TMI Blog2020 (4) TMI 884X X X X Extracts X X X X X X X X Extracts X X X X ..... e claims of the petitioners for performing Cloud Seeding operations for the years 2007, 2008 and 2009 is barred by limitation, is without any merit. Locus of the 2nd petitioner to claim the amounts due to the 1st petitioner - Firm - HELD THAT:- In view of the clear provision in Section 47 of the Indian Partnership Act, 1932, the payments due to the 1st petitioner-Firm can certainly be made to the 2nd petitioner and such payments would bind the 1st petitioner as well. Distribution of the liability between the new State of Telangana and the residuary State of Andhra Pradesh - HELD THAT:- According to Clause (b) of sub-section (1) of Section 60, the liability has to be apportioned between the new State of Telangana and the residuary State of Andhra Pradesh in the ratio 41.68 : 58.32, i.e., the liability of the State of Telangana (respondent No. 1) would be 41.68 % of the total liability and the liability of the State of Andhra Pradesh (respondent No. 2) would be 58.32% of the total liability. The Writ Petition is allowed with costs of ₹ 25,000/- and respondent Nos. 1 and 2 are directed to pay in three (03) months the arrears of dues under the Cloud Seeding contracts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... increasing rainfall over a target area in a safe and efficient manner and also to conduct research studies for scientific studies of the cloud physics of the region; and the then Government of Andhra Pradesh had, through a tender Committee had selected the 1st petitioner to conduct the precipitation enhancement program. 7. Thus there is not even an iota of doubt that there is a clear public law element involved in the Cloud Seeding operations to be done by the 1st petitioner and public interest would greatly stand to benefit if they were done. The first contract dt. 4.7.2007 8. On 19.06.2007, the then undivided State of Andhra Pradesh, through the Jawaharlal Nehru Technological University (3rd respondent), issued a tender notification for 'Cloud-Seeding Operations'. 9. The 1st petitioner submitted bid and deposited earnest money of ₹ 50 lakhs. 10. A Committee constituted for the said purpose selected the 1st petitioner Firm and after due deliberations and negotiations, a contract was signed on 04.07.2007 by the 3rd respondent with the 1st petitioner for contract value ₹ 20.79 crores. 11. The Cloud Seeding Operation were to be taken in 10 distr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the 3rd respondent on 20.07.2009 for taking up said operations in the above 12 districts costing ₹ 25,40,57,800/-. The 1st petitioner successfully carried out the said operations also. Only part payment was made to the 1st petitioner leaving a balance of ₹ 18,94,94,517/-. The dues payable according to petitioners 21. For 2007-08, as against total dues of ₹ 22,16,05,956/-, petitioners contend that ₹ 21,46,92,000/- was paid leaving a balance of ₹ 69,13,956/-. 22. For 2008-09, according to 1st petitioner, it has to be paid ₹ 20,64,38,907/-. 23. For 2009-10, as against contractual value of ₹ 25,41,57,800/-, ₹ 18,94,94,517/- is payable by the respondents. 24. So, in all ₹ 40,28,47,380/- out of ₹ 49,26,00,000/- is payable according to petitioners. 25. Petitioners rely on copies of the note file furnished to the petitioners by the Assistant Secretary to the Government, Finance on 30.09.2013 (Page 44) and upon other information furnished on 21.01.2014 also under the Right to Information Act, 2005 which are filed as Annexures XVII and XVIII in this regard. Contentions of petitioners 26. According to peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 2nd petitioner and the other partner Sri Arvind Sharma which were adjudicated by a sole arbitrator on 19.10.2013 by consent memo permitting the 2nd petitioner alone to collect payment and to issue valid receipt to the agencies for the payments payable to the 1st petitioner (Annexures XXX and XXXI). 34. According to the petitioners, it had executed the Cloud Seeding operations by obtaining loans from financial institutions and incurring huge interest burden thereon and the action of the respondents in not releasing payments due to the petitioners is arbitrary and illegal and the respondents are to be directed to pay back the same with interest @ 18% per annum; and that both respondents ought to share the liability jointly and severally. Events after filing of the Writ Petition 35. The matter was first listed before a learned Single Judge on 19-1-2016 and the 3rd respondent's Standing Counsel took notice and notices were directed to be taken out to respondents 1 and 2. Though the case was adjourned to 8-2-2016, it was listed only on 17-8-2016. At request of petitioner's counsel it was adjourned to 18-8-2016. 