Legal Articles

No Party Should Suffer Due To The Act Of Court : SC

The Supreme Court has once again on November 28, 2019 very rightly reiterated in a latest judgment titled Odisha Development Corporation Ltd v. M/s Anupam Traders & Anr. in Civil Appeal No. 9083 of 2019 (Arising out of SLP (Civil) No. 17627 of 2019) along with others the time tested maxim “actus curiae neminem gravabit” which in simple and straight language means that, “No party should suffer due to the act of Court.” This begs the question: Why should any party ever suffer due to the act of court? This is what has been laid down so precisely and explicitly by the top court in this latest case which must be always followed also by all the Courts!

This latest, landmark and extremely laudable judgment authored by Justice A.S. Bopanna for himself, Justice R Banumathi and Justice Hrishikesh Roy after granting leave in para 1 sets the ball rolling in para 2 wherein it is observed that, “The appellants in eleven of these appeals are the Odisha Forest Development Corporation Ltd. (“OFDC Ltd.” For short) and the State of Odisha is the appellant in two other appeals. The appeals filed by the State of Odisha relate to the same orders in respect of the same private respondents who were the writ petitioners regarding whom the Odisha Forest Development Corporation Ltd. has also filed the appeal. Further, though separate orders passed by the High Court in different writ petitions relating to various petitioners are assailed in all these appeals, the issue involved is the same. Hence all these appeals were clubbed, heard together and are accordingly disposed of by this common judgment. For the purpose of narration of facts, the case as in Civil Appeal arising out of SLP(C) No.
17627/2019, titled Odisha Forest Development Corporation Ltd. vs. M/s Anupam Traders & Anr. Is taken note, which reads as hereunder.”

While elaborating in detail, para 3 then says that, “The appellant OFDC Ltd. issued an e-tender notification dated 22.11.2016 inviting offers online from intending purchasers for advance sale of phal Kendu leaf (KL) of 2017 crop as per the ‘lots’ indicated in the notification.  The private respondent had responded to the notification and made its offer. The bid was opened on 07.12.2016. The private respondent being the successful bidder was required to execute an agreement and deposit the provisional security deposit of Rs. 5,00,000/- (Rupees Five Lakh). The private respondent herein executed an agreement dated 20.01.2017. In terms of the agreement, on the actual quantity of leaves collected, the additional security deposit covering 25% of the purchase price of the lot was to be deposited before 31.05.2017. The private respondent in the instant case was therefore required to deposit the differential security amount of Rs. 27,14,765/- less, the security amount of Rs. 5,00,000/- (Rupees Five Lakh) already paid.”
While continuing in the same vein, it is then stated in para 4 that, “In view of the requirement to pay the same before 31.05.2017, the private respondent addressed a letter dated 02.06.2017 seeking extension of time to pay the said security amount. The extension sought was declined by the appellant through the communication dated 06.06.2017. Since the amount required to be deposited was not made, the appellant cancelled the agreement dated 20.01.2017 by issuing the notice dated 21.08.2017. Since such cancellation would be at the ‘cost and risk’ of the private respondent, the lot was to be put to re-tender. The appellant accordingly proceeded to issue a fresh e-tender notification on 22.08.2017 for sale of the same ‘lots’ of the phal Kendu leaves.”

Moving on, para 5 then states that, “At that stage the private respondent aggrieved by extension of time not being granted, filed the writ petition in W.P. (C) No. 11498/2017, the same was withdrawn and a writ petition bearing W.P. (C) No. 18718/2017 was filed wherein the order dated 21.08.2017 passed by the appellant cancelling the agreement dated 20.01.2017 as also the subsequent Auction Notice dated 22.08.2017 were assailed. In the said writ petition, interim order against the subsequent auction through notice dated 22.08.2017 was sought. While considering the same, the High Court while allowing the appellant to proceed with the subsequent tender process, had stayed the finalization of the sale subject to the private respondent herein depositing an amount of Rs. 20,00,000/- (Rupees Twenty Lakhs only) within one week with the appellant herein. The said order was passed on 08.09.2017 wherein it was further directed that the said amount would be kept in a separate deposit by the appellant. The application filed by the appellant herein seeking vacation of the interim order was considered and at that stage since the vacation of the stay was not opposed by the private respondent herein, it was vacated on 28.03.2018 due to which the subsequent sale was completed on 24.04.2018. The private respondent herein thereafter sought leave to withdraw the writ petition in W.P.(C) No. 18718/2017 thereby giving up the challenge to the cancellation of the auction process wherein the private respondent had taken part and also the challenge to the subsequent auction which had been conducted by the appellant. The High Court while disposing of the writ petition as withdrawn, despite objection put forth by the appellant herein directed refund of the deposit which was made pursuant to its interim order dated 08.09.2017. The appellant herein is, therefore, aggrieved by the order dated 30.04.2019 only to the extent whereby the High Court has directed refund of the amount available with the appellant.”

Most importantly, it is then observed in para 20 that, “As noticed above, the appellant in any event would have the right to determine the loss suffered and recover the same in accordance with law as the process to re-tender, was at the ‘…….cost and risk’ of the private respondent as stated in the notice of termination. In that circumstance, when it is prima-facie indicated that due to the delay caused at the instance of the private respondents the value of the Kendu leaves had reduced, thereby causing loss, in view of legal proceedings initiated by the private respondents, the Court will have to bear in mind the maxim actus curiae neminem gravabit, namely, no party should suffer due to the act of Court. In such event, since the interim order was at the instance of the respondent the appellant should in our opinion be permitted to retain the amount and complete the process by providing opportunity to the private respondents.”

On a concluding note, it may well be said that this commendable judgment once again reiterates the time tested maxim “actus curiae neminem gravabit”, which postulates that, “No party should suffer due to the act of Court.” Very rightly so! It also makes it absolutely clear that if the Court in a given case imposes the condition, the same is to be treated as being with a purpose and not as an empty formality! There can be no denying or disputing it! Certainly, no questions can be raised on this!

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