Madhya Pradesh High Court
M/S A.S. Enterprises Thr. Proprietor ... vs Union Of India on 2 August, 2021
Equivalent citations: AIRONLINE 2021 MP 1365
Author: Gurpal Singh Ahluwalia
Bench: Gurpal Singh Ahluwalia
1 THE HIGH COURT OF MADHYA PRADESH
Writ Petition No.11951/2021
M/s. A.S. Enterprises Vs. Union of India and others
Through Video Conferencing
Gwalior, Dated:2/08/2021
Shri D.P. Singh, Advocate for petitioner.
Shri Prakhar Dhengula, Advocate for respondent no.4.
This petition under Article 226 of the Constitution of India has been filed seeking the following reliefs:-
"i) That, the order impugned dated 26.03.2021 contained in Annexure - P/1 terminating the work contract/Agreement may kindly be quashed so also quash the order dated 26.03.2021 contained in Annexure - P/2 with a further direction to the respondents to settle the bills raised by the petitioner and the same were duly been verified by the authority competent and the same be paid within a time bound period alongwith interest @ 18% per annum, in the interest of justice.
ii) That, the respondents be further directed to release the security amount deposited by the petitioner keeping in view of the work has already been executed by the petitioner and raised the final bills and the same be paid alongwith interest @ 18% per annum within the time bound period, in the interest of justice.
iii) Cost of the petition be awarded or any other order or direction deemed fit in the circumstances of the case be issued in the favour of the petitioner."
2 THE HIGH COURT OF MADHYA PRADESH Writ Petition No.11951/2021 M/s. A.S. Enterprises Vs. Union of India and others It is submitted by the counsel for the petitioner that the petitioner is a proprietorship firm registered under the Shops and Establishment Act. The respondents issued NIT on 17/10/2016 for providing transportation and housekeeping, care taking and catering facilities to the hostel of IRCMTECH for the period of two years. In pursuance of the same, the petitioner participated in the bid process by depositing security amount of Rs.63,210/-. Being the successful bidder, the petitioner entered into an agreement on 24/3/2017 for a period of 24 months, i.e. from 14/2/2017 to 13/2/2019. It is the case of the petitioner that the petitioner thereafter completed its work successfully and the dispute arose when the petitioner raised the final bill. The respondents while settling the same have insisted for performing additional work. It is submitted that thereafter the petitioner had written letters dated 22/11/2018, 24/12/2018, 4/2/2019 and 25/6/2019, but all the bills are not settled and the respondents are sitting tight over the matter. Thereafter, the respondents wrote letters on 8/2/2019, 21/2/2019, 9/10/2019 and 20/12/2019 thereby taking objection over the bills and further sought information with respect to deposit of ESI, PF and GST. Another letter dated 24/1/2020 with regard to 11th final bill was also written inter alia contending that the petitioner is not ready to sign No Claim Certificate. The petitioner has applied under right to information seeking information towards 3 THE HIGH COURT OF MADHYA PRADESH Writ Petition No.11951/2021 M/s. A.S. Enterprises Vs. Union of India and others the settlement of the bills. The petitioner has again written a letter dated 27/11/2020 thereby taking objections towards the act of the respondents in not settling the bills. The respondents have provided the information vide letters dated 22/9/2020, 5/10/2020, 6/10/2020 and 9/10/2020. It is submitted that after the final bill was raised, the respondents prepared the final bill after deducting or recovering the cost of items not supplied as per SOR rates. It is further submitted that the final bill was sent to WAO/RSK/STLI for its payment, but WAO/RSK/STLI insisted for No Claim Certificate from the contractor before passing the final bill and accordingly, the petitioner was called upon to submit his No Claim Certificate at the earliest, so that the same can be sent to WAO/RSK/STLI to clear the final bill.
Thereafter, the respondents by letter dated 4/12/2020 invited the petitioner in the week commencing from 7 th December to 11th December, 2020 to resolve the issues pertaining to the contract.
Thereafter, by order dated 19/1/2021 the petitioner was informed that in the meeting the petitioner has shown its willingness to supply the balance quantities of MS items of schedule B of the referred contract and therefore, the petitioner was once again advised to supply the balance quantity of MS items of schedule B and to submit No Claim Certificate at the earliest. It is submitted that thereafter by order dated 18/2/2021 it was informed that the contract of the petitioner has 4 THE HIGH COURT OF MADHYA PRADESH Writ Petition No.11951/2021 M/s. A.S. Enterprises Vs. Union of India and others already expired on 13/2/2019, however, it has failed to complete the contract as per agreement within DOC. Accordingly, the petitioner was advised to apply for extension of DOC within a period of 7 days from the date of issuance of this letter with a valid reason to complete the supply of balance items as per schedule B. It is submitted that once again similar letters have been issued to the petitioner on 25/2/2021, 16/3/2021 and 24/3/2021. It is submitted that since there is no arbitration clause in the contract and in view of the hostile attitude of the respondents, the petitioner is left with no other option but to approach this Court under Article 226 of the Constitution of India.
