# M/s Badri Narayan Shukla v. State of U.P. & Ors

- **Citation:** (2021) 2 ILRA 267
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2020-12-15
- **Case number:** Writ C No. 13291 of 2020
- **Bench:** Surya Prakash Kesarwani, Dr. Yogendra Kumar Srivastava
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/m-s-badri-narayan-shukla-v-state-of-u-p-ors-46149
- **Pages:** 15

## Headnote

Constitution of India, Art.226 - Writ
jurisdiction - extraordinary remedy -
Contractual matters - Maintainability -
Pure contractual obligation in the absence
of any statutory complexion would not be
enforceable through a writ. - In case
where contract entered into between
State & person aggrieved is of non -
statutory character and relationship is
governed purely in terms of contract
between
parties,
in
such
situations
contractual obligations are matters of
private law and writ would not lie to
enforce civil liability arising purely out of
contract - Proper remedy would be to file
civil suit for claiming damages, injunctions
or
specific
performance
or
such
appropriate reliefs in civil court - only
268 INDIAN LAW REPORTS ALLAHABAD SERIES
exception may be a case where the
amount is admitted and there is no
disputed
question
of
fact
requiring
adjudication of detailed evidence and
interpretation of the terms of the contract.
(Para 26, 27)

Vide impugned order tender of the petitioner
was rejected & contract awarded to him was
cancelled - also claim raised for payment of a
balance amount to the petitioner in respect of
the completed work - Held - petitioner seeks to
enforce
commercial
contractual
rights
&
obligations - reliefs sought require adjudication
of serious factual disputes relating to the terms
of the contract in respect of the prescribed
standards of work and the time schedule for its
completion - serious dispute with regard to the
extent of the work completed and the payments
which are due - writ petition in such matters is,
not to be entertained - appropriate remedy is to
approach
the
civil
court
or
to
initiate
proceedings for arbitration.

Writ Petition dismissed. (E-4)

List of Cases cited: -

## Text

_Characters 0–39,635 of 51,236. This is a partial read: ask again with offset=39635 for what follows._

2 All. M/s Badri Narayan Shukla Vs. State of U.P. & Ors.
267
competent authority for issue of completion
certificate.

18. It therefore follows that in the case
of a project where all development works
have not been completed, the mere filing of
an application with the competent authority
for issuance of completion certificate would
not bring it out from the purview of an
'ongoing project', as defined under Rule 2 (h)
of the Rules, 2016. Such projects would
accordingly be held to be 'ongoing projects'
and in terms of the proviso to Section 3 (1) of
the Act, 2016, the promoter would be liable
to make an application to the authority for
registration of the said project within the
stipulated time period.

19. In the instant case, the findings
recorded by the RERA Authority which are
based on a consideration of the material
evidence on record are to the effect that the
development works in respect of the project
were not completed. Accordingly, the project
cannot be said to be excluded under Rule 2
(h). The project has therefore rightly been
held to be an 'ongoing project' within the
meaning of Rule 2 (h) and it would require
registration under the proviso to Section 3 (1)
of the Act, 2016. Accordingly the matters
pertaining thereto would fall within the
jurisdiction of the RERA Authority.

20. The impugned orders passed by the
RERA Authority, therefore, cannot be held to
be without jurisdiction.

21. Counsel for the petitioner has not
been able to point out any material error or
perversity in the findings of fact recorded by
the RERA Authority, in this regard, in the
impugned orders.

22. Under the circumstances, no
interference
can
be
made
with
the
impugned orders under Article 226 of the
Constitution of India inasmuch as the
matter is concluded by findings of fact.

23. For all reasons aforestated, the
writ petition is dismissed.
----------
(2021)02ILR A267
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 15.12.2020

BEFORE

THE HON'BLE SURYA PRAKASH
KESARWANI, J.
THE HON'BLE DR. YOGENDRA KUMAR
SRIVASTAVA, J.

Writ C No. 13291 of 2020

M/s Badri Narayan Shukla ...Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Vikrant Pandey, Sri Santosh Kumar
Shukla

Counsel for the Respondents:
C.S.C.

