Lex Non Cogit Ad Impossibilia – Law Does Not Compel Performance of Impossibility: Orissa High Court Quashes Rejection of Contractor's Claim for Price Escalation Due to Quarry Closure

“Rates and Prices Quoted by Bidder Shall Be Fixed” , In a detailed and significant judgment Orissa High Court, sitting at Cuttack, emphatically held that a contractor cannot be denied legitimate price variation for procurement of minor minerals merely on a misreading or misapplication of contract clauses—particularly when the designated lead quarry was closed, and such closure was known to the government authorities but not disclosed to the contractor.

The Court ruled in favour of the petitioner, a government contractor, whose plea for escalation in prices incurred during road construction under the Pradhan Mantri Gram Sadak Yojana (PMGSY) was earlier rejected by the Rural Works Division, Bhadrak, on the ground that the contract price was “fixed.”

The Bench comprising Chief Justice Harish Tandon and Justice Murahari Sri Raman decisively set aside the order dated 09.06.2022 passed by the Superintending Engineer, observing that the said rejection was based on a misreading of Clause 13.4 of the NIT, and contrary to basic principles of contractual interpretation and equity.

"When Quarry Closure Was Known But Not Disclosed, State Cannot Deny Escalation on Technical Clauses" – Court Applies Maxim Actus Curiae Neminem Gravabit

On a meticulous examination of facts, the High Court found that the Kupari Quarry, the only lead quarry indicated in the contract documents for the supply of moorum, metal, chips, and dust, had been under closure since 21.10.2019 following directions of the National Green Tribunal. Yet, the Rural Works Division's estimate and bidding documents not only failed to disclose this material fact but continued to show Kupari as the valid source, thereby misleading the bidder.

Justice Murahari Sri Raman, authoring the judgment, noted that:

“The opposite parties now cannot take benefit of their own wrong to deprive the petitioner of his legitimate dues... Law does not compel the performance of the impossible.”

The Court invoked the settled principle of lex non cogit ad impossibilia, reinforcing that no one can be expected to do the impossible—here, to lift materials from a quarry sealed by judicial order.

"Clause 13.4 Applies to 'Sand', Not Other Minerals": High Court Enforces Plain Text of NIT

One of the pivotal legal determinations in the judgment is the interpretation of Clause 13.4 under “Bid Prices” in the NIT. The State argued that this clause fixed all prices, thereby barring any claim of escalation. However, the Court pointed to the actual wording in the NIT and agreement executed on 01.12.2021, which read:

“The rate sand prices quoted by the Bidder shall be fixed for the duration of the Contract and shall not be subject to adjustment.”

Rejecting the State’s argument that “rate sand” was a typographical error and should be read as “rates and,” the Court held:

“The specific document... reveals ‘rate sand prices,’ not ‘rates and prices’... Since there is no mention about exclusion of other minerals, viz., moorum, metal, chips and dust, the escalation/price variation could not have been denied.”

It relied on the principle of strict construction against the drafter—here, the government—and ruled that ambiguity in standard-form contracts must be interpreted in favour of the contractor.

“Lead Quarry Was Non-Operational Yet Shown in Tender Estimate”: Court Declares Rejection as Misconstruction

While Clause 7 of the NIT encouraged site visits, the Court found that it could not be stretched to require independent verification of government-provided quarry data.

“Clause showing 'Site Visit' at pre-bid stage is only to assess the location and feasibility for commencement and conclusion of the work at the site... It cannot be construed to verify the correctness of quarry operation status which was specifically indicated by the employer.”

The Court highlighted how the tender estimates included transportation cost from Kupari Quarry—thus making it integral to the bid formulation. This, coupled with the absence of any corrigendum or prior disclosure of the quarry’s closure, rendered the government’s stance “arbitrary and irrational.”

Clause 35 on “Variation” Permits Escalation in Circumstances Like Quarry Closure

The Court gave detailed attention to Clause 35 of Section 4: General Conditions of Contract, which authorizes variation in the scope of work and price under changed circumstances. The Committee that rejected the petitioner’s claim had entirely overlooked this clause, focusing narrowly on Clause 13.4.

Quoting the clause, the Court stated:

“The Engineer shall... have power to order, in writing, variations within the scope of the works... Such variation shall form part of the contract.”

The Court concluded that the rejection was not only a misreading of the contract but also an abdication of statutory duty to act fairly under public contracts.

“Petitioner Is Entitled to Price Variation for Procuring Minerals from Distant Quarry” – Court Orders Reconsideration Within 6 Weeks

Finding that the petitioner incurred legitimate extra costs by procuring minerals from Chandeidhara, which was 80 kilometres farther than Kupari, the Court directed the Superintending Engineer to reconsider the representation dated 11.01.2022 “afresh, pragmatically” and communicate the decision within six weeks.

“The Order dated 09.06.2022 by the Superintending Engineer, Rural Works Division, Bhadrak and the decision taken in the Meeting dated 09.06.2022 are set aside.”

The ruling ensures that a contractor, acting in good faith and relying on the information provided by the government, is not penalised for circumstances beyond his control.

This ruling is a substantial contribution to the jurisprudence governing government contracts, especially in public infrastructure projects. By restoring the principle that ambiguity in government-issued documents must not work against the contractor, and by invoking classic legal maxims like lex non cogit ad impossibilia and contra proferentem, the Orissa High Court reinforced equitable adjudication in matters of public procurement.

More broadly, the decision serves as a judicial reminder to authorities that transparency and accuracy in bid documents are not mere formalities—but essential anchors for fairness and public accountability.

Date of Decision: 04 February 2026