SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

2026 Supreme(Gau) 163

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

Advocates Appeared:
For the Appellants : K.K. Mahanta, S. Gautam, N. Begum
For the Respondents: B.J. Talukdar, P.K. Medhi

Termination of transport agreements requires clear evidence of malpractices; suspicion alone is insufficient for legal actions.

Headnote:(A) National Food Security Act, 2013 - Termination of transport agreement - Security deposit forfeited - Allegations of malpractice and breach of contract under Clauses 6, 7, and 10 of Transport Agreement dated 09.02.2018. (Paras 2, 11, 26, 30)

(B) Due Process - The Court highlighted that mere suspicion and failure to transport rice do not suffice to establish liability or involvement in malpractices without cogent evidence. (Paras 27, 30)

(C) Judicial Discipline - The Court referred to a previous ruling in a similar case, reinforcing the principle that termination and forfeiture require substantiated grounds. (Paras 12, 32)

Facts of the case:
The petitioner, a registered cooperative society, challenged the termination of their transport agreement and forfeiture of a security deposit following allegations of diversion of food grains. The Deputy Commissioner found the petitioner partially responsible for malpractices, which the petitioner contested.

Findings of Court:
The court found insufficient evidence to establish the petitioner's involvement and noted the lack of records indicating direct complicity in the alleged malpractices.

Issues: Whether the petitioner was liable for termination of the transport agreement based on alleged malpractices and whether the forfeiture of the security deposit was justified.

Ratio Decidendi: The court ruled that without clear and cogent evidence of wrongdoing, the termination and forfeiture were not legally sustainable.

Result: The writ petition is allowed; the impugned order of termination and forfeiture is set aside.

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

Click Here to Read the rest of this document
1
2
3
4
5
6
7
8
9
10
11
SupremeToday Portrait Ad
supreme today icon
logo-black

An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

Please visit our Training & Support
Center or Contact Us for assistance

qr

Scan Me!

India’s Legal research and Law Firm App, Download now!

For Daily Legal Updates, Join us on :

whatsapp-icon Back to top