The Patna High Court upheld the Tribunal’s view that the department owed him nothing more.
The Court relied on the fact that he had already accepted full and final payment in the measurement book.
The civil revision was dismissed, so the award remains in force.
Case Background
The dispute started with a road construction contract on National Highway 106 in Madhepura district. The work was for “Construction of IRQP (Improvement of Riding Quality Programme)” from 77 km to 88 km, under agreement no. 33F2 of 2006-2007.
The estimated cost was Rs. 5,00,42,744/-. The work was to start on 17.01.2007 and finish by 16.07.2007, that is, within six months. The petitioner was the lowest bidder and entered into the agreement with the Executive Engineer, N.H. Division, Madhepura.
According to the petitioner, some dispute between the PWD (Road) Department and the Forest Department stopped the work. The Forest Department objected to felling trees along the roadside, FIR was registered, and work halted. Later, this dispute was resolved.
Despite this, the contractor could not finish the job within time. The Executive Engineer therefore rescinded the contract by office order no. 20 dated 04.07.2008.
The contractor approached the Patna High Court in CWJC No. 11824 of 2008. On 20.08.2008, the High Court stayed the operation of the rescission order dated 04.07.2008 and directed the contractor to complete the work by November 2008. If he failed, the department was free to act as per law.
Immediately after this order, the entire Madhepura district was hit by unprecedented flood due to breach of Kushaha Bandh on river Koshi. The petitioner claimed that the materials stored by the side of the road were washed away.
When water receded and normalcy returned, the contractor filed I.A. No. 6700 of 2008 seeking more time. He undertook to complete the work by end of February 2009. On this undertaking, the High Court, by order dated 02.03.2009, extended the time for completion till March 2009.
The petitioner asserted that he completed 100% of the work, including damaged portions, by doing extra work beyond the agreement. He said that by 02.03.2009 he had already completed 90% work including extra work, and the High Court then directed the Executive Engineer to prepare estimates for the extra work and pay for it along with work under the agreement.
He claimed to have completed all work, including extra work, before 31.03.2009 and to have reported this to the Court on 06.04.2009.
However, he alleged that no estimate for extra work was prepared and that payment was not made. He therefore filed a contempt petition, MJC No. 497 of 2011, before the High Court.
In the contempt proceedings, the Executive Engineer (respondent no. 4) denied that the contractor had completed the work or done extra work. In view of these rival stands, the High Court, by order dated 13.05.2015, disposed of the contempt case. It gave liberty to the contractor to move the Bihar Public Works Contracts Disputes Arbitration Tribunal for any claim under the Court’s earlier orders or under the contract.
What the Court Examined and Decided
Acting on this liberty, the contractor filed Reference Case No. 110 of 2015 before the Tribunal. He sought two main amounts.
First, Rs. 84,88,650/- was claimed as payment for extra work allegedly done by him. Second, Rs. 98,39,500/- was claimed as compensation for loss of materials kept along the roadside, which he said were washed away in the unprecedented flood.
He also argued that the time given to complete the project had been unreasonably short. Because of this, he said, he had arranged and placed all necessary materials—metal grade-II, grade-III, ½” stone chips, stone dust and so on—throughout the entire stretch from 77 km to 88 km in one go. He claimed to have started earth work on both sides of the road and to have suffered huge loss when the flood came.
The Executive Engineer and other departmental authorities strongly opposed his claim before the Tribunal. In their counter-affidavit, they stated that the petitioner had completed only 42.9% of the work.
They pointed out that the work should have been completed by 16.07.2007. On the contractor’s request, the period was extended from time to time, but he still failed to maintain the required progress. Various letters were issued to him.
By letter no. 254 dated 17.04.2007 he was directed to show progress, failing which the department would take action under the contract. Another letter no. 272 dated 04.05.2007 reminded him to speed up the work, complete it, and install machinery and plants on site.
As he still did not show progress, he was asked by memo no. 254 dated 17.04.2007 to explain the delay so that his reply could be sent to higher authorities. With the scheduled completion date of 16.07.2007 approaching, no significant progress was made. Letter no. 486 dated 06.07.2007 was again issued.
On the contractor’s request, the Secretary, Road Construction Department, extended time till 31.12.2007 via letter no. 719 dated 27.11.2007. Even then, he failed to finish the work by 31.03.2008. Show-cause notices were issued through memo no. 541 dated 05.02.2008 and memo no. 90, asking why the contract should not be rescinded and security forfeited.
After he failed to respond adequately, another memo no. 202 dated 16.04.2008 was issued asking him to explain his failure. He then filed a show cause/affidavit promising completion by 30.06.2008, failing which the department could act. Despite this assurance, by 30.06.2008 he had completed only 42.9% of the work.
Finally, by letter no. 414 dated 26.06.2008, further show cause was sought. Finding his explanation unsatisfactory, the agreement no. 33F2/2006-07 was rescinded under clauses 3(a) and 3(c) of the contract by office order no. 20 dated 04.07.2008.
Regarding the flood damage, the respondents admitted that there was devastating flood in August 2008 affecting north Bihar including Madhepura and that part of NH-106, including the concerned stretch, was badly damaged.
They explained that the Road Construction Department, by letter no. 2/Astha/7-10-2008 dated 23.09.2008, constituted seven Task Forces in five affected districts, including Madhepura, to repair the roads and restore traffic. The District Magistrate, Madhepura, by letter no. 934-2 dated 15.02.2008, had directed the Chief Engineer, North Bihar Wing, to take immediate steps for restoration of traffic on nine key roads, including NH-106.
