On the basis of the aforesaid position, the plaintiff requested the Court Commissioner to consider, for the purpose of payment, the quantity of 62,660 CUM recorded on pages 23 and 26 of Measurement Book No.200 and the quantity of 51,792 CUM recorded in paragraph 277 of Measurement Book No.2. According to plaintiff, the said quantities represented work actually executed by him and were liable to be taken into account while determining the amount payable. 6 2fa467.03.odt 10. The plaintiff accordingly claimed that, for the work executed and recorded in the Measurement Books from R.D. 840 M to 1238 M on the right flank and from R.D. 1510 M to 1740 M of the Khadakpurna Project, he was entitled to an amount assessed at Rs.20,21,59,853/-. He further stated that the claim had been worked out on the basis of the use of machinery and the assurance allegedly extended by the defendants that the additional work from R.D. 849 M to R.D. 1230 M, R.D. 1238 M to R.D. 1410 M and R.D. 1510 M to R.D. 1740 M would either form part of the original contract relating to R.D. 640 M to R.D. 840 M or, at the very least, would be paid for at the prevailing rates for the use of heavy earth-moving machinery, having regard to Clause 38 of the original contract. 11. The plaintiff therefore sought a decree for Rs.20,21,59,853/- jointly and severally against the defendants, together with future and pending interest at the rate claimed by him. He also sought an order restraining the defendants from handing over the suit site to any other person or agency until the amount claimed by him was fully paid. 12. The defendants contested the suit by filing its written statement at Exh.76. At the outset, it raised an objection to the jurisdiction and maintainability of the suit. It was contended that no statutory notice as contemplated by Section 80 of the Code of Civil 7 2fa467.03.odt Procedure, 1908 had been issued and, therefore, the suit was not maintainable. It was further contended that the suit, which had originally been registered as a Regular Civil Suit, ought to have been returned for presentation before the competent Court when the pecuniary jurisdiction exceeded Rs.25,000/-. According to the defendants, the plaint was thereafter registered afresh as a Special Civil Suit and, therefore, the suit had not been properly instituted. 13. The defendants also questioned the very basis of the plaintiff's claim for payment for the additional work. Its case was that there was no concluded contract in respect of the work claimed by the plaintiff in terms of Article 299 of the Constitution of India. According to VIDC, unless an authorised officer entered into a contract in the name of the Governor and the requisite work order was issued, no binding contractual relationship could arise in respect of the alleged additional work. It was therefore contended that oral or written assurances allegedly given by officers of VIDC, without sanction of the competent authority, could not bind the Corporation. In the absence of a concluded contract, neither the quantity of the alleged work nor the liability to make payment could be fastened upon the defendants. 14. The defendants further disputed the plaintiff's claim on the ground that the proposal for allotment of the work from R.D. 840 M to R.D. 1200 M had not received the requisite approval. It was pointed 8 2fa467.03.odt out that a proposal concerning R.D. 840 M to R.D. 1200 M had earlier been forwarded on 23.06.1997 and that the same was rejected by the Chief Engineer, VIDC, Nagpur on 23.03.1998. According to VIDC, the plaintiff was aware of the rejection and nevertheless continued to execute the work. It was contended that the plaintiff had stopped the work in June 1998, and that when the departmental officers took measurements by the end of August 1998, the value of the disputed work was found to be only about Rs.1,53,000/-. 15. The defendants further relied upon the subsequent correspondence between the parties. According to it, although the plaintiff had stopped the work in June 1998, he again commenced work on 25.11.1998. An Assistant Engineer Grade-I reported on that date that the plaintiff was carrying out unauthorised excavation in the foundation of the project. The concerned defendant No.4 thereafter addressed a letter dated 30.11.1998 to the plaintiff by registered post with acknowledgment due, which was received by him. The plaintiff replied by letter dated 21.12.1998. According to VIDC, the correspondence demonstrated that the plaintiff was fully aware that he was undertaking the work without a concluded contract. It was therefore contended that his claim of having executed work to the extent of Rs.9,42,38,338/- could not be accepted. VIDC also maintained that the plaintiff had repeatedly been instructed to stop the unauthorised work. 9 2fa467.03.odt 16. The defendants also disputed the plaintiff's computation of Rs.20,21,59,853/-. It pointed out that, in paragraph 10 of the plaint, the plaintiff had himself referred to his final payment in respect of the disputed work as being about Rs.5 crores, whereas after amendment of the plaint, prayer clause (a) sought a decree for Rs.20,21,59,853/-. VIDC submitted that the plaintiff had also stated that he had been called for negotiations on 09.02.1998 and that a proposal had thereafter been forwarded by defendant No.3 to the Chief Engineer, VIDC. However, the said proposal concerning the work from R.D. 840 M to R.D. 1200 M was rejected on 23.03.1998. It was therefore contended that the plaintiff's claim that he continued to execute the work despite such rejection was not supported by the record. VIDC further questioned the possibility of the plaintiff having executed work worth such a substantial amount during the short period between 04.02.1998 and 23.03.1998. 