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Wednesday, August 19, 2015

Contract disputes - Writ proceedings - whether Maintainable ? - No - High court - where under he had declined to interfere with the order of the Secretary, Public Works Department, Road and Projects of the State terminating the contract awarded to the respondent and forfeiting the security deposit placed by the contractor for the work to the state and further stating that the work had been put an end to at the cost and risk of the contractor.= Division Bench reversed - Apex court held thatWe have referred to the aforesaid authorities to highlight under what circumstances in respect of contractual claim or challenge to violation of contract can be entertained by a writ court. It depends upon facts of each case. The issue that had arisen in ABL International (supra) was that an instrumentality of a State was placing a different construction on the clauses of the contract of insurance and the insured was interpreting the contract differently. The Court thought it apt merely because something is disputed by the insurer, it should not enter into the realm of disputed questions of fact. In fact, there was no disputed question of fact, but it required interpretation of the terms of the contract of insurance. Similarly, if the materials that come on record from which it is clearly evincible, the writ court may exercise the power of judicial review but, a pregnant one, in the case at hand, the High Court has appointed a Commission to collect the evidence, accepted the same without calling for objections from the respondent and quashed the order of termination of contract. The procedure adopted by the High Court, if we permit ourselves to say so, is quite unknown to exercise of powers under Article 226 in a contractual matter. We can well appreciate a Committee being appointed in a Public Interest Litigation to assist the Court or to find out certain facts. Such an exercise is meant for public good and in public interest. For example, when an issue arises whether in a particular State there are toilets for school children and there is an assertion by the State that there are good toilets, definitely the Court can appoint a Committee to verify the same. It is because the lis is not adversarial in nature. The same principle cannot be taken recourse to in respect of a contractual controversy. It is also surprising that the High Court has been entertaining series of writ petitions at the instance of the respondent, which is nothing but abuse of the process of extraordinary jurisdiction of the High Court. The Appellate Bench should have applied more restraint and proceeded in accordance with law instead of making a roving enquiry. Such a step is impermissible and by no stretch of imagination subserves any public interest. 21. Consequently, the appeal is allowed and the judgment and order passed by the Appellate Bench is set aside. However, in the facts and circumstances of the case, we refrain from imposing costs.

                        IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL NO. 6086 OF 2015
                        (@ SLP(C) NO. 19380 OF 2014)


State of Kerala & Ors.                       ... Appellants

                                   Versus

M.K. Jose                                          ... Respondent




                               J U D G M E N T


Dipak Misra, J.

