M/S Niraj Cement Strucurals Ltd vs Union Of India And Others

Kh. Nobin Singh, J

[1] Heard Shri H.S. Paonam, learned Senior Advocate appearing for the petitioner; Shri S. Suresh, learned ASG appearing for the respondent Nos.1 and 2 and Shri Abir Phukan, learned counsel appearing for the respondent Nos. 3 and 4.

[2] By the instant writ petition, the petitioner has prayed for issuing a writ of certiorari or any other appropriate writ to quash and set aside the letters dated 21.12.2018 and 24.12.2018 and also to direct the respondent No.1 to cause investigation into the practical viability of the DPR prepared by respondent No.3 for execution of the project.

[3.1] Facts and circumstances of the case as narrated in the writ petition, are that the Union of India issued a Notification 03.04.2017 inviting tenders from eligible contractors for construction of 69 bridges, along with approach roads, on the Tamu-Kyigone-Kalewa road section, from Km. 149.700 to Trilateral Highway, in Myanmar. After the bids were opened, an agreement dated 08.11.2017 was entered into between the Ministry of External Affairs represented by its Joint Secretary (DPA-III) and M/S NCSL- MTDC JV(M/S Niraj Cement Structurals Ltd. in JV with M/s Manipur Tribal Development Corporation Ltd) through its authorized signatories. A letter of acceptance was issued to the petitioner on 16.10.2018 for a contract price of Rs.293,93,55,588/- (Rupees two hundred ninety three crores ninety three lakhs fifty-five thousand five hundred eighty eight only).

[3.2] After entering into the contract, the petitioner came to know that there were many variations in the data furnished in tender documents like in the reference pillars of the bridge, HFL, sub soil conditions, survey alignment details and sub soil investigations because of which the petitioner could not proceed with the work and accordingly, the petitioner approached the Authority Engineer who was informed about the discrepancy in the topographic survey done for Bridge No.1 using the newly established GPS pillars near the bridge and the coordinates of centre line co-ordinates provided to the petitioner vide its letter 21.05.2018. A request was also made by the petitioner for initiating process for data collection of HFL making on all the bridges jointly with IRCON and MOC team and also for plan profile survey of all major bridges so that alignment design work can be started vide e-mail dated 21.08.2018.

[3.3] Overlooking the discrepancies, the authority Engineer served a show cause notice upon the petitioner as to why an action should not be taken up against it in terms of the contract including the termination of contract within 7 (seven) days with a condition that upon failure to receive any satisfactory reply from the petitioner, it would recommend to the authority concerned for termination of contract vide letter dated 02.11.2018. The petitioner submitted its reply on 23.11.2018 stating that a considerable progress in all aspects had been made as committed on 25.06.2018 at a joint meeting and requested to the Authority Engineer to visit the side and make their assessment. Without considering the reply, a notice of 15 days was served upon the petitioner vide letter dated 26.11.2018 for termination of the contracts on the alleged failure to comply with the notices to satisfactorily commence the work with adequate progress being shown thereof. The petitioner submitted its reply dated 11.12.2018 stating the events and circumstances for the delay which are not attributable to it.

[3.4] To the utter shock and surprise of the petitioner, the respondents approached Punjab National Bank to encash two bank guarantees for transferring the amount in the account of the Ministry of External Affairs through RTGS vide its letter dated 21.12.2018. Since the request was made without enclosing the document relating to termination of contract, the bank officials requested for a copy of the termination letter and accordingly, the respondents furnished a copy of termination letter dated 24-12-2019 before the same was communicated to the petitioner. Being aggrieved by the said two letters dated 21.12.2018 and 24.12.2018, the instant writ petition has filed by the petitioner.

[4] An affidavit-in-opposition on behalf of respondents was filed raising a preliminary objection as regards the maintainability of the writ petition praying that the writ petition should not be entertained by this Court and that it should be quashed as per the EPC agreement signed between the authority and the petitioner. As seen from the affidavit, there are three main grounds on the basis of which the issue of maintainability was raised by them. Firstly, the Hon‟ble Courts in Delhi have got the exclusive jurisdiction to adjudicate the issue involved herein as per article 27.1 of the Contract Agreement and in view of the said article, this Court is not the appropriate court having the territorial jurisdiction to entertain the writ petition. Article 27.1 reads as under;

"27.1. This agreement shall be construed and interpreted in accordance with and governed by the laws of India, and the Courts at Delhi shall have exclusive jurisdiction over matters arising out of or relating to this Agreement."

