M/S. Awadesh Singh Gautam vs. State Of Chhattisgarh

Facts

The petitioner, M/s. Awadesh Singh Gautam, filed a writ petition seeking directions for payment of Goods and Services Tax (GST) over and above the quoted rates for a road construction work. The petitioner participated in a tender process initiated by Respondent No. 2, and its bid was accepted. The Notice Inviting Tender (NIT) contained Clause 14 stating GST would be applicable as per government directives, and Clause 41.1, which the petitioner claims implied rates were inclusive of all taxes, was later identified by the respondents as a clerical error. The petitioner argued that its bid was exclusive of GST due to Clause 14. The work is near completion. The respondents contended that Clause 41.1 was a clerical error and its correction was necessary to prevent loss to the public exchequer, and that the petition was not maintainable due to disputed questions of fact.

Held

The Court held that it is a settled proposition of law that the High Court should not exercise its jurisdiction under Article 226 of the Constitution of India when disputed questions of fact are involved. The Court referred to several Supreme Court judgments, including Chairman, Grid Corporation of Orissa Ltd. (GRIDCO) and others v. Sukamani Das (Smt.) and another, (1999) 7 SCC 298, S.P.S. Rathore v. State of Haryana and others, (2005) 10 SCC 1, Shubhas Jain v. Rajeshwari Shivam, 2021 SCC OnLine SC 562, Union of India Vs. Puna Hinda, (2021) 10 SCC 690, and M.P. Power Management Co. Ltd. v. Sky Power Southeast Solar India (P) Ltd., (2023) 2 SCC 703. The Court found that the relief sought by the petitioner was contingent upon the resolution of disputed questions of fact, particularly regarding the interpretation of the NIT clauses and the alleged clerical error. The Court noted that the reimbursement of GST would cause a huge loss to the public exchequer and that the petitioner could not take undue advantage of a clerical error. Therefore, the Court concluded that it would not be appropriate to entertain the writ petition as disputed questions of fact were involved. The petition was dismissed, with liberty reserved for the petitioner to pursue alternate remedies.

Key Issues

1. Whether the High Court should entertain a writ petition under Article 226 of the Constitution of India when the case involves disputed questions of fact, specifically concerning the interpretation of contractual clauses regarding the inclusion or exclusion of GST in the quoted bid amount? (Question of law and mixed fact and law, turning on the principles governing writ jurisdiction and contractual disputes). Petitioner's arguments: The petitioner argued that Clause 14 of the NIT indicated GST would be paid separately, making its bid exclusive of GST. It relied on the case of ABL International Ltd. And Anr. Vs. Export Credit Guarantee Corporation of India Ltd. And Ors. (2004) 3 SCC 533, Kathupalli Venkata Sowmya Vs. State of Andhra Pradesh 2022 SCC Online AP 646 and Kanika Construction Vs. State of U.zP. And Others 2022 SCC Online All 30. The petitioner also pointed to Clause 41.1 of the NIT, which was later admitted by the respondents to be a clerical error, as further support for its claim. Respondents' arguments: The State counsel argued that Clause 41.1, which deemed rates inclusive of all taxes, was a clerical error and its correction was essential to avoid a significant loss to the public exchequer. They contended that the petition was not maintainable as it involved disputed questions of fact that could not be adjudicated in a writ petition under Article 226 of the Constitution of India.