17. The defendants also raised an objection regarding the non-joinder of the subsequent agency, M/s Ketan Construction Co. It was pointed out that the plaintiff was aware that the work order had been issued in favour of the said agency, yet the agency had not been impleaded as a party. According to the defendants, the plaintiff could not maintain a suit seeking recovery of Rs.20,21,59,853/- on account of alleged breach of agreement and alleged work from R.D. 849 M to R.D. 1740 M without impleading the agency to whom the work had 10 2fa467.03.odt subsequently been entrusted. The claims towards interest and damages on account of alleged idling of machinery and staff were also denied. VIDC further denied that the work had been completed within the extended period or that final payment remained outstanding for want of joint measurement. It was asserted that additional work up to R.D. 990 M had been sanctioned under Clause 38 of the agreement. 18. The defendants did not dispute that a proposal had been forwarded by the Superintending Engineer on 20.03.1998 for approval of the Chief Engineer, VIDC, Nagpur. It also did not dispute that the plaintiff had submitted an undertaking dated 01.06.1999 to hand over the site on 30.06.1999, or that the work had subsequently been entrusted to a new agency. However, it denied that the Executive Engineer had the authority to orally direct the plaintiff to execute unauthorised work. The defendants maintained that the project had been transferred to VIDC on 01.04.1997 and that the work had commenced on 08.05.1997. It also denied that the entire project had been put to tender on the basis that the work already completed would be included and the site would thereafter be handed over to the new agency. The allegation that the defendants had deliberately avoided joint measurement was also denied. 19. It was further the case of defendants that the joint measurement was undertaken pursuant to the orders passed by 11 2fa467.03.odt the High Court, Bombay, Bench at Nagpur in Civil Revision Application No.1180/1999 on 17.12.1999, and that the measurements were taken by Shri S.K. Joshi, retired Executive Engineer and Court Commissioner, and recorded in the Measurement Book. According to defendants, the entries were made after the plaintiff had accepted the measurements and, therefore, there was no basis for subsequently disputing the same. After the joint measurement, the site was handed over to M/s Ketan Construction Co., whose tender had already been accepted and work order issued on 01.06.1999. VIDC further relied upon the proceedings concerning the same project initiated by the plaintiff's elder brother in the name of M/s Ambarwadikar and Co., Aurangabad. The said proceedings, being Writ Petition No.2357 of 1999, were dismissed by the High Court with costs, and the challenge thereto before the Supreme Court by way of Special Leave Petition (Civil) No.9306 of 2000 did not result in grant of interim relief. 20. Lastly, the defendants relied upon the orders passed by the High Court in Civil Revision Application No.1180 of 1999 on 14.12.1999 and 17.12.1999. According to the defendants, those orders were intended only to preserve the existing position, which was liable to change after vacation of the injunction, and could not create any substantive right in favour of the plaintiff to claim payment for work which was unauthorised or otherwise not covered by a concluded contract. It was contended that payment could be made only for work 12 2fa467.03.odt which was duly authorised, periodically inspected and measured in accordance with the applicable procedure. VIDC therefore maintained that the remarks in the Measurement Book were justified, particularly since no item-wise payment had been agreed upon in respect of the interrelated works and there was no concluded contract governing the additional work. It was further asserted that the plaintiff had already been paid for the work from R.D. 660 M to R.D. 990 M and for the embankment work from R.D. 660 M to R.D. 840 M. According to VIDC, the plaintiff had also failed to furnish a clear calculation explaining how the amount of Rs.9,42,38,338/- was arrived at. In absence of the rates and the basis on which particular amounts were claimed for particular items of work, VIDC contended that the claim was vague, inconsistent and incapable of being sustained merely on the basis of the pleadings. 