Secondly, it is settled law that the disputes relating to the contract and its terms, cannot be agitated in a writ petition. This court is not the appropriate forum to adjudicate commercial disputes. Moreover, there exist an arbitration clause/ provision in the agreement for adjudication of the dispute. Thus, the Petitioner has got an alternate and efficacious remedy as per Article 26 of the EPC agreement. Since the petitioner has got efficacious remedy under Arbitration and Conciliation Act 1996, no injunction can be granted under Section 41(h) of the Specific Relief Act, 1963. The relevant clauses read as under.

"26.3.1 Any Dispute which is not resolved amicably by conciliation, as provided in Clause 26.2 shall be finally decided by reference to arbitration in accordance with the rules of arbitration of the SOCIETY FOR AFFORDABLE REDRESSAL OF DISPUTES (SAROD).

26.3.3 The arbitrators shall make a reasoned award (the "Award"). Any Award made in any arbitration held pursuant to this Article 26 shall be final and binding on the Parties as from the date it is made, and the Contractor and the Authority agree and undertake to carry such Award without delay.

26.3.4 The Contractor and the Authority agree that an Award may be enforced against the Contractor and/or the Authority; as the case may be, and their respective assets whatever situated."

Thirdly, no relief as prayed for by the petitioner in its writ petition can be granted under Section 14 read with Section 20 A of the Specific Relief Act, 1963. Section 14 and 20 A of the Specific Relief Act, 1963 reads as under:

"Section 14 of the Specific Relief Act, 1963 Contracts not Specifically Enforceable-The following contracts cannot be specifically enforced namely:-

(a) Where a party to the contract has obtained substituted performance of the contract in accordance with the provisions of Section 20.

(b) A contract, the performance of which involves the performance of a continuous duty which the court cannot supervise;

(c) A contract which is so dependent on the personal qualifications of the parties that the court cannot enforce specific performance of its material terms; and

(d) A contract which is in its nature determinable.

"Section 20A of the Specific Relief Act, 1963 Specific provisions for contract relating to infrastructure project-

(1) No injunction shall be granted by a court in a suit under this Act involving a contract relating to an infrastructure project specified in the schedule, where granting injunction would cause impediment or delay in the progress or completion of such infrastructure project.

Explanation:- for the purpose of this section and section 20-B and clause (ha) of section 41, the expression

"infrastructure project" means the category of projects and infrastructure sub- sectors specified in the Schedule."

[5] Since an objection as regards the maintainability of the writ petition has been raised by the respondents, this court deems it appropriate to consider the same before going into the merit of the case. The short issue that arises for consideration by this court is as to whether a part of the cause of action arose within the territorial jurisdiction of this Court.

[6] It has been submitted by Shri Abir Phukan, learned counsel appearing for the respondent Nos. 3 & 4 that no cause of action, and not even a part thereof, arose within the territorial jurisdiction of this Court for the reason that the notice inviting tender was issued in New Delhi; the tenders were received and scrutinized in New Delhi; the bid submitted by the petitioner was accepted in New Delhi; the contract was executed in New Delhi and was to be performed in Myanmar and that the show cause notices and the letter terminating the contract, were issued in New Delhi. It has further been submitted by him that there is not a single plea in the writ petition that the cause of action arose in Manipur; that in the rejoinder, it has been admitted by the petitioner that the Delhi Courts will have the jurisdiction but since the High Court of Delhi remained closed for vacation, the instant writ petition was filed before this Court which is factually incorrect because the vacation bench was available at High Court of Delhi and that since the petitioner has alternative remedy available in terms of various clauses incorporated in the agreement and the provisions of the Arbitration and Conciliation Act, 1996, this Court may refuse to exercise its jurisdiction. Moreover, in a contract like the present one where the disputed questions of facts are involved, this court will have to be slow in interfering it. In support of his contention, he has relied upon various decisions rendered by the Hon‟ble Supreme Court. The submissions as advanced by Shri S. Suresh, ASG appearing for the respondent Nos. 1 & 2, are similar to that of Shri Abir Phukan and therefore, the same are not repeated here for the sake of brevity.

[7] On the other hand, it has been submitted by Shri H.S.Paonam, the learned Senior Advocate appearing for the petitioner that the cause of action arose partly within the territorial jurisdiction of this Court for the reason that the offer was accepted by e-mail; that half of the 1st bridge to be constructed on the border between India and Myanmar falls on the side of Moreh which is within the territorial jurisdiction of this Court; that the arbitration cause contained in the agreement does not state that only the Delhi Courts will have jurisdiction; that the writ petition is maintainable, since the action of the respondents terminating the contract was arbitrary; that one of the partner/ associate in the JV with the petitioner is the MTDC, Manipur; that the schedule of rates applicable to the State of Manipur is adopted and that the rule of exclusion of writ jurisdiction by availability of alternative remedy is a rule of discretion and not of compulsion.

[8] The grounds on which the issue of maintainability of the writ petition being raised by the counsel appearing for the respondents, can be considered and categorized into two-one, no part of cause of action arose within the territorial jurisdiction of this court and two, this Court shall not entertain the writ petition because the petitioner has got an alternative remedy as per the clauses/ provisions incorporated in the agreement or the provisions of the Specific Relief Act or the issue involved is a contractual one. This second category will arise in a case where the territorial jurisdiction of the High Court under the provisions of Article 226 of the Constitution of India is not in dispute. Many of the decisions relied upon by the learned counsel appearing for the parties fall in this category. In M/S Radhakrishna Agarwal & ors. Vs. State of Bihar & ors, (1977) 3 SCC 457, the Hon‟ble Supreme Court held:

"10. It is thus clear that the Erusian Equipment & Chemicals Ltd‟s case (supra) involved discrimination at the very threshold or at the time of entry into the field of consideration of persons with whom the Government could contract at all. At this stage, no doubt, the State acts purely in its executive capacity and is bound by the obligations which dealings of the State with the individual citizens import into every transaction entered into in exercise of its constitutional powers. But, after the State or its agents have entered into the field of ordinary contract, the relations are no longer governed by the constitutions provisions but by the legally valid contract which determines rights and obligations of the parties inter se. No questions arises for violation of Article 14 or of any other constitutional provision when the State or its agents, purporting to act within this field, perform any act. In this sphere, they can only claim rights conferred upon them by contract and are bound by the terms of the contract only unless some statute steps in an confers some special statutory power or obligation on the State in the contractual field which is apart from contract."

In Smt. Rukmanibai Gupta Vs. Collector, Jabalpur & ors, (1980) 4 SCC 556, the Hon‟ble Supreme Court held:

"10. Arbitration Act, 1940, is a self-contained and exhaustive code. It provides for filing arbitration agreement to the jurisdiction of court, appointment and removal of arbitrator by court, making award a rule of court, remitting or setting aside an award etc. Where the arbitrator has made an award it can be questioned under Section 33. Section 32 bars a suit on any ground whatsoever for contesting an award and further provides that no award shall be enforced, set aside, amended, modified or in any way affected otherwise than as provided in the Arbitration Act itself. Thus, Arbitration Act, 1940, is a self-contained exhaustive code. Relief sought by the appellant by involving extraordinary jurisdiction of the High Court under Article 226 could have been obtained by proceeding in accordance with the relevant provisions of the Arbitration Act. In this situation, if the High Court declined to entertain the writ petition, no exception can be taken to it. Further the indenture of lease constitutes a contract between the parties. Right to excavate limestone from leased area and obligation to pay royalty under the relevant Minor Mineral Rules arise from the contract. The contract provided for resolution of dispute arising out of the carrying out of contract. The writ jurisdiction of the High Court under Article 226 of the Constitution is not intended to facilitate avoidance of obligation voluntarily incurred, (see Har Shankar v. Dy. Excise & Taxation Commissioner)."

In Whirlpool Corporation Vs. Registrar of Trade Marks, Mumbai & ors., (1998) 8 SCC 1, the Hon‟ble Supreme Court held:

"14. The power to issue prerogative writs under Article 226 of the Constitution is plenary in nature and is not limited by any other provision of the Constitution. This power can be exercised by the High Court not only for issuing writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari for the enforcement of any of the Fundamental Rights contained in Part III of the Constitution but also for "any other purpose".

Under Article 226 of the Constitution, the High Court, having regard to the facts of the case, has a discretion to entertain or not to entertain a writ petition. But the High Court has imposed upon itself certain restrictions one of which is that if an effective and efficacious remedy is available, the High Court would not normally exercise its jurisdiction. But the alternative remedy has been consistently held by this Court not to operate as a bar in at least three contingencies, namely, where the writ petition has been filed for the enforcement of any of the Fundamental Rights or where there has been a violation of the principle of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is challenged. There is a plethora of case-law on this point but to cut down this circle of forensic whirlpool, we would rely on some old decisions of the evolutionary era of the constitutional law as they still hold the field."

