KERALA STATE CASHEW DEVELOPMENT CORPORATION LTD. v SURICE TRADING PET LTD & SRI K.S. BHARATHAN

W.A.No. 32/2016 : 1 : IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR & THE HONOURABLE MR. JUSTICE SHAJI P.CHALY WEDNESDAY, THE 30[TH] DAY OF JUNE 2021 / 9TH ASHADHA, 1943 WA NO. 32 OF 2016 JUDGMENT DATED 25.02.2015 IN WPC 27272/2009 OF HIGH COURT OF KERALA, ## ERNAKULAM ## APPELLANT/PETITIONER IN THE W.P.(C): - 1 KERALA STATE CASHEW DEVELOPMENT CORPN. LTD., CASHEW HOUSE, PB.NO.13, KOLLAM 691 001, REPRESENTED BY ITS MANAGING DIRECTOR. 2 THE MANAGING DIRECTOR, KERALA STATE CASHEW DEVELOPMENT CORPN. LTD., CASHEW HOUSE, PB.NO.13, KOLLAM 691 001. BY ADVS. C.UNNIKRISHNAN (KOLLAM) SRI.VIPIN P.VARGHESE, SC, KERALA STATE CASHEW DEVELOPMENT CORPORATION LTD. ## RESPONDENTS/RESPONDENTS IN THE W.P(C): M/S. SURICE TRADING PET LTD. 101 CECIL STREET, 11-09,TONG ENG BUILDING,, SINGAPORE069533, A COMPANY INCORPORATED IN, SINGAPORE, REP.BY ITS AGENT, BHADRESH MEHTA,PARTNER, M/S.BHADRESH TRADING CORPN,205,MAJESTIC SHOPPING, CENTRE,144 JSS ROAD, GIRAGUM, MUMBAI 400 004. SRI. K.S.BHARATHAN THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 30.06.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.A.No. 32/2016 : 2 : ## **Dated this the 30[th] day of June, 2021.** ## **JUDGMENT** ## **SHAJI P. CHALY, J.** This appeal is filed by the respondents in W.P.(C) No. 27272 of 2009, challenging the legality and correctness of the judgment of the learned single Judge dated 25.02.2015, whereby the writ petition was allowed directing the appellants to make payment of an amount of US$2,93,129.20 to the writ petitioner at the earliest possible time and at any rate within a period of 3 months from the date of receipt of a copy of the judgment. 2. Material facts for the disposal of the writ appeal are as follows: The writ petitioner secured a tender floated by the Kerala State — Cashew Development Corporation Ltd. first appellant for the supply of 3,500 MTs of dried raw cashew nuts for which Ext. P2 contract was executed. A subsequent contract was also entered into for the import of 4000 MTs of raw cashew, evident from Ext. P3. As per the terms of the contract, 90% of the value of the goods already supplied were paid to the writ petitioner. The balance 10% was retained in accordance with the terms of the contract, which was agreed to be paid on receipt of certificates of approved surveyor nominated by the first appellant W.A.No. 32/2016 : 3 : Corporation at the Ports concerned. 3. It was the contention of the writ petitioner that a sum of US$4,51,383.77 was remaining payable from the appellant Corporation and having not paid, he has raised a claim through Ext. P4 lawyer notice. However, in Ext. P5 reply, the Corporation informed that they have incurred heavy loss due to fall in the price of Kernel in the international market and under such circumstances, the Board of Directors of the Corporation had taken a decision to settle the matter with respect to the undrawn balance due on imports made during the year 2000. 4. Other similar objections were raised in the matter of payment of the claims raised by the writ petitioner. Anyhow, having not received the payment, the writ petitioner approached this Court by filing O.P. No. 8157 of 2002 seeking a direction to the first respondent to effect payment of US$4,51,383.77 within a time frame to be fixed by the court. Further directions were also sought in the writ petition in terms of the admissions made in Ext. P5 reply notice that the writ petitioner is entitled to get the amount of US$7,946.51, and it was disposed of as per Ext. P6 judgment observing that there is no dispute about the amount payable and also holding that there is no reason as to why the writ petitioner is not paid the value of goods purchased. Anyhow, directions were issued to the Corporation to make payment W.A.No. 32/2016 : 4 : due in two instalments, the first of which would be paid within one month and the balance amount within two months thereafter. It was further observed that since the writ petitioner was getting payment without any dispute being raised by the Corporation, the writ petitioner undertakes to accept payment with 4% interest and leaving open the liberty of the writ petitioner to claim higher rate of interest, if default is made beyond the time stipulated. 5. Anyhow, the appellants have filed a review petition against Ext. P6 judgment, which was disposed of as per Ext. P7 order clarifying that the direction in the judgment to make payment was that of the admitted amount and leaving open the liberty of the Corporation to issue proceedings declining payment, if according to the Corporation the amount claimed was not payable. However, the review petition was dismissed observing that the direction was only to make payment of the admitted amount and there is no scope for review. The matter was taken up in appeal by the appellants by filing W.A. No. 941 of 2004 before a learned Division Bench of this Court, in which as per Ext. P8 interim order the respondents were directed to make payment of an amount of Rs.25,00,000/- within one month. The said order was challenged before the Apex Court and in Ext. P9 order, the Apex Court granted relaxation of time stipulated for payment of the said amount. Anyhow it was paid subsequently. Later, the writ appeal was W.A.No. 32/2016 : 5 : withdrawn by filing a memo by the counsel appearing, as is evident from Ext. P10 judgment. 