Heard learned counsel for the parties.
From the various letters issued by the respondents, which have been cumulatively marked as Annexures P/13, P/14, P/15 and P/16, it is clear that the respondents have not admitted the claim of the petitioner. Whether the objection raised by the respondents are correct or not, is a pure disputed question of fact, which cannot be considered by this Court while exercising power under Article 226 of the Constitution of India. The Supreme Court in the case of Shubhas Jain Vs. Rajeshwari Shivam & Ors. by order dated 20/7/2021 passed in Civil Appeal No.2848/2021 has held that highly disputed questions of facts cannot be decided while exercising power under 5 THE HIGH COURT OF MADHYA PRADESH Writ Petition No.11951/2021 M/s. A.S. Enterprises Vs. Union of India and others Article 226 of the Constitution of India. In the case of Shubhas Jain (supra), it has been held as under:-
"26. It is well settled that the High Court exercising its extraordinary writ jurisdiction under Article 226 of the Constitution of India, does not adjudicate hotly disputed questions of facts. It is not for the High Court to make a comparative assessment of conflicting technical reports and decide which one is acceptable."
Further, it is well established principle of law that a writ petition under Article 226 of the Constitution of India is not maintainable for enforcement of contract.
The Supreme Court in case of Life Insurance Corpn. Of India and Others Vs. Asha Goel (Smt.) and Another, reported in (2001) 2 SCC 160 has held as under :
"10. Article 226 of the Constitution confers extraordinary jurisdiction on the High Court to issue high prerogative writs for enforcement of the fundamental rights or for any other purpose. It is wide and expansive. The Constitution does not place any fetter on exercise of the extraordinary jurisdiction. It is left to the discretion of the High Court. Therefore, it cannot be laid down as a general proposition of law that in no case the High Court can entertain a writ petition under Article 226 of the Constitution to enforce a claim under a life insurance policy. It is neither possible nor proper to enumerate exhaustively the circumstances in which such a claim can or cannot be enforced by filing a writ petition. The
6 THE HIGH COURT OF MADHYA PRADESH Writ Petition No.11951/2021 M/s. A.S. Enterprises Vs. Union of India and others determination of the question depends on consideration of several factors like, whether a writ petitioner is merely attempting to enforce his/her contractual rights or the case raises important questions of law and constitutional issues; the nature of the dispute raised; the nature of inquiry necessary for determination of the dispute etc. The matter is to be considered in the facts and circumstances of each case. While the jurisdiction of the High Court to entertain a writ petition under Article 226 of the Constitution cannot be denied altogether, courts must bear in mind the self-imposed restriction consistently followed by High Courts all these years after the constitutional power came into existence in not entertaining writ petitions filed for enforcement of purely contractual rights and obligations which involve disputed questions of facts. The Courts have consistently taken the view that in a case where for determination of the dispute raised, it is necessary to inquire into facts for determination of which it may become necessary to record oral evidence a proceeding under Article 226 of the Constitution, is not the appropriate forum. The position is also well settled that if the contract entered between the parties provide an alternate forum for resolution of disputes arising from the contract, then the parties should approach the forum agreed by them and the High Court in writ jurisdiction should not permit them to by-pass the agreed forum of dispute resolution. At the cost of repetition it may be stated that in the above discussions we have only indicated some of the 7 THE HIGH COURT OF MADHYA PRADESH Writ Petition No.11951/2021 M/s. A.S. Enterprises Vs. Union of India and others circumstances in which the High Courts have declined to entertain petitions filed under Article 226 of the Constitution for enforcement of contractual rights and obligation; the discussions are not intended to be exhaustive. This Court from time to time disapproved of a High Court entertaining a petition under Article 226 of the Constitution in matters of enforcement of contractual rights and obligation particularly where the claim by one party is contested by the other and adjudication of the dispute requires inquiry into facts. We may notice a few such cases; Mohammed Hanif v. The State of Assam (1969) 2 SCC 782; Banchhanidhi Rath v. The State of Orissa and ors. (1972) 4 SCC 781; Smt. Rukmanibai Gupta v. Collector, Jabalpur (1980) 4 SCC 556; Food Corpn. of India and others v. Jagannath Dutta 1993 Suppl. (3) SCC 635; and State of H.P. vs. Raja Mahendra Pal (1999) 4 SCC 43."
The Supreme Court in the case of Rajasthan State Industrial Development and Investment Corporation and another Vs. Diamond & Gem Development Corporation Ltd. And another reported in (2013) 5 SCC 470 has held as under:
19. There can be no dispute to the settled legal proposition that matters/disputes relating to contract cannot be agitated nor terms of the contract can be enforced through writ jurisdiction under Article 226 of the Constitution. Thus, writ court cannot be a forum to seek any relief based on terms and conditions incorporated in the agreement by the parties. [Vide: Bareilly Development Authority v. Ajai Pal Singh and State
8 THE HIGH COURT OF MADHYA PRADESH Writ Petition No.11951/2021 M/s. A.S. Enterprises Vs. Union of India and others of U.P. v. Bridge & Roof Co. (India) Ltd.]
