M/S. Crrcipplgvriipljv vs The Chairman And Managing Director ...
2025 Latest Caselaw 4062 Tel

Telangana High Court

M/S. Crrcipplgvriipljv vs The Chairman And Managing Director ... on 19 June, 2025

          THE HON'BLE SRI JUSTICE PULLA KARTHIK

                  WRIT PETITION No.22127 of 2024
ORDER:

This Writ Petition, under Article 226 of the Constitution of India,

is filed seeking the following relief:

"...to issue writ or order more particularly one in the nature of mandamus, declaring clause 1.4 (b) of Work Order No. 7600009302 dated 14-11-2022, issued by respondent no. 2, in favour of petitioner is illegal, against public policy and in violation of Section 23 of Indian Contract and quash the said clause on such terms and conditions as this court deems fit and may pass..."

2. Heard Sri L. Harish, learned counsel for the petitioner and

Sri E. Madan Mohan Rao, learned Senior Counsel, representing

Sri P. Sri Harsha Reddy, learned Standing Counsel for the respondents.

3. Learned counsel for the petitioner submitted that the petitioner,

being a joint-venture, obtained a work order from respondent No.2 vide

order No.7600009305 dated 14.11.2022, for drilling, excavation,

loading, transportation, dumping, spreading, leveling, etc. of 722.176

LBCM of IN-SITU overburden (which includes 3.982 LBCM of top soil,

7.715 LBCM of B.C. soil, 692.993 LBCM of hard OB and 17.486 LBCM

of coal) with conventional equipment and additional works, viz., 1500

shovel hours, 500 dozer hours and 75,000 RMT drilling at Srirampur

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Open Cast-I and II integrated project Srirampur area for a period of

forty-eight months (four years), commencing from 30.11.2022.

Accordingly, as per the work order, the respondent Company shall

supply diesel for running vehicles and machinery, and as per Clause

1.4(b) of work order, a fixed rate of Rs.143.26 per liter, as on

08.11.2022, was quoted for diesel, and it was also quoted that the diesel

price during the contract period will remain the same irrespective of an

increase or decrease in the diesel price. It was further submitted that

the diesel price in the country has fluctuated and it has come down to

Rs.96/- and the respondents, by taking undue advantage of Clause

1.4(b), are deducting the cost of diesel supplied from the bill raised by

the petitioner at Rs.143.29 per liter. Accordingly, the differential

amount calculated from September, 2023 to May, 2024 is about

Rs.3,80,82,418.96.

4. Learned counsel contended that petroleum or petroleum products,

which are essential commodities, are covered by the Essential

Commodities Act, 1955. Therefore, the respondent Company cannot

perform the business of purchasing diesel from the oil companies as per

the prevailing market value and supply it to the petitioner at a higher

price, i.e., Rs.143.26 per liter. Further, as per Section 3(2)(c) of the

Essential Commodities Act, 1955, the Central Government is

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empowered to control the price at which any essential commodity may

be bought or sold. Therefore, Clause 1.4(b) of the work order

No.7600009302 dated 14.11.2022 issued in favour of the petitioner by

respondent No.2, is unlawful, forbidden by law, and is hit by Section 23

of the Indian Contract Act, 1872, and the said clause is against public

policy. Therefore, learned counsel for the petitioner prayed this Court to

pass appropriate orders by setting aside Clause 1.4(b) of the Work Order

No.7600009302 dated 14.11.2022. Reliance has been placed on the

decisions of the Hon'ble Apex Court in ABL International Ltd. and

another v. Export Credit Guarantee Corporation of India Ltd. and

others 1 and Gas Authority of India Limited v. Indian

Petrochemicals Corporation Limited and others 2.

5. On the other hand, learned Senior Counsel appearing for the

respondents submitted that the petitioner firm stood as L1 in the open

market bidding enquiry No.E11220O137 dated 11.07.2022, for drilling,

excavation, loading, transportation, dumping, spreading, leveling, etc.

