TaxTMI 
TaxTMI 
2023 (7) TMI 1569
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....ing the territorial jurisdiction of this court could be well answered after discussion and adjudication of the second point. The second point is this: The general law of contract is quite plain. A contract can only be enforced by one party to it against the other. Barring some exceptional circumstances, it cannot be enforced by a third party. This is known as the law of privity of contract. The general law of contract would not have allowed IMECO's claim for their dues arising out of this sub-contract against the appellant. In this writ application IMECO has claimed its dues by asking for a writ of mandamus to be issued commanding the appellant to release the amount due to BEML Ltd. So that by that process it would receive payment. A writ of mandamus is issued by the writ court to compel the government or a body akin to a state under Article 12 of the Constitution of India (collectively the state) to do its duty. The person applying before the court, in other words, the writ petitioner, should have sufficient locus standi. This means that he should enjoy the right of entitlement to performance of that duty by the state. If in a contract a claim is undisputed, unquestionably a pa....
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....cting party, to compel him to discharge his duty to make payment to the other contracting party so that as a result, the sub contractor has the prospect of receiving payment as well. Now, I come to the question whether this court has lack of territorial jurisdiction to entertain, try and determine the writ application. Southern Railway, the respondent No. 2 in the writ application, the appellant before us (the appellant) in or about the years 2007-2008 arrived at a policy decision to increase the passenger carrying capacity of AC three tier and sleeper class railway coaches by insertion of an additional berth (middle berth) between the lower and upper berths "on the longitudinal side of existing coaches". BEML Ltd., the respondent No. 1 in the writ application and the respondent No. 2 in this appeal (BEML) is a Government of India company in which the government holds 54% of its share capital. The appellant entered into a contract with BEML for supply and fitting of these berths. BEML in turn entered into a sub-contract with IMECO, the writ petitioner and the respondent No. 1 in this appeal (IMECO), to carry out this contract. Admittedly, as far as the contract between the appe....
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....th these berths by 18th February, 2009. Materials for 18 coaches were also supplied but not utilized, leaving a balance of 425 coaches in which neither the berths were fitted nor materials supplied to the appellant. As far as ACCN coaches were concerned upto 18th February, 2009, 6 had been fitted with berths and materials supplied for 34 coaches. In relation to 86 coaches neither the berths were fitted nor materials supplied. For whatever reason the Railways thought that there was no point going ahead with the agreement. The Railway Board by its letter dated 18th February, 2009 terminated the contract. This termination seems to have been accepted by BEML. The Railway Board by its decision on 30th March, 2009 stated that payment could be made to BEML for berths already manufactured and made ready but not fitted till the issue of the notification. BEML was asked to submit the "Rites" inspection certificate relating to the finished products manufactured prior to the cancellation of the agreement. This date was reckoned to be 24th February, 2009. It was also stated in the communication that the material cost for one such berth in SCN coaches was Rs.1,10,070/-, the cost for 425 berths....
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.... The appellant should immediately act in terms of the circular of the Railway Board dated 30th March, 2009 and to make payment to BEML considering the note of the Senior Divisional Mechanical Engineer at Pgs.103-104 of the paper book and upon verification of the records regarding the quality and quantity of supply by IMECO to take care of the averments in paragraph 13 of the affidavit-in-opposition quoted above. The appellant should make payment of the bills of BEML within two months of communication of this letter. BEML in turn will make payment to IMECO within a further period of one month. I see no reason to interfere with the impugned judgment and order. It is affirmed. This appeal is dismissed affirming the judgment and order of the learned trial judge with the additional orders made above. (I. P. MUKERJI, J.) Biswaroop Chowdhury, J. I have perused the judgment delivered by my learned brother and agree to the grounds mentioned therein. However I add the following grounds. The Writ Petition in which the impugned order was passed was instituted by the respondent no - 1 M/S. IMECO Ltd against the appellant seeking a direction upon the appellant to release the dues of BEML l....