'Private Contract, Writ Not Maintainable': Karnataka HC Refuses Interference In Super Specialty's Dispute With Bharat Biotech Over Covaxin Supply

United Brothers Healthcare Services Pvt had entered into an agreement with Bharat Biotech for supply of 25,000 doses (2,500 vials) of Covaxin and the entire invoice amount of Rs. 2.6 crore was agreed to be paid in advance. Pursuant to the agreement, the petitioner-Hospital also undertook certain advertisements for distribution of the said vaccine which purportedly costed Rs.30 lakhs. However, the vaccine could not be pushed through to general public owing to its negative publicity in the absence of WHO approval at the time.

The Hospital claimed that the consignment crossed its shelf life and Bharat Biotech back tracked its offer to refund. Therefore, the petitioner-Hospital issued a legal notice upon to Bharat Biotech which in turn denied all the claims. This led to the subject petition.

At the outset, referring to the contract, the bench observed that the conditions and covenants therein were mutually agreed between the two parties and no element of any wing of the State had stepped into the contract in any manner.

"Therefore, with eyes wide open the petitioner/Hospital enters into the agreement with the 4th respondent and the agreement is purely a commercial transaction between two private entities...The State or any other Authority that can be a State under Article 12 of the Constitution of India is not privy to the said private contract. The contract may have been for supply of vaccines and vaccines to be administered to the general public. This cannot make a private contract metamorphose into a statutory contract."

Refusing to accept the contention of the petitioner that it was a public duty of Bharat Biotech to have supplied vaccine for administration to the general public and the vaccine itself was developed on a public-private partnership and therefore, the public law remedy would become available, notwithstanding a private contract, for supply of vaccine, the court said,

"These contentions are sans substance. Merely because covaxin is taken by millions and millions of people of the nation would not make a private contract to become enforceable or justiciable in the Courts of law, which are predominantly meant for public law remedy. The submissions made in support of maintainability or entertainability of the petition are all rendered acceptable, as they are fundamentally flawed."

It also rejected the submission of the petitioner that it would come within 'other authorities' under Article 12 of the Constitution of India. The bench observed "Neither the petitioner/Hospital nor the Company would in any way come within the definition of 'other authorities' for they do not discharge any public function, their generation of business is purely on private interest and on commercial lines."

It held,

"Remedy under Article 226 of the Constitution of India is pre-eminently a public law remedy and is not generally available as a remedy against private wrongs. The scope of issuance of a writ in the nature of mandamus is limited to enforce public duty."

The bench expressed,

"I fail to understand what is the public duty that is sought to be projected in the case at hand. The petitioner/ Hospital or the 4th respondent-Company neither discharge public duty nor they can be construed to be "Other Authority", to seek a public law remedy at the hands of this Court. Therefore, the powers of the Court which deal with public law remedy is not ajar, but closed, to the issue in the case at hand. Wherefore, the petition is neither maintainable nor entertainable, as this Court would not issue a writ that would interfere with a private contract between two private entities."

Further it clarified "It is for the petitioner/Hospital to avail all such remedy, as is available in law seeking recovery of money."

Case Title: M/s United Brothers Healthcare Services Pvt. Ltd v. Ministry of Health And Family Welfare, Government of India & Others

Case No: WRIT PETITION No.9587 OF 2022

Citation: 2022 LiveLaw (Kar) 507

Date of Order: 06-12-2022

Appearance: Sr Advocate B K Sampath Kumar a/w Advocate Thammaiah H N, for petitioner; Advocate Jagannath V C for R1; Senior Advocate Harish B N for Advocate Nayana Tara B G for R3; Advocate Akash V T for R4.