36. On 18-8-2016, the Court directed the Advocates Gen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his contention is without any merit because the Supreme Court in ABL International Ltd. and another Vs. Export Credit Guarantee Corporation of India Ltd. and others (2004) 3 SCC 553 has held that merely because one of the parties to the litigation raises a dispute in regard to the facts of the case, the Court entertaining a petition under Article 226 of the Constitution of India is not always bound to relegate the parties to a suit; and that in an appropriate case, Writ Court has jurisdiction to entertain a Writ Petition involving disputed questions of fact and there is no absolute bar for entertaining a Writ Petition even if the same arises out of a contractual obligation and/or involves some disputed questions of fact. It held that merely because a question of fact is raised, the High Court will not be justified in requiring the party to seek relief by the somewhat lengthy, dilatory and expensive process by a Civil Suit against a Public Body. 50. This decision was reiterated recently in Popatrao Vyankatrao Patil Vs. State of Maharashtra and others Civil Appeal No. 1600 of 2020 decided on 14.02.2020 by a Three Judge Bench headed by Chief Justice of India, Justice B.R. Gavai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 40,28,47,380/- has to be paid to the 1st petitioner for Cloud Seeding operations for 2007-08, 2008-09, 2009-10. 57. The Note File C. No. 327/RS-II/09 (at running page 204 to 211 of the paper book filed by the petitioners) records on 29.08.2011 from page 43 onwards details of the work done by the petitioners for 2007, 2008 and 2009, that ₹ 69,13,956/- is payable to the 1st petitioner for 2007-08, that ₹ 22,67,88,907/- ought to be paid after deducting ₹ 2,03,50,000/- for violating orders to shift the aircraft from Bangalore to Tirupati (i.e. ₹ 20,64,38,907/-) and for 2009-10, the 1st petitioner has to be paid ₹ 18,94,94,517/- and that the total amount payable to 1st petitioner is ₹ 40,28,47,380/-. 58. At page 68 of Note File C. No. 327/RS.II/2009 on 18.07.2012 (running page 229 of the paper book filed by the petitioners) also it is stated that ₹ 40,28,47,380/- is payable to the 1st petitioner. 59. On 20.06.2011, Centre for Atmospheric Sciences and Weather Modification (Cloud Seeding) Technologies of the 3rd respondent University informed the Principal Secretary of the Rain Shadow Area Development Department of the composite Sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioners in 2007,2008 and 2009. 66. On 02.05.2014, vide letter No. 164/RS.II/2014, the Secretary to the Government of Rain Shadow Area Development Department of the composite State of Andhra Pradesh replied to the legal notice issued by the petitioners through M/s. Juris Consult (Advocates) on 11.04.2014 that the matter of balance payment to M/s. Agni Aviation Consultants for conducting Cloud Seeding operations for 2007, 2008 and 2009 is under consideration and awaiting for certain clarifications from the Vice Chancellor, JNTU, Hyderabad . 67. The petitioners have also relied upon D.O. Letter No. 153/RS.II/2010 dt. 13.09.2010 written by the Secretary to the Government of Rain Shadow Area Development Department of the composite State of Andhra Pradesh to the Principal Accountant General (Civil Audit), Andhra Pradesh with copy marked to the Coordinator, Centre for Atmospheric Sciences and Weather Modification (Cloud Seeding) Technologies of the 3rd respondent University certifying as under: 8. Conclusion: From the above information it can be inferred that Cloud Seeding Operations are backed by a sound research, has worldwide acceptance and application in enhan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Pimpri Chinchwad New Township Development Authority (2018) 8 SCC 215, at page 225 (Supra) related to withdrawal of a Notification issued under the Land Acquisition Act, 1894 after possession of the land acquired was taken by the State and it considered the question whether noting on the file by a Minister to release the land could be taken to be the decision of the Government. The Court held that the Minister had no such power and he had usurped the power of the Government. 72. Assuming that notings in the File of State Government do not create any right in favour of the person, such notings in File can certainly be relied upon as 'acknowledgements of liability' under Sec. 18 of the Limitation Act, 1963. This is because, as held in Shapoor Freedom Mazda v. Durga Prasad Chamaria AIR 1961 SC 1236, an acknowledgement, as prescribed in Sec. 19 of the Limitation Act, 1908 (which is in pari materia with Sec. 18 of the Limitation Act, 1963) merely renews a debt and it does not create a new right of action. It is a mere acknowledgement of the liability in respect of the right in question. 73. In the instant case, the Note File copies obtained under the Right to Informati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 's decision in Urban Improvement Trust, Bikaner vs. Mohan Lal (2010) 1 SCC 512. 