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Municipal Board Vs. Babu Ram Lal - Court Judgment

LegalCrystal Citation
SubjectContract
CourtAllahabad
Decided On
Reported inAIR1936All723; 165Ind.Cas.439
AppellantMunicipal Board
RespondentBabu Ram Lal
Excerpt:
- - that in response to the orders placed with him by the municipal board, agra, through defendants 2 and 3, the plaintiff during the year 1930-31 executed repairs and the constructions of the work specified in annexure a, which also gives full particulars about the dates on which the respective works were completed and on which the bills relating thereto were delivered to the defendant board as well as the amounts of the bills. or (b) by any person or persons empowered under sub-section (2) or (3) of the previous section to sanction the contract if further and in like manner empowered in this behalf by the board. 6. it will be noted that sub-section (3) states that if a contract does not conform to these provisions, then it will not be binding on the board, and therefore if the.....bennet, j.1. this is a first appeal by the municipal board of agra through its chairman against a decree of the learned subordinate judge of agra in favour of the plaintiff, a contractor b. ram lal. the plaint claimed that the plaintiff had constructed 23 works in the year 1930, the works being completed in april, may, june and july of that year, and that there was a balance due to the plaintiff of rs. 4,696 on these works and also three items of the security of rs. 300, 50 and 50. para. 3 of the plaint stated:that in response to the orders placed with him by the municipal board, agra, through defendants 2 and 3, the plaintiff during the year 1930-31 executed repairs and the constructions of the work specified in annexure a, which also gives full particulars about the dates on which the.....
Judgment:

Bennet, J.

1. This is a first appeal by the Municipal Board of Agra through its Chairman against a decree of the learned Subordinate Judge of Agra in favour of the plaintiff, a contractor B. Ram Lal. The plaint claimed that the plaintiff had constructed 23 works in the year 1930, the works being completed in April, May, June and July of that year, and that there was a balance due to the plaintiff of Rs. 4,696 on these works and also three items of the security of Rs. 300, 50 and 50. Para. 3 of the plaint stated:

That in response to the orders placed with him by the Municipal Board, Agra, through defendants 2 and 3, the plaintiff during the year 1930-31 executed repairs and the constructions of the work specified in annexure A, which also gives full particulars about the dates on which the respective works were completed and on which the bills relating thereto were delivered to the defendant Board as well as the amounts of the bills.

2. Para. 2 of the plaint stated that on 2nd April 1930 the plaintiff and defendant 1, acting through its Chairman, executed an agreement providing that the plaintiff was to execute repairs and constructions of all works that may be ordered by the Municipal Engineer, Agra, from time to time during the period ending 31st March 1931; that the plaintiff should be paid for the works done at the rates enumerated in the schedule of rates sanctioned by the Municipal Board, Agra, and that if the plaintiff refused to execute any work given to him by the Board's Engineer, the defendant Board shall have the power to cancel his contract and to forfeit his security deposit of Rs. 300. These terms are embodied in a written agreement printed on pages 31 and 32 signed by the Chairman and the Executive Officer and also by the contractor on a paper bearing a stamp of Rs. 3 value. Various pleas were taken in the written statement in regard to various works. In para. 21 it was stated that the defendant was willing to pay Rs. 324-4-0 for works Nos. 2, 5, 11, 13, 21 and 22, 'which can be legally claimed against him for the serial numbers, stated above, and the security amounts of Rs. 50 and Rs 50.' In regard to the security of Rs. 300, it was claimed that this amount was premature as the bills were still unsettled. In regard to the other items various objections are taken. In para. 2 it was pleaded paras. 3 and 4 of the plaint as stated are not admitted. In para. 4 only the payment of Rs. 31-14-0 is admitted.' In para. 13 it was pleaded as regards serial No. 16, constructing a nala in Katra Umar Khan valued at Rs. 1,278, that the contractor and some P.W. D. officials of the Board in collusion with a member of the Board did some works which were neither sanctioned by the P.S.C. or Board or any authorized person. In para. 15 an objection was taken against various serials that they were not sanctioned by the P.W.D. and Board as provided under Section 97, Municipal Act, and under Government Notification No. 1906/11-6H, dated 15th July 1916, and the Board is therefore not legally bound to pay the said amount. In para. 6 of the written statement it was pleaded that the amount claimed in para, 11 of the plaint, which alludes to the total due for the works in question, was not admitted. Now it is to be noted that although in para. 3 of the plaint it bad been clearly pleaded that the orders were placed by the Municipal Board through defendants 2 and 3, that is the Municipal Engineer and the Overseer, it was not definitely pleaded in the written statement that the Municipal Engineer was not empowered by the Board to sanction any contracts. An interrogatory was addressed by the plaintiff to the Board, printed on p. 11, and question No. 4 asked was:

