Chattisgarh High Court
Banshidhar Gupta vs State Of Chhattisgarh on 1 May, 2026
Author: Ramesh Sinha
Bench: Ramesh Sinha
1
2026:CGHC:20397-DB
Digitally signed by
ALOK SHARMA NAFR
Date: 2026.05.05
10:45:32 +0530
HIGH COURT OF CHHATTISGARH AT BILASPUR
WPC No. 4471 of 2019
1 - Banshidhar Gupta S/o Late Shri Mohan Sao Aged About 63 Years
Occupation Contractor, Ward No. 9, Main Road, Balrampur, District
Balrampur Ramanujganj Chhattisgarh., District : Balrampur,
Chhattisgarh
... Petitioner(s)
versus
1 - State Of Chhattisgarh Through Its Secretary, Department Of Rural
Engineering Service, Mahanadi Bhawan, Mantralaya, Atal Nagar, Naya
Raipur, District Raipur Chhattisgarh., District : Raipur, Chhattisgarh
2 - Executive Engineer Rural Engineering Service, Balrampur Division,
District Balrampur Ramanujganj Chhattisgarh., District : Balrampur,
Chhattisgarh
3 - Collector District Balrampur Ramanujganj Chhattisgarh., District :
Balrampur, Chhattisgarh
4 - Chief Executive Officer District Balrampur Ramanujganj
Chhattisgarh., District : Balrampur, Chhattisgarh
5 - Chief Executive Officer Zila Panchayat, District Balrampur,
Ramanujganj Chhattisgarh., District : Balrampur, Chhattisgarh
... Respondent(s)
For Petitioner(s) : Mr. K. R. Nair, Advocate.
For Respondent/State : Mr. Shashank Thakur, Dy. Advocate
General.
For Respondent No. 5 : Mr. Rakesh Kumar Jha, Advocate. 2 Hon'ble Shri Ramesh Sinha, Chief Justice Hon'ble Shri Ravindra Kumar Agrawal, Judge Order on Board Per Ramesh Sinha, Chief Justice 01/05/2026
1. Heard Mr. K. R. Nair, learned counsel for the petitioner. Also heard Mr. Shashank Thakur, learned Deputy Advocate Geneal, appearing for the State, Mr. Rakesh Kumar Jha, learned counsel for the Respondent No.5.
2. By this petition under Article 226 of the Constitution of India, the petitioner seek for the following relief(s):
"10.1. This Hon'ble Court may be pleased to direct the respondents to make payment of Rs.6.09 lacs for the work executed by petitioner and certified by the respondents in Measurement Book with interest thereon till the date of payment.
10.2. This Hon'ble Court may be pleased to award cost of the litigation from the respondents.
10.3. This Hon'ble Court may be pleased to issue any other appropriate orders or directions in favour of the petitioner and against the respondents in the interest of justice."
3. The brief facts of the case are that the petitioner was awarded a contract on 15.12.2016 by the Executive Engineer, Rural Engineering Service (RES), Balrampur for construction of a boundary wall at Pahadi Korva Aashram, Bhelwadih, valued at Rs.12.28 lacs, which he 3 completed on 17.09.2017 within the stipulated time to the satisfaction of the authorities. The work executed by the petitioner, valued at Rs.11,59,288/-, stands duly recorded and certified in Measurement Book (MB No. 576) maintained by RES officer. However, despite such certification, the petitioner was paid only Rs.5,16,140/- under the head of "supply of materials," though he neither received any such work order nor supplied any materials. It is the petitioner's case that thereafter the entries in the Measurement Book were tampered with by unauthorisedly scoring out his name and inserting the name of Gram Panchayat Bhelwadih without any approval or attestation, and on that basis payments were allegedly diverted to the said Panchayat, which had not executed the work. The petitioner made several representations and also issued a legal notice, but no relief was granted; rather, the authorities took a stand that the work was executed by the Panchayat, whereas the Executive Engineer, RES, in his communications, confirmed that the work was executed under RES supervision and that the change of executing agency was unauthorized, thereby depriving the petitioner of his legitimate dues, compelling him to file the present petition.
