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of <h1>Supreme Court Upholds Contractor's Right to Claim Extra Payment Despite Accepting Final Bill</h1> <h3>R.L. Kalathia & Co. Versus State of Gujarat</h3> R.L. Kalathia & Co. Versus State of Gujarat - 2011 AIR 754, 2011 (1) SCR 391, 2011 (2) SCC 400, 2011 (2) JT 69, 2011 (1) SCALE 441 Issues Involved:1. Estoppel and Acceptance of Final Bill2. Execution of Extra Work and Entitlement to Additional Payment3. Validity of 'No Due Certificate' and Claims Post Final Bill4. Jurisdiction and LimitationSummary:1. Estoppel and Acceptance of Final Bill:The High Court dismissed the suit on the ground that the plaintiff was estopped from claiming damages as the final bill was accepted under protest. The High Court relied on Clauses 8 and 10 of the agreement, which stated that intermediate payments are advances and the final bill must be submitted within one month of work completion. The High Court concluded that the plaintiff's acceptance of the final bill without disclosing real grievances amounted to acceptance without valid objection. The Supreme Court, however, disagreed, stating that merely accepting the final bill under protest does not deprive the plaintiff of the right to claim damages for additional work performed.2. Execution of Extra Work and Entitlement to Additional Payment:The trial court had accepted the plaintiff's claims for additional work and awarded a decree for Rs. 2,27,758/- with interest. The Supreme Court upheld this, noting that the plaintiff had performed additional work as directed by the Department and was entitled to additional payment. The trial court's detailed examination of the issues, including extra work, excavation, construction of guide bunds, pitching work, providing sand filter in the river, waste weir backfilling, extra masonry, providing a heavy gate, additional amounts due to rising prices, and establishment charges, was found to be thorough and justified.3. Validity of 'No Due Certificate' and Claims Post Final Bill:The Supreme Court referred to precedents, including *Chairman and MD, NTPC Ltd. vs. Reshmi Constructions, Builders & Contractors* and *Ambica Construction vs. Union of India*, which held that a 'No Due Certificate' does not bar genuine claims if the contractor can prove additional entitlement. The Court emphasized that the necessity of signing such certificates under duress does not negate the contractor's right to claim additional amounts if substantiated by evidence.4. Jurisdiction and Limitation:The trial court had framed issues regarding the jurisdiction and the timeliness of the suit, which were not specifically addressed by the High Court. The Supreme Court, after reviewing the materials and the trial court's findings, agreed with the trial court's decision and found no merit in the High Court's reversal based on estoppel.Conclusion:The Supreme Court set aside the High Court's judgment and restored the trial court's decree, allowing the civil appeal with no order as to costs. The plaintiff was entitled to the awarded amount of Rs. 2,27,758/- with interest as determined by the trial court.
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