In Harbanslal Sahnia & anr. Vs. Indian Oil Corporation Ltd & ors., (2003) 2 SCC 107, the Hon‟ble Supreme Court held:

"7. So far as the view taken by the High Court that the remedy by way of recourse to arbitration clause was available to the appellants and therefore the writ petition filed by the appellants was liable to be dismissed is concerned, suffice it to observe that the rule of exclusion of writ jurisdiction by availability of an alternative remedy is a rule of discretion and not one of compulsion. In an appropriate case, in spite of availability of the alternative remedy, the High Court may still exercise its writ jurisdiction in at least three contingencies: (i) where the writ petition seeks enforcement of any of the fundamental rights; (ii) where there is failure of principles of natural justice; or (iii) where the orders or proceedings are wholly without jurisdiction or the vires of an Act is challenged. (See Whirlpool Corpn. v. Registrar of Trade Marks1.) The present case attracts applicability of the first two contingencies. Moreover, as noted, the petitioners‟ dealership, which is their bread and butter, came to be terminated for an irrelevant and non-existent cause. In such circumstances, we feel that the appellants should have been allowed relief by the High Court itself instead of driving them to the need of initiating arbitration proceedings.

In Empire Jute Company Ltd. & ors. Vs. Jute Corporation of India Ltd. & anr., (2007) 14 SCC 680, the Hon‟ble Supreme Court held:

"14. Construction of the contract entered into by and between the parties is in question before us. There exists an arbitration agreement. The arbitration agreement is of wide amplitude; by reason whereof not only the dispute relating to quality of the jute sought to be supplied by Respondent 1 may be gone into, the construction, meaning and operation and effect of the contract or breach thereof, if any, would have also fallen for determination of an arbitrator.

It is not correct to contend that Clause 8.0 provides for procedure for claim settlement. The said provision in regard to the quality of jute supplied has in our opinion nothing to do with Clause 9.0. The arbitration agreement entered into by and between the parties is independent of Clause 8.0. It is now well settled that when there exists an arbitration agreement, the writ court ordinarily would not exercise its discretionary jurisdiction to enter into the dispute."

In Union of India & ors. Vs. Tantia Construction Private Ltd., (2011) 5 SCC 697 the Hon‟ble Supreme Court held:

"33. Apart from the above, even on the question of maintainability of the writ petition on account of the arbitration clause included in the agreement between the parties, it is now well established that an alternative remedy is not an absolute bar to the invocation of the writ jurisdiction of the High Court or the Supreme Court and that without exhausting such alternative remedy, a writ petition would not be maintainable. The various decisions cited by Mr. Chakraborty would clearly indicate that the constitutional powers vested in the High Court or the Supreme Court cannot be fettered by any alternative remedy available to the authorities. Injustice, whenever and wherever it takes places, has to be struck down as an anathema to the rule of law and the provisions of the constitution.

In S.J.S Business Enterprises (P) Ltd Vs. State of Bihar & ors., (2004) 7 SCC 166, the Hon‟ble Supreme Court held that the existence of an adequate or suitable alternative remedy available to a litigant is a factor which a court entertaining an application under Article 226 of the Constitution will consider for exercising the discretion to issue a writ under Article 226. But the existence of such remedy does not impinge upon the jurisdiction of the High Court to deal with the matter itself, if it is in apposition to do so on the basis of the affidavits filed.

In L. Chandrakumar Vs. Union of India & ors., (1997) 3 SCC 261, the Hon‟ble Supreme Court held that the jurisdiction conferred upon the High Courts under Articles 226/ 227 and upon the Supreme Court under Article 32 of the Constitution is a part of the inviolable basis structure of our constitution. While this jurisdiction cannot be ousted, other courts and tribunals may perform a supplemental role in discharging the powers conferred by articles 226/227 and 32 of the Constitution.

In Asia Foundation & Construction Ltd. Vs. Trafalgar House Construction (I) Ltd. & ors., (1997) 1 SCC 738, the Hon‟ble Supreme Court held that though the principle of judicial review cannot be denied so far as exercise of contractual powers of government bodies are concerned, it is intended to prevent arbitrariness or favouritism and it is exercised in the larger public interest or if it is brought to the notice of the court that in the matter of award of a contract, power has been exercised for any collateral purpose.

In Noble Resources Ltd. Vs. State of Orissa & ors., (2006) 10 SCC 236, the Hon‟ble Supreme Court held:

"15. It is trite that if an action on the part of the State is violative of the equality clause contained in Article 14 of the Constitution of India, a writ petition would be maintainable even in the contractual field. A distinction indisputably must be made between a matter which is at the threshold of a contract and a breach of contract; whereas in the former the court‟s scrutiny would be more intrusive, in the latter the court may not ordinarily exercise its discretionary jurisdiction of judicial review, unless it is found to be violative of Article 14 of the Constitution. While exercising contractual powers also, the government bodies may be subjected to judicial review in order to prevent arbitrariness or favouritism on their part. Indisputably, inherent limitations exist, but it would not be correct to opine that under no circumstances a writ will lie only because it involves a contractual matter.

