Essco Furnaces Pvt. Ltd. v. District Panchayat Palakkad and Executive Engineer, Local Self Government Department, District Panchayath Office, Palakkad

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR. JUSTICE T.R.RAVI** **MONDAY, THE 9[TH] DAY OF AUGUST 2021 / 18TH SRAVANA, 1943 WP(C) NO. 20897 OF 2020** ## **PETITIONER:** **ESSCO FURNACES PVT. LTD** **D.P.NO.230 AND 231,8TH CROSS STREET, 8TH MAIN ROAD,SIDCO INDUSTRIAL ESTATE, THIRUMUDIVAKKAM,CHENNAI-600044, REPRESENTED BY POWER OF ATTORNEY HOLDER RANJITH E.C, AGED 32 YEARS, S/O CHANDRASEKHARAN, RESIDING AT PARAMPARAMBATH HOUSE,AZAD ROAD, KALOOR,COCHIN,KERALA-682025.** **BY ADVS. A.BALAGOPALAN SRI.A.RAJAGOPALAN SRI.M.N.MANMADAN SRI.M.S.IMTHIYAZ AHAMMED SMT.P.SEENA** ## **RESPONDENTS:** **1 THE DISTRICT PANCHAYAT REPRESENTED BY ITS SECRETARY, DISTRICT PANCHAYATH OFFICE,PALAKKAD-678001. 2 EXECUTIVE ENGINEER, LOCAL SELF GOVERNMENT DEPARTMENT, DISTRICT PANCHAYATH OFFICE,PALAKKAD-678001.** **BY ADVS. SRI.P.K.NIJOY GOVERNMENT PLEADER SMT. RASHMI. K. M., GOVERNMENT PLEADER** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 3.8.2021, THE COURT ON 09.08.2021 DELIVERED THE FOLLOWING:** W.P.(C)No.20897 of 2020 :-2-: Dated this the 9[th] day of August, 2021 ## **J U D G M E N T** The 1[st] Respondent invited quotations for supply and erection of gas furnaces in several panchayats in Palakkad District. The petitioner company submitted tenders. By Exhibit P2 letter dated 20.2.2019, the petitioner's quotation for Rs.17,55,000/- for each furnace was accepted and the petitioner was directed to enter into an agreement with regard to erecting the furnaces in three panchayats. Thereafter, on 7.8.2019, the petitioner was awarded similar work for four more panchayats. Regarding the work awarded as per Exhibit P2, an agreement was entered into on 23.7.2019 as can be seen from Exhibit P5. The work was to be completed in 6 months after the site is handed over. The work awarded as per Exhibit P5 was also to be completed within a period of 6 months. Going by the dates on which the work was awarded, the work should have been completed by February, 2020. 2. It would appear from the averments in the Writ petition that the petitioner had a grievance that the necessary infrastructure was W.P.(C)No.20897 of 2020 :-3-: not available at the site, to facilitate the installation of the gas furnaces. Exhibits P9 to P12 indicate such grievances. Even though there had been several communications between the parties, the fact remains that out of the work entrusted in seven Panchayats, the petitioner completed the work in one Panchayat alone. It is the petitioner's case that a detailed representation was placed before the Respondents explaining the reasons for the delay. As the main reason being the outbreak of the Covid19 pandemic, it is requested that the petitioner may not be penalised for the delay and may be granted an extension of another 3 months for completion of the work. However, by Exhibit P23 and P27 orders dated 11.8.2020, the 2[nd] Respondent terminated the contract to the petitioner at his risk and cost and forfeited the security amounts deposited by the petitioner towards the loss sustained by the department. The petitioner has approached this Court being aggrieved by the orders of termination of the contract. 3. Heard Sri A.Balagopalan, the counsel for the petitioner, Smt. Rashmi K.V., Government Pleader on behalf of the 2[nd] respondent and Sri Nijoy P.K., the counsel for the 1[st] respondent District Panchayat. W.P.