Orissa High Court
M/S. Sainik Mining And vs Mahanadi Coalfields Ltd.& on 3 November, 2021
IN THE HIGH COURT OF ORISSA AT CUTTACK
W.P.(C) No.1572 of 2017
(Through Hybrid Mode)
M/S. Sainik Mining and ..... Petitioner
Allied Services Ltd.
Mr. Avijit Patnaik, Advocate
Vs.
Mahanadi Coalfields Ltd.& ..... Opposite Parties
Ors. Mr. Saktidhar Dash,
Senior Advocate
CORAM: JUSTICE ARINDAM SINHA
ORDER
03.11.2021
Order No.
03.
1. Mr. Patnaik, learned advocate appears on behalf of
petitioner, who executed work under contract for Mahanadi
Coalfields Limited. He submits, under challenge is
communication dated 30th July, 2016, whereby under loading
charge has been made. According to him it is a penalty. No
opportunity of hearing was granted in issuing this demand,
purportedly in terms and conditions as per clause-25.01 of
the contract. He refers to clause-25.01, reproduced below :-
" All Pay loaders which are engaged for
mechanical loading of coal into wagons are to be
fitted with "True load" system to measure the
quantity of coal loaded into particular wagon
which are forming part of the rake."
2. On query from Court he submits, there is no penalty
// 2 //
clause in relation to clause-25.01, in the terms and
conditions. Furthermore his client by letter dated 1st January,
2017 addressed to the Regional Transport Authority (RTO),
had requested permission for installation of true load system
in the pay loaders engaged for mechanical transfer of coal.
The office replied by letter dated 3rd January, 2017.
According to him, permission was denied. Contents of said
letter dated 3rd January, 2017 are reproduced below :-
" In inviting reference to the subject
cited above, I am intimating you that fitting of
True Load system to measure the quantity of
coal in terms of tonnage by the loader only can
be assessed by the carrying capacity of the
bucket in terms of cubic meter. True load only
can be determine converting cubic meter to
tonnage in respect of different minerals.
Therefore alternation/fitment of instrument of
any type (True Load system etc.) is not
authorized/approved system.
This is for your information and necessary
action."
He submits, there should be interference. Not only is the
contract silent on imposition of penalty but also the transport
authority did not allow installation of true load system.
3. Mr. Das, learned senior advocate appears on behalf of
MCL and draws attention to, inter alia, clause-13 in the
Special Terms and Conditions, which provides for the
company to recover loss on account of, amongst others,
equipments of contractor, value of such loss as assessed by
the company to be recovered from the contractors
// 3 //
bill/security deposits. He also refers to clause-12 in the
General Terms and Conditions to submit, it was incumbent
upon petitioner to seek settlement of disputes in terms
thereon. He relies on judgment of the Supreme Court in
Mahanadi Coalfields Ltd. V. Dhansar Engg. Co. (P) Ltd.
reported in (2016) 10 Supreme Court Cases 571,
paragraph-23, wherefrom following passage is extracted and
reproduced below :-
"23. ..... It is a different matter that the
respondents were not put to notice before the final
decision was taken by the appellants to recover the
financial loss along with penalty. The respondents
could have approached the appellants for
reconsideration of their demand towards penalty,
in terms of Clause 30.3 of the contract; and
persuade the appellants to waive the penalty
amount to be recovered from them. The
respondents, however, chose to straightaway
approach the High Court by way of writ petition.
Notably, the High Court has not set aside the
penalty amount as such, but the entire demand
being impressible."
4. Going by what was said in Mahanadi Coalfields
Limited (supra) there appears to be some similarity between
this case and the case decided. Opposite parties took the
decision without reference to petitioner. It is not necessary to
adjudicate whether or not such could be done under authority
of clause-13 in the Special Terms and Conditions, relied
upon by Mr. Dash. What is important is that clause-12 of the
General Conditions of Contract provide for a mechanism for
// 4 //
settlement of dispute.
5. It is clear that petitioner disputes the demand of under
loading charges. It must seek redressal in terms of provisions
in clause-12 of the general conditions.
6. It appears from order-sheet, by order dated 21st
February, 2017 interim measure was directed restraining
effect being given to the penalty imposed on petitioner. That
direction is extended to continue for six weeks from date, for
petitioner to approach for settlement of the dispute.
7. The writ petition is disposed of.
(Arindam Sinha)
Judge
Prasant