21. In view of the rival pleadings, the Trial Court framed various issues and answered the same in following manner. ISSUES FINDINGS 1 Does plaintiff prove that he has Exeucted the work as per work order dated 29.3.1995 and 21.12-1997 as alleged? In the affirmative 2 Does he further prove that as per work order, he has completed the work as alleged? In the affirmative 3 Does he further prove that the Work of Khadakpurna project of R.D. 840 M to 1238M on the right flank and from R.D. 1238 M to 1410 M is done by him as alleged? In the affirmative 13 2fa467.03.odt 4 Does the plaintiff further prove that it was obligatory to make final payment as per joint measurement? In the affirmative 5 Whether the suit is tenable? Yes 6 Whether the suit is bad for non joinder of necessary parties? No 7 Whether the suit is bad for non- compliance of mandatory notice? No 8 Do defendants prove that there was concluded contract, as alleged In negative on the representation to the respondent No.1 it created a concluded or implied contract. 9 Do defendants further prove that for allotment of the work, Change RD No.840 to 1200 M was rejected on 23.3.1998? Not valid rejection instantly and appears to be fabricated 10 Do defendants prove that amount claimed by the respondent No.1 is excessive and exaggerated, as alleged? No. 11 Do defendants prove that the respondent No.1s had carried out illegal and unauthorised work, as alleged? No. 12 Is respondent No.1 entitled to a decree for Rs.20,21,59,853/- as alleged? Proved to the extent of Rs.16,21,59,813/- 13 Whether the respondent No.1 is entitled for permanent injunction, as prayed for? No. 14 Whether order and decree? In terms of final order. 22. In the light of the aforesaid findings, we inquired with the defendants’ counsel as to whether the VIDC is challenging findings rendered by the Trial Court on all the issues. Mr.Gosavi, learned counsel for the defendants, initially answered in the affirmative. His argument was that the work was sublet by the plaintiff to one 14 2fa467.03.odt Mr.Vitthal Rangnath Ambarwadikar, the first witness examined by plaintiff. According to him, the provisions of the contract does not permit subletting the work without the permission of the defendants. 23. His attention was invited to admissions made by the Executive Engineer in cross-examination as also the proposal sent by the Executive Engineer to Superintending Engineer in respect of work done by the plaintiff. The defendants admitted that the work was executed by the plaintiff. 24. Mr. Gosavi has then restricted his challenge to the extent of the execution of additional work allegedly done by plaintiff on the count that plaintiff himself did not enter the witness box instead, the power of attorney holder was examined. Secondly, that the power of attorney was not registered and, therefore, inadmissible. Thirdly that the contract for alleged additional work was never executed between the parties. 25. Thus, the point that arises for our consideration is whether the Additional work was executed by the plaintiff and if yes, whether for want of express contract to that effect the plaintiff will be debarred from expecting payment for the additional work executed by him. 26. We have accordingly gone through the evidence of PW1, the power of attorney holder Mr. Vittal Rangnath Ambarwadikar. He 15 2fa467.03.odt deposed in tune with the plaint, giving all the details of the work done, which includes work of excavation, filling of cut off and trench and earthen dam for left flank RD 130 M to 660 M and right flank RD 1740 M to 2070 M of Khadakpurna Project. The work order was issued on 29.03.1995. The second work order was issued on 02.12.1997 for the work of left flank 660 M to 840 M. This work was sublet to PW1. The witness deposed that the defendants gave consent for carrying out the aforesaid work. The work was satisfactorily done and bills were paid. He deposed that additional work was done in terms of the orders issued by the defendants. The plaintiff received a fax message dated 04.02.1998 to commence the work from left flank RD 840 M to 1238 M (Exh. 118). According to the witness, the defendants directed him to continue with the work until formalities are completed. The parties negotiated on the rates for execution of the additional work. Plaintiff was given assurance that he will be paid at least at the rate applicable to second contract. The witness then deposed that the Superintending Engineer sent a proposal to the Chief Engineer for approval (Exh. 127). He further deposed that in April 1998, the Superintending Engineer and Assistant Chief Engineer visited the site of work. They inspected the work and asked the witness to continue with the work. He received part payment for the work done from RD 840 M to 1050 M. In November, 1998, he received the order to stop the work, which was the trigger point of the dispute. 16 2fa467.03.odt 27. In the cross-examination, defendants put up various questions. The witness answered that general power of attorney was registered because it was registered before Notary public. According to the witness, such registration is permissible. Clause 2 of the general power of attorney was referred to the witness, which refers to suits that were already instituted in Court. The cross-examination then proceeds on the point of execution of work. There is extensive cross-examination of the witness on this point, more importantly, by referring to the clauses of power of attorney. 