The contract was subject to approval by the Competent Authority, and the approval was necessary for the extension of the contract.

JUDGMENT :

VIVEK PURI, J.

1. The matter has been taken up through video conferencing in the light of the Covid-19 pandemic situation and as per instructions.

2. The petitioner has assailed the order dated 8.6.2020 (Annexure P-9) passed by the respondent cancelling the extension of tender awarded in his favour on 3.6.2020.

3. Learned counsel for the petitioner submits that the petitioner was allotted the tender for house keeping and other sourcing services for MCH/CHC/PHC for Dadri District invited by respondent No.3 on 15.6.2019. The petitioner was successful bidder, who was awarded work and an agreement was entered into between the parties. As per the terms of the agreement dated 6.7.2019 (Annexure P-3), the agreement was extendable by another year subject to the performance of satisfactory work. The period of work was to expire in July 2020 and the process for extension was initiated by respondent No.3. The concerned authorities under whom the petitioner had provided about 170 skilled and unskilled persons reported the performance of the petitioner's agency as satisfactory. Accordingly, the contract was extended for further one year vide letter dated 3.6.2020 (Annexure P-8). However, the extension for one year has been arbitrarily and unilaterally cancelled in terms of letter dated 8.6.2020 (Annexure P-9). No reason was assigned while unceremoniously terminating the contract ending on 5.7.2020. Even no opportunity of hearing was afforded to the petitioner.

4. Per contra, learned State counsel submits that in terms of Clause 2.4 of the Detailed Notice Inviting Tender (DNIT) the contract was subject to approval by the Competent Authority. Since the approval was declined by the Competent Authority, the contract was automatically cancelled. In view of the change in the policy of the Government for deployment of Home Guards instead of Security Guards. The change was incorporated. Considering the fact that the Home Guards Security Personnel were better trained in mob control, riot management, vehicular management, human traffic management etc. as compared to the outsourced staff. The Home Guard recruits are better trained to deal untoward incidents, mishappenings in emergent situations. The financial implications are also on lesser side on account of employment of Home Guards was also considered by the Government. Furthermore, the petitioner was expected to start work from 1.7.2020 and the extension was cancelled in terms of letter dated 8.6.2020 in view of the non-approval by the Competent Authority. Even the Clause 9 of DNIT empowers the respondent to cancel the bid at any stage.

5. Heard. There is no controversy between the parties to the effect that at the first instance the petitioner was awarded the work for providing manpower by way of outsourcing for CHC, PHC, MCH from 6.7.2019 to 5.7.2020. As per the terms and conditions of DNIT, the contract was liable to be extended by one year subject to review and satisfactory performance of services/activities.

6. Accordingly, respondent No.3 had issued the letter dated 3.6.2020 extending the contract from 1.7.2020 to 30.6.2021 for a further period of one year. Subsequently, on account of non-approval by the Director, Health Services, the extension was cancelled in terms of the notice dated 8.6.2020 (Annexure P-9). The extension of tender of outsourcing services was cancelled in response to the letter from respondent No.2 i.e. Director, Health Services, Haryana dated 4.6.2020. Clause 2.4 of DNIT reads as follows:

“The work contract shall be awarded initially for a period of one year, subject to review and the satisfactory performance of Services/Activities and compliance of all terms and conditions of the service Agreement, which is further, subject to the approval of Competent Authority. The Contract shall stand automatically cancelled if the Competent Authority declines to grant such approval it will be responsibility of contractor to apply for extension beyond one year at least 3 months b