Serial No. 3 Suppl. List HIGH COURT OF JAMMU AND KASHMIR AT SRINAGAR LPAOW No. 168/2017 Date of Order: 10th Oct. 2017 [ENTITY] Vs. [ENTITY] & Anr. Coram: Hon'ble Mr Justice [ENTITY], Chief Justice Hon'ble Mr Justice [ENTITY], Judge Appearance: For appellant(s): Mr [ENTITY], Advocate For respondent(s): Mr [ENTITY], Advocate
i/ Whether to be reported in Yes/No Press/Media? ii/ Whether to be reported in Yes/No Digest/Journal? [ENTITY], CJ (Oral)
1. The present appeal has been preferred by the [ENTITY] against the order dated 21.04.2016 passed by a learned Single Judge of this Court in [CASE NUMBER] filed by the respondent No. 1.
2. The appellant was awarded the work of four laning of the National Highway from Qazigund to Pantha Chowk, [ENTITY] by the National Highway Authority of India. Subsequent thereto, part of the work was sub-contracted to respondent No. 1 by virtue of an allotment order dated 23.07.2014, that allotment order was accompanied by the general terms and conditions of contract. The said general terms and conditions of the contract which has been signed by both the appellant and the respondent No. 1 includes Clause 36 which clearly stipulates that:- "in case of any disputes regarding meaning and intent of any specifications, terms and conditions etc., the same shall be referred to the Managing Director of M/s [ENTITY], whose decision shall be final and binding on both the parties."
3. The appellant is aggrieved by the order dated 21.04.2016 on two grounds. The first being that the said order was passed in the absence of the appellant. The second being that the learned Single Judge ought not to have entertained the writ petition filed by the respondent No. 1 inasmuch as it arose purely out of the contractual relationship between the appellant and the respondent No. 1 which also contained an Arbitration Clause. The order that has been passed by the learned Single Judge reads as under:-
"Petitioner contends that he has been allotted construction work pursuant to allotment order dated 23.07.2014 (Annexure A1) and accordingly completed 95% of the work, but 50% of the amount already spend on the said work has not been released in favour of the petitioner, till date.
At the request of learned counsel for the petitioner, the writ petition is disposed of with a direction to respondents to consider and release the amount for the work allotted to him in pursuant to allotment order dated 23.07.2014, and also permit him to complete the work, provided there is no legal impediment and violation of terms and conditions."
4. It is evident from the above order that the learned Single Judge has directed the appellant as also the National Highway Authority of India to consider and release the amount for the work allotted to the respondent No. 1 pursuant to the allotment order dated 23.07.2014 and also to permit the respondent No. 1 to complete the work, provided there is no legal impediment and violation of the terms and conditions.
5. We are afraid that such an order could not have been passed. This is so because the writ petition itself ought not to have been entertained as the dispute arose out of a purely contractual relationship between the appellant and the respondent No. 1. The respondent No. 1 had no privity of contract with the National Highway Authority. Simply by adding the National Highway as a respondent would not give legitimacy to the writ petition. The learned Single Judge was also wrong in giving the aforesaid directions because it did so without waiting for the response on the part of the appellant. The statements made by the petitioner were taken at face value and a direction has been given for considering the release of the amount for the work allotted to the respondent. There may be several reasons why one party to a contract may withhold payment to the other party to the contract. Those reasons usually are to be found in the realm of controversy of facts. That controversy ought not to be resolved by a Court in a writ petition and particularly in the absence of the other party.
6. In [PRECEDENT], the Supreme Court, after analyzing several decisions, observed that though there is no absolute bar to the maintainability of a writ petition even in contractual matters or where there are disputed questions of fact or even when a monetary claim is raised, at the same time, discretion lies with the High Court which, under certain circumstances, it can refuse to exercise. The Supreme Court then outlined the circumstances under which the High Court, normally, would not exercise such a discretion. The said circumstances were set-forth as under:-
"69.1. The Court may not examine the issue unless the action has some public law character attached to it. 69.2. Whenever a particular mode of settlement of dispute is provided in the contract, the High Court would refuse to exercise its discretion under [SECTION] of the [ACT] and relegate the party to the said mode of settlement, particularly when settlement of disputes is to be resorted to through the means of arbitration.
69.3. If there are very serious disputed questions of fact which are of complex nature and require oral evidence for their determination.
69.4. Money claims per se particularly arising out of contractual obligations are normally not to be entertained except in exceptional circumstances."
7. In the present case, the disputes which are primarily between the appellant and the respondent No. 1, in our view, do not have any public law character attached to them. The mode of settlement of disputes has already been provided in the contract as referred to above. Furthermore, the present dispute between the appellant and the respondent No. 1 involves the determination of a money claim which arises out of contractual obligations. In any event, disputed questions of fact would definitely arise which have not even been referred to by the learned Single Judge.
8. In these circumstances, we feel that this was a fit case where the learned Single Judge ought to have exercised its discretion to refuse to entertain the writ petition. The learned Single Judge erred in entertaining the writ petition and further erred in giving directions without notice to the appellant.
9. The decision on which the learned counsel for the respondent No. 1 placed reliance upon, namely, [PRECEDENT] decided on 14.08.2015 is also of no help to the respondent.
10. Consequently, the appeal is allowed. The impugned order dated 21.04.2016 is set-aside. The parties may agitate their disputes before the appropriate forum in accordance with law. We are making it clear that we have not made any observations on the merits of the claims.
([ENTITY]) ([ENTITY]) Judge Chief Justice [ENTITY] 10th Oct. 2017 Altaf