contract works= correcting the typographical error in the CSR rates was not an act of modification of those rates as such. =That act cannot be construed as retrospective change introduced in the CSR by the respondents. The High Court has justly rejected this plea by giving an illustration that if the CSR rates were to be misprinted as Re.1 or Rs. 2 per cubic metre for the financial year 1981-82, the appellant would not have agreed to be bound by such rate. ; when the terms of contract are clear, no other facts are permitted to sway away the terms of contract =Trial Court was swayed away by the fact that the appellant was required to transport water from some distance via Kaccha Road for which the appellant was entitled to such claim. The High Court in paragraph 21 of the impugned judgment, however, considered the said claim of the appellant with reference to the contract document. In that, Clause “d” of tender Item No.8, pertaining to watering and mechanized compaction of earth work, clearly stated that the rates for earthwork raising are inclusive of watering and compaction at optimum moisture content. Further, in Clause “d” of Item No.8, it has been made amply clear that no extra payment for these items would be given.

1
NON-REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL ORIGINAL JURISDICTION
CIVIL APPEAL No.10269 OF 2017
(Arising out of SLP (Civil) No.15862 of 2010)
M/s. National Building Construction ….. Appellant
Versus
State of Maharashtra & Ors. ….. Respondents
J U D G M E N T
A.M. KHANWILKAR, J.
1. The present appeal arises out of the judgment and
decree dated 1st September, 2009, passed by the High Court
of Judicature at Bombay, Nagpur Bench, in First Appeal
No.312 of 1992 whereby the High Court has partly modified
the decree passed by the Trial Court and negatived Claim
Nos.1 and 3 set up by the appellant.
2
2. The appellant, a partnership firm engaged in civil
construction works, had submitted a tender for work
pertaining to construction of one Nishanghat Minor
Irrigation Tank in pursuance of a notice issued by
respondent No.1 – State of Maharashtra. After the
appellant’s tender was approved and work order dated 21st
December, 1978 was issued by the State in favour of the
appellant, the parties executed an agreement at Nagpur.
After completion of the contract work on 16th June, 1982,
final bill was paid to the appellant on 22nd October, 1982,
which the appellant disputed on the ground that it had
performed extra work over and above the tendered work, for
which payment was not included. Feeling aggrieved by the
alleged shortfall in payment and unable to settle the dispute
with the respondents, the appellant filed a suit against the
respondents before the Court of 6th Joint Civil Judge (Senior
Division), Nagpur being Special Civil Suit No.279 of 1985,
inter alia seeking a decree for amounts due to it under the
following heads of claim:
3
a. Claim 1: Unpaid amounts arising out of
difference in government-prescribed rates for
work of excess stone revetment/pitching,
amounting to Rs. 1,76,199.28/-
b. Claim 2: Unpaid amounts for difference in rates
relating to excavation work, amounting to Rs.
90,165/-
c. Claim 3: Unpaid amounts for extra lead for
water works, amounting to Rs. 80,000/-
and
d. Claim 4: Unpaid amounts for extra lead for
sand, amounting to Rs. 9900/-
In addition, the appellant also claimed interest on the
claim amount, of Rs.1,42,505.60, calculated at 15% p.a.
from 22nd October, 1982 till the date of filing the suit.
With interest, the aggregate claim of the appellant was
Rs. 4,98, 769.86/-.
3. Each of the above claims was specifically challenged by
the respondents in their written statement. After
considering the rival contentions and the evidence on
record, the Trial Court passed a decree in favour of the
appellant on 29th October, 1991, the operative part of which
is reproduced hereinbelow:
“ORDER
1] Suit is decreed with costs.
4
2] Defendants do pay Rs. 4,98,769.87 to the plaintiff.
3] The decreetal amount to carry future interest @ 15% per
annum from the date of filing of the suit till its actual
realization.
4] Decree be drawn accordingly.”
4. The respondents preferred an appeal against the
aforesaid decree passed by the Trial Court before the High
Court of Bombay, Nagpur Bench, being First Appeal No.312
of 1992. Over the course of hearing, the learned Single
Judge framed the following points for consideration:
“I) Whether the trial Court was justified in granting the claim
of Rs.1,76,199/towards pitching?
