Tripura High Court
Food Corporation Of India vs Smt. Namita Paul on 13 May, 2025
Author: T. Amarnath Goud
Bench: T. Amarnath Goud
HIGH COURT OF TRIPURA
AGARTALA
WA 12 of 2025
1. Food Corporation Of India
represented by its Chairman-cum-Managing Director
A Government of India undertaking having its office at 16 20 Barakhamba Lane,
New Delhi - 110001
2. The General Manager, (R)
Food Corporation Of India
Regional Office North East Frontier Region, Mawlai Mawroh, Shillong 793008
3. The Asst General Manager (Contract)
Food corporation of India North East frontier, Mawlai, Mawroh, Shillong 793008
4. The Divisional Manager
Food Corporation of India, Divisional Office, AIZAWL, Tuikhuahtlang Road,
Aizawl, Mizoram 796001
5. The Divisional Manager
Food Corporation of India, Divisional Office, Agartala opp Don Bosco School,
Nandannagar, Agartala, West Tripura- 799006
-----Appellant(s)
Versus
Smt. Namita Paul
Wife of Shri Swapan Kumar Paul, Resident of B.K. Road, Banamalipur, Agartala,
PS: East Agartala, District: West Tripura.
-----Respondent(s)
WA 13 of 2025
1. Food Corporation Of India
represented by its Chairman-cum-Managing Director
A Government of India undertaking having its office at 16-20 Barakhamba Lane,
New Delhi - 110001
2. The General Manager (R),
Food Corporation of India
Regional Office North East Frontier Region, Mawlai, Mawroh, Shillong 793008
3. The Asst General Manager (Contract)
Food Corporation of India
North East Frontier Region, Mawlai, Mawroh, Shillong
4. The Divisional Manager,
Food Corporation of India, Divisional Office, Agartala opp Don Bosco School,
Nandannagar, Agartala, West Tripura- 799006
-----Appellant(s)
Versus
Smt. Namita Paul
Wife of Shri Swapan Kumar Paul, Resident of B.K. Road, Banamalipur, Agartala,
PS: East Agartala, District: West Tripura.
-----Respondent(s)
WA 14 of 2025
1. Food Corporation Of India
represented by its Chairman-cum-Managing Director
A Government of India undertaking having its office at 16 20 Barakhamba Lane,
New Delhi - 110001
2. The General Manager (R),
Food Corporation of India
Regional Office North East Frontier Region, Mawlai, Mawroh, Shillong 793008
3. The Asst General Manager (Contract)
Food Corporation of India
North East Frontier Region, Mawlai, Mawroh, Shillong
4. The Divisional Manager,
Food Corporation of India, Divisional Office, Agartala opp Don Bosco School,
Nandannagar, Agartala, West Tripura- 799006
-----Appellant(s)
Versus
Smt. Namita Paul
Wife of Shri Swapan Kumar Paul, Resident of B.K. Road, Banamalipur, Agartala,
PS: East Agartala, District: West Tripura.
-----Respondent(s)
WA 15 of 2025
1. Food Corporation Of India
represented by its Chairman-cum-Managing Director
A Government of India undertaking having its office at 16 20 Barakhamba Lane,
New Delhi - 110001
2. The General Manager (R),
Food Corporation of India
Regional Office North East Frontier Region, Mawlai, Mawroh, Shillong 793008
3. The Asst General Manager (Contract)
Food Corporation of India
North East Frontier Region, Mawlai, Mawroh, Shillong
4. The Divisional Manager,
Food Corporation of India, Divisional Office, Agartala opp Don Bosco School,
Nandannagar, Agartala, West Tripura- 799006
-----Appellant(s)
Versus
Smt. Namita Paul
Wife of Shri Swapan Kumar Paul, Resident of B.K. Road, Banamalipur, Agartala,
PS: East Agartala, District: West Tripura.
