M/S Green Minit India Agritech P ... vs The Government Of India,
2021 Latest Caselaw 4573 AP

Citation : 2021 Latest Caselaw 4573 AP
Judgement Date : 11 November, 2021

Andhra Pradesh High Court - Amravati

M/S Green Minit India Agritech P ... vs The Government Of India, on 11 November, 2021

Bench: C.Praveen Kumar, Ravi Nath Tilhari

     THE HONOURABLE SRI JUSTICE C.PRAVEEN KUMAR
                         AND
     THE HONOURABLE SRI JUSTICE RAVI NATH TILHARI

            COMMERCIAL COURT APPEAL No.1 OF 2021

JUDGMENT:- (Per Hon'ble Sri Justice C.Praveen Kumar)


       Heard Sri P.Veera Reddy, learned Senior Counsel appearing

on behalf of Sri K.Koteswara Rao, learned counsel for the

appellant; Sri C.Prakash Reddy, learned counsel for respondent

No.5; Sri T.Balaji, learned counsel appearing for respondent No.7

and Sri N.Harinath, learned Assistant Solicitor General.

2. The facts, which lead to filing of the present appeal, are as

under:

The 5th respondent herein insured the stock, which was

stored with the 7th respondent, to an extent of Rs.20 Crores. It is

said that due to Hud-Hud Cyclone, there was damage to part of the

stock stored in godown by the 7th respondent. Pursuant thereto,

the 6th respondent-Surveyor was appointed to assess the damage

and accordingly, it was assessed at Rs.8 Crores. Be that as it may,

respondent Nos.5 and 7 thought of selling the damaged stock and

as such called for tenders. Out of four bidders, the present

appellant was the highest bidder quoting a sum of

Rs.2,31,27,657/- for purchase of salvaged stock. Immediately

thereafter, EMD of Rs.21,38,300/- was deposited. It is represented

by Sri Veera Reddy, learned Senior Counsel, that subsequently the

balance amount was also paid through demand drafts to 7th

respondent, who in turn handed over the same to 5th respondent

and same was encashed. Though the amount was paid, the

damaged stock was not released in favour of the appellant, who

was highest bidder. Pursuant thereto, representation came to be

made for release of the stock. Inaction of respondents lead to filing

of C.O.S.No.18 of 2017 before the Court of the Special Judge for

trial and disposal of commercial disputes, Visakhapatnam.

Pending suit, the appellant herein filed I.A.No.161 of 2019 for

release of EMD amount in a summary manner, on the ground that

it is an admitted amount. Rejection of the same lead to filing of the

present appeal.

3. Sri P.Veera Reddy, learned Senior Counsel, would contend

that in view of the letter dated 18.08.2016, addressed by the

Insurance Company to the 7th respondent and the averments in

counter filed by the 5th respondent-New India Assurance Company

Limited in the said I.A, the trial Court committed an error in

dismissing the petition.

4. However, the learned counsel appearing for the 7th

respondent would contend that the 7th respondent in its counter

affidavit filed before the trial Court disputed the claim made

including the return of EMD amount.

5. As seen from the record, on 18.08.2016, the 5th respondent

addressed a letter to the 7th respondent, stating that such

authority has to return the EMD amount to the appellant as it is

entitled to for the said amount. Counter filed by the 5th

respondent-Insurance Company in I.A. also states that the

appellant is entitled for refund of EMD from the 7th respondent.

However, para No.3 of the counter filed by the 7th respondent

shows that a dispute has been raised with regard to entitlement of

the amount by the appellant. It will be appropriate to extract the

same, which is as under:

"The petition is totally speculative and not maintainable under law and liable to be dismissed in limini.

It is submitted that as per Condition No.2.5 of Tender Conditions the successful bidder has to deposit the full value of the bid amount by way of demand draft within 7 days of receipt of delivery order. As per Condition No.2.7 in the event of failure to pay the bid amount the bid shall stand cancelled and EMD shall be forfeited and he shall have no claim over the seller or on any goods in any manner. Admittedly the petitioner-plaintiff failed to pay the bid amount by way of demand draft and thus committed default in payment. Consequently the EMD of Rs.21,38,300/- automatically stood forfeited. Therefore question of refunding the same more particularly by way of summary judgment does not arise."

6. In view of the dispute raised by the 7th respondent, we hold

that the order of the trial Court rejecting the claim of the appellant

warrants no interference. Things would have been different had

the 7th respondent admitted the claim made by the appellant. In

the absence of the same, the relief as sought for by the appellant

cannot be granted.

7. Accordingly, the Appeal is dismissed. It is needless to

mention that the trial Court shall take steps for disposal of

C.O.S.No.18 of 2017, as early as possible, preferably within a

period of six (6) months from the date of receipt of a copy of this

order. There shall be no order as to costs.

Miscellaneous petitions pending, if any, in this Appeal shall