6. Anyhow, the remaining amounts were not paid. Therefore, a contempt petition was filed contending that the directions contained in the judgment in O.P No. 8157 of 2002 was not complied with, but the said contempt case was disposed of as per Ext. P17 judgment making it clear that in Ext. P6 judgment, it was not stated by the court as to the amount payable by the appellant Corporation to the writ petitioner, leaving open the liberty of the writ petitioner to claim whatever balance amount due from the appellant Corporation. Following the same, writ petitioner has caused to issue Ext. P11 lawyer notice claiming payment of balance amount, which was responded to by the appellant Corporation through Ext. P12 reply stating that the matter is entrusted with their legal advisor and a reply would be sent within a period of two weeks. According to the writ petitioner, as per Ext. P13 proceedings, the Managing Director namely the second appellant issued proceedings dated 02.08.2004 admitting the liability for payment of the balance amount of 10% and the undrawn balance due is calculated at US$2,93,129.20. 7. But, fact remains, the said amount was also not paid. It was accordingly that the writ petition leading to the present appeal was filed contending that non payment of the admitted amount on the W.A.No. 32/2016 : 6 : basis of Exts. P2 and P3 contracts are arbitrary, illegal and unjustified and sought for a direction to make payment of US$3,94,014.71 as was claimed in Ext. P11 lawyer notice. Taking into consideration the entire aspects of the matter and the documents produced, the learned single Judge relied upon Exts. P14 and P15 affidavits filed by the appellants in the earlier writ appeal and pointing out that in Ext. P15, the appellant Corporation had admitted that as per the accounts maintained by the Corporation, the amount due to the writ petitioner is US$2,93,129.20. Therefore, the contention advanced was that since there is a clear admission on the part of the appellants, they cannot retract from the admission made in the affidavit in a proceeding filed before this Court. 8. The paramount contention advanced by the appellants was that the latest writ petition was barred by _res judicata,_ since the respondents have claimed the entire amount in the earlier writ proceedings, which was not granted by this Court , which amounts to declining the relief sought for and thereby, the principles of constructive _res judicata_ applies. Whatever that be, after going through the decisions rendered by the Apex Court in various of its judgments, the learned single Judge had arrived at the conclusion that in view of the nature of reliefs sought for in the latest writ petition, the principles of _res judicata_ would not come into play and W.A.No. 32/2016 : 7 : therefore, the appellant Corporation is liable to pay the amount admitted in Exts. P13 and P15 to the writ petitioner. The relevant portion of the judgment reads thus: 10. Further, question arises as to whether a writ petition can be maintained for relief which is in the nature of executing an earlier judgment. Settled legal precedents are to the effect that constitutional courts exercising powers under Article 226 are not precluded from issuing any further directions in achieving fulfillment of its earlier judgments/orders. In the case at hand it is evident that a Contempt of Court case filed by the petitioner was not proceeded observing that there was no direction for payment of any specific amount contained in Ext.P6 judgment. Now the petitioner is agitating the cause based on the admissions contained in Exts.P13 and P15. Therefore this court is of the opinion that there is no bar to entertain this writ petition, because it is more or less in the nature of seeking execution of an earlier judgment. Hence the petitioner need not be relegated to the remedy of civil suit. 11. But there remains a crucial question as to whether there is any clear admission on the part of the respondents with respect to the liability, as contained in Exts.P13 and P15 documents. Ext.P13 is a proceeding issued by the 2nd respondent after Ext.P6 judgment, during pendency of Writ Appeal No.941/2004. The relevant portion contained in Ext.P13 is extracted below:“As per assurance given by the party, the corporation is entitled W.A.No. 32/2016 : 8 : to discount for the balance 6319.808 MT of raw nuts. Towards discount, which the corporation is entitled for the remaining quantity of 6319.808 MT, an amount of USD1,57,995.20 (6,319.808 x USD . 25) is to be deducted for the undrawn balance of USD 4,51,124.40 (which was computed without giving credit to the discount) initially calculated and the undrawn balance due is only as USD.2,93,129.20. Considering the huge loss sustained by the corporation under the contract with the party the corporation feels that the discount now granted by the party is very meager. The corporation therefore decided to negotiate with the party for further discount/reduction”. 12. While evaluating the above statement it is evident that there is a clear admission that after all deductions there is an undrawn balance due to the extent of US$ 2,93,129.20. But the Corporation contended that they have decided to have further negotiation for more discount/reduction. In Ext.P15 also, which is an affidavit filed by the 2 nd respondent in Writ Appeal No.941/2004 before the Division Bench, it is stated as follows:- “In this connection it may be kindly be noted as per the accounts maintained by the Corporation, it is revealed that after the reduction of US$ 25/MT, the amount due to the respondent is only US$2,93,129.20”. 