Case: UTTAR PRADESH POWER TRANSMISSION CORPORATION LTD. AND ANR Vs. CG POWER AND INDUSTRIAL SOLUTIONS LIMITED AND ANR

19. The Respondent No.1, M/s CG Power and Industrial Solutions Limited (formerly known as M/S Crompton Greaves Limited) entered into a Framework Agreement with UPPTCL for construction of 765/400 KV Substations, at Unnao, Uttar Pradesh.20. By a letter No. 130/ESD-765/2/CGL dated 5th March 2010, the Superintending Engineer, UPPTCL, Unnao placed a detailed order on the Respondent No.1 for construction of 765/400 kV Substation at Unnao on single source responsibility turn-key basis. The scope of the work as stated in the said letter was as follows:-1.1 The scope of this contract, hereinafter called FIRST CONTRACT, covers all works related to design, engineering, manufacturing, testing at works, supply of all required equipment and material with accessories and auxiliaries, as detailed in Schedule of Quantities & Prices (Annexure-IV) to sub-station site. The scope shall also include supply of any other item necessary for completing the scope of work without any extra cost, if not specified in above Schedule.1.2 The SECOND CONTRACT shall cover unloading, handling at site, erection, testing and commissioning of all the equipment and material to be supplied by the contractor under first contract and any other work require to complete the scope for commissioning and handing over the entire sub-station.1.3 the THIRD CONTRACT shall cover all civil works including material to complete the scope for commissioning and hading over of the entire substation.1.4 The proposed sub-station shall be constructed as per scope of work (Doc. No.017806-47ES-0100) under the technical specification (Volume-II) and the specification drawings enclosed with the REP document.1.5 The proposed sub-station will be comprised of following works: 1.5.1 765kV switchyard (one & a half breaker scheme)a) Two (2), 765kV feeder bays along-with 1x330MVAR shunt reactor in each bayb) Two (2), 765kV bays for 2x1000MVA Tranformer Bankc) One (1), 765kV bay for 189MVAR Bus Reactor Bankd) 3 nos. spare 765kV bays1.5.2 400kV switchyard is to be modified to accommodate Two (2), 400kV bays of 2x1000MVA, 765/400kV Transformer Bank in Double Main & Transformer Bus arrangement.1.5.3 Electrical / Mechanical Auxiliaries & other Major Misc. worksa) 2x1000kVA, 33/0/4kV Transformersb) D.G Set c) Air conditioning Plant for each buildingd) Lighting system for complete switchyard, buildings, streets and stores etc.e) SDH communication system & PLCC communicationf) AC & DC Auxiliary Power supply system including Batteries, Battery charges, AC & DC distribution boardsg) Fire Fighting equipmenth) Any other work necessary for completion of sub-stationSub-para 5 of the said letter under the sub-heading Nature of Contract clearly provided that the work for the 765kV sub-stations on single source responsibility, turn-key basis shall be awarded through following four separate contracts:-FIRST CONTRACT Supply and Delivery of Equipment & MaterialSECOND CONTRACT Handling, Erection, Testing and Commissioning WorksTHIRD CONTACT Civil WorksFOURTH CONTRACT Three years O & M21. In terms of the said Framework Agreement, the work was split, and covered by four separate contracts. The first contract was for design, engineering, manufacture, testing at works and supply of all required equipment and materials with accessories and auxiliaries, as detailed in the said contract; the second contract covered erection, testing and commissioning at site including unloading, handling etc.; the third contract covered all civil works including materials for commissioning and handing over of the Substations and the fourth contract covered operations and maintenance for three years.22. In sub-clause 5 of the said Frame Work Agreement, under the head Nature of Contract, it was clearly stated that the first and second contract shall cover all works other than civil works required to be completed. The first contract covered supply and delivery of all equipment and materials as per schedule of prices as contained in the concerned contract and any other item required to complete the scope of work for completion of sub-station including their performance and guarantees; the second contract covered unloading, handling at site, erection, testing and commissioning of all the equipment and material supplied by the contractor under the first contract and any other work required to complete the scope for commissioning and handing over of the entire sub-station. The third contract would cover all civil works including required materials under its scope.23. Four separate contracts were executed by and between UPPTCL and the Respondent No.1. There can be no doubt that cess under the Cess Act is payable in respect of the Third Contract, which covers all civil works. The first and second contracts, which cover all works other than civil works, and do not involve any construction, do