Nafr High Court
Case Details
1 2025:CGHC:30318 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR (Order reserved on 01/07 /2025) (Order Delivered on 03 / 07/2025) WPC No. 3240 of 2025 Madhu Agrawal (Proprietor-M/s Madhu Enterprises) W/o Omprakash Agrawal, Aged - 54 Years, R/o Tilai, Tahsil - Akaltara, District Janjgir Champa (C.G.) ... Petitioner versus 1 - Union of India Through - Deputy Secretary, Ministry of Consumer Affairs, Food and Public Distribution Department of Food and Public Distribution, Krishi Bhawan New Delhi. 2 - State of Chhattisgarh Through Secretary Department of Food, Civil Supplies And Consumer Protection, Mahanadi Bhawan Mantralaya, New Raipur, Atal Nagar, District Raipur (C.G.) 3 - Managing Director Chhattisgarh State Market Federation Maryadit, Atal Nagar, Naya Raipur, District Raipur (C.G.) 4 - C.G. State Civil Supplies Corporation Limited, Janjgir-Champa, District - Janjgir-Champa (C.G.) 5 - Collector (Food Department) Janjgir-Champa, District Janjgir-Champa (C.G.) 6 - District Marketing Officer Department of Food, Civil Supplies and Consumer Protection Janjgir - Champa, District Janjgir-Champa (C.G.) 7 - Food Corporation of India (F.C.I.) Regional Office - Mova, Vidhan Sabha Marg, Raipur, District Raipur (C.G.) ... Respondents For Petitioner : Ms. Reena Singh, Advocate For Union of India
Legal Reasoning
: Mr. Tushar Dhar Diwan, CGC For State/Respondents No.2 & 5 : Mr. Satish Gupta, GA For Respondents No.3 & 6 For Respondent No.7 : : Mr. Shreyansh Mehta, Advocate Mr. R.S. Patel, Advocate along with Mr. Ashish Sahu, Advocate ASHUTOSH MISHRA Digitally signed by ASHUTOSH MISHRA Date: 2025.07.04 11:12:53 +0530 2 Hon'ble Shri Justice Arvind Kumar Verma CAV Order Heard. 1. The petitioner has filed the instant writ petition challenging the recovery order dated 22/05/2025 & 19/06/2025 issued by Respondent No.6, whereby the Respondent has directed/ordered the petitioner to deposit sum of Rs.44,22,236/- (Forty Four Lakhs Twenty Two Thousand Two Hundred and Thirty Six Rupees), failing which the said amount will be recovered from the Bank Guarantee /FDR deposited by the petitioner in lieu of Custom Milling of Paddy in the Kharif Marketing Year 2023-24. 2. By way of the instant petition, the petitioner is praying for the following relies:- (i) That, this Hon’ble Court may kindly be pleased to set aside the impugned Recovery order dated 22.05.2025 issued by respondent no.6 for sum of Forty Four Lakh Twenty Two Thousand Two Hundred and Thirty Six Rupees (Rs.44,22,236/- Lakhs), being against the principle of natural justice and further direct the concerned respondent no.6 to accept the balance of CMR of 1246.874 Quintals of Kharif year 2023-24 in the light of notification dated 29.05.2025 issued by respondent no.3, in the interest of justice. (ii) That, the Hon’ble High Court may further protect the petitioner from Recovery by respondents, either-by forfeiting/ confiscation of the bank guarantee/ FDR and Post Dated Cheques of the petitioner deposited as security with the bank for this Kharif year 2023-24 or by any other mode or manner, in the interest of justice. (iii) This Hon’ble Court may kindly be pleased to grant any other relief(s)/ writ(s), order(s) in favor of the petitioner, which the Hon’ble Court deemed fit & just in the facts & circumstances of the case. 3. The brief facts of the case are that the petitioner for the purpose of 3 Custom Milling Policy in the Kharif Marketing Year 2023-24, enter into a contract with the government and contract letter has been executed between District Marketing Officer, District Janjgir- Champa i.e. respondent no. 6 on behalf of Chhattisgarh State Co-Operation Association Limited as First party and the petitioner i.e. i.e. Second Party Madhu Agrawal (Proprietor of firm (Proprietor M/S Madhu Enterprises), Tilai, Tahsil-Akaltara, District- Janjgir Champa (C.G.), under Chhattisgarh Custom Milling Instructions of the Government, C.G. Government, Department of Food, Civil Supplies and Consumer Protection, Ministry of Raipur Nava Raipur, under the instructions issued regarding custom milling of paddy procured in the year 2023-24. 4. As per the agreement, executed in accordance with the Chhattisgarh Government’s Custom Milling Instructions, the petitioner has uplifted Total 8740 Quintals of paddy i.e. (FCI Arwa- 8260, Naan Arwa-480) and as per contract agreement clause between the parties the petitioner has to deposit 67% of custom milled rice of Arwa of FCI & Naan i.e. of total 5914.36 (FCI 5589.542 + 324.816 (naan) Quintals and with regard to which PDC cheques and Bank guarantee has already been taken from the petitioner. 