JUDGMENT By the Court.—The Superintending Engineer, Ban Sagar Nahar Nigam Mandal- I, Mirzapur-respondent No. 3 published an advertisement inviting tenders for construction of certain works within his jurisdiction. The petitioner is stated to have submitted a tender in response thereto along with earnest money of 12,00,000/- (Twelve Lacs) in form of fixed deposit receipt in favour of respondent No. 3. The tender so submitted by the petitioner was found to be lowest and was therefore accepted. Accordingly, vide letter dated 3.10.1997 petitioner was informed to deposit the necessary security money within fifteen days as well as to execute the necessary deed in respect of the contract so settled in his favour. 2. On receipt of the said letter, the petitioner vide his letter dated 14.10.1997 forwarded a reply stating therein that the terms and conditions as were earlier notified along with the tender document have since been altered qua grant of advance to the extent of 5% of the total contract money, because of such change of condition, the petitioner insisted that there should be a corresponding increase in the total bid money by 19% and it is only then that the petitioner would be able to perform his part to the contract. 3. The respondent authorities, however, refused to accept the condition of increase of the bid money by 19% vide letter dated 20th October, 1997 informing the petitioner that since he has not deposited the security money and has not complied with the conditions mentioned in the tender document, he may show cause as to why earnest money of Rs. 12,00,000/- (Twelve Lacs) be not forfeited. 4. The petitioner by means of his letter dated 24.10.1997 again reiterated his demand of increase of the contract money by 19% and in alternative for release of the earnest money. 5. It appears that therefore a fresh notice was published by the Superintending Engineer in respect of the same works and the contract was settled with another contractor for a sum of Rs. 4,54,00,000/- (Four Crores and Fifty Four Lacs) and odds. 6. At this stage of the proceedings, the petitioner filed a writ petition before this Court, being Writ Petition No. 11672 of 1999, claiming refund of the earnest money, which was deposited by him along with his tender. 4,54,00,000/- (Four Crores and Fifty Four Lacs) and odds. 6. At this stage of the proceedings, the petitioner filed a writ petition before this Court, being Writ Petition No. 11672 of 1999, claiming refund of the earnest money, which was deposited by him along with his tender. The writ petition was disposed of vide order dated 23.3.1999 with liberty to the petitioner to file a representation and the said representation was directed to be decided by the authority concerned with the time specified in the order. 7. In compliance of the order of the Hon’ble High Court, the Superintending Engineer vide his order dated 6th May, 1999 informed the petitioner that due to non-fulfilment of the terms and conditions of the tender document, because of non-deposit of the security money and non-execution of the agreement by the petitioner, the earnest money deposited by him has been forfeited. It is against this order of the Superintending Engineer that the present writ petition has been filed. 8. Challenging the aforesaid order of the Superintending Engineer, on behalf of the petitioner it has been vehemently contended that the terms and conditions of the contract were unilaterally altered by the respondents after accepting the offer made by the petitioner and therefore in such circumstances the petitioner was not inclined to execute the contract nor the respondents were justified in forfeiting the earnest money . It is submitted that in the facts of the case the offer earlier made lost all its efficacy because of change in condition of the contract qua grant of 5% advance money. Because of the changed conditions the letter of the respondent authority dated 3.10.1997 was rendered a counter proposal which the petitioner had a right to refuse. In support of his contention reliance has been placed upon the judgment of the Hon’ble Supreme Court in the case of U.P. Rajkiya Nirman Nigam Ltd. v. Indure Pvt. Ltd. and others, (1996)2 SCC 667 . 9. A counter affidavit has been filed on behalf of the State respondents and in paragraph 5 it has been stated that in the tender receipt it was specifically pointed out that the contract was to be governed by the conditions of contract as set out in the tender document subject to modification accepted by the Government of Uttar Pradesh. 9. A counter affidavit has been filed on behalf of the State respondents and in paragraph 5 it has been stated that in the tender receipt it was specifically pointed out that the contract was to be governed by the conditions of contract as set out in the tender document subject to modification accepted by the Government of Uttar Pradesh. Even otherwise it is submitted that the change in the condition pertaining to payment of advance up to the maximum of 10% of the contract money only on furnishing of bank guarantee for the like amount cannot be said to be a material alteration in the terms of the contract so as to permit the petitioner to wriggle out the offer made by him and therefore in the facts and circumstances of the case forfeiture of the earnest money was strictly in accordance with the terms and conditions of the tender notice and legally justified. 10. We have heard counsel for the parties and have gone through the records. 