Holding

The e‑auction scheme is ultra‑violus of Article 14 and coal companies must refund the excess price paid, and the High Court’s order directing such refund is affirmed.

Summary

The appeal challenges a Calcutta High Court order that upheld a writ petition against the e‑auction scheme for coal sales. The Supreme Court had earlier, in Ashoka Smokeless Coal India Ltd. v. Union of India (2007) 2 SCC 640, declared the e‑auction scheme ultra‑violus of Article 14 and directed coal companies to refund any excess price paid. The Court held that this ratio applies to all pending writ petitions in various High Courts, not only to cases before the Supreme Court. It also rejected the respondents’ attempt to invoke a plea of unjust enrichment that was not raised in the original proceedings. Consequently, the High Court’s order directing the respondents to refund the excess amount was affirmed and the appeal was dismissed.

Issues considered

Whether the Supreme Court's decision in Ashoka Smokeless Coal India Ltd. v. Union of India (2007) 2 SCC 640 is binding on pending writ petitions in other High Courts concerning the e‑auction scheme.
Whether the respondents can avoid refunding the excess price on the ground of unjust enrichment when such a plea was not raised in the original writ petition.
Whether the Calcutta High Court's order directing refund of excess price is valid in view of the constitutional challenge to the e‑auction scheme.

Legislation cited

Constitution of Indias. Article 14

Subjects

e‑auctionrefund of excess priceArticle 14unjust enrichmentconstitutional challengecoalSupreme Courtquashing scheme

Judgment

[2011) 9 S.C.R. 1103

EASTERN COALFIELDS LTD. A
v.
M/S TETULIA COKE PLANT (P) LTD. & ORS.
(Civil Appeal No. 6888 of 2011)

AUGUST 10, 2011
B
[DR. MUKUNDAKAM SHARMA AND
ANIL R. DAVE, JJ.]

COAL:
c
Refund of excess price paid - Scheme of a-auction
introduced by Union of India - Held ultra vires of Article 14
of the Constitution and quashed by Supreme Court in Ashoka
Smokeless Coal India (P) Ltd. - Coal companies directed to
refund the excess amount paid by the purchasers - Writ
0
petition involving similar issues pending before High Court
- Disposed of, following the decision of Supreme Court in
Ashoka Smokeless Coal India's case - Held: It cannot be
. said that the effect of the decision in Ashoka Smokeless Coal
India's case would be restricted only to those cases which E
were before the Supreme Court and not for all cases which
were pending in different High Courts at that stage, at least
to the issues which were common in nature - Without taking
a plea of unjust enrichment either in the writ petition or before
the Supreme Court, the plea cannot be entertained at the time
of argument, particularly, in view of the fact that the F
respondents did not have any notice of such a plea taken for
the first time at argument stage - In the instant case, it is a
case of refund of price recovered by the appellant in excess
and not of any kind of payment of tax or duty - Besides, the
appellant has already refunded such excess amount realised G
to many other parties without raising any such plea - If
anything is done by a party in violation of the law,
consequence has to follow and the party is bound to return
the money to the parties from whom excess amount has been
1103 H
·\
1104 SUPREME COURT REPORTS [2011) 9 S.C.R.

A realised - Pursuant to the orders of Supreme Court, the
accounts in terms of the ord,3rs of the High Court have been
verified and the said accounts have been settled -Therefore,
appropriate steps shall be taken to give effect to the judgment
and order passed by the High Court - The amount in terms ...
B of the settled accounts shall be paid by the respondents in
accordance with law - Unjust enrichment - Plea - Constitution
of India, 1950 - Article 14.
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
6888 of 2011.
c
From the Judgment and Order dated 04.10.2010 of the
High Court of Calcutta in APO No. 226 and 321 of 2010, WP
No. 1279 of 2005 and GA No. 1929 of 2010.

D P.P. Malhotra, ASG, Anip Sachthey, Mohit Paul and
Shagun Matta for the Appellant.
Ashwani K. Dhatwalia, Piyush Meharia, Amit Meharia and
Meharia & Company for thEl Respondents.

E The following order of the Court was delivered

ORDER
'If"!
Leave granted.

F This appeal is directed against the judgment and order
dated 4.10.201 O passed by the Calcutta High Court whereby
the Division Bench of the High Court dismissed the appeal of
the Appellant herein and while doing so, affirmed the findings
and conclusions arrived at by the learned Single Judge.
G
A writ petition was filed by the respondents herein before
the Calcutta High Court which was registered as Writ Petition
' "-

No. 1279 of 2005. In the said writ petition the respondents
challenged the legality of the e-auction scheme introduced by
the Union of India and adopted by the Appellant herein. In the
H
EASTERN COALFIELDS LTD. v. TETULIA COKE 1105
PLANT (P) LTD. & ORS.
)
"' said writ petition, an interim order was also passed on A
08.08.2005 with regard to the liability for payment of price for
purchasing coals under e-auction scheme and for furnishing
bank guarantee in connection thereof.
-I
~
During the pendency of the said writ petition in the High B
Court, some other writ petitions involving similar issues and
also pending before the Calcutta High Court and also other
High Courts were transferred to this Court. This Court passed
certain interim orders. However, finally the said cases were
taken up for final hearing and were disposed of by a judgment
and order rendered on 01.12.2006 in the matter of Ashoka
c
Smokeless Coal India (P) Ltd. & Ors. Vs. Union of India &
Ors. reported in (2007) 2 SCC 640. By the said judgment and
j order this Court upheld the challenge of the writ petitioners
therein to the scheme of e-auction. This Court in the said
judgment further held that the said scheme of e-auction was D
invalid. Consequently, this Court declared the same as ultra
vires of Article 14 of the Constitution of India and quashed the
said e-auction scheme.
Contempt petitions were filed by some of the parties- E
thereto in which several orders came to be passed by this
Court whereby this Court directed the coal companies for
refunding the excess amount paid by the purchasers who were
petitioners before this Court in those cases.
F
The writ petition filed by the respondents, however, was
pending consideration before the High Court. After the disposal
of the cases involving similar issues which were raised and
also disposed of by the aforesaid decision, which is now
reported in (2007) 2 SCC 640. The writ petition of the
respondents herein also was taken up for consideration and a G
-'I • judgment and order was passed by the learned Single Judge
disposing of the said writ petition on 25.03.2010. By the said
order the High Court followed the decision of this Court in
Ashoka Smokeless Coal India (P) Ltd. (supra) and passed
orders and certain directions. The respondents were directed H
1106 SUPREME COURT REPORTS [2011] 9 S.C.R.

A to furnish all documents to the counsel for coal company
showing actual payments made by the respective applicants
during the period from May, 2005 to December, 2006 and the
difference between the amount paid and the amount notified
by April 30, 2010. Another din~ction which was passed was that
B the documents furnished shall be verified by the concerned coal
companies and in case of any difference, the parties to
deliberate upon the matter so as to enable them to come to
an accepted solution.

The legality of the aforesaid judgment and order came to
C be challenged by filing an appeal before the Division Bench of
the High Court which was dismissed, as stated hereinbefore.
Still aggrieved, the Appellants have filed the present appeal on
which we have heard the learned counsel appearing for the
parties.
D
Mr. P.P. Malhotra, learned Additional Solicitor General has
submitted before us that the respondents herein were not
parties when the matter was heard by this Court nor were they
parties when the interim orders were passed by this Court and,
E therefore, the respondents cannot g~t the benefit which arises
out of the interim orders passed and the final orders passed
by this Court in the case of Ashoka Smokeless Coal India (P)
Ltd. (supra). It is submitted that as their writ petition was a
separate writ petition, the same will have to be considered on
F its own facts and merit. The learned Additional Solicitor General
also sought to submit that to the facts of the present case, the
principles of unjust enrichment would be applicable and on that
ground also the respondents cannot claim for any refund
claiming payment of the same.
G We have also heard the counsel appearing for the
respondents on the issues raised. Having considered the
submissions and having gone through the records, we proceed
to dispose of this appeal by recording our reasons thereof.
H There is no dispute with regard to the fact that the legality
EASTERN COALFIELDS LTD. v. TETU LIA COKE 1107
PLANT (P) LTD. & ORS.
. ') ~
of the scheme of e-auction was challenged by filing writ A
petitions in various High Courts by the traders and companies
dealing with coal. Some of those petitions were transferred to
this Court pursuant to orders of this Court, the leading case
being Ashoka Smokeless Coal India (P) Ltd. (supra) which
..... was taken up for consideration along with connected matters B
-'
and the same were disposed of by this Court and the said
decision is now reported in (2007) 2 SCC 640. By the
aforesaid judgment, this Court has upheld the challenge of the
writ petitioners to the legality of the scheme of e-auction. The
aforesaid prayer of the writ petitioners was accepted and this c
Court held that the scheme of e-auction was invalid and violative
of Article 14 of the Constitution of India and, therefore, it was
declared to be ultra vires to the Constitution and this Court
_,,
quashed the e-auction scheme. It must be indicated herein that
the present respondent also filed the writ petition in question
D
in the Calcutta High Court before the aforesaid decision was
rendered and in his case also interim order was passed by the
Calcutta High Court. After the disposal of Ashoka Smokeless
Coal India (P) Ltd., the writ petition filed by the respondent
herein which was pending was also considered and the same
was allowed following the decision of this Court in Ashoka
E
Smokeless Coal India (P) Ltd. (supra) as by that decision, this
Court has declared the entire scheme to be invalid and ultra
vires to the Constitution. Therefore, any action taken pursuant
·' to the said scheme is also illegal and null and void. Following
the ratio of the said decision this Court directed the coal F
companies to refund the price of the coal paid in excess of the
notified price under e-auction scheme. Certain guidelines were
also laid down as to how such payments is to be made. The
said decision of the learned Single Judge was upheld by the
Division Bench of the High Court by affirming the conclusions G
_, and analysing all the issues that were raised before it.
We are unable to accept the contention of the learned
Additional Solicitor General that whatever is challenged in the
present petition is only an interim order. It is not so because H
1108 SUPREME COURT REPORTS [2011] 9 S.C.R.