28. That being so, the argument that the power of attorney is inadmissible, fails inasmuch as in the cross-examination, the defendants themselves have referred to various clauses of the special power of attorney and have also tested the credibility of the witness, who withstood the cross-examination. Thus, there is no substance in the contentions of the defendants that the power of attorney executed in favor of the first witness was not admissible. The argument is accordingly rejected. 29. Mr. Gosavi has then argued that in terms of the conditions of the contract, subletting work is not permissible unless consented by the defendants. On this point, we find that the first witness has deposed before the Court that the work was sublet to him under consent of the officials of the defendants. The officials of the defendants 17 2fa467.03.odt visited the site on multiple occasions, inspected the site, recorded their satisfaction as regards the quality of work and made part payments to the plaintiff. 30. Mr. Gosavi could not point out to us from the cross- examination or otherwise that defendants had ever objected to the execution of work by PW1. Though the work was executed by PW1, the payments under the contract were made to plaintiff. Thus, so far as the first two work orders are concerned, there appears sufficient evidence that the work was done by plaintiff either personally or through PW1. The same was within the knowledge of the defendants. The officials permitted PW1 to continue the work. In that sense, he was the best witness for and on behalf of plaintiff. He has deposed in the capacity of power of attorney of plaintiff. His evidence indicated that he had knowledge of the work right from the inception. The plaintiff, through the testimony of PW1, has then proved that the work allotted to plaintiff under first two work orders was successfully executed in terms of the conditions of contract. 31. So far as additional work is concerned, the most crucial evidence is the proposal dated 20.09.1999 sent by the Superintending Engineer to the Chief Engineer (Exh.129). The Superintending Engineer had submitted a proposal for approval of additional work done from 840 M to 1238 M. The communication indicates that for the additional earthen works, plaintiff Mr.Vishwanath Ghuge had sufficient machinery 18 2fa467.03.odt available at the site. Quotation from three contractors were called. Mr.Ghuge had quoted 17% above the rates for the existing contract. The necessary correspondence was made. However, the proposal for making payment to plaintiff was rejected. Accordingly, plaintiff was, vide communication dated 23.02.1998 issued by the Chief Engineer, directed to close the work. Despite such communication, the work continued for certain reasons, which are mentioned in the proposal, which includes the public oppose of Marathwada. The work was commenced by somehow resolving the public issue. According to the defendants, had earthen work from 1050 M onwards been stopped, it would have adversely affected the work of dam under question. Another reason was to complete the work within time. The excavated material was also reused in the work. Accordingly, proposal was sent for approval of earthen work from 840M to 1238M costing Rs.166.65 lakhs. 32. This communication speaks volumes about the manner in which the defendants have handled the project under question. It is evident that the additional work was executed through plaintiff without floating tender. The department, having realized mistake, instructed the plaintiff to stop the work. The defendant issued fresh tender and allotted the work to M/s. Ketan Construction Company. The work order was issued on 01.06.1999. The plaintiff requested for joint measurements. The same were, however, taken in terms of order dated 19 2fa467.03.odt 17.11.1999 in Civil Revision Application No.1180/1999. The joint measurements have been not disputed. 33. In this connection, our attention was invited by Mr. H. D. Dangre, learned counsel for plaintiff to the communication dated 09.03.1999 (Exh.193) issued by the Executive Engineer to plaintiff. It refers to the earthen work of Khadakpurna Dam and ancillary works. The plaintiff was called upon to remain present for final measurement. There is yet another letter, which is dated 07.03.1998 (Exh.206). This communication is made by Chief Engineer to plaintiff. The subject matter of communication is excavation and execution of earthen work for Khadakpurna project from RD 840 M to 1200 M. The Chief Engineer has refused plaintiff's quote of 17% above the existing rates. 