IN THE HIGH COURT OF GAUHATI, (Assam, Nagaland, Mizoram And Arunachal Pradesh)
Suman Shyam, J.
Mukti Nath Rai S/o. Late Sri Rai – Petitioner
Versus
The Executive Director, Food Corporation Of India And 8 Ors – Respondents
W.P.(C.) No.4398 Of 2022
Decided On : 14-09-2022
Constitution of India,1950 - Article 12,14,226 – Indian Penal Code,1860 – Section 406,407 - Code of Civil Procedure,1908 - Section 34 - Order VIII Rule 6-A - Interest Act, 1978 – Section 3 - Equality before law – Power of High Court to issue Certain Writs – Punishment for criminal breach of trust – Criminal breach of trust by carrier, etc – Counter- claim by defendant - Whether writ petitioner was liable for breach of contract due to non-delivery of rice bags FCI godown - Section 34 of Code of Civil Procedure also empowers the court to award interest on the principal sum from the date of the suit in addition to interest for any period prior to institution of the suit. (Para 34).
Findings of the Court: Court is of opinion that due to delay and inaction on part of respondents in releasing his contractual dues petitioner has been made to suffer harassment and mental agony. As such, petitioner would be entitled to be suitably compensated for said purpose as well.
Result: Petition disposed of
JUDGMENT :
1. Heard Mr. A. C. Borbora, learned senior counsel assisted by Mr. M. Smith, learned counsel appearing for the writ petitioner. I have also heard Mr. P. K. Roy, learned senior counsel assisted by Ms. A. Chakraborty, learned counsel appearing for the respondents (FCI).
2. The instant writ petition has been filed with a prayer to enforce the legal rights of the petitioner by issuing a direction upon the respondents (FCI authorities) to release the security deposit and the unpaid bills of the petitioner together with interest without any further delay. The facts and circumstances, giving rise to the filing of the writ petition, as projected through the pleadings, are briefly stated herein below.
3. Pursuant to a process of competitive bidding, the writ petitioner was appointed as a transport contractor under the FCI for a period of two years, i.e. during 28.03.1985 to 27.03.1987, in respect of three different routes. The appointment letters and the routes assigned to the petitioner are 1) “Ex-New Bongaigaon Railway Station to FSD Dimapur by Letter dated 28-031985”, 2) “Ex-Barua Bamungaon to FSD Golaghat by Letter dated 12-12-1984” and 3) Ex-FSD Dergaon to FSD Dimapur by Letter dated 09-08-1985”. For the purpose of executing the aforementioned transportation contracts the petitioner had deposited an amount of Rs 1,84,250/-as security deposits with the respondent authorities and started execution of the works. According to the writ petitioner he had transported 44 truck load of rice to the Dimapur godown of the FCI. However, 26 trucks of foodgrains transported by the writ petitioner were not received by the Depot Manager of FCI at Dimapur due to non-availability of godown space. Situated thus, the petitioner had to store the food items in a private godown and thereafter, issue a letter intimating the respondents about the matter with a request to take possession of the transported goods but to no avail. The petitioner has alleged that instead of taking delivery of the 26 truck load of rice bags, the respondents had terminated all the three transportation contracts and instituted Money Suit No 20/2007 in the court of Civil Judge (Senior Division) Jorhat for recovery of an amount of Rs. 11,88,393/- from the petitioner and his agent. That apart, the respondents had also lodged a criminal complaint against the petitioner and his agent Akhil Bhowal which was registered and numbered as BGR Case No.209 /1986 u/s 406 of the IPC. After the dismissal of the above proceedings, the petitioner had submitted several representations and also sent a legal Notice to the respondents demanding release of the security deposit and outstanding contractual dues amounting to Rs.3,80,299.98 along with interest but till date the amount has not been released. Hence, this writ petition.
4. The respondent nos.1 to 8 have filed a joint counter–affidavit questioning the maintainability of the writ petition inter-alia contending that the petitioner’s claim is barred by time and this being a very old case, records pertaining to the transactions were also not available with the department.
5. By referring to the materials available on record, Mr. Borbora, learned senior counsel for the petitioner has submitted that the petitioner did not violate the contract agreement at any point of time so as to forfeit his contractual dues. That apart, after the dismissal of Money Suit No.20/1987 filed by the FCI for recovery of money claimed from the petitioner and on dismissal of the appeal as well as the SLP preferred by the FCI, there was no ground whatsoever for the respondents to sit over the pending bills of the petitioner. Mr. Borbora has also invited the attention of this Court to the order dated 10.07.1992 passed by the learned Chief Judicial Magistrate, Bongaigaon in connection with BGR Case No.290/1986 to contend that even the criminal proceeding registered against the petitioner under Section 407 of the IPC was dropped by learned Judicial Magistrate on th
State of Madhya Pradesh vs. Bhailal Bhai and others
Sethi Auto Service Station and others vs. Delhi Development Authority and others
Ajay Hasia vs Kahlid Mujib Sehravardi reported in (1981)1 SCC 722
Kumari Shreelekha Vidarthi and others vs State of U.P. and others reported in (1991) 1 SCC 212
Union of India and another vs. S. B. Vohra and others reported in (2004) 2 SCC 150
Smt. Sudama Devi vs. Commissioner and others reported in (1983)2 SCC 1
Tahazhathe Purayil Sarabi vs. Union of India reported in (2009)7 SCC 372
Godavari Sugar Mills Ltd. vs. State of Maharashtra & others reported in (2011) 2 SCC 439
It is trite law that award of interest in a writ petition comes within the ambit of discretionary jurisdiction of the Writ Court.
The withholding of security deposits without proven negligence is arbitrary, invalidating the corporation's set-off claims and violating natural justice principles.
The judgment establishes that the exercise of unfettered discretion by the Authorities, without complying with the Principles of Natural Justice, renders their decision illegal and subject to judicia....
State cannot withhold admitted dues for executed works from which it benefited, citing procedural lapses or paucity of funds; such arbitrary action violates Article 14, attracting writ jurisdiction u....
The court reaffirmed that contractual disputes with an arbitration clause are not maintainable under Article 226 unless exceptional circumstances arise, emphasizing lawful forfeiture of security for ....
Writ petitions are maintainable for contractual claims against state entities, and withholding payments due to contractors on arbitrary grounds violates constitutional obligations to act fairly.
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