UPENDRA KUMAR SINGHAL Vs. UOI

JUDGEMENT

(1.) IN terms of Office Memorandum No. DGW/con/193 dated 29th June, 2004 the central Public Works Department has stipulated payment of earnest money as an essential condition for the issue of tender documents to any contractor intending to submit a tender. Aggrieved, the petitioner who is a contractor by profession has assailed the said stipulation in the present writ petition.

(2.) APPEARING for the petitioner, Mr. Bhatia placed reliance upon a decision of the High Court of Madhya Pradesh in Ajay Krishna Vs. Union of India and Ors. 2005 (1) CTLJ 441 (MP), to contend that the deposit of earnest money as a condition precedent for the purchase of tender documents is wholly unwarranted and unjustified. Earnest money deposit, it is argued, is given at the time of conclusion of the contract and not at the time of purchase of the tender documents which is only a step-in-aid of the finalization of a contract. The deposit is meant to guarantee the fulfillment of the contractual obligation. It may even be a part of the purchase price when the transaction is carried out and may be forfeited when the transaction falls through by reason of default or failure of the purchaser. Insistence upon payment of the earnest even in anticipation of submission of a proper tender is, therefore, wholly meaningless and irrational apart from being excessively onerous for any tenderer to even secure the documents without which he cannot determine whether or not to submit a tender.

(3.) THE respondents have opposed the writ petition and filed a counter affidavit. The counter affidavit inter alia states that the respondent-CPWD has modified their policy in general public interest. Mr. Mehta, learned counsel for the respondent argued that the amendment of policy/rule was in no way arbitrary or in violation of Article 14 or 19 (1) (g) of the Constitution of india.