Full Judgment Text
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 85728573/2022
ARISING OUT OF SLP (C) NOS. 1600916010 OF 2019
FOOD CORPORATION OF INDIA & ORS. ....APPELLANT(S)
VERSUS
ABHIJIT PAUL …RESPONDENT(S)
WITH
CIVIL APPEAL NOS.85748579/2022
ARISING OUT OF SLP (C) NOS. 1606316068 OF 2019
WITH
CIVIL APPEAL NOS.85808581/2022
ARISING OUT OF SLP (C) NOS. 40454046 OF 2021
J U D G M E N T
PAMIDIGHANTAM SRI NARASIMHA, J.
Leave granted.
1.
1
2. Food Corporation of India , the Appellant herein, procures and
distributes foodgrains across the length and breadth of the country
Signature Not Verified
as a part of its statutory duties. In the process, it enters into many
Digitally signed by
Rajni Mukhi
Date: 2022.11.18
16:46:28 IST
Reason:
contracts with transport contractors. In one such contract, the
1 hereinafter referred to as ‘Corporation’.
Page 1 of 24
subject matter of present appeals, the Corporation empowered itself
(under clause XII (a)) to recover damages, losses, charges , costs and
other expenses suffered due to the contractors’ negligence from the
sums payable to them. The short question arising for consideration
is whether the demurrages imposed on the Corporation by the
Railways can be, in turn, recovered by the Corporation from the
contractors as “charges” recoverable under clause XII (a) of the
contract. In other words, does contractors’ liability for “charges”, if
any, include demurrages?
3. The Single Judge and the Division Bench of the High Court of
Tripura have held that demurrages cannot be recovered as a charge
by the Corporation. After examining the contract in its entirety,
including its nature and scope, we conclude that the parties did not
intend to include liability on account of demurrages as part and
parcel of the expression “charges”. The liability of the contractors in
the present contracts is clearly distinguishable from other contracts
entered into by the FCI in 2010 and 2018, having a different scope
and objective. Because of our conclusions, we have upheld the
judgments of the High Court and dismissed the appeals filed by the
Page 2 of 24
Corporation. Before considering the submissions, analysis and the
conclusions, we will refer to the necessary facts and contractual
provisions.
4. There are three appeals. In the first set of appeals arising out
of Special Leave Petition Nos. 1600916010 of 2019, the
Corporation notified a Tender inviting a bid from road transport
contractors for transporting foodgrains from railway siding,
Churaibari in Assam, to Food Security Depot Chandrapur in
Tripura, on a regular basis for a period of two years. The
Respondent – Mr. Abhijit Paul, was selected as the successful
2
tenderer . He deposited an amount of Rs. 44,95,000/ towards the
3
security deposit, leading to the execution of the contract . The
Corporation awarded several such Work Orders to the Respondent
and also to other contractors for transportation of foodgrains
between its multiple Food Security Depots.
5. The contract was discharged by performance by July 2014.
More than a year thereafter, by a letter dated 22.12.2015 followed
by a Notice dated 29.11.2016, the Corporation called upon the
2 hereinafter referred to as ‘contractor’.
3 Contract No. Cont.9/NEFR/TC/CBZCDR/2011 dated 25.04.2012, hereinafter referred to as
‘Work Order’ or the ‘contract’.
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contractor to reimburse the amount of demurrages imposed on it by
the Railways. As this demand was bereft of any reason and rightly
objected to, it was followed by another letter dated 27.06.2017 by
the Corporation. In this letter, the Corporation explained that it had
incurred heavy losses on account of demurrages due to the
contractor’s inability to readily provide trucks at railway sidings,
inhibiting the Corporation from unloading foodgrains from railway
wagons within the “free time” specified by the Railways. The
Corporation sought to recover the demurrages from the contractor
by withholding the security deposit tendered under the Work Order.
