Hon'ble Mrs. Saroj Yadav,J.
Notice on behalf of opposite party no.1 has been accepted by learned Chief Standing Counsel, whereas Mr. Ratnesh Chandra, Advocate has accepted notice on behalf of opposite parties no.2 to 4.
Heard Mr. Sanjay Bhasin, learned Senior Advocate assisted by Mr. Sudhanshu Chauhan, learned counsel on behalf of the petitioner, learned Standing Counsel on behalf of the State as well as Mr. Ratnesh Chandra, learned counsel appearing on behalf of opposite parties no.2, 3 and 4.
The instant writ petition has been filed seeking following reliefs:
"i. To issue a writ order or direction in the nature of certiorari quashing the order dated 05.02.2021 and the order dated 15.05.2020 morefully annexed as Annexure No.1 and Annexure No.2 respectively to the writ petition.
ii. To issue a writ order or direction in the nature of mandamus commanding the respondents to release the admitted amount of the petitioner amounting to three months of advance rent and the bank guarantee of Rs.75,00,000/- in favour of the petitioner.
iii. To grant any other relief / reliefs which the Hon'ble Court deems fit in the circumstances of the case.
iv. To award the cost of the present proceedings in favour of the petitioner against the opposite parties."
Mr. Sanjay Bhasin, learned Senior Advocate appearing on behalf of the petitioner has argued that an agreement between the petitioner and the respondent- U.P. State Road Transport Corporation Ltd. was entered on 14.12.2018 which was to commence from 1.1.2019 for a period of three years. As per the agreement the parties were free to terminate the agreement after giving three months notice. The petitioner had deposited three months of advance rent and bank guarantee of Rs.75,00,000/-, besides post dated cheques towards license fee from April, 2019 to December, 2019.
It is also submitted that in view of various hindrances faced by the petitioner by the private bus owners and also leading to tearing advertisements and threats to the staff of the petitioner the date of commencement of agreement was extended from 1.1.2019 to 1.4.2019. Even despite the extension of the date of agreement the work in fact could not commence as private bus owners did not provide their vehicles for display of advertisements. It is submitted that in fact vide letter dated 15.1.2020 the petitioner was informed that the date of commencement of agreement can be extended to 1.2.2020 and in this regard appropriate action would be taken.
The submission is that the petitioner was given the impression that the agreement has commenced from 1.2.2020. It is further submitted that due to Covid-19 pandemic the buses were not plying on the road, the work under the agreement could not commence, however, the petitioner were issued impugned show cause notice dated 15.05.2020 requiring them to deposit Rs.2,65,20,579/- and it was also informed that the said agreement shall stand terminated with effect from 30.05.2020. In this regard it has been informed by learned counsel for the petitioner that in fact the petitioner itself had terminated the agreement with effect from 31.03.2020 and had duly informed the opposite parties in that regard and had requested for return of all the money paid by them to the opposite parties.
Mr. Sanjay Bhasin, learned Senior Advocate appearing on behalf of the petitioner has emphasized that now by the impugned order dated 5.2.2021 the opposite parties have required the petitioner to pay the balance amount of Rs.3,02,89,492/- after confiscating the bank guarantee of the petitioner to the tune of Rs.75,00,000/- and adjusting the same in the alleged outstanding amount which is said to be towards the license fee, GST and penalty.
Submission is that when the work has not commenced the petitioner were not liable to pay the said amount which pertains to the period from July, 2019 to March, 2020. The emphasis has been laid by learned counsel for the petitioner that it is a final order as it determines the total outstanding amount against the petitioner and requires the petitioner to deposit the same within certain period i.e. before 15.02.2021. It is submitted by learned counsel for the petitioner that the order impugned indicates that in case the petitioner did not deposit the alleged outstanding amount before 15.02.2021 they will invoke paragraph no.6 (iv) of the agreement for recovery of the alleged outstanding amount as arrears of land revenue or by any other such mode as may be applicable under any law for the time being in force. It is also submitted that not only that, the petitioners have also been blacklisted from participating in any tender issued by State Road Transport Corporation for indefinite period. In this regard it has been submitted that the said blacklisting has been done without providing any opportunity to the petitioner.
In support of his submissions learned counsel for the petitioner has relied on the judgment of Hon'ble Apex Court in the case of Gangotri Enterprises Limited. Vs. Union of India and others1 particularly paragraph 40 of the judgment in order to emphasize that the opposite parties have no right to encash the bank guarantee unilaterally till the outstanding amount is determined. He has also relied on the judgment of Hon'ble Apex Court in the case of Tulsi Narayan Garg, Sarawagi Mohalla Sheopur through its Proprietor Tulsi Narayan Garg Vs. M.P. Road Development Authority, Bhopal & others2 particularly paragraph 12 of the judgment on the point that a party to the agreement cannot be an arbiter in his own cause, interest of justice and equity requires that where a party to a contract disputes the committing of any breach of conditions of contract the adjudication should be by an independent person or body and not by the other party to the contract. Learned Senior Advocate appearing on behalf of the petitioner has also relied on the judgment of Hon'ble Apex Court in the case of Vetindia Pharmaceuticals Limited Vs. State of U.P. and another3 particularly paragraphs 12 to 15 of the judgment on the point that the blacklisting cannot be for indefinite period.
