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2019 Supreme(Pat) 1767
IN THE HIGH COURT OF JUDICATURE AT PATNA
RAJEEV RANJAN PRASAD, J.
ILF Consulting Engineers Almondz Global Infra Consultant Ltd. - Petitioner
Versus
M/s Bhagalpur Smart City Ltd. - Respondent
Civil Writ Jurisdiction Case No.7654 of 2019
Decided On : 15-07-2019
For the Petitioners: Mr. Y.V. Giri, Sr.Adv., Mr.Ashish Giri, Adv., Mr. Sumit Kumar Jha, Adv., Mr. Rajat Kumar Tiwary, Adv.
For the Respondents: Mr. Lalit Kishore, AG, Mr. Manish Kumar, Adv., Mr.Kinkar Kumar (SC9), Mr. Yogesh Kumar, Adv.
Headnote:
Arbitration and Conciliation Act, 1996 – Section 9 – Constitution of India – Article 226 – Government Contract – Consulting services – Termination of contract – Encashment of bank guarantee and re-tendering – Demand of refund of advance amount – There is categorical stand of respondents that they have presently served only notice of termination on petitioner but final decision with regard to termination of contract is yet to be taken – Sitting in its writ jurisdiction this Court should not take upon itself jurisdiction to appoint an Arbitrator – Arbitration and Conciliation Act, 1996 under which parties have agreed to go for arbitration is an equally efficacious remedy, a complete code in itself and provides forum where an application for appointment of an Arbitrator may be made if parties fail to appoint an Arbitrator with mutual consent – Constitutional Court must restrain itself when petitioner has an equally efficacious remedy – This Court, while exercising its' extra-ordinary writ jurisdiction must take note of legislative intent manifested in provisions of Arbitration and Conciliation Act, 1996 – This Court is not willing to exercise its' discretion to mould relief as prayed by writ petitioner by appointing a sole Arbitrator – Parties are at liberty to proceed with for settlement of their disputes in terms of arbitration clause under agreement – Petitioner had moved Delhi High Court under Section 9 of Act of 1996 but after that instead of taking recourse to remedy available under Act of 1996 they chose to invoke writ jurisdiction of this Court – Writ jurisdiction would not be correct remedy here – Notice of termination is not to be treated as a final decision of termination of agreement – Petitioner has remedy available to take up all issues before Arbitrator. (Paras 22, 24, 25 and 27)
JUDGMENT :
Petitioner in the present is a Joint Venture Limited Company (hereinafter referred to as the ‘JV’) of ILF Consulting Engineers and Almondz Global Infra Consultants Ltd. ILF Consulting Engineer is the lead partner. Petitioner has moved this Court invoking its writ jurisdiction for the following reliefs:-
“i) To issue a writ/order/direction in the nature of certiorari for quashing the letter bearing no.142/BSCL dated 27.03.2019 issued under the signature of the Managing Director/CEO, Bhagalpur Smarty City Ltd. by which pursuant to the decision taken in the meeting of the Board of Directors held on 11.03.2019 notice of termination of the contract agreement dated 02.08.2017 has been issued in relation to planning, designing, managing, implementing and monitoring area based development projects and PAN city projects for BSCL including scope for services, team arrangement and deliverable under the smart city project pursuant to Clause 2.9.1(f) of the agreement. (Annexure-13)
(ii) To direct the authorities to produce the decision taken in the meeting of the Board of Directors of Bhagalpur Smarty City Ltd. held on 11.03.2019 wherein the petitioner has been held to have failed to fulfill the duties and objectives in terms of contract agreement dated 02.08.2017 and quash the same.
(iii) To hold and declare that the impugned notice of termination dated 27.03.2019 is wholly illegal in violation of rule of natural justice and also without jurisdiction.
(iv) To issue interim/ex-parte interim order/direction preventing the authorities from taking any further coercive steps against the petitioner including actions of debarring/blacklisting etc. & refund the bank guarantee that has been forfeited.
(v) To any other relief or reliefs for which the petitioner is found to be entitled in the facts and circumstances of the case.”
2. By filing an Interlocutory Application (I.A.) No.1 of 2019 the petitioner has sought to amend the writ application in the light of the developments which took place during the pendency of the writ application. In the amendment application, the following reliefs have been prayed:-
“1(vi) To issue writ/order/direction in the nature of certiorari for quashing the letter no.161 dated 19.04.2019 issued under the signature of the Managing Director cum CEO, Bhagalpur Smart City Ltd. by which the petitioner has been directed to refund an amount of Rs.60 lac paid as advance allegedly on ground of non-performance in terms of the contract agreement.
(vii) To issue writ/order/direction in the nature of certiorari for quashing the letter no.171 dated 24.04.2019 issued under the signature of the Managing Director cum CEO, Bhagalpur Smart City Ltd. by which the petitioner has been imposed with the penalty of Rs.1.125 crore pursuant to clause 7.3.2 of the contract agreement on ground of nonperformance of the work as per the agreement to be paid before 24.05.2019 failing which actions of recovery will be imitated.
(viii) To pass interim order staying the operation of letter no.161 dated 19.04.2019 and letter no.171 dated 24.04.2019 during the pendency of the writ application and further, preventing the respondent from taking any coercive action pursuant to the said letters.”
3. Again by placing a supplementary affidavit, the petitioner has brought to the notice of this Court the fresh notice inviting tender published on the website of the respondent no.1 whereby the respondent no.1 has invited Request for Proposal (RFP) for selection of Project Management Consultant (PMC) to Design, Develop, Manage and Implement Smart City Projects under the Smart City Mission.
4. A perusal of the writ application would show that for the purpose of implementing the Smart City Project of Bhagalpur City, the Government of Bihar and the Union Government incorporated a body corporate namely “Bhagalpur Smart City Ltd.” (hereinafter referred to as the ‘BSCL’) as a special purpose vehicle (SPV) (respondent no.1). The ‘BSCL’ floated an expression of interest for
