MECON LTD Vs. PIONEER FABRICATORS P LTD

JUDGEMENT

(1.) MECON Ltd. invited offers as per tender documents to construct five retail outlets for Indian Oil Corporation Ltd. It was a case of a back to back contract. The Bill of Quantities i.e. works to be executed were quantified in detail and the price bid required item-wise price to be quoted. Pioneer Fabricators Pvt. Ltd. (hereinafter referred to as ,,Pioneer) was one amongst the many persons who submitted offers and being the lowest bidder had its offer in sum of RS.2,38,92,519/- accepted, resulting in a work order dated May 31, 2000 being issued to it. It was a term that the work plan shall be finalized and accordingly, styling it as a Letter of Award, on June 13, 2000 the parties finalized in the said written memorandum the detail work-plans to complete the work, and as per which the time within which the work had to be completed at the five sites was fixed at 80 days commencing from the date when a particular site would be handed over. The Letter of Award dated June 13, 2000 clearly recorded that the bid quoted pertained to works to be executed as per Bill of Quantities items, and in respect of any extra item(s) of work, which may be required to be executed price would be paid as mutually determined/fixed by the parties.

(2.) FOUR out of the five sites were handed over on June 06, 2000 and thus qua said four sites the work had to be completed by August 25, 2000 and the remaining one site was handed over on July 12, 2000 requiring the work to be completed at said site by September 30, 2000.

(3.) AS the work progressed, interim bills were raised and running payments released from time to time. This was obviously subject to the works being measured upon completion, since payment had to be made with reference to each item of work with reference to the Bill of Quantities and pertaining to the extra items of work, as per measurements recorded, and at the rate agreed.