6. The contractor objected to this unilateral action, contending
that there was no power to recover demurrages under the Work
Order. Being unsuccessful in pursuing the Corporation to withdraw
the letters, demand and the unilateral action, the contractor filed a
4
writ petition before the High Court of Tripura for quashing the
illegal and arbitrary action.
7. This writ petition was allowed by the Single Judge of High
Court. It clarified that the Corporation was only entitled to recover
4 WP No. 1351 of 2016.
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losses that were incurred due to the contractor’s dereliction of
duties under the contract, as permissible under Section 73 of the
Indian Contract Act 1872, which provides for recovery of damages
for the breach of a contract. This would not permit the recovery of
losses that were causally distant from the contractor’s actions.
Further, it held that the Corporation had unilaterally determined
and imposed demurrages on the contractor, and directed it to settle
its claims through a civil suit of recovery. The Corporation filed a
5
writ appeal and the Division Bench of the High Court by its order
dated 07.09.2018 dismissed the same on the ground of delay. A
6
Review Petition filed by the Corporation was also dismissed by the
Division Bench of the High Court on 22.01.2019. The present
appeals are against the orders in the writ appeal as well as in the
review.
The second set of civil appeals are also filed by the
8.
Corporation. It arises out of Special Leave Petition Nos. 16063
16068 of 2019 and it impugns the decision of the Division Bench of
the High Court of Tripura dated 15.05.2019. Therein, the High
5 Writ Appeal No. 56 of 2018.
6 Review Petition No. 02 of 2019.
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Court similarly dismissed the writ appeals on the ground that the
Corporation had no power to recover demurrages from contractors
under the clauses of the contract therein.
9. The third set of civil appeals, arising out of Special Leave
Petition Nos. 40454046 of 2021, are filed by the contractors. They
have challenged the orders of the Division Bench of the High Court
7
of Tripura dismissing their writ appeals and upholding the decision
of the Single Judge of the High Court dated 25.11.2019, directing
the contractors to avail alternative remedies.
10. Submission of Parties : Shri Neeraj Kishan Kaul, learned Senior
Counsel appearing on behalf of the Appellant started his
submissions preempting a preliminary objection about the
dismissal of a Special Leave Petition against an adverse order of the
8
High Court on the same issue , and relatedly, about not appealing
another adverse decision of the High Court of Tripura on identical
9 10
issues . Relying on State of Maharashtra v. Digambar , he
submitted that the dismissal of a Special Leave Petition at the
7 Writ Appeals Nos. 186 of 2020 dated 04.01.2021 and 187 of 2020 dated 18.01.2021.
8 SLP No 3391 of 2018, dismissed in limine on 26.03.2018.
9 Writ Appeal Nos. 2527 of 2016 (Tripura High Court)
10 (1995) 4 SCC 683.
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admission stage did not operate as res judicata. He also explained
that the Corporation refrained from appealing against the
aforementioned judgment of the High Court because the amount
recoverable therein was low. Moreover, in those cases, the
Corporation had already issued No Dues Certificates to the
contractors.
11. Before proceeding any further, we make it clear here itself that
we do not propose to dismiss the Corporation’s appeals on
preliminary objections. We will therefore consider Shri Kaul’s
submission on the merits of the case.
12. Referring to and relying on the contractual clauses, Shri Kaul
submitted that the expression “charges” in clause XII (a) of the
Work Order clearly includes demurrages, and the Corporation is
empowered to recover the same. He relied on the decision of this
11
Court in Raichand Amulakh Shah and Anr. v. Union of India and
12
Trustees of the Port of Madras v. Aminchand Pyarelal & Ors to say
that demurrages constitute a charge He also submitted that the
.
11 (1964) 5 SCR 148.
12 (1976) 3 SCC 167.
Page 7 of 24
13
Handbook used by Corporation would demonstrate that “charges”
certainly include “demurrage”.