Is it a fact that all orders for constructions and repairs, etc., were communicated by the Municipal Board of Agra to its contractor through the Municipal Engineer?

3. In reply to this question it was open to the defendant to state that the Municipal Engineer had not been empowered by the Board under Section 96(2), Municipalities Act, U.P. Act 2 of 1916, but the Board made no such reply. On the contrary the Board merely stated on p. 12 not necessarily.' This reply implies that in some cases orders for constructions and repairs were given by the Board to its contractors through the Municipal Engineer, and so far as it goes this would be an admission that the Municipal Engineer was a person empowered under Section 96(2). No issue was framed on this point as it did not appear to the lower Court that there was any contest of this nature; nor has any ground of appeal raised this point. But Dr. Asthana, the learned Counsel for the appellants, has addressed us on this point and has argued that it was the duty of the plaintiff to prove that the Municipal Engineer was empowered to sanction contracts under Section 96(2). I consider that if the Board desired to raise this point, it should have done so by a specific pleading and have seen that an issue was framed on the subject, and moreover as the point was one within the special knowledge of the Board the onus of proof would have lain on the Board under Section 106, Evidence Act. i consider that it is tool late for the issue to be raised now in argument in first appeal and that as the matter would require evidence, that is not a point of which we should take notice. I would refer in this connexion to the ruling of their Lordships of the Privy Council in M.E. Moolla Sons, Ltd. v. Burjorjee 1932 59 IA 161, where their Lordships quoted from Connecticut Fire Insurance Co. v. Kavanagh (1892) AC 473:

When a question of law is raised for the first] time in a Court of last resort upon the construction of a document or upon facts either admitted or proved beyond controversy, it is not only competent but expedient in the interests of justice to entertain the plea.

4. But their Lordships did not allow the question to be raised before them in that case because it was a question which did not come within that dictum. The lower Court had the argument chiefly addressed to it on issues 1 and 2:

(1) What works were constructed without the sanction of the Board? What is their value and which of the defendants is liable to pay? (2) Do Sections 96 and 97, Municipal Act, bar the plaintiff's claim?

5. Under these issues the lower Court alludes to the contract in writing of 2nd April 1930, and the argument was made before the Court that this contract would not come under Section 97, Municipalities Act, which provides as follows:

97.(1) Every contract made by or on behalf of a board whereof the value of the amount exceeds Rs. 250 shall be in writing.

(2) Every such contract shall be signed:

(a) by the chairman or a vice-chairman and by the Executive Officer or a Secretary; or (b) by any person or persons empowered under Sub-section (2) or (3) of the previous section to sanction the contract if further and in like manner empowered in this behalf by the Board.

(3) If a contract to which the foregoing provisions of this section apply is executed otherwise than in conformity therewith it shall not be binding on the Board.

