GIMPEX LIMITED Vs. INDIAN BARYTES AND CHEMICALS LTD

JUDGEMENT

(1.) Both the appeals preferred by the same appellant arise out of the same facts and hence are disposed of by this common judgment

(2.) In both the appeals, preferred with the leave of the Court as it was not party to the Writ Petitions, the appellant assails the order of 22-3-1996 of the learned single Judge disposing of the Writ Petitions directing the respondent, No, 2 to consider the representations of respondents No. 1 and 3. Though the petition for leave to appeal also raised grounds as a public interest litigation, yet during hearing of the case we have not been addressed as dealing with public interest petition and instead the learned counsel for the appellant has confined her submissions to the appellants individual cause of action. In substance, the challenge is to the order passed by respondent No. 2 in favour of respondent No. 1 in W.A.No. 576 of 1996, stated to be in pursuance of the direction of the learned single Judge on 22-3-1996, agreeing to supply to it 88, 889 M.Ts of Barytes within a period of 31/2 months, without allowing others including the appellant to compete for the same. Of the two writ petitions, the main order has been passed in W.P.No. 5704 of 1996 and W.P.No. 5763 of 1996 has been disposed of in the terms of the order in W.P.No. 5704 of 1996 directing that the petitioner there in viz.,Trimex Industries Ltd. may join M/s. Indian Barytes and Chemicals Ltd., in filing the representation before the Andhra Pradesh Mineral Development Corporation. For the purpose of reference in this judgr lent, the parties are referred to as they are added in Writ Appeal No. 576 of 1996.