13. Supplementing the above submissions, Shri Ajit Puduserry,
AOR submitted that in the construction of contractual terms, the
interpretation proposed by the author of the tender document must
be relied on. He referred to Agmatel India Pvt Ltd v. Resoursys
14
Telecom & Ors for this purpose. He further submitted that the
action of the Corporation is unexceptionable as it merely followed
the directions of the High Court in an earlier round of litigation
where the court directed it to issue notice before taking a decision
on the contractors’ liability. It is his contention that notices were
accordingly issued before recoveries were made. Appearing on
behalf of the Corporation in the third appeal, Shri Abhay Kumar,
AOR, supported the arguments of the Appellant Corporation on the
same grounds.
14. Shri Sanjay Parikh, learned Senior Counsel appearing on
behalf of the Respondents submitted that the Corporation acted
arbitrarily. It failed to follow due process of law to determine the
13 Movement Operations in Food Corporation of India (FCI Handbook 2020).
14 (2022) 5 SCC 362.
Page 8 of 24
liability of the contractors, despite specific instructions in a
previous round of litigation. He also submitted that contractors
were not responsible for loading and unloading of foodgrains from
railway wagons. Hence, the event which leads to the incurrence of
demurrages, i.e., delayed unloading of foodgrains from railway
wagons, was not within the scope of contractor’s responsibilities. He
took us through the contracts that were executed in 2010 and 2018
by the Corporation, which delegated the task of loading and
unloading the foodgrains to contractors, and therefore the relevant
expression “demurrages” was present in the liability clauses in
those contracts.
15. Supplementing the above submissions, Shri Shoeb Alam,
Advocate, submitted that the Corporation was not entitled to be a
judge in their own cause and to unilaterally determine the liability
with respect to demurrages. He placed reliance on
State of
15
Karnataka v. Shree Rameshwara Rice Mills , BSNL and Anr. v.
16 17
Motorola India (P) Ltd and J.G. Engineers (P) Ltd v. Union of India .
15 (1987) 2 SCC 160.
16 (2009) 2 SCC 337.
17 (2011) 5 SCC 758.
Page 9 of 24
Analysis:
16. The core question arising for our consideration is whether the
contractual clause enabling the Corporation to recover “charges”
includes the recovery of demurrages. It is pertinent to extract the
relevant clauses of the road transport contract , i.e., Work Order.
The clauses detailing the description of work, liability of the
contractors, and the power to recover losses, which are identical in
the three appeals before us, read as under:
“ (B) Brief description of work :
i) Transportation of foodgrains from
Depots/Mandis/Rail Heads of Churaibari to various
destinations as per AppendixI...
...
X. Liability of Contractor for losses suffered by
Corporation
a) The Contractor shall be liable for all costs, damages,
registration fees, charges and expenses suffered or
incurred by the Corporation due to the Contractor's
negligence and unworkmanlike performance of any
services under this Contract, or breach of any terms of
the Contract, or failure to carry out the work under the
Contract, and for all damages or losses occasioned to
the Corporation, or in particular to any property or plant
belonging to the Corporation, due to any act whether
negligent or otherwise, of the Contractor or his
employees. ...
...
XII. Recovery of losses suffered by the Corporation
(a) The Corporation shall be at liberty to reimburse
themselves for any damages, losses, charges, costs or
expenses suffered or incurred by them, or any amount
payable by the Contractor as Liquidated Damages as
provided in Clauses X above. The total sum claimed
shall be deducted from any sum then due, or which at
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any time thereafter may become due, to the Contractors
under this, or any other, Contract with the Corporation.
In the event of the sum which may be due from the
Contractor as aforesaid being insufficient, the balance
of the total sum claimed and recoverable from the
Contractors as aforesaid shall be deducted from the
Security Deposit, furnished by the contractor as
specified in Clause IX... ”
(emphasis supplied)
17. The Corporation seeks to recover demurrages as a part of
“charges” provided under clause XII(a) as extracted hereinabove.