Therefore, a contract, vide work order No.7600009302 dated

14.11.2022, was awarded to the petitioner firm after completion of the

tender process, and the work commenced from 30.11.2022. Further, as

per Clause 1.1.1(e) of the Notice Inviting Tender (NIT), "SCCL will

1 (2004) 3 SCC 553 2 (2023) 3 SCC 629

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indicate estimated quantity of diesel of 0.581 LB/BCM for excavation of

Insitu OB and diesel price is fixed at Rs.143.26 per ltr as on

date:08.07.2022". As per Clause 1.4(b) of the NIT, "for monthly excess

consumption, the amount for excess quantity of diesel will be recovered at

a fixed price as provided in the NIT (i.e. Rs.143.26 per ltr as on date

08.07.2022) irrespective of increase/decrease of diesel price during the

contract period and the same amount will be withheld from monthly bills".

6. It was further submitted that five firms participated in the open

enquiry and quoted the excavation rate, wherein, the petitioner firm

quoted the bid after thorough verification of the NIT and stood as L1

bidder. The diesel price fixed at Rs.143.29 per liter was the current rate

in the market as on the date of NIT published, i.e., 08.07.2022, and this

rate will be applicable for the entire contract period of four years

irrespective of an increase or a decrease in the diesel price. As such, the

petitioner is stopped from revising the issue after long period of

commencement of contract and the terms of contract find the

particulars unless mutually agreed and modified by supplementary

agreement in writing. It was further submitted that the respondent

Company is deducing the diesel prices at Rs.143.26 per liter as per

Clauses 1.1.1(e) and 1.4(b) of NIT/work order, for excess consumption

than the awarded diesel eligibility only.

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7. It was further submitted that the respondent Company is not

undertaking any business with diesel supply and the Company is

supplying the diesel to the offloading firm as per the eligibility for the

excavated quantity of OB, according to the norms specified in the NIT

and work order. Further, the cost of diesel is only being recovered at the

specified rate for the excess quantity of diesel consumed only and the

cost of diesel is not being recovered if the firm consumes diesel within

the specified limit as per the cubic meter of OB removed. It was also

submitted that the respondent Company is not selling diesel to any firm

but is only recovering the cost of diesel for excess consumption with

respect to the OB removal as per the NIT/work order, for which, the firm

had also agreed while submitting its tender, and after issue of a letter of

intent, it entered into an agreement with the respondent company.

8. It was further submitted that Clause 1.14 of the work order dated

14.11.2022 provides for dispute resolution. According to this Clause,

the petitioner firm has to first approach the Mine Management

Committee for settlement of disputes, and if the dispute is not resolved,

the firm is supposed to approach the Civil Court for redressal of its

grievance. However, without first availing either of the said remedies,

the petitioner firm has approached this Court. Hence, the present writ

petition is not maintainable as the same arises out of a contractual

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obligation. Therefore, it was prayed to dismiss the present writ petition.

Reliance has been placed on the following decisions of the Hon'ble Apex

Court:

i. Orissa State Financial Corporation v. Narsingh Ch. Nayak and others 3,

ii. Numaligarh Refinery Ltd. v. Daelim Industrial Co. Ltd. 4,

iii. Rajasthan State Industrial Development and Investment Corporation and another v. Diamond & Gem Development Corporation Limited and another 5,

iv. Joshi Technologies International INC. v. Union of India and others 6,

v. Bharat Coking Coal Limited and others v. AMR Dev Prabha and others 7,

vi. Union of India and others v. N. Murugesan and others 8,

vii. Judgment of a Division Bench of this Court in W.A.No.651 of 2022 dated 13.10.2022,

viii. Order of this Court in W.P.No.30770 of 2022 dated 13.09.2022.

9. This Court has taken note of the rival submissions made by the

learned counsel for the respective parties and perused the material

available on record.

