PURNA NAND Vs. UNION OF INDIA

JUDGEMENT

(1.) THE challenge in this petition is to the award dated 29.01.2007 limited to the extent that the learned Arbitrator has not allowed the claim No. 3 of the petitioner herein for loss of business @ 15% amounting to Rs.26,84,467/ -.

(2.) SOME of the facts are that the petitioner submitted his bid for construction of foot over bridge with escalators for pedestrian across the Ring Road at (i) Moti Bagh near Gurudwara, Ring Road, New Delhi, (ii) near Venketaswara College at Ring Road, New Delhi. The estimated cost of the work was Rs.1,54,00,941/ -. The petitioner along with the bid deposited an earnest money of Rs.3,08,015/ -. The total contract value was Rs.1,78,96,447/ -. The bid of the petitioner was accepted vide letter dated 23.02.2006. Pursuant to letter of acceptance dated 23.02.2006, the petitioner submitted a Performance Guarantee of Rs.8,95,000/ -. The dates of starting and completion of work were March 04, 2006 and July 03, 2006 respectively. The petitioner vide his letter dated March 02, 2006 raised an issue of drawing and the site having not been handed over to him till that date. The aforesaid letter was followed by his letter dated March 10, 2006 wherein he has reiterated his request regarding drawings. In his letter dated 27.03.2006 the petitioner reiterated his earlier request and had also stated that the rates of steel and other products have increased in the last one week, and requested that the price of the steel products need to be adjusted by the concerned department. On 07.04.2006 the respondent No. 1 handed over preliminary drawings and sketches to the petitioner, which according to the respondent were enough to start the procurement of the steel material and fabrication of different members. This position has been accepted by the petitioner in his letter dated 10.04.2006 but reiterated his earlier stand regarding rates of steel products having been increased because of which he could not purchase the material in time due to non availability of the drawings. He makes a claim for difference in cost of steel products. On 12.04.2006 the respondent No. 1 informed the petitioner that the issue of removal of electrical wire (high tension wire) has been taken with the department concerned and calls upon him to start the work of foundation, column, beam, ramp etc. on the basis of the available drawing. The respondent No. 1 had also stated that there is no provision in the agreement for payment of increase and decrease of any items. The petitioner again in his communication dated 26.04.2006 requested for the removal of electrical poll and handing over of the complete set of the drawings. He had also brought to the notice of the respondent No. 1, the aspect of his labour sitting idle. Ultimately on 29.04.2006, the petitioner on the ground that the working drawings had not been given to him till that date, requested for closure of the agreement. On 16.05.2006, the respondent issued a show cause notice calling upon the petitioner to explain why the work could not be started and the earnest money and performance guarantee be not forfeited after the closure of the agreement. It appears that vide letter dated 30.05.2006 the respondent No. 1 had terminated the contract and forfeited the earnest money and performance guarantee as was given by the petitioner. Suffice to state that even in the earlier communication before 30.05.2006 the petitioner had sought for the refund of performance guarantee and earnest money. In fact even in a communication subsequent to the communication dated 30.05.2006 of the respondent No. 1 i.e. 06.06.2006 the petitioner requested for the refund of earnest money and the amount of performance guarantee with interest. In response to this letter of the petitioner, the respondent No. 1 reiterated its stand of forfeiting the earnest money as well as the amount of the performance guarantee.

(3.) I note from the record that the matter was referred to the arbitration of Mr. Diwarkar Garg, Ministry of Urban Development, Delhi. The following were the claims made by the petitioner before the Arbitrator.