The principle of constructive res judicata and the doctrine of election were applied by the court to dismiss the writ petitions.

JUDGMENT :

P.S. Dinesh Kumar, J. –

1. These two writ petitions are filed by M/s. Indo Unique Flame Ltd., against M/s. Karnataka Power Corporation Limited ('KPCL' for short).

2. The subject matter of these writ petitions are substantially common and therefore, by consent of learned Advocates on both sides, they are disposed of by this common order.

3. Heard Shri. S.S. Naganand, learned Senior Advocate for petitioner and Shri. Pramod Nair, learned Advocate for respondent.

4. Briefly stated the facts of the case set out in the writ petition are, petitioner is a Coal Washery Operator. Respondent is a Power Generating Company. It requires coal as a basic raw material. It enters into agreements with suppliers of coal and gets coal washed prior to delivery to remove mud, dust and other impurities.

5. Kpcl invited for tenders on 12.11.2014 for beneficiation (washing) of raw coal from Western Coal Fields Ltd., area for Raichur Thermal Power Station. Petitioner was awarded the Contract. Parties have entered into an agreement dated 14.10.2015. In terms of the agreement, two lakhs MT of raw coal was required to be washed per month. The term of contract was for a period of one year from the date of commencement of supply extendable for another two years. As per the agreement, petitioner has furnished security deposit of Rs.4.06 crores and four Bank guarantees in all for Rs.25.23 crores towards raw coal deposit.

6. The salient features of the agreement are, petitioner was required to determine the specification and source of raw coal available from Western Coal Fields for washing. Petitioner was required to lift 2 lakh MT raw coal quantity by road from collieries to the washery. The weighment at colliery would be witnessed by the petitioner on behalf of the respondent and weighment sheets are required to be signed by petitioner's authorized signatory and presented to KPCL while raising monthly Invoices. Petitioner would wash and transport coal to the railway siding for dispatch to KPCL. Petitioner was required to supply washed coal quantity having yield of 80% of the raw coal.

7. During the process of washing, certain portion of raw coal gets rejected. In terms of Clause 5 of the agreement, petitioner was permitted to sell the rejected coal at the rate of Rs.650/- per MT and adjust the same in the running Bills.

8. M/S. Elegant Enterprises was appointed by KPCL to draw sample coal at the Coal Fields at the time of lifting. KPCL removed M/s. Elegant Enterprises and appointed Central Institute of Mining and Fuel Research ('CIMFR' for short) for that purpose. At the washery end, M/s. K.C. Sharma & Company was appointed for certification. Petitioner made several requests for Joint reconciliation of accounts. Instead of undertaking the exercise of joint reconciliation, KPCL was compelling the petitioner to sign reconciliation statement prepared unilaterally by KPCL without sharing any details. Petitioner raised its objection on 20.09.2017. Petitioner was entitled to receive Rs.36,40,04,584/-. It has recovered sale proceeds of Rs.30,49,43,620/- by sale of rejected coal. Thus, KPCL is due and liable to pay a sum of Rs.5,90,60,964/- to the petitioner.

9. While petitioner's claim was pending, KPCL on 06.12.2017 wrote to State Bank of India, Nagpur invoking the Bank Guarantees to the tune of Rs.29.29 crores.

10. Petitioner filed O.S. No.8433/2017 before City Civil Court, Bengaluru for permanent injunction to restrain SBI from complying with KPCL's request to pay money by invoking five Bank guarantees. The City Civil Court granted an ex parte interim order on 08.12.2017.

11. Petitioner also filed O.S. No.8544/2017 before City Civil Court, Bengaluru to recover Rs.5,90,60,964/-

12. In its Statement of Objections filed in O.S. No.8433/2017, KPCL has contended that a meeting was convened on 06.12.2017 to reconcile the accounts and based on the reports of K.C. Sharma and CIMFR, KPCL had determined that a sum of Rs.57.02 crores was payable by the petitioner to KPCL. O