PETITIONER: ABDUL RAHIMAN KHAN Vs. RESPONDENT: SADASIVA TRIPATHI DATE OF JUDGMENT: 15/07/1968 BENCH: SHAH, J.C. BENCH: SHAH, J.C. BHARGAVA, VISHISHTHA CITATION: 1969 AIR 302 1969 SCR (1) 351 ACT: Representation of the People Act (43 of 1951), s. 9A- Contract with Government-Not entered with Governor--If disqualifies. Constitution of India, Art, 229-Contract not entered with Governor--Whether disqualifies under s. 9A Representation of the People Act. HEADNOTE: The appellant's tenders to carry out certain contracts with the State of Orissa were accepted but final contracts were not executed on behalf of the Governor. The -appellant carried on a part of the work and thereafter requested the authorities to cancel the contract without any penalty. No acceptance of this offer was communicated to the appellant. The appellant wrote letters to the Superintending Engineer for extension of time and for permission to resume the, work and finish it. Shortly thereafter the appellant filed his nomination paper for a seat to the State Legislative Assembly, which was rejected. The appellant filed an election petition for setting, aside the election of the respondent on the ground that the appellants nomination paper was improperly rejected. The High Court rejected the petition. HELD : The appellant was rightly disqualified. (i) The contract was not wholly performed by the appellant. Unless he proved that he had completed the contract or showed that there was determination by mutual assent of the contract, the appellant could not claim that there was no subsisting contract at the date of the filing of the nomination paper. The conduct of the appellant in writing the two letters suggested that he did not treat the contract as cancelled, nor there was any clear evidence to show that the authorities bad treated the contract as cancelled. [356 C-E] (ii) The contract resulting from the acceptance of his tender though not enforceable by suit against the State Government, because it did not comply with Art. 299 of the Constitution must still be regarded as disqualifying the appellant under the Representation of People Act from standing as a candidate for election to the State Legislature. [357 H] Chatturbhuji Vithaldas Jasani V. Moreshwar Parashram & Ors., [1954] S.C.R. 817 and Lalitesliwar Prasad Sahi v. Bateshwar Prasad & Ors., [1966] 2 S.C.R. 63, followed. JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1723 of
1967.
Appeal under section 116-A of the Representation of the
People Act, 1951 of the judgment and order dated October 14,
1967 of the Orissa High Court in Election Petition No. 1
of1967.
D. Goburdhun, for the appellant.
352
C. B. Agarwala, Uma Mehta, S. K. Bagga and S. Bagga, for
the respondent.
The Judgment of the Court was delivered by
Shah, J. At the last general elections, the respondent was
declared elected to the Legislative Assembly of Orissa from
the Nowrangpur General Constituency. The appellant filed an
election petition before the High Court of Orissa for an
order setting aside the election of the respondent, on the,
ground that the appellant’s nomination paper was improperly
rejected and he was illegally deprived of his right to
contest the election. The High Court rejected the petition.
The appellant has appealed to this Court under s. 116-A of
the Representation of the People Act, 1951.
It is common ground that the appellant was carrying on the,
business of a building contractor and that in pursuance of a
notification issued by the Government of Orissa he had
submitted tenders for construction of buildings of the
Rental Housing Scheme at the rates specified therein. Those
tenders were accepted and the appellant had carried out a
part of the construction work, but had thereafter stopped
the work because he suffered serious injuries which
necessitated his detention in a public hospital. The
appellant claimed that at his request the contract was
cancelled, and on that account at the date of the filing of
his nomination there was, between him and the State of
Orissa no subsisting contract for execution of works
undertaken by him, and that in any event there was in law no
contract between him and the State relating to the execution
of works which disqualified him from standing at the
election as a candidate for a seat in the State Legislative
Assembly.
