2024 INSC 398 NON-REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO(S). 14970-71 OF 2017

MUNICIPAL COMMITTEE KATRA

& ORS. .…APPELLANT(S)

VERSUS

ASHWANI KUMAR ….RESPONDENT(S)

JUDGMENT

Mehta, J.

1. The appellants seek to challenge the common judgment and

final order dated 30th September, 2015 passed by learned Division

Bench of Jammu and Kashmir High Court in LPAOW No. 20 of

2015 preferred by the appellants for assailing the order dated 20th

February, 2015 passed by the learned Single Judge in OWP No.

1199 of 2013; and in LPAOW No. 21 of 2015, filed by the

respondent seeking modification of the order dated 20th February,

2015. The learned Division Bench disposed of the LPAOW No. 20

of 2015 preferred by the appellants, whereas the cross-appeal

Signature Not Verified

Digitally signed by

preferred by the respondent being LPAOW No. 21 of 2015 was

Narendra Prasad
Date: 2024.05.09
14:21:17 IST
Reason:

dismissed.

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2. The brief controversy presented for adjudication in these

appeals is whether the High Court in exercise of writ jurisdiction,

was entitled to entertain a dispute which was purely civil in nature

filed for claiming monetary relief/damages arising from fallout of

contractual obligations.

3. Brief facts relevant and essential for disposal of these appeals

are that the appellant-Municipal Committee, Katra issued a Notice

Inviting Tender(hereinafter being referred to as ‘NIT’) dated 3rd

March, 2010 inviting bids for supply of mules and mazdoors

essentially involved in transportation of pilgrims from the base

camp at Katra to holy shrine of Mata Vaishno Devi, atop the

Trikuta hill. Several bids were received in response to the said NIT.

The respondent herein was the second highest bidder, who

subsequently became the highest bidder, as Shri Pritam Das, the

original highest bidder did not come forward to execute the

contract. Accordingly, the contract came to be offered to the

respondent who accepted the offer so given. The tenure of the

contract as per NIT was from 1st April, 2010 till 31st March, 2011.

In terms of Clause-8 of the NIT, the successful bidder was required

to deposit 40% of the bid amount within 24 hours from the time of

acceptance, i.e. on or before 31st March, 2010. It was also enjoined

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upon the bidder to deposit 5 post dated cheques along with bank

guarantee to secure the amount for remaining tenure of the

contract period.

4. Clause-8 of NIT would be germane to the controversy and is

being reproduced hereinbelow for the sake of ready reference: -

“8. The successful highest bidder, shall have to deposit 40% of

the offered amount at the time of provisional acceptance of the
offer by the committee immediately but not later than 24 hours
from the time of acceptance. Balance contract amount shall
have to be deposited in 5 (five) equal installments commencing
from 1st May to September 2010, in shape of post dated
cheques along with bank guarantee to be deposited within 24
hours from the time of acceptance of offer to secure timely
realization the consideration amount. In case of default to
deposit 40% of bid offered amount within 24 hours and also
fails to fulfill other formalities required as per terms and
conditions, the security deposit/earnest money shall be
forfeited."

5. The respondent sought relaxation in the Clause-8 of the NIT

on the ground that the condition of furnishing bank guarantee for

the remainder amount was unjust and arbitrary.

6. Having failed to get a favourable response from the Municipal

authorities, the respondent filed a civil suit seeking a declaration

that Clause-8 of the NIT was arbitrary. The suit was accompanied

by an application seeking temporary injunction. The Court of

learned District Judge, Reasi vide order dated 29th April, 2010,

allowed the application and granted temporary injunction

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directing the appellants herein to issue the order of allotment of

contract to the respondent-plaintiff.

7. The defendants i.e. appellants herein challenged the order

dated 29th April, 2010 by filing a Civil 1st Miscellaneous

Appeal(CIMA) No.312 of 2010 wherein the High Court passed an

order dated 7th May, 2010 directing the appellants to issue a work

order in favour of the respondent.

8. In view of the order dated 7th May, 2010 passed by the High

Court in the above appeal, a formal work order dated 10th May,

2010 was issued by the appellants to the respondent who

commenced the work and collected the revenue for the period

commencing from 10th May, 2010 till 7th April, 2011(time of one

week extended under orders of the High Court). After conclusion

of the contract period, the respondent filed a writ petition before

the High Court being OWP No. 743 of 2013 contending that his

contract was supposed to commence from 1st April, 2010 and was

to run for a period of 365 days till 31st March, 2011. However, the

said period was truncated because the same could be commenced

from 10th May, 2010 only and hence, the respondent suffered a

loss of collection of earnings for a period of 33 days. He, therefore,

claimed pro-rata amount of Rs. 71,06,276/- being the purported

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loss suffered on account of the curtailment of the contract period

by 33 days. The learned Single Bench of the High Court, vide order

dated 3rd July, 2013, disposed of the writ petition, OWP No.743 of

2013 with a direction to the appellants herein to consider the claim

of the respondent within six weeks from the date of the order.