It may, however, be true that where serious disputed questions of fact are raised requiring appreciation of evidence, and, thus, for determination thereof, examination of witnesses would be necessary; it may not be convenient to decide the dispute in a proceeding under Article 226 of the Constitution of India.

Contractual matters are, thus, not beyond the realm of judicial review. Its application may, however, be limited."

In Shriram City Union Finance Corporation Ltd. Vs. Rama Mishra, (2002) 9 SCC 613, the Hon‟ble Supreme Court held that a party is bound either by provisions of the Constitution, statutory provisions or any rule or under the terms of any contract which is not against public policy. It is open for a party for his convenience to fix the jurisdiction of any competent court to have their disputes adjudicated by that court alone. In other words, if one or more courts have the jurisdiction to try any suit, it is open for the parties to choose anyone of the two competent courts to decide their disputes. In case parties under their own agreement expressly agree that their dispute shall be tried by onely one of them, then the parties can only file the suit in that court alone to which they have so agreed.

The above decision has been followed in New Moga Transport Co. Vs. United India Insurance Co. Ltd & ors., (2004) 4 SCC 677.

In Indus Mobile Distribution Private Limited Vs. Datawind Innovations Private Limited & ors., (2017) 7 SCC 678, the Hon‟ble Supreme Court held:

"20. It is well settled that where more than one court has jurisdiction, it is open for the parties to exclude all other courts. For an exhaustive analysis of the case law, see Swastik Gases (P) Ltd. v. Indian Oil Corpn. Ltd. This was followed in a recent judgment in B.E. Simoese Von Staraburg Niedenthal v. Chhattisgarh Investment Ltd. Having regard to the above, it is clear that Mumbai courts alone have jurisdiction to the exclusion of all other courts in the country, as the juridical seat of arbitration is at Mumbai. This being the case, the impugned judgment is set aside. The injunction confirmed by the impugned judgment will continue for a period of four weeks from the date of pronouncement of this judgment, so that the respondents may take necessary steps under Section 9 in the Mumbai Court. The appeals are disposed of accordingly."

In ABL International Ltd & anr. Vs. Export Credit Guarantee Corporation of India Ltd & ors., (2004) 3 SCC 553, the Hon‟ble Supreme Court held:

"23. It is clear from the above observations of this Court, once the State or an instrumentality of the State is a party of the contract, it has an obligation in law to act fairly, justly and reasonably which is the requirement of Article 14 of the Constitution of India. Therefore, if by the impugned repudiation of the claim of the appellants the first respondent as an instrumentality of the State has acted in contravention of the abovesaid requirement of Article 14, then we have no hesitation in holding that a writ court can issue suitable directions to set right the arbitrary actions of the first respondent. In this context, we may note that though the first respondent is a company registered under the Companies Act, it is wholly owned by the Government of India. The total subscribed share capital of this Company is 2,50,000 shares out of which 2,49,998 shares are held by the President of India while one share each is held by the Joint Secretary, Ministry of Commerce and Industry and Officer on Special Duty, Ministry of Commerce and Industry respectively. The objects enumerated in the memorandum of association of the first respondent at para 10 read:

"To undertake such functions as may be entrusted to it by the Government from time to time, including grant of credits and guarantees in foreign currency for the purpose of facilitating the import of raw materials and semi-finished goods for manufacture or processing goods for export."

Para 11 of the said object reads thus:

"To act as agent of the Government, or with the sanction of the Government on its own account, to give the guarantees, undertake such responsibilities and discharge such functions as are considered by the Government as necessary in national interest."

In Municipal Corporation, Ujjain & anr. Vs. BVG India Limited & ors., (2018) 5 SCC 462, the Hon‟ble Supreme Court held:

"9. The principles which have to be applied in judicial review of administrative decisions, especially those relating to acceptance of tender and award of contract, have been considered in great detail by this Court in Tata Cellular v. Union of India, wherein this Court observed that the principles of judicial review would apply to the exercise of contractual powers by government bodies in order to prevent arbitrariness or favouritism. However, there are inherent limitations in exercise of that power of judicial review. The Government is the guardian of the finances of the State. It is expected to protect the financial interest of the State. The right to refuse the lowest or any other tender is always available to the Government. But, the principles laid down in Article 14 of the Constitution have to be kept in view while accepting or refusing a tender. There can be no question of infringement of Article 14 if the Government tries to get the best person or the best quotation. The right to choose cannot be considered to be an arbitrary power. Of course, if the said power is exercised for any collateral purpose, the exercise of that power will be struck down.