A the respondents herein also challenged the legality of the e-
auction scheme in the writ pe:tition. The High Court has not
disposed of only an interim prayer but has disposed of the
entire writ petition by its judgment and order dated 25.03.2010.
Consequently, it must also be held that when the entire scheme
B is set at naught by this Court, whatever action has been taken
following the said e-auction by the coal company has also been
declared to be illegal and, therefore, the coal company has
become liable to refund the entire money which was collected
in excess of the notified price. That is the consequence of
c quashing of the scheme and the same came to be reiterated
by this Court while contempt petitions were filed and were
disposed of. Therefore, it cannot be said that the effect of the
decision of Ashoka Smokeless Coal India (P) Ltd. (supra) ,_
would be restricted only to those cases which were before this
Court and not for all cases which were pending in different High
0
Courts at that stage, at least to the issues which are common
in nature.

Learned Additional Solicitor General has also submitted
before us that the respondents are not entitled to the benefit, if
E they are otherwise entitled to on the principles of unjust
enrichment. We specifically asked the learned Additional
Solicitor General during the course of the arguments to show
us whether any such plea was taken in the writ petition which
was filed before the lea.rned Single Judge. The learned
F Additional Solicitor General was unable to show that any such
defence or plea was taken about unjust enrichment in the
pleadings. filed before the learned Single Judge. Such an issue
was also not argued before the learned Single Judge as no
such reference is there in the order of learned Single Judge. It
G is, however, stated by thei learned Additional Solicitor General
that such an issue was raised before the Division Bench. But
we could not find the same raised in pleadings nor was it
considered. But a mention is made in the judgment that such
a plea was argued. However, on going through the records, we
H find that no such ground has also been taken even in the
EASTERN COALFIELDS LTD. v. TETU LIA COKE 1109
PLANT (P) LTD. & ORS.
) -Jo
Memorandum of Appeal filed in the present appeal. Therefore, A
without taking a plea of. unjust enrichment either in the writ
petition or before this Court, we are not inclined to allow him
to argue the plea at the time of argument and entertain such a
plea, particularly, in view of the fact that the respondents did
...
not have any notice of such a plea taken for the first time at
-· argument stage. In the present case, it is a case of refund of
B

price recovered by the appellant in excess and not of any kind
of payment of tax or duty. Besides, the appellant has already
refunded such excess amount realised to many other parties
without raising any such plea. c
If anything is done by a party in violation of the law,
consequence has to follow and they are bound to return the
.~ money to the parties from whom excess amount has been
.I
realised. There is also no document placed on record in
support of any such plea. Bald allegation of this nature cannot D
be accepted particularly when no such plea has been raised
in this Court.
In that view of the matter, we find no reason to take a
different view than what is taken by the learned Single Judge E
• of the High Court of Calcutta as also by the. Division Bench of
'\ the same Court. Pursuant to the orders passed by this Court,
' the accounts in terms of the orders of the learned Single Judge
1 has been verified and the said accounts have been settled.
Therefore, appropriate steps shall be taken now to give effect F
to the judgment and order passed by the learned Single Judge.

The amount in terms of the settled accounts shall be paid
by the respondents in accordance with law within a period of
two months, failing which the amount will carry an interest @9%
per annum. G
<
'
In terms of the aforesaid order, this appeal is disposed of,
leaving the parties to bear their own costs.
R.P. Appeal disposed of. H