Abhay Ranjan Prasad Srivastava v. Chairman, Steel Authority of India Ltd. , New Delhi
2022-09-26
RAJESH SHANKAR
body2022
DigiLaw.ai
JUDGMENT : The present writ petition has been preferred for issuance of direction upon the respondent no. 4 - the Deputy Manager (Purchase), Purchase Department, Bokaro Steel Plant, Bokaro to make payment of admissible dues of Rs. 2,53,917/- along with statutory interest accrued till the date of payment against the Purchase Order No.4510031497 dated 06.05.2014 issued by the Purchase Department-Materials Management Division, Bokaro Steel Plant, Bokaro. 2. The factual background of the case as stated in the writ petition is that the petitioner being the proprietor of M/s. Crown Rubber Company (hereinafter referred to as “the supplier”), a Micro, Small & Medium Enterprises unit registered with National Small Scale Industries Corporation Limited (NSSICL) was issued purchase order no. P29/1004/4510031497 dated 06.05.2014. The petitioner submitted an application along with required certificate to get waiver of security deposit under the purchase & price preference policy of Government of India. However, the respondent no. 4 issued Risk Purchase Notice No. P29/1004/2014-15 dated 17.01.2015 to the petitioner claiming that it had committed breach of contract by not adhering to the terms & conditions of the said purchase order. The respondent no. 4 also issued recovery advice letter No. 1000011448 dated 10.04.2015 to the petitioner for depositing an amount of Rs.2,53,917.82 within 15 days from the date of issuance of the said letter and subsequently, the said amount was deducted against the purchase order no. 4510031497 dated 06.05.2014 from the bill of other contract of the petitioner, who thereafter repeatedly requested the respondent no. 4 for withdrawal of the said recovery advice by drawing his attention towards the necessary circulars issued by the Government of India, which were submitted by him before the authorities of the Bokaro Steel Plant for getting exemption of Bank Guarantee, but the same was not considered by them. The petitioner wrote letter to the respondent no. 3 - the Executive Director (MM), Bokaro Steel Plant, Bokaro on 16.07.2015 claiming refund of illegally deducted amount to the tune of Rs.2,53,917.82 towards ‘Risk Cost‘. The petitioner also requested in the said letter to either settle the claims amicably or refer the matter to a forum/independent arbitrator for conciliation/arbitration, however, no action was taken in this regard. 3. Learned counsel for the petitioner submits that the respondents have not followed the public procurement policy by not accepting the indemnity bond of the petitioner in place of Bank Guarantee.
3. Learned counsel for the petitioner submits that the respondents have not followed the public procurement policy by not accepting the indemnity bond of the petitioner in place of Bank Guarantee. It is further submitted that during supply of required material, the petitioner being a MSME unit submitted Indemnity Bond in place of Bank Guarantee of equivalent amount of old used rollers before lifting the old rollers for the allotted works such as, lifting of old used rubber lined rollers, removal of rubber from the surface and surface preparation for rubber lining, rectification of roll defects, final rubber lining of the rollers as per specifications given in the drawings as well as purchase order and dispatch the required material to BSL Stores properly packed to avoid transit damage, however, the authorities of the SAIL/Bokaro Steel Plant did not provide old rollers for the said work. Therefore, there was no question of supplying the material as per the terms and conditions of the purchase order. The petitioner could have been held liable only if the authorities of the Bokaro Steel Plant had provided old roll for ‘Roll Rubber Re-lining Works‘. Since SAIL/Bokaro Steel Plant Authority did not provide the same, the petitioner did not commit any breach of the terms and conditions of the said purchase order. The petitioner requested the respondent no. 3 vide letter dated 25.09.2015 for appointment of an independent arbitrator for resolution of dispute, but no action was taken by the said respondent. 4. It is further submitted that Delhi High Court in the case of “Delkon Textiles Private Limited Vs. Ministry of Railway & Ors.” [W.P.C No. 7704 of 2009] had directed the Railway authorities to implement the Government Circular dated 28.08.2000 giving benefits of waiver of security deposit to Small Scale Units (SSUs) while evaluating the bids submitted by SSUs in the tender floated by it up to the monetary limit for which the concerned unit was registered. 5. Per contra, learned counsel for the respondents submits that the petitioner supplied 20 numbers of relined rolls between May, 2016 and October, 2016, however, due to premature failure of 9 rolls, rectification/replacement notices were issued to the petitioner on 22.09.2016 (for 6 rolls) and 29.09.2016 (for 3 rolls).