      The present appeal, by special leave, assails the correctness  of  the
judgment dated 24.02.2014 passed by the High Court of  Kerala  at  Ernakulam
in W.A. No. 1912/2013 whereby the Appellate Bench has reversed the  decision
of  the  learned  Single  Judge  rendered  in  W.P.(C)  No.  22541  of  2013
where under he had declined to interfere with the  order  of  the  Secretary,
Public Works Department, Road and Projects  of  the  State  terminating  the
contract awarded to the  respondent  and  forfeiting  the  security  deposit
placed by the contractor for the work to the state and further stating  that
the work had been put an end to at the cost and risk of the contractor.
2.     Exposition  of  facts  with  essential  details  is   imperative   to
appreciate the controversy in proper perspective and also  to  consider  the
manner in which the Appellate Bench  has  exercised  the  writ  jurisdiction
under Article 226 of the Constitution in respect of  a  matter  relating  to
termination of contract.  The  respondent  was  awarded  the  work,  namely,
“Stimulus package-improvements to  Kannavam-Idumba-Trikadaripoyil  Road  Km.
0/000 to  9/100  in  Kannur  District”  and  accordingly  an  agreement  was
executed between the parties on  18.12.2010.  The  site  for  the  work  was
handed over to  the  respondent  on  27.12.2010  and  the  work  was  to  be
completed within a period of 12  months.   Thus,  the  work,  as  requisite,
under the terms of the contract was to be completed in all  respects  as  on
26.12.2011.  The respondent could not complete the work in  time  and  on  a
request being made,  time  was  initially  extended  up  to  30.06.2012  and
thereafter further extension was granted upto 31.03.2013.
3.    As is perceptible from the  order  of  termination  of  the  contract,
despite issue of several notices and instructions, the contractor failed  to
complete the work even during the extended period.  The  Executive  Engineer
of the Department issued a memorandum on 14.02.2013 stopping the  work.   As
there was some deviation of work, the revised estimate was  required  to  be
done but the same was not sanctioned by the Government.  At  that  juncture,
the respondent preferred  W.P.(C)  No.  5672  of  2012  seeking  appropriate
direction  to  the  Government  to  pass  orders  sanctioning  the   revised
estimate.  The High Court  disposed  of  the  writ  petition  directing  the
Principal Secretary to take a decision on the proposal of revised  estimate.
 Thereafter, the respondent filed a contempt petition which  was  eventually
dropped.
4.    As the factual matrix would further unfurl, the  respondent  submitted
a representation to the Government and thereafter filed  W.P.(C)  No.  23087
of 2012.  The High Court directed the Principal Secretary, PWD  to  consider
and pass orders on his representation.  It is apt  to  note  here  that  the
respondent had filed series of writ petitions, namely, W.P.(C) No. 26075  of
2012 and W.P.(C) No. 5690 of 2013  and  the  High  Court  vide  order  dated
08.04.2013 in W.P.(C) No. 5690 of 2013, directed the Secretary, PWD to  pass
appropriate orders in accordance with law.  Eventually, as has  been  stated
earlier, the contract was terminated.
5.    The said order of termination was  assailed  in  WP(C)  No.  22541  of
2013.  The learned Single Judge noted the facts and took note of prayer  no.
(c) which was for issue of a writ  of  mandamus  or  any  other  appropriate
writ, order or  direction  directing  the  respondents  to  take  steps  for
measurement of the work already completed by him  and  making  corresponding
entries in the measurement book.   The said prayer was  acceded  to  by  the
counsel for the State of Kerala and accordingly  the  learned  Single  Judge
directed measurement  of  the  work  to  be  completed  effecting  necessary
entries  in  the  measurement  book  before  finalization  of   the   tender
proceedings, if any, in respect of balance work.  The learned  Single  Judge
had also directed that the measurements should take place  after  notice  to
the contractor.
6.    The aforesaid order was assailed in the writ appeal.  When the  appeal
was listed for admission, the Appellate Bench,  on  17.12.2013,  passed  the
following order:-
“We heard the learned counsel for the appellant at length.  Ext.  P15  order
shows that more than 50% of the work remains to be completed.   The  learned
counsel for the appellant referred to paragraph 10 of the counter  affidavit
filed by the first respondent dated 15.3.2013 in W.P.(C) No.  5690  of  2013
(another writ petition filed by the appellant) wherein  it  is  stated  that
“over all 70% of total works completed so far”.   The  learned  counsel  for
the appellant submitted that nearly 90% of the work was over  and  the  work
could not be completed within the extended period since the  Department  did
not fulfil certain mandatory requirements in order to complete the work  and
since a stop memo was issued even before  the  expiration  of  the  extended
period.

2.    Learned counsel for the appellant  submitted  that  the  appellant  is
prepared to take out a commission to substantiate the  contention  that  90%
of the work is over.  Learned Government pleader sought for a short time  to
get instructions.  Since the matter is  urgent  and  since  the  courts  are
going to be closed on 20.12.2013, we are inclined  to  grant  only  a  day’s
time to get instructions  on  the  prayer  made  by  the  appellant  that  a
commissioner may be appointed.”

7.    On the adjourned date, the counsel for the State  submitted  that  the
respondent had  no  objection  for  appointment  of  Commissioner.   On  the
aforesaid basis, the
Division Bench appointed two Advocates as  joint  commissioners  to  inspect
the site and to submit the report  in  respect  of  the  disputed  questions
mentioned in the order dated 17.12.2013.  Thereafter, the Court  passed  the
following order:-
“The Commissioners would be free to seek the help of  a  competent  Engineer
for the purpose of enabling them to  prepare  a  report  which  would  throw
light on the disputed question involved in the case.  The appellant as  well
as respondents  would  provide  all  assistance  to  the  Commissioners  for
execution of their work.  The Commissioners would be entitled  to  call  for
any record from the appellant as  well  as  respondents  3  and  4  for  the
purpose of executing the work entrusted to them.”

