Al Wakeelo
Your Digital Lawyer, Always on Duty
Initializing Secure Chambers
Your Digital Lawyer, Always on Duty
Initializing Secure Chambers
Petitioner: PAKISTAN RAILWAYS VS Respondent: JAVED NASIM & Co.
Court Name: Lahore High Court Judge(s): Munir A. Sheikh, Khalid Paul Khawaja Title: PAKISTAN RAILWAYS vs JAVED NASIM & Co. Case No.: Regular First Appeal No,226 of 1992 Date of Judgment:1993-11-24 Reported As: 1994 MLD 1992 Result: Appeal accepted
JUDGMENT
JUDGMENT ' MUNIR A. SHAIKH, J.---This appeal is directed against judgment and decree dated 23-7-1992 through which the suit filed by the respondent for recovery of an amount of Rs,44,83,039 has been decreed. 2. The facts of this case as disclosed in the plaint are that the respondent being an approved contractor of the appellant was allotted the work for repair/special repair under different acceptance notifications which were detailed in Annexure 'A' attached therewith. The nature of the work with regard to which the work was allotted as disclosed in para. 3 of the plaint was bituminous premix carpeting but the suit did not relate to the recovery of any amount done by the respondent in relation thereto. It was the work of seal coat also at the spot for which no rates were given, therefore, the respondent claimed the sued amount at the rate of Rs,400 per square foot for the said additional work and an amount of Rs,1,16,726 on account of hike in prices as the rates for bitumen were increased. 3. The suit was contested by the appellant by filing written statement in which correctness of the case as made out by the respondent/plaintiff in the plaint was disputed and it was denied that any such additional work was got done as alleged. Certain preliminary objections were also raised in the written statement which need not be repeated. The controversies arising from the pleadings of the parties were reflected in the following issues framed by the trial Court:--- (1) Whether the plaintiff has no locus standi and cause of action? OPD (2) Whether the suit is barred under the provisions of Partnership Act? OPD (3) Whether the plaintiff is estopped by his conduct from filing this suit? OPD
---
## Page 2
(4) Whether the suit is false and frivolous and the defendant is entitled to special costs if so to what amount? OPD (5) Whether the suit is bad in view of the preliminary objections Nos.3, 5, 7? OPD 4. In support of his case the respondent examined Muhammad Ali Bhatti son of Din Muhammad a Civil Engineer registered with the Pakistan Engineering Council as P.W.1, Muhammad Yousaf Salim son of Abdul Karim as P.W.2, Muhammad Ashraf, Record-Keeper DEN Workshop as P.W.3 and Muhammad Salim son of Mian Muhammad Din, Managing Partner of respondent firm examined himself as P.W.4. The documentary evidence produced by the respondent consists of Exh.P1 copy of notice/notification dated 2-9-1986 conveying the decision of the Railway for acceptance of tenders of the respondent. Exh.P2 copy of letter dated 20-5-1987 written by the respondent to Divisional Engineer, Workshop Railway, Mughalpura, Exh.P3 copy of reply dated 22-6-1987 to the said letter issued by the Divisional Engineer, Exh.P4 copy of letter dated 27-6-1987 written by respondent to Divisional Engineer Workshop, Exh.P5 copy of letter, dated 26-7-1987 from Divisional Engineer to respondent, Exh.P6 copy of letter dated 21-11-1987 from Divisional Superintendent Workshop to respondent, Exh.P7 copy of letter dated 28-1-1988 from respondent to Divisional Engineer, Exh.P8, copy of letter dated 2-1-1988 written by respondent to Divisional Engineer requiring him to make payment within seven days, Exh.P9, copy of letter dated 12-1-1988 from respondent to Divisional Engineer, Exh.P10 copy of letter dated 15-2-1988 from respondent to Divisional Engineer, Exh.P11 copy of letter dated 8-5-1988 from respondent to Divisional Engineer intimating him that they had approached the Wafaqi Mohtasib, Exh.P12 copy of letter dated 19-7-1988 written by respondent to Chief Engineer relating to the dispute about blacklisting the respondent-firm, Exh.P13 copy of report dated 22-8-1988 regarding space allowed to respondent for storing purposes, Exh.P14 copy of reply dated 9-4-1988 written by Ziaul Qamar, Deputy Chief Personnel Officer-H to show cause regarding departmental proceedings to be initiated against him, Exh.P15, copy of letter dated 9-12-1987 from Divisional Engineer to respondent, Exh.P16 copy of letter dated 9-1-1988 that the security of respondent-firm would be forfeited because the original work was not done properly, Exh.P17 copy of letter dated 13-2-1988 from Divisional Engineer to respondent to rectify the original work within three days, Exh. P18 copy of order dated 2-5-1988 through which the Department forfeited the security deposited by the respondent, Exh.P19, copy of letter dated 1-6- 1988 written by the Divisional Engineer to respondent for making reference to any authority that the original work was not satisfactorily done, Exh.P20 a document which related to MA. Rahim Contractor (learned counsel for the parties agreed that this document is not relevant), Exh.P21 copy of letter dated 10-8-1988 from Divisional Engineer to respondent to vacate the land given to him for storing purposes, Exh.P22 dated 22-8-1988 regarding delivery of possession of vacated land by the Contractor, Exh.P23 copy of parawise comments dated 21-5-1988 submitted by the appellant in regard to complaint made by respondent. Exh.P24 to Exh.P26 copies of correspondence from respondent regarding renewal of registration, Exh.P27 dated 29-11-1988 showing that the cases filed by the Railway Police against the respondent regarding encashment of security had been withdrawn, Exh.P28 document dated 2-12-1990 evidencing security deposited, Exh.P29 copy of application dated 24-4-1988 regarding transfer of inquiry, Exh.P30 to Exh.P44 certified copies of documents which were produced in evidence in some other case still pending disposal before another Court regarding similar matter between another Contractor and the Railway and Exh.P45 copy of registration of respondent-firm. 4. In defence the appellant examined Jamil Ahmad Sheikh, Assistant Engineer, South Railway, Lahore as D.W.1, Muhammad Akram son of Ghulam Haider, Divisional Engineer, Workshop, Pakistan Railway, Mughalpura as D.W.2 and Ziaul Qamar son of Rashid Ahmad Chaudhry, Deputy General Manager, Pakistan Railways as D.W.3. The documentary evidence produced by the defendant is as follows:---
---
## Page 3
(1) Exh.D1 list of various contracts awarded to the respondent from 1982 to 1987; (2) Exh.D2, general power of attorney executed by Muhammad Saleem Arabi and Javed Naseem Arabi in favour of Mian Muhammad Saleem; (3) Exh.D3, work orders issued by the appellant regarding the works granted to respondent; - (4) Exh.D4, bills sanctioned by the Railway for payment of various amounts for the work done by the respondent; (5) Exh.DS, copy of instructions regarding procedure tot claiming escalation; (6) Exh.D6, list of contracts awarded to respondent in 1982-83; (7) Exh.D7, list of contracts awarded to respondent in 1984-85; (8) Exh.D8 a letter written by contractor; (9) Exh.D9/P5 dated 26-7-1987 intimating the respondent that his claim for recovery of the disputed amount for seal coat was baseless; (10)Exh.D10/P6, a letter from appellant to respondent pointing out the defects in the original work done; (11)Exh.D11/P7, a letter from respondent to appellant that the suit had already been filed; (12)Exh.D12, a letter from appellant to respondent to remove defect within two days at his own risk otherwise the same would be got done at his risk and cost; (13)Exh.D13, a letter written by the appellant for registration of case against the respondent for encashment of security fraudulently; (14)Exh.D14, a letter from Divisional Superintendent; (15)Exh.D15, special conditions of contract relating to 1982; (16)Exh.D16 to Exh.D25, special conditions of contracts granted for the disputed period; (17)Exh.D26, copy of letter dated 27-8-1986 written by respondent to appellant; (18)Exh.D27, copy of tender documents required to be submitted by the contractor before awarding the contract; (19)Exh.D28, copy of order, dated 22-10-1986 accorded formal sanction for increasing limit from 2.5 lacs to Rs,5 lacs. (20)Exh.D29 and Exh.D30 dated 27-12-1986 and 2-1-1986 regarding grant of sanction for increasing the limit; (21)Exh.D31, copy of one of the works orders, dated 29-9-1986 of the year 1986; and (22) Exh.D32 copy of bill dated 29-9-1986 submitted by respondent for payment of the work done and the payment made. 4-A. In rebuttal the respondent produced copy of statement of Jamil Ahmad Sheikh as Exh.P46, copy of another statement of Jamil Ahmad Sheikh as Exh.P47 and copy of statement of Ziaul Qamar as Exh.P48. 5. Since Issue No,6 was the crucial issue and the decision of the main controversy raised by the respondent centred around the decision of the said issue, therefore, the trial Court dealt with and decided the said issue first before recording fmdings on the other issues. Under issue No,6 after appraisal of abovementioned evidence produced by the parties it was held that the original work executed by the respondent-firm was in accordance with the agreement and that he had also executed the work of seal coat for which he was entitled to recover the sued amount. Under issue No,1 it was held that since the respondent had executed the work and the amount for the same had been refused to it, therefore, the firm had locus standi and cause of action to file the suit. Under issue No,2 it was held that the document regarding registration of the firm had been produced in evidence, therefore, the suit was maintainable on its behalf through Managing Partner, as such, the said issue was answered against the appellant. Under issue No,3 it was held that the respondent- firm was not estopped from recovering the amount merely because it had signed the certificate in the measurement book for payment of final bill without any objection because had it not done so it