5. Per contra, learned counsel for the respondents submits that the petitioner supplied 20 numbers of relined rolls between May, 2016 and October, 2016, however, due to premature failure of 9 rolls, rectification/replacement notices were issued to the petitioner on 22.09.2016 (for 6 rolls) and 29.09.2016 (for 3 rolls). As per the recovery advice dated 30.09.2016 and 12.10.2016 raised by the Inspection Department, Bokaro Steel Plant, Bokaro, an amount of Rs.1,59,467/- was recovered from the petitioner, who replaced 9 numbers of relined rolls on 19.01.2017 and 01.03.2017, however, the same again failed within 36 hours and the said fact was duly intimated to him. It is further submitted that the petitioner violated the terms and conditions of purchase order by not replacing the defective material with proper material within the Guarantee period. The deduction made from the other purchase order is justified and in consonance with the Standard Risk Purchase Procedure issued by SAIL, Corporate Materials Management Group, Delhi, vide Circular dated 25.08.2004. The NIT clearly stipulated that the supplier was to submit Bank Guarantee for the equivalent amount of old used rollers before lifting the old rollers for relining. The petitioner accepted the said terms and conditions and the purchase order was placed on the agreed terms and conditions, however, he violated the said terms and conditions by submitting Indemnity Bond in place of Bank Guarantee. It is also submitted that no exemption was granted to other BIADA vendors so far as the work of ‘relining of rolls‘ was concerned and they had submitted bank guarantees for equivalent amount of old used rollers before lifting the old rollers for relining. The petitioner was given opportunity to supply the materials by 31.01.2015, failing which the respondents had no option but to procure the material from alternative source under the risk purchase clause. The present writ petition is not maintainable as the request of the petitioner for appointment of Arbitrator was not accepted by the respondent-company. Otherwise also, such remedy was available with him under the provision of the Arbitration and Conciliation Act, 1996 and not by invoking Article 226 of the Constitution of India. 6. Heard the learned counsel for the parties and perused the materials available on record.
Otherwise also, such remedy was available with him under the provision of the Arbitration and Conciliation Act, 1996 and not by invoking Article 226 of the Constitution of India. 6. Heard the learned counsel for the parties and perused the materials available on record. The claim of the petitioner is that the respondents have not released the admissible dues amounting to Rs.2,53,917/- in his favour against the Purchase Order No.4510031497 dated 06.05.2014 and as such, they are liable to make payment of the said amount along with interest till the date of payment. 7. In the case of “Punjab National Bank & Ors. Vs. Atmanand Singh & Ors.” reported in (2020) 6 SCC 256 , the Hon‘ble Supreme Court after discussing several previous judicial pronouncements, has summarized the law with respect to the scope of intervention by the High Court under Article 226 of the Constitution of India in the matters involving money claim. The relevant paragraphs of the said judgment read as under: 19. The appellant-Bank has rightly invited our attention to the Constitution Bench decision of this Court in Thansingh Nathmal (supra). In paragraph 7, the Court dealt with the scope of jurisdiction of the High Court under Article 226 of the Constitution in the following words:— “7. … The jurisdiction of the High Court under Article 226 of the Constitution is couched in wide terms and the exercise thereof is not subject to any restrictions except the territorial restrictions which are expressly provided in the Articles. But the exercise of the jurisdiction is discretionary: it is not exercised merely because it is lawful to do so. The very amplitude of the jurisdiction demands that it will ordinarily be exercised subject to certain self-imposed limitations. Resort that jurisdiction is not intended as an alternative remedy for relief which may be obtained in a suit or other mode prescribed by statute. Ordinarily the Court will not entertain a petition for a writ under Article 226, where the petitioner has an alternative remedy, which without being unduly onerous, provides an equally efficacious remedy. Again the High Court does not generally enter upon a determination of questions which demand an elaborate examination of evidence to establish the right to enforce which the writ is claimed.
Again the High Court does not generally enter upon a determination of questions which demand an elaborate examination of evidence to establish the right to enforce which the writ is claimed. The High Court does not therefore act as a court of appeal against the decision of a court or tribunal, to correct errors of fact, and does not by assuming jurisdiction under Article 226 trench upon an alternative remedy provided by statute for obtaining relief. Where it is open to the aggrieved petitioner to move another tribunal, or even itself in another jurisdiction for obtaining redress in the manner provided by a statute, the High Court normally will not permit by entertaining a petition under Article 226 of the Constitution the machinery created under the statute to be bypassed, and will leave the party applying to it to seek resort to the machinery so set up. (emphasis supplied) 20. Similarly, another Constitution Bench decision in Suganmal (supra) dealt with the scope of jurisdiction under Article 226 of the Constitution. In paragraph 6 of the said decision, the Court observed thus:— “6. 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 Article 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 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.” (emphasis supplied) And again, in paragraph 9, the Court observed as follows:— “9. We therefore hold that normally petitions solely praying for the refund of money against the State by a writ of mandamus are not to be entertained.
