GOVERNMENT OF SINDH through Secretary Irrigation and another vs Haji
This matter arises from a petition for leave to appeal filed by the Government of Sindh against a judgment of the Sindh High Court, which upheld a decree granted in favor of the respondent for the recovery of money based on a construction contract. The core legal question was whether a suit could be summarily decreed under Order XII, Rule 6 of the Code of Civil Procedure on the basis of clear admissions of liability in the defendant's written statement, despite the defense of non-receipt of funds from the Federal Government. The Supreme Court held that the High Court was fully justified in decreeing the claim owing to the explicit and candid admissions regarding the award of the contract, project completion, and financial liability. The key principle laid down is that where a defendant unequivocally admits liability in its pleadings, a judgment and decree can lawfully be passed under Order XII, Rule 6 of the Code of Civil Procedure 1908, and the lack of funding from a third party does not absolve the government from its contractual obligations.
- Whether a suit can be decreed on admissions made in the written statement under Order XII, Rule 6 of the Code of Civil Procedure 1908?
- Does the lack of release of funds by the Federal Government constitute a valid legal defense for a provincial government to withhold payment under a completed construction contract?
- Whether an appellate court is justified in upholding a decree passed on clear and candid admissions of liability?
- Order XII Rule 6, Code of Civil Procedure 1908
' RANA BHAGWANDAS, J.--- Petitioners claim leave to appeal against Sindh High Court judgment, dated 12-3-2003 passed in Appeal No,261 of 2002 upholding judgment, dated 28-5-2002 passed by Single Judge of the Sindh High Court in a suit for recovery of Rs,75,10,239 filed by respondent against the petitioners.
2. Respondent as a result of a construction contract with the petitioners and on completion of project submitted final bill in the sum of Rs,75,10,239 for payment but without any response. He was, therefore, constrained to file a suit for recovery of the above amount along with 15% profit per annum from 7-12-1989 till realization. Petitioners in paragraph 4 of the written statement pleaded as under:-- "(4) that the contents of para. No,4 of the plaint, it is submitted that the payment of the first running account bills of all the seven works of the above-named construction company were paid from bridge finance budget whereas no funds from Federal Government were received so far. The Irrigation and Power Department/answering defendant making all efforts for getting the funds released from Federal Government for 15 schemes under flood protection schemes of Sindh Province to the extent of Rs,5,23,400 millions. The payment can only be made when all the demanded funds are provided by the Federal Government to the answering defendant."
3. In view of clear and candid admission in respect of claim of respondent without denying their liability and expressing their inability only for want of release of funds by the Federal Government, respondent moved an application under provisions of Order XII, rule 6 of the Code of Civil Procedure for judgment and decree in the suit amount. In view of the circumstance that the claim of the respondent stood further corroborated by admissions in paragraphs 7, 11 and 13 of the written statement learned Single Judge in the High Court decreed the suit in the suit amount with mark-up at the 'rate of 14% per annum from the date of institution of the suit till realization.
4. Instead of complying with fair and lawful judgment and decree of the High Court petitioners, challenged the judgment before the Division Bench of the High Court which has been dismissed through the impugned judgment, hence this petition.
5. We have heard Ch. Muhammad Rafiq, learned Additional Advocate-General Sindh on behalf of the petitioners and gone through the pleadings of the parties as well as impugned judgment of the High Court.
6. On perusal of record and specific admissions in the pleadings of the petitioners, we are firmly of the opinion that the High Court was perfectly justified in decreeing the claim of the respondent and dismissing the High Court appeal filed by the petitioner-Government. In view of specific and candid admission of the award of contract, completion of project and liability of the Government of Sindh to pay up the amount of the final bill, there was hardly an issue which could be agitated before the Single Judge or before the Division Bench. Entire exercise on the part of the petitioners, in our opinion was uncalled for and futile. The petitioners, in law, were bound to honour the decree passed by a competent Court of law muchless the prestigious High Court of a Province.
7. No question of law in our view arises out of the impugned judgment. We are, therefore, not inclined to grant leave to appeal and would dismiss the petition which is frivolous on the face of record. It is accordingly dismissed.