Premier Explosives Ltd vs The Chariman M.D., Singareni ...
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 THE HON'BLE THE CHIEF JUSTICE SATISH CHANDRA SHARMA
                                           AND
      THE HON'BLE SRI JUSTICE ABHINAND KUMAR SHAVILI

                      WRIT APPEAL No.431 OF 2010

JUDGMENT: (Per the Hon'ble the Chief Justice Satish Chandra Sharma)

        The present writ appeal is arising out of the order dated

24.12.2009

passed by the learned Single Judge in W.P.No.3885

of 2008.

The undisputed facts of the case reveal that the

appellant/writ petitioner, a company manufacturing explosives,

was supplying explosives and accessories to Singareni Collieries

Company Limited (SCCL). Pursuant to a tender dated

14.12.2006, the appellant/writ petitioner submitted its bid for

supply of SMS explosives and accessories to its MNC Open

Cast-II project for a period of one year. A Letter Of Intent was

issued on 09.04.2007 and thereafter, supply was made from

time to time. However, dispute arose between the parties. On

12.01.2008, orders were passed by the SCCL terminating the

contract, by forfeiting the bank guarantee and duly imposing

risk purchase and other penalties as per the terms of the

purchase order. Before the learned Single Judge, arguments

were canvassed by both the sides and there were serious

disputed questions of facts. The learned Single Judge has

dismissed the writ petition and a liberty was granted to the

parties to work out their respective remedies.

The agreement executed between the parties is on

recorded and Clauses S, U and W are reproduced as under:-

"S. SCCL reserves the right to fore close the contract any time during execution if the performance of products supplied by successful tenderer or their opted firm are not satisfactory. SCCL is the sole judge in this regard. In such case the performance bank guarantee shall be forfeited and their vendor performance shall be recorded for future enquiries.

U. Notwithstanding any thing mentioned above/herein, the Company (SCCL) reserves the right t terminate the contract, with immediate effect without assigning any reasons, if the Company (SCCL) is of the opinion that the contract is not being conducted/ carried out to it's satisfaction and the Company (SCCL) will be the sole judge in this regard. Due to imposition of any Law / change in Law by Government Court decision, if the contract is to be stopped, the contract will be terminated.

W. SETTLEMENT OF DISPUTES:

Any dispute or difference of opinion arising between the SCCL or its authorised representative and the contractor in respect of site plans, specifications, measurements, manner of execution or any thing connected with the work, not specially provided for, here in under the specification or in respect of meaning of any clause of the terms and conditions of Tender document shall be decided by 'CIVIL COURT' of competent jurisdiction and not by arbitration."

The aforesaid Clauses under the agreement make it very

clear that SCCL was having a right to terminate the contract

with immediate effect without assigning any reasons and a

remedy is also provided to resolve the dispute exclusively by

approaching the Civil Court of competent jurisdiction and not

by arbitration. Therefore, this Court does not find any reason to

interfere with the order passed by the learned single Judge.

Resultantly, the writ appeal stands dismissed. The

appellant/writ petitioner is granted liberty to pursue the

alternative remedy.

Pending miscellaneous applications, if any, shall stand

closed. There shall be no order as to costs.

________________________ SATISH CHANDRA SHARMA, CJ

_______________________ ABHINAND KUMAR SHAVILI, J

21.03.2022 JSU