II) Whether the plaintiff was entitled to an amount of
Rs.90,165/for the excavation of the soft rock of the strata?
III) Whether the plaintiff was entitled to an amount of
Rs.80,000/for additional lead for water?
IV) Whether the grant of compensation @ Rs.9,900/towards
lead for sand was justified?
V) What order?”
5. Ultimately, the High Court by its judgment and decree
dated 1st September, 2009 partly allowed the respondents’
appeal, modifying the decision of the Trial Court and
reducing the decreetal amount as under:
5
“23. For the reasons aforesaid, the first appeal is partly
allowed. The judgment and decree passed by the 6th Joint
Civil Judge (Senior Division), Nagpur on 29.10.1991 is
hereby modified. It is held that the respondent plaintiff
would not be entitled to claim an amount of Rs.
1,76,199/towards pitching an amount of Rs. 80,000/for
additional lead of water. The findings recorded by the
trial Court in regard to the entitlement of plaintiff to an
amount of Rs. 90,165/for excavation of soft rock and an
amount of Rs. 9900/towards lead of sand are hereby
confirmed. The plaintiff respondent would, therefore, be
entitled to only an amount of Rs. 1,00,065/with interest @
15% per annum from the date of filing of the suit till its
actual realization.
Order accordingly. No order as to costs.”
The High Court, while partly allowing the appellant’s claims,
viz. Claim 2 and Claim 4, struck off Claim 1 and Claim 3,
having held that the said claims were granted by the Trial
Court without considering the evidence on record. The High
Court further held that while there was no dispute as to the
work done by the appellant under this head of claim, the
Government/C.S.R. rate at which such work was to be
compensated was erroneously expressed in terms of square
metres instead of cubic metres, resulting in confusion. The
High Court came to hold that the respondents had produced
evidence to show that this error had been rectified and, in
6
fact, the appellant was paid at a rate higher than the
rectified prescribed rate. The Court noted that despite this,
the appellant was claiming payment under this head of
claim at an exorbitant and abnormal rate, which was
untenable. The High Court went on to hold that the Trial
Court also erroneously granted the claim relating to extra
lead for water (i.e. Claim 3). For, the agreement executed by
the parties for the contract work clearly mentioned that the
work done by the appellant under this head of claim would
include watering and mechanized compaction of earth work
and no extra payment towards lead for water would be
payable. Further, the appellant was duly informed by the
Executive Engineer, Minor Irrigation Division, Nagpur, that
its claim relating to extra lead for water was not acceptable.
Hence, such claim was rejected. The High Court, however,
did not disturb the interest component as ordered by the
Trial Court.
6. The High Court’s decision has been assailed by the
appellant in the present appeal, on several grounds. As
regards Claim 1, the rectification issued by the respondents
7
with respect to the Government/CSR rates for pitching work
was misleading and was produced as an afterthought, being
issued much after the end of the relevant financial year.
Such direction could not be issued with retrospective effect.
The rectification itself is inadmissible in evidence, not
having been pleaded by the respondents in their written
statement before the Trial Court. As regards Claim 3, the
High Court ought not to have disregarded the said claim
when the respondents’ witness himself admitted that there
was a need for additional water to be brought by the
appellant. The respondents’ contention that they had
rejected the appellant’s demand relating to lead for water
and duly communicated the same to it, was also rightly
rejected by the Trial Court as bereft of merit. Finally, since
the agreement executed between the parties for the contract
work was one between a private party and the State, the
State (i.e. the respondents) was obliged to act in a just, fair
and reasonable manner.
8
7. The respondents, in reply, have contended that the
High Court’s decision was justified and based on the
evidence brought on record. The respondents have
reiterated the findings and conclusion reached by the High
Court while rejecting Claims 1 and 3 of the appellant.
Additionally, the respondents have faintly denied the claims
made by the appellant for variation in excavation of rock i.e.
Claim No.2 and in extra lead of sand i.e. Claim 4, stating
that the respondents never agreed to pay for any variation.
Notwithstanding the above, the respondents had
nevertheless paid the appellant for extra work done.
