JUDGMENT

MANMEET PRITAM SINGH ARORA, J:

1. The instant writ petition has been preferred assailing the order dated 06.04.2023 (‘Impugned Order’) passed by the Executive Director (T) of Respondent No. 1 i.e., National Highways and Infrastructure Development Corporation Ltd. (hereinafter ‘NHIDCL’) declaring the Petitioner as a ‘Non-Performer’ and consequently, barring it for a period of one (1) year from participating in future bids to be undertaken by Respondent No.1, NHIDCL, and all centrally sponsored road projects,in terms of the circular bearing file no. RW/NH-33044/76/2021-S&R (P&B) and dated 07.10.2021, issued by the Ministry of Road Transport and Highways (‘MoRTH’).

2. Concededly, the punitive action of debarring the Petitioner was taken on the ground that the Petitioner has breached the terms of the contract for supervision consultancy services (‘the contract’) executed with Respondent No.1, NHIDCL. The Petitioner, however, disputes this allegation. It is the Petitioner’s case that the action of debarment is arbitrary, unreasonable and disproportionate to the allegations made against it.

3. Brief facts leading to filing of present petition are as under:

3.1. The Petitioner is a consultancy firm and is engaged in the business of providing independent engineering and supervision services for infrastructure development. The Petitioner firm was established in the year 2007 and is stated to have been associated in about 100 highway projects of the Respondent Authorities, wherein the Petitioner has provided consultation services of professional engineering.

3.2. The Respondent No.1, NHIDCL, is responsible for construction of various highways across the north-eastern region of India.The Respondent No.1, as a matter of practice, appoints consultancy firms such as Petitioner for supervision of construction work carried out by the contractors at site.

3.3. The Respondent No.2, is MoRTH. The Respondent No. 1, in addition to National Highway Authority of India (‘NHAI’) and PWD,is on executing agencies of Respondent No.2. MoRTH has issued the policy circular dated 07.10.2021, which has been relied upon by Respondent No.1, NHIDCL for issuing the impugned order.

4. The Respondent No.1, NHIDCL,issued a notice on 09.05.2018 inviting tender with respect to consultancy services for Authority’s Engineer (hereafter ‘AE’) for supervision of theconstruction and upgradation of NH-7 to 2-Lane with paved shoulder from Km. 368.000 to Km. 468.000 of Lameri to Paini under ChardhamPariyojana, which is being undertaken by third-party contractors on Engineering, Procurement and Construction (hereafter ‘EPC’) basis in the State of Uttarakhand, so as to enhance the traffic capacity and safety for efficient transportation of goods as well as passenger traffic in the Himalayan region (‘the Project’).

The Project is considered to beof significant importance by the Respondents from the perspective of national security.

4.1. The Respondent No.1 intended to appoint an AE to oversee the activities of the EPC Contractors during the entire period of the Project and in furtherance thereto,entered into the contract with the Petitioner on 18.12.2018, for supervision consultancy services. As per clause 2.3 of Special Conditions of the contract, the AE is provided with 30 days to commence contractual work.

It is stated in the petition that the Petitioner commenced the contractual work within three (3) days of execution of contract i.e., on 21.12.2018.

4.2. As per the contract, the Petitioner was required to provide key personnel, sub-professional staff and support staff. The man-months of each staff member was specified and the respective rates of reimbursement were also mentioned therein. In addition, the Petitioner was also entitled to reimbursement of costs of rental and fixed costs towards transportation.

4.3. The Project was divided into five (5) packages, with each package referring to the construction and upgradation of a stretch of total length of the road (i.e., 100 Kms)