---
## Page 4
would have been refused even the payment regarding scheduled items. It was held as regards Issues Nos.4 and 5 that no evidence was produced by the present appellant, therefore, they were answered in favour of the plaintiff. Through judgment dated 23-71992 passed by the trial Court the suit was decreed which has been challenged in this appeal. 6. We have undertaken close scrutiny of documentary as well as oral evidence produced by both the parties with the assistance of learned counsel for the parties. The dispute related to payments regarding additional work of seal coat and the amount claimed on account of escalation qua the said amount. It is also common ground between the parties that in the original contracts awarded to the respondent for repair/construction of roads item of seal coat was not included, therefore, it can safely be held that satisfactory execution of the original work for which the contract was given, would not by itself have given any cause of action or a right to the respondent to claim any payment in respect of additional work allegedly executed by him on the request/asking of respondent at the spot unless it was proved that the order/contract may be oral were in fact issued and awarded to him in accordance with law to do the said additional work of seal coat and the same was in fact done. 7. The onus was on the respondent to establish that the additional work for seal coat was got done by the respondent as alleged. In the plaint it was not mentioned as to which particular officer of the respondent issued him instructions/orders or asked him at the spot to execute the additional work of seal coat. Even it was not disclosed that for the works included in the contracts he had been made payments which were received after signing a certificate that no other amount was due and that the said certificate was signed by the contractor under compulsion, for, otherwise he would have been refused the payments for the work of even scheduled items. In our view it was necessary to mention the same in the pleadings if any benefit of the same was sought to be derived to avoid a finding that the respondent-firm was estopped from claiming any amount for alleged additional work of seal coat as payments regarding all the contracts to which his additional work allegedly related had been received after signing a certificate by the contractor that he had received full payments in full and final satisfaction of his claim and nothing remained due. 8. The only evidence on which the respondent was relying was the oral evidence of witnesses examined by him. Muhammad Ali Bhatti P.W.1 stated that he had seen the disputed road in Mughalpura area and over the carpeting seal coat had also been done. According to his opinion as an Engineer, the surface of the normal carpeting was normally rough and there were chances of the collection of water over it due to which bitumenous carpeting might have become loose, therefore, in order to avoid damage to the carpeting, seal coat over the same was usually done. In the cross-examination he was not in a position to tell the name of the roads about which he had given the evidence. He could not tell the number of roads which he allegedly saw when suggested that the number of those roads could be one, two or five. He stated that he could say nothing. According to him he saw the roads six months before his statement was recorded on 20-4-1991 and it may be mentioned here that the dispute relates to all the roads about which works were executed from 1982 to 1987 for which different contracts were admittedly awarded to the respondent. He admitted that when he inspected the roads nobody from Railway Department was present. 9. Muhammad Yousaf Saleem P.W.2 is another contractor and according to his evidence he was the Railway Contractor since 1967. He admitted that whatever additional work was to be got done Addendum Slip was to be prepared and thereafter the payments were to be made. According to him this Addendum Slip was to be signed by the Contractor of the Engineer Incharge at the spot which was also to contain the measurements. He in the first instance admitted that the Contractor
---
## Page 5
was to execute only that work which was mentioned in the work order and Addendum Slip but then voluntarily said that the other additional work if asked orally were also to be executed. 