11. From the records as they stand before us, the controversy raised in the writ petition is confined to the issue as to whether alteration in the clause providing for payment of advance up to the maximum of 10% of the contract money for purchase of plant and machinery has been so materially altered subsequent to the acceptance of the offer made by the writ petitioner so as to entitle him to withdraw from the same and as to whether the letter dated 3.10.1997 would amount to a counter proposal which could be refused acceptance and therefore the forfeiture of the earnest money deposited along with his earlier offer by the petitioner is legally justified or not. 12. It is not in dispute that the Hon’ble Supreme Court in the case of U.P. Rajkiya Nirman Nigam Ltd. (supra) has specifically laid down that if material changes are made in the conditions of the contract subsequent to the offer made by the bidder, then such material changes would result in a counter proposal which may or may not be accepted by the bidder in his own wisdom. Change of material conditions unilaterally will result in a fresh proposal and the offer in terms of the earlier notice inviting tenders will stand diluted. Change of material conditions unilaterally will result in a fresh proposal and the offer in terms of the earlier notice inviting tenders will stand diluted. Reference may also be had to the judgment of the Hon’ble Supreme Court in the case of M/s. Build India Construction System v. U.O.I., JT 2002 (4) SC 599, wherein it has been held that the terms of the contract between the parties could not be varied except by mutual agreement. 13. In view of the aforesaid judgment, the Court has to examine as to whether there has been substantial/material change in the terms and conditions of the contract unilaterally by the State respondents so as to justify the refusal by the writ petitioner/withdraw from the offer earlier made by the petitioner, in the facts of this case. In case the answer to the aforesaid question is in affirmative, the respondents would not be justified in forfeiting the security money inasmuch as at no point of time the writ petitioner has communicated his acceptance to carry out the contract on the unilaterally changed terms and conditions. 14. However, the Court has to keep in mind that the conditions, which have been altered, must answer the definition of material changes so as to affect the terms of the offer made earlier substantially. It is in this background that we shall examine the relevant clauses of the terms and conditions of the contract, which were applicable qua advance for purchase of plant and machinery as well as the amendment, which has been made in the said clause subsequent to the offer being made by the writ petitioner. 15. It may be recorded at the outset that the tender was for construction of certain works under the Respondent No. 3. The bidders like the petitioner were required to offer their bids for construction of such works. On other conditions being satisfied lowest offerer was to be awarded the contract. In the special conditions of the contract a provision was made for an advance up to the maximum of 10% of the contract money being made by the State to the contractor on his asking for purchase of plant and machinery. This advance was to be repaid along with interest of at least 14% thereon as per the conditions applicable. 16. This advance was to be repaid along with interest of at least 14% thereon as per the conditions applicable. 16. The original clause of advances under the special terms of the contract, which formed part of the tender document, has been enclosed as Annexure-3 to the writ petition and reads as follows : “ADVANCES An advance for plant and machinery required for work and brought to site by contractor shall be given if requested by the contractor. The maximum of such advance shall be ten percent of the contract amount. In case of new plant and equipment the advance shall be limited to ninety percent of the price of such new plant and equipment paid by the contractor for which the contractor shall produce satisfactory evidence. In the case of used plant or equipment, the amount of such advance shall be limited to ninety percent of the depreciated value of plant and equipment as may be determined in accordance with schedule prescribed by Central Water Commission. This advance shall be further subject to the condition that such plant and machinery... The above advances shall bear a simple interest at rate of 14 percent per annum. However, if completion is delayed by circumstances beyond control of contractor for which an extension has been granted by Government the interest charges on such advances shall be waived for the period of extension.” 17. The aforesaid clause is stated to have been altered by the respondents subsequent to the offer made by the petitioner. The amended clause pertaining to the advances, enclosed as Annexure RA-2, reads as follows : “SPECIAL CONDITIONS OF CONTRACT 1.00 ADVANCES’ An advance for plant and machinery required for work and brought to site by the contractor shall be given if requested by the contractor. The maximum of such advance shall be ten per cent of the contract amount. In case of new plant and equipment the advance shall be limited to ninety per cent of the price of such new plant and equipment paid by the Contractor for which the Contractor shall produce satisfactory evidence. In the case of used plant of equipment, the amount of such advance shall be limited to ninety per cent of the depreciated value of plant and equipment as may be determined in accordance with schedule prescribed by Central Water Commission. In the case of used plant of equipment, the amount of such advance shall be limited to ninety per cent of the depreciated value of plant and equipment as may be determined in accordance with schedule prescribed by Central Water Commission. This advance shall be further subject to the condition that such plant and equipment are 1 (a) considered by the Engineer-in-Charge to be necessary for the works, (b) In working order and (c) hypothecated to the Government in the form at Annexure B. Bank guarantee should be or the amount equal to the amount of advance plus the simple interest at the rate of 14% per annum of the advance amount plus the sum equal to 10 per cent of the advance amount. The above advance shall bear a simple interest at the rate of 14 per cent per annum. However, if completion is delay by circumstances beyond control of Contractor for which an extension has been granted by Government the interest charge on such advances shall be waived for the period of extension.” 