ANIL BUILDCON Vs. STATE OF CHHATTISGARH

JUDGEMENT

(1.) In WPC No.2694 of 2018 petitioner has sought quashment of the communication dated 4-9-2018 (Annexure - P/1) issued by the Executive Engineer, Public Works Department, Korea Division, Manendragarh, addressed to the respondent No.5 State Bank of India invoking encashment of bank guarantees in contract No.10/DL year 2014-15 and No.11/DL year 2014-15. The same communication has again been assailed in WPC No.2707 of 2018, therefore, both the writ petitions are decided by the common order, albeit they are reserved on different dates.

(2.) The petitioner entered into two different contracts with the Public Works Department bearing contract No.10/DL year 2014-15 and No.11/DL year 2014-15 for construction of road and has executed Bank Guarantee for Rs.95.00 lacs on dated 20-12-2017 and for Rs.62.50 lacs on dated 21-10-2016, respectively. Both the Bank Guarantees are valid on the date of invocation. On allegation that an amount of Rs.38.19 lacs in contract No.10/DL year 2014-15 and Rs.14.54 lacs in contract No.11/DL year 2014-15 is to be recovered from the petitioner the Department proceeded to recover the amount by invoking the Bank Guarantee.

(3.) The petitioner would contend that it has executed the entire contract satisfactorily; therefore, invocation of Bank Guarantee is entirely arbitrary and unreasonable. It is also stated that the impugned invocation of Bank Guarantee is in violation of principles of natural justice.