not attract cess under the Cess Act.24. The penultimate paragraph of Clause 5 of the said Frame Work Agreement provided:-Nature of ContractThe Contractor shall be fully responsible for the works to be executed under first three (3) Contracts and any breach or occurrence or default under one Contract shall automatically be deemed as a breach or occurrence or default of other Contracts, giving the Engineer absolute right to take appropriate action under any/all the Contracts including right to recover damages from any/all the Contracts or terminate any/all the Contracts. Any such breach or default or occurrence in any of the Contracts shall not relieve the Contractor of any of his responsibility/obligation under the other Contracts and no time extension shall be given to the Contractor on these grounds. The equipment/material to be supplied by the Contractor under the first Contract when installed and commissioned under the second Contract shall give satisfactory performance in accordance with provisions of the Contract. The signing of three (3) separate Contracts shall in no way dilute the insurance responsibility and obligations of the Contractor.25. The total value of (i) the First Contract (Supply) was 2750933042.00 (Two Hundred and Seventy Five Crores Nine Lakhs, Thirty Three Thousand and Forty Two), (ii) the Second Contract (Erection) was Rs.40129510.00 (Four Crores One Lakh, Twenty Nine Thousand Five Hundred and Ten), (iii) the Third contract (Civil) was Rs. 193808465.00 (Nineteen Crores Thirty Eight Lakhs Eight Thousand Four Hundred and Sixty Five) and (iv) the Fourth contract (Operations and Maintenance) was Rs.35737200.00 (Three Crores, Fifty Seven Lakhs Thirty Seven Thousand and Two Hundred).26. In this context, it would be appropriate to refer to Clause 6 of the letter dated 5th March 2010, extracted hereinbelow:-6. Aggregate Contract ValueThe sum of Contract values of first, second, third and fourth Contracts for 765/400kV sub-station at Unnao shall be the aggregate Contract value. The aggregate value of each contract shall be as under:-i. Total value of First Contract (Supply of Equipment & Material) Rs.275,09,33,042.00ii. Total value of Second Contract (Handling, Erection, testing & commissioning Works) Rs.4,01,29,510.00iii. Total Value of Third contract (Civil Works) Rs.19,38,08,465.00iv. Total value of Fourth Contract (Three Years O & M) Rs.3,57,37,200.00Aggregate Value of Contract Rs.302,06,08,217.00(Rupees three hundred two crore six lac eight thousand two hundred seventeen only)27. Clause 13 provided that the contract would be governed by the conditions given in the said letter read with:(a) Special Conditions of Contract (Annexure-II)(b) General Conditions for supply of Plant & the Execution of work Form-A (Annexure-III),(c) (i) Technical specification as per volume II, III & IV,(d) Technical Data Schedule (Guarantee technical particulars, as per volume -V).28. Clause 1 of the Special Conditions of Contract relating to Scope of Work provided:-The scope of work is defined in the technical specification No.017806- 47ES-0100 and comprises engineering, procurement and construction of 765/400 kV sub-station at Unnao on a turn-key basis.The substation includes four (4) separate Contracts which are defined in Clause 3.1 of the Special Conditions of Contract.29. Clause 3 of the Special Conditions of Contract relating toNature of ContractSCC 3.1 The work for the above 765kV sub-stations on single source responsibility, turn-key basis shall be awarded through following four separate contracts:-FIRST CONTRACT Supply and Delivery of Equipment & MaterialSECOND CONTRACT Handling, Erection, Testing and Commissioning WorksTHIRD CONTACT Civil WorksFOURTH CONTRACT Three years O & MThe first and second Contracts shall cover all works, other than civil works, required to complete total scope under these specifications. The THIRD Contact shall cover all civil works including required materials under its scope.The first Contract shall cover supply and delivery of all equipments and materials as per Schedule of Prices of respective Contract and any other item required to complete the scope of work for completion of substation including their performance and guarantees.The second Contract shall cover unloading, handling at site, erection, testing and commissioning of all the equipments and materials to be supplied by the Contractor under first Contract and any other work require to complete the scope for commissioning and handing over of the entire substation.The third Contract shall cover all Civil Works including materials to complete the scope for commissioning and handing over of the entire substation.The Contractor shall be fully responsible for timely execution of all the activities under above three (3) Contracts such that the substation is commissioned and handed over within stipulated completion period.The Contractor shall be fully responsible for the works to be executed under first