18. Therefore the only change which had been brought upon in the clause pertaining to the grant of advance to the maximum of 10% of the contract amount is that for the advance asked for the contractor had been made responsible for executing a bank guarantee for the like amount. No other change in condition of the contract has been noticed nor has been brought to the knowledge of the Court by the petitioner. With reference to the said changed clause, wherein the petitioner has been asked to furnish a bank guarantee for the amount for which he seeks advance money for purchase of plant and machinery, (subject up to the maximum of the 10% of the contract money), it is claimed that there has been material change in the terms and conditions of the contract unilaterally by the State authorities and therefore the petitioner was justified in withdrawing from the offer earlier made. 19. It may be noticed that the total bid offered by the petitioner was to the tune of Rs. 3,34,00,000/- (Three Crore and Thirty Four Lacs). The 10% whereof would work out to Rs. 33,00,000/- (Thirty Three Lacs) and odds. 20. 19. It may be noticed that the total bid offered by the petitioner was to the tune of Rs. 3,34,00,000/- (Three Crore and Thirty Four Lacs). The 10% whereof would work out to Rs. 33,00,000/- (Thirty Three Lacs) and odds. 20. The petitioner on receipt of the notice, subsequent to the acceptance of bid made by him, vide his letter dated 14.10.1997, instead of objecting to the condition of furnishing a bank guarantee for the advance up to 10% of the contract amount, in fact prayed for increase of the contract money by 19% i.e. 19% of the total bid money. This increase in the bid amount, subsequent to its acceptance, was not approved of by the Superintending Engineer and despite notice the petitioner did not perform his part of the contract resulting in forfeiture of the earnest money. It is worthwhile to reproduce the relevant portion of the letter of the petitioner dated 14.10.1997, which reads as follows : • egksn;] fuosnu ds lkFk vuqjks/k djuk gS fd d`i;k vius i=kad la[;k 4302@ch0,l0lh0lh0,e0@Vh0 3 fejtkiqj fnukad 3-10-1997 dk voyksdu djus dh d`ik djsaA mijksDr i= ds lkFk vfxze Hkqxrku lEcU/kh krksZa dh dqN izfr;ka Hkh miyC/k djk;h x;h gSaA tks iwoZ esa fn;s x;s fufonk ds krksZa ls fHkUu gSaA vki }kjk fufonk dh krksZ esa fHkUurk ykus ds dkj.k ls esjs dk;Z iz.kkyh esa vusd dfBukb;ksa dk lkeuk djuk iMsxkA ,slh nkk esa mijksDr lakksf/kr krksZ ds jgrs orZeku nj ij dk;Z djus esa vleFkZ gw¡A vr% iwoZ esa esjs }kjk fn;s x;s nj ls 19% ¼mUuhl izfrkr½ vfrfjDr nj c<+kus dh d`ik djsa] rkfd ge vuqcU/k djkdj dk;Z izkjEHk dj ldsaA 21. We are of the considered opinion that there was an attempt on the part of the petitioner to somehow or the other get the bid money increased taking shelter behind the clause providing for furnishing of bank guarantee for obtaining advance up to the maximum of 10% of total contracted amount for purchase of plant and machinery. 22. We may record that providing of advance to the extent of 10% of the total bid amount on a condition that the applicant shall furnish a bank guarantee cannot be said to be such material change in the terms of the contract in the facts of this case so as to treat the revised condition as a counter proposal which could be refused by the petitioner. Change in special condition, noticed herein above, was not in respect of any of the conditions of the basic contract of construction either in design or material to be used or location etc. so as to entitle the petitioner to wriggle out of the offer made by him in terms of the tender notice, which was accepted by the Superintending Engineer as per his letter dated 3rd October, 1997. 23. A bare reading of the aforesaid special condition would establish that it was at the option of the writ petitioner to ask for the advance up to the maximum of 10% and there was no binding obligation upon him to seek such advance for the purposes of execution of the contract. 24. In our opinion if the petitioner was not interested in furnishing bank guarantee, he should have easily avoided obtaining advance for purchasing plant and machinery. Moreover, the advance was to carry an interest of 14% per annum and therefore it was not a gratuitous payment of money by the State respondent for plant and machinery so as to be an addition in the total amount of bid offered. 25. In such circumstances it cannot be said that the change, which was effected in the special condition qua grant of advance up to the maximum of 10%, was a material change in the terms of the contract, for which the offer was made by the petitioner which was accepted, so as to enable him to wriggle out the offer made. 26. In view of the aforesaid, we are of the considered opinion that there was no justifiable cause for the petitioner to refuse the deposit of the security money and for refusal to execute the contract subsequent to the acceptance of the offer under letter dated 3rd October, 1997. Because of the deliberate act of the petitioner in not furnishing the security money and not executing the contract deed the Superintending Engineer has rightly forfeited the security money deposited by the petitioner in terms of the tender notice and such order of the Superintending Engineer cannot be faulted with so as to warrant any interference under Article 226 of the Constitution of India. 27. Writ petition is accordingly dismissed. • ———