No Absolute Bar On Citizens To Invoke Writ Jurisdiction In Contractual Matters With State: Jammu & Kashmir High Court

The Jammu and Kashmir and Ladakh High Court recently ruled that in matters of contractual dispute with the State and its instrumentalities there is no absolute bar to exercise the writ jurisdiction and the High Court should take a holistic view and make a determination as to whether it would be proper to exercise its writ jurisdiction.

Justice Wasim Sadiq Nargal observed,

"There has been paradigm shift in the approach of the Courts in exercise of its Writ Jurisdiction in the matters of contractual disputes with State and its authorities. The law regarding the exercise of judicial review in contractual matters with State or its instrumentalities has definitely evolved over the years and the ordinary citizens can, in appropriate cases, approach the High Courts for exercise of Writ Jurisdiction."

The observation was made while hearing a plea in terms of which the petitioner was seeking directions upon the UT administration to release the bill amounting to Rs.40.71 lacs in favour of petitioner on account of execution of construction of two fountains at Hyderpora Crossing, Srinagar.

In his plea, the petitioner submitted that the sum due to the petitioner is an admitted liability and the respondents have no reasonable ground or any valid justification to withhold the same and withholding the same amounts to an arbitrary exercise of power.

The petitioner further submitted that despite the admitted liability, the respondents have failed to release the admitted amount in favour of the petitioner on one pretext or another. Despite repeated requests to respondents for release of the bill, the respondents till date have not released the admitted amount, which is unjust and unreasonable on part of respondents, the petitioner argued.

Per contra, respondents submitted that the construction work in question was never allotted by the competent authority to the petitioner and thus, there is no question of release of admitted liability as claimed by the petitioner in the present writ petition.

After anxiously considering the rival contentions Justice Nargal pointed that the record which has been placed on record along-with the report, is sufficiently clear that there has been a series of correspondence exchanged between the petitioner and the respondents, wherein, the petitioner has been asked to execute the work. The petitioner has executed the work on the strength of a communication dated 21st October 2017 and now, it does not lie in the mouth of respondents to agitate that there was no valid contract between the parties or there was no formal allotment order/administrative approval in favour of petitioner by the respondent corporation, the court recorded.

Elaborating further on the matter Justice Nargal observed that despite no formal agreement was signed between the parties nor the same has been produced on record either by the petitioner or the respondents, yet the documentary evidence which has been placed on record by the petitioner clearly proves, beyond any shadow of doubt there was correspondence between the petitioner and the respondents which shows that a binding contract came into existence between the parties.

Explaining the obligation of a person enjoying the benefit of a non-gratuitous act, Justice Nargal observed that Section 70 of the Indian Contract Act, applicable herein, clearly prescribes that if something was done by one party for another and that the work so done voluntarily, was accepted by the other. Therefore, as a corollary, the plea that there was a subsisting contract in the nature of business transactions, is antithetic to the very essence of section 70, the bench underscored.

Highlighting the series of communications between the parties which have not been denied by the respondents, the bench observed that it can safely be concluded that there was a binding contract between the parties and the respondents cannot escape from their liability of making the payment to the petitioner arising out of the said binding contract.

"Law does not put any bar or any fetters on the High Court in respect of exercising its writ jurisdiction in contractual matters", Justice Nargal maintained.

In view of the legal position the bench allowed the petition and directed the respondents to release the admitted liability/payment in favour of petitioner to the tune of Rs.40.71 lacs within a period of four weeks.

Case Title: Mukhtar Ahmad Andrabi Vs UT of J&K & Ors.

Citation: 2023 LiveLaw (JKL) 55

Coram: Justice Wasim Sadiq Nargal

Counsel For Petitioner: Mr Javid Hamid

Counsel For Respondent: Mr. Moomin Khan.

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