Point of Law: Section 65 of Indian Contract Act contains principle of restitution after benefit has been received and contract is later discovered to be void.

JUDGMENT :

SANDEEP SHARMA, J.

1. Being aggrieved and dissatisfied with the order dated 23.9.2017, Annexure P-1, whereby, respondents, while cancelling Letter of Allotment (LoA) issued on 28.2.2009, in respect of Seli HEP (320 MW) in favour of M/s Seli Hydro Electric Power Company Limited/M/s Moser Baer Private Limited also ordered for forfeiture of Up-front Premium of Rs. 64.00 Crore, petitioner-company has approached this Court in the instant proceedings filed under Article 226 of the Constitution of India, praying therein for following main reliefs:

“(a) Issue a writ of Declaration or any other appropriate writ, order or direction declaring that the self appropriation/forfeiture of INR 64,00,00,000 (Rupees Sixty Four Crores) paid by the petitioner as Upfront Premium till the establishment/approval of the techno-economic viability of the SELI project is violative of Article 265, Article 300A, Article 14, Article 19 and Article 21 of the Constitution of India.

(b) Issue a writ of Certiorari or any other appropriate writ, order or direction quashing the communication dated 23.09.2017 having reference number HPDOE/CE (Energy)/Seli HEP/2017-5454-68 issue by the Respondent No. 1 to the extent it seeks to forfeit the Upfront Premium Deposit of INR 64,00,00,000 (Rupees Sixty-Four Crores) as deposited by the Petitioner on 20.07.2009.

(c) Issue a writ of mandamus or any other appropriate writ, order or direction directing the Respondents to refund to the Petitioner the Upfront Premium amount of INR 64,00,00,000/- (Rupees Sixty-Four Crores) as deposited by the Petitioner on 20.07.2009 along with interest at the rate of 18% per annum from the date of deposit till the time of refund.”

2. Facts. shorn of unnecessary details, but relevant for adjudication of the case at hand, are that in the year 2008, Government of Himachal Pradesh, with the aim and object of inviting private sector participation in Hydro Electric Projects in the State of Himachal Pradesh, invited bids vide advertisement dated 9.6.2008 (Annexure P-2), for inter-alia setting up of 320 MW Hydro Electric Project in District Lahul and Spiti, (hereinafter, referred to as the ‘Project’) on Build, Own, Operate and Transfer (BOOT) basis.

3. After scrutiny and examination of the documents filed by various bidders, including petitioner-Company, respondents found the petitioner-company eligible for allotment of project in question and vide LoA dated 28.2.2009 (Annexure P-3) awarded the project to the petitioner-Company. In terms of LoA, petitioner-Company was required to pay Up-front Premium of INR 64.00 Crore (Rupees Sixty Four Crore) towards fixed component of bid prize, which was paid on 20.7.2009 to the respondent No. 2 by the petitioner, as is evident from letter dated 20.7.2009 (Annexure P-4) wherein it is mentioned that Demand Draft of Rs. 20.08 Crore was deposited by petitioner and Rs. 43.92 Crore was refunded from Gondhala HEP. On 22.7.2011, a Pre-implementation Agreement (hereinafter ‘PIA’) (Annexure P-5) came to be entered inter se petitioner-Company and the respondent-State. In terms of PIA, petitioner-Company was permitted to incorporate a Special Purpose Vehicle (hereinafter ‘SPV’) having its office in State of Himachal Pradesh for implementation of the Project. After creation of SPV, as detailed herein above, a tripartite agreement dated 22.3.2011 (Annexure P-6) was executed inter se respondent No. 1, the petitioner-Company and HPPPL for transferring all assets, liabilities, obligations, privileges, NOC’s of HPPPL and benefits arising out of the project of HPPPL in of terms of PIA dated 22.3.2011 to the petitioner. As per Clause 3.1 of PIA, petitioner was required to deposit Up-front Premium of Rs. 64.00 Crore with the respondent Government and such amount was deposited by the petitioner’s predecessor i.e. HPPPL on 20.7.2009. Clause 3.5 of PIA provides for submission o