Constitution of India, Art.226 - Writ
jurisdiction - extraordinary remedy -
Contractual matters - Maintainability -
Pure contractual obligation in the absence
of any statutory complexion would not be
enforceable through a writ. - In case
where contract entered into between
State & person aggrieved is of non -
statutory character and relationship is
governed purely in terms of contract
between
parties,
in
such
situations
contractual obligations are matters of
private law and writ would not lie to
enforce civil liability arising purely out of
contract - Proper remedy would be to file
civil suit for claiming damages, injunctions
or
specific
performance
or
such
appropriate reliefs in civil court - only
268 INDIAN LAW REPORTS ALLAHABAD SERIES
exception may be a case where the
amount is admitted and there is no
disputed
question
of
fact
requiring
adjudication of detailed evidence and
interpretation of the terms of the contract.
(Para 26, 27)

Vide impugned order tender of the petitioner
was rejected & contract awarded to him was
cancelled - also claim raised for payment of a
balance amount to the petitioner in respect of
the completed work - Held - petitioner seeks to
enforce
commercial
contractual
rights
&
obligations - reliefs sought require adjudication
of serious factual disputes relating to the terms
of the contract in respect of the prescribed
standards of work and the time schedule for its
completion - serious dispute with regard to the
extent of the work completed and the payments
which are due - writ petition in such matters is,
not to be entertained - appropriate remedy is to
approach
the
civil
court
or
to
initiate
proceedings for arbitration.

Writ Petition dismissed. (E-4)

List of Cases cited: -

1. Radhakrishna Agarwal & ors. Vs St. of Bih. &
ors.

2. Bareilly Dev. Auth. & ors. Vs Ajay Pal Singh &
ors.

3. L.I.C. of India Vs Escorts Ltd. & ors.

4. Hindustan Petroleum Corporation Limited &
ors. Vs. Dolly Das

5. Kerala State Electricity Board & ors. Vs Kurien
E. Kalathil & ors.

6. St. of U.P. & ors. Vs Bridge & Roof Co. (India)
Ltd.

7. St. of Guj. & ors. Vs Meghji Pethraj Shah
Charitable Trust & ors.

8. St. of Bih. & ors. Vs Jain Plastics & Chemicals
Ltd.

9. K.K. Saksena Vs International Commission on
Irrigation & Drainage & ors.
10. Election Commission, India Vs Saka Venkata
Subba Rao & ors.

11. R. (Hopley) Vs Liverpool Health Auth.

12. Joshi Technologies International Inc. Vs
U.O.I. & ors.

13. L.I.C. of India & ors. Vs Asha Goel (Smt.) &
anr.

14. M/s Lalloo Ji Rajiv Chandra & Sons Vs
Meladhikari Prayagraj Mela Authority & ors.

15. M/s Ipjacket Technology India Pvt. Ltd. Vs
M.D. Uttar Pradesh Rajkiya Nirman Nigam
Limited

16. M/S Bio Tech System Vs St. of U.P. & 4 ors.

(Delivered by Hon'ble Dr. Yogendra
Kumar Srivastava, J.)

1. Heard Sri Vikrant Pandey, learned
counsel for the petitioner and learned
Standing Counsel appearing for the State
respondents.

2. The present writ petition has been
filed praying for the following reliefs :-

"(i) Issue a writ, order or
direction in the nature of certiorari to call
for record of the case and to quash the
order dated 19.2.2020 passed by the
respondent no.5 by which the payment of
his earlier work has been denied on false
ground that the payment has already been
made (annexure no.1 to the writ petition).

(ii) Issue a writ, order or direction
in the nature of certiorari to call for record
of the case and to quash the order dated
11.2.2020 passed by the respondent no.5 by
which the contract of the petitioner has
been cancelled (annexure no.2 to the writ
petition).

(iii) Issue a writ, order or
direction in the nature of mandamus
2 All. M/s Badri Narayan Shukla Vs. State of U.P. & Ors.
269
directing the respondent no.5 to pay the rest
amount of the work done by the petitioner
immediately.

(iv) Issue a writ, order or direction in
the nature of mandamus directing the
respondents to not to take any coercive action
against the petitioner.

(v) Issue any other and further
suitable writ, order or direction, which this
Hon'ble Court may deem fit and proper in the
circumstances of the case.

(vi) To award of the cost of petition
in favour of the petitioner."

3. The writ petition primarily seeks to
raise a challenge to an order dated 11.2.2020
passed by respondent no.5 whereunder, the
tender of the petitioner was rejected for the
reason that at the time of inspection, the work
was found to be not in accordance with the
prescribed
norms
and
despite
repeated
directions, neither the shortcomings pointed out
were rectified nor was the work completed. The
petitioner has also sought to challenge the
subsequent order dated 19.2.2020 of the
respondent no.5 in terms of which the contract
awarded to the petitioner has been cancelled. A
further prayer has been made raising a claim for
payment of a balance amount stated to be due to
the petitioner in respect of the completed work.

