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    Contractual Liability of The Government: Tusharika Singh Roll Number-411

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    The document discusses the contractual liability of governments and how while Article 299 was intended to protect governments from unauthorized contracts, the expanding role of governments in modern welfare states calls into question whether it is individuals who need protection from governments. It raises the issue of whether there should be public law to make governments substantively liable for their contractual obligations.

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    Contractual Liability of The Government: Tusharika Singh Roll Number-411

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    Ar Soni
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    The document discusses the contractual liability of governments and how while Article 299 was intended to protect governments from unauthorized contracts, the expanding role of governments in modern welfare states calls into question whether it is individuals who need protection from governments. It raises the issue of whether there should be public law to make governments substantively liable for their contractual obligations.

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    The document discusses the contractual liability of governments and how while Article 299 was intended to protect governments from unauthorized contracts, the expanding role of governments in modern welfare states calls into question whether it is individuals who need protection from governments. It raises the issue of whether there should be public law to make governments substantively liable for their contractual obligations.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    443 views32 pages

    Contractual Liability of The Government: Tusharika Singh Roll Number-411

    Uploaded by

    Ar Soni
    The document discusses the contractual liability of governments and how while Article 299 was intended to protect governments from unauthorized contracts, the expanding role of governments in modern welfare states calls into question whether it is individuals who need protection from governments. It raises the issue of whether there should be public law to make governments substantively liable for their contractual obligations.

    Copyright:

    © All Rights Reserved
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    of 32

    CONTRACTUAL LIABILITY OF

    THE GOVERNMENT

    TUSHARIKA SINGH
    ROLL NUMBER- 411
    LESSON PLAN
    Class LL.M. I Semester

    Subject Government Contract; Principles,


    Procedures and Liabilities
    Topic Contractual Liability Of the
    Government

    Time Available 20 Min.


    What

    Why

    How
    • What is the importance of the contractual Liability of the Government ?

    • Why this topic has been chosen by me ?

    • How this has become relevant in todays time ?


    • Important and relevance
    • Reason for selecting of the contractual Liability of the Government as
    • Essence of the contractual Liability of the Government
    • Reason why it is good for todays time
    In the modern era of a welfare state,
    government's economic activities are expanding and the
    government is increasingly assuming the role of the dispenser of a
    large number of benefits. This raises the possibility of exercise of
    power by a government to dispense largess in an arbitrary manner.
    However to bind the government in contractual liability the three
    requisites of article 299 must be there. This provision was inserted
    to safeguard the government from unauthorised contracts but with
    the evolution of the welfare state and extent of its functions, is it
    the government that requires this protection or the individuals that
    enter into contracts with it. And also whether there should be
    substantive public law to make the government liable?
    Aims & Objectives :
    To provide comprehensive understanding of;
    • Government contract and difference between private contract and government
    contract.
    • Essential requirements to enter in contract with government.
    • A brief note of various kinds of liability depending upon the nature of dealing
    with the government.
    • Law relating to contractual liability in other countries.
    • Judicial interpretation of contractual liability and extent of judicial intervention
    in government contract.
    Learning Outcomes :

    At the end of the class students will be able to;

    • Knowing the basic understanding about government contract applicable in


    India.

    • Identify that the contracts are made following the prescribed procedure.

    • Generate the capacity to compare the law with other countries.

    • Know judicial approach towards government contract.


    Liability Of The Government

    Tortious Liability Statutory liability Contractual Liability


    ESSENTIAL REQUIREMENT TO FORM GOVERNMENT
    CONTACT U/A 299

    1. Written Contract
    2. Execution by authorised person
    3. Expression in the name of president( Governor)
    Difference B/w Government Contract
    And Private Contract
    Government Contract Private Contract

    1. It has to fulfil requirement of Article 299 1. It can be written/oral, expressed/implied


    of the constitution. etc.

    2. There may arise problems of public law as 2. There is nothing like that
    Fundamental right, writ jurisdiction, Natural
    justice.

    3. Longer limitation period is provided to 3. No such privilege is provided in case of


    government u/a 112 of Limitation Act 1963 disputes between private parties.
    to file a case.

    4. It may involve not only supplies or 4. It may just to provide supplies and services
    services but also livelihood , be instrument of
    implementation of Government policies.

    5. As govt. contract involves public interest 5. It is not relevant to private contract.


    and public finance is affected it is subject to
    certain limitations- constitutional, legal and
    moral.
    LAW IN OTHER COUNTRIES

    LAW IN U.K LAW IN U.S. LAW IN INDIA

    .Before 1947- immunity . Till 1978 there was ‘dispute; . Before constitution-
    based on two doctrines- clause . Charter Act 1833- East India
    1. The King by his writ can . Contract Disputes Act 1978 company
    not command itself . Sec. 65 of GOI Act 1858-
    2. The King can do no secretary of state
    wrong. .Post Independence- Liability
    same as of an individual u/ ICA
    .Crown Proceedings Act,1947. 1872, only requisites of Art. 299
    has to be fulfil
    Judicial Interpretation w.r.t Contractual Liability of Government

