RADHEY SHYAM PANDEY Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioner seeks a direction on the North Eastern Railway to withdraw a letter of termination dtd. 31/3/2021 issued by the Senior Divisional Commercial Manager, being the respondent no. 4 herein. By the said impugned communication, the petitioner's security deposit of Rs.23,02,661.00 was forfeited and the petitioner was restrained from taking part in the tender of the North Eastern Railway for the next two years. The impugned letter referred to Scenario-3 of a letter dtd. 3/12/2020 which provides for termination of the contract between the Railways and the Leaseholder (petitioner).

(2.) The petitioner emerged as the successful bidder for a tender for lease of 23 tonnes parcel space and a Lease Agreement was executed between the petitioner and the Railways for a period from 17/1/2020 to 16/1/2025. The operation of the trains was suspended by the Railways by reason of the Covid-19 pandemic. The petitioner thereafter declined to accept the offer of the Railways for a substitute train for limited operation. The petitioner invoked clause 23.1 of the Lease Agreement by a letter dtd. 6/2/2021 with 60 days prior notice and the Railways issued the impugned communication of 31/3/2021 under clause 23.2 of the Lease Agreement and terminated the contract.

(3.) According to learned counsel appearing for the petitioner, the petitioner's right to terminate the contract emanates from clause 23.1 of the Lease Agreement and the Railway Board Circular dtd. 3/12/2020 (Scenario-2 of the Circular). The petitioner sought refund of the security deposit under the said clause. The Railways however, without taking into account the petitioner's invocation, issued the impugned communication by applying Scenario-3 of the Circular and forfeited the security deposit of the petitioner. Counsel submits that the petitioner was blacklisted for two years without there being any provision for such under the relevant Agreement. It is submitted that the Lease Agreement pertained to a specific train i.e. Train No.13020/13019. It is also submitted that the petitioner is entitled to freight adjustment in the event of suspension of service and that the Railways are under a statutory obligation for guaranteed supply of Lease Space. Counsel submits that the petitioner has a right to approach the Writ Court and that the alternative remedy in the form of recourse to arbitration would not apply in the present case.