Sree Andal and Co. Vs. the Chairman and Managing Director, Tamil Nadu Textile Corporation Limited and anr. - Court Judgment

Excerpt:
- orders.m. ali mohamed, j.1. the petitioner herein sree andal and company is a partnership firm. the managing partner in the affidavit filed in support of his petition has averred that he is the managing partner of sree andal and company, komarapalayam, manufacturer of superior quality powerlooms, spindle tapelooms, dropbox looms, nepal pedal looms, blowroom scutcher, hopper feeder, hopper bale breaker, mono-cylinder, step cleaner etc., and it is a ssi unit and as such participated in the tender called for by the chairmanand managing director of tamil nadu textile corporation on 13.7.1992 for the purchase of 56' reed space drop box powerlooms 100 nos. 72' r.s. plain powerlooms-50 nos. and 72' r.s. powerloom with drill motion attachment 58 nos.2. the respondent's lender was accepted with regard to 43 looms out of which 4 looms were supplied by the petitioner. subsequently, the balance was cancelled by g.o.ms. no. 43, adi dravidar and tribal welfare department, on the recommendation of the director of handlooms and textiles to reduce the number of looms to be installed to the extent necessary in the aforesaid societies in view of the escalation of the of the project cost in order to enable the scheme to be implemented within the original estimated cost. the respondent returned the bank guarantee for rs. 2,23,600 to the petitioner. subsequently, by g.o.ms. no. 89, handlooms, handicrafts, textiles and khadi (d2) department (hht & k), dated 20.3.1992, under a separate scheme, supply of 1,000 numbers of looms to be given to handloom weavers, was placed with sunrise industrials, karnataka. aggrieved by the said order of cancellation of the original looms supplied by the petitioner, he has filed this writ petition for issue of a writ of certiorarified mandamus.3. a counter-affidavit has been filed on behalf of the respondent wherein the respondent has taken the stand that the supply of 1,000 looms allotted to sunrise industrials, karnataka relates to a separate scheme sanctioned by the government under g.o.ms. no. 89, dated 20.3.1992 and it is not connected with the earlier scheme and the petitioner has no right to insist that he should be considered under the fresh scheme.4. mr. p.h. pandian, learned counsel for the petitioner vehemently contended that the petitioner has invested huge sums of money borrowed from third parties and the cancellation of the tender after supply of 4 looms is against the guarantee given in article 19(1)(g) of the constitution of india. he further submit that having once accepted the tender, the petitioner has no right to cancel the same before the entire quantity was supplied and the action of the petitioner was arbitrary.5. on the other hand, learned counsel for the respondent submitted that tamil nadu textiles corporation, an instrumentality of the state government with regard to the contract is in the same position as an individual and there is no question of invoking article 19(1)(g) and article l4with regard to such transactions. in support of the said contention, learned counsel for petitioner cited the ruling of the supreme court in c.k. achuthan v. the state of kerala and ors. : air1959sc490 , wherein the supreme court has observed as follows:the gist of the present matter is the breach, if any of the contract said to have been given to the petitioner which has been cancelled either for good or bad reasons. there is no discrimination, because it is perfectly open to the government, even as it is to a private party, to choose a person to their liking, to fulfil contracts which they wish to be performed. when one person is chosen rather than another, the aggrieved party cannot claim the protection of article 14, because the choice of the person to fulfil a particular contract must be left to the government. similarly, a contract which is held from government stands on no different footing from a contract held from a private party. the breach of the contract, if any, may entitle the person aggrieved to sue for damages or in appropriate cases, even specific performance, but he cannot complain that there has been a deprivation of the right to practise any profession or to carry on any occupation, trade or business, such as is contemplated by article 19(1)(g). nor has it been shown how article 31 of the constitution may be invoked to prevent cancellation of a contract in exercise of powers conferred by one of the terms of the contract itself.6. there is force in the contention of the learned counsel for the respondent that as far as the commercial contracts are concerned, the instrumentality of the state such as tamil nadu textile corporation is in the same position as a private individual and has the right to conduct its business, and if there is breach of contract, the remedies are open to the petitioner for damages and it is not open to the petitioner to contend that it has violated its right to carry on business under article 19(1)(g) of the constitution. mr. p.h. pandian, learned counsel for the petitioner vehemently contended that the respondent ought to have chosen the petitioner, a small scale organiser functioning in tamil nadu instead of choosing sunrise industrials which is functioning at karnataka state and the norms with regard to giving preference to small scale industries have been violated by the respondent. there is force in the contention of mr. p.h. pandian as far as the above contention is concerned. however, as the dispute relates to one of contract and the alleged breach of the same, it is open to the petitioner to take appropriate legal proceedings in the matter. in view of the above, there are no merits in the writ petition. accordingly, the writ petition is dismissed. upon the facts and circumstances, there shall be no order as to costs.

Judgment:
ORDER

S.M. Ali Mohamed, J.

