M/S Supreme Laundry Services Joint ... vs The Union Of India And 5 Others on 5 June, 2023

[Cites 10, Cited by 1]

Telangana High Court

M/S Supreme Laundry Services Joint ... vs The Union Of India And 5 Others on 5 June, 2023

Bench: K.Lakshman

           THE HON'BLE SRI JUSTICE K. LAXMAN

               WRIT PETITION No.4906 OF 2021

ORDER:

The present writ petition is filed seeking a declaration that the action of the Respondents in not paying the Petitioners the price agreed as per Clause 5.2.II of the Contract Agreement No. M.13/C&W/Mech Laundry/215/BOOT/KCG (hereinafter referred to as 'contract') dated 24.09.2014 and invoking force majure clause is illegal, arbitrary, unjust and without jurisdiction. Further, the Petitioners also seek to set aside the letters dated 01.04.2020 and 02.04.2020 issued by Respondent Nos. 5 and 4 respectively along with letter dated 14.09.2020 issued by Respondent No. 6 invoking the force majure clause.

2. Heard Mr. C.V. Mohan Reddy, learned senior counsel, representing Mr. M. Karthik Pavan Kumar, learned counsel for the Petitioner, Sri T.Suryakaran Reddy, learned Additional Solicitor General of India, representing Sri Krishna Kumar Kovvuri, learned standing counsel for Central Government appearing for Respondents.

(For the sake of convenience, both the Petitioners will be collectively addressed as 'the Petitioner').

Facts of the case:-

3. The Petitioner No. 1 is a company and is being represented by Petitioner No. 2 who is its Chief Executive Officer. After floating a tender, the Petitioner was awarded a tender by the Indian Railways vide contract dated 24.09.2014. The said contract was a BOOT laundry contract. As per the said contract, the Petitioner was required to set up and operate a mechanized laundry at Kacheguda. The work under the contract also required the Petitioner to collect soiled linen from trains at nominated locations, wash them and re-load them back to the nominated train coaches. The period of agreement was 15 years and the contract value was Rs. 83,96,46,000/-. Under the contract dated 24.09.2014, Clause 5.2.I of the Special Conditions of Contract (hereinafter referred to as 'SCC') provided that the Petitioner will be paid for an average of 12 tons of soiled linen which may include an increased variation of 15 tons. Clause 5.2.II of the SCC provided that the Railways will assure a supply of 9 tons of soiled linen per day for which the Petitioner will be paid. Clause 5.2 is extracted below:

"5.2. Quantity Variation:-

1. The agreed unit rate payable to the Tenderer/contractor is for the quantity upto average 12 Tons Linen per day (average reckoned over a period of one mo with variation Joy) 25%, i.e. the rate is applicable up to 15 Tons per day 3 II. If the quantity varies downwards, the amount payable to the contractor shall be based on actual work done at the agreed unit rate. However, Railway shall provide an assured offtake of 9 Tons of linen per day (averaged over a month) which is 75% of 12 Tons per day. No other compensation whatsoever is payable to the Tenderer/contractor.

III. If the quantity exceeds + 25% of the per diem quantity, viz average 15 Tons per day, the folliwng shall be applicable:-

a. Minus(-) 2% (two percent) of the unit rate for the quantity exceeding average The following shall be applicable 15 Tons per day up to 16.80 Tons per day and;

b. Minus (-) 4% (Four percent) of the unit rate for the quantity exceeding average 16.80 Tons per day upto 18 Tons per day.

c. Average daily variation for the above purpose shall be calculated on month basis i.e. the average quantity per day in a month shall be arrived at by dividing the total quantity for the month by the total working days of the laundry in the month.

IV. If overall quantity for 15 years period exceeds + 50% of the agreement quantity, the rate Applicable fro excess quantity over + 50% of the agreement shall be fixed through negotiation process between the Contractor and the Railway."

4. The contract was in vogue and the parties performed their respective obligations until February, 2020 when the country went into lockdown due to the Covid-19 pandemic. Due to the lockdown, the transport services of railways were affected.

5. During the pandemic, Respondent No. 5 (Senior Coaching Depot Officer) issued a letter dated 01.04.2020 to the Petitioner invoking the force majure clause on the ground that Covid-19 has been considered a natural calamity by the Government of India. The 4 said letter also stated that the assured off take of 9 tons of soiled linen cannot be provided from 26.03.2020. The Petitioner replied to the letter dated 01.04.2020 on 02.04.2020 stating that Respondent No. 5 could not have invoked the force majure clause as he did not enter into any agreement with the Petitioner. Further, it stated that the letter dated 01.04.2020 did not refer to any relevant force majure clause.

