Telangana High Court

Md. Aziz vs State Of Telangana on 11 April, 2022

Bench: P.Madhavi Devi

      THE HONOURABLE SMT JUSTICE P.MADHAVI DEVI

           WRIT PETITION No. 2023 & 3374 OF 2022

COMMON ORDER:

     In Writ Petition No.2023 of 2022, the petitioner is

seeking a 'Writ of Mandamus' or any appropriate writ declaring

the action of   respondent No.3 in not allowing the petitioner to

proceed with the work awarded to the petitioner under the

agreement No.149/2018-19/SE/R&B/KKM dated 31.12.2018

in relation to the construction of BT road from Kaliveru to

Chennapuram from KMs 0/0 to 21/0 in Charla Mandal,

Bhadradri-Kothagudem District, though extension of time was

granted up to February, 2022 without issuing any notice and

following the procedure under Clause 24 of Part-I general

conditions of the contract as illegal and arbitrary and to

further direct the respondent No.3 not to interfere with the

work without following due process of law.

2. In writ petition No.3374 of 2022, the petitioner is seeking

a 'Writ of Mandamus' declaring the action of the respondent

No.3 in issuing a memo No.T3/TS/SEK/R&B/2021-22/2017,

dated 05.01.2022, allotting part of the work i.e., from KM 0/0

to 7/0 in Charla Mandal, Bhadradri-Kothagudem District

covered under the petitioner's agreement L.S.A.B.NO. /2018-

::2::

PMD,J W.P.NO.2023 & 3374_2022

19/SC/R&B/KMM, dated 31.12.2018, to the 5th respondent,

as illegal and arbitrary.

3. The facts of the case leading to the filing of these two writ

petitions are that the petitioner being a special class contractor

has been executing various Government works and he was

awarded the contract of construction of BT road from Kaliveru

to Chennapuram from KM 0/0 to 21/0 in Charla Mandal of

Bhadradri-Kothagudem District, vide agreement No.149/2018-

19/SE/R&B/KKM, dated 31.12.2018 being the successful

bidder.

4. The petitioner submitted that he was supposed to

complete the work by the end of February 2022, as extended

by the respondents. He submitted that the delay in execution

of work was due to local issue which was resolved only in the

month of December 2021 and he had put all his machinery

and material on the site and was continuing with the work and

the 3rd respondent on 06.01.2022 had orally directed the

petitioner to stop the work.

::3::

PMD,J W.P.NO.2023 & 3374_2022

5. According to petitioner, no notice was issued to him, and

even though clause 52 of the agreement prescribes that when

a contract is to be terminated, the petitioner has to be issued a

notice. It is the case of the petitioner that the petitioner should

be made known of the allegations against him before taking

any decision of termination of contract. He submits that no

notice was issued and the petitioner was directed to stop the

construction work.

6. Petitioner filed Writ Petition No.2023 of 2022 and during

the pendency of the same before this court, on 20.01.2022 the

petitioner has received two letters one by registered post and

the other by ordinary post and in the registered post, the

respondent No.4 has sent a letter bearing no.

AB/A2/Contractor Notice/2021-22, dated 06.01.2022, stating

that the same is being issued in continuation with the letter

reference SE/R&B/KMM/AgtNo /2021-22/SC/R&B/KM,

dated 05.01.2022 and on the perusal of the cover, the

petitioner noticed that same was dispatched from the office of

the respondents on 06.01.2022. However, the said cover was

registered only on 19.01.2022. Therefore, the contention of the

respondents that the notice was already issued to the ::4::

PMD,J W.P.NO.2023 & 3374_2022

petitioner and served on the petitioner on 06.01.2022 is

incorrect. In order to buttress the submission that the notice

dated 05.01.2022 was not issued on 06.01.2022, the petitioner

also stated that the letter received under ordinary post

contains a memo No.TS/TS/SEK/R&B/2021-22/1017,dated

05.01.2022, which has been issued by the respondent No.3,

according to which, exercising power under Clause 60 (c) of PS

to A.P.S.S., a part of the work which is stated to have been

withdrawn from the petitioner and entrusted to the respondent

No.5, and in this letter also, there was no reference at all to the

letter dated 06.01.2022 sent through registered post which

was stated to have been dispatched on 05.01.2022. Therefore,

according to him, the letter dated 05.01.2022 is an ante-dated

letter and even the letter dated 06.01.2022 posted on

19.01.2022 is only to cover up the lapses of the respondents.

