HON'BLE MR JUSTICE RAMESH RANGANATHAN WRIT PETITION No.27025 of 2011 ORDER: The relief sought for in this writ petition is to declare the action of the respondent in not considering the petitioner’s application dated 24.08.2011, (whereby they sought renewal of two years of the contract for supply of manpower), and in inviting tenders for supply of manpower with a condition of preferential treatment to the existing outsourcing staff of the Secretariat in the matter of deployment by the new agencies, as arbitrary, discriminatory, illegal and contrary to the scheme of the Contract Labour (Regulation and Abolition) Act, 1970 (for short ‘the Act’). A consequential direction is sought to the respondents to refrain from finalizing selection of the agency pursuant to the tender notification published in “Eenadu” on 15.09.2011. Facts, in brief, are that the petitioner was selected, pursuant to a tender process, to supply manpower to the respondent. An agreement was entered into in this regard on 20.09.2009. Clauses 5 to 10 of the Agreement read as under: “5. Both the parties clearly and explicitly agree that without any further action, discussion, notice and reference, this contract would automatically cease to operate with effect from 20.09.2011 and both the parties will be discharged from their respective obligations and liabilities without any formal or informal communication unless the contract is extended with mutual consent by entering into fresh agreement. 6. Both the parties agreed that this contract is purely a stand alone contract which is outside the scope of all the existing Service Rules of the employees of Government of Andhra Pradesh. 7. They shall have no direct relationship between the government and the persons sponsored by the agency and any Government Service Rules will not be applicable to them and they will not be called as government servants. 8. The employees deputed by the 2nd part agency engaged in the service on outsource basis shall not have any right or claim of seeking employment in government service by virtue of any service rendered under this agreement of contract. 9. It is agreed between both the parties that in case any candidate does not come to the work or due to some unavoidable conditions does not turn upto the work, then the 2nd part undertakes to replace such candidate. 10. It is agreed between the parties that if the 1st part wants to renew the contract, then it can be renewed on mutual consent of both the parties.” The duration of the agreement dated 20.09.2009 was for a period of two years from 19.09.2009 to 20.09.2011. A tender notice dated 15.09.2011 was published in “Eenadu” daily inviting tenders from eligible persons to supply manpower to different categories of staff. The tender schedule required tender documents to be submitted on or before 24.09.2011, and prescribed the date of opening of tenders as 27.09.2011. After the tender notification was issued on 15.09.2011, a letter was addressed by the respondent to the petitioner on 18.09.2011 informing them that the Speaker of the A.P. Legislative Assembly had extended the contract for supply of manpower for one more month with effect from 21.09.2011. This extension of one month was, evidently, granted to comply with the tender process, and for an agreement to be entered into with the outsourcing agency selected pursuant thereto. The petitioner, admittedly, did not participate in the tender process, and did not submit his bid. Even before the Writ Petition was listed before this Court on 28.09.2011, the technical bids were opened on 27.09.2011, and the schedule for opening of financial bids is fixed as 29.09.2011. Sri M.R.K. Chowdary, Learned Senior Counsel appearing for the petitioner-outsourcing agency, would submit that, while the agreement enables extension of the period of agreement for a further period of two years, it does not enable the respondent to reduce the period of extension, if granted, for a period less than two years; no complaint was received against the petitioner during the duration of the contract from 19.09.2009 to 20.09.2011; a manpower supply agreement must be treated differently from supply of machinery as it involves the livelihood of individuals; the Act disables the principal employer i.e. the respondent from engaging the services of employees of the petitioner; and the respondent ought to have favourably considered the petitioner’s request for extension of the period of agreement, instead of resorting to the tender process. Sri Ravi Shankar Jandyala, Learned Standing Counsel for the respondent, would contend that the Writ Petition is not maintainable; the petitioner, who did not even choose to participate in the tender process, has no locus standi to invoke the jurisdiction of this Court; since the last date for submission of tender has already expired on 24.09.2011, and as the technical bids have already been opened on 27.09.2011, there is no justification in now interdicting the tender process; the extension granted to the petitioner, vide letter dated 18.09.2011, was only for the limited purpose of ensuring early completion of the tender process, and continued supply of manpower till alternate arrangements are made; it is only if the existing personnel are interested in being continued would the question of their being accorded preferential treatment arise; clause 10 of the agreement provides for renewal of the contract only if the respondent wants to do so; even in case the respondent wants so to do, the contract can only be renewed on mutual consent