Bombay High Court
Fabtech Projets And Engineers Ltd … vs Indian Oil Corporation Ltd And Anr on 23 July, 2026
Author: Manish Pitale
Bench: Manish Pitale
CNR No : HCBM010504592024
WP16219_24.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.16219 OF 2024
Fabtech Projects & Engineers Limited ... Petitioner
Vs.
Indian Oil Corporation Limited and another ... Respondents
Mr. Mayur Khandeparkar a/w. Mr. Chaitanya Nikte, Mr. Swapnil Sangle and
Mr.Shubankar Kulkarni i/b. Esha Malik for Petitioner.
Ms. Huzan Bhumgara a/w. Mr. Amit Meharia, Ms. Tannishtha Singh,
Ms.Paramita Banerjee, Mr. Preet Dabre and Mr. Himanshu Singh i/b. Meharia &
Co. for Respondent No.1.
Mrs. Shehnaz V. Bharucha for Respondent No.2.
CORAM : MANISH PITALE &
SHREERAM V. SHIRSAT, JJ.
DATE : JULY 23, 2026
ORAL ORDER : (Per Manish Pitale, J.)
. The petitioner is a company now run by a successful resolution
applicant after Corporate Insolvency Resolution Process (CIRP) had
intervened in the light of the earlier management of the company
causing the CIRP process to be undertaken under the provisions of the
Insolvency and Bankruptcy Code, 2016 (IBC). This aspect is crucial, for
the reason that the petitioner contends that the said aspect of the matter
is a clear answer to the preliminary objection regarding maintainability
of the present writ petition raised on behalf of the respondent No.1 –
Indian Oil Corporation Limited (IOCL). The petitioner company has
filed the present writ petition for a direction to the respondents to
forthwith release a specific amount payable to it for works done against
specific purchase orders for Guwahati and Panipat Refineries of the
respondent No.1 – IOCL. The petitioner company also prays for
MINAL by
Digitally signed
MINAL
SANDIP SANDIP PARAB
Date: 2026.07.23
quashing of a communication dated 26.06.2024, whereby reliance was
PARAB 14:57:51 +0530
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placed on adjustment of payment towards Risk and Cost terms executed
with the company before it underwent CIRP.
2. In the year 2019, the respondent No.1 – IOC awarded a contract
for fabrication, erection, testing and commissioning of storage tanks at
its Solapur Depot to the petitioner company, which was under the
erstwhile management. On 24.09.2019, CIRP was commenced in respect
of the petitioner company when a petition under the provisions of the
IBC was admitted by the National Company Law Tribunal, Mumbai
(NCLT). The respondent No.1 – IOC was aware about the CIRP
concerning the petitioner company as it had submitted its claims
pertaining to its Bongaigaon Refinery with the resolution professional.
But, admittedly, respondent No.1 – IOC did not submit any claim for
Risk and Cost in respect of its claims concerning the petitioner company
in the aforesaid pending CIRP before the resolution professional.
3. On 16.11.2021, the NCLT approved the resolution plan submitted
by the new management and hence, the successful resolution applicant
as the new management took over the petitioner company. On
10.03.2022, the NCLT modified its order dated 16.11.2021 in the light of
the law laid down by the Supreme Court in its judgement in the case of
Ghanashyam Mishra and Sons Private Limited Vs. Edelweiss Asset
Reconstruction Company Limited and others, (2021) 9 SCC 657.
Accordingly, it was specifically recorded that any claim, which did not
form part of the resolution plan would stand permanently extinguished
and waived and further that, no proceedings could be initiated for such a
claim.
4. On 09.05.2023, the new management took over the petitioner
company as it was revived through CIRP and accordingly, all claims
except those provided in the resolution plan stood extinguished by
operation of law. Thereafter, respondent No.1 – IOCL awarded the two
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separate contracts to the petitioner company for its Guwahati and
Panipat Refineries. The present dispute pertains to the amounts payable
to the petitioner company in respect of the said projects. The petitioner
company followed up the matter with the respondent No.1 – IOCL by
submitting representations in June 2024. But on 26.06.2024, the
impugned e-mail was received from the respondent No.1 – IOCL stating
that there was a debit recovery of Rs.3.91 crores under the Risk and Cost
pertaining to Solapur Project of respondent No.1 – IOCL and that the
payments due for the ongoing projects at Guwahati and Panipat
Refineries would be adjusted towards the same.
