1 CGHC010258032021 2026:CGHC:30884-DB NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 4037 of 2021 1 - Rajat Kumar Singh S/o Late Shri Devnandan Singh Aged About 38 Years R/o Devnandan Nagar, Sarkanda, Bilaspur Tahsil And District Bilaspur Chhattisgarh., District : Bilaspur, Chhattisgarh ... Petitioner(s) versus 1 - State Of Chhattisgarh Through Secretary, Local Administration And Development Department, Atal Nagar, Mahanadi Bhawan, New Raipur, Rapur Chhattisgarh., District : Raipur, Chhattisgarh 2 - Nagar Panchayat Bodri Through Chief Municipal Officer, District Bilaspur Chhattisgarh., District : Bilaspur, Chhattisgarh 3 - Sub Engineer Nagar Panchayat Bodri, District Bilaspur Chhattisgarh., District : Bilaspur, Chhattisgarh ... Respondent(s) (Cause title taken from Case Information System) For Petitioner(s) :Mr. Ravindra Sharma, Advocate. For State/Respondent No. 1 :Mr. Soumya Rai, Dy. Govt. Advocate. For Respondent No. 2 and 3 :Mr. Sudeep Agrawal, Advocate. Hon'ble Shri Ramesh Sinha, Chief Justice Hon'ble Shri Ravindra Kumar Agrawal, Judge Order on Board Per Ramesh Sinha, Chief Justice 21/07/2026 1. Heard Mr. Ravindra Sharma, learned counsel for the petitioner. Also heard Mr. Soumya Rai, learned Dy. Govt. Advocate, appearing for the State/Respondent No. 1, Mr. Sudeep Agrawal, learned counsel for the ALOK SHARMA Digitally signed by ALOK SHARMA Date: 2026.07.24 11:19:48 +0530 2 Respondent No. 2 and 3. 2. By this petition under Article 226 of the Constitution of India, the petitioner seek for the following relief(s): “10.1 That this Hon'ble court may kindly be pleased to issue a writ of 'MANDAMUS' directing the respondent No. 02 to consider the representation of the petitioner and may kindly be pleased to direct the respondent authorities to release the amount expend by the petitioner in construction work. 10.2 That this Hon'ble court may kindly be pleased to issue any writ or direction or order as deem fit in the interest of justice.” 3. The brief facts of the case that the petitioner is a registered civil contractor, participated in the tender process initiated by respondent No.2, Nagar Panchayat Bodri, pursuant to the tender notice dated 31.08.2019 for construction of a C.C. Road under the Infrastructure Head. Being the lowest bidder, the petitioner's bid was accepted, whereupon a resolution dated 14.10.2019 was passed and a work order dated 30.10.2019 was issued for execution of the work valued at Rs. 10.54 lakhs. The petitioner completed the construction within the stipulated period, and the work was duly inspected, measured, and certified as completed by the competent authorities. However, despite successful execution of the work and submission of the bills, the contractual amount has not been released. The respondents subsequently informed the petitioner that permission for disbursement of the sanctioned amount had been declined by the State Government on the ground that the earlier work pertaining to the financial year 2017-18 had been cancelled. The petitioner contends that the work was awarded under a fresh tender issued in 2019 after cancellation of the earlier tender, and therefore, withholding the 3 payment for a duly executed and certified work on account of an internal administrative decision is arbitrary and illegal. Aggrieved by the continued non-payment of his legitimate dues despite repeated representations, the petitioner has preferred the present writ petition seeking release of the outstanding amount. 4. Learned counsel for the petitioner submits that the petitioner was awarded the work pursuant to a valid tender process and, in compliance with the work order issued by respondent No.2, duly executed the construction work within the stipulated period after obtaining all necessary approvals and sanctions. It is submitted that the work was inspected by the competent authorities, measurements were duly recorded, and a completion certificate was issued acknowledging satisfactory execution of the work. Despite completion and certification of the work, the respondents have failed to release the legitimate contractual dues of the petitioner without any justifiable reason. It is further submitted that the petitioner has made several representations seeking release of the payment; however, no action has been taken by the respondents. Learned counsel contends that the withholding of the petitioner's dues on account of internal administrative or official issues of the respondents is wholly arbitrary, illegal, and unsustainable in law, particularly when the petitioner has duly discharged his contractual obligations. It is, therefore, prayed that this Court may direct the respondents to release the outstanding payment along with all consequential benefits within a stipulated time. 5. On the other hand, learned counsel for the respondent-State submits that the present writ petition is not maintainable as the petitioner has failed to challenge the order dated 01.07.2020 passed by the State Government, 4 whereby the proposal for release of payment was rejected, as well as the Government Circulars dated 03.06.2019 and 20.06.2019 governing the execution of such works. It is submitted that in terms of the circular dated 03.06.2019, all sanctioned works which had not commenced stood cancelled, and the subsequent circular dated 20.06.2019 mandated that any such cancelled work could be undertaken only after obtaining prior approval from the Directorate of Urban Administration and Development/State Urban Development Agency. Learned State counsel contends that although the Nagar Panchayat floated the fresh tender, accepted the petitioner's bid, and issued the work order, the mandatory prior approval contemplated under the aforesaid circulars was never obtained. Consequently, the State Government rightly rejected the proposal for release of funds by order dated 01.07.2020. It is further submitted that the petitioner completed the work with full knowledge of the applicable Government policy, yet approached this Court belatedly without explaining the delay. Therefore, in the absence of any challenge to the rejection order or the governing circulars, and there being no illegality in the action of the State Government, the present writ petition deserves to be dismissed. 