Abu K. S. , S/o. N. K. Sivadas v. Ravancore Devaswom Board – TDB Represented By Its Secretary
2022-02-09
ANIL K.NARENDRAN, P.G.AJITHKUMAR
body2022
DigiLaw.ai
JUDGMENT : Anil K. Narendran, J. The petitioner participated in the auction conducted by the Estate Division of the Travancore Devaswom Board for running Aymanam Sri. Narasimhaswami Auditorium (Sadyalayam) under Kottayam Group, for the period from 01.08.2019 to 31.07.2021. He bid auction for an amount of Rs.2,41,000/-. In terms of the tender conditions, the petitioner paid 50% of the auction amount on 18.07.2019, the date of auction itself, as evidenced by Ext.P1 receipt. The petitioner has defaulted payment of the balance auction amount of Rs.1,20,500/-. The petitioner has filed this writ petition, under Article 226 of the Constitution of India, seeking a writ of mandamus commanding the 1st respondent Travancore Devaswom Board to consider Ext.P2 representation dated 05.01.2022, and a writ of mandamus commanding the respondents not to evict him from the premises, which is in his possession pursuant to the remittance made in Ext.P1 receipt. 2. On 21.01.2022, when this writ petition came up for admission, the learned Standing Counsel for Travancore Devaswom Board sought time to file statement. On 01.02.2022, when this writ petition came up for consideration, this Court passed the following order; “The petitioner participated in the auction conducted by the Travancore Devaswom Board for running Aymanam Sri. Narasimhaswami Auditorium (Sadyalayam) in Aymanam Sri. Narasimhaswami Temple, in Kottayam district, for the period from 01.08.2019 to 31.07.2021. The auction was for an amount of Rs.2,41,000/-. The petitioner remitted half of the auction amount, i.e., Rs.1,20,500 on 18.07.2019, as evidenced by Ext.P1 receipt. Thereafter, the petitioner defaulted remittance of the balance instalment amounting to Rs.1,20,500/-. Though the period of contract was only upto 31.07.2021, the petitioner, who is a defaulter, is still in possession of the Sadyalayam. The learned Standing Counsel for Travancore Devaswom Board would submit that the petitioner has not even cleared the electricity charges. List on 03.02.2022 for further consideration. Affidavit of the 4th respondent Assistant Devaswom Commissioner and that of the 5th respondent Sub Group Officer explaining the facts and circumstances in which the petitioner, who is a defaulter, was permitted to occupy Sadyalayam, even after 31.07.2021, shall be placed on record before the next posting date. Respondents 4 and 5 shall forthwith take over possession of Aymanam Sri. Narasimhaswami Auditorium (Sadyalayam), if found necessary, with police assistance. If any such request is made, the concerned Station House Officer shall render necessary assistance.” 3.
Respondents 4 and 5 shall forthwith take over possession of Aymanam Sri. Narasimhaswami Auditorium (Sadyalayam), if found necessary, with police assistance. If any such request is made, the concerned Station House Officer shall render necessary assistance.” 3. Pursuant to the directions contained in the aforesaid order, individual affidavits have been filed by respondents 4 and 5. On 03.02.2022, when this writ petition came up for consideration, the learned counsel for the petitioner submitted that the petitioner has already cleared the entire electricity dues of the ‘Sadyalayam’ and possession of the ‘Sadyalayam’ has already been handed over to the 5th respondent Sub Group Officer on 01.02.2022 itself. 4. Heard learned counsel for the petitioner and also the learned Standing Counsel for Travancore Devaswom Board. 5. Going by the averments in the writ petition, petitioner is the successful bidder for running Aymanam Sri. Narasimhaswami Auditorium (Sadyalayam) in Aymanam Sri. Narasimhaswami Temple, for the period from 01.08.2019 to 31.07.2021. In terms of the tender conditions, the petitioner has remitted 50% of the auction amount on the date of confirmation itself, i.e., 18.07.2019, as evidenced by Ext.P1. The petitioner defaulted payment of the balance amount. According to the petitioner, on account of the restrictions imposed in connection with Covid-19 pandemic, ‘Sadyalayam’ could not be rented out to public for conduct of marriage functions, etc., and it remained closed for six months from the date of handing over the premises to the petitioner. The petitioner has also got a case that he had undertaken certain miscellaneous repair works spending Rs.50,000/-out of his pocket. On 05.01.2022, much after the expiry of the period of auction, petitioner submitted Ext.P2 representation before the st respondent Board, seeking time to pay the balance auction amount. Thereafter, the petitioner moved this writ petition before this Court, on 20.01.2022, seeking the aforementioned reliefs. 6. From the affidavit filed by respondents 4 and 5, it is seen that the 4th respondent Assistant Devaswom Commissioner has issued several orders to the 5th respondent Sub Group Officer, to collect the balance auction amount from the petitioner. Though the 5th respondent issued notice to the petitioner, requiring him to remit the balance amount, he did not remit the same. The petitioner gave a request seeking extension of time for paying the balance amount and that request was forwarded by the 4th respondent to the 5th respondent, along with a report dated 05.04.2021.