4. The aforementioned reliefs which have
been sought in the present writ petition indicate
that the petitioner seeks to enforce certain
contractual rights and obligations for which the
appropriate remedy is to approach the civil
court or to initiate proceedings for arbitration,
and a writ petition in such matters is, ordinarily,
not to be entertained. It is not the case of the
petitioner that the contract in question was of a
statutory nature; rather it has been clearly
admitted that the contract was a commercial
contract.

5. As per the case set up in the writ
petition, the respondent no.4 had invited tenders
for a civil work and the petitioner being the
lowest bidder, was declared successful and
awarded the contract. The pleadings in the writ
petition and the documents which have been
appended as annexures indicate that there arose
serious dispute with regard to the fact that the
work was not as per the prescribed standards
and that it was not completed within the
scheduled time. There is also a serious dispute
with regard to the amount due and payable to
the petitioner in respect of the work which is
stated to have been completed. The petitioner
claims to have submitted representations from
time to time claiming payment in respect of the
work completed. On the other hand, the
respondents have issued notices to the petitioner
requiring him to complete the work as per the
prescribed standards and within the scheduled
time.

6. The law with regard to the
maintainability of a writ petition in
contractual matters is fairly well settled,
and it has been consistently held that
although there is no absolute bar to the
maintainability of a writ petition in such
matters, the discretionary jurisdiction under
Article 226 of the Constitution of India,
may be refused in case of money claims
arising out of purely contractual obligations
where there are serious disputed questions
of fact with regard to the claims sought to
be raised.

7. The remedy under Article 226 of
the Constitution, has been held, to be
available in a limited sphere only when the
contracting party is able to demonstrate that
the remedy it seeks to invoke is a public
law remedy, in contradistinction to a
private law remedy under a contract.
270 INDIAN LAW REPORTS ALLAHABAD SERIES

8. The legal position in this regard is
that where the rights which are sought to be
agitated are purely of a private character no
mandamus can be claimed, and even if the
relief is sought against the State or any of
its instrumentality the pre-condition for the
issuance of a writ of mandamus is a public
duty. In a dispute based on a pure
contractual relationship there being no
public duty element, a mandamus would
not lie.

9. The question as to whether
jurisdiction of the High Court under Article
226 of the Constitution would be open to
resolve disputes arising out of the contracts
between the State and the citizen was
considered in Radhakrishna Agarwal and
others vs. State of Bihar and others1 and
drawing a distinction with the case of a
contract entered into by the State in
exercise of a statutory power, it was held
that in cases where the contract entered into
between a State and the person aggrieved is
non-statutory and purely contractual and
the rights and liabilities of the parties are
governed by the terms of the contract, and
the petitioner complains about breach of
such contract, the remedy of Article 226
would not be open for such complaints and
no writ or order can be issued under Article
226 in such cases to compel the authorities
to remedy the breach of contract by the
State.

10. The Supreme Court took note of
the three types of cases pertaining to breach
of alleged obligation by the State or its
agents, as referred to in the judgement of
the High Court, against which the appeals
were before it. The three types were stated
as follows :-

"(i) Where a petitioner makes a
grievance of breach of promise on the part
of the State in cases where on assurance or
promise made by the State he has acted to
his prejudice and predicament, but the
agreement is short of a contract within the
meaning of Article 299 of the Constitution;

(ii) Where the contract entered
into between the person aggrieved and the
State is in exercise of a statutory power
under
certain Act
or
Rules
framed
thereunder and the petitioner alleges a
breach on the part of the State; and

(iii) Where the contract entered
into between the State, and the person
aggrieved is non-statutory and purely
contractual and the rights and liabilities of
the parties are governed by the terms of the
contract, and the petitioner complains about
breach of such contract by the State."