4. Learned counsel for the petitioner submits that The petitioner respectfully submits that he was duly awarded the contract for construction of the boundary wall by the competent authority of the Rural Engineering Services (RES), Balrampur, and executed the entire work within the stipulated period to the full satisfaction of the respondent authorities. The execution of work and its valuation to the tune of 4 Rs.11,59,288/- stands duly recorded and certified in the official Measurement Book (MB) maintained by RES Officers, which constitutes the primary and conclusive record of work done. Despite such certification, the respondents have arbitrarily and unlawfully withheld the legitimate payment of the petitioner by falsely attributing part payment towards alleged supply of materials an act unsupported by any work order, bill, or record. The petitioner categorically denies having supplied any material, and the said adjustment is nothing but a device to deprive him of his rightful dues.
5. It is further submitted that after completion of the work, the entries in the Measurement Book were tampered with by unauthorisedly scoring out the petitioner's name and inserting the name of Gram Panchayat, without any attestation or approval from the competent authority, in clear violation of established procedure. The Gram Panchayat neither executed the work nor maintained any MB entries, yet payments have been wrongfully released in its favour, which demonstrates a mala fide attempt to misappropriate public funds and deny payment to the petitioner. The shifting stand of the respondents regarding the executing agency, coupled with absence of any credible record supporting the Panchayat's claim, renders their defence untenable. In such circumstances, where the work stands completed and duly certified, the respondents are duty-bound to release the outstanding amount to the petitioner within a reasonable time, and their continued inaction warrants interference by this Court for issuance of appropriate directions for payment of the admitted dues in a time-bound 5 manner.
6. On the other hand, learned counsel for the respondents-State submits that the present petition is wholly misconceived and devoid of merit, as the State authorities have already discharged their entire financial liability in respect of the construction work in question. It is an admitted position that an amount of Rs.12.28 lacs was duly sanctioned for construction of the boundary wall of Part-1 for Village Panchayat Bhelwadih, and pursuant to the administrative approval dated 09/01/2018, the Gram Panchayat Bhelwadih was appointed as the Construction/Implementation Agency. In furtherance thereof, a valid agreement was executed with the Sarpanch and Secretary of the said Gram Panchayat, and the entire sanctioned amount was released to the said agency in two instalments after due verification of the work and issuance of completion certificate. Thus, from the standpoint of the State, the contractual and financial obligations stand fully satisfied, leaving no subsisting liability towards the petitioner. It is further submitted that the petitioner has failed to establish any privity of contract with the answering respondents in respect of the work executed under the said administrative sanction dated 09/01/2018. The work order dated 15/12/2016, relied upon by the petitioner, is not relatable to the work in question, for which the Gram Panchayat was subsequently appointed as the executing agency. In absence of any contractual relationship between the petitioner and the State for the said work, no claim for payment can be maintained against the answering respondents. If at all the petitioner has executed any work under or 6 through the Gram Panchayat, his remedy, if any, lies against the said agency and not against the State authorities, who have already disbursed the entire amount after due process and verification. Hence, the present petition, being legally untenable, deserves to be dismissed.
7. Learned counsel appearing for the Respondent No.2, submits that the present petition is misconceived and not maintainable, as no liability lies against this respondent. It is submitted that pursuant to the administrative sanction dated 09.01.2018 issued by the District Collector, Gram Panchayat Bhelwadih was duly appointed as the Construction/Implementation Agency for execution of the boundary wall work, and a valid agreement was executed with its Sarpanch and Secretary on 10.01.2018. The entire sanctioned amount of Rs.12.28 lacs was released to the said Gram Panchayat in two instalments after due verification, and the work stands completed with a completion certificate and photographic evidence on record. The petitioner has no privity of contract with respondent No. 5 in respect of the said work, and the work order dated 15.12.2016 relied upon by him does not pertain to the work executed under the aforesaid sanction. If the petitioner claims to have executed any work, his remedy, if any, lies against the Gram Panchayat and not against this respondent, who has lawfully discharged all obligations, hence, the petition, being devoid of merit, deserves to be dismissed.