Though the 5th respondent issued notice to the petitioner, requiring him to remit the balance amount, he did not remit the same. The petitioner gave a request seeking extension of time for paying the balance amount and that request was forwarded by the 4th respondent to the 5th respondent, along with a report dated 05.04.2021. The request of the petitioner along with the report of the Sub Group Officer was forwarded to the 3rd respondent on 24.01.2021 with Report No.156. In the affidavit filed by the 4th respondent it is stated that the petitioner has defaulted payment of electricity charges in respect of the ‘Sadyalayam’ and hence, the 5th respondent required the petitioner to remit the pending electricity charges and the balance amount and to surrender the key. The petitioner informed the 5th respondent that he was expecting an order from the Board to conduct ‘Sadyalayam’ for a further period of two years and reduction in the balance amount and delayed the surrender of the key. On 01.02.2022, the petitioner remitted the electricity dues and surrendered the key of ‘Sadyalayam’ to the 5th respondent. The balance amount payable is not remitted so far. In the affidavit, it is stated that, the petitioner is also liable to pay the proportionate amount upto 01.02.2022, with 18% interest. The steps to auction the right to conduct ‘Sadyalayam’ is taken by the Estate Division of the Board. 7. The affidavit filed by the 5th respondent Sub Group Officer also discloses the state of affairs similar to that stated in the affidavit filed by the 4th respondent. As already noticed hereinbefore, the petitioner is the successful bidder for running Aymanam Sri. Narasimhaswami Auditorium (Sadyalayam) in Aymanam Sri. Narasimhaswami Temple, for the period from 01.08.2019 to 31.07.2021, for an amount of Rs.2,41,000/-. The ‘Sadyalayam’ in question has been constructed by the Travanacore Devaswom Board spending several lakhs. The period of auction is two years. When the petitioner bid the auction for a sum of Rs.2,41,000/-, his liability or his financial burden comes to Rs.10,000/-for a period of one month. Therefore, the petitioner, who is the successful bidder of that ‘Kuthaka’ item, was in occupation of the ‘Sadyalayam’ with a financial burden of Rs.10,000/-per month.
The period of auction is two years. When the petitioner bid the auction for a sum of Rs.2,41,000/-, his liability or his financial burden comes to Rs.10,000/-for a period of one month. Therefore, the petitioner, who is the successful bidder of that ‘Kuthaka’ item, was in occupation of the ‘Sadyalayam’ with a financial burden of Rs.10,000/-per month. In the writ petition, the case of the petitioner is that, since no marriage functions could be conducted in the ‘Sadyalayam’ for nearly six months, he could not remit the balance auction amount. If any marriage functions, receptions or any other functions are conducted in the ‘Sadyalayam’ for minimum five days, he would get a higher amount than his financial commitment. Even in such scenario, the petitioner has defaulted payment of the auction amount. The Officers of the Board, especially respondents 4 and 5, who have a duty to see that the bidders of ‘Kuthaka’ items are not defaulting payment of the auction amount, have not taken any earnest efforts to report illegal occupation of the petitioner to the concerned officer in the Devaswom Estate Division or to the 3rd respondent Devaswom Commissioner. It is also an admitted fact that the petitioner has even defaulted payment of electricity charges. Therefore, this is a case in which the concerned officials of the Travancore Devaswom Board has permitted the petitioner to occupy the premises in question in violation of the tender conditions. They have not even taken any action to see that the defaulted auction amount is recovered from the petitioner at proper stage, by initiating recovery proceedings. 8. The petitioner submitted Ext.P2 representation dated 05.01.2022 before the 1st respondent Board, after the expiry of the term of the contract. From the affidavit filed by respondents 4 and 5, it is seen that, the petitioner, who has defaulted payment of the balance auction amount, did not pay the electricity charges. He submitted Ext.P2 representation before the 1st respondent through the 5th respondent Sub Group Officer, who has forwarded the same to the 3rd respondent Devaswom Commissioner along with a report dated 05.04.2021. Even after receipt of such a representation, the 3rd respondent Devaswom Commissioner has not taken any steps to ensure that the petitioner, who is the defaulter of the balance auction amount, is not permitted to occupy 'Sadyalayam' without remitting the said amount and also the electricity charges.
