AI Structured Summary
Not yet generated for this judgment
Judgment
Protik Prakash Banerjee, J
This writ court has been approached in its jurisdiction under Article 226 of the Constitution of India, 1950 by four writ petitioners in W.P. No. 337 of 2018, W.P. No. 338 of 2018, W.P. No. 339 of 2018 and W.P. No. 340 of 2018 praying for a writ of mandamus against the respondent authorities for the recovery of price in respect of medicines sold and delivered by the writ petitioners to the respondent no. 6 in all the writ petitions. For the better understanding of the reliefs sought by the writ petitioners in the aforesaid writ petitions, prayer (a) appended to the respective writ petitions have been extracted and set-out herein below:
In W.P. No. 337 of 2018:
(a) A writ in the nature of mandamus do issue commanding the respondents and each one of them, their men, agents and/or assigns to make payment of all outstanding bills raised and submitted by the petitioners against the various work orders for the total amount of Rs. 18,49,734/- (Rupees eighteen lakhs, forty-nine thousand, seven hundred and thirty four only) and such payment to be disbursed to the petitioner no. 1 as expeditiously as possible.
In W.P. No. 338 of 2018:
(a) A writ in the nature of mandamus do issue commanding the respondents and each one of them, their men, agents and/or assigns to make payment of all outstanding bills raised and submitted by the petitioners against the various work orders for the total amount of Rs. 26,76,673/- (Rupees twenty six lakhs, seventy six thousand, six hundred and seventy three only) and such payment to be disbursed to the petitioner no. 1 as expeditiously as possible.
In W.P. No. 339 of 2018:
(a) Issue a writ in the nature of mandamus commanding the respondents no. 1 to forthwith release sum of Rs. 8,69,174/-(Rupees eight lakhs, sixty nine thousand, one hundred and seventy four only) along with interest thereon at such rate as maybe deem fit by this Hon'ble court to the petitioner on account of outstanding bills and/or tax invoices being Annexure "P/2" to this writ petition.
In W.P. No. 339 of 2018:
(a) Issue a writ of or in the nature of mandamus commanding the respondents no. 1 to forthwith release sum of Rs. 10, 56, 000/- (Rupees ten lakhs, fifty six thousand only) along with interest thereon at such rate as maybe deem fit by this Hon'ble court to the petitioner on account of outstanding bills and/or tax invoices being Annexure "P/2" to this writ petition.
Since all the writ petitions being W.P. No. 337 of 2018, W.P. No. 338 of 2018, W.P. No. 339 of 2018 and W.P. No. 340 of 2018 raise common questions of law and fact, with the consent of the parties, I have consolidated them and heard them analogously.
The writ petitioners in all the writ petitioners are partnership firms along with their respective partners engaged in and carrying out the business of supplying medicines. They had approached this court previously in an earlier round of litigation when the writ petitions were dismissed on the sole ground that the Kolkata Municipal Corporation, respondent no. 1 herein, being as a necessary party to the writ petitioners case was not arrayed as a defendant. However, liberty was given to the writ petitioners to file the writ petitions afresh. It is in this manner that the writ petitions came to be heard before this court.
At the outset, it must be noted that the writ petitioners in W.P. No. 337 of 2018 and W.P. No. 338 of 2018was engaged by way of formal work orders issued by the respondent no. 1 through the respondent no. 6 for the necessary supply of medicines with the mode of payment enumerated therein. On the other hand, the arrangement between the writ petitioners in W.P. No. 339 of 2018 and W.P. No. 340 of 2018was based on verbal assurances without the issuance of any formal work order. Keeping in mind the aforesaid distinction, I proceed with these writ petitions.