8. We have learned counsel for the parties, perused the material annexed with the petition.
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9. The Hon'ble Supreme Court in the case of Tata Motors Limited v The Brihan Mumbai Electric Supply & Transport Undertaking (Best) and Others passed in Civil Appeal No. 3897 of 2023 vide judgment dated 19.05.2023 held as follows :
"48. This Court being the guardian of fundamental rights is duty-bound to interfere when there is arbitrariness, irrationality, mala fides and bias. However, this Court has cautioned time and again that courts should exercise a lot of restraint while exercising their powers of judicial review in contractual or commercial matters. This Court is normally loathe to interfere in contractual matters unless a clear-cut case of arbitrariness or mala fides or bias or irrationality is made out. One must remember that today many public sector undertakings compete with the private industry. The contracts entered into between private parties are not subject to scrutiny under writ jurisdiction. No doubt, the bodies which are State within the meaning of Article 12 of the Constitution are bound to act fairly and are amenable to the writ jurisdiction of superior courts but this discretionary power must be exercised with a great deal of restraint and caution. The courts must realise their limitations and the havoc which needless interference in commercial matters can cause. In contracts involving technical issues the courts should be even more reluctant because most of us in Judges' robes do not have the necessary expertise to adjudicate upon technical issues beyond our domain. The courts should not use a magnifying glass while scanning the tenders and make every small mistake appear like a big blunder. In fact, the courts must give "fair play in the joints" to the government and public sector undertakings in matters of contract. Courts must also not interfere where such interference will cause unnecessary loss to the public exchequer. (See: Silppi Constructions Contractors v. Union of India, (2020) 16 SCC 489).
52. Ordinarily, a writ court should refrain itself from imposing its decision over the decision of the employer 8 as to whether or not to accept the bid of a tenderer unless something very gross or palpable is pointed out. The court ordinarily should not interfere in matters relating to tender or contract. To set at naught the entire tender process at the stage when the contract is well underway, would not be in public interest. Initiating a fresh tender process at this stage may consume lot of time and also loss to the public exchequer to the tune of crores of rupees. The financial burden/implications on the public exchequer that the State may have to meet with if the Court directs issue of a fresh tender notice, should be one of the guiding factors that the Court should keep in mind. This is evident from a three-Judge Bench decision of this Court in Association of Registration Plates v. Union of India and Others, reported in (2005) 1 SCC 679.
53. The law relating to award of contract by the State and public sector corporations was reviewed in Air India Ltd. v. Cochin International Airport Ltd., reported in (2000) 2 SCC 617 and it was held that the award of a contract, whether by a private party or by a State, is essentially a commercial transaction. It can choose its own method to arrive at a decision and it is free to grant any relaxation for bona fide reasons, if the tender conditions permit such a relaxation. It was further held that the State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision-making process, the court must exercise its discretionary powers under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should interfere.
54. As observed by this Court in Jagdish Mandal v. State of Orissa and Others, reported in (2007) 14 SCC 517, that while invoking power of judicial review in matters as to tenders or award of contracts, certain 9 special features should be borne in mind that evaluations of tenders and awarding of contracts are essentially commercial functions and principles of equity and natural justice stay at a distance in such matters. If the decision relating to award of contract is bona fide and is in public interest, courts will not interfere by exercising powers of judicial review even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. Power of judicial review will not be invoked to protect private interest at the cost of public interest, or to decide contractual disputes."
10. Upon perusal of the judgment passed by the Hon'ble Supreme Court in Tata Motors Limited (Supra), as the Apex Court has categorically held that judicial review in contractual matters must be exercised with great restraint and only in cases where clear arbitrariness, mala fides, bias or irrationality is demonstrated, this Court finds that no such exceptional circumstance is made out in the present case. The dispute raised by the petitioner essentially pertains to non- release of alleged contractual dues and involves disputed questions of fact, including the actual execution of work, correctness and authenticity of entries in the Measurement Book, and the identity of the executing agency, which require detailed examination of evidence. Such issues cannot be adjudicated in exercise of writ jurisdiction under Article 226 of the Constitution of India. The scope of judicial review in contractual matters being limited, and in absence of any material to establish arbitrariness or illegality in the decision-making process of the respondents, this Court is not inclined to interfere. Accordingly, in light of the settled legal position, the present petition is misconceived, devoid of merit, and is liable to be dismissed, leaving it open to the petitioner to 10 avail appropriate alternative remedies available under law.
