Nafr High Court
Case Details
1 BABLU RAJENDRA BHANARKAR Digitally signed by BABLU RAJENDRA BHANARKAR Date: 2025.06.24 17:39:39 +0530 2025:CGHC:27141-DB NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 3135 of 2025 M/s. Welcome Marketing Assistance Through Power Of Attorney Holder Yashwant Kumar Parakh S/o Lalchand Parakh, Aged About 55 Years, R/o 16 New Market, Choubey Colony, Raipur, Tehsil And District Raipur, Chhattisgarh. ... Petitioner versus 1 - Union Of India Through The General Manager, South Eastern Central Railway, 5th Floor, C-Block, Bilaspur, District Bilaspur, Chhattisgarh. 2 - The Divisional Engineer (II), Office Of The Sr. Den (Co-Ord), South Eastern Central Railway, Raipur Division, Raipur, Chhattisgarh. 3 - Senior Divisional Engineer (Co-Ordn) South Eastern Central Railway, Raipur Division, Raipur, Chhattisgarh. ... Respondents For Petitioner : Mr.Shishir Dixit, Advocate For Respondents : Mr.Ramakant Mishra, Deputy Solicitor General Hon'ble Shri Ramesh Sinha, Chief Justice Hon'ble Shri Bibhu Datta Guru , Judge
Decision
Order on Board Per Ramesh Sinha , Chief Justice 24.06.2025 2 1. Heard Mr. Shishir Dixit, learned counsel for the petitioner as well as Mr.Ramakant Mishra, learned Deputy Solicitor General appearing for the respondents. 2. By way of this petition, the petitioner has prayed for following reliefs:- “10.1. That, this Hon'ble Court be pleased to direct the respondents to release the admitted and undisputed amount of Rs. 66,15,625/ which has been withheld vide letter dated 20.3.2013, in the interest of justice. 10.2.That, this Hon'ble Court be further pleased to direct the Confound Respondents to pay compound interest @ 18% per annum on the amount withheld from date it became due till date of realization, in the interest of justice. 10.3 Any other relief which this Hon'ble Court may deem fit be granted.”. 3. Brief facts of the care are that the petitioner is a proprietorship firm mainly engaged in business of execution of railway contracts and work orders relating to Indian Railways. The instant petition is being filed by the petitioner through Power of Attorney Holder Yashwant Kumar Parakh, who has been duly authorized and instructed by proprietor Shri T.L.Parakh vide power of attorney dated 30.12.2002. The petitioner firm from 2005 till 2010 received various contracts and work orders from Respondent Railways for execution of different works to be carried out as per the work orders. The details of agreements 3 are given below for reference: (1) 101/DEN-R/05-06 (ii) 55/DEN-R/09-10 (iii) 62/DEN-R/10-11 DATED 11.11.10 (iv) 61/DEN-R/10-11 DATED 11.11.10 (v) 48/DEN-R/09-10 (vi) 47/DEN-R/10-11 DATED 6.10.10 (vii) 27/DEN-R/10-11 DATED 6.7.10 (viii) 49/DEN-R/09-10 DATED 2.3.10 (ix) 24/DEN-R/07-08 DATED 15.10.07 4. Out of the 9 agreements as mentioned above, in agreement no. 101/DEN-R/05-06, a dispute arose between the parties with regard to material used in the execution of work. The petitioner claimed Rs. 12,00,000/- for the work already done and the respondents raised recovery of Rs. 46,63,677/- for the amount already paid for the work executed by the petitioner. Since the matter could not be settled amicably, the dispute was referred to arbitration, however to initiate recovery the Respondents vide letter dated 20.3.2013 withheld the amount of other agreements of the petitioner Company and kept the same in suspense account and further held that the same shall be payable after the outcome of the decision in the arbitration case. Along with 4 letter dated 20.3.2013, the Respondents annexed the payments of other agreements which has been withheld. 5. With regard to agreement no. 101/DEN-R/05-06, since the respondents could not appoint the arbitrator, the matter was referred to this Court for appointment of arbitrator by way of filing Arbitration Application No. 18/2014, which was disposed off vide order dated 23.12.2016, wherein this Court directed Respondents to send a panel of three gazetted officers of railways to the petitioner for approval of two names as per Clause 64(3)(a)(i) of the General Conditions of Contract. Since the respondents failed to comply with the directions issued by this Court within stipulated time, the petitioner again approached this Court for appointment of arbitrator by way of filing ARBA No. 15/2017, which was finally allowed by this Court vide order dated 06.5.2022 and Hon'ble Mr. Justice Dhirendra Kumar Mishra (Retd.) was appointed as sole arbitrator to resolve the dispute between the parties. 6. After reference of dispute to the Sole Arbitrator, the claim of petitioner and counter claim on behalf of the Respondents was adjudicated by the Sole Arbitrator and final award was passed by the Sole Arbitrator vide award dated 04.07.2023, whereby the claim of the petitioner was allowed and counter claim of the respondents was dismissed. 