Govind Singh Deshmukh vs State Of Chhattisgarh

Heard Mr. Prafull N. Bharat, learned senior counsel, assisted by Mr. Akash Pandey and Mr. Tanmay Thomas, learned counsel, appearing for the petitioner. Also heard Mr. Vikram Sharma, learned Deputy Government Advocate, appearing for the respondents No. 1 to 3 and 5 as well as Mr. Sharad Mishra, learned counsel, appearing for the respondent No. 4.

The petitioner is a B Class contractor. Pursuant to a notice inviting tender (for short, the NIT) No. 82/Tech/RC-4/CGRRDA/2017, dated 30.11.2017, the petitioner was awarded the work for construction and maintenance of rural roads under the Pradhanmantri Gram Sadak Yojna for District Sukma, Package No. CG-19-20 (L042-L040 KM 4.00 to Gufadi) from Sukma Dantewada National Highway (KM 26) to village Marooki Nirgundipara, and an agreement to that effect was executed between the petitioner and the respondent No.3 on 23.02.2018. In the work order, it was stated that the period for completion of the work would be 24 months, excluding the rainy season. For the work in question, the petitioner had deposited a bank guarantee (for short, the BG) of Rs. 14,70,000/-. On 25.08.2018, the contract was terminated on the ground that the work was not started. However, on an application filed by the petitioner for renewal of the agreement, the same was renewed as in the fresh tender process, no other tenderer had participated. It is the further case of the petitioner that even after the request made by the petitioner from time to time for grant of police protection as the area is naxal affected, no adequate security was given to him for the entire stretch. The petitioner had also made a prayer for extension of time for completion of the work, but without considering the same, the contract came to be terminated on 08.08.2022 in terms of Clause 52.1 and 52.2 of the NIT. The petitioner made a representation on 19.09.2022 to the Executive Engineer to cancel the order of termination of the contract and to provide extra time for completion of the remaining work. While the same is pending, steps have been taken for invoking the BG submitted by the petitioner and recovery proceeding has also been initiated for recovery of the penalty amount. It is in the background of the factual events, this petition came to be filed before this Court.

It is submitted by Mr. Bharat that though not stated in the representation submitted before the respondent No. 3 on 19.09.2022, the same is a representation in terms of Clause 24 of the NIT. It is submitted by him that during the period when the same is pending consideration, if the BG is allowed to be encashed, the petitioner will suffer grave prejudice. Accordingly, he submits that pending decision on the representation of the petitioner by the respondent No. 3- Executive Engineer, who is the competent authority in terms of Clause 24.1 of the NIT, the respondent authorities may be directed not to encash the BG.

Mr. Vikram Sharma, learned Deputy Advocate General, appearing for the respondents No. 1 to 3 and 5, on a query of the Court, submits that he has got instructions that till today, the representation filed by the petitioner on 19.09.2022 has not been disposed of. It is also submitted by him that the BG has also not been invoked.

The aforesaid submission regarding BG is also endorsed by Mr. Sharda Mishra, learned counsel, appearing for the respondent No. 4.

Clause 24 of the NIT reads as follows:

“24. Dispute Redressal System.

24.1 If any dispute or difference of any kind what-so-ever shall arise in connection with or arising out of this Contract or the execution of Works or maintenance of the Works there under, whether before its commencement or during the progress of Works or after the termination, abandonment or breach of the Contract, it shall, in the first instance, be referred for settlement to the competent authority within 45 days of arising of the dispute or difference, described along with their powers in the Contract Data, above the rank of the Engineer. The competent authority shall, within a period of forty-five days after being requested in writing by the Contractor to do so, convey his decision to the Contractor. Such decision in respect of every matter so referred shall, subject to review as hereinafter provided, be final and binding upon the Contractor. In case the Works is already in progress, the Contractor shall proceed with the execution of the Works, including maintenance thereof, pending receipt of the decision of the competent authority as aforesaid, with all due diligence.

24.2 Either party will have the right of appeal, against the decision of the competent authority, to the Standing Empowered Committee within 90 days of decision of the competent authority if the amount appealed against exceeds 0.20 (zero point two zero) percent of the initial price.

24.3 The composition of the Empowered Standing Committee will be:

I. One Official member, Chairman of the Standing Empowered Committee, not below the rank of Additional Secretary to the State Government;

II. One official member not below the rank of additional chief engineer; and

III. One non-official member who will be technical expert of Chief Engineer’s or Superintending Engineer’s level selected by the Contractor from a panel of three persons given to him by the Employer.

24.4 The Contractor and the Employer will be entitled to present their case in writing duly supported by documents. If so requested, the Standing Empowered Committee may allow one opportunity to the Contractor and the Employer for oral arguments for a specified period. The Empowered Committee shall give its decision within a period of ninety days from the date of appeal, failing which the Contractor can approach the appropriate court for the resolution of the dispute.

24.5 The decision of the Standing Empowered Committee will be binding on the Employer for payment of claims up to five percent of the Initial Contract Price. The Contractor can accept and receive payment after signing as “in full and final settlement of all claims”. If he does not accept the decision, he is not barred from approaching the courts. Similarly, if the Employer does not accept the decision of the Standing Empowered Committee above the limit of five percent of the Initial Contract Price, he will be free to approach the courts applicable under the law.”

A perusal of the above goes to show that there is an in-house mechanism for redressal of grievance.

Having heard learned counsel for the parties and having considered the materials on record, we are of the considered opinion that ends of justice would be sub-served if a direction is issued to the respondents not to encash the BG till such time the representation dated 19.09.2022 filed by the petitioner is decided. Ordered accordingly.

Clause 24.1 of the NIT visualises that the competent authority should communicate the decision within a period of 45 days. In the instant case, the period of 45 days has already expired. Therefore, it is expected that the competent authority will take a call on the representation of the petitioner, as expeditiously as possible.

The writ petition stands disposed of.