Introduction:

In a landmark judgment, the Orissa High Court addressed the maintainability of suits against the State and its agencies in the absence of notice under Section 80 of the Code of Civil Procedure (CPC). The case, State of Orissa & Anr. v. M/s. B. Engineers and Builders Private Limited, revolved around a construction contract dispute wherein the appellants, the State of Orissa and its Executive Engineer, attempted to challenge the suit’s maintainability at the appellate stage. Justice Ananda Chandra Behera upheld the lower courts’ concurrent findings, emphasizing that failure to object to the absence of Section 80 notice in the trial stage amounts to a waiver, and such objections cannot be raised for the first time during the appeal.

Arguments by the Appellants:

The appellants, represented by their standing counsel, contended that the civil suit filed by the respondent construction company was not maintainable due to the absence of a statutory notice under Section 80(1) CPC. They argued that the provision is mandatory and indispensable, serving as a prerequisite for filing suits against the government or its officers. According to the appellants, the respondent’s failure to comply with this procedural requirement rendered the suit fundamentally flawed and inadmissible in law. They further asserted that the provision’s objective is to afford the State a fair opportunity to settle claims without resorting to litigation, an opportunity that was allegedly denied due to the respondent’s non-compliance.

Arguments by the Respondent:

The respondent, a registered construction company, did not appear for the second appeal but had previously succeeded in the trial and first appellate courts. The company maintained that the appellants never raised the issue of Section 80 notice during the trial. The respondent argued that the State’s attempt to introduce this objection at the appellate stage was both procedurally impermissible and a direct violation of established legal principles. Furthermore, the respondent highlighted the appellants’ conduct during the trial, which demonstrated an implied waiver of the notice requirement. By failing to raise the issue in their written statement, the appellants had effectively foregone their right to object on these grounds.

Factual Background:

The dispute arose from a contractual agreement dated January 25, 1985, wherein the respondent company was tasked with constructing a bridge over the Vansadhara River in Rayagada district. Due to unforeseen natural calamities, the project faced delays, and the completion timeline was extended until June 30, 1992. During this period, the respondent incurred substantial expenses, yet the appellants unilaterally cancelled the contract, citing delays and adjusted the company’s security deposit against alleged losses. Aggrieved, the respondent filed a civil suit seeking a declaration that the contract’s cancellation was invalid and a refund of the security deposit.

Both the trial court and the first appellate court ruled in favor of the respondent, holding that the contract’s rescission was unjustified. The appellants, dissatisfied with these rulings, brought the matter to the High Court, raising the maintainability issue based on the absence of a Section 80 notice for the first time in the second appeal.

Court’s Observations:

The High Court framed two substantial questions of law: first, whether the suit was maintainable in the absence of a Section 80 notice, and second, whether the appellants had waived their right to object to the absence of such notice.

Justice Behera extensively analyzed the pleadings, evidence, and judgments from the lower courts. It was undisputed that the respondent company had not served a Section 80 notice before filing the suit. However, the appellants did not raise this objection during the trial or in their written statement. The court noted that no issue was framed regarding this point, nor was any evidence or argument presented challenging the suit’s maintainability based on non-service of notice.

The court emphasized the purpose of Section 80 CPC, which is to provide the State an opportunity to settle disputes amicably and avoid unnecessary litigation. However, it clarified that this procedural safeguard, though mandatory, can be waived if the defendant does not raise timely objections. The court relied on precedents from the Supreme Court and various High Courts, which consistently held that objections to the absence of Section 80 notice cannot be introduced at the appellate stage if not raised during trial.

The High Court concluded that the appellant’s conduct demonstrated an unequivocal waiver of the notice requirement. By failing to object at the trial stage, they forfeited their right to challenge the suit’s maintainability on this ground. The court dismissed the second appeal, affirming the lower courts’ concurrent findings and upholding the decree in favour of the respondent.