J.P. SUREKA Vs. COAL INDIA LTD.

JUDGEMENT

(1.) This is an application under Article 226 of the Constitution of India, the Petitioner had challenged an order of black -listing by which all business dealing by and between the Petitioner, M/s. Shankar Engineering and Trading Co., Calcutta, and Central Coalfield Ltd. had been suspended by Inspector -General and Chief Vigilance Officer of Central Coalfield Ltd. by orders dated May 15 and June 4, 1986, as well as filing of a F.I.R. alleging an offence Under Ss. 120B and 420 of the Indian Penal Code against the Petitioner by the Inspector, C.B.I. Ranchi, and an investigation initiated on the basis of the said F.I.R.

(2.) The facts of this case in short is that the Petitioner is carrying on the business in electrical, mechanical and fabrication engineers, having its office at No. 2, Ganesh Chandra Avenue, 5th to 8th Floor, Calcutta, and workshop at 121 J.N. Mukherji Road, Ghusuri, Howrah, in the State of West Bengal. That in pursuance of an advertisement inviting tenders for supply of 4 steel balls of the specification of 80, 60 and 40 m.m. published on May 19, 1984, the Petitioner submitted tender for supply of the said items and that, accordingly, to the general terms and conditions of the tender the Petitioner was required to quote firm prices on F.O.R. destination basis. The said general terms and conditions further stipulated that earnest money of Rs. 2000 is to be deposited along with the offer by demand draft in favour of Central Coalfield Ltd., Ranchi, on State Bank of India, Ranchi Branch. Pursuant to the said notice inviting tender the Petitioner submitted a tender and that the Petitioner's tender was accepted on the basis of his quotation on May 22, 1985, for supply of the said items of forged steel balls as specified in the said tender. The said offer made by the Petitioner on May 22, 1985, was, however, accepted by the Central Coalfield Ltd. and that your Petitioner was informed that such acceptance by the Senior Purchase Officer, Central Coalfield Ltd., Darbhanga House, Ranchi. In view of such acceptance of offer given by the Petitioner under quotation dated May 22, 1985, the Petitioner, however, remained liable for repair or replacement of the articles supplied during the period of one year from the date of supply in case of manufacturing defects. It is stated that for the purpose of effecting supply of forged steel balls the Petitioner got the same done through another firm and that before supply of the same the Petitioner got necessary certificate of analysis from the Industrial Quality Controller, a Government registered Industrial Testing and Analytical Laboratory. As the Central Coalfield Ltd. was in urgent need of supply of forged steel balls, wrote a letter to M/s. Choudhury Carrying Corporation, the transport agent of Central Coalfield Ltd. to take delivery of one truck of balls from the Petitioner under reference No. KTW dated November 1, 1985, the said M/s. Choudhury Carrying Corporation took delivery of 100 packages of forged steel balls from the Petitioner under consignment note dated November 8, 1985, In pursuance of the said letter dated November 1, 1985, pertaining to consigner's challan No. HO/23/85 -56 dated November 8, 1985, and on November 9, 1985, the Petitioner again gave a guarantee certificate in respect of the said manufactured goods and once again guaranteed that in case of any manufacturing defects during the period of one year, the Petitioner would replace the same free of cost, and in respect of the said supply so made by the Petitioner under challan dated November 8, 1985, the Petitioner raised bill against the Project Officer, Central Coalfield Ltd., Kathara, Giridih on November 9, 1985, for a sum of Rs. 87,360. By the said bill it was categorically pointed out that the supply vis -a -vis the payment in regard thereto was subject to Calcutta jurisdiction. Again on October 3, 1985, the Petitioner was asked by the Coal India Ltd. to arrange for immediate supply of the balance quantity of forged steel balls against supply order dated October 11, 1985, under reference No. KTW/Steel Ball/7170 dated December 3, 1985, issued by the Purchase Officer, Central Coalfield Ltd. Kathara Washeries. In reply to the said letter dated December 3, 1985, the Petitioner by the letter dated December 9, 1985, informed the Project Officer, Central Coalfield Ltd., that already one truck load of balls had been dispatched and the balance quantity was under process of manufacturing and would be dispatched as soon as the same could be made ready. Thereafter, on December 16, 1985, the Senior Purchase Officer, Central Coalfield Ltd., by his letter intimated the Petitioner about certain amendments in the order dated October 11, 1985. By the said letter dated December 16, 1985, the amendments to the material specification and mode of dispatch were made. On January 3, 1986. 180 bags of forged steel balls were dispatched to the Purchase Officer, Kathara Washeries of the Central Coalfield Ltd. and also submitted a guarantee certificate dated January 3, 1986, that the Petitioner would replace the articles free of cost in case of any manufacturing defects within the guarantee period of one year from the date of supply on the same date. The Petitioner submitted a bill for Rs. 73,936 to the Project Officer, Central Coalfield Ltd., Kathara Washeries, Giridih, Bihar. In the said bill also it was specifically mentioned that the same was subject to Calcutta jurisdiction. In view of the amendments brought about by the letter dated December 16, 1985, the Petitioner requested the Deputy Materials Manager (P), Central Coalfield Ltd., for extension of delivery period so that no liquidated damages were imposed upon the Petitioner under letter dated January 17, 1986. The Petitioner again by letter dated April 4, 1986, requested the Deputy Materials Manager (P)(VI), Central Coalfield Ltd., for extending the delivery period up to June 15, 1986, without imposing any liquidated damages. The Project Officer by his telegram dated March 26, 1986, asked the Petitioner to effect immediate dispatch of the balance quantity of steel balls against supply order dated October 11, 1985.

