103 of 1958
Petition under article 32 of the Constitution for enforcement of fundamental rights
M T Paikeday and Ganpat Rai for the petitioner
Sardar Bahadur for respondent No 1
M R Krishna Pillai for respondent No 3 788 1958
December 11
The Judgment of the Court was delivered by HIDAYATULLAH J
This is a petition under article 32 of the Constitution by one C K Achuthan who claims to have held a contract for the supply of milk and other articles of diet for the year 1958 1959 but whose contract for supply of milk is said to have been cancelled by the District Medical Officer second respondent herein
The contract for the
supply of milk has now been given to the third respondent the Co operative Milk Supplies Society Cannanore
From the petition it appears that the petitioner held contracts for the supply of milk to the Government Hospital at Cannanore Kerala State ever since 1946 and that previous to this his brother in the same business held similar contracts from 1936
In 1957 a  uniform procedure for fixing up contracts  was adopted and by a notification conditions for acceptance of tender were laid down
The petitioner as well as the third respondent submitted their respective tenders which were to be opened by the Superintendent of the Hospital in the presence of interested parties
We need not refer to all the conditions under which tenders were to be accepted except those which have a bearing upon this matter
It was stated in the conditions that no tender marked at  current market rates  would be accepted and further that in the supply of milk preference would be given to approved Co operative Milk Supply Unions and Societies if their tender was within a margin of 5 per cent
over the market rate or the lowest tendered rate whichever was less
All persons making tender for the contract had to produce a certificate of solvency and tax clearance certificates and to make a deposit with the tender
On January 20 1958 the tenders which were submitted were scrutinised and the tender of the petitioner for the supply of milk was accepted and that of the third respondent rejected
It appears that the Superintendent respondent No 2 communicated to the Director of Public Health her reasons for accepting the tender of the petitioner and not accepting that 789 of the third respondent
Certain correspondence then ensued between the Director of Health Services and the second respondent as a result of which the petitioner was informed that the contract for the supply of milk given to him was cancelled
He was informed that it was the policy of Government that in the matter of supply to Government medical institutions in Cannanore District the Co operative Milk Supplies Union was to be given contracts on the basis of prices fixed by the Revenue Department
It appears that some more correspondence between the Director of Health Services and the second respondent ensued and it was pointed out to the second respondent that action should have been taken under Cl 20 of the conditions of the tender and the contract only cancelled after giving a month s notice to the petitioner
In furtherance of these instructions the second respondent issued a notice in terms of Cl 20 of the tender and cancelled the contract after the notice period
The present petition has been filed to question the several orders referred to above
It may be pointed out that previous to this the petitioner had applied under article 226 of the Constitution to the High Court of Kerala but his petition O P No 201 of 1958 was rejected by Raman Nayar J on June 6 1958
A Letters Patent Appeal was also dismissed by Koshi C J and Vaidialingam J A section No 354 of 1958 decided on July 7 1958
The High Court held that the present matter was no more than a breach if any of the contract by the State Government and that the appropriate remedy was to file a civil suit and not to proceed under article 226
It appears that no special leave to appeal was sought from this Court against the above orders and the matter has been brought for adjudication not by way of appeal but directly under article 32 of the Constitution as an infringement of the fundamental right of the petitioner
The contention of the petitioner in this behalf is that he is entitled to an equal treatment in the eye of law and that there has been discrimination against him vis a vis the third respondent
He claims protection under articles 14 161 191g and 790 31 of the Constitution
In our opinion none of these Articles can be made applicable to the facts of the present case
No doubt the petitioner claims to have succeeded in obtaining the contract from the Government and the third respondent failed to do so
But even if he held the contract the petitioner did not acquire an absolute right to be continued in that contract because power was reserved by the Government under Cl 20 to terminate the contract after giving a month s notice
Whether the exercise of that power in the present case was regular or legal is not a matter on which we are called upon to pronounce because adjudication of such dispute can appropriately take place only before the ordinary Civil Courts where evidence can be gone into and examined at length
