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2022 DIGILAW 577 (GAU)

Lalmalsawma v. Union of India

2022-06-02

NELSON SAILO

body2022
JUDGMENT : Heard Mr. Lalfakawma, learned counsel for the petitioner and Ms. Zairemsangpuii, learned CGC appearing for the respondents. [2.] Facts of the case in brief is that the respondent authority concerned floated a Notice Inviting Tender (NIT) on 26.05.2011 for construction/improvement of road sector KM 0.00 to km 11.42 of Farkawn-Thekte to C.L-9(N) (FMN width 12 meter except permanent and surfacing works)-NET length 11.42 KMs in Mizoram State. Against the NIT, the petitioner quoted Rs. 799 lakhs and vide Communication dated 04.11.2011 was awarded the work for a sum of Rs. 7,99,91,387/-. [3.] The petitioner on being awarded the work began to execute the work and finally completed the same. A certificate of compulsory completion on the work was issued to the petitioner by the concerned authority on 02.07.2014 certifying that the petitioner completed the work on 27.06.2014. [4.] The facts leading to the present controversy is that as per Serial Nos. 3 & 4 on Schedule-A of the tender document, the petitioner was to execute formation cutting on the soft rock and hard rock respectively. The quantity in respect of soft rock was 229425.74 cubic meters while it was 93852.41 in respect of hard rock. The excavation work was allotted to the petitioner at the rate of Rs. 136.35 per cubic meter for soft rock and at the rate of Rs. 149 per cubic meter for hard rock. However, while executing the work, the petitioner did not encounter any hard rock and he therefore informed the respondent authority concerned vide Communications dated 29.05.2012 & 01.09.2012 that he has not encountered any hard rock and therefore, clause-33 of the special condition of the contract agreement be deleted. Be it stated herein that clause-33 is about retrieved material. It provides that the hard rock encountered during the formation cutting and excavation will be the property of the Department and that 33% of hard rock cutting as mentioned in Schedule- A shall be considered as retrieved material and stacked neatly on specified ground as directed by the Engineer-in-Charge and no extra payment shall be made on this account. [5.] In view of above development, a team, i.e., Technical Board of Officers conducted a verification on 21.05.2014 and came to a finding amongst others that the soft rock being excavated on ground was 312055.21 cubic meters against 229425.74 cubic meters prescribed in the contract agreement. [5.] In view of above development, a team, i.e., Technical Board of Officers conducted a verification on 21.05.2014 and came to a finding amongst others that the soft rock being excavated on ground was 312055.21 cubic meters against 229425.74 cubic meters prescribed in the contract agreement. As for the hard rock, there was no excavation on the ground. Likewise, the construction of underlined drain in soft rock was 5042 cubic meters on the ground against 4423.20 cubic meters prescribed in the contract agreement and that there was no construction in respect of unlined drain in hard rock. [6.] What followed was that the petitioner was required to show his willingness for the amendment of the contract agreement in view of the developments and the petitioner accordingly submitted his willingness to the respondent authority concerned on 25.06.2014 with the actual figures as was recorded by the team of Technical Board of Officers when verification was made on 21.05.2014. However, the contract agreement was not amended and in the meantime, work completion certificate was issued to the petitioner on 02.07.2014. The petitioner then submitted his final bill for Rs. 1,36,59,377/- on the basis of joint survey and acceptance by both the parties and recorded in the meeting held on 24.06.2014. However, the respondent authorities instead accepted the final bill as Rs. 57,30,784/- to the petitioner and communicated the same to the petitioner on 22.02.2016. The respondents thereafter issued a show-cause dated 03.05.2016 to the petitioner asking him to accept the revised rates as per the lowest rate (L-1) that was quoted by M/s Durga Krishna Store Pvt. Ltd., in respect of rough excavation in soft rock i.e., @ Rs. 125 per cubic meter instead of the amount quoted by the petitioner at the rate of Rs. 136.35 per cubic meter Aggrieved with the same, the petitioner is before this Court. [7.] Mr. Lalfakawma, learned counsel for the petitioner submits that the petitioner was allotted the work at the rates quoted by him and particularly for the purpose of the present case, at the rate of Rs. 136.35 per cubic meter for rough excavation on soft rock. The petitioner’s quoted rate for rough excavation in hard rock was Rs. 149 per cubic mtr. Lalfakawma, learned counsel for the petitioner submits that the petitioner