6. Learned counsel appearing for respondent Nos. 2 and 3 submits that the Nagar Panchayat had duly floated the Notice Inviting Tender (NIT) for the construction work, pursuant to which the petitioner's bid, being the lowest (L- 1), was accepted by the President-in-Council, and a work order dated 30.10.2019 was issued in his favour. It is submitted that the petitioner completed the work on 26.12.2019, whereafter respondent Nos. 2 and 3 forwarded the proposal to the Directorate of Urban Administration and Development, State of Chhattisgarh, seeking approval for release of 5 payment. However, the proposal was rejected by the State Government vide order dated 01.07.2020. Learned counsel submits that respondent Nos. 2 and 3 have taken all necessary steps within their authority and the non- release of payment is solely on account of the decision of the State Government. It is further submitted that the petitioner has not challenged the aforesaid rejection order dated 01.07.2020, and therefore no effective relief can be granted in the present writ petition against respondent Nos. 2 and 3. Accordingly, it is prayed that the writ petition, insofar as these respondents are concerned, deserves to be dismissed. 7. We have learned counsel for the parties, perused the material annexed with the petition. 8. The Hon’ble Supreme Court in the case of Tata Motors Limited v The Brihan Mumbai Electric Supply & Transport Undertaking (Best) and Others passed in Civil Appeal No. 3897 of 2023 vide judgment dated 19.05.2023 held as follows : “48. This Court being the guardian of fundamental rights is duty-bound to interfere when there is arbitrariness, irrationality, mala fides and bias. However, this Court has cautioned time and again that courts should exercise a lot of restraint while exercising their powers of judicial review in contractual or commercial matters. This Court is normally loathe to interfere in contractual matters unless a clear-cut case of arbitrariness or mala fides or bias or irrationality is made out. One must remember that today many public sector undertakings compete with the private industry. The contracts entered into between private parties are not subject to scrutiny under writ jurisdiction. No doubt, the bodies which are State within the meaning of Article 12 of the Constitution are bound to act fairly and are amenable to the writ jurisdiction of superior courts but this discretionary power must be exercised with a great deal of restraint and caution. The courts must realise their limitations and the havoc which needless interference in 6 commercial matters can cause. In contracts involving technical issues the courts should be even more reluctant because most of us in Judges' robes do not have the necessary expertise to adjudicate upon technical issues beyond our domain. The courts should not use a magnifying glass while scanning the tenders and make every small mistake appear like a big blunder. In fact, the courts must give “fair play in the joints” to the government and public sector undertakings in matters of contract. Courts must also not interfere where such interference will cause unnecessary loss to the public exchequer. (See: Silppi Constructions Contractors v. Union of India, (2020) 16 SCC 489). 52. Ordinarily, a writ court should refrain itself from imposing its decision over the decision of the employer as to whether or not to accept the bid of a tenderer unless something very gross or palpable is pointed out. The court ordinarily should not interfere in matters relating to tender or contract. To set at naught the entire tender process at the stage when the contract is well underway, would not be in public interest. Initiating a fresh tender process at this stage may consume lot of time and also loss to the public exchequer to the tune of crores of rupees. The financial burden/implications on the public exchequer that the State may have to meet with if the Court directs issue of a fresh tender notice, should be one of the guiding factors that the Court should keep in mind. This is evident from a three-Judge Bench decision of this Court in Association of Registration Plates v. Union of India and Others, reported in (2005) 1 SCC 679. 53. The law relating to award of contract by the State and public sector corporations was reviewed in Air India Ltd. v. Cochin International Airport Ltd., reported in (2000) 2 SCC 617 and it was held that the award of a contract, whether by a private party or by a State, is essentially a commercial transaction. It can choose its own method to arrive at a decision and it is free to grant any relaxation for bona fide reasons, if the tender conditions permit such a relaxation. It was further held that the State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision-making process, the court must exercise its discretionary powers under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the 7 making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should interfere. 