Sri Kalimi Agrotech vs The State Of Telangana on 21 January, 2025

Telangana High Court

Sri Kalimi Agrotech vs The State Of Telangana on 21 January, 2025

      THE HONOURABLE SMT. JUSTICE T. MADHAVI DEVI

                WRIT PETITION NO.17099 OF 2023

                               ORDER

In this writ petition, the petitioner is seeking a Writ of Mandamus

to declare the inaction of the 3rd respondent in paying the amounts due

to the petitioner towards the supply of seeds of Bengal gram, Soya beans

and Groundnuts under agreements during the Rabi 2018-2019 and 2019-

2020 as illegal and arbitrary and to consequently direct the 3rd

respondent to pay the sum of Rs.1,93,93,055/- together with interest

under Section 16 of the Micro, Small and Medium Enterprises

Development Act, 2006 (for short, ‘the MSMED Act‘) and to pass such

other order or orders.

2. Learned counsel for the petitioner submitted that the petitioner is

a Multi State Co-operative Institution established in the year 1949 and is

catering to the needs of the State for supply of seeds, fertilizers and

other agricultural inputs and marketing infrastructure to the Departments

of Horticulture, Agriculture and Marketing and that the State

Government has nominated the 3rd respondent as its Nodal Agency for

supply of various items to the Departments of the State Government to
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procure various materials/articles/services from the 3rd respondent.

Therefore, the 3rd respondent is a State within the meaning of Article 12

of the Constitution of India and is amenable to writ jurisdiction.

3. It is submitted that the petitioner has entered into agreements with

the 3rd respondent during the Rabi 2018-2019 and 2019-2020 for supply

of seeds of Soya beans, Bengal gram and Groundnut and is registered as

a MSME under the MSMED Act in the year 2012 and has supplied

different quantities of seeds to the 3rd respondent and the total value of

the same is Rs.4,11,16,627/- and the petitioner was paid a sum of

Rs.1,52,67,313/- up to 10.03.2021 and the outstanding balance is

Rs.1,98,49,314/-. It is submitted that the petitioner has thereafter

received a sum of Rs.2,78,055/- and Rs.1,78,200/- on 27.06.2023 and

the balance amount of Rs.1,93,93,059/- is still payable and since the 3rd

respondent is not responding, the present Writ Petition has been filed.

4. Learned counsel appearing for the 3rd respondent, however,

objected to the maintainability of the Writ Petition. It is submitted that

the Writ Petition is filed by the sole Proprietor and not by the institution

and therefore, the Writ Petition is not maintainable under MSMED Act.

It is submitted that the petitioner has not exhausted the remedies

available to it under law and that under Section 18 of the MSMED Act,
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the petitioner ought to have approached the competent authority, i.e., the

Micro and Small Enterprises Facilitation Council to initiate conciliation

proceedings and to address its grievance as the matter pertains to

recovery of the amount due. It is further submitted that the Writ Petition

appears to be for settlement of contractual obligation and not any

statutory obligation on the part of the respondents and therefore, the

Writ Petition is not maintainable.

5. The learned counsel for the petitioner, however, relied upon the

judgment of the Hon’ble Supreme Court in the case of Zonal Manager,

Central Bank of India Vs. Devi Ispat Limited and others1 in support

of his contentions about the maintainability of the Writ Petition. He also

referred to Micro, Small and Medium Enterprises Development Act,

2006 and Section 16 thereof for rate of interest along with the date from

which such interest is payable.

6. The learned counsel for the 3rd respondent, however, relied upon

the following judgments in support of his contentions and also on

Sections 17 and 18 of the MSMED Act for availability of effective

remedy.

1
(2010) 11 SCC 186
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Group Housing Society Ltd., and others 2.

(2) Miraj Marketing Corporation Vs. Vishaka Engineering and

another3.

7. Having regard to the rival contentions and the material on record,

this Court finds that the petitioner is a proprietary concern and has filed

the Writ Petition in the name of the company which has entered into

agreements with the 3rd respondent and is represented by its Sole

Proprietor. Therefore, the objection of the 3rd respondent about the

maintainability of the Writ Petition because it has been filed by the Sole

Proprietor is not sustainable.

8. As regards the other objections about the alternative and effective

remedy being available under the MSMED Act and that it is the

contractual obligation which is allegedly as not being honoured and

therefore writ is not maintainable, this Court finds that the 3rd

respondent is a State within the meaning of Article 12 of the

Constitution of India and any agreement with the 3rd respondent for

discharge of its contractual or statutory obligation can be sought to be

2
2005 SCC OnLine Del 1392 : (2006) 127 DLT 80
3
2005 (79) DRJ 209 (DB)
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enforced by filing a Writ Petition under Article 226 of the Constitution

of India. The decision relied upon by the learned counsel for the

petitioner supports the case of the petitioner, while the decisions relied

upon by the learned counsel for the 3rd respondent are distinguishable on

facts. Therefore, this Court is of the opinion that the Writ Petition is

maintainable.

9. The respondents are therefore directed to consider the request of

the petitioner for payment of the balance consideration and pass

appropriate orders on the representation of the petitioner after due

verification of records. The respondents are directed to pass necessary

orders within a period of three (3) months from the date of receipt of a

copy of this order.

10. The Writ Petition is accordingly disposed of. No order as to costs.

11. Pending miscellaneous petitions, if any, in this Writ Petition shall

stand closed.

___________________________
JUSTICE T. MADHAVI DEVI

Date: 21.01.2025

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