(C)No.20897 of 2020 :-4-: 4. The contention of the counsel for the petitioner is that Exhibits P23 and P27 orders were issued without considering the difficulties that the petitioner faced due to the lockdown and the spread of Covid 19 pandemic. According to the petitioner, the Respondents ought to have extended the term for completion of the contract in the peculiar circumstances through which the country is going through and not terminated the contract. It is further submitted that the Respondents failed to consider the fact that despite all the difficulties, the petitioner had completed the work regarding one panchayat. The 2[nd] Respondent has filed a counter affidavit, wherein it is stated that the work involved was the construction of gas crematorium and that the civil work was already over and all that was to be done by the petitioner was the installation of the gas furnace. It is stated that the work was awarded to the petitioner, after invitation of open tenders from the panel of competent agencies approved by the Suchitwa Mission. It is submitted that the work was entrusted much before the Covid 19 pandemic and as such the request for extension of time on the reason of the spread of the Covid 19 cannot be countenanced. It was further submitted that the petitioner is already W.P.(C)No.20897 of 2020 :-5-: removed from the list of approved agencies of the Suchitwa Mission and as such there is no question of getting the work done through them. It is further submitted that only one work out of seven works entrusted was completed by the petitioner and the one which was completed was also defective and that since the work of erection of the gas crematorium is a work which is required to be completed in a time frame, particularly since the pandemic is causing severe loss of life, the Respondents cannot be expected to wait indefinitely for the petitioner to complete the job. The counsel appearing for the 1[st] Respondent panchayat submitted that the issue involved is purely contractual nature and does not contain any public law element. The right that is put forward is against the termination of contract, for the reason of breach, which is essentially a question which is to be decided in a civil suit and not under Article 226 of the Constitution of India. 5. I find considerable force in the contentions put forward by the Respondents. The issue involved is purely contractual and it is well settled that in such matters unless there is a public law element involved, this Court would not exercise its extraordinary jurisdiction W.P.(C)No.20897 of 2020 :-6-: under Article 226 of the Constitution of India. In **Joshi Technologies International Inc. v. Union of India,** reported in **(2015) 7 SCC 728** the Hon'ble Supreme Court held that 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. Any interference by this Court would only amount to rewriting the contract between the parties. In such circumstances, this Writ petition is dismissed without prejudice to the right of the petitioner to approach the appropriate civil Court for redressal of his grievance regarding the termination of the contract on risk and cost. There will be no orders as to costs. All pending interlocutory applications are closed. Sd/- **T.R.RAVI, JUDGE** ami/ W.P.(C)No.20897 of 2020 :-7-: ## **APPENDIX OF WP(C) 20897/2020** ## **PETITIONER EXHIBITS** **EXHIBIT P1** **TRUE COPY OF THE SPECIFIC POWER OF ATTORNEY DATED 14.09.2020 AUTHORIZING MR.RANJITH E.C. TO REPRESENT THE PETITIONER.** **EXHIBIT P2 TRUE COPY OF THE LETTER BEARING NO.D1/WORKS/2018-19 DATED 20.02.2019 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER** - **EXHIBIT P3 TRUE COPY OF THE BANK GUARANTEE NO.30171GISS190017 DATED 23.07.2019 FOR AN AMOUNT OF RS.1,31,625 IN FAVOUR OF THE ASSISTANT EXECUTIVE ENGINEER ON BEHALF OF THE PETITIONER** - **EXHIBIT P4 TRUE COPY OF THE FIXED DEPOSIT CERTIFICATE BEARING NO.290761 DATED 23.07.2019 ISSUED BY THE TREASURY SAVINGS BANK,DISTRIC TREASURY,PALAKKAD FOR AN AMOUNT OF RS.1,31,700 PLEDGED TO ASSISTANT EXECUTIVE ENGINEER** - **EXHIBIT P5 TRUE COPY OF THE LETTER NO.D1-255/19 DATED 23.07.2019 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER** - **EXHIBIT P6 TRUE COPY OF THE LETTER NO.D1/WORKS/1819 DATED 7.08.2019 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER** **EXHIBIT P7 TRUE COPY OF THE BANK GUARANTEE NO.30171G1SS190019 DATED 20.08.2019 FOR AN AMOUNT OF RS.1,70,000 IN FAVOUR OF THE ASSISTANT EXECUTIVE ENGINEER ON BEHALF OF THE PETITIONER** ## W.P.