10. Muhammad Ashraf P.W.3 is the Record-keeper DEN Workshop who produced the abovementioned documents. In the cross-examination he admitted that according to the record the work of seal coat was not included in the contracts even to the respondent from time to time. He admitted that at the time of receiving the payments under those contracts the respondent did not raise any objection that the payments regarding any item or additional work done by him had not been made. He stated that the measurements regarding the work executed by the Contractor had to be recorded in the measurement book which was required to be signed by the Divisional Engineer and the Contractor and the payments were to be made according to the entries in the measurement book regarding the work mentioned in it. 11. Muhammad Saleem P.W.4 is the Managing Partner of the respondent-firm who in his statement stated that the firm was granted contract of bitumenous carpeting. He stated that the additional work for seal coat regarding the same as additional work was also done which sometime was described as flushing. He admitted that the work regarding seal coat was not included in the tender documents but the same was got done because it was required at the spot as it was to be done on hot carpeting which was done at the asking of the Department. According to him it was got done because the same was necessary to improve the riding quality of the road and to make it water-proof by closing the holes. According to him some payments for some work of seal coat was made but regarding others the payment was withheld regarding which he had filed the suit. In the cross-examination he admitted that the contracts for carpeting were awarded from 1982 to 1987 and the first work regarding seal coat was got done in 1983. He admitted that in none of the work orders issued by the Department seal coat was mentioned and stated that since the seal coat was not included in the scheduled item, therefore, no work order regarding the same had been issued. He was not in agreement with his own witness that for every additional work Addendum Slip was to be issued. He could not say as to when for the first time he made complaint for nonpayment of the work of seal coat. He, however, admitted that for the works mentioned in para. 4 of the written statement the payments were made to him regarding seal coat at the rate of 193 per square feet which according to him was accepted by him because he was compelled to do so because his other payments had been withheld. He admitted that when the first payment was made to him it did not include the payment for seal coat work though the same had been executed. He stated that he made complaint about non-payment with regard to work of seal coat but did not report to any Department and stated that the complaint was again made on 20-5-1987. 12. In the impugned judgment the learned trial Court mostly relied upon the admission contained in the written reply dated 21-5-1988 (Exh.P23) submitted by the appellant before Wafaqi Mohtasib on behalf of the appellant that the Contractor laid a thin layer of sand and bitumen over the carpeting and the statement of Jamil Ahmad Sheikh, Assistant Engineer, South Railways that the riding quality of the road was better and the plea that each work must precede the formal order in writing stood negated by documents on record which shows that in certain cases the work started and the formal order followed thereafter to hold that the additional work of seal coat could also be got done before issuance of formal order as substantial work and the same was in fact done, therefore, the respondent was entitled to the recovery of the amounts claimed by him. 13. We have examined Exh.P23 and fmd that a portion of the said document has been used in isolation to construe it as an admission in favour of the respondent by the Department that the work of seal coat as claimed by the respondent as substantial work had been done at the spot. This document if read as a whole clearly shows that the amount claimed by the respondent for additional work of seal coat was resisted having not been executed and it was stated that nothing was due from the department to respondent. A plea was made that the original work done by the
---
## Page 6
respondent was defective and in spite of repeated demands the same was not rectified by it. As regards claim for seal coat para. 3 of the comments is reproduced below as a whole, a portion of which has been referred to by the learned trial Court in the judgment as mentioned above to construe and hold that the same was an admission on the part of the respondent that the seal coat was done:--- "The contractor agency raised baseless claims for payment of the so-called seal coat. The contractor laid a thin layer of sand and bitumen (pre-mix) over the carpeting to conceal the defective work and raised a claim for payment of seal coat when he was asked to rectify the discrepancies which in fact, was not only time-barred but also not covered under any claims of agreement. The civil suit in this regard is pending decision in the Court of Mr. Muhammad Rauf Ahmad Sheikh, Civil Judge, Lahore." ' This para. If read alongwith preceding paragraphs make it clear that it was being urged on behalf of the appellant that since the original work had not been executed properly according to specification which was found to be defective and when the appellant was asked to rectify the same, he in order to conceal the defects laid a thin layer of sand and bitumen (pre-mix) over the carpeting to raise false claim for payment of seal coat about which this suit was pending. By no stretch of imagination and principle regarding