Dismissed

Jamal Uddin v. the State of Assam and 5 Ors.

Gauhati HC3 Mar 2022WP(C)/2574/2019

Case brief

AI extract

What is this about?

The High Court dismissed a writ petition filed by a borrower challenging the repossession of his vehicle by a private non-banking financial company. The Court held that the dispute was purely contractual and the respondent was not a State authority with public duties, rendering writ jurisdiction inapplicable.

What did the court decide?

Writ petition dismissed; no order as to cost; vehicle to be released in favor of respondent after due formalities.

Jamal Uddin Vs the State of Assam and 5 Ors. — Consumer Protection | Gauhati HC (2022)

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GAHC010083312019

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THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

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Writ Petition (C) 2574/2019

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Md. Jamal Uddin, S/o Abdul Khalek Village – Raumari, P.S. – Rupahi, District – Nagaon, Pin- 782125

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.….……….Petitioner

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Versus -

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The State of Assam

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represented by the Commissioner and Secretary to the Government of Assam, Home Department, Guwahati – 6

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The Superintendent of Police, Rupahi, District – Nagaon, Assam

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The Officer In-Charge, Rupahi Police Station, District – Nagaon, Assam

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Tata Capital Financial Service Limited, Regional Office at Flat no. 2C-2D, 2^nd Floor, South Block, 71 Park Street, Kolkata-700016 Represented by its constituted attorney,

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Mr. Rahul Tiwari to be served through the Branch Manager, Peace Enclave, 3^rd Floor, Ulubari, GS Road, Guwahati - 07

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The Branch Manager, Tata Capital Financial Service Limited, 3^rd Floor, Peace Enclave, Ulubari, G.S. Road, Guwahati – 781007, Ph. No. 913612130289

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Mr. Rahul Tiwari, constituted attorney of Tata Capital Financial Service Limited, to be served through the Branch Manager, Peace Enclave, 3^rd Floor, Ulubari, GS Road, Guwahati - 07

……………….Respondents

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Advocates :

Petitioner : Mr. M.U. Mahmud, Advocate, Respondent nos. 1–3 : Mr. N. Goswami, Junior Government Advocate Respondent nos. 4-6 : M. Sarma, Advocate

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Date of Hearing & Judgment : 03.03.2022

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BEFORE

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HON’BLE MR. JUSTICE MANISH CHOUDHURY JUDGMENT & ORDER [ORAL]

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The petitioner has approached this Court by this writ petition seeking invocation of the extra-ordinary and discretionary jurisdiction of this Court under Article 226 of the Constitution of India on the premise that a vehicle purchased by him from the respondent no. 4 pursuant to a loan agreement, had been re-possessed by the respondent no. 4 through the respondent no. 5 and the respondent no. 6 in an allegedly forcible manner.

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The case projected by the petitioner in this writ petition can be briefly stated as follows :-

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2.1. In the month of April, 2017, the petitioner approached the respondent no. 4 to provide him financial assistance to purchase an equipment vehicle, Maker’s name : Case New Holland India Private Limited bearing Engine no. 8045.45^* 735-191683 and Chassis no. NKJ770EMKGKH00737 [‘the subject-vehicle’, for short]. The respondent no. 4 agreed to provide financial assistance in the form of loan to the extent of Rs. 22,00,000/- to the petitioner to purchase the subject-vehicle. In that connection, a loan agreement was executed between the petitioner and the respondent no. 4 with certain terms and conditions. The petitioner has claimed that he had paid an amount of Rs. 7,47,000/- to the respondent no. 4 at the inception and thereafter, paid 12 nos. of subsequent installments, Rs. 7,04,000/in total, to the respondent no. 4 on different dates up to 25.01.2019. He has, thus, claimed that he had paid an amount of Rs. 14,51,000/- in total to the respondent no. 4 in respect of the loan agreement he had entered into with the respondent no. 4.