three (3) Contracts and any breach or occurrence or default under one Contract shall automatically be deemed as a breach or occurrence or default of other Contracts giving the Engineer absolute right to take appropriate action under any/all the Contracts including right to recover damages from any/all the Contracts or terminate any/all the Contracts. Any such breach or default or occurrence in any of the Contracts shall not relieve the Contractor of any of his responsibility /obligations under the other contracts and no time extension shall be given to the Contractor on these grounds. The equipment/material to be supplied by the Contractor under the first Contract when installed and commissioned under the second Contract shall give satisfactory performance in accordance with provisions of the Contract. The signing of three (3) separate Contracts shalt in no way dilute the insurance responsibility and obligations of the Contractor.Notwithstanding executing the separate Contracts and breakup of Contract prices the Contracts shall at all times be construed as a single source responsibility assignment, complete project management, overall co-ordination between civil, electrical supply and erection works for timely commissioning of Substation shall be the Contractors responsibility.Clauses 3.2, 3.3, 3.4, 3.5 and 8.1 of the Special Conditions of Contract is set out hereinbelow:-SCC 3.2 Vetting of DocumentsThe Contractor shall bear all the charges in respect of vetting and execution of Contract documents.SCC 3.3 Aggregate Contract VaueThe sum of Contract Values of first, second, third and fourth Contracts shall be the aggregate Contract value. The limits for quantity variation and penalties for delays shall be 10% of the respective Contract value as under:SCC 3.4 Quantity VariationThe quantities of individual works under any of the above Contracts may very to any extent; however the total value of such variations shall not exceed the 10% of the concerned Contract value.Such variations in quantities/work, under any of the above Contracts, upto 10% of the concerned Contract value shall be allowed by concerned Engineer of Contract. However if such variation is likely to exceed 10% of the Contract value of any Contract, the variation shall be allowed by concerned Engineer of Contract after taking prior concurrence of competent authority.SCC 3.5 Liquidated Damages for Delays in Completion PeriodDamages for delay in completion under clause 32 of Form A shall be applicable with the condition that the liability of delay shall be increased from 10% if the transformer for the first phase of Unnao sub-station do not reach site up to December, 2010. tn view of turn-key nature of contract liquidated damages shall be levied only in case of delay on contractual completion period of that phase of sub-station.SCC 8.1 The prices of imported items, if any, shall be inclusive of all taxes, duties, license fees, import/custom duties etc. legally payable. Any such taxes, duties and levies shall be Contractors account and no separate claim on this account shall be entertained by the Purchaser.30. Pursuant to the said First Contract (Supply Contract) the Respondent submitted two performance bank guarantees on 30th August 2012, that is bank guarantee No. 2012/272 issued by Corporation Bank, Mumbai for an amount of Rs.6092783.00 and bank guarantee No.2012/273 also drawn on the Corporation Bank, Mumbai for an amount of Rs.71068130/-. Respondent No.1 duly performed the first contract under the framework agreement that is the contract for supply of equipment along with accessories and auxiliaries and other related materials and the bills raised were duly cleared.31. Subsequently, there was an audit inspection of the 765 KV Transmission Division, Unnao for the period from April 2012 to April 2016. The audit inspection was conducted by the Audit Officer under the Senior Accountant General during the period from 4th June 2016 to 9th June 2016.32. In the Audit Report, the Accountant General pointed out the lapse on the part of UPPTCL, in not deducting labour cess from the bills of the contractor, that is Respondent No.1, in respect inter alia of the First Conract, observing that every employer was required to levy and collect cess at a rate not exceeding 2% and not less than 1% of the cost of construction incurred by an employer and to deposit the same with the Building and Other Construction Workers Welfare Board.33. By a letter No.184 dated 2nd September 2016, the Executive Engineer of the Petitioner, informed the Respondent No.1 of the objection raised in the Audit Inspection Report regarding non deposit of Labour Cess on the First Contract. It was contended that 1% Labour Cess was to be collected from the contractor on the project cost, which would include supply of equipment and materials as well as erection work. The Respondent No.1 was also informed that simple interest was chargeable on Labour Cess at the rate of 