6. In continuance of the letter dated 01.04.2020, Respondent No. 5 forwarded another letter dated 02.04.2020 to the Petitioner. The said letter dated 02.04.2020 was issued by Respondent No. 4 (Chief Rolling Stock Engineer) relying on the Office Memorandum (hereinafter referred to as 'O.M.') dated 19.02.2020 issued by the Government of India. The letter dated 02.04.2020 stated that Covid-19 is natural calamity and force majure clause can be invoked in BOOT laundry contracts as due to suspension of train services, the assured questioning of 9 tons of soiled linen cannot be supplied.

7. It is relevant to note that the force majure clause invoked by the Respondents in the present case forms part of the General Conditions of Contract (hereinafter referred to as 'GCC') and is incorporated in Clause 17 which is extracted below: 5

17. Force Majeure Clause: If at any time, during the continuance of this contract, the performance in whole or in part by either party of any obligation under this contract shall be prevented or delayed by reason of any war, hostility, acts of public enemy, civil commotion, sabotage, serious loss or damage by fire, explosions, epidemics, strikes, lockouts or acts of God (hereinafter, referred to events) provided, notice of the happening of any such event is given by either party to the other within 30 days from the date of occurrence thereof, neither party shall by reason of such event, be entitled to terminate this contract nor shall either party have any claim for damages against the other in respect of such non-performance or delay in performance, and works under the contract shall be resumed as soon as practicable after such event has come to an end or ceased to exist, and the decision of the Engineer as to whether the works have been so resumed or not shall be final and conclusive, PROVIDED FURTHER that if the performance in whole or in part of any obligation under this contract is prevented or delayed by reason of any such event for a period exceeding 120 days, either party may at its option terminate the contract by giving notice to the other party.

Thereafter, the Petitioner addressed another letter dated 06.04.2020 to Respondent Nos. 5 and 6 stating force majure was not invoked in relation to other contracts involving payments to contractual, casual and outsourced staff. Therefore, invocation of force majure in BOOT laundry contracts is discriminatory. In the said letter dated 06.04.2020, the Petitioner also stated that the O.M. dated 19.02.2020 is only applicable to procurement contracts and not to BOOT laundry 6 contracts. The Petitioner requested the Respondents to meet the assured supply of soiled linen.

8. While things stood thus, Respondent No. 5 addressed a letter dated 11.05.2020 to the Petitioner stating that BOOT laundry operations have been stopped from 22.03.2020 due to Covid-19. The Petitioner was asked to submit the bill upto 21.03.2020 for payment. Further, the said letter also stated that the Petitioner is not entitled for any compensation under Clause 3.24.8 (b) of the SCC for loss suffered due to cancellation of trains. Clause 3.24.8 of the SCC is extracted below:

3.24.8: The contractor shall not have any claim for compensation against railway in case of:-

a. Reduction in the no. of bed rolls for washing and distribution due to reasons such as extension of trains, change of primary depot, change of rake link etc. b. Cancellation of trains due to any reasons whatsoever and the consequent loss suffered by him.

c. For any damage, loss etc., which the contractor or his employee may sustain on account of fire or other causes.

9. In the meanwhile, the Government of India on 13.05.2020 issued another O.M. dated 13.05.2020 stating that after following due procedure, force majure clauses can be invoked in all Public-Private Partnership (PPP) Contracts on account of Covid-19. 7

10. On 03.07.2020, the Government of India issued a letter clarifying various issues relating to payments in BOOT laundry contracts due to Covid-19. The said letter stated that each contract has to be treated based on its own terms including the GCC. Further, assured off-take quantity of linen can be supplied on a short to medium run and such quantity can be renegotiated. However, the letter stated wherever necessary and applicable, force majure clauses can be invoked. Based on the letter dated 03.07.2020, the Petitioner submitted a request-cum-representation dated 06.07.2020 to the Respondents to clear the bills from 22.03.2020 to 30.06.2020 as per Clause 5.2.II of the SCC. Thereafter, another letter dated 04.08.2020 was addressed by the Petitioner to clear the bill from 21.03.2020 to 31.07.2020. On 14.09.2020, the Petitioner's representation dated 06.07.2020 for clearance of bill from 22.03.2020 to 30.06.2020 as per Clause 5.2.II of the SCC was rejected by Respondent No. 6 on the ground of invocation of force majure clause.

