Case: Sewaram Vs. Sobaran Singh

Election for the Morena Legislative Assembly Constituency in State of Madhya Pradesh was held on February 27, 1990. Sewaram, the appellant before us having secured 25, 509 votes was declared elected. Sobaran Singh, the respondent in this appeal being one of the defeated candidates having secured 19, 055 votes filed an election petition under Sections 80 and 84 read with Section 100 of the Representation of the People Act of 1951 (hereinafter referred to as the Act) challenging the election of Sewaram. The ground for challenge was based on the allegation that on the date of filing the nomination paper on February 1, 1990 and declaration of the result of the election on February 28, 1990, Sewaram was having contracts entered with the Madhya Pradesh Government subsisting and as such he was disqualified under Sectionof the Act. The details of the subsisting contracts with the Government were given as under in paragraph 4 of the electionA contract with M.P. Government through the Managing Director, M.P. Industrial Area Development Corporation Ltd., Gwalior for construction of W.B.M. Road in Industrial Estate, Malanpur, Distt. Behind of M.P. The contract is for Rs. 51 lakhs. The work order was issued on December 29, 1988 and the date of completion mentioned in the contract is March 28, 1990. Under this contract, the 10th running bill of Rs. 1, 63, 805 is paid on February 10, 1990 and the construction work is still incomplete and being carriedAnother contract with M.P. Government through the same authority mentioned in the above clause No. (a) for the construction of W.B.M. Road in Industrial Estate, Malanpur, Distt. Behind of M.P. This contract is for Rs. 55 lakhs. The work order was issued on November 10, 1989. The work under this contract is still being carried on. The aforesaid corporation mentioned in Para 4(a) and (b) is a subsidiary corporation of the M.P. Industrial Development Corporation Ltd., Bhopal and the said Managing Director, Gwalior is a permanent Government servant. The Industries Department of the M.P. Government is the real owner and controller of these corporations. The total finances and assets of these corporations belong to the Government of M.P. In brief, these corporations are Government corporations. Its functions are akin to the Public Works Departments of M.Pc) A contractual agreement with the Governor of M.P. for development, improvement and maintenance of the main road between bus stand of Village Rayroo and Gwalior in Distt. Gwalior (M.P.). This agreement No.is for Rs. 37, 96, 500. The work order No. 2477 was issued on April 16, 1987 by the Executive Engineer of PWD of M.P. The running bill for Rs. 2, 22, 416.87 is paid in the month of March 1990 by a cheque issued by the Public Works Department of M.P. The work under this contract is still continuing. The aforesaid work is undertaken and carried on by Madhya Pradesh Public Works Department under M.P. Works Department Manual of 1983 published in M.P. Government Gazette Extraordinary dated January 20, 1984. The aforesaid portion of the road is part of the road named as National Highway No. 3 but it is under the jurisdiction of the Government of M.P. As per the provisions of the National Highway Act and related provisions of the law, the road is under the M.P. Government. The Central Public Works Department has nothing to do with the impugned contract.Sewaram filed a reply to the election petition and denied that the alleged contracts mentioned in Para 4(a) and (b) of the petition with the M.P. Audyogik Kendra Vikas Nigam (Gwalior) Ltd., (in short MPAKVN) are the contracts/works undertaken by the Madhya Pradesh Government. It was submitted that the said Nigam is a Limited Company incorporated under the Companies Act, 1956 and as such is an independent and sovereign body corporate with perpetual succession, seal and power to hold and manage its own property. It was, therefore, denied that the Industries Department of the Government of Madhya Pradesh was the real owner of the said Company. As such, it was also denied that the contracts with the said Company can be termed as contracts with the appropriate Government, in terms of Sectionof the Act

Court's reasoning:
15. We have given our thoughtful consideration to the arguments advanced by learned counsel for both the parties and also thecited at the Bar. The question of subsistence of as contract with the appropriate Government making it a disqualification under Sectionof the Actis a question of fact depending on the facts and circumstances of each case. In Abdul Rahiman Khan v. Sadasiva Tripathi ( 1969 (1) SCR 351 : 1969 AIR(SC) 302 : 39 ELR 92) the respondent was declared elected to the Legislative Assembly of Orissa from the Nowrangpur General Constituency. The appellant filed an election petition before the High Court of Orissa for an order setting aside the election of the respondent, on the ground that the appellants nomination paper was improperly rejected he was illegally deprived of his right to contest the election. It was as common ground that the appellant was carrying on the business of as building contractor and that in pursuance of a notification issued by the Government of Orissa he had submitted tenders for construction of buildings of the Rental Housing Scheme the rates specified therein. The tenders were accepted and the appellant had carried out a part of the construction work, but had thereafter stooped the work because he suffered serious injuries which necessitated his detention in public hospital. The appellant claimed that at his request the contract was cancelled, and on that account at the date of filing of his nomination there was, between him and the State of Orissa no subsisting contract for execution of works undertaken by him, and that in any event there was in law no contract between him and the State relating to the execution of works which disqualified him from standing for the election as a candidate for a seat in the State LegislativeIn the facts and circumstances of the above case, it was held that the appellant had commenced execution of the work, but had not completed it. Payment for the work done was not made to the appellant. The contract was not determined by mutual agreement nor was itIn order to decide the controversy, we shall now take into consideration the facts of the case in hand. It is an admitted position that Sewaram in his individual capacity had submitted a tender/application on November 6, 1986 for seeking the contract for raising of floodable reach in K.M. 105 to 108 of A.B. Road on National Highway No. 3 for an amount of Rs. 37, 96, 500. This tender for the above work was accepted in favour of Sewaram by the Executive Engineer, PWD, National Highway Division, Gwalior on behalf of the Governor, Madhya Pradesh on April 16, 1987. Clause (25) of the contract clearly provide that the contract shall not be assigned orwithout the written approval of the Divisional Officer. Admittedly the firm M/s Sewaram Gupta itself came into existence in 1988 and the contract made originally in favour of Sewaram in his individual capacity could not have been assigned or transferred in favour of the firm without the consent of the Divisional Officer. Even otherwise, there is nothing on record to show that at any time during the subsistence of this contract Sewaram had ever intimated the PWD that the contract may be transferred or assigned in favour of the firm nor any correspondence ever shows that the PWD had accepted such transfer or assignment impliedly or expressly in favour of the firm M/s Sewaram Gupta. Thus, it is established beyond any manner of doubt that till February 1, 1990 the date of filing the nomination paper, the contract with PWD was continuing and dealt with Sewaram in his individual capacity and not with the firm Sewaram Gupta. The appellant has taken the stand that an agreement was executed between him and Patiram on December 31, 1989 by which he gave up his interest in the existing contract with PWD and MPAKVN and executed another document on the same day dissolving the partnership firm and a new partnership deed was executed on the same date between Patiram and other persons. There is a serious controversy raised in this regard on behalf of the respondent that all these documents as alleged to have been executed on the stamp paper supplied by one Narayan Swaroop Saxena, stamp vendor are forged and void. This Narayan Swaroop Saxena has appeared in theand has deposed that he did not enter the sale of the stamps to the appellant Sewaram in his register and has further admitted that the stamp paper alleged to have been sold to appellant Sewaram bearing the serial number 13429 had been sold to a third party stranger namely Budh Ram who had purchased the same on behalf of a lady Radha Bai. It has also been argued on a behalf of the respondent that the notary Shri Chhinga Lal Gupta was a relation of Sewaram and though there were various notaries having jurisdiction in Morena, the documents was got notarised from Shri Chhinga Lal Gupta, a notary from Gwalior. Many other circumstances have been shown in order to establish that all the documents brought into existence on December 31, 1989 were forged and manufactured, but we do not consider it necessary to record a positive finding in this regard, in view of the fact that nothing material turns out on these documents for deciding the main controversy raised in the present case. Even it, for arguments sake it may be admitted that Sewaram had dissolved the partnership firm M/s Sewaram Gupta and Patiram was introduced as a new