-----Respondent(s)
WA 4 of 2025
1. Food Corporation Of India
represented by its Chairman-cum-Managing Director
A Government of India undertaking having its office at 16 20 Barakhamba Lane,
New Delhi - 110001
2. The General Manager (R),
Food Corporation of India
Regional Office North East Frontier Region, Mawlai, Mawroh, Shillong 793008
3. The Asst General Manager (Contract)
Food Corporation of India
North East Frontier Region, Mawlai, Mawroh, Shillong
4. The Divisional Manager,
Food Corporation of India, Divisional Office, Agartala opp Don Bosco School,
Nandannagar, Agartala, West Tripura- 799006
-----Appellant(s)
Versus
Smt. Namita Paul
Wife of Shri Swapan Kumar Paul, Resident of B.K. Road, Banamalipur, Agartala,
PS: East Agartala, District: West Tripura.
-----Respondent(s)
WA 16 of 2025
1. Food Corporation Of India
represented by its Chairman-cum-Managing Director
A Government of India undertaking having its office at 16 20 Barakhamba Lane,
New Delhi - 110001
2. The General Manager (R),
Food Corporation of India
Regional Office North East Frontier Region, Mawlai, Mawroh, Shillong 793008
3. The Asst General Manager (Contract)
Food Corporation of India
North East Frontier Region, Mawlai, Mawroh, Shillong
4. The Divisional Manager,
Food Corporation of India, Divisional Office, Agartala opp Don Bosco School,
Nandannagar, Agartala, West Tripura- 799006
-----Appellant(s)
Versus
Smt. Namita Paul
Wife of Shri Swapan Kumar Paul, Resident of B.K. Road, Banamalipur, Agartala,
PS: East Agartala, District: West Tripura.
-----Respondent(s)
For Appellant(s) : Mr. B. K. Singh, Advocate.
Mr. Rana Gopal Chakraborty, Advocate.
For Respondent(s) : Mr. Raju Datta, Advocate.
Date of hearing and date of
judgment and order : 13.05.2025.
Whether fit for reporting : Yes
HON'BLE MR. JUSTICE T. AMARNATH GOUD
HON'BLE MR. JUSTICE BISWAJIT PALIT
Judgment & Order (Oral)
(T. Amarnath Goud, J)
These appeals are filed under Chapter VIII, Rule B(A) of the High
Court of Tripura Rules, 2023 preferred against the judgment and order dated
31.05.2024 passed by the learned Single Judge in WP(C) 692 of 2023 and batch
cases.
[2] At the very outset, it is represented by the counsel for the parties that
since the subject matter of all the writ appeals mentioned above came out of the
similar facts and circumstances, all may be heard and disposed of together. Having
heard so, all the matters are clustered together as the facts involved are similar in
nature and can be disposed of a common judgment. For the sake of brevity and as
desired by both sides, we are taking WA 12 of 2025 as the lead case for disposing of
the matters.
[3] It is the case of the appellants that in response to NIT issued by the
appellants, the respondent-writ petitioner was awarded transport contract for two
years for loading/unloading and handling of food grains /sugar/allied materials from
railway siding Changsari/ CWC Godown, Amingaon/ RH FSD Guwahati to FSD
Bualpui vide appointment letter dated 10.07.2008. Upon completion of the contract,
the respondent issued letters on 04.09.2017, 12.04.2018 and 28.05.2020 to refund
the pending security deposit to the respondent. In response, the appellant replied
vide letter dated 29.10.2020 stated that FCI has suffered loss to the tune of Rs.
1,23,11,613/- in a contract awarded to the respondent vide appointment letter no.
CONT.9/NEFR/TC/CBZ-CDR/09 dated 29.04.2009 and that the matter was sub
judice.
[4] The respondent approached this Court with regard to the present
contract on 08.03.2022 by filing WP(C) No. 240 of 2022 and prayed for directing
the appellant to refund the security deposit amounting to Rs. 24,95,132/- along with
interest @12% p.a. w.e.f. 08.07.2013. This Court after hearing both the parties
disposed off the WP(C) No. 240 of 2022 vide its Order dated 02.05.2023 by setting
aside the impugned Order and the FCI appellants were directed to reconsider the
claim of the respondent in accordance with law. The respondent vide representation
dated 13.06.2023 prayed to reconsider his case as per the direction of this Court.