7. Since the arbitration was awarded in favour of the petitioner, the 5 petitioner vide its letter dated 07.08.2023 requested respondent No. 2 for release of the withheld amount and also claimed interest on the same. 8. Clause 52-A of the General Conditions of Contract specifically states that the amount will be withheld till the claim is finally determined in arbitration, though the withholding amount is legally impermissible and cannot be done but for argument sake even if relevant clause of OCC is taken into consideration, the respondents are duty bound to immediately release the withheld amount on determination of the arbitration which is instant case has already been decided in favour of the petitioner vide award dated 4.7.2023. Since the amount withheld was not being released, the petitioner preferred WPC 4272/2023 before this Court, which was disposed off vide order dated 26.09.2023 directing Respondents to consider and decide the petitioners representation dated 7.8.2023 within 45 days. Pursuant to the direction issued by this Court, the petitioner submitted the copy of order before the Respondent Authorities and Respondents vide order dated 9.11.2023 refused to release the amount citing reasons that they are in process of taking further legal recourse against the award passed by the arbitrator and amount withheld shall be released only after final outcome of the legal proceedings. Subsequently, the Respondents went into to challenge the award of Arbitrator before the Commercial Court Raipur by way of filing application 6 under Section 34 of the Arbitration and Conciliation Act and same was registered as MJC 49/2023 and same was finally decided and partially allowed vide order dated 11.7.2024, wherein the liability of Rs. 15,06,415/- was saddled upon Respondents. In pursuance of the order passed by Commercial Court, the Respondents after deducting 2% TDS on 24.12.2024 made payment of Rs. 15,06,415/- through RTOS to the petitioner. in compliance of arbitration award. That, after making payment of the award amount, the legal proceedings came to an end as was mentioned by Respondents in their letter dated 9.11.2023. That, therefore the Respondents were duty bound to release the amount which was withheld by them, however since the same was not being released, the petitioner vide his letter dated 27.12.2024 again requested for release of withheld amount. Despite making request dated 27.12.2024, the amount was not being released, therefore petitioner again vide his letter dated 10.06.2025 made request for release of withheld amount. The amount was withheld by Respondents on ground that the same shall be released after legal proceedings pertaining to arbitration will reach to final conclusion, which have already reached since the payment pertaining to award was made by Respondents on 24.12.2024, therefore Respondents were duty bound to release the withheld amount which has been withheld since 2013, however the Respondents are not paying heed to the requests made by petitioner and are not releasing the 7 amount withheld, which is arbitrary action, illegal and unjustified act, therefore the instant petition. 9. Learned counsel for the petitioner submits that withholding admitted and undisputed amount of other agreements for initiating recovery of another agreement is impermissible and unjust and in catena of judgments the said action has been deprecated by the Hon'ble Supreme Court and this Court. It is settled law that withholding admitted and undisputed amount payable to the petitioner is arbitrary, unreasonable and violative of Article 14 of the Constitution of India. He further submits that even if Clause 52-A of the GCC is taken into consideration, which provides that withheld amount shall be released on outcome of the arbitration proceedings then on that also the Respondents have failed to adhere by the same. The award has already been passed in favour of the petitioner. Despite that the Respondents are not releasing the withheld amount in favour of the petitioner which is arbitrary, unreasonable and violative of fundamental right of the petitioner. He also submits that the award by the Sole Arbitrator has already been passed in favour of the petitioner and wherein the Sole Arbitrator has held the action of the respondents as unjust, arbitrary and have deprecated the same, despite that the respondents are not releasing the withheld amount. He contended that since 2013, the hard earned money of the petitioner has been kept in suspense account and because of the same, the petitioner has 8 suffered huge loss and for the same the respondents are liable. He contended that the respondents vide their letter dated 9.11.2023 stated that amount shall be released after legal proceedings pertaining to arbitration will come to its logical conclusions, which in instant case came to end up on 24.12.2024, when the Respondents made payment of the 10% award amount, therefore once the said proceedings ended, the Respondents should have immediately made the payment but till date the payment is not being released, which is unjust, arbitrary and illegal act of the Respondents. He further contended that the respondents are making the petitioner run from pillar to post for his own heard earned money, which is causing great mental agony and financial crisis to the petitioner. As such, the writ petition deserves to be allowed. 