Calcutta High Court
Jaiswal Iron And Steel Company And Ors vs Board Of Trustees For Syama Prasad on 20 May, 2026
Author: Shampa Sarkar
Bench: Shampa Sarkar
OD-2
APOT/81/2026
IA NO: GA/1/2026
IN THE HIGH COURT AT CALCUTTA
CIVIL APPELLATE JURISDICTION
ORIGINAL SIDE
JAISWAL IRON AND STEEL COMPANY AND ORS
VS
BOARD OF TRUSTEES FOR SYAMA PRASAD
MOOKERJEE PORT OF KOLKATA AND ORS
BEFORE:
The Hon'ble JUSTICE SHAMPA SARKAR
The Hon'ble JUSTICE AJAY KUMAR GUPTA
Date: 20th May, 2026.
Appearance:
Ms. Sutapa Sanyal, Adv.
Mr. Triptimoy Talukder, Adv.
Mr. Diptomoy Talukder, Adv.
Mr. Abir Bhattacharya, Adv.
Mr. Abhiraj Tarafdar, Adv.
. . .for the appellant.
Mr. Dhiraj Trivedi, Adv.
Mr. Ashok Kr. Jena, Adv.
. . .for the respondents.
The Court: The appeal arises out of an order dated April 6, 2026, passed
by a learned Single Judge in WPO No. 1578 of 2026. An order passed by the
respondent Nos. 1 and 2 dated August 19, 2025 was challenged in the writ
petition. The authorities forfeited the entire sale value deposited by the
appellant No. 1 and the said appellant was debarred from participating in
future tender/auction for a period of two years.
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The appellant No. 1 was the successful tenderer in respect of a notice
inviting tender, floated by the Syama Prasad Mookerjee Port, Kolkata
(hereinafter referred to as the Port). The authorities of the Port had conducted
an e-auction for sale of one number of condemned Pontoon lying at Takta Ghat
and two numbers of Condemned Pontoons lying at Qutram Jetty-2 on
November 29, 2023. The appellant no.1 deposited the entire sale consideration
with applicable taxes aggregating to Rs. 51,33,001/-. Delivery Order and Block
Gate pass were issued on January 11, 2024.
It was urged before the learned single Judge by the learned advocate for
the appellant no.1 that as the daily gate pass was not issued, delay occurred.
Although, labourers were mobilized for transportation of the Pontoons, the
request of the appellant no.1 to treat the Block gate pass as the daily gate pass
was not accepted.
The authorities allegedly, allowed the appellants to proceed with the
cutting of the portions without any clearance from the Port’s Fire Services. On
February 6, 2024, the Assistant Mooring Master stopped the work without any
notice. On the same day the appellants applied for waiver of Clause -2 of the
delivery order dated January 11, 2024, but no reply was received.
Ms. Sanyal learned advocate for the appellant submits that the
appellants were not allowed to continue with the work on and from February 6,
2024 and despite several letters and reminders for waiver of the second clause
of the delivery order, the authorities remained silent. The appellants’ were
waiting for a positive action in this regard from the end of the Port authorities,
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but no communication was received. The appellants had an expectation that
the clause would be waived and they could resume the cutting work. The
appellants, therefore, could not carry on with the work. Suddenly, a show
cause notice was issued by the Port authorities on May 6, 2024, after the free
delivery period was over and five months after the date of issuance of the Block
Gate pass. According to learned Advocate, the show cause notice was belated
and did not contain proper facts. The allegations lacked foundational basis. A
reply was filed to the show cause notice, denying the allegations. Finally, a
decision to forfeit the entire sale value was taken by the authorities. The
appellant No. 1 was also blacklisted. When the Port authorities decided to go
for a re-tender, the writ petition was filed challenging the forfeiture of the entire
sale value and the order of blacklisting. The learned Judge came to a finding
that the decision to black list the appellant No. 1 was contrary to law, as a
proper notice proposing such blacklisting had not been issued. This action
was violative of the principle of natural justice. With regard to the allegation of
wrongful forfeiture of the sale value, His Lordship assessed the factual aspects
and decided that the forfeiture of the sale value should not be interfered with.
Ms. Sanyal submits that the decision to forfeit the sale value was not in
accordance with the terms and conditions of the tender document and the
delivery order. The forfeiture was nothing, but unjust enrichment, on the part
of the public authority. The laches and negligence on the part of the Port
authorities resulted in non-performance of the work. Reliance has been placed
on the decision of Subhash Aggarwal Vs. Mahender Pal Chhabra and Anr.
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reported in 2026 SCC Online SC 1. It was submitted that the decision suffered
from unreasonableness.
Mr. Trivedi, learned DSGI submits that the Port authorities could never
allow waiver of the obligation to obtain a fire licence. No part of the notice
inviting tender could be altered by the authorities. Thus, the first contention of
Ms. Sanyal that the appellants are waiting for a positive step from the Port
authorities to waive Clause 2 of the delivery order, is unsustainable. The show
cause notice was issued on May 6, 2024. The answer to the same was issued
by the appellant. The decision of forfeiture was issued on August, 2025, but
the same was not challenged by the appellant for a considerable time. When
the e-tender was sought to be floated sometime in April 2026, the writ petition
was filed only to stall the process.
We have heard the learned advocates for the respective parties. His
Lordship dealt with the facts in detail. Admittedly, the appellants had not
removed the materials within the delivery period. The ground taken by the
appellants for not taking out the materials within the delivery period was that,
the daily gate pass was not provided. This was not accepted by His Lordship.
The fact remains that the clearance from the Fire-services had not been
obtained. A show cause notice was issued on May 6, 2024, wherein non-
compliances by the appellants were indicated. There were also allegations that
the appellants had started to take away the materials without a daily gate pass.
Further, according to the authorities, the applicant had unauthorizedly
resorted to stacking gas cylinders, after trespassing into the Port’s premises,
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for cutting the Pontoons at Outram Jetty II, without permission from the Port
authorities.
Although Ms. Sanyal submits that the forfeiture clause could be
imported by the authorities under very exceptional circumstances, His
Lordship found that there was nothing on record which would indicate that the
Port authorities had actually violated the terms and conditions of the contract.
There is also no clause in the tender document, permitting refund of the
proportionate sale value of unremoved lot. Thus, the issue of unjust
enrichment cannot be decided in this proceeding. According to His Lordship,
the only reason for filing the writ petition was to stall the second e-tender
process.
A show cause notice was issued before the decision to forfeit the sale
value had been taken. The appellants filed their reply. The allegations were in
the nature of breaches committed by the appellants. Those were controverted
by the appellants by filing a reply. We find from the nature of allegations and
the answers given thereto, that factual disputes emerge, which cannot be
decided either by the Writ Court or by us in an intra court appeal. The
relationship between the parties are contractual in nature. The disputes arose
out of a commercial transaction. Such disputed questions have to be decided
on evidence, which is beyond the purview of the writ court. The contract
provides for adjudication of the dispute by arbitration. Thus, the appellants
are at liberty to invoke arbitration in accordance with law.
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Interpretation of the clauses in the contract are within the domain of an
arbitrator.
The appellants will be at liberty to seek interim protection before the
learned Arbitrator or before the appropriate forum. The appeal and
application are disposed of without any interference. All points are left open, to
be decided by the proper forum. The findings of the learned Judge and this
court are restricted to the disposal of the writ petition and the appeal and not
beyond.
The appellants are at liberty to approach the Port authorities for
resolution through mediation.
(SHAMPA SARKAR, J.)
(AJAY KUMAR GUPTA, J.)
sp/b.pal./tr