3 (2003) 10 SCC 261 4 (2007) 8 SCC 466 5 (2013) 5 SCC 470 6 (2015) 7 SCC 728 7 (2020) 16 SCC 759 8 (2022) 2 SCC 25

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10. Admittedly, the respondent Company published a Notice Inviting

Tender No.E11220O137 dated 11.07.2022, for the purpose of drilling,

excavation, loading, transportation, dumping, spreading, leveling, etc. at

Srirampur Open Cast-I and II projects, for a period of four years. In

response, as many as five firms participated in the tender process, and

the petitioner, a joint-venture entity, was declared as L1 bidder and was

awarded the contract vide Work Order No.7600009302 dated

14.11.2022. The work, admittedly, commenced from 30.11.2022.

11. The dispute in the present writ petition revolves around the

validity of Clause 1.4(b) of Work Order No.7600009302 dated

14.11.2022, which stipulates that the price of diesel shall be fixed at

Rs.143.26 per liter as on 08.11.2022, for the excess quantity of diesel

consumed, irrespective of any fluctuation in the market rate. The said

clause reads as under:

"1.4 SUPPLY OF DIESEL:

b. For monthly excess consumption, the amount for excess quantity of diesel will be recovered at a fixed price as provided in the order (i.e., Rs.143.23 per Liter as on date on 8.07.2022) irrespective of increase/ decrease of diesel price during the contract period and the same amount will be withheld from monthly bills."

12. It is also relevant to refer to Clause 1.1.1 (e) of the Work Order

dated 14.11.2022, wherein, the respondent Company has categorically

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provided the quantity of diesel to be supplied to the petitioner for

undertaking the contracted work. The said Clause is extracted

hereunder:

"1. TECHNICAL TERMS AND CONDITIONS:

1.1 SCOPE OF WORK AND WORK COMPLETION SCHEDULE

e. SCCL will provide awarded quantity of diesel of 0.581 Lts/BCM for excavation of in-situ OB. The diesel price is Rs.143.26 per Ltr as on date of 8.07.2022."

13. As per Clause 1.4(b), the respondent Company is bound to recover

the amount from the monthly bills of the petitioner only for the

consumption of diesel, over and above the awarded quantity, at

Rs.143.23 per liter, which was the price prevailing in the market as on

08.07.2022. The said clause was also incorporated in the Notice

Inviting Tender dated 11.07.2022. Thus, the petitioner and the other

bidders had the option either to accept or reject the tender terms. The

petitioner has voluntarily participated in the tender process, submitted

its bid, and after being declared as L1 bidder, entered into the contract

with the respondent Company, where, Clause 1.4 was incorporated

without any objections. As per the work order, the work commenced

from 30.11.2022, and the petitioner performed the works, submitted its

bills, and accepted the payments. However, at no point of time, the

petitioner appears to have disputed the terms of contract, and now, only

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after almost eighteen month of executing the contract, the present writ

petition has been filed, contending that the said clause is contrary to

public policy and the Essential Commodities Act, 1955. Having chosen

to voluntarily bid, succeed, and execute the contracted work, the

petitioner cannot now object the said Clause. The principle of approbate

and reprobate squarely applies to the instant case.

14. The Hon'ble Apex Court, in Rajasthan State Industrial

Development and Investment Corporation (supra), particularly

addressed the interpretation of contractual terms, the doctrine of

estoppel, and the limits of judicial intervention in contractual matters.

The relevant observations are extracted hereunder: (approbate

reprobate)

"I. Approbate and reprobate

15. A party cannot be permitted to "blow hot-blow cold", "fast and loose" or "approbate and reprobate". Where one knowingly accepts the benefits of a contract, or conveyance, or of an order, he is estopped from denying the validity of, or the binding effect of such contract, or conveyance, or order upon himself. This rule is applied to ensure equity, however, it must not be applied in such a manner so as to violate the principles of what is right and of good conscience. [Vide Nagubai Ammal v. B. Shama Rao [AIR 1956 SC 593] , CIT v. V. MR. P. Firm Muar [AIR 1965 SC 1216] , Ramesh Chandra Sankla v. Vikram Cement [(2008) 14 SCC 58 : (2009) 1 SCC (L&S) 706 : AIR 2009 SC 713] , Pradeep Oil Corpn. v. MCD [(2011) 5 SCC 270 : (2011) 2 SCC (Civ) 712 : AIR 2011 SC 1869] , Cauvery Coffee Traders v. Hornor Resources (International) Co. Ltd. [(2011) 10 SCC 420 : (2012) 3 SCC (Civ) 685] and V. Chandrasekaran v.