5. Aggrieved by the aforesaid approach adopted by the respondent
No.1 – IOC, the petitioner company has filed the present writ petition.
6. Mr. Khandeparkar, learned counsel appearing for the petitioner
submitted that the preliminary objection with regard to maintainability
of the present writ petition raised on behalf of the respondent No.1 –
IOC, is without any substance. It was submitted that the only basis for
disputing the payments due to the petitioner company, is the claim of
respondent No.1 – IOCL that it can rely upon alleged amounts due under
the Risk and Cost executed with the petitioner company prior to CIRP
concerning the Solapur Project. It was submitted that the said basis for
disputing payments due to the petitioner company is wholly
unsustainable as it is in the teeth of Section 31 of the IBC and the law
clarified by the Supreme Court in the case of Ghanashyam Mishra and
Sons Private Limited Vs. Edelweiss Asset Reconstruction Company
Limited and others (supra). It is submitted that since the repudiation of
the claim of the petitioner company gives rise to a pure question of law,
which as per the settled position of law is answered in favour of the
petitioner company, the action of the respondent No.1 – IOCL, which is
an agency and instrumentality of the State is rendered wholly arbitrary
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and hence, the writ petition is maintainable. On the question of
maintainability of writ petition, reliance was placed on judgements of
the Supreme Court in the cases of ABL International Limited Vs. Export
Credit Guarantee Corporation of India and others, (2004) 3 SCC 553;
M/s. Surya Constructions Vs. State of Uttar Pradesh and others, 2019
SCC OnLine SC 2442; DFO South Kheri and others Vs. Ram Sanehi
Singh, (1971) 3 SCC 864; as also judgement of this Court in the case of
A2Z Infraservices Limited Vs. Union of India and others, 2018 SCC
OnLine Bom.1042.
7. It was submitted that once it is demonstrated that the writ petition
is maintainable, there is no defence available to the respondent No.1 –
IOCL, and therefore, the prayers made in the present writ petition
deserve to be granted. On the question of the petitioner having filed
applications before the NCLT, it was explained that the reliefs sought
therein pertained to the resolution plan, which was accepted, while the
relief sought in the present petition has a public law element, which the
NCLT would not be able to consider. On this basis, it was submitted that
the writ petition may be allowed.
8. On the other hand, Ms. Bhumgara, learned counsel appearing for
respondent No.1 – IOCL submitted that the only contention being raised
on behalf of the said respondent pertained to the very maintainability of
the present writ petition. It was submitted that a perusal of the prayer
clauses would show that it is nothing but an action for recovery of
alleged dues to the petitioner company. Since the respondent No.1 –
IOCL is disputing the liability to pay the said amount, such a
controversy ought to be agitated before the competent civil court and not
before this Court exercising writ jurisdiction. It was submitted that in the
facts and circumstances of the present case, a writ of mandamus can
certainly not be issued. Reliance was placed on judgement of the
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Supreme Court in the case of State of UP Vs. Bridge & Roof Company
(India) Limited, (1996) 6 SCC 22.
9. On this basis, it was submitted that the writ petition deserved to
be dismissed and the petitioner company ought to be relegated to the
alternative remedy of approaching the competent civil court.
10. Having considered the rival submissions, we find that the
controversy in the present petition is in a very narrow conspectus. There
is no dispute about the fact that the petitioner company underwent CIRP
and that today, it is being run by the successful resolution applicant. The
amounts claimed by the respondent No.1 – IOCL under Risk and Cost
terms admittedly pertain to the amounts claimed by the respondent No.1
– IOCL from the petitioner company in its earlier avatar, prior to
undergoing CIRP. It is also an admitted position that in respect of the
said dues, the respondent No.1 – IOCL did not raise any claim during the
CIRP before the resolution professional. As a consequence, the said dues
were not part of the resolution plan as approved by the NCLT.
11. It is also an admitted position that the respondent No.1 – IOCL
was aware about the fact that the petitioner company was undergoing
CIRP, as it had raised claim in the said process before the Resolution
Professional in respect of its other project concerning the Bongaigaon
Refinery. These admitted facts are crucial for considering the question as
to whether the only basis for the respondent No.1 – IOCL to dispute the
amount now due and payable to the petitioner company can be
sustained.