[5] The appellant No. 2 vide letter dated 05.09.2023 stated that the
security deposit of Rs. 24,95,132/- was set off by the respondent against the losses
suffered by the FCI in other transportation work amounting to Rs. 3,12,98,215/- as
per clause XI(b), XII(b) and XII (e) of the contract agreement and requested the
respondent to deposit an amount of Rs. 2,60,11,861/- towards balance recoverable as
on date after set off.
[6] The respondent approached this Court by filing W.P(C) No. 692/2023
against the impugned order dated 05.09.2023. The Learned Single Judge vide Order
dated 31.05.2024 held that the impugned order dated 05.09.2023 issued by the FCI
respondent be set aside and quashed. The learned Single Judge further directed the
FCI to release/refund the security deposit within a period of 30 (thirty) days.
[7] Aggrieved by the said impugned Judgment dated 31.05.2024, the
appellant has approached before this court for seeking relief in the present appeals.
[8] A bare reading of the record shows that the entire matter runs around
the Contracts issued by the appellants-FCI in favour of the respondent-contractor
from time to time.
Below is the list of six contracts issued by the appellants-FCI in favour
of the respondent-contractor:
Sl Writ Appeal No. Contract No. Date of
No. Contract
1 WA 4 of 2025 Cont.7/NEFR/TC/CHNG- 18.06.2008
DMR/2008-Adhoc
2 WA 12 of 2025 Cont.7/NEFR/TC/CHNG- 10.07.2008
BPI/2008-4429
3 WA 15 of 2025 Cont.9/NEFR/HANDLING- 31.08.2006
DMR/2006
4 WA 14 of 2025 Cont.9/NEFR/HANDLING- 22.03.2010
NGR/2009
5 WA 13 of 2025 Cont.9/NEFR/HANDLING- 14.03.2008
NGR/07
6 WA 16 of 2025 Cont.9/NEFR/TC/CHNG- 27.01.2009
DMR/2008-Adhoc
[9] It is also represented by the counsel for the parties that WA 12 of
2025, WA 4 of 2025 and WA 16 of 205 are all related with transportation contract
for carrying food grains and the remaining three Writ appeals being WA 13 of 2025,
WA 14 of 2025 and WA 15 of 2025 are related with handling contract i.e. supply of
labourers for loading and unloading of food grains.
[10] Mr. Raju Datta, learned counsel appearing for the respondent-
contractor in all the writ appeals, at the very outset, has submitted that the
respondent had successfully completed the contract works within the stipulated
period of the respective agreements mentioned in each of the writ appeals and
obtained from the appellants 'No Demand Certificates' in respect of all the work
contracts. Therefore, the appellants cannot withhold the respective security deposits
as claimed by the respondent in the instant writ appeals after full satisfaction of their
work contracts. He further argued that there is no scope of demanding demurrage
charges from the respondent-contractor. The respondent never violated any terms
and conditions of the agreements made with the appellants-FCI. And during or after
the contract period, the appellants never issued any adverse notice. But, on the other
hand, they issued No Demand Certificate after duly satisfied.
[11] After getting, „No Demand Certificate‟ from the appellants-
Corporation, the respondent claimed for releasing her security deposit kept against
the respective contract agreements as mentioned in the instant writ appeals, but the
appellants-Corporation did not release the same rather, they adjusted the respective
security deposits alleging the negligent and unworthy man like performance of the
petitioner in execution of some "other transport contract." While forfeiting the said
security deposit of the respondent, the appellants by the communication dated
29.10.2020 has cited clauses No.XI(b), XII(b) and XII (e) of the tender
document/agreement of the above cited contract which read as under:
"Clause XI. Security Deposit:
(a) ****
(b) The security deposit will be refunded to the contractors on due and
satisfactory performance of the services and on completion of all
obligations by the contractors under the terms of the contract and on
submission of a No Demand Certificate, subject to such deduction from the
security as may be necessary for making up of the Corporations claims
against the contractor.
