M/S Chicago Constructions International Private Limited v. Kerala Water Authority and connected cases

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN** **TUESDAY, THE 19[TH] DAY OF DECEMBER 2023 / 28TH AGRAHAYANA, 1945** ## **WP(C) NO. 42645 OF 2023** ## **PETITIONER:** M/S. CHICAGO CONSTRUCTIONS INTERNATIONAL PRIVATE LIMITED, REPRESENTED BY ITS MANAGING DIRECTOR, S.MOHANA KUMAR, AGED 60 YEARS, SON OF SADASIVAN, HAVING ITS REGISTERED OFFICE AT TC 22/2703, CHITIRA LANE, KOCHAR ROAD, SASTHAMANGALAM, THIRUVANANTHAPURAM, PIN - 695010 N.KRISHNA PRASAD P.SHANES METHAR A.MOHAMMED FAIZAL BHARATH MOHAN GEETHU SUSAN VARGHESE DEEPAK VARUGHESE MATHEW JAISHRI SHEBA JACOB PUSHPARAJ.K.P ## **RESPONDENTS:** 1 KERALA WATER AUTHORITY, REPRESENTED BY ITS MANAGING DIRECTOR, JALA BHAVAN, OBSERVATORY HILLS, VELLAYAMBALAM, THIRUVANANTHAPURAM, PIN - 695033 2 THE SUPERINTENDING ENGINEER, PUBLIC HEALTH CIRCLE, KOTTAYAM, COLLECTORATE PO, PIN - 686002 3 THE EXECUTIVE OFFICER, PROJECT DIVISION, KERALA WATER AUTHORITY, COLLECTORATE P.O, KOTTAYAM, PIN - 686002 4 THE KERALA CONSTRUCTION WORKERS WELFARE FUND BOARD REP. BY ITS CHAIRMAN, NIRMAL BHAVAN, METTUKKADA, THAYCAUD POST, THIRUVANANTHAPURAM, PIN – 695014 SRI.P.M.JOHNY -SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 19.12.2023, ALONG WITH WP(C).42656/2023 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 42645 OF 2023 & con.cases 2 # **IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT** **THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN** **TUESDAY, THE 19[TH] DAY OF DECEMBER 2023 / 28TH AGRAHAYANA,** **1945** ## **WP(C) NO. 42656 OF 2023** ## **PETITIONER:** M/S. CHICAGO CONSTRUCTIONS INTERNATIONAL PRIVATE LIMITED, REPRESENTED BY ITS MANAGING DIRECTOR, S.MOHANA KUMAR, AGED 60 YEARS, SON OF SADASIVAN, HAVING ITS REGISTERED OFFICE AT TC 22/2703, CHITIRA LANE, KOCHAR ROAD, SASTHAMANGALAM, THIRUVANANTHAPURAM, PIN - 695010 N.KRISHNA PRASAD BHARATH MOHAN P.SHANES METHAR A.MOHAMMED FAIZAL DEEPAK VARUGHESE MATHEW GEETHU SUSAN VARGHESE PUSHPARAJ.K.P JAISHRI SHEBA JACOB ## **RESPONDENTS:** 1 KERALA WATER AUTHORITY, REPRESENTED BY ITS MANAGING DIRECTOR, JALA BHAVAN, OBSERVATORY HILLS, VELLAYAMBALAM, THIRUVANANTHAPURAM, PIN - 695033 2 THE SUPERINTENDING ENGINEER, KERALA WATER AUTHORITY, PUBLIC HEALTH CIRCLE, KOLLAM - 691001 3 THE EXECUTIVE ENGINEER, KERALA WATER AUTHORITY, PROJECT DIVISION, KOLLAM, PIN - 691001 4 THE KERALA CONSTRUCTION WORKERS WELFARE FUND BOARD REP. BY ITS CHAIRMAN, NIRMAL BHAVAN, METTUKKADA, THAYCAUD POST, THIRUVANANTHAPURAM., PIN – 695014 WP(C) NO. 42645 OF 2023 & con.cases 3 ## SRI.P.M.JOHNY -SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 19.12.2023, ALONG WITH WP(C).42645/2023 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 42645 OF 2023 & con.cases 4 # **IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT** **THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN TUESDAY, THE 19[TH] DAY OF DECEMBER 2023 / 28TH AGRAHAYANA,** **1945** ## **WP(C) NO. 42671 OF 2023** ## **PETITIONER:** M/S. CHICAGO