11. The principal question which arises for consideration is whether this Court, in exercise of its claim for payment arising out of an alleged contractual arrangement, when the foundational extraordinary jurisdiction under Article 226 of the Constitution of India, ought to entertain a facts giving rise to such claim are themselves seriously disputed. The petitioner asserts that he was satisfaction of the authorities, as reflected in the Measurement Book. Per contra, the respondents have taken a categorical stand that the work in question was subsequently sanctioned in favour of the Gram Panchayat as the executing agency in 2018, pursuant to which the entire amount has already been disbursed. The rival stands not only disputes the existence of a subsisting contractual relationship between the petitioner and the State in respect of the work in question, but also raises serious issues as to the identity of the executing agency and the authenticity of official records.
12. It is trite law that writ jurisdiction is not intended to supplant ordinary civil remedies, particularly in matters involving contractual disputes requiring adjudication of complex and disputed questions of fact. In "State of Bihar v. Jain Plastics and Chemicals Ltd.", 2002 (1) SCC 216, the Hon'ble Supreme Court has held that where the claim arises out of breach of contract and involves disputed facts, the appropriate remedy lies in a civil suit and not in a writ petition. In paragraph 7, it has been observed that:-
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"7. In the present case many matters could be decided after referring to the contentions raised in the affidavits and counter-affidavits, but that would hardly be a ground for exercise of extraordinary jurisdiction under Article 226 of the Constitution in case of alleged breach of contract. Whether the alleged non-supply of road permits by the appellants would justify breach of contract by the respondent would depend upon facts and evidence and is not required to be decided or dealt with in a writ petition. Such seriously disputed questions or rival claims of the parties with regard to breach of contract are to be investigated and determined on the basis of evidence which may be led by the parties in a properly instituted civil suit rather than by a court exercising prerogative of issuing writs."
13. Though in "ABL International Ltd. v. Export Credit Guarantee Corporation of India Ltd.", 2004 (3) SCC 553, the Hon'ble Apex Court recognized that a writ petition may be maintainable in contractual matters in limited circumstances, it was clearly observed that such jurisdiction is to be exercised where the facts are undisputed or where the State action is patently arbitrary, unreasonable, or in violation of Article 14. The present case does not fall within such an exception, as the very substratum of the petitioner's claim is contested.
14. A further dimension of the dispute relates to the allegation of tampering with entries in the Measurement Book and diversion of funds in favour of the Gram Panchayat. These allegations, though serious in nature, necessarily require detailed examination of records, scrutiny of original documents, and possibly oral evidence to establish the manner in which entries were made, altered, or authenticated. The respondents, on the other hand, rely upon administrative sanction, execution of the agreement with the Gram Panchayat, and completion certificates to 12 justify the payments already made. Such competing claims cannot be resolved on the basis of affidavits alone. As held by the Hon'ble Supreme Court in "Joshi Technologies International Inc. v. Union of India", 2015 (7) SCC 728, where adjudication involves serious factual controversies necessitating evidence, the writ court should decline to exercise jurisdiction and relegate the parties to appropriate forums. In paragraphs 69 and 70, the legal position has been summarised that:-
"69. The position thus summarised in the aforesaid principles has to be understood in the context of discussion that preceded which we have pointed out above. As per this, no doubt, there is no absolute bar to the maintainability of the writ petition even in contractual matters or where there are disputed questions of fact or even when monetary claim is raised. At the same time, discretion lies with the High Court which under certain circumstances, it can refuse to exercise. It also follows that under the following circumstances, "normally", the Court would not exercise such a discretion:
69.1. The Court may not examine the issue unless the action has some public law character attached to it.
69.2. Whenever a particular mode of settlement of dispute is provided in the contract, the High Court would refuse to exercise its discretion under Article 226 of the Constitution and relegate the party to the said mode of settlement, particularly when settlement of disputes is to be resorted to through the means of arbitration.
69.3. If there are very serious disputed questions of fact which are of complex nature and require oral evidence for their determination.
69.4. Money claims per se particularly arising out of contractual obligations are normally not to be entertained except in exceptional circumstances.
70. Further, the legal position which emerges from various Judgments of this Court dealing with different 13 situations/aspects relating to contracts entered into by the State/public authority with private parties, can be summarised as under:
70.1. At the stage of entering into a contract, the State acts purely in its executive capacity and is bound by the obligations of fairness.
70.2. State in its executive capacity, even in the contractual field, is under obligation to act fairly and cannot practise some discriminations.