11. In respect of cases of the third
category where questions purely of alleged
breach of contract were involved, it was
observed thus :-

"15. It then, very rightly, held that
the cases now before us should be placed in
the third category where questions of pure
alleged breaches of contract are involved. It
held, upon the strength of Umakant Saran
v. The State of Bihar and Lekhraj
Satramdas
v.
Deputy
Custodian-cumManaging Officer and B.K. Sinha v. State
of Bihar that no writ or order can issue
under Article 226 of the Constitution in
such cases "to compel the authorities to
remedy a breach of contract pure and
simple."

xxx

17. Learned counsel contends that
in the cases before us breaches of public
duty are involved. The submission made
before us is that, whenever a State or its
agents or officers deal with the citizen,
either when making a transaction or, after
making it, acting in exercise of powers
2 All. M/s Badri Narayan Shukla Vs. State of U.P. & Ors.
271
under the terms of a contract between the
parties, there is a dealing between the State
and the citizen which involves performance
of "certain legal and public duties." If we
were to accept this very wide proposition
every case of a breach of contract by the
State or its agents or its officers would call
for interference under Article 226 of the
Constitution. We do not consider this to be
a sound proposition at all."

12. We may refer to the judgement of
the Supreme Court in the case of Bareilly
Development Authority and others vs.
Ajay Pal Singh and others2 wherein it
was held that even though the development
authority had the trappings of a State, in a
matter pertaining to determination of the
price of the flats constructed by it and the
rate of monthly instalments to be paid, the
authority after entering into the field of an
ordinary contract was acting purely in its
executive capacity, and the right and
obligations of the parties inter se would be
governed only as per the terms of the
contract. The observations made in the
judgment are as follows:-

"21. This finding in our view is
not correct in the light of the facts and
circumstances of this case because in
Ramana Dayaram Shetty Vs. International
Airport Authority of India [(1979) 3 SCC
489] there was no concluded contract as in
this case. Even conceding that the BDA has
the trappings of a State or would be
comprehended in 'other authority' for the
purpose of Article 12 of the Constitution,
while determining price of the houses/flats
constructed by it and the rate of monthly
instalments to be paid, the 'authority' or its
agent after entering into the field of
ordinary contract acts purely in its
executive capacity. Thereafter the relations
are
no
longer
governed
by
the
constitutional provisions but by the legally
valid contract which determines the rights
and obligations of the parties inter se. In
this sphere, they can only claim rights
conferred upon them by the contract in the
absence of any statutory obligations on the
part of the authority (i.e. BDA in this case)
in the said contractual field.

22. There is a line of decisions
where the contract entered into between the
State and the persons aggrieved is nonstatutory and purely contractual and the
rights are governed only by the terms of the
contract, no writ or order can be issued
under Article 226 of the Constitution of
India so as to compel the authorities to
remedy a breach of contract pure and
simple -- Radhakrishna Agarwal & Ors. v.
State of Bihar (1977) 3 SCC 457, Premji
Bhai Parmar & Ors. v. Delhi Development
Authority & Ors, (1980) 2 SCC 129 and
Divl. Forest Officer v. Bishwanath Tea
Company Ltd. (1981) 3 SCC 238."

13. Reference may also be had to the
judgment in the case of Life Insurance
Corporation of India vs. Escorts Ltd.
and others3 wherein it was held that in a
matter
relating
to
the
contractual
obligations the Court would not ordinarily
examine it unless the action has some
public law character attached to it. The
observations made in the judgment are as
follows:-

"102...If the action of the State is
related
to
contractual
obligations
or
obligations arising out of the tort, the court
may not ordinarily examine it unless the
action has some public law character
attached to it. Broadly speaking, the court
will examine actions of State if they pertain
to the public law domain and refrain from
examining them if they pertain to the
private law field. The difficulty will lie in
272 INDIAN LAW REPORTS ALLAHABAD SERIES
demarcating the frontier between the public
law domain and the private law field. It is
impossible to draw the line with precision
and we do not want to attempt it. The
question must be decided in each case with
reference to the particular action, the
activity in which the State or the
instrumentality of the State is engaged
when performing the action, the public law
or private law character of the action and a
host of other relevant circumstances. When
the State or an instrumentality of the State
ventures into the corporate world and
purchases the shares of a company, it
assumes to itself the ordinary role of a
shareholder, and dons the robes of a
shareholder, with all the rights available to
such a shareholder. There is no reason why
the State as a shareholder should be
expected to state its reasons when it seeks
to change the management, by a resolution
of
the
company,
like
any
other
shareholder."

14. The question of maintainability of a
writ petition under Article 226 in the case of a
money claim again came up for consideration
in the case of Hindustan Petroleum
Corporation Limited and others Vs. Dolly
Das4 and it was held that for invoking the
writ
jurisdiction,
involvement
of
any
constitutional or statutory right was essential
and in the absence of a statutory right, the
remedy under Article 226 could not be
availed to claim any money in respect of
breach of contract, tort or otherwise. It was
reiterated that in absence of any constitutional
or statutory rights being involved, a writ
proceeding would not lie to enforce a
contractual obligation even if it is sought to
be enforced against the State or its
authorities.

