Justice N. Anand Venkatesh Delivers Landmark Ruling on Section 23 of the Indian Contract Act.

Justice N. Anand Venkatesh Delivers Landmark Ruling on Section 23 of the Indian Contract Act.

In this landmark judgement, the Hon’ble Mr Justice N. Anand Venkatesh has dealt with the relationship between contractual obligations and statutory compliance in public sector agreements.
His Lordship has meticulously analysed the price adjustment dispute between Indian Hume Pipe and the TWAD Board regarding what would constitute a void agreement under section 23 of the Indian Contract Act.

The Learned Judge referred to the full bench decision of Allahabad High Court in Abdul Hameed vs Mohd Ishaq and the judgment of the Hon’ble Apex Court in the case of G.T.Girish vs. Y.Subba Raju, relied on by the Senior Advocate, Mr. S.Silambanan, Counsel for the TWAD Board. After elaborate discussion, the learned judge held that the word “ Law” referred to section 23 of the Indian Contract Act, section (29) of the General Clauses Act and the Constitution of India would encompass government orders, regulations and administrative directives having legal force, thereby extending the scope of “forbidden by law” beyond mere legislative enactments. The learned Judge concurred with arguments of Senior Counsel,Mr. S.Silambanan that contractual terms violating government orders or Board Proceedings should be deemed void under contract law principles. Mr Justice N. Anand Venkatesh held that contractual clauses contradictiong mandatory government orders become legally void regardless of mutual consent between parties , ensuring administrative accountability, resolving conflicts between contractual terms and government directives in public sector transactions.