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2.2. It is the further case of the petitioner that the subject-vehicle was finally handed over to him on 30.05.2017 and at the time of delivery of the subject-vehicle, a temporary registration certificate was granted for the subject-vehicle and it was valid up to 29.06.2017. The petitioner had, thereafter, requested the respondent no. 4 and the respondent no. 5 to extend the validity period of the temporary registration certificate after 29.06.2017 but the said respondents did not provide no objection certificate [NOC] for extending the validity period of the temporary registration certificate. As a result, the petitioner could not ply the subject-vehicle properly in town areas for the purpose of earning his livelihood. All the representations made by the petitioner before the respondent no. 4 and the respondent no. 5 did not bring any favourable action from their ends.

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2.3. On 19.11.2018, the Arbitrator, appointed by the respondent no. 4, issued a notice from Kolkata. Though it was mentioned that along with the notice dated 19.11.2018, a Statement of Money Claim was annexed but no such Statement of Money Claim was supplied to the petitioner when he was served with the said notice. A legal notice dated 27.02.2019 was thereafter, received by the petitioner whereby the petitioner was asked to pay a sum of Rs. 18,43,589.98 along with penal interest, late payment and other charges in respect of the subject-vehicle. The legal notice made references to the terms and conditions of the loan agreement executed between the petitioner and the respondent no. 4.

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2.4. Thereafter, the petitioner received a summon from the Court of the learned Metropolitan Magistrate, 10^th Court, Kolkata whereby he was asked to appear before the said learned Court on 20.12.2018 in connection with a complaint case initiated against him for the offence under Section 138 of the Negotiable Instruments Act, 1881 [as amended].

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2.5. In view of progression of events in the aforesaid manner, the petitioner apprehended that the subject-vehicle might be re-possessed by the respondent no. 4 and thereafter, put in auction within a short period and in that event, he would sustain heavy loss as the subjectvehicle was his source of income. The apprehension of the petitioner regarding re-possession of the subject-vehicle became a reality when on 23.02.2019 the representatives of the

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respondent no. 4 took possession of the subject-vehicle in a forcible manner. The petitioner stated to have approached the Officer In-charge of Rupahihat Police Station on 27.02.2019 to lodge a First Information Report [FIR] against the respondent no. 4 and the respondent no. 5 but the Officer In-Charge, Rupahihat Police Station refused to accept the petitioner’s complaint.

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2.6. The petitioner has asserted that he was never provided with a copy of the loan agreement by the respondent no. 4. It was on 01.03.2019 that a notice was sent to the petitioner by a learned advocate from Kolkata whereby the petitioner was informed that the respondent no. 4, pursuant to the order passed by the learned Arbitrator in connection with an arbitration proceeding, had taken physical possession of the subject-vehicle through an appointed Receiver. The petitioner was thereby informed that the respondent no. 4, in order to sell the subject-vehicle, would move before the learned Arbitrator on 18.03.2019 or soon thereafter and the petitioner was requested to attend the next meeting before the learned Arbitrator. On receipt of the said notice dated 01.03.2019, the petitioner appeared before the learned Arbitrator and requested the representatives of the respondent no. 4 not to put the subject-vehicle in auction and sought some time to make payment of the outstanding loan amount after proper calculation. In view of such prayer made by the petitioner, the sale proceeding of the subject-vehicle was kept in abeyance for some time.

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2.7. By projecting as above, the petitioner has approached this Court seeking reliefs inter alia in the nature of [a] a direction to the respondent no. 4, the respondent no. 5 and the respondent no. 6 to provide the petitioner a copy of the loan agreement executed between the petitioner and the respondent no. 4 in respect of the subject-vehicle; [b] a direction to the said respondents to release the subject-vehicle in favour of the petitioner on payment of an amount of Rs. 1,00,000/-; and [c] also a direction to the said respondents to provide him the facility to make payment of the outstanding liability in the form of Equated Monthly Installment [EMI] of reasonable amount.