5. The petitioner has already started depositing/submitting the custom milling rice day by day and till date he has completely deposited Naan Arwa custom milled Rice and out of FCI Arwa of 5589.542 Quintals, till date the petitioner has deposited 4342.668 Quintals and for remaining balance 1246.874 Quintals, the petitioner was and is ready and willing to deposit/submit the same within the extended time. 4 6. The grievance of the petitioner is that the Respondent No.3 is not accepting the balance of 1246.874 Qunitals of the petitioner even after the order of this Court passed in WPC No.2400/2025 dated 08/05/2025 & in WPC No.799 of 2025 dated 06/02/2025 and instead the Respondent No.6 has issued recovery order dated 22/05/2025 and the petitioner has filed reply to the aforesaid notice on 16/06/2025 and even after receiving the representation the balance of 1246.874 Quintals of CMR of 2023-24 has not yet been accepted by the Respondent No.6. 7. Learned counsel for the petitioner would submit that due to arbitrary and wrongful approach of the respondents, the petitioner has been debarred from depositing the balance of 1246.874 Quintals of Custom Milled Rice of the year 2023-24 and the recovery order dated 22/05/2025 has been issued just to harass the petitioner. She would next contend that the petitioner is ready and willing to deposit the remaining balance Custom milled rice from his end but the concerned respondent is not accepting the balance of CMR of 1246.874 Quintals of Kharif year 2023-24 even after their own notifications and the last date for depositing the CMR has now been extended for depositing CMR of 2023-24 vide notification dated 29.05.2025 from 10.05.2025 to 30.06.2025. Therefore, it is prayed that the recovery order dated 22.05.2025 may be set aside and the Respondent No.6 be directed to accept the balance of CMR of 1246.874 Quintals of Kharif year 2023- 24 in light of the notification dated 29.05.2025. 8. Learned counsel for the Markfed submits that the Markfed functions 5 purely as a facilitator and intermediary in the execution of custom milling agreements. It operates strictly in accordance with the directions issued from time to time by the Central Government, the State Government, and the Food Corporation of India (FCI). Markfed has no independent authority to take policy decisions or deviate from binding directives. They would further submit that in case of any dispute the petitioner may take recourse to the arbitration clause as provided in the agreement. 9. I have heard learned counsel for the respective parties at length and perused the record with utmost circumspection. 10.Clause 5.1 of the agreement states as under: 5-1- vikktZu [email protected] dsUnz ls /kku mBkus gsrq i{k dzekad 02 }kjk dEI;wVj ds ek/;e ls fMyhojh vkMZj ¼Mh-vks-½ gsrq vkosnu djsxkA ftl i{k dzekad 01 dh vksj ls lacaf/kr jktLo ftys ds ftyk foi.ku vf/kdjh ds }kjk vuqeksfnr dj tkjh fd;k tkosxk] tks vgLrkarj.kh gksxkA foHkkxh; lkQVos;j vuqlkj miktZu [email protected] dsUnz }kjk Mh-vks- dk lR;kiu fd, tkus ds mijkar tkjh fd;s x;s fMyhojh ds vuqlkj gh i{k dzekad 02 dks lacaf/kr miktZu [email protected] dsUnz ls fMyhojh vkMZj tkjh gksus dh frfFk ls 10 fnol ds vUbnj Mh-vks- esa mYysf[kr lEiw.kZ /kku dk ifjnku izkIr djus ds fy;s ck?; gSA ;fn i{k dzekad 02 }kjk 10 fnol ds Hkhrj /kku dk mBko ugha rks fu;ekuqlkj n.M vf/kjksifr fd;k tkosxkA fo”ks”k ifjfLFkfr;ksa es xq.k nks”k ds vk/kkj ij ijh{k.k mijkar i{k dzekad 02 dks vFkZn.M esa ----------- 11.Clause 14.1 of the agreement states as under: 14-1 bl lafonk djh fdlh Hkh dafMdk ls lacaf?kr fookn mRuUu gksus dh fLFkfr esa mHk;i{kksa }kjk fookn ds lkSgknZiw.kZ lek/kku ds fy, ftyk dysDVj dks vH;kosnu izLrqr fd;k tk ldsxkA ftyk dysDVj }kjk mDr vH;kosnu esa fd;k x;k fu.kZ; mHk;i{kksa dks ekU; gksxkA 12.Clause 15.1 and 15.2 of the agreement states as under: 15-1 vuqc/k dh dafMdk 14-1 ds varxZr lacaf/kr ftyk dysDVj }kjk fd;s x;s fu.kZ; ds fo:) mHk;i{kksa }kjk fookn ds fu.kZ; gsrq 60 fnol ds Hkhrj vkchVs’ku gsrq N-x- e/;L;re vf/kdj.k jk;iqj ¼N-x-½ ds le{k vkosnu izLrqr fd;k tk ldsxk] ftldk fu.kZ; vafre gksxk tks vHk;i{kksa dks ekU; gksxkA 15-2 vkchZVªs’ku esa fd;s x;s fu.kZ; ls ;fn mHk; i{k esa ls dksbZ vlarq”V gksrk gS] rks og vU; fof/kd izko/kkuksa dk mi;ksx dj ldsxkA 13. The petitioner claims that she is ready and willing for depositing the 6 remaining balance Custom milled rice from his end but the concerned respondent is not accepting the balance of CMR of 1246.874 Quintals of Kharif Year 2023-24 despite the fact that the last date for depositing the CMR of 2023-24 has been extended. 