The expression “charges”, stand alone, is not amenable to a precise
meaning. Its dictionary meaning is open textured, defining
“charges” as “any consideration that one must pay for goods and
services provided”. Therefore, the scope of the expression “charges”
must be understood as intended by the parties to the contract. The
process of interpretation, though the exclusive domain of the Court,
inheres the duty to decipher the meaning attributed to contractual
terms by the parties to the contract. It is with this purpose that we
shall now proceed to understand the meaning of the expression
“charges”.
18. There are certain basic principles evolved by courts of law for
deciphering the true and correct meaning of expressions in a
Page 11 of 24
contract. In Bihar State Electricity Board, Patna and Ors. v. M/s
18
Green Rubber Industries and Ors. , this Court observed that,
“Every contract is to be considered with reference to its object and
the whole of its terms and accordingly the whole context must be
considered in endeavouring to collect the intention of the parties,
even though the immediate object of enquiry is the meaning of an
isolated clause. ”
19
19. In Union of India v. Raman Iron Foundry , this Court held that
contractual terms cannot be interpreted in isolation, following strict
etymological rules or be guided by popular connotation of terms, at
variance with the contractual context. It observed:
“ It is true that the words “any claim for the payment
8.
of a sum of money” occurring in the opening part of
Clause 18 are words of great amplitude, wide enough
to cover even a claim for damages, but it is a well
settled rule of interpretation applicable alike to
instruments as to statutes that the meaning of ordinary
words is to be found not so much in strict etymological
propriety of language nor even in popular use as in the
subject or occasion on which they are used and the
object which is intended to be attained. The context and
collocation of a particular expression may show that it
was not intended to be used in the sense which it
ordinarily bears. Language is at best an imperfect
medium of expression and a variety of meanings may
often lie in a word or expression. The exact colour and
shape of the meaning of any word or expression should
not be ascertained by reading it in isolation, but it
18 (1990) 1 SCC 731, ¶23.
19 (1974) 2 SCC 231.
Page 12 of 24
should be read structurally and in its context, for its
meaning may vary with its contractual setting. We
must, therefore, read the words ‘any claim for the
payment of a sum of money’ occurring in the opening
part of Clause 18 not in isolation but in the context of
the whole clause, for the intention of the parties is to be
gathered not from one part of the clause or the other but
from the clause taken as a whole. It is in the light of
this principle of interpretation that we must determine
whether the words ‘any claim for the payment of a sum
of money’ refer only to a claim for a sum due and
payable which is admitted or in case of dispute,
established in a Court of law or by arbitration or they
also include a claim for damages which is disputed by
the contractor.”
(emphasis supplied)
20. In Provash Chandra Dalui and Anr. v. Biswanath Banerjee and
20
noting that the intention of the parties must be discerned
Anr. ,
from the context of the contract, this Court observed:
“ 10. ‘Ex praecedentibus et consequentibus optima fit
interpretatio.’ The best interpretation is made from the
context. Every contract is to be construed with reference
to its object and the whole of its terms. The whole
context must be considered to ascertain the intention of
the parties. It is an accepted principle of construction
that the sense and meaning of the parties in any
particular part of instrument may be collected ‘ex
antecedentibus et consequentibus;’ every part of it may
be brought into action in order to collect from the whole
one uniform and consistent sense, if that is possible.
...
In construing a contract the court must look at the
words used in the contract unless they are such that
one may suspect that they do not convey the intention
correctly. If the words are clear, there is very little the
court can do about it. In the construction of a written
instrument it is legitimate in order to ascertain the true
meaning of the words used and if that be doubtful it is
20 1989 Supp (1) SCC 487.