15. The maintainability of writ petition
under Article 226 of the Constitution in
disputes relating to terms of contract with a
statutory body fell for consideration in
Kerala State Electricity Board and others
Vs. Kurien E. Kalathil and others5 and it
was held that the writ court would not
ordinarily be the proper forum for resolution
of disputes relating to terms of contract with a
statutory body and disputes arising from
contractual or commercial activities must be
settled according to ordinary principles of law
of contract. The observations made in the
judgement in this regard are as follows :-

"10...The
interpretation
and
implementation of a clause in a contract
cannot be the subject matter of a writ
petition. Whether the contract envisages
actual payment or not is a question of
construction of contract? If a term of a
contract is violated, ordinarily the remedy
is not the writ petition under Article 226.
We are also unable to agree with the
observations of the High Court that the
contractor was seeking enforcement of a
statutory contract. A contract would not
become statutory simply because it is for
construction of a public utility and it has
been awarded by a statutory body. We are
also unable to agree with the observation of
the High Court that since the obligations
imposed by the contract on the contracting
parties come within the purview of the
Contract Act, that would not make the
contract statutory. Clearly, the High Court
fell into an error in coming to the
conclusion that the contract in question was
statutory in nature.

11. A statute may expressly or
impliedly confer power on a statutory body
to enter into contracts in order to enable it
to discharge its functions. Dispute arising
out of the terms of such contracts or alleged
breaches have to be settled by the ordinary
principles of law of contract. The fact that
one of the parties to the agreement is a
2 All. M/s Badri Narayan Shukla Vs. State of U.P. & Ors.
273
statutory or public body will not of itself
affect the principles to be applied. The
disputes about the meaning of a covenant in
a contract or its enforceability have to be
determined
according
to
the
usual
principles of the Contract Act. Every act of
a statutory body need not necessarily
involve an exercise of statutory power.
Statutory bodies, like private parties, have
power to contract or deal with property.
Such activities may not raise any issue of
public law. In the present case, it has not
been shown how the contract is statutory.
The contract between the parties is the
realm of private law. It is not a statutory
contract.
The
disputes
relating
to
interpretation of the terms and conditions
of such a contract could not have been
agitated in a petition under Article 226 of
the Constitution of India. That is a matter
for adjudication by a civil court or in
arbitration if provided for in the contract.
Whether any amount is due and if so, how
much and refusal of the appellant to pay it
is justified or not, are not the matters which
could have been agitated and decided in a
writ petition."

16. Considering the maintainability of
a writ petition under Article 226 of the
Constitution in the context of a dispute
relating to terms of a private contract where
a mandamus was sought seeking to restrain
authorities from making any deduction
from bills in terms of the contract, it was
held in State Of U.P. and others vs Bridge
& Roof Co. (India) Ltd6 that proper
course would be to refer the matter to
arbitration or institution of a suit and not
filing of a writ petition. It was observed
thus :-

"15. In our opinion, the very
remedy adopted by the respondent is
misconceived. It is not entitled to any relief
in these proceedings,i.e, in the writ petition
filed by it. The High court appears to be
right in not pronouncing upon any of the
several contentions raised in the writ
petition by both the parties and in merely
reiterating the effect of the order of the
Deputy Commissioner made under the
proviso to section 8-D (1).

16. Firstly, the contract between
the parties is a contract in the realm of
private law. It is not a statutory contract. It
is governed by the provisions of the
contract Act or, maybe, also by certain
provisions of the Sale of Goods Act. Any
dispute relating to interpretation of the
terms and conditions of such a contract
cannot be agitated, and could not have been
agitated,in a writ petition. That is a matter
either for arbitration as provided by the
contract or for the civil court, as the case
may be. Whether any amount is due to the
respondent from the appellant-Government
under the contract and, if so, how much and
the further question whether retention or
refusal to pay any amount by the
Government is justified, or not, are all
matters which cannot be agitated in or
adjudicated upon in a writ petition. The
prayer in the writ petition,viz.,to restrain
the Government from deducting particular
amount from the writ petitioner's bill(s)
was not a prayer which could be granted by
the High Court under Article 226. Indeed,
the High Court has not granted the said
prayer.