In January 1965 tenders were invited by the Government of
Orissa for construction of buildings under the Rental
Housing Scheme. The tenders submitted by the appellant were
accepted and on March 30, 1965, the appellant and the
Executive Engineer signed an agreement in Form K-2. The
principal recitals in the agreements were :
“I do hereby tender to execute the
undermentioned description of work by piece
work, and in accordance with the conditions
noted before in consideration of payment being
made for the quantity of work executed at rate
specified in the following schedule.”
A schedule of items was appended thereto which
was followed by the recital :
“Conditions as per F-2 contract which will be
finalised.”
353
The Executive Engineer then made an endorsement on the
tenders. “Accepted by me for item 5 only,” and submitted
them to the Superintending Engineer for approval of “excess
items”. Apparently sanction was given by the Superintending
Engineer but no formal contracts in Form F-2 were executed.
Advance payments were however made to the appellant after
execution of the agreements in Form K-2 and the appellant
proceeded with the work of construction. On October 13,
1965 the appellant suffered serious injuries which
necessitated his admission to a public Hospital and the
construction work was stopped. On January 6, 1966, the Sub-
Divisional Officer, P.W.D. Nowrangpur, addressed a letter to
the appellant calling upon him to resume work on or about
the January 12, 1960, failing which, he was informed, his
contract will be terminated and “measurements will be
recorded”. On February 10, 1966, the appellant addressed a
letter to the Executive Engineer, P.W.D. stating that it was
not possible for him to resume the work and to complete it,
and he requested that the contract be cancelled without
imposition of penalty. On the letter of the appellant there
are two endorsements at the foot of the letter which have
been marked Ext. 2 (a) and Ext. 2 (b) : Exhibit 2 (a) reads:
“Submitted to the Executive Engineer, Koraput
Division. The reason for terminating the
contract, as mentioned by Shri A. R. Khan,
contractor, is correct. His contract may be
terminated without imposing, penalty and
permission given to fake up work through job
work soon.”
Exhibit 2(b) dated March 18, 1966, bears the
initials of the Executive Engineer, and states
:
“I know of the unfortunate accident. As the
applicant is still in the Vizag Hospital his
work may be finally measured and closed
without penalty. The balance of the work may
be completed through job work.
The Sub-Divisional Officer, Nowran Nagpur, wrote a letter on
March 16, 1955, requesting one Harihar Bisoi pursuant to his
application dated March 5, 1966, to take up the Rental
Housing Schedule building work at Nowrangpur “immediately
,it current schedule of rates after taking detailed
instructions from the Sectional Officer, Nowrangpur.” It
appears that Harihar Bisoi did some construction work, but
no payment was made to him and he also stopped the work.
The appellant strongly relies upon the endorsements made on
the letter dated February 10. 1966, the letter Ext. 3, and
the evidence of Ram Mohan Patnaik-the Executive Engineer.
Ram Mohan Patnaik stated that he by his endorsement Ext.
2(b) on
354
the application dated February 10, 1966, had clearly
directed that the work of the contractor (appellant) would
be finally measured and his contract would be treated as
closed and no penalty would be charged from him; that the
question of accounting had nothing to do with the closing of
the contract; and that on March 18, 1966, he had passed an
order Ext. 2(b) that the contract was closed. According to
the witness closure of the contract was not contingent upon
the measurement of the work done by the appellant, and that
by his order dated March 18, 1966 Ext. 2(b) the appellant
was excused from liability to complete the work, as the
contract was rescinded and by implication Ext. 2(b) meant
that the Sub-Divisional Officer would give intimation to the
contractor about the cancellation of his contract. The
witness could not say whether the Sub-Divisional Officer did
give intimation to the contractor. He asserted that it was
not his intention that job work should be entrusted to job
workers only after the final bill of the appellant was
submitted : his clear intention was that after measurement
was taken, the work may be entrusted to job workers.
According to the witness by Ext. 2(b) he accepted the
incomplete work of the appellant “as a complete satisfaction
of his contract.”