8.    The Commission appointed by the Appellate  Bench  took  assistance  of
one Retired Assistant Executive Engineer, PWD who submitted a report to  the
commissioners, which was annexed to the Commission’s report.   We  need  not
refer to the report  which  has  been  reproduced  by  the  impugned  order.
However, the Engineer who assisted the Commission, in his report  under  the
heading ‘Details of work done’, has stated thus:-

“Anyhow the contractor has executed a minimum amount of work so  far  up  to
the commission, inspection date of 3.1.2014  of  Rs.2,27,90,383/-  which  is
72.24% of the revised estimate and 97.09% of  the  original  work  (Estimate
PAC).  There are some minor damages in the completed portion of  BT  surface
and white topped portion (concrete road) and the general  condition  of  the
whole work executed by the contractor  is  satisfactory.   A  detailed  item
wise statement is prepared and appended herewith  for  perusal  as  Annexure
A.”

9.    The Appellate Bench on the basis of the said report came to hold  that
the order of termination was founded on  erroneous  facts  inasmuch  as  the
competent authority had opined that more than 50% of the  work  remained  to
be done.  The Division Bench opining that as there  was  a  factual  defect,
which was evident from the commission’s report, the order of termination  of
contract was liable to be quashed and  accordingly  axed  the  same.   After
quashing the same, the High  Court  directed  the  Superintending  Engineer,
PWD, (Roads and Bridges) to consider and dispose of the matter afresh  after
affording an  opportunity  to  the  contractor  of  being  heard.   It  also
directed that the Commission’s report and  the  Engineer’s  report  and  the
accounts shall be produced by the contractor before the competent  authority
who shall take the same into account before taking  final  decision  in  the
matter.  After so directing, the High Court eventually ruled that:
“Since Exhibit P15 order is passed on incorrect data  and  since  that  data
was found to be incorrect by appointing Joint Commissioners, we are  of  the
view that the Government should bear the expenses of the  Commissioners  and
expenses of the Engineer in submitting the  reports.   Before  conducting  a
final hearing, a sum of Rs.40,000/- shall be paid by  the  first  respondent
to the appellant/writ petitioner.  Taking into account the work done by  the
Engineer, we think that an additional remuneration of Rs.5,000/-  should  be
paid to the Engineer.  The appellant/writ  petitioner  shall  pay  the  said
amount of Rs.5,000/- to the Engineer within 15 days and proof thereof  shall
be produced by the appellant before this Court.”

