SHREE GOPAL GOVIND SPONGE PRIVATE LIMITED Vs. COAL INDIA LIMITED
LAWS(JHAR)-2019-9-85
HIGH COURT OF JHARKHAND
Decided on September 11,2019

Shree Gopal Govind Sponge Private Limited Appellant
VERSUS
COAL INDIA LIMITED Respondents

JUDGEMENT

Sujit Narayan Prasad, J. - (1.) This writ petition is under Article 226 of Constitution of India, whereby and whereunder, initially notice for termination of agreement dated 31.08.2017, which was issued by the General Manager (M & S), Central Coalfields Limited to which the petitioner has responded by filing reply vide Annexure-16, was under challenge but, in course of pendency of the writ petition, the authorities having taken final decision on 27.02.2018 rejecting the reply submitted by the petitioner in terms of notice dated 31.08.2017, it occasioned the petitioner to file an interlocutory application (I.A. No. 2244 of 2018), seeking relief from the Court to make necessary amendment in the prayer of the writ petition. This Court vide order dated 23.03.2018 has allowed the prayer made in the aforesaid interlocutory application by granting relief to the petitioner to make necessary amendment in the writ petition. In pursuance thereto, amended writ petition has been filed.
(2.) Learned counsel appearing for the petitioner submitted that after the amendment having been allowed to be incorporated to the original prayer of the writ petition, now the notice which was assailed in the writ petition has been culminated and the final decision taken by the authorities as on 27.02.2018 has been assailed by the petitioner, inter alia on the ground that the authorities while passing such order have not assigned any reason although it has been reflected from the said order that the reply submitted by the petitioner in terms of the notice has been found as "unsatisfactory". According to the petitioner, after receiving notice he has submitted exhaustive reply for its consideration, but in one line, the reply was held to be "unsatisfactory" and the contract has been terminated and the banker has been advised to encash the bank guarantee in favour of Central Coalfields Limited and, therefore, the said order cannot be said to be sustainable in the eyes of law and, hence, the same is fit to be quashed. Further submission has been made by the learned counsel for the petitioner while assailing the aforesaid order that the fault lies on the part of the respondent-CCL in terminating the Coal Supply Agreement. It is submitted that on one pretext or other, the supply could not be made, which resulted into non-supply of coal and ultimately the respondent-authorities invoked the provisions of Clause 15.1.4 of the Coal Supply Agreement and issued notice while the content of the said notice has been denied so far as lifting of less quantity of coal by the petitioner is concerned, but has not been considered since the impugned order has been passed.
(3.) Mr. Amit Kumar Das, learned counsel appearing for the respondent-CCL has vehemently opposed the submission agitated by the petitioner while submitting that the petitioner is raising issue of non statutory contract when the terms and conditions of the Coal Supply Agreement is known to the petitioner. One of the conditions as has been mentioned under Clause 15.1.4 with Clause 3.6 pertaining to forfeiture of security deposit, the petitioner ought to have lifted the coal as per the condition stipulated under Clause 15.1.4 taking into consideration the fact that non-lifting of coal in pursuance of the condition stipulated under Clause 15.1.4 of the Coal Supply Agreement will cause termination of coal agreement. Learned counsel for the respondents further submitted that it appears from the fact which has been agitated by the petitioner that the petitioner has challenged the impugned order pertaining to terms and conditions incorporated in the Coal Supply Agreement and the petitioner has not agitated any vital aspect and, hence, the writ petition will not lie under Article 226 of the Constitution of India. Learned counsel for the respondents further submitted that remedy has been made available under the Coal Supply Agreement for its redressal. So far as contention raised by the petitioner regarding non-supply of coal is concerned, the submission as has been made even accepted as true, the petitioner is not entitled to get any relief from the Court as per the terms and conditions incorporated in the Coal Supply Agreement as it appears from the material available on record about some undisputed fact i.e. the petitioner has entered into agreement known as Coal Supply Agreement as on 30.04.2008, which is annexed at Annexure-1 to the writ petition for supply of coal with certain terms and conditions. Clause 15.1.4 of the agreement reads as under: "15.1.4 In the event that the Level of Delivery (LD) falls below thirty percent (30%) or the Level of Lifting (LL) falls below thirty percent (30%), the Purchaser or the Seller as may be the case, shall have the right to terminate this Agreement, within sixty (60) days of the end of the relevant Year after providing the other Party with prior written notice of not less than thirty (30) days." Learned counsel for the respondents further submitted that no restriction was imposed by the Central Coalfields Limited in filing the rail program without submission of D.I. Certificate and as such the level of lifting in respect of the petitioner remained below 30% for the year 2016-17 due to inaction on the part of the petitioner and, therefore, as per Clause 16.1.4 of the Coal Supply Agreement, show cause notice dated 31.08.2017 was issued to the petitioner. The petitioner after accepting the terms and conditions of the Coal Supply Agreement has started lifting the coal, but meanwhile certain dispute has arisen with respect to exemption of D.I. Certificate which in the instant case was to be issued by the West Bengal since the petitioner's unit is situated within the territorial jurisdiction of the State of West Bengal, but ultimately the exemption has been granted by the CCL authority by taking general decision in this regard, but even after the exemption has been granted in this regard, the petitioner has failed to lift the coal as required under Clause 15.1.4 of the Coal Supply Agreement which has resulted into issuance of notice of termination of agreement by notice dated 31.08.2017 asking the petitioner to explain its position within 30 days of issuance of notice, which is evident from the notice of termination of agreement (Annexure-15), whereby, it has been stated that as per the terms and conditions stipulated under Clause 16.1.4 the level of lifting has fallen below 30% during 2016-17 and, therefore, the agreement is required to be terminated.;


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