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I have heard Mr. M.U. Mahmud, learned counsel for the petitioner; Mr. N. Goswami, learned Junior Government Advocate, Assam for the respondent nos. 1, 2 and 3; and Mr. M.

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Sarma, learned counsel for the respondent nos. 4, 5 and 6.

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Mr. Mahmud, learned counsel for the petitioner has submitted that the petitioner had purchased the subject-vehicle for the purpose of earning his livelihood. At the time of entering into the loan agreement, the petitioner deposited a substantial amount to the extent of Rs. 7,47,000/- and during the subsequent period, he had deposited a number of installments, 12 nos. in total, to the respondent no. 4. He has submitted that the manner in which the possession of the subject-vehicle was taken by the respondent no. 4 through its agents is improper and illegal.

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4.1. He has submitted that the jurisdiction under Article 226 of the Constitution of India can be exercised in a matter where there is perceived illegality and high-handedness on the part of the respondent no. 4 and its agents/representatives/officials, etc. According to him, the respondent no. 4 is an authority who is duty bound to follow due procedure of law in taking possession of the subject-vehicle from a loanee like the petitioner. Though the loan contract agreement executed between the petitioner and the respondent no. 4 has provided for a remedy of arbitration, but presence of an arbitration clause does not always create a bar for the Court to exercise the extra-ordinary and discretionary jurisdiction under Article 226 of the Constitution of India when there is apparent illegality. In support of his such submissions, he has referred to the decisions of the Hon’ble Supreme Court of India in Harbanslal Sahnia and another vs. Indian Oil Corporation Limited and others, reported in [2003] 2 SCC 107, Para-7. He has also referred to a decision of a Division Bench of this Court in Neyville Engineering Associates and others vs. State of Assam, reported in [1997] 2 GLT 183, Para-5. To buttress his submission that the existence of an arbitration clause does not debar the Court from entertaining a writ petition, Mr. Mahmud, learned counsel for the petitioner has relied in the decision in Uttar Pradesh Power Transmission Corporation Limited and another vs. CG Power and Industrial Solutions Limited and another, reported in [2021] 6 SCC 15, Para-66.

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4.2. It is his further submission that the practice of taking possession of a vehicle provided under an agreement through the recovery agents has been deprecated by the Hon’ble

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Supreme Court of India in ICICI Bank Limited vs. Prakash Kaur and others, reported in [2007] 2 SCC 711, Paras-16 & 28. Relying on that decision, he has submitted that the act of re-possession of the subject-vehicle in the case in hand cannot be considered as a recovery by legal means. He has also referred to the decision of the Hon’ble Supreme Court of India in National Insurance Co. Ltd. vs. Keshav Bahadur and others, reported in [2004] 2 SCC 370.

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Per contra, Mr. Sarma, learned counsel for the respondent nos. 4, 5 and 6 has submitted that the respondent no. 4 is a company incorporated under the provisions of the Companies Act, 1956 and pursuant to the execution of the loan agreement, the petitioner was extended financial facility to purchase the subject-vehicle, subject to payment of Equated Monthly Installments [EMIs]. As the petitioner had defaulted in depositing the EMIs in time, a huge arrear had accumulated. In view of such accumulation of outstanding loan dues, the petitioner was initially served with a notice and thereafter, the respondent no. 4 invoked the Arbitration clause contained in the loan agreement. As an Arbitrator was appointed, the petitioner was informed accordingly. It was pursuant to an order dated 22.11.2018 of the learned Arbitrator, the subject-vehicle was taken into possession through the Regional Collection Manager of the respondent no. 4. The Regional Collection Manager was appointed by the learned Arbitrator to take possession of the subject-vehicle by the order dated 22.11.2018. It was on 23.02.2019, the respondent no. 4 had re-possessed the subjectvehicle. It was much prior to the appointment of the Arbitrator, the petitioner was informed by a notice dated 13.11.2017 that due to accumulation of outstanding dues, the petitioner should produce the subject-vehicle before the office of the respondent no. 5 within a stipulated time period. By submitting so, Mr. Sarma has further submitted that the subjectvehicle had been re-possessed by the respondent no. 4 by following due procedure and as such, this writ petition under Article 226 of the Constitution of India is misconceived and not maintainable. He has referred to the decision of the Hon’ble Supreme Court in Joshi Technologies International Inc. vs. Union of India and others, reported in [2015] 7 SCC 728, Para-69.