2% per month.34. By a letter dated 14th September 2016, the Respondent objected to the imposition of Labour Cess computed at 1% of the total cost of construction, stating that for the purposes of the first contract, the company was not covered under the definition of contractor under the Act. Thereafter, by a letter dated 27th September 2016, the UPPTCL advised the Respondent No.1 to seek opinion of the Labour Commissioner on the applicability of Labour Cess.35. By a letter dated 14th November 2016, the Respondent No.1 sought the opinion of the Labour Commissioner on the applicability of Labour Cess on the cost of supply of equipment and materials, contending that Labour Cess was not payable under the Cess Act or the BOCW Act on supply of equipment and materials.36. The Respondents also made representations to the UPPTCL for setting aside the demand for cess alleged to be outstanding, on the ground that the first contract was exempted from cess under the BOCW Act and the Cess Act 1996.37. UPPTCL did not release the Performance Bank Guarantee of Rs.7 crore odd furnished by the Respondent No.1, to secure recovery of an amount of Rs.2.6 crores towards cess. Later, the Respondent No.1 extended the validity of the bank guarantee until 30th November, 2018, and further extended the bank guarantee till February 2019.38. In the meanwhile, by a letter dated 1st June 2018, the Superintending Engineer, UPPTCL informed the Respondent No.2 Corporation Bank that consequent upon successful performance of the transformer and isolators supplied by the Respondent No.1, the bank guarantees against the first (supply) contract were partly discharged as detailed in the said letter. The Bank was instructed to retain an amount of Rs.2,60,68,814/- from BG No. 2012/2 dated 30.8.2012 of Rs.7,10,68,130/- and issue an amended Bank Guarantee extending its validity.39. By a letter dated 29th December 2018, the Superintendent Engineer of the UPPTCL requested the Executive Engineer, Unnao to recover labour cess for the supply part of the composite contract from the pending bills of the Respondent No.1 and, in case any amount still remained outstanding, to deduct such amount by encashment of the Performance Bank Guarantee for Rs.2,60,68,814/- held to secure the payment of labour cess.40. On or about 3rd January 2019, the Respondent filed a Writ Petition M/B No.125 of 2019 before the Lucknow Bench of the Allahabad High Court, challenging the said communications. In or about February 2019, while the writ petition was pending, the Executive Engineer, Unnao purported to deposit Rs.38,38,104/- with the Building and other Construction Workers Welfare Board (BOCWWB) as part payment towards labour cess.41. By an interim order dated 7th January 2020, the Honble High Court restrained the UPPTCL from encashing the bank guarantee. The question of law as to whether cess would be payable in respect of supply of equipment by the Respondent no.1 to UPPTCL was kept open.42. UPPTCL filed a Counter Statement to the writ petition and the Respondent filed a Rejoinder thereto contending that the provisions of the BOCW Act were not applicable to the Supply Contract and levy and deduction of labour cess in respect of the Supply Contract, was not permissible in law. UPPTCL did not take any objection to the maintainability of the writ petition on the ground of existence of an alternative remedy, as is evident from its Counter Statement/Affidavit filed in the High Court.43. By the impugned order dated 24th February 2020, the High Court set aside the letters dated 2nd September, 2016 and 29th December, 2018 sent by the Petitioner to the Respondent demanding outstanding labour cess amounting to Rs.2,60,68,814/- computed at the rate of 1% of the contract value.44. The High Court accepted the submission of the Respondent No.1 that in the absence of levy and assessment under the Cess Act 1996 and the Rules made thereunder, the letters of the UPPTCL were not sustainable in law. Cess could only be recovered in the manner stipulated in the Cess Act and the Rules framed thereunder. The High Court observed that if cess were leviable under the Cess Act, it would be necessary for the concerned authorities to undertake the exercise of assessment and levy of cess under the Cess Act of 1996 as amended, before the same could be realized from a contractor. The High Court found that in the absence of any order for levy and assessment under the Cess Act of 1996 recovery could not be made pursuant to an audit objection of CAG.

Reasoning:
