• Recovery suit under order 37

We are architects and worked for a project assigned to us by one of their division in the direction of the municipal commissioner, Gurugram. We had four stages of bill payments as per our given work order by the division. We were paid our professional payment of stage 1 on 25.09.2015 and stage 2 part payment on 11.03.2016 as executive engineer had cut 10% security deposit incorrectly, which should not have been cut as we were architect consultants and not the contractors. We had raised our stage 3 bill after submitting our tender document preparations dated June , 2016 and our bill was processed by the division but audit had objected our bill saying the project is not happening on the ground and being used for some other purpose. Now we as architect consultants are not responsible for the internal decision of the officials for not implementing our plans. MCG officials did not even informed us to stop our work. After that division had replied to Audit's objection that it is self explanatory that it was MCG's internal decision. But Audit objected second time to fix the responsibility of the officer who changed the decision. Now after that our bill is still not processed by MCG. We recently filed RTI's on 19.08.2018 & 22.10.2018 and we were denied the answer for our 3 points query and replied by MCG after filing first appeal that 'our payments are under process at CAO and we should get in touch with CAO at personal level'. We had visited CAO personally and we were told that our file is with division only and our payments will be done soon. Till today our payments are not released yet as well as we are not getting any response from the MCG Commissioner in written. Another time we filed an RTI on the same 3 points and the answer was again denied point-wise and we were informed that 'our payments are process with higher authorities and information will be sent after decision by Higher Authorities. Finally I had put my grievance on PMO PG portal and even after two months my grievance has not been resolved by MCG though they were given the deadline of 10 days to solve my grievance. 
What should I do?! And How shall I file my recovery suit?! I just have time till May to fight my case as I have heard that after 3 years I can't fight my case. Is it true?! I have been repeatedly sending requests to the higher authorities by emails and even by my self representations, but unfortunately received no response by them. 
Verbally executive engineer said that you are not liable to receive payment as there is a condition of payment on tenderisation. But we had prepared tender and if the authorities do not wish to implement that is not our fault. We should be paid for the hard work done. We were not even told to stop the work. 
Please guide. 
Can I file recovery suit without legal notice to Municipal Corporation of Gurugram?! Is legal notice to municipality mandatory?! 
And How shall I file under Order 37 Summery suit?! What should be the procedure?!
Asked 6 years ago in Civil Law

4 answers received in 10 minutes.

Lawyers are available now to answer your questions.

19 Answers

Dear Sir, MCG is a government body as I see. You can file a summary suit against them provided they have accepted their liability through a contract. Notice is mandatory to be given in case you file a suit against any government body or organization controlled by govt.

Mayank Sapre
Advocate, New Delhi
256 Answers

Firstly, you would have to serve a legal notice to the company asking them to repay the entire dues alongwith interest within 15 days of receipt of legal notice. Giving legal notice is mandatory, but can be exempted if the limitation period is about to expire.

If they fail to do so, you'll have to file a civil suit under order 37 CPC in civil court in order to recover the arrears from them.

Limitation period to file recovery suit is three years.

Siddharth Jain
Advocate, New Delhi
6617 Answers
102 Consultations

If you don’t take legal proceedings within period of 3 years your claim would be barred by limitation 

 

 

2) issue legal notice to muncipal corporation to pay your dues . 

 

3) if they don’t pay file summary suit under order XXXVII of code of civil procedure to recover your dues with interest 

Ajay Sethi
Advocate, Mumbai
99776 Answers
8145 Consultations

Notice is must but please mention in the notice full facts based on documentary evidence if they don't reply satisfactory then you have to file recovery suit before civil court Gurugram.

Koshal Kumar Vatsa
Advocate, Gurgaon
2282 Answers
3 Consultations

As a last and final measure, send them a legal notice, calling upon them to forthwith clear your dues. 

In case the notice fails to help, contact a local lawyer and engage him to prefer and represent you in the recovery suit proposed to be filed by you.

Also, was there an agreement in between you and them? If yes, is there is an arbitration clause in this agreement?

Vibhanshu Srivastava
Advocate, Lucknow
9763 Answers
323 Consultations

Hello,

1) You can file a recovery suit without issuing a legal notice to the Municipal Corporation if you choose to do so as the notice prior to instituting the suit is not mandatory.

2) However I would suggest that you get a legal notice issued first as this will help in placing all your contentions in a sequential manner and it would also be a final attempt on your part at avoiding a long drawn legal battle in the court.

3) Although the suit for recovery under Order XXXVII Rule  2 is summary in nature as suggested by the term 'summary suit', in reality it can take time for the disposal. In order to file a suit under the said provisions you have to calculate the exact amount that you are eligible to recover including the interest, have a clear particulars of claim and the claim for recovery must be based on certain bills, hundi or note issued by the defendant.