7. Petitioner submits that though the respondents are

stating the delay caused in completion of contract to be the

reason for entrusting a part of the work to the respondent

No.5, and respondent No.5 was granted time upto 04.09.2022,

to complete the work, whereas the petitioner was allowed time

only upto 28.02.2022, and the petitioner, if permitted would ::5::

PMD,J W.P.NO.2023 & 3374_2022

have completed the contract within the given time. He submits

that the action of the respondents in granting part of the work

to respondent No.5 without terminating the contract with the

petitioner in accordance with the terms and conditions of the

contract is illegal, arbitrary and that it caused imparable loss

to the petitioner.

8. Petitioner placed reliance upon various documents in

support of the contentions that no notice was issued to the

petitioner prior to stopping the work of construction of road

from KM 0/0 to 7/0 in Charla Mandal, Bhadradri-Kothagudem

District.

9. Respondent No.3 has filed a counter-affidavit stating that

the petitioner was required to complete the work of

construction of the road within the extended time February,

2022. He submits that in spite of extension of time and several

notices being given by the respondents to petitioner to

commence the work vide notices dated 11.05.2021,

18.06.2021, 23.06.2021 and the final notice on 16.07.2021,

the petitioner has neither commenced the work nor replied to

the notice issued to him, and therefore the respondents had no ::6::

PMD,J W.P.NO.2023 & 3374_2022

options but to invoke clause 26 of the agreement and had to

entrust the work to the respondent No.5, by withdrawing a

part of the work under clause 60(c) of the PS to A.P.S.S. in

order to provide transportation facilities for the local people

and the police department. Respondent No.3 therefore denied

the allegations made by the petitioner that the entrustment of

the work to the respondent No.5 is without any intention of

causing loss to the petitioner.

10. The respondent No.5 has also filed counter-affidavit

stating that he is a qualified contractor to complete the work

and on entrusting of the work by the respondents to him,

respondent No.5 has commenced the work and the work is in

progress in all respects. It is submitted that the entire

machinery, which is at the site, belongs to the respondent No.5

and the work is going on with rapid speed. He therefore

supports the action of the respondent no.3 in entrusting the

work to him.

11. Learned counsel for the respondents also placed reliance

upon the various decisions to the effect that dispute between

the department and the contractor is purely a private lis and

therefore writ jurisdiction cannot be invoked to resolve such ::7::

PMD,J W.P.NO.2023 & 3374_2022

disputes. He placed particular reliance on the Judgment of the

Hon'ble Supreme Court in the State of Gujarat Vs Meghiji

Pethraj Shah Charitable Trust and Others1 and also order

in Civil Appeal No. 6086 of 2015 dated 14.08.2015, in the case

of the State of Kerala & others Vs. M.K.Jose.

12. Having regard to the rival contentions and the material

on record, it is seen that the dispute is as to whether the

respondent No.3 could have withdrawn certain part of work

from the petitioner and entrusted the same to the respondent

No.5 without following the procedure laid down in various

clauses of the agreement.

13. A Copy of the agreement between the petitioner and the

respondent No.3 is placed at pages 22 to 31 of the writ papers,

while a copy of Standard Bidding document is at pages 32 to

122 of the writ papers. Clause 24 of the Bid Document refers

to Dispute Redressal System, while clause 52 refers to

Termination of Contract. According to clause 52.1, the employer

may terminate the contract if the contractor causes

fundamental breach of the contract, and Clause (e) of 52.2

1994 LF(SC) (894), ::8::

PMD,J W.P.NO.2023 & 3374_2022

specifies that the fundamental breach of contract shall include

delay in the completion of work by the number of days for

which the maximum amount of liquated damages can be paid,

as defined in clause 44.1.

14. Admittedly, the contract which was awarded to the

petitioner was a project sanctioned by the Government of

India, under left wing extremist affected areas, under road

construction project for (RCPLWE Area), Telangana State, and

the work is to be taken up on top priority.

15. It is also not in dispute that the entire work was to be

completed by the petitioner, as per the contract by the end of

the 30.06.2020, but as the respondents could not get the

clearance, the petitioner could not complete the work and

therefore the time got extended upto 28.02.2022.

16. While the petitioner still had time to complete the work,

the official respondents have withdrawn a part of the work by

proceeding dated 06.01.2022. However, the dispute between

the Government and the petitioner appears to be not with

regard to any fulfillment of any statutory obligation by the ::9::

PMD,J W.P.NO.2023 & 3374_2022

respondents, but it is with regard to breach of conditions of

the contract.