It is their case that the writ petitioners, as far back as on June 3, 2015, were engaged for the supply of medicines to the respondent no. 1 Corporation through the respondent no. 6 being the Superintendent, Central Medical Stores. The said items were supplied along with the challans for such supply and were received by the respondent no. 6 who duly endorsed the said challans by his seal and signature after due verification and scrutiny of the items of supply. However, when the writ petitioners approached the respondent authorities for making payment for such supplies, the respondent no. 1 refused to disburse the payment in favour of the writ petitioners. The respondent authorities did not respond to several representations made by the petitioners but on a verbal intimation notified the writ petitioners that the payment would be made at the rate specified by the State Government Central Medical Stores which is lower than the rate prescribed in the work orders as mentioned above. Hence, these writ petitions.
At the outset, the respondent authorities raised the question of maintainability of the writ petitions on the ground that the remedy sought by the writ petitioners could only be enforced by a suit for the recovery of money filed with respect to Form No. (3) and (4) to Appendix A of Schedule (I) appended to the Code of Civil Procedure, 1908. This is because the genesis of the claim in case of W.P. No. 337 of 2018 and W.P. No. 338 of 2018lies in the work orders issued to the writ petitioners therein by the respondents no. 1 through the respondent no. 6 and in the case of W.P. No. 339 of 2018 and W.P. No. 340 of 2018 on verbal assurances received by the writ petitioners therein. Therefore, on this ground itself the writ petitions are liable to be dismissed as the writ court cannot be the appropriate forum to adjudicate such contractual claims.
As against the case of the writ petitioners, on merits, the respondent authorities took the stand that the Kolkata Municipal Corporation purchased medicines on rates approved by the State government, and thus, they are not bound to oblige for payment of the bills at the rates prescribed in the said work orders. The writ petitioners being enlisted suppliers of medicines to the medical stores of the respondent no. 1 were fully aware of the state government approved rates yet they proceeded to supply the medicines at an enhanced rate as borne out of the work orders. In support of this, the respondents have placed before this court the audit observation of the Medical & Health Department relating to the procurement and expiry of medicines for the year 2011-12 & 2014-15. Thus, it is the case of the respondents that in the audit observation dated October 15, 2015, these items were found to have been ordered at an enhanced price which was higher than the "approved government rates".
In order to decide the matter finally, this court has to consider whether the writ petitions are not maintainable in law. If yes, then whether the audit observation of October 15, 2015 can relate back to a contract entered into on June 03, 2015 and also whether a unilateral decrease in the rates by the respondent no. 1 can bind the petitioner for he has supplied the medicines in terms of the contract which had been accepted without demur by the respondent no. 1.
Mr. Basu, learned Senior Advocate appearing for the writ petitioners has vehemently opposed the challenge to the maintainability of the writ petitions. It is his submission that remedy under Article 226 of the Constitution is very much available to enforce a contractual obligation of the State or its instrumentality by the writ petitioners. In support of his submissions, he has relied upon a decision of the Hon'ble Supreme Court in ABL International Ltd. and Others-v-
Export Credit Guarantee Corporation of India Ltd. and Others reported in (2004) 3 SCC 553. Therefore, the observation of the Hon'ble Apex Court in the aforesaid judgment being relevant to the determination of the foremost issue in contention in these writ petitions has been cited hereinbelow:
"27. From the above discussion of ours, the following legal principles emerge as to the maintainability of a writ petition:
(a) In an appropriate case, a writ petition as against a State or an instrumentality of a State arising out of a contractual obligation is maintainable.
(b) Merely because some disputed questions of fact arise for consideration, same cannot be a ground to refuse to entertain a writ petition in all cases as a matter of rule.
(c) A writ petition involving a consequential relief of monetary claim is also maintainable."