54. As observed by this Court in Jagdish Mandal v. State of Orissa and Others, reported in (2007) 14 SCC 517, that while invoking power of judicial review in matters as to tenders or award of contracts, certain special features should be borne in mind that evaluations of tenders and awarding of contracts are essentially commercial functions and principles of equity and natural justice stay at a distance in such matters. If the decision relating to award of contract is bona fide and is in public interest, courts will not interfere by exercising powers of judicial review even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. Power of judicial review will not be invoked to protect private interest at the cost of public interest, or to decide contractual disputes.” 9. It is trite law that writ jurisdiction is not intended to supplant ordinary civil remedies, particularly in matters involving contractual disputes requiring adjudication of complex and disputed questions of fact. In "State of Bihar v. Jain Plastics and Chemicals Ltd.", 2002 (1) SCC 216, the Hon'ble Supreme Court has held that where the claim arises out of breach of contract and involves disputed facts, the appropriate remedy lies in a civil suit and not in a writ petition. In paragraph 7, it has been observed that:- “7. In the present case 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 8 properly instituted civil suit rather than by a court exercising prerogative of issuing writs.” 10. Though in "ABL International Ltd. v. Export Credit Guarantee Corporation of India Ltd.", 2004 (3) SCC 553, the Hon'ble Apex Court recognized that a writ petition may be maintainable in contractual matters in limited circumstances, it was clearly observed that such jurisdiction is to be exercised where the facts are undisputed or where the State action is patently arbitrary, unreasonable, or in violation of Article 14. The present case does not fall within such an exception, as the very substratum of the petitioner's claim is contested. 11. The Hon'ble Supreme Court in "Joshi Technologies International Inc. v. Union of India", 2015 (7) SCC 728, where adjudication involves serious factual controversies necessitating evidence, the writ court should decline to exercise jurisdiction and relegate the parties to appropriate forums. In paragraphs 69 and 70, the legal position has been summarised that:- “69. The position thus summarised in the aforesaid principles has to be understood in the context of discussion that preceded which we have pointed out above. As per this, no doubt, there is no absolute bar to the maintainability of the writ petition even in contractual matters or where there are disputed questions of fact or even when monetary claim is raised. At the same time, discretion lies with the High Court which under certain circumstances, it can refuse to exercise. It also follows that under the following circumstances, "normally", the Court would not exercise such a discretion: 69.1. The Court may not examine the issue unless the action has some public law character attached to it. 69.2. Whenever a particular mode of settlement of dispute is provided in the contract, the High Court would refuse to exercise its discretion under Article 226 of the Constitution and relegate the party to the said mode of settlement, particularly when settlement of disputes is to be resorted to through the means of arbitration. 9 69.3. If there are very serious disputed questions of fact which are of complex nature and require oral evidence for their determination. 69.4. Money claims per se particularly arising out of contractual obligations are normally not to be entertained except in exceptional circumstances. 70. Further, the legal position which emerges from various Judgments of this Court dealing with different situations/aspects relating to contracts entered into by the State/public authority with private parties, can be summarised as under: 70.1. At the stage of entering into a contract, the State acts purely in its executive capacity and is bound by the obligations of fairness. 70.2. State in its executive capacity, even in the contractual field, is under obligation to act fairly and cannot practise some discriminations. 70.3. Even in cases where question is of choice or consideration of competing claims before entering into the field of contract, facts have to be investigated and found before the question of a violation of Article 14 of the Constitution could arise. If those facts are disputed and require assessment of evidence the correctness of which can only be tested satisfactorily by taking detailed evidence, involving examination and cross-examination of witnesses, the case could not be conveniently or satisfactorily decided in proceedings under Article 226 of the Constitution. In such cases the Court can direct the aggrieved party to resort to alternate remedy of civil suit, etc. 70.4. Writ jurisdiction of the High Court under Article 226 of the Constitution was not intended to facilitate avoidance of obligation voluntarily incurred. 70.5. Writ petition was not maintainable to avoid contractual obligation. Occurrence of commercial difficulty, inconvenience or hardship in performance of the conditions agreed to in the contract can provide no justification in not complying with the terms of contract which the parties had accepted with open eyes. It cannot ever be that a licensee can work out the licence if he finds it profitable to do so: and he can challenge the conditions under which he agreed to take the licence, if he finds it commercially inexpedient to conduct his business. 