JUDGMENT: (Per Hon’ble Sri Justice V.V.S.Rao) 1. The appellant in both the appeals is a company specialized in facilitation/execution of EPC contracts in the areas of power and infrastructure. The Andhra Pradesh State Electricity Board (APSEB) invited tenders from contractors for installation, commissioning and maintenance of 11 KV 2 MVAR Capacitor Bank System Units (CBSU) at various substations in Andhra Pradesh. The appellant was successful, and therefore, APSEB entered into lease contract agreement with the appellant for certain number of CBSUs. After the implementation of electricity reforms, Eastern Power Distribution Company Limited (EPDCL) – respondent in W.A.No.1152 of 2008, and the Northern Power Distribution Company Limited (NPDCL) – respondent in W.A.No.1187 of 2008, stepped into the shoes of APSEB and succeeded to the rights, duties and obligations under the contracts. To reduce the long story into a short one, the appellant’s bills for monthly operation lease rentals were paid up to August 2005. From September 2005 to September 2006 the lease rental bills were not paid. There was correspondence between the appellant and the concerned Superintendent Engineer (SE) on one hand and between the latter and the Chief General Manager (CGM) (Expenditure) on the other. Though initially the SE conducted scrutiny of the appellant’s bills and sent the same to CGM for necessary action, about four months thereafter the same SE informed the appellant that the lease rental bills of the appellant are returned by the corporate Office, Visakhapatnam, stating that, “payment cannot be made as the lessor has neither maintained the capacitor banks nor has attended for rectification of defective capacitor banks during the period from 09/2005 to 10/2006 as per the report of the Divisional Engineer, dated 10.11.2006”. Though not specifically informed by written communication, the NPDCL also did not release the lease rental bills. 2. Being aggrieved by the denial of payment of lease rental bills, the appellant filed W.P.No.6771 of 2007 against EPDCL and W.P.No.12436 of 2008 against NPDCL. In both of them, the appellant prayed for a writ of mandamus declaring the denial of the payment as illegal and arbitrary and for a consequential direction to the respondents to release the operational lease rental payments to the appellant in the bills processed by the SE. 3. In both of them, the appellant prayed for a writ of mandamus declaring the denial of the payment as illegal and arbitrary and for a consequential direction to the respondents to release the operational lease rental payments to the appellant in the bills processed by the SE. 3. Learned single Judge dismissed the writ petitions by a common order observing that there is dispute between the parties as to performance under the contract; the contract is not covered by statutory terms; the post-threshold dispute is contractual in nature, and therefore, the appropriate remedy for the appellant is to approach the civil Court. 4. In these appeals the Counsel for the appellant submits that after receiving the lease rental bills for the period from September 2005 to September 2006, the SE processed and after finding the claim to be correct forwarded the same to the CGM (Expenditure). But, the Corporate Office prevailed over the SE and made him to issue the letter raising all untenable objections. He would urge that during the period, no complaint was made against the maintenance/rectification work carried out by the appellant, and therefore, the turnaround is unjustified and arbitrary. 5. The contract for commissioning and maintenance of CBSUs with APSEB, and later with EPDCL and NPDCL is non-statutory contract. As found by the learned single Judge the contract between the parties does not provide for any payment schedules separately for installation, commissioning and maintenance. Subject to the term of contract, for the breach of any terms by one party, the other party to the contract may withhold the payments. When the respondents denied the payments for the period from September 2005 to September 2006 on the ground that the appellant did not maintain the CBSUs nor attended to rectification of defective Capacitor Banks, there is certainly a dispute regarding the discharge of mutual obligations. When there is a dispute with regard to the performance of contract, it would not be proper to draw an inference that the claim of the appellant has been admitted by the SE or for the matter in the respondent’s Corporate Office. Further, though the appellant sought for a declaration that the action of the respondents in denying payment of lease rental bills as illegal and arbitrary, ultimately it sought for a consequential direction to the respondents to make the payment. Further, though the appellant sought for a declaration that the action of the respondents in denying payment of lease rental bills as illegal and arbitrary, ultimately it sought for a consequential direction to the respondents to make the payment. It is, in effect, asking for a decree for payment of money. Such a writ petition, especially when there are disputed questions of fact with regard to discharge of mutual obligations under the contract, would not lie. 6. In Radhakrishna Agarwal v State of Bihar [1], dealing