2020 (12) TMI 877 - KERALA HIGH COURT - Insolvency & Bankruptcy

Head Note / Extract:
Maintainability of petition - Works Contract - contract for the construction of certain portion of the Kochi Metro Project - privity of contract between DMRC and the petitioners - statement filed on behalf of the DMRC, contending that there is no privity of contract between DMRC and the petitioners and that the prayer in the writ petition being in the nature of a monetary claim, cannot be agitated in a writ petition filed under Article 226 of the Constitution of India - HELD THAT:- The contention of there being no privity of contract between DMRC and the petitioners to be well-founded. The mere fact that on the request of EIEL, some amounts were directly paid to the petitioners is not sufficient to hold the DMRC liable for the balance payments. As per the terms of the agreements entered into between the petitioner and EIEL, the amounts due to the petitioners is to be paid by EIEL. For the default committed by the said Company, the DMRC cannot be made liable, unless the bills are cleared and a request for direct payment made by EIEL and accepted by the DMRC. The Apex Court has reiterated the settled position that the remedy for violation of a term of contract is not under Article 226 of the Constitution of India. In Kurien E. Kalathil's case [2000 (7) TMI 920 - SUPREME COURT], the Apex Court observed that a contract would not become statutory simply because it is for construction of a public utility and was awarded by a statutory body and that like private parties, the statutory bodies also have power to contract or deal with property. The prayer for payment of the amounts due to the petitioners by the DMRC is liable to be rejected - Petition dismissed.