Food Corporation of India and Others vs Chander Shekhar and Others

Rakesh Garg, J.—Plaintiff-Girdhari Lal filed the instant suit seeking recovery of a sum of Rs. 3,21,850 along with future interest from the date of institution till its realization stating that the amount in question was deposited with the defendant-appellants as tender security and the same was liable to be refunded on completion of the contract/tender. However, the said amount has not been released by the appellants illegally and therefore, the plaintiff is entitled to recover the aforesaid amount along with future interest. The appellants contested the suit submitting that the plaintiff was required to submit a "No Objection Certificate" from the concerned Agency relating to the contract, which was alleged to have been completed by him, along with the pre-receipted stamp, but in the instant case the plaintiff has neither submitted the "No Objection Certificate" nor pre-receipted stamp and without these documents the defendant-appellants were unable to release the alleged amount. It has been further averred that the plaintiff is a defaulter of the FCI and the defendant-Corporation has already moved its claim against the plaintiff to the tune of Rs. 88,67,599/- plus interest to the Indian Council of Arbitration for appointment of an Arbitrator and the parties are before Hon''ble the Supreme Court and thus, as per the terms and conditions of the agreement, the tender security could not have been released in favour of the plaintiff and the suit is liable to be dismissed.

However, both the Courts below, on appreciation of evidence and consideration of the arguments raised, found that the plea as raised by the appellants with regard to non-submission of "No Objection Certificate" and pre-receipted stamp was without any basis. Further it was found by the courts below that there was no dispute with regard to the amount deposited and it was not the case of the appellants that the plaintiff had not completed the work as per the tender/contract. It was further found that the plaintiff was not a defaulter of the FCI. It was further found that the defendant-appellants have failed to prove that their claim against the plaintiff has been accepted by any Court of competent jurisdiction.

Still not satisfied, the defendants have filed the instant appeal challenging the judgments and decrees of the Courts below submitting that the following substantial questions of law arise in this appeal:

Whether the findings returned by both the learned Courts below are result of misreading and non-reading of the evidence as well as provisions of law available on record of the case?

Whether the suit filed by the plaintiff is within, limitation?

Whether the plaintiff was required to submit "No Objection Certificate" with regard to performance of its work before claiming the amount in question?

Whether plaintiff is a partnership concern and whether the suit filed by the plaintiff is maintainable in law?

Whether in view of the Arbitration clause in the tender document the jurisdiction of the Civil Court is barred in the matter?"

Learned counsel for the appellants has vehemently argued that as per the terms and conditions of the agreement, the appellants are well within their rights to appropriate the tender security against any amount found to be due against the plaintiff arising out of any other contract with the appellant-Corporation. However, the argument as raised is misconceived and is liable to be rejected outrightly. Admittedly, no claim of the appellant-Corporation against the plaintiff has been determined till date by a Court of competent jurisdiction. Simply because claim of the appellants is pending adjudication before some forum, plaintiff cannot be deemed to be a defaulter and no such clause of the Contract, as argued, can be invoked against him to appropriate the tender security.

No other argument has been raised.''

Thus, the substantial questions of law, as raised, do not arise at all in this appeal.

Dismissed.