with the question of maintainability of a writ petition challenging the breach of contract between the citizen and the State, the Supreme Court held that a writ petition would not lie as no questions of Article 14 of Constitution of India would arise in the case of breach of contract. The Supreme Court pointed the following three types of breaches, where a writ petition would not lie in which event aggrieved party has to approach the Civil Court for damages for breach. (i) Where a petitioner makes a grievance of breach of promise on the part of the State in cases where on assurance or promise made by the State he has acted to his prejudice and predicament, but the agreement is short of a contract within the meaning of Article 299 of the Constitution; (ii) Where the contract entered into between the person aggrieved and the State is in exercise of a statutory power under certain Act or Rules framed thereunder and the petitioner alleges a breach on the part of the State; and (iii) Where the contract entered into between the State and the person aggrieved is non-statutory and purely contractual and the rights and liabilities of the parties are governed by the terms of the contract, and the petitioner complains about breach of such contract by the State. 7. In State of Uttar Pradesh v Bridge & Roof Company (India) Ltd., [2], the respondent was awarded a contract by the Government of Uttar Pradesh for the work of improvement of a road. After completion of the work, disputes arose about certain payments with regard to sales tax and price adjustment. The contractor approached the Commissioner of Sales Tax for reduction and composition of tax in terms of Section 7-D of U.P. Trade Tax Act, which appears to have been acceded. After completion of the work, disputes arose about certain payments with regard to sales tax and price adjustment. The contractor approached the Commissioner of Sales Tax for reduction and composition of tax in terms of Section 7-D of U.P. Trade Tax Act, which appears to have been acceded. But the concerned Deputy Commissioner ordered 1% tax deduction at source in view of Government Order with regard to composition scheme, which was valid up to 31.3.1995. Against this, the writ petition was filed. Allahabad High Court disposed of the writ petition directing to deduct only 1% of the bill up to 31.3.1995. The Supreme Court held that when the contract provides for arbitration, a writ petition would not lie, and observed thus. … 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, maybe, 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. 8. Kerala State Electricity Board v Kurien E. Kalathil [3] deals with features that distinguish non-statutory contract from that of a statutory one. Kerala State Electricity Board entered into agreement for construction of a dam. The agreement provided for payment of minimum wages fixed under the Minimum Wages Act, 1948. The contractor claimed compliance with the said condition. The Board stopped payment insofar as revised (escalated) minimum wages from January 1985. The contractor’s request to State Government was negatived ordering recovery. It was challenged before Kerala High Court seeking a direction to Board for payment of the amounts towards labour charges with interest. The contractor claimed compliance with the said condition. The Board stopped payment insofar as revised (escalated) minimum wages from January 1985. The contractor’s request to State Government was negatived ordering recovery. It was challenged before Kerala High Court seeking a direction to Board for payment of the amounts towards labour charges with interest. The same was allowed which was assailed before the Supreme Court inter alia on the ground that such dispute relating to interpretation of clause in a contract and implementation of such clause cannot be made subject matter of writ petition and that remedy of aggrieved person lies in approaching the Civil Court. The argument found acceptance by the Court and the Supreme Court held as follows. 9. The interpretation and implementation of a clause in a contract cannot be the subject matter of a writ petition. Whether the contract envisages actual payment or not is a question of construction of contract. If a term of a contract is violated, ordinarily the remedy is not the writ petition under Article 226. … … A contract would not become statutory simply because it is for construction of a public utility and it has been awarded by a statutory body. … … A statute may expressly or impliedly confer power on a statutory body to enter into contracts in order to enable it to discharge its functions. Dispute arising out of the terms of such contracts or alleged breaches have to be settled by the ordinary principles of law of contract. The fact that one of the parties to the agreement is a statutory or public body will not by itself affect the principles to be applied. The disputes about the meaning of a covenant in a contract or its enforceability have to be determined according to the usual principles of the Contract Act. Every act of a statutory body need not necessarily involve an exercise of statutory power. Statutory bodies, like private parties, have power to contract or deal with property. Such activities may not raise any issue of public law. In the present case, it has not been shown how the contract is statutory. The contract between the parties is in the realm of private law. It is not a statutory contract. Statutory bodies, like private parties, have power to contract or deal with property. Such activities may not raise any issue of public law. In the present case, it has not been shown how the contract is statutory. 