- (1.) Whether or not the respondents are justified in withholding payment due to the petitioners invoking clause 18 of the Condition of Contract Governing Contracts placed by the Central Purchase Organisation of the Government of India (hereafter the contract) while inspection of jute bales supplied by them is in progress at the end of the purchaser and in the absence of any dispute regarding quality thereof having been raised by it, is the sole question that arises for decision on this writ petition.
(2.) Facts preceding presentation of this writ petition on September 13, 2013 are required to be noted.
(3.) M/s. Abhishek Projects Pvt. Ltd. (hereafter Abhishek) and the first petitioner have common directors. Abhishek had supplied plastic bags to the respondents, which on inspection were found to be defective. However, Abhishek had been paid the value of the plastic bags. To recover the loss sustained owing to supply of defective plastic bags by Abhishek, the axe fell on the first petitioner which had supplied jute bales to the respondents. An amount in excess of Rs. 10 crores payable to the first petitioner was withheld. This resulted in the first round of litigation between the parties. W.P. 21845(W) of 2013 was presented before this Court by the petitioners challenging withholding of payments. It was considered by me on July 25, 2013. While admitting the writ petition and calling for affidavits, I had directed that the payments to which the petitioners were entitled should not be withheld only on the ground that Abhishek had supplied defective plastic bags. However, the respondents were not precluded from withholding payment in favour of the first petitioner strictly in terms of the agreement executed by and between the parties.;