6. It will be noted that Sub-section (3) states that if a contract does not conform to these provisions, then it will not be binding on the Board, and therefore if the appellant can show that the requirements, of Section 97 are not satisfied, then it is not open to the plaintiff to claim under Sections 65 and 70, Contract Act, that he should receive payment for the work done on the principle of quantum meruit. On the other hand in regard to Section 96 there is no such provision, and the allegations of the appellant, that the requirements of Section 96 or of certain notifications of Government are not satisfied, will not prevent the principle of quantum meruit under Sections 65 and 70 Contract Act, from applying. The argument therefore addressed to the lower Court was largely on Section 97, and that argument has been part of the argument in appeal before us. Now the argument is that the written contract on pp. 31 and 32 will not satisfy the requirements of Section 97 because it makes provision for the contractor performing all works that are ordered by the Municipal Engineer, and the argument is that there ought to be a separate written contract for each work. Learned Counsel on both sides have not been able to produce any ruling precisely on this point. The wording in Section 97 is perfectly general and the reference is merely to 'every contract.' Now a contract is defined by the Contract Act and in Section 2 we have the definition of what is a proposal:

2. (a) When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to such act or abstinence, he is said to make a proposal: (b) When the person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted. A proposal, when accepted, becomes a promise, (e) Every promise and every set of promises, forming the consideration for each other, is an agreement. (h) An agreement enforceable by law is a contract.

7. Now examined by these considerations there is no doubt that the document printed on pp. 31 and 32 is a contract. The argument however which has been addressed to us is that a separate contract must be made for each separate work, and apparently under this argument the contract in question would be of no validity at all because it does not relate to any special work. It is obvious that the evidence given orally that certain works were to be done would not offend against the principles of Section 92, Evidence Act, because from the very nature of the agreement it is provided that instructions may be given as to what works should be done. The works which the Board had in contemplation as shown by Annexure A to the plaint consist of the construction of a number of drains and certain repairs and other small works for which it would be difficult to provide detailed plans and estimates. In particular the objection which has been taken to item 16 for constructing a nala in Tajganj is an objection which appears to me to be unsound. This drain was constructed as shown by the bill of the contractor printed on pp. 64-68 in accordance with the scheduled rates of the Municipal Board, and it is not denied that the drain was constructed on the same plan and design as other Municipal drains. In my opinion it would be extremely difficult to draw up a plan and estimate in advance to show exactly the amount of each kind of work, masonry work, excavation, brick work, concrete and lime, etc, which is detailed in this bill.

8. It is much more practical to have an engineer indicate to a contractor in what place the drain is required and to allow the contractor to carry out this work according to the standard plan for drains and according to the standard rates. The Municipalities Act is intended to apply to Municipalities all over the province and in these Municipalities there frequently arise cases like the present where a contractor has to do a number of petty works and repairs. No doubt in the aggregate these petty works and repairs may total over Rs. 250; but it does not appear to me that it is the intention of the section that every such item should require a separate written contract. Another point to be borne in mind is that under the U.P. Financial Handbook it is provided that the preparation of plans and estimates is to be paid for by 2 per cent of the total given to the contractor. In the present case the amount of the bill comes to Rs. 4,696 and 2 per cent of this would come to about Rs. 94. The expenditure of Rs. 94 in addition to the cost of the constructions does not appear to me to be one that is required by Section 97. Now I may refer to certain rulings which have been given by this Court, although not precisely on the same point. One of these is contained in District Board Allahabad v. Baijnath Prasad 1934 ALJ 55. That was a case where a point was raised on p. 58 under the similar Section 65, District Boards Act of 1922. This provides in similar terms that no contract shall be made on behalf of the Board of an amount exceeding Rs. 100 except when it is in writing and signed by similar officials.

9. In that case a contract had been made, and while the work was being done the sub-overseer of the Board gave on his own authority certain instructions to the contractor to use cement instead of mortar, and bricks of a better quality than third class bricks; and on account of this variation the contractor incurred an extra amount beyond the Rs. 100 allowed by the section. The point was taken before this Court that as there was no written contract signed by a proper official of the extra amount incurred above Rs. 100, therefore the contractor was not entitled to receive this amount under the bar in Section 65(3). The Bench of this Court did not agree with this contention and observed:

The sub-overseer was acting for his superior officer, the District Board Engineer, and it would certainly be inequitable if a contractor should suffer for carrying out the instructions of an officer of a District Board. In any case we do not think that Section 65 applies to a case of this sort and the District Board cannot seek shelter under its provisions.