interpretation of documents it could be held that it amounted to an admission on the part of the appellant that the work of seal coat as claimed by the respondent was got done and had been done. It is well-established law regarding admissions that if any statement made by a party to a suit, was to be construed as admission the same should be clearly unqualified and has to be taken into consideration as a whole. The learned trial Court thus was not justified in construing the said paragraph of the reply given by the appellant before Wafaqi Mohtasib as an admission on its part, that the work of seal coat was got done at the spot as claimed by the respondent. This is apart from the fact that the admission has never been held to be a conclusive evidence of the fact admitted. The onus was on the respondent to prove his case and in doing that he could not take benefit of the weaknesses of the case of the defendant. Merely because one of the appellant's witness stated that the riding quality of the roads in question was better was neither an admission that the seal coat had been done nor it was in any manner evidence regarding proof of the work of seal coat having been got done as alleged. 14. Reverting to the stand taken by the respondent that according to the procedure laid down by the appellant regarding grant of works and contracts which provide that before work was got done it must precede a written order which was shown to have been issued after the work had already started in respect of certain contracts, it may be mentioned that the case of the respondent is not advanced in any manner rather it has to fail on that account. The case of the appellant in fact was that according to the procedure, before the start of work the work order was to be issued after acceptance of tenders and if any work was required to be done in addition thereto the same could be done but the requirement was that Addendum Slip was to be issued, measurements were to be recorded in the measurement book regarding the said additional work and subsequently formal order was also to be issued in order to complete the formalities. In the case of the contracts for original work the actual work though had started as is evident from different documents placed on the record and thereafter formal orders for the said work were issued and thus formalities completed. If the work of seal coat had also been got done on oral instructions as alleged the same should have likewise followed by a formal written order as had been done regarding the original contracts and if the same had not been issued the respondent should have asked the Department to issue the same if he had been in fact asked to do the additional work and had done as alleged but there is an evidence that he asked for issuance of such an order from which an inference can safely be raised that no such work of seal coat was either got done or actually done at the spot.
---
## Page 7
15. It has been proved on record which fact was also admitted by Mian Muhammad Saleem in cross-examination that the original contracts were granted from 1982 to 1987 out of which regarding contracts awarded in 1984 of which mention was made in Para. 4 of the written statement, the work of seal coat was also mentioned expressly for which payment was made of which the additional work of seal coat though had been done but the payment for the same was refused. If the payment regarding the seal coat which was allegedly got done in respect of the contract granted in 1982 had already been refused, he would have not accepted the contracts subsequently granted to him in 1983 about which also his complaint was that the work of seal coat was got done but the payment refused. He should have at that time raised an objection that regarding the previous additional work of seal coat the payment had not been made, therefore, the mention of seal coat work should be mentioned expressly in the subsequent contract. The mention of seal coat work in the contracts granted in 1984 for which payment was made and accepted by the respondent without any objection for the previous non-payments for the same work in the previous contracts was sufficient to hold that in fact neither seal coat work was got done as alleged at the spot by the appellant nor the same had been done in fact. 16. The matter does not end here. In the contracts awarded to the respondent subsequent to 1984 no express mention was again made regarding award of contract for seal coat as additional work previously as alleged in that regard, he should not have accepted the work order to do the work of carpeting even, and if had been asked orally to do the work of seal coat he would not have done so on the ground that previously a similar work was got done from him but no payment was made. This conduct of the respondent furnishes strong evidence of the fact that in fact neither the additional work of seal coat was got done from him nor in…
Read the unabridged text and precedent citation network on Al Wakeelo Legal Research Platform.