Even after receipt of such a representation, the 3rd respondent Devaswom Commissioner has not taken any steps to ensure that the petitioner, who is the defaulter of the balance auction amount, is not permitted to occupy 'Sadyalayam' without remitting the said amount and also the electricity charges. The 4th respondent Assistant Devaswom Commissioner and the 5th respondent Sub Group Officer have permitted the petitioner to occupy the premises, on the ground that the report dated 05.04.2021 of the 5th respondent on Ext.P2 representation made by the petitioner is pending consideration before the 3rd respondent. 9. The learned counsel for the petitioner would submit that the petitioner is pressing mainly the first relief sought for in this writ petition, i.e., a writ of mandamus commanding the 1st respondent Travancore Devaswom Board to consider Ext.P2 representation dated 05.01.2022 made by him. The relief sought for in that representation is an order granting two years' time to the petitioner to remit the balance auction amount and also the electricity dues of 'Sadyalayam'. The further relief sought for in that representation is an order permitting the petitioner to occupy 'Sadyalayam' for a further period of two years on reduced rate, considering the situation prevailing in the State on account of Covid-19 pandemic. 10. In Bihar Eastern Gangetic Fishermen Cooperative Society Ltd. v. Sipahi Singh [ (1977) 4 SCC 145 ], a Three-Judge Bench of the Apex Court held that a writ of mandamus can be granted only in a case where there is a statutory duty imposed upon the officer concerned and there is a failure on the part of that officer to discharge the statutory obligation. The chief function of a writ is to compel performance of public duties prescribed by statute and to keep subordinate tribunals and officers exercising public functions within the limit of their jurisdiction. 11. In Oriental Bank of Commerce v. Sunder Lal Jain [ (2008) 2 SCC 280 ] the Apex Court held that in order that a writ of mandamus may be issued, there must be a legal right with the party asking for the writ to compel the performance of some statutory duty cast upon the authorities. In the said decision, the Apex Court noticed that the principles on which a writ of mandamus can be issued have been stated in 'The Law of Extraordinary Legal Remedies' by F. G. Ferris and F. G. Ferris, Jr.
In the said decision, the Apex Court noticed that the principles on which a writ of mandamus can be issued have been stated in 'The Law of Extraordinary Legal Remedies' by F. G. Ferris and F. G. Ferris, Jr. that, mandamus is, subject to the exercise of a sound judicial discretion, the appropriate remedy to enforce a plain, positive, specific and ministerial duty presently existing and imposed by law upon officers and others who refuse or neglect to perform such duty, when there is no other adequate and specific legal remedy and without which there would be a failure of justice. 12. In State of U.P. v. Harish Chandra [ (1996) 9 SCC 309 ] the Apex Court held that under the Constitution a mandamus can be issued by the Court when the applicant establishes that he has a legal right to performance of legal duty by the party against whom the mandamus is sought and said right was subsisting on the date of the petition. The duty that may be enjoined by mandamus may be one imposed by the Constitution or a Statute or by Rules or orders having the force of law. But no mandamus can be issued to direct the Government to refrain from enforcing the provisions of law or to do something which is contrary to law. 13. In Bhaskara Rao A.B. v. CBI [ (2011) 10 SCC 259 ] the Apex Court reiterated that, generally, no court has competence to issue a direction contrary to law nor can the Court direct an authority to act in contravention of the statutory provisions. The Courts are meant to enforce the rule of law and not to pass the orders or directions which are contrary to what has been injected by law. 14. In the instant case, in violation of the tender conditions, the petitioner has defaulted payment of the balance auction amount and also the electricity dues of 'Sadyalayam' for the period from 01.08.2019 to 31.07.2021. Respondents 4 and 5 have permitted the petitioner to occupy 'Sadyalayam' and generate income, despite the fact that he has defaulted payment of amounts legally due to the 1st respondent Board and also the electricity dues payable to the Kerala State Electricity Board. As already noticed hereinbefore, the petitioner submitted Ext.P2 representation before the 1st respondent much after the expiry of the period of auction.
As already noticed hereinbefore, the petitioner submitted Ext.P2 representation before the 1st respondent much after the expiry of the period of auction. The said period expired on 31.07.2021 and submission of Ext.P2 representation by the petitioner was nearly five months after the expiry of that period. The petitioner, who is a defaulter, cannot seek a writ of mandamus commanding the 1st respondent to consider Ext.P2 representation, since the request made in that representation is for two years' time to pay the balance auction amount and the electricity dues and also a further request to permit him to occupy 'Sadyalayam' for a period of two years on reduced rate. In view of the law laid down in the decisions referred to supra, no mandamus can be issued directing the 1st respondent to do something which is contrary to law and as such the petitioner is not entitled for a writ of mandamus commanding the 1st respondent to consider his request in Ext.P2 representation. 15. Another relief sought for in this writ petition is a writ of mandamus commanding the respondents not to evict the petitioner from the premises, which is in his possession pursuant to the remittance made in Ext.P1 receipt dated 18.07.2019. Such a relief is sought for on the ground that the petitioner had to close down ‘Sadyalayam’ for a period of six months out of the total period of two years, on account of the restrictions imposed in connection with Covid-19 pandemic. 16. In Suresan Nair T.S. and others v. Travancore Devaswom Board and others [ 2021 (6) KHC 837 ] a Division Bench of this Court held that, when the petitioners therein responded to Ext.P1 tender notification issued by the Travancore Devaswom Board by submitting their respective bids for their respective items, they made their offer and the same was accepted by the Travancore Devaswom Board and they were conferred with the kuthaka/right. Thereupon, they remitted the first instalment of the bid amount as per the terms of Ext.P1 and the contract between the petitioners and the Travancore Devaswom Board is completed. The prescription in clause (7) for execution of formal agreement within seven days from the date of conferring with the kuthaka/right is only for embodying the terms and conditions of the contract already concluded by the acceptance of the bid.
