IMPORTANT POINT
The court upheld the termination of a consultancy contract due to the appellant's failure to perform obligations, affirming the right to invoke arbitration for grievances.

JUDGMENT :

N. Unni Krishnan Nair. J.

Heard Mr. K. N. Choudhury, learned Senior Counsel assisted by Mr. Rajive R.Raj, learned counsel and Mr. N. Gautam, learned counsel appearing on behalf of the appellant. Also heard Mr. K. Deka, learned counsel appearing on behalf of Ms. R. Devi, learned CGC representing the respondent no. 1 and Mr. P. J. Saikia, learned Senior Counsel along with Ms. R. Bora, learned Standing Counsel, NHIDCL representing the respondent nos. 2 & 3.

2. The appellant, by way of instituting the present intra-court appeal has presented a challenge to an order dated 23.07.2024, passed by the learned Single Judge in WP(C) No. 3368/2024, dismissing the same and thereby rejecting the prayer of the appellant for an interference with a Termination Order dated 24.04.2024, issued by the respondent no. 3 herein, terminating the contract entered into with the appellant and its Joint Venture partner for providing “ Consultancy Services for authorities Engineer for Supervision of Widening/Improvement of 4(four) Lane with Paved Shoulder from Km 95+400 to Km 113+330 of near Ganpat Gaur Gaon to Kwaram Taro Village Section (Package 5) of NH-29 in the State of Assam under Bharatmala Pariyojana on EPC Mode”

3. In pursuance to a Request For Proposal (RFP) dated 19.04.2021, issued by the National Highways & Infrastructure Development Corporation Limited (herein after referred as NHIDCL), for providing “ Consultancy Services for authorities Engineer for Supervision of Widening/Improvement of 4(four) Lane with Paved Shoulder from Km 95+400 to Km 113+330 of near Ganpat Gaur Gaon to Kwaram Taro Village Section (Package 5) of NH-29 in the State of Assam under Bharatmala Pariyojana on EPC Mode”. The appellant along with M/s Armenge Engg. and Management Consultant Pvt. Ltd, as a Joint Venture entity submitted its bid. The bid as submitted by the appellant and its Joint Venture partner being found to be the most suitable, came to be awarded the contract by the respondent no. 2 vide issuance of a Letter of Acceptance (LOA) dated 04.08.2021. On execution of the Contract Agreement, the respondent no. 2 vide communication dated 25.10.2021, issued the notice to proceed with the work.

4. On account of certain deficiencies identified by the respondent no. 2, the appellant and its Joint Venture partner was issued with a notice for suspension of services dated 18.02.2022. The appellant and its Joint Venture partner were required to cure the defects, failing which, it was contended that measures would be initiated for termination of the services, in terms of the provisions of the Consultancy Service Agreement. The appellant, submitted a reply against the notice for suspension dated 18.02.2022, on 28.02.2022. The respondent no. 2, not being satisfied with the reply so submitted by the appellant, proceeded to issue a show-cause notice dated 19.10.2023, requiring the appellant to remedy the failures and on failure, it was contended that the contract in question shall be terminated. The appellant, admittedly, did not submit any response to the show-cause notice dated 19.10.2023 and accordingly, on completion of the period so mandated, the respondent no. 3 proceeded to issue communication dated 24.04.2024, terminating the contract by invoking the provisions of Clause 2.9.1 of the General Conditions of Contract (GCC) of the Contract Agreement. The said communication dated 24.04.2024, issued towards terminating the contract entered into with the appellant and its Joint Venture partner, by the respondent no. 2, was followed by a Debarment Notice dated 13.05.2024; by which, in terms of the provisions of the Contract, the Joint Venture of the appellant and its partner, came to be debarred from participating in future projects of NHIDCL either directly or indirectly for a period of 2(two) years, in accordance with the provisions of Clause 2.9.7 of the GCC as incorporated in the Contract Agreement.

5. The appellant being aggrieved by the Deb