Judicial review in contractual matters is permitted if state actions are arbitrary, but existing arbitration clauses must be respected as alternate dispute resolutions.

JUDGMENT

Manoj Kumar Ohri, J.

1. By way of the present petition filed under Article 226 of the Constitution of India, the petitioners have impugned the termination letter dated 02.11.2022 issued by respondent No.1 (hereinafter, referred to as the `order').

2. Pithily put, the relevant facts are that in the year 2018, the Indian Railway Stations Development Corporation India Ltd. (IRSDC), a joint venture company of Land Development Authority and Ircon ltd., floated an open tender on 15.03.2018 to redevelop the Bijwasan Railway Station on EPC (Engineering, Procurement and Construction) basis. The petitioners participated in the tender and were declared the successful bidder resulting in signing of an Agreement on 02.12.2019. The Agreement was executed by IRSDC. Reportedly, on closure of IRSDC, the Agreement in question was novated in favor of present respondent No.1 vide another Agreement dated 07.01.2022 on the same terms and conditions.

3. Apparently, disputes arose between the parties relating to delay in timely completion of the project. Although extension of time was sought and granted, but eventually the respondent terminated the Agreement vide the impugned order.

4. Mr. Dayan Krishnan, learned Senior Counsel for the petitioners while assailing the impugned order contended that the delay in completion of the project was entirely attributable to respondent No.1 as it defaulted in fulfilling its obligations under Clauses 4.1.6 and 9.4 of the Agreement. It was submitted that in terms of the said clauses, respondent No.1 was under obligation to provide support to the petitioners in procuring applicable permits required from any Government instrumentality for implementation of the project. It included obtaining the applicable permits for felling of trees. To buttress the submission that being the owner/occupant, the obligation was entirely of respondent No.1 learned Senior Counsel referred to Section 8 of the Delhi Preservation of Trees Act, 1994. In this regard, reference was also made to Form B to Sub-Rule (1) of Rule 4 of the Delhi Preservation of Trees Rules, 1994 which require the requisite application seeking permission for felling of trees is to be accompanied by documents including latest Jamabandi of land record issued by the Tehsildar, NOCs from the concerned local body i.e., MCD/N.D.M.C. as well as from the adjoining property owners. Though an application was made but the same was rejected on 11.01.2018 for want of necessary documents. When the petitioners sought the requisite documents from respondent No.1, a meeting was held between the parties and as per the Minutes of Meeting dated 03.08.2022 and 11.08.2022, respondent No.1 undertook to file an application seeking permission for felling/transplantation of 9 trees.

It is submitted that though the concerned authority granted the permission for felling of 9 trees on 13.10.2022 however, the delay in seeking the same also resulted in delaying the entire project. The respondent No.1 was also to process the application for felling of about further 4600 trees. Lastly, it was submitted that though the respondent granted an extension of time for completion of work upto 06.12.2023, the Agreement was terminated pre-maturely. It is thus contended that the impugned order not only suffers from the vice of illegality and arbitrariness, but also being issued for irrelevant cause.

5. Anticipating opposition from the respondents on the aspect of maintainability of a writ petition, learned Senior Counsel for the petitioners placed reliance on the decision of the Supreme Court in Harbanslal Sahnia and Another v. Indian Oil Corpn. Ltd. and Others reported as (2003) 2 SCC 107, Union of India and Others v. Tantia Construction Private Limited reported as (2011) 5 SCC 697, Unitech Limited and Others v. Telangana State Industrial Infrastructure Corporation (TSIIC) and Others reported as 2021 SCC OnLine SC 99 and M.P. Power Management Company Limited, Jabalpur v. Sky Power Southea