# M/S Prema Construction v. Assistant Commissioner, Central Excise and Service Tax & Ors - **Citation:** (2016) 8 ILRA 291 - **Court:** High Court of Judicature at Allahabad - **Decided:** 2016-08-24 - **Bench:** Sudhir Agarwal, Kaushal Jayendra Thaker - **Source:** https://unisonlegal.in/judgment/allahabad-high-court/m-s-prema-construction-v-assistant-commissioner-central-excise-and-service-tax-44246 - **Pages:** 5 ## Text 8 All. M/S Prema Construction Vs Assistant Commissioner, Central Excise and Service Tax & Ors. 291 (2016) 8 ILRA 291 ORIGINAL JURISDICTION CIVIL SIDE DATED: ALLAHABAD 24.08.2016 BEFORE THE HON'BLE SUDHIR AGARWAL, J. THE HON'BLE KAUSHAL JAYENDRA THAKER, J. Writ Tax No.- 563 Of 2013 M/S Prema Construction ...Petitioner Versus Assistant Commissioner, Central Excise and Service Tax & Ors. ...Respondents Counsel for Petitioner: Rakesh Kumar Srivastava, S.D. Singh, Ashish Agarwal Counsel for Respondents: R.K. Shukla, Sr. S.C., P.K. Tripathi, R.C.Shukla Held A writ petition under Article 226 is not maintainable for recovery of money arising out of contractual obligations. Disputes relating to: Interpretation of contract, Payment under contract, Alleged breach of contract, fall within the domain of private law and must be adjudicated through: Civil suit, or Arbitration (if provided in contract). Mere involvement of a statutory body does not convert a contract into a statutory contract. In absence of a statutory right, relief under Article 226 cannot be invoked for contractual claims. A writ seeking payment under a contract is essentially a money decree, which cannot be granted in writ jurisdiction. Questions such as: Whether any amount is due, Whether payment was justified or not, require evidence and adjudication, unsuitable for writ jurisdiction. The proper remedy lies in ordinary civil proceedings, not writ jurisdiction. The writ petition is devoid of merit and dismissed. CASE LAW CITED A writ petition under Article 226 is not maintainable for recovery of money arising out of contractual obligations. Disputes relating to: Interpretation of contract, 292 INDIAN LAW REPORTS ALLAHABAD SERIES Payment under contract, Alleged breach of contract, fall within the domain of private law and must be adjudicated through: Civil suit, or Arbitration (if provided in contract). Mere involvement of a statutory body does not convert a contract into a statutory contract. In absence of a statutory right, relief under Article 226 cannot be invoked for contractual claims. A writ seeking payment under a contract is essentially a money decree, which cannot be granted in writ jurisdiction. Questions such as: Whether any amount is due, Whether payment was justified or not, require evidence and adjudication, unsuitable for writ jurisdiction. The proper remedy lies in ordinary civil proceedings, not writ jurisdiction. The writ petition is devoid of merit and dismissed. (Delivered by Hon'ble Sudhir Agarwal, J. & Hon'ble Kaushal Jayendra Thaker, J.) 1. Heard Sri Ashish Agarwal, learned counsel for petitioner and Sri P.K. Tripathi, Advocate, for respondents. 2. Sri Ashish Agarwal, learned counsel for petitioner, at the outset, stated that Prayer (i) has rendered infructuous by efflux of time. 3. With respect to Prayer (ii), he could not dispute that it relates to recovery of certain money from U.P. Rajya Vidyut Utpadan Nigam Limited based on contractual matter for which remedy lies in common law and for that purpose no writ petition lie since in absence of any statutory right, Article 226 cannot be availed to claim any money in respect of breach of contract or tort or otherwise. 4. In Kerala State Electricity Board and another Vs. Kurien E. Kalathil and others 2000 (6) SCC 293, Court said that interpretation and implementation of a clause in a contract cannot be subject-matter of a writ petition. Whether a contract envisages actual payment or not is a question of construction of contract. If a term of contract is violated, ordinarily remedy is not the writ petition under Article 226. 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. A statute may 8 All. M/S Prema Construction Vs Assistant Commissioner, Central Excise and Service Tax & Ors. 293 expressly or impliedly confer power on a statutory body to enter into contracts in order to enable it to discharge its functions. Disputes 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 statutory or public body will not by 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 have power to contract or deal with property like private parties. Such activities may not raise any issue of public law. When it is not shown that contract is statutory and parties are within the realm of their authority, contract between the parties is in the realm of private law. The disputes relating to interpretation of terms and conditions of such contract cannot be agitated in a petition under Article 226 of the Constitution. The Court further said: "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." 