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I have duly considered the submissions of the learned counsel for the parties and have also perused the materials brought on record by the parties through their pleadings. I

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have also gone through the decisions cited at the bar by the learned counsel for the parties in support of their rival submissions.

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Before appreciation of the rival submissions in the context of the fact situation obtaining in the case, it would be apposite, even at the cost of repetition, to refer to the prayers made by the petitioner in the writ petition.

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7.1. The first prayer in the writ petition is for a direction in the nature of mandamus to the respondent no. 4, the respondent no. 5 and the respondent no. 6 to provide the petitioner with a copy of the loan agreement executed between the petitioner and the respondent no. 4 through the respondent no. 5 for providing the financial facility in the form of loan for the subject-vehicle.

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7.2. The second direction that the petitioner has sought for is the release of the subjectvehicle from the respondent no. 4, the respondent no. 5 and the respondent no. 6, subject to payment of an amount of Rs. 1,00,000/-.

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7.3. The third prayer that has been made by the petitioner in this writ petition is for a direction to the respondent no. 4 to provide the petitioner with the facility of making payment of the loan amount with a reasonable EMI.

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A copy of the loan agreement has already been annexed by the respondent nos. 4, 5 & 6 with their counter affidavit and as such, no further dilation is necessary on the first prayer. In order to consider the other two prayers, it appears necessary to find out the status of the respondent no. 4. From the loan agreement available on record, which has been annexed with the counter affidavit of the respondent nos. 4, 5 & 6, it is noticed that the loan agreement was executed between the respondent no. 4 and the petitioner on 31.05.2017. The respondent no. 4 viz. M/s Tata Capital Financial Services Limited is a company incorporated under the provisions of the Companies Act, 1956. The respondent no. 5 is an employee of the respondent no. 4 whereas the respondent no. 6, who has been impleaded by name, is a constituted attorney of the respondent no. 4.

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An incorporated company does not owe its existence to the Companies Act, 1956 and/or the Companies Act, 2013 [‘the Companies Act’, for short]. An incorporated company may be formed for any lawful purpose by seven or more persons, where the company to be formed is a public limited company, and two or more persons, where the company to be formed is a private limited company. The persons forming the company have to subscribe their names to a memorandum of association and by complying with the requirements of the Companies Act in respect of registration. Therefore, a company is incorporated under the Companies Act and not established under the Companies Act. A public limited company or a private limited company incorporated and registered under the Companies Act cannot be equated with a Corporation established by or under an Act. A public limited company or a private limited company, when it comes into the existence, is governed in accordance with the provisions of the Companies Act.

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Article 226 of the Constitution of India, which deals with powers of the High Courts to issue certain writs inter alia stipulates that every High Court has the power to issue directions, orders or writs to any person or authority, including, in appropriate cases, any Government, for enforcement of any of the rights conferred by Part III of the Constitution of India and for any other purpose. If an authority/body is ‘State’ within the meaning of Article 12 of the Constitution of India, a writ petition under Article 226 of the Constitution of India is maintainable against such an authority/body for the aforesaid purposes. The definition contained in Article 12 is for the purpose of application of the provisions contained in Part III. The provisions of Article 12 of the Constitution of India have provided that ‘the State’ includes the Government and Parliament of India and the Government and the Legislature of each of the States as well as all local or other authorities within the territory of India or under the control of the Government of India. If an authority/body falling within the purview of ‘other authority’ as per Article 12 of the Constitution of India violates the fundamental rights of any person or citizen, a writ petition can be filed under Article 226 of the Constitution of India invoking the extra-ordinary jurisdiction of the High Court seeking appropriate direction, order or writ. Thus, under Article 226 of the Constitution of India the power of the High Court is not limited to the Government or authority which qualifies to be ‘the State’ under Article 12 of the