17. Secondly, whether there has
been a reduction in the statutory liability on
account of a change in law within the
meaning of sub-clause (4) of clause 70 of
the contract is again not a matter to be
agitated in the writ petition. That is again a
matter relating to interpretation of a term of
the contract and should be agitated before
the arbitrator or the civil court, as the case
maybe. If any amount is wrongly withheld
274 INDIAN LAW REPORTS ALLAHABAD SERIES
by the Government,the remedy of the
respondent is to raise a dispute as provided
by the contract or to approach the civil
court, as the case may be, according to law.
Similarly if the Government says that any
over- payment has been made to the
respondent, its remedy also is the same.

18. Accordingly, it must be held
that the writ petition filed by the respondent
for the issuance of a writ of mandamus
restraining the Government from deducting
or withholding a particular sum, which
according to the respondent is payable to it
under
the
contract,
was
wholly
misconceived and was not maintainable in
law (See the decision of this Court in
Assistant Excise Commissioner v. Isaac
Peter (1994 (4) S.C.C.104), where the law
on the subject has been discussed fully.)
The writ petition ought to have been
dismissed on this ground alone.

xxx

21.
There
is
yet
another
substantial reason for not entertaining the
writ petition. The contract in question
contains a clause providing inter a1ia for
settlement of disputes by reference to
arbitration (Clause 67 of the contract). The
Arbitrators can decide both questions of
fact as well as questions of law. When the
contract itself provides for a mode of
settlement of disputes arising from the
contract, there is no reason why the parties
should not follow and adopt that remedy
and invoke the extra-ordinary jurisdiction
of the High Court under Article 226. The
existence of an effective alternative remedy
- in this case, provided in the contract itself
- is a good ground for the court to decline
to exercise its extraordinary jurisdiction
under Article 226. The said article was not
meant to supplant the existing remedies at
law but only to supplement them in certain
well-recognised situations. As pointed out
above, the prayer for issuance of a writ of
mandamus was wholly misconceived in
this case since the respondent was not
seeking to enforce any statutory right of
theirs nor was it seeking to enforce any
statutory
obligation
cast
upon
the
appellants. Indeed, the very resort to Article
226 - whether for issuance of mandamus or
any other writ, order or direction - was
misconceived for the reasons mentioned
supra."

17. The maintainability of a writ
petition in a case where termination of an
agreement between the private parties and
the State Government was challenged
under Article 226 of the Constitution came
up for consideration in State Of Gujarat
and others vs Meghji Pethraj Shah
Charitable Trust and others7 and it was
stated that as the matter was governed by a
contract between the parties, the writ
petition was not maintainable since it was a
public law remedy and was not available in
private law field i.e. where the matter is
governed by a non-statutory contract. The
observations made in the judgement in this
regard are as follows :-

"22. We are unable to see any
substance
in
the
argument
that
the
termination
of
arrangement
without
observing the principle of natural justice
(audi
alteram
partem)
is
void. The
termination is not a quasi-judicial act by
any stretch of imagination; hence it was not
necessary to observe the principles of
natural justice. It is not also an executive or
administrative act to attract the duty to act
fairly. It was - as has been repeatedly urged
by Sri Ramaswamy - a matter governed by
a contract/agreement between the parties. If
the matter is governed by a contract, the
writ petition is not maintainable since it is a
public law remedy and is not available in
private law field, e.g., where the matter is
2 All. M/s Badri Narayan Shukla Vs. State of U.P. & Ors.
275
governed by a non-statutory contract. Be
that as it may, in view of our opinion on the
main question, it is not necessary to pursue
this reasoning further."

18. In the case of State of Bihar and
others vs. Jain Plastics & Chemicals
Ltd.8 a grievance was sought to be raised
against deduction of an amount from the
final bill to be paid to the contractor due to
breach of contract by him. The petition was
allowed by the High Court. The matter was
taken to the Supreme Court wherein it was
held that even if it was possible to decide
the question raised in the petition on the
basis of affidavits and counter affidavits, it
would
not
be
proper
to
exercise
extraordinary jurisdiction under Article 226
of the Constitution in cases of alleged
breach of contract. The observations made
by the Supreme Court are as follows:-

"2. Limited question involved in
this appeal is -- whether the High Court
ought not to have exercised its jurisdiction
under Article 226 of the Constitution of
India for granting relief in case of alleged
breach of contract.

