Calcutta High Court (Appellete Side)
Shyam Metallics & Energy Limited & Anr vs Union Of India & Ors on 26 April, 2011
Author: Jayanta Kumar Biswas
Bench: Jayanta Kumar Biswas
26.04.11 In The High Court At Calcutta
ss Constitutional Writ Jurisdiction
Appellate Side
W.P. No. 6197 (W) of 2011
Shyam Metallics & Energy Limited & Anr.
v.
Union of India & Ors.
Mr Anindya Mitra
Mr Saktinath Mukherjee
Mr S. Pal
Mr Saptanshu Basu
Mr Abhrajit Mitra
Mr Jishnu Chowdhury
Mr Debanjan Mondal
Mr Dwip Raj Basu
Ms Swati Agarwal ...for the petitioners.
Mr Rajiv Lall ...for the Union of India.
Mr Aniruddha Mitra
Mr Partha Basu
Mr Nikhil Kumar Roy ...for the Mahanadi Coalfields Ltd.
In terms of orders notices have been served on the respondents. Coal India
Limited has chosen not to enter appearance at this stage. The Union of India and Mahanadi Coalfields Limited have entered appearance.
Mr Mitra appearing for the petitioners has submitted that the petitioners praying for continuation of the interim order dated April 5, 2011 need a further interim order directing Mahanadi Coalfields Limited to supply coal according to terms and conditions of the existing agreement and not to reduce the quantity or to charge above the notified rates. He has said that the allotted virgin coal block that was to be used for supplying coal for operating steel plant set up in 2006 with a captive power plant has not yet been made ready for use. His submission is that until coal is supplied from the coal block Mahanadi is under an obligation to supply coal according to terms and conditions of the existing agreement.
Mr Lall appearing for the Union of India has submitted that it is incorrect to say that any coal block was allotted to the joint venture. He has clarified by saying that the joint venture approved by the appropriate authority subsequently took charge of the allotted coal block, and that coal extracted from the block is to be supplied for operating the steel plant set up by the petitioners in 2006. Mr Mitra appearing for Mahanadi Coalfields Limited has submitted as follows. This Court has no jurisdiction to entertain the petition against Mahanadi Coalfields that has its seat outside the territories in relation to which this Court exercises jurisdiction under art.226. It is evident from the prayer that the petitioners are seeking specific performance of contract. From the terms and conditions of the agreement at p.302 it is evident that the Court of Sambalpur shall have exclusive jurisdiction in all matters under the agreement. Supply quantity has been reduced by Mahanadi in compliance with the directions of the Ministry of Coal at p.395.
After hearing counsel for the parties and considering the case revealed by the petition, I am of the view that this Court has jurisdiction to entertain the petition. Mahanadi Coalfields Limited is not the only respondent and the petitioners are seeking relief also against Coal India Limited. Mahanadi Coalfields Limited is a subsidiary of Coal India Limited.
I am also of the view that it will be appropriate to admit the petition, continue the existing interim order and make further interim order regarding quantity of supply and price. It is not disputed that under the existing agreement Mahanadi is under an obligation to supply coal of specified quantity. It seems to me that there is substantial force in the argument that a reduced supply is bound to affect the functioning of the steel plant that was set up in anticipation of supply of coal from the allotted block. The block is to be made operational by the joint venture in which Mahanadi is the lead partner. Hence I am of the view that until coal is supplied from the allotted block according to terms and conditions concerned Mahanadi should continue to supply the quantity according to terms and conditions of the agreement. As to the price, I am of the view that it will not be appropriate to make any restraining order; if ultimately it is found that the petitioners have been made to pay in excess of their lawful liability, it will be possible to examine the question of refund.
For these reasons, I admit the petition and order as follows. The interim order existing today shall remain in force till the disposal of the petition. Till the disposal of the petition Mahanadi Coalfields Limited shall continue to supply the petitioners coal according to terms and conditions of the existing agreement and it shall not reduce the quantity. If the petitioners are made to pay at any rate other than the notified rate, then such payment will be without prejudice to their rights and contentions.
The respondents shall file opposition within five weeks, reply, if any, shall be filed by a week thereafter.
This order shall be communicated to the non-appearing respondents within a week and affidavit of service showing compliance shall be filed at the time of final hearing. Liberty to mention the matter for final hearing. Certified xerox.
(Jayanta Kumar Biswas, J.)