The modern trend points to judicial restraint in administrative action. The Court does not sit as a court of appeal but merely reviews the manner in which the decision was made. The Court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted, it will be substituting its own decision without the necessary expertise which itself may be fallible. The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or a quasi-administrative sphere. However, the decision must not only be tested by the application of the Wednesbury principle of reasonableness, but must also be free from arbitrariness and not affected by bias or actuated by mala fides. [See the judgment in Master Marine Services (P) Ltd. v. Metcalfe & Hodgkinson (P) Ltd.]

It is well settled that the award of contract, whether it is by a private party or by a public body or by the State, is essentially a commercial transaction. In arriving at a commercial decision, the considerations which are of paramount importance are commercial considerations. These would include, inter alia, the price at which the party is willing to work; whether the goods or services offered are of the requisite specifications; and whether the person tendering the bid has the ability to deliver the goods or services as per the specifications. It is also by now well settled that the authorities/State can choose its own method to arrive at a decision and it is free to grant any relaxation for bona fide reasons, if the tender conditions permit such a relaxation.

The State, its corporations, instrumentalities and agencies have a public duty to be fair to all concerned. Even when some defect is found in the decision-making process, the court must exercise its discretionary power under Article 226 with great caution and should exercise them only in furtherance of public interest and not merely on the making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should interfere. (See the judgment in Air India Ltd. v. Cochin International Airport Ltd.)."

In K.D. Sharma Vs. Steel Authority of India & ors., (2008) 12 SCC 481, the Hon‟ble Supreme Court held:

"34. The jurisdiction of the Supreme Court under Article 32 and of the High Court under Article 226 of the Constitution is extraordinary, equitable and discretionary. Prerogative writs mentioned therein are issued for doing substantial justice. It is, therefore, of utmost necessity that the petitioner approaching the writ court must come with clean hands, put forward all the facts before the court without concealing or suppressing anything and seek an appropriate relief. If there is no candid disclosure of relevant and material facts or the petitioner is guilty of misleading the court, his petition may be dismissed at the threshold without considering the merits of the claim."

[9] There is no and can be no any dispute amongst the parties as regards the law laid down by the Hon‟ble Supreme Court in the above decisions but the question of their application will arise only after the first category being considered by this court and the outcome thereof is known. In other words, the application of these decisions will have to be considered in the event of a finding being arrived at by this court that this Court has the territorial jurisdiction to entertain the writ petition and not otherwise. As regards the issue as to whether this Court has any territorial jurisdiction, the stances of the parties are contradictory, in the sense that while the stand of the petitioner is that this court has the territorial jurisdiction, the same has been denied by the respondents which have submitted that no cause of action arose within the territorial limits of this court. In Oil and Natural Gas Commission Vs. Utpal Kumar Basu & ors., (1994) 4 SCC 711, the Hon‟ble Supreme Court, after examining the cause of action as envisaged in Article 226 of the

Constitution of India, held:

"6. It is well settled that the expression "cause of action" means that bundle of facts which the petitioner must prove, if traversed, to entitle him to a judgment in his favour by the Court. In Chand Kour v. Partab Singh Lord Watson said:

"... the cause of action has no relation whatever to the defence which may be set up by the defendant, nor does it depend upon the character of the relief prayed for by the plaintiff. It refers entirely to the ground set forth in the plaint as the cause of action, or, in other words, to the media upon which the plaintiff asks the Court to arrive at a conclusion in his favour."

Therefore, in determining the objection of lack of territorial jurisdiction the court must take all the facts pleaded in support of the cause of action into consideration albeit without embarking upon an enquiry as to the correctness or otherwise of the said facts. In other words the question whether a High Court has territorial jurisdiction to entertain a writ petition must be answered on the basis of the averments made in the petition, the truth or otherwise whereof being immaterial. To put it differently, the question of territorial jurisdiction must be decided on the facts pleaded in the petition. Therefore, the question whether in the instant case the Calcutta High Court had jurisdiction to entertain and decide the writ petition in question even on the facts alleged must depend upon whether the averments made in paragraphs 5, 7, 18, 22, 26 and 43 are sufficient in law to establish that a part of the cause of action had arisen within the jurisdiction of the Calcutta High Court.