34. This communication, if read with the evidence and the proposal sent by the Superintending Engineer, the only inference that will follow is that the additional work was executed by the plaintiff at the instance of the defendants. It is a different matter that the additional work was, for certain contingency, allotted without following the due procedure. This aspect is ratified by yet another letter dated 11.07.2000 issued by Executive Engineer to the plaintiff (Exh.182). The letter refers to the work of excavation from RD 840 M to 1740 M and other such work, saying that plaintiff had agreed to do additional work at the rates as agreed in the agreement No. B-1/2/97-98 i.e. original work. By the said letter, the claim made by the plaintiff for executing additional work 20 2fa467.03.odt was denied for various reasons, one of which was that he agreed to execute the work at the rates, the original tender/work was given. 35. Thus, the claim is denied, not on the ground that the plaintiff has not executed the additional work, but on the ground that the rates quoted were over and above the rates agreed and also for some more reasons. Such a communication at the hands of the defendant is a certificate in support of plaintiff's case that he has executed the additional work. 36. That being so, the plaintiff has proved that he has executed the additional work of Khadakpurna Project from RD 840 M to 1238 M on the right flank. 37. As regards measurement, pursuant to order dated 17.11.1999 passed in Civil Revision Application No.1180/1999, the joint measurements were taken and recorded in the measurement book. The same has been not disputed. The Trial Court considered these details and evidence to render a finding in favor of plaintiff. The defendants failed to show that the finding so rendered is not in consonance with the evidence placed before it. In other words, the Trial Court has correctly appreciated the evidence and rendered finding in favor of plaintiff. 38. Mr. Gosavi, learned counsel for defendants has then questioned the findings of the Trial Court on the point of assessment of 21 2fa467.03.odt the Trial Court as regards claim made by plaintiff towards idle machinery charges. The Trial Court, while allowing the claim, has assigned following reasons: “124. As to the point of claiming charges on account of valuable machinery and staff remaining idle from 1.9.1998 to 31.12.1999 excluding the period of 1.6.1999 to 30.6.1999, it is clear that the plaintiff has done the work, but joint measurements were not taken. The contractor is under obligation to follow up the action and rectify defects and to give post service. As the measurements were not taken by the defendants who were under obligation to take joint measurements, naturally, it caused the plaintiff to keep his machinery idle till the joint measurements taken. For this, defendants are liable. The plaintiff has given detailed account of keeping the machinery idle. He has charged as per the rates per hour. The particulars are given in exh.183. It is to note that in the agreement, it is prescribed that when contractor has to engage Government machinery, he has to pay hire charges as per the Government rates fixed per hour. In view of this fact, the plaintiff’s claim charging hourly rates for the period for which it was kept idle, appears to be justified. Had the defendants taken measurement on the day on which it was asked by plaintiff, he would have taken away his machinery, when he was given order to stop the work. Merely asking him to take away machinery on stopping the work is not sufficient. To cause him to take machinery, the defendants were under obligations to take joint measurements and while taking measurements, if any defect was pointed out, the plaintiff would have rectified it or corrected it. For that, he had to use his machinery. As the defendants did not do so, it will have to be said that the defendants caused the plaintiff to keep his machinery idle. He has given details for claiming damages over valuable machinery and staff remaining idle from the period 1.9.1998 to 31.12.1998 excluding the period of 1.6.1999 to 30.6.1999, which comes to Rs.4,17,69,054/-. In the circumstances, I also find this claim justified on account of non co-operation of the defendants No.1, 3 and 4, thus the plaintiff is entitled to claim the damages of Rs.4,17,69,054/-.” 22 2fa467.03.odt 39. As could be seen, the reason why the plaintiff was required to keep the machinery on site was to have joint measurements recorded. The delay on this count is attributable to defendants who have failed to explain the same. The terms of agreement prescribe hourly charges for engaging Government machinery by the contractor. The plaintiff applied similar norms while calculating the claim towards idle machinery charges. We do not find any error in such finding. If the Government machinery is to be engaged on hourly basis, the contractor will be justified in calculating claim on the same principle. 40. Put all together, the defendant/department was fully aware that the additional work was executed by the plaintiff in terms of the instructions given by the officials of the department. The contingency then existing was such that the department chose to not float a tender, but get the work done from the agency, readily available to execute the work. The proposal dated 20.03.1998, forwarded by Superintending Engineer seeking approval for additional work done by the plaintiff, was however, rejected by the Chief Engineer. 