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2021 DIGILAW 1173 (KER)

Baiju E. R. , S/o Ravi v. State Of Kerala

2021-12-22

N.NAGARESH

body2021
JUDGMENT : The petitioner, who is a Contractor and who entered into agreement with the 6th respondent to carry out an agreed work, is aggrieved by the refusal of the respondents in making payment on his Bills. 2. On 02.03.2020, the petitioner executed Ext.P5 agreement with the 6th respondent-District Nirmithi Kendra for removal, segregation and transportation of silt and debris accumulated on the Periyar River banks. The silt/debris was intended for sale by the 6th respondent. The petitioner procured machinery and installed plant. About 150 loads of sand were processed and made ready for sale. The intention was to sell sand to the State and credit the sale proceeds to the River Management Fund (RMF). 3. The 6th respondent dropped the project in the midway. The petitioner requested to pay the amounts for the work already carried out, but no payment was made. The petitioner states that he has made huge investments after entering into contract, to carry out the work. Machinery was procured and installed, taking advances from private financial sources. Unless the petitioner is permitted to complete the work and unless the petitioner is paid for the work, he will be financially ruined. 4. The 3rd respondent resisted the writ petition. The 3rd respondent stated that the Government empowered all District Collectors to remove the debris accumulated in the rivers and its shores in the devastating flood in 2018 and 2019 vide order G.O.(RT) No.3880/2019/RD dated 24.12.2019. The District Collector, Idukki authorised District Nirmithi Kendra to remove the sand and debris accumulated in the Periyar and its various tributaries flowing through Idukki District. It seems that Nirmithi Kendra has given sub contract to the petitioner for the above works. 5. Later, Project Engineer of Idukki District Nirmithi Kendra stated in a meeting convened on 11.05.2020 by the District Collector that the work of removal of sand and debris is in progress and about hundred loads of sand is ready for sale which has been accumulated due to the flood in the area of Thattekkani of Kanjikuzhy Village. The Divisional Forest Officer, Munnar made an objection to this work saying that the area from which the debris has been removed belongs to Forest Department. The Divisional Forest Officer, Munnar made an objection to this work saying that the area from which the debris has been removed belongs to Forest Department. He stated that the sand which is deposited, has come from the Periyar river and the land as well as the Periyar river flowing along the boundary of land are part of reserve forest and the sand which is a forest produce coming from the reserve forest, cannot be sold. So, the work was abruptly stopped. 6. In a meeting presided by Officer on Special Duty for Chief Secretary, the following decisions were taken: (a) The Forest Department is the authority to remove the sand from the property of Sri.Jolly Paily as the 0.9106 hectares of land in Block 47 of Kanjikuzhy Village allotted to the petitioner on 22.08.2015 as per the Kerala Land Assignment (Regularisation of Occupation of Forest land prior to 01.01.1977) (Special Rules 1993) comes under reserve forest status. (b) The Revenue Department shall verify whether the land, where the debris accumulated is in the land to which Patta was issued to Jolly Paily on 22.08.2015. This shall be done within a period of two weeks. (c) On demarcation of the land by Revenue Department, if it is confirmed that the sand is accumulated in the Patta land, the Forest Department should take steps to remove the sand. (d) The Revenue Department should verify the details of land to which Pattas were issued so far, out of 180 hectares of land approved by the Union Ministry of Forest etc. The Tahsildar, Idukki, vide its letter No.D2/11018/18 dated 23.02.2021, has informed that debris/sand was accumulated in the patta property of the petitioner. But, the Forest Department objected the authenticity of the survey. 7. The District Nirmithi Kendra had given sub contract to the petitioner to remove the sand and prepare it to ready for sale and the work has been started. The Forest Department objected this and the work was stopped abruptly. The unexpected stopping of the work was due to intervention of the Forest Department. The petitioner submitted an application to the 3rd respondent to direct the District Nirmithi Kendra to release the fund for the work which he already completed. The application has been forwarded to District Nirmithi Kendra for report. The District Nirmithi Kendra has reported that they have made an agreement with the petitioner. The petitioner submitted an application to the 3rd respondent to direct the District Nirmithi Kendra to release the fund for the work which he already completed. The application has been forwarded to District Nirmithi Kendra for report. The District Nirmithi Kendra has reported that they have made an agreement with the petitioner. In this agreement, it is clearly stated that the amount will be transferred to the petitioner only after arriving the amount in their account through sale of sand. 8. The 6th respondent filed a counter affidavit. The learned counsel for the 6th respondent strongly opposed the writ petition and denied any liability to the petitioner for the reason that the agreement contemplated payment to the petitioner only when amounts are received from the Government. The 6th respondent has to get altogether Rs.14 lakhs from the Government. Therefore, the writ petition is liable to be dismissed as against the 6th respondent, without prejudice to the right of the 6th respondent to get Rs.14 lakhs from the Government. 