Mr. Ratnesh Chandra, learned counsel for the opposite parties no.2 to 4, on the other hand, has raised an objection regarding maintainability of writ petition on the ground that the agreement between the petitioner and the opposite parties has an arbitration clause and in case the petitioner feels aggrieved and disputes the alleged outstanding dues, it may invoke the arbitration clause and the writ petition directly in the High Court would not be maintainable. It is also submitted that the order impugned does not impose any blacklisting on the petitioner and as such it is wrong to say that the petitioner has been blacklisted without providing opportunity for indefinite period.
We have considered the submissions made by parties' counsel and gone through the records.
There is no dispute between the parties that as per the agreement dated 14.12.2018 which has been entered between the petitioner and the opposite party no.2, in case of any dispute between the parties the dispute resolution forum has been provided and the matter shall be referred to an Arbitrator appointed by mutual consent of the parties (para 20 of the agreement). The perusal of impugned order dated 5.2.2021 indicates that the petitioners were issued a show cause notice dated 15.02.2020 requiring them to deposit the license fee, GST for the period from April, 2019 to March, 2020 which was to the tune of Rs.2,65,20,579/-. The petitioner had filed its reply to the said show cause notice and disputed the said alleged outstanding amount. As per the petitioner nothing was payable at their end. The order impugned also indicates that the petitioner has been required to deposit the license fee and GST for the period July, 2019 till March, 2020 and penalty at the rate of 0.1 per cent per day has been imposed. The petitioner is required to pay the said amount by 15.02.2021. The order impugned also indicates that the bank guarantee of Rs.75,00,000/- given by the petitioner has been confiscated and the said amount of Rs.75,00,000/- shall be adjusted in the total outstanding amount of Rs.3,77,89,492/-.
The perusal of impugned order makes it very much clear that in case the petitioner fails to deposit the total outstanding amount within the period prescribed then the opposite parties will invoke paragraph 6 (iv) of agreement in order to make the recovery of the total outstanding amount from it and the cost of process will also be recovered from the petitioner. The petitioner shall also be liable to pay interest at the rate of 21.75 per cent per annum.
So far as the contention of learned counsel for the petitioner with regard to the alleged outstanding amount is concerned and submission of learned counsel for the petitioner that there is no outstanding amount against the petitioner we are of the considered view that they are the disputed questions of facts for which the writ jurisdiction is not appropriate forum particularly when there is an arbitration clause in the agreement between the parties.
In case the petitioner disputes the alleged outstanding amount required to be deposited by him as mentioned in the impugned order is concerned, the petitioner can raise the dispute by invoking the dispute redressal forum and avail the remedy of arbitration as provided under the agreement. In this regard writ petition would not be maintainable.
So far as the contention of learned counsel for the petitioner that the petitioner has been blacklisted for indefinite period and that too without providing any opportunity is concerned Mr. Ratnesh Chandra, learned counsel for opposite parties no.2 to 4 has submitted that till date no proceedings for recovery of alleged outstanding amount of Rs. 3,77,89,492/- has been initiated against the petitioner and no coercive action has been taken against the petitioner including the blacklisting of the petitioner.
The perusal of the impugned order dated 5.2.2021 clearly indicates that the petitioner-company has not been blacklisted till now and it has been only informed that in case they fail to deposit the required amount within the time prescribed they would be debarred from participating in any tender issued by State Road Transport Corporation for working against the terms of the contract dated 14.12.2018. It does not provide that the petitioner has been blacklisted, as such, the contention of learned counsel for the petitioner in this regard has no force and it is rejected.
The judgments cited by the petitioner in support of his submissions as referred above do not support the case of the petitioner. In case of Gangotri Enterprises Limited. Vs. Union of India and others (supra) paragraph 40 relied by learned counsel for the petitioner itself indicates that in that case the arbitration proceedings were pending between the parties. So far as the judgment of Apex Court in the case of Tulsi Narayan Garg, Sarawagi Mohalla Sheopur through its Proprietor Tulsi Narayan Garg Vs. M.P. Road Development Authority, Bhopal & others (supra) is concerned there is no dispute to the legal proposition that a party to the agreement cannot be an arbiter in his own cause. In the present case the opposite parties have not adjudicated the dispute between the parties as it has only raised a demand to the petitioner and the petitioner has been called upon to deposit the same. In case the petitioner disputes the said demand then it has a remedy of invoking the provisions of arbitration under the agreement. In the case of Vetindia Pharmaceuticals Limited Vs. State of U.P. and another (supra) the Apex Court has held that the blacklisting cannot be for indefinite period. In the present case no blacklisting has been done, as such, the judgments relied upon by learned counsel for the petitioner have no relevance.
In view of above, we are of the considered view that the writ petition lacks merit, which deserves to be dismissed. It is accordingly dismissed.
[Mrs. Saroj Yadav,J.] [Ritu Raj Awasthi, J.] Dated: 18th February, 2021.
Ram/-