12. This also has a direct bearing on the preliminary objection
regarding maintainability raised on behalf of the respondent No.1 –
IOCL. We are of the opinion that the only basis on which the respondent
No.1 – IOCL is disputing payment of dues to the petitioner company
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being run by the successful resolution applicant, gives rise to a question
of law concerning provisions of the IBC and the interpretation of the
same rendered by the Supreme Court. In such a situation where no other
dispute is raised, including on the quantum of the dues claimed by the
petitioner company for its works in Guwahati and Panipat Refineries of
respondent No.1 – IOCL, there is no disputed question of fact at all,
necessitating leading of evidence in any manner. If the question that
arises for consideration, in the light of the only ground raised by the
respondent No.1 – IOCL for disputing the amounts due and payable to
the petitioner company, is answered against the respondent No.1 – IOCL,
its action can be demonstrated to be arbitrary, justifying filing of the
present writ petition by the petitioner company.
13. In this context, the position of law clarified by the Supreme Court
in the case of Ghanashyam Mishra and Sons Private Limited Vs.
Edelweiss Asset Reconstruction Company Limited and others
(supra) assumes significance. After referring to the provisions of the
IBC in great detail, the Supreme Court in the said judgement observed as
follows:-
“66. Vide Section 7 of Act 26 of 2019 [vide S.O. 2953(E),
dated 16-8-2019 with effect from 16-8-2019], the following
words have been inserted in Section 31 of the I&B Code:
‘including the Central Government, any State
Government or any local authority to whom a
debt in respect of the payment of dues arising
under any law for the time being in force, such as
authorities to whom statutory dues are owed.’
67. As such, with respect to the proceedings, which arise
after 16-8-2019, there will be no difficulty. After the
amendment, any debt in respect of the payment of dues
arising under any law for the time being in force including the
ones owed to the Central Government, any State Government
or any local authority, which does not form a part of the
approved resolution plan, shall stand extinguished.
* * * * * *
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95. In the result, we answer the questions framed by us as
under:
(i) That once a resolution plan is duly approved by the
adjudicating authority under sub-section (1) of Section 31, the
claims as provided in the resolution plan shall stand frozen
and will be binding on the corporate debtor and its
employees, members, creditors, including the Central
Government, any State Government or any local authority,
guarantors and other stakeholders. On the date of approval of
resolution plan by the adjudicating authority, all such claims,
which are not a part of resolution plan, shall stand
extinguished and no person will be entitled to initiate or
continue any proceedings in respect to a claim, which is not
part of the resolution plan;
(ii) 2019 Amendment to Section 31 of the I&B Code is
clarificatory and declaratory in nature and therefore will be
effective from the date on which the I&B Code has come into
effect;
(iii) Consequently all the dues including the statutory dues
owed to the Central Government, any State Government or
any local authority, if not part of the resolution plan, shall
stand extinguished and no proceedings in respect of such dues
for the period prior to the date on which the adjudicating
authority grants its approval under Section 31 could be
continued.”
14. The aspect of availability of alternative remedy was also argued
before the Supreme Court in the said case and in that context, the
Supreme Court in the said judgement held as follows:-
“128. The main ground raised on behalf of the respondent is
with regard to availability of alternate remedy. The second
ground raised is, since the transfer date is prior to the 2019
Amendment to Section 31 of the I&B Code, the said
amendment would not be applicable to the debts owed to the
State Government or the Central Government.
129. As held by this Court in a catena of cases including in
Baburam Prakash Chandra Maheshwari v. Antarim Zila
Parishad, Muzaffarnagar [Baburam Prakash Chandra
Maheshwari v. Antarim Zila Parishad, Muzaffarnagar,
(1969) 1 SCR 518 : AIR 1969 SC 556], Whirlpool Corpn. v.
Registrar of Trade Marks [Whirlpool Corpn. v. Registrar of
Trade Marks, (1998) 8 SCC 1], Nivedita Sharma v. COAI
[Nivedita Sharma v. COAI, (2011) 14 SCC 337 : (2012) 4
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SCC (Civ) 947], Embassy Property Developments (P) Ltd. v.