    • K.P . Chowdhary v. state of Madhya Pradesh AIR 1967 SC 203


    • State of west Bengal v. B. K. Mondal & Sons AIR 1962 SC 779
    • State of Punjab v. Omprakhash Baldeo Krishan AIR 1988 SC 2149
    • Art.299 of the constitution and Sec. 65 of the Contract Act 1872
    • Art.299 of the constitution and Sec. 70 of the Contract Act 1872
    • Union of India v. Hindustan development Corp. AIR 1994 SC 980
    • In sterling computers Ltd. v. M & N Publication Ltd. AIR 1996 SC 51
    K.P . Chowdhary v. state of Madhya Pradesh AIR 1967

    In view of Art.299(1) there can be no implied contract between the


    government and another person , the reason being that if such implied contract b/w the
    govt. and another person were allowed , they would in effect make Art. 299(1) useless,
    for then a person who had a contract with govt .which was not executed at all in the
    manner provided in art.299(1) could get away by saying that an implied contract may
    be inferred on the facts and circumstances of a particular case.
    In Mahabir auto store v. Indian oil corporation AIR 1990

    The basic principle relating to power of the state to entre into or not
    to entre contract with individuals has been clearly laid down .
    “ it is well settled that every action of the state or an instrumentality in exercise of
    executive power, must be informed by reason , actions unformed by reason may
    be questioned as arbitrary in proceeding under Art. 226 or 32 of the constitution.

    Where a state or an instrumentality of state constituted under Art. 12 of the


    constitution , an action of its executive authority to enter or not to enter into
    contracts is subject Art. 14 of the constitution .
    State of west Bengal v. B. K. Mondal & Sons AIR 1962

    Supreme court held that the object of Art. 299 of the constitution
    of India is to protect the state not to saddle with liability for unauthorised
    contracts.
    State of Punjab v. Omprakhash Baldeo Krishan AIR 1988

    accordingly In this case SC held that if a letter of acceptance is


    signed by the executive engineer for construction of a bridge and not in the name
    of the governor, it can not be said there is a valid contract in conformity with Art.
    299 (1) of the constitution of India.
    Art.299 of the constitution and Sec. 65 of the Contract Act 1872
    Where a contract is not enforceable for non compliance with the
    requirement of Art.299 of the constitution , parties to such contract are to restore the
    benefits under the agreement according to the provisions of sec. 65 of the Contract
    Act 1872
    (Hindustan Construction Co. v State of Bihar AIR 1963 )
    Art.299 Of The Constitution And Sec. 70 Of The Contract Act 1872

    When an agreement becomes invalid for non compliance with art .299 of
    the constitution , person enjoying benefit must restore under sec .70 of the contract.

    (state of W.B v B.K. Mondal &Sons AIR 1962 )


    Other Provisions Of The Indian Contract Act 1872

    Govt. Contract subject to the provisions of Art. 299 of the constitution


    of India and other rules and notifications of the govt. touching any such contract
    ,will ordinarily be governed by the provisions of the Indian contract Act 1872.
    So the provisions relating to performance of the reciprocal promises ,contract
    which need not be performed ,consequence of breach of contract, indemnity,
    guarantee, agency will apply with full force.
    Union of India v. Hindustan development Corp. AIR 1994 SC 980
    •Where in response to an offer for inviting offers for entering into contract with
    the govt. both big and small manufacturers had offered tenders.

    •The tender committee of the railway board fixed one rate for big manufacturers
    and another for smaller manufacturers

    •Such as action under the circumstances was held reasonable and bona fide and it
    is not hit by Art . 14 of the constitution .
    In Sterling Computers Ltd. v. M & N Publication Ltd. AIR 1996 SC 51
    SC held that
    •In exercising the power of judicial review in govt. contracts, the court is to
    consider primarily as to whether there has been any infirmity in the “decision
    making process”

    •By way of judicial review the court can not examine the details of the terms of the
    contract which have been entered into by the public bodies or the state .
    The court has the inherent limitations on the scope of any enquiry

    •But at the same time the court can certainly examine whether “decision making
    process ” was reasonable ,rational , not arbitrary and violation of Art.14 of the
    constitution.
    Teaching Methods Teaching Tools

    Lecture Method PPT (Easy To Convey )

    Brainstorming Notes And Pan

    Group Discussion White Board & Marker

    Laptop
    Microphone
    Projector
    Unit- 1 Legal framework of government contract

    Unit- 2 Nature and Tendering methods

    Unit- 3 Procedure of formation of contract

    Unit- 4 Enforcement and termination

    Unit- 5 Contract claims and ADR system


    content
    Unit- 6 Contractual Liability of government

    Unit- 7 International contract management

    Unit- 8 Ethics in contract

    Unit- 9 Current developments and reforms

    Unit- 10 Sample documents


    CLASS PLAN….. Content Time
    • What, How & Why 2 minute

    • Aims & Objectives and Learning Outcomes 2 minutes

    • Government contract and difference 2 minutes

    • Essential Requirement To Form Government Contact u/a 299 1 minutes

    • Group discussion and brain storming 2 minutes

    • Judicial interpretation 5 minutes

    • Law in other countries 2 minute

    • Teaching method and teaching tool 1 minutes

    • Course content 1 minutes

    • Cushion time 2 minutes


    THANK YOU…

    DO U HAVE ANY QUESTIONS?

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