41. This rejection and the plea taken by the defendants that there was no concluded contract between the parties in respect of the additional work and that therefore, the defendants are not liable to make payment towards additional work will have to be tested in the light of the 23 2fa467.03.odt provisions of law, particularly the provisions of Indian Contract Act, 1872 (For short, “Act of 1872”). Section 10 of the Act of 1872 provides that all agreements are contract if they are made by free consent of the parties competent to contract for lawful consideration and with lawful object. Thus the essential ingredients for a valid contract are; (i) competent parties; (ii) free consent, (iii) lawful consideration and (iv) lawful object. Further, Section 2(e) of the Act says that every promise and every set of promises forming the consideration for each other is an agreement. Thus, when a person makes an offer to another and that offer is accepted by the other person, the offer becomes a promise as defined under the aforesaid provisions. The offer becomes a starting point for making an agreement. Section 3 of the Act provides that the communication of proposal, acceptance of proposal, revocation of proposal and acceptance respectively are deemed to be made by any of the act or omission of the party proposing, accepting or revoking, by which he intends to communicate the said proposal, acceptance or revocation or which has the effect of communicating it. Section 9 of the Act provides that the proposal or any promise, is made in words, the promise is said to be express promise. If such proposal or acceptance is made otherwise than in words the promise is said to be implied. Thus, the communication can be made orally or in writing or even by conduct. 42. In the present case, the evidence suggests that the offer/promise was made orally by way of instructions, which was 24 2fa467.03.odt converted into writing when part payment was released in favour of the plaintiff. In the case of Aloka Bose Vs. Parmatma Devi and Ors.; [(2009) 2 SCC 582], the Supreme Court held that sale agreement can be oral, if it is within the ambit of Section 10 of the Indian Contract Act. 43. We may also take note of Section 70 of the Act of 1872, which provides as under: “70. Obligation of person enjoying benefit of non- gratuitous act.— Where a person lawfully does anything for another person, or delivers anything to him, not intending to do so gratuitously, and such other person enjoys the benefit thereof, the latter is bound to make compensation to the former in respect of, or to restore, the thing so done or delivered. Illustrations: (a) A, a tradesman, leaves goods at B's house by mistake. B treats the goods as his own. He is bound to pay A for them. (b) A saves B's property from fire. A is not entitled to compensation from B, if the circumstances show that he intended to act gratuitously.” 44. Thus, when a person lawfully performs an act for another and such other persons enjoys the benefit thereunder, the latter is bound to make compensation to the former in respect of the act performed by him. That being so, where the work is done beyond the contract at the instance of the department and the benefits of the work has been availed by the defendant/department, it is bound to compensate the person who has executed the work. 45. In the present case, the defendants got the work done at the hands of plaintiffs by giving instructions. Part payment towards work 25 2fa467.03.odt done was also made. The defendants have availed the benefits of this work. The proposal sent certifies that the work under question was executed by the plaintiff. The payment, however, was not made to the plaintiff for the mistakes committed by the defendants and its officials. It is not the case of the defendants that this part of additional work has been done by M/s. Ketan Construction Company. 46. Mr. Gosai, learned counsel for defendants submits that in terms of Article 299 of the Constitution of India, the contract under question should be an expressed contract. He argued that oral contract is not permissible in law. 47. We are not impressed with this argument. On this point, a profitable reference can be had to the judgment in the case of Chaturbhuj Vitthaldas Jasani Vs. Moreshwar Parashram and Ors.; [1954 AIR 236] wherein the Court held as under: 29. That brings us to article 299 (1) of the Constitution. It states:- "299. Contracts – (1) All contracts made in the exercise of the executive power of the Union or of a State shall be expressed to be made by the President ... and all such contracts... made in the exercise of that power shall be executed on behalf of the President ... by such persons and in such manner as he may direct or authorise." The contention was that as these contracts were not expressed to be made by the President they are void. Cages were cited tons under the Government of India Acts of 1919 and 1935. Certain sections in these Acts were said to be similar to article 299. We