11. According to the Petitioner, due to non-clearance of bills, its financial condition is deteriorating and it has received various notices threatening initiation of recovery proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security 8 Interest Act, 2002. Therefore, the Petitioner has filed the present writ petition on the ground that invocation of force majure clause to deny payments is, inter alia, illegal, arbitrary and discriminatory.

12. It was brought to the notice of this Court that other railway zones like East Coast Railways have been clearing the bills and have not invoked any force majure clauses. Further, an unstarred question in the parliament relating to the payments in BOOT laundry contracts and its answer by the Minister of Railways was placed on record. The answer dated 15.12.2021 stated that each existing contract has to be dealt with in accordance with its own merits and the GCC.

13. During the pendency of the present writ petition, the Respondents addressed a letter dated 17.10.2022 to the Petitioner stating that invocation of force majure clause was revoked with effect from 14.03.2022. In the said letter, it was stated that all the BOOT laundry contractors like the Petitioner were advised to resume the laundry operations. However, as various letters were issued to resume laundry operations and the Petitioner failed to reply, the letter dated 17.10.2022 was issued as a final notice. The Petitioner stated before this Court that it cannot resume the laundry operations on account of 9 its bad financial situation owing to the non-payment by the Respondents.

14. Contentions of the Petitioners i. Force majure clause could not have been issued by Respondent No. 5 vide letter dated 01.04.2020 as he is not a party to the contract dated 24.09.2014.

ii. Clause 5.2.II providing for supply of 09 tons of assured off-

take supply of linen forms part of the SCC and Clause 17 of the GCC provides for invocation of force majure. Relying on Clauses 2.1, 2.8, 3.1 and 3.24.1 of the contract dated 29.04.2014 it was contended that the SCC prevails over the GCC in case of a conflict. Therefore, Clause 5.2.II will prevail over Clause 17 and force majure could not have been invoked. The relevant clauses are extracted below:

"Clause 2.1 These Regulations for Tenders and Contracts shall be read in conjunction with the General Conditions of Contract which are referred to herein and shall be subject to modifications, additions or super session by special conditions of contract and/or special specifications, as annexed to the Tender form. In case of a variation/conflict in clauses governing the contract, between the Special Conditions of Contract and the GCC, the former shall prevail Clause 2.8 Conditions of Contract: In addition to the Special Terms and Conditions of Contract, specifications of work and other conditions as laid down in this tender document, the above work will be subject to the General Conditions of the Contract issued by the 10 Engineering department up to latest correction slip in force on South Central Railway."

"3.1 : These Special Conditions of Contract (SCC) (along with Specifications of work and other conditions as contained in this tender document) shall be read together with the terms and conditions incorporated in this Tender Document and the General Conditions of Contract issued by Engineering Department (GCC) of Railways. Should there be any conflict between the provisions of the SCC (along with Specifications of work and other conditions as contained in this tender document) hereof and that of the GCC, the import of the former shall prevail over the latter."

"3.24.9 In case of any contradiction between Special Terms and Conditions of tender and General Conditions, then the Special Terms and Condition shall prevail."

iii. Clause 3.24.8 of the SCC which provides that no compensation is payable due to cancellation of trains cannot supersede Clause 5.2.II of the SCC. Clause 3.24.8 provides that no compensation can be paid apart from the assured price under Clause 5.2.II iv. The invocation of force majure clause is arbitrary and discriminatory as the Respondents did not invoke such clauses in relation to other agreements involving payment to permanent and temporary staff. Further, invocation of such clause is discriminatory as other railway zones like East Coast Railways have not invoked force majure and supplied the assured off-take quantity of linen.

v. Respondent No.1 time and again directed the Respondents to provide assured off-take quantities of linen. However, the same was never done.

vi. Further, the Petitioner's representation dated 06.07.2020 was rejected by Respondent No. 6 who has no authority as he is not a contracting party to the contract dated 29.04.2014. vii. The Petitioner has invested huge amounts in running the laundry operations and the non-payment of bills by the Petitioner has resulted in huge financial loss. viii. In a similar case, arbitration proceedings were initiated against the railways by another BOOT laundry contractor and award was passed granting compensation.

ix. Though an arbitration clause exists in the agreement dated 29.04.2014, this Court has jurisdiction as the said clause in neither effective nor expeditious. The Petitioner is on the verge of a financial collapse. Further, the present writ petition is maintainable as the contractual claim involved stems from the arbitrary action of the Respondents. Reliance was placed on ABL International v. Export Credit 12 Gurantee Corporation 1, Union of India v. Tantia Construction Private Limited 2and Unitech Limited v. Telangana State Industrial Infrastructure Corporation (TSIIC) 3.