14. Hon’ble Supreme Court in the matter of Goyal Rice Industries Vs. State of Punjab (2016) SCC Online P&H 9853 is apt in underscoring the principle that disputes under such agreements are better resolved through arbitration and has held as under: “9. It is argued by learned counsel for the respondents that the petitioners are claiming paddy out of release order from outside his district. It is further argued that the petitioner has a right of Arbitration as per the Policy, which may be invoked in order to decide the interpretation of the provisions of the Policy of KMS 2015-16 on the basis of which the petitioners may set up their claim for the alleged losses, if any. 10.1 I have heard learned counsel for the parties in detail and also perused the available record. Once, it is not disputed by the respondents that the petitioner has right of seeking arbitration, it would be in the interest of parties to avail the remedy, which is so provided in clause 19 of Custom Milling Policy of 2015-16, which read as under: “All the disputes and differences arising out of or in any manner touching or concerning the agreement whatsoever shall be reered to the sole arbitration of the Managing Director of the concerned agency or any person appointed y him in this behalf. There will be no objection to any such appointment that the person appointed is or was an employee of the Food and Supplies Department, Punjab or the concerned agency or that he had to deal with the matter to which the contract relates and that in the course of his duties such an employee of the Food and Supplies Department, Punjab or the concerned agency had expressed views on all or any of the 7 matter in dispute or difference. The award of such arbitration shall be final and binding on the parties to this contract. It is a term of this contract that in the event of the Arbitrator being transferred or vacating his office or being unable to act for any reason, the Managing Director concerned at the time of such transfer, vacation of office, death or inability shall appoint another person to act as Arbitrator. Such a person shall be entitled to proceed with reference from and the state where it was left by his predecessor. Provided that any demand for arbitration in respect of any claim(s)/dispute between both the parties, under the contract shall be in writing and made within one year of the date of completion or expiry of the period of contract. If the demand is not made within the period, the claim(s) of the Miller shall be deemed to have been waived off and the agency shall be released of all liabilities under the contract in respect of these claims. The cost for and in connection with arbitration shall be the discretion of the arbitrator who may make suitable orders in his award. Subject as aforesaid, the Arbitration and Conciliation Act, 1996 or any statutory re-enactment on modifications thereof shall apply to the arbitration provided under this clause. However, the cases of fraud, theft or misappropriation etc. on the part of the miller are not covered under this clause and in such cases legal proceedings as deemed fit shall be initiated by the agency against the miller as well as against the sureties.” 11. In view of the aforesaid, the parties are relegated to the remedy of arbitration and hence the present petitions are hereby disposed of accordingly.” 15. From the above decision in similar circumstances it has been held that when contractual remedy by way of arbitration is available and the dispute pertains to interpretation of policy or contract terms, parties must avail such remedy rather than invoking the writ jurisdiction. It is ordered accordingly. 16.
Decision
In view of the above, this Court does not find any good ground to grant 8 the reliefs as prayed for in this writ petition and the same does not call for interference in exercise of extraordinary jurisdiction under Article 226 of the Constitution of India. 17. Accordingly, the present writ petition is disposed of with the aforesaid observation. SD/- (Arvind Kumar Verma) Judge Ashu