CGHC010265592026 2026:CGHC:31875-DB NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 3760 of 2026 Harsh Industries Through Its Proprietor, Naveen Shrivastav, S/o R.K. Shrivastav, Aged About 47 Years Of Age, House No. BG- 23, Rajiv Plaza, Near Old Bus Stand, Tehsil And Dist. Bilaspur, C.G. 495001 ... Petitioner(s) versus 1 - State Of Chhattisgarh Through The Principal Secretary To The Government Of Chhattisgarh, Department Of Urban Administration And Development, Mantralay, Indravati Bhawan, Atal Nagar, Naya Raipur, C.G. 2 - Director Department Of Urban Administration And Development, Govt. Of Chhattisgarh, Atal Nagar, Naya Raipur, Chhattisgarh- 492001 3 - Collector And District Magistrate Collector Marg, Chandra Nagar Colony, Raigarh, Chhattisgarh- 496001 4 - Commissioner Municipal Corporation, Town Hall Rd., Raigarh, C.G. 496001 5 - Director Procurement Policy Division, Government Of India, Ministry Of Finance, Department Of Expenditure Procurement Policy Division, New Delhi Room No. 76, Pin- 110001 ...Respondent(s) (Cause-title taken from Case Information System) ------------------------------------------------------------------------------------------------------------------ For Petitioner : Shri Avadhesh Mishra, Advocate For State : Shri Soumya Rai, Dy GA For Respondent-4 : Shri Pankaj Agrawal, Advocate For Respondent-5 : Shri RD Singh, DSGI --------------------------------------------------------------------------------------------------------- Hon'ble Shri Ramesh Sinha, Chief Justice Hon'ble Shri Justice Ravindra Kumar Agrawal Order on Board Per Ramesh Sinha, Chief Justice 27.07.2026 Wpc 3760 of 2026 2 Heard Shri Avadhesh Mishra, learned counsel for the petitioner. Also heard Shri Soumya Rai, learned Dy GA for the State, Shri Pankaj Agrawal, learned counsel for respondent-4, and Shri RD Singh, learned DSGI for respondent-5. 1. Present petition has been filed with the following prayers: “1. The Hon’ble Court may kindly be pleased to direct the concerned respondent No.4 to release the payment immediately with due interest. 2. The Hon’ble Court may kindly be pleased to direct the concerned respondent No.4 to pay compensation to the Petitioner an amount of 1 lac of rupees for the financial and mental harassment caused to him and the cost of the case. 3. Any other relief which Hon’ble Court feels deem and proper, may also be passed in favour of the petitioner.” 2. Brief facts of the case, are that the petitioner was awarded a GeM contract bearing No.511687707004189 dated 25.01.2020 for supply of Ferric Alum to the Municipal Corporation, Raigarh. According to the petitioner, pursuant to the contract, material was supplied through two invoices dated 06.02.2020 and 07.02.2020. Initially, the respondents did not release payment on the ground that the supplied material appeared to be sub- standard and that the requisite quality test report had not been furnished. Thereafter, at the request of the petitioner, samples were sent for laboratory testing and a test report dated 04.02.2021 was obtained and submitted before the respondent authorities on 17.02.2021. It is the case of the petitioner that after receipt of the test report, Consignee Receipt and Acceptance Certificates (CRACs) dated 22.02.2021 were generated Wpc 3760 of 2026 3 recording "Rejected Quantity – 0", thereby accepting the entire supplied material. 3. It is further pleaded that despite issuance of the CRACs and despite repeated representations and legal notice, the respondents failed to release payment. Earlier, the petitioner approached this Court by filing WPC No.599 of 2023, which was disposed of on 21.01.2025 with a direction to the Municipal Corporation to resolve the dispute in accordance with Clause 16 of the General Terms and Conditions of GeM. Pursuant thereto, the petitioner submitted a representation and participated in the proceedings before the Commissioner. However, instead of deciding the claim for payment, the Commissioner issued the impugned communication dated 25.07.2025 directing the petitioner to collect fresh samples from the respondent's filter plant and submit a fresh laboratory test report before the claim for payment could be considered. Aggrieved thereby, the petitioner has preferred the present writ petition. 4. Learned counsel for the petitioner submits that once the respondents themselves generated the CRACs showing "Rejected Quantity – 0", the material supplied by the petitioner stood duly accepted and there remained no justification for withholding payment. It is contended that the respondents accepted the laboratory test report submitted in February, 2021 and thereafter, generated the CRACs after due verification but nearly after six years, impugned letter dated 25.07.2025 was issued to the petitioner by the Commissioner, Municipal corporation, Raigarh to furnish a fresh laboratory test report by collecting fresh samples, is wholly arbitrary, unreasonable and Wpc 3760 of 2026 4 contrary to the contractual record. Learned counsel further submits that the impugned communication is in complete disregard of the earlier order passed by this Court in WPC No.599 of 2023 directing the respondents to resolve the dispute under Clause 16 of the GeM General Terms and Conditions. It is also argued that in view of the Office Memorandum dated 03.07.2020 issued by the Ministry of Finance, Government of India, payment ought to have been released within ten days from generation of the CRACs. Therefore, the petitioner is entitled to release of payment together with interest and appropriate compensation. 