10.    We  have  heard  Mr.  Ramesh  Babu  M.R.,  learned  counsel  for  the
appellants and Mr. K. Parmeshwar, learned counsel for the respondent.
11.   The thrust of the matter is whether  the  Appellate  Bench  in  intra-
court appeal arising from a petition under Article 226 of the  Constitution,
should have carried out  the  exercise  that  it  has  done  and  eventually
quashed the order terminating the contract by the competent authority  of  a
Department on the ground that it was passed  on  erroneous  facts,  for  the
respondent contractor, as per  the  Commission’s  report,  had  done  higher
percentage of work.  We would not like to  comment  anything  on  the  order
passed by the learned Single Judge as that was not challenged by  the  State
before the  Appellate  Court  in  appeal.   The  learned  Single  Judge  had
directed measurement to be carried out prior to floating of tender  for  the
balance work.  That direction, as is  evident,  has  been  accepted  by  the
State.
12.   As the  factual  narration  would  reveal,  the  respondent  has  been
invoking the jurisdiction of  the  High  Court  under  Article  226  of  the
Constitution on various occasions challenging every action which pertain  to
extension of time, denial of revised estimate by the  State  Government  and
many other facets of that nature and the High Court, we must say,  has  been
generously passing orders for consideration by  the  appropriate  authority,
for grant of opportunity of being heard to the contractor  and  to  consider
his representation in accordance  with  law.   This  kind  of  orders  in  a
contractual matter, in our considered  view,  is  ill-conceived.   They  not
only convert the  controversy  to  a  disturbing  labyrinth,  but  encourage
frivolous litigation.  The competent authority  might  have  mentioned  that
more than 50% work remained to be done but that  should  not  have  prompted
the Appellate Bench hearing the intra-court appeal to appoint  a  Commission
of two  Advocates  and  granting  them  liberty  to  take  assistance  of  a
competent Engineer.  As  the  report  would  show,  the  Commission  of  two
Advocates have taken assistance of a retired  Assistant  Executive  Engineer
and submitted the report.  Though, learned counsel for  the  State  had  not
objected to the same, yet we really fail to fathom how a  writ  jurisdiction
can be extended to cause a roving enquiry through a Commission and  rely  on
the facts collected without  granting  opportunity  to  the  State  to  file
objections to the same and in the ultimate eventuate, cancel  the  order  of
termination of contract.  What precisely was the quantum of  work  done  and
whether there had been  a  breach  by  the  owner  or  the  contractor,  are
required to be gone into by the appropriate legal forum.
13.   A writ court should ordinarily  not  entertain  a  writ  petition,  if
there is a breach of contract involving disputed  questions  of  fact.   The
present case clearly indicates that the factual disputes are  involved.   In
State of Bihar v. Jain Plastics and Chemicals  Ltd.[1],  a  two-Judge  Bench
reiterating the exercise of power under Article 226 of the  Constitution  in
respect of enforcement of contractual obligations has stated:-
“It is to be reiterated that writ petition under  Article  226  is  not  the
proper proceedings for adjudicating such disputes. Under  the  law,  it  was
open to the respondent to approach the court of competent  jurisdiction  for
appropriate relief for breach of contract. It is settled law  that  when  an
alternative and equally efficacious remedy  is  open  to  the  litigant,  he
should  be  required  to  pursue  that  remedy  and  not  invoke  the   writ
jurisdiction of the  High  Court.  Equally,  the  existence  of  alternative
remedy does not affect the jurisdiction of the  court  to  issue  writ,  but
ordinarily that  would  be  a  good  ground  in  refusing  to  exercise  the
discretion under Article 226.”

In the said case, it has been further observed:-
“It is true that many matters  could  be  decided  after  referring  to  the
contentions raised in the affidavits and counter-affidavits, but that  would
hardly be a ground for exercise of extraordinary jurisdiction under  Article
226 of the Constitution in case of alleged breach of contract.  Whether  the
alleged non-supply of road permits by the appellants  would  justify  breach
of contract by the respondent would depend upon facts and  evidence  and  is
not required to be decided or dealt with in a writ petition. Such  seriously
disputed questions or rival claims of the parties with regard to  breach  of
contract are to be investigated and determined  on  the  basis  of  evidence
which may be led by the parties in a properly instituted civil  suit  rather
than by a court exercising prerogative of issuing writs.”

14.   In National Highways Authority of India v. Ganga  Enterprises[2],  the
respondent therein had filed a writ  petition  before  the  High  Court  for
refund of the amount.  The High Court  posed  two  questions,  namely,   (a)
whether the forfeiture of security deposit is without authority of  law  and
without any binding contract  between  the  parties  and  also  contrary  to
Section 5 of the  Contract  Act;  and  (b)  whether  the  writ  petition  is
maintainable  in a claim arising out of breach of contract.   While  dealing
with the said issue, this Court opined that:-
“It is settled law that disputes relating to contracts  cannot  be  agitated
under Article 226 of the Constitution of India. It has been so held  in  the
cases of Kerala SEB v. Kurien E. Kalathil[3], State  of  U.P.  v.  Bridge  &
Roof Co. (India) Ltd.[4] and Bareilly  Development  Authority  v.  Ajai  Pal
Singh[5]. This is settled law. The dispute in this case  was  regarding  the
terms of offer. They were thus contractual disputes in respect  of  which  a
writ court was not the proper forum.  Mr  Dave,  however,  relied  upon  the
cases of Verigamto Naveen v. Govt. of A.P.[6] and Harminder Singh  Arora  v.
Union of India[7]. These, however,  are  cases  where  the  writ  court  was
enforcing a statutory right or duty. These cases do  not  lay  down  that  a
writ court can interfere in a matter of contract only. Thus  on  the  ground
of maintainability the petition should have been dismissed”.