The prescription in clause (7) for execution of formal agreement within seven days from the date of conferring with the kuthaka/right is only for embodying the terms and conditions of the contract already concluded by the acceptance of the bid. Absence of a formal contract cannot lead to an inference that there is no concluded contract when the contract is completed by the acceptance of bid and deposit of the requisite portion of bid amount by the petitioners. 17. In Suresan Nair T.S., relying on the decision of the Apex Court in Dresser Rand S.A. v. Bindal Agro Chemicals Ltd. [ (2006) 1 SCC 751 ] the petitioners therein contended that, in the absence of a written agreement between parties, there is no binding contract. The Division Bench noticed that, in Dresser Rand S.A., the Apex Court was considering the question as to whether a tender document can be construed as arbitration agreement and the Court, after considering the difference between negotiating a bargain and entering into a binding contract held, on the facts of the said case, that unless a purchase order was placed, there would be no agreement between the parties. Everything that took place before such purchase order was placed, would only be a prelude to a contract which cannot be confused with the contract itself. It was further held that a letter of intent is only an intention to enter into a contract in future and it is not binding on the parties and it does not amount to contract. The process of bidding or submission of tenders would result in a contract when a bid or offer is made by a prospective supplier and such bid or offer is accepted. The Division Bench held that, the decision of the Apex Court in Dresser Rand S.A. cannot fetch any help to the petitioners, as admittedly, the bids submitted by them were accepted by the TDB and they have remitted the 1st instalment of the premium amount. It is not merely a negotiation of bargain, but acceptance of petitioners' bids by the Travancore Devaswom Board, giving rise to a binding contract. Therefore, absence of a formal agreement cannot lead to an inference that there is no binding contract between the petitioners and the Travancore Devaswom Board. 18.
It is not merely a negotiation of bargain, but acceptance of petitioners' bids by the Travancore Devaswom Board, giving rise to a binding contract. Therefore, absence of a formal agreement cannot lead to an inference that there is no binding contract between the petitioners and the Travancore Devaswom Board. 18. In Suresan Nair T.S., the Division Bench noticed that, as per Ext.P1 tender notification, once the kuthaka right is received, an agreement in stamp paper as per the approved draft shall be entered into within seven days at the office of the Devaswom concerned. Once the grant of kuthaka is informed and the person who received kuthaka remits the first instalment of the kuthaka, he is bound to scrupulously follow the other conditions in the tender notification and execute the agreement within the stipulated time. Having not done the same, he cannot be permitted to take advantage of avoidance of that obligation and get the fruits of his refusal to honour the obligation. By refusing to enter into an agreement and taking advantage of the same, the petitioners cannot be heard to contend that there is no concluded contract and they are not liable to pay the auction amount. It is trite that, where an obligation is cast on a party and he commits a breach of such obligation, he cannot be permitted to take advantage of such situation. This is based on the Latin maxim 'commodum ex injuria sua nemo habere debet' (no party can take undue advantage of his own wrong). Therefore, the Division Bench held that, the petitioners cannot contend that there is no binding contract between the petitioners and the Travancore Devaswom Board or that the tenders are liable to be cancelled. Their contention that they are not liable to deposit the bid amount and that they are entitled to get back the amount already deposited cannot be sustained. 19. In Harikumar G. v. Travancore Devaswom Board and others [ILR 2021 (1) Kerala 1050] a Division Bench of this Court was dealing with a case in which extension of licence period for selling pooja items in Ettumanoor Sree Mahadeva Temple was sought for in the background of Covid-19 pandemic. While declining the said prayer, the Division Bench noticed that, even the petitioner has not shown that the supervening events have struck at the root of the contract.