The writ petitioners have further relied upon a judgment of the Hon'ble Supreme Court in the case of Smt. Gunwant Kaur and Others-v- Municipal Committee, Bhatinda and Others reported in AIR 1970 SC 802 equivalent to MANU/SC/0397/1969, where dealing with a situation of disputed questions of fact in a writ petition the Apex Court held:
"The High Court observed that they will not determine disputed question of fact in a writ petition. But what facts were in dispute and what were admitted could only be determined after an affidavit in reply was filed by the State. The High Court, however, proceeded to dismiss the petition in limine. The High Court is not deprived of its jurisdiction to entertain a petition under Article 226 merely because in considering the petitioner's right to relief questions of fact may fall to be determined: In a petition under Article 226 the High Court has jurisdiction to try issues both of fact and law. Exercise of the jurisdiction is it is true, discretionary, but the discretion must be exercised on sound judicial principles. When the petition raises questions of fact of a complex nature, which may for their determination require oral evidence to be taken, and on that account the High Court is of the view that the dispute may not appropriately be tried in a writ petition, the High Court may decline to try a petition. Rejection of a petition in limine will normally be justified, where the High Court is of the view that the petition is frivolous or because of the nature of the claim made dispute sought to be agitated, or that the petition against the party against whom relief is claimed is not maintainable or that the dispute raised thereby is such that it would be inappropriate to try it in the writ jurisdiction, or for analogous reasons.
From the averments made in the petition filed by the appellants it is clear that in proof of a large number of allegations the appellants relied upon documentary evidence and the only matter in respect of which conflict of facts may possibly arise related to the due publication of the notification under Section 4 by the Collector, In the present case, in our judgment, the High Court was not justified in dismissing the petition on the ground that it will not determine disputed question of fact. The High Court has jurisdiction to determine questions of fact, even if they are in dispute and the present, in our judgment, is a case in which in the interests of both the parties the High Court should have entertained the petition and called for an affidavit in reply from the respondents, and should have proceeded to try the petition instead of relegating the appellants to a separate suit."
This court is bound by the law settled by the Hon'ble Supreme Court. Since in the instant case the writ petitioners seek relief in respect of a right arising initially in a contract against an arbitrary and unlawful action on the part of a public authority I agree with the submissions made by the learned counsel for the writ petitioners that the writ petitions can be entertained before this writ court by invoking Article 226 of the Constitution.
Moving on, the next issue which has been argued before this court is whether the audit observation of October 15, 2015 can relate back to a contract entered into on June 03, 2015. At the time of the hearing, the respondent authorities were given opportunity to produce original records of the case including the price for procurement as prescribed by the government and documents to show that these were accepted by the respondent no. 1 before June, 2015, if at all available and how these were communicated to the writ petitioners before entering into the contract and also what steps have been taken against the then Superintendent, Central Medial Stores, Kolkata Municipal Corporation as alleged by the respondents in their opposition. However, despite opportunity being granted to the Respondent corporation, by my order dated July 25, 2019 and the extended time granted on August 8, 2019, it could not produce any document to show that the rates allegedly prescribed by the Government was made known to the petitioner before June 3, 2015 or that it had taken any step against the-then Superintendent, or even that the so-called prescribed rates had been made known to the public at large before June 3, 2015 from which the petitioners could have been deemed to have knowledge. The documents discovered by the affidavit on behalf of the respondents No.1 to 6 affirmed on September 9, 2019 do not contain any such document or record as would support of the above allegations of the respondent corporation. Thus on records, where records must exist if the allegation was true, the respondent corporation could not establish its case on merits. Therefore, it is clear that even though there was a change in the prescribed rates of procurement of medicines as shown by the audit observation dated October 15, 2015, such unilateral change in the rates by the respondent no. 1 cannot bind the petitioner for he has supplied the medicines in terms of the contract in the first two cases as referred to in paragraph 1 of this judgment, which supply had been accepted without demur by the respondent no. 1. Besides, there is nothing to prove that such change existed on or before June, 2015 or that the writ petitioners had sufficient knowledge of it. In such view of the matter, I hold that no other rates apart from the rates prescribed in the work orders issued to them by the respondent authorities would be applicable to the writ petitioners. Therefore, the amounts payable to the petitioners in terms of the work order, being liquidated sums, and since I have held that on merits the respondent corporation could not establish that the supply was or ought to be deemed to have been made at any rate other than those mentioned in the work orders were payable, and since the respondents have not disputed the arithmetic of the petitioners as to the amount payable for the supplies made under the said work orders, must be held to be the sums mentioned in prayer (a) of WP No.337 of 2018 and W.P. No.338 of 2018.
