The court upheld the validity of debarment and encashment of Performance Bank Guarantee due to non-performance by the petitioner under the contract, emphasizing adherence to tender conditions.

JUDGMENT

1. This petition has been filed under Section 9 of the Arbitration and Conciliation Act, 1996 with the following prayers:

"a. Pass an order in favour of petitioner and against the Respondent thereby restraining the respondent from encashing the Performance Bank Guarantee No.027GT02211790014 amounting to Rs.4,50,142 dated 28.06.2021 and;

b. Restrain the respondent no.2 from blacklisting/debarring the petitioner in further tender of the remaining work.

c. Restrain the respondent no.2 in issuance of the fresh tender in respect of the remaining work,

d. Pass an ex-parte interim order in terms of prayers A-C above"

2. Mr. Abhinav Agnihotri, learned counsel for the petitioner, submitted that the petitioner/Company, which is engaged in the business of offering pioneer and advance display technologies in total digital display solutions, had participated in the tender issued by respondent No.1/Central Public Works Department (for short, "CPWD") bearing No.01/EE(e)/IITIPED/2021-22 for the work of supplying, installation, testing and commissioning of Video Wall and other equipments at auditorium at the estimated cost of Rs.3,33,80,966/-. The tender was awarded to the petitioner on 22nd June, 2021. The tender was accepted at the amount of Rs.1,50,04,744/- and the time period for execution was fixed at three months. As mentioned in the petition, the petitioner was required to supply the following:

i) AV over IP Encoder-Decoder (BOQ Item No.3)

ii. 49" 4K Confidence Monitor (BOQ Item No. 4)

iii. Direct LED Video Wall (BOQ Item No. 1)

3. According to the learned counsel for the petitioner, it was the proposal of the petitioner to include the "Make in India" aspect into the tender and it was accepted. Once the tender was accepted, the Performance Bank Guarantee (PBG) of Rs.4,50,142/- was also furnished by the petitioner on 28th June, 2021. Thereafter, according to the learned counsel, the respondents began harassing the petitioner by demanding GST invoices/import bills, which had no relevance to the determination of the "Make in India" content. Further, it was submitted that as per the guidelines, a self certification was sufficient and in case the respondents had any grievance, they had to refer the matter to Standardization Testing and Quality Certification Directorate for verification. According to learned counsel, the respondents had no authority to demand these documents as they had, particularly the GST invoices/import bills.

4. Learned counsel for the petitioner submitted that the petitioner was aggrieved by the attitude of the respondents and had issued a letter on 11th August, 2021, requesting the respondents to invoke arbitration under Clause 25 of the General Conditions of Contract 2020, Construction Works (for short, "GCC") for the settlement of disputes. However, the respondents have not acted thereon so far. On the contrary, the respondents issued the letter dated 16th November, 2021 directing the forfeiture of the PBG and debarring the petitioner from further tendering for this work. At the same time, they had initiated action of calling fresh tenders, which would be finalized after 4th December, 2021. Learned counsel has relied on the judgment of the Supreme Court in Gorkha Security Services v. Govt. (NCT of Delhi) & Ors., (2014) 9 SCC 105, to submit that there could be no blacklisting without a Show-Cause Notice.

5. It may be mentioned here that this matter had been first listed for hearing on 26th N