10. A perusal of the various provisions of the BOCW Act makes it amply clear that the said Act has been enacted for the welfare of only building and other construction workers and to make adequate provisions for their safety, health and financial security.11. The Cess Act has been enacted to provide for the levy and collection of cess on the cost of construction incurred by employers, with a view to augment the resources of the Building and Other Construction Workers Welfare Boards, constituted under the BOCW Act.45. There does not appear to be any provision in the first contract, second contract, third contract, or fourth contract or in the Special Conditions of Contract or the General Conditions for Supply of Plant and the Execution of work which enables UPPTCL to withhold any amount from the bills raised by the Respondent No.1 on UPPTCL towards any taxes, cess or any other statutory dues of the contractor. Nor has the UPPTCL adverted to any specific provision of the contract which enables UPPTCL to do so. Clause 8.1 of the Special Conditions of Contract relied upon by UPPTCL reads that the prices of imported items, if any, shall be inclusive of all taxes, duties, licence fees, import/customs duties etc. legally payable. Any such taxes, duties levies shall be on Contractors account and no separate claim on the Account shall be entertained by the purchaser. This clause does not authorize UPPTCL to deduct taxes etc. from bills.47. It is nobodys case that Respondent No.1 has committed any breach or default in performance of the First Contract, that is, the Supply Contract, rendering it liable for any damages, costs or expenses. The Respondent No.1 duly discharged its obligations under the First Contract (Supply Contract) to the satisfaction of UPPTCL, and accordingly all payments due to it were cleared. The Performance Guarantees furnished by the Respondent No.1 were also partially discharged except to the extent of covering cess on the First (Supply) contract. This is apparent from the communication of the UPPTCL dated 1st June 2018 to the Bank (Respondent No.2), referred to above.48. As observed above, Clause 8 of the Special Conditions of the Contract merely says that duties, taxes, fees etc. as are legally applicable, shall be paid at actuals by the contractor. This clause does not enable UPPTCL to withhold payments or to realize cess by revocation of a Performance Guarantee.49. In Dewan Chand Builders and Contractors vs. Union of India reported in (2012) 1 SCC 101 , this Court examined the object of the BOCW Act of welfare of workers engaged in building and construction work, and held:- 3The background in which the BOCW Act was enacted, is set out in the Statement of Objects and Reasons appended to the Bill preceding its enactment. To better appreciate the legislative intent, it would be instructive to refer to the following extract from the Statement of Objects and Reasons:It is estimated that about 8.5. Million workers in the country are engaged in building and other construction works. Building and other construction workers are one of the most numerous and vulnerable segments of the unorganized labour in India. The building and other construction works are characterized by their inherent risk to the life and limb of the workers. The work is also characterized by its casual nature, temporary relationship between employer and employee, uncertain working hours, lack of basic amenities and inadequacy of welfare facilities. In the absence of adequate statutory provisions, the requisite information regarding the number and nature of accidents is also not forthcoming. In the absence of such information, it is difficult to fix responsibility or to take any corrective action.Although the provisions of certain Central Acts are applicable to the building and other construction workers yet a need has been felt for a comprehensive Central Legislation for regulating their safety, health, welfare and other conditions of service.5. A fairly long preamble to the BOCW Act is again indicative of its purpose. It reads thus:An Act to regulate the employment and conditions of service of building and other construction workers and to provide for their safety, health and welfare measures and for other matters connected therewith or incidental thereto.7. The Statement of Objects and Reasons to the BOCW Act explained that it had been considered necessary to levy a Cess on the cost of construction incurred by the employers on the building and other construction works for ensuring sufficient funds for tthe Welfare Boards to undertake the social security Schemes and welfare measures. Simultaneously with the enactment of the BOCW Act, the Parliament enacted the Cess Act. The Statement of Objects and Reasons to the Cess Act noted that the intention was to provide for the levy and collection of a Cess on the cost of construction incurred by the employers for augmenting the resources of the Building and Other Construction Workers Welfare Boards constituted by the State Governments under the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Ordinance, 1995.8. It is manifest from the overarching schemes of the BOCW Act, the Cess Act, the Rules made thereunder that their sole object is to regulate the employment and conditions of service of building and other construction workers, traditionally exploited sections in the society and to