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2021 Supreme(MP) 467

IN THE HIGH COURT OF MADHYA PRADESH
Sheel Nagu and Anand Pathak, JJ.
Tulsi Narayan Garg (M/s.) v. The M.P. Rural Road Development Authority
Writ Petition No. 16245 of 2020 (G); Decided on 12.7.2021

Advocates:
D.S. Raghuvanshi for petitioner; Vivek Khedkar for respondents.

Headnote:

Constitution of India -- Art. 226 -- petitioner/contractor given contract for completion of roads -- defect liability period of 5 years also completed -- security deposit not refunded -- writ petition -- petitioner seeking refund of amount of security deposit -- work completed successfully -- utility certificate for maintaining roads for 5 years issued by department -- certain other projects of petitioner incomplete and left in lurch -- amount of Rs. 164.97lacs to be recovered and for that security amount of Rs. 19,37,900/- withheld -- no ground for interference made out -- petitioner is at liberty to avail alternative remedy before Arbitral Tribunal in accordance with law -- writ petition dismissed. Civil Appeals No. 6726-6729 of 2019 decided on 30.8.2019 (SC) distinguished. [Paras 6 to 9

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ORDER

Pathak J;

1. The present petition is preferred under Article 226 of Constitution of India, being crestfallen by action/inaction of the respondents whereby security deposit of petitioner company has not been refunded despite issuing completion certificate as well as utility certificate by the competent authority.

2. It is the submission of learned counsel for the petitioner that petitioner was given a contract for construction of T-05 (Dhoti) to Asida Road, Ashida to Kamarsali Road, L-04 to Dubri and Dubri to Gurunavda. Work was completed and so as the 5 years maintenance period. Since completion certificate was issued on 22.3.2013 and defect liability period of 5 years was also completed successfully which is evident from the report of inspection team issued in this regard by way of utility certificate (Annexure P/3), therefore, petitioner has right to get his performance guarantee to the tune of Rs.19,37,900/- which is required to be refunded under the contract. Since same has not been refunded, therefore, petitioner is before this Court.

3. Learned counsel for the petitioner also placed the order dated 30.8.2019 passed by the apex Court in Civil Appeal No(s).6726-6729 of 2019 (M/s Tulsi Narayan Garg v. The M.P. Road Development Authority) and submitted that the Apex Court has decided the said controversy and still the respondents have not followed it.

4. Per contra, learned counsel for the respondents opposed the prayer and submitted that petitioner has not placed the facts in correct perspective. It is apparently true that subject work was completed within time and completion as well as utility certificates were issued but it is the clause 43.4 which includes any amount arises not only under the subject contract but any other contract which entitles the employer to effect recovery thereof and invoke said clause of General Conditions of Contract Part I, respondents have not settled the amount because the work of petitioner regarding MP3712, MP3717, MP3714 and MTN 5 in spite of all efforts, petitioner could not able to complete the work and on account of aforesaid, termination order was issued and the amount of Rs.164.97 lacs is required to be recovered from the petitioner. For that purpose, appropriate action has been initiated by the department. Therefore, security amount has been withheld. Petitioner has alternative remedy to approach the Arbitral Tribunal and same cannot be adjudicated here. Respondents relied upon the order dated 22.4.2019 passed in Writ Petition No.26373/2018 wherein Division Bench of this Court has clarified the position while considering clause 43 of General Condition of Contract Part I.

5. Heard learned counsel for the parties through video conferencing and perused the record.

6. In the case in hand, petitioner contractor is seeking refund of amount which has been completed successfully by the petitioner and utility certificate for maintaining the roads for 5 years has been issued by the department. It is also true that certain other projects of petitioner are incomplete and were left in lurch, therefore, amount of Rs.164.97 lacs has been sought to be recovered from the petitioner and for that security amount of Rs.19,37,900/- has been withheld. This aspect has been considered by the Division Bench of this Court in Writ Petition No.26373/2018. Relevant discussion is reproduced for ready reference:

“10. The issues which crop up for consideration are as to whether the petitioner is entitled for the refund of amount of performance guarantee. Secondly, whether the respondents are justified in withholding the amount as there exists liability of the petitioner under other contract.

11. True it is that Clause 43 of GCC Part I provides the manner of Security deposit/Retention and release of performance security and security Deposit/Retention Clause 43.4 besides stipulating that the performance security equal to the five percent of the contract price and additional performance security for Routine mainte

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