M/S. Ssr Engineers And Contractors vs. The Union Of INDIA

Held

The Court held that the writ petition is not maintainable under Article 226 of the Constitution due to the presence of serious and complex disputed questions of fact. The Petitioner asserted supply up to Invoice No. 131, while Respondent 6 denied supply beyond Invoice No. 127 and alleged fabrication of subsequent invoices. There were also disputes regarding a settlement agreement, the nature of the contractual relationship (sub-contractor vs. supplier), and the Petitioner's performance of obligations. The Court reasoned that these factual disputes require detailed examination of evidence, including oral and documentary evidence, which is beyond the scope of summary writ proceedings. The Court found that the relief sought was essentially for recovery of money arising from contractual obligations, and in the absence of admitted liability and in the face of serious disputes, such a direction against government authorities could not be issued in writ jurisdiction. The Court distinguished the Petitioner's reliance on the Calcutta High Court judgment, noting that it was based on undisputed liability, unlike the present case. Therefore, the Court concluded that the Petitioner has an efficacious remedy in civil law for resolution of the contractual disputes.

Facts

M/s SSR Engineers and Contractors (Petitioner) filed a writ petition against the Union of India and various South Central Railways officials (Respondents 1-5) and M/s SRICO Projects Pvt Ltd (Respondent 6). The Petitioner, a GST-registered entity, was engaged by Respondent 6 as a sub-contractor for PEB materials supply and erection for railway station sheds. The Petitioner claims to have supplied materials from December 2023 to October 2024, raising invoices, and paid GST. However, Respondent 6 allegedly made delayed and insufficient payments, leaving an outstanding amount of Rs. 79,15,179/- as of October 15, 2024. The Petitioner issued a legal notice on January 24, 2025, and later a representation on January 31, 2026, requesting the Respondents not to disburse retention amounts to Respondent 6 and instead pay the Petitioner directly. The Petitioner argued that the Respondents are beneficiaries of the work and have an obligation to ensure payment.

Key Issues

1. Whether the Petitioner, as a sub-contractor, has sufficient locus standi to maintain a writ petition for recovery of dues against government authorities when there are disputed questions of fact regarding the contractual relationship and the amount owed. 2. Whether the High Court, in its writ jurisdiction under Article 226 of the Constitution, can direct government authorities to withhold and divert payments to a contractor in the presence of serious disputes concerning the supply of materials, genuineness of invoices, existence and effect of settlements, and the nature of the contractual relationship. Petitioner's Arguments: The Petitioner contended that they have sufficient interest and locus standi, citing the Calcutta High Court's decision in APO No. 79 of 2014. They argued that in cases of hardship and non-payment, the High Court can direct government authorities to release dues to mitigate hardship and prevent multiplicity of litigation, rather than relegating parties to a civil court. They also asserted that the official Respondents, being beneficiaries of the work, have an obligation to ensure payment. Revenue/State's Arguments: The judgment does not explicitly record arguments from Respondents 1-5. Respondent 6 argued that the writ petition involves serious and complex disputed questions of fact, including the denial of supply beyond a certain invoice, allegations of fabricated invoices, disputes over a settlement agreement, the nature of the relationship (supplier vs. sub-contractor), and the Petitioner's alleged non-performance of certain obligations. Respondent 6 also questioned the Petitioner's conduct in filing the writ petition.