80. In Urban Improvement Trust, Bikaner (2010) 1 SCC 512 (supra) the Supreme Court has criticized the attitude of Government officials in deliberately delaying taking crucial decisions affecting citizens and then contesting the same on technical pleas without justification. It declared: 5. ... ... Statutory authorities exist to discharge statutory functions in public interest. They should be responsible litigants. They cannot raise frivolous and unjust objections, nor act in a callous and high-handed manner. They can not behave like some private litigants with profiteering motives. Nor can they resort to unjust enrichment. They are expected to show remorse or regret when their officers act negligently or in an overbearing manner. When glaring wrong acts by their officers are brought to their notice, for which there is no explanation or excuse, the least that is expected is restitution/restoration to the extent possible with appropriate compensation. Their harsh attitude in regard to genuine grievances of the public and their indulgence in unwarranted litigation requires to be corrected. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... air and just to the citizens. Of course, if a Government or a public authority takes up a technical plea, the Court has to decide it and if the plea is well founded, it has to be upheld by the court, but what we feel is that such a plea should not ordinarily be taken up by a Government or a public authority, unless of course the claim is not well founded and by reason of delay in filing it, the evidence for the purpose of resisting such a claim has become unavailable. 9. In a three-Judge Bench judgment of Bhag Singh v. UT of Chandigarh 1985 (3) SCC 737 this Court held: (SCC p. 741, para 3) 3. ... The State Government must do what is fair and just to the citizen and should not, as far as possible, except in cases where tax or revenue is received or recovered without protest or where the State Government would otherwise be irretrievably be prejudiced, take up a technical plea to defeat the legitimate and just claim of the citizen. 10. Unwarranted litigation by Governments and statutory authorities basically stems from the two general baseless assumptions by their officers. They are: (i) All claims against the Government/statutory authorities should be viewed as ill ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ute finding fault with the High court which denied it under Art. 226 of Constitution of India. 85. Therefore we reject this contention of the respondents. Plea of bar of Limitation 86. The next contention raised by the 1st respondent, i.e., the State of Telangana is that the claim of the Writ Petitioner is barred by limitation. The instant Writ petition was filed by the petitioners on 7.1.2016. 87. As mentioned supra in para 32, Clause 3.3 of each of the Cloud Seeding contracts for 2007, 2008 and 2009 specified that petitioners would be paid ₹ 20,79,00,400/- (2007), ₹ 22,86,90,400/- (2008) and ₹ 25,40,57,800/- (2009). Schedule of payment is also mentioned in all three contracts. The said clause states: ... (a) Mobilization Payment : 35% of the fixed contract price of each equipment shall be paid after that equipment is deployed at each location. (b) Balance Payments : Balance payments will be given in equal instalments, every 10 days. (c) FSD (Fixed Security Deposit) at the rate of 5% will be recovered in each bill, except mobilization advance if taken. Upon receipt by the Department of the final report, this amount will be released. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has not yet come or is accompanied by a refusal to pay, delivery, perform or permit to enjoy, or is coupled with a claim to set-off, or is addressed to a person other than a person entitled to the property or right; (b) the work 'signed' means signed either personally or by an agent duly authorized in this behalf; and (c) an application for the execution of a decree or order shall not be deemed to be an application in respect of any property or right. 95. Another relevant provision in the Limitation Act, 1963 is Section 19 which states that if payment on account of a debt is made before the expiration of the prescribed period by the person liable to pay the debt, a fresh period of limitation shall be computed from the time when the payment was made. Cases dealing with Section 18 where important principles were laid down: 96. In Food Corpn. of India v. Assam State Coop. Marketing Consumer Federation Ltd. 2004) 12 SCC 360, the Supreme Court held that to amount to an acknowledgment of a liability within the meaning of Section 18 of the Act, it need not be accompanied by a promise to pay expressly or even by implication. Only thing required is that the ackno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prised him of the dues receivable by you in respect of certain long pending matters such as mine benches work and raising at Kaliapani Quarry I. In the matter of Kaliapani it has been decided to constitute a committee which will go separately into your claims and other facts, in which connection you are requested to give all possible help and assistance, so that your dues, if any, will be ascertainable. In regard to other pending matters, you had indicated yourself that you will give the details of claims and payment received by you. This may be given within a day or two so as to enable OMC to settle up the above at the earliest. (emphasis supplied) It explained: 21. It is now well settled that a writing to be an acknowledgment of liability