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Administrative Officer [(2012) 12 SCC 133 : (2013) 2 SCC (Civ) 136 : JT (2012) 9 SC 260] .]

III. Contractual disputes and Writ Jurisdiction

19. There can be no dispute to the settled legal proposition that matters/disputes relating to contract cannot be agitated nor terms of the contract can be enforced through writ jurisdiction under Article 226 of the Constitution. Thus, the writ court cannot be a forum to seek any relief based on terms and conditions incorporated in the agreement by the parties. [Vide Bareilly Development Authority v. Ajai Pal Singh [(1989) 2 SCC 116 : AIR 1989 SC 1076] and State of U.P. v. Bridge & Roof Co. (India) Ltd. [(1996) 6 SCC 22 : AIR 1996 SC 3515] ]

20. In Kerala SEB v. Kurien E. Kalathil [(2000) 6 SCC 293 : AIR 2000 SC 2573] this Court held that a writ cannot lie to resolve a disputed question of fact, particularly to interpret the disputed terms of a contract observing as under : (SCC pp. 298-99, paras 10-11)

"10. ... The interpretation and implementation of a clause in a contract cannot be the subject-matter of a writ petition. ... If a term of a contract is violated, ordinarily the remedy is not the writ petition under Article 226. We are also unable to agree with the observations of the High Court that the contractor was seeking enforcement of a statutory contract. ....

11. ... The contract between the parties is in the realm of private law. It is not a statutory contract. The disputes relating to interpretation of the terms and conditions of such a contract could not have been agitated in a petition under Article 226 of the Constitution of India. That is a matter for adjudication by a civil court or in arbitration if provided for in the contract. ... The contractor should have relegated to other remedies."

IV. Interpretation of the terms of contract

23. A party cannot claim anything more than what is covered by the terms of contract, for the reason that contract is a transaction between the two parties and has been entered into with open eyes and understanding the nature of contract. Thus, contract being a creature of an agreement between two or more parties, has to be interpreted giving literal meanings

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unless, there is some ambiguity therein. The contract is to be interpreted giving the actual meaning to the words contained in the contract and it is not permissible for the court to make a new contract, however reasonable, if the parties have not made it themselves. It is to be interpreted in such a way that its terms may not be varied. The contract has to be interpreted without any outside aid. The terms of the contract have to be construed strictly without altering the nature of the contract, as it may affect the interest of either of the parties adversely. [Vide United India Insurance Co. Ltd. v. Harchand Rai Chandan Lal [(2004) 8 SCC 644 : AIR 2004 SC 4794] and Polymat India (P) Ltd. v. National Insurance Co. Ltd. [(2005) 9 SCC 174 : AIR 2005 SC 286] ]"

15. In N. Murugesan (supra), the Hon'ble Apex Court categorically

emphasized that an individual cannot selectively accept benefits from a

decision for a significant period and then challenge its terms when it no

longer suits them. Essentially, a party is prevented from approbating

and reprobating, by accepting an advantageous part of a transaction

while simultaneously rejecting a disadvantageous part.

16. Further, the instant case arises out of a contract and

interpretation of its clauses. This Court and the Hon'ble Apex Court

have been consistently holding that a writ petition under Article 226 of

the Constitution of India is not maintainable and the interpretation and

implementation of clauses of a contract cannot be the subject matter of

a writ petition.

17. In this context, it is relevant to refer to the decision of the Hon'ble

Apex Court in Joshi Technologies International INC. (supra),

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wherein, it was categorically held that the jurisdiction of this Court

under Article 226 of the Constitution of India cannot ordinarily be

invoked to enforce purely private contractual rights against the State or

its instrumentalities. It was also held that intervention in a contractual

dispute is justified if the contract involves a public law element, such as

violation of a fundamental right or clear arbitrariness, beyond a mere

breach of contract. The relevant portion of the said decision is extracted

hereunder:

"68. The Court thereafter summarised the legal position in the following manner : (ABL International Ltd. case [(2004) 3 SCC 553] , SCC pp. 572, paras 27-28)

"27. From the above discussion of ours, following legal principles emerge as to the maintainability of a writ petition:

(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 facts arise for consideration, same cannot be a ground to refuse to entertain a writ petition in all cases as a matter of rule.