State of Karnataka [Embassy Property Developments (P) Ltd.
v. State of Karnataka, (2020) 13 SCC 308] and recently in
Kalpraj Dharamshi [Kalpraj Dharamshi v. Kotak Investment
Advisors Ltd., (2021) 10 SCC 401 : 2021 SCC OnLine SC
204] , that non-exercise of jurisdiction under Article 226 is a
rule of self-restraint. It has been consistently held that the
alternate remedy would not operate as a bar in at least three
contingencies, namely,
(1) where the writ petition has been filed for the
enforcement of any of the fundamental rights;
(2) where there has been a violation of the principle of
natural justice; and
(3) where the order or proceedings are wholly without
jurisdiction or the vires of an Act is challenged.
130. In the foregoing paragraphs, we have held that the
2019 Amendment to Section 31 of the I&B Code is
clarificatory and declaratory in nature and therefore will have
a retrospective operation. As such, when the resolution plan is
approved by NCLT, the claims, which are not part of the
resolution plan, shall stand extinguished and the proceedings
related thereto shall stand terminated. Since the subject-matter
of the petition are the proceedings, which relate to the claims
of the respondents prior to the approval of the plan, in the
light of the view taken by us, the same cannot be continued.
Equally the claims, which are not part of the resolution plan,
shall stand extinguished.
131. In this view of the matter, we find that relegating the
appellant to the alternative remedy would serve no purpose. A
party cannot be made to run from one forum to another forum
in respect of the proceedings and the claims which are not
permissible in law.”
15. We are of the opinion that in the face of such an authoritative
pronouncement of the Supreme Court regarding the position of law, the
respondent No.1 – IOCL as an agency and instrumentality of the State
has arbitrarily refused to pay the amounts due to the petitioner company
by referring to its alleged dues under Risk and Cost terms pertaining to
the Solapur Project for which the said respondent had engaged the
petitioner company in its earlier avatar before CIRP kicked in. As noted
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hereinabove, the respondent No.1 – IOCL could have raised its claim
before the Resolution Professional in the CIRP, but it failed to do so,
despite being aware about the fact that the petitioner company was
undergoing CIRP. As a matter of fact, it raised claim before the
Resolution Professional for another project. By operation of law, the
aforementioned earlier claims upon which the respondent No.1 – IOCL
is trying to rely at this point in time, stood extinguished. This renders the
impugned action and the impugned communication dated 26.06.2024
issued by the respondent No.1 – IOCL as arbitrary and wholly
unsustainable. There is no question of the respondent No.1 – IOCL,
withholding amounts due to the petitioner company for its works
pertaining to Guwahati and Panipat Refineries.
16. We also do not find any substance in the contention raised on
behalf of the respondent No.1 – IOCL by relying upon the judgement of
the Supreme Court in the case of State of UP and others Vs. Bridge &
Roof Company (India) Limited (supra). In the said case, the
concerned company had raised a simplicitor claim of amounts due and
payable under a contract in the realm of private law. In that context, the
Supreme Court found that interpretation of terms and conditions of
contract was involved and the amount due itself was being disputed by
the State. In that context, it was held that writ petition under Article 226
of the Constitution of India was not maintainable.
17. We find that in the case of ABL International Limited and
another Vs. Export Credit Guarantee Corporation of India Limited
and others (supra), the Supreme Court discussed in detail as to in what
conditions a writ petition would be maintainable even in the context of a
contract wherein a State or an agency or an instrumentality of the State
was one of the parties. In the said judgement, the Supreme Court also
considered its earlier aforesaid judgement in the case of State of UP and
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others Vs. Bridge & Roof Company (India) Limited (supra) and yet,
held that the writ petition under Article 226 of the Constitution of India
would be maintainable. The relevant portion of the said judgement reads
as follows:-
“10. It is clear from the above observations of this Court in
the said case, though a writ was not issued on the facts of that
case, this Court has held that on a given set of facts if a State
acts in an arbitrary manner even in a matter of contract, an
aggrieved party can approach the court by way of writ under
Article 226 of the Constitution and the court depending on
facts of the said case is empowered to grant the relief. This
judgment in K.N. Guruswamy v. State of Mysore [AIR 1954
SC 592 : (1955) 1 SCR 305] was followed subsequently by
this Court in the case of D.F.O. v. Ram Sanehi Singh [(1971)
3 SCC 864] wherein this Court held: (SCC p. 865, para 4)
‘By that order he has deprived the respondent of a
valuable right. We are unable to hold that merely because
the source of the right which the respondent claims was
initially in a contract, for obtaining relief against any
arbitrary and unlawful action on the part of a public
authority he must resort to a suit and not to a petition by
way of a writ. In view of the judgment of this Court in
K.N. Guruswamy case [AIR 1954 SC 592 : (1955) 1 SCR
305] there can be no doubt that the petition was
maintainable, even if the right to relief arose out of an
alleged breach of contract, where the action challenged
was of a public authority invested with statutory power.’