15. Contentions of the Respondents i. Preliminary objection was raised regarding the maintainability of the writ petition on the ground that the dispute is contractual in nature and the contract contains an arbitration clause. Therefore, the writ petition is not maintainable. Reliance was placed on Kisan SahkariChini Mills Ltd. v. Vardan Linkers 4 and Nagarjuna Construction Co. Ltd. v. Andhra Pradesh Industrial Infrastructure Corporation Ltd. 5 ii. Force majure clause was invoked based on the instructions received from the Ministry of Railway, Government of India which stated that wherever necessary such clauses can be invoked considering the terms of the contract.

1 (2004) 3 SCC 553.

(2011) 5 SCC 697.

2021 SCC OnLine SC 99.

(2008) 12 SCC 500.

2012 SCC OnLine AP 153.

iii. Assured off-take of linen under Clause 5.2.II of the SCC could not have been provided as the trains were cancelled owing to Covid-19 pandemic.

iv. Respondent No. 5 invoked the force majure clause on behalf of the Railways which is the contracting party. As per Clause 2.2 (a) of the contract dated 29.04.2014, Railways include the President of India or administrative officers of South- Central Railway. Therefore, Respondent No. 5 issued the impugned letter dated 01.04.2020 in his administrative capacity and representative of the Railways.

v. Petitioner cannot rely on the contracts of other railway zones. As instructed by the Ministry of Railways, each contract shall be dealt with in accordance with its own terms and the GCC.

vi. Petitioner is indirectly trying to seek compensation under Clause 5.2.II which is impermissible under Clause 3.24.8. vii. Petitioner cannot contend that force majure clause is being selectively invoked in only a few contracts as Railways has invoked such clauses in other contracts. The said contracts are placed on record for the perusal of this Court. 14 Findings of the Court:-

16. From the facts and contentions raised by the parties, the questions before this Court are whether the present writ petition is maintainable in view of availability of an alternate remedy in the form of an arbitration clause and whether the action of the Respondents warrants interference of this Court under Article 226 of the Constitution of India.

17. It is relevant to note that a writ petition is not maintainable when an alternative remedy exists. However, in exceptional circumstances a writ petition can be maintained, despite availability of an alternative remedy. In Assistant Commissioner of State Tax v.

Commercial Steel Limited 6, a full bench of the Supreme Court held that a writ petition, in presence of an alternative remedy, is maintainable only in exceptional cases. The relevant paragraph is extracted below:

11. The respondent had a statutory remedy under section 107. Instead of availing of the remedy, the respondent instituted a petition under Article 226. The existence of an alternate remedy is not an absolute bar to the maintainability of a writ petition under Article 226 of the Constitution. But a writ petition can be entertained in exceptional circumstances where there is:

2021 SCC OnLine SC 884.

(i) a breach of fundamental rights;

(ii) a violation of the principles of natural justice;

(iii) an excess of jurisdiction; or

(iv) a challenge to the vires of the statute or delegated legislation.

Therefore, only in cases where there is a breach of fundamental rights or violation of principles of natural justice or excess of jurisdiction or challenge to the vires of a law, a writ petition is maintainable.

18. In the present case, an alternative remedy in the form of an arbitration clause is available in Clause 6 of the SCC. However, according to the Petitioner, arbitration is not an effective remedy.

19. It is pertinent to note that arbitration as a mode of dispute resolution is incorporated for speedy resolution of disputes arising out of any contract. When a dispute resolution mechanism like arbitration exists in a contract which statutorily contemplates timely resolution of disputes, it is only in extremely rare cases that a writ petition can be entertained. Further, the rarity of interference under Article 226 of the Constitution of India, cannot be stressed enough when the Supreme Court has time and again held that High Courts shall refrain from entertaining contractual disputes.

