Gujarat High Court
Institute Of Clinical Research India vs Indus University on 18 October, 2019
Author: Biren Vaishnav
Bench: Biren Vaishnav
C/SCA/14529/2019 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 14529 of 2019
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INSTITUTE OF CLINICAL RESEARCH INDIA
Versus
INDUS University
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Appearance:
MR YATIN OZA, SR. COUNSEL with MR NISARG N TRIVEDI(6144) for the
Petitioner(s) No. 1
MR ANSHIN DESAI, SR. COUNSEL with MR.PARTH CONTRACTOR(7150)
for the Respondent(s) No. 1
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CORAM: HONOURABLE MR.JUSTICE BIREN VAISHNAV
Date : 18/10/2019
ORAL ORDER
1. In this petition, under article 226 of the Constitution of India, the prayers of the petitioner read as under:
"15(A) YOUR LORDSHIPS may be pleased to admit and allow this petition; (B) YOUR LORDSHIPS be pleased to issue a writ of Certiorari to quash and set aside the impugned notice dated 30.07.2019 sent by the Respondent University and declare the impugned notice dated 30.07.2019 illegal, arbitrary and violation of Article 14, 19(1)((g) of the Constitution of India;
2. Reading of the prayers indicate that the petitioner has approached this Court challenging the notice Page 1 of 11 Downloaded on : Sun Oct 20 02:14:54 IST 2019 C/SCA/14529/2019 ORDER dated 30.7.2019 issued by the respondent University. Reading of the notice also indicates that it is with regard to the termination of the memorandum of understanding entered into by and between the parties on 6.4.2018.
3. According to the petitioner, it was appointed on 6.4.2018 for conducting the admission and placement process of the students and the revenues generated from the students fees were shared between the petitioner and the respondent University in the ratio of 65:35.
4. The grievances have been raised in the petition, particularly in para Nos.7, 8 & 9 with regard to the conduct of the University vis-a-vis the petitioner that without reference to the petitioner, syllabus was changed; new courses were introduced; a new time table was set by the University and further the respondent University issued a notice of termination dated 30.7.2019. It is further averred in the petition Page 2 of 11 Downloaded on : Sun Oct 20 02:14:54 IST 2019 C/SCA/14529/2019 ORDER that a fear in the minds of students was created by the University. In context to the notice dated 30.7.2019, it indicates that the averments are made that the notice was in violation of principles of natural justice; the respondent University is involved in discharging public functions of imparting education.
5. Mr.Yatin Oza, learned Senior Counsel appearing with Mr.Nisarg Trivedi, learned advocate for the petitioner has extensively taken me to the contents of the agreement dated 6.4.2018 and emphasized on the Objectives and Scope of the Agreement and contended that the petitioner was, in fact, completely in control of the University, inasmuch as, with their object of improving the quality of education, it was the petitioner institute, which was, in fact, made In-charge of recruitment of staff, providing support for setting up of examination of paper evaluation providing counseling support to the University for admission of the students etc. Page 3 of 11 Downloaded on : Sun Oct 20 02:14:54 IST 2019 C/SCA/14529/2019 ORDER
6. Shortly, the submission of learned counsel for the petitioner was that the petitioner institute was discharging functions which were sovereign in nature between the parties and, therefore, this Court should not treat the contract as an ordinary contract between the private parties and oust the petitioner solely on the ground that the petition under Article 226 of the Constitution was not maintainable.
7. Inviting my attention to the notice under challenge dated 30.7.2019, Mr.Oza would contend that notice is completely cryptic and, therefore, this Court should not have any reservation in exercising the powers under Article 226 of the Constitution of India and the impugned notice must be set aside in accordance with the prayers so made.
8. Inviting my attention to the contents of the affidavit-
in-reply, Mr.Oza would contend that the language of Page 4 of 11 Downloaded on : Sun Oct 20 02:14:54 IST 2019 C/SCA/14529/2019 ORDER the affidavit, inasmuch as, the words "there is no scope for interference by this Hon'ble Court under Article 226 of the Constitution of India. That even under Article 226 of the Constitution of India, the Hon'ble High Court has no power or jurisdiction to prevent the respondent from terminating a private contract with the service provider" are offensive words used in an affidavit. Moreover, "the ex-parte ad-interim relief has been erroneously granted to the petitioner" is the most offensive language in the reply.
9. Mr.Anshin Desai, learned Senior Counsel appearing with Mr.Parth Contractor, learned advocate for the respondent - University would contend that whatever orally argued, does not form part of the pleadings. He has invited my attention to the prayers made in the petition. He further submits that impugned notice is dated 30.7.2019; the petition is filed on 26.8.2019; moved on 27.8.2019 and an ex- parte ad-interim relief has been granted more than a Page 5 of 11 Downloaded on : Sun Oct 20 02:14:54 IST 2019 C/SCA/14529/2019 ORDER month after the impugned notice.
