2015 Supreme(Mad) 1370
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
B. RAJENDRAN, J.
Saisudhir Infrastructures Ltd, JV with Koya & Co. & Others - Petitioners
Versus
The Managing Director, Tamil Nadu Water Supply and Drainage Board & Others - Respondents
W.P(MD).Nos. 18823 of 2014, W.P(MD).Nos. 18824 of 2014 & 20318 to 20320 of 2014 & M.P.(MD).Nos. 1 & 2 of 2014
Decided On: 18-03-2015
For the Petitioners:M/s. Ajmal Associates, Advocates.
For the Respondents:M/s. Porkodi Karnan, Advocates.
The court emphasized the importance of contractual obligations and upheld the respondents' right to terminate the contracts due to delay as per the agreement.
Headnote:
Delay in Execution of Contract - Dispute Redressal Committee - Clause 33 and 41 of the Agreement - [Writ Petitions] - [Delay in Execution of Contract] - [Clause 33, Clause 41] - The court discussed the delay in execution of the contract, the role of the Dispute Redressal Committee, and the provisions of Clause 33 and 41 of the Agreement. The court emphasized that the calling of a fresh tender was within the domain of the respondents and dismissed the Writ Petitions.
Fact of the Case:
The petitioners challenged the action of the respondents in going for a fresh tender for completion of the balance work, citing delay in execution of the contract. The respondents terminated the contracts due to delay and called for fresh tenders.
Finding of the Court:
The court found that the delay in execution of the contracts led to their termination by the respondents, who were within their rights as per the agreement. The court dismissed the Writ Petitions, emphasizing that the calling of a fresh tender was within the domain of the respondents.
Issues: The core issue involved whether the respondents should dispose of the appeal preferred by the petitioner firm before calling for a fresh tender.
Ratio Decidendi: The court held that the respondents were within their rights to terminate the contracts due to delay as per the agreement. The court emphasized that the calling of a fresh tender was within the domain of the respondents.
Final Decision: The Writ Petitions were dismissed by the court.
1. Since the facts and circumstances of the case are one the same in all these Writ Petitions, they are all taken up together and decided by a common order.
2. While W.P.(MD).Nos.18823 and 18824 of 2014 has been preferred by M/s.Saisudhir Infrastructures Ltd and W.P.(MD).Nos.20318 to 20320 of 2014 has been preferred by M/s.IVRCL Ltd, Telugana. Both of them are challenging the action of the respondents in going for a fresh tender for completion of the balance work, which according to the respondents, they have failed to do so, within the stipulated period granted to them.
3. According to the M/s. IVRCL Ltd, Telugana, they have been awarded the contract by the respondents and as per the agreement entered by them, they were directed to complete the said contract work within a stipulated period of mentioned in the contract. Before approaching this Court, according to the petitioner firm, they have completed the contract work awarded to them in the following manner:-
| Sl. No. | W.P.(MD).No | % of work done |
| 1. | 20318 of 2014 | 56% |
| 2. | 20319 of 2014 | 33% |
| 3. | 20320 of 2014 | 67% |
They petitioner firm would contend that they could not complete the work for various reasons as stated in paragraph No.6 of the affidavits filed in support of the Writ Petitions. Eventually, they would contend that the delay in execution of the contract awarded by the respondents was not due to them. However, the authorities without considering the said aspect, cancelled the very contract itself. Apart from that, as per the contract, there is a clause for settlement of dispute, namely, the Dispute Redressal Committee. Therefore, they have preferred necessary appeals in respect of the contracts awarded in W.P.(MD).Nos.20318 to 20320 of 2014 before the said Committee.
4. Similarly, in the other two contracts was awarded to M/s. Saisudhir Infrastructures Ltd, who are the petitioners in W.P.(MD).Nos.18823 and 18824 of 2014. The said contract should have been completed by the petitioner firm within a period of 18 months including the operation and maintenance for a period of six months. But, according to the petitioner firm, they have completed the contract work awarded to them in the following manner:-
| Sl.No. | W.P.(MD).No | Percentage of work done |
| 1. | 18823 of 2014 | 6% |
| 2. | 18824 of 2014 | 16% |
Here again, they would contend that they could not complete the work for various reasons as stated in paragraph No.6 of the affidavits filed in support of the Writ Petitions. Eventually, they would contend that the delay in execution of the contract awarded by the respondents was not due to them. However, the authorities without considering the said aspect, terminated the very contract itself on 30.09.2014. As per the contract, here also, they have preferred necessary appeals in respect of both Writ Petitions before the said Committee on 08.10.2014.
5. According to the petitioner firms, pending appeals, the respondents have called for a fresh publication calling for fresh tenders to complete the balance of work done by them. If the tenders are called for and the technical bids are opened, the petitioner firm would be put to lot of prejudice and the third party interest will come into play. Further, their legal rights to complete the remaining works would be lost. The Dispute Redressal Committee is the competent authority to look into the matter to which they have already made necessary applications. Once the said appeals are pending, the subsequent action of the respondents in going for a paper publication is not sustainable in the eye of law. Therefore, they have challenged the impugned orders with a specific prayer in each of their Writ Petitions to dispose of the appeals at the first instance.
6. The second respondent has filed a detailed counter affidavits and vacate stay petitions. The respondents in W.P.(MD).Nos.20318