D.N.Patel, J. - (1.) DT. 21.09.2010 All these Letters Patent Appeals have been preferred challenging a common judgment and order, passed by the learned single Judge dated 19th May, 2010 in various writ petitions. All these Letters Patent Appeals, involving common questions, have been heard together at length for their final disposal and are bein disposed of by this common judgment.
(2.) DISPUTE between the parties: The respondents suspended supply of coal to the appellants-industrial units and terminated the Coal Supply Agreement with effect from November, 2009 and, therefore, writ petitions were preferred by the present appellants for getting supply of coal and for quashing the letters whereby Coal Supply Agreements were terminated. Factual Matrix: The appellants are S.S.I. Units situated at Daltonganj Industrial Estate in Palamau district. The Jharkhand State Mineral Development Corporation Ltd. has been nominated as State Nodal Agency by the Government of Jharkhand for distribution of coal under N.C.D.P., 2007 of MOC/UOI. The respondent JSMDC executed an agreement to sell on 15.07.2008 for sale of coal to the appellant unit @ 4200 MT per annum. The clause of termination i.e. Clause-11 of the Agreement dated 15.07.2008 lays down the conditions for termination of the Agreement and Clause-12(ix) prescribed for Arbitration in case of any dispute. The Meeting of a High-level committee was held on 15th October, 2009, attended by Secretary, Department of Industries, Director, Industries, Managing Director, JSMDC and In-charge, Coal trading, JSMDC and as per the outcome of the meeting, directions were issued on 22.10.2009 that the supply of coal shall be suspended till the inquiry against the appellants- industrial units is completed. The details of these directions are at Annexure A to the counter affidavit, filed by respondents 2, 3 and 4 in L.P.A. No. 238 of 2010. Thereafter, impugned letter dated 17.11.2009 was issued to the appellant- industrial unit in the first L.P.A. No. 238 of 2010, arising out of W.P.(C) No. 5385 of 2009, which reads as under: "To M/s Mahalaxmi Enterprises Nimia, Sudana Palamau (Jharkhand) Sub.: Order terminating Agreement No. 131 dated 10.08.2009 for sale of coal between M/s Jharkhand State Mineral Development Corporation Ltd., Doranda, Ranchi and M/s Mahalaxmi Enterprises District Palamau. Sir, M/s Jharkhand State Mineral Development Corporation Ltd., Doranda, Ranchi has been entrusted with the duty of sale and distribution of coal to small/medium scale industrial units on the recommendation of District Level Committee and State Level Committee under New Coal Distribution Policy, 2007 vide resolution of the Dept. of Mines & Geology dated 13.05.2008 published in Jharkhand Gazette No. 395 dated 15.05.2008. In the Jharkhand Gazette No. 395 dated 15.05.2008, it has been clarified that the District Level Committee is to verify the consumption and utilization of coal allocated to these units and the State Level Committee will examine the utilization of coal on the report by the District Level Committee. The Director of Industries, Jharkhand, Ranchi vide its letter No. 1653 dated 6.7.08 sought for utilization report in the prescribed format from 181 industrial units. As per the report received from the Dept. of Industries it was found that 64 units are working while 14 units have not been established. Letters sent by the Industries Department in respect to 62 units have returned undelivered while in respect to 41 units no utilization report could be received by the Industries Department as is evident from the above mentioned letter. The Secretary, Dept. of industries, Govt. of Jharkhand, Ranchi has therefore directed the Managing Director JSMDC Ltd. to cancel the allotment of coal if being made in respect to 62 units whose whereabout are not known. The Director Industries Govt. of Jharkhand by her letter no. 2633 dated 11.11.09 has forwarded a list containing names of 62 units with a direction to comply with the decision taken in the meeting held on 15.10.09 and communicated to the Corporation vide letter No. 2492 dated 22.10.09 where by the Managing Director JSMDC Ltd. has been directed to cancel/terminate allotment of coal and report compliance to the said Directorate. Now, therefore, in view of the orders and the directions passed by the Secretary, Industries Department. The Director of Industries, Govt. of Jharkhand, Ranchi and clause 11(V) of the Coal Supply Agreement No. 131 Dated 10.08.2009 is hereby terminated. You are directed to collect amount if any, due to you from the Corporation, upon reconciliation of account within a period of 15 days from the date of receipt of this order. By order of the competent authority. Yours faithfully, (Pravir Kumar) I/c Coal Trading Cell" The aforesaid letter of termination of Coal Supply Agreement is under challenge in the writ petitions. During hearing of writ petitions, learned single Judge by order dated 4th December, 2009 called for report from the Sub Judge-I, Palamau at Daltonganj, about existence of petitioners industrial units and whether they were working. This report is dated 15th December, 2009. Copy of this report of Sub Judge-I, Palamau at Daltonganj, was given to the parties. Objections were invited. Respondents objected the report on the ground that the petitioners units are not working, but, they got sufficient time, to manage their show, by window-dressing. Order passed by the learned single Judge is dated 4th December, 2009 and inspection was carried out on 13/14th December, 2009. Being satisfied by this objection, another report was called secretly and without giving any time to the petitioners by learned single Judge about existence of the industrial units and whether they are working, from Vigilance Bureau, State of Jharkhand, Ranchi, who gave report dated 3rd April, 2010. As per Vigilance Bureau's report, the appellants-industrial units are closed since long. Several statements have also been recorded of the witnesses by Vigilance Bureau. Now there being Arbitration clause in Coal Supply Agreement and looking to disputed question of fact, whether appellants-industrial units are working and whether coal was used for specified end-product or not, learned single Judge dismissed writ petitions, vide judgment and order dated 19th May, 2010. Against this common judgment, these Letters Patent Appeals have been preferred by the appellants, who are original petitioners.