(emphasis supplied)
11. In the case of Gujarat State Financial Corpn. v. Lotus
Hotels (P) Ltd. [(1983) 3 SCC 379] this Court following an
earlier judgment in Ramana Dayaram Shetty v. International
Airport Authority of India [(1979) 3 SCC 489] held: (SCC pp.
385-86, paras 9 & 11)
The instrumentality of the State which would be
‘other authority’ under Article 12 cannot commit
breach of a solemn undertaking to the prejudice of
the other party which acted on that undertaking or
promise and put itself in a disadvantageous
position. The appellant Corporation, created under
the State Financial Corporations Act, falls within
the expression of ‘other authority’ in Article 12 and
if it backs out from such a promise, it cannot be
said that the only remedy for the aggrieved party
would be suing for damages for breach and that it10/16
WP16219_24.doccould not compel the Corporation for specific
performance of the contract under Article 226.
12. The learned counsel appearing for the first respondent,
however, submitted that this Court has taken a different view
in the case of LIC of India v. Escorts Ltd. [(1986) 1 SCC 264]
wherein this Court held: (SCC p. 344, para 102)
” If the action of the State is related to
contractual obligations or obligations arising out of
the tort, the court may not ordinarily examine it
unless the action has some public law character
attached to it. Broadly speaking, the court will
examine actions of State if they pertain to the public
law domain and refrain from examining them if they
pertain to the private law field. The difficulty will lie
in demarcating the frontier between the public law
domain and the private law field. It is impossible to
draw the line with precision and we do not want to
attempt it. The question must be decided in each
case with reference to the particular action, the
activity in which the State or the instrumentality of
the State is engaged when performing the action, the
public law or private law character of the action and
a host of other relevant circumstances. When the
State or an instrumentality of the State ventures into
the corporate world and purchases the shares of a
company, it assumes to itself the ordinary role of a
shareholder, and dons the robes of a shareholder,
with all the rights available to such a shareholder.
There is no reason why the State as a shareholder
should be expected to state its reasons when it seeks
to change the management, by a resolution of the
company, like any other shareholder.”
(emphasis supplied)
13. We do not think this Court in the above case has, in
any manner, departed from the view expressed in the earlier
judgments in the case cited hereinabove. This Court in the
case of LIC of India [(1986) 1 SCC 264] proceeded on the
facts of that case and held that a relief by way of a writ
petition may not ordinarily be an appropriate remedy. This
judgment does not lay down that as a rule in matters of
contract the court’s jurisdiction under Article 226 of the
Constitution is ousted. On the contrary, the use of the words
“court may not ordinarily examine it unless the action has
some public law character attached to it” itself indicates that
in a given case, on the existence of the required factual matrix
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a remedy under Article 226 of the Constitution will be
available. The learned counsel then relied on another
judgment of this Court in the case of State of U.P. v. Bridge &
Roof Co. (India) Ltd. [(1996) 6 SCC 22] wherein this Court
held: (SCC p. 31, para 21)
Further, the contract in question contains a
clause providing inter alia for settlement of disputes
by reference to arbitration. The arbitrators can decide
both questions of fact as well as questions of law.
When the contract itself provides for a mode of
settlement of disputes arising from the contract, there
is no reason why the parties should not follow and
adopt that remedy and invoke the extraordinary
jurisdiction of the High Court under Article 226. The
existence of an effective alternative remedy — in this
case, provided in the contract itself — is a good
ground for the court to decline to exercise its
extraordinary jurisdiction under Article 226.