CONSTRUCTIONS INTERNATIONAL PRIVATE LIMITED, REPRESENTED BY ITS MANAGING DIRECTOR, S.MOHANA KUMAR, AGED 60 YEARS, SON OF SADASIVAN, HAVING ITS REGISTERED OFFICE AT TC 22/2703, CHITIRA LANE, KOCHAR ROAD, SASTHAMANGALAM, THIRUVANANTHAPURAM, PIN - 695010 N.KRISHNA PRASAD A.MOHAMMED FAIZAL P.SHANES METHAR DEEPAK VARUGHESE MATHEW GEETHU SUSAN VARGHESE PUSHPARAJ.K.P BHARATH MOHAN JAISHRI SHEBA JACOB ## **RESPONDENTS:** 1 KERALA WATER AUTHORITY, REPRESENTED BY ITS MANAGING DIRECTOR, JALA BHAVAN, OBSERVATORY HILLS, VELLAYAMBALAM, THIRUVANANTHAPURAM, PIN - 695033 2 THE SUPERINTENDING ENGINEER KERALA WATER AUTHORITY, PUBLIC HEALTH CIRCLE, THIRUVANANTHAPURAM, PIN - 695033 3 THE EXECUTIVE ENGINEER PROJECT DIVISION, KERALA WATER AUTHORITY, THIRUVANANTHAPURAM, PIN - 695033 4 THE KERALA CONSTRUCTION WORKERS WELFARE FUND BOARD REP. BY ITS CHAIRMAN, NIRMAL BHAVAN, METTUKKADA, WP(C) NO. 42645 OF 2023 & con.cases 5 THAYCAUD POST, THIRUVANANTHAPURAM, PIN – 695014 SRI.P.M.JOHNY -SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 19.12.2023, ALONG WITH WP(C).42645/2023 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 42645 OF 2023 & con.cases 6 # **IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT** **THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN TUESDAY, THE 19[TH] DAY OF DECEMBER 2023 / 28TH AGRAHAYANA,** **1945** ## **WP(C) NO. 42694 OF 2023** ## **PETITIONER:** M/S. CHICAGO CONSTRUCTIONS INTERNATIONAL PRIVATE LIMITED, REPRESENTED BY ITS MANAGING DIRECTOR, S.MOHANA KUMAR, AGED 60 YEARS, SON OF SADASIVAN, HAVING ITS REGISTERED OFFICE AT TC 22/2703, CHITIRA LANE, KOCHAR ROAD, SASTHAMANGALAM, THIRUVANANTHAPURAM, PIN - 695010 N.KRISHNA PRASAD P.SHANES METHAR A.MOHAMMED FAIZAL GEETHU SUSAN VARGHESE JAISHRI SHEBA JACOB DEEPAK VARUGHESE MATHEW BHARATH MOHAN PUSHPARAJ.K.P ## **RESPONDENTS:** 1 KERALA WATER AUTHORITY, REPRESENTED BY ITS MANAGING DIRECTOR, JALA BHAVAN, OBSERVATORY HILLS, VELLAYAMBALAM, THIRUVANANTHAPURAM, PIN - 695033 2 THE SUPERINTENDING ENGINEER, OFFICE OF THE THE SUPERINTENDING ENGINEER, PUBLIC HEALTH CIRCLE, KERALA WATER AUTHORITY, JALA BHAVAN, OBSERVATORY HILLS, VELLAYAMBALAM, THIRUVANANTHAPURAM, PIN - 695033 3 THE EXECUTIVE ENGINEER, OFFICE OF THE EXECUTIVE ENGINEER, PROJECT DIVISION, KERALA WATER AUTHORITY, JALA BHAVAN, VELLAYAMABLAM, THIRUVANANTHAPURAM – 695033 WP(C) NO. 42645 OF 2023 & con.cases 7 4 THE KERALA CONSTRUCTION WORKERS WELFARE FUND BOARD REP. BY ITS CHAIRMAN, NIRMAL BHAVAN, METTUKKADA, THAYCAUD POST, THIRUVANANTHAPURAM, PIN – 695014 SRI.P.M.JOHNY -SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 19.12.2023, ALONG WITH WP(C).42645/2023 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 42645 OF 2023 & con.cases 8 ## **JUDGMENT** ## **[WP(C) Nos.42645/2023, 42656/2023, 42671/2023, 42694/2023]** The petitioner in these matters – which have been heard together on account of the analogous facts and circumstances presented and similarity of the reliefs sought – is stated to be Works Contractors, engaged by the Kerala Water Authority (KWA). 