A.BANERJI, J. - (1.) THESE two First Appeals from Orders raise identical questions of law and can, therefore, be conveniently decided by a common order.
(2.) FIRST Appeal from Order No. 445 of 1977 arises out of a decision dated 5-7-1977 in Civil Miscellaneous Case No. 184 of 1976 between State of Uttar Pradesh v. The Hindustan Construction Company Limited of Bombay (hereinafter referred to as the 'Company'). The Company entered into an agreement for construction of Civil Works on Yamuna Hydel Project, Stage II, Part I. The Company undertook the construction of diversion across river Tons at Ichari, intake works, head race tunnel, surge tank underground power house at Chibro with its appurtenant works, exit works at Chibro and a Syphon tunnel below river Tons at Chibro. The contract was executed on 5-2-1966. One of the stipulations in the contract was that certain materials were to be furnished by the Government. Para 12.05(c) related to the supply of Steel. It stated: "Steel- Government will issue steel to the contractor if available in the stores of the engineer-in-charge. The weight of the steel shall be based on the supplier's sectional tables. The contractor shall pay for all steel, issued to him at the F. O. R. Dehradun prices of steel at column I rates plus extra charges as notified by the Government of India as applicable on March 31, 1963 plus two per cent Central Sales Tax. In addition a sum of Rs. 35.00 per tonne or Rs. 50.00 per tonne will be charged on the steel in lieu of handling transportation and storage charges according as it is issued at Dehradun stores or Dakpathar/Dhakrani/ Dhalipur stores respectively."
(3.) IT appears that fabrication work in steel was required to be made for execution of the project. Subsequently, it transpired that the steel to be used had to be imported. Since the Company had a factory at Poona, a supplemental agreement was entered into on 15-3-1969. This agreement purported to modify Para 12.05(c) of the principal agreement. IT will be relevant to quote the same. "And whereas Government imported certain steel plates from Japan for fabrication of penstocks and appurtenant liners required for the said work and the Contractor has requested the Government to deliver the said steel F. 0. R Poona, the delivery to the Contractor has arranged to get fabrication work done on its behalf by its sub- contractor Messrs Indian Hume Pipe Company, Poona and the Government has agreed to arrange delivery F. O. R Poona on conditions firstly, that the rate to be recovered from the Contractor shall be as mentioned in Cl.12.05 (c) and secondly that no payment to the Contractor shall be made for transport or handling etc. of fabricated materials from Poona to work site and thirdly, that the Steel plates so delivered shall be secured by a Bank Guarantee to the satisfaction of the Govt. and lastly that instead of the procedure for recovery against steel laid down in Cl.5.03(i) of the Principal Agreement, the recovery for the aforesaid steel shall be made from the Contractor progressively as the finished work for furnishing and installing the said liners is measured and paid for in the intermediate bills.";