do not think that they 26 2fa467.03.odt are, but in any case the rulings ,under section 30 (2) of the Government of India Act, 1915, as amended by the Government of India Act of 1919 disclose a difference of opinion. Thus, Krihsnaji Nilkant v. Secretary of State, ruled that contracts with the Secretary of State must be by a deed executed on behalf of the Secretary of State for India and in his name. They cannot be made by correspondence or orally. Secretary of State v. Bhagwandas(3) and Devi Prasad Sri Krihhna Prasad Ltd. v. Secretary of State held that they could be made by correspondence. Secretary of State V. G.T. Sarin & Company took an intermediate view and held that though contracts in the prescribed form could not be enforced by either side a claim for compensation under section 70 of the Indian Contract Act would lie. Province of Bengal v. S. L. Puri, took a strict view and held that even letters headed "Government of India" did not comply with, the rule in section 175 (3) of the Government of India Act, 1935. 30. The Federal Court was called upon to construe section 40 (1) of the Ninth Schedule of the Government of India Act, 1935. It held that the directions in it were only directory and not mandatory, and the same view was taken of Article 166 (1) of the present Constitution by this court in Dattatreya Moreshwar Pangarkar v. State of Bombay. 31. None of these provisions is quite the same as Article 299. For example, in Article 166, as also in Section 40(1) of the Government of India Act of 1935, there is a clause which says that "orders" and "instruments" and "other proceedings" "made" and "expressed" in the name of the Governor or Governor-General in Council and "authenticated" in the manner prescribed shall not be, called in question on the ground that it is not an "order" or "instrument" etc. 'made" or "executed" by the Governor or Governor-General in Council. It was held that the provisions had to be read as a whole and when that was done it became evident that the intention of the legislature and the Constitution was to dispense with proof of the due "making" and "execution" when the form prescribed was followed but not to invalidate orders and instruments otherwise valid. Article 299(1) does not contain a similar clause, so we are unable to apply the same reasoning here. 32. In our opinion, this is a type of contract to which Section 236(3) of the Indian Contract Act would 27 2fa467.03.odt apply. This view obviates the inconvenience and injustice to innocent persons which the Federal Court felt in J. K. Gas Plant Manufacturing Co., Ltd. v. The King. Emperor (3)and at the same time protects Government. We feel that some reasonable meaning must be attached to Article 299(1). We do not think the provisions were inserted for the sake of mere form. We feel they are there to safeguard Government against unauthorised contracts. If in fact a contract is unauthorised or in excess of authority it is right that Government should be safeguarded. On the other hand, an officer entering into a contract on behalf of Government can always safeguard himself by having recourse to the proper form. In between is a large class of contracts, probably by far the greatest in numbers, which, though authorised, are for one reason or other not in proper form. It is only right that an innocent contracting party should not suffer because of this and if there is no other defect or objection we have no doubt Government will always accept the responsibility. If not, its interests are safeguarded as we think the Constitution intended that they should be. 33. In the present case, there can be no doubt that the Chairman of the Board of Administration acted on behalf of the Union Government and his authority to contract in that capacity was not questioned. There can equally be no doubt that both sides acted in the belief and on the assumption, which was also the fact, that the goods were intended for Government purposes, namely, amenities for the troops. The only flaw is that the contracts were not in proper form and so, because of this purely technical defect, the principal could not have been sued. But that is just the kind of case that Section 230(3) of the Indian Contract Act is designed to meet. It would, in our opinion, be disastrous, to hold that the hundreds of Government officers who have daily to enter into a variety of contracts, often of a petty nature, and sometimes in an emergency, cannot contract orally or through correspondence and that every petty contract must be effected by a ponderous legal document couched in a particular form. it may be that Government will not be bound by the contract in that case, but that -is a very different thing from saying that the contracts as such are void and of no effect. It only means "that the principal cannot be sued; but we take it there would be nothing to prevent ratification, especially if that was for the benefit of Government. There is authority for the view that when a Government officer acts in excess of authority 28 2fa467.03.odt Government is bound if it ratifies the excess (see The Collector of Masulipatam v. Cavaly Venkata Narrainapah). We accordingly hold that the contracts in question here are not void simply because the Union Government could not have been, sued on them by reason of Article 299(1). 