8. Considering the rival submissions, we are called upon
to examine the justness of the view taken by the High Court
with respect to the claim set up by the appellant in respect
to pitching of stones and extra lead for water, being Claim
Nos.1 and 3, respectively. Taking up the issue regarding
Claim No.1 for a sum of Rs.1,76,199/-, the Trial Court, for
allowing the same in favour of the appellant, had noted that
there was no pleading in respect of the evidence produced
by the respondents (defendants) and, therefore, such
9
evidence was inadmissible. Secondly, the direction issued
by the Superintending Engineer vide its letter dated 30th
May, 1983, pertained to financial year 1981-82. That was
illegal. For, it was impermissible to correct the earlier
notified rates of CSR with retrospective effect. The High
Court, on the other hand, accepted the said evidence and
found fault with the view taken by the Trial Court that there
was no pleading or that the evidence produced by the
defendants was inadmissible. As regards the pleading in
their written statement in relation to Claim No.1, the
respondents had asserted thus:-
“A. As to claim no. 1: Item No. 12A as put forth by
the plaintiff in this suit is denied. It is submitted
that the deals with the providing of stone
revetment (Pitching of 30 cm. thickness). The
quantity put to tender of this item was 300 M3
and the remaining quantity of pitching from
available material, vide tender item No. 12-B was
3144 M3. However, during the execution, the
quantity of item No. 12-A which was 300 M3 has
been increased to 3455.50 M3 as material
available for pitching was less than tender
quantity. The allegations that clause No. 38 of
the agreement has not been complete with, are
denied. It is submitted that as per clause 38 of
the agreement, the quantity exceeded by more
than 25% of the tender quantity is to be paid as
per CSR during which the work executed and the
plaintiff was paid as per this condition as below:
10
As per tender rate 481 M3 @ Rs.27.60
Rs.13275.60
As per CSR 80-81 409.24 M3 @ Rs.28.75
Rs.11765.65
As per CSR 81-82 2575.26 M3 @ Rs.35.70
Rs.91936.75
It is denied that the plaintiff is entitled to claim the
amount as detailed in chart given in this para. It
is submitted that the plaintiff’s claim for
CSR 81-82 i.e. Rs. 97.30 is not correct as the
rate of pitching in CSR 81-82 was given as
Rs. 24.25 per M2 by the Govt. and no rate
for per cubic meter is given in this CSR.
However, the Superintending Engineer,
Nagpur Irrigation Circle Nagpur, vide letter
No. 3517/HMD dt. 19.6.1981 instructed to
increase the rates for the year, 1981-82 by
30% above the CSR 180-81 for the items not
included in the Govt. Sanctioned CSR for
1981-82. Accordingly, this office has taken
the rate of pitching per cubic meter for
80-81 which was Rs. 27.60 per cubic meter
and adding 30% above that the rate worked
out Rs. 35.70 per M3 and the plaintiff was
paid at this rate. Hence there is no substance
in the claim of the plaintiff as he has been paid
fully as per contract conditions. The plaintiff is
bound by the terms of the agreement and in view
the provisions made in the agreement reference
as to the dispute raised by the plaintiff was
already made to the Superintending Engineer and
it was finally settled by the said authorities. The
plaintiff is bound by the said decision.”
(emphasis supplied)

The evidence adduced by the respondents, including the
deposition of DW1, was nothing but elaboration of the said
pleading. The material facts to deny the claim of the
11
appellant qua this head under consideration was duly
pleaded. In the context of pleading in the written statement,
DW1 in his examination-in-chief had stated thus:-
“2. In agreement so executed by plaintiff he had
quoted the rate of pitching work 10% above the
Govt. rate in cubic metres. In case the actual work
carried out by the contractor exceeds by 25%
above the estimate then the contractor is entitled
to charge the rate as per CSR prevailing. It was
also agreed that in case the rate of any particular
item is act mentioned in the CSR then the rate is
to be fixed mutually by department and contractor
to be derived from CSR.