(3.) ARGUMENTS: On behalf of the appellants, it is submitted that the appellants are working factories and, therefore, the coal supply, which has been terminated by the respondents, is illegal. Even there is a report of the learned Sub Judge-I, Palamau at Daltonganj, dated 15th December, 2009 and in pursuance of this report also, the appellants are working units and hence the supply of coal, which has been discontinued from October, 2009, must be revived and resumed. It is further submitted that another report given by the Vigilance Bureau, Jharkhand, Ranchi, is absolutely a wrong report and no reliance can be placed upon it. This aspect of the matter has not been properly appreciated by the learned single Judge and hence the impugned judgment and order, passed by the learned single Judge dated 19th May, 2010 in the writ petitions, deserves to be quashed and set aside. We have heard learned counsel appearing for the respondents, who has submitted that the appellants were initially supplied 350 MT coal per unit per month from April, 2009 and in July, they were asked to submit Utilization Report along with other documents and informations. These details were called in a prescribed format from 181 Industrial units by the Directorate of Industries. The Department of Industries has given a report to the effect that 64 units were working while 14 units have not been established. The letter sent by the Department of Industries in respect to 62 units have returned undelivered, while in respect to 41 units, no Utilization Report could be received by the Department of Industries and therefore, a decision was taken by the Secretary, Department of Industries, Government of Jharkhand, Ranchi, to cancel the allotment of coal in respect of 62 units whose whereabouts were not known. Thereafter, as per Clause 11(V) of Coal Supply Agreement No.1 dated 15th July, 2008, the Coal Supply Agreement was terminated. This letter was issued on 17th November, 2009 in case of one of the appellants, namely, M/s Shiv Coke Briquettes and MFG. Company [W.P.(C) No. 5369 of 2009]. This letter was challenged in the writ petition. It is further submitted by the learned counsel for the respondents that after receiving the report of Sub Judge-I, Palamau at Daltonganj, a detailed counter affidavit was filed by the respondents and it was brought to the notice of this Court that the appellants are, in fact, not working units and they got the time of nine to ten days to manage the show by window dressing, because the order, passed by this Court dated 4th December, 2009 for inspection by Sub Judge-I was, in fact, carried out on 13/14th December, 2009 and, therefore, the learned single Judge rightly got a confidential report done through the Vigilance Department and a letter was issued on 19th March, 2010 to the Director General of Police, Vigilance Bureau, Jharkhand, Ranchi. This report was given by the Senior Deputy Superintendent of Police, Vigilance Bureau, Ranchi, Jharkhand, on 3rd April, 2010. The report was given in two sealed cover to this Court. Copies of these reports were also given to the original writ petitioners. Looking to this report, it appears that the appellants are not using the coal for manufacturing. Moreover, looking to the arbitration clause in the agreement, it appears that the dispute can be raised before the arbitrator. Further looking to the report given by the Vigilance Bureau, it appears that the appellants-units are not working and, thus, no error has been committed by the learned single Judge in dismissing the writ petitions. When both the parties are claiming breach of contract and whenever there is existence of arbitration clause in the agreement, arbitration clause ought to have been invoked by the appellants and, therefore, rightly their petitions have been dismissed by the learned single Judge.;