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. Whether any amount is due and if so, how much and refusal of the appellant to pay it is justified or not, are not the matters which could have been agitated and decided in a writ petition. The contractor should have relegated to other remedies. (emphasis supplied) 10. If a person seeks payment of money from a private person, a suit for recovery of money would lie. If a person seeks payment of money towards refund of excess tax or charges for the work done or service given etc., from State or public authority, Writ Petition is not a proper remedy. The exercise of power of judicial review is subject to many limitations. If the case involves serious disputed questions of fact, ordinarily, the Court would refrain from adjudicating such issues. All claims for money invariably involve exercise of adjudication of questions of fact. Therefore, Writ Petition for refund of money or for that matter damages for breach of contract is ordinarily not maintainable. In a petition for damages relevant issues would be whether the respondent is guilty of dereliction of duty or guilty of negligence, whether the defence taken by the respondent like good faith, diligence etc., is sufficient to discharge respondent etc., are all matters involving production of acceptable evidence. In all situations and circumstances, the affidavit evidence would not be sufficient to arrive at definite conclusion even on balancing of probabilities. Therefore, over a period of time, the Courts, by and large, have taken the view that claim for money by way of writ petition is ordinarily not maintainable. 11. In all situations and circumstances, the affidavit evidence would not be sufficient to arrive at definite conclusion even on balancing of probabilities. Therefore, over a period of time, the Courts, by and large, have taken the view that claim for money by way of writ petition is ordinarily not maintainable. 11. In Suganmal v. State of Madhya Pradesh [4] a Constitution Bench of the Supreme Court considered the question whether a petition under Article 226 of the Constitution of India for refund of money collected by the State as tax, is maintainable. In the said case, the appellant was proprietor of Bhandari Iron and Steel Company, which had its foundry in Indore carrying on business of Mechanical Engineers, Iron, Brass and Malleable Iron founders and Re-rollers in Steel. Though it was not carrying on any business of cotton mill, it was called upon to pay industrial tax under Industrial Tax Act imposed on cotton mills. During the years 1941 to 1943, the authorities assessed the industrial tax payable by the appellant, and the amount was paid. The appeals filed by the appellant were decided in their favour holding that the appellant is not liable to pay industrial tax. The attempts of the appellant for refund of amount from the State Government proved unsuccessful and therefore a Writ Petition was filed before the High Court of Madhya Pradesh. The High Court dismissed the Writ Petition holding that Writ of Mandamus could not be issued for the purpose of refund of tax wrongly realised by the State. The Supreme Court affirmed the view and held that “normally, petitions solely praying for refund of money against State are not maintainable and that the aggrieved party has right to go to Civil Court where the State can raise all the defenses which cannot be raised in Writ Petition”. The relevant portion from the judgment reads as under. 12. The Supreme Court affirmed the view and held that “normally, petitions solely praying for refund of money against State are not maintainable and that the aggrieved party has right to go to Civil Court where the State can raise all the defenses which cannot be raised in Writ Petition”. The relevant portion from the judgment reads as under. 12. On the first point, we are of opinion that though the High Courts have power to pass any appropriate order in the exercise of the powers conferred under Art. 226 of the Constitution, such a petition solely praying for the issue of a writ of mandamus directing the State to refund the money is not ordinarily maintainable for the simple reason that a claim for such a refund can always be made in a suit against the authority, which had illegally collected the money as a tax. We have been referred to cases in which orders had been issued directing the State to refund taxes illegally collected, but all such cases had been those in which the petitions challenged the validity of the assessment and for consequential relief for the return of the tax illegally collected. We have not been referred to any case in which the Courts were moved by a petition under Art. 226 simply for the purpose of obtaining refund of money due from the State on account of its having made illegal exactions. We do not consider it proper to extend the principle