9. The claim of the respondent was laid before the Executive

Officer, Municipal Committee, Katra who rejected the same vide

order dated 12th August, 2013 which was subjected to challenge in

OWP No. 1199 of 2013.

10. The learned Single Bench, took up the OWP No.1199 of 2013

and decided the same vide order dated 20th February, 2015. The

findings recorded by the learned Single Judge in paragraph Nos.

14 to 16 of the order are relevant for adjudication of the issue at

hand and hence, are being reproduced hereinbelow: -

“14. Indisputable position, thus, emerging is that, whereas the

petitioner had complied with clause-8 of the auction notice to
the extent of offering 40% of the auction amount by way of a
cheque, he, however, had failed to comply with rest of the
conditions by not issuing five post dated cheques and bank
guarantee to secure the payment of rest of the auction amount
and instead questioned the legality of clause-8 by filing suit in
the court of learned District Judge, Reasi. It was for this failure
on the part of the petitioner that allotment letter enabling him
to start performing under the contract from 01.04.2010 was not
issued by respondent No.3, which, nonetheless, later came to
be issued on 10.05.2010 pursuant to and in compliance with
order dated 07.05.2010(supra) passed by this Court. As the
contract period had to come to an end with the end of the
financial year, that is, on 31.03.2011, the petitioner again
approached this Court by way of CMA No. 271/2011 in the

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above mentioned appeal (CIMA No. 312/2010) and because of
the interim direction issued by this Court on 31.03.2011, he
continued performing under the contract up to 07.04.2011
when, however, the interim direction ceased to operate due to
withdrawal of appeal by the respondents. Fact of the matter,
thus, precisely is that as against stipulated contract period of
one year from 01.04.2010 to 31.03.2011 the petitioner could
perform under the contract and earned revenue from
10.05.2010 to 07.04.2011 and in that petitioner is not wrong
in saying that he worked 33 days less than the stipulated
contract period of 365 days. He thus sought refund of
proportionate auction amount for these 33 days, firstly, by the
medium of OWP No. 743/2013 and now by the medium of the
petition on hand in which he also questions order dated
12.08.2013 passed by respondent No. 3 in compliance with
order dated 03.07.2013 passed by this Court in OWP No.
743/2013. Respondent No.3, by impugned order dated
12.08.2013, rejected petitioner’s claim holding it as not
maintainable solely for the reason that petitioner himself was
at fault for not fulfilling the terms and conditions of the Auction
Notice.

15. Point sought to be demonstrated on behalf of the

respondents is that petitioner by not issuing post dated
cheques and bank guarantee to secure the payment of
remaining 60% of the total auction amount was responsible for
non-issue of allotment letter and allotment of contract in his
favour up to 10.05.2011 and therefore is not entitled to claim
recovery of proportionate auction amount.

16. It admits of no doubt that petitioner himself was responsible

for delay in allotment of contract in his favour resulting into his
inability to collect the revenue for initial period of 39 days, that
is, from 01.04.2010 to 09.05.2010. Respondents cannot be said
to have committed any wrong, illegality or breach of contract in
not issuing allotment letter and allotting the contract to the
petitioner from 01.04.2010 up to 09.05.2010. It was with the
intervention and under the interim directions of this Court on
07.05.2010(supra) that the respondent No. 3 allotted the
contract in favour of the petitioner on 10.05.2010 and he
performed under the same up to 7. 4. 2011. This, however, is
one aspect of the matter and the other aspects, which are
important nevertheless, are that stipulated period of the
contract was twelve months, the, auction amount offered and
paid by the petitioner was for the said period of twelve months
and the petitioner could not collect the revenue for 32 days out
of the said twelve months.”

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11. The learned Single Judge recorded a categoric finding that it

was the respondent herein who failed to comply with the

requirements of the Clause-8 of the NIT because the five post-dated

cheques and bank guarantee to secure the payment of the rest of

the auction amount were not deposited by him leading to non-

issuance of the work order. The respondent questioned the legality

of the Clause-8 by filing a suit in the Court of learned District

Judge, Reasi. The learned Single Judge categorically held that it

was the failure of the respondent-bidder, due to which the

allotment letter enabling him to start performing under the

contract from 1st April, 2010 was not issued, which later came to

be issued on 10th May, 2010 in compliance of the order dated 7th

May, 2010 passed by the High Court. However, in spite of taking

note of this unjustified action of the respondent leading to the non-

issuance of the work order, the learned Single Judge went on to

hold that the writ petitioner(respondent herein) was not wrong in

saying that he had worked 33 days less than the stipulated

contract period of 365 days and thus, he was entitled to payment

of pro-rata auction amount for these days.

