IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) MONDAY, THE SEVENTH DAY OF MARCH TWO THOUSAND AND FIVE PRESENT THE HON'BLE SRI JUSTICE M.H.S. ANSARI AND THE HON'BLE SRI JUSTICE T.Ch.SURYA RAO WRIT PETITION No.25325 of 2004 Between: M/s K.Odaiah and sons, Registered Partnership Firm with Regd No.6054, H.No.19-7-217, Swatantra Chowk, Godavarikani, Karimnagar District, rep. by its Managing Partner, Sri K.Shankaraiah. ..... PETITIONER AND 1 Singareni Collieries Company Limited, Lakdikapool, Hyderabad, rep. by its Chairman and Managing Director. 2 The Director (Finance), Singareni Collieries Company Limited, Kothagudem, Karimnagar District. 3 The General Manager (Civil), Singareni Collieries Company Limited,Kothagudem, Karimnagar District. 4 The General Manager, Singareni Collieries Company Limited, Shivarampur Area, Adilabad District. .....RESPONDENTS Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed herein the High Court may be pleased to issue a writ or order or direction, more particularly one in the nature of Writ of Mandamus declaring the action of the respondents in deducting the Income Tax as well as Sales Tax on the variation amounts i.e., the difference between the estimated rate and the procurement rate from the local market, from the bills of the Petitioner Firm as arbitrary, unfair, unjust and violative of Articles 14 and 19(1)(g) of the Constitution of India apart from contrary to the agreed terms mentioned in the Application with Schedule of approximate quantity of works and consequently direct the respondents to refund the Income Tax and Sales Tax deducted from the Petitioner Firm till date, in the interest of justice. Counsel for the Petitioner: Mr. P.KESAVA RAO Counsel for the Respondents: Mr.NANDIGAM KRISHNA RAO The Court at the admission stage made the following : ORDER: (per Sri Justice M.H.S.Ansari) Pursuant to the notice before admission, respondent Company is represented before the Court by its learned counsel and has also filed its counter affidavit. A reply has also been filed. An objection at the threshold has been taken as to the maintainability of the instant writ petition on the ground that there has been no violation of any rule or regulation having any statutory force. The matter is contractual and it was, therefore, contended on behalf of the respondents that interference by this Court in exercise of its extraordinary jurisdiction is not warranted, the writ petition as filed is not maintainable and is to be dismissed in limine. The foremost question, therefore, that arises for consideration is whether this Court should exercise its discretion to entertain the writ petition. Arguments have been addressed only on this aspect of the matter and accordingly this judgment is confined solely to that aspect. Learned counsel for the petitioner has relied upon the judgments of the Supreme Court in ABL International Ltd. v. Export Credit Guarantee Corpn. of India Ltd. and Gujarat State Financial Corpn. v. Lotus Hotels. For consideration of the question as posed above, a few facts need to be noticed. The petitioner is a registered partnership firm and was awarded the contract by the respondent company in respect of the works for stone stowing arrangement. An agreement was executed between the parties. Under the agreement, company has reserved to itself the right to supply cement and structural steel. If the same is not available in the company stores, the contractor is allowed to procure the same from outside local market and “price variation” will be allowed to the contractor. The contention of the petitioner is that quoting of 18% above estimated rate is not applicable to the “price variation”. Secondly, it is contended that the company shall pay the “price variation” amount without any deduction of income tax and sales tax to the petitioner. The relief claimed in the writ petition is for declaring the action of the respondent company in deducting the income tax as well as sales tax on price variation i.e., difference between the estimated rate and the procurement rate from the bills of the petitioner as arbitrary and for a consequential direction to refund the income tax and sales tax deducted from the petitioner. Reliance has been placed on clauses 4 and 5 of the contract. The contract in question is a works contract and is non-statutory. In other words, the question is whether the matter arising under non-statutory contract even though it is assumed for the purpose of this enquiry that the contracting party (respondent No.1) is an instrumentality/agency of the State within the meaning of Article 12 of the Constitution of India, can the relief as prayed for be granted by this Court in exercise of its jurisdiction under Article 226 of the Constitution. After having heard the learned counsel for the respective parties, we are of the view that the matter is squarely covered by the judgment of the Supreme Court in State of U.P. v. Bridge & Roof Co. (India) Ltd.. It was held in that case that the remedy adopted was misconceived and no relief could be granted in