The gist of the present matter is the breach if any of the contract said to have been given to the petitioner which has been cancelled either for good or for bad reasons
There is no discrimination because it is perfectly open to the Government even as it is to a private party to choose a person to their liking to fulfill contracts which they wish to be performed
When one person is chosen rather than another the aggrieved party cannot claim the protection of article 14 because the choice of the person to fulfill a particular contract must be left to the Government
Similarly a contract which is held from Government stands on no different footing from a contract held from a private party
The breach of the contract if any may entitle the person aggrieved to sue for damages or in appropriate cases even specific performance but he cannot complain that there has been a deprivation of the right to practise any profession or to carry on any occupation trade or business such as is contemplated by article 191g
Nor has it been shown how article 31 of the Constitution may be invoked to prevent cancellation of a contract in exercise of powers conferred by one of the terms of the contract itself
The main contention of the petitioner before us was thus under article 161 of the Constitution and he claimed equal opportunity of employment under the 791 State
To begin with a contract for the supply of goods is not a contract of employment in the sense in which that word has been used in the Article
The petitioner wag not to be employed as a servant to fetch milk on behalf of the institution but was a contractor for supplying the articles on payment of price
He claimed to have been given a contract for supply of milk and did not claim to be an employee of the State
Article 161 of the Constitution  both in its terms and in the collocation of the words indicates that it is confined to  employment  by the State and has reference to employment in service rather than as contractors
Of course there may be cases in which the contract may include within itself an element of service
In the present case however such a consideration does not arise and it is therefore not necessary for us to examine whether those cases are covered by the said Article
But it is clear that every person whose offer to perform a contract of supply is refused or whose contract for such supply is breached cannot be said to have been denied equal opportunity of employment and it is to this matter that this case is confined
Looking to the facts of the case it is manifest that the petitioner was supplying or in other words selling milk and other articles of diet to the State for the use of hospitals and similar institutions
He was in no sense a servant and no question of employment qua servant arose
In these circumstances it is plain that article 161 of the Constitution is not attracted to the facts
In our opinion the petition under article 32 of the Constitution is wholly misconceived
No fundamental right is involved
At best it is a right to take the matter to the Civil Court if so advised and to claim damages for breach of contract if any
The petition accordingly fails and is dismissed with costs
Petition dismissed


Summary:
Nawab Salar Jung III expired on March 2 1949 leaving behind him no issue but a vast estate
Several persons came forward to be his heirs
One of the claimants Sajjid Yar Jung did not have the wherewithal to establish his claim to a share in the estate
He approached the plaintiff for financial help
An agreement was executed between them according to which Sajjid Yar Jung agreed to return all amounts to be advanced by the plaintiff and in addition to give him one anna share in the amount that would be received by Sajjid Yar Jung from the estate
Sajjid Yar Jung borrowed a total sum of Rs 75000 under the agreement
The dispute was ultimately settled in the Civil Court by compromise between the various claimants
According to the plaintiff the amount due to Sajjid Yar Jung was about Rs60 Lakhs and hence the plaintiff claimed Rs3 lakh as one anna share in addition to the sum advanced ie Rs75000
The plaintiff filed the present suit for the recovery of the total amount
The City Civil Court inter alia found that the agreement was opposed to public policy as the object of the agreement was that the plaintiff should wield his influence with Central and State Ministers to have the Nawab recognised as the heir to the estate in return for his being given one anna share in the amount to be received by the Nawab
The Court therefore held that the agreement in question was not enforceable and even the amounts actually advanced could not be recovered by the plaintiff
In the appeal the Division Bench of the High Court held that the agreement was one whole agreement and hence the plaintiff was not entitled to recover even the amount of Rs75000 which was actually advanced
The Division Bench also held that the agreement was public policy
328 This Court granted special leave only in respect of the said amount of Rs75000