20. It is relevant to note that the Supreme Court in State of U.P. v. Bridge & Roof Co. (India) Ltd. 7held that the courts shall not entertain a writ petition when arbitration is available as dispute resolution mechanism. Further, the Court noted that any dispute involving interpretation of terms of contract cannot be entertained under Article 226. The relevant paragraphs are extracted below:

16. Firstly, the contract between the parties is a contract in the realm of private law. It is not a statutory contract. It is governed by the provisions of the Contract Act or, maybe, also by certain provisions of the Sale of Goods Act. Any dispute relating to interpretation of the terms and conditions of such a contract cannot be agitated, and could not have been agitated, in a writ petition. That is a matter either for arbitration as provided by the contract or for the civil court, as the case may be. Whether any amount is due to the respondent from the appellant-Government under the contract and, if so, how much and the further question whether retention or refusal to pay any amount by the Government is justified, or not, are all matters which cannot be agitated in or adjudicated upon in a writ petition. The prayer in the writ petition, viz., to restrain the Government from deducting a particular amount from the writ petitioner's bill(s) was not a prayer which could be granted by the High Court under Article 226. Indeed, the High Court has not granted the said prayer.

***

21. There is yet another substantial reason for not entertaining the writ petition. The contract in question contains a clause providing 7 (1996) 6 SCC 22.

inter alia for settlement of disputes by reference to arbitration (clause 67 of the contract). The arbitrators can decide both questions of fact as well as questions of law. When the contract itself provides for a mode of settlement of disputes arising from the contract, there is no reason why the parties should not follow and adopt that remedy and invoke the extraordinary jurisdiction of the High Court under Article 226. The existence of an effective alternative remedy -- in this case, provided in the contract itself

-- is a good ground for the court to decline to exercise its extraordinary jurisdiction under Article 226. The said article was not meant to supplant the existing remedies at law but only to supplement them in certain well-recognised situations. As pointed out above, the prayer for issuance of a writ of mandamus was wholly misconceived in this case since the respondent was not seeking to enforce any statutory right of theirs nor was it seeking to enforce any statutory obligation cast upon the appellants. Indeed, the very resort to Article 226 -- whether for issuance of mandamus or any other writ, order or direction -- was misconceived for the reasons mentioned supra.

Likewise, in ABL International (supra), the Supreme Court has held that the courts shall not normally interfere when arbitration is chosen as a mode of dispute resolution. The relevant paragraph is extracted below:

14. This judgment again, in our opinion, does not help the first respondent in the argument advanced on its behalf that in contractual matters remedy under Article 226 of the Constitution does not lie. It is seen from the above extract that in that case because of an arbitration clause in the contract, the Court refused to invoke the remedy under 18 Article 226 of the Constitution. We have specifically inquired from the parties to the present appeal before us and we have been told that there is no such arbitration clause in the contract in question. It is well known that if the parties to a dispute had agreed to settle their dispute by arbitration and if there is an agreement in that regard, the courts will not permit recourse to any other remedy without invoking the remedy by way of arbitration, unless of course both the parties to the dispute agree on another mode of dispute resolution. Since that is not the case in the instant appeal, the observations of this Court in the said case of Bridge & Roof Co. [(1996) 6 SCC 22] are of no assistance to the first respondent in its contention that in contractual matters, writ petition is not maintainable.

It is true that in other decisions like Tantia Construction Private Limited (supra), the Supreme Court has held that existence of an arbitration clause is not an absolute bar to the maintainability of a writ petition. However, as can be seen in the following paragraph, the courts can interfere only in cases of injustice committed by the State or its instrumentality. The relevant paragraph is extracted below:

33. Apart from the above, even on the question of maintainability of the writ petition on account of the arbitration clause included in the agreement between the parties, it is now well established that an alternative remedy is not an absolute bar to the invocation of the writ jurisdiction of the High Court or the Supreme Court and that without exhausting such alternative remedy, a writ petition would not be maintainable. The various decisions cited by Mr Chakraborty would clearly indicate that the constitutional powers vested in the High Court or the Supreme Court cannot be fettered by any alternative remedy available to the authorities. Injustice, whenever 19 and wherever it takes place, has to be struck down as an anathema to the rule of law and the provisions of the Constitution.

21. At this stage, it is also relevant to note that the courts shall not entertain a writ petition if it involves interpretation of contractual terms. The Supreme Court in Kerala SEB v. Kurien E. Kalathil 8 held as follows:

10. We find that there is a merit in the first contention of Mr Raval.

Learned counsel has rightly questioned the maintainability of the writ petition. The interpretation and implementation of a clause in a contract cannot be the subject-matter of a writ petition. Whether the contract envisages actual payment or not is a question of construction of contract. If a term of a contract is violated, ordinarily the remedy is not the writ petition under Article 226. We are also unable to agree with the observations of the High Court that the contractor was seeking enforcement of a statutory contract. A contract would not become statutory simply because it is for construction of a public utility and it has been awarded by a statutory body. We are also unable to agree with the observation of the High Court that since the obligations imposed by the contract on the contracting parties come within the purview of the Contract Act, that would not make the contract statutory. Clearly, the High Court fell into an error in coming to the conclusion that the contract in question was statutory in nature.