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Constitution of India but is extended for issuing directions, orders or writs ‘to any person or authority’ also. Again, this power of issuing directions, orders or writs is not limited to enforcement of fundamental rights conferred by Part III, but also ‘for any other purpose’. Therefore, the power of the High Court takes within its sweep more authorities than stipulated in Article 12 of the Constitution of India and the subject-matter which can be dealt with under Article 226 of the Constitution of India is also wider in scope. The words ‘any person or authority’ used in Article 226 of the Constitution of India are not to be confined only to statutory authorities and instrumentalities of the State. They may cover any other person or authority/body performing public duty and it is the nature of duty imposed on the authority/body which is relevant. The guiding factor is the nature of duty imposed on such an authority/body, namely, public duty to make it covered under the ambit of Article 226 of the Constitution of India. The term ‘authority’ used in Article 226 of the Constitution of India has to receive wider meaning within the very term used in Article 12 of the Constitution of India.

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If a person or authority is ‘the State’ within the meaning of Article 12 of the Constitution of India, admittedly a writ petition under Article 226 of the Constitution of India would lie against such a person or an authority. But even in such cases writ would not lie to enforce private law rights. It is the basic principle of judicial review of an action under the administrative law. The reason is private law is that part of the legal system which is part of common law that involves relationships between individuals, such as law of contract. Thus, even if a writ petition is maintainable against an authority, which is ‘the State’ under Article 12 of the Constitution of India, before issuing the writ, particularly writ of mandamus, the Court has to satisfy that the action of such an authority, which is challenged, is in the domain of public law as distinguished from private law. Ordinary private law remedies are not enforceable through extra-ordinary writ jurisdiction. More particularly, contractual and commercial obligations are enforceable only by ordinary action and not by judicial review. It is also settled that even if a person or an authority does not come within the sweep of Article 12 of the Constitution of India, but is performing public duty, a writ petition can lie and a writ of mandamus or appropriate writ can be issued. Such a private body should either run substantially on State funding or discharge public duty/positive obligation of public nature or is under liability to discharge any function under any statute, to compel it to perform such a

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statutory function.

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The principle of judicial review prima facie governs the activities of bodies performing public functions. The only functions which are similar or closely related to those that are performed by the State in its sovereign capacity qualify as public functions or a public duty. A writ under Article 226 of the Constitution of India can lie against a person if it is a statutory body or performs a public function or discharges a public or statutory duty. It can be said that such functions which are similar to or closely related to those performable by the State in its sovereign capacity, can be defined as public functions or public duties. The scope of mandamus is limited to enforcement of public duty.

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Contracts of a purely private nature would not be subject to writ jurisdiction. Disputes or alleged breaches arising out of the terms of such contracts have to be settled by the ordinary principles of law of contract. The disputes about the meaning of a covenant or its enforceability have to be determined according to the usual principles of the Contract Act. The disputes relating to interpretation of the terms and conditions of a non-statutory contract or private contract cannot be agitated in a writ petition under Article 226 of the Constitution of India. Such kind of matter is to be adjudicated by a civil court or in arbitration, if provided in the contract.

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After two parties enter into the field of ordinary contract, the relations are not governed by the Constitutional provisions but by the legally valid contract which determines the rights, obligations and liabilities of the parties inter se. They can only claim rights conferred upon them by contract and are bound by the terms of the contract only. Where the contract entered into between two parties is a purely private contract then the rights, liabilities and obligations of the parties are governed by the terms of the contract and if one of the two parties complains about breaches of such contract by the other party no writ or order can be issued under Article 226 of the Constitution of India in such cases to compel the other private party to remedy a breach of contract pure and simple.