20. In Kerala SEB v. Kurien E. Ealathil, this Court held that a writ cannot lie to resolve a disputed question of fact, particularly to interpret the disputed terms of a contract observing as under: (SCC pp.298-99, paras 10-11) "10. . ..The interpretation and implementation of a clause in a contract cannot be the subject-matter of a writ petition. ....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.....
11. ...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.... The contractor should have relegated to other remedies."
21. It is evident from the above that generally the court should not exercise its writ jurisdiction to enforce the contractual obligation. The primary purpose of a writ of mandamus is to protect and establish rights and to impose a corresponding imperative duty existing in law. It is designed to promote justice (ex debito justiceiae). The grant or refusal of the writ is at the discretion of the court. The writ cannot be granted unless it is established that there is an existing legal right of the applicant, or an existing duty of the respondent. Thus, the writ does not lie to create or to establish a legal right, but to enforce one that is already established. While dealing with a writ petition, the court must exercise discretion, taking into consideration a wide variety of circumstances, inter-alia, the facts of the case, the exigency that warrants such exercise of discretion, the 9 THE HIGH COURT OF MADHYA PRADESH Writ Petition No.11951/2021 M/s. A.S. Enterprises Vs. Union of India and others consequences of grant or refusal of the writ, and the nature and extent of injury that is likely to ensue by such grant or refusal.
The Supreme Court in the case of Binny Ltd. & Anr. vs. V. Sadasivan & Ors. reported in (2005) 6 SCC 657 has held as under:
10. The writ of mandamus lies to secure the performance of a public or a statutory duty. The prerogative remedy of mandamus has long provided the normal means of enforcing the performance of public duties by public authorities. Originally, the writ of mandamus was merely an administrative order from the Sovereign to subordinates. In England, in early times, it was made generally available through the Court of King's Bench, when the Central Government had little administrative machinery of its own. Early decisions show that there was free use of the writ for the enforcement of public duties of all kinds, for instance against inferior tribunals which refused to exercise their jurisdiction or against municipal corporation which did not duly hold elections, meetings, and so forth. In modern times, the mandamus is used to enforce statutory duties of public authorities. The courts always retained the discretion to withhold the remedy where it would not be in the interest of justice to grant it. It is also to be noticed that the statutory duty imposed on the public authorities may not be of discretionary character. A distinction had always been drawn between the public duties enforceable by mandamus that are statutory and duties arising merely from contract. Contractual duties are enforceable as matters of private law by ordinary contractual remedies such as damages, injunction, specific performance and declaration. In the Administrative Law (Ninth Edn.) by Sir William Wade and Christopher Forsyth, (Oxford University Press) at p.621, the following opinion is expressed:
"A distinction which needs to be clarified is 10 THE HIGH COURT OF MADHYA PRADESH Writ Petition No.11951/2021 M/s. A.S. Enterprises Vs. Union of India and others that between public duties enforceable by mandamus, which are usually statutory, and duties arising merely from contract. Contractual duties are enforceable as matters of private law by the ordinary contractual remedies, such as damages, injunction, specific performance and declaration. They are not enforceable by mandamus, which in the first place is confined to public duties and secondly is not granted where there are other adequate remedies. This difference is brought out by the relief granted in cases of ultra vires. If for example a minister or a licensing authority acts contrary to the principles of natural justice, certiorari and mandamus are standard remedies. But if a trade union disciplinary committee acts in the same way, these remedies are inapplicable: the rights of its members depend upon their contract of membership, and are to be protected by declaration and injunction, which accordingly are the remedies employed in such cases."
According to the petitioner, in absence of any arbitration clause, he has no other alternative remedy. The contention made by the counsel for the petitioner is misconceived and cannot be accepted. If the petitioner is of the view that he cannot approach the arbitrator in absence of arbitration clause, then he has an efficacious remedy of filing a civil suit before the Court of competent jurisdiction, which shall be decided after recording the evidence of the parties. Under these circumstances, as the controversy involves highly disputed questions of facts, which cannot be adjudicated by this Court while exercising power under Article 226 of the Constitution of India and a writ petition is not maintainable for 11 THE HIGH COURT OF MADHYA PRADESH Writ Petition No.11951/2021 M/s. A.S. Enterprises Vs. Union of India and others enforcement of contract, this petition is dismissed in limine with liberty to the petitioner to avail the alternative remedy which is available to him.
(G.S. Ahluwalia) Judge Arun* ARUN KUMAR MISHRA 2021.08.04 17:02:55 +05'30'