While declining the said prayer, the Division Bench noticed that, even the petitioner has not shown that the supervening events have struck at the root of the contract. In other words, it has not become humanly impossible to perform the contract. Even though for some time in the beginning, it had become more onerous to get returns as expected by him, after lifting the ban in entering of devotees in temple, devotees have resumed visiting the temple and thus the petitioner has started supplying materials as required under the contract. After starting to supply materials, he cannot turn round and say that the contract has become impossible of performance and frustrated. Paragraphs 8 to 10 of that decision read thus; “8. Doctrine of frustration or otherwise known as doctrine of impossibility is based on the legal provision for the discharge of a contract, subsequent to its formation, in the event of change of circumstances rendering the contract illegal or physically impossible of performance. 'Impossibilium nulla obligatio est' is an accepted Latin Maxim meaning that there is no obligation to do impossible things. Similarly, the scope of application of the doctrine of 'lex non cogit ad impossibilia', that is, the law does not compel a man to do what he cannot possibly perform, the Roman Maxim 'nemo tenetur ad impossibilia', no one is bound to do an impossibility, have no application in the fact situation. Here no one has a case that the first part of Section 56 has any application. The petitioner wanted to bring his case under the second part, saying that due to supervening reasons, that is, introduction of complete lockdown due to the spread of Covid-19 pandemic, it became impossible for him to perform his part of the contract and thus the contract stands frustrated. We have no doubt that on his own showing, it is brought out by the petitioner that the second part of Section 56 also has no application. It is evident that from 17.08.2020 onwards, he could do business. The term of the contract is up to 31.03.2021. If it was an absolute impossibility, he would not have been able to perform the contract and supply items as required under the terms of the contract. Therefore, the petitioner cannot take shelter under Section 56 of the Contract Act.
It is evident that from 17.08.2020 onwards, he could do business. The term of the contract is up to 31.03.2021. If it was an absolute impossibility, he would not have been able to perform the contract and supply items as required under the terms of the contract. Therefore, the petitioner cannot take shelter under Section 56 of the Contract Act. For the very same reason, his argument that he has suffered a huge loss of Rs.30 lakhs a month also cannot be looked into by the Court. 9. It is also important to consider the effect of impossibility or frustration. When there is frustration, the dissolution of the contract occurs automatically. It does not depend, as happens in rescission of a contract on the ground of repudiation or breach, on the choice of election of either party. It depends on the effect of what has actually happened on the possibility of performing the contract. 10. In Smt. Sushila Devi and another v. Hari Singh and others [ AIR 1971 SC 1756 ] the Honourable Supreme Court held that Section 56 of the Contract Act lays down a rule of positive law and does not leave the matter to be determined according to the intention of the parties. The impossibility contemplated by Section 56 of the Contract Act is not confined to something which is not humanly possible. If the performance of a contract becomes impracticable or useless having regard to the object and purpose of the parties had in view then it must be held that the performance of the contract has become impossible. But the supervening events should take away the basis of the contract and it should be of such a character that it strikes at the root of the contract. As noticed, here even the petitioner has not shown that the supervening events have struck at the root of the contract. In other words, it has not become humanly impossible to perform the contract. Even though for some time in the beginning, it had become more onerous to get returns as expected by him, after lifting the ban in entering of devotees in temple, devotees have resumed visiting the temple and thus the petitioner has started supplying materials as required under the contract. After starting to supply materials, he cannot turn round and say that the contract has become impossible of performance and frustrated.
After starting to supply materials, he cannot turn round and say that the contract has become impossible of performance and frustrated. He cannot blow hot and cold at the same time". (underline supplied) 20. In Suresan Nair T.S. [ 2021 (6) KHC 837 ] one of the contentions raised by the petitioners was that, due to the outbreak of Covid-19 pandemic and the turn of events thereby, the contract could not be performed and has become frustrated. The Division Bench held that, when the case of the petitioners is that there is no binding contract, they cannot plead frustration of contract. The Division Bench noticed that the issue regarding frustration of contract was elaborately considered by this Court in Harikumar G. [ILR 2021 (1) Kerala 1050], wherein extension of licence period for selling pooja items in Ettumanoor Sree Mahadeva Temple was sought for in the background of Covid-19 pandemic. The Division Bench further noticed that the lock down and the resultant restriction in entry of devotees to temples on account of Covid-19 pandemic did not cover the entire period of contract. After lifting the lock down and when the temples were opened for devotees, they could conduct business for the rest of the period of contract. The petitioners were doing business during the previous season also on getting the kuthaka/right. As observed in Harikumar G., in contractual matters, unforeseen eventualities are bound to happen. For the reason that contractors could reap good profit during a season do not bind them to pay any additional amount to the Board. In the said decision, this Court also held that alteration of circumstances does not lead to frustration of contract and that the doctrine of frustration has to be applied narrowly. In Harikumar G., relying on the decision in Travancore Devaswom Board v. Thanath International [ (2004) 13 SCC 44 ], the Division Bench held that, merely because performance had become more onerous is not a ground for non performance or for claiming enhancement of price. Since the petitioners could do business during the rest of the term of the contract on lifting the restrictions, it cannot be said that the contract has become impossible for performance. Frustration of contract happens when the execution of contract is wholly impossible.