15.   Having referred to the aforesaid decisions, it is  obligatory  on  our
part to refer to two other authorities of  this  Court  where  it  has  been
opined that under what circumstances a disputed  question  of  fact  can  be
gone into.  In Gunwant Kaur v.  Municipal  Committee,  Bhatinda[8],  it  has
been held thus:-
“14. The High Court observed that they will not determine disputed  question
of fact in a writ petition. But what facts were in  dispute  and  what  were
admitted could only be determined after an affidavit-in-reply was  filed  by
the State. The High Court, however, proceeded to  dismiss  the  petition  in
limine. The High Court is not deprived of its jurisdiction  to  entertain  a
petition under Article 226 merely because in  considering  the  petitioner’s
right to relief questions of fact may fall to be determined. In  a  petition
under Article 226 the High Court has jurisdiction  to  try  issues  both  of
fact and law. Exercise of the jurisdiction is, it  is  true,  discretionary,
but the discretion must be exercised on sound judicial principles. When  the
petition raises questions of fact of a complex nature, which may  for  their
determination require oral evidence to be taken, and  on  that  account  the
High Court is of the view that the dispute may not  appropriately  be  tried
in a writ petition, the High Court may decline to try a petition.  Rejection
of a petition in limine will normally be justified, where the High Court  is
of the view that the petition is frivolous or because of the nature  of  the
claim made dispute sought to be agitated, or that the petition  against  the
party against whom relief  is  claimed  is  not  maintainable  or  that  the
dispute raised thereby is such that it would be inappropriate to try  it  in
the writ jurisdiction, or for analogous reasons.

15. From the averments made in the petition filed by the  appellants  it  is
clear that in proof of a large number of allegations the  appellants  relied
upon documentary evidence and the only matter in respect of  which  conflict
of  facts  may  possibly  arise  related  to  the  due  publication  of  the
notification under Section 4 by the Collector.

16. In the present case, in our judgment, the High Court was  not  justified
in dismissing the  petition  on  the  ground  that  it  will  not  determine
disputed question of fact. The High  Court  has  jurisdiction  to  determine
questions of fact, even if they are in  dispute  and  the  present,  in  our
judgment, is a case in which in the interests of both the parties  the  High
Court should have entertained the petition and called for  an  affidavit-in-
reply from the respondents, and should have proceeded to  try  the  petition
instead of relegating the appellants to a separate suit.”

                                                            [Emphasis added]

16.   In ABL International Ltd. v. Export Credit Guarantee Corpn.  of  India
Ltd.[9], a two-Judge Bench after referring to various judgments as  well  as
the pronouncement in Gunwant Kaur (supra) and  Century  Spg.  And  Mfg.  Co.
Ltd. v. Ulhasnagar Municipal Council[10], has held thus:-
“19.  Therefore, it is clear from the above enunciation of law  that  merely
because one of the parties to the litigation raises a dispute in  regard  to
the facts of the case, the court entertaining such  petition  under  Article
226 of the Constitution is not always bound to relegate  the  parties  to  a
suit. In the above case of Gunwant Kaur this Court even went to  the  extent
of holding that in  a  writ  petition,  if  the  facts  require,  even  oral
evidence can be taken. This clearly shows that in an appropriate  case,  the
writ court has the jurisdiction  to  entertain  a  writ  petition  involving
disputed questions of fact and there is no absolute bar for  entertaining  a
writ petition even if the  same  arises  out  of  a  contractual  obligation
and/or involves some disputed questions of fact.