Since, valid work orders have only been issued in favour of the writ petitioners in W.P. No. 337 of 2018 and W.P. No. 338 of 2018, the above findings are restricted to the claims made therein.
Thus, I allow the writ petitions in W.P. No. 337 of 2018 and W.P. No. 338 of 2018 and there shall be orders in terms prayer (a) in both the said writ petitions. The payment as directed must be made within a fortnight from the date of communication of this order. There shall be no order as to costs.
W.P. No. 339 of 2018 and W.P. No. 340 of 2018
In respect to the claims made by the writ petitioners in W.P. No. 339 of 2018 and W.P. No. 340 of 2018, Mr. Basu contends that even if no valid work orders have been issued in favour of the writ petitioners therein, the rates specified in the work orders issued to the writ petitioners in W.P. No. 337 of 2018 and W.P. No. 338 of 2018 would be applicable in these writ petitions as well. It is his case that since the medicines supplied is similar in nature to those supplied under the work orders as above, the same rates should be applicable to the writ petitioners in 339 of 2018 and W.P. No. 340 of 2018 even in the absence of valid work orders in their favour. He further submits that since the other two writ petitioners have supplied the medicines under a verbal assurance received by the respondent no. 6 and such medicines have been accepted without demur, the respondent no. 1 cannot avoid liability under such circumstances and deny payment to the writ petitioners. In support of his submissions, he cited section 70 of the Indian Contract Act, 1872 which lays down the following:
Section 70 - Obligation of person enjoying benefit of non-gratuitous act
Where a person lawfully does anything for another person, or delivers anything to him, not intending to do so gratuitously, and such other person enjoys the benefit thereof, the latter is bound to make compensation to the former in respect of, or to restore, the thing so done or delivered.
While I agree with the contentions advanced by Mr. Bose in a broader context, I find it difficult to appreciate his submissions in the facts and circumstances of the latter two writ petitions. As rightly pointed out by Mr. Ghosh, learned counsel for the respondent no. 1, the aforesaid provision of law pertains to assessment of compensation, which cannot be ascertained by a writ court, since, firstly, it is not a matter of constitutional tort and, secondly, because it is in the arena of a civil dispute as to how much would be payable. He also submits that under section 70, the respondent no. 1 ought to have been given the right to elect whether to retain the benefit or to pay compensation which cannot be done in the writ court since here compensation cannot be assessed. Mr. Basu counters this by saying that the medicines supplied must have crossed the expiry date by now, which would appear from the dates of manufacture in the packaging, and so the question of its return would not arise, since the goods are not in the position where they can be utilized by the petitioners for sale to others, and hence it must be deemed that the respondents have taken the benefit of such supply. If that be the case, compensation would be the only answer. Even otherwise, whether each medicine has crossed the expiry date, is a question of evidence which must be adduced and there is nothing on record to show it. Therefore, it is not a case which can be conveniently decided by the writ court under Article 226 of the Constitution of India and this requires evidence, by way of witness action and oral evidence, as to what the compensation ought to be and whether the medicines have crossed their respective expiry dates. Therefore, in line with the decision in Gunwant Kaur (supra), I decline jurisdiction to try the W.P. No. 339 of 2018 and W.P. No. 340 of 2018 under Article 226 of the Constitution of India, and relegate the petitioners to the appropriate alternative remedy as available in law, before the competent civil court, if so advised.
The writ petitions are disposed with the aforesaid observations. There shall be no order as to costs.
A duly authenticated server copy of this order shall be retained in the files of WP No.337 of 2018, W. P. No.338 of 2018, W.P. No.339 of 2018 and W.P. No.340 of 2018.
(Protik Prakash Banerjee, J.)
Later: On the prayer of Mr. Ghosh, learned senior counsel appearing for the Corporation, the time to make payment as in paragraph 14 of this judgment is extended by a period of four weeks after reopening of Court after long vacation.