1. The petitioner herein Sree Andal and Company is a partnership firm. The Managing Partner in the affidavit filed in support of his petition has averred that he is the Managing Partner of Sree Andal and Company, Komarapalayam, manufacturer of superior quality powerlooms, spindle tapelooms, Dropbox Looms, Nepal Pedal Looms, Blowroom scutcher, Hopper Feeder, Hopper Bale Breaker, Mono-cylinder, Step Cleaner etc., and it is a SSI Unit and as such participated in the tender called for by the Chairmanand Managing Director of Tamil Nadu Textile Corporation on 13.7.1992 for the purchase of 56' Reed space Drop Box Powerlooms 100 Nos. 72' R.S. plain Powerlooms-50 Nos. and 72' R.S. Powerloom with Drill Motion attachment 58 nos.

2. The respondent's lender was accepted with regard to 43 looms out of which 4 looms were supplied by the petitioner. Subsequently, the balance was cancelled by G.O.Ms. No. 43, Adi Dravidar and Tribal Welfare Department, on the recommendation of the Director of Handlooms and Textiles to reduce the number of looms to be installed to the extent necessary in the aforesaid societies in view of the escalation of the of the project cost in order to enable the scheme to be implemented within the original estimated cost. The respondent returned the bank guarantee for Rs. 2,23,600 to the petitioner. Subsequently, by G.O.Ms. No. 89, Handlooms, Handicrafts, Textiles and Khadi (D2) Department (HHT & K), dated 20.3.1992, under a separate scheme, supply of 1,000 numbers of looms to be given to handloom weavers, was placed with Sunrise Industrials, Karnataka. Aggrieved by the said order of cancellation of the original looms supplied by the petitioner, he has filed this writ petition for issue of a writ of certiorarified mandamus.

3. A counter-affidavit has been filed on behalf of the respondent wherein the respondent has taken the stand that the supply of 1,000 looms allotted to Sunrise Industrials, Karnataka relates to a separate scheme sanctioned by the Government under G.O.Ms. No. 89, dated 20.3.1992 and it is not connected with the earlier scheme and the petitioner has no right to insist that he should be considered under the fresh scheme.

4. Mr. P.H. Pandian, learned Counsel for the petitioner vehemently contended that the petitioner has invested huge sums of money borrowed from third parties and the cancellation of the tender after supply of 4 looms is against the guarantee given in Article 19(1)(g) of the Constitution of India. He further submit that having once accepted the tender, the petitioner has no right to cancel the same before the entire quantity was supplied and the action of the petitioner was arbitrary.

5. On the other hand, learned Counsel for the respondent submitted that Tamil Nadu Textiles Corporation, an instrumentality of the State Government with regard to the contract is in the same position as an individual and there is no question of invoking Article 19(1)(g) and Article l4with regard to such transactions. In support of the said contention, learned Counsel for petitioner cited the ruling of the Supreme Court in C.K. Achuthan v. The State of Kerala and Ors. : AIR1959SC490 , wherein the Supreme Court has observed as follows:

The gist of the present matter is the breach, if any of the contract said to have been given to the petitioner which has been cancelled either for good or bad reasons. There is no discrimination, because it is perfectly open to the Government, even as it is to a private party, to choose a person to their liking, to fulfil contracts which they wish to be performed. When one person is chosen rather than another, the aggrieved party cannot claim the protection of Article 14, because the choice of the person to fulfil a particular contract must be left to the Government. Similarly, a contract which is held from Government stands on no different footing from a contract held from a private party. The breach of the contract, if any, may entitle the person aggrieved to sue for damages or in appropriate cases, even specific performance, but he cannot complain that there has been a deprivation of the right to practise any profession or to carry on any occupation, trade or business, such as is contemplated by Article 19(1)(g). Nor has it been shown how Article 31 of the Constitution may be invoked to prevent cancellation of a contract in exercise of powers conferred by one of the terms of the contract itself.

6. There is force in the contention of the learned Counsel for the respondent that as far as the commercial contracts are concerned, the instrumentality of the State such as Tamil Nadu Textile Corporation is in the same position as a private individual and has the right to conduct its business, and if there is breach of contract, the remedies are open to the petitioner for damages and it is not open to the petitioner to contend that it has violated its right to carry on business under Article 19(1)(g) of the Constitution. Mr. P.H. Pandian, learned Counsel for the petitioner vehemently contended that the respondent ought to have chosen the petitioner, a small scale organiser functioning in Tamil Nadu instead of choosing Sunrise Industrials which is functioning at Karnataka State and the norms with regard to giving preference to small scale industries have been violated by the respondent. There is force in the contention of Mr. P.H. Pandian as far as the above contention is concerned. However, as the dispute relates to one of contract and the alleged breach of the same, it is open to the petitioner to take appropriate legal proceedings in the matter. In view of the above, there are no merits in the writ petition. Accordingly, the writ petition is dismissed. Upon the facts and circumstances, there shall be no order as to costs.