9. I have heard Sri. George Mathew, the counsel for the petitioner, Smt. Princy Xavier, the Senior Government Pleader representing respondents 1 to 5 and Sri. C.Rajendran and Smt. R.S. Sree Vidya, counsel representing the 6th respondent. 10. Ext.P5 is the agreement dated 02.03.2020 between the petitioner and Idukki District Nirmithi Kendra for removal, segregation and transportation of silt and debris from the banks of Periyar River. Clause 20 of Ext.P5 agreement provides that the petitioner will be paid only after sale of sand and when the sale amount is credited to the account of the 6th respondent. Ext.P11 minutes of the meeting conducted by the District Collector on 11.05.2020 would indicate that about 100 loads of sand were processed by the 6th respondent and is ready for sale. Obviously, the processing was carried out by the petitioner at the instance of the 6th respondent. 11. Problem arose when the Department of Forests, Government of Kerala interfered in the matter and claimed that the silt/debris/sand accumulated on the riverbed is forest produce and can be removed or sold only by the Forest Department. When it was pointed out that the sand removed and processed by the petitioner was deposited in a Patta Land, the Forest Officials even objected to the authenticity of the Survey. 12. When it was pointed out that the sand removed and processed by the petitioner was deposited in a Patta Land, the Forest Officials even objected to the authenticity of the Survey. 12. Respondents 1 to 5 have not sold the sand and no amount is credited to the account of the 6th respondent, are facts which are not disputed. The sale could not take place due to the dispute between two Government Departments over the ownership of the sand. If that is the case, whether the petitioner can be denied payment relying on Clause 20 of Ext.P5 agreement ? 13. By Ext.P1 Government Order dated 27.09.2018, the Government of Kerala has authorised the District Collectors to remove silt and debris accumulated after 2018 Floods, to segregate and sell sand and deposit the sale proceeds in the River Management Fund. The District Collectors were required to exercise the powers of District Magistrates for this purpose. It is on the basis of such authorisation that the 6th respondent was assigned the work, which the 6th respondent started to execute through the petitioner. The sand processed by the petitioner could not be sold due to the intervention and claim of another Government Department, namely Department of Forests. 14. Under the circumstances, the respondents will not be justified from denying payment to the petitioner, placing reliance on Clause 20 of Ext.P5. Firstly, the decision of the respondents to remove silt and debris from the river banks engaging the 6th respondent as the Agency for such removal, was on the basis of Ext.P1 Government Order dated 27.09.2018, wherein the District Collectors were required to execute the Government decision in exercise of the powers of District Magistrates under the Code of Criminal Procedure, 1973. When a District Magistrate duly appointed under Section 20 of the Code of Criminal Procedure exercises his powers as Head of District Executive, all Government Departments are bound by such decision and no Government Department can raise objections to such exercise of power. 15. In this case, the decision of the Government to be executed by the District Magistrate, is to remove silt/debris, segregate the same utilising the RMF, keep it under the custody of District Magistrate, sell the same to the categories prescribed therein and credit the sale proceeds to the RMF. 15. In this case, the decision of the Government to be executed by the District Magistrate, is to remove silt/debris, segregate the same utilising the RMF, keep it under the custody of District Magistrate, sell the same to the categories prescribed therein and credit the sale proceeds to the RMF. Therefore, the District Administration has to pay the amounts required for such removal and segregation from the RMF and the amount received from sale of sand should be credited to RMF. The decision so taken is by the State Government and execution of the decision is invoking the powers of the District Magistrate under the Code of Criminal Procedure. The Department of Forest, which is only one arm of the Government, cannot be heard to contend that the accumulated river sand is a forest produce and only the Forest Department has right over the sand. The Department of Forest is an integral part of the Government and is bound by Ext.P1 Government Order, which has been issued by order of the Governor. 16. As regards the defence that Clause 20 of Ext.P5 agreement would disentitle the petitioner from claiming payment till amount is credited to the account of the 6th respondent, such a condition has been stipulated to substitute a fixed schedule for payment of contractual dues to the petitioner. Such a condition cannot be one stipulated to deny contractual dues to the petitioner for an indefinite period. Such an interpretation would render the clause unconscionable term of contract, frowned upon by the Hon’ble Apex Court in Central Inland Water Transport Corporation Limited and another v. Brojo Nath Ganguly and another [ AIR 1986 SC 1571 ]. 17. For all the aforementioned reasons, the petitioner is entitled to relief in this writ petition. The 6th respondent is directed to process the Bills of the petitioner for works done pursuant to Ext.P5 agreement forthwith and claim the amounts from respondents 2 and 3 within two weeks, if such claim is not already made. Respondents 2 and 3 shall transfer to the 6th respondent’s account the amounts found due to the petitioner, from the River Management Fund within a further period of four weeks. The 6th respondent shall pay to the petitioner, the amounts found due immediately on receipt of payment. All other claims of the parties and issues arising, are left open. Writ petition is disposed of as above.