Writ Petition Maintainable when State Behaves Arbitrarily under Realm of Contract- Supreme Court

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March 25, 2019

Case name: M/s Surya Constructions v. The State of Uttar Pradesh & ors.

In the present case, appellants have challenged the High Court’s order dismissing writ petition stating that disputed questions of fact arise in the case and that the amount due arises out of a contract.

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The present is a case in which payment for extra work by the Uttar Pradesh Jal Nigam has not been made though such work was expressly sanctioned and done to their satisfaction.

When the matter came before the Supreme Court, the Two-Judge Bench of the Court was of the view that the High Court’s verdict was wholly incorrect as there was no disputed question of fact and that the amount payable to the Appellant is wholly undisputed.

While delivering the verdict, the Apex Court also opined that where the State behaves arbitrarily, even in the realm of contract, the High Court could interfere under Article 226 of the Constitution of India[1].

In view of the aforesaid, the Supreme Court directed the Uttar Pradesh Jal Nigam to make the necessary payment within a period of four weeks from today.

The entire case can be accessed here.


[1] ABL International Ltd. and Another v. Export Credit Guarantee Corporation of India Ltd. and Others’ (2004 (3) SCC 553)