10. On the other hand, learned Deputy Solicitor General appearing for the respondents opposes the submissions made by learned counsel for the petitioner and submits that the petitioner has an alternative efficacious remedy under the Arbitration and Conciliation Act. As such, the present writ petition as framed and filed is not maintainable. 11. We have learned counsel for the parties, perused the impugned order and other documents appended with writ appeal. 12. It is settled law that the High Court should not exercise its jurisdiction under Article 226 of the Constitution of India when it 9 raises disputed question of facts. 13. The Hon'ble Supreme Court in the case of Chairman, Grid Corpornation of Orissa Ltd. (GRIDCO) and others v. Sukamani Das (Smt.) and another, (1999) 7 SCC 298 was dealing with the question of whether the High Court had made an error in entertaining a writ petition filed seeking compensation for the death of a person due to electrocution, which had allegedly been caused due to the negligence of the authorities. The Supreme Court in the said case observed as under: "6. In our opinion, the High Court committed an error in entertaining the writ petitions even though they were not fit cases for exercising power under Article 226 of the Constitution. The High Court went wrong in proceeding on the basis that as the deaths had taken place because of electrocution as a result of the deceased coming into contact with snapped live wires of the electric transmission lines of the appellants, that "admittedly/prima facie amounted to negligence on the part of the appellants". The High Court failed to appreciate that all these cases were actions in tort and negligence was required to be established firstly by the claimants. The mere fact that the wire of the electric transmission line belonging to Appellant 1 had snapped and the deceased had come in contact with it and had died was not by itself sufficient for awarding compensation. It also required to be examined whether the wire had 10 snapped as a result of any negligence of the appellants and under which circumstances the deceased had come in contact with the wire. In view of the specific defences raised by the appellants in each of these cases they deserved an opportunity to prove that proper care and precautions were taken in maintaining the transmission lines and yet the wires had snapped because of circumstances beyond their control or unauthorised intervention of third parties or that the deceased had not died in the manner stated by the petitioners. These questions could not have been decided properly on the basis of affidavits only. It is the settled legal position that where disputed questions of facts are involved a petition under Article 226 of the Constitution is not a proper remedy. The High Court has not and could not have held that the disputes in these cases were raised for the sake of raising them and that there was no substance therein. The High Court should have directed the writ petitioners to approach the civil court as it was done in OJC No. 5229 of 1995." (emphasis supplied) 14. The aforesaid judgment has been relied/ reiterated by the Supreme Court in S.P.S. Rathore v. State of Haryana and others, (2005) 10 SCC 1 wherein it observed as follows: "16. In Chairman, Grid Corpn. of Orissa Ltd. (Gridco) v. Sukamani Das [(1999) 7 SCC 298] the question which arose for consideration was, can the High Court under Article 226 of the Constitution award compensation for death caused due to electrocution on account of negligence, when the 11 liability was emphatically denied on the ground that the death had not occurred as a result of negligence, but because of an act of God or of acts of some other persons. The Court held that it is the settled legal position that where disputed questions of facts are involved, a petition under Article 226 of the Constitution is not a proper remedy. Therefore, questions as to whether death occurred due to negligence or due to act of God or of some third person could not be decided properly on the basis of affidavits only, but should be decided by the civil court after appreciating the evidence adduced by the parties. In T.N. Electricity Board v. Sumathi [(2000) 4 SCC 543] it was held that when a disputed question of fact arises and there is clear denial of any tortious liability, remedy under Article 226 of the Constitution may not be proper. The Court carved out exception to this general rule by observing that, it should not be understood that in every case of tortious liability, recourse must be had to a suit. When there is negligence on the face of it and infringement of Article 21 is there, it cannot be said that there will be any bar to proceed under Article 226 of the Constitution." (emphasis supplied) 15. Similarly, the Hon'ble Supreme Court in Shubhas Jain v. Rajeshwari Shivam, 2021 SCC OnLine SC 562 has held as under: "26. It is well settled that the High Court exercising its extraordinary writ jurisdiction under Article 226 of the Constitution of India, does not adjudicate 12 hotly disputed questions of facts. It is not for the High Court to make a comparative assessment of conflicting technical reports and decide which one is acceptable." 