11. A statute may expressly or impliedly confer power on a statutory body to enter into contracts in order to enable it to discharge its functions. Dispute arising out of the terms of such contracts or alleged breaches have to be settled by the ordinary 8 (2000) 6 SCC 293.

principles of law of contract. The fact that one of the parties to the agreement is a statutory or public body will not by itself affect the principles to be applied. The disputes about the meaning of a covenant in a contract or its enforceability have to be determined according to the usual principles of the Contract Act. Every act of a statutory body need not necessarily involve an exercise of statutory power. Statutory bodies, like private parties, have power to contract or deal with property. Such activities may not raise any issue of public law. In the present case, it has not been shown how the contract is statutory. The contract between the parties is in the realm of private law. It is not a statutory contract. The disputes relating to interpretation of the terms and conditions of such a contract could not have been agitated in a petition under Article 226 of the Constitution of India. That is a matter for adjudication by a civil court or in arbitration if provided for in the contract. Whether any amount is due and if so, how much and refusal of the appellant to pay it is justified or not, are not the matters which could have been agitated and decided in a writ petition. The contractor should have relegated to other remedies. Therefore, it emerges from a long line of precedents that existence of an arbitration clause is not a bar in exercising writ jurisdiction. However, such jurisdiction can be exercised when the actions of the State are marred by prima facie arbitrariness resulting in palpable injustice. Further, the party seeking to invoke writ jurisdiction shall establish that the contract involves a public law element. If the case involves seriously disputed question of facts requiring examination of 21 evidence, the courts shall not interfere. Likewise, if the dispute involves interpretation of terms of the contract, the courts shall refrain from interfering and entertaining a writ petition.

22. In this context, it is relevant to note that the Supreme Court inNational High Speed Rail Corpn. Ltd. v. Montecarlo Ltd. 9 laid down a two-prong test to determine whether a court can interfere in a contract matter. The Court held that unless the decision of the State was discriminatory, arbitrary and irrational that no person could have reached such a decision, the courts shall not interfere. Further, the courts can interfere if the public interest is affected. The relevant paragraph is extracted below:

29. Thus, from the aforesaid decisions, it can be seen that a court before interfering in a contract matter in exercise of powers of judicial review should pose to itself the following questions:

(i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone; or whether the process adopted or decision made is so arbitrary and irrational that the court can say:"the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached"? And

(ii) Whether the public interest is affected?

If the answers to the above questions are in the negative, then there should be no interference under Article 226. 9 (2022) 6 SCC 401.

23. Now coming to the facts of the case, all the contentions raised by the Petitioner involve interpretation of the contract dated 24.09.2014. The question whether invocation of force majure clause was justified is dependent on the question whether there is a conflict between Clause 5.2.II of the SCC and Clause 17 of the GCC and whether the SCC overrides the GCC.

24. Similarly, the question whether the Petitioner is entitled to any compensation is dependent on the interpretation Clause 5.2.II and Clause 3.24.8 of the SCC. Further, the answer to the said question is dependent whether payment of assured off-take quantity of linen is an exception to non-payment of compensation.

25. The Petitioner has also contended that force majure clause could not have been invoked by Respondent No. 5. However, the Respondents contended that he was the authorized officer and the definition of Railways includes its administrative officers of South- Central Railway. Therefore, whether force majure was rightly invoked is dependent on the construction of terms of the contract.

26. According to this Court, the contentions raised by the Petitioners involve serious interpretation of contractual terms. The 23 said interpretation is impermissible under Article 226 of the Constitution of India, more so when an alternative remedy in the form of arbitration is available. Further, this Court did not find the action of the Respondents in invoking the force majure clause so arbitrary and unreasonable which no reasonable person could have reached. There is also no public law element involved in the present writ petition as it only concerns the alleged losses caused to the Petitioner by invocation of the force majure clause.

27. Therefore, in light of the aforesaid discussion, the present writ petition is liable to be dismissed and is accordingly dismissed. However, the Petitioner is at liberty to initiate appropriate proceedings to recover the amount it claims to be entitled to.

Consequently, miscellaneous petitions, if any, shall stand closed.

__________________ K. LAKSHMAN, J Date: 05-06-2023 vvr

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