Page 13 of 24
legitimate to have regard to the circumstances
surrounding their creation and the subject matter to
which it was designed and intended they should
apply.” (emphasis supplied)
21
21. In BESCOM v. E.S. Solar Power Pvt Ltd and Ors , this Court
held that in case of two possible interpretations of a contractual
term, the court must accord primacy to the one that is consistent
with the underlying purpose of the contract. It noted:
“ 17. ... In seeking to construe a clause in a contract,
there is no scope for adopting either a liberal or a
narrow approach, whatever that may mean. The
exercise which has to be undertaken is to determine
what the words used mean. It can happen that in doing
so one is driven to the conclusion that clause is
ambiguous, and that it has two possible meanings. In
those circumstances, the court has to prefer one above
the other in accordance with the settled principles. If
one meaning is more in accord with what the court
considers to be the underlined purpose and intent of the
contract, or part of it, than the other, then the court will
choose the former or rather than the latter...”
(emphasis
supplied)
22. Keeping in mind the above referred principles we have to
examine the expression “charges” in the context of its related words
in the contract, which are costs, damages, registration fees, and
expenses. These expressions indicate the different heads under
which losses are recoverable from the contractors for acts of
21 (2021) 6 SCC 718.
Page 14 of 24
negligence, unworkmanlike performance of any service, breach of
terms and failure to carry out the work in the context of the
working of the contract. These expressions are equally wide and do
not aid us in understanding the meaning of the expression
“charges”. Under these circumstances, we have to understand the
meaning of the expression “charges” in the larger context of the
contract.
23. The preamble of the contract, i.e., the Work Order, reads that
the contractor is engaged for “ transportation of foodgrains from
depots, mandis, rail heads of Churaibari to various destinations as
per appendix 1 ”. Further, clause XIII of the Work Order detailing the
responsibilities of the contractor, to the extent relevant for our
purposes, reads as under:
XIII. Responsibilities of the Contractor
(a) The Contractor shall be responsible to supply adequate
and sufficient number of trucks for transportation of food
grains and carrying out any other services under the
Contract in accordance with the instructions issued by the
General Manager or an officer acting on his behalf.
...
(f) The Contractor shall be responsible for the safety of the
goods from the time they are loaded on their truck from
godowns/mandis/rail heads until they have been unloaded
from the trucks at godowns or at other destinations as
specified in the Contract or as directed by the General
Manager/Area Manager or any other officer acting on his
behalf... ”
(emphasis supplied)
Page 15 of 24
24. We have scanned the entire contract, in addition to
scrutinising the provisions extracted above, and seen that there is
no contractual provision requiring the contractors to undertake the
task of loading and unloading of foodgrains from the railway
wagons. This is confirmed by the written submissions on behalf of
the Corporation, where the imposition of demurrages is justified
only for the reason that the contractor did not provide adequate
number of trucks near the railway sidings, to enable the
Corporation to promptly hand over the foodgrains to them to
commence transportation. The relevant portion is extracted as
under:
“ 10. The reason why demurrage charges get levied
during the performance of an RTC contract is on
account of the failure of the contractor to supply
required number of trucks even after prior intimation
about the placing of the railway rakes due to which the
Petitioner is unable to empty the wagons as the
foodgrains are liable to get spoiled if they are unloaded
onto the siding due to rain etc. Even after unloading
unless they are removed from the railway premises
within the free time available wharfage is charged by
the Railways. The failure to prove trucks leads to
detention of wagons beyond the free time allowed by
the Railways... ”
25. We may note that there is a dispute about the availability of
trucks for the transportation of foodgrains by the contractor. While
Page 16 of 24
the Corporation asserts that trucks were not made available in
numbers as well as in time, the contractor denies the same stating
that their trucks were kept waiting at the Corporation’s Food
Security Depots.
26. Irrespective of the disputed fact, the real question is whether
the contractors had any obligation towards loading and unloading
of foodgrains from the railway wagons. It is evident from the
contractual provisions and also the admissions of the Corporation
in written submissions, that the task of loading or unloading of
foodgrains from the railway wagons was not a part of the contract.