16. Subsequently, in Union of India Vs. Puna Hinda, (2021) 10 SCC 690, the Hon'ble Supreme Court has observed: "24. Therefore, the dispute could not be raised by way of a writ petition on the disputed questions of fact. Though, the jurisdiction of the High Court is wide but in respect of pure contractual matters in the field of private law, having no statutory flavour, are better adjudicated upon by the forum agreed to by the parties. The dispute as to whether the amount is payable or not and/or how much amount is payable are disputed questions of facts. There is no admission on the part of the appellants to infer that the amount stands crystallised. Therefore, in the absence of any acceptance of joint survey report by the competent authority, no right would accrue to the writ petitioner only because measurements cannot be undertaken after passage of time. Maybe, the resurvey cannot take place but the measurement books of the work executed from time to time would form a reasonable basis for assessing the amount due and payable to the writ petitioner, but such process could be undertaken only by the agreed forum i.e. arbitration and not by the writ court as it does not have the expertise in respect of measurements or construction of roads." 13 17. Recently, the Hon'ble Supreme Court in the case of M.P. Power Management Co. Ltd. v. Sky Power Southeast Solar India (P) Ltd., (2023) 2 SCC 703, while dealing with the issue of exercise of writ jurisdiction by a Court in matters arising out of a contract, has stated: "82.7. The existence of an alternate remedy, is, undoubtedly, a matter to be borne in mind in declining relief in a writ petition in a contractual matter. Again, the question as to whether the writ petitioner must be told off the gates, would depend upon the nature of the claim and relief sought by the petitioner, the questions, which would have to be decided, and, most importantly, whether there are disputed questions of fact, resolution of which is necessary, as an indispensable prelude to the grant of the relief sought. Undoubtedly, while there is no prohibition, in the writ court even deciding disputed questions of fact, particularly when the dispute surrounds demystifying of documents only, the Court may relegate the party to the remedy by way of a civil suit." (emphasis supplied) 18. A reading of the aforesaid judgments makes it clear that it is well settled proposition of law that when there are disputed question of facts involved in a case, the High Court should not exercise its jurisdiction under Article 226 of the Constitution of India. It has been held that the remedy under Article 226 of the Constitution of India may not be proper. 14 19. From perusal of the pleadings, it appears that the petitioner has prayed for issuance of direction to the respondents to release the admitted and undisputed amount of Rs.66,15,625/- which has been withheld by the respondents vide letter dated 20.03.2013 and also prayed for issuance of direction to the respondents to pay compound interest @ 18% per annum on the amount withheld from date it became due till date of realization. 20. In the instant case, the relief of admitted and undisputed amount sought by the petitioner is contingent upon the resolution of the disputed question of facts raised, and these questions cannot be adjudicated under Article 226 of the Constitution of India. In view of the aforesaid, it would not be appropriate for this Court to entertain the instant writ petition as there are disputed questions of fact involved. 21. Considering the submissions advanced by learned counsel for the parties, further considering the disputed questions of law involved in this writ petition, the relief sought by the petitioner and in view of law laid down by the Supreme Court in the above-stated judgments (supra), we do not find any good ground to entertain this writ petition. 22. Accordingly, the writ petition being devoid of merit is liable to be and is hereby dismissed. However, liberty is reserved in favour of the petitioner to take recourse to other alternate remedies 15 available to him under the law. No cost(s). Sd/- Sd/- (Bibhu Datta Guru) (Ramesh Sinha) Judge Chief Justice Bablu