5. Per contra, learned counsel appearing for the respondents/State, as well as other respondents jointly oppose the writ petition and submit that the dispute raised by the petitioner arises purely out of contractual obligations under the GeM contract and involves disputed questions relating to quality verification, acceptance of material and entitlement to payment. It is submitted that the impugned communication has been issued only as part of the process of verification pursuant to the earlier direction of this Court and no final decision rejecting the petitioner's claim has yet been taken. It is further submitted that adjudication of the petitioner's claim would necessarily require examination of contractual records, technical material and evidence regarding quality of supplies, which cannot be undertaken in exercise of writ jurisdiction under Article 226 of the Constitution. Learned counsel, therefore, submits that the petitioner has an efficacious remedy under the dispute resolution mechanism provided in the contract as well as under ordinary civil law and, therefore, the present writ petition is liable to be dismissed. Wpc 3760 of 2026 5 6. We have heard learned counsel for the parties and perused the material available on record. 7. 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 Wpc 3760 of 2026 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). xxxxxxxx 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 Wpc 3760 of 2026 7 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 making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether Wpc 3760 of 2026 8 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.” 8. 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 Wpc 3760 of 2026 9 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 properly instituted civil suit rather than by a court exercising prerogative of issuing writs.” 9. 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. Wpc 3760 of 2026 10 10. 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. Wpc 3760 of 2026 11 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 Wpc 3760 of 2026 12 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. 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 Wpc 3760 of 2026 13 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 Wpc 3760 of 2026 14 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 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.” 11. The controversy involved in the present case, admittedly, arises out of a contract executed between the petitioner and the Municipal Corporation for supply of Ferric Alum through the GeM portal. The grievance of the petitioner essentially relates to non-release of payment under the contract and challenge to the communication dated 25.07.2025, whereby the petitioner has been asked to furnish a fresh laboratory test Wpc 3760 of 2026 15 report before the claim for payment is considered. The respondents, on the other hand, dispute the petitioner's entitlement and contend that verification of quality and compliance with contractual requirements are still necessary before any payment can be released. Thus, the controversy cannot be decided merely on the basis of pleadings but would require examination of contractual documents, technical records and factual aspects concerning acceptance of the material supplied. 12. It is well settled that although the jurisdiction of this Court under Article 226 of the Constitution is wide, the same is ordinarily not exercised for adjudication of contractual disputes involving disputed questions of fact or monetary claims arising out of contracts. Such disputes are ordinarily required to be adjudicated before the forum contemplated under the contract or before the competent civil court. Judicial review in contractual matters is confined to cases involving patent arbitrariness, mala fides or violation of constitutional or statutory obligations and not to determination of disputed contractual rights requiring appreciation of evidence. 13. In the present case, the petitioner's claim for release of payment is seriously disputed by the respondents and the issue is intertwined with contractual obligations, technical verification and factual determination regarding acceptance of the supplied material. Whether the petitioner became entitled to payment solely on the basis of the CRACs or whether further verification could legally be insisted upon are matters which require detailed examination of contractual terms and evidence. Such issues cannot Wpc 3760 of 2026 16 appropriately be adjudicated in proceedings under Article 226 of the Constitution. 14. In view of the legal principles laid down by the Hon’ble Supreme Court in Tata Motors Limited (supra), State of Bihar (supra), ABL International Ltd. (supra), and Joshi Technologies International Inc. (supra), this Court is of the considered opinion that the present writ petition is not maintainable for adjudication of the claim involved herein and the petitioner is at liberty to avail such remedy as may be available to him under law before the appropriate forum. 15. Accordingly, the present writ petition is hereby dismissed. No order as to costs. Sd/- Sd/- (Ravindra Kumar Agrawal) (Ramesh Sinha) Judge Chief Justice padma Digitally signed by V PADMAVATHI Date: 2026.07.30 11:23:04 +0530