For Petitioner(s) : Ms. Saloni Jain, Advocate
For Respondent No. 1, 4 and 5/ : Mr. P.K.Bhaduri, Deputy Advocate General.
State
For Respondent No. 2 and 3/ : Mr. Raghavendra Pradhan and Mr. Trivikram
CGMSCL Nayak, Advocates.
Karl Storz Endoscopy India Pvt. Ltd. Through Its Authorized Representative
Mr. Vikas Sharma , Aged About 37 Years, S/o Shri Som Parkash Sharma,
Office At 11th Floor, Dr. Gopal Das Bhawan , 28 Barakhamba Road, New Delhi
---Petitioner(s)
Family Welfare Mantralaya Mahanadi Bhawan Atal Nagar, Raipur,
Limited. North West Commercial Complex , Sector 27, Atal Nagar, Raipur,
Chhattisgarh Medical Services Corporation Limited. North West Commercial
Complex , Sector 27, Atal Nagar, Raipur , Chhattisgarh.
Superintendent , Dks Bhawan, Shastri Chowk Raipur Chhattisgarh.
For Petitioner(s) : Mr. Sabyasachi Bhaduri, Advocate.
For Respondents No. 1, 4, 5 & : Mr. P.K.Bhaduri, Deputy Advocate General.
1. Heard Ms. Saloni Jain and Mr. Sabyasachi Bhaduri, learned counsel
appearing for the respective petitioners. Also heard Mr. P.K.Bhaduri,
learned Deputy Advocate General for the State, and Mr. Raghavendra
Pradhan, Mr. Trivikram Nayak, learned counsel for the respondent-
2. Since the facts and issue involved in these petitions are identical, they
are being considered and decided by this common order.
3. In WPC No. 750/2021, the petitioner has prayed for the following
10.2 That the Hon'ble Court may kindly be pleased to direct
the Respondent Corporation to make good remittance of the
payment pending to be made to petitioner for the services
already rendered by the petitioner.
10.3 That the Hon'ble Court may kindly be pleased to direct
the Respondent Corporation to make the outstanding
payments as per the invoices raised by the Petitioner
alongwith interest.10.4 That the Hon'ble Court may kindly be
pleased to grant any other relief(s)/ order(s)/ direction(s) in
favour of petitioner, which this Hon'ble Court may deem fit
and proper in the facts and circumstances of the case, in the
interest of justice.
10.5 Cost of the petition."
4. In WPC No. 2846/2021, the petitioners have prayed for the following
relief(s):
"10.1 This Hon'ble Court may kindly be pleased to call for
record of entire tender process which is subject matter of the
present petition.
10.2 That the Hon'ble Court may kindly be pleased to direct
the Respondent Corporation to make good remittance of the
payment pending to be made to petitioner for the goods and
services already rendered by the petitioner.
10.3 That the Hon'ble Court may kindly be pleased to direct
the Respondent Corporation to make the outstanding
payments as per the invoices raised by the Petitioner
alongwith interest.
10.4 That the Hon'ble Court may kindly be pleased to grant
any other relief(s)/ order(s)/ direction(s) in favour of petitioner.
which this Hon'ble Court may deem fit and proper in the facts
and circumstances of the case, in the interest of justice.
10.5 Cost of the petition."
5. The facts, as projected by the petitioner(s) are that the respondent-
Chhattisgarh Medical Services Corporation Limited (for short, the
Corporation) floated multiple Notices Inviting Tenders for the purchase of
numerous medical tools and equipment for the procurement and
distribution of the equipments and then infrastructure services to DKS
Hospital and other Medical Departments of the State. The idea of the
State, probably, was to furnish the Hospitals of the State with super
specialty equipments and top most infrastructure and facilities, so as, to
match to the qualities of the best hospitals of India. In furtherance of the
said scheme, the respondent-Corporation invited proposals (bids) for the
purpose of executing rate contract from the prospective organizations.
The petitioners applied for the same and were the successful bidder/
lowest bidder (L1) and subsequently they were given was given two
purchase orders (in WPC No. 750/2021) and 12 purchase orders (in
WPC No. 2846/2021). The petitioners successfully completed all the
purchase orders and delivered the requisite equipments in time to the
concerned medical units of the State. The respondents had never
disputed the quality or pointed out any defect in the equipments
delivered by the petitioners. Thereafter, the petitioners raised invoices
against the said purchase orders as per the terms of the contract.
However, the respondents only made partial payment of the bills and
never attempted to repay the remaining amount. The petitioenrs made
several requests and reminders to the concerned Departments of the
respondents for the release of the remaining amount due against the
said tenders but to no avail. Despite repeated requests and reminders
from the petitioner to release the balance amount, the respondent
Department did not pursue the same. The petitioners duly attended the
equipment supplied by them and provided the regular servicing, repairs
and the preventive maintenance as per the terms of the agreement
despite the non payment of the invoices. Aggrieved by the non payment
of the legitimate dues, the petitioners made a representations before the
concerned Department of the Respondent but to no avail.
6. Ms. Saloni Jain and Mr. Sabyasachi Bhaduri, learned counsel for the
respective petitioners that till date, the respondents have failed to make
good their liabilities which raises a reasonable apprehension, and
keeping in view the high-handedness of the respondents, it is clear that
they would never make good their liabilities. Under the peculiar
circumstance, the petitioner have no alternative efficacious remedy but to
approach this Hon'ble Court. The State being the guardian of its citizens
and being the trustee of the finance of the State is expected to act in
utmost sincerity and transparency in every walk more-so when it relates
to a health and welfare of its citizen which is of prime importance for
nation as whole and State in particular and shall serve the citizens. The
amount charged by the petitioners is as per the terms of the contract and
the same has never been disputed by the respondent authorities. After a
considerable amount of time, wherein the respondent authorities have
even called upon the petitioner to adhere to the regular servicing of the
equipments, it can be safely assumed that the amount claimed by the
petitioner is an undisputed amount and therefore the petitioner is entitled
to claim the legitimate dues from the respondent Department. After
taking the supplies and receiving the services, the State/respondents as
well as the respondent/Corporation cannot shy away from their
responsibility of making the payment to the petitioners for which they are
legally entitled. In respect of WPC No. 750/2021, it is to be noted that
the respondent No. 2 has not paid the outstanding invoices amounting to
Rs. 5,00,33,500/- and Rs. 2,96,22,233/- in respect of WPC No.
2846/2021, which is an undisputed amount charged as per the terms of
the contract. Such conduct of the respondent/State as well as
respondent/Corporation is illegally depriving the petitioners of their
livelihood. Even if the claim of money arises out of contractual obligation,
then the Courts may intervene where the action of the State is arbitrary
which is the case in hand. Hence, these petitions deserve to be allowed.
7. On the other hand, Mr. P.K.Bhaduri, learned Deputy Advocate General
appearing for the State/respondents, submits that in these cases, the
respondent-Corporation would be the contesting respondent so far as
the issuance of tender, purchase of machinery and pendency of dues
against the installment of machinery is concerned. The respondent
Corporation has been incorporated on 7.10.2010 under the Companies
Act 1956 and is a Company operating under Health & Family Welfare
Department of Chhattisgarh. The respondent-Corporation has been
established to procure, test, store and supply of all kinds and variety of
generic drugs and medicines, suture and surgical items to the various
Health facilities (Medical Colleges, District Hospitals, CHCs and PHCs)
as per indent received from Health Department. The respondent
Corporation had floated a bunch of tenders for supply of medical
equipments and pursuant thereof the petitioners submitted their bid and
upon successful in the tender process, an agreement has been executed
between the petitioners and respondent Corporation. Thereafter, work
order has been issued in favour of the petitioners by the respondent
Corporation. The petitioners firm state that they raised invoices against
the said purchase orders as per the terms of the contract; however, the
Corporation only made partial payment of the total amount billed.
Thereafter, the respondent-Corporation never made any attempt to
repay the remaining amount to the petitioners. It is alleged that the
petitioners submitted representation to clear the outstanding dues to the
respondent Corporation. It is also pertinent to submit here that the
identical grievances have been raised by other Companies, which have
been denied the outstanding dues as similar to the petitioners on the
ground that, an FIR bearing Crime No. 70/2019 has been registered
against the then Superintendent of the respondent Hospital under
section 409, 420, 467, 468, 120B of IPC at Police Station Gol Bazar,
Raipur which is pending investigation by the police authorities regarding
certain irregularities in purchase of medical equipment. In relation to the
instant issue, a similar and identical writ petition was preferred by one
Bagree Enterprises, which was registered as W.P.(C) No. 2215/2020
before this Hon'ble Court and the same came to be disposed of by the
Hon'ble Court vide order dated 27.10.2020. Upon verification of the
records it is revealed that, all the NIT floated during the year 2018-2019
by the respondent Corporation are under investigation by Police Station
Golbazar as there is an offence registered by the Police Station
Golbazar, District Raipur (C.G.) for offence punishable under sections
409, 420, 467, 468, 120B of IPC against the then Superintendent of
DKS Post Graduate Institute & Research Center, Raipur. It is also
pertinent to submit here that in the aforesaid FIR relating to
misappropriation and embezzlement of Rs. 50.00 crore by the then
Superintendent of Respondent No. 4 Hospital, namely Dr. Punit Gupta
under various work including tender works for purchasing medicines,
drugs and medical equipment is being investigated. The Fact Finding
Committee (Inquiry Committee as constituted vide order dated
15.02.2019) has submitted its report before the State Government,
wherein, the misappropriation and embezzlement of government fund
has been prima-facie revealed as a consequence of which the State
Government has directed for registration of FIR so that the guilty can be
brought to book and the misappropriation of exchequer funds can be
accounted against the culprits, therefore, the claim of the petitioners
regarding payment of outstanding dues has been refused by the
respondent-Corporation. Since the aforesaid dispute is under
investigation by the concerned Police Station for unearthing the huge
misappropriation of Government fund, therefore, until and unless such
dispute is not ascertained / cleared, the respondent/State herein cannot
extend any funds for payment of dues, as is alleged by the petitioners as
there is possibility of huge financial loss to the State Government.
Moreover, it is relevant to highlight that in compliance of the order of the
Hon'ble Court in WPC 2215/2020, the Respondent No 4/DKS has
already rejected the claim of the petitioner in the said case vide order
dated 31.08.2021 on the grounds that the payment cannot be released
as for the said procurement an FIR has been registered for allegation of
irregularity of Rs 50 Crores by PS Gol Bazar for offences under 409,
420, 467, 468, 120 B IPC. On account of the report submitted by 03
members committee, serious irregularity and violation of purchase rules
for personal gain have been identified, which also includes criminal
offences, therefore, the FIR have been lodged. It is submitted that the
contents of the present matter clearly involves seriously disputed
question of facts. Moreover the petitioners have remedy available under
the Terms of Contract entered with respondent Corporation. It is settled
proposition of law that, in any commercial contract of a dispute arises
then for settlement and resolution of disputes the parties to contract
cannot raise grievance under extra ordinary jurisdiction under Article 226
of the Constitution of India. As such, the petitioners are not entitled to
any relief.
8. Mr. Raghavendra Pradhan and Mr. Trivikram Nayak, learned counsel
appearing for the respondent/CGMSCL, in addition to what has been
submitted by Mr. Bhaduri, would submit that these petitions are not
maintainable as the present involves contractual and disputed matters.
Further, there is an inordinate delay on the part of the petitioners as the
NIT was issued in the year 2017 and only in the year 2021, the
petitioners have approached this Court for payment of the alleged
outstanding dues. The petitioners have further alternative remedy as the
NIT itself provides for arbitration as a dispute resolution mechanism. As
per clause 21 of Section III provides for a dispute resolution mechanism
vide Arbitration and the nature of dispute is such, which can very well be
relegated to arbitration proceedings. Mr. Pradhan and Mr. Nayak would
submit that these petitions deserve to be dismissed as they involve disputed
questions of facts, the final payment, if at all is to be made by DKS Hospital,
when the agreement entered between the parties provides for a dispute
resolution mechanism vis-à-vis hence parties must exercise their
statutory efficacious alternate remedy of arbitration, there is unexplained
inordinate delay in approaching the Hon'ble High Court, similarly placed
parties in dispute have been referred to Arbitration. The instant matters
are a purely contractual one dealing with money claim of the petitioners
and that no exceptional circumstances have been made out for exercise
of writ powers in money related matter. It is clear that no case has been
made out by the petitioner for interference in the matter and these
petitions deserve to be dismissed sans merit. In support of their
contentions, they would place reliance on the decisions of the Apex
Court in Kerala SE v. Kurien E. Kalathil {(2000) 6 SCC 293}, Joshi
Technologies International Inc. v. Union of India {(2015) 7 SCC
728}, Chennai Metropolitan Water Supply & Sewerage Board v.
T.T.Murali Babu {(2014) 4 SCC 108}, Assistant Commissioner of
State Tax v. Commercial Steel Ltd. {2021 SCC OnLine SC 884},
CCE v. Dunlop India Ltd. {(1985) 1 SCC 260}, PHR Invent
Educational Society v. UCO Bank {2024 SCC OnLine SC 528}, and
an order of this Court in M/s. Skanray Technologies Ltd. v.
Chhattisgarh Medical Services Corporation Ltd. {ARBR 13/2022,
decided on 04.12.2023}.
9. In rebuttal, Ms. Saloni, learned counsel for the petitioner {in WPC No.
750/2021} placing reliance on the rejoinder filed, submits that there is no
disputed facts regarding the quality of equipment supplied or the amount
due to the petitioner and therefore, the present writ petition is
maintainable. Clause 21 of Section III of the Tender Document, titled
'Resolution of Disputes' has not been specifically incorporated in the
superseding Rate Contract that governs the relationship between the
petitioner and the respondent No. 2. General reference to another
contract (tender document in this case) will not have the effect of
incorporating arbitration clause into the superseding Rate Contract and
such arbitration clause can only be incorporated by specific reference
and not a general reference. Further, the arbitration clause in the tender
document is completely inconsistent with the dispute resolution clause in
superseding rate contract. The rate contract between the petitioner and
the respondent No. 2 refers dispute arising out of the tender exclusively
to Civil Courts in Raipur only and does not incorporate the arbitration
clause from the tender documents. The arbitration clause in the tender
document is not a valid and conclusive one. The tender documents and
the rate contract provides that the payment for the equipment supplied
by the petitioner is to be made by respondents including respondent No.
2 to 4. Further, even in contractual matters and availability of alternative
remedy is not an absolute bar for entertaining the petition and as such,
she prays that these petitions may be allowed. In support of her
contentions, she places reliance on the decisions of the Apex Court in
Unitech Limited & Others v. Telangana State Industrial
Corporation & Others {(2021) 16 SCC 35}, Surya Construction v.
State of U.P. {(2019) 16 SCC 794}, B.G.M. & M-RPL-JMCT (JV) v.
Eastern Coalfields Ltd. {2025 SCC OnLine SC 1471}, Wellington
Associates Ltd. v. Kirti Mehta {(2000) 4 SCC 272}, M.R.Engineers
& Contractors Pvt. Ltd. v. Somm Datt Builders {(2009) 7 SCC 696},
NBCC (India) Ltd. v. Zillion Infraprojects Pvt. Ltd. {2024) 7 SCC
174, M.P. Power Management Company Ltd. Jabalpur v. Sky
Power Southeast Solar India Pvt. Ltd & Others {(2023) 2 SCC 703},
Union of India v. Tantia Construction Pvt. Ltd. {(2011) 5 SCC 697}
and Ashok Kumar Sharma v. State of Rajasthan & Others {2012
SCC OnLine Raj 3132}.
10. We have heard learned counsel appearing for the petitioners as well as
the respondent/State and respondent/Corporation and have also
perused the materials available on record.
11. In nutshell, pursuant to tenders floated by the respondent-Corporation,
various tenders were floated and the petitioners were selected as L-1 in
their respective tenders and they were issued the work order / purchase
order and the petitioners duly made the supplies of medical equipments/
machines to the respondent-Corporation and the respondent-DKS
Hospital. The dispute between the parties is that the respondent-
Corporation has not made the full and final payment of the supplies
made and the services rendered by the petitioners and has been kept
pending for a long period of time. The contention of the respondent/State
as well as the respondent-Corporation is that there has been an
embezzlement of funds to the tune of Rs. 50-60 Crores (Approx) at the
DKS Hospital related to the tenders including the tenders at hand and
the then concerned officials of DKS Hospital, without due approval and
sanction, had issued requisition for tenders and as a corollary the
tenders allotted to all the parties/allottees are under scanner. The
investigating agencies in the State have also registered an FIR bearing
Crime No. 70 of 2019 registered at P.S.- Golbazar, District- Raipur and
the matter is still under investigation. Keeping in mind the entire role of
the then Medical Superintendent and Administration at DKS Hospital
with regard to the issuance of tenders without due approval and
sanction, the payments as such have not been cleared by the authorities
and have been withheld on ground of ongoing investigation, etc.
12. Another facts of the matter is that the present dispute arises out of
contractual obligations and this Court cannot ascertain as to what is the
exact amount which is required to be paid by the respondents/State or
the respondent/Corporation to the petitioners as the respondents have
not admitted the dues in clear terms. Further, clause 21 of the e-tender
for the rate contract and supply of medical equipments for DKS super
speciality centre to Chhattisgarh Medical Services Corporation Limited
provides for resolution of disputes. It provides that the purchaser and the
supplier shall make every effort to resolve amicably by direct informal
negotiation any disagreement or dispute arising between them under or
in connection with the contract. If after 30 days from the commencement
of such information negotiations, the purchaser and the supplier have
been unable to resolve amicably a contract dispute, either party may
require that the dispute be referred for resolution to the formal
mechanism. These mechanisms may include, but or not limited to,
conciliation mediated by a third party, adjudication in an agreed national
form and national arbitration and that the venue of arbitration shall be
Raipur, Chhattisgarh.
13. This Court, in a similar set of facts, has dismissed the appeal filed by the
appellant therein, in light of the decision of the Apex Court in Kerala
SEB(supra), Joshi Technologies International Inc. (supra), Director
of Agriculture v. M.V.Ramachandran {SLP(C) No. 18371/2021,
dated 17.03.2023}, M.P.Power Management Co. Ltd. v. Sky Power
Southeast Solar India (P) Ltd. {(2023) 2 SCC 703}, PHR Invent
Educational Society v. UCO Bank {2024 SCC OnLine SC 528},
Subhash Jain v. Rajeshwari Shivam {2021 SCC OnLine SC 562},
Union of India v. Puna Hinda {(2021) 10 SCC 690}.
14. In the present cases, clause 21 of the tender document provides for
resolution of disputes which the petitioners have not taken recourse to.
The petitioners have claimed outstanding dues to the tune of
Rs.5,00,33,500/- and Rs. 2,96,22,233/-, respectively per the invoices
raised by them which in the opinion of this Court, is purely a contractual
dispute and issue of recovery of money against the supply of goods
under the contract.
15. In view of the above discussion, we do not find any merit in these
petitions and they are accordingly dismissed. However, liberty is
reserved to the petitioner(s) to take recourse to the dispute resolution
mechanism, as provided under the contract/agreement, if so advised.
Sd/- Sd/-
(Ravindra Kumar Agrawal) (Ramesh Sinha)
JUDGE CHIEF JUSTICE
Manpreet / Amit
AMIT
KUMAR
DUBEY