of both the parties; and the agreement does not entitle the petitioner to claim, as a matter of right, that the contract should, automatically, be renewed for a second term of two years. Employees of the petitioner would continue to remain their employees notwithstanding utilization of the services of such persons by the respondent. On termination/expiry of the contract between the petitioner and the respondent, these personnel are no longer required to work in the establishment of the respondent. They would remain the employees of the petitioner as long as the contract of employment remains in force. It is only if they cease to be the employees of the petitioner can any other outsourcing agency engage their services for discharging duties in different establishments of the respondent. Termination/expiry of the contract between the petitioner and the respondent does not confer either on the petitioner, or on persons employed by them, any right to claim regularization of the services of such persons under the respondent. The Constitution Bench of the Supreme Court, in Steel Authority of India Ltd. v. National Union Water Front Workers[1], held that abolition of the contract labour system, under Section 10(1) of the Act, would not result in automatic absorption of contract labour in the establishment of the principal employer in which they were working at that time; neither Section 10 of the Act nor any other provision in the Act, either expressly or by necessary implication, provided for automatic absorption of contract labour on issuing a notification by the appropriate Government under sub-section (1) of Section 10, prohibiting employment of contract labour in any establishment and, consequently, the principal employer could not be required to absorb the contract labour working in the concerned establishment. Reliance placed by the Learned Senior Counsel on the provisions of the Act, therefore, is misplaced. On the question of maintainability of a writ petition involving contractual disputes, a distinction must be made between statutory and non-statutory contracts. A contract would not become statutory simply because it has been awarded by a statutory body. Merely because the obligations imposed by the contract, on the contracting parties, come within the purview of the Contract Act, would also not make the contract statutory. A statute may expressly or impliedly confer power on a statutory body to enter into contracts in order to enable it to discharge its functions. The fact that one of the parties to the agreement is a statutory or a public body will not, by itself, affect the principles to be applied for every act of a statutory body need not, necessarily, involve an exercise of statutory power. Statutory bodies, like private parties, have the power to contract or deal with property. Such activities may not raise any issue of public law. (Kerala State Electricity Board v. Kurien E.Kalathil[2]). It is only if entering into a contract, containing the prescribed terms and conditions, is a must under the statute would the contract be statutory in character. A contract may contain terms and conditions which may not be statutory and which have been incorporated therein as a result of mutual agreement between the parties. Such agreements are not statutory contracts. (India Thermal Power Ltd. v. State of M.P.[3]). A writ of mandamus may be granted only in a case where there is a statutory duty imposed, and there is failure to discharge that statutory obligation. Any duty or obligation arising out of a contract cannot, ordinarily, be enforced by the machinery of a writ under Article 226 of the Constitution. (Lekhraj v. Deputy Custodian[4]). A right claimed in terms of a contract cannot be enforced in a writ petition. (Banchhanidhi v. State of Orissa[5]). A writ petition is not an appropriate remedy for impeaching contractual obligations. (Har Shankar v. Dy. E. & T. Commissioner[6]). It is the contract and not the executive power, regulated by the Constitution, which governs relations of the parties. (Radhakrishna Agarwal v. State of Bihar[7]). Ordinarily, where a breach of contract is complained of, a party complaining of such breach may sue for specific performance of the contract, or for damages. Such a suit would ordinarily be cognizable by the Civil Court and the High Court, in its extraordinary jurisdiction, would not entertain such a petition. (Divisional Forest Officer v. Bishwanath Tea Co. Ltd.[8]). Where the contract, entered into between the State and the person aggrieved, is non-statutory and the rights are governed only by the terms of the contract, no writ or order can be issued under Article 226 of the Constitution so as to compel the authority to remedy the breach of contract and the High Court, in such cases, would not, ordinarily, examine the question of arbitrariness and unreasonableness on the part of the State or its instrumentalities. (Bareilly Development Authority v. Ajai Pal Singh[9]). If the matter is governed by a contract a writ petition would, ordinarily, not lie since it is a public law remedy and is not available in the private law field. (State of Gujarat v. M. P. Shah Charitable Trust[10]). There is no room for invoking the doctrine of unjust enrichment in business transactions. The rule of promissory estoppel and estoppel by conduct cannot be invoked to alter or amend the specific terms of the contract. The rule of legitimate expectation cannot be invoked to modify or vary the express terms of the contract. In case of contracts freely entered into with the State, there is no room for invoking the doctrine of fairness and reasonableness against one party to the contract (State), for the purpose of altering or adding to the terms and conditions of the contract and, in such cases, the mutual rights and liabilities of the parties are governed by the terms of the contract and the laws relating to contracts. The contract between the parties is a contract in the realm of private law. Any dispute, relating to interpretation of the terms and conditions of such a contract, cannot be agitated in a writ petition, and it is a matter either for arbitration as provided by the contract, or for the Civil Court as the case may be. (Asstt. Excise Commissioner v. Issac Peter[11]; State of U. P. v. Bridge and Roof Co. , (India) Ltd.