provide for their safety, health and other welfare measures. The BOCW Act and the Cess Act break new ground in that, the liability to pay Cess falls not only on the owner of a building or establishment, but under Section 2(i)(iii) of the BOCW Act in relation to a building or other construction work carried on by or through a contractor, or by the employment of building workers supplied by a contractor, the contractor. The extension of the liability on to the contractor is with a view to ensure that, if for any reason it is not possible to collect Cess from the owner of the building at a stage subsequent to the completion of the construction, it can be recovered from the contractor. The Cess Act and the Cess Rules ensure that the Cess is collected at source from the bills of the contractors to whom payments are made by the owner. In short, the burden of Cess is passed on from the owner to the contractor.50. In Lanco Anpara Power Limited v. State of Uttar Pradesh and Ors. Repored in (2016) 10 SCC 329 , this Court held:-37. We now advert to the core issue touching upon the construction of Section 2(1)(d) of the BOCW Act. The argument of the appellants is that language thereof is unambiguous and literal construction is to be accorded to find the legislative intent. To our mind, this submission is of no avail. Section 2(1)(d) of the BOCW Act dealing with the building or construction work is in three parts. In the first part, different activities are mentioned which are to be covered by the said expression, namely, construction, alterations, repairs, maintenance or demolition. Second part of the definition is aimed at those buildings or works in relation to which the aforesaid activities are carried out. The third part of the definition contains exclusion clause by stipulating that it does not include any building or other construction work to which the provisions of the Factories Act, 1948 (63 of 1948), or the Mines Act, 1952 (35 of 1952), applies. Thus, first part of the definition contains the nature of activity; second part contains the subject-matter in relation to which the activity is carried out and the third part excludes those building or other construction work to which the provisions of the Factories Act or the Mines Act apply.51. The clear statutory scheme of the BOCW Act excludes a supply contract from within its ambit. On behalf of the Respondent No.1, it is pointed out that several public authorities and corporations, such as the Delhi Metro Rail Corporation and Karnataka Power Transmission Corporation Limited, have issued instructions that no cess under the BOCW Act is leviable on a contract for supply of goods. Copies of the KPTCL circulars dated 22.8.2012 and 28.8.2012 to this effect are annexed to the Rejoinder of the Respondent no.1 in the High Court.52. Under Section 2(g) of the BOCW Act the term Contractor means a person who undertakes to produce a given result for any establishment, other than a mere supply of goods or articles of manufacture, by the employment of building workers or who supplies building workers for any work of the establishment and includes a sub-contractor. The Respondent No.1 is apparently not a contractor, within the meaning of Section 2(1)(g) of the BOCW Act in respect of the first, second and fourth contracts. Nor is the Respondent No.1 employer within the meaning of Section 2(1)(i) of the BOCW Act. Section 2(1)(i) of the BOCW Act defines employer to include the contractor in relation to a building and other construction work carried on by or through a contractor or by employment of building workers supplied by a contractor. The Respondent No.1 neither falls within the definition of contractor in Section 2(1)(g) nor 2(1)(i)(iii) of the BOCW Act. Apparently, the Respondent No.1 is not liable to cess in respect of the First, Second and Fourth contracts.53. Cess under the Cess Act read with BOCW Act is leviable in respect of building and other construction works. The condition precedent for imposition of cess under the Cess Act is the construction, repair, demolition or maintenance of and/or in relation to a building or any other work of construction, transmission towers, in relation inter alia to generation, transmission and distribution of power, electric lines, pipelines etc. Mere installation and/or erection of pipelines, equipments for generation or transmission or distribution of power, electric wires, transmission towers etc. which do not involve construction work are not amenable to Cess under the Cess Act. Accordingly no intimation or information was given or any return filed with the Assessing Officer under the Cess Act or the Inspector under the BOCW Act in respect of the First and Second Contracts, either by UPPTCL or by the Respondent No.1.54. A contractor who enters into a pure Supply Contract is statutorily exempted from levy under the BOCW Act. The Contract in question is a Supply Contract as would be evident from Clause 8.7 of the