SENBO ENGINEERING LTD. Vs. THE UNION OF INDIA

JUDGEMENT

(1.) The captioned writ application has been filed praying, inter alia, for quashing the contract termination notice issued by respondent no. 2 dated 11.07.2016 and further direction upon the respondent no. 2 to grant extension of time for completion of the contract in relation to Tender No. 99 of 2013 -14.

(2.) Bereft of unnecessary details, the facts as delineated in the writ application, is that the NIT for construction of seven major bridges was floated, in which, the petitioner being the successful bidder was given letter of acceptance dated 03.06.2014 for executing the work, at the total cost of Rs. 82,80,54,283.78, within two years from the date of issuance of letter of acceptance. It is stated that on 31.10.2014 a formal contract agreement was entered into between the petitioner no. 1 and respondent -railways, however, that is backed by the General Conditions of Contract (in short 'GCC') of Railway Authorities. In terms of the letter of acceptance, the petitioners furnished two Performance Bank Guarantee amounting to Rs. 4,14,02,720/ -valid up -to 28.02.2018 and Rs. 4,15,00,000.00 valid up -to 31.08.2017. It is stated the petitioners vide letter dated 15.09.2014 had called upon respondent no. 2 to issue approved drawing for construction of bridges as more than three months had elapsed and delay in issuing the approved drawings would ultimately cause delay in execution of the final project. It has further been averred that the petitioners further issued reminder letters dated 24.09.2014 and 25.11.2014 for issuing approved drawing for construction of bridges. It has further been averred that as per terms and conditions of the contract, the petitioners have not been paid the Mobilization Advance, which is 10 % of the contract value, 5 % at the time of signing of the contract and 5 % for mobilization of the site -establishment. However, the petitioners out of their own funds have deployed men, materials, machines etc at the work site and paid Rs. 24,82,77,769/ - towards them. It has further been averred that in course of execution of work, the petitioners have faced many difficulties such as on 07.11.2014 about 70 % of the boundary of the laboratory wall was destructed by miscreants, excavation work was prevented by the local villagers, for which, the petitioners sought necessary co -operation from local police as well as from respondent -railway. It has further been averred that the petitioners from time to time requested the respondents - authorities to resolve the major causes for hindrances of work in site such as land acquisition problems, local bandhs etc but no heed was given by the respondents -authorities. However, finally after lapse of 20 months from the date of issuance of letter of acceptance, the petitioners received the approved drawing of the 7 major bridges on 13.02.2016. It is submitted that due to non - cooperation on the part of the respondent -railways and due to the railways not acting strictly in terms of their obligations, the petitioners were prevented from completing the work within the time frame, the petitioners vide letter dated 23.05.2016, requested the respondents -railways for extension of time for completion of 7 major bridges by invoking Clause 17 (A) (ii) and 17A(iii) of the GCC and requested to extend the contract upto 02.12.2017 on the same terms and conditions. It has been submitted that since the middle of the year 2014 till June 2016, there was no response from the respondents -authorities nor any attempt was made by the respondents -authorities to controvert or deal with the contentions put forth by the petitioners. However, a communication dated 01.06.2016 was issued by the respondents - Railway proposing a meeting to be held on 16.06.2016 to discuss the issues relating to progress of the work, which ultimately led to issuance of letter dated 11.07.2016 by respondent no. 2, which is a purported contract termination notice for terminating the contract of Tender No. 99, which is impugned in this writ application.

(3.) Heard Mr. Indrajit Sinha, learned counsel for the petitioner and Mr. Gautam Rakesh, learned counsel for the respondent - Railway.