                              xxxxx xxxxx xxxxx

27. From the above  discussion  of  ours,  the  following  legal  principles
emerge as to the maintainability of a writ petition:

(a) In an appropriate case, a  writ  petition  as  against  a  State  or  an
instrumentality of a State  arising  out  of  a  contractual  obligation  is
maintainable.

(b) Merely because some disputed questions of fact arise for  consideration,
same cannot be a ground to refuse to entertain a writ petition in all  cases
as a matter of rule.

(c) A writ petition involving a consequential relief of  monetary  claim  is
also maintainable.

      While laying down the principle, the Court sounded a word  of  caution
as under:-
“However, while entertaining an objection as to  the  maintainability  of  a
writ petition under Article 226 of the  Constitution  of  India,  the  court
should bear in mind the fact that  the  power  to  issue  prerogative  writs
under Article 226 of the Constitution  is  plenary  in  nature  and  is  not
limited by any other provisions of the Constitution. The High  Court  having
regard to the facts of the case, has a discretion to  entertain  or  not  to
entertain a writ  petition.  The  Court  has  imposed  upon  itself  certain
restrictions in the  exercise  of  this  power.  (See  Whirlpool  Corpn.  v.
Registrar of Trade Marks[11].) And this plenary right of the High  Court  to
issue a prerogative writ will not normally be exercised by the Court to  the
exclusion of other available remedies unless such action  of  the  State  or
its instrumentality is arbitrary and  unreasonable  so  as  to  violate  the
constitutional mandate of Article 14  or  for  other  valid  and  legitimate
reasons, for which the Court  thinks  it  necessary  to  exercise  the  said
jurisdiction”.

17.   It is appropriate to state here that  in  the  said  case,  the  Court
granted the relief as the facts were absolutely clear from  the  documentary
evidence brought which pertain  to  interpretation  of  certain  clauses  of
contract of insurance.  In that context, the Court opined:-
“.... The terms of the insurance contract  which  were  agreed  between  the
parties were after the terms of the contract between the  exporter  and  the
importer were executed  which  included  the  addendum,  therefore,  without
hesitation we must proceed on the basis that  the  first  respondent  issued
the insurance policy knowing very well that there was more than one mode  of
payment of consideration and it had insured failure  of  all  the  modes  of
payment of consideration. From the correspondence as well as from the  terms
of the policy, it is noticed that existence of only two conditions has  been
made as a condition precedent for making the  first  respondent  Corporation
liable to pay for the insured risk, that is: (i) there should be  a  default
on the part of the Kazak Corporation to pay  for  the  goods  received;  and
(ii) there should be a failure on the part of the Kazakhstan  Government  to
fulfil their guarantee”.

And it eventually held:-
“..... We have come to the conclusion that  the  amended  clause  6  of  the
agreement between the exporter and the importer on the face of it  does  not
give room for  a  second  or  another  construction  than  the  one  already
accepted by us. We have also noted that reliance placed  on  sub-clause  (d)
of the proviso to the insurance contract by  the  Appellate  Bench  is  also
misplaced which is clear from  the  language  of  the  said  clause  itself.
Therefore, in our opinion, it does not require any external aid,  much  less
any oral evidence to interpret the above clause. Merely  because  the  first
respondent wants to dispute this fact, in our opinion, it does not become  a
disputed  fact.  If   such   objection   as   to   disputed   questions   or
interpretations is raised in a writ petition, in  our  opinion,  the  courts
can very well go into the same and decide that  objection  if  facts  permit
the same as in this case”.

