KONDURI BUCHI RAJALINGAM Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) This petition is filed under Article 226 of the Constitution for the issue of a Writ of Certiorari or any other order or direction calling for the records and to quash the orders of the Government dated 4-3-63 and 7-2-63 directing the Respondents not to collect a sum of Rs. 1.26,974.00 nP or any other amount under the purchase contract dated 8-1-57 or under the cleansing agreement of 1955, by way of sale of the properties of the petitioner. Subsequent to the filing of the petition, the petitioner died and his legal representatives, petitioners 2 and 3 were brought on record.

(2.) The facts as stated by the petitioner are as follows: The petitioner was the owner of a Rice Mill at Jammikunta, Karimnagar District He was milling paddy of the Government under various terms in accordance with the prevailing market rates. There was no specific contract between him and the Government and the Government used to entrust him with stocks of paddy whenever they wanted the stocks to be milled and he used to deliver stocks after milling the paddy. In 1955, the Government wanted the petitioner to cleanse large stocks of dirty and damaged rice stuff which was practically rubbish and the useful and consumable quantity was hardly 20 to 30 per cent. Much of the stock contained bran, dust, husk and sand and the petitioner was to winnow and after cleansing it put it in bags. In the circumstances, it was found risky to stipulate any fixed rates or terms as there was no knowing what would be the actual or approximate useful quantity that might ultimately be recovered from the stocks entrusted to him. Because of this uncertainty, he could not enter into any express or specific contract with the Government for the job of cleansing rice stocks given to him. The authorities however made him understood that he would be paid the market rate of four annas to eight annas per Bengal maund. The petitioner did not enter into any specific agreement as that would require his having to make a security deposit of Rs 500 and then sign an agreement and without such an agreement, there could be no express agreement under the rules The whole deal was an oral one based on a mutual understanding and "the Government did not fix any percentage or proportion of dust or refuse in the stuff supplied in order to enable him to re-deliver the cleansed goods". The actual understanding between the Government and the petitioner was therefore vaeue and incapable of estimation. The Government in 1955 stated that it supplied to the petitioner approximated --8600 pallas of mota stuff, 3561 pallas of barik stuff. 1044 pallas of lobia stuff and 1110 pallas of H.R. 19 stuff. On 29-9-55, the Director of Civil Supplies made a verification of the entire stocks and after actual weighment stated the stocks to be -- PallaS 8324. 65 seers mota stuff, pallas 3465. 9l| seers of barik stuff, pallas 1044 and 86 seers of lobia stuff and pallas 1110, seers 10 of H.R. 19 stuff There was a huge difference between the figures given by the Government and the figures given after actual weighment of stocks. The Director also verified the earlier stocks delivered prior to September 1954 and lying in his mill and noted mota stuff as 88521 and barik stuff as 239.111 Pallas. The petitioner had cleansed the stocks entrusted to him and thereafter the Government wanted him to store the cleansed stocks in his eight godowns The Government agreed to pay orally Rs. 2 per 100 bags per month in October. 1955, the Government made some sample winnowing and wanted to have a crude estimate of possible shortages which they unilaterally held at 12 per cent to 17 per cent.. This type of sample test cannot be accurate because the stuff varied from bag to bag and the percentage of rubbish was more than 40 per cent in a major quantity of bags. In February, 1956, the petitioner delivered 1769-20 pallas of mota cleansed rice to the Central Storage Department and on 23-1-56 the Government verified the cleansed stocks in all the godowns and put their seals on the hags. The Govt. then decided to sell the cleansed stocks by public auction and sold to one Ram Narayan who was the highest bidder on 7-4-56, Ram Naravan entered into a written contract and deposited huge amounts towards the said purchase contract. The Government by 23-2-56 had put its seals to all the godowns and the petitioners cleansing and stocking duty ended and no further responsibility was attached to him for the stocks sealed in godowns. The auction purchaser got the godowns opened in May. 1956 and removed all the best and consumable stuff and then wanted to avoid the further contract. He therefore reported against the petitioner saying that the seal of godown No. 8 was tampered but the Director, Civil Supplies who inspected was satisfied that the seals were not intact due to natural causes of weather, and dampness. The Government then persuaded the petitioner to take up the stock left over and he entered into a simple purchase agreement. On 8-1-57 where under a flat rate of Rs. 12-14-0 per maund for the useful stuff of mota rice was fixed. An arbitration clause was incorporated whereby the Secretary to the Department of Agriculture was made the sole arbitrator in case of dispute between the petitioner and the Government As per the terms of the agreement, he deposited Rs. 23,160 and the Tahsildar opened the seals of godowns 4. 5 and 8 on 10-1-57 and 11-1-57 examined the stocks and recorded panchanamas After removing the useless stuff, the authorities delivered to the petitioner pallas 2146-116 of mota rice and he paid Rs. 83,687-8-0 to the Department as per the agreement, in addition to the original deposit of Rs. 23,160 Out of the three godowns 4, 5 and 8 only 2146-116 (Pallas) were actually realised by the petitioner and he paid the amount due under the contract fully for the quantity he actually realised from the godowns Some small stock of 72 pallas was left over in the other godowns and it was put to auction. The petitioner was demanding from the Government to pay his bills after deducting some part-payments made earlier to him. The Civil Supplies Department then began to find out some ways and means to avoid payment of his dues and deny the amounts due to him. Then the third respondent, the Director. Civil Supplies started proceedings and issued a notice demanding a sum of Rs. 5.21.441 from the petitioner. He preferred an appeal and the Committee of Officers who heard the appeal Reiving on the contract dated 8-1-57 gave some findings. He then preferred an appeal to the Commissioner, Civil Supplies who was pleased to hold that his deposit of Rs. 23,160 should not be forfeited and a very slight shortage in stocks be granted. Pursuant to the order of the Commissioner, the Director of Civil Supplies asked the petitioner to pay Rs. 3,49,347,37. A revision was filed against that order and the Commissioner of Civil Supplies ordered that he should pay Rs. 1,09,602.29 np. by the order dated 6-8-62. Pursuant to the said order, the Director of Civil Supplies passed an order dated 6-9-62 holding that a sum of Rs 1,26,974.95 np. is due from the petitioner. It is against this liability that this Writ Petition is filed.

(3.) A counter was filed on behalf of the respondents by the Assistant Secretary to the Government in Food and Agriculture Department. It is averred by the respondents that the orders of the Commissioner or the Director of Civil Supplies are not vitiated by errors of law apparent on the face of the record which would justify an issue of a Writ of Certiorari. The amount demanded from the petitioner arose out of contractual obligations and contractual obligations cannot be questioned under Article 226 of the Constitution. The petitioner was a milling contractor of the H.C.C.C. from 1945 to the end of February, 1952 for the H.C.C.C. and from March, 1952 to 1954 for the Government and the functions of the H.C.C.C. were taken over by the Government. The petitioner had entered into an agreement with the H.C.C.C. and the Government from time to time. Milling was not undertaken at the prevailing market rates but at the rates fixed by the H.C.C.C. and the Government from time to time. There were specific contracts between the petitioner and the Government and they were executed for 1951-52 on 1-1-52 and for 1953-54 on 20-11-53. The petitioner did not correctly re-deliver every year the rice after milling and there was shortage every year.