Since the petitioners could do business during the rest of the term of the contract on lifting the restrictions, it cannot be said that the contract has become impossible for performance. Frustration of contract happens when the execution of contract is wholly impossible. The supervening events followed by the pandemic have not made the execution of contract wholly impossible, though it might have made the performance of contract more onerous and difficult. Occurrence of commercial difficulty, inconvenience or hardship in performance of the conditions agreed to in the contract can provide no justification to wriggle out of the contractual obligations which the parties had accepted with open eyes. 21. In State of Haryana v. Jage Ram [ (1980) 3 SCC 599 ], relying on the decision of the Constitution Bench in Har Shankar v. Deputy Excise and Taxation Commissioner [ (1975) 1 SCC 737 ], the Apex Court held that, the respondent therein entered into a contract with the State authorities with the full knowledge of conditions which they had to carry out in the conduct of their business, on which they had willingly and voluntarily embarked. The occurrence of a commercial difficulty, inconvenience or hardship in the performance of those conditions, like the sale of liquor being less in summer than in winter, can provide no justification for not complying with the terms of the contract which they had accepted with open eyes. The respondents could not, therefore, invoke the writ jurisdiction of the High Court to avoid the contractual obligations incurred by them voluntarily. 22. In Firm Srinivas Ram Kumar v. Mahabir Prasad and others [ AIR 1951 SC 177 ] a Three-Judge Bench of the Apex Court made reference to the pronouncement of the Judicial Committee in Babu Raja Mohan Manucha v. Babu Manzoor [ AIR 1943 PC 29 ]. That appeal arose out of a suit commenced by the plaintiff appellant to enforce a mortgage security. The plea of the defendant was that the mortgage was void. This plea was given effect to by both the lower courts as well as by the Privy Council. But the Privy Council held that it was open in such circumstances to the plaintiff to repudiate the transaction altogether and claim a relief outside it in the form of restitution under Section 65 of the Indian Contract Act.
This plea was given effect to by both the lower courts as well as by the Privy Council. But the Privy Council held that it was open in such circumstances to the plaintiff to repudiate the transaction altogether and claim a relief outside it in the form of restitution under Section 65 of the Indian Contract Act. Although no such alternative claim was made in the plaint, the Privy Council allowed it to be advanced and gave a decree on the ground that the respondent could not be prejudiced by such a claim at all and the matter ought not to be left to a separate suit. 23. In South East Asia Marine Engineering and Construction Limited v. Oil India Limited [ (2020) 5 SCC 164 ], the Apex Court held that, when the parties have not provided for what would take place when an event which renders the performance of the contract impossible, then Section 56 of the Indian Contract Act applies. When the act contracted for becomes impossible, then under Section 56, the parties are exempted from further performance and the contract becomes void. As held in Satyabrata Ghose v. Mugneeram Bangur and Co. [ AIR 1954 SC 44 ], in deciding cases in India, the only doctrine that we have to go by is that of supervening impossibility or illegality as laid down in Section 56 of the Indian Contract Act, taking the word ‘impossible’ in its practical and not literal sense. It must be borne in mind, however, that Section 56 lays down a rule of positive law and does not leave the matter to be determined according to the intention of the parties. In India, Contract Act, 1872 had already recognised the harsh consequences of such frustration to some extent and had provided for a limited mechanism to ameliorate the same under Section 65 of the Contract Act. Section 65 provides that, when an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it, to the person from whom he received it. The aforesaid clause provides the basis of restitution for ‘failure of basis’. The aforesaid provision addresses limited circumstances wherein an agreement is void ab initio or the contract becomes subsequently void. 24.
The aforesaid clause provides the basis of restitution for ‘failure of basis’. The aforesaid provision addresses limited circumstances wherein an agreement is void ab initio or the contract becomes subsequently void. 24. In Sabarimala Vyapari Vyavasayi Ekopana Samathi v. Travancore Devaswom Board [2020 (5) KLT Online 1058] a Division Bench of this Court was dealing with a case in which the grievance raised by the first petitioner Samithi on behalf of its members including the second petitioner was that for the year 2019-20, they participated in the auction under the impression that they could conduct business for a period of 142 days. As an impact of the Covid-19 pandemic, they could conduct business only for a period of 70 days as there was no pilgrimage from March 2020 onwards. The prayer in the writ petition was for issuance of writ of mandamus to allow the members of the first petitioner including the second petitioner to do business for the remaining 72 days, commencing from November 2020. In other words, the petitioners contended that for the year 2020-21, at least for 72 days, no other person shall be permitted to conduct the business in respect of the businesses being conducted by the members of the first petitioner. In the contextual situation, the Division Bench referred to paragraph 12 of the decision of the Apex Court in Travancore Devaswom Board v. Thanath International [ (2004) 13 SCC 44 ], which reads thus; “12. The law on the subject is well settled. In the case of Alopi Parshad and Sons Ltd. v. Union of India [ AIR 1960 SC 588 ] this Court has held that the Contract Act, 1872 does not enable a party to a contract to ignore the express covenants thereof. It is held that the Contract Act does not permit a party to claim payment of consideration for performance of contract at rates different from the stipulated rates, on some vague plea of equity. It is held that in the performance of a contract, one often faces, in the course of carrying it out, a turn of events which are not anticipated, e.g., an abnormal rise or fall in prices, sudden depreciation of currency, an unexpected obstacle to execution or the like. It is held that these do not affect the bargain that has been made.