10. Another ruling which I desire to refer to is reported in Munir Khan v. Municipal Board Allahabad 1930 ALJ 461. In that case the contract was that the contractor should receive a sum of Rs. 325 per mouth for the supply of 13 animals and 11 carts to collect all night soil and remove the same to such place or places as the Chairman, Public Health, of the Board shall appoint, and that such payment shall not be liable to any diminution or enhancement by reason of any variation in the number of animals, carts and drivers employed or in the amount of work required to be done by the contractor. Now in this agreement there was a provision that there could be an oral variation of the work to be done, that is, the Chairman could direct that the night soil was to be taken to different places and there could also be a variation in the number of animals, carts and drivers employed. It was not shown or claimed that such a contract would be void under Section 97, Municipalities Act. It is true that the point was not raised, but the case is of some value for showing that such a contract was before this Court and no such point was taken. It appears to me that although the parallel is not absolute still there is a certain parallel between the present agreement providing for the contractor to construct the petty repairs and petty works of the nature in Annexure A at the direction of the Municipal Engineer and the case where the sub-overseer orally varied the written contract and the case where the chairman was empowered to vary the contract for removal of night soil. I am of opinion therefore that the present contract is one which sufficiently complies with the terms of Section 97, U.P. Municipalities Act of 1916. Now a further point was taken in regard to the chairman. The present contract of 2nd April 1930 was signed both by the chairman and the Executive Officer. It has not been pleaded precisely by learned Counsel for the appellant that neither of these officials was entitled to sign a contract, but some argument was made on the point. As regards the chairman it appears to me that under Section 50, Municipalities Act, there is a provision that:

The following powers, duties and functions of a Board may be exercised by the chairman...(d) such of the powers, duties and functions referred to in Col. 3, Schedule 1 as are delegated by the Board under Section 112 to the chairman; and (e) all other duties, powers and functions of a Board with the exception of: (i) where there is an Executive Officer, those vested in an Executive Officer by Section 60; (ii) those specified in Col. 2, Schedule 1; and (iii) those delegated by the Board under Section 112.

11. In Section 96 there is a provision as follows in Sub-section (1) (b):

The sanction of the Board by resolution is required in the case of every contract; (b) involving a value or amount exceeding one thousand rupees in the case of a contract by the Board of a city and two hundred and fifty rupees in any other case.

12. Section 96 in my opinion requires that a contract for a value exceeding Rs. 1,000 in the case of a Board of a city must be sanctioned by the Board itself. In the case of a contract of a Board of a city not exceeding Rs. 1,000, Sub-section (2) allows sanction either by resolution of the Board or by a Committee of the Board empowered by regulation (which may be made by the Board under Section 297) or by one or more than one officer or servant of the Board so empowered. It is to be noted that the, section does not specify how the officer or servant is to be empowered. It was argued that the word 'empowered' should be read as empowered by resolution.' The point is absolutely of no importance in the present case because it is not denied that the chairman was empowered to sanction contracts not exceeding Rs. 1,000. In my view Section 50 does empower the chairman without a resolution or a regulation of the Board, as that section states that all other duties, with certain exceptions, shall be performed by the chairman. One of those exceptions is the duty specified in Col. 2, Schedule 1. Now in Col. 2, Schedule 1 there is a reference to Section 96(2), but only to a part of that sub-section as follows: 'to empower a committee or officer or servant of the Board to sanction other contracts.' By this I understand that a chairman cannot exercise this power of empowering a committee or other officer or servant. But as the other portion of the sub-section is left out, that is about the sanctioning of a contract of less than Rs. 1,000, I consider that the result of the entry in Schedule 1 and the provisions of Section 50 is that a chairman is empowered to sanction contracts which do not exceed Rs. 1,000.

