Nizamudeen A. vs State Of Kerala & Ors.

Soumen Sen, C. J.

Heard Mr. Anil Thomas, learned counsel for the appellant, Mr. Millu Dandapani, learned counsel for the 2^nd respondent and Mr. Bijoy Chandran, learned Senior Government Pleader.

The appellant/writ petitioner is aggrieved by the judgment dated 13.08.2025 in W.P. (C) No. 38799 of 2024 filed by him praying inter alia for a direction upon the 2^nd respondent to calculate the amount due to the appellant in terms of the judgment passed in W.P. (C) No. 13125 of 2022 dated 05.08.2022 and also for stay of all further proceedings pursuant to Exts. P10 and P11 notices issued by the 2^nd respondent till final modification of the amount as per Ext. P6 calculation made by the appellant which is due to him. Exts. P10 and P11 refers to letters issued to the appellant stating that it is not possible to extent the time limit for completion of the sale and a direction upon the appellant to remit 55 percent of the total sale amount being the 1^st and 2^nd instalment on or before 25.10.2024.

During the pendency of the appeal, more than once, opportunities were given to the appellant to deposit a sum of Rs. 7.5 crores as the Coordinate Bench was of the view that as on 04.12.2025, the appellant would be liable to pay a sum of Rs. 7,07,76,469/- which was rounded off to 7.5 crores. This order was passed on 01.12.2025 followed by a subsequent order dated 03.02.2026 when this Bench had extended the time to deposit the aforesaid sum within 10 days from the date of the order. Till date, the said amount has not been deposited.

The learned counsel appearing on behalf of the appellant has submitted that while disposing of the W. P. (C) No. 38799 of 2024, the learned Single Judge has overlooked the direction passed on 05.08.2022 where the present appellant had prayed for refund of the earnest money deposit of Rs. 3.50 Crores with interest in accordance with directions contained in Ext. P7 which is an order passed by the Government calculating the interest to which the appellant would be entitled.

However, we respectfully differ with the said submission having regard to the fact that while deciding the writ petition, in paragraph No. 22, the learned Single Judge has referred to the note submitted by the Senior Government Pleader wherefrom it would appear that on the basis of the report of the CA firm, which was entrusted to calculate the interest payable on the said sum, the amount due to the appellant would be Rs. 5,38,27,404/- which includes both principal and interest and calculated after taking into consideration the rate of interest at the rate fixed by the Reserve Bank of India from time to time.

The learned counsel for the appellant however has argued that the said calculation is erroneous and this ought to have been done by the learned Single Judge before disposing of the writ petition.

The 2^nd respondent company is on the verge of closure. When it was operational, the appellant entered into an agreement with the 2^nd respondent namely, Travancore Cements Ltd. for desiltation programme of Lower Periyar Reserve. Though the said agreement was executed, the appellant claimed that he had faced several obstacles and ultimately, the said contract was called off and the Government directed the 2^nd respondent to release the earnest money and security deposit of Rs. 3.57 Crores with interest at the prevailing Bank rate from the date of agreement.

In the earlier writ petition, the appellant had claimed the said amount and the learned Single Judge allowed the writ petition by directing the respondents to disburse a sum of Rs. 3,57,50,000/- deposited by the appellant in accordance with the directions contained in a Government Order Ext. P7 within three months. Due to the non-compliance of the said order, a contempt petition was filed. During the pendency of the contempt matter, the 2^nd respondent decided to sell the property in order to meet various liabilities including the service and retiral benefits of its employees. During that time, the appellant along with one Mr. M. K. Nassarudeen Musaliar found a joint venture and submitted the tender. The 2^nd respondent forwarded the proposal to the Government for confirmation and the Government granted consent. The writ appellant requested the 2^nd respondent to finalise the amount due to him along with interest as directed in the earlier writ petition to which the 2^nd respondent responded that the Government was requested to complete and finalise the amount.

In the meanwhile, the 2^nd respondent issued a letter to the appellant directing him to remit an amount of Rs. 2 crores as the 1^st instalment amount within a period of one month as per Ext. P8 letter dated 19.09.2024. The appellant submitted a letter requesting to extend the time to remit since the amount due to the petitioner was not quantified. The 2^nd respondent again issued another letter dated 21.10.2024 directing the petitioner to remit 55 percent of the total sale amount being the 1^st and 2^nd instalment on or before 25.10.2024 and threatened to cancel the tender. In such circumstances, the second writ petition was filed namely W. P. (C) No. 38799 of 2024.

The 2^nd respondent before the learned Single Judge has contended that the issue with regard to the refund in the earlier writ petition is quite distinct and separate from the issue raised in the present writ petition as the subject matter of the present writ petition is with regard to performance of the obligation under the tender issued for reauction of the landed properties of the 2^nd respondent.

Although such contention was raised and the petitioner could not have claimed set off which necessarily has to be contractual or statutory and the claim for adjustment is primarily based on equitable consideration having regard to an earlier adjudication by which the 2^nd respondent was directed to refund the amount deposited in respect of the project that was abandoned, the learned Single Judge applied the equitable principle and after taking into consideration that in the second tender, a sum of ₹2.50 crores was deposited, disposed of W.P.(C)No.38799 of 2024 with the following directions:

The learned Single Judge has also rejected the submission on behalf of the 2^nd respondent that the contracts being separate and requiring final adjudication, set off could not have been allowed. The learned Single Judge have noted that huge amounts are due to the appellant since the year 2015 and while disposing of the writ petition, the appellant was granted the benefit of ₹5,38,27,404/- as set off and an adjustment from the sale consideration payable by the writ appellant’s joint venture and then to pay the balance consideration within the time scheduled in the order. In paragraph 23 (v) it was further clarified that further claims to which the writ appellant is entitled to can be adjudicated before the appropriate forum including the Government of Kerala as adjudicated in the previous proceedings. This would also include resolution of the disputes by arbitration if the contract permits so. The direction for adjustment was based on equitable consideration.

The quantification to interest cannot form the subject matter in the present writ petition. Moreover, admittedly, as observed by the Coordinate Bench, more than Rs. 7 crores would still remained to be paid towards the sale consideration. In spite of repeated opportunities, the said amount was not paid. The capacity to pay the said amount is a relevant consideration. Under such circumstances, we do not find any reason to interfere with the order passed by the learned Single Judge.

The appeal fails and is accordingly dismissed. There shall be no order as to costs.

This judgment shall also dispose of W.P. (C) No. 2354 of 2026. Registry is directed to make appropriate endorsement in its record showing disposal of both the matters.