From the facts pleaded in the writ petition, it is clear that NICCO invoked the jurisdiction of the Calcutta High Court on the plea that a part of the cause of action had arisen within its territorial jurisdiction. According to NICCO, it became aware of the contract proposed to be given by ONGC on reading the advertisement which appeared in the Times of India at Calcutta. In response thereto, it submitted its bid or tender from its Calcutta office and revised the rates subsequently. When it learnt that it was considered ineligible it sent representations, including fax messages, to EIL, ONGC, etc., at New Delhi, demanding justice. As stated earlier, the Steering Committee finally rejected the offer of NICCO and awarded the contract to CIMMCO at New Delhi on 27-1-1993. Therefore, broadly speaking, NICCO claims that a part of the cause of action arose within the jurisdiction of the Calcutta High Court because it became aware of the advertisement in Calcutta, it submitted its bid or tender from Calcutta and made representations demanding justice from Calcutta on learning about the rejection of its offer. The advertisement itself mentioned that the tenders should be submitted to EIL at New Delhi; that those would be scrutinised at New Delhi and that a final decision whether or not to award the contract to the tenderer would be taken at New Delhi. Of course, the execution of the contract work was to be carried out at Hazira in Gujarat. Therefore, merely because it read the advertisement at Calcutta and submitted the offer from Calcutta and made representations from Calcutta would not, in our opinion, constitute facts forming an integral part of the cause of action. So also the mere fact that it sent fax messages from Calcutta and received a reply thereto at Calcutta would not constitute an integral part of the cause of action. Besides the fax message of 15-1-1993, cannot be construed as conveying rejection of the offer as that fact occurred on 27-1-1993. We are, therefore, of the opinion that even if the averments in the writ petition are taken as true, it cannot be said that a part of the cause of action arose within the jurisdiction of the Calcutta High Court."

Relying upon the above decision, the Hon‟ble Supreme Court in Nawal Kishore Sharma Vs. Union of India & ors., (2014) 9 SCC 329, held:

"16. Regard being had to the discussion made hereinabove, there cannot be any doubt that the question whether or not cause of action wholly or in part for filing a writ petition has arisen within the territorial limit of any High Court has to be decided in the light of the nature and character of the proceedings under Article 226 of the Constitution. In order to maintain a writ petition, the petitioner has to establish that a legal right claimed by him has been infringed by the respondents within the territorial limit of the Court‟s jurisdiction."

In Alchemist Ltd. & anr. Vs. State Bank of Sikkim & ors., (2007) 11 335, the Hon‟ble Supreme Court examined the legislative history of the constitutional provisions and in particular, Article 226 (2) of the Constitution of India with reference to „cause of action‟ and held:

"20. It may be stated that the expression "cause of action" has neither been defined in the Constitution nor in the Code of Civil Procedure, 1908. It may, however, be described as a bundle of essential facts necessary for the plaintiff to prove before he can succeed. Failure to prove such facts would give the defendant a right to judgment in his favour. Cause of action thus gives occasion for and forms the foundation of the suit.

The classic definition of the expression "cause of action" is found in Cooke v. Gill wherein Lord Brett observed:

"Cause of action‟ means every fact which it would be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgment of the court."

The learned counsel for the respondents referred to several decisions of this Court and submitted that whether a particular fact constitutes a cause of action or not must be decided on the basis of the facts and circumstances of each case. In our judgment, the test is whether a particular fact(s) is (are) of substance and can be said to be material, integral or essential part of the lis between the parties. If it is, it forms a part of cause of action. If it is not, it does not form a part of cause of action. It is also well settled that in determining the question, the substance of the matter and not the form thereof has to be considered.

From the aforesaid discussion and keeping in view the ratio laid down in a catena of decisions by this Court, it is clear that for the purpose of deciding whether facts averred by the appellant-petitioner would or would not constitute a part of cause of action, one has to consider whether such fact constitutes a material, essential, or integral part of the cause of action. It is no doubt true that even if a small fraction of the cause of action arises within the jurisdiction of the court, the court would have territorial jurisdiction to entertain the suit/petition. Nevertheless it must be a "part of cause of action", nothing less than that."

[10] Article 226(2) of the Constitution of India provides that the power as conferred under clause (1) may be exercised by the High Court within the territorial limits within which the cause of action, wholly or in part, arises. In other words, to exercise the power under Article 226 (2) by the High Court, the cause of action ought to have arisen, at least, in part within its territorial limits. Article 226(2) reads as under:

"226(2)- The power conferred by clause (1) to issue directions, orders or writs to any Government, authority or person may also be exercised by any High Court exercising jurisdiction in relation to the territories within which the cause of action, wholly or in part, arises for the exercise of such power, notwithstanding that the seat of such Government or authority or the residence of such person is not within those territories."

