The Allahabad High Court has held that a writ petition seeking payment of contractual dues against the State or its instrumentalities is not maintainable unless the amount due is admitted and no factual inquiry is required to ascertain the liability. The bench comprising Justice J.J. Munir and Justice Indrajeet Shukla dismissed the petition filed by Kalyan Health Care Products Pharmaceuticals Co-Operative Society Limited, stating that where facts are disputed and require leading evidence for resolution, the Court must refrain from exercising its writ jurisdiction under Article 226 of the Constitution.
The petitioner, a cooperative society registered under the Cooperative Societies Act, 1965 and licensed to manufacture AYUSH medicines, had supplied medicines pursuant to a supply order issued by the office of the Chief Medical Officer, Allahabad. It claimed to have paid GST amounting to Rs. 2,00,000 and asserted that there was no fault or deficiency in the supply. Despite submission of bills, payment remained outstanding. The petitioner had earlier approached the Court, which directed the Chief Medical Officer to decide the pending representation within eight weeks. By order dated 8 October 2018, the Chief Medical Officer refused to pass the bills, prompting the present writ petition challenging that refusal and seeking a mandamus for payment along with 18% interest.
The Court examined the grounds on which payment was refused and found that they raised substantial and disputed questions of fact. These included compliance with the procurement policy, the quality of the supplied medicines, their utilisation, the return of the medicines, the identity of the firm, and the applicability of limitation. The Court observed that none of these issues could be resolved on the basis of affidavits alone and required oral and documentary evidence to be tested through cross-examination.
In this context, the Court noted that the petitioner relied on a certification by the Chief Pharmacist to substantiate the quantity and quality of the supply. However, no such letter had been placed on record. Even assuming its existence, the Court held that the competence of the Chief Pharmacist to certify quantity and quality would itself be a matter requiring inquiry.
The petitioner also contended that the registration of empanelled manufacturers had expired while its own registration remained valid, thereby creating a right in its favour. The Court rejected this argument, holding that the expiration of another party’s registration did not confer any entitlement upon the petitioner.
The Court relied on its earlier decision in M/s Alaska Tech through its Partner Sanjeet Singh and another v. State of U.P. through Principal Secretary Urban Development and others, where it was held that a claim for dues under a non-statutory contract for supply of goods is essentially a prayer for a money decree. It emphasized that questions concerning the mandated quality of goods or whether the claim is within limitation are not fit for adjudication under Article 226. The Court further referred to the Supreme Court’s judgment in Hindustan Petroleum Corporation Limited and another v. Dolly Das, which held that in the absence of a constitutional or statutory right, Article 226 cannot be invoked to claim money for breach of contract.
Concluding that the petitioner’s entitlement could not be determined without leading evidence, the Court declined to exercise its extraordinary jurisdiction and dismissed the writ petition. It clarified that the dismissal would not preclude the petitioner from pursuing its claim before a Civil Court or any other statutory forum, including arbitration, where the disputed facts could be properly examined.