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Madhya Pradesh High Court · body

2017 DIGILAW 272 (MP)

MOHD. ARIF v. M. P. HOUSING AND INFRASTRUCTURE DEVELOPMENT BOARD

2017-02-20

VIVEK RUSIA

body2017
ORDER : Vivek Rusia, J. The petitioner has filed this present writ petition being aggrieved by the order dated 10/07/2015, by which he has been prohibited to participate in the tender proceedings for the period of three years and also dismissal of the appeal vide order dated 29/04/2016 by the Commissioner, M.P. Housing and Infrastructure Development Board. 2. The petitioner is a Class-B contractor registered with the Public Works Department. The respondent/M.P. Housing and Infrastructure Development Board has issued a notice inviting tender (in short "NIT") on 08/09/2014 for carrying out external electrification of I.T Park (Phase-I) Sinhasa, Indore. The petitioner after purchasing the tender, participated in the tender proceedings and quoted the price @ 2.95% below the SOR. Respondent no. 3 accepted tender of the petitioner vide order dated 08/12/2014 and directed him to execute the agreement within 15 days. As per the petitioner, as he was suffering from skin disease "Pemphigus Vulgarise with Diabetes Mellitus and has undergone the treatment at AIIMS hospital, Delhi, therefore, again he could not execute the agreement with the respondent within time. Vide letter dated 22/12/2014, the Board extended seven days' time till 29/12/2014 to execute the agreement. During that period, the petitioner visited HAJ and came back to India on 05/01/2015, therefore, he could not execute the agreement. Vide order dated 29/12/2014, the respondent forfeited the earnest money deposited by the petitioner and sent a show cause notice dated 20/03/2015 as to why his licence be not suspended for the period of three years. The petitioner sent reply on 30/03/2015, which was not found satisfactory, hence by the impugned order, the respondent has suspended the licence and prohibited him to participate in the tender process for the period of three years. Being aggrieved by the said order, the petitioner preferred an appeal, that has also been dismissed, hence the present writ petition before this Court. 3. Notices were issued by this Court vide order dated 13/06/2016 and thereafter, vide order dated 15/12/2016, operation of the orders dated 10/07/2015 and 29/07/2015 was stayed. 4. Reply has been filed by the respondents, in which the respondent/s has justified their action against the petitioner. It is submitted that because of none execution of the agreement and non-performance of the work, the respondent had to invite fresh tender, in which one Shri B.L. Jain submitted higher price @ 1.2 below SOR. 4. Reply has been filed by the respondents, in which the respondent/s has justified their action against the petitioner. It is submitted that because of none execution of the agreement and non-performance of the work, the respondent had to invite fresh tender, in which one Shri B.L. Jain submitted higher price @ 1.2 below SOR. Due to urgency in the matter, the Board had no option, but to award the work to another contractor, due to which, the Board suffered the loss of Rs. 13,70,227/- at the risk and costs of the petitioner and execution of the work was also delayed by thee months, due to which, image of the Board has suffered. 5. So far as the competency to take action is concerned, the respondent has submitted that the State Government has issued an order dated 19/11/1999 relating to suspension/blacklisting/demotion/cancellation of the registration of contractor, by which the officers not below the rank of Chief Engineer of the concerned Department were authorized to action. By order dated 24/03/2015, the officers upto the rank of Chief Engineer or equivalent officer of the concerned department/Board have been empowered to blacklist or suspend the registration of such contractors. The Additional Housing Commissioner is competent under the M.P. Housing and Infrastructure Development Board (Conduct of Business and Delegation of Powers) Regulations, 2015 to pass the impugned order. It is further submitted that the petitioner is having remedy to approach the M.P. Madhyastham Adhikaran, Bhopal. 6. I have heard the learned counsel for the parties. 7. The petitioner, after acceptance of the tender did not execute the agreement and did not start the work, for which the earnest money has been forfeited and the work was awarded at the risk and costs of the petitioner to some other agency, for which, the Board has suffered a loss of Rs. 13,70,227/-. 8. The only controversy in this case is, whether the suspension of licence and debarment for the period of three years is justified or not. The Board has placed reliance over the order dated 24/03/2015 issued by the Secretary, Public Works Department, by which, the Competent Authority has been authorized to suspend the licence or blacklist the contractor, whose bid is accepted, but failed to execute the agreement. The suspension will be in addition to the forfeiture of the earnest money or any other penalty imposed as per the tender condition. The suspension will be in addition to the forfeiture of the earnest money or any other penalty imposed as per the tender condition. In this order, it has been made clear that the period of suspension should be for definite period. The note appended in the order is reproduced below : i. During the period of suspension neither his registration will be renewed nor fresh registration will be issued. ii Blacklisted contractor will not be allowed fresh registration or renewal of his registration till order of black listing is revoked or cancelled. iii Contractor or firms black listed or suspended or any of it's partner will not be registered under any other name. iv Period of suspension should be for a definite period. 9. Placing reliance over the said order, the respondent has tried to justify that three years' period is definite period, for which the petitioner was debarred to participate in the contract. 10. The petitioner has placed reliance over the Clause-4.7.1 of the tender document and according to which, in the event of the tenderer withdrawing the offer, before the expiry of the period of validity, he will not be entitled to tender for this work in case of recall in addition to forfeiture of his earnest money. It is further provided in the said Clause that if the tenderer has committed a similar default on an earlier occasion as well, his registration in the Board may be suspended temporarily for the period of six months. The Clause is reproduced below : 4.7.1 In the event of the tenderer withdrawing the offer, before the expiry of the period of validity of offer failing to execute the contract Agreement as required by the condition 8.1.1 of the Notice Inviting Tender, he will not be entitled to tender for this work in case of recall in addition to forfeiture of his earnest money. If the tenderer has committed a similar default on an earlier occasion as well, his registration in the Board may be suspended temporarily for a period of six months from such date as may be ordered by the competent Authority which has registered him. 11. On successive default, the Board is competent to suspend licence temporarily for the period of six months as per the condition of NIT. It is not the case of the Board that this is successive default committed by the petitioner. 11. On successive default, the Board is competent to suspend licence temporarily for the period of six months as per the condition of NIT. It is not the case of the Board that this is successive default committed by the petitioner. The petitioner as well as the respondent are bound by the conditions of the NIT. The order dated 24/03/2015 authorizes the Board to take action in respect of the suspension of licence for definite period. The period is not prescribed in the order dated 24/03/2015. The period is prescribed i.e. six months in the NIT, therefore, the suspension cannot be more than six months, so far as the present work is concerned. The period of suspension is to be decided from the nature and quantum of the work order. Looking to the nature of the work and value of the contract, parties to the agreement has agreed that the period of suspension would not be more than six months and specific condition has been incorporated in the NIT. Therefore, the period of suspension of licence of the petitioner cannot be more than six months. The respondent has wrongly debarred the petitioner for the period of three years. Accordingly, the impugned order dated 10/07/2015 is hereby quashed. 12. Since the Appellate Authority has not considered this condition no. 4.7.1 of the NIT while deciding the appeal, therefore, the order passed by the Appellate Authority is also set aside. The licence of the petitioner was suspended on 10/07/2015 and interim relief was granted on 15/12/2016, therefore, the petitioner has already suffered suspension for more than six months. The respondents are directed to permit the petitioner to participate in the tender process, however, right to recover the amount are still with the respondents and they are free to recover the losses. Only, the issue of suspension has been decided in this petition. 13. Present writ petition stands allowed accordingly.