ESSAL ÇÔ RRE ENTERPRISES (JV) Vs. COAL INDIA LIMITED

JUDGEMENT

(1.) The petitioner has challenged an order of banning and termination dtd. 2/12/2022 issued by Eastern Coalfields Limited (ECL). The reason for banning is the petitioner's poor performance and continuous failure to improve its performance despite several letters issued by ECL. The impugned letter gives detailed particulars of the reminders sent to the petitioner and the petitioner's failure to rectify the situation. The letter also refers to a show-cause notice issued to the petitioner and a personal hearing given on 7/9/2022. The impugned letter also refers to Chapter 6, Sec. 12 - Guidelines for Banning of Business and clause no. 2(v)(b) in relation thereto.

(2.) Learned counsel appearing for the petitioner submits that the petitioner faced several allegedly insurmountable difficulties in executing the project including non-availability of land which resulted in the delay. Counsel blames the ECL for not providing sufficient land within a reasonable time frame. Counsel submits that 21.47 acres of land was given to the petitioner on 22/7/2022 after which a fresh Target was given for August, 2022. Counsel complains that ECL terminated the contract on 19/8/2022 before the petitioner could meet the target. Counsel submits that the termination letter of 19/8/2022 was issued without giving the petitioner an opportunity of hearing and further that the contract was terminated under clause 10(a) and (b) of the General Terms and Conditions (GTC) of the e- tender notice dtd. 21/12/2015. Counsel submits that the said clause only speaks of cancellation of contract and not of termination. Counsel further submits that the petitioner has been banned for 3 years instead of 1 as provided under the Guidelines for Banning of Business. Counsel further submits that the impugned letter does not disclose any subjective satisfaction as to the reason for banning and is hence arbitrary and bad in law.

(3.) Learned counsel appearing for the respondent ECL seeks vacating of an order passed by this Court on 22/12/2022 which records the stand taken by learned counsel appearing for the ECL that ECL shall not take any steps to the prejudice of the petitioner till 9/1/2023. Counsel submits that ECL continues to face prejudice by reason of the aforesaid order and points to numerous failures on the part of the petitioner to perform and complete the work. Counsel submits that the contract was terminated on 19/8/2022 and the petitioner has not challenged the same till date. It is further submitted that the petitioner was given several opportunities to rectify its conduct in terms of performance and was also given a show-cause notice and a personal hearing before the contract was terminated. Counsel urges that there were several allegations against the petitioner including the removal of coals to unspecified destination, driving on unauthorised routes and driving in protected areas which were admitted on behalf of the petitioner by way of hand written endorsements appearing from the Minutes of a meeting held on 7/9/2022. The extract of the Minutes is placed before the Court.