Clause XII. Liability of Contractors for losses etc. suffered by Corporation:
(a) ****
(b) The Corporation shall be at liberty to reimburse themselves of any
damages, losses, charges, costs or expenses suffered or incurred by them
due to contractors negligence and un-workmanlike performance of service
under the contract or breach of any terms thereof. The total sum claimed
shall be deducted from any sum than due or which at any time hereafter
may become due to the contractors under this or any other contract with
the Corporation. In the event of the sum which may be due from the
Corporation as aforesaid being insufficient the balance of the total sum
claimed and recoverable from the contractors as aforesaid shall be
deducted from the security deposit furnished by the contractors as specified
in Para XI. Should this sum also be not sufficient to cover the full amount
claimed by the Corporation, the contractors shall pay to the Corporation
on demand the remaining balance of the aforesaid sum claimed.
(c) ****
(d) ****
(e) A set off any sum of money due and payable to the contractors
(including security deposit returnable to them) under this contract may be
appropriated by the Corporation and set-off against any claim of the
Corporation for the payment of any sum of money arising of this or under
any other contract made by the contractors with the Corporation."
[12] On careful reading of the provisions of Clause No. XI(b), XII(b) and
XII(e) of the tender document as quoted above, in the opinion of this Court, before
invoking set-off Clause under Clause XII(e), it must be proved that the Corporation
suffered loss due to negligence or un-workman like performance of the contractor in
execution of any work under any contract. There is no material or details of breakup
how the respondents-Corporation suffered loss in execution of any other contract
works. Negligence or un-workman like performance being a matter of fact is to be
established by laying evidence where all materials and records are to be placed and
this only can be considered by a Civil Court.
[13] In this regard, the FCI preferred a Commercial suits being Commercial
suit 03of 2016 before the Court of Judge, District Commercial Court, West Tripura,
Agartala, Court No.2 and the same was dismissed by the judgment dated 31.01.2019
which stood challenged by RFA 16 of 2016 and RFA 17 of 2019 in this High Court.
The same was dismissed by the order dated 24.05.2021. Subsequently, FCI preferred
SLP NO 20710-20711 of 2021 and the same are pending. However, during the legal
battle, the FCI released the amounts to the respondent-contractor herein and
according to the FCI, the lis becomes academic. However, the money recovery and
release of Security Deposit are separate legal proceedings initiated. This court is not
inclined to enter into the aspect of money recovery suit.
[14] It is apparent from the record that the respondent approached this court
by way filing a writ petition challenging the communicated dated 29.10.2020 issued
by the appellants-FCI to refund the Security Deposit amounting to Rs.24,95,132/-.
Subsequently, an order dated 28.06.2022 was passed in WP(C) 240 of 2022
directing the appellants-FCI herein to consider the request of the respondent-
contractor herein with regard to releasing of her benefits and take a decision on the
matter within a period of 1 (one) month from the date of receipt of copy of that order
in accordance with law.
[15] In pursuant to the order dated 28.06.2022 passed in the WP(C)240 of
2022, the respondent-herein approached the appellants-FCI making a prayer dated
08.07.2022 to refund the Security Deposit amounting to Rs.24,95,132/- along with
interest at the rate of 12% per annum w.e.f. 08.07.2013 till the payment in respect of
transportation of food grains/sugar/allied material from Railway siding
Chansari/CWC Godown, Amingaon/RH.FSD Guwahati to FSD Bualpari on the
basis of agreement executed by the respondent under appointment letter
no.CONT.7/NEFR/TC/CHNG-BPI/2008/4429 dated 10.07.2008.
[16] The appellants-FCI on receipt of such representation from the
respondent has passed a reasoned order dated 22.07.2022 rejecting the
representation dated 08.07.2022. The relevant text of the reasoned order dated
22.07.2022 issued by the appellants-FCI is reproduced herein below:
"The undersigned, in perusal of the judgment dated 28.06.2022
passed in WP(C) 240 of 2022 and taking into consideration all the facts
and circumstances as well as the agreed terms and conditions of the
Tender Agreement executed between you and the Corporation, your
Security Deposit of Rs. 24,95,132/- deposited in Transport Contract for the
transportation of food grain/ sugar/ allied materials from Railway Siding
Changsari/ CWC Godown Amingaon/ RH.FSD Guwahati to FSD Bualpui,
Mizoram, cannot be considered due to the above stated losses suffered by
the Corporation and the same is hereby set off."