3. Plaintiff never raised any dispute about
the rates. The pitching rates in the CSR of
1981-82 are mentioned in the square metres
and not in cubic metres. But the pitching
rates in earlier CSR of 1979-89 and 1980-81
were in the cubic metres. As per clause 38 of
the agreement as the rate of pitching in CSR
1981-82 were not in cubic metres that rate
was not applicable to be paid to the
contractor. In such a case the rate was to be
fixed for pitching work in the year 1981-82 by the
superintending Engineer. By Exh. 47 I
reported to the Supdt. Engineer that whom I
converted the rates from square metres to
cubic meters for pitching work for the year
1981-82. I found that the rates of was too
high and abnormal and therefore what
should be done. Exh. 47 in my opinion is not
a recommendation to Supdt. Engineer. But
only an abnormality was pointed out to the
Supdt. Engineer. The Supdt. Engineer in
pursuance of my letter Exh. 47 intimated
such abnormality to the Govt. Govt. by letter
dated 23.6.82 intimated all Supdt. Engineer
that it was an anomaly and therefore the
12
labour rate should be corrected. The letter
now shown to me is the same. The Zerox
copy of the Govt. letter received by the
Department is placed on record along with
list Exh. 113. The Xerox copy tallies with the
letter received by us. The letter received by the
department is returned to the witness and the
Xerox copy is placed at Exh. 117.
4. Supdt. Engineer subsequently issued
directions that in case any rate is not mentioned
in the CSR then the payment should be made as
per the earlier CSR with 30% raise in it. As the
rate of pitching in the CSR of 1981-82 was
abnormal and end of was mentioned in
square metres, as per the directions of the
Supdt. Engineer rates as per the CSR of
1981-82 with 30% raise was to be paid to
the contractor plaintiff. Those instructions
are vide letter dt. 19.6.1981. It is placed at
Exh.118. Plaintiff agreed in the agreement that
Supdt. Engineer in the final authority to decide
the rates. It is also so mentioned in the manual.
Nagpur Irrigation Project Circle Supdt. Engineer in
authorized by the Govt. to fix the CSR.
Accordingly on the instruction of the Govt.
Supdt. Engineer Nagpur Irrigation Project
Circle corrected the pitching rates of CSR
1981-82 and informed us accordingly vide
letter dt. 30.5.1983. The letter is dt.
30.5.1983 and S.E. NIRC quoted us the rate
Rs. 9.95 for square metre against K.M.
24.25 per square metre against wrongly
mentioned rates on CSR of 1981-82. By the
same letter Supdt. Engineer also fixed the
rates in cubic metres. The cubic metre is Rs.
33.15. The department received the Xerox copy
of letter dt. 30.5.1983 from Supdt. Engineer. The
letter date 30.5.1983 is placed at Exh. 119. Exh.
119 is issued by Executive Engineer, Canal
Design Division in the Capacity of Secretary. CSR
Committee. Nagpur to the Supdt. Engineer, NIPC
13
in the capacity of president of the CSR
committee.”
(emphasis supplied)
Notably, this evidence was allowed to be let in by the
appellant without any demur. No objection was taken for
exhibiting the aforementioned official documents.
9. Having perused the pleading in the written statement
and the evidence produced by the respondents (defendants),
the High Court, after analysing the same, concluded that
there was obvious typographical error in the CSR rates
pertaining to financial year 1981-82, which was later on
corrected, and gave benefit of that position to the
respondents and came to hold that the appellant was not
entitled to the claim amount of Rs.1,76,199/-. The High
Court analysed the pleading as well as the oral and
documentary evidences produced by the defendant to come
to the said conclusion. It will be useful to advert to the
discussion found in the impugned judgment in that behalf
which reads thus :-
“19. On perusal of the Record & Proceedings, it
appears that the trial Court had committed a
serious error in granting the claim of Rs.
1,76,199/towards pitching. In the instant case,
14
the appellants State of Maharashtra had not
disputed that the total excavated quantity by the
plaintiff contractor was 2575.26 meter cube
which was over and above the actual quantity
which was required for the stone revetment and,
hence, the plaintiff contractor was entitled to seek
payment in this regard at the C.S.R. rate. It is
not in dispute that the contract existed for
the period from 1979 to 1982. For the year
1979-80, the C.S.R. rate for pitching was Rs.
