(1.) The present writ petition has been filed challenging a communication dtd. 8/6/2023 issued by the Ministry of Railways, Government of India by which it has communicated its decision to forfeit and encash a performance bank guarantee dtd. 30/11/2021 for the sum of ?25.20 lakhs. The performance bank guarantee was submitted by the petitioner in support of a bid for supply of 1000 nos. Box N/BG Axle in terms of the specifications stated in the tender documents.
(2.) The petitioner is a small scale industry registered under the Micro, Small and Medium Enterprises ["MSME"] Development Act, 2006. It participated in the aforesaid tender and was awarded the tender by the Ministry of Railways, Government of India, by a letter of acceptance dtd. 17/11/2021. The delivery period specified in the letter of acceptance was 'D+30 weeks', 'D' being the date of the Development Order. It is undisputed that the Development Order in the present case was issued on 29/12/2021, and the period of 30 weeks therefrom would conclude on 26/7/2022.
(3.) The contention of the petitioner in the writ petition is that it was unable to supply the axles in terms of the aforesaid contract due to the investment required for manufacturing of axles, in terms of the technical specifications in the tender. The petitioner was earlier in the business of forging and had disclosed that it had not supplied axles previously. Ms. Purti Gupta, learned counsel for the petitioner, submits that the petitioner was not aware of the extent of investment required for manufacturing of axles, particularly with regard to the required heat treatment facility, and such information was also not disclosed in the tender document. She states that the petitioner was unable to invest resources at the required level. The petitioner, in fact, visited the wheel and axle plant of the Indian Railways in Bangalore in June 2022, and was surprised to see its scale and the equipment required for the manufacturing process. It therefore requested the Ministry of Railways to cancel the Development Order.