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2020 Supreme(Mad) 1272
IN THE HIGH COURT OF JUDICATURE AT MADRAS
PUSHPA SATHYANARAYANA, J.
M/s. Nirmal Cabs, Rep. by its Proprietor, Nirmal Nath & Others – Appellant
Versus
The Chief General Manager, In-charge Materials Management Division: Cauvery Asset Oil & Natural Gas Commission Limited, Karaikal & Another – Respondents
W.P. Nos. 16121, 16122 and 16514 of 2020 & W.M.P. Nos. 20108, 20834, 20836, 20838, 20106, 20109, 20487 & 20488 of 2020
Decided On : 09-12-2020
For the Petitioner:Radha Gopalan, N.A. Nissar Ahmed, Advocates
For the Respondent:Sai Srujan for M/s. Giridhar & Sai, Advocates
The court emphasized the importance of transparency in contractual terms and suggested that parties should seek common law remedies for monetary loss.
Headnote:
Pre-closure - Contract Dispute - Clause 8 of the tender document - Summary of Acts and Sections: Clause 8 of the Special Conditions, Article 226 of the Constitution of India, Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015
Fact of the Case:
The writ petitions challenge the pre-closure of contracts for hiring vehicles by the Oil and Natural Gas Corporation Limited (ONGC) due to a pre-closure clause triggered by a previous court order. The petitioners argue that the pre-closure is arbitrary and prejudicial, while ONGC contends that it was necessary to honor the court order and that the petitioners were aware of the pre-closure clause.
Finding of the Court:
The court dismissed the writ petitions, stating that the pre-closure was not arbitrary and that the petitioners were not prejudiced as the terms were transparent. The court suggested that the petitioners could seek common law remedies if they suffered monetary loss.
Issues: The main issues revolved around the validity of the pre-closure of contracts, the impact of a previous court order, and the transparency of the terms and conditions of the contracts.
Ratio Decidendi: The court held that the pre-closure was not arbitrary and that the petitioners were not prejudiced as the terms were transparent. The court also suggested that the petitioners could seek common law remedies if they suffered monetary loss.
Final Decision: The writ petitions were dismissed, and there was no order as to cost. The connected writ miscellaneous petitions were closed.
JUDGMENT :
(Prayer in W.P. No.16121 of 2020: Writ Petition is filed under Article 226 of the Constitution of India praying for a Writ of Certiorari, to call for the records of the respondent in letter No.KKL/MM/V16XC19003/2020 dated 07.10.2020 giving notice for pre-closure of the contract No.9010030651 for hiring 4 Nos of Bolero Camper on 23.11.2020 awarded to the petitioner and to quash the same.
W.P. No.16122 of 2020: Writ Petition is filed under Article 226 of the Constitution of India praying for a Writ of Certiorari, to call for the records of the respondent in letter No.KKL/MM/V16XC19003/2020 dated 07.10.2020 giving notice for pre-closure of the contract No.9010030653 for hiring 17 Nos of Bolero and contract No.9010030654 for hiring 4 Nos of Bolero Camper on 23.11.2020 awarded to the petitioner and to quash the same.
W.P. No.16514 of 2020: Writ Petition is filed under Article 226 of the Constitution of India praying for a Writ of Certiorari, to call for the records of the respondent dated 7.10.2020 and made in KKL/MM/V16XC19003/2020 and to quash the same.)
Common Order
1. These writ petitions are directed against the impugned notification dated 07.10.2020, pre-closing the contracts of the petitioners viz.Contract No.9010030651 for hiring 4 Nos. of Bolero Camper, 9010030653 for hiring 17 Nos of Bolero, Contract No.9010030654 for hiring 4 Nos of Bolero Camper, Contract No.9001030648 for hiring 23 Nos of Mahindra Bolero and Contract No.9001030649 for hiring 4 Nos of Mahindra Camper.
2. The respondent, which is a Oil Corporation (Oil and Natural Gas Corporation Limited) has floated a tender vide No.V16SC17013 dated 06.06.2017 for hiring 133 Nos of light vehicles for providing services of vehicles on hire on regular basis for transportation of its personnel to different work sites for a period of three years for Cauvery Asset, Karaikal.
3. There were six different categories of vehicles, sought to be hired, classified as Group A, B, C, D, E & F. One of the bidders, namely Mr.Ayyappan, who was not successful, had filed a writ petition in W.P. No.31223 of 2017, to declare the contract awarded by the respondent herein with respect to Tender No.V16SC17013, opened on 03.07.2017, as null and void and obtained an order of status quo. The said writ petition came to be dismissed on 13.01.2020. Aggrieved by the same, intra court appeals have been preferred in W.A. Nos.246, 247 and 656 of 2020. The said writ appeals have also been dismissed on 11.09.2020. It had taken almost 1-1/2 years for the litigation to end. While so, the respondent had issued a fresh Notice Inviting Tender on 12.03.2019 vide No.V16XC190003 for hiring 77 Nos of light vehicles for a period of two years under three categories. On 17.06.2019 under various categories separate contracts have been entered into between the petitioners and the respondent, for each group of vehicles.
4. Clause 7 of the tender document prescribes the duration of the contract as two years from the actual date of mobilisation i.e. the date when the vehicle is deployed for ONGC duty. In case the mobilisation period is delayed on account of ONGC, the same will be allowed without LD.
5. Clause ‘8’ of the tender document is on pre-closure of contract, as per which, ONGC reserves their right to pre-close the contract by giving 45 days notice to the contractor. The above said clause ‘8’ has triggered the issue now in question.
6. The case of the petitioners is that though the earlier tender dated 06.06.2017 had called for certain type of vehicles, the very same type of vehicles had been called for in the present tender notice also. The petitioners had the apprehension that the pre-closure clause was introduced in view of the status quo order that was granted in the earlier writ petitions which were pending at that point of time. Therefore, they had asked for a clarification raising a query that “assuming that the court stay is vacated and the petitioners become successful bidders for the present tender how t