(C)No.20897 of 2020 :-8-: |**EXHIBIT P8**|**TRUE COPY OF THE FIXED DEPOSIT**| |---|---| ||**CERTIFICATE BEARING NO.290976 DATED**| ||**19.08.2019 ISSUED BY THE TREASURY**| ||**SAVINGS BANK,DISTRICT TREASURY,PALAKKAD**| ||**FOR AN AMOUNT OF RS.1,70,000 PLEDGED TO**| ||**ASSISTANT EXECUTIVE ENGINEER**| |**EXHIBIT P9**|**TRUE COPY OF THE LETTER**| ||**NO.EF/RR/KKGP/19006-3 DATED 9.10.2019 TO**| ||**THE ASSISTANT ENGINEER,KULAKKALLUR GRAMA**| ||**PANCHAYATH TO PROVIDE CERTAIN ITEMS AT**| ||**THE SITE FOR INSTALLATION OF GAS FURNACE**| |**EXHIBIT P10**|**TRUE COPY OF THE LETTER**| ||**NO.EF/RR/TKGP/19006-4 DATED 9.10.2019 TO**| ||**THE ASSISTANT ENGINEER,THIRUMITTAKODE**| ||**GRAMA PANCHAYATH TO PROVIDE**| ||**INFRASTRUCTURE AT THE SITE FOR THE**| ||**INSTALLATION OF GAS FURNACE**| |**EXHIBIT P11**|**TRUE COPY OF THE LETTER**| ||**NO.EF/RR/KGP/19006-2 DATED 10.10.2019 TO**| ||**THE SECRETARY,KANAMBRA GRAMA PANCHAYATH**| ||**TO ARRANGE NECESSARY INFRASTRUCTURE AT**| ||**THE SITE**| |**EXHIBIT P12**|**TRUE COPY OF THE LETTER**| ||**NO.EF/RR/KLGP/19006-2 DATED 10.10.2019**| ||**TO THE SECRETARY,KOLLENGODE GRAMA**| ||**PANCHAYATH TO ARRANGE NECESSARY**| ||**INFRASTRUCTURE AT THE SITE**| |**EXHIBIT P13**|**TRUE COPY OF THE LETTER BEARING**| ||**NO.EF/RR/PKD/19006-3/2019-1 DATED**| ||**12.11.2019 TO THE 2ND RESPONDENT**| |**EXHIBIT P14**|**TRUE COPY OF THE LETTER BEARING**| ||**NO.EF/RR/PKD/19006-3/2019-2 DATED**| ||**12.11.2019 TO THE 2ND RESPONDENT**| |**EXHIBIT P15**|**TRUE COPY OF THE LETTER BEARING**| ||**NO.EF/RR/TKGP/19006-4 DATED 27.11.2019**| ||**TO THE 2ND RESPONDENT**| W.P.(C)No.20897 of 2020 :-9-: |**EXHIBIT P16**|**TRUE COPY OF THE LETTER BEARING**| |---|---| ||**NO.EF/RR/TKGP/19006-3 DATED 27.11.2019**| ||**TO THE 2ND RESPONDENT**| |**EXHIBIT P17**|**TRUE COPY OF THE LETTER BEARING**| ||**NO.EF/RR/PKD/19006-9 DATED 24.02.2020 TO**| ||**THE 2ND RESPONDENT**| |**EXHIBIT P18**|**TRUE COPY OF THE LETTER BEARING**| ||**NO.EF/RR/PKD/19006-9 DATED 24.02.2020 TO**| ||**THE 2ND RESPONDENT**| |**EXHIBIT P19**|**TRUE COPY OF THE LETTER NO.D1/255/18-19**| ||**DATED 26.02.2020 FROM THE 2ND RESPONDENT**| ||**TO THE PETITIONER**| |**EXHIBIT P20**|**TRUE COPY OF THE LETTER**| ||**NO.EF/RR/PKD/19006-10 DATED 04.05.2020**| ||**TO THE 2ND RESPONDENT.**| |**EXHIBIT P21**|**TRUE COPY OF THE LETTER**| ||**NO.EF/RR/PKD/19006-11 DATED 04.05.2020**| ||**TO THE 2ND RESPONDENT.**| |**EXHIBIT P22**|**TRUE COPY OF THE LETTER**| ||**NO.EF/RR/PKD/19006-18 DATED 08.08.2020**| ||**TO THE 2ND RESPONDENT.**| |**EXHIBIT P23**|**TRUE COPY OF THE ORDER NO.D1/WORKS/18-19**| ||**DATED 11.08.2020 PASSED BY THE 2ND**| ||**RESPONDENT**| |**EXHIBIT P24**|**TRUE COPY OF THE LETTER BEARING**| ||**NO.D1/255/20-21 DATED 11.08.2020 ISSUED**| ||**BY THE 2ND RESPONDENT**| |**EXHIBIT P25**|**TRUE COPY OF THE LETTER BEARING**| ||**NO.EF/RR/PKD/19006-19 DATED 25.08.2020**| ||**ISSUED TO THE 2ND RESPONDENT**| |**EXHIBIT P26**|**TRUE COPY OF THE LETTER BEARING**| ||**NO.EF/RR/PKD/19006-18 DATED 27.08.2020**| ||**ISSUED TO THE 2ND RESPONDENT.**| |**EXHIBIT P27**|**THE TRUE COPY OF THE ORDER NO.**| ||**D1/WORKS/18-19 DATED 11.08.2020 PASSED**| ||**BY THE 2ND RESPONDENT.**| W.P.(C)No.20897 of 2020 :-10-: |**EXHIBIT P28**|**THE CERTIFICATE OF TESTIMONY BEARING**| |---|---| ||**NO.B1-4731/2020 DATED 5.3.2021 ISSUED BY**| ||**THE THENKURISSI GRAMA PANCHAYATH**| |**EXHIBIT P29**|**LETTER BEARING NO.DB-1940/GEN/KZM/20**| ||**DATED 10.3.2021 ISSUED BY THE ASSISTANT**| ||**EXECUTIVE ENGINEER TO THE 2ND RESPONDENT**|