5. Following the above authorities, a Division Bench of this Court in M/S Prabhu Construction Company through its Proprietor Vs. State of U.P. and another (Writ C No. 25075 of 2014) decided on 05.05.2014 said as under: "In the present case, there is nothing on the record which may persuade us to hold that the contract is a statutory contract. The remedy of the contractor, if he is aggrieved by nonpayment, would be to either file an ordinary civil suit or if there is an arbitration agreement between the parties, to invoke the terms of the agreement." 6. The Court also relied on its earlier decision in M/s R.S. Associate Vs. State of U.P. and others (Writ-C No. 11544 of 2014) decided on 24.02.2014. 7. Again in Alaska Tech Vs. State of U.P. 2014 (6) ADJ 591, a Division Bench of this Court observed as under: "2. We are of the view that, in a matter of this nature which pertains to alleged nonpayment of dues under a contract for supply of goods, it would neither be prudent nor judicious for this Court, in exercise of its jurisdiction under Article 226 of the Constitution, to grant relief, which is in substance, is a prayer for a money decree. These matters, it must be emphasized, are not those relating to statutory contracts but are purely non-statutory contracts. Whether work has been satisfactorily performed, whether the rates which had been quoted are in accordance with the terms of the contract, whether the goods were of a quality as mandated, and above all, whether the claim is within limitation or otherwise, are issues which cannot appropriately be adjudicated upon under Article 226 of the Constitution." 294 INDIAN LAW REPORTS ALLAHABAD SERIES 8. The same view has been reiterated in M/S Goyal Stationary Mart through its Proprietor State of U.P. (Misc. Bench No. 10971 of 2015) decided on 27.11.2015, Budh Gramin Sansthan Vs. State of U.P. 2014 (7) ADJ 29, Kaka Advertising Agency Vs. U.P. Technical University and others 2014 (11) ADJ 227, M/s A.K. Constructions Vs. State of U.P. and others (Misc. Bench No. 1909 of 2014) decided on 07.03.2014, Major Travels through Proprietor Vs. State of U.P. and others (Misc. Bench No. 3472 of 2014) decided on 25.04.2014 and Uttaranchal Paper Converters and Publishers through Proprietor Vs. State of U.P. and others (Misc. Bench No. 3898 of 2015) decided on 13.05.2014. 9. In view thereof, we are clearly of the view so far as Prayer (ii), mandamus sought by petitioner is nothing but grant of a money decree in extraordinary equitable jurisdiction under Article 226 which ought not to have been granted. We, therefore, find not reason to interfere. 10. The writ petition lacks merits. Dismissed. 11. Interim order, if any, stands vacated. ------------ 8 All. LG Electronics India Pvt. Ltd. Vs The Principal Commissioner Of Income Tax 295 (2016) 8 ILRA 295 ORIGINAL JURISDICTION CIVIL SIDE DATED: ALLAHABAD 03.08.2016 BEFORE THE HON'BLE SUDHIR AGARWAL, J. THE HON'BLE DR. KAUSHAL JAYENDRA THAKER, J. Writ Tax No.- 575 Of 2016 LG Electronics India Pvt. Ltd. ...Petitioner Versus The Principal Commissioner Of Income Tax ...Respondent Counsel for Petitioner: Suyash Agarwal, Rupesh Jain, Gaurav Jain Counsel for Respondent: C.S.C., Gaurav Mahajan This writ petition under Article 226 of the Constitution has been filed by LG Electronics India Pvt. Ltd. aggrieved by notice dated 08.06.2016 issued by Principal Commissioner of Income Tax, NOIDA, Gautambudh Nagar in exercise of power under Section 263 of Income Tax Act, 1961 in respect of Assessment Year 2007- ¬08. The only issue raised and pressed before this court is, "whether impugned notice is barred by limitation prescribed under Section 263(2) of Act, 1961 or not". Limitation prescribed under Section 263(2) for exercise power under sub¬section (1) thereof is two years from the end of financial year in which order sought to be revised was passed. Learned counsel for the petitioner submitted that for the purpose of Section 263(1) limitation will commence from the end of financial year when order dated 31.10.2011 was passed and that comes to 31.03.2012 and two years period would elapsed on 31.03.2014. Court held that that impugned notice dated 08.06.2016 issued by Principal Commissioner of Income Tax, NOIDA, Gautambudh Nagar is in reference to some discrepancy in original assessment order dated 31.10.2011 and not re¬assessment order dated 26.03.2015, therefore, limitation would run from the date of regular order of assessment and in that view of the matter, impugned notice, evidently is barred by limitation prescribed under Section 263(2) of Act, 1961. The writ petition is allowed. (Delivered by Hon'ble Sudhir Agarwal, J. & Hon'ble Dr. Kaushal Jayendra Thaker, J.)