13. This power is of course subject to the condition in Sub-section (e) (iii), Section 50 that the power of sanctioning contracts has not been delegated by the Board under Section 112 to some one else. If however a Board chose to delegate the power to sanction its contracts to some one else, it might at the same time empower the chairman to sanction these contracts. Now learned Counsel for the appellant alluded in his arguments to certain Government notifications. One of these notifications referred to in paras. 15 and 22 of the written statement is of 1916, and there were similar notifications in 1926 and 1930. Now the Government notification in the case of the notification of 3rd April 1930, which was the one current at the time the work was undertaken being a day after the written contract on p. 31, purported to be with reference to Section 95(b), (c) and (d) and Section 296(2). Now Section 296(2) refers to the local Government making rules consistent with the Act in the subsection:

(a) For any matter for which power to make provision is conferred expressly or by implication, and (b) generally for the guidance of a Board or any Government officer in any matter connected with the carrying out of the provisions of this or any other enactment relating to municipalities.

14. In Sub-section (1) there is provision for the Local Government making rules in connexion with certain matters in Sections 29, 95, 127, 153 and 235. Now the Local Government is not specially authorised by Section 96 or Section 97 to make rules in regard to those sections. It is plain, therefore, that the provisions of the Local Government are under Section 296(2)(b), that is for the guidance of the Board and of its officers. This has some importance because it appears to me that where regulations are made for the guidance of the Board or its officers those regulations cannot beheld to apply to the public. A direction to the Board that it should do its work in a certain way is a matter for the consideration of the Board, and neglect to carry out that direction cannot affect the rights of the public against the Board. In the present case learned Counsel claims that the failure to carry out these directions by the Board entitled the Board to refuse to pay the contractor. That is a proposition which appears to me to be contrary to the power given by Section 296(2), Municipalities Act, to the Local Government. Regulations which are for the guidance of the Board cannot be construed in the sense in which learned Counsel desires. These regulations provided in the notification of 3rd April 1930 that no work other than a petty work the probable cost of which is less than Rs. 250 shall be executed on behalf of the Board, until a detailed plan and estimate for the work have been prepared and sanctioned, and further that no contract for the execution of works between Rs. 250 and Rs. 5,000 shall be given without tenders being invited by public notice. Now I consider that the omission by the Board to carry out these provisions in regard to detailed plans and estimates cannot be a matter pleaded in defence by the Board to a claim by a contractor. It is my opinion that these provisions in this Government notification cannot be read as part of Section 97, Municipalities Act, and it is with Section 97 that we are alone principally concerned because, even if these regulations are read as a part of Section 96, the principle of quantum meruit will apply as it is not specifically barred, and, therefore, the regulations could not be pleaded in defence of the claim for work done. The principle of quantum meruit was applied in District Board Allahabad v. Baijnath Prasad 1934 ALJ 55 and has been applied in the following rulings: Municipal Committee, Gujranwala v. FazalDin 1929 11 Lah 121, Municipal Council, Tiruvarur v. P. R. Kannuswami Pillai 1930 53 Mad 352, Mathura Mohan Saha v Ram Kumar Saha 1916 43 Cal 790, Mohammad Ebrahim Molla v. Commissioners for the Fort of Chittagong 1927 54 Cal 189 and Abaji Sitaram Modak v. The Trimbak Municipality (1904) 28 Bom 66. On the other hand learned Counsel for the appellant referred to Municipal Board, Lucknow v. S.C. Deb 1932 8 Luck 1. In this ruling it was held that:

Where a special law creates a corporate body and that body cannot enter into a contract except under seal, no relief can be given to a person relying on a contract entered into between him and the corporate body, but not under seal even on quantum meruit.

15. In that case as shown at p. 7 there was a writing, but that writing was not signed by any person specified in Clauses (a) and (b), Sub-section 2 of Section 97 and accordingly the Court held that the law of quantum meruit would not apply. On the view that I have taken there is in the present case a writing signed by the chairman who was a person empowered within the meaning of Section 97(2) as that sub-section specifically mentions the chairman. Further the executive officer also signed this contract. The present case, therefore, is distinguishable from that reported in Municipal Board, Lucknow v. S.C. Deb 1932 8 Luck 1. Learned Counsel next relied on Radha Krishna Das v. Municipal Board, Benares (1905) 27 All 592. In that case there was no contract in writing at all. There was only a letter by the Municipal Engineer and for that reason the law of qnantum meruit was not applied. Reference was also made to Ramaswamy Chetty v. Municipal Council, Tanjore (1906) 29 Mad 360, and in that case there was no written contract signed by the chairman or other authorized officer. Now in regard to a certain number of items in annexure A, there are written orders by the Municipal Engineer:

Item No. 2-written order at p. 32;

Item No. 6-written order at p. 36;

Item No. 10-written order at p. 65;

Item No. 14-written order at p. 36;

Item No. 15-written order at p. 34;:

Item No. 20-written order at p. 34;

Item No 23-written order at p. 35.

