Private Contract Dispute Not Amenable To Writ Jurisdiction Merely Because Government Authority Is Contracting Party: Delhi High Court
The Court refused to interfere with the termination notice issued by NBCC (India) Limited and the subsequent re-auction process.
The Delhi High Court has held that the extraordinary writ jurisdiction under Article 226 of the Constitution of India cannot be invoked to adjudicate purely commercial and contractual disputes requiring resolution of disputed questions of fact, even if one of the contracting parties is the State or an instrumentality of the State.
Adjudicating a writ petition challenging the cancellation of a bulk commercial allotment in the redevelopment project "Down Town, Sarojini Nagar", the Court refused to interfere with the termination notice issued by NBCC (India) Limited and the subsequent re-auction process, observing that claims for enforcement or restoration of commercial contracts belong strictly in the realm of private law and civil remedies.
A Division Bench comprising Justice Anil Kshetarpal and Justice Amit Mahajan observed, “…The jurisdiction of the High Court under Article 226 is essentially a public law remedy intended to ensure fairness in the exercise of statutory and public duties. Merely because one of the contracting parties happens to be the State or an instrumentality of the State does not, by itself, convert every contractual dispute into a matter amenable to judicial review under Article 226”.
Advocate Mohit Choudhary appeared for the petitioner and Chetan Sharma, ASG appeared for the respondent.
The Ministry of Housing and Urban Affairs (MoHUA) is the owner and promoter of the commercial built-up space project "Down Town, Sarojini Nagar, New Delhi", with NBCC (India) Limited acting as the executing and implementing agency. Following an e-auction conducted on July 22, 2024, an allotment letter dated August 31, 2024, was issued in favor of M/s Mansan Builders Private Limited for 598 retail and office units, followed by an Agreement for Sale dated March 6, 2025. Disputes subsequently arose regarding adherence to the payment schedule, leading NBCC to issue a termination notice on April 8, 2026, and a fresh Notice Inviting Offer on May 7, 2026, for re-auctioning the commercial space.
Aggrieved by the termination, the petitioner initially approached the Delhi Real Estate Regulatory Authority, where an interim status quo order was granted on April 13, 2026, but later vacated on May 7, 2026.
The petitioner previously filed a writ before the High Court challenging the termination, which was disposed of as withdrawn on May 29, 2026, with liberty to submit a representation to the respondents.
Following the rejection of its representation on June 1, 2026, and the commencement of the re-auction process wherein third-party rights intervened for several units, the petitioner instituted the present writ petition seeking restoration of the original allotment and cancellation of the re-auction notice.
The Court observed that public law remedies under Article 226 of the Constitution of India are not designed to resolve private contractual grievances or enforce specific performance of commercial contracts.
The Bench noted that the petitioner’s challenge to the fresh tender process had substantially worked itself out since subsequent auction sales had taken place and third-party rights had intervened without those buyers being impleaded. Addressing the surviving challenge against the termination notice, the Court held that deciding whether the builder defaulted in payments or whether NBCC failed to execute conveyance deeds and reconcile accounts requires detailed evidence, account reconciliation, and factual assessment. The Court further noted that successive writ petitions filed on substantially the same cause of action within a short timeframe disentitled the petitioner from seeking equitable discretionary relief.
Accordingly, the High Court dismissed the writ petition, holding that no ground was made out to interfere with the withdrawal, cancellation, or termination of the contractual arrangement under Article 226. The Bench left it open for the petitioner to pursue such alternative civil or statutory remedies as may be available under the law, clarifying that all rights, contentions, and merits of the underlying contractual disputes between the parties remain open.
Cause Title: M/s Mansan Builders Private Limited v. Union of India & Anr. (Neutral Citation: 2026:DHC:6141-DB)
Appearances:
Petitioner: Mohit Choudhary, Kunal Sachdeva, Aarushi Suri Lakshay Yadav, and Puluk, Advocates.
Respondent: Chetan Sharma, ASG, Sidhant Goel, Mohit Goel, Suman Doval, Aishna Jain, Kratvi Kawdia, Naman, Shubham Sharma, and Amit Gupta, Ashish K Dixit, CGSC, Sushil Tekriwal and Dr. Mamta Tekriwal, Advocates.