2. The specific case of the petitioner is that they have been contracted with the ‘KWA’ only to supply materials for pipeline works being carried on by them; and that they have no connection with such construction work, or its allied performance. They argue that, obviously, therefore, no “Cess” under the Kerala Construction Workers Welfare Fund Act, could have been imposed against them, since the contracts entered into by them have no relation to the construction work at all, or to the construction workers. 3. The petitioner says that, however, in spite of this, 1% of their bill amount is sought to be now deducted towards “Cess” under the “KCWWF”; and consequently, that they have been constrained to approach this Court, through this writ petition. They assert that their contentions are supported by the WP(C) NO. 42645 OF 2023 & con.cases 9 judgments of this Court in Poulose and others v. State of Kerala and others [1993 (3) ILR Kerala 675] and Kerala Construction WWF Board v. State of Kerala [1995(2) KLT 724]. 4. Sri.P.M.Johny – learned Standing Counsel for the ‘KWA’, however, in response to the afore submissions of Sri.P.Shanes Methar – learned counsel for the petitioner, argued that, since the petitioner is a contractor under the ‘KWA’, their obligation to pay “Cess” under the “KCWWF” is unmistakable and unavoidable. He argued that, as long as the petitioner is involved in construction works, they certainly have to pay “Cess” and they cannot refuse it in any manner whatsoever. 5. It is luculent from the afore rival positions that there is factual disputation as to the nature of the contracts entered into by the petitioner with the ‘KWA’. While they maintain that they are to only supply materials, without having any participation in the actual construction work; the ‘KWA’ appears to take the stand that, even the supply of materials is part of the construction work. 6. However, it must be borne in mind that “KCWWF” Scheme has a particular ambit to it and its purlieus are also well defined. It is only if all the criteria thereunder are satisfied, will WP(C) NO. 42645 OF 2023 & con.cases 10 the obligation of a contractor to pay “Cess” thereunder be attracted. In the case at hand, as I have already said above, it is the specific contention of the petitioner that they only supply materials and have no part in the construction work. If this be so, certainly, it is a matter which the Superintendent or such other competent Authority of ‘KWA’ must consider, before imposing “Cess” upon them, through an automatic deduction from their bills. 7. When there is a clear factual dispute as afore, it would not be proper for one of the contracting parties unilaterally to impose a detriment on the other, citing that they are liable to pay “Cess”, without even making an assessment of the same and without affording them an opportunity of being heard. 