It is held that these do not affect the bargain that has been made. It is held that there is no general liberty reserved to the courts to absolve a party from liability to perform his part of the contract, merely because on account of an uncontemplated turn of events, the performance of the contract has become onerous. It is held that compensation quantum meruit is awarded when the price is not fixed by the contract. It is held that for work done or services rendered pursuant to the terms of contract, compensation quantum meruit cannot be awarded.” 25. Viewed in the light of the law laid down in the decisions referred to supra, the conclusion is irresistible that the petitioner, who is the successful bidder for running Aymanam Sri. Narasimhaswami Auditorium (Sadyalayam) in Aymanam Sri. Narasimhaswami Temple, for the period from 01.08.2019 to 31.07.2021, is not entitled for any concessions/remissions, etc., on account of any restrictions imposed in connection with Covid-19 pandemic. The petitioner, who has defaulted the payment of the balance auction amount is bound to pay the defaulted amount together with 18% interest for delayed payment. Since he had occupied ‘Sadyalayam’ till 01.02.2022, he is also liable to pay proportionate auction amount for an additional period of six months, together with 18% interest for delayed payment. 26. In M.V. Ramasubbiar v. Manicka Narasimachara [(1979) 2 SCC 75], in the context of Sections 49, 51 and 52 of the Trusts Act, 1882, the Apex Court explained the nature of the fiduciary position of the trustee and his duties and obligations. It is duty of the trustees of the property to be faithful to the Trust and execute any document with reasonable diligence in the manner of an ordinary prudent man of business would conduct his own affairs. A trustee could not therefore occasion any loss to the Trust and it is his duty to sell the property, if at all that was necessary, to best advantage. Paragraph 4 of that decision reads thus; “4.
A trustee could not therefore occasion any loss to the Trust and it is his duty to sell the property, if at all that was necessary, to best advantage. Paragraph 4 of that decision reads thus; “4. There is some controversy on the question whether Defendant 1 made an outright purchase of the suit property for and on behalf of the trust for Rs 21,500 on April 19, 1959, or whether he intended to purchase it for himself and then decided to pass it on to the trust, for defendants have led their evidence to show that the property was allowed to be sold for Rs 21,500, which was less than its market value, as it was meant for use by the trust and that Defendant 1 was not acting honestly when he palmed off the property to his son soon after by the aforesaid sale deed Ext.B13 dated July 14, 1960. The fact, however, remains that Defendant 1 was the trustee of the property, and it was his duty to be faithful to the trust and to execute it with reasonable diligence in the manner an ordinary prudent man of business would conduct his own affairs. He could not therefore occasion any loss to the trust and it was his duty to sell the property, if at all that was necessary, to best advantage. It has in fact been well recognised as an inflexible rule that a person in a fiduciary position like a trustee is not entitled to make a profit for himself or a member of his family. It can also not be gainsaid that he is not allowed to put himself in any such position in which a conflict may arise between his duty and personal interest, and so the control of the trustee's discretionary power prescribed by Section 49 of the Act and the prohibition contained in Section 51 that the trustee may not use or deal with the trust property for his own profit or for any other purpose unconnected with the trust, and the equally important prohibition in Section 52 that the trustee may not, directly or indirectly, buy the trust property on his own account or as an agent for a third person, cast a heavy responsibility upon him in the matter of discharge of his duties as the trustee.