27.60 Ps. Per Cubic Meter, for the year
1980-81, it was Rs. 28.55 Ps. Per cubic
meter. For the third year i.e., 1981-82, the
year for which the dispute arose, the rate
was wrongly shown in square meters in
stead of showing it in cubic meters. The rate
was shown as Rs. 24.25 Ps. Per square
meter and this error on the part of the
Government of wrongly quoting the rate in
C.S.R. of the year 1981-82 has given rise to
the dispute and had also given rise to the
claim made by the plaintiff for the pitching
work @ Rs.80.33 Ps. The State had produced
the C.S.R. rates for the year 1982-83 also.
These rates show that for the year 1982-83,
the C.S.R. rate for pitching was Rs. 46.65
Ps. Per Meter cube. Thus, it is apparent that
C.S.R. rate was Rs. 27.60 Ps. For the year
1979-80, Rs. 28.55 Ps. For the year 1980-81,
for the year 1982-83, it was 46.65 Ps. and
due to a mistake in mentioning the C.S.R.
rate in square meters in the year 1981-82,
the plaintiff was claiming at an exorbitant
and abnormal rate @ Rs. 97.60 Ps. per cubic
meter. The State had produced the
necessary documents on record to show that
this error was rectified by the Government.
The document at Exh. 119 clearly show that
there was a rectification of the mistake and
it was held that for the years 1981-82, the
rate was Rs. 33.50 Ps. per cubic meter and
for the year 1982-83, it was Rs. 46.65 ps.
15
per cubic meters. It is not in dispute that the
plaintiff has been paid @ Rs. 35.70 per cubic
meter for the extra work of pitching carried out by
the plaintiff during the year 1981-82 and this is
over and above the rate of Rs. 33.50 Ps. which
was due and payable for the year 1981-82
according to the rectification. The submission
made on behalf of the respondent contractor
that even if there is a mistake in the C.S.R.
rate, the Government is bound to pay at the
rate stated in the C.S.R. is totally ill
founded. It would be also interesting to
consider whether the plaintiff contractor
would have accepted the C.S.R. rate of Rs.
1/or Rs. 2/per cubic meter if it was so
wrongly mentioned in the C.S.R. of the year
1981-82. The documents on record clearly show
that there as a mistake in the rate of pitching in
the C.S.R of the year 1981-82 and that mistake
was duly rectified and the plaintiff contractor was
indeed paid at a rate which was more than the
rate prescribed after rectification. It appears
that the trial Court has granted the first
claim of the plaintiff on the mere asking
without considering the necessary
documents produced by the State on record.
The oral evidence of the defendant is also
not considered on the ground that there are
no pleadings to support that evidence. This
observation of the trial Court is also totally
incorrect as the evidence of the witness of
the defendants is in consonance with the
pleadings of the defendants in the written
statement, specially in paragraph 5A of the
written statement. The defendants’ witness
had clearly stated in his evidence that the rate of
pitching as per the C.S.R. for the year 1981-82
was abnormal and was mentioned in square
meters. According to the witness, the abnormality
was pointed out to the Superintending Engineer
and in view of the anomaly in the rate, there was
a rectification of the mistake by the Government.
16
It is stated that by the communication at Exh.
119, it was brought to the notice of the authorities
that the C.S.R. rates for pitching for the year
1981-82 were wrongly quoted and the rate per
cubic meter was Rs. 33.50 Ps. The plaintiff had
been paid at the rate of Rs. 35.70 Ps. per cubic
meter. The witness further deposed that the rate
of Rs. 97.60 per cubic meter as claimed by the
plaintiff had never reached at any point of time
and the plaintiff was not entitled to claim at that
rate only on the basis of the mistake in the C.S.R.
for the year 1981-82. The finding on the first
issue is recorded without considering the
material evidence on record and without
considering that there was a genuine
mistake in the C.S.R. of the year 1981-82 so
far as the item of pitching was concerned. It
would also be necessary to refer to the
document at Exh. 71A to deny the claim of
the plaintiff towards pitching. It is necessary
to reverse the finding of the trial Court on this
issue and hold that the plaintiff would not be
entitled to an amount of Rs.1,76,199/- towards
pitching.”