8. In the afore circumstances, I allow these writ petitions and set aside impugned proceedings and direct the competent Authority of the ‘KWA’ to hear the petitioner and assess their claim, that they are not liable to pay “Cess” under the “KCWWF” Act because, they only supply materials and not concerned with the construction work. 9. The afore shall be done, after affording each of the petitioner an opportunity of being heard and after assessing their WP(C) NO. 42645 OF 2023 & con.cases 11 contentions and the germane documentary materials; thus culminating in an appropriate order and necessary action thereon, as expeditiously as is possible. This shall be done also adverting specifically to the declarations in the afore cited precedents. 10. Needless to say, until such time as the afore is done and the resultant orders communicated to the petitioner, action to recover any amount from their Bill amounts towards “Cess” under the “KCWWF Act”, will stand deferred; and will be taken forward only after the said orders are communicated to them and in terms of the decisions will be arrived at. As a corollary, if, through the afore exercise, it is to be found that “Cess” under the “KCWWF Act” cannot be improved against the petitioner, then the amounts already collected from them under such head will be returned without any avoidable delay. ## **Sd/- DEVAN RAMACHANDRAN** ## **JUDGE** stu WP(C) NO. 42645 OF 2023 & con.cases 12 ## **APPENDIX OF WP(C) 42656/2023** PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE RELEVANT EXTRACT OF THE NOTICE INVITING TENDER (VOLUME NO.1) Exhibit P2 TRUE COPY OF THE SELECTION NOTICE DATED 10/03/2020 - Exhibit P3 TRUE COPY OF THE AGREEMENT NO. 32/201920/SE/Q DATED 17.03.2020 BETWEEN THE PETITIONER AND THE SECOND RESPONDENT - Exhibit P4 TRUE COPY OF THE ACCEPTED SCHEDULE FOR THE WORK - Exhibit P5 TRUE COPY OF THE CB-3 VOUCHER DATED 27/01/2021 REPRESENTING THE FIRST PART BILL - Exhibit P6 TRUE COPY OF THE CB-3 VOUCHER DATED 27/02/2021 REPRESENTING THE SECOND PART BILL - Exhibit P7 TRUE COPY OF THE CB-3 VOUCHER DATED 27.02.2021 REPRESENTING THE THIRD PART BILL - Exhibit P8 TRUE COPY OF THE CB-3 VOUCHER DATED 20.12.2021 - Exhibit P9 TRUE COPY OF THE CB-3 VOUCHER DATED 23.03.2022 Exhibit P10 TRUE COPY OF THE CB3 VOUCHER DATED 02.07.2022 - Exhibit P11 TRUE COPY OF THE CB-3 VOUCHER DATED 27/03/2023 - Exhibit P12 TRUE COPY OF THE CB-3 VOUCHER DATED 13/11/2023 - Exhibit P13 TRUE COPY OF THE APPROVED PAYMENT BREAK UP IN RESPECT OF THE WORK WP(C) NO. 42645 OF 2023 & con.cases 13 Exhibit P14 TRUE COPY OF THE COMMUNICATION OF THE PETITIONER ADDRESSED TO THE SECOND RESPONDENT DATED 13.12.2023 Exhibit P15 TRUE COPY OF THE SAID JUDGMENT DATED 04.12.2023 IN WRIT PETITION (CIVIL) NO. 39649/2023 AND CONNECTED CASES WP(C) NO. 42645 OF 2023 & con.cases 14 ## **APPENDIX OF WP(C) 42671/2023** PETITIONER EXHIBITS - Exhibit P1 TRUE COPY OF THE RELEVANT EXTRACT OF THE NOTICE INVITING TENDER (VOLUME 1) - Exhibit P2 TRUE COPY OF THE SELECTION NOTICE DATED 1/10/2022 ISSUED BY THE 2ND RESPONDENT - Exhibit P3 TRUE COPY OF THE AGREEMENT NO.103/2022-23 DATED 3/11/20222 - Exhibit P4 TRUE COPY OF THE ACCEPTED SCHEDULE ALONG WITH THE