16. In regard to other items the evidence on p. 13 of the contractor is:

I was given 23 works to be done by Mr. A. C. Sinha, then engineer of the municipality, as set out in the list with the plaint.... The engineer used to point out to me the locality of the work to be done, used to take levels and the work was supervised by the overseer, the engineer himself and sometimes by the chairman also.

17. In regard to the particular nala at Tajganj, Item 16, he stated:

The chairman and Municipal Engineer had given me verbal orders for the construction of this nala.... I had protested against doing a big work without a tender and order in writing, but Mr. Sinha said that many works were done on parole order and he asked me to do it which I did.

18. The Court below observes on p. 25, line 43:

The defendant Board produces no agreement made with persons other than the plaintiff, though called by me, which shows that it has been their uniform practice to get the contractors to do the work for them for higher valuations without strictly conforming to their own procedure adopted in Sections 96 and 97. The old law is no more in force, but the new one commencing from 1921 is obtaining at present. Above all Section 70, Contract Act, provides that where a work is done not gratuitously and the work is enjoyed by the other person, the latter is legally bound to compensate the former for it. There is not only evidence, but clear admission by the defendant's official, the overseer, that all the works made by the plaintiff are at present in possession and enjoyment of the Municipal Board.

19. Learned Counsel were not able to explain what is meant by the new law commencing from 1921, but probably what was meant was the Government Order. Now one point taken by learned Counsel for the appellant is that Section 96 provides that work involving a value or amount exceeding Rs. 1,000 must be sanctioned by the Board by resolution, and he, therefore, argues that Item 16, the Tajganj nala, should have been sanctioned by the Board because it was such a work. Now his claim is apparently based on the fact that in annexure A of the plaint the amount of the bill is over Rs. 1,000, that is Rs. 1,278. That amount, however, was not admitted by the defendant as para. 6 of the written statement-shows. The subject of the amount due on the different items was argued before the lower Court and the lower Court held that instead of a total of Rs. 4,696 only Rs. 4,000 should be allowed. Now in this Rs. 4,000 allowed there is the item of Rs. 324-4-0 for the six works admitted in para. 21 of the written statement. The deduction, therefore, must be made from the remaining items. Deducting Rupees 324-4-0 from Rs. 4,000 we get Rupees 3,675-12-0. This is the amount which was allowed, therefore, on the contested items and the sum of Rs. 696 was deducted from the contested items. In other words about 5/6ths were allowed and l/6th was disallowed. The amount, therefore, disallowed on each item was about l/6th. Taking the amount, therefore, of Rs. 1,278 and disallowing about l/6th, in that proportion, the amount would still slightly exceed Rs. 1,000. But it is not possible to say that the Court below intended to make a proportionate deduction for every amount. Some of the items are not items in which there could be much dispute as some of the items were for supplying definite material; for example item 14 supplying of gas, lamp stands, Rs. 50 (a lump sum) could not admit of any apparent deduction. Under these circumstances I do not think it can be said that the Court below has come to a finding that item 16 for the Tajganj nala was an item for which the Court has awarded Rs. 1,000.

