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2014 Supreme(Jhk) 890

IN THE HIGH COURT OF JHARKHAND AT RANCHI
SHREE CHANDRASHEKHAR, J.
Chanani Transport, Ramgarh – Petitioner
Versus
M/s. Central Coalfields Limited, Ranchi & Ors. - Respondents
W.P. (C) No. 6098 of 2013
Decided On: 09/09/2014

Advocates:
Advocate Appeared:
For the Petitioner:Mr. Sanjeev Sahay, Advocate
For the CCL :Mr. A.K. Das, Advocate

Headnote:Government Contract—Termination—Imposition of penalty—Parties to contract are bound by terms and conditions of contract—Petitioner cannot be deprived of its right over amount sought to be withheld without following legal procedure—Demand letter set aside.

Order

Initially, the writ petition was filed seeking a direction upon the Respondent no.2 to consider the grievances raised in letter dated 04.09.2013 of the petitioner and to refer the matter to External Independent Monitor for monitoring the execution of the contract in terms of Integrity Pact appended to the General Terms and Conditions governing the Transporting and Loading contract. Subsequently, the contract awarded to the petitioner was terminated on 16.10.2013 and therefore, the petitioner moved I.A. No. 7997 of 2013 seeking permission to amend the writ petition for incorporating a prayer challenging the termination of contract dated 16.10.2013. After the termination of the contract, orders dated 15.01.2014 and 02/03.06.2014 were passed whereby security deposit furnished by the petitioner in relation to other contracts were sought to be appropriated/ withheld and therefore, orders dated 15.01.2014 and 02/03.06.2014 were also sought to be challenged by filing I.A. Nos. 685 and 3001 of 2014. Vide order dated 30.07.2014, the amendments sought by the petitioner were allowed and the petitioner was permitted to file amended writ petition incorporating challenges to orders dated 16.10.2013, 15.01.2014 and 02/03.06.2014.

2. The petitioner, a partnership firm submitted its tender in pursuance of tender enquiry dated 23.11.2009 for the work of hiring of HEMM for removal of Over Burden from query of Section 1 of Rajrapa Open Cast Project with average load of 1.02 km and execution, loading and transportion of WIII grade coal from Rajrapa Open Cast Project to Rajrapa Washery load distance of 34 km. The petitioner was declared a successful bidder and it was awarded the work by work-order dated 21.06.2010 for a period of eight years for a total value of Rs.14181.48 lacs. The General Terms and Conditions governing the contract of Transporting and Loading contained “Integrity Pact” which provided appointment of an External Independent Monitor for monitoring the tender process and the execution of the contract. For execution of work alloted to it, the petitioner needed more than 10,000 Ltrs of HSD everyday however, in view of letter dated 17.01.2013 issued by the Ministry of Petroleum and Natural Gas, Government of India, the Indian Oil Corporation issued letter dated 08.03.2013 and stopped HSD supply to bulk consumers. This seriously affected the execution of work by the petitioner. The petitioner made representation to respondent no.1, the Chairman-cum-Managing Director for supply of diesel at the stipulated rate of Rs.33.69 paise for Rajrapa Project and at the rate of Rs.39.66 paise for Hesagarha Project. The respondent no.3 vide letter dated 11.04.2013 intimated the petitioner that the respondent-CCL is ready to supply HSD at the rate of Rs. 69.21 paise per Ltr however, compensation for price variation was fixed at Rs. 50.33 per Ltr from 16.02.2013. In terms of Clause 37.0 of the STC, the petitioner was entitled for escalation at the rate of Rs. 69.21 Ltr and therefore, vide letter dated 15.04.2013, the petitioner sought confirmation of the provision for escalation however, vide letter dated 17.04.2013 the respondent no.3 directed the petitioner to resume work for removal of Over Burden, failing which the contract would be terminated and damages would be recovered from the petitioner besides, invoking the bank guarantee. Challenging the letter dated 11.04.2013, the petitioner approached this Court in W.P.(C) No. 2920 of 2013 which was permitted to be withdrawn with liberty to file suit and/or to invoke Arbitration Clause. The petitioner vide letter dated 04.09.2013 requested the respondent no.2 to refer the matter for arbitration to External Independent Monitor and vide letter dated 23.09.2013, the Chairman of Transparency International Limited also requested the respondent no.2 to designate a Monitor to look into the complaint of the petitioner however, vide letter dated 25.09.2013, the respondent no.3 declined to entertain the requ


































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