1 2026:CGHC:16346-DB NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 1744 of 2020 1 - M/s Niranjan Lal Agrawal A Proprietorship Firm Having its Office At Tulsi Marg, Korba, Through its Sole Proprietor Raj Agrawal, S/o Late Niranjan Lal Agrawal, Aged 38 Years, R/o House No. 3, Tulsi Marg, Korba, District Korba Chhattisgarh, District : Korba, Chhattisgarh ... Petitioner versus 1 - South Eastern Coalfiedls Limited A Miniratna Company Subsidiary of Coal India Limited, Through its Chairman-Cum-Managing Director, SECL Bhawan, Seepat Road, Sarkanda, Bilaspur, District Bilaspur Chhattisgarh, District : Bilaspur, Chhattisgarh 2 - Chief General Manager, South Eastern Coalfields Limited, Bishrampur Area, Aamgaon Colliery, Tahsil Bishrampur, District Surguja Chhattisgarh, District : Surguja (Ambikapur), Chhattisgarh 3 - General Manager, South Eastern Coalfields Limited, Bishrampur Area, Aamgaon Colliery, Tahsil Bishrampur District Surguja Chhattisgarh, District : Surguja (Ambikapur), Chhattisgarh 4 - Sub Area Manager/ Engineer- In-Charge, South Eastern Coalfields Limited, Aamgaon Sub- Area, Bishrampur Area, Aamgaon Colleriy, Tahsil Bishrampur, District Surguja Chhattisgarh, District : Surguja (Ambikapur), Chhattisgarh ... Respondents (Cause-title taken from Case Information System) Digitally signed by MOHAMMED AADIL KHAN Date: 2026.04.13 20:20:06 +0530 2 For Petitioner : Mr. Manoj Paranjpe, Senior Advocate with Mr. A.D. Diwan, Advocate. For Respondents/SECL : Mr. Vivek Verma, Advocate. Hon'ble Shri Ramesh Sinha, Chief Justice Hon'ble Shri Ravindra Kumar Agrawal, Judge Order on Board Per Ramesh Sinha, Chief Justice 09-04-2026 1. By this petition under Article 226 of the Constitution of India, the petitioners seek for the following relief(s): “10.1 The Hon'ble Court may kindly be pleased to call for the entire records leading to passing of the impugned order Annexure P-1, for the kind perusal of this Hon'ble Court. 10.2 The Hon'ble Court may further kindly be pleased to quash the order impugned Annexure P-1 dated 09/10.04.2020 passed by the respondent No.1. 10.3 The Hon'ble Court may also kindly be pleased to direct the respondents to pay an amount of Rs.64,02,397-11 ps. along with interest at the rate of 18% per annum from the date of issuance of work order i.e. 17.08.2014 till the date of actual release. 3 10.4 Any other relief(s)/ order(s)/ direction(s) in favour of petitioner, which this Hon'ble Court may deem fit and proper in the facts and circumstances of the case, in the interest of justice. 10.5 Cost of the petition.” 2. The brief facts of the case are that, the petitioner has filed the present writ petition challenging the order dated 09/10.04.2020, whereby the respondent imposed a recovery of Rs.6,06,13,763.96. The respondent had floated a tender on 28.01.2014, and the petitioner, being the successful bidder, was awarded the work. Although the petitioner commenced the work and had already deposited the requisite earnest money, bank guarantee, and performance security, no formal agreement was executed between the parties. Subsequently, disputes arose, leading to termination of the petitioner’s work, and the respondent re-tendered parts of the same work at the petitioner’s risk and cost. The petitioner contends that the impugned recovery order is arbitrary and illegal, as it was passed without properly considering the petitioner’s objections and in violation of earlier court directions requiring a reasoned (speaking) order. It is further alleged that the recovery has been calculated by invoking contractual clauses, including Clause 9.2(b) of the general terms and conditions, which were not in existence at the time of the tender, thereby resulting in unjust and double penalization. The petitioner also alleges mala fide conduct on the part of the respondent, highlighting that multiple tenders for the 4 same work were issued shortly after awarding it to the petitioner, and that the respondent failed to execute the agreement despite the petitioner’s readiness. It is argued that in the absence of a formal agreement, the respondent could not impose such a substantial recovery and was at best entitled to forfeit the earnest money. Aggrieved by these actions, the petitioner has approached the Court seeking quashing of the impugned order. 3. Learned counsel appearing on behalf of the petitioner submits that the impugned order dated 09/10.04.2020 is wholly unsustainable in law, being arbitrary, unreasoned, and in direct violation of the directions issued by this Hon’ble Court in W.P.