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2022 Supreme(Telangana) 594

IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
A. ABHISHEK REDDY, J.
IVRCL-NAVAYUGA and SEW (JV) – Petitioner
Versus
Government of Andhra Pradesh, Rep. by its Secretary – Respondent
Writ Petition No. 40000 of 2012
Decided On : 23-03-2022

Advocates:
Advocate Appeared:
For the Petitioner: Avinash Desai.

Headnote:

Constitution of India,1950 - Article 226 - Rejecting the claim of the petitioners for adjustment charges with regard to labour and other materials - Exclusion of the price adjustment for labour and other materials only for the petitioners cannot be countenanced and the same is illegal, bad, arbitrary and against the terms and conditions of the contract which are binding on the parties -Held, rejection of price adjustment for labour and other material cannot be countenanced by any stretch of imagination - This Court as well as Hon'ble Supreme Court in a catena of cases have held that internal memos/circulars cannot be basis for denying benefits to party more so when there is a binding contract between them - Parties to contract are always bound by terms and conditions of contract and they cannot breach terms based on an internal memo which was never brought to notice of other side - In absence of any evidence to show that said memo/circular was brought to notice of petitioners and that they have agreed for same in writing terms and conditions of contract will prevail and bind parties - Writ petition is Allowed.

ORDER :

1. Aggrieved by the issuance of the proceedings in Lr. No. EE/SYP/Dn.3/Estt/ECI/41/M/1No dated 03.02.2012 and Lr. No. SE/SYPC/MNCL/ATO- 3/190/4 dated 04.05.2012 rejecting the claim of the petitioners for adjustment charges with regard to labour and other materials, the present writ petition is filed.

2. Heard the learned counsel for the petitioners and the learned Government Pleader for Irrigation and Command Area Development for the respondents.

3. Learned counsel for the petitioners has stated that the respondent No. 1 has entered into an agreement with petitioner No. 1 vide Agreement Bond No. L.S.1/2005-06 dated 03.04.2005. Learned counsel, while drawing the attention of this Court to the terms and conditions of the contract, more specifically, clause 13.8.1 thereof, has stated that the official respondents instead of implementing the said clause, in toto, have denied some of the benefits to the petitioners and restricted the price adjustment only for cement, steel and fuel, and have rejected the benefit of the said clause for the labour and other material, based on the Government Memo No. 30250/Maj.Irr.III/A2/2007-6, dated 16.11.2009 said to have been issued by the Government. That the petitioners have no inkling, knowledge or notice of the same at any point of time. That the official respondents having entered into the contract are bound by the terms and conditions of the agreement and the price adjustment for labour and other materials cannot be rejected on the ground of an internal memo or circular issued by the Government. That the petitioners are not bound by the said internal memo or circular and the petitioners cannot be denied the benefits which they are entitled to under the terms of the contract entered between the parties. Learned counsel has also stated that subsequently the Government of Telangana vide G.O.Ms.No. 146 dated 08.10.2015 has extended the above said benefit to all the parties. Therefore, the exclusion of the price adjustment for labour and other materials only for the petitioners cannot be countenanced and the same is illegal, bad, arbitrary and against the terms and conditions of the contract which are binding on the parties. Learned counsel has also relied on the following judgments in support of his submissions:

    (1) Ssangyong Engineering and Construction Company Limited vs. National Highways Authority of India, (2019) 15 SCC 131

(2) Suresh Kumar Wadhwa vs. State of Madhya Pradesh, (2017) 16 SCC 757

(3) United India Insurance Co. Ltd. vs. M.K.J. Corporation, (1996) 6 SCC 428

(4) Karambir Nain vs. State of Haryana, 2014 SCC Online P&H 12589

(5) Government of Andhra Pradesh vs. Sri Sevadas Vidyamandir High School, (2011) 9 SCC 613

4. Per contra, the learned Government Pleader appearing on behalf of the official respondents has stated that the authorities concerned, duly taking into consideration the internal memo issued by the Government of India, have not paid the benefit to the petitioners. That the price adjustment for other items has already been paid to the petitioners except for these two items. Learned Government Pleader has also stated that the Department is bound by the Circulars issued by the Government wherein it has clearly stated that the price adjustment can be allowed only for cement, steel and fuel and not other items. Learned Government Pleader has also questioned the very maintainability of the Writ Petition on the ground that all these are the disputed questions of fact, which cannot be gone into under Article 226 of the Constitution of India and the petitioners have to be relegated to the Civil Court, if they have any grievance regarding breach of any conditions of the contract.

5. In reply, the learned counsel for the petitioners has drawn the attention of this Court to the letter addressed by Chief Engineer, I&CAD Deptt., SSP&FFC, LMD Colony, Karimnagar, to the Secretary, I&CAD Dept., Secretariat, Hyderabad, vide Lr.No. CE/SSP&FFC/LMD/TS/F.20/5817 dated 26.09.2007 wherein the Co

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