partner in this firm on December 31, 1989, it is neither established in fact, not it was permissible to transfer or assign the contract in favour of the firm at any time without the approval of the Divisional Officer as per terms of clause (25) of theNow we shall consider the main plank of the contention on which the entire edifice has been built by Sewaram that he had submitted a letter dated January 30, 1990 whereby he had severed all his connections with the contract in question and after this date there was no subsisting contract so as to incur any disqualification under Sectionof a Act. Admittedly, this letter dated January 30, 1990 is addressed to the Executive Engineer, but in fact, it was delivered not in the office of Executive Engineer Mr. Mandloi, but had been delivered in the office of theOfficer Mr. Srivastava. It is important to note that all correspondence in respect of the contract in question has been done by Sewaram with the office of the Executive Engineer except the letter dated January 30, 1990 in question which alone according to the appellant had been submitted to Shri V. P. Srivastava, theOfficer sitting in a different office and far away from the office of the Executive Engineer. According to Sewaram, one Rajesh Verma accompanied him while delivering this letter to Srivastava, but according to Srivastava, Patiram had accompanied Sewaram and not Rajesh Verma. It cannot be believed that when all correspondence relating to the contract was dealt with by the office of the Executive Engineer, why such an important letter dated January 30, 1990 was not submitted in the office of the Executive Engineer and is alleged to have been submitted to a lower authority of the rank of Assistant Engineer. We see force in the submission of the learned counsel for the respondent in this regard that Shri Mandloi, the Executive Engineer was not willing to oblige the appellant by taking a false stand and as such the appellant took a false plea that he had given such letter dated January 30, 1990 to Mr. Srivastava. It is important to note that Mr. Mandloi in his statement has clearly stated that he never saw nor had any knowledge of the letter dated January 30, 1990 prior to July 23, 1990. Even if, for arguments sake it may be considered that the appellant had submitted the letter dated January 30, 1990 bonafidely for some reasons on the same day in the office of the Assistant Engineer Mr. Srivastava, it was incumbent upon the appellant to see that the letter should have reached immediately in the office of the Executive Engineer who alone was competent to deal with such important matter. Admittedly, the letter was addressed to the Executive Engineer and it came to his notice on July 23, 1990 after the service of the notice of the election petition on the appellant. The contract can come to an end by any of the following modes(1) By performance;(2) By express agreement;(3) Under the doctrine of frustration; and(4) Byare not satisfied that in the present case the contract came to an end by breach by writing the letter dated January 30, 1990 as sought to be submitted on behalf of the appellant. In the facts of the present case the contract had not come to an end but was sought to be continued through Patiram Gupta. It is an admitted fact that Patiram Gupta is the real brother of and member of joint Hindu family with Sewaram appellant. Not only that, Patiram was also anof Sewaram during the relevant period. The correspondence even after January 30, 1990 has been made in the name of Sewaram appellant though signed by Patiram. In these circumstances, it cannot be believed that Sewaram had put an end to the contract by breach and the conduct of Sewaram and Patiram even prior to and after January 30, 1990 leads to an irresistible conclusion that the contract had not come to an end, and was subsisting, thereby incurring a disqualification under Sectionct. Incase Sewaram wanted to put an end to the contact, in the normal course of behaviour and human conduct he should have gone personally to no less an authority than the Executive Engineer to put an end to the contract mutually then he could have taken the step of ending the contract unilaterally by breach taking the risk of damages. The facts of the present case lead us to the conclusion that the appellant never intended nor in fact put an end to the contract, but continued with the contract through the proxy of his real brotherIn the circumstances mentioned above, we are in agreement with the findings recorded by the High Court in this regard that the contract with the PWD was subsisting on the date of filing the nomination and the date of scrutiny of the nomination papers and the appellant thus incurred afor contesting the election of Morena Assembly Constituency in the State of Madhya Pradesh