20. But even supposing it was held that the Court had found that the amount due for this nala is slightly over Rs. 1000, there still remains the point whether it would come under Section 96(1) or not. What is considered at the time of sanctioning a work is what will be the probable cost, and that is shown by the Government Notification dated 3rd April 1930, which provides in Rule 1: 'The probable cost of which etc.' It is only possible for the cost to be approximately estimated before a work is undertaken, and in the present case with regard to the nala of Tajganj there is no evidence on behalf of the defendant to indicate that at the time the contractor was ordered by the engineer to do the work it was known that the work would exceed Rs. 1,000. For these reasons I do not think that the appellant has established that the payment for the Tajganj nala is not due from the appellant. Now in any case if there was a violation of the direction contained in Section 96(1)(b), and it was necessary for this Tajganj nala contract to be sanctioned by the Board, still that was a violation only of the provisions of Section 96, and there is no provision in Section 96 that if the contract does not Comply with the provisions of that section, then the contract would not be binding on the Board.

21. In other words even if it was necessary for the contract for the Tajganj nala to be sanctioned by a resolution of the Board, the want of such a resolution will not prevent the principle of quantum meruit under Sections 65 and 70, Contract Act, from applying, and learned Counsel for the appellant has shown no authority to the contrary. The case for the defendant in regard to a conspiracy of a member of the Board has not been established by any evidence, and learned Counsel for the appellant did not lay any evidence for the defence in this matter before us. He points out that he has referred to an admission in cross-examination of a wit. ness of the plaintiff, one Azmat Ali, on p. 16, line 19:

There is a new hotel near the gate of the Taj. It is owned by Imdad Ali who is the wife's brother of Naimuddin.... I saw Ram Lal, contractor, work on the drain, while the hotel site is quite separate. Naimuddin was dismembered from the Tajganj ward I do not know why.

22. This evidence does not establish the admission that there was any conspiracy or that this member, Mr. Naimuddin, had anything to do with the construction of the Tajganj nala. The defence did not put the chairman of the Board into the witness box to deny that he had sanctioned this nala as alleged by the contractor. I consider therefore that the plea of conspiracy has not been at all made out. On my view of the law the appeal would be dismissed.

Smith, J.

23. I have heard the judgment just now delivered by my learned brother. I regret that I am unable to agree with the view he takes of the effect of Section 97, Municipalities Act. It seems to me that the general agreement that was arrived at between the plaintiff Ram Lal and the Municipal Board of Agra on 2nd April 1930 could not take the place of a contract in writing whenever any definite piece of work had to be carried out. As is pointed out by learned Counsel for the appellant, this agreement is in quite general terms, and relates to no definite and specific piece of work at all. In my opinion the provisions of Section 97, are partly, at any rate, designed to prevent general agreements of this nature being pleaded; as justification for the giving of contracts for the carrying out of definite works. In my opinion the items in excess of Rs. 250 in the list appended to the plaintiff's plaint all required contracts in writing, as laid down by Section 97(1), Municipalities Act. These items are, apart from No. 2, which is not objected to on behalf of the appellant, six in number, namely Nos. 4 6, 7, 8,10 and 16 in the list. As regards No. 6 it appears that on 3rd May 1930, the plaintiff received from Mr. A. C. Sinha, the Municipal Engineer, a written ' work order' to the following effect:

You are hereby informed that the work of paving and draining a lane at Tajganj near B. Bishamber Nath, professor, has been given to you; you are therefore directed to commence the work and receive necessary instructions from the Overseer. Sd/. A. C. Sinha, B. Sc., etc. Municipal Engineer,

24. This so-called work order' may in my opinion be regarded as a contract in writing within the meaning of Section 97(1), Municipalities Act, and in view of the fact that the Municipal Board has not shown that the Municipal Engineer was not empowered to sign such contracts, I think that as regards this particular item it cannot be urged that the contract was not binding on the Board by reason of the provisions of Section 97(3) of the Act. As regards the remaining items five however, it is not shown that the plaintiff received any 'work orders' or anything else in writing in respect of them, and in my opinion the plaintiff is debarred from claiming any amount in respect of those works by reason of the provisions of Section 97(1)(2) and (3), Municipalities Act. The rulings to which we have been referred by learned Counsel for the respective parties have already been set forth in the judgment of my learned brother, and it is not necessary for me to mention any of them again.

25. (The following point of law was there upon referred under Section 98, Civil P.C.: 'Is plaintiff's claim for items 4, 7, 8, 10 and 16 of annexure A of the plaint barred by the provisions of Section 97, U.P. Municipalities Act of 1916, and does the written contract of 2nd April 1930, not satisfy the requirements of that section?')