DETAILED SCHEDULE - Exhibit P5 TRUE COPY OF THE PAYMENT BREAKUP IN RESPECT OF THE WORK AWARDED TO THE PETITIONER PURSUANT TO EXHIBIT-P1 - Exhibit P6 TRUE COPY OF THE CB-3 VOUCHER DATED 20/01/2023 - Exhibit P7 TRUE COPY OF THE CB-3 VOUCHER DATEDM11/7/2023 - Exhibit P8 TRUE COPY OF THE CB-3 VOUCHER DATED 19/8/2023 - Exhibit P9 TRUE COPY OF THE CB-3 VOUCHER DATED 23/11/2023 - Exhibit P10 TRUE COPY OF THE SAID JUDGMENTDATED 04.12.2023 IN WRIT PETITION (CIVIL) NO. 39649/2023 AND CONNECTED CASES I - Exhibit P11 TRUE COPY OF THE REPRESENTATION OF THE PETITIONER DATED 14/12/2023 SUBMITTED BEFORE THE 2ND RESPONDENT WP(C) NO. 42645 OF 2023 & con.cases 15 ## **APPENDIX OF WP(C) 42694/2023** PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE RELEVANT EXTRACT OF THE NOTICE INVITING TENDER E-TENDER NO.122/202021/KWA/PHC/D2/TVM/RT1 (VOLUMENO.1) Exhibit P2 TRUE COPY OF THE SELECTION NOTICE DATED 10.09.2021 ISSUED BY THE 2ND RESPONDENT - Exhibit P3 TRUE COPY OF THE AGREEMENT NO. 07/2021-22 DATED 20.09.2021 WITH THE SECOND RESPONDENT - Exhibit P4 TRUE COPY OF THE ACCEPTED SCHEDULE FOR THE WORK Exhibit P5 TRUE COPY OF THE CB-3 VOUCHER DATED 11.03.2022 Exhibit P6 TRUE COPY OF THE CB-3 VOUCHER DATED 30.05.2022 Exhibit P7 TRUE COPY OF THE CB-3 VOUCHER DATED 15.09.2022 Exhibit P8 TRUE COPY OF THE CB-3 VOUCHER DATED 07.01.2023 Exhibit P9 TRUE COPY OF THE CB-3 VOUCHER DATED 18.04.2023 Exhibit P10 TRUE COPY OF THE CB-3 VOUCHER DATED 11.08.2023 Exhibit P11 TRUE COPY OF THE COMMUNICATION DATED 23.12.2021 ISSUED BY THE SECOND RESPONDENT ALONG WITH THE APPROVED BREAK UP Exhibit P12 TRUE COPY OF THE COMMUNICATION OF THE PETITIONER ADDRESSED TO THE SECOND RESPONDENT DATED 13.12.2023 Exhibit P13 TRUE COPY OF THE JUDGMENT DATED 04.12.2023 IN WRIT PETITION (CIVIL) NO. 39649/2023 AND CONNECTED CASES WP(C) NO. 42645 OF 2023 & con.cases 16 ## **APPENDIX OF WP(C) 42645/2023** PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE RELEVANT EXTRACTS OF VOLUME NO.1 OF THE NOTICE INVITING TENDER Exhibit P2 TRUE COPY OF SELECTION NOTICE DATED 22.07.2020 - Exhibit P3 TRUE COPY OF THE ACCEPTED PRICE SCHEDULE - Exhibit P4 TRUE COPY OF THE AGREEMENT NO.03/SE/PHCK/2020-21 DATED 17.08.2020 BETWEEN THE PETITIONER AND THE SECOND RESPONDENT Exhibit P4(A) TRUE COPY OF THE SUPPLEMENTAL AGREEMENT DATED 26.03.2022 - Exhibit P5 TRUE COPY OF THE APPROVED BREAK UP OF PAYMENTS IN RESPECT OF THE WORK - Exhibit P6 TRUE COPY OF THE CB-3 VOUCHER DATED NIL FOR THE NET AMOUNT OF RS.2,84,33,002/- - Exhibit P7 TRUE COPY OF THE CB-3 VOUCHER DATED NIL FOR AN AMOUNT OF RS.2,29,600.59/- Exhibit P8 TRUE COPY OF THE CB-3 VOUCHER DATED 27.10.2021 - Exhibit P9 TRUE OPY OF THE CB-3 VOUCHER DATED 13.4.2021 Exhibit P10 TRUE COPY OF THE CB-3 VOUCHER DATED 30.8.2022 Exhibit P11 TRUE COPY OF THE CB-3 VOUCHER DATED 29.7.2023 Exhibit P12 TRUE COPY OF THE REPRESENTATION OF THE PETITIONER DATED 14.12.2023 WP(C) NO. 42645 OF 2023 & con.cases 17 Exhibit P13 TRUE COPY OF THE JUDGMENT OF THIS HON'BLE COURT DATED 4.12.2023 IN WP© NO.39649/2023 AND CONNECTED CASES