14. This judgment again, in our opinion, does not help the
first respondent in the argument advanced on its behalf that in
contractual matters remedy under Article 226 of the
Constitution does not lie. It is seen from the above extract that
in that case because of an arbitration clause in the contract,
the Court refused to invoke the remedy under Article 226 of
the Constitution. We have specifically inquired from the
parties to the present appeal before us and we have been told
that there is no such arbitration clause in the contract in
question. It is well known that if the parties to a dispute had
agreed to settle their dispute by arbitration and if there is an
agreement in that regard, the courts will not permit recourse
to any other remedy without invoking the remedy by way of
arbitration, unless of course both the parties to the dispute
agree on another mode of dispute resolution. Since that is not
the case in the instant appeal, the observations of this Court in
the said case of Bridge & Roof Co. [(1996) 6 SCC 22] are of
no assistance to the first respondent in its contention that in
contractual matters, writ petition is not maintainable.
15. The learned counsel then contending that this Court
will not entertain a writ petition involving disputed questions
of fact relied on a judgment of this Court in the case of State
of Bihar v. Jain Plastics and Chemicals Ltd. [(2002) 1 SCC
216] wherein this Court held: (SCC p. 218, para 7)
‘7. In our view, it is apparent that the order passed
by the High Court is, on the face of it, illegal and
erroneous. It is true that many matters could be
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decided after referring to the contentions raised in the
affidavits and counter-affidavits, but that would
hardly be a ground for exercise of extraordinary
jurisdiction under Article 226 of the Constitution in
case of alleged breach of contract. Whether the
alleged non-supply of road permits by the appellants
would justify breach of contract by the respondent
would depend upon facts and evidence and is not
required to be decided or dealt with in a writ petition.
Such seriously disputed questions or rival claims of
the parties with regard to breach of contract are to be
investigated and determined on the basis of evidence
which may be led by the parties in a properly
instituted civil suit rather than by a court exercising
prerogative of issuing writs.’
16. A perusal of this judgment though shows that a writ
petition involving serious disputed questions of facts which
requires consideration of evidence which is not on record,
will not normally be entertained by a court in the exercise of
its jurisdiction under Article 226 of the Constitution of India.
This decision again, in our opinion, does not lay down an
absolute rule that in all cases involving disputed questions of
fact the parties should be relegated to a civil suit. In this view
of ours, we are supported by a judgment of this Court in the
case of Gunwant Kaur v. Municipal Committee, Bhatinda
[(1969) 3 SCC 769] where dealing with such a situation of
disputed questions of fact in a writ petition this Court held:
(SCC p. 774, paras 14-16)
’14. The High Court observed that they will not
determine disputed question of fact in a writ
petition. But what facts were in dispute and what
were admitted could only be determined after an
affidavit-in-reply was filed by the State. The High
Court, however, proceeded to dismiss the petition in
limine. The High Court is not deprived of its
jurisdiction to entertain a petition under Article 226
merely because in considering the petitioner’s right
to relief questions of fact may fall to be determined.
In a petition under Article 226 the High Court has
jurisdiction to try issues both of fact and law.
Exercise of the jurisdiction is, it is true,
discretionary, but the discretion must be exercised
on sound judicial principles. When the petition
raises questions of fact of a complex nature, which
may for their determination require oral evidence to
be taken, and on that account the High Court is of13/16
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tried in a writ petition, the High Court may decline
to try a petition. Rejection of a petition in limine will
normally be justified, where the High Court is of the
view that the petition is frivolous or because of the
nature of the claim made dispute sought to be
agitated, or that the petition against the party against
whom relief is claimed is not maintainable or that
the dispute raised thereby is such that it would be
inappropriate to try it in the writ jurisdiction, or for
analogous reasons.
15. From the averments made in the petition filed
by the appellants it is clear that in proof of a large
number of allegations the appellants relied upon
documentary evidence and the only matter in respect
of which conflict of facts may possibly arise related
to the due publication of the notification under
Section 4 by the Collector.
16. In the present case, in our judgment, the High
Court was not justified in dismissing the petition on
the ground that it will not determine disputed
question of fact. The High Court has jurisdiction to
determine questions of fact, even if they are in
dispute and the present, in our judgment, is a case in
which in the interests of both the parties the High
Court should have entertained the petition and called
for an affidavit-in-reply from the respondents, and
should have proceeded to try the petition instead of
relegating the appellants to a separate suit.’
17. The above judgment of Gunwant Kaur [(1969) 3 SCC
769] finds support from another judgment of this Court in the
case of Century Spg. and Mfg. Co. Ltd. v. Ulhasnagar
Municipal Council [(1970) 1 SCC 582] wherein this Court
held: (SCC p. 587, para 13)
‘Merely because a question of fact is raised, the
High Court will not be justified in requiring the
party to seek relief by the somewhat lengthy,
dilatory and expensive process by a civil suit against
a public body. The questions of fact raised by the
petition in this case are elementary.’
