Dr.Amin Controllers Private Limited vs State Of Kerala
2024 Latest Caselaw 5067 Ker

Kerala High Court

Dr.Amin Controllers Private Limited vs State Of Kerala on 15 February, 2024

Author: Devan Ramachandran

Bench: Devan Ramachandran

          IN THE HIGH COURT OF KERALA AT ERNAKULAM
                           PRESENT
        THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN
 THURSDAY, THE 15TH DAY OF FEBRUARY 2024 / 26TH MAGHA, 1945
                   WP(C) NO. 9080 OF 2021
PETITIONER:

          DR.AMIN CONTROLLERS PRIVATE LIMITED
          REPRESENTED BY ITS DIRECTOR
          VIKRAM R AMIN S/O. DR. RAMANBHAI,
          56 YEARS, WITH REGISTERED OFFICE
          EMBASSY CHAMBERS, 6TH FLOOR, PLOT NO. 5,
          ROAD NO. 3, KHAR WEST, MUMBAI 400 049
          EMBASSY CHAMBERS, 6TH FLOOR, PLOT NO. 5,
          ROAD NO. 3, KHAR (WEST), MUMBAI 400 052
          BY ADVS.
          V.JOHN MANI
          ShRI.S.JAYANT
          SRI.JACKSON JOHNY
          SHRI.VARGHESE SABU
          SHRI.SETHULAKSHMI K.K.
          SMT.GAYATHRI MENON

RESPONDENTS:

    1     STATE OF KERALA
          REPRESENTED BY THE ADDITIONAL CHIEF
          SECRETARY, KERALA WATER RSOURCES, MAIN BLOCK,
          SECRETARIAT, THIRUVANANTHAPURA 690 001
    2     THE MANAGING DIRECTOR,
          KERALA WATER AUTHORITY, JALABHAVAN,
          VELLAYAMBALAM, THIRUVANANTHAPURAM 695 033
    3     THE CHIEF ENGINEER (JBIC)
          OFFICE OF CHIEF ENGINEER, JBIC
          ASSISTED KERALA WATER SUPPLY PROJECT,
          WATER WORKS CAMPUS, VELLAYAMBALAM,
          THIRUVANANTHAPURAM 695 033
    4     THE BRANCH MANAGER,
          SARASWAT CO OPERATIVE BANK LTD,
          MADHUSAGAR MARG, N S ROAD NO. 13,
          NEAR JUHU CHURCH, MUMBAI 400 049
          BY ADVS.
          SRI.P.BENJAMIN PAUL
          V.V.JOSHI
          GEORGIE JOHNY
 W.P.(C).No. 9080 of 2021
                                      :2:



       THIS      WRIT      PETITION   (CIVIL)   HAVING   COME    UP    FOR
ADMISSION       ON     15.02.2024,    THE   COURT   ON   THE    SAME   DAY
DELIVERED THE FOLLOWING:
 W.P.(C).No. 9080 of 2021
                                  :3:




                             JUDGMENT

The petitioner is conceded to be the "Third Party

Inspection Agency" qua certain works that were contracted by

the Kerala Water Authority (KWA) to different contractors, under

"Cherthala Package I" and "Cherthala Package II" - which were

essentially for laying pipelines for distribution of water under an

international collaboration. They impugn Ext.P19 proceedings of

the KWA, whereby, an amount of Rs.7,09,492/- has been found to

be their liability and they have been threatened with the

encashment of their Performance Bank Guarantee; and they

contend that this is illegal and unlawful. They thus assail

Ext.P19 as being untenable and unconstitutional.

2. Sri.John Mani - learned counsel for the petitioner,

explained the facts involved in this case saying, that his client

was entrusted with the predispatch inspection of materials, to

be used for the project; and that they have done so sincerely and

diligently. He says that, however, nearly four years after the

materials were thus supplied by the contractors, there are

alleged to be instances of burst in the pipelines; and that, in this

regard, an investigation is stated to have been done, leading to a

final conclusion against his client that they were responsible for

the afore sum, being the inspection charges disbursed to them

earlier.