(c) A writ petition involving a consequential relief of monetary claim is also maintainable.

28. 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 [(1998) 8 SCC 1] .) And this plenary right of the High Court to issue a prerogative

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writ will not normally be exercised by the Court to the 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."

69. The position thus summarised in the aforesaid principles has to be understood in the context of discussion that preceded which we have pointed out above. As per this, no doubt, there is no absolute bar to the maintainability of the writ petition even in contractual matters or where there are disputed questions of fact or even when monetary claim is raised. At the same time, discretion lies with the High Court which under certain circumstances, it can refuse to exercise. It also follows that under the following circumstances, "normally", the Court would not exercise such a discretion:

69.1. The Court may not examine the issue unless the action has some public law character attached to it.

69.2. Whenever a particular mode of settlement of dispute is provided in the contract, the High Court would refuse to exercise its discretion under Article 226 of the Constitution and relegate the party to the said mode of settlement, particularly when settlement of disputes is to be resorted to through the means of arbitration.

69.3. If there are very serious disputed questions of fact which are of complex nature and require oral evidence for their determination.

69.4. Money claims per se particularly arising out of contractual obligations are normally not to be entertained except in exceptional circumstances.

...

70.4. Writ jurisdiction of the High Court under Article 226 of the Constitution was not intended to facilitate avoidance of obligation voluntarily incurred.

70.5. Writ petition was not maintainable to avoid contractual obligation. Occurrence of commercial difficulty, inconvenience or hardship in performance of the conditions agreed to in the contract can provide no justification in not complying with the terms of contract which the parties had accepted with open eyes. It cannot ever be that a licensee can work out the licence

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if he finds it profitable to do so : and he can challenge the conditions under which he agreed to take the licence, if he finds it commercially inexpedient to conduct his business.

70.6. Ordinarily, where a breach of contract is complained of, the party complaining of such breach may sue for specific performance of the contract, if contract is capable of being specifically performed. Otherwise, the party may sue for damages.

...

70.8. If the contract between private party and the State/instrumentality and/or agency of the State is under the realm of a private law and there is no element of public law, the normal course for the aggrieved party, is to invoke the remedies provided under ordinary civil law rather than approaching the High Court under Article 226 of the Constitution of India and invoking its extraordinary jurisdiction.

70.9. The distinction between public law and private law element in the contract with the State is getting blurred. However, it has not been totally obliterated and where the matter falls purely in private field of contract, this Court has maintained the position that writ petition is not maintainable. The dichotomy between public law and private law rights and remedies would depend on the factual matrix of each case and the distinction between the public law remedies and private law field, cannot be demarcated with precision. In fact, each case has to be examined, on its facts whether the contractual relations between the parties bear insignia of public element. Once on the facts of a particular case it is found that nature of the activity or controversy involves public law element, then the matter can be examined by the High Court in writ petitions under Article 226 of the Constitution of India to see whether action of the State and/or instrumentality or agency of the State is fair, just and equitable or that relevant factors are taken into consideration and irrelevant factors have not gone into the decision-making process or that the decision is not arbitrary.

70.10. Mere reasonable or legitimate expectation of a citizen, in such a situation, may not by itself be a distinct enforceable right, but failure to consider and give due weight to it may render the decision arbitrary, and this is how the requirements of due consideration of a legitimate expectation forms part of the principle of non-arbitrariness.

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70.11. The scope of judicial review in respect of disputes falling within the domain of contractual obligations may be more limited and in doubtful cases the parties may be relegated to adjudication of their rights by resort to remedies provided for adjudication of purely contractual disputes."

