The court affirmed that unjust retention of funds violates fundamental principles of justice, and review jurisdiction is limited to specific grounds, not allowing for re-argument of previously decided issues.

JUDGMENT :

1. The instant review petition has been filed for review of the order dated 08.04.2024 passed in W.P.(T) No.5475 of 2023 to the extent by which cost of Rs.5 lakhs has been directed to be transmitted in favour of the writ petitioner, private respondent herein, which is to be recovered from the Managing Director, JBVNL.

2. The brief facts of the case leading to filing of the instant review, needs to be referred as under:-

(i) The writ Petitioner-Firm (respondent herein) registered under the Companies Act, 1956 and engaged in the business of providing comprehensive engineering, procurement and construction services to the Core sector industries in India. The writ Petitioner-Firm has challenged the action of the Jharkhand Bijli Vitran Nigam Limited (JBVNL) in deducting Rs. 2,90,32,000/- from the running account bills raised against the supply of materials.

(ii) The Petitioner-Firm was selected for the rural electrification works under Deen Dayal Upadhyaya Gram Jyoti Yojna in XIIth Plan for Giridih, Bokaro and Dhanbad. Later, the JBVNL issued the Letters of Award, vide (i) Letter of Award for supply of materials being, LoA No. 01/RE dated 5th February 2016, LoA No. 03/RE dated 5th February 2016 and LoA No. 05/RE dated 5th February 2016 for the projects at Giridih, Bokaro and Dhanbad and (ii) Letter of Award for erection and civil works being LoA No. 02/RE dated 5th February 2016, LoA No. 04/RE dated 5th February 2016 and LoA No. 06/RE dated 5th February2016 for the aforementioned districts in the State of Jharkhand.

(iii) The JBVNL started deductions @ 2% from the running bills raised by the petitioner-Firm for the supply of materials and retained Rs. 2,90,32,000/- on the pretext of “Income Tax Contingency”. Through several communications, the petitioner- Firm requested the JBVNL to release the amount so withheld as Income Tax contingency and also informed the JBVNL that the amount withheld by it is not reflected in Form-26AS. Notwithstanding that, the JBVNL did not release the illegally deducted amount nor deposited the said amount with the Income Tax Department.

(iv) Aggrieved with the conduct of the JBVNL, the writ petitioner Firm had preferred a writ petition being W.P.(T) No. 5475 of 2023.

(v) Before the writ Court, the JBVNL had taken the ground that deductions made @ 2% from the running bill of the petitioner- Firm and the amount of Rs. 2,90,32,000/- has been “kept back” to safeguard its interest. It has been pleaded that the “kept back” amount shall be released or the TDS certificate will be issued depending on the outcome of the appeal preferred by the JBVNL against the demand notice dated 10^th October 2017.

(vi) In the counter affidavit, the JBVNL referred to the notice under section 201 of the Income Tax Act, 1961 and the demand notice that includes the fine and a penal interest for violation of the provisions for TDS deductions.

(vii) Per contra, the writ petitioner Firm had taken the ground that the petitioner-Firm is not a party to the dispute between the JBVNL and the Income Tax Department, and withholding of Rs. 2,90,32,000/- without issuing the TDS certificate, is arbitrary and unlawful.

(viii) The writ Court, while taking in to consideration the purport of the provisions of the Income Tax Act, follows the consequences as provided under Section 201 of the Income Tax Act and also the concept that any unjust retention of money or property of another shall be against the fundamental principles of justice, equity and good conscience, has allowed the said writ petition. The writ Court further observed that the imposition of cost on the party which started litigation without any just cause or took false and frivolous defence is necessary to discourage the dishonest litigant and to this end, the Court is required to impose such cost that would make the litigant think twice before putting up any speculative claim or defence. Consequently, the writ Court has further directed that JBVNL must be saddled with cost of Rs.5 Lac