Before this Court it was contended on behalf of the plaintiff that i the amount of Rs75000 could be separated from the other agreement or could be treated differently ii if the champertous nature of the agreement was ignored which it was legitimate to do so in this country there was no other ground of public policy on which the agreement could be struck down iii assuming that the agreement was a champertous one it was neither immoral nor against public policy and even de hors the agreement the appellant was entitled to the said advance of Rs75000 under section 70 of the Indian Contract Act
It was further urged that both the City Civil Court as well as the High Court had created a new head of public policy to declare the agreement as void although according to the relevant statutory provisions as well as the decisions of the court the agreement was not void
Dismissing the appeal this Court HELD Per Sawant J 1 It is apparent on the face of the record that the advance and the share in the estate were parts of the same contract one as a consideration for the other
The two stand together and none can stand without the other
333F 2 A contract which has a tendency to injure public interests or public welfare is one against public policy
337D 3 What constitutes an injury to public interests or welfare would depend upon the times and climes
The social milieu in which the contract is sought to be enforced would decide the factum the nature and the degree of the injury
It is contrary to the concept of pubic policy to contend that it is immutable since it must vary with the varying needs of the society
What those needs are would depend upon the consensus value judgments of the enlightened section of the society
These values may sometimes get incorporated in the legislation but sometimes they may not
337E 4 The legislature often fails to keep pace with the changing needs and values nor is it realistic to expect that it will have provided for all contingencies and eventualities
337E F 329 5 It is not only necessary but obligatory on the courts to step in to fill the lacluna
When courts perform this function undoubtedly they legislate judicially
But that is a kind of legislation which stands implicitly delegated to them to further the object of the legislation and to promote the goals of the society
337F 6 So long as the courts keep themselves tethered to the ethos of the society and do not travel off its course so long as they attempt to furnish the felt necessities of the time and do not refurbish them
their role in this respect has to be welcomed
337G Ghurelal Parakh vs Mahadeodas Maiya  Ors 1959 Suppl
2 SCR 406 Richardson vs Mellish   In re Mirams  referred to
7 All courts are at one time or the other felt the need to bridge the gap between what is and what is intended to be
The courts cannot in such circumstances shirk from their duty and refuse to fill the gap
In performing this duty they do not foist upon the society their value judgments
They respect and accept the prevailling values and do what is expected of them
338D 8 The courts will fail in their duty if they do not rise to the occasion but approve helplessly of an interpretation of a statute or a document or an action of an individual which is certain to subvert the societal goals and endanger the public good
338E 9 The contract in the present case had been entered into with the obvious purpose of influencing the authorities to procure a verdict in favour of the late Nawab and was obviously a carrier contract
To enforce such a contract although its tendencies to injure public weal are manifest is not only to abdicate one s public duty but to assist in the promotion of a pernicious practice of procuring decisions by influencing authorities when they should abide by the law
To strike down such contracts is not to invent a new head of public policy but to give effect to its true implications
338F G In the matter of Mr G  a Senior Advocate of the Supreme Court  referred to
10 A democratic society is founded on the rule of law and any practice which seeks to subvert or circumvent the law at its very root
When the Court discountenances such practice it only safeguards 330 the foundation of the society
Even assuming that the Court finds a new head of public policy to strike down such practice its activism is not only warranted but desired
338G H Per Fathima Beevi J 1 There is no doubt that the contract relating to the payment of the amount is not severable from the agreement to promote the cause of Sajjid Yar Jung by wielding the influence the plaintiff had
339G 2 Every agreement of which the object or consideration is unlawful is void
The consideration or object of an agreement is unlawful when the court regards it as opposed to public policy
339G 3 Public Policy is a principle of judicial interpretation founded on the current needs of the community
The law relating to public policy cannot remain immutable
It must change with passage of time
339H 340A 4 A bargain whereby one party is to assist another in recovering property and is to share in the proceeds of the action and such assistance is by using the influence with the administration irrespective of the fact that the persons intended to be influenced are not amenable to such influence is against protection and promotion of public welfare
It is opposed to public policy
340B