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2022 Supreme(Raj) 145

IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR
INDERJEET SINGH, J.
B V G India Ltd., (A Bharat Vikas Group Company) - Appellant
Versus
State of Rajasthan & Ors. - Respondent
S.B. Civil Writ Petition No. 5253/2021
Decided on : 02-02-2022

Advocates:
Advocate Appeared:
For the Petitioner: Mr. Sudhir Gupta, Sr. counsel assisted by Mr. Sandeep Ladda, Adv., Mr. Sandeep Singh Shekhawat, Adv. Ms. Shweta Chauhan, Adv., Ms. Priya Pareek, Adv., Ms. Sejal Harneja, Adv. all through V.C.
For the Respondent: Mr. Anil Mehta, AAG Mr. Vimal Chand Choudhary, Adv. both through V.C.

Headnote:

Constitution of India, 1950 – Article 226 – Indian Contract Act, 1872 – Section 74 – Arbitration and Conciliation Act, 1996 – Section 11(6) – Segregation & transportation of municipal solid waste – Learned Additional Advocate General, appearing on behalf of respondents raised a preliminary objection with regard to maintainability of writ petition and submitted that petitioner-company during pendency of present writ petition has invoked arbitration clause and filed application for appointment of Arbitrator and in support of contention he made a reference of Arbitration Application – Held, terms and conditions of contract entered into between parties, reveals that there is an arbitration clause which provides that in case of any dispute, matter can be referred to Sole Arbitrator - Arbitration application filed by petitioner before this court for appointment of Arbitrator including its prayer, shows that all disputes including implementation of letter/order is subject matter of arbitration application - Writ petition filed by petitioner-company deserves to be dismissed for reasons; firstly, petitioner-company has invoked arbitration clause by filing arbitration application and a perusal of its contents including prayer, shows that dispute involved in this writ petition has also been raised in arbitration application; secondly, as stated by AAG that they will act in accordance with terms and conditions of original agreement while taking any action against petitioner, apprehension of petitioner-company has no foundation and lastly in facts and circumstances of present case, since matter relates to contract between parties, court is not inclined to exercise extraordinary jurisdiction of this court under Article 226 of Constitution of India – Writ petition dismissed.

JUDGMENT :

1. This writ petition has been filed by the petitioner with the following prayer:-

    "In view of the above reasons, law and circumstances of the case, it is most humbly prayed that this Hon'ble Court may kindly be directed to the respondent no. 4 Nagar Nigam, Jaipur Greater to execute contract, supplementary agreement in compliance of order dated 18.01.2021 passed by respondent no. 3 and respondents may kindly further be directed to allow the petitioner firm, to continue the work as per earlier agreement dated 24.03.2017 and work order dated 17.03.2017, moreover, release the legitimate dues of the petitioner, forthwith; and may pass any other order (s) which this Hon'ble Court deems just and proper in the facts and circumstances of the case in favour of the petitioner."

2. Brief facts of the case are that the petitioner entered into an agreement with the Nagar Nigam Jaipur for collection, segregation & transportation of municipal solid waste under the guidelines Swachh Bharat Mission and the said agreement was executed between the parties on 24.03.2017 for a period of seven years.

During the currency of the said agreement, the State Government bifurcated the Nagar Nigam, Jaipur into two; Nagar Nigam Greater and Nagar Nigam Heritage. The respondents issued a letter to the petitioner seeking consent for continuation of the contract executed between them, pursuant to which the petitioner submitted its response to the Nagar Nigam Greater, Jaipur giving its consent for continuance of the work.

3. On 18.01.2021, the Department of Local Self Government issued an order granting approval for continuation of the contract subject to entering into a supplementary agreement with the petitioner for continuance of the work, thereafter, the petitioner requested the Nagar Nigam Greater, Jaipur to enter into a supplementary agreement and when the Nagar Nigam Greater, Jaipur failed to execute the supplementary agreement, the petitioner approached this Court by filing the present writ petition for implementation of the order dated 18.01.2021.

4. Mr. Sudhir Gupta, learned Senior Counsel appearing on behalf of the petitioner submitted that the Nagar Nigam Greater, Jaipur is under obligation to enter into supplementary agreement with the petitioner-company as per the directions issued by the Department of Local Self Government. He further submitted that the legitimate expectation of the petitioner is that the respondent-Nagar Nigam Greater must obey and comply the directions issued by the Department of Local Self Government. Learned senior Counsel further submitted that although there is clause of arbitration in the agreement but there is no absolute bar restraining the petitioner from invoking jurisdiction of this Court under Article 226 of the Constitution of India.

5. Mr. Sudhir Gupta, learned Senior Counsel further submitted that the arbitration clause invoked by the petitioner is with regard to non-payment of its dues towards the work done by it as such the present writ petition filed by the petitioner involving a separate cause/relief seeking almost a different direction to the respondents to execute the agreement deserves to be allowed. It was further submitted that the issue raised in this writ petition is with regard to sovereign function and duties of the State which can only be considered by this court under Article 226 of the Constitution of India.

6. In support of the contentions, learned Senior Counsel relied upon the judgment passed by the Hon'ble Supreme Court in the matter of Union of India & Ors. v. Tantia Construction Private Limited reported in (2011) 5 SCC 697 where in para-32 & 33 it has been held as under:-

    "32. The submissions made on behalf of the petitioners that in terms of Clause 23(2) of the agreement, the petitioners were entitled to alter and increase/decrease the scope of the work is not attracted to the facts of this case where the entire design of the rail over bridge was altered, converting the same into a complet

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