10 70.6. Ordinarily, where a breach of contract is complained of, the party complaining of such breach may sue for specific performance of the contract, if contract is capable of being specifically performed. Otherwise, the party may sue for damages. 70.7. Writ can be issued where there is executive action unsupported by law or even in respect of a corporation there is denial of equality before law or equal protection of law or if it can be shown that action of the public authorities was without giving any hearing and violation of principles of natural justice after holding that action could not have been taken without observing principles of natural justice. 70.8. If the and the contract between private party State/instrumentality and/or agency of the State is under the realm of a private law and there is no element of public law, the normal course for the aggrieved party, is to invoke the remedies provided under ordinary civil law rather than approaching the High Court under Article 226 of the Constitution of India and Invoking its extraordinary jurisdiction. 70.9. The distinction between public law and private law element in the contract with the State is getting blurred. However, it has not been totally obliterated and where the matter falls purely in private field of contract, this Court has maintained the position that writ petition is not maintainable. The dichotomy between public law and private law rights and remedies would depend on the factual matrix of each case and the distinction between the public law remedies and private law field, cannot be demarcated with precision. In fact, each case has to be examined, on its facts whether the contractual relations between the parties bear insignia of public element. Once on the facts of a particular case it is found that nature of the activity or controversy involves public law element, then the matter can be examined by the High Court in writ petitions under Article 226 of the Constitution of India to see whether action of the State and/or instrumentality or agency of the State is fair, just and equitable or that relevant factors are taken into consideration and irrelevant factors have not gone into the decision-making process or that the decision is not arbitrary. 70.10. Mere reasonable or legitimate expectation of a citizen, in such a situation, may not by itself be a distinct enforceable right, but failure to consider and give due weight to it may render the decision arbitrary, and this is how the requirements of due consideration of a legitimate expectation forms part of 11 the principle of non-arbitrariness. 70.11. The scope of judicial review in respect of disputes falling within the domain of contractual obligations may be more limited and in doubtful cases the parties may be relegated to adjudication of their rights by resort to remedies provided for adjudication of purely contractual disputes.” 12. Having heard learned counsel for the parties and upon perusal of the material available on record, this Court finds that the grievance of the petitioner pertains to non-release of the contractual amount for the work executed pursuant to the work order dated 30.10.2019. It is, however, evident from the record that the proposal for release of payment was rejected by the State Government vide order dated 01.07.2020 on the basis of the Government Circulars dated 03.06.2019 and 20.06.2019. Admittedly, neither the said rejection order nor the aforesaid circulars have been challenged by the petitioner in the present writ petition. In the absence of any challenge to the very foundation of the respondents' action, no effective direction for release of payment can be issued by this Court. 13. The dispute raised by the petitioner essentially emanates from a contractual relationship and involves a claim for payment under the contract. The adjudication of such a claim would necessarily require examination of disputed questions of fact, including the applicability and effect of the Government Circulars, the requirement of prior approval before issuance of the work order, and the legality of the rejection order dated 01.07.2020. Such issues require appreciation of evidence and cannot be conveniently adjudicated in proceedings under Article 226 of the Constitution of India. 14. The legal position governing the exercise of writ jurisdiction in contractual matters is well settled. The Hon'ble Supreme Court in State of Bihar v. Jain Plastics and Chemicals Ltd., ABL International Ltd. v. 12 Export Credit Guarantee Corporation of India Ltd., Joshi Technologies International Inc. v. Union of India, and Tata Motors Limited v. Brihan Mumbai Electric Supply & Transport Undertaking (BEST) has consistently held that writ jurisdiction should ordinarily not be invoked for adjudication of contractual disputes involving monetary claims and disputed questions of fact, except where the action of the State is ex facie arbitrary, mala fide or violative of Article 14 of the Constitution. No such exceptional circumstance has been demonstrated in the present case warranting interference by this Court. 15. In view of the aforesaid discussion, this Court is of the considered opinion that the present writ petition is not maintainable in its present form. The petitioner is at liberty to avail such remedy as may be available to him in accordance with law before the appropriate forum for adjudication of his claim. 16. Accordingly, the writ petition is dismissed. No order as to costs. Sd/- Sd/- (Ravindra Kumar Agrawal) (Ramesh Sinha) Judge Chief Justice Alok