Thus, based on interpretation of the expression “charges” in the
contractual context, we are of the opinion that it did not include
liability on account of demurrages. Consequently, the Corporation
cannot impose and collect demurrages from the contractors.
27. Interpretation of contracts concerns the discernment of the
true and correct intention of the parties to it. Words and
expressions used in the contract are principal tools to ascertain
such intention. While interpreting the words, courts look at the
expressions falling for interpretation in the context of other
Page 17 of 24
provisions of the contract and also in the context of the contract as
a whole. These are intrinsic tools for interpreting a contract. As a
principle of interpretation, courts do not resort to materials external
to the contract for construing the intention of the parties. There are,
however, certain exceptions to the rule excluding reference or
reliance on external sources to interpret a contract. One such
exception is in the case of a latent ambiguity , which cannot be
resolved without reference to extrinsic evidence. Latent ambiguity
exists when words in a contract appear to be free from ambiguity;
however, when they are sought to be applied to a particular context
or question, they are amenable to multiple outcomes. This position
22
is wellexplained in the following passage of
Halsbury’s :
“ Latent ambiguity: When the instrument appears
on its face to be free from ambiguity but, upon the
endeavour being made to apply it to persons or
things indicated, it appears that the words are
equally applicable to two or more persons, or two
or more things, either without any inaccuracy or
with a common inaccuracy... ”
22 Halsbury’s Laws of England (5th edn, 2012) vol 32, para 409.
Page 18 of 24
Extrinsic evidence, in cases of latent ambiguity, is admissible both
to ascertain where necessary, the meaning of the words used, and
23
to identify the objects to which they are to be applied.
28. Applying the abovereferred principles to the present case, we
will juxtapose the present contracts with similar but not identical
contracts entered into by the Corporation, to confirm our
interpretation that the word “charges” in the contract is exclusive of
liability for demurrages. Pursuantly, we will examine certain
contracts entered into by the Corporation with other transporters.
For example, we will refer to a contract entered into by the
Corporation in 2010, which is prior in time to the present contract.
The relevant clauses read as under:
“
B. Brief description of work
I. Unloading/Loading of foodgrain bags from/into
railway wagons, trucks etc. stacking...and transporting
of foodgrains from Railway Station to Corporation’s
Godown or viceversa...”
XII. Liability of Contractors for losses etc.
suffered by Corporation
a) The contractor shall be liable for all costs,
damages, demurrages, wharfage, forfeiture of wagon,
registration fees, charges and expenses...due to...their
failure to carry out the work with a view to avoid
incurrence of demurrage etc ...
23 Halsbury’s Laws of England (5th edn, 2012) vol 32, para 394.
Page 19 of 24
b) The Corporation shall be at liberty to reimburse
themselves of any damages, losses, charges, costs, or
expenses suffered or incurred by them due to
contractors negligence and unworkmanlike
performance of service under the contract or breach of
any terms thereof... ”
(emphasis supplied)
29. It is evident from the above that the contracts delegating the
responsibility of loading and unloading of foodgrains from railway
wagons, as an integral part of the contract, include a clear and
distinctive clause for the imposition of liability, inter alia , on
account of demurrages. Evidently, the liability clause in these
contracts, termed the Handling and Transport Contracts, is starkly
distinct from the present Road Transport Contracts.
30. We have every reason to believe that the Corporation,
statutorily obligated to procure and distribute foodgrains across the
nation, enters into contracts depending on the services it requires.
These contracts naturally vary depending on the needs and
purposes of the Corporation. With the aid of the provisions in the
Handling and Transport Contract from 2010, we are able to
understand the intention of the parties while entering into the
present Road Transport Contracts. As the present contracts do not
Page 20 of 24
involve the task of loading and unloading of foodgrains from the
railway wagons as a part of the contractors’ responsibility, there is
no clause enabling the recovery of demurrages from them by the
Corporation. Thus, our interpretation of the expression “charges”,
as exclusive of liability for demurrages, stands confirmed.