writ proceedings. Suffice here to extract the relevant passage from that judgment which reads as under. “……..the contract between the parties is a contract in the realm private law. It is not a statutory contract. It is governed by the provisions of the Contract Act or, may be, also by certain provisions of the Sale of Goods Act. Any dispute relating to interpretation of the terms and conditions of such a contract cannot be agitated, and could not have been agitated, in a writ petition. That is a matter either for arbitration as provided by the contract or for the civil court, as the case may be. Whether any amount is due to the respondent from the appellant-Government under the contract and, if so, how much and the further question whether retention or refusal to pay any amount by the Government is justified or not, are all matters which cannot be agitated in or adjudicated upon in a writ petition. The prayer in the writ petition, viz., to restrain the Government from deducting a particular amount from the writ petitioner’s bill(s) was not a prayer which could be granted by the High Court under Article 226……….” Adverting now to the judgments relied upon by the learned counsel for the petitioner. In ABL International Ltd. (supra), after review of the various judgments of the apex Court, certain legal principles as to the maintainability of the writ petition were stated. In paragraph 27 of the judgment, the observations are to the following effect. “From the above discussion of ours, the following legal principles emerge as to the maintainability of a writ petition: a. In an appropriate case, a writ petition as against a State or an instrumentality of a State arising out of a contractual obligation is maintainable. b. Merely because some disputed questions of fact arise for consideration, same cannot be a ground to refuse to entertain a writ petition in all cases as a matter of rule. c. A writ petition involving a consequential relief of monetary claim is also maintainable.” It was thus held that in an appropriate case, a writ petition as against the State or against instrumentality of a State arising out of a contractual obligation is maintainable. The question is whether the present case is an appropriate case. We think not. This is for the reason that the matter is squarely covered by the judgment of the Supreme Court in Bridge & Roof Co. case (supra) where the remedy of writ petition claiming similar reliefs as in the case on hand, was held to be misconceived. Lotus Hotels case (supra) turned upon the principles of promissory estoppel and also viewed from the angle of the instrumentality of the Government to act fairly. In that case, the Court found that the loan had been sanctioned. Based thereon, the respondent in that case acted upon that promise. Thus, it was held that the principles of promissory estoppel, would estop the Corporation from backing out of its obligation. The following observations from that judgment make the position clear. “Now if appellant entered into a solemn contract in discharge and performance of its statutory duty and the respondent acted upon it, the statutory corporation cannot be allowed to act arbitrarily so as to cause harm and injury, flowing from its unreasonable conduct, to the respondent. In such a situation, the court is not powerless from holding the appellant to its promise and it can be enforced by a writ of mandamus directing it to perform its statutory duty. A petition under Article 226 of the Constitution would certainly lie to direct performance of a statutory duty by ‘other authority’ as envisaged by Article 12.” (emphasis supplied) The above case is thus distinguishable with the facts of the case on hand and is of no assistance to the petitioner. For the reasons afore-stated, we are not inclined to exercise the discretion to entertain the writ petition as the petitioner has efficacious alternative remedy. The writ petition is accordingly dismissed at admission stage. Liberty, however, to the petitioner to avail of such remedies as may be available to it at law and as it may be advised. It need only be clarified that if the petitioner avails of any such remedy, the statements or observations made in this judgment shall not prejudicially affect either party to those proceedings which shall be heard and disposed of upon their own merits uninfluenced in any manner by any statement or observation contained in this judgment and order. In the result, with liberty as afore-stated, the writ petition is dismissed. No order as to costs. _______________________ (M.H.S.ANSARI, J.) 7th March 2005. _______________________ (T.Ch.SURYA RAO, J.) ARS To 1. The Chairman and Managing Director, Singareni Collieries Company Limited, Lakdikapool, Hyderabad. 2.The Director (Finance), Singareni Collieries Company Limited, Kothagudem, Karimnagar District. 3.The General Manager (Civil), Singareni Collieries Company Limited, Kothagudem, Karimnagar District. 4.The General Manager, Singareni Collieries Company Limited, Shivarampur Area, Adilabad District. 5.Two CD copies.