Civil Writ Petition No.15269 of 1992 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Date of Decision: 27.5.2011 Aravali Pipes Limited ...Petitioner Vs. State of Punjab and others ...Respondents CORAM: HON'BLE MR.JUSTICE MEHINDER SINGH SULLAR Present:- Mr.Amit Jain, Advocate for the petitioner. Mr.Palwinder Singh, Senior DAG Punjab for the respondents. M ehinder S ingh S ullar , J. (Oral) The epitome of the facts, which require to be noticed for the limited purpose of deciding the core controversy, involved in the instant writ petition and emanating from the record, is that the petitioner-company Aravali Pipes Limited (for brevity “the petitioner-company”) was engaged in the manufacture of P.V.C. Pipes. It entered into a rate contract with Controller of Stores (respondent No.2) for supplying the pipes to the Public Health Department, Punjab, by virtue of rate contract agreement dated 30.4.1992 (Annexure P1). The petitioner-company was stated to have committed the criminal offences, in regard to the execution of agreement based on mis-representation, concealment of material facts and by presenting the forged documents and supplying the broken and sub-standard material. When the fraud of the petitioner-company came to the light, then, the Executive Engineer for Chief Engineer, Public Health, Punjab (respondent No.3) issued the instructions/telegram (Annexure P5) to withhold the payment, impound the unused sub-standard and broken material and to register a criminal case against it (petitioner-company) in this relevant connection. 2. The petitioner-company did not feel satisfied and preferred the present writ petition, challenging the impugned instructions/telegram (Annexure Civil Writ Petition No.15269 of 1992 2 P5), invoking the provisions of Articles 226 and 227 of the Constitution of India, inter-alia pleading that if some defects were traced in the material of petitioner- company, then, the respondents ought to have taken action for breach of terms and conditions of the agreement (Annexure P1) and they have no jurisdiction to issue the impugned instructions/telegram, for launching the criminal prosecution against it. The impugned instructions were stated to be illegal, arbitrary and against the contractual obligation. On the basis of aforesaid allegations, the petitioner- company sought to quash the impugned instructions/telegram (Annexure P5) in the manner indicated hereinabove. 3. The respondents contested the claim of the petitioner-company and respondent Nos.3 and 4 filed their joint written statement, inter-alia pleading certain preliminary objections of, maintainability of the writ petition, cause of action and locus standi of the petitioner-company. The case set up by the contesting respondents, in brief in so far as relevant, was that firstly, the petitioner- company sought the rate contract agreement by mis-representation, concealment of material facts and by presenting the forged documents and secondly it supplied the broken and sub-standard material, which was short in quantity as well and constituted the criminal offences, as depicted in Annexure R1. It was also pleaded in para 4 as under:- “That as a sequence to the discovery of fraud/cheating/mischief played by the petitioner firm it was further found out that the petitioner firm in order to seek the rate contract with the Govt. had knowingly and intentionally misrepresented/cheated the Respondent No.2 on the following accounts as well:- i) It had produced forged/tampered documents of the BIS signing by themselves, duly attested by the Assistant Executive Engineer Transmission (Purchase) HSEB Vidyut Nagar, Hissar. ii) It had got rate contract for the sizes of 90 cm and 110 mm o/d PVC pipes for which they were never given licence. iii)It had put forged ISI marking on the products i.e. 90 mm and 110 mm sizes of pipes for which they were never given licence. Civil Writ Petition No.15269 of 1992 3 iv)It had supplied the defective/sub standard material after marking the same as ISI and obtained 90% payment against R.Rs through bank. 4. In all, according to the contesting respondents that since the petitioner-company has cheated and committed the fraud constituting the cognizable offences, so, the impugned instructions (Annexure P5) were rightly issued to the concerned authority for taking legal action against it. It will not be out of place to mention here that the contesting respondents have stoutly denied all other allegations contained in the writ petition and prayed for its dismissal. 5. After hearing the learned counsel for the parties, going through the record with their valuable help and after deep consideration over the entire matter, to my mind, there is no merit in the instant writ petition. 6. Ex facie, the argument of learned counsel that even if there was any breach of contract, then action can only be taken against the petitioner-company, as per the terms and conditions of the agreement (Annexure P1) and not by issuing the impugned instructions (Annexure P5), is not only devoid of merit but misconceived as well. 7. As is evident from the record, that the petitioner-company entered into a rate contract with the Controller of Stores for supplying the PVC pipes to the Public Health Department, Punjab, by means of rate contract agreement (Annexure P1). Firstly, the petitioner-company was stated to have sought the rate contract by mis-representation, concealment of material facts and presenting the forged documents and secondly it supplied the broken and sub-standard material. When the fraud of petitioner-company came to the light, then the Executive Engineer for Chief Engineer, Public Health issued the instructions/telegram (Annexure 5) to withhold the payment, impound the unused sub-standard and broken material and to register a criminal case against it. 8. Meaning thereby, as there are direct allegations of cheating, forgery and mis-appropriation of the amount, therefore, the petitioner-company appears to have committed the cognizable offences. What cannot possibly be disputed here is Civil Writ Petition No.15269 of 1992 4 that taking action for breach of the contract (Annexure P1) is one aspect of the matter, which is of a civil nature, whereas committing forgery, fraud and mis- appropriation of the amount, constituting the cognizable criminal offences is entirely a different issue. There is no legal bar that if the petitioner -company has committed the cognizable criminal offences, then, no criminal prosecution can be launched against it in the garb of execution of the agreement (Annexure P1), which is altogether a different matter. The power of authorities to take action for violation of the terms and conditions of the agreement is distinct than the jurisdiction of criminal agency, with regard to take action for committing the cognizable criminal offences. 9. Therefore, to me, the concerned authority has rightly issued the guidelines/instructions/telegram (Annexure P5) for taking appropriate action against the petitioner-company and the contrary contentions of its learned counsel “stricto sensu” deserve to be and are hereby repelled under the present set of circumstances. 10. In the light of aforesaid reasons, as there is no merit, therefore, the instant writ petition is hereby dismissed with costs. (Mehinder Singh Sullar) 27.5.2011 Judge AS Whether to be referred to reporter? Yes/No