Article 299 of the Costitution of India with Case law
🔹 Article 299 of the Constitution of India – Contracts by the Union or States
📘 Text of Article 299
Clause (1):
All contracts made in the exercise of the executive power of the Union or a State shall be:
Expressed to be made by the President (for Union) or the Governor (for State),
Executed on behalf of the President or Governor by authorized persons.
✅ Such contracts are not enforceable unless these conditions are met.
Clause (2):
Neither the President nor the Governor shall be personally liable for the contract.
📌 Key Points of Article 299
| Provision | Explanation |
|---|---|
| Written Contract | Must be formally executed in writing |
| Authority | Must be executed by a person authorized by the President or Governor |
| Official Capacity | Must clearly indicate it is made in the name of the President/Governor |
| No Personal Liability | President/Governor cannot be held personally liable |
| Objective | Prevent unauthorized commitments & ensure legal accountability |
⚖️ Important Case Laws on Article 299
🔹 K.P. Chowdhary v. State of Madhya Pradesh, AIR 1967 SC 203
Facts: Oral agreement with the state was not formally executed.
Held: Contract not valid since it didn't comply with Article 299(1).
Key Principle: Oral or informal contracts are void even if benefits were derived.
🔹 Bhikraj Jaipuria v. Union of India, AIR 1962 SC 113
Facts: Supply contract with Union not made in the name of the President.
Held: Contract not enforceable; Article 299 is mandatory, not directory.
Importance: Reinforced the formalities are not procedural, but essential.
🔹 State of Bihar v. Karam Chand Thapar & Bros. Ltd., AIR 1962 SC 110
Issue: Whether ratification by the State of an unauthorized contract makes it valid.
Held: No ratification is permissible unless the contract strictly complies with Article 299(1).
Key Learning: Even subsequent approval cannot validate a contract made in violation.
🔹 Mulamchand v. State of Madhya Pradesh, AIR 1968 SC 1218
Held: Contract not enforceable as it was not in accordance with Article 299.
However, if a party has rendered services, they may be entitled to compensation under Section 70 of the Indian Contract Act (Doctrine of Quasi-Contract).
🔹 R.D. Shetty v. International Airport Authority, AIR 1979 SC 1628
Relevance: Even though not solely about Article 299, the case emphasized public law principles in government contracts, and the need for non-arbitrariness.
💡 Why Article 299 Is Important
Prevents fraudulent or unauthorized deals in government business.
Ensures government contracts are made with accountability and transparency.
Protects public money and resources by laying down clear legal procedure.
📜 Difference from Private Contracts
| Feature | Government Contracts (Art. 299) | Private Contracts |
|---|---|---|
| Execution | Must follow Article 299 formalities | Can be oral or written |
| Authority | Must be by authorized person | Can be any competent individual |
| Enforceability | Non-compliance = void | Can be ratified later |
| Personal liability | President/Governor not liable | Parties liable |
✅ Conclusion
Article 299 acts as a constitutional safeguard ensuring that government contracts are entered into with proper authorization and formality. It protects the state and the public from the consequences of unauthorized commitments. Non-compliance leads to absolute invalidity, making adherence critical.
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