17. The Hon'ble Supreme Court in the case of State of

Gujarat Vs. Meghiji Pethraj Shah Charitable Trust and

others cited supra has held that if a matter is governed by the

contract, the writ petition is not maintainable.

The relevant paragraph is reproduced hereunder for

ready reference i.e., paragraph 20 which reads as under:

"We are unable to see any substance in the argument that the termination of arrangement without observing the principle of natural justice (audi alteram partm) is void. The termination is not a quasi-judicial act by any stretch of imagination; hence it was not necessary to observe the principles of natural justice. It is not also an executive or administrative act to attract the duty to act fairly. It was - as has been repeatedly urged by Shri Ramaswamy - a matter governed by a contract/agreement between the parties. If the matter is governed by the contract, the writ petition is not maintainable since it is a public law remedy and is not available in private law field, e.g., where the matter is governed by a non-statutory contract. [In this connection, see Assistant Excise Commissioner & Ors. V. Isaac Peter & Ors., (1994 (2) JT 140 on the relevance of doctrine of fairness in matters governed by contract, arrived at calling ::10::

PMD,J W.P.NO.2023 & 3374_2022

for tenders, auction or by negotiations]. Be that as it may, in view of our opinion on the main question, it is not necessary to pursue this reasoning further.

18. Similar view has also been expressed in the case of State

of Kerala & Others V/s M.K.Jose, at paragraph 13 wherein,

the Hon'ble Supreme court has held as under:

"A writ court should ordinarily not entertain a writ petition, if there is a breach of contract involving disputed questions of fact. The present case clearly indicates that the factual disputes are involved. In State of Bihar v. Jain Plastics and Chemicals Ltd. 1, a two-Judge Bench reiterating the exercise of power under Article 226 of the Constitution in respect of enforcement of contractual obligations has stated:-

It is to be reiterated that writ petition under Article 226 is not the proper proceedings for adjudicating such disputes. Under the law, it was open to the respondent to approach the court of competent jurisdiction for appropriate relief for breach of contract. It is settled law that when an alternative and equally efficacious remedy is open to the litigant, he should be required to pursue that remedy and not invoke the writ jurisdiction of the High Court. Equally, the existence of alternative remedy does not affect the jurisdiction of the court to ::11::

PMD,J W.P.NO.2023 & 3374_2022

issue writ, but ordinarily that would be a good ground in refusing to exercise the discretion under Article 226.In the said case, it has been further observed:-

It is true that 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."

Further at paragraph 27, the Supreme Court has held out the

legal points emerging from the said judgment as to the

maintainability of the writ petition.

para 27 read as:

::12::

PMD,J W.P.NO.2023 & 3374_2022

(a) In an appropriate case, a writ petition as against a State

or an instrumentality of a State arising out of a contractual

obligation is maintainable.

(b) Merely because some disputed questions of fact arise for

consideration, same cannot be a ground to refuse to

entertain a writ petition in all cases as a matter or rule.

claim is also maintainable.

While laying down the principle, the Court sounds a word

of caution as under:-

"However, while entertaining an objection as to the maintainability of a writ petition under Article 226 of the Constitution of India, the court should bear in mind the fact that the power to issue prerogative writs under Article 226 of the Constitution is plenary in nature and is not limited by any other provisions of the Constitution. The High Court having regard to the facts of the case, has a discretion to entertain or not to entertain a writ petition. The Court has imposed upon itself certain restrictions in the exercise of this power. (See Whirlpool Corpn. v. Registrar of Trade Marks) And this plenary right of the High Court to issue a prerogative writ will not normally be exercised by the Court to the ::13::

PMD,J W.P.NO.2023 & 3374_2022

exclusion of other available remedies unless such action of the State or its instrumentality is arbitrary and unreasonable so as to violate the constitutional mandate of Article 14 or for other valid and legitimate reasons, for which the Court thinks it necessary to exercise the said jurisdiction".

19. In view of the above decisions of the Supreme Court, this

Court is of the opinion that both the above writ petitions are

not maintainable as the case is with regard to breach of the

contract and involves investigation into various facts, such as

whether notices were in fact issued to the petitioner before

withdrawal of part of the contract and whether the petitioner

had commenced and was carrying on the contract as per the

instructions of the respondent etc. Therefore, this Court is of

the opinion that the petitioner has to approach appropriate

Court for redressal of his grievances.

20. Thus, both the Writ Petitions are accordingly dismissed.

No order as to cost.