13. It is mentioned that the Corporation had suffered huge loss due to steep decline in the price of kernels in the international market, and that the Corporation had invited the respondents for negotiation for further reduction on the amount. From Ext.P6 judgment it is evident that while disposing the writ petition the Corporation had submitted that the claim of the petitioner need W.A.No. 32/2016 : 9 : to be verified with reference to the Books of Accounts of the respondents. It is on that basis the writ petition was disposed of by directing the Corporation to make the payment of amounts due, in 2 instalments. It is true that the judgment was subsequently clarified stating that, what was directed is only payment of admitted amounts. Going by the contens of Exts.P13 and P15 extracted above it is evident that the Corporation had admitted that the amounts due as per the Books of Accounts, is a sum of US$2,93,129.20. Therefore merely because the Corporation had stated that they are intending to have further negotiations it cannot be accepted that the above said amount is not the admitted amount as per the Books of Accounts, in view of the directions contained in Ext.P16 judgment which remained clarified subsequently, which is binding on the respondent Corporation. It cannot be said that the Corporation is not liable for payment of the said amount. As the relief claimed in this writ petition is limited only to extent of payment of the admitted amounts, this court finds no justification to deny such claim. The contentions with respect to principles of res judicata or the availability of remedy under general law will not preclude this court from granting such relief, is the considered opinion. 14. Under the above mentioned circumstances, this writ petition is allowed to the limited extent directing the respondents to make payment of the amount of US$2,93,129.20 to the petitioner Company, at the earliest possible. At any rate payment in this regard shall be made within a period of three months from the date of receipt of a copy of the judgment.” W.A.No. 32/2016 : 10 : 9. We have heard the learned counsel appeared for the appellant Sri. Vipin P. Varghese and Sri. K.S. Bharathan appeared for the respondents, and perused the pleadings and materials on record. 10. The paramount contention advanced by the learned counsel for the appellants is that the claims raised in the latest writ petition is barred by _res judicata_ . The said issue was considered by the learned single Judge at length, taking into account the judgment of the Apex Court in _**Nagindas Ramdas v Dalapatram Ichharam alias Brijram**_ _**And others**_ [(1974) 1 SCC 242] relied upon by the writ petitioner and the judgments of the Apex Court relied upon by the respondents. It is also seen that a contention was raised that no writ petition is maintainable with respect to the commercial transactions. However, the learned single Judge found that since the contracts entered into by and between the parties and the terms and conditions contained thereunder are admitted and since the amount due is also admitted on the basis of the statement of accounts and the affidavit filed before this Court, the appellants are not entitled to resile from the same and contend otherwise. The question of _res judicata_ would not come into play at all, since in the Judgment in the initial writ petition, directions were issued to consider the payment of admitted amounts to the writ petitioner, and in the review filed by the Corporation it was clarified so, which proceedings were challenged in appeal by the corporation before W.A.No. 32/2016 : 11 : a Division Bench and later it was withdrawn. Above all, consequent to the payment of a part amount and admissions made in the affidavit filed before the learned Division Bench in appeal, a fresh cause of action arose enabling the writ petitioner to make a claim. Therefore, the learned single judge was right in holding that the technical rule of _res judicata_ would not apply. 11. Anyhow, there is no material dispute with respect to the amount remaining in the books of account maintained by the appellant Corporation that the amount due is US$2,93,129.20, which was also supported by the contents of Exts. P13 and P15. Since the said amount due is undisputed, it is well settled and trite that directions could be issued by writ court to pay the amount, if there is arbitrary and illegal act on the part of the debtor to pay the money. As we have pointed out earlier and deliberated above, the learned single Judge has relied upon the statement of accounts and crucial and relevant documents to arrive at the conclusion that the appellant Corporation is liable to make the payment. So also, we find that the quality and the quantity of the cashew were never disputed in any of the earlier proceedings, and mere dispute raised in this appeal for the sake of disputing the factual circumstances cannot be sustained in law . 12. On appreciating the facts, circumstances and the legal implications raised, we are of the considered opinion that the W.A.No. 32/2016 : 12 : appellants have not made out any case for interference in an intra court appeal filed under Section 5 of the Kerala High Court Act, 1958, there being no jurisdictional error or other legal infirmities justifying us to do so. Resultantly, writ appeal fails and accordingly, it is dismissed. However, at that point of time, the learned counsel for the appellants sought time for making payment of the amount directed to be paid to the writ petitioner. Taking into account the present Covid-19 pandemic situation and other difficulties pointed out by the counsel, we deem it fit to grant two months' time to pay the amount as directed by the learned single Judge with a further rider that if the amount is not paid within the time stipulated as specified above, the appellant Corporation would be liable to pay interest at the rate of 8% from the date of this judgment for the entire amount directed to be paid. sd/- **S. MANIKUMAR, CHIEF JUSTICE.** sd/- **SHAJI P. CHALY, JUDGE.** _Rv_