18.   In this regard, a reference  to  Noble  Resources  Ltd.  v.  State  of
Orissa and Another[12] would be seemly.  The  two-Judge  Bench  referred  to
the ABL International  (supra),  Dwarkadas  Marfatia  &  Sons  v.  Board  of
Trustees, Port of Bombay[13], Mahabir Auto Stores v.  Indian  Oil  Corp.[14]
and Jamshed Hormusji Wadia v. Board of  Trustees,  Port  of  Mumbai[15]  and
opined thus:-
“Although the scope of judicial review or the development  of  law  in  this
field has been  noticed  hereinbefore  particularly  in  the  light  of  the
decision of this Court in ABL International Ltd. each  case,  however,  must
be decided on its own facts. Public interest as  noticed  hereinbefore,  may
be one of the factors to exercise the power of judicial review.  In  a  case
where a public law element is involved, judicial review may be  permissible.
(See Binny Ltd. v. V. Sadasivan[16] and G.B. Mahajan  v.  Jalgaon  Municipal
Council[17].)”

19.   Thereafter, the court proceeded to analyse the facts and came to  hold
that  certain  serious  disputed  questions  of  facts   have   arisen   for
determination and such disputes ordinarily could not have  been  entertained
by the  High  Court  in  exercise  of  its  power  of  judicial  review  and
ultimately the appeal was dismissed.
20.   We have referred to the aforesaid authorities to highlight under  what
circumstances in respect of contractual claim or challenge to  violation  of
contract can be entertained by a writ court.  It depends upon facts of  each
case.  The issue that had arisen in ABL International (supra)  was  that  an
instrumentality of a State was  placing  a  different  construction  on  the
clauses of the contract of insurance and the insured  was  interpreting  the
contract differently.  The Court thought it apt merely because something  is
disputed by the insurer, it should not enter  into  the  realm  of  disputed
questions of fact.  In fact, there was no disputed question of fact, but  it
required  interpretation  of  the  terms  of  the  contract  of   insurance.
Similarly, if the materials that come on record from  which  it  is  clearly
evincible, the writ court may exercise the power of judicial review  but,  a
pregnant one,  in  the  case  at  hand,  the  High  Court  has  appointed  a
Commission to collect the evidence, accepted the same  without  calling  for
objections from the respondent and  quashed  the  order  of  termination  of
contract.  The procedure adopted by the High Court, if we  permit  ourselves
to say so, is quite unknown to exercise of powers under  Article  226  in  a
contractual matter.  We can well appreciate a Committee being  appointed  in
a Public Interest Litigation to assist the Court  or  to  find  out  certain
facts.  Such an exercise is meant for public good and  in  public  interest.
For example, when an issue arises whether in a particular  State  there  are
toilets for school children and there is an  assertion  by  the  State  that
there are good toilets, definitely the Court  can  appoint  a  Committee  to
verify the same.  It is because the lis is not adversarial in  nature.   The
same principle cannot be taken recourse  to  in  respect  of  a  contractual
controversy.   It  is  also  surprising  that  the  High  Court   has   been
entertaining series of writ petitions at the  instance  of  the  respondent,
which is nothing but abuse of the process of extraordinary  jurisdiction  of
the High Court.  The Appellate Bench should have applied more restraint  and
proceeded in accordance with law instead of making a roving  enquiry.   Such
a step is impermissible and by  no  stretch  of  imagination  subserves  any
public interest.
21.   Consequently, the appeal is allowed and the judgment and order  passed
by  the  Appellate  Bench  is  set  aside.   However,  in  the   facts   and
circumstances of the case, we refrain from imposing costs.

                                             .............................J.
                                                               [Dipak Misra]



                                             ..........................., J.
                                                          [Prafulla C. Pant]
New Delhi
August 14, 2015

-----------------------
[1]     (2002) 1 SCC 216
[2]     (2003) 7 SCC 410
[3]     (2000) 6 SCC 293
[4]     (1996) 6 SCC 22
[5]     (1989) 2 SCC 116
[6]     (2001) 8 SCC 344
[7]     (1986) 3 SCC 247
[8]     (1969) 3 SCC 769
[9]     (2004) 3 SCC 553
[10]    (1970) 1 SCC 582
[11]    (1998) 8 SCC 1
[12]    (2006) 10 SCC 236
[13]    (1989) 3 SCC 293
[14]    (1990) 3 SCC 752
[15]    (2004) 3 SCC 214
[16]    (2005) 6 SCC 657
[17]    (1991) 3 SCC 91

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