9911796707
TMI Blog1994 (4) TMI 396X X X X Extracts X X X X X X X X Extracts X X X X ..... h 3, 1987 was for detailed engineering and consultancy services for the project of Bar and Section Rolling Mill Complex valuing ₹ 45 lacs (hereinafter called 'the first contract'). Another order was placed on March 4, 1987 for the supply of equipment and initial spare pans for the Bar and Section Mill valuing ₹ 2,93,50,000/-(referred to hereinafter as 'the second contract'). ₹ 284.5 lacs was the contract price and the spare parts to be supplied were worth ₹ 9 lacs. The scope of work under the first contract was to cover (a) rendering detailed engineering and consultancy services for the aforesaid project as per the details mentioned in the order and (b) supervision of erection and commissioning at site of the mechanical equipment for the Bar and Section Mill Project. It may be mentioned that a mini steel plant was being set up by the company at its works in village Ram Banjaran District Sirmour (HP). The time schedule for the completion of the project was to be furnished by the petitioner within two months from the date of the order and that was to extend over a period of 18 months from the date of the order and all possible efforts were to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Company for the release of the pending amounts. Despite the notice the Company failed and neglected to make the payment and it is alleged that the company raised frivolous counter claims against the petitioner which were never brought to the notice of the petitioner during the execution of the contracts. The total amount claimed by the petitioner from the company under both the contracts comes to ₹ 52,80,413;-. Hence, the present petition for the winding up of the company on the ground that it has failed/ neglected to meet its admitted liability. 4. The company in its written statement has controverted the allegations made by the petitioner. It is stated that the petitioner committed so many irregularties like delayed supply of material, the material being defective and the same being not of proper rating. According to the company it had been making payments to the petitioner regularly though supply was being made after a great delay. The stand taken by the company is that its project had not only been delayed but the plant as set up cannot produce Rounds Squares and Hats of the sizes beyond 63 mm thickness as the motor advised to be installed in the Hot Bar and Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ineering 45.00 b) -Cost of Additional Supply Less : Amount to be Deducted : 2.57 341.07 - Cost of modification made by SSL as agreed by TDL in the minutes of Meeting held on 11-5-90. 13.00 - Cost of Motor, Gear Box of underrated capacity which are to be changed. 18.00 -Cost of Rolls of Wrong Specifications which are of no use. 3.50 - Improper requirement of Cables. 1.15 - Liquidity damages for delay in supply of equipment. 21.34 56.99 Amount already paid by SSL 295.26 352.25 Thus, you will observe that we have already made excess payment of TDL. You will appreciate that SSL had agreed to pay bonus to T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y uncalled for and that the company is deliberately withholding this amount for no justifiable reasons. The argument is that a dispute is being raised only to deprive the petitioner of its legitimate dues and to oust the jurisdiction of this Court under Sections 433, 434 and 439 of the Act. Mr. M. L. Sarin, learned Senior Advocate appearing for the company also relying on the figures mentioned in the letter strenuously urged that an excess payment of ₹ 11.18 lacs (Rs. 352.25 lacs ₹ 341.07 lacs) had been made which the company is entitled to recover from the petitioner. From the contents of the aforesaid letter (Annexure R 4) it becomes clear that if the deduction of ₹ 56.99 lacs by the company is justified then obviously an excess payment of ₹ 11.18 lacs as alleged by it has been made. However, if the deduction of this amount is not called (or as alleged by the petitioner than a large sum of money would certainly be due to it which the company can be said to be disputing without any justification. There are five items of deductions and I will deal with each of them separately: (i) Cost of modification made by SSL as agreed by TDL in the Minutes of Meeting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... far as LD. is concerned, you would agree the project delay of 21 months was not entirely because of TDS and a substantial delay was because finances and site conditions were not ready. Inadequacy of man power and delay of over 12 months in receipt of mill motors also added to the overall delay for which TDL cannot be held responsible. In view of the aforesaid letter and the conflicting claims of the parties it is not for this Court to decide as to which party was responsible for the delay and in the circumstances, the Company would be justified in withholding the amount calculated in terms of Cl. 7 of the second contract until it is proved that the Company was at fault which can only be done in a proper forum like a civil Court. 1 am informed that the petitioner has already filed a civil suit after the recovery of the amount claimed by it and the trial Court will obviously decide the issue on the basis of the evidence that will be led before it. 9. The only item that now remains to be considered is (ii) -- (Cost of Motor, Gear Box of under-rated capacity which are to be changed). A sum of ₹ 18 lacs is being withheld as the cost of motor/gear box of under-rated capacit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the motor cannot run for long durations by connecting stand Nos. 4 and 5. It is also submitted that the Company wanted to run the motor as per terms of the . agreement for eight hours which constitute a shift and three shifts in a day and for 300 days each year. If by connecting stand 4 and 5 the motor can be run for a few hours to roll thicker Sections, it does not mean that the plant can be run for its optimum utilisation and at any rate, the Company had not contracted for this. 10. In view of the admission made by Mr. Gadh confirming that the motor of the finishing mill was under-rated, it cannot be said -that the Company has subsequently changed its mind for processing a different product for which it had not given the specifications at the time of giving the contracts. Again, in the meeting of the representatives of the parties held on 5-6th February, 1990 (Annexure R3 with the written statement) it was brought to the notice of the petitioner that finishing mill motor gets overloaded while rolling 63 mm. size Rounds and the current exceeds the maximum current it can take and it was agreed between the parties that the petitioner will depute its experts and design engineer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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