Sulaiman, C.J.

26. The plaintiff-respondent is a contractor and the defendant-appellant is the Municipal Board of Agra. Admittedly an agreement was duly executed between the plaintiff and the defendant on 2nd April 1930 and was signed by the plaintiff-contractor, as also by the Chairman and the Executive Officer of the Municipal Board. The question of the validity of this agreement itself is not before me. The plaintiff's claim was for recovery of amounts due to him from the Board for work done in pursuance of this agreement. One of the defences to the suit was that there should have been separate agreements for each item of work done by the plaintiff, and in the absence of such separate agreements, the contract was not binding on the Board. I am not concerned with the other points which arose in the case. The two learned Judges before whom this case came up for hearing differed on the point mentioned above and have accordingly referred the following point of law to me under Section 98, Civil P.C.:

Is plaintiff's claim for items Nos. 4, 7, 8, 10 and 16 of annexure A of the plaint barred by the provisions of Section 97, U.P. Municipalities Act of 1916, and does the written contract of 2nd April 1930 not satisfy the requirements of that section

27. The contention on behalf of the Board is that the provision in Section 97 that every contract made by or on behalf of a Board whereof the value of the amount exceeds Rs. 250 shall be in writing means that if any item of work to be done exceeds the value of Rs. 250, then there should be a separate contract for such item of work, and that the Board cannot enter into one contract for a large number of items each of which in value exceeds Rs. 250, but that there should be so many different written contracts. It seems to me that Section 97 is not capable of such an interpretation. There is obviously a clear distinction between a contract between two parties and the work done by either party in pursuance of it. Contract' is defined in the Contract Act, Section 2, as being an agreement enforceable by law, and an agreement comes into existence when the offer made by one party is accepted by the other. I have therefore to see whether the document in question embodied the contract between the parties which is required by Section 97 to be in writing. The agreement stated that the said contractor agreed and bound himself to execute the repairs and construction of all works that might be ordered by the Municipal Engineer from time during the period ending 31st March 1931, and the said con-tractor agreed to execute and perform all works that might be ordered by the Board's engineer; that the said contractor shall be paid for the work done at rates enumerated in the Schedule of rates sanctioned by the Municipal Board. There were other items in the contract as well with which I am not just at present concerned. It also contained the covenant that if the contractor refused to execute any work given to him by the Board's Engineer, the Municipal Board would have power to annul his contract and erase his name from the list of approved contractors, in which event the contractor would be liable to forfeit his security deposit. The plaintiff was, therefore, bound to execute repairs and construction of all works that were ordered by the Municipal Engineer at the peril of having his security deposit forfeited if he refused to execute any such work given to him by the Board's Engineer.

28. It is difficult to see why such an agreement cannot be the contract between the parties which is mentioned in Section 97. The value of the work to be done for the period of one year was presumably to be in excess of Rs. 250; therefore the contract was entered into in writing in order to fulfil the requirements of Section 97. So far as the Board was concerned, it contracted to pay the contractor at the sanctioned scheduled rates for all repairs and construction of works that he might do on the orders given by the Municipal Engineer. No specifications and no restrictions were laid down. Very often it is impossible to know before hand what sort of repairs would be required during the course of the following 12 months and it may even be impossible to know before hand what new constructions may be urgently required. It is therefore impossible to hold that unless a complete list of all the detailed items of work to be done during the whole period is given in the written agreement, there is no written contract as required by law. In my opinion the contract was one and it is in writing, though the items of work to which the contract related were bound to be numerous. With great respect, I am unable to agree with the view expressed by Smith, J., that this written agreement by itself is not sufficient. I agree with the view expressed by Bennet, J., that this written contract fulfils the requirements of Section 97. My answer to the question referred, therefore is that the plaintiff's claim for the various items is not barred by the provisions of Section 97 and that the written contract of 2nd April 1930, satisfies the requirements of that section. Let the case be sent back to the Bench concerned for disposal.


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