18. Further, in Bharat Coking Coal Limited (supra), the Hon'ble

Apex Court provided a significant ruling on the limited scope of judicial

review in tender processes and contractual matters. The Hon'ble Court

made the following observations:

"(I) Maintainability of writ petition

28. The scope of judicial review in tenders has been explored in-depth in a catena of cases. It is settled that constitutional courts are concerned only with lawfulness of a decision, and not its soundness. [Central Coalfields Ltd. v. SLL-SML (Joint Venture Consortium), (2016) 8 SCC 622 : (2016) 4 SCC (Civ) 106; Siemens Aktiengeselischaft & Siemens Ltd. v. DMRC, (2014) 11 SCC 288] Phrased differently, the courts ought not to sit in appeal over decisions of executive authorities or instrumentalities. Plausible decisions need not be overturned, and latitude ought to be granted to the State in exercise of executive power so that the constitutional separation of powers is not encroached upon. [Air India Ltd. v. Cochin International Airport Ltd., (2000) 2 SCC 617] However, allegations of illegality, irrationality and procedural impropriety would be enough grounds for courts to assume jurisdiction and remedy such ills. This is especially true given our unique domestic circumstances, which have demonstrated the need for judicial intervention numerous times. Hence, it would only be the decision-making process which would be the subject of judicial enquiry, and not the end result (save as may be necessary to guide determination of the former).

29. This position of law has been succinctly summed up in Tata Cellular v. Union of India [Tata Cellular v. Union of India, (1994) 6 SCC 651] , where it was famously opined that: (SCC pp. 677-78, para 77)

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"77. ... Therefore, it is not for the court to determine whether a particular policy or particular decision taken in the fulfilment of that policy is fair. It is only concerned with the manner in which those decisions have been taken. The extent of the duty to act fairly will vary from case to case. Shortly put, the grounds upon which an administrative action is subject to control by judicial review can be classified as under:

(i) Illegality: This means the decision-maker must understand correctly the law that regulates his decision-

making power and must give effect to it.

(ii) Irrationality, namely, Wednesbury [Associated Provincial Picture Houses Ltd. v. Wednesbury Corpn., (1948) 1 KB 223 (CA)] unreasonableness.

(iii) Procedural impropriety."

30. But merely because the accusations made are against the State or its instrumentalities does not mean that an aggrieved person can bypass established civil adjudicatory processes and directly seek writ relief. In determining whether to exercise their discretion, the writ courts ought not only confine themselves to the identity of the opposite party but also to the nature of the dispute and of the relief prayed for. Thus, although every wrong has a remedy, depending upon the nature of the wrong there would be different forums for redress."

19. In Numaligarh Refinery Ltd. (supra), the Hon'ble Apex Court

held as follows (limited scope of judicial review)

12. DIC vide letter dated 25-11-1995 pointed out to NRL that contract price consisted of CIF value, cost of design and engineering and supervision and other incidental costs and requested for break-up of costs, so that DIC may not pay customs duty on the total contract price when such duty was payable on CIF value by the owner. Therefore, the amendment not being carried out by NRL, DIC could not avail necessary concession in customs duty. Therefore, they claimed under this head a sum of Rs 1.65 crores and the same was accepted by the majority of the arbitrators. The majority took the view that

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DIC had to unnecessarily pay the customs duty on service portion of the price consideration and as such allowed the claim. As against this, Justice M.M. Dutt in minority took a contrary view and held that NRL was not responsible for framing of such agreement and it was held that it was the fault of DIC and as such the claim was turned down. However, it was observed that DIC could justify and claim the said amount from the Customs Department but NRL could not be held responsible for the extra duty paid by DIC. The District Judge agreed with the minority award. However, the Division Bench of the High Court reversed the finding and approved the view taken by the majority of the arbitrators. We have heard learned counsel for the parties and find that it depends upon the framing of the terms of the agreement, if DIC would have been vigilant then they could have excluded the service charges, like design engineering, etc. It was their duty to have excluded the service charges but they have not properly framed the contract and they cannot insist on amendment of the contract. If all the services were subjected to duty which they could have segregated the same but since they did not do this, therefore they could not claim the benefit. No direction could be given to the contracting party to amend their agreement. It is a mutual affair of the contracting party. The view taken by the High Court does not appear to be correct. Secondly, it was not possible for NRL to amend the agreement as the same has already been registered with the Customs Authorities and Reserve Bank of India. Hence, DIC is not entitled to the aforesaid amount of Rs 1.65 crores under this head.

(Claim of Rs 1.65 crores under this head not allowed.)

