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2017 DIGILAW 1314 (ORI)

Amulya Kumar Panda v. Bank of Baroda, Rep. through its Managing Director, Vadodara

2017-11-15

BISWANATH RATH

body2017
JUDGMENT : BISWANATH RATH, J. 1. This Civil Misc. Petition involves challenge to the order dated 13.7.2017 passed by the learned District Judge, Khurda at Bhubaneswar in F.A.O. No. 136/2016, vide Annexure-5 affirming the order dated 15.9.2016 passed by the Senior Civil Judge, Bhubaneswar in I.A. No. 1/2016 corresponding to C.S. No. 1175/2016 appearing at Annexure-3. 2. Short background involving the case is, petitioner as plaintiff filed Civil Suit No. 1175/2016 as against the Bank of Baroda and its Officers involving a security contract. Petitioner as Proprietor runs a Security Agency in the name and style, M/s. Amulya Kumar Panda Security Agency registered with the Director General Re-settlement, Government of India functioning under the Ministry of Defence, New Delhi, which usually sponsors such Security Agencies to provide security to Public Sector Undertakings. Opposite parties wanted security for their branches and on their request to the Director General Re-settlement, it sponsored the name of the plaintiff Agency for security purpose. As a consequence, the parties entered into agreement on 26.3.2014 for supply of security personnel to their Banks for the period from 1.4.2014 to 31.3.2016 for a period of two years. The plaint discloses that as per Clause-19 of Office Memorandum dated 9.7.2012 of the Director General Re-settlement, all sponsorships will be done in clinic order of seniority of registration for a period of two years extendable by further two years at a time and the sponsorship will be done by the duly constituted Board of Officers in accordance with the guidelines. Plaintiff claimed to have performed the assignment satisfactorily. There was no adverse report against it. It is submitted that though the contract was for two years and with provision for extension for another two years on expiry of terms but before much expiry of the term, there was extension of the period of contract by another one year communicated, vide letter dated 31.3.2017 on the same terms and conditions and the period of extension was from 1.4.2016 to 31.3.2017 with further condition that if the plaintiff gets another sponsorship then the contract shall be terminated by giving three months prior notice. Plaintiff made a complain and requested for extension of the contract for two years and also to take out the unilateral condition imposed while extending the contract for one year. In the meantime, the defendant no. Plaintiff made a complain and requested for extension of the contract for two years and also to take out the unilateral condition imposed while extending the contract for one year. In the meantime, the defendant no. 3 by his letter dated 4.5.2016 intimated the plaintiff that the defendants have received fresh sponsorship from the Director General Re-settlement including the plaintiff and thus requested it to participate in the fresh tender process while requesting to continue with the security system up to May, 2016 or till a new Agency is selected. Being aggrieved by the letter dated 4.5.2016, the plaintiff was constrained to file the suit with the following prayer:- “Under the facts and circumstances stated above this learned Court may be graciously pleased to pass the following decree/decree in favour of the plaintiff: (i) Let it declared that the letter dated 4.5.2016 issued by the Defendant No. 3 to the plaintiff is illegal and arbitrary and, as such, void. (ii) Let it be declared that the condition imposed in Clause-2 of the letter dated 29.3.2016 of the Defendant No. 3 to the plaintiff is illegal and arbitrary and the same is void. (iii) Let it be declared that the plaintiff is entitled to continue in the contract of supply of security personnel and allied services to the defendants as per the renewal letter of contract dated 29.3.2016 till 31.3.2017 and thereafter for another one year, i.e. till 31.3.2018. (iv) Let the cost of the suit be decreed in favour of the plaintiff. (v) Let any other decree/decrees be passed, to which the plaintiff is entitled to under law and equity. (vi) Let the defendants be restrained from terminating the supply of security services by the plaintiff to the defendants till expiry of the contract.” Along with the plaint, the plaintiff also filed an Interim Application registered as I.A. No. 1/2016 under Order 39 Rules 1 and 2 read with Section 151 of C.P.C. praying for ad-interim injunction restraining the defendant-O.Ps. from terminating the supply of security services during pendency of the suit. The defendant-O.Ps. filed objection seriously disputing the allegations made by the petitioner and further brining in that fact that the Director General Re-settlement, Government of India framed a scheme registering the Security Agency consisting of retired defence personnel so also system for sponsoring the registered agency to six Public Sector Undertakings for providing necessary security at their end. The defendant-O.Ps. filed objection seriously disputing the allegations made by the petitioner and further brining in that fact that the Director General Re-settlement, Government of India framed a scheme registering the Security Agency consisting of retired defence personnel so also system for sponsoring the registered agency to six Public Sector Undertakings for providing necessary security at their end. The defendants also admitted that in the process, the Director General Re-settlement sponsored the name of the present petitioner to the defendants for providing security personnel in their Branches. Further in the process, an agreement was also entered into between the parties for providing security in the defendants’ Establishment from 1.4.2014 to 31.3.2016 with condition of renewable for a further period of one year at the discretion of the Bank. Satisfying their case in the matter of extension for one year, the defendants took shelter of the conditions contained in the agreement. It is claimed that as the term of contract was nearing closure, defendant no. 3 issued a letter to Director General Re-settlement requesting for sponsorship of fresh names with a further rider that in case it is not possible to give fresh sponsorship to give necessary extension to the petitioner- Agency. The petitioner