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2024 Supreme(Online)(MAD) 38314
HIGH COURT OF MADRAS
M.Dhandapani, J
Managing Director Tamil Nadu Civil Supplies Corporation – Appellant
Versus
Union of India – Respondent
W.P. NO. 886 OF 2020
For the Appellants/Petitioners: P.S.Raman, C.Selvaraj
For the Respondents: AR.L.Sundaresan, Diwakar, Navod Prasannan
The rule of exclusion of writ jurisdiction due to the availability of an alternative remedy is a matter of judicial discretion, not compulsion; it does not apply where the liability is clearly admitted by the respondent, allowing the High Court to issue a writ of mandamus to enforce payment.
Headnote:(A) Constitution of India - Article 226 - Writ jurisdiction - Alternative remedy - Rule of discretion - Admission of liability - Held, rule of exclusion of writ jurisdiction by availability of an alternative remedy is a rule of discretion and not one of compulsion - Writ jurisdiction can be invoked in cases of admitted liability where there is no dispute over the claim. (Paras 10, 19, 20, 31)
Facts of the case:
Petitioner, engaged in the distribution of essential commodities, purchased RBD Palmolein Oil from the respondent entity under a Government scheme. Although the subsidy was released by the Central and State Governments to the respondent, the respondent failed to reimburse the admitted amount of Rs. 154,51,98,540/- to the petitioner despite several representations and admissions of the liability by the respondent.
Findings of Court:
Court found that since the respondent had clearly admitted the liability through contemporaneous documents and correspondence, the argument regarding the existence of an alternative remedy (arbitration/administrative mechanism) was merely an attempt to prolong litigation. The court exercised its extraordinary jurisdiction under Article 226 as the claim was an admitted debt requiring no adjudication.
Issues: Whether the writ petition is maintainable despite the availability of an alternative remedy, and whether the respondent is legally obligated to remit the admitted subsidy amount.
Ratio Decidendi: Where the liability is admitted through documentary evidence and correspondences between parties, the existence of an alternative remedy does not act as an absolute bar to the exercise of writ jurisdiction by the High Court under Article 226, as relegating the party to such remedy would be an abdication of constitutional power.
Result: Allowed, with a direction to the respondent to pay the amount within twelve weeks.
| Table of Content |
|---|
| 1. factual background leading to the claim of unpaid subsidy. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9) |
| 2. arguments regarding maintainability of writ petition and alternative remedy. (Para 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17) |
| 3. analysis of admission of liability and applicability of alternative remedy doctrine. (Para 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29 , 30) |
| 4. conclusion and direction to release the admitted subsidy amount. (Para 31 , 32) |
ORDER
The present petition has been filed by the petitioner seeking a direction to the 1st respondent to reimburse a sum of Rs.154,51,98,540/-, being the admitted amount payable towards the subsidy for the purchase of RBD Palmolein Oil from the 2nd respondent vide its proceedings dated 7.3.2019.
2. It is the case of the petitioner that it is engaged in the distribution of essential commodities and also engaged in the procurement of essential commodities from the growers at their door steps. It is the further case of the petitioner that Government of India introduced the scheme of distribution of subsidized edible oil through the Public Distribution Scheme by the State Governments/Union Territories at a subsidized rate of Rs.15/- per Kg., while the market cost of the edible Palmolein oil was Rs.45/-.
3. It is the further case of the petitioner that pursuant to the order of the 1st respondent in No.12/1-2009-C&P dated 7th Nov., 2012, Government of India directed that the supply shall be done by procuring crude oil from the 2nd respondent who shall act as a procuring agency and the supply was intended to be made from 30.09.2012. Government of India had allotted the State’s share at 2,13,600 MT of RBD Palmolein oil for import from off-shore sources.
4. It is the further case of the petitioner that it has purchased RBD Palmolein oil from the respondent Management at a subsidy from M/s.PEC Ltd. Till March, 2013. The respondent Management, vide its letter dated 8.1.2013, informed the petitioner that due to huge amount of differential sum arising out of the subsidy, which was pending with the PDS Ministry, the respondent Management expressed their financial constraints and inability to call or float any new fresh tenders. It is the further case of the petitioner that the 2nd respondent was so reluctant to float tender with subsidy component and the 2nd respondent informed that tender will be floated if the petitioner comes forward and agrees to pay the entire cost upfront and later on claim reimbursement either from the Government or from the 2nd respondent. Therefore, the petitioner prepaid the same on the assurance that it would be reimbursed. However, due to the arrangement being non-viable, the petitioner addressed a letter to the 1st respondent to instruct PEC Ltd., to float tender with subsidy components.
5. It is the further case of the petitioner that the Government of India, vide letter dated 12.7.2013, designated NCCF in place of PEC Ltd., as a procuring agency upto 30.09.2013 for the supply of RBD Palmolein Oil to the State. It is the further case of the petitioner that the total outstanding amount, which is to be recredited to the petitioner by the respondent towards subsidy for 1,03,013.236 MT of Palmolein at the rate of Rs.15,000 per MT is Rs.154,51,98,540, which is pending since April, 2013.
6. With a view to ensure uninterrupted supply of RBD Palmolein Oil under PDS, the petitioner had purchased the oil from M/s.PEC Ltd., without subsidy. Inspite of several follow-up representation made by the petitioner seeking reimbursement of the same, the amount has not been paid till date and the aforesaid amount is still pending payment. It is the further case of the petitioner that Government of India has not extended the scheme of supplying edible oil under subsidized rate beyond 30.09.2013. Therefore, from December, 2013, the petitioner is purchasing Palmolein Oil through tender.
7. It is the further case of the petitioner that Government of India and Sta