Following these directions, repair and restoration of the road from 77 km to 88 km of NH-106 was carried out by the Task Force, not by the petitioner. The respondents asserted that the petitioner did not do any repair or extra work after the flood. They described as “absolutely false” a chart produced by the petitioner (Annexure-3) claiming extra work.
According to them, after the department and Task Force completed the work, the Executive Engineer sent all records, including the measurement book, by letter no. 662 dated 24.07.2009. They further stated that all payments for work actually done by the contractor, including minor items, had already been made, as communicated through letter no. 494 dated 02.06.2009.
Most importantly, they said the final bill in full and final settlement of all claims had been prepared in measurement book no. 151, pages 94 to 100. The contractor had signed at page 99 in token of receiving the payment. From this, the department argued that he had already taken everything due to him, including any amounts under flood damage repair items 2 and 3 (Annexure-Q).
The Tribunal examined the pleadings and documents. It closely looked at the measurement book (Annexure-Q) and the contractor’s endorsement there. It found that he had acknowledged receipt of the entire amount for work done in items 2 and 3 “in full and final satisfaction” and had signed thereon.
On this basis, the Tribunal held that no payment remained due from the authorities. Therefore, it concluded that the contractor was not entitled to any award for alleged extra work or for compensation for any claimed damage to materials. The reference case was dismissed by order dated 08.08.2016.
The contractor then filed Civil Revision No. 204 of 2016 before the Patna High Court challenging the Tribunal’s award. His counsel argued that the contract had been arbitrarily rescinded, that he had completed the work including extra work after the High Court’s earlier orders, and that the Tribunal had not properly considered his documents or recorded specific findings on his reference.
The High Court carefully reviewed the Tribunal’s order and the record. It noted as an admitted fact that the petitioner had not completed the work within six months and that, even after multiple extensions totalling about eleven months beyond 16.07.2007, only 42.9% work was completed.
The Court reproduced the sequence: show-cause notices, extensions till 31.12.2007 and 31.03.2008, and final rescission on 04.07.2008. It also noted that, although the earlier writ petition and interim orders gave him further chances, his claim of completion and extra work was strongly refuted by the Executive Engineer.
Critically, the High Court focused on the measurement book no. 151. It accepted the Tribunal’s finding that the petitioner had endorsed the measurements, accepted them, and received payment in the 29th and final bill as full and final settlement of all work done.
The Court observed that the petitioner had not raised any objection before the authority who measured the work. No material was produced to show that the work was not properly measured or that some work was left unmeasured.
From these facts, the High Court agreed with the Tribunal that the contractor had already been paid in full for whatever work he had actually done. Therefore, he could not later claim additional sums under the heads of extra work or flood damage compensation.
The Court rejected the argument that the Tribunal had ignored his documents. It held that the Tribunal had considered the entire material and, relying on his own endorsement and acceptance of final payment, had rightly dismissed the reference.
Finding no illegality or material irregularity in the Tribunal’s order, the Patna High Court dismissed the civil revision as devoid of merit.
Why This Judgment Matters
This judgment is important for contractors working on government projects in Bihar and elsewhere. It shows that once a contractor signs the measurement book and accepts the final bill in “full and final satisfaction”, it becomes very difficult to later claim extra amounts.
Even serious events like floods, which may damage stored materials or roads, will not automatically lead to extra compensation, especially when government records show that repairs were done by departmental task forces and not by the original contractor.
For public departments, the decision confirms that proper documentation—letters showing extensions, show-cause notices, measurement books, and final payment endorsements—can protect them against later claims.
For ordinary people and small contractors, the key lesson is to be very cautious before signing the final measurement book. If they believe some work has not been paid for or some loss is yet to be compensated, they should record their objections in writing before accepting the final bill.
Legal Issues and Answers
Issue: Whether the contractor was entitled to additional payment for alleged extra work and compensation for flood damage under the road contract.
Answer: No. The Patna High Court held that he had already accepted full and final payment as recorded in the measurement book, and there was no evidence of unpaid work or uncompensated damage.
Issue: Whether the Tribunal’s dismissal of the reference case suffered from any illegality or material irregularity warranting interference in civil revision.
Answer: No. The Court found that the Tribunal had properly appreciated the evidence, especially the measurement book and the petitioner’s endorsement, and its findings could not be disturbed.
Cases Cited by the Court
- No previous judgments are cited or relied upon in the text of this decision.
Case Details
Case Number: Civil Revision No. 204 of 2016
Case Title: Dinesh Kumar Yadav v. The State of Bihar and Others
Court: High Court of Judicature at Patna
Coram: Hon’ble Mr. Justice Prabhat Kumar Jha
Date of Judgment: 25.04.2019
Citation: 2019 (2) PLJR 1231
Advocates: Mr. Uma Shankar Tiwary for the petitioner; Mr. Kameshwar Prasad Gupta, GP X, for the respondents
Nature of the Case: Civil revision against an award of the Bihar Public Works Contracts Disputes Arbitration Tribunal in Reference Case No. 110 of 2015
Impugned Award: Tribunal’s order dated 08.08.2016 dismissing the contractor’s reference
Link to Judgment: Patna High Court official judgment link
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