3. Settled law -- writ is not the
remedy
for
enforcing
contractual
obligations. It is to be reiterated that writ
petition under Article 226 is not the proper
proceedings for adjudicating such disputes.
Under the law, it was open to the
respondent to approach the court of
competent jurisdiction for appropriate relief
for breach of contract...

x x x

7...It is true that many matters
could be decided after referring to the
contentions raised in the affidavits and
counter-affidavits, but that would hardly be
a ground for exercise of extraordinary
jurisdiction under Article 226 of the
Constitution in case of alleged breach of
contract. Whether the alleged non-supply of
road permits by the appellants would
justify breach of contract by the respondent
would depend upon facts and evidence and
is not required to be decided or dealt with
in a writ petition. Such seriously disputed
questions or rival claims of the parties with
regard to breach of contract are to be
investigated and determined on the basis of
evidence which may be led by the parties in
a properly instituted civil suit rather than by
a court exercising prerogative of issuing
writs."

19. Distinguishing private law from
public law, it was held in K.K.Saksena vs.
International Commission on Irrigation
and Drainage and others9 that private law
obligations of the State or public authorities
are not amenable to writ jurisdiction. The
relevant
observations
made
in
the
judgement are as follows :-

"43. What follows from a minute
and careful reading of the aforesaid
judgments of this Court is that if a person
or authority is "State" within the meaning
of Article 12 of the Constitution, admittedly
a writ petition under Article 226 would lie
against such a person or body. However, we
may add that even in such cases writ would
not lie to enforce private law rights. There
are catena of judgments on this aspect and
it is not necessary to refer to those
judgments as that is the basic principle of
judicial review of an action under the
administrative law. The reason is obvious.
A private law is that part of a legal system
which is a part of common law that
involves relationships between individuals,
such as law of contract or torts. Therefore,
even if writ petition would be maintainable
against an authority, which is "State" under
Article 12 of the Constitution, before
issuing any writ, particularly writ of
276 INDIAN LAW REPORTS ALLAHABAD SERIES
mandamus, the Court has to satisfy that
action of such an authority, which is
challenged, is in the domain of public law
as distinguished from private law.

44. Within a couple of years of
the framing of the Constitution, this Court
remarked in Election Commission of
India
v.
Saka
Venkata
Rao
that
administrative law in India has been shaped
in the English mould. Power to issue writ
or any order of direction for "any other
purpose" has been held to be included in
Article 226 of the Constitution with a view
apparently to place all the High Courts in
this country in somewhat the same position
as the Court of the King's Bench in
England. It is for this reason ordinary
"private law remedies" are not enforceable
through extraordinary writ jurisdiction,
even
though
brought
against
public
authorities (see Administrative Law, 8th
Edition; H.W.R. Wade & C.F. Forsyth, page
656). In a number of decisions, this Court
has held that contractual and commercial
obligations
are
enforceable
only
by
ordinary action and not by judicial review."

20. The Constitution Bench Judgement
in the case of Election Commission, India
vs. Saka Venkata Subba Rao and others10
and the judgement in the case of R.(Hopley)
vs. Liverpool Health Authority11, were
referred to for the proposition that contractual
and commercial obligations are enforceable
only by ordinary action and not by judicial
review. It was stated thus :-

"50. We have also pointed out
above that in Saka Venkata Rao this Court
had observed that administrative law in India
has been shaped on the lines of English law.
There are a catena of judgments in English
courts taking same view, namely, contractual
and commercial obligations are enforceable
only by ordinary action and not by judicial
review. In R. (Hopley) v. Liverpool Health
Authority (unreported) (30.7.2002), Justice
Pitchford helpfully set out three things that
had to be identified when considering
whether a public body with statutory powers
was exercising a public function amenable to
judicial review or a private function. They
are: (i) whether the defendant was a public
body
exercising
statutory
powers;
(ii)
whether the function being performed in the
exercise of those powers was a public or a
private one; and (iii) whether the defendant
was performing a public duty owed to the
claimant in the particular circumstances
under consideration."

21. The nature of the prerogative
remedy of a mandatory order as the normal
means for enforcing performance of public
duties by public authorities has been
considered in Administrative Law by
H.W.R. Wade & C.F. Forsyth12, and a
distinction has been drawn between public
duties enforceable by a mandatory order,
which are usually statutory, and duties arising
merely from contract. It has been stated thus
:-

"A distinction which needs to be
clarified is that between public duties
enforceable by a mandatory order, which
are usually statutory, and duties arising
merely from contract. Contractual duties
are enforceable as matters of private law by
the ordinary contractual remedies, such as
damages, injunction, specific performance
and declaration. They are not enforceable
by a mandatory order, which in the first
place is confined to public duties and
secondly is not granted where there are
other adequate remedies."