We therefore hold that normally petitions solely praying for the refund of money against the State by a writ of mandamus are not to be entertained. The aggrieved party has the right of going to the civil court for claiming the amount and it is open to the State to raise all possible defences to the claim, defences which cannot, in most cases, be appropriately raised and considered in the exercise of writ jurisdiction.” (emphasis supplied) 21. In Smt. Gunwant Kaur (supra) relied upon by the respondent No. 1, in paragraph 14, the Court observed thus:— “14. The High Court observed that they will not determine disputed question of fact in a writ petition. But what facts were in dispute and what were admitted could only be determined after an affidavit in reply was filed by the State. The High Court, however, proceeded to dismiss the petition in limine. The High Court is not deprived of its jurisdiction to entertain a petition under Article 226 merely because in considering the petitioner's right to relief questions of fact may fall to be determined. In a petition under Article 226 the High Court has jurisdiction to try issues both of fact and law. Exercise of the jurisdiction is, it is true, discretionary, but the discretion must be exercised on sound judicial principles. When the petition raises questions of fact of a complex nature, which may for their determination require oral evidence to be taken, and on that account the High Court is of the view that the dispute may not appropriately be tried in a writ petition, the High Court may decline to try a petition. Rejection of a petition in limine will normally be justified, where the High Court is of the view that the petition is frivolous or because of the nature of the claim made dispute sought to be agitated, or that the petition against the party against whom relief is claimed is not maintainable or that the dispute raised thereby is such that it would be inappropriate to try it in the writ jurisdiction, or for analogous reasons.” (emphasis supplied) 22.
We restate the above position that when the petition raises questions of fact of complex nature, such as in the present case, which may for their determination require oral and documentary evidence to be produced and proved by the concerned party and also because the relief sought is merely for ordering a refund of money, the High Court should be loath in entertaining such writ petition and instead must relegate the parties to remedy of a civil suit. Had it been a case where material facts referred to in the writ petition are admitted facts or indisputable facts, the High Court may be justified in examining the claim of the writ petitioner on its own merits in accordance with law. 8. In the case of “Joshi Technologies International Inc. Vs. Union of India & Ors.” reported in (2015) 7 SCC 728 , the Hon‘ble Supreme Court has held thus: 69.3. If there are very serious disputed questions of fact which are of complex nature and require oral evidence for their determination. 69.4. Money claims per se particularly arising out of contractual obligations are normally not to be entertained except in exceptional circumstances. 9. In the aforesaid cases, the Hon‘ble Supreme Court has held that a writ petition cannot be maintained merely for the reason that refund of money is claimed by the petitioner against the State as the claim for money can always be made by filing a civil suit. When the refund of money is claimed by filing a writ petition and the question of facts as raised is so complex in nature which requires production of documents and leading of evidences, then in such eventuality, the High Court must relegate the parties to avail remedy of a civil suit. However, in case of admitted or indisputable facts in a writ petition, the High Court may grant relief to the petitioner of the concerned writ petition by examining the case on its own merits. 10. In the case in hand, the respondents have not admitted the dues as claimed by the petitioner, rather have contended that the petitioner - supplier had failed to supply the material as per the terms and conditions of the purchase order.
10. In the case in hand, the respondents have not admitted the dues as claimed by the petitioner, rather have contended that the petitioner - supplier had failed to supply the material as per the terms and conditions of the purchase order. The petitioner, however, in support of his claim for refund of the amount, has contended that as per the terms of the contract as well as the circulars issued by the Government of India, he was entitled for exemption from submitting Bank Guarantee as security deposit for lifting the materials. 11. I am of the view that the claim and counter claim made by both the parties can effectively be adjudicated by a fact finding authority and not by this Court under Article 226 of the Constitution of India. It appears from the nature of the dispute that the amount so claimed by the petitioner is not an admitted one and thus the present writ petition in the nature of money claim is not maintainable. The petitioner has also contended that the respondents did not accept his request to refer the dispute for arbitration. Even if the said contention of the petitioner is accepted, he had the right to take recourse of the Act, 1996 seeking appointment of an Arbitrator, however, he failed to avail the same. 12. Considering the nature of dispute, this Court is of the view that the present writ petition is not maintainable and the same is accordingly dismissed. The petitioner is, however, at liberty to take alternative recourse for redressal of his grievance as available under law, if so advised.