M/S Real Security Services I Private Limited Thorugh Managing Director vs. Maharashtra State Electricity Transmission Company Limited And Others

Held

The Court held that the matter was primarily contractual and that it would be slow to exercise its writ jurisdiction under Article 226 of the Constitution in such cases, intervening only if the State's instrumentalities acted arbitrarily or unreasonably. The Court noted that the work order had not been cancelled, nor had the agreement been terminated or revoked. The impugned communication, directing the petitioner not to place its security guards at one division, did not amount to a cancellation of the agreement. Considering Clause 13 and Schedule A of the work order, which explicitly stated that MSETCL reserved the right to curtail the number of security guards and supervisors at any time, the Court found that this action was within MSETCL's rights. The Court also stated that it was for MSETCL to consider the eligibility of the security guards. Therefore, the Court disposed of the writ petition, making it clear that if MSETCL took further steps regarding the work order/agreement, parties could take appropriate steps, and all contentions were kept open.

Facts

The petitioner, M/s Real Security Services I Private Limited, was awarded a work order by Maharashtra State Electricity Transmission Company Limited (MSETCL) for providing security guards and supervisors, valued at Rs. 2,48,18,803/-. The work order was valid for one year or until the amount was exhausted. The petitioner had deployed 131 security guards. Subsequently, MSETCL issued an impugned communication directing the removal of some security guards at one division while continuing services at others. The petitioner contended this action was arbitrary and against the terms of the agreement, particularly Clause 4, and that the replacements proposed by MSETCL were ineligible. MSETCL argued the matter was contractual, and the petitioner's remedy lay in claiming damages, not a writ petition. They relied on Clause 13 of the work order, which allowed MSETCL to change the number of security guards and supervisors as per availability and reserve the right to curtail their numbers.

Key Issues

1. Whether the impugned communication directing the removal of some security guards, despite the subsistence of a work order for a specified period and value, constitutes an arbitrary and unreasonable action by an instrumentality of the State, warranting interference under Article 226 of the Constitution? Petitioner's arguments: The petitioner argued that the impugned communication violated the letter and spirit of the agreement and the terms of the work order, specifically Clause 4, which stipulated a one-year validity or exhaustion of the order amount. They contended the action was arbitrary and that the proposed replacements were ineligible due to age, qualification, or physical unfitness. Respondent's arguments: The respondent (MSETCL) argued that the matter was purely contractual and that the petitioner had no vested right to dictate the appointment of security guards. They asserted that the petitioner's remedy was to claim damages. MSETCL relied on Clause 13 of the work order, which permitted them to change the number of security guards and supervisors and to curtail their numbers at any time.