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2015 Supreme(Jhk) 348
IN THE HIGH COURT OF JHARKHAND AT RANCHI
SHREE CHANDRASHEKHAR, J.
Atri Construction, Sahabganj through its Proprietor Shivmuni Yadav - Petitioner
Versus
State of Jharkhand & Ors. - Respondents
W. P. (C) No. 6983 of 2012
Decided On : 26.03.2015
Advocate Appeared:
For the Petitioner:Mr. Vishal Kumar Tiwary, Mr. Atul Kumar, Advocate
For Respondent-State: Mr. Rajesh Kumar, G.P.V Mr. Anil Kumar, J.C. to A.G.
For Respondent No. 5:Mr. Rajiv Ranjan Tiwary, Advocate Mr. Prashant Kr. Singh, Advocate
Time is the essence of the contract, and the court's interference in matters of award of tenders is limited to compelling reasons and public interest.
Headnote:
Cancellation of Work Allotment - E-Tender Process - [Tender Process] - [P.W.D. Code, 2012, Section 5(1)(a); Tender Document, Clause 3.2; Tender Document, Clause 4.1] - The court discussed the authority to cancel or allot the tender, the requirement to execute the agreement within the scheduled time, and the forfeiture of earnest money. The court emphasized the importance of time as the essence of the contract and the limited scope of judicial review in matters of award of tenders. The decision to cancel the work allotment and award the work to another party was upheld based on the failure to execute the agreement within the specified time and the absence of public interest in the petitioner's challenge.
Fact of the Case:
The petitioner participated in an e-Tender process and was initially awarded the work, but failed to execute the agreement within the scheduled time. Subsequently, the work allotment was cancelled, and it was awarded to another party. The petitioner approached the court seeking direction for executing the agreement.
Finding of the Court:
The court found that the petitioner failed to execute the agreement within the scheduled time, and the decision to cancel the work allotment and award it to another party was upheld. The court emphasized the importance of time as the essence of the contract and limited scope of judicial review in matters of award of tenders.
Issues: Failure to execute agreement within scheduled time, authority to cancel or allot the tender, forfeiture of earnest money, and the scope of judicial review in matters of award of tenders.
Ratio Decidendi: The essence of the contract is time-bound, and failure to execute the agreement within the specified time can lead to cancellation of work allotment. The court's interference in matters of award of tenders is limited to compelling reasons and public interest.
Final Decision: The writ petition was dismissed, and the decision to cancel the work allotment and award it to another party was upheld based on the failure to execute the agreement within the specified time and the absence of public interest in the petitioner's challenge.
Aggrieved by order dated 01.11.2012 whereby, the allotment of work was cancelled and seeking a direction upon the respondents for executing the agreement in favour of the petitioner, the present writ petition has been filed.
2. The facts disclosed in the writ petition are that, pursuant to e-Tender notice dated 18.08.2012, two bidders participated in the tender process. The technical bid was opened on 05.09.2012 and vide letter dated 05.10.2012, the petitioner was informed by the Chief Engineer, Rural Development Special Division, Sahebganj that the work has been awarded to it. Letters dated 10.10.2012 and 15.10.2012 were issued for executing the agreement and the petitioner was directed to execute work on or before 18.10.2012 however, on 17.10.2012, after inspecting the work place, the petitioner informed the respondents about water-logging at the work place. The site was inspected by the Assistant Engineer and the Junior Engineer and they gave a report to the Executive Engineer and, the petitioner submitted its response on 26.10.2012 however, vide order contained in letter dated 01.11.2012, the work order dated 05.10.2012 was cancelled. It is stated that letter dated 01.11.2012 was forwarded to the Chief Engineer and the Chief Engineer vide order dated 06.11.2012 extended the time for executing the agreement by 10.11.2012 and the petitioner accordingly, deposited the security deposit on 07.11.2012 however, in the meantime, the work was alloted to the respondent no.5 on 07.11.2012 itself. The petitioner unaware of the allotment of work to the respondent no.5, requested the Executive Engineer vide letters dated 09.11.2012 and 10.11.2012 for executing the agreement. However, the agreement was not executed by the respondents with the petitioner-M/s Atri Construction. Aggrieved, the petitioner has approached this Court.
3. A counter-affidavit has been filed on behalf of the respondent-Rural Works Department stating that as per the e-Tender notice, 2 bidders namely, M/s Atri Construction and one M/s Tiwari Construction submitted their bids and both quoted the same price, i.e., 10% below the scheduled rate. In view of letter dated 18.09.2012, the Chief Engineer is vested with power both to cancel or allot the tender. The work order was issued to the petitioner on 05.10.2012, in view of its seniority in registration and it was required to execute agreement within 21 days however, it failed to execute the agreement by 01.11.2012. Vide letter dated 10.10.2012, the petitioner was directed to deposit the balance security money within 3 days however, the same was not deposited by the petitioner and a reminder was issued to the petitioner on 18.10.2012. It is stated that neither the agreement was executed nor the security money was deposited and the petitioner in turn, wrote letter to the respondent-Executive Engineer stating that the worksite is not fit for work and it would execute the agreement only after the site would be fit for commencing the work. In the counter-affidavit filed on behalf of the respondent-State of Jharkhand, it is stated that for constructing the district combined agricultural office building at Sahebganj, vide letter dated 03.01.2012, administrative approval for the said construction for Rs.1,52,75,500/was accorded and an amount of Rs.40 lacs was allocated in the first phase. The said amount of Rs.40 lacs was transferred in the treasury account vide order dated 30.03.2012. It is further stated that vide letter dated 14.05.2012, the Executive Engineer, Rural Development Special Division was designated as the Executing Agency for construction of District Combined Agricultural Office building at Sahebganj and he was directed to complete the work.
4. Heard learned counsel for the parties and perused the documents on record.
5. Mr. V.K. Tiwary, the learned counsel appearing for the petitioner challenging the authority of the Deputy Commissioner to cancel the work allotment in favour of the petitioner by the Chie
