The executive of the State Government entered into a contract with suppliers for the supply of materials for the construction of houses for the poor. Due to urgency, a lower division clerk signed the contract without the knowledge of his superiors. Can the suppliers claim the amount from the Government for the goods supplied?
TheSayeed Answered question March 15, 2024
Facts of the Case:
- The State Government’s executive entered into a contract with suppliers for providing materials for the construction of houses for the poor.
- The contract was signed by a lower division clerk without the knowledge or authorization of his superiors.
Issue in the Case:
- Can the suppliers demand payment from the Government for the goods supplied under the contract signed by an unauthorized person?
Principle:
- Article 299 of the Indian Constitution specifies the conditions for a contract to be binding on the Government.
- These conditions include:
- The contract must be expressed to be made by the President or the Governor of the State.
- It must be executed on behalf of the President or the Governor.
- Its execution must be by an authorized person and in an authorized manner by the President or Governor.
Judgement:
- If the contract fails to meet any of the conditions specified in Article 299, it is considered null and void, rendering it unenforceable.
- In this case, since the contract was signed by a lower division clerk without proper authorization, it does not meet the conditions outlined in Article 299.
- Therefore, the suppliers cannot claim payment from the Government for the goods supplied under this unauthorized contract.
Thus, based on the legal principle outlined in Article 299, the suppliers cannot enforce the contract against the Government due to the unauthorized signing by the lower division clerk.
TheSayeed Answered question March 15, 2024