This evidence prima facie supports the case of the appellant
that it was the intention of the Executive Engineer to
terminate the contract. But there is a mass of evidence on
the record which shows that no steps were taken to intimate
to the appellant about the determination of the contracts
and both the parties treated the contract as subsisting. To
that evidence we may advert. On April 15, 1966, the
appellant wrote a letter in reply to a letter dated April
13, 1966 from the Sub-Divisional Officer that he “had
completed upto slab level the construction of Rental Housing
Scheme” and that thereafter he was lying injured in a
hospital and that as he had no authorised agents to look
after further work, early action may be taken to make final
measurement upto slab level and for payment of the amount
due to him. On December 20, 1966, the appellant wrote a
letter to the Superintending Engineer stating that he had
recovered and was in a position to leave the Hospital and to
attend to his normal avocation and that he had learnt that
the Department wanted to cancel his contract and call for
new tenders and had taken some action towards that end. He
requested the Superintending Engineer to desist from such a
course and to favorably consider his request for extension
of time to complete the work. He stated that he had
advanced large sums of money to the laborers and for the
supply of materials, and there were large quantities of
building materials belonging to him which had been lying at
the site of the work and if his contracts “were to be
cancelled he would sustain irreparable loss”; that he had
always been a very efficient
355
and good contractor and was executing the works in time and
diligently and well; and that he could not complete the work
due to the unfortunate accident. He then stated :
“I, therefore, request you to kindly grant me
time upto end of March 1967 and I shall resume
the work by about 15th January 1967 and will
finish it by 31st March, 1967.
The cancellation of my contract at this stage
when nearly 75 % of the work was already done
by me and the roofing alone remains to be
completed and the stoppage of the work was due
to circumstances over which I had no control
due to more or less vis major will be most
inequitable if not unjust. 1, therefore,
earnestly appeal to you to sympathetically
consider this representation of mine and grant
me time till end of March 1967 and order
withdrawal or cancellation of the fresh
tenders that might have been called fo
r by the
Executive Engineer Koraput.”
At the foot of the letter there is a notation that tenders
had been called for the balance of the work “as per
instructions of the Executive Engineer, Koraput, and that
the contract may be rescinded as instructed by the Executive
Engineer, Koraput. There is another notation : “It is an
old case wherein Executive Engineer has already ordered to
close the contract and do by job (illegible) order its
without penalty (illegible)”. There is one more notation
dated January 4, 1967–‘Submitted for favour of orders.
What penalty is to be imposed in rescinding the contract.”
Exhibit 13 is a letter dated January 22, 1967, from the
Assistant Engineer, P.W.D. Nowrangpur to the Returning
Officer which sets out the circumstances in which the work
entrusted top the appellant was stopped. The letter states
that “the balance work which was suggested to take up on
job-work basis would not affect the accounts of Sri A. R.
Khan for his work portion. The final bills for his above
two works of the aforesaid contractor have been submitted to
Division Office vide this office letter Nos. 120 and 121
dated 18-1-67 and I have been intimated vide Divisional
letter No. 902 dated 20-1-67 that the said contractor has to
return 435 bags of cement and 7.954 quintals of rods to the
undersigned to finalise his accounts. But no material has
been returned by the contractor yet and as such it ensures
that his accounts have not yet been finalised.” Exhibit 14
is a letter dated January 22, 1967 addressed to the
appellant which also indicates that the P.W.D. authorities
had not treated the contract as cancelled and had not
intimated to him the order made by the Executive Engineer.
356
In February 1966 the appellant requested cancellation of the
contract. The Executive Engineer was willing to accept the
offer of cancellation and made an endorsement in that
behalf, but nothing was done thereafter. Harihar Bisoi was
apparently asked to take up the work- “at the current
schedule of rates”, but even thereafter the contract with
the appellant was not treated as canceled.
