NDLI: Lakshmichand & Balchand Vs. State of Andhra Pradesh

Content Provider	Supreme Court of India
e-ISSN	30484839
Language	English
Access Restriction	NDLI
Subject Keyword	Power of the Court to allow set off
Content Type	Text
Resource Type	Law Judgement
Jurisdiction	India
Act(s) Referred	Code of Civil Procedure, 1908 (5 of 1908)
Case Type	Appeal
Court	Supreme Court of India
Disposal Nature	Appeal Allowed
Headnote	Civil Procedure Code, 1908-order 21, Rule 18-Power of the Court to allow set off-When is a claim founded on doctrine of equitable set off.The appellant contractor entered into two agreements with the respondent State for carrying out certain road repairing works. Clause68 of the agreement provided for preparation or the final bill of the contractor after taking into account amounts received by him earlier,while clause 71 permitted the State to retain or deduct money due under the contract from an amount due to the contractor under any other contract. While the work was in progress the contractor made certain claims in respect of loss suffered on account of delay, escalation of ratesand other heads. The arbitrator held the contractor entitled to Rs.99 lacs. The civil court refused to pass a decree in terms of the award. TheHigh Court on appeal allowed the claim to the extent of Rs.16 lacs together with interest. The contractor claimed recovery of decretal amount with interest in terms of the award and cost of execution proceedings. The respondent State contested the claim contending that asum of Rs.22 lacs was recoverable from the appellant and claimed adjustment against the amount due under the decree. The ExecutingCourt held the respondent State entitled to set off.In the revision petition before the High Court it was contended for the appellant that the respondent State was not entitled to set off in execution proceedings, and that the sum of which adjustment was sought consisted of (a) an amount claimed by respondent State as due to it upon preparation of the final bill in respect of the contracts covered by the award, and (b) an amount claimed by the respondent State under a separate contract on the ground that the appellant bad committed a breach of that contract. The High Court having regard to cl. 68 of the agreement found the respondent State entitled to set off so far as the first claim was concerned. It justified the second claim also by reference to cl. 71 of the contract hut held that adjustment claimed could not be made against the decretal amount hut must await determination upon the arbitration.
Judge	Honble Mr. Justice R.S. Pathak
Neutral Citation	1986 INSC 224
Petitioner	Lakshmichand & Balchand
Respondent	State Of Andhra Pradesh
SCR	[1987] 1 S.C.R. 108
Judgement Date	1986-11-05
Case Number	4083

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