Petitioner's Demand Not Sustainable: High Court Allows Writ Petition Against Communication Halting Paddy Storage

07 May 2024 8:19 AM

By: Admin

In a significant decision, the High Court of Punjab and Haryana ruled in favor of M/S M.K. Industries, allowing a writ petition that sought to set aside a communication dated 26th October 2023. The communication had halted the storage of paddy in the petitioner's premises until the payment of Rs.7,28,167/- along with interest to the Punjab State Warehousing Corporation.

Justice Jagmohan Bansal, in his observation, stated that the "demand raised by respondent from petitioner with respect to afore-stated litigation is not sustainable." The Court found that the respondent's claim that an arbitration case was pending between M/s Rashi Foods and respondent No.6, thereby making M/s Rashi Foods a defaulter, was not justifiable.

The case revolved around the Custom Milling Policy for KMS 2023-24, under which the petitioner had applied for the allocation of paddy. The respondent had alleged that the petitioner filed a false affidavit regarding the status of the earlier owner of the land where the rice mill is located.

The Court noted that the Arbitrator had rejected the claim of the respondent against M/s Rashi Foods and that there was no stay by the Objecting Court. "In the absence of pendency of proceedings before Arbitrator or stay by Objecting Court, it would not be just, fair and reasonable to conclude that an arbitration case is pending," Justice Bansal observed.

High Court held that the writ petition deserved to be allowed and was accordingly allowed. The Court also clarified that the observations made shall not be construed as an opinion regarding the pending litigation between respondent No.6 and M/s Rashi Foods.

Date of Decision: 31 October 2023

M/S M.K. INDUSTRIES VS STATE OF PUNJAB AND OTHERS