It is true that by virtue of the Explanation to s. 9A of the
Representation of the People Act, where a contract has been
fully performed by the person by whom it has been entered
into with the appropriate Government, the contract Shall be
deemed not to subsist by reason only of the fact, that the
Government has not performed its part of the contract either
wholly or in part. In the present case the contract was not
wholly performed by the appellant, and unless he had
completed the contract or showed that there was
determination by mutual assent of the contract, the
appellant cannot claim that there was no subsisting contract
at the date of the filing of the nomination paper. By
letter written by the appellant on July 22, 1966, Ext. C,
the appellant made a request for extension of time by six
months to enable him to complete the work and by his letter
Ext. D dated December 20, 1966 he requested the
Superintending Engineer not to cancel the contract or call
for new tenders. This conduct of the appellant clearly
suggests that he did not treat the contract as cancelled,
nor is there any clear evidence to show “that the
authorities had treated the contract as cancelled. The High
Court was, therefore, right in holding that the case did not
fall within the explanation to s. 9A of the Representation
of the People Act and there was no evidence of determination
of the contract by mutual agreement.
Counsel for the appellant contended that the contract for
execution of works was between the State and the appellant
and Art. 299 of the Constitution applied thereto, and since
the contract was not shown to be executed in the name of the
Governor, and by an authority competent to execute the
contract on behalf of the Governor, the disqualification
under s. 9A did not apply. By cl. (1) of Art. 299 all
contracts made in the exercise of the execute power of the
State must be expressed to be made by the Governor of the
State, and all such contracts made in the exercise of that
power must be executed on behalf of the Governor by such
persons and in such manner as he may direct or authorise.
It is true that agreements were executed by the Executive
Engineer in Form K-2 but no final contracts were executed in
Form F-2. The appellant proceeded on the footing that there
was a binding contract under which he had undertaken the
work of construction for the State, and the State had
allowed him to work and had offered to pay him for the work
done at the
357
rates set out in Form K-2. The appellant could not by
virtue of Art. 299 sue in a civil court on the agreement in
Form K-2 for compensation for breach of contract. But we
are unable to hold that the appellant was not disqualified
under s. 9A of the Representation of the People Act merely
because the contracts were not enforceable against the State
because of Art. 299 (1) of the Constitution. In Chatturbhuj
Vithaldas Jasani V. Moreshwar Parashram and others(1), Bose
J., in dealing with a case of disqualification under the
Representation of the People Act 1951, resulting from a
contract with the State which is not executed in the form
and manner prescribed by Art. 299, observed:
“It may be that Government will not be bound
by the contract in that case, but that is a
very different thing from saying that the
contracts as such are void and of no effect.
It only means that the principal cannot be
sued; but we take it there would be nothing to
prevent ratification, especially if that was
for the benefit of Government. We accordingly
hold that the contracts in question here are
not void simply because the Union Government
could not have been sued on them by reason of
Article 299(1).”
Undoubtedly for breach of the terms of a contract not
executed in the manner prescribed by Art. 299 (1) a suit for
relief in a civil court will not lie, but on that account it
cannot be said That a contract for execution of works
undertaken by a person though not executed in manner
prescribed by Art. 299, but which is treated by both the
parties thereto as binding will not operate as a
disqualification. In a recent judgment of this Court in
Laliteshwar Prasad Sahi v. Batteshwar Prasad and others(1),
this Court held that where an agreement for execution of
work had been entered into between the State Government and
a private person by correspondence and the State Government
has ratified the agreement and has treated the relation
between the parties as contractual and has accepted
liability arising under the terms of the agreement as if it
were a pending contract, a disqualification under the
relevant provisions of the Representation of the People Act
results.
As already pointed out, the appellant had commenced exe-
cution of the work but had not completed it. Payment for
the work done was not made to the appellant. The contract
was not determined by mutual agreement nor was it abandoned.
The contract resulting from the acceptance of his tender
though not enforceable by suit against the State Government,
be-
(1) [1954] S.C.R. 817.
(2) [1966] 2 S.C.R.63
358
cause it did not comply with Art. 299, must still be
regarded as disqualifying the appellant under the
Representation of the People Act from standing as a
candidate for election to the State Legislature.
The appeal therefore fails and is dismissed with costs.
Y.P. Appeal dismissed.
359