(3.) It is the case of the Petitioner that while the Petitioner was persistently asked to effect delivery of forged steel balls by installment, the Petitioner was never informed that the goods already supplied were defective or were not in accordance with the standard tender specification. Again on April 6, 1986, the Project Officer, Kathara Washeries, informed the Petitioner that in view of the urgency one Mr. B.K. Sinha of Kathar a Washeries was being deputed for dispatch of materials through the authorized transporter against supply order dated October 11, 1985. The Petitioner was further requested to extend all help to the said Shri Sinha by the letter dated April 16, 1986. It is stated that the Petitioner came to learn on or about April 7, 1986, by a wireless message issued by the Project Officer, Kathara Washeries, under memo. No. KTW/1660 addressed to the Chief Central Manager (WS), Central Coalfield Ltd. by the said wireless message extension of time as prayed for by the Petitioner, was requested to be given by the concerned Project Officer. By the letter dated April 8, 1986, the Petitioner was, however, informed that the recommendation of the Petitioner for extension of the delivery period was been processed through Central Coalfield Ltd., Purchase Department, for necessary amendment in that regard. On April 20, 1986, the Petitioner was further informed by letter dated KTW/525/3886 by the Project Officer, Kathara Washeries, requested the Petitioner to arrange for further dispatch of forged steel balls to the lorry driver of lorry No. DRY 2394. By the letter dated April 16, 1986, issued by the Assistant Materials Manager (P), Central Coalfield Ltd., the Petitioner was informed that the delivery period of supply order covered by the order dated October 11, 1986, was provisionally extended up to May 30, 1986, and pursuant to the said letter dated April 30, 1986, the Petitioner supplied the balance quantity of forged steel balls under challan No. HO/02/86 -87 dated April 25, 1986, against supply order dated October 11, 1985. On April 26, 1986, the Petitioner also gave a guarantee certificate in respect of supply effected under challan dated April 25, 1986, inter alia, guaranteeing that the case of any manufacturing defects the Petitioner would replace the same within a guarantee period from the date of supply and also submitted a bill for Rs. 61,152. Even though the supply of the forged steel balls were made by installments under the said supply order, at no point of time there has been any objection against the quality and quantity of the article supplied by the Petitioner and that without intimating any reason and/or ground the Petitioner was served with an order by the Deputy Materials Manager (P) dated June 3, 1986, stated that in view of the anomalies in your supplies to Central Coalfield Ltd. your registration is hereby withdrawn and that this was followed up by a circular dated May 15, 1986, under No. Vig./Black List/Shankar Engg. and Trading Co./86(34)/690 wherein it was stated that during an enquiry it has been prima facie revealed that M/s. Shankar Engg. and Trading Co. Calcutta, has supplied sub -standard steel balls for use in one of the Washeries of CCL. While the complete enquiry is in progress. CMD, CCL, has taken a decision to suspend business dealings of CCL with M/s. Shankar Engineering and Trading Co. Calcutta, with immediate effect. General Managers of all areas and project officers of all Washeries are requested to ensure that all business dealings with M/s. Shankar Engineering and Trading Company, Calcutta, are suspended forthwith.