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High Court Of Calcutta
S. B. SINHA
RONIX POLYMERS PRIVATE LIMITED - Appellant
Versus
STATE OF WEST BENGAL - Respondent
W. P. 2688 Of 1996
Decided On : 04/15/1997
CONTRACT - TERMINATION - VALIDITY - JUDICIAL REVIEW - WRIT OF MANDAMUS - CONDITIONS - CONTRACTUAL DISPUTE - JURISDICTION OF COURT - PUBLIC LAW REMEDY - PRIVATE CONTRACT - CONTRACTUAL OBLIGATIONS - INSPECTION OF GOODS - BREACH OF CONTRACT - LIQUIDATED DAMAGES - TIME OF ESSENCE - UNILATERAL TERMINATION - LEGALITY - CONTRACTUAL REMEDIES - ALTERNATIVE REMEDIES.
Fact of the Case:
The petitioner entered into a contract with the State to manufacture and supply PVC pipes. The contract stipulated the time for delivery, inspection procedures, and liquidated damages for late delivery. The petitioner failed to deliver the pipes within the stipulated time and requested an extension, which was granted subject to certain conditions. Despite the extension, the petitioner could not deliver the pipes on time. The respondents terminated the contract, stating that the petitioner had failed to supply the materials within the extended period of time allowed.
Finding of the Court:
The court held that the termination of the contract by the respondents was valid and legal. The court found that the petitioner had breached the contract by failing to deliver the pipes within the stipulated time, despite being granted an extension. The court further held that the respondents were not liable to accept the pipes manufactured by the petitioner after the termination of the contract. The court also held that a writ of mandamus could not be issued to enforce a private contract and that the petitioner had alternative remedies available to it, such as arbitration or a civil suit.
Issues: 1. Whether the termination of the contract by the respondents was valid and legal. 2. Whether the respondents were liable to accept the pipes manufactured by the petitioner after the termination of the contract. 3. Whether a writ of mandamus could be issued to enforce a private contract.
Ratio Decidendi: 1. The court held that the termination of the contract by the respondents was valid and legal because the petitioner had breached the contract by failing to deliver the pipes within the stipulated time, despite being granted an extension. The court also found that the respondents had acted in accordance with the terms of the contract in terminating the contract. 2. The court held that the respondents were not liable to accept the pipes manufactured by the petitioner after the termination of the contract because the petitioner had failed to fulfil its contractual obligations. 3. The court held that a writ of mandamus could not be issued to enforce a private contract because the public law remedy of mandamus is not available in cases of private contracts.
Final Decision: The court dismissed the petitioner's application for a writ of mandamus, holding that the termination of the contract by the respondents was valid and legal, that the respondents were not liable to accept the pipes manufactured by the petitioner after the termination of the contract, and that a writ of mandamus could not be issued to enforce a private contract.
( 1 ) THE petitioner in this application has, inter alia, prayed for the following reliefs :-" (A) a writ or in the nature of mandamus do issue commanding the respondents :- (i) to rescind, cancel and/or withdraw the said purported letter of cancellation of the contract dated 12th December, 1995. (ii) to desist from giving any effect or further effect to and/or from taking any step or further step in pursuance of the said purported letter of cancellation of the contract dated 12th December, 1995; (iii) to desist from floating any further tender or placing any further order or accepting any delivery of making any payment in respect of PVC pipes of 100 mm diameter before accepting and plying for the PVC pipes manufactured by the petitioner No. 1 ; (iv) to command the respondent-authorities to take delivery of and pay for 32,250 meters of 100 mm diameter PVC pipes and 46,000 meters of 200 mm diameter PVC pipes manufactured by the petitioner No. 1 within 30th November, 1995. (b) Declaration that letter of termination dated 12-12-1995, being Annexure 'p' hereto is wrongful, bad and illegal and the respondents are bound to take delivery of PVC pipes under the contract dated 16-1-95 which have already been inspected and approved the remaining pipes after inspection. (c) A writ of or in the nature of certiorari do issue directing the respondents to certify and transmit to this Hon'ble Court all letters, papers and documents relating to the PVC pipes in respect of 110 mm and 200 mm diameter concerning the contract entered into with the petitioner No. 1 for supply of PVC pipes and the purported cancellation thereof and other records concerning the aforesaid PVC pipes from 30th November, 1995. So that conscionable justice may be dead upon considering the same. "the fact of the matter lies in a very narrow compass. The petitioner admittedly entered into a contract for manufacture and supply of galvanising pipe to the State on the terms and conditions laid down under the conditions of contract annexed to the work order dated 22-1194 as contained in Annexure 'b' to the writ application, the relevant provision whereof reads thus:-"the contractor is to deliver the materials on or before the dates mentioned in the tender. Failing which he Shall be bound to pay or allow one per cent on the total amount of the contract for every day not exceeding ten days that the contractor shall exceed the time for delivery as and by way of liquidated damages provided, however, that the Superintending Engineer may in his discretion reduce in such cases as he may 2 think fit, the said amount to such smaller amount as he may decide and his decision in writing in that respect shall be final. The Contractor shall give notice to the Executive Engineer, or the Sub -Divisional Officer of his intention of making delivery of materials, and on the materials being approved a receipt shall be granted to him by the Executive Engineer or the Sub-Divisional Officer, and no material will be considered as delivered until so approved. "
( 2 ) THE said contract further provided for the Following conditions :-" (A) Quantity : PVC pipes110 mm diameter-32250 Meters. 200 mm diameter-4600meters. (b) Price : PVC pipes, 100 mm diameter Rs. 66/-per Metre. 200 mm diameter Rs. 221/-per Metre. (c) Time for Delivery: Four months from the date of issuance of the work order. (d) Inspection : By Director General of Supplies and Disposal. First by Director General of Supplies and Disposal and despatch to be made only thereafter. (e) Additional Inspection. :committee consisting of three Executive Engineers of the directorate shall also inspect the material either at the factory or at stores/ sites. (f) Special terms : (i) The Contractor, (meaning the petitioner No. 1 ) is to deliver the materials on or before the date mentioned in the tender, failing which, he shall be bound to pay or allow one per cent of the total amount of the contract for every day not exceeding 10 days that
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