justifying the consequential order directing the refund of amounts illegally realised, when the order under which the amounts had been collected has been set aside, to cases in which only orders for the refund of money are sought. The parties had the right to question the illegal assessment orders on the ground of their illegality or unconstitutionality and therefore, could take action under Art. 226 for the protection of their fundamental right, and the Courts, on setting aside the assessment orders, exercised their jurisdiction in proper circumstances to order the consequential relief for the refund of the tax illegally realised. We do not find any good reason to extend this principle, and therefore, hold that no petition for the issue of a writ of mandamus will be normally entertained for the purpose of merely ordering a refund of money to the return of which the petitioner claims a right. We do not find any good reason to extend this principle, and therefore, hold that no petition for the issue of a writ of mandamus will be normally entertained for the purpose of merely ordering a refund of money to the return of which the petitioner claims a right. U.P. Pollution Control Board v. Kanoria Industrial Ltd., [5] is also a case which involved the claim of respondent industry for refund of amount paid by them as water cess under the provisions of Water (Prevention and Control of Pollution) Cess Act, 1977. The High Court of Allahabad directed the U.P. Pollution Control Board to refund the sums realised from the respondent as water cess. Before the Supreme Court it was contended that a Mandamus could not be given for refund of the amount. After referring to various decisions on the point, including the decision in Suganmal, the apex Court observed as follows. ..…It is one thing to say that the High Court has no power under Article 226 of the Constitution to issue a writ of mandamus for making refund of the money illegally collected. It is yet another thing to say that such power can be exercised sparingly depending on facts and circumstances of each case. For instance, in the case on hand where facts are not in dispute, collection of money as cess was itself without the authority of law; no case of undue enrichment was made out and the amount of cess was paid under protest; the writ petitions were filed within a reasonable time from the date of the declaration that the law under which tax/cess was collected was unconstitutional. There is no good reason to deny a relief of refund to the citizens in such cases on the principles of public interest and equity in the light of the cases cited above. However, it must not be understood that in all cases where collection of cess, levy or tax is held to be unconstitutional or invalid, the refund should necessarily follow. We wish to add that even in cases where collection of cess, levy of tax is held to be unconstitutional or invalid, refund is not an automatic consequence but may be refused on several grounds depending on facts and circumstances of a given case. 12. We wish to add that even in cases where collection of cess, levy of tax is held to be unconstitutional or invalid, refund is not an automatic consequence but may be refused on several grounds depending on facts and circumstances of a given case. 12. In A.B.L.International Ltd. v. Export Credit Guarantee Corporation of India Ltd., [6] (supra), the Supreme Court again considered similar question and laid down as below. From the above discussion of ours, the 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 fact 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. 13. 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. And this plenary right of the High Court to issue a prerogative 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. 14. In view of the principles laid down by the Supreme Court though in appropriate cases it is always permissible for this Court to entertain claim for refund of money against State or instrumentality of the State, the Court will not normally exercise its prerogative jurisdiction to the exclusion of the other available remedies unless such action of the State is arbitrary and unreasonable so as to violate Article 14 of the Constitution of India. If reasonableness of the State action itself is a disputed question requiring elaborate evidence, the Court should refrain from entertaining Writ Petition for money claim. 15. In this case, the lease rental bills were submitted by the SE to the Corporate Office for necessary action. They were returned with two objections, namely, the appellant did not maintain CBSUs, and secondly, it has not attended to rectification of defective capacitor banks during the period from September 2005 to October 2006. If this is the alleged reason for withholding the bills, the question of breach of contract by the appellant would arise. It is a matter of evidence, and based on the affidavits, the issue cannot be decided. Therefore, we do not find any reason to interfere with the order of the learned single Judge, and the writ appeals are liable to be dismissed. We, however, observe that, if so advised, it is always open to the appellant to seek remedy in a civil Court. 16. The Writ Appeals, with the above observations, are accordingly dismissed.