(emphasis supplied)

10. In our opinion, the High Court was right, both on facts
and in law, in rejecting the claim of the appellant in respect
of pitching of stones, to the extent of Rs.1,76,199/-. We find
that the finding of facts recorded by the High Court is in
consonance with the pleading in the written statement and
the oral and documentary evidences produced by the
respondents (defendants) in that behalf. The appellant,
however, relies on the observation made by the Trial Court
17
that it was not open to the Superintending Engineer to
modify the rates of CSR with retrospective effect. This
argument does not commend us. The effect of typographical
error in the CSR applicable for the financial year 1981-82,
is not one of modification of the rates as such. Whereas, the
effect of correcting the typographical error in the CSR rates
is to restate the correct position as applicable for the
relevant period and not one of modification of the rates, as
contended. It is not disputed that in the previous financial
year 1979-80, the rate prescribed in the CSR was Rs.27.60
per cubic metre. In the following financial year 1980-81, it
was Rs.28.55 per cubic metre. It is, therefore, logical and
rational to accept the stand taken by the respondents that
the rates specified for pitching work in the year 1981-82,
were erroneously mentioned in square metres which worked
out @ Rs.80.33 per cubic metre. In the next financial year
i.e. 1982-83, the rate prescribed for the same work was only
Rs.46.65 per cubic metre. Thus, correcting the
typographical error in the CSR rates was not an act of
modification of those rates as such. That act cannot be
18
construed as retrospective change introduced in the CSR by
the respondents. The High Court has justly rejected this
plea by giving an illustration that if the CSR rates were to
be misprinted as Re.1 or Rs. 2 per cubic metre for the
financial year 1981-82, the appellant would not have agreed
to be bound by such rate.
11. Suffice it to observe that we find no error, much less
any infirmity in the approach of the High Court in
disallowing the claim of the appellant concerning pitching of
stones to the extent of Rs.1,76,199/-. The view taken by the
High Court, in our opinion, is just and proper, and a
possible view. We find force in the argument of the
respondents (defendants) that the Trial Court misled itself
in misreading the pleading and discarding the legal
evidence relied upon by the respondents (defendants)
concerning Claim No.1. Further, the Trial Court has
selectively referred to the deposition in the cross
examination of DW1 and not analysed his evidence as a
19
whole. Hence, no interference is warranted at the instance
of the appellant in respect of Claim No.1.
12. Reverting to the Claim No.3 set up by the appellant
regarding additional lead for water, we find that the Trial
Court was swayed away by the fact that the appellant was
required to transport water from some distance via Kaccha
Road for which the appellant was entitled to such claim.
The High Court in paragraph 21 of the impugned judgment,
however, considered the said claim of the appellant with
reference to the contract document. In that, Clause “d” of
tender Item No.8, pertaining to watering and mechanized
compaction of earth work, clearly stated that the rates for
earthwork raising are inclusive of watering and compaction
at optimum moisture content. Further, in Clause “d” of Item
No.8, it has been made amply clear that no extra payment
for these items would be given. The High Court held that
the appellant having accepted the terms in the contract,
which did not provide for any extra payment relating to lead
for water, was not entitled to that claim. The High Court
also took note of the document issued by the Executive
20
Engineer dated 19th June, 1981 which also forms a part of
record at Exh.-65A and noted that it reinforced the stand of
the respondents that the appellant was not entitled to grant
of the amount of Rs.80,000/- for additional lead for water.
We find no infirmity in the view so taken by the High Court.
The Claim of the appellant under this head is not supported
by express terms of the contract document. As a result, no
interference is warranted even with the conclusion reached
by the High Court in relation to Claim No.3 set up by the
appellant.
13. As no other issue arises for our consideration in this
appeal, the appeal must fail.
14. Accordingly, appeal is dismissed with costs.
.…………………………………….J.
(Dipak Misra)
…….……………………………….J.
(A.M. Khanwilkar)
New Delhi,
Dated: August 23, 2017.