was allotted the work at the rates quoted by him and particularly for the purpose of the present case, at the rate of Rs. 136.35 per cubic meter for rough excavation on soft rock. The petitioner’s quoted rate for rough excavation in hard rock was Rs. 149 per cubic mtr. However, when actual execution work was done, the petitioner did not find any hard rock and after informing the respondent authorities concerned about the same, he completed the entire work and which also was acknowledged by the authority concerned by issuing him work completion certificate. The respondent authorities after having accepted the rates quoted by the petitioner cannot change the rate for execution the work in respect of soft rock by taking the lower rate quoted by the unsuccessful bidder. He submits that the petitioner has executed the entire work in a transparent manner by informing them that he did not come across any hard rock but only soft rock in excavation process. The team of Board of Officers had also made a spot verification on the ground and came to the finding that the petitioner had excavated 312055.21 cubic meters of soft rock. He, therefore, submits that the petitioner is entitled to be paid the amount for actual work executed. Mr. Lalfakawma, learned counsel submits that during pendency of the writ petition as directed by this Court, the undisputed amount of Rs. 57,30,784/- was paid to the petitioner and now the remaining balance to be paid is Rs. 79,63,628/-. The respondents may, therefore, be directed to pay the amount along with the interest for the delay payment. [8.] Ms. Zairemsangpuii, learned CGC, on the other hand, by referring to the affidavit-in-opposition filed by the respondents submits that as per the condition of the contract agreement, all disputes between the parties to the contract has to be referred to the sole arbitrator by either of the parties and therefore, the petitioner will have to avail such remedy instead of approaching this Court. She submits that on this ground, the writ petition may not to be entertained and the same should be dismissed. She submits that on this ground, the writ petition may not to be entertained and the same should be dismissed. The learned CGC further submits that since the petitioner did not encounter hard rock during the excavation process, it was therefore necessary to allot the contract agreement and without such amendment, the claim of the petitioner cannot be accepted. She also submits that as there was no hard rock to be excavated on the ground, the rate quoted by the petitioner for the soft rock alone cannot be accepted and that is why, the petitioner having become the second lowest, the rate quoted by M/s Durga Krishna Store Pvt. Ltd., being Rs. 125 per cubic meter being the lowest rate, the petitioner will be entitled to the said rate only. The undisputed amount that was calculated with the lowest rate having been already paid to the petitioner, the petitioner is not entitled to any further relief and the writ petition should be dismissed. [9.] I have heard the submissions made by the learned counsels for the rival parties and I have perused the materials available on record. [10.] What can be seen from the projection made by the petitioner is that he was awarded the contract work at the rates quoted by him. Importantly, for the present controversy, the rates quoted by him for excavation of soft rock was 136.35 per cubic meter and in respect of hard rock, it was Rs. 149 per cubic meter. After the same was accepted by the respondent authorities, the petitioner was allowed to execute the work. However, while executing the work, the petitioner did not encounter any hard rock but soft rock only. Information in this regard was given to the respondents by the petitioner and there was also an attempt to amend the contract agreement and for which, the petitioner on 25.06.2014 had submitted his willingness. Despite the same, no amendment was made to the contract agreement and the petitioner completed the work on 27.06.2014. A certificate to this effect was issued by the competent authority on 02.07.2014. The question which therefore arises is as to whether the petitioner can be compelled to accept execution of the work with the rate which was not quoted by him but by the unsuccessful bidder. A certificate to this effect was issued by the competent authority on 02.07.2014. The question which therefore arises is as to whether the petitioner can be compelled to accept execution of the work with the rate which was not quoted by him but by the unsuccessful bidder. According to the respondents, as it was discovered that there was no hard rock on the ground, the petitioner not having quoted the lowest rate in the excavation of soft rock, his quoted rate cannot be accepted and instead, the lower rate quoted by the unsuccessful bidder should be adopted. This reasoning