(Emphasis supplied)

20. In Orissa State Financial Corporation (supra), the Hon'ble

Apex Court observed:

"6. The said order is under challenge in this appeal. On a plain reading of the impugned order it is manifest that the High Court while considering the writ petition filed by the owner of the vehicle for quashing of the notice of auction-sale and for other consequential reliefs has passed order drawing up a fresh contract between the parties and has issued certain further directions in the matter; the Corporation has been directed to

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advance a fresh loan to the writ petitioner to enable him to purchase a new truck; to enter into agreement for realization of the balance loan amount in accordance with law; to write off the remaining amount of Rs 16,500 and to order waiving of the interest till date etc. The order, to say the least, was beyond the scope of the writ petition which was being considered by the High Court and beyond the jurisdiction of the Court in a contractual matter. No doubt, while exercising its extraordinary jurisdiction under Article 226 of the Constitution the High Court has wide power to pass appropriate order and issue proper direction as necessary in the facts and circumstances of the case and in the interest of justice. But that is not to say that the High Court can ignore the scope of the writ petition and nature of the dispute and enter the field pertaining to contractual obligations between the parties and issue such directions annulling the existing contract and introducing a fresh contract in its place."

21. The Division Bench of this Court, in its judgment dated

13.10.2022 in W.A.No.651 of 2022, categorically held that the

interpretation of the terms and conditions of a contract may not be

permitted under Article 226 of the Constitution of India. The relevant

portion of the said judgment is extracted hereunder:

"9. It is a settled proposition that disputes relating to interpretation of the terms and conditions of a contract may not be permitted to be agitated in a petition under Article 226 of the Constitution of India. In Kerala State Electricity Board v. Kurien E. Kalathi1 Supreme Court held that this is a matter for adjudication by a civil Court or in arbitration if such arbitration is provided in the contract.

10. This position has been reiterated by the Supreme Court in Bharat Coking Coal Limited v. AMR Dev Prabha2 wherein Supreme Court has categorically held that writs are impermissible when the allegation is solely with regard to violation of a contractual right or duty. A person seeking writ relief should satisfy the Court that the right he is seeking is one in public law and not merely contractual."

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22. Coming to the decisions relied on by the petitioner, the same are

clearly distinguishable on facts, and thus, are of no avail to the

petitioner.

23. In the foregoing discussion, this Court finds no merit in the

present writ petition and the same is, therefore, liable to be dismissed.

24. Further, it is also relevant to note that this Court, while dealing

with a matter of similar nature in W.P.No.30770 of 2022, dismissed the

said writ petition vide order dated 13.09.2022, however, granted liberty

to the petitioner therein to approach the competent Civil Court. The

relevant portion of the said order is also extracted hereunder:

"13. In the considered opinion of this Court, the dispute in the instant case falls in the realm of civil law jurisdiction. A bare reading of few clauses of the contract would not be sufficient to determine nature of contract and interpret the disputed terms and conditions of the contract. It is an established principle of law that entire terms of the contract have to be read to understand intention of the parties and for interpreting terms of the contract. It is not within the purview of the writ jurisdiction to decide whether equivalent rate is basic rate (Rs.84.16 per litre) or market rate in the context of assertions made by the respondents in its counter and submissions of the learned senior counsel appearing for the SCCL. The contention of the respondents is that basic rate was indicated in the tabulated column under clause 1.2(e) of the order which is only for the purpose of arriving at total value of the contract. That due to the ongoing Russia-Ukraine war, there was steep increase in the price of diesel; the petitioner was aware of the changed circumstances; at no point of time, the petitioner has raised objection; the invoice rate of diesel is charged only for the excess consumption and if the petitioner is able to meet the targets with the optimum consumption of diesel, only Rs.84.16 per litre will be charged.