must involve an admission of a subsisting jural relationship between the parties and a conscious affirmation of an intention of continuing such relationship in regard to an existing liability. The admission need not be in regard to any precise amount nor by expressed words. If a defendant writes to the plaintiff requesting him to send his claim for verification and payment, it amounts to an acknowledgment. (emphasis supplie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... writing and signed) by a mortgagee can be construed as an acknowledgment under Section 18 of the Limitation Act, if it fulfills the following requirements: (i) The acknowledgment of liability must relate to a subsisting mortgage. (ii) The acknowledgment need not be in a document addressed to the mortgagor (person entitled to the property or right). But it should be made by the mortgagee (the person under liability). (iii) The words used in the acknowledgment must indicate the existence of jural relationship between the parties and it must appear that the statement is made by the mortgagee with the intention of admitting the jural relationship with the mortgagor. (Such intention of admitting the jural relationship need not be in express terms, but can be inferred or implied from the nature of admission and the words used, though oral evidence as to the meaning and intent of such words is excluded.) (iv) Where the statement by the mortgagee in the subsequent document (say, deed of assignment) merely refers to the mortgage in his favour which is being assigned, without the intention of admitting the jural relationship with the mortgagor, it will not be considered to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndhra Pradesh to pay the dues of the petitioners are 'acknowledgements of liability' under Section 18 of the Limitation Act, 1963, and that they relate to a present subsisting liability and indicate the existence of jural relationship between the parties, i.e., that of a debtor and a creditor and the intention to admit such jural relationship, and extend the period of limitation. RE: claim of petitioner under the first contract dt. 4.7.2007 103. The first contract was made on 04-07-2007 for Cloud Seeding Operations. 104. According to the petitioners, ₹ 22,16,05,956/- was payable to 1st petitioner for 2007, that they received only ₹ 21,46,92,000/- vide G.O.Ms. No. 2 dt. 24-03-2008, leaving a balance of ₹ 69,13,956/-. This payment having been made before the expiry of the period of limitation by the State, a fresh period of limitation would start from the said date as per Section 19 of the Limitation Act, 1963. 105. Thus the period of limitation would stand extended by 3 years upto 23-03-2011. 106. Even according to the 1st respondent, the amount for 2007 Cloud Seeding operations became payable by 1.4.2008, so if the 3 year period is computed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or a fresh promise to pay the amount. 113. At page 69 para No. 256 in File C. No. 327/RS.II/2009 (Page 230 of the papers filed by the petitioners) there is an endorsement: 'in view of the above, the file may be circulated to Hon'ble C.M. through Principal Secretary Fin (R E)/Chief Secretary/Minister (RSAD)/Minister (Finance) for sanction of an amount of ₹ 40,28,47,380 towards pending payment to M/s. Agni Aviation Consultants for conducting Cloud Seeding Operations during the years 2007, 2008 and 2009 and for placing the matter before the Cabinet'. (emphasis supplied) Thereafter, at page 72 at para No. 266 (on page 233 of the papers filed by the petitioners) it is endorsed: 'The report of Sri K. Narasimha Murthy Consultant may be seen in the statement at flag A. There is no dispute regarding the figure of ₹ 40.28 crores given by him. The amount is towards dues pending payment of Messrs Agni Aviation for the years 2007, 2008 and 2009. The advice of the Advocate General at pp. 117121 C.F. may be perused, especially 'X' at page 120 C.F'. (emphasis supplied) There are signatures of the then Minister (RSAD) (on 07.09.2012) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e since the instant Writ Petition was filed on 7-1-2016. RE: claim of petitioner under the second contract dt. 25.07.2008 120. In respect of this claim for payment under the 2nd Cloud Seeding contract for 2008, in the letter No. JNTUH/CAS WMT/162 dt. 11.06.2009 addressed by the 3rd respondent to the Principal Secretary, Rain-Shadow Areas Development Department, Government of A.P., it is stated that a sum of ₹ 22,67,88,907/- is payable to the petitioners. 121. This extends the limitation period upto 10.6.2012. 122. In the documents issued under the Right to Information Act, 2005 there is a File C. No. 327/RS.II/09 on which a noting was made on 10.08.2009 referring to the above letter and stating that the above amount is to be paid to the petitioners according to the 3rd respondent; that the 3rd respondent had requested the Government to release this amount; and the petitioners are also pressing for payment of the same. (Pg. 162-163 of the material papers filed by the petitioners) 123. Thereafter, on the pretext that the petitioners did not shift the aircraft from Bangalore to Tirupathi inspite of being asked to do so through a letter dt. 04.11.2008, it was propo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the limitation upto 28-8-2014. 