NATIOANL HIGHWAYS AUTHORITY OF INDIA Vs. SHIVA TRACTORS

JUDGEMENT

(1.) Heard Sri Syed Farman Ali Naqvi, learned counsel for the appellant and Sri K. K. Tiwari, learned counsel appearing for the respondent.

(2.) Shorn of unnecessary details facts, relevant for the purposes of the case, are as under:

(3.) The appellant, herein, vide "Bid Invitation Notice" dated 06.01.2005 invited offers from parties for collection of toll fee on behalf of Government of India at Km. 34, Village Baretha, Tehsil Mania, District Dholpur (Rajasthan) for Km.8.00 to Km. 51.00 Km on Agra-Dholpur Section of NH No. 1. The offer submitted by the respondent, herein, having been accepted, the parties entered into a contract dated 28.03.2006 for the said purpose. On the basis of certain alleged complaints and alleged in-house investigation into the same, the appellant vide its letter dated 27.07.2006 terminated the contract. The respondent challenged the termination of the contract before the High Court of Madhya Pradesh which was disposed of vide order dated 08.08.2006 directing the appellant to issue fresh show cause notice to the respondent after supplying copy of the inquiry report. Thereafter a fresh notice dated 22.08.2006 was issued to the respondent and vide order dated 14.11.2006, the contract was terminated with immediate effect and invoking Clause 18 and 34(2) of the agreement, penalty forfeiting the performance security to the tune of Rs.1,43,87,651/- was imposed. The bank guarantee was also invoked.