Special Conditions of Contract which states:The contract shall be a Divisible Contract with single point responsibility, hence no works Contract tax shall be payable and the Purchaser shall not bear any liability on this account.55. Mr. Ramesh Singh appearing on behalf of the Respondent No.1 submitted and rightly, that the four contracts had been treated as a singular contract solely for the purposes of responsibility for timely execution. For all other intents and purposes, including levy of any tax or fees, the contract for supply was understood by the parties as a separate and distinct contract.58. As argued by Mr. Singh, the judgment of this Court in Lanco Anpara Power Limited v. State of Uttar Pradesh and Other reported in (2016) 10 SCC 329 cited on behalf of UPPTCL is of no assistance to UPPTCL since the issues of whether cess under the Cess Act was leviable on a Supply Contract or whether the cost of construction under Section 3 of the Cess Act read with Rule 3 of the Cess Rules included the cost of supply of equipment were not adjudicated in the aforesaid case.59. There can be no comparison between realization of disputed cess by withholding the bills raised by the Respondent No.1 or by invocation of a bank guarantee furnished by the Respondent No.1 after release of payment to the Respondent No.1, and deduction of Income Tax at source which is a statutory obligation of any person making a payment which constitutes income under Section 192 of the Income Tax Act, 1961.60. As observed above, UPPTCL demanded and partly realized cess on the supply Contract, solely on the basis of report of the CAG. In our considered view, in the absence of any adjudication, it was impermissible for UPPTCL to issue the impugned communication to realize cess solely on the basis of the report of the CAG. 61. In Centre of Public Litigation v. Union of India reported in (2012) 3 SCC 1 , this Court held that when CAG report was subject to scrutiny of the Public Accounts Committee and the Joint Parliamentary Committee, it would not be proper to refer to to findings and conclusions contained therein. In this context, reference may also be made to the decision of this Court in Arun Kumar Agrawal v. Union of India and Others reported in (2013) 7SCC 1, where this Court held:-56. CAG may be right in pointing out that public monies are to be applied for the purposes prescribed by Parliament and that extravagance and waste are minimised and that sound financial practices are encouraged in estimating and contracting, and in administration generally.67. The question that is germane for consideration in this case is whether this Court can grant reliefs by merely placing reliance on the CAGs Report. The CAGs Report is always subject to parliamentary debates and it is possible that PAC can accept the ministrys objection to the CAG Report or reject the report of the CAG. The CAG, indisputably is an independent constitutional functionary, however, it is for Parliament to decide whether after receiving the report i.e. PAC to make its comments on the CAGs Report.62. In Pathan Mohammed Suleman Rehmatkhan v. State of Gujarat and Others reported in (2014) 4 SCC 156 , this Court held:-9. We heard Shri Y.N. Oza, the learned counsel for the petitioner and perused the records, as well as counter-affidavit and replyaffidavit filed by the parties before the Gujarat High Court. The entire case of the petitioner is based on the CAG report. The applicability and the binding characteristics of such report were considered by the High Court. In Arun Kumar Agrawal case [Arun Kumar Agrawal v. Union of India, (2013) 7 SCC 1 ] this Court held as follows: (SCC p. 24, para 68)68. We may, however, point out that since the report is from a constitutional functionary, it commands respect and cannot be brushed aside as such, but it is equally important to examine the comments what respective Ministries have to offer on the CAGs report. The Ministry can always point out, if there is any mistake in the CAGs report or the CAG has inappropriately appreciated the various issues.10. The CAG is a key figure in the system of parliamentary control of finance and is empowered to delve into the economy, efficiency and effectiveness with which the departmental authorities or other bodies had used their resources in discharging their functions. The CAG is also the final audit authority and is a part of the machinery through which the legislature enforces the regulatory and economy in the administration of public finance, as has been rightly pointed out by the High Court. But we cannot lose sight of the fact that it is the Government which administers and runs the State, which is accountable to the people. The States welfare, progress, requirements and needs of the people are better answered by the State, also as to how the resources are to be utilised for achieving various objectives. If every decision taken by the State is tested by a microscopic and a suspicious