[12]). The interpretation and implementation of a clause in a contract cannot be the subject-matter of a writ petition. If a term of a contract is violated, ordinarily, the remedy is not a writ petition under Article 226. Disputes relating to interpretation of the terms and conditions of a non-statutory contract cannot, ordinarily, be agitated in a petition under Article 226 of the Constitution of India and it is a matter for adjudication by a Civil Court or in arbitration if provided for in the contract. (Kerala State Electricity board2). Disputed questions or rival claims of parties, with regard to breach of contract, is to be investigated and determined on the basis of evidence which may be led by the parties in a properly instituted civil suit rather than by a Court exercising the prerogative of issuing writs. (State of Bihar v. Jain Plastics and Chemicals Ltd.,[13]). Disputes relating to contracts cannot, ordinarily, be agitated under Article 226 of the Constitution of India. (Pimri Chinchwad Municipal Corpn. v. Gayatri Constructions Co.[14]; National Highways Authority of India v. Ganga Enterprises[15]). While entertaining an objection as to the maintainability of a writ petition under Article 226 of the Constitution of India the High Court, having regard to the facts of the case, has the discretion to entertain or not to entertain a writ petition. This plenary right of the High Court to issue a prerogative writ will not, normally, be exercised by the Court to the exclusion of other available remedies. The scope of judicial review in respect of disputes falling within the domain of contractual obligations is limited and, in doubtful cases, the parties may be relegated to adjudication of their rights by resort to the remedies provided for adjudication of purely contractual disputes. (ABL International Ltd. v. Export Credit Guarantee corporation of India Limited[16]). A perusal of the various clauses of the agreement, to which attention has been drawn by Counsel on either side, would show that the contract ceased to operate from 20.09.2011, and both parties were discharged from their respective obligations and liabilities thereafter unless the contract was extended with mutual consent by entering into a fresh agreement; and, it is only if the respondent herein wishes to renew the contract, can the contract be renewed by the mutual consent of both the parties to the agreement. The contract provides for primacy being given to the wishes of the respondent, and not the petitioner herein. It is only if the respondent so desires and, thereafter, both parties mutually agree, can the contract be renewed. The parties to the agreement are bound by the terms and conditions thereof, and cannot resile therefrom. It is not open to the petitioner, who entered into the agreement with their eyes wide open, to now contend that they are entitled for automatic renewal/extension of the contract by another two years. Even if any other construction of the terms and conditions of the contract is possible, the case of the petitioner is of breach of the contract by the respondent. For breach of contractual obligation, or for enforcement of the terms and conditions of the contract, the remedy is, ordinarily, by way of a civil suit before the Civil Court of competent jurisdiction. It is not in dispute that the contract in question is not referable to any statutory provision or rule. The petitioner, in short, alleges violation of the terms and conditions of a non-statutory contract and seeks its enforcement. This Court would, ordinarily, not adjudicate disputes arising from non-statutory contracts. I see no reason to exercise discretion to entertain a Writ Petition seeking enforcement of contractual obligations since these matters are better adjudicated in civil proceedings before a Civil Court of competent jurisdiction. In case the petitioner avails the remedy of a civil suit, the dispute shall be adjudicated by the competent Civil Court in accordance with law, uninfluenced by any observations made in this order. Leaving it open to the petitioner, if they so choose, to avail the alternative remedies available to them in law including, if need be, by way of a civil suit before a Civil Court of competent jurisdiction, the Writ Petition is dismissed. However, in the circumstances, without costs. ___________________________ RAMESH RANGANATHAN, J DATE:30.09.2011 usd/mrkr/asp [1] AIR 2001 SC 3527 [2] 2000 (6) SCC 293 [3] 2000(3) ALD 109 (SC) [4] AIR 1966 SC 334 [5] AIR 1972 SC 843 [6] AIR 1975 SC 1121 [7] (1977) 3 SCC 457 [8] 1981(3) SCC 238 [9] (1989) 2 SCC 116 [10] (1994) 3 SCC 552 [11] (1994) 4 SCC 104 [12] (1996) 6 SCC 22 [13] 2001 (8) Supreme 334 = AIR 2002 SC 206 [14] 2008(8) SCC 172 [15] (2003) 7 SCC 410 [16] (2004) 3 SCC 553