also requested in the time to extend the contract for two years with effect from 1.4.2016 to 31.3.2018. Considering the request of both parties, the Director General Resettlement was pleased to extend the contract of the petitioner for a period of one more year with same terms and conditions. It is contended that the plaintiff was clearly informed that in the event of fresh sponsorship, the plaintiff-petitioner’s contract will be terminated by giving three months prior notice. It is further revealed, the plaintiff- petitioner was intimated by defendant no. 3, the O.P. No. 3 to participate in the fresh tendering process, which is sub-judice in the main suit. Taking shelter of Clause-20 of the agreement dated 26.3.2014, the defendants contended that they had right to terminate the contract by serving thirty days notice. It is also contended that there was no violation of any term of the contract and the petitioner’s suit aimed only with intention to hang on with the contract. 3. Taking shelter of Clause-20 of the agreement dated 26.3.2014, the defendants contended that they had right to terminate the contract by serving thirty days notice. It is also contended that there was no violation of any term of the contract and the petitioner’s suit aimed only with intention to hang on with the contract. 3. Hearing the rival contentions of the parties, the trial court proceeded to examine the ingredients involved in the grant of injunction and in the process, the trial court considering the submissions of both the parties observed, “prima facie does not appear that the Director General Re-settlement has given any guideline for tendering process for selection of the Agency. So the request of the O.Ps. to the petitioner to take part in the tendering process for selection of the Agency and to provide service up to May 2016 or till the new Agency is created does not appear to be in conformity with the guidelines and scheme of the Director General Re-settlement and thus found, the petitioner has a prima facie case on the question regarding the letters dated 29.3.2016 and 4.5.2016 issued by the defendants”. Moving to decide the question regarding balance of convenience, the trial court held, balance of convenience leans in favour of the petitioner. On the issue of irreparable loss, taking into consideration some decisions, the trial court observed that in the event the petitioner succeeds in the suit, the loss sustained can be repudiated by way of appropriate damage and accordingly dismissed the Interim Application. 4. Being aggrieved by the order of the trial court involving I.A. No. 1/2016, the plaintiff- petitioner filed F.A.O. No. 136/2016. The lower appellate court entering into the contest of the parties and upon considering the rival contentions further taking into consideration the expiry of extended period was over by 26.3.2017 held that the petitioner has raised a substantial question accepting that there may be a case of irreparable loss, which can be compensated by appropriate compensation and thus confirmed the order of the trial court thereby dismissing the F.A.O. by judgment dated 13.7.2017 at Annexure-5 resulting filing of the present Civil Misc. Petition. 5. Petition. 5. Assailing the impugned orders passed by both the courts below, Sri G. Mishra, learned counsel for the petitioner referring to the observations of the courts below regarding confirming the finding on the question of prima facie case and balance of convenience contended that the courts below have decided the matter in high per technical manner and for the clear observations by both the courts regarding prima facie case and balance of convenience in favour of the petitioner, both the courts erred in not granting injunction in favour of the petitioner and thus prayed this Court for interfering with the impugned orders and setting aside the same thereby further granting an order of injunction in favour of the petitioner. 6. Sri D.B. Padhi, learned counsel for the O.P.-defendants taking this Court to the documents relied on by the plaintiff in the matter of extension of the contract by further one year by virtue of letter of the Director General Re-settlement as well as the defendant no. 3 ultimately reflected through the letter dated 29.3.2016 clearly indicating the period of extension with effect from 1.4.2016 to 31.3.2017 contended that even assuming that the petitioner had a prima facie case and balance of convenience but the period of extension having been expired since 31.3.2017, no injunction can be granted in favour of the petitioner at this moment and hence prayed for rejection of this Civil Misc. Petition. 7. Considering the rival contentions of the parties and on perusal of the respective pleadings, this Court finds, there is admission by the petitioner in the plaint that the last extension granted in favour of the petitioner was pursuant to the communication dated 29.3.2016, vide document no. 5 extending the contract period of the petitioner for one year with effect from 1.4.2016 to 31.3.2017. This Civil Misc. Petition was filed on 16.7.2017 praying for grant of injunction permitting the petitioner to continue with the contract beyond 31.3.2017, which has no existence as on date, may be the suit between the parties is pending to adjudicate as to validity of the letter dated 4.5.2016 issuing a notice of termination of the contract and further declaring the condition imposed in Clause-2 of the letter dated 29.3.2016 issued by the defendant no. 3 for being illegal and arbitrary. 3 for being illegal and arbitrary. Fate of the plaintiff will be dependent only on adjudication of the above issues and for the expiry of renewal period in the meantime, this Court finds, there is no scope for grant of injunction in favour of the petitioner at this moment. 8. During course of argument, it is fairly submitted that after expiry of the period of contract involving the petitioner, there has been fresh agreement involving some other Security Agency and such Agency has also started operating in the meantime leaving no scope for grant of injunction at this juncture. 9. Thus while dismissing the Civil Misc. Petition for having no scope to interfere with the impugned orders, this Court only makes an observation that trial of the suit involving the parties will be expedited and disposed of as expeditiously as possible preferably within a period of nine months. No cost.