THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
KARDAK ETE, J.
M/s Larua Samabai Samiti Limited – Appellant
Versus
The State of Assam and Others – Respondent
W.P. (C) No. 1573 of 2024
Decided On : 29-01-2026
| Table of Content |
|---|
| 1. transport contract termination and forfeiture of deposit (Para 2 , 4 , 10) |
| 2. role of the petitioner in food grain transportation (Para 3 , 6 , 7) |
| 3. arguments against allegations of malpractice (Para 11 , 12 , 13) |
| 4. court's evaluation of inquiry findings (Para 18 , 20 , 22) |
| 5. importance of clear evidence in contract disputes (Para 30 , 31) |
| 6. court's decision to set aside termination order (Para 32 , 33) |
JUDGMENT :
KARDAK ETE, J.
1. Heard Mr. K. K. Mahanta, learned Senior Counsel, assisted by Ms. N. Begum, learned counsel for the petitioner. Also heard Mr. B. J. Talukdar, learned Senior Counsel and Addl. Sr, Govt. Advocate, assisted by Mr. P. K. Medhi, learned counsel for the respondents.
2. The challenge made in the present writ petition is to the order dated 26.06.2023 passed by the Deputy Commissioner, Dibrugarh, by which, Food Grains/Rice Transportation Agreement dated 09.02.2018 is terminated and the security deposit furnished by the petitioner in respect of the transport contract is forfeited for alleged commission of malpractices and for breach of the terms of the transport contract agreement.
3. The petitioner is a registered Co-operative Society under the Assam Cooperative Society Act, 1949, having its office at Lepetkatta, near Ashapur Notun Gaon in the District of Dibrugarh Assam, and is engaged in the business of transportation of goods.
4. The case in brief is that the petitioner was selected as Transporter vide order dated 10.01.2018 pursuant to the NIT dated 18.02.2016 for handling and transportation of rice under the National Food Security Act, 2013 (hereinafter referred to as NFSA, 2013 in short) within the Dibrugarh District. An agreement dated 09.02.2018 was entered into between the Deputy Commissioner, Dibrugarh and the petitioner for transportation of allotted food grains under NFSA, 2013. As per the agreement, the petitioner was required to transport food grains in two TIERS. In TIER-I: from FSD of FCI, Dibrugarh (Goushala and Chawalkhowa FSDs) to the godowns of Gaon Panchayat Samabai Samittees (in short GPSS) under Barbaruah and Joypur Development Blocks; and in TIER-II: from GPSS godowns to the doorstep of Fair Price Shops located within the GPSS areas under Barbaruah and Joypur Development Blocks. Although the agreement was valid up to 31.03.2018, the petitioner was allowed to continue the transportation under the same terms and conditions.
5. It is the contention of the petitioner that for lifting of food grains in TIER-I, the Secretary or any other authorized person of the Society/firm is required to endorse their Lifting Book in the Office of the Deputy Commissioner and accordingly, the Secretary of the petitioner society used to endorse their Lifting Book in the Office of the Deputy Commissioner, Dibrugarh, after which release orders in respect of the food grains are issued by the Food Corporation of India (FCI). For TIER-II, the food grains are to be transported from WCCS/GPSS godowns to the doorstep of Fair Price Shops and it is the responsibility of the Secretary or Chairman of the GPSS to issue memos to the Fair Price Shops under their jurisdiction, to give demand to the transporter for placing the required vehicles for transportation of the food grains to the Fair Price Shops and to hand over a copy of the same to the transporter for doorstep delivery.
6. It is contended that the Secretary of the petitioner society endorsed their Lifting Book for the quota of TPDS rice for the months of May 2023 and June 2023. After issuance of the release orders to the FCI Depot, Dibrugarh, the Secretary of M/s Namrup GPSS Ltd. called the petitioner each time to the depot for transportation of the rice of TIER-I from the depot to their godown. The Secretary had acknowledged the receipt of all the rice quota for the months of May and June 2023 and road challans were also issued by the petitioner society for transportation. The petitioner, in the months of March and April 2023, in TIER-I, transported t
Termination of transport agreements requires clear evidence of malpractices; suspicion alone is insufficient for legal actions.
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....
Justification for issuing the impugned order cannot be permitted to be raised in the counter affidavit.
The withholding of security deposits and unpaid transportation charges by the corporation was illegitimate due to the lack of forfeiture orders and the termination of the E.C. Case against the contra....
The court ruled that claims for damages in breach of contract require proof of actual loss, which was not established by the plaintiffs, leading to dismissal of the appeal.
Contract cancellation under public distribution laws justified by evidence of diversion and black market intent, despite claims of procedural irregularities.
The obligation of the state to act fairly and reasonably in contractual disputes, and the importance of respecting the specific terms of a contract.
The issuance of a No Demand Certificate validly discharged the contract, and subsequent demands by the Food Corporation of India were arbitrary and illegal.
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