L&T Cannot Re-Agitate Seigniorage Dispute After Withdrawing Earlier Writ Without Leave, Holds Andhra Pradesh High Court
Andhra Pradesh High Court holds that a second writ petition on the same seigniorage fee cause of action is barred after the first was withdrawn without permission to file afresh.
The High Court of Andhra Pradesh at Amaravati has dismissed a writ petition filed by M/s. Larsen and Toubro Limited challenging the deduction of seigniorage charges from its running account bills for work done at the Visakhapatnam Steel Plant. Justice Sumathi Jagadam, sitting singly, held that the petition was not maintainable because an earlier writ petition raising the same cause of action had been withdrawn without obtaining leave to file a fresh one. The court applied the ratio of the Supreme Court's decision in Sarguja Transport Service v. State Transport Appellate Tribunal, M.P., Gwalior, reported in 1987 (1) SCC 5, and directed L&T to instead pursue a review or recall of the order passed in that earlier petition.
The Contract and the Seigniorage Dispute
L&T had entered into Agreement No. VSP/CONT/C-06 of 2016-17 dated 17 August 2016 with M/s. Rashtriya Ispat Nigam Limited (RINL), the Visakhapatnam Steel Plant, for the execution of works under the VSP-AWSR Project. In the course of executing the contract, L&T excavated earth and reused it on-site.
By a communication dated 3 March 2023, the respondents withheld and recovered seigniorage charges from L&T's running account bills. L&T's position was that earth excavated and reused in the execution of the same works was not liable to seigniorage fee at all. RINL was arrayed as Respondent No. 2, with M/s. WAPCOS Ltd. as the project engineer, and the Director and Assistant Director of Mines and Geology, Vijayawada, as Respondents 4 and 5. The Union of India and the State of Andhra Pradesh were also made parties.
L&T sought a writ of mandamus declaring the levy illegal and directing RINL to release payments from the RA Bills without any deductions towards the purported seigniorage charges. An interim application under Section 151 CPC was also filed seeking stay of deductions pending final disposal.
The Earlier Writ and Its Withdrawal
The writ petition filed on 10 August 2023 enclosed, as Annexure P.6, a copy of the order passed in W.P.No.4720 of 2018. That earlier petition, filed in respect of the same cause of action, had been withdrawn by L&T itself on the ground that the cause had not survived. The impugned communication of 3 March 2023, which formed Annexure P.9 in the present writ, itself referred to the filing of W.P.No.4720 of 2018.
The court observed that on reading the order in W.P.No.4720 of 2018, it was plain that the earlier petition had been withdrawn without the court granting liberty to file a fresh writ petition. That fact raised a threshold question: whether the present writ petition, filed thereafter on the same subject matter, was maintainable at all.
Applying the Sarguja Transport Principle
Justice Sumathi Jagadam turned to Sarguja Transport Service v. State Transport Appellate Tribunal, M.P., Gwalior, 1987 (1) SCC 5. The court extracted paragraph 8 of that judgment at length, which explained the mischief that the principle is designed to prevent.
The Supreme Court in Sarguja Transport had noted that litigants frequently seek to withdraw writ petitions without seeking permission for a fresh filing — often when the court signals it is unlikely to admit the petition. A court that declines to admit a petition would not ordinarily grant liberty to file afresh; it may simply permit withdrawal. In those circumstances, allowing a second petition on the same cause would permit a form of bench-hunting and would undermine the administration of justice.
The Supreme Court had accordingly extended the principle underlying Order XXIII Rule 1 of the Code of Civil Procedure to writ petitions filed under Articles 226 and 227 of the Constitution of India, not on the ground of res judicata, but on the ground of public policy. The remedy under Article 226 must be treated as having been abandoned in respect of the cause of action relied on, once a petitioner withdraws the writ without leave to file afresh. Other remedies — such as a suit or a petition under Article 32 of the Constitution of India — are not necessarily barred, because withdrawal does not operate as res judicata.
Applying that ratio, the Andhra Pradesh High Court held that since the subject matter of W.P.No.4720 of 2018 and the present W.P.No.20798 of 2023 were the same, and the earlier withdrawal had been without leave, the question of maintainability was the primary issue and had to be decided against L&T.
L&T's Citations on the Merits Left Unaddressed
L&T's counsel had filed a list of decisions from 2007 onwards relating to the merits — specifically, whether the levy of seigniorage fees on excavated and reused earth was legally justified. The court declined to address any of those citations, finding that the threshold maintainability question was dispositive.
L&T had also sought to argue a change in cause of action. The court rejected that contention as well. The final completion certificate in the contract had been issued on 20 October 2022, and a copy of that certificate had been filed in W.P.No.4720 of 2018 itself. The court therefore held that the completion certificate did not create a fresh cause of action distinct from the one already agitated and withdrawn.
The Appropriate Remedy Identified
Rather than leaving L&T without any indicated path, Justice Sumathi Jagadam observed that the proper course would be to file a petition to review or recall the order dated 9 November 2022, passed in W.P.No.4720 of 2018. The court was careful to note that its findings were confined to maintainability alone.
The court also placed on record that the fifth respondent, the Assistant Director of Mines and Geology, had filed an additional counter affidavit referring to the bill of quantities, one item of which related to payment of royalty. The court expressly refrained from touching the merits, leaving the parties to seek appropriate remedies in accordance with the law.
Order
The writ petition was disposed of on 19 June 2026. No costs were awarded. All miscellaneous petitions pending in the matter, including IA No. 1 of 2023 and IA No. 1 of 2025, were directed to stand closed as a sequel to the disposal of the main writ petition.