2022 Supreme(AP) 1086

ANDHRA PRADESH HIGH COURT AT AMARAVATI
Venkateswarlu Nimmagadda, J.
Sunshine Electricals – Appellant
Versus
State of Andhra Pradesh – Respondent
Writ Petition No. 22568 of 2020
Decided On : 06-09-2022

The extraordinary jurisdiction of this Court can be exercised in view of the admission made by the 3rd respondent regarding payments to be payable to the petitioner.

Headnote:

CONTRACT - ADMISSION OF AMOUNT PAYABLE - WRIT JURISDICTION - MAINTAINABILITY - DISPUTED FACTS - ARBITRATION - CONTRACTUAL OBLIGATIONS - EXTRAORDINARY JURISDICTION - PUBLIC LAW CHARACTER - MODE OF SETTLEMENT - MONEY CLAIMS - CONTRACTUAL MATTERS - DISCRETION OF HIGH COURT - PUBLIC INTEREST - NATURAL JUSTICE - PRINCIPLES OF NATURAL JUSTICE - VIOLATION - WRIT JURISDICTION - MAINTAINABILITY - CONTRACTUAL OBLIGATIONS - ADMISSION OF FACTS - OFFICIAL RESPONDENTS - WRIT JURISDICTION - AVAILABILITY - SETTLED LAW - RELIEF - INTEREST - AWARD - SETTLED LAW - CONTEMPT OF COURTS ACT, 1971 - SECTIONS 10 AND 12 - COMPLIANCE WITH COURT ORDER - PAYMENT OF ADMITTED AMOUNT - COMPLIANCE WITH INTERIM ORDER - CLOSURE OF CONTEMPT CASE.

Fact of the Case:

Petitioner, a vendor, entered into an agreement with the 3rd respondent-Corporation for conversion of conventional streetlights into energy efficient LED street lighting system. The 1st respondent issued a Memo permitting the 2nd respondent to enter into a separate agreement with the 3rd respondent with conditions same as that of conditions of agreement with EESL. The 3rd respondent admitted the amount payable to the petitioner upto 30/6/2020 is Rs.8,42,61,256.56 out of which, an amount of Rs.3,03,79,110.00 was paid and balance quarterly bill amount of Rs.5,38,82,146.00 is to be received from respondent Nos.1 and 2. The 2nd respondent admitted total amount payable in respect of Visakhapatnam District upto December, 2019 is Rs.6,62,00,643.00 to the 3rd respondent herein and out of the said amount upto December, 2019, Rs.3,04,13,963.00 was paid and remaining Rs.3,57,88,868.00 was paid after the orders of this Court and pleaded the entire amount due to the petitioner as per Memo dtd. 19/5/2020 has been paid. The petitioner filed a writ petition declaring the inaction of the respondents in releasing the payments due to the petitioner as per the directions of the 2nd respondent vide Memo No.24/CPR & RD/LED/2018, dtd. 19/5/2020 and subsequent letter of the 1st respondent vide Letter No.PRR01- PROPPAN(STLT)/5/Pts.III/A2/2020, dtd. 19/8/2020 in respect of the work executed by the petitioner for conversion of existing conventional streetlights into energy efficient LED street lighting system for conservation of energy in Gram Panchayats in Visakhapatnam District, as per agreement dtd. 30/10/2017 with the 3rd respondent-Corporation herein, as illegal and arbitrary. The respondents contended that the writ petition is not maintainable since alternative remedy is available by way of initiation of arbitration proceedings as per Clauses 19(1), 19(2) and 19(3) of the agreement dtd. 30/10/2017 entered into between the petitioner as well as the 3rd respondent herein. Moreover, there is no privity of contract between the petitioner and respondent Nos.1 and 2.

Finding of the Court:

The Court held that the contention of the petitioner that once the 3rd respondent-Corporation admitted by sworn affidavit before the Court regarding payments to be payable to the petitioner is amounts to admission on the part of the 3rd respondent and the extraordinary jurisdiction of this Court can be exercised in view of such admission made by the 3rd respondent is sustainable. The another contention of the petitioner that for payment of infrastructural developmental charges is accepted by respondent Nos.1 and 2 and issued a memo directing the 2nd respondent to enter into an agreement to that effect with the 3rd respondent is complied with and accordingly, an agreement was entered on 23/10/2017. In view of the agreement entered into between respondent Nos.2 and 3, the 3rd respondent admitted such amount in its counter affidavit regarding infrastructural developmental charges to be payable to the petitioner. Therefore, such contention of the petitioner is sustainable.

Issues: 1. Whether the writ petition is maintainable in the matter of contracts, when the action of the respondent statutory authorities is in violation of principles of natural justice and is not in accordance with the procedure as contemplated and in the public interest? 2. Whether the extraordinary jurisdiction of this Court is amenable regarding disputed facts between the parties?

Ratio Decidendi: 1. The Court held that the writ petition is maintainable in the matter of contracts, when the action of the respondent statutory authorities is in violation of principles of natural justice and is not in accordance with the procedure as contemplated and in the public interest, as held by the Hon'ble Apex Court in Union of India and others v. Tantia Constructions Private Limited, 2011 (5) SCC 697. and similarly the Hon'ble Apex Court also in Naseem Ahmed v. State of Uttar Pradesh, 2015 (14) SCC 685. held that "in view of the fact that the amount had been admitted by the respondent Government, we feel that said amount should be paid without entering into any arbitration, etc. and therefore the amount shall be paid to the appellant within four months from today after deducting taxes etc." 2. The Court held that the extraordinary jurisdiction of this Court is not amenable regarding disputed facts between the parties.

Final Decision: The Court disposed of the Writ Petition with a direction to the respondents to pay the remaining balance amount as per the counter affidavit of the 3rd respondent herein within a period of six (6) weeks from the date of receipt of a copy of this order. The Court also closed the Contempt Case as the interim order of this Court dtd. 6/8/2021 has been complied with.