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It has been held as a settled proposition of law in Shalini Shyam Shetty and another

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vs. Rajendra Shankar Patil, reported in [2010] 8 SCC 329 that a writ petition is a remedy in public law which may be filed by any person but the main respondent should be either the Government or instrumentalities or agencies of a State within the meaning of Article 12. Private individuals or private entities cannot be equated with the State or instrumentalities or agencies of the State. All the respondents in a writ petition cannot be private parties. But private parties acting in collusion with State can be respondents in a writ petition. Under the phraseology of Article 226 of the Constitution of India, the High Court can issue writ to any person, but the person against whom the writ will be issued must have some statutory or public duty to perform.

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It has been observed as a settled proposition in law in Rajasthan State Industrial Development and Investment Corporation and another vs. Diamond & Gem Development Corporation Limited and another, reported in [2013] 5 SCC 470, that the matters/disputes relating to contract cannot be agitated nor terms of the contract can be enforced through the writ jurisdiction under Article 226 of the Constitution of India. Thus, a writ court cannot be a forum to seek any relief based on terms and conditions incorporated in the agreement by the parties.

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Reverting back to the facts of the case in hand, the respondent no. 4 is in the business of providing loans for the purpose of the individual needs of the loanee. The respondent no. 4 is a company incorporated and registered under the Companies Act, 1956. It is neither a State nor an instrumentality nor an agency of the State within the ambit and purview under Article 12 of the Constitution of India. The loan agreement executed between the respondent no. 4 and the petitioner is a pure and simple private contract without any kind of involvement of public elements. The petitioner purchased the subject-vehicle for the purpose of earning his livelihood. The rights, liabilities and obligations arising out of the contract are in the realm of private law which are to be governed by the ordinary laws of contract. The respondent no. 5 is an employee under the respondent no. 4 and the respondent no. 6 is a constituted attorney of the respondent no. 4. None of the two respondents, i.e. the respondent no. 5 and the respondent no. 6 discharges any kind of the public duty. The State respondents impleaded as the respondent no. 1, the respondent no. 2

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and the respondent no. 3 respectively have no role to play in the contract executed between the respondent no. 4 and the petitioner. There is no allegation in the entire writ petition to the effect that the respondent no. 1, the respondent no. 2 and the respondent no. 3 had entered into any kind of collusion with the respondent no. 4 or the respondent no. 5 or the respondent no. 6 at any point of time. The petitioner has not sought any kind of direction against the respondent no. 1 or the respondent no. 2 or the respondent no. 3. The petitioner has sought the directions, stated above, only against the respondent no. 4, the respondent no. 5 and the respondent no. 6, who either is a company, an entity in the private sector, or an individual discharging no public duties or obligations under any statute or otherwise.

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In Prakash Kaur [supra], the respondent who was the writ petitioner, took a loan from the ICICI Bank to purchase a truck. When the petitioner defaulted in payment of installments in terms of the agreement entered into between the petitioner and the Bank, the truck was taken into possession by the Bank authorities by use of force through third party who acted as an agent of the bank. The Hon’ble Supreme Court of India has observed that in case of default in payment of installments, the Bank is entitled to re-possess the vehicle in accordance with law. The Hon’ble Supreme Court has, however, deprecated the practice of hiring recovery agents and discouraged the same. It has been observed that in order to take possession of a vehicle in case where the borrower commits default in payment of the installments, the Bank should resort to proceedings recognized by law to take possession of such vehicle instead of taking resort to strong arm tactics.