It does not require much argument to proceed to the inevitable further conclusion that the Rule prescribed by the aforesaid sections of the Act cannot be evaded by making a sale in the name of the trustee's partner or son, for that would, in fact and substance, indirectly benefit the trustee. Where therefore a trustee makes the sale of a property belonging to the trust, without any compelling reason, in favour of his son, without obtaining the permission of the court concerned, it is the duty of the court, in which the sale is challenged, to examine whether the trustee has acted reasonably and in good faith or whether he has committed a breach of the trust by benefitting himself from the transaction in an indirect manner. The sale in question has therefore to be viewed with suspicion and the High Court committed an error of law in ignoring this important aspect of the law although it had a direct bearing on the controversy before it.” (underline supplied) 27. In the instant case, Aymanam Sri. Narasimhaswami Auditorium (Sadyalayam) is one constructed by the Travancore Devaswom Board by spending considerable amount. While auctioning the right for running that 'Sadyalayam', the 1st respondent Board and its officials have to ensure that proper income to the Board is generated from the said building. In case of any default committed by the successful bidder in remitting the balance auction amount, electricity charges or any other statutory dues in respect of that building, payable by the successful bidder as per the tender conditions, the concerned Assistant Devaswom Commissioner and the Sub Group Officer have to take prompt action against such bidder and the said fact has to be promptly reported to the concerned officer in the Estate Division of the Travancore Devaswom Board. 28. In the instant case, the petitioner has remitted only 50% of the auction amount on 18.07.2019. Though he had defaulted payment of the balance amount of Rs.1,20,500/-, he was permitted to continue to occupy the 'Sadyalayam', even beyond the period of auction, i.e., 31.07.2021. Respondents 4 and 5 have not taken any action against the petitioner till the order of this Court dated 01.02.2022, whereby they were directed to take over possession of the 'Sadyalayam' forthwith, if found necessary with police assistance.
Respondents 4 and 5 have not taken any action against the petitioner till the order of this Court dated 01.02.2022, whereby they were directed to take over possession of the 'Sadyalayam' forthwith, if found necessary with police assistance. The conduct of respondents 4 and 5 and also the concerned officers in the Estate Division of the Travancore Devaswom Board in taking no action against the petitioner, who was a defaulter, has to be deprecated in the strongest words and we do so. They have not shown reasonable diligence in the manner of an ordinary prudent man of business to conduct his own affairs. Moreover, since the auction amount for running 'Sadyalayam' for a period of two years from 01.08.2019 to 31.07.2021 was only Rs.2,41,000/-, the average monthly income generated from the said building constructed by the Travancore Devaswom Board by spending several lakhs of rupees is only Rs.10,000/-. Such irregularities in the conduct of auction for running auditoriums/sadyalayams in the temples under the management of the Travancore Devaswom Board cannot be permitted in future. Therefore, Registry shall initiate a suo motu proceedings in the above matter, with a copy of this judgment, with State of Kerala, represented by the Principal Secretary to Government, Revenue (Devaswom) Department, Government Secretariat, Thiruvananthapuram–695 001; Travancore Devaswom Board, represented by its Secretary, Nanthancode, Kowdiar Post, Thiruvananthapuram–695 003; Devaswom Commissioner, Travancore Devaswom Board, Nanthancode, Kowdiar Post, Thiruvananthapuram–695 003; the Estate Officer, O/o the Executive Engineer, Estate Division, Travancore Devaswom Board, Opposite to Ayurveda College, Puthen Chanthu, M.G. Road, Thiruvananthapuram – 695 001; and the Deputy Examiner of Local Fund Audit, Thiruvananthapuram 695 033, as the respondents in the party array. 29. In the above circumstances, the petitioner is not entitled for any of the reliefs sought for in this writ petition and the writ petition is accordingly dismissed, subject to the above direction. 30. The learned counsel for the petitioner would submit that, the petitioner has already surrendered vacant possession of 'Sadyalayam' to the 5th respondent on 01.02.2022 and he has also cleared the electricity dues. Considering the situation prevailing in the State on account of Covid-19 pandemic, the petitioner may be permitted to pay the balance auction amount in monthly installments.
30. The learned counsel for the petitioner would submit that, the petitioner has already surrendered vacant possession of 'Sadyalayam' to the 5th respondent on 01.02.2022 and he has also cleared the electricity dues. Considering the situation prevailing in the State on account of Covid-19 pandemic, the petitioner may be permitted to pay the balance auction amount in monthly installments. Though the conduct of the petitioner in defaulting payment of the balance amount and in occupying 'Sadyalayam' beyond the period of auction, i.e., beyond 31.07.2021, disentitle him from seeking any indulgence from this Court, considering the situation prevailing in the State on account of Covid-19 pandemic, we deem it appropriate to direct respondents 4 and 5 to keep in abeyance any coercive steps against the petitioner for a period of two weeks from the date of receipt of a certified copy of this judgment, to enable the petitioner to pay the entire balance auction amount together with 18% interest, as per tender conditions, and also the proportionate amount for the period from 01.08.2021 till 31.01.2022 together with 18% interest. In case of any default committed by the petitioner in remitting the aforesaid amount, within the time limit stipulated as above, the competent officer of the Travancore Devaswom Board shall initiate recovery proceedings against the petitioner and proceedings shall also be initiated, as per tender conditions, for blacklisting the petitioner.