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2010 DIGILAW 546 (CAL)

Sisir Kumar Bhowmik v. UNION OF INDIA

2010-05-18

DIPANKAR DATTA

body2010
JUDGMENT: A work which the Oil and Natural Gas Corporation Ltd. (hereafter ONGC), respondent 2, entrusted the petitioner’s proprietorship firm to execute within 45 days from 10.6.2003 was actually completed on 14.10.2004. For delay in complete execution of work, the vigilance cell of ONGC recommended recovery of Rs.1,70,296/- from the petitioner, inclusive of Rs.1,31,129/- towards liquidated damages for delayed completion of work and Rs.39,167/- as penalty for non-deployment of technical persons and non-maintaining of labour attendance register in terms of the provisions of the contract. However, the final bill for payment raised by the petitioner was allowed and payment was released without making any deduction towards recovery of liquidated damages, referred to above. The competent authority of ONGC (not specified in the counter affidavit of ONGC who he is) had not approved waiver of liquidated damages. While initiating disciplinary action against the officer responsible for such lapse, ONGC invoked clause 29 of the contract between the parties and withheld security deposits of the petitioner in respect of two other contracts which the petitioner performed successfully aggregating to Rs.1,31,134/-. The petitioner complains of arbitrariness of ONGC in withholding the security deposits. According to him, the fact that the security deposits had been withheld in respect of delayed execution of the earlier work was never informed and it is only upon perusal of the counter affidavits filed in this proceeding that he came to learn of the same. Mr. Majumdar, learned advocate representing the petitioner criticized the impugned action as entirely without jurisdiction. By placing reliance on the decision reported in AIR 1970 SC 1955 , Maula Bux v. Union of India, he contended that a party claiming compensation must prove the loss suffered by him where loss in terms of money can be determined. ONGC having failed to prove loss suffered by it by reason of delayed completion of the earlier work the petitioner was entrusted to execute, he prayed for a direction on it to release the withheld security deposits. Mr. Ghosh, learned advocate for ONGC and its officers objected to maintainability of the petition by contending that the dispute is capable of being resolved through arbitration in terms of the contracts in question and, therefore, the Court ought to be loath in granting relief as claimed. Mr. Ghosh, learned advocate for ONGC and its officers objected to maintainability of the petition by contending that the dispute is capable of being resolved through arbitration in terms of the contracts in question and, therefore, the Court ought to be loath in granting relief as claimed. On merits, he referred to clause 29 of the contract being the source of power to withhold security deposit and submitted that ONGC was well within its rights in not releasing the security deposits of the petitioner. He, accordingly, prayed for dismissal of the petition. In reply, Mr. Majumdar submitted that the petition having been admitted by the Court and affidavits having been exchanged, it is too late in the day to contend that the petitioner ought to be relegated to arbitration. He also relied on the decision reported in 2005 (2) CHN 50 , Atrayee Gas Service vs. Indian Oil Corporation Ltd. & ors., to contend that provision for resolution of dispute by arbitration would not stand in the way of the Court of Writ to grant relief if the issue raised relates to enforcement of fundamental right under Article 19(1) (g) of the Constitution. I have heard the parties. The petitioner has prayed for a writ of or in the nature of Mandamus for refund of security deposits aggregating to Rs.1,31,134/- and Prohibition prohibiting them from withholding the said security deposits. The petitioner in his reply affidavit has cited the reasons for which he could not complete the work on time. Whether the same are genuine reasons or not have to be proved. Loss, if at all, suffered by ONGC is another point which may be required to be proved. These are issues which cannot be decided on affidavit evidence. That apart, it would be necessary to ascertain on oral evidence how the parties understood clause 29 with its several printing errors while executing the contract and the situations in which the same would be applied. Investigation of factual aspects would be essential for giving a decision on the petitioner’s claim. The objection raised by Mr. Ghosh is not without substance. In its decision reported in (1996) 6 SCC 22 , State of U.P. v. Bridge & Roof Co. (India) Ltd., the Supreme Court held as follows: “16. Firstly, the contract between the parties is a contract in the realm of private law. It is not a statutory contract. The objection raised by Mr. Ghosh is not without substance. In its decision reported in (1996) 6 SCC 22 , State of U.P. v. Bridge & Roof Co. (India) Ltd., the Supreme Court held as follows: “16. Firstly, the contract between the parties is a contract in the realm of private law. It is not a statutory