[17] Aggrieved by the said action of the appellants-FCI, the respondent
herein approached this court by way of filing a writ petition being WP(C) 758 of
2022 which was disposed of by the order dated 02.05.2023 and the relevant part of
the said order is extracted herein below for ready reference.
[11] Further, it is reiterated herein that the submission of the petitioner
that no demand certificate has been issued by the respondent corporation
is false, baseless and without any substance, as no such demand certificate
has ever been issued by the respondent corporation. Thus the submission of
the petitioner on this score is to mislead this Court for her illegal gain and
to misuse the public money in particular. However, M.S. No.27 of 2010
filed by the petitioner was dismissed by the learned Civil Judge on merit.
Against the said judgment and decree dated 11.05.2016 passed by the
learned Civil Judge Senior Division, Court No.1, West Tripura, Agartala
the petitioner had preferred appeal before this Court which was registered
as RFA. No.14 of 2016. Vide judgment and decree dated 26.02.2021, the
said appeal filed by the petitioner was allowed as FCI failed to prove the
actual loss suffered by FCI by adducing documentary evidence.
[12] Moreover, the petitioner is relying upon judgments and decrees
passed by the Civil Courts in writ proceedings which is not permissible
under the law. In fact, the findings of the learned Civil Court vide judgment
and decree dated 11.05.2016 passed in MS.No.27 of 2010 and M.S. (CC)
14 of 2011 as merged with the judgment and decree dated 26.02.2021
passed in RFA. No.14 of 2016 passed by this Court is against the
petitioner.
[13] In view of above discussion, the present petition stands disposed of
directing the petitioner to represent the matter before the respondents
along with all relevant documents in support the claim of the petitioner
more particularly, any judgment of the High Court or any other Court on
receipt of the representation, the respondents shall consider the same in
accordance with law within a period of three months from the date of
receipt of the copy of such representation.
[14] In view of above and after hearing the arguments advanced by the
learned counsel more particularly, having observed the evidence on
record, it reveals that there is no evidence submitted by the petitioner
providing any security deposit. Hence, without expressing any opinion on
merit, the claim of the petitioner may not be considered and thus, ordered
as this Court is not inclined to enter into the issue and decide the same. The
impugned orders are set aside; the respondents are directed to re-consider
the case of the petitioner in accordance with law. Accordingly, the present
petition stands disposed of."
[18] In pursuant to the order dated 02.05.2023 passed in the WP(C) 758 of
2022, the respondent-herein approached the appellants-FCI making a prayer dated
13.06.2023 for implementation of the Order dated 02.05.2023 passed in WP(C) 758
of 2022 by this Court and to refund the security deposit of the respondent herein
amounting to Rs.24,95,132/- along with interest at the rate of 12% per annum w.e.f
08.07.2013 till the date of payment in respect of transportation grains/sugar/allied of
food material from Railway siding Changsari/CWC Godown, Amingaon/RH.FSD
Guwahati to FSD Bualpui on the basis of agreement executed by me under
appointment letter No.CONT.7/ NEFR / TC /CHNG-BPI/2008/4429 dated
10.07.2008.
[19] A bare perusal of the record shows that the appellants-FCI by the
communication dated 05.09.2023 issued by the Asstt. Genl. Manager (Cont.) For
General Manager (R) has again rejected the prayer dated 13.06.2023 of the
respondent. The relevant part of the said communication dated 05.09.2023 is
extracted herein below for ready reference:
"2. That you have claimed for the release of the aforesaid Security Deposit vide
NDC dated 08.07.2013. The Corporation had suffered huge losses in the Contracts
executed by you due to your negligence and unworkmanship like performance, the
details of which are tabulated below. Despite the notices issued to you on 19.03.11,
02.04.11, 18.06.11, 11.07.11, 21.07.11, 26.08.11, 07.09.11, 02.03.12 and
11.05.2012 for remittance of the below mentioned losses to the corporation, you
neither made remittance so far nor replied to the notices.
