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2019 DIGILAW 1673 (KAR)

Adishakti Transformers v. State Of Karnataka, Department Of Energy

2019-07-12

S.G.PANDIT

body2019
JUDGMENT : S.G. Pandit, J. 1. The petitioners are before this Court under Article 226 of the Constitution of India praying to quash the short term tender notifications published on 06.06.2019 for repairs and reconditioning of faulty conventional and BEE distribution transformers of various capacities of different makes at different divisions of HESCOM and for a direction to the respondents to consider the representations dated 26.06.2019 for extension of contract period. 2. The petitioners are successful bidders for the repair works of respective sub-divisions for the year 2018-19 tenders invited by HESCOM. The learned counsel for the petitioners points out that the contract entered into between the petitioners and HESCOM and the work order issued on 26.05.2018 would indicate that the contract work period for repair is for one year from the date of DWA and the same is extendable by another four years at HESCOM discretion. Clause 1 of letter of intent reads as follows: "1. Period of Contract: The contract period of this repair center is for One year from the date of DWA, and the same is extendable by another 4 years at HESCOM discretion." 3. Clause 9 of the intent reads as follows: "9. Performance Guarantee: You have to submit within 15 days from the date of issue of LOI, a Performance Bank Guarantee of Rs.3,15,000/- (Rupees Three Lakhs and Fifteen Thousands only). Which will be discharged at the end of the contract period without any interest, unless otherwise specified along with contract agreement. The mode of payment shall be in the form of Bank Guarantee of Nationalized Bank endorsed in favour of the HESCOM for the due performance & fulfillment of the contract. The bank guarantee shall be valid for a minimum period of Three Years." 4. As per Clause 9 performance guarantee is to be submitted by the petitioners for a period of three years. 5. Annexure-E is the agreement of contract for the year 2018-19. Clause 19 of the agreement reads as follows: "19. The contract period of this repair center is for 1 year from the date of DWA and the same may be extended for another 4 years (total 5 years) at HESCOM Discretion subject to satisfactory performance of the repairer. The repairer shall not damage HESCOM property, Building and apparatus. In the event of any damage the repairer shall compensate the same as per HESCOM assessment." 6. The repairer shall not damage HESCOM property, Building and apparatus. In the event of any damage the repairer shall compensate the same as per HESCOM assessment." 6. Per contra, the learned counsel for respondent Nos.2 and 3 would submit that the petitioners have no legal right for extension of time. The term of their contract was expired on 15.07.2019 and subsequently they have made representation on 27.06.2009. Respondent Nos.2 and 3 have invited tender for repair work on 06.06.2019 and the last date for submitting tender is 15.07.2019 and the petitioners could participate in the said tender. 7. It is not in dispute that the petitioners are successful bidders for repair work for the year 2018-19. They have entered into an agreement and the agreement produced indicates that even though the contract period is one year at the discretion of HESCOM. The same is extendable by another four years depending upon the satisfactory work carried on by the petitioners. Admittedly the respondents have taken bank guarantee for five years. The performance guarantee is also submitted by the petitioners is for three years. The petitioners have admittedly submitted representation at Annexure-B series requesting respondent Nos.2 and 3 to consider their request for extension of contract period. 8. The above clause would make it clear that the contract period is one year from the date of DWA and could be extended for another four years (4 to 5 years) at HESCOM discretion subject to satisfactory performance of the repair. As per the contract agreement, the petitioners have furnished bank guarantee for the period from 21.03.2018 to 20.03.2021 for a period of five years. The learned counsel invites attention of this Court to Annexure-K and K1, wherein the contracts of the year 2014 have been extended for a period of four years. 9. The learned counsel for the petitioners would also submit that prior to that, they have also submitted representations and on the said representations, the Executive Engineer vide letter dated 28.05.2019 document No.4 produced along with memo filed on 11.07.2019 recommended for extension of contract period. 10. Taking note of the above noted facts, I am of the view that the petitioners are entitled for a direction to the respondents to consider their representations produced at Annexure-B series. 10. Taking note of the above noted facts, I am of the view that the petitioners are entitled for a direction to the respondents to consider their representations produced at Annexure-B series. Accordingly, respondent Nos.2 and 3 are directed to consider the representations at Annexure-B series and pass appropriate orders before finalization of the tenders invited under Annexure-A. The petitioners are also at liberty to participate in the tender process in pursuance to Annexure-A dated 06.06.2019. With the above observations, the writ petitions are disposed off.