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2014 Supreme(Mad) 83
High Court of Judicature at Madras
N. PAUL VASANTHAKUMAR, J.
M. Eswari
Versus
The Regional Manager MSTC Limited & Others
Writ Petition No. 7905 of 2013
Decided On : 10-01-2014
For the Petitioner:N. Menaka, Advocate.
For the Respondents:R1, C. Vijayakumar, R2, M.B. Raghavan, R3, S.V. Udayakumar, Advocates.
The principle of Caveat Emptor and the enforceability of forfeiture clauses in contracts were central to the court's decision.
Headnote:
Mandamus - E-Auction Dispute - Condition No.7 of e-Auction Terms and Conditions - 2011 STPL (Web)705 SC, 2009 (11) SCC 18, 2012 (6) CTC 621 - The court discussed the application of the principle of Caveat Emptor and the forfeiture clause in the context of the petitioner's claim for refund of EMD and compensation. The court held that the petitioner's lack of awareness of the necessity to obtain e-waste certificate and e-waste disposal license does not entitle him to demand a refund of EMD, as the principle of Caveat Emptor applies. The court also emphasized the enforceability of the forfeiture clause in the e-auction contract, leading to the dismissal of the writ petition.
Fact of the Case:
The petitioner participated in an e-auction, purchased solar panels, and later demanded a refund of EMD and compensation due to difficulties in processing the panels and the transfer of the material disposal process to a third party.
Finding of the Court:
The court found that the petitioner's lack of awareness of the requirement for e-waste certificate and e-waste disposal license does not entitle him to a refund of EMD, and the forfeiture clause in the e-auction contract is enforceable, leading to the dismissal of the writ petition.
Issues: The main issue was whether the petitioner was entitled to a refund of EMD and compensation due to difficulties encountered after participating in the e-auction.
Ratio Decidendi: The court applied the principle of Caveat Emptor and emphasized the enforceability of the forfeiture clause in the e-auction contract, leading to the dismissal of the writ petition.
Final Decision: The writ petition was dismissed, and no costs were awarded to the petitioner.
1. The prayer in the writ petition is to issue a Writ of Mandamus directing the first and second respondents to dispose of the petitioner's representation dated 9.2.2013.
2. In the representation, the petitioner has prayed for return of EMD to the tune of Rs.8,75,029/- with 2% interest from the date of deposit in addition to Rs.10,00,000/- as compensation by the first respondent for not paying due attention before auction and Rs.25,00,000/- for creating hardship and mental agony.
3. The said representation was submitted on the following circumstances.
"(i) The petitioner participated in the e-auction held by the first respondent-company on 3.7.2012 and he was declared as the purchaser of "Film solar photovoltic module" for an amount of Rs.35,00,114/- and he was asked to pay EMD amount of Rs.8,75,029/- to the second respondent. The petitioner has paid the said EMD amount on 10.7.2012 and he was asked to pay the remaining amount within six days.
(ii) According to the petitioner, he made a representation on 10.7.2012 demanding sample pieces and extension of time, for which, the second respondent issued a letter on 12.7.2012 to the third respondent directing the third respondent to hand over 10 numbers of samples, of which only 9 numbers of solar panels were given as samples by the third respondent. On processing, the petitioner was warned by the Pollution Control Board officials for carelessly handling the waste and gave a direction in disposing of the wastes i.e. only through factory outlet processing method and under their supervision.
(iii) On 21.8.2012, the petitioner addressed a letter to the second respondent and explained about the difficulties as well as the oral instruction given by the Pollution Control Board. The petitioner demanded 500 numbers of solar panels from the New India Assurance and he processed 100 numbers as per the guidelines given by the Pollution Control Board.
(iv) While the process was going on, they stopped the process and demanded e-waste certificate and e-waste disposal license by the petitioner. The petitioner was instructed to stop further processing till the certificate was obtained. The petitioner stopped the process and intimated the same on 30.10.2012 to the second respondent and requested to return the EMD.
(v) On 14.12.2012, the second respondent informed that due to failure of non-payment of balance amount, the entire process of disposing the material was transferred to the third respondent. The second respondent also transferred the EMD amount of Rs.8,75,029/- and instructed the petitioner to contact L & T for payment, but the same was denied with a direction to meet the second respondent officials.
(vi) The petitioner again submitted a representation to respondents 1 and 2 on 27.12.2012 and demanded the EMD deposit. The petitioner again submitted a representation on 2.1.2013, for which, on 9.1.2013, the second respondent gave a reply. Not satisfied with the said reply, the petitioner submitted further representation on 9.2.2013, which is sought to be disposed of by this writ petition."
4. The said prayer in the writ petition is opposed by respondents 1 and 2.
5. The learned counsel appearing for the first respondent relying on the auction condition, particularly condition No.7, submitted that the petitioner having chosen to participate in the e-auction, on the basis of as is where is condition, he is not entitled to now turn around and state that he is not aware of the licence to be obtained and applying the Principle of Caveat Emptor, the petitioner is not entitled to demand refund of EMD with any further relief.
6. The learned counsel appearing for the second respondent submitted that similar issue was considered by the Honourable Supreme Court in the decision reported in 2011 STPL (Web)705 SC (State of Haryana & Others vs. M/s.Malik Traders) and stated that the petitioner is not having any enforceable right for giving direction to consider the representation of the petitioner.
7. I have co
