Swamiji Construction Company v. State of Haryana & Ors.

***** Mr. Sourabh Garg, Advocate for the petitioner. ***** SUVIR SEHGAL, J.

#1. By way of present writ petition filed under Article 226 of the Constitution of India, petitioner has approached this Court seeking composite relief: firstly, petitioner has sought quashing of termination letter dated 24.06.2026 (Annexure P-14); secondly, quashing fresh tender notice dated 04.07.2026 (Annexure P-16) issued by the respondents and thirdly, for restoration of the contract of the petitioner for the work of “Estimate for Stone Staining at Ghaggar River near Kundhi Bundh at RD 11700 Ghaggar Bundh”.

#2. At the outset, counsel for the petitioner has been confronted with an objection regarding the maintainability of the writ petition as relationship between the parties is purely contractual flowing out of a non-statutory agreement. Moreover, Clause 24 of the Detailed Notice Inviting Tender (DNIT), which forms a bedrock of the -1- CWP No.20759 of 2026(O&M) agreement, provides for a comprehensive multi-tiered Dispute Resolution System (DRS) and the dispute has to be initially referred to the employer defined in the contract, who has to convey his decision within a period of 45 days. In case the petitioner is not satisfied, the dispute has to be referred to a Disputes Review Board (DRB) which shall comprise of three experienced members in the fields mentioned in Clause 24. DRB has to give its decision within 120 days of its constitution or extension, if any, granted thereto and in case the contractor is not satisfied with the decision, it can go to an appropriate Court.

#3. In response learned counsel for the petitioner contends that availability of an alternate remedy is merely a rule of discretion and not an absolute bar on jurisdiction. He has strenuously argued that termination order has to satisfy the test of fairness under Article 14 of the Constitution. He has placed reliance upon a recent judgment of Hon’ble the Supreme Court in Subodh Singh Rathour Vs. Chief Executive Officer and others, AIR 2024 SC 3784 to urge that State action within the commercial sphere would remain subject to judicial review under Article 226 of the Constitution, especially when it is tainted by arbitrariness or denial of a fair opportunity.

#4. We have heard counsel for the parties at length, perused the paper-book with their able assistance and examined the legal position.

#5. It is a settled position of law that when a contract provides for a specific contractually agreed upon DRS, parties must be relegated -2- CWP No.20759 of 2026(O&M) to that forum. High Court while exercising its power under Article 226 of the Constitution must show deference to the mechanism which the parties have voluntarily chosen when entering into a commercial agreement. In State of Uttar Pradesh Vs. Bridge & Roof Co. (India) Ltd, (1996) 6 SCC 22, Hon’ble Supreme Court has observed any dispute pertaining to terms and conditions of a contract must be adjudicated through the dispute resolution machinery specified in the contract. A writ petition under Article 226 of the Constitution is not meant to replace the specialized forum that the parties have voluntarily chosen with open eyes.

#6. This principle has been re-emphasized by a three Judges Bench of the Hon’ble the Supreme Court in Assistant Commissioner of State Tax & Ors. Vs. M/s Commercial Steel Ltd., 2021 SCC OnLine SC 884, wherein it has been held that existence of a multi-tiered alternative remedy is a strong ground for the High Court to decline to exercise its writ jurisdiction unless there is a clear breach of fundamental rights or violation of principles of natural justice or an excess of jurisdiction or challenge is laid to vires of statute or delegated legislation. The present case does not fall in any of the exceptional circumstances.

#7. This restriction applies equally when each contractor challenges a fresh tender process which has been initiated at his risk and cost after the termination of the contract entered into with him. When a contract is terminated due to failure of performance, issuance of consequential fresh tender to complete the work is an expected -3- CWP No.20759 of 2026(O&M) administrative step to protect public interest. Such a step cannot be isolated from the contractual dispute to invoke the jurisdiction of a writ Court. The core issue involved is the breach of the contract by the petitioner which has to be tested before the designated forum laid down under Clause 24 of the agreement.

#8. Reliance placed by the petitioner on Subodh Singh Rathour’s case (supra) is entirely misplaced. The facts and context of that case are distinguishable from the present controversy. In Subodh Singh Rathour’s case (supra), Hon’ble the Supreme Court was dealing with a matter where there was no structured internal multi-tiered DRS available to effectively resolve the dispute between the parties. Moreover, it was held that power under Article 226 of the Constitution is discretionary and plenary.

#9. On the contrary, in the present case, petitioner’s performance of contractual obligation has been highly unsatisfactory and it has failed to maintain the required pace for the completion of flood control works within the stipulated time. In this background, the respondents were constrained to review the matter in view of the risk involved in the case of non-protection before the flood season. Contract was terminated vide impugned letter dated 24.06.2026 (Annexure P-14) and it was ordered that further action will be taken on the risk and cost of the petitioner. Fresh tender has been issued by respondents on the onset of the monsoon season which is in larger public interest and does not require to be interfered with in exercise of the writ jurisdiction. -4- CWP No.20759 of 2026(O&M)

#10. For the foregoing reasons, present writ petition is dismissed on the ground of maintainability. Liberty is granted to the petitioner to invoke DRS as provided in Clause 24 of the agreement.

#11. It is clarified that this Court has not expressed any opinion on the merits of the termination of the contract or its re-tendering. In case, the petitioner invokes Clause 24 ibid, competent authority thereunder shall decide the matter independently, uninfluenced by any observation made herein. All pending application(s), if any, shall stand(s) disposed

#12. of. (SUVIR SEHGAL) JUDGE

10.07.2026 d.gulati (DEEPINDER SINGH NALWA) JUDGE Whether speaking / reasoned : Whether Reportable : Yes Yes No No -5-