S. Name of the Period Amount of Reason of losses
No. Contract losses
incurred by
the
corporation in
Rs
01 CONT.9/NEFR/TC/ 01.05.2009 - 1,23,11,613 Loss incurred by
CBZ-CDR/09 dated 30..04.2011 FCI against Risk &
09.04.2009 Cost for getting the
work done by
another contractor
02 CONT.9/NEFR/TC/ 16.11.2009 - 1,89,86,602 Loss incurred by
CBZ-ADNR/09 15.11.2011 FCI against Risk &
dated 12.11.2009 cost for getting the
work done by
another contractor
Total 3,12,98,215
3. That you have failed to remit the amount of losses caused to FCI as explained
above, FCI was forced to invoke the Clause XII (b) and XII (e) of the tender
agreement and according to which the aforesaid Security deposit of Rs 24,95,132/-
in Cont.7/NEFR/TC/CHNG-BPI/2008 dt. 10.07.2008 was set off against the above
losses vide Order issued by Divisional Office Aizawl under Ref. No.
Cont.5(14)/GHY-BLP/NP/08 dated 22.07.2023."
[20] In addition to what have been stated here-in-above, it has also come to
fore that the FCI-Corporation instituted Commercial being C.S 04 of 2016 before
the learned District Commercial Court against the respondents. On consideration of
the evidence on record, the learned Court below dismissed the suit. FCI-Corporation
preferred appeal being RFA 26 of 20222 before this Court, which upon hearing was
dismissed by the judgment and order dated 19.10.2023 and later on, SLPs 27419-
27420 preferred by the FCI also have been dismissed by the Hon‟ble Supreme Court
by the order dated 04.01.2024.
[21] It is also apparent from the record that the appellants-FCI herein also
filed a Commercial Suit No.03 of 2016 before the Court of the District Commercial
Court, West Tripura, Agartala, Court No.2 against the respondent and the same by
the judgment dated 31.01.2019 was dismissed by the learned court below.
[22] Aggrieved by the said judgment dated 31.01.2019, the appellants-FCI
has preferred a Regular First Appeal before this court (being RFA 16 of 2019 along
with RFA 17 of 2019) and the same was dismissed by the judgment and order dated
24.05.2021. It appears from the record that the appellants-FCI has preferred an SLP
(being SLP 20710-20711/2011) before the Hon‟ble Apex Court and the same are
pending. However, as stated (supra) litigations pertaining security deposit and
money recovery suits are distinct.
[23] Mr. B.K. Singh, learned counsel for the appellants-FCI has contended
before this court that the learned Single Judge failed to notice that contractor was
given opportunity even in terms of show cause notice dated 23.06.2023. Besides the
reply of the petitioner dated 30.06.2023, her representation dated 13.06.2023 was
duly considered before the letter dated 05.09.2023 was issued regarding setting off
the security deposit in terms of clause XI(b), clause XII (b) and clause XII(e) of the
contract Agreement and seeking payable balance of Rs 2,60,11,871 from the
contractor. As such, the requirement of "providing hearing & representation before
the setting off the security deposit" as pointed out by the learned single judge stands
fulfilled by the corporation.
[24] He further contended that the learned Single Judge failed to appreciate
the fact that the respondent contractor (writ petitioner) consented to abide by the
tender agreement of the aforesaid contract dated 22.03.2010 and the Clauses laid
therein, more specifically Clause Nos. XI (b), XII (b) and XII (e) of the tender
agreement which authorizes the Corporation to set off/ appropriate any payable
amount including the security deposit of other contracts awarded to the same
contractor and therefore the action of the FCI is not illegal.
