Patna High Court Reinforces State Responsibility in Adhering to Litigation Policy for Timely Disbursement of Contracts

Introduction

The case of Raghoji House Of Distribution, Through Its Proprietor Namely Mr. Akash Kumar Sonu Petitioner/s v. State Of Bihar Though The Principal Secretary, Agriculture Department And Others /s was adjudicated by the Patna High Court on September 14, 2022. This litigation arose from the petitioner’s claim for unpaid dues amounting to ₹21,67,056/- for services rendered during the Krishi Pradarshani at the Sonepur Mela in the fiscal year 2017-2018.

The petitioner, Mr. Akash Kumar Sonu, sought a writ of mandamus directing the State of Bihar and relevant officials to release the outstanding payment. The case highlights systemic issues within the state’s administrative processes, particularly concerning the adherence to the Bihar State Litigation Policy, 2011, and the mechanisms for grievance redressal.

Summary of the Judgment

The Patna High Court acknowledged a growing trend of litigations filed by private entities and individuals against the State of Bihar for non-payment of dues related to government-commissioned works. Recognizing the strain on the judiciary and the systemic inefficiencies within the state’s grievance redressal mechanisms, the court emphasized the importance of complying with the Bihar State Litigation Policy, 2011.

In this specific case, the court noted that the petitioner had fulfilled contractual obligations by erecting tents and infrastructure for the Sonepur Mela, but only a partial payment had been made. Despite favorable communications from the District Agriculture Officer, the higher authorities failed to release the remaining amount, leading to the initiation of legal proceedings.

The court directed the Chief Secretary of Bihar to ensure the prompt release of the petitioner’s legitimate dues within a specified timeframe and to implement effective grievance redressal mechanisms to prevent such disputes from escalating to litigation in the future.

Analysis

Precedents Cited

The judgment references LPA No. 1322 of 2018 titled The District Manager, Bihar State Food and Civil Supplies Corporation Ltd. Begusarai v. Anuradha Devi, which was disposed of on February 1, 2022. In that case, the court underscored the necessity of reducing litigation through effective implementation of the Litigation Policy and ensuring timely disbursement of dues to prevent avoidable legal disputes.

This precedent reinforces the court’s stance that the State has an inherent responsibility to adhere to its own policies aimed at reducing the judicial burden and ensuring administrative efficiency.

Legal Reasoning

The court’s reasoning is anchored in the interpretation and enforcement of the Bihar State Litigation Policy, 2011. The policy outlines mechanisms for grievance redressal intended to minimize unnecessary litigation by providing structured avenues for addressing disputes internally.

The court observed that despite the existence of such policies, there is a pervasive disregard for adhering to them, leading to an influx of litigation cases that could have been resolved administratively. By emphasizing the need for the State to follow its own grievance redressal mechanisms and to utilize Section 89 of the Civil Procedure Code, 1908, the court highlighted the systemic failures contributing to judicial congestion.

Furthermore, the court stressed the constitutional obligations under Article 39-A of the Constitution of India, which mandates the State to promote equal justice and provide free legal aid, thereby reinforcing the imperative for the State to ensure timely payment of dues to its contractors and service providers.

Impact

This judgment carries significant implications for the administrative processes of the State of Bihar. By mandating the State to adhere strictly to its Litigation Policy and ensuring the timely disbursement of payments, the court is setting a precedent that administrative inefficiency will not be tolerated and must be rectified promptly.

In future cases, this judgment serves as a benchmark for private entities and individuals to hold the State accountable for delays in payments, thereby potentially reducing the number of avoidance litigation cases. Additionally, it underscores the necessity for the State to invest in robust grievance redressal systems, such as the proposed 'Web Portal', to facilitate quicker and more efficient resolution of disputes.

Moreover, the directions laid out by the court aim to enhance transparency and accountability within the State’s administrative machinery, potentially leading to improved trust and cooperation between the government and private entities.

Complex Concepts Simplified

Writ of Mandamus

A writ of mandamus is a court order compelling a government official or entity to perform a duty that is mandated by law. In this case, the petitioner sought a writ of mandamus to compel the State of Bihar to release the outstanding payment.

Bihar State Litigation Policy, 2011

This policy outlines the State’s approach to managing and reducing litigation. It emphasizes the importance of internal grievance redressal mechanisms to handle disputes efficiently without resorting to the judiciary.

Section 89 of the Civil Procedure Code, 1908

Section 89 provides for the transfer of cases from one court to another better suited to address them, aiming to ensure efficient case management and reduce unnecessary litigation.

Conclusion

The Patna High Court’s judgment in the Raghoji House of Distribution case serves as a critical reminder of the State's obligations to streamline its administrative processes and adhere to established litigation policies. By enforcing the timely disbursement of payments and mandating the implementation of effective grievance redressal mechanisms, the court not only addressed the immediate concerns of the petitioner but also set a precedent aimed at reducing the judicial burden caused by avoidable litigations.

This judgment underscores the importance of governmental responsibility in honoring contractual obligations and the necessity of transparent, efficient administrative procedures to foster trust and prevent unnecessary legal disputes. The directives issued by the court pave the way for systemic reforms that could enhance governance and reduce the dependency on the judiciary for resolving administrative grievances.