10. To the submission of Mr.Oza, learned counsel for the petitioner that whether the University could have entered into such an agreement, Mr.Desai, learned Senior Counsel for the respondent - University would contend that, that itself justifies the ousting of the petitioner because even according to the petitioner, the agreement of such a nature could not have been entered into. Inviting my attention to Clause 5.2 of the agreement, Mr. Desai would contend that Clause 5.3 of the agreement specifically provides for an arbitration Clause and, therefore, on such short ground, the petition be not entertained. Clause 5.3 reads as under:
"5.3 In case of there being any dispute, this may be referred to an Arbitrator who would be appointed after mutual agreement and the arbitrator shall give his decision in accordance with Ahmedabad Jurisdiction."
11. Mr.Desai, learned Senior Counsel for the respondent
- University has further submitted that precursor to the notice dated 30.7.2019, as early as in April, on Page 6 of 11 Downloaded on : Sun Oct 20 02:14:54 IST 2019 C/SCA/14529/2019 ORDER 11.4.2019, a detailed discussion in the context of the subject matter of the impugned notice, was undertaken as is so evident from page No.76 of the Paper-Book, wherein, the minutes of the meeting are set out. He has invited my attention to various issues discussed and the the conclusion arrived at.
12. According to Mr.Desai, learned Senior Counsel for the respondent - University, even prior thereto, on 9.2.2019, an e-mail was addressed with regard to the irregularity in the execution of the agreement. In short, Mr.Desai's submission was that, this Court, in a petition under Article 226 of the Constitution of India, should not exercise jurisdiction in a dispute, which was, in the realm of the contract and which would tantamount to enforcing an agreement, especially when the agreement itself provides for an arbitration.
13. Having considered the submissions of the learned advocates for respective parties and having gone Page 7 of 11 Downloaded on : Sun Oct 20 02:14:54 IST 2019 C/SCA/14529/2019 ORDER through the memo of petition and the reply and rejoinder filed by the parties to this petition, without going into the issue as so contended by Mr.Oza, learned Senior Counsel for the petitioner on the propriety of the University entering into such an agreement, perusal of the agreement itself indicates that there was a contract between the petitioner and respondent - University.
14. On reading of email dated 9.2.2019 and the minutes of the meeting dated 11.4.2019, without going into the merits of the issue involved in the petition, what is apparent is that there are disputed questions of fact regarding the performance of the contract inter
-se and, therefore, I need not exercise extraordinary powers under Article 226 of the Constitution of India.
15. In addition thereto, what is under challenge is a notice-cum-termination for revocation of contractual agreement dated 30.7.2019 - Clause 5.3 of the Page 8 of 11 Downloaded on : Sun Oct 20 02:14:54 IST 2019 C/SCA/14529/2019 ORDER Agreement specifically provides as the parties to such agreement shall go into an arbitration.
16. Admittedly, when both the parties have by virtue of an agreement entered by and between them, have agreed to submit to an arbitrator, this Court would be loath in exercising its powers under Article 226 of the Constitution of India. I find support from the judgment cited by Mr.Desai, learned Senior Counsel for the respondent - University in the case of Nirmal Software Services Private Limited v. Dr. Babasahed Ambedkar Mararthwada reported in 2019(7) SCC 356, more particularly, Paragraph Nos.6 and 8 of the judgment, which read as under:
"6. Aggrieved, the petitioner has filed the present SLP. During the course of hearing, this Court vide order dated 8-4-2019 recorded the submission of the counsel for the petitioner to refer the issue to arbitration in terms of the MoU. On the basis of this statement, notice was issued to the respondent.
8. On the joint request of the parties, we appoint Mr.Justice Pratap Hardas (Retd.) as the sole arbitrator, subject to the declarations being made under Section 12 of Page 9 of 11 Downloaded on : Sun Oct 20 02:14:54 IST 2019 C/SCA/14529/2019 ORDER the Arbitration and Conciliation Act, 1996 with respect to independence and impartiality, and the ability to devote sufficient time to complete the arbitration within the period of 12 months. The parties have agreed to pay fees to the arbitrator in accordance with the Fourth Schedule to the Arbitration and Conciliation Act, 1996 as amended. As per the MoU, the seat / place of arbitration shall be Aurangabad."
17. In view of this settled position of law, I see no reason to exercise extraordinary jurisdiction under Article 226 of the Constitution of India in favour of the petitioner. Hence, the petition stands dismissed with no order as to costs. Ad-interim relief granted by order dated 27.8.2019 is vacated forthwith.
18. At this stage, Mr.Oza, learned counsel for the petitioner requests that ad-interim relief granted by order dated 27.8.2019 be continued for a further period of two weeks. Looking to the fact that notice impugned is dated 30.7.2019 and when I have held that petition under Article 226 of the Constitution of India is not maintainable and that the petitioner thought it fit to approach the Court almost after a Page 10 of 11 Downloaded on : Sun Oct 20 02:14:54 IST 2019 C/SCA/14529/2019 ORDER month but not immediately, I see no reason to continue ad-interim relief granted by order dated 27.8.2019. Therefore, such request is rejected.
(BIREN VAISHNAV, J) *** VATSAL Page 11 of 11 Downloaded on : Sun Oct 20 02:14:54 IST 2019