4) Let me quote the provision of law for your enlightenment:

ORDER XXXVII : SUMMARY PROCEDURE 5[***]

6[1. Court and classes of suits to which the Order is to apply

    (1) This Order shall apply to the following Courts, namely :-

        (a) High Courts, City Civil Courts and Courts of Small Causes: and

        (b) other Courts:

        Provided that in respect of the Courts referred to in clause (b), the High Court may, by notification in the Official Gazette, restrict the operation of this Order only to such categories of suits as it deems proper, and may also, from time to time, as the circumstances of the case may require, by subsequent notification in the official Gazette, further restrict, enlarge 6r vary, the categories of suits to be brought under the operation of this Order as it deems proper.

    (2) Subject to the provisions of sub-rule (1), the Order applies to the following classes of suits, namely:-

        (a) suits upon bills of exchange, hundies and Promissory notes:

        (b) suits in which the plaintiff seeks only to recover a debt or liquidated demand in money payable by the defendant, with or without interest, arising,-

            (i) on a written contract, or

            (ii) on an enactment, where the sum sought to be recovered is a fixed sum of money or in the nature of a debt other than a penalty; or

            (iii) on a guarantee, Where the claim against the principal is in respect of a debt or liquidated demand only.]

7[2. Institution of summary suits

    (1) A suit, to which this Order applies, may if the plaintiff proceed desires to desires hereunder, be instituted by presenting a plaint which shall contain,-

        (a) a specific averment to the effect that the suit is filed under this Order;

        (b) that no relief, which does not fall within the ambit of this rule; has been claimed in the plaint; and

        (c) the following inscription, immediately below the number of the suit in the title of the suit, namely :- 

        "(Under Order XXXVII of the Code of Civil Procedure, 1908)."

    (2) The summons of the suit shall be in Form No. 4 in Appendix B or in such other Form as may, from time to time, be prescribed.

    (3) The defendant shall not defend the suit referred to in sub-rule (1) unless he enters an appearance and in default of his entering an appearance the allegations in the plaint shall be deemed to be admitted and the plaintiff shall be entitled to a decree for any sum, not exceeding the sum mentioned in the summons, together with interest at the rate specified, if any, up to the date of the decree and such sum for costs as may be determined by the High Court from time to time by rules made in that behalf and such decree may be executed forthwith.]

8[3. Procedure for the appearance of defendant

    (1) In a suit to which this Order applies, the plaintiff shall, together with the summons under rule 2, serve on the defendant a copy of the plaint and annexures thereto and the defendant may, at any time within ten days of such service, enter an appearance either in person or by pleader and, in either case, he shall file in Court an a address for service of notices on him.

    (2) Unless otherwise ordered, all summonses, notices and other judicial processes, required to be served on the defendant, shall be deemed to have been duly served on him if they are left at the address given by him for such service.

    (3) On the day of entering the appearance, notice of such appearance shall be given by the defendant to the plaintiff's pleader, or, if tile plaintiff sues in person, to the plaintiff himself, either by. notice delivered at or sent by a pre-paid letter directed to the address of the plaintiff's pleader or of the plaintiff, as the case may be.

    (4) if the defendant enters an appearance, the plaintiff shall thereafter serve on the defendant a summons for judgement in Form No. 4A in Appendix B or such other Form as may be prescribed from time to time, returnable not less than ten days from the date of service supported by an affidavit verifying the cause of action and the amount claimed and stating that in his belief there is no defence to the suit.

    (5) The defendant may, at any time within ten days from the service of such summons for judgement, by affidavit or otherwise disclosing such facts as may be deemed sufficient to entitle him to defend, apply on such summons for leave to defend such suit, and leave to defend may be granted to him unconditionally or upon such terms as may appear to the Court or Judge to be just:

    Provided that leave to defend shall not be refused unless the Court is satisfied that the facts disclosed by the defendant do not indicate that he has a substantial defence to raise or that the defence intended to be put up by the defendant is frivolous vexatious:

    Provided further that, where a part of the amount claimed by the plaintiff is admitted by the defendant to be due from him, leave to defend the suit shall not be granted unless the amount so admitted to be due is deposited by the defendant in Court.

    (6) At the hearing of such summons for judgement,-

        (a) if the defendant has not applied for leave to defend, or if such application has been made and is refused, the plaintiff shall be entitled to judgement forthwith; or

        (b) if the defendant is permitted to defend as to the whole or any part of the claim, the Court or Judge may direct him to give such security and within such time as may be fixed by the Court or Judge and that, on failure to give such security within the time specified by the Court or Judge or to carry out such other directions as may have been given by the Court or Judge, the plaintiff shall be entitled to judgement forthwith.