(C) No.338/2017. The Court had categorically directed the respondents to explain the accounts, consider the petitioner’s objections, and thereafter pass a reasoned and speaking order. However, the respondents have failed to deal with the petitioner’s objections and have passed the impugned order without assigning any reasons, thereby violating the principles of natural justice. On this ground alone, the impugned order deserves to be set aside. It is further submitted that the very basis of the recovery is erroneous and contrary to the contractual terms. The respondents have invoked Clause 9.2(b) of the general terms and conditions, which admittedly did not exist at the time of issuance of the tender, and have simultaneously applied Clause 9.6 of the same, resulting in impermissible double penalization. The calculation of the recovery amount is arbitrary and inflated, including unjustified additions such as diesel price escalation, which is not applicable in the petitioner’s case and is inconsistent with 5 the treatment given to other contractors. Such action is clearly discriminatory and violative of Article 14 of the Constitution. Moreover, the conduct of the respondents is vitiated by mala fide intent. Despite the petitioner’s readiness, the respondents failed to execute the agreement and, in the meantime, issued multiple tenders for the same work, ultimately terminating the petitioner’s contract. In the absence of a concluded agreement, the respondents could not have imposed such a drastic penalty and were at best entitled to forfeit the earnest money as per the tender conditions. The respondents have also taken inconsistent stands regarding the alleged dues, which further demonstrates arbitrariness. In light of these facts, the impugned order is liable to be quashed. 4. On the other hand, learned counsel for the SECL/respondents opposes the submissions made by the learned counsel for the petitioner and submits that, the dispute herein arises purely out of contractual obligations under a tender agreement, involving disputed questions of fact regarding completion, quality, measurement and verification of work, which cannot be adjudicated in writ jurisdiction under Article 226 of the Constitution. It is a settled principle that writ courts should not ordinarily interfere in contractual matters where efficacious alternative remedies such as arbitration or civil suit are available. He further submits that as there is no arbitrary or mala fide action on part of the respondents but only a procedural and contractual compliance requirement, hence, the present writ petition seeking monetary relief is not maintainable and is liable to be dismissed. 6 5. We have learned counsel for the parties, perused the material annexed with the petition. 6. 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 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 7 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 making out of a legal point. The court should always keep the larger public interest in mind in order to decide 8 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.” 7. Upon perusal of the judgment passed by the Hon’ble Supreme Court in Tata Motors Limited (Supra), as the Apex Court has categorically held that judicial review in contractual and tender matters must be exercised with great restraint and only in cases where clear arbitrariness, mala fides, bias or irrationality is demonstrated, in the present case, no such exceptional circumstance is made out, and the dispute raised by the petitioner pertains purely to recovery of alleged contractual dues, which involves factual determination regarding part of completion of work, compliance of contractual conditions, measurements and verification, and therefore falls within the domain of a civil dispute. The scope of judicial review in contractual and tender matters is limited and the Court ordinarily does not interfere unless the 9 decision-making process is found to be arbitrary, irrational or contrary to law, which is not established in the present case. Hence, in light of the settled legal position, the present petition seeking quashment of recovery order under a contract is misconceived, devoid of merit, and liable to be dismissed, leaving the petitioner to avail appropriate alternative remedies available under law. 8. Therefore, the present petition being devoid of merits deserves to be and is hereby dismissed. Sd/- Sd/- (Ravindra Kumar Agrawal) (Ramesh Sinha) Judge Chief Justice Aadil