[25] It is also contended by the learned counsel for the appellant that the
learned Single Judge failed to appreciate the claim of the respondent (writ petitioner)
that FCI had issued a no demand certificate is totally baseless and fabricated aiming
to mislead this Court. It was contended that there is no clause or provision in the
instant tender agreement that no demand certificate is to be issued by the
Corporation. Further, the FCI never issues any no-demand certificate to any
contractor, in fact, the no-demand certificate is submitted by the contractor
themselves and upon submission of such no demand certificate by the contractor, it
undergoes examination at various levels for scrutiny and working out liabilities
incurred and then it is forwarded by the Divisional Office to the Regional Office
with signature and comments/ recommendation on release of security deposit which
again undergoes scrutiny at regional office level before decision on release of
security deposit, if applicable.
[26] Having considered the submission as advanced by the counsel for the
parties and also having gone through the record, this court is of the opinion that the
action of the appellants-FCI in issuing No Demand Certificate in respect of the
contract relying the clause XI and withholding the Security Deposit referring to
Clause XII(b) and (e) fell inconsistent.
[27] A bare reading of the both the clauses shows that Clause XI and XII
are interlinked. Now, it is not open for the appellants-FCI on one hand to issue No
Demand Certificate in respect of the respondent-contractor and withhold the
Security Deposit under clause XII(b) and (e) of the contract agreement due to loss
incurred in some other contract.
[28] The Clause XII(b) and (e) of the agreement are like weapon to protect
the interest of the Food Corporation of India (FCI) and the same has to be used
appropriately. But, here is the case, where the appellants-FCI have not exercised the
power under Clause XII (b) & (e) timely and have not initiated any action against
the respondent-contractor.
[29] The appellants-FCI have failed to place before this Court either any
document or any pleading to say that prior to the issuing of the present impugned
order in the writ petition, proceedings were already initiated against the respondent-
contractor under clause XII (b) and (e) and amount of damages as contemplated
under Clause XII have been determined as per law.
[30] They have also failed to show that the Security Deposit is being
withheld in respect of the damages incurred, which arose due to the petitioner's
laches concerning certain other contracts. In the absence of such exercising of
powers, it is not open for the appellants-FCI to withhold the Security Deposit.
[31] It is not disputed by both sides that amount claimed by the respondent-
contractor towards Security Deposit were already released by the appellants-FCI.
Therefore, nothing survives for adjudication.
[32] However, it is not for this court to touch the issues involved in the
SLPs (in SLP 20710-20711/2011) before the Hon‟ble Apex Court as this court is
cautious about its limitations jurisdictions.
[33] Moreover, this court has not found any force in the submission as
advanced by the counsel for the appellants-FCI. He also could not produce any
judgment or document to support his contention. Therefore, without touching the lis
pending before the Hon‟ble Supreme Court Money Recovery Suit filed by the Food
Corporation of India, the present writ appeals are dealt with independently and
hereby decided.
[34] This Court also expresses its concern regarding the functioning of the
responsible officers in the Food Corporation of India. At one level, subordinate
officers issue a No Demand Certificate, while at a higher level, the officers find fault
with the subordinates action. According to the higher authorities, the release of the
Security Deposit should be withheld. In matters involving substantial monetary
transactions between the officers of FCI and the contractors, it is essential that
senior officers closely monitor the situation and issue timely instructions and
guidelines to their subordinates. If there is any instance of violation of such
instructions, like in present case, appropriate action must be taken against the erred
officers.
[35] The public money and exchequer of FCI cannot be allowed to handle
casually and cause loss. In the present case, if the higher authorities find fault with
the issuance of the No Demand Certificate by subordinate officers and have decided
to withhold the security deposit, there is no indication, either in the pleadings or in
any document, of what action, if any, has been initiated against the subordinate
officers for acting contrary to the interest of the FCI.
[36] For the discussion made above, this Court feels that the above appeals
suffer from lack of merit and are liable to be dismissed.
[37] With the above observation, the appeals stand dismissed confirming
the impugned judgment and order dated 31.05.2024 passed by the learned Single
Judge in WP(C) 692 of 2023.
As a sequel, stay, if any, stands vacated. Pending application(s), if any,
also stands closed.
B.Palit, J T. Amarnath Goud, J
Dipak
DIPAK Digitally signed by
DIPAK DAS
DAS Date: 2025.05.22
14:43:08 +05'30'