(3.) The facts disclosed by the appellant are of its being in business for the past 20 years in mining, mineral processing and export of minerals including Barytes and its operations being located in Andhra Pradesh, Tamil Nadu, Maharashtra and Gujarat. The State Government has reserved the exploitation of Barytes only by the respondent No. 2 a fully State-owned Undertaking, and cancelled on 1-12-1993 all private sub-leases leaving the respondent No. 2 as the sole producer of Barytes. A tender was flown on 8-9-1993 by respondent No. 2 for sale of Barytes intended for export for two years at the rate of 3 lakh tonnes per year. The respondent No. 1 being the successful bidder, contract was signed with the respondent No. 1 on 17-1-1994 for supply of 3 lakh tonnes of Barytes per year for two years. The appellant has been successively soliciting the respondent No. 2 for purchase of Barytes to meet its domestic as well as outside commitments but unsuccessfully, though it had in its letter of 26-4-1994 offered a higher price of Rs. 496/- per M.T. while the prevailing market rate was only Rs. 421.30p. In the meantime, the respondent No. 3 filed a writ petition challenging the decision to award the contract in favour of the first respondent, but the matter was settled out of Court between the first arid the third respondents in which the first respondent agreed to assign a quantity of 1 lakh tonnes to the third respondent which agreement was signed on 27-1-1995. On 21-4-1995, the second respondent sold 1 lakh tonnes to the third respondent without inviting tenders. That was in addition to the supply of 1 lakh tonnes under the assignment agreement of 27-1-1995. The appellant again in its letter of23-3-1995 requested the second respondent to release 1 lakh tonnes of Agrade Barytes at its own price and terms and conditions in order to enable it to meet its export commitment Therequest was reiterated on 30-6-1995, but the second respondent pleaded its inability on 14-7-1995 in view of commitments on hand and that too inspite of the offer to purchase at Rs. 496/- per M.T., bu t the second respondenthad chosen to sell 1 lakh tonnes to the third respondent on21-4-1995 at a concessional price of Rs. 468/- per M.T. While the appellant was approaching the second respondent to release Barytes in its favour, the first respondent moved the second respondent for extension of the contract as due to litigations challenging the assignment of contract to it, it lost about 36 days in operation there beingno (sic. an) interim order granted during the pendency of the Writ Appeal filed by one Ashapura Minchem Ltd. Besides, the mines were inundated with heavy rainfall for a period of 126 days during the period of November, 1994 to December, 1994 and May, 1995 and 54 days were also lost in two spells because of strike of the employees of the Mining Corporation for which there was no excavation of Barytes. Thus, in all there was about 216 days of loss in working for which there was no supply of Barytes to the first respondent. The first (sic. second) respondent considering the facts, extended the contract from 17-1-1996 on which date the two years period expired, upto 29-2-1996. Excavation/mining contract was also extended from 26-10-1995 to 29-2-1996 in order to enable him to produce maximum quantities. During such extended period, 35,000 M.Ts were supplied to the respondent No. 1. One day before the expiry of the extended period, W.P.No- 4006 of 1996 was filed by the respondent No. 1 seeking mandamus to the respondent No. 2 to consider further extension of contract upto 31-5-1996. That petition was disposed of on 28-2-1996 itself directing the respondent No. 2 to consider the request made on 20-2-1996 for further extension in view of the difficulties faced by the respondent No. 1. The respondent No. 2 considered the matter and passed orders on 12-3-1996 refusing to extend further time saying that even in the absence of specific provision in the contract for extension, yet extension had been granted upto 29-2-1996 so as to enable the respondent No. 1 to release the maximum quantities under the contract and for the purpose the excavation/ mining contract had also been extended. Clauses 14 and 4 of the contract, saying that in the event the Corporation fails to supply, the backlog will be carried forward in succeeding month/succeeding months within the contract period only, were referred as the reasons for which the respondent No. 2 was unable to extend the contracts of 17-1-1994 and 27-1-1995. Any amount lying to the credit of respondents was offered to be refunded. Respondents No. 1 and 3 thereafter filed W.P. Nos. 5704 and 5763 of 1996 on the very same grounds on which W.P.No. 4006 of 1996 had been filed. Order was passed in W.P.No. 5704 of 1996 by a learned Single Judge on22-3-1996 that the ground urged before him was non-consideration by the respondent No. 2 of the question of extension in the background of Clause 18 of the contract which was a 'force majeure' clause, but that the representation made to the respondent No. 2 by respondent No. 1 had not been made on such ground, the respondent No. 1 was directed to make a detailed representation on or before 26-3-1996 referring to Clause 18 of the contract and also giving reasons as to why the contract has to be extended, and that if such application is made, the respondent No. 2 is to consider the same and pass reasoned orders before 8-4-1996 keeping in view Clause 18 of the contract. He further directed that til! such time the matter is considered and decided, the respondent No. 2 shall not enter into contract with third parties for the subject matter covered by the writPetition, for the sale of Barytes. Order was passed on the same day on the other writ petition that the petitioner therein, respondent No. 3, may join the respondent No. 1 in making the representation. The representation was made on 26-3-1996, in consideration of which respondent No. 2 passed the impugned order on 15-4-1996 extending the contract for a period of 31/2 months to supply 88,889 M.Ts of Barytes which the resp ondent No. 1 shall produce, purchase and transport. A new price, Rs. 550/- per M.T. was fixed for supply but the rates of payment for removal of over burden and production of ROM was confined to the rates of the original excavation contract of 15-12-1993 at the rate of Rs. 19.48 and Rs. 23.98 per M.T. respectively. While the respondent No. 2 was so proceed ing with the respondent Nos. 1 ar d 3, the appellant was persisting in its request for supply of Barytes. In its letter dt. 30-3-1996, it urged that all prior commitments to respondent No.1 erded on 17-1-1996 and that even the extension granted to respondent Nos. 1 and 3 had expired on 29-2-1996. It requested, elaborating the difficulties faced by it, for immediate supply of 35,000 M.Ts of A grade Barytes, and also pointed out that it had been compelled earlier to divert its order for 30,000 M.Ts to China for which mere was loss of foreign exchange earnings to India to the extent of Rs. 6.61 crores. Since in these circumstances the extension was granted to the respondent Nos.1 and 3 for 31 /2 months and it was in pursuance of the direction in W.P. No. 5704 of 1996, the appeals were filed with the permission of the Court. It is also the case of the appellant that in its application for leave to appeal filed on 5-4-1996 it stated the prevailing market rate of Barytes to be about Rs.550/- per M.T. and it being prepared to purchase Barytes at that price for which reason the sale price was fixed for the responden t Nos. 1 and 3 at the rate of Rs. 550/- per M.T. in the order of 15-1-1996.