22. We may also gainfully refer to the
judgment in the case of Joshi Technologies
International Inc. vs. Union of India and
2 All. M/s Badri Narayan Shukla Vs. State of U.P. & Ors.
277
others13 wherein the legal position in this
regard has been taken note of and
summarized in the following terms:-

"69.
The
position
thus
summarised in the aforesaid principles has
to be understood in the context of
discussion that preceded which we have
pointed out above. As per this, no doubt,
there
is
no
absolute
bar
to
the
maintainability of the writ petition even in
contractual matters or where there are
disputed questions of fact or even when
monetary claim is raised. At the same time,
discretion lies with the High Court which
under certain circumstances, it can refuse to
exercise. It also follows that under the
following circumstances, "normally", the
Court would not exercise such a discretion:

69.1. The Court may not examine
the issue unless the action has some public
law character attached to it.

69.2. Whenever a particular mode
of settlement of dispute is provided in the
contract, the High Court would refuse to
exercise its discretion under Article 226 of
the Constitution and relegate the party to
the said mode of settlement, particularly
when settlement of disputes is to be
resorted
to
through
the
means
of
arbitration.

69.3. If there are very serious
disputed questions of fact which are of
complex nature and require oral evidence
for their determination.

69.4. Money claims per se
particularly arising out of contractual
obligations
are
normally
not
to
be
entertained
except
in
exceptional
circumstances.

70. Further, the legal position
which emerges from various judgments of
this
Court
dealing
with
different
situations/aspects
relating
to
contracts
entered into by the State/public authority
with private parties, can be summarised as
under:

70.1. At the stage of entering into
a contract, the State acts purely in its
executive capacity and is bound by the
obligations of fairness.

70.2. State in its executive
capacity, even in the contractual field, is
under obligation to act fairly and cannot
practise some discriminations.

70.3.
Even
in
cases
where
question is of choice or consideration of
competing claims before entering into the
field of contract, facts have to be
investigated and found before the question
of a violation of Article 14 of the
Constitution could arise. If those facts are
disputed
and
require
assessment
of
evidence the correctness of which can only
be tested satisfactorily by taking detailed
evidence, involving examination and crossexamination of witnesses, the case could
not
be
conveniently
or
satisfactorily
decided in proceedings under Article 226 of
the Constitution. In such cases the Court
can direct the aggrieved party to resort to
alternate remedy of civil suit, etc.

70.4. Writ jurisdiction of the High
Court under Article 226 of the Constitution
was not intended to facilitate avoidance of
obligation voluntarily incurred.

70.5. Writ petition was not
maintainable
to
avoid
contractual
obligation.
Occurrence
of
commercial
difficulty, inconvenience or hardship in
performance of the conditions agreed to in
the contract can provide no justification in
not complying with the terms of contract
which the parties had accepted with open
eyes. It cannot ever be that a licensee can
work out the licence if he finds it profitable
to do so: and he can challenge the
conditions under which he agreed to take
the licence, if he finds it commercially
inexpedient to conduct his business.
278 INDIAN LAW REPORTS ALLAHABAD SERIES

70.6. Ordinarily, where a breach
of contract is complained of, the party
complaining of such breach may sue for
specific performance of the contract, if
contract is capable of being specifically
performed. Otherwise, the party may sue
for damages.

70.7. Writ can be issued where
there is executive action unsupported by
law or even in respect of a corporation
there is denial of equality before law or
equal protection of law or if it can be
shown that action of the public authorities
was without giving any hearing and
violation of principles of natural justice
after holding that action could not have
been taken without observing principles of
natural justice.

70.8. If the contract between
private party and the State/instrumentality
and/or agency of the State is under the
realm of a private law and there is no
element of public law, the normal course
for the aggrieved party, is to invoke the
remedies provided under ordinary civil law
rather than approaching the High Court
under Article 226 of the Constitution of
India
and
invoking
its
extraordinary
jurisdiction.

70.9. The distinction between
public law and private law element in the
contract with the State is getting blurred.
However, it has not been totally obliterated
and where the matter falls purely in private
field of contract, this Court has maintained
the position that writ petition is not
maintainable. The dichotomy between
public law and private law rights and
remedies would depend on the factual
matrix of each case and the distinction
between the public law remedies and
private law field, cannot be demarcated
with precision. In fact, each case has to be
examined, on its facts whether the
contractual relations between the parties
bear insignia of public element.