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18.1. In the case in hand, there is no dispute to the fact that the loan agreement has contained terms and conditions relating to the events on default in Clause 17 and consequences of the events on default in Clause 18. Clause 23 has provided for arbitration. It has been set forth in Clause 23 that all disputes, differences and/or claims arising out of the loan agreement or as to the construction, meaning or effect thereof or as to the rights or liabilities of the parties shall be settled by arbitration to be held in Kolkata in accordance with the provisions of the Arbitration and Conciliation Act, 1996, as amended, and shall be referred to an Arbitrator. Clause 24 of the loan agreement has also provided for a procedure of dispute resolution whereby the parties have undertaken to use all reasonable endeavours to resolve

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any kind of disputes or differences amicably at first and if the disputes and differences cannot be settled amicably then the matter can be referred to the Arbitrator. It has not been denied by the petitioner that an arbitration proceeding has been initiated by the respondent no. 4 consequent upon default in payment of installments on his part as per the terms and conditions of the loan agreement. Prior to initiation of the arbitration proceeding with the appointment of an Arbitrator in the year 2018-2019, the respondent no. 4 had served a loan recall notice on 13.11.2017 upon the petitioner. It is, thus, not open for the petitioner to state that the respondent no. 4 did not intimate him about the defaults in payment of installments in terms of the loan agreement at an anterior point of time.

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18.2. The learned Arbitrator, during the course of the arbitration proceeding, had passed an order dated 22.11.2018 whereby one Mr. Sourav Kumar Sur, Regional Collection Manager of the respondent no. 4 was appointed as a receiver in respect of the subject-vehicle for the purpose of taking its possession. Pursuant to the said order dated 22.11.2018 of the learned Arbitrator, the appointed receiver re-possessed the subject-vehicle on 23.02.2019 and thereafter, he submitted a report before the learned Arbitrator on 26.02.2019 with an inventory report. The receiver is an employee of the respondent no. 4 in the capacity of Regional Collection Manager. Thus, it is prima facie evident that there is no engagement of any third party by the respondent no. 4 in re-possessing the subject-vehicle from the possession of the petitioner. In such view of the matter, the reference to the decision in Prakash Kaur [supra] is found not of relevance in the fact situation obtaining in the case in hand.

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In Harbanslal Sahnia [supra], the appellants were appointed as a dealer in petroleum products pursuant to an agreement dated 31.03.1994 entered into between the appellants and the Indian Oil Corporation Limited [IOCL]. On the allegation of impurity found in a sample of SKO collected from the retail outlet of the appellants during a visit by the officials of the IOCL on 15.12.1999, the appellants were served with a termination notice dated 06.09.2000 whereby the appellants’ dealership was terminated forthwith. The appellants filed a writ petition laying challenge to the order of termination. The High Court dismissed the writ petition on the ground that the relationship between the parties was contractual and the

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dealership agreement contained an arbitration clause and therefore, appropriate remedy available to the appellants was to have recourse to arbitration rather than invoking the writ jurisdiction of the High Court. When the appellants approached the Hon’ble Supreme Court, it was found that there was violation of the principles of natural justice on the part of the IOCL authorities and the grounds stated in the show-cause notice were found to be on irrelevant and non-existent facts. As the IOCL is an instrumentality of the State within the ambit of Article 12 of the Constitution of India, the Hon’ble Supreme Court of India has held that the rule of exclusion of writ jurisdiction due to availability of an alternative remedy is a rule of discretion and not one of compulsion. In an appropriate case in spite of availability of the alternative remedy, the High Court may still exercise its writ jurisdiction in at least three contingencies :- [i] where the writ petition seeks enforcement of any of the fundamental rights; [ii] where there is failure of principles of natural justice; or [iii] where the orders or proceedings are wholly without jurisdiction or the vires of an Act is challenged. None of the afore-mentioned three situations arose in the case of the petitioner to draw support from the decision in Harbanslal Sahnia [supra].

