ADVANCED RADIO MASTS LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioner is an incorporated company, which invoked the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India seeking to quash or set aside the two communications dated 12.7.1999 and 30.7.1999 sent to the petitioner. By first impugned letter, the third respondent informed the petitioner that purchase order for supply of Optical Line Terminating Equipment (PDH) could not be placed for the second year. By the second letter, the petitioner was advised to send Crossed Demand Draft/Pay Order for Rs.22,65,000.00 (Rupees twenty two lakhs and sixty five thousand only) equivalent to the bank guarantee given by the petitioner when only the original bank guarantee will be returned to the petitioner. The facts and circumstances leading to filing this writ petition seeking these reliefs in brief are noticed below.

(2.) The Department of Telecommunications (DoT), the first respondent herein issued a Notice Inviting Tender (NIT) inviting tenders for supply of Optical Fibre Line Terminating equipment (hereafter called, the material). The petitioner submitted tenders for two varieties of material mentioned at SL.No.3 and Serial No.7, which were evaluated by Tender Evaluation Committee comprising of Senior Officers of DoT. By communication dated 25.9.1995, DoT placed advance purchase order for procuring material in Package III for 195 numbers and Package VII for 282 numbers. The petitioner manufactured the equipment and offered the same to DoT for type approval. As per NIT and tender schedule, the company's material is subjected to quality control in three stages. In Stage I, the Company has to submit the material for type approval test. In Stage II, the DoT will conduct random sampling test and in Stage III after giving Bulk Production Clearance Certificate (BPC), bulk production order is given. These three stages follow the issue of advance purchase order.

(3.) It is the case of the petitioner that DoT accorded type approval on 28.2.1996 for Package VII and 30.8.1996 for Package III. As required under tender schedules, the petitioner furnished bank guarantee for a sum of Rs.22,65,000.00 (Rupees twenty two lakhs and sixty five thousand only) as a performance bank guarantee for due discharge of its obligation. The same is valid for three years commencing from 14.10.1995. The DoT, thereafter, placed purchase order on 31.1.1996 for supply of 213 numbers of material in Package III and 154 numbers in Package VII and petitioner was required to produce the material valued at Rs.4,65,37,401.90.00 (Rupees four crore sixty five lakhs thirty seven thousand four hundred and one and paise ninety only) over a period of two years. The petitioner states that for a variety of reasons, the supplies of the materials were delayed but the petitioner completed delivery of 158 numbers in Package Vn and 213 numbers in Package in. It is also the case of the petitioner that whenever there was a delay, the petitioner approached the DoT, who condoned the delay and extended the time for supply by imposing liquidated damages as per the conditions in the tender schedule. Be that as it is, DoT has not placed any further procurement order for second year after receiving the full consignment supplied by the petitioner pursuant to the purchase order dated 31.1.1996 for the first year. In spite of the same, the petitioner alleges, DoT continuously called upon the petitioner to update the validity period of the bank guarantee and finally issued the impugned communications informing the petitioner, the encashment of bank guarantee if the petitioner fails to pay the amount of Rs.22,65,000.00 (Rupees twenty two lakhs and sixty five thousand only), which are subject of challenge in the writ petition.