18. This observation of the Court was made while negating
a contention advanced on behalf of the respondent
Municipality which contended that the petition filed by the
appellant Company therein apparently raised questions of fact14/16
WP16219_24.docwhich argument of the Municipality was accepted by the
High Court holding that such disputed questions of fact
cannot be tried in the exercise of the extraordinary
jurisdiction under Article 226 of the Constitution. But this
Court held otherwise.
19. Therefore, it is clear from the above enunciation of law
that merely because one of the parties to the litigation raises a
dispute in regard to the facts of the case, the court
entertaining such petition under Article 226 of the
Constitution is not always bound to relegate the parties to a
suit. In the above case of Gunwant Kaur [(1969) 3 SCC 769]
this Court even went to the extent of holding that in a writ
petition, if the facts require, even oral evidence can be taken.
This clearly shows that in an appropriate case, the writ court
has the jurisdiction to entertain a writ petition involving
disputed questions of fact and there is no absolute bar for
entertaining a writ petition even if the same arises out of a
contractual obligation and/or involves some disputed
questions of fact.”
18. Therefore, the only objection raised on behalf of the respondent
No.1 – IOCL in this petition is rejected.
19. As regards reference to certain applications filed by the petitioner
company before the NCLT, we find substance in the stand taken on
behalf of the petitioner company that the said applications have been
filed for seeking refund of certain bank guarantee and security deposit,
concerning termination of tender by the respondent No.1 on account of
CIRP and other such reliefs, which have a direct bearing on the
resolution plan approved by the NCLT. Therefore, it cannot be said that
because the petitioner company has filed the said applications before the
NCLT, the present writ petition cannot be entertained. It is also a matter
of record that the order passed by the NCLT approving the resolution
plan, was confirmed by the National Company Law Appellate Tribunal
in an appeal. Therefore, the extinguishment of the claim of the
respondent No.1 – IOCL as regards its earlier claims stood confirmed.
This further demonstrates the arbitrary nature of objections raised by the
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WP16219_24.doc
respondent No.1, despite being an agency and instrumentality of the
State.
20. In view of the above, the writ petition is allowed in terms of
prayer clauses (a) and (b), which read as follows:-
“(a) That this Hon’ble Court be pleased to examine the
contents of the present Petition and upon examining the same
be pleased to issue a writ of mandamus or any other writ
thereby directing the Respondents to forthwith release an
amount of Rs.3,88,98,537/- (Rupees Three Crores Eighty Eight
Lakhs Ninety Eight Thousand Five Hundred Thirty Seven
only) undisputedly and legally payable to the Petitioner in
respect of the works done by the Petitioner against Purchase
Order bearing No.213102-001/29356551 issued by IOCL
Guwahati Refinery and Purchase Orders bearing
No.6746/156/28462936 and B269/283/28663406 issued by
IOCL Panipat Refinery; (which is more particularly described
in Particulars of Claim annexed at Exhibit F);
(b) That this Hon’ble Court be pleased to examine the
contents of the Present Petition and after examining the same
be pleased to quash and set aside (i) the Impugned
Communication dated 26/06/2024 (annexed at Exhibit D to the
Writ Petition) by Respondent No.1 and (ii) the Impugned
Illegal action and decision of the Respondents of adjusting the
disputed alleged claim ‘Risk and Cost’ of the Respondents in
respect of Tender bearing No.WRCC/2019-20/PT/23 dated
24/04/2019 floated by IOCL Solapur against the undisputed
dues receivable by the Petitioner in respect of Purchase Order
bearing No.213102-001/29356551 issued by IOCL Guwahati
Refinery and Purchase Orders bearing No.6746/156/28462936
and B269/283/28663406 issued by IOCL Panipat Refinery
(which is more particularly described in Particulars of Claim
annexed at Exhibit E) and declare to be non-est, illegal, bad in
law and contrary to the fundamental rights guaranteed under
the Constitution of India.”
21. Consequently, the respondent No.1 – IOCL shall release the said
amount in favour of the petitioner company within a period of four
weeks from the date of this order.
(SHREERAM V. SHIRSAT, J.) (MANISH PITALE, J.)
Minal Parab 16/16
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