48. As could be seen the Supreme Court held that in a given case the Government officers who have to enter into variety of contracts every day and sometimes in an emergency, can execute contract orally or through correspondence. In such case one may argue that Government will be not bound by the contract but that by itself will not make contract void. The Court held that such a status will only mean, Principal cannot be sued. However, such contract could be ratified specially if it was for the benefit of the Government. 49. In the present case, the circumstances were such that in the interest of public, a decision was taken to instruct plaintiff to execute additional work. It is nobody’s case that this work was not for the benefit of the Government. In fact, the proposal sent indicates that not only time but also money has been saved and most importantly, the public grievance has been addressed. In the circumstances, the rejection of proposal at the hands of the Chief Engineer, is contrary to the law laid down in the aforesaid case. The argument therefore, that for want of concluded contract, the defendants are not bound to make payment is without any substance and stands rejected. 50. Original defendant Nos. 1, 3 and 4 had also raised objection about maintainability of the suit saying that notice under Section 80 of 29 2fa467.03.odt the Civil Procedure Code was not issued prior to institution of the suit. The Trial Court took note of the fact that the suit as initially filed by plaintiff was for perpetual injunction. The said suit was filed with leave of the Court. The suit, in such circumstance, is maintainable. The suit was later on amended and claim for recovery of amount made. The Trial Court held that the amendment made was for taking joint measurement. According to the Trial Court, the amendment was not based on new cause of action. The Trial Court also took note of the fact that the plaintiff had, prior to incorporating the amendment, given notice in respect of the proposed amendment to the defendants. In such circumstance and the plaintiff having taken leave of the Court while filing the suit for perpetual injunction, the Trial Court held that the suit was tenable and does not suffer from non compliance of statutory notice to the defendants. 51. Mr. Gosawi, learned counsel for defendants did not really pursued this part of the ground and, therefore, detailed discussion on the point is not necessary. Even otherwise, from the findings rendered by the Trial Court, it appears that the suit was instituted by plaintiff for perpetual injunction with leave of the court, which is permissible under Section 80 of the CPC. The Court further noted that the amendment incorporated is not based on separate cause of action and, therefore, notice under Section 80 of the CPC was not required. It appears that even otherwise, notice was issued by plaintiff to the defendants as 30 2fa467.03.odt regards taking joint measurement which was part of the amendment sought to the plaint and thus there is sufficient compliance of Section 80 of the CPC. 52. Mr. Gosavi did not point out to us the illegality or perversity in the finding so rendered by the Trial Court. That being so, we do not find any error in the judgment on the point of maintainability of suit for want of notice under Section 80 of the CPC. 53. The sum and substance of the above discussion is that the plaintiff has proved that additional work was executed by him and he is entitled for the payment for the work so done. The defendants, however, refused to pay the amount of additional work done by the plaintiff. He was, thus, left with no other alternative but to approach the Civil Court. The Trial Court decreed the same. The finding is mainly based on the correspondence made by the defendants-department, as also the evidence of its officials. The defendants were thus aware of the outcome of the suit. Despite such status, the suit was contested and the appeal preferred. Maybe, to come out of the departmental action that would have followed for allotting work without floating tender. By contesting the suit and filing the appeal, the officials who were responsible for allotting additional work ensured that they would retire by the time the judgment is delivered. The purpose of filing the appeal is thus served. The end result is that the liability of interest will be borne by public 31 2fa467.03.odt exchequer. This action requires deprecation. One of the ways is to recover the amount from the pocket of the erring officials. 54. We accordingly direct the Appointing Authority of the erring officials to inquire into the matter and recover the amount of interest payable to the plaintiff from the pocket of the erring officials but in accordance with law. 55. With the above observations, the appeal is dismissed. (Rajnish R. Vyas, J.) (Anil L. Pansare, J.) kahale Signed by: Kahale Designation: Senior Pvt. Secretary Date: 24/09/2026 17:33:41