eye, the administration will come to a standstill and the decision-makers will lose all their initiative and enthusiasm. At hindsight, it is easy to comment upon or criticise the action of the decision-maker. Sometimes, decisions taken by the State or its administrative authorities may go wrong and sometimes they may achieve the desired results. Criticisms are always welcome in a parliamentary democracy, but a decision taken in good faith, with good intentions, without any extraneous considerations, cannot be belittled, even if that decision was ultimately proved to be wrong.12. Reference in this regard may also be made to the judgment of this Court in Centre for Public Interest Litigation v. Union of India [(2012) 3 SCC 1  : AIR 2012 SC 3725 ] , wherein it was held that when the CAG report is subject to scrutiny by the Public Accounts Committee and the Joint Parliamentary Committee, it would not be proper to refer to the findings and conclusions contained therein. The Court even went on to say that it is not necessary to advert to the reasoning and suggestions made, as well.63. In this Case, there is apparently no dispute, difference or controversy between UPPTCL and the Respondent No.1 as to the true construction, meaning or intent of any part of the conditions of contract or to the manner of execution or the quality or description or payment for the same. Nor is there any dispute as to the true meaning, intent, interpretation, construction or effect of the clauses of contract, specifications or drawings or any of them. UPPTCL has changed its stand only after the CAG report. Cess in respect of of the First Contract has been deducted only in view of the audit objection raised by the Office of Comptroller and Auditor General (CAG).66. Even though there is an arbitration clause, the Petitioner herein has not opposed the writ petition on the ground of existence of an arbitration clause. There is no whisper of any arbitration agreement in the Counter Affidavit filed by UPPTCL to the writ petition in the High Court. In any case, the existence of an arbitration clause does not debar the court from entertaining a writ petition.67. It is well settled that availability of an alternative remedy does not prohibit the High Court from entertaining a writ petition in an appropriate case. The High Court may entertain a writ petition, notwithstanding the availability of an alternative remedy, particularly (1) where the writ petition seeks enforcement of a fundamental right; (ii) where there is failure of principles of natural justice or (iii) where the impugned orders or proceedings are wholly without jurisdiction or (iv) the vires of an Act is under challenge. Reference may be made to Whirlpool Corporation v. Registrar of Trade Marks, Mumbai and Ors. reported in AIR 1999 SC 22  and Pimpri Chinchwad Municipal Corporation and Ors. V. Gayatri Construction Company and Ors, reported in (2008) 8 SCC 172 , cited on behalf of Respondent No.1.68. In Harbanslal Sahnia and Ors. v. Indian Oil Corporation Ltd. reported in (2003) 2 SCC 107 , this Court allowed the appeal from an order of the High Court dismissing a writ petition and set aside the impugned judgment of the High Court as also the impugned order of the Indian Oil Corporation terminating the dealership of the Appellants, notwithstanding the fact that the dealership agreement contained an arbitration clause.69. It is now well settled by a plethora of decisions of this Court that relief under Article 226 of the Constitution of India may be granted in a case arising out of contract. However, the writ jurisdiction under Article 226, being discretionary, the High Courts usually refrain from entertaining a writ petition which involves adjudication of disputed questions of fact which may require analysis of evidence of witnesses. Monetary relief can also be granted in a writ petition.70. In this case, the action of UPPTCL in forcibly extracting building cess from the Respondent No.1 in respect of the first contract, solely on the basis of the CAG report, is in excess of power conferred on UPPTCL by law or in terms of the contract. In other words, UPPTCL has no power and authority and or jurisdiction to realize labour cess under the Cess Act in respect of the first contract by withholding dues in respect of other contracts and/or invoking a performance guarantee. There is no legal infirmity in the finding of the High Court that UPPTCL acted in excess of power by its acts impugned, when there was admittedly no assessment or levy of cess under the Cess Act.71. Even otherwise, the Cess Act and/or statutory rules framed thereunder prescribe the mode and manner of recovery of outstanding cess under the Cess Act. It is well settled that when statute requires a thing to be done in a particular manner, it is to be done in that manner alone. UPPTCL could not have taken recourse to the methods adopted by it. The impugned communications have rightly been set aside.