PK, J

14. It is borne out from the record that the petitioner has invoked dispute resolution mechanism provided under Clause 1.14 of the order. At three levels, the grievance of the petitioner was heard, and there were several deliberations between the petitioner and the SCCL authorities. It is not the case of the petitioner that there are mala fides on the part of the respondents and that the petitioner was not heard. Thus, it cannot be held that there were any violation of principles of natural justice and the respondents acted in an arbitrary manner. The petitioner having availed the remedy provided under the Dispute Redressal Committee as per clause 1.14 of the order, ought to have approached the civil Court as there are complex disputed questions of facts involved in this case and further it requires interpretation of terms and conditions of the contract. The relief if any granted to the petitioner will have financial implications on the respondents running into several crores of rupees. The market / invoice rate of diesel is demanded by the respondents only for the excess consumption of diesel by the petitioner. So far as supply of diesel for the notified quantity, the rate charged by the respondents is Rs.84.16 per litre irrespective of the market price / invoice price. In the opinion of this Court, detailed analysis of terms and conditions of the contract and interpretation thereof is required to reach a conclusion that the equivalent rate as per clause 1.4.b of the order is basic rate of Rs.84.16 per litre. The dispute in ABL International Limited's case (Supra 1) was entertained by the Apex Court by coming to a conclusion that there is no ambiguity in the terms of the policy (See Paragraph No.53). The contention of contra proferentem rule put-forth by the learned counsel for the petitioner will have to be considered only when the Court deciding the dispute comes to the conclusion that there are two possible interpretations. The said judgment is not relevant in the instant case in view of the observations of this Court in the preceding paragraphs that the matter involves disputed questions fact and interpretation of terms of the contract which do not come within the realm of writ jurisdiction. It is nobody's case that writ Court does not have jurisdiction to entertain contractual disputes. The border line is discretion of the Court. The writ Court would exercise discretion in contractual matters keeping in mind the factors like availability of alternate remedy, existence of disputed questions of fact, complexity of dispute, interpretations of terms of contract, the contract being private in nature and no public law element is involved etc.

PK, J

15. The subject contract is a private contract. As noted above, there is no allegation of mala fides on the part of the respondents and the respondents have adhered to the dispute redressal mechanism under the contract. Further, the instant case is not a case of simple nature and the resolution thereof requires detailed analysis and interpretation of terms of the contract; oral and documentary evidence is required to be adduced by the parties, which, normally, is the domain of civil law Courts. [See: Kerala State Electricity Board's case (Supra 3) and Joshi Technologies International INC's case (Supra 4)]. Thus, exercise of jurisdiction under Article 226 of the Constitution is not warranted. There are no merits in the present writ petition."

25. In the instant case, as per Clause 1.14.3 of the Work Order dated

14.11.2022, any dispute arising out of the contract, including issues

related to its interpretation, performance, breach, or termination, which

is not settled through negotiations, must be resolved by filing a case

before a civil court having competent pecuniary and territorial

jurisdiction, or before the Civil Court at Bhadradri-Kothagudem District.

"1.14 SETTLEMENT OF DISPUTES:

1.14.3 Civil Court

In the event of any question, dispute or difference arising under the terms and conditions or interpretation of the terms of, or in connection with Purchase Order/Contract/Agreement (except as to any matter the decision of which is specially provided for by these conditions), or the performance of any of the obligations of SCCL and the contractor hereunder or referred to herein, including an issue or dispute as to breach or termination of this contract or as to any claim in toto, in equity or pursuant to any statute ("Dispute") is not settled through negotiations, the respective parties can seek remedy through 'CIVIL COURT' having competent pecuniary and territorial jurisdiction or at competent court in Bhadradri-Kothagudem district and not by Arbitration.

PK, J

No dispute shall be referred to Arbitration other than civil courts. No dispute shall be entertain in any form and on any matter pertaining to contract except herein above mentioned."

26. Since the petitioner has not availed this remedy and has directly

approached this Court under Article 226 of the Constitution of India,

this Court is not inclined to entertain the present writ petition and the

same is liable to be dismissed.

27. Accordingly, the Writ Petition is dismissed. However, the

petitioner is at liberty to approach the competent Civil Court as per

Clause 1.14.3 of the Work Order No.7600009305 dated 14.11.2022, for

redressal of its grievance, if it so desires.

Miscellaneous applications, if any, pending in this writ petition,

shall stand closed. No costs.

_________________________________ JUSTICE PULLA KARTHIK Date: 19.06.2025.

GSP