Significant Judgments


In the present case, the opposite party was selected as preferred bidder in the tender process for development of Bermunda Terminal. A concession agreement was executed between petitioner and opposite party for the same. Assailing the validity of such execution, a PIL was filed, whereon the High Court quashed the agreement holding it in contravention of Art. 229 of Constitution of India and concessionaire could thus not have any right over the land as the agreement was opposed to public policy as provided under Section 23 of Contract Act. The opposite party invoked the arbitration clause of the Concession Agreement and the Arbitrator was appointed by the High Court under Section 11 of Act. Petitioner filed an application under Section 16(2) of the Arbitration and Conciliation Act, 1996, which was rejected by the Tribunal vide impugned, which was assailed by the Petitioner via current petition.

The Court while relying on the case of Punjab State Power Corporation Limited v. Emta Coal Limited and Another, 2020 SCC Online SC 1165 observed that it should only interfere when the perversity stares on the face of the impugned order and no argument is required to be advanced to establish such perversity, which constitutes patent lack of inherent jurisdiction. The Court also noted the petitioner’s argument that with the quashing of cessation agreement, the arbitration agreement perished with it could not be termed as a patent lack of inherent jurisdiction, holding that even if the substantive contract is declared null and void, that does not automatically render the arbitration agreement void ab initio.

The Court held that since grounds of bad faith were not raised before Arbitral Tribunal and there was no perversity, the same could not be taken into consideration under Article 227 of Constitution, wherein the Court could have only interfered in case of a rare and exceptional circumstance which wasnot shown by petitioner to warrant interference. Hence, the Court held that the writ under Article 227 of the Constitution was not maintainable.

In the present case, the petitioners sought to assail the orders of Settlement Authorities under the Orissa Survey and Settlement Act, 1958 and despite having slightly distinct facts were heard together as all petitioners had been aggrieved by the question of law regarding non-compliance of the mandatory provisions of law by the settlement authorities.
The Court observed that non-issuance of the notifications to petitioners under Section 13(2) of the Act did not in any way take away the final publication of Record of Rights (ROR) under Section 12-B of the Act, wherein revision under Section 15(b) was thus maintainable under Section 12-B of the Act. In regards to maintainability, the Court held that Writ Court under Article 226 of the Constitution could interfere with an order passed by the statutory authority when it acts in a manner not recognised under law. The Court observed that the properties in question were settled under provisions of the O.G.L.S. Act, and the settlement authority had accepted the same, but the authority under the Act acted differently and passed the impugned orders which in effect cancelled the lease granted in favour of the beneficiary, which is not within the domain of the settlement authorities making the orders void. The Court also placed reliance on Lily Nanda v. State of Odisha, 2018(I) OLR 559, in favour of contention of the petitioners.

In light of the above, the Court noted that no action taken or publication made pursuant to the said void orders are also equally ineffective and have no nest in the eyes of law. The Court held the impugned orders and the RORs published thereof were held to be void and set aside.

In the present case, Superintending Engineer, Electrical Circle of the licensee allowed the application of the petitioner (consumer) to give benefit of Reduction in Contract Demand (RCD) from 5700 KVA to 3900 KVA which was also upheld by the Ombudsman to give such effect from 01.12.2015. The subsequent mutual agreement between the parties was to give effect to RCD from 19.05.2017 which was not in conformity with law in terms of Clauses 70 and 71 of the OERC Code, 2004. The petitioner filed the Writ Petition to question the legality and propriety of Letter No. WESCO 563 dated 17.12.2019 issued by Chief Operating Manager, WESCO Utility, refusing to accept the request of the Consumer to give benefit of Reduction in Contract Demand with effect from 1st December, 2015 and consequently rejecting the representation filed by the Consumer.

The Court held that the RCD could only be made effective from 01.12.2015 as the application of the consumer to licensee completed in all respects was made on 26.11.2015, wherein the terms and conditions of the mutual agreement executed on 19.05.2017 cannot take away the effect of law observing that law is well settled that there is no estoppel against law, wherein thus providing a different date in the agreement which is not in conformity with law, cannot be accepted, more particularly since the Consumer had raised an objection to the same. It also noted that the licensee being the creature of the statute had to act in accordance with the provision of law and not otherwise. Accordingly, the Court quashed the impugned letter of rejection refusing to accept the request of the consumer with directions to give effect to the RCD from 01.12.2015.