In Alchemist Ltd. case, the Hon‟ble Supreme Court examined the legal position as regards the Article 226(2) of the Constitution and observed that Article 226 as is originally enacted had twofold limitations on the jurisdiction of the High Courts with regard to their territorial jurisdiction. Firstly, the power could be exercised by the High Court throughout the territories in relation to which it exercises jurisdiction and secondly, the person or authority to whom the High Court is empowered to issue such writs, must be within those territories. The issue relating to the interpretation of these provisions came up before the Hon‟ble Supreme Court in Election Commission Vs. Saka Venkata Rao, AIR 1953 SC 210 wherein the Hon‟ble Supreme Court insisted on the presence of the person or authority within the territories in relation to which the High Court exercises jurisdiction. This view was upheld by a Constitution Bench of seven judges of the Hon‟ble Supreme Court in Lt. Col. Khajoor Singh Vs. Union of India, AIR 1961 SC 532 which probably prompted the amendment of the Constitution by which new clause (I-A) was inserted after clause (I). By the Constitution (Forty-second Amendment) Act, 1976, clause (I-A) was renumbered as clause (2) with the result that the accrual of cause of action was made an additional ground to confer jurisdiction on a High Court under Article 226 of the Constitution of India.

[11] On perusal of the decisions relied upon by the counsel appearing for the parties, it is seen that the question whether or not the cause of action wholly or in part has arisen within the territorial limits of any High Court, has to be decided in the light of the nature and character of the proceedings under Article 226 of the Constitution. Cause of action means every fact which is required to be proved by the plaintiff in order to support his right to the judgment. Whether a particular fact constitutes a cause of action or not must be decided on the basis of the facts and circumstances of each case. In order to constitute a part of cause of action, such fact ought to constitute a material, essential or integral part of cause of action. In the present case, it is not in dispute that a tender was floated vide NIT dated 03-04-2017 issued by IRCON, New Delhi for construction of 69 brides, along with approach roads, on Tamu- Kyigone- Kalewa Road in the territory of Myanmar. After the bids being opened, a letter of acceptance dated 16-10-2017 was issued in favour of the petitioner. An EPC was made on 08-11-2017 in New Delhi between the Ministry of External Affairs, Government of India, New Delhi, through its Joint Secretary and the petitioner. The right of way was handed over to the contractor on 10-11-2017 and the commencement date of the project was finalized as 28-11-2017 after submission of requisite performance bank guarantee by the contractor as per terms of the contract. The total period of construction as per the contract is 36 months from the date of commencement. A show cause notice dated 11-05-2018 was served upon the petitioner stating that the requisite steps were not taken by the petitioner to execute the work expeditiously; that there were failures to comply with the conditions and instructions and that there was no recognizable mobilization and planning to meet the contractual obligations. On 21-05-2018, the petitioner wrote a letter informing that there were some mismatching in the topographic survey done for bridge-I and also while conducting the measurements of coordinates. Being not satisfied with the reply, a notice of 15 days dated 18-06-2018 for termination of contract was issued to the petitioner as to why the authority should not proceed to terminate the contract, followed by a meeting held 25-06-2018 whereby the petitioner was required to submit a detailed three months working plan. After the expiry of three months, a cause notice dated 02-11-2018 was served on the petitioner on the allegation that the petitioner failed to comply with the notice/ reminders thereby showing no adequate progress of work and rectification of defaults. A reply dated 23-11-2018 was submitted by the petitioner which was received on 27-11-2018 and by then, the respondent had already issued a notice of 15 days dated 26-11-2018 pursuant to contractor‟s repeated failures. On 21-12-2018 a letter was addressed to the Manager, Punjab National Bank with a request to encash the bank guarantees on the ground that the petitioner has committed default in the due and faithful performance of its obligations under and in accordance with the agreement. The contract was terminated vide letter dated 24-12-2018 issued by the Joint Secretary, Ministry of External Affairs, Government of India. From the aforesaid facts, it is seen that not even a part of cause of action has arisen within the territorial limits of this court. The NIT was issued in Delhi; the agreement was signed in Delhi and the work is to be executed in Myanmar. The offices of the respondents are located in Delhi from where the letters/ notices are sent by the respondents. The mere fact that e-mail is, either sent from or received at Imphal, will not constitute a part of the cause of action because it is neither a material, essential nor an integral part of the cause of action, as has been held by the Hon‟ble Supreme Court in ONGC Vs. Utpal Kumar Basu case. In other words, there is no any fact, as contended by the counsel appearing for the petitioner, which can be said to be a material, essential or integral part constituting a part of cause of action. Considering the overall facts and circumstances of the present case, this court is of the view that the instant writ petition is not maintainable for want of jurisdiction of this court and therefore, there is no need of considering the other grounds.

[12] For the reasons stated hereinabove, the instant writ petition is dismissed as not maintainable, with no order as to costs and the interim order granted by this court stands vacated. It is open to the petitioner to approach the appropriate forum for redressal of its grievances in accordance with law.