31. We will proceed to examine yet another Handling and
Transport Contract which was executed seven years after the
present contract, i.e., in 2018. The relevant clauses of the contract
are as under:
“B. Brief description of work
I. Unloading/Loading of foodgrain bags from /into
railway wagons, trucks etc. stacking the foodgrains in
bags, bagging, weighment, standardization, cleaning of
foodgrains, etc., and transporting of foodgrains from
Railway Good Shed/siding to Corporation Godown or
viceversa or transporting them from any place to any
other place in and around Railhead KUMARGHAT/FSD
KUMARGHAT...
...
X. Liability of Contractors for losses etc.
suffered by Corporation
a) The contractor shall be liable for all costs,
damages, demurrages, wharfage, forfeiture of wagon,
registration fees, charges and expenses suffered or
incurred by the Corporation due to the contractor’s
negligence and un workmanlike performance of any
services under this contract, or breach of any terms
thereof or his failure to carry out the work with a view
to avoid incurrence of demurrage etc. under this
contract or breach of any terms thereof or his failure to
carry out the work with a view to avoid incurrence of
demmurage; etc. and for all damages or losses
occasioned to the Corporation due to any act whether
Page 21 of 24
negligent or otherwise of the contractor themselves or
his employees. The decision of the General Manager
regarding such failure of the contractor and their
liability for the losses, etc. suffered by the Corporation,
and the quantification of such losses, shall be final and
binding on the contractor ...”
(emphasis supplied)
32. It is evident from the above that the Handling and Transport
Contract from 2018, similarly involved loading and unloading of
foodgrains from the railway wagons within the scope of contractors’
duties, thereby necessitating the inclusion of demurrages as a
penalty for nonperformance of contractual duties. Thus, the
present Road Transport Contract is distinct from the Handling and
Transport Contract from 2018, as the responsibility of loading and
unloading of foodgrains from railway wagons is absent in the
present contract. For this reason, the Corporation in the present
contract has chosen not to include the power to recover demurrages
and as such the expression “charges” cannot be interpreted to
include demurrages.
33. In light of the foregoing conclusions, we are not inclined to
adopt a textual approach for the interpretation of the contractual
term “charges”, and hence, the decisions of this Court in Raichand
Page 22 of 24
24 25
Amulakh Shah and Trustees of the Port of Madras are of no aid,
as they simply describe demurrages as a charge. Demurrage is
undoubtedly a charge, however, such a textual understanding
would not help us decipher the true and correct intention of the
parties to the present contract.
34. For these reasons, Civil Appeals arising out of SLP Nos.
1600916010 of 2019 and SLP Nos. 1606316068 of 2019, filed by
the Corporation are dismissed. The decisions of the High Court of
Tripura in Writ Appeal No. 56 of 2018 dated 07.09.2018 and Review
Petition No. 02 of 2019 dated 22.01.2019 are upheld. The decision
of the High Court of Tripura in Writ Appeal Nos. 5358 of 2017
dated 15.05.2019 is also upheld. We may clarify that our decision
has no bearing on any other remedy available to the Corporation,
like the institution of a suit for recovery, if law enables them to do
so.
35. In so far as Civil Appeals arising out of SLP Nos. 40454046 of
2021 filed by the contractors are concerned, they are allowed for the
same reasons as indicated above. The judgments of High Court of
24 Supra note 11.
25 Supra note 12.
Page 23 of 24
Tripura in Writ Appeal Nos. 186 of 2020 and 187 of 2020 dated
04.01.2021 and 18.01.2021 respectively are setaside and the Civil
Appeals stand allowed.
36. The parties shall bear their own costs.
……………………………….J.
[A.S. BOPANNA]
……………………………….J.
[PAMIDIGHANTAM SRI NARASIMHA]
NEW DELHI;
NOVEMBER 18,2022
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