70.3. Even in cases where question is of choice or consideration of competing claims before entering into the field of contract, facts have to be investigated and found before the question of a violation of Article 14 of the Constitution could arise. If those facts are disputed and require assessment of evidence the correctness of which can only be tested satisfactorily by taking detailed evidence, involving examination and cross-examination of witnesses, the case could not be conveniently or satisfactorily decided in proceedings under Article 226 of the Constitution. In such cases the Court can direct the aggrieved party to resort to alternate remedy of civil suit, etc. 70.4. Writ jurisdiction of the High Court under Article 226 of the Constitution was not intended to facilitate avoidance of obligation voluntarily incurred.
70.5. Writ petition was not maintainable to avoid contractual obligation. Occurrence of commercial difficulty, inconvenience or hardship in performance of the conditions agreed to in the contract can provide no justification in not complying with the terms of contract which the parties had accepted with open eyes. It cannot ever be that a licensee can work out the licence if he finds it profitable to do so: and he can challenge the conditions under which he agreed to take the licence, if he finds it commercially inexpedient to conduct his business.
70.6. Ordinarily, where a breach of contract is complained of, the party complaining of such breach may sue for specific performance of the contract, if contract is capable 14 of being specifically performed. Otherwise, the party may sue for damages.
70.7. Writ can be issued where there is executive action unsupported by law or even in respect of a corporation there is denial ofequality before law or equal protection of law or if it can be shown that action of the public authorities was without giving any hearing and violation of principles of natural justice after holding that action could not have been taken without observing principles of natural justice.
70.8. If the and the contract between private party State/instrumentality and/or agency of the State is under the realm of a private law and there is no element of public law, the normal course for the aggrieved party, is to invoke the remedies provided under ordinary civil law rather than approaching the High Court under Article 226 of the Constitution of India and Invoking its extraordinary jurisdiction.
70.9. The distinction between public law and private law element in the contract with the State is getting blurred.
However, it has not been totally obliterated and where the matter falls purely in private field of contract, this Court has maintained the position that writ petition is not maintainable. The dichotomy between public law and private law rights and remedies would depend on the factual matrix of each case and the distinction between the public law remedies and private law field, cannot be demarcated with precision. In fact, each case has to be examined, on its facts whether the contractual relations between the parties bear insignia of public element. Once on the facts of a particular case it is found that nature of the activity or controversy involves public law element, then the matter can be examined by the High Court in writ petitions under Article 226 of the Constitution of India to see whether action of the State and/or instrumentality or agency of the State is fair, just and equitable or that relevant factors are taken into consideration and irrelevant factors have not gone into the decision-making process or that the decision is not arbitrary.
70.10. Mere reasonable or legitimate expectation of a citizen, in such a situation, may not by itself be a distinct 15 enforceable right, but failure to consider and give due weight to it may render the decision arbitrary, and this is how the requirements of due consideration of a legitimate expectation forms part of the principle of non-
arbitrariness.
70.11. The scope of judicial review in respect of disputes falling within the domain of contractual obligations may be more limited and in doubtful cases the parties may be relegated to adjudication of their rights by resort to remedies provided for adjudication of purely contractual disputes."
15. In the considered opinion of this Court, the present petition essentially seeks recovery of money based on an alleged contract, the existence and enforceability of which are themselves under serious dispute. The determination of whether the petitioner had any privity of Contract with the respondents, whether he executed the work independently or through the Gram Panchayat, and whether any amount executed awfully payable to him, would require a full-fledged trial. Such an exercise is beyond the permissible scope of writ proceedings.
16. In view of the foregoing analysis and the settled position of law as enunciated in the case of Jain Plastics and Chemicals Ltd. (supra) and Joshi Technologies International Inc., (supra) this Court is of the considered opinidsupra) and Joshi Teri petition, involving seriously disputed questions of fact relating to the award of contract, execution of work, and entitlement to payment, is not amenable to adjudication under Article 226 of the Constitution of India. The petitioner has failed to establish a clear and undisputed legal right warranting interference in writ jurisdiction. Accordingly, the writ petition stands dismissed. 16
17. However, it is made clear that dismissal of the present petition shall not preclude the petitioner from availing such alternative remedies as may be available to him in accordance with law, including seeking appropriate relief before the competent civil court or any other forum.
18. No order as to costs.
Sd/- Sd/-
(Ravindra Kumar Agrawal) (Ramesh Sinha)
Judge Chief Justice
Alok