IN THE HIGH COURT OF JUDICATURE AT PATNA
RAJEEV RANJAN PRASAD, J.
C.W.J.C. No. 5637 of 2020
(6.5.2020)
Bhawana Infrabuild Pvt. Ltd. – Petitioner
vs.
State of Bihar & Ors. – Respondents
Government Contract – Work Contract – Termination of contract and forfeiture of Bank Guarantee – Contract in question contains an arbitration clause, hence, against order terminating contract leading to encashment of bank guarantee, petitioner has got an equally efficacious statutory /contractual, as the case may be, alternative remedy of approaching Arbitral Tribunal for redressal of his grievance – Writ application need not be entertained as regards first prayer seeking interference with order of termination – It is, however, left open for petitioner to approach appropriate forum for redressal of his grievance particularly in terms of arbitration clause – Similarly, once bank guarantee has already been invoked and same has been honoured by Bank, prayer in this regard has become infructuous – Whether encashment of bank guarantee was rightly or wrongly done, primarily it is a matter attached to adjudication of disputes by appropriate forum while considering challenge to order of termination of contract – In case Bank proceeds to auction sale property in question, petitioner will be at liberty to seek his remedy before appropriate forum in accordance with law. (Paras 15, 16 and 18)
ORDER
This writ application has been placed for consideration through Video Conferencing from the residential Chamber by the order of Hon’ble the Chief Justice.
2. Mr. Sanjay Kumar, learned counsel for the petitioner represents the petitioner. Mr. Nadeem Seraj, learned counsel appears on behalf of the State.
3. The Registry has pointed out certain defects in the writ application, however, because of the on-going lockdown in the country, those defects have not been cured. Learned counsel for the petitioner states that in paragraph ‘31’ of the writ application the petitioner has specifically undertaken to deposit the required court fee and file the hard copy of the writ application along with its annexures after affidaviting the same once the Hon’ble High Court starts functioning in regular manner.
4. Learned counsel for the State has informed this Court that although the copy of the writ application has been served upon the office of the learned Advocate General but the annexures of the writ application have not been received, therefore, it has been submitted that learned counsel for the petitioner should also undertake to serve the complete hard copy of the writ application with all annexures after the Hon’ble High Court starts functioning in regular manner.
5. Learned counsel for the petitioner undertakes to do so and comply with all requirements within three weeks after opening of the Hon’ble High Court in regular manner.
6. Learned counsel for the State has informed this Court that Mr. Lalit Kishore, learned Senior Advocate normally represents Patna Smart City Limited (Respondent No. 5). Today, learned counsel for the respondent no. ‘5’ and the UCO Bank (Respondent No. 7) are not participating through video conferencing.
7. Learned counsel for the petitioner has informed that copy of the writ application has already been sent through email to both respondent nos. ‘5’ and ‘7’.
8. Bet that as it may, in view of the urgency pleaded by learned counsel for the petitioner, this Court has taken up the matter for consideration. In this writ application the petitioner is praying for the following reliefs: –
“i. For issuance of an appropriate writ/s, order/s, Direction/s to the respondents for quashing letter No. 2117 dated 08.04.2020 issued by the respondent no. 6 whereby and under the contract awarded to the petitioner on 12.06.2019 for construction of integrated command control centre (ICCC in short) building in SSP office, Patna has been terminated in full and his bank guarantee no. 15571 GTER 000419 dated 26.04.2019 to the tune of Rs. 69,86,465.00 has been forfeited and the concern bank has been directed to remit the said amount.
ii. For issuance of an appropriate writ/s, order/s, Direction/s to the respondents bank not to remit the amount of bank guarantee to the tune of Rs. 69,86,465.00 to the Respondent Managing Director, PSCL pursuant to his letter dated 08.04.2020 till lis is decided.
iii. For issuance of an appropriate writ/s, order/s, Direction/s to the respondents the bank guarantee remitted to the respondent Managing Director, PSCL on 20.04.2020 may not be realized by the bank till lis is pending before this Hon’ble Court because the bank official visited the mortgaged property at Motihari on 21.04.2020 for its assessment and valuation for auction.
iv. To pass such other order/orders as your Lordships may deem fit and proper in the facts and circumstances of this case.”
9. It is the contention of Mr. Sanjay Kumar, learned counsel for the petitioner that the respondent no. ‘5’ has terminated the contract without giving any opportunity to show cause to the petitioner. Learned counsel further submits that during the lockdown period respondent no. ‘5’ has acted unfairly in invoking the bank guarantee of Rs. 69,86,465/- which was furnished by the petitioner towards performance guarantee.
10. Learned counsel has pointed out from the statements made in the writ application that there is a biased role of respondent no. ‘8’ who is sitting as
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