130. Before this date, as we have stated above, the Hon'ble Chief Minister at that time Sri Kiran Kumar Reddy on 09.01.2013 had granted approval for the payment of ₹ 40.28 crores to the petitioners including the claim of the petitioners for 2008. 131. This also would also extend the period of limitation by three more years, carrying it to 08.01.2016. Before that date, on 07.01.2016, the instant Writ Petition was filed in the High Court as mentioned above. 132. Even otherwise, the contents of the letter dt. 28.03.2012 and letter dt. 11.04.2014 of the Secretary to Government, Rain-Shadow Area Development Department addressed to the 1st petitioner, as explained above as per the principle in J.C. Budhiraja (2006) 4 S.C.C. 484 (Supra), would extend the period of limitation for filing the Writ Petition upto 11.4.2017 (3 years from 11.4.2014 letter) in regard to the claim for the second contract of 2008 for ₹ 22,67,88,907/- which was due and payable to the petitioners; and so even the claim under the second contract for 2008 cannot be said to have been barred by limitation, since the Writ Petition was filed on 07.01.2016 within the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er and one Arvind Sharma were partners. 142. These disputes were referred to a sole arbitrator Justice M.P. Chinnappa, a retired Judge of the High Court of Karnataka. 143. Before the said Arbitrator, both the partners filed a joint memo on 17.10.2013 authorizing the 2nd petitioner to collect payment and to issue a valid receipt to the agencies for the payments received unto and on behalf of the 1st petitioner-Firm subject to honouring the directions given in the order passed on 19.10.2013 by the said Arbitrator. 144. This was also communicated to the respondents, according to the petitioner. 145. In the note file C. No. 327/RS.II/09 at page No. 21 (page 182 onwards filed by the petitioners), there is a reference to this arbitration and even a legal opinion was obtained from the Advocate-General on the said aspect at pg. 194 of the material papers filed by the petitioners. 146. According to the respondents, there would be a risk to the respondents if the payments were all released to the 2nd petitioner on behalf of the 1st petitioner. 147. However, this aspect is covered by Section 47 of the Indian Partnership Act, 1932. The said provision states: Continuing a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in question was surely not any new transaction. It was a decree in favour of the firm and being an asset of the firm it was the duty of the partners to collect it and Navrang Lal being one of the partners of the dissolved firm could surely perform that duty and had the necessary authority to do so under Section 47 of the Indian Partnership Act, 1932. His actions were binding on the firm, that is to say on of the partners of the dissolved firm. ... ... 150. No decision to the contra was cited by the counsel for respondents. 151. In view of the clear provision in Section 47 of the Indian Partnership Act, 1932 and the decisions referred to above, the payments due to the 1st petitioner-Firm can certainly be made to the 2nd petitioner and such payments would bind the 1st petitioner as well. RE : Distribution of the liability between the new State of Telangana and the residuary State of Andhra Pradesh: 152. A curious contention was raised by the Special Government Pleader for the State of Telangana that most of the Districts in which the contract for Cloud Seeding was entrusted were located in the residuary State of Andhra Pradesh after the bifurcation of the composite State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iabilities which have accrued or may accrue under any contract: (a) any liability to satisfy an order or award made by any court or other tribunal in proceedings relating to the contract; and (b) any liability in respect of expenses incurred in or in connection with any such proceedings. ... ... ... 156. Thus, according to Clause (b) of sub-section (1) of Section 60, the liability has to be apportioned between the new State of Telangana and the residuary State of Andhra Pradesh in the ratio 41.68 : 58.32, i.e., the liability of the State of Telangana (respondent No. 1) would be 41.68 % of the total liability and the liability of the State of Andhra Pradesh (respondent No. 2) would be 58.32% of the total liability. Conclusion: 157. In the result, the Writ Petition is allowed with costs of ₹ 25,000/- and respondent Nos. 1 and 2 are directed to pay in three (03) months the arrears of dues under the Cloud Seeding contracts dt. 04.07.2007, 25.07.2008 and 20.07.2009 amounting to ₹ 40,28,47,380 with interest thereon from the respective due dates of payment till the date of actual payment at the rate of 9% per annum; and both the liability towards costs an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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