contract. It is governed by the provisions of the Contract Act or, may be, also by certain provisions of the Sale of Goods Act. Any dispute relating to interpretation of the terms and conditions of such a contract cannot be agitated, and could not have been agitated, in a writ petition. That is a matter either for arbitration as provided by the contract or for the civil court, as the case may be. Whether any amount is due to the respondent from the appellant-Government under the contract and, if so, how much and the further question whether retention or refusal to pay any amount by the Government is justified, or not, are all matters which cannot be agitated in or adjudicated upon in a writ petition. The prayer in the writ petition, viz., to restrain the Government from deducting a particular amount from the writ petitioner’s bill(s) was not a prayer which could be granted by the High Court under Article 226. Indeed, the High Court has not granted the said prayer. ****** 18. Accordingly, it must be held that the writ petition filed by the respondent for the issuance of a writ of mandamus restraining the Government from deducting or withholding a particular sum, which according to the respondent is payable to it under the contract, was wholly misconceived and was not maintainable in law. [See the decision of this Court in Asstt. Excise Commr. v. Issac Peter, (1994) 4 SCC 104 where the law on the subject has been discussed fully.] The writ petition ought to have been dismissed on this ground alone.” On the authority of the above decision, it has to be held and I do hold that the present case does not deserve writ powers to be exercised. In a case of the present nature, the principle laid down in the decision reported in AIR 1971 SC 33 , L. Hirday Narain v ITO, would not be of any help to the petitioner. In a case of the present nature, the principle laid down in the decision reported in AIR 1971 SC 33 , L. Hirday Narain v ITO, would not be of any help to the petitioner. I would prefer to be guided by the decision reported in (2008) 12 SCC 675 , State of U.P. v. U.P. Rajya Khanij Vikas Nigam Sangharsh Samiti wherein it has been ruled as follows: “38. ***** True it is that issuance of rule nisi or passing of interim orders is a relevant consideration for not dismissing a petition if it appears to the High Court that the matter could be decided by a writ court. It has been so held even by this Court in several cases that even if alternative remedy is available, it cannot be held that a writ petition is not maintainable. In our judgment, however, it cannot be laid down as a proposition of law that once a petition is admitted, it could never be dismissed on the ground of alternative remedy. If such bald contention is upheld, even this Court cannot order dismissal of a writ petition which ought not to have been entertained by the High Court under Article 226 of the Constitution in view of availability of alternative and equally efficacious remedy to the aggrieved party, once the High Court has entertained a writ petition albeit wrongly and granted the relief to the petitioner.” It is, therefore, not the law that once a writ petition is entertained and affidavits are exchanged, the petitioner cannot be relegated to an available alternative forum to seek his remedy. In a given case where availability of an efficacious alternative remedy is not set up as a preliminary objection to the entertainability of a writ petition, a Court of Writ would still retain the discretion not to decide the claim on merits if such claim cannot effectively be decided on affidavit evidence and would be justified, even at the stage of final hearing and while terminating the proceedings before it, in granting liberty to the petitioner to seek his alternative remedy. The decision in Atrayee Gas Service (supra) relates to suspension of dealership. The decision in Bridge & Roof Co. (India) Ltd. (supra) was noticed but not distinguished. The ratio of the said Supreme Court decision squarely applies in the present case for which I decline to interfere. The decision in Atrayee Gas Service (supra) relates to suspension of dealership. The decision in Bridge & Roof Co. (India) Ltd. (supra) was noticed but not distinguished. The ratio of the said Supreme Court decision squarely applies in the present case for which I decline to interfere. For the same reason as above, I do not consider that the decision in Maula Bux (supra) would have any application here. The appeal before the Supreme Court arose out of a civil suit and not a writ petition and, therefore, the consideration for entertaining the claim was absolutely different. The writ petition, accordingly, stands dismissed. Parties shall bear their own costs. Nothing in this order shall preclude the petitioner to seek remedy by arbitration or before the competent civil court, as the case may be. The petitioner shall be entitled to claim similar benefit as is envisaged in Section 14 of the Limitation Act for the period the present petition remained pending before this Court. Urgent Photostat certified copy of the judgment and order shall be given to the applicants, if applied for, as early as possible.