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2014 DIGILAW 1472 (ALL)

Ratan Lal Bairagi v. State of U. P.

2014-05-06

D.Y.CHANDRACHUD, DILIP GUPTA

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JUDGMENT Hon'ble Dilip Gupta, J. The petitioner seeks payment of his dues in respect of the work which has allegedly been carried out under a tender for 2010-11 and in pursuance of certain work orders. 2. This is a purely contractual matter and we are not inclined to entertain a petition under Article 226 of the Constitution in this regard. Whether the work under the contract has been satisfactorily carried out and whether the rates quoted are in accordance with the terms of the agreement and the applicable schedule of rates are issues which have to be addressed, among other questions, by the competent authority before an appropriate decision is taken. The jurisdiction of the Court under Article 226 of the Constitution cannot appropriately be exercised in such matters. 3. In this regard, it would be useful to refer to the decision of the Supreme Court in Kerala State Electricity Board & Anr. Vs. Kurien E. Kalathil & Ors.1. The Supreme Court concluded that whether any amount is due under a contract is not a matter which can be agitated and decided in a writ petition since disputes arising out of the terms of a contract or alleged breach have to be settled by the ordinary principles of law of contract. The Supreme Court further observed that even if a Statute expressly or impliedly confers powers on a statutory body to enter into a contract in order to enable it to discharge its functions, such an activity will not raise any issue of public law. The contract between the parties would remain in the realm of private law and would not be a statutory contract. The observations are as follows: - "10 ................. Learned counsel has rightly questioned the maintainability of the writ petition. 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 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. 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. We are also unable to agree with the observations of the High Court that the contractor was seeking enforcement of a statutory contract. 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. We are also unable to agree with the observation of the High Court that since the obligations imposed by the contract on the contracting parties come within the purview of the Contract Act, that would not make the contract statutory. Clearly, the High Court fell into an error in coming to the conclusion that the contract in question was statutory in nature. 11. 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. 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." 4. In Hindustan Petroleum Corporation Limited & Anr. Vs. 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." 4. In Hindustan Petroleum Corporation Limited & Anr. Vs. Dolly Das, 2 , the Supreme Court also observed : - "In the absence of constitutional or statutory rights being involved a writ proceeding would not lie to enforce contractual obligations even if it is sought to be enforced against the State or to avoid contractual liability arising thereto. In the absence of any statutory right, Article 226 cannot be availed to claim any money in respect of breach of contract or tort or otherwise. .........." 5. In the present case, there is nothing on the record which may persuade us to hold that the contract is a statutory contract. The remedy of the contractor, if he is aggrieved by non-payment, would be to either file an ordinary civil suit or if there is an arbitration agreement between the parties, to invoke the terms of the agreement. 6. Recently, this Bench in M/s R.S. Associate Vs. State of U.P. & Ors.3 declined to entertain a petition which had been filed for making payment of bills under a contract. 7. Following the aforesaid decisions, we decline to entertain this petition. It is, accordingly, dismissed.