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The decision in Uttar Pradesh Power Transmission Corporation Limited [supra] is also on the same context. In Harbanslal Sahnia [supra], the Hon’ble Supreme Court of India has referred to the decision in Whirpool Corporation vs. Registrar of Trade Marks, reported in [1998] 8 SCC 1. In Uttar Pradesh Power Transmission Corporation Limited [supra], the Hon’ble Supreme Court of India has referred to the decisions in Whirpool Corporation [supra] and Harbanslal Sahnia [supra] to observe that the High Court may entertain a writ petition notwithstanding the availability of an alternative remedy :- [i] where the writ petition seeks enforcement of a fundamental right; [i] where there is failure of principles of natural justice; or [iii] where the impugned orders or proceedings are wholly without jurisdiction; or [iv] the vires of an Act is under challenge.

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As has been discussed above, the petitioner in this writ petition is seeking enforcement of his contractual rights. The rights, liabilities and obligations flowing out of a private contract cannot be brought within the scope and purview of public law. As a prior loan recall notice was issued to the petitioner and an arbitration proceeding was initiated as per

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the terms and conditions of the loan agreement which the petitioner had entered into on his own volition, prior to re-possessing of the subject-vehicle, it cannot be said that there is violation of principles of natural justice. There is also no question of the proceeding drawn up through arbitration is without jurisdiction and in breach of the covenants of the loan agreement. No vires of any statutory provision has been challenged by the petitioner. As such, the decisions in Harbanslal Sahnia [supra] and Uttar Pradesh Power Transmission Corporation Limited [supra] on which the petitioner has heavily relied, are found not applicable to the case of the petitioner. The decision in Keshav Bahadur [supra] pertains to the Motor Vehicles Act, 1939 and as such, the principle laid down therein is also not applicable to the facts and circumstances of the case in hand. The other decision referred to by the learned counsel for the petitioner are found not of relevance to the fact situations obtaining in the case in hand.

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The decision in Joshi Technologies [supra] pertains to two contracts executed by Joshi Technologies International Inc. with the Union of India, through the Ministry of Petroleum and Natural Gas [MoPNG] in the year 1992 relating to exploration of certain oilfields which the Union of India had selected in Gujarat and other States. The writ petition under Article 226 of the Constitution of India was filed against actions of the Income Tax authorities purportedly taken under the provisions of the Income Tax Act. The impugned actions were purportedly taken under the statutory provisions of the Income Tax Act, 1961. On the other hand, the loan agreement, at issue herein, is a private contract and the breach alleged by the petitioner does not have any semblance of statutory flavor or public character. In such view of the matter, the decision in Joshi Technologies [supra] is also not found applicable to the fact situations of the case in hand.

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From the reliefs sought by the petitioner in this writ petition, it is evident that the petitioner is seeking enforcement of the private contract, that is, the loan agreement in the manners which are favourable to him. The enforcement of the terms and condition of a contract which are in the realm of private law is not maintainable in the extra-ordinary writ jurisdiction of this Court under Article 226 of the Constitution of India. The Court in its writ jurisdiction does not create or modify a private contract between two private entities or one

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private entity and a private individual or two private individuals.

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The subject-vehicle is at present in the custody of the respondent no. 3 i.e. the Officer In-Charge, Rupahihat Police Station in terms of an order dated 12.04.2019 of this Court. The said order was passed in the writ petition which is filed at the instance of the petitioner. In view of the dismissal of the writ petition, the respondent no. 3 is directed to release the subject-vehicle in favour of the respondent no. 4 after observing due formalities.

¶87

In view of the discussions made above, this Court has found this writ petition filed under Section 226 of the Constitution of India by the petitioner as not maintainable and as a consequence, it is liable to be dismissed. Accordingly, the writ petition is dismissed. There shall be no order as to cost.

¶88

JUDGE

¶89

Comparing Assistant

Jamal Uddin v. the State of Assam and 5 Ors.

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Jamal Uddin v. the State of Assam and 5 Ors.

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