12. The learned Single Judge was persuaded by the equitable

concept that a social welfare state where the Government has to

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play a key role in protecting and promoting the economic interest

and social well-being of the citizens, it would not be entitled to or

justified in earning undue benefit/profit from the citizens.

Observing so, the learned Single Judge took upon himself to

quantify the damages suffered by the bidder to be equivalent to net

revenue collected by the appellant herein during first 32 days of

contract period commencing from 1st April, 2010 after deducting

expenses such as salaries and allied expenses and proceeded to

direct the appellants to make payment thereof to the respondent

herein.

13. The intra court appeal preferred by the appellants against the

said order and the cross-appeal filed by the respondent seeking

modification of the order passed by learned Single Bench and a

direction upon the appellant to refund the total amount of

Rs.71,06,276/- along with interest at 12% per annum without

making any deductions, stand rejected by common judgment and

final order dated 30th September, 2013. These orders are subjected

to challenge at the instance of Municipal Committee, Katra and its

officials in these appeals by special leave.

14. Learned counsel Shri Pashupathi Nath Razdan appearing on

behalf of the appellants urged that admittedly, the respondent was

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responsible for non-issuance of the work order because he did not

comply with the mandatory requirements contained in Clause-8 of

NIT. Despite having participated in the auction proceedings with

open eyes, the respondent pursuant to his second highest bid

being accepted, challenged the conditions contained in Clause-8 of

the NIT, by filing a civil suit. Owing to the reluctance shown by the

respondent in accepting the tender conditions, the appellants

herein were contemplating to quash the tender and to issue a fresh

auction notice, but in compliance of the order dated 7th May, 2010,

passed by the High Court, the work order dated 10th May, 2010

was awarded to the respondent. He submitted that there cannot

be any dispute that the work under the contract was to run only

till 31st March, 2011. The work was commenced by the respondent

on 10th May, 2010 and the delay was due to his own conduct. He

submitted that the High Court was not justified in entertaining the

claim laid by the respondent in the writ petition which primarily

was filed seeking award of damages in exercise of the extraordinary

writ jurisdiction. It was fervently contended that such a remedy

could only have been availed by filing a suit for damages in the

civil Court. His fervent contention was that the quantification of

the amount, arrived at by the High Court to be awarded to the

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respondent by way of damages/compensation was not based on

any logic or reasoning. He thus, implored the Court to accept the

appeals and set aside the impugned judgments.

15. Per contra, Mr. Rakesh K. Khanna, learned senior counsel

representing the respondent-writ petitioner, vehemently and

fervently opposed the submissions advanced by the appellants’

counsel. He urged that admittedly, the auction notice was issued

for one year, but despite that the respondent was not allowed to

work for the entire period of 365 days in terms of NIT. For the

shortfall of 33 days during which the respondent-writ petitioner

was not allowed to work, the appellants themselves operated the

work and thus, it can be presumed that they must have made

profits out of the same. He urged that the respondent-writ

petitioner was made to deposit the entire amount under the

contract for the full period of 365 days in terms of the NIT. The

appellant Municipal Committee operated the work and earned

income for this period of 33 days and also charged the respondent-

writ petitioner for the same period. By failing to pay to the

respondent-writ petitioner the earnings for the period of these 33

days, the appellant was unduly enriched which is totally alien to

the concept of a ‘welfare state’ guaranteed under the Constitution

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of India. He submitted that the High Court has assessed and

quantified the damages suffered by the respondent by applying a

logical reasoning and granted equitable relief after balancing the

equities and hence, this Court should be loath to interfere in the

matter.

16. However, Mr. Khanna was not in a position to dispute the fact

that the respondent did not challenge the conditions contained in

Clause-8 of NIT before participating in the auction proceedings. It

was also not disputed that the delay in issuance of the work order

was purely attributable to the respondent who avoided complying

with the conditions in Clause-8 of the auction notice and dragged

the proceedings to litigation.

17. We have considered the submissions advanced at bar and

have perused the material available on record and have gone

through the impugned judgments.

18. The situation at hand is squarely covered by the latin maxim

‘nullus commodum capere potest de injuria sua propria’, which

means that no man can take advantage of his own wrong. This

principle was applied by this Court in the case of Union of India

v. Maj. Gen. Madan Lal Yadav 1 observing as below: -

1 (1996) 4 SCC 127

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 “28. …In this behalf, the maxim nullus commodum capere potest
de injuria sua propria — meaning no man can take advantage of
his own wrong — squarely stands in the way of avoidance by the
respondent and he is estopped to plead bar of limitation contained
in Section 123(2). In Broom's Legal Maxim (10th Edn.) at p. 191 it
is stated:

“… it is a maxim of law, recognised and established, that no man

shall take advantage of his own wrong; and this maxim, which is
based on elementary principles, is fully recognised in courts of law
and of equity, and, indeed, admits of illustration from every
branch of legal procedure.”

The reasonableness of the rule being manifest, we proceed at once

to show its application by reference to decided cases. It was noted
therein that a man shall not take advantage of his own wrong to
gain the favourable interpretation of the law. In support thereof,
the author has placed reliance on another maxim frustra legis
auxilium invocat quaerit qui in legem committit. He relies on Perry
v. Fitzhowe [(1846) 8 QB 757 : 15 LJ QB 239] . At p. 192, it is
stated that if a man be bound to appear on a certain day, and
before that day the obligee puts him in prison, the bond is void.
At p. 193, it is stated that “it is moreover a sound principle that
he who prevents a thing from being done shall not avail himself of
the non-performance he has occasioned”. At p. 195, it is further
stated that “a wrong doer ought not to be permitted to make a
profit out of his own wrong”. At p. 199 it is observed that “the rule
applies to the extent of undoing the advantage gained where that
can be done and not to the extent of taking away a right previously
possessed”.

19. It is beyond cavil of doubt that no one can be permitted to

take undue and unfair advantage of his own wrong to gain

favourable interpretation of law. It is a sound principle that he who

prevents a thing from being done shall not avail himself of the non-

performance he has occasioned. To put it differently, ‘a wrong doer

ought not to be permitted to make profit out of his own wrong’. The

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conduct of the respondent-writ petitioner is fully covered by the

aforesaid proposition.

20. The respondent-writ petitioner participated in the tender

process without raising any issue about Clause-8 of the auction

notice. The highest bidder Shri. Pritam Das did not come forward

to execute the contract thus, the respondent became the highest

bidder and was offered the work in question. The respondent

accepted the same with open eyes. However, in order to avoid full

compliance of Clause-8 of auction notice, the respondent went on

to file a civil suit. Having participated in the tender proceedings

with open eyes, the respondent challenged the Clause-8 of the

auction notice in the civil Court and thereby, stalled the issuance

of the work order. The matter was taken to the High Court and the

appellants gave a clear indication before the High Court that they

were proposing to hold a fresh auction. However, during pendency

of appeal before the High Court, an order dated 7th May, 2010 came

to be passed whereby, the appellants were directed to award the

work to the respondent being L-2.

21. We feel that once the respondent-writ petitioner had

participated in the tender process being fully conscious of the

terms and conditions of the auction notice, he was estopped from

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taking a U-turn so as to question the legality or validity of the

terms and conditions of the auction notice. By dragging the matter

to litigation, the respondent himself was responsible for the delay

occasioned in issuance of the work order which deprived him of

the opportunity to work for the entire period of 365 days.

22. Furthermore, the relief which was sought by the respondent

in the writ petition was purely by way of damages. By no stretch of

imagination, such relief could have been subject matter of extra

ordinary writ jurisdiction of the High Court under Article 226 of

the Constitution of India. The quantification of the damages would

require entering into disputed questions of facts and hence, the

High Court ought to have relegated the writ petitioner(respondent

herein) to the competent Court for claiming damages, if so advised.

23. Law is well settled that disputes arising out of purely

contractual obligations cannot be entertained by the High Court in

exercise of the extra ordinary writ jurisdiction. In the case of Union

of India and Ors. v. Puna Hinda2, this Court held as follows: -

“24. Therefore, the dispute could not be raised by way of a writ

petition on the disputed questions of fact. Though, the
jurisdiction of the High Court is wide but in respect of pure
contractual matters in the field of private law, having no
statutory flavour, are better adjudicated upon by the forum
agreed to by the parties. The dispute as to whether the amount
is payable or not and/or how much amount is payable are

2 (2021) 10 SCC 690

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 disputed questions of facts. There is no admission on the part
of the appellants to infer that the amount stands crystallised.
Therefore, in the absence of any acceptance of joint survey
report by the competent authority, no right would accrue to the
writ petitioner only because measurements cannot be
undertaken after passage of time. Maybe, the resurvey cannot
take place but the measurement books of the work executed
from time to time would form a reasonable basis for assessing
the amount due and payable to the writ petitioner, but such
process could be undertaken only by the agreed forum i.e.
arbitration and not by the writ court as it does not have the
expertise in respect of measurements or construction of roads.”

24. In wake of discussion made herein above, this Court is of the

firm view that the impugned judgments dated 20th February, 2015

and 30th September, 2015 are ex-facie illegal and without

jurisdiction. Hence, the same deserve to be and are hereby

quashed and set aside.

25. The appeals stand allowed. No order as to costs.

26. Pending application(s), if any, stand disposed of.

………………….……….J.
(B.R. GAVAI)

………………………….J.
(SANDEEP MEHTA)
New Delhi;
May 09, 2024

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