    (7) The Court or Judge may, for sufficient cause shown by the defendant, excuse the delay of the defendant in entering an appearance or in applying for leave to defend the suit.]

4. Power to set aside decree

After decree the Court may, under special circumstances set aside the decree, and if necessary stay or set aside execution, and may give leave to the defendant to appear to the summons and to defend the suit, if it seems reasonable to the Court so to de, and on such terms as the Court thinks fit.

5. Power to order bill, etc., to be deposited with officer of Court

In any proceeding under this Order the Court may order the bill, hundi or note on which the suit is founded to be forthwith deposited with an officer of the Court, and may further order that all proceedings shall be stayed until the plaintiff gives security for the costs thereof.

6 Recovery of cost of noting non-acceptance of dishonoured bill or note

The holder of every dishonoured bill of exchange or promissory note shall have the same remedies for the recovery of the expenses incurred in noting the same for non-acceptance or non-payment, or otherwise, by reason of such dishonour, as he has under this Order for the recovery of the amount of such bill or note."

S J Mathew
Advocate, Mumbai
3619 Answers
175 Consultations

it is correct that in recovery cases limitation is three years,

First send them legal notice under section 80 CPC for making payment as sending legal notice is mandatory, but the same can be exempted stating some reason, like, in your case, limitation,

engage a prominent lawyer to file a summary suit for recovery under Order XXXVII CPC, 

you have to deposit a court fee also to file the case,

 

Suneel Moudgil
Advocate, Panipat
2386 Answers
6 Consultations

You need go give notice under section 80  cpc before filing suit against public officer govt body. Then after 2 months you can proceed with the suit against them

Prashant Nayak
Advocate, Mumbai
34514 Answers
249 Consultations

in recovery of money suits legal notice is a necessary, if you give notice it will be a good defence  legal notice is the first step to start with the cause of action

Mohammed Mujeeb
Advocate, Hyderabad
19325 Answers
32 Consultations

Limitation period would be counted from the last date of formal demand of payment.

 

You would need to wait for 60days after giving legal notice under Section 80 CPC.

 

Siddharth Jain
Advocate, New Delhi
6617 Answers
102 Consultations

Three years from the date on which the MCG received the bill that can be enquired from the daak register and count only 30 days after the date of receiving the notice by the MCG and mention in the notice that after 30 days you are free to take legal action for which the responsibility shall be of the  MCG and its officers dealing with the matter.

Koshal Kumar Vatsa
Advocate, Gurgaon
2282 Answers
3 Consultations

60 days notice is required to be issued under provisions of section 80 of cpc 

 

2) under section 80(2) if court is satisfied that urgent relief is required to be given to plaintiff would not insist that plaintiff has to wait for 2 months after service of notice . you can seek leave of court to file suit without issue of notice 

Ajay Sethi
Advocate, Mumbai
99776 Answers
8145 Consultations

Hello,  

  1. Three year's limitation starts from 16 June 2017.
  2. It depends on what is the duration that you mention in the legal notice. 30 days would be ideal though. 

S J Mathew
Advocate, Mumbai
3619 Answers
175 Consultations

If these are admitted bill and there is no dispute of amount that might arise, you can also approach the HC with a writ of mandamus in this case.

 

regards

Anilesh Tewari
Advocate, New Delhi
18103 Answers
377 Consultations

Sixty days but if your limitation is exceeded then yig can file the case immediately without notice and later can give them notice.  If they have replied to your invoice or communication after the said Bill then 3 years from the said communication other wise after the date of submitting bill. 

Prashant Nayak
Advocate, Mumbai
34514 Answers
249 Consultations

Offer the recipient a reasonable time i.e 30 days or 60 days to settle the matter by negotiating and by performing the desired action.

Mohammed Mujeeb
Advocate, Hyderabad
19325 Answers
32 Consultations

1. it will start from the date, the payment becomes due,

i need to go through the terms and conditions of the agreement in this regards,

2. 60 days

you have enough time for sending legal notice

 

 

Suneel Moudgil
Advocate, Panipat
2386 Answers
6 Consultations

It is mandatory to issue legal notice to the government departments before suing them.

You may issue a formal legal demand notice  and after the expiry of the period of time given to them to comply with the demand made, you may file a suit for recovery as proposed by you.

 

T Kalaiselvan
Advocate, Vellore
89978 Answers
2492 Consultations

The three years period can be computed from the date of the payment that became due to you.

You can wait for 30 days.

 

 

T Kalaiselvan
Advocate, Vellore
89978 Answers
2492 Consultations

Ask a Lawyer

Get legal answers from lawyers in 1 hour. It's quick, easy, and anonymous!
  Ask a lawyer