IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 1st DAY OF AUGUST 2019 BEFORE THE HON’BLE MR. JUSTICE ALOK ARADHE WRIT PETITION NO.5462 OF 2018 (GM-TEN) BETWEEN:
ABDUL RAHIMAN S/O. HAJI K MOIDU AGED ABOUT 53 YEARS R/AT DARUL AMAN KANNANAGAR, HEJAMADI UDUPI-574 103. … PETITIONER (BY MR. REUBEN JACOB, ADV.) AND:
1. GOVERNMENT OF KARNATAKA PUBLIC WORKS, PORTS & INLAND WATER TRANSPORT DEPARTMENT VIKASA SOUDHA, BENGALURU-560 001 REPRESENTED BY ITS SECRETARY 2. CHIEF ENGINEER STATE HIGHWAY DEVELOPMENT PROJECT PROJECT IMPLEMENTATION UNIT GROUND FLOOR, PWD ANNEX BUILDING K R CIRCLE, BENGALURU-560 001.
3. KARNATAKA ROAD DEVELOPMENT CORPORATION LIMITED REGISTERED OFFICE AT: 1ST FLOOR, #16/J, THIMMAIAH ROAD CROSS, MILLER TANK BED AREA THIMMAIAH ROAD CROSS, VASANTHANAGAR BENGALURU-560 0052. REPRESENTED BY ITS MANAGING DIRECTOR. ...RESPONDENTS (BY MR. MANU.K, ADV. FOR MR. AJAY J. NANDALIKE, ADV. FOR R3;
MR. SRIDHAR.N. HEGDE, HCGP FOR R1 & R2) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE LETTER DATED 22.07.2018 WRITTEN BY R-3 VIDE ANNEX-N, AND ETC.
THIS PETITION COMING ON FOR PRELIMINARY HARING IN ‘B’ GROUP THIS DAY, THE COURT MADE THE FOLLOWING:-
ORDER Sri.Reuben Jacob, learned counsel for the petitioner.
Sri.Manu.K, learned counsel for Sri.Ajay J.Nandalike, learned counsel for the Respondent No.3.
Sri.Sridhar N.Hegde, learned High Court Government Pleader for Respondents 1 and 2.
2. The petition is admitted for hearing. With consent of the learned counsel for the parties, the same is heard finally.
3. In this petition under Article 226 of the Constitution of India, the petitioner inter alia seeks a writ of certiorari for quashment of communication dated 22.01.2018 sent by Respondent No.2 to recover the amount allegedly due and payable from the petitioner for another contractor, which is subsisting with the Respondent No.2.
4. Facts giving raise to the filing of this petition briefly stated are that the petitioner is a Class-I Contractor registered with Public Works Department, Government of Karnataka. Respondent No.3 is Karnataka Road Development Corporation, a company functioning under the Public Works Department and in relation to Water Transport Department. Under an agreement dated 16.12.2005, Respondent No.3 entrusted certain works, namely, State Highway maintenance for three years in PWD Division, Tumkur- 2005-2008, Package-A to the petitioner. Accordingly, a contract was signed between the petitioner and Respondent No.3 on 28.11.2005 and an agreement was executed on 16.12.2005 and work order was issued to the petitioner on 16.12.2005. It is averred in the petition that the petitioner successfully completed the work including the maintenance of the work for a period of two years and thereupon, a certificate was issued to the petitioner on 31.10.2009.
5. It is also pleaded in the writ petition that on 30.06.2016, the petitioner has entered into a contract with Respondent No.2-Delhi State Highway Development Project for Rs.36,39,35,504/- for the work of making of certain improvements of certain stretches of State Highway in Tumkur District. Later, an acceptance was issued to the petitioner on 04.06.2016 and an agreement was executed on 30.06.2016 and a notice to proceed with the work was issued on 30.06.2016. It has been pleaded in the petition that the said contract is a running contract. However, Respondent No.2, while making payment of R.A.Bill No.2, reserved a sum of Rs.78,50,000/- for Respondent No.3. On an enquiry being made, the petitioner was informed that the aforesaid amount would not be released to the petitioner for the present, as the same has been reserved for Respondent No.3 in pursuance of the communication sent by Respondent No.3 dated 22.01.2018. In the aforesaid factual background, the petitioner has approached this Court.
6. Learned counsel for the petitioner has raised a similar contention that even assuming that Respondent No.3 has to recover some amount from the petitioner, that amount cannot be recovered from the petitioner from an amount due to the petitioner under another Contractor.
7. In support of aforesaid submission, learned counsel for the petitioner has relied upon a decision of the Supreme Court in ‘STATE OF KARNATAKA v/s. RAMACHANDRA RICE MILLS’, (1987)2 SCC 160 and GANGOTHRI ENTERPRISES LIMITED v/s.UNION OF INDIA AND OTHERS (2016)11 SCC 720.
8. On the other hand, learned counsel for Respondent No.3 submitted that since the amount was due and payable to the petitioner, Respondent No.3 was well within its right to request to set apart the amount which was due and payable by the petitioner.
9. I have considered the submission made by the learned counsels for the parties.
10. The issue involved in this petition namely that an amount due and payable from a contractor is not recoverable from another contractor is squarely covered by the decision of the Supreme Court in STATE OF KARNATAKA v/s. SHRI.RAMESHWARA RICE MILLS, THIRTHAHALLI (1987)2 SCC 160. It has been held that adjudication by the Officer regarding the breach of the contract cannot be sustained under law because a party to the agreement cannot be an arbitrator in his own cause. If there is a dispute and breach of any condition, adjudication should be by an independent person or body and not by the other party to the contract.
11. In view of the aforesaid enunciation of law, the impugned communication dated 22.01.2018 is hereby quashed and set aside. Respondent No.2 is directed to release the amount due to the petitioner under R.A.Bill No.2 including an amount of Rs.78,50,000/-.
Needless to state that Respondent No.3 shall be at liberty to take action against the petitioner for recovery of the amount, if any due to it, in accordance with law.
With the aforesaid liberty, the Petition is disposed of.
Sd/- JUDGE bnv