IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE TWENTY FOURTH DAY OF JUNE TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MR JUSTICE GODA RAGHURAM WRIT PETITION NO : 17498 of 2007 Between: K. Erriswamy S/o Sri K. Ampaiah r/o Plot No.51, Ameena Abbasnagar, Venkataramana Colony Road, Kurnool. ..... PETITIONER AND 1 A.P. State Civil Supplies Corporation (A State Government Undertaking 6- 3-655/1/A, Civil Supplies Bhavan Somajiguda, Hyderabad rep by its Regional Manager, 2 A.P. State Civil Corportion District Office, Opp Biral Guest House, Kurnool, rep by its District Manager, 3 Food Corporation of India Haca Bhavan Hyderabad, rep byu its General Manager (Region), 4 The District Manager, Food Corporation of India Kurnool. .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to issue an order direction or Writ particularly one inthe nature of Writ of Mandamus or any other appropriate Writ (i) declaringthe action of the respondents in withholding the amount of Rs. 2,08,345/- from the amounts payable for the works executed by the petitioner for the period from 1-11-2000 to 31-10-2002 as illegal and arbitraryand consequently direct the respondents to elease the amount of Rs. 2,08,345/- together with interest from November 2001 and pass such further order or orders inthe circumstnaces of the case. Counsel for the Petitioner:MR.G.VIDYASAGAR Counsel for the Respondent No.: MR.B.ANJANEYULU The Court made the following: THE HON'BLE MR JUSTICE GODA RAGHURAM WRIT PETITION NO : 17498 of 2007 ORAL ORDER: At the instance of the Food Corporation of India, the AP. Civil Supplies Corporation with whom the petitioner had a handling and transporting Contract, is alleged to have withheld an amount of Rs.2,08,345-00 on the ground that the petitioner’s inefficiency in execution of the handling and transporting had occasioned transition loss of the said amount during the period 28-11-2001 to 30-11-2001 during which there was a contractual arrangement with the Civil Supplies Department and the FCI. The petitioner was transporting rice from the rakes to the Civil Supplies Godown enroute the Food Corporation of India Godowns. In defence to the writ petition, on behalf of the Civil Supplies Corporation, the District Manager has filed a counter affidavit on behalf of the respondent Nos. 1 and 2 wherein a preliminary objection is taken to the maintainability of the writ petition on the ground that the contractual arrangement between the FCI and Civil Supplies Corporation is a non-statutory contract, enforcement of the terms of which is sought in the writ petition and no relief could therefore be granted. On merits, it is contended by the answering respondent that during November, 2001 two special rakes of the Food Corporation of India rice were received at the Goods Shed, Kurnool, the destination being Civil Supplies Corporation Godowns, Kurnool. The first respondent being the storage agent for the 4th respondent made arrangement for unloading the FCI rice from railway wagons, loading into trucks, transportation to the Civil Supplies Godowns and finally stacking in the Godowns of the first respondent employing the petitioner – as the H & T Agent. The petitioner carried out these operations whereafter it was noticed that there is a transit loss quantified by the 4th respondent at 7,881-500 MTs. (0-34% of dispatched quantity) and 16.066.175 MTs. (0-69% of dispatched quantity). As a consequence, the 4th respondent depository deducted the amount of Rs.2,08,345-00 from the H & T bills payable to the petitioner as part of the amounts payable by the 4th respondent to the Civil Supplies Corporation. The answering respondent further takes the plea that Clause VI (a) of the H & T agreement between the Civil Supplies Corporation and the petitioner enjoins upon the petitioner/ contractor liability of all costs, damages, demurrages, warfages, forfeiture of wagon registration fee, charges and expenses suffered or incurred by the Corporation due to the contractor’s negligence and unworkman like performance of any service under this contract. Sri D. Linga Rao, the learned counsel appearing for the Civil Supplies Corporation urges that the provisions of Clause VI (a) aforementioned are wide and open textured to include any loss incurred by the Civil Supplies Corporation on account of the legitimate dissatisfaction of FCI consequent on the transit loss suffered by the FCI on account of the petitioner’s inefficient handling of the contract and therefore whether the petitioner’s performance was satisfactory or negligent is a disputed question of fact and not liable to be canvassed and determined under Article 226 of the Constitution of India. Whether the execution of the handling and transportation contract by the petitioner—an H & T Contractor of the Civil Supplies Corporation occasioned a loss to the FCI as a consequence of which the FCI was entitled to deduct the H & T component pro tanto the loss suffered by the FCI due to the petitioner’s performance, is a potentially disputed question of fact more appropriately determined in arbitral proceedings, if there be an arbitration clause (Sri D. Linga Rao, learned counsel contends that there is an arbitration clause) or before the Civil Court of competent jurisdiction. The public law proceedings under Article 226 of the Constitution of India is not appropriate for such determination vide Radhakrishna Agarwal v. State of Bihar1; State of Bihar v. Jain Plastics and Chemicals Ltd.,2 ; and Mazda Travels v. Govt. of India3 On the aforesaid analysis, the writ petition is dismissed granting liberty to the petitioner to pursue appropriate alternative remedies either before an Arbitrator or the Civil Court as the case may be and as advised. No costs. ____________________ GODA RAGHURAM, J dated: 24-06-2008 PVKS/* 1 AIR 1977 SC 1496 2 AIR 2002 SC 206 3 1999 (2) ALT 350