MOOL CHAND GARG,J.

1. This appeal arises out of the order dated 16.12.2006 passed by the ld. ADJ, Delhi, whereby the ld. ADJ allowed the objections filed by the respondent to the award dated 28.01.2005 and directed the respondent to return a sum of `11,10,000/- to the appellant being the bid guarantee amount encashed by the respondent on the plea, that the appellant/contractor failed to perform the terms of the contract as awarded to them on 19.12.2001 by not submitting the performance guarantee within 15 days since 19.12.2001.

2. It is the case of the appellant/contractor that in terms of clause 16.1 of the tender documents, the appellant submitted a bid guarantee of `11,10,000/-, valid for a period of 30 days beyond the validity of the bid. As per clause 16.2, the bid security was required to protect the Employer against the risk of Bidder’s which would warrant the guarantee forfeiture. The Bid Guarantee was made payable to employer without any condition whatsoever.

3. As per the original offer submitted by the appellants, they were to complete the work within a period of 15 months. However, during negotiations the respondent impressed upon them to complete the work within 12 months. However, this condition was not acceptable to the appellant and, therefore, vide their letter dated 13.12.2001 they informed the respondent that they would require at least 15 months to complete the work as it was not possible for them to complete it within 12 months. This was in accordance with the original stipulation in their tender. No response was received from the respondent to the aforesaid communication till the contract was awarded to the appellant on 19.12.2001 which mentioned 12 months as a period for completion of work.

4. In these circumstances, the appellant/contractor again requested the respondent to amend the period of supply as 15 months instead of 12 months. This request was finally conceded by the respondents when they issued letter dated 04.01.2002, which is reproduced hereunder:-

“M/s. Office Equipment F28 Hauz Khas Enclave, New Delhi 110 016 Kind Attn: Mr. SPS Oberoi, Managng Partner Sub: Interior and other Allied works for proposed Office Complex Sector 29, Gurgaon. Dear Sir, This has reference to you letter dated 13.12.2001 and 01.01.2002 in regard to the letter of Award No. C-12204-C902-3/I OA 571 dated 19.12.2001 issued to you for the subject package. We have examined your request and agree for a completion schedule of 15 months as provided in the bidding documents instead of 12 months period agreed by you earlier. All other terms and conditions as referred to in your above said Letter of Award shall remain unaltered.

Accordingly the completion schedule as indicated in the above said Letter of Award may be treated as 15 months instead of 12 months and the work against the subject LOA be carried out strictly in time with the provisions of the Bidding document. You are requested to acknowledge the receipt of Letter of Award issued to you on 19.12.2001 by signing on each page of the duplicate copy of the LOA and commence the work without further delay on your part. Thanking you. Yours faithfully Chief Manager (C.S.-NR-I)”

5. The appellants have not disputed that in terms of the original award dated 19.12.2001, the period of supply was 12 months but it is their case, that in view of the clarification given by the respondent, the said award will have to be read in conjunction with the letter dated 04.01.2002. Thus, the period for submitting a performance guarantee by the appellant/contractor started on 04.01.2002.

6. Important developments took place thereafter, inasmuch as, one of the tenderor, namely, M/s. Woodfun who had also submitted his bid document along with appellant/contractor for the same tender but whose bid was rejected, filed writ petition in this Court registered as WP(C) No.7919/2001 challenging the award of the contract to the appellant/appellant/contractor. During the course of hearing of that writ