RAKESH CHANDANI Vs. M.P. ELECTRICITY BOARD

JUDGEMENT

(1.) IN this writ petition preferred under Article 226 of the Constitution of India, the petitioner has prayed for issue of a writ in the nature of certiorari for quashment of the impugned order contained in Annexure P -8, whereby the order passed in favour of the petitioner accepting his offer has been cancelled, and further to issue a writ in the nature of mandamus commanding the respondents to give contract work in pursuant to the order dated 23 -2 -1999 and sign the agreement. The facts as have been setforth in the writ petition are that the respondent No. 1, M.P. Electricity Board through its Chief Engineer, respondent No. 2, herein, invited tenders for complete erection of 132 KV DCBS, Handiya -Harda Line involving check -survey Sub -setting Tower erection, stringing etc. vide NIS dated 5 -5 -1997. The petitioner along with four others participated in the said bid submitting their tenders. The petitioner quoted the lowest rate and his tender was accepted by the Chief Engineer. Parties entered into the negotiation and the lowest negotiated offer was accepted by the respondent No. 2. After due consideration and by telegram dated 5 -2 -1999 in terms of Clause 3.27 of section -Ill of Commercial Terms and Conditions of tender, document was sent to the petitioner. The acceptance of the document was followed by order No. 04 -06/EE -C/668 dated 23 -2 -1999. As alleged, the contract was concluded on 5 -2 -1999 and on 23 -2 -1999 a telegram and its confirmation copy of the order was received by the petitioner. As stipulated in Clause 4.01 of the work order the petitioner was required to execute the agreement with the Board in its office within 10 days of the award of the contract on non -judicial stamp paper of worth Rs. 50/ -. The aforesaid telegram was received by the petitioner on 23 -2 -1999. He started the execution of the work and also incurred expenses as he was required to complete the work within four months. The petitioner purchased the necessary paper on 3 -3 -1999 at Bhopal and got the agreement typed on 6 -3 -1999. He sent his representation with the balance amount of initial security deposit to be deposited with the Senior Accounts Officer (CBU), MPEB, Jabalpur and met the respondent No. 2 on 18 -3 -1999 with the typed copy of the agreement for its execution in terms of the Clause IV of the work order dated 23 -2 -1999. At that juncture, the petitioner was intimated that a telegram had been issued to him keeping the contract in abeyance. He came to learn that when the petitioner accepted the further reply from the Board, he received the letter dated 24 -9 -1999 issued by the respondent No. 2 indicating that the work order has been cancelled as the petitioner had failed to complete the contractual formalities within the stipulated period of 10 days by furnishing security of Rs. 61,435/ - and by executing the agreement within the said period on the non -judicial stamp paper.

(2.) ACCORDING to the petitioner the work order was issued on 23 -2 -1999 and was received by him on 27 -2 -1999, and if the period is computed the 10 days would be completed on 9 -3 -1999. But the respondent No. 2 passed the impugned order in an arbitrary manner before expiry of the period. It is alleged that the respondents have invited fresh tender vide order No. 04 -06 -EE -C/3343 dated 25 -9 -1999 for complete erection of 132 DCDS Handiya -Harda Line of 18 kilometers. It is putforth in the writ petition that the cancellation of the tender and recalling of the tender amounts to colourable exercise of power and the Board, is not justified in its action. It is highlighted that when the petitioner was granted 10 days time to complete the formalities, the Board could not have cancelled the tender before expiry of the stipulated period. A return has been filed by the answering respondents contending, inter alia, that a detailed order to complete the erection was issued vide order dated 23 -2 -1999 at the contract value of Rs. 55,71,749.17 as per Clause IV of the work order, the petitioner was required to complete the contractual formalities by furnishing 2 per cent security i.e. Rs. 81,435/within 10 days from the date of award of contract. It is setforth as the petitioner failed to complete the contractual formalities for furnishing of security deposit and entering into the contract within a stipulated period of 10 days, there has been breach of terms and conditions of the contract resulting in its cancellation. It is also putforth in the counter/affidavit that fresh tenders have been called vide tender to notice No. 3343 dated 25 -9 -1999 and the specification has been changed. It is also highlighted that the petitioner was well aware regarding deposit of security amount which he came to know on receipt of the telegram dated 5 -2 -1999. He was required to execute the agreement with the Board on non -judicial stamp paper within 10 days from the date of the award of the contract and was required to deposit the security amount within 10 days from 23 -2 -1999 but as he did not do so, there was no option but to cancel the contract. Investment of the money by the petitioner has been seriously disputed. There has been denial that the petitioner had sent his representation with the balance amount of initial security deposit to be deposited with the Senior Accounts Officer on 18 -3 -1999. It is categorically stated that as the petitioner failed to complete the contractual formalities within the specified period of 10 days respondent kept the contract in abeyance and informed the same to the petitioner by telegram dated 8 -3 -1999. In paragraph 10 of the counter affidavit, it has been clarified that stand of the petitioner that 10 days time would be computed from 27 -2 -1999 and the same would expire on 9 -3 -1999, is not correct as the award of contract was made on 22 -3 -1999 and the time expired within 5 -3 -1999 and contract was cancelled on 8 -3 -1999. Making such averments, the Board has justified its action.

(3.) THE core question that falls for consideration is whether the Board has been justified in cancelling the work order passed in favour of the petitioner on the ground that the petitioner has not complied with his part of obligation. On a perusal of the Annexure P -1, it transpires that the petitioner's offer was accepted and he was asked to mobilise his resources to start the work immediately after completing contractual formalities. It was mentioned in the said telegram "the detailed order follows" as per Annexure P/2, which is a correspondence between the parties'. Paragraph 4 which pertains to contract agreement and security deposit. It reads as under: Contract Agreement and Security Deposit: