Calcutta High Court (Appellete Side)
M/S.Acc Limited & Ors vs Damodar Valley Corporation & Ors on 6 February, 2012
Author: Jayanta Kumar Biswas
Bench: Jayanta Kumar Biswas
1 In The High Court At Calcutta Constitutional Writ Jurisdiction Appellate Side Present:
The Hon'ble Mr.Justice Jayanta Kumar Biswas W.P.No.21546(W) of 2011 M/s.ACC Limited & Ors.
v.
Damodar Valley Corporation & Ors.
Mr.Omprakash Dubey
Mr.Rajesh Upadhyay
Ms. S. Mukherjee ...for the petitioners
Mr.Prasun Mukherjee. ...for DVC
Heard on: February 6, 2012.
Judgement on: February 6, 2012.
The Court:- The petitioners in this WP under art.226 dated December 14, 2011 are questioning a notice dated May 26, 2011 ( at p.26) issued by Damodar Valley Corporation (in short DVC) "under Clause-14 of the bi-lateral agreement and u/s 22 of DVC Act for Industrial and/Domestic Water Supply."
DVC entered into an agreement dated May 19, 1989 (at p.22) with one M/s. Damodar Cement and Slag Ltd. Under the agreement DVC permitted M/s. Damodar Cement and Slag to draw six million gallons of water per month from the river Damodar with effect from July 1, 1986 for a period of forty years. It was provided that six million gallons of water per month would be available for M/s.Damodar Cement and Slag.
Clause 14 of the agreement provided that M/s. Damodar Cement and Slag would conform to and abide by all rules and regulations made by DVC consistent with the agreement relating to the extraction of water from DVC's sources. Clause 15 of the Agreement provided that in the event of any dispute or difference arising at any time between DVC and M/s. Damodar Cement and Slag in regard to any matter arising out of 2 or in connection with the agreement such dispute or difference would be referred to the arbitration of two arbitrators.
In the notice DVC stated that though M/s. Damodar Cement and Slag was allocated 0.2 MGD water, it was actually consuming (based on peak utilization for last four years) only 0.093 MGD. Recording this fact DVC gave notice that in public interest it was necessary to terminate the agreement. Saying so it gave notice notifying that upon expiration of six months the agreement would stand terminated, and giving M/s. Damodar Cement and Slag liberty to enter into a fresh agreement for 0.093 MGD raw water.
The agreement was not a statutory agreement. According to Mr.Dubey appearing for the petitioners, the notice was issued without jurisdiction, for nothing in s.22 of the DVC Act, 1948 empowers DVC to terminate the agreement. His submission is that on the facts it was not necessary for the petitioners to go to arbitration or to the Civil Court.
The notice was issued as back as May 26, 2011 and the six-month period mentioned therein expired on November 26, 2011. This WP is dated December 14, 2011. It is, therefore, evident that at the date this WP was brought, the agreement had already stood terminated. In my opinion, the question whether the termination is valid ought to have been raised either before the arbitral tribunal in terms of the arbitration agreement between the parties or before the Civil Court.
The petitioners choosing not to question the termination notice during the six- month notice period, and approaching the Writ Court only after expiration of the period, and when the agreement had already stood terminated, are not entitled to any relief from the Writ Court, essentially a Court of equity.
Citing public interest DVC proposed to terminate the agreement and gave a six- month notice, the petitioners instead of promptly questioning the notice allowed the notice period to expire and the agreement to stand terminated. It is not their case that the 3 allegation that they did not draw more than 0.093 MGD raw water during the last four years is incorrect. I am, therefore, of the view that it is not a fit case for interfering in exercise of extraordinary powers under art.226.
For these reasons, I dismiss the WP making it clear that nothing herein shall prevent the petitioners from approaching the arbitral tribunal or the Civil Court, as the case may be. No costs. Certified xerox.
(Jayanta Kumar Biswas, J) sm(c);ab(f).