3. Sri.John Mani argued that Ext.P19 is peremptorily illegal

because, it fixes two heads of liability against his client, namely,

to a sum of Rs.80,951/- qua the "Cherthala Package I" and

Rs.6,28,541/- qua the "Cherthala Package II". He argued that,

as far as the latter is concerned, it is wholly unlawful because it

has been fixed, without offering an opportunity of being heard to

his client; while, regarding the first component, it was issued

without considering any of their objections, including that,

under their contractual obligations, they were only to examine

the material on receipt at the consignee end and that too, at the

predispatch stage; and hence they cannot be held responsible

for its malfunction subsequently, on account of wrong

installation or otherwise. He argued that, as per the

agreements entered into with his client by the 'KWA', namely

Exts.P1 and P2, they were expected to only conduct third party

inspection of the pipes, which he asserted, they had done

sincerely; and that it is his client's specific case that the pipes,

after installation, had burst due to improper installation

practices and after four years of inspection. He pointed out

that, this is irrefutable because, the "GRP pipeline" is directly

buried, which is not advisable in areas like Cherthala, where the

groundwater level is high; and that the factum of his client

being not responsible for any such failure is manifest from the

fact that the aforesaid pipes are only one of the items inspected

by them and that there have been no quality deficiencies found

against any other. He thus prayed that Ext.P19 be set aside.

4. Sri.Georgie Johny - learned standing counsel for the

'KWA', in response, submitted that the allegation of the

petitioner, that they were not heard before Ext.P19 was issued is

belied from the last paragraph in its second page, wherein, it

has been clearly recorded that their replies/explanations were

considered by the High Level Committee. He then pointed out

that the liability in Ext.P19 was not fixed immediately, but only

after the Authorities obtained another quality inspection report

from CIPET - which is a premiere Government of India

Institution - whose test results show "failure". He submitted

that, therefore, this is a case where the doctrine of Res ipsa

loquitur would apply; and that the petitioner, by the very factum

of the test results from CIPET being as afore, would have to be

held responsible even for the burst of the pipeline, but which

has been spared to them, by confining their liability only to the

extent of the inspection charges paid to them - which he argued

was not eligible to them on account of their failure specifically

mentioned in Ext.P19. He thus prayed that this writ petition be

dismissed.

5. Before I go on with the evaluation of the rival

submissions, I must place on record one pertinent development.

6. The petitioner concededly had furnished a bank

guarantee to the KWA and noticing the same, a learned Judge of

this Court had, on 09.04.2021, issued an order to the fourth

respondent, not to encash the same, provided they renew it

within a particular period from then. It is now brought to my

notice by Sri.Georgy Johny - learned standing counsel for the

'KWA', that the bank guarantee was renewed by the petitioner

only for a short while thereafter, until 30.09.2022; and that it

has not been renewed thereafter.

7. I must say that the actions of the petitioner, in refusing

to extend the bank guarantee, after obtaining an interim order

as afore, is rather unfortunate because, this amounts to an

attempt to circumvent legal processes. If they had a case that

they had renewed the bank guarantee until 30.09.2022 and that

there were no orders to extend it further, propriety demands

that pending litigation, they ought to have approached this

Court and sought further clarification, particularly when they

enjoyed an interim order, which was granted by this Court solely

under the impression that the bank guarantee would be kept

alive. The consequence is that the said order now stands

frustrated because, the bank guarantee has not been renewed;

and obviously, therefore, the petitioner cannot be granted any

benefit, if they continue with such a conduct.

8. That being said, when I examine Ext.P19, I must say that

I find force with some of the submissions made on their behalf

by their learned counsel - Sri.John Mani.

9. This is because, even though the said order says that

replies and explanations of the petitioner were placed before the

High Level Committee, there is absolutely nothing in it, as to

how it was dealt with and what were the observations of that

Committee, or the decisions that were taken thereafter.

10. As argued by Sri.Georgie Johny, the 'KWA' appears to

have been swayed by the factum of CIPET having issued a

"failure" report. But the specific contention of the petitioner -

that the "GRP pipes" are only one of the components certified by

them, with the others having been found to be without defect;

and further that it was the installation of the pipes which has

created the burst - does not appear to have been adverted to,

much less considered. To add to this, their singular imputation,

that the "GRP pipeline" ought not to have been buried in areas

like Cherthala, where the groundwater level is high, has also not

been examined or answered.

11. Apart from the afore, as regards the fixing of liability of

Rs.6,28,541/-, the petitioner asserts that they were never heard

and this is a specific averment in this writ petition also.

According to them, the other component of Rs.80,951/- has also

been imposed upon them illegally because, they were

responsible only for the predispatch inspection, until the

consignee end, but not after it has been put to use for the laying

of the pipelines.

12. As long as the afore issues remain unanswered in

Ext.P19, I cannot find favour with it.

13. I have, therefore, no doubt that the claims of the

petitioner will certainly have to be reconsidered by the

competent Authority, after giving them an opportunity of being

heard and of preferring their version; and that this is imperative

to ensure fairness in procedure.

14. However, as I have already said above, the conduct of

the petitioner, in not renewing the bank guarantee stands

against them; and hence, any relief can be granted by this Court

only if they agree to do so. I, therefore, put it to Sri.John Mani

V. - learned counsel for the petitioner, whether his client will

renew the bank guarantee, to which, his reply was to the

affirmative; and undertook that, until such time as the exercise

to be ordered by this Court is completed, the same will be kept

alive.

15. In the afore circumstances, I order this writ petition

with the following directions:

(a) The impugned Ext.P19 will stand set aside, qua

the petitioner .

(b) The competent Authority of the 'KWA' will

reconsider the claims of the petitioner, after affording

them an opportunity of being heard, and of preferring

an explanation / objection to the action proposed

against them; thus culminating in an appropriate

fresh order, as expeditiously as is possible, but not

later than four months from the date of receipt of a

copy of this judgment

(c) I, however, make it clear that the afore directions

will inure to the benefit of the petitioner, only if they

renew the bank guarantee for a minimum period of

one year, and furnish the same before the 'KWA',

within a period of one week from the date of receipt

of a copy of this judgment. If they fail to do so, the

directions in this judgment will stand vacated, and the

'KWA' will be at full liberty to recover the amounts

quantified under Ext.P19 from them, without any

further orders having to be obtained from this Court.

This writ petition is thus ordered.

Sd/-

DEVAN RAMACHANDRAN JUDGE stu/anm

APPENDIX OF WP(C) 9080/2021

PETITIONER EXHIBITS EXHIBIT P1 A TRUE COPY OF WORK ORDER NO. KWA /JBIC/HQ/W-1620/04 DATED 9/2/2007 IN THE NAME OF ITENG ENGINEERING EXHIBIT P2 A TRUE COPY OF AGREEMENT EXECUTED BY THE 3RD RESPONDENT AND PETITIONER DATED 20-02-2007 EXHIBIT P3 A TRUE COPY OF SUPPLEMENTAL AGREEMENT EXECUTED BY 3RD RESPONDENT AND PETITIONER IN THE MONTH OF AUGUST 2007 EXHIBIT P4 A TRUE COPY OF INSPECTION REPORT ISSUED BY ITENG ENGINEERING AS REPORT NO KWA GRAPHITE BA-01 DATED 11-10-2008 EXHIBIT P4(a) TRUE COPY OF INSPECTION REPORT ISSUED BY ITENG ENGINEERING AS REPORT NO. KWA GRAPHITE BA-02 DATED 21-10-2008 EXHIBIT P4(b) TRUE COPY OF INSPECTION REPORT ISSUED BY THE ITENG ENGINEERING AS REPORT NO.

KWA GRAPHITE BA-03 DATED 21-10-2008 EXHIBIT P4(c) TRUE COPY OF INSPECTION REPORT ISSUED BY ITENG ENGINEERING AS REPORT NO. KWA GRAPHITE BA-04 DATED 21-10-2008 EXHIBIT P5 TRUE COPY OF LETTER ISSUED BY DEPUTTY CHIEF ENGINEER, KERALA WATER AUTHORITY, DATED 20-01-2009 EXHIBIT P6 A TRUE COPY OF LETTER ISSUED BY 3RD RESPONDENT DATED 23-04-2010 EXHIBIT P7 TRUE COPY OF LETTER ISSUED BY TECC TO PETITIONER VIDE LETTER NO TEC/SKK/30/39/12/661 DATED 6-10-2012 EXHIBIT P8 THE TRUE COPY OF REPLY SUBMITTED BY PETITIONER TO TEC VIDE LETTER NO.

IEC/TEC/2012/444 ON 11-10-2012 EXHIBIT P9 A TRUE COPY OF LETTER ISSUED BY 2ND RESPONDENT ISSUED A LETTER VIDE NO.

KWA/JICA/CE/W-3118/12 DATED 28-02-2014 TO VICE PRESIDENT M/S. ITENG ENGINEERING.

EXHIBIT P10 A TRUE COPY OF REPLY SUBMITTED BY PETITIONER TO 2ND RESPONDENT AGAINST THE EXHIBIT P9 LETTER VIDE LETTER NO DACPL/KWA-JBIC/176/2014 DATED 10-03-

EXHIBIT P11 TRUE COPY OF LETTER NO WS-

B1/145/2016/WRD ISSUED BY 1ST RESPONDENT TO 2ND RESPONDENT DATED 17- 05-2019 EXHIBIT P12 A TRUE COPY PROCEEDINGS NO.

KWA/JICA/CE/W-3118/12 DATED 25-11-2019 EXHIBIT P13 A TRUE COPY OF LETTER ISSUED BY PETITIONER TO 2ND RESPONDENT ON 19-12- 2019 VIDE LETTER DACPL/KWA/2019-20/680 EXHIBIT P13(a) AN EXTRACT OF TENDER CONDITION CLAUSE 1 TO 13 OF WORK ORDER NO.

KWA/JBIC/HQ/W-1620/04 DATED 9-2-2007 EXHIBIT P14 TRUE COPY OF LETTER ISSUED BY 3RD RESPONDENT AS NO. KWA/JICA/E5- 1448/2015 DATED 29-05-2020 TO BRANCH MANAGER, SARASWAT COOPERATIVE BANK LTD MUMBAI.

EXHIBIT P15 A TRUE COPY OF PETITION TO ACCEPT ADDITIONAL DOCUMENTS ALONG WITH DOCUMENTS FILED AS I.A NO. 1 OF 2020 IN W.P(C) NO. 13408 OF 2020 EXHIBIT P16 A TRUE COPY OF JUDGMENT IN W.P(C) NO.

13408 OF 2020 DATED 06-10-2020 OF THIS HON'BLE COURT EXHIBIT P17 A TRUE COPY OF LETTER ISSUED BY 3RD RESPONDENT AS KWA/JICA/E5-1448/2015(1) DATED 25-02-2021 EXHIBIT P18 A TRUE COPY OF REPLY SUBMITTED BY THE PETITIONER TO EXHIBIT P17 LETTER DATED 10-03-2021 EXHIBIT P19 A TRUE COPY OF PROCEEDINGS OF 2ND RESPONDENT AS NO. KWA/JICA/CE/W-

3118/AMIN-CTRLS/2020 DATED 15-03-2021 EXHIBIT P20 A TRUE COPY OF LETTER NO.

KWA/JICA/CE/W-3118/AMIN CTRLS/2020 DATED 17-03-2021 ISSUED BY 2ND RESPONDENT.

RESPONDENTS' EXHIBITS Exhibit R2(a) TRUE COPY OF THE TEST RESULTS CONDUCTED ON 26.3.2013 AT THE CENTRAL INSTITUTE OF PLASTICS ENGINEERING AND TECHNOLOGY(CIPET), HYDERABAD, A CENTRAL GOVERNMENT OTGANIZATION Exhibit R2(b) TRUE COPY OF THE MINUTES, IN THE MEETING CONDUCTED BY THE HON'BLE MINISTER FOR WATER RESOURCES ON 10.12.2014, IT HAD BEEN DIRECTED TO

REPLACE THE FRP PIPES IN PACKAGE II CHERTHALA SCHEME Exhibit R2(c) TRUE COPY OF THE TEST RESULTS DATED 15.11.2016 CONDUCTED THROUGH M/S. CIPET, HYDERABAD Exhibit R3(a) TRUE COPY OF THE LETTER DATED 8/8/2022 GIVEN TO THE 4TH RESPONDENT IN WP(C) Exhibit R3(b) TRUE COPY OF THE LETTER DATED 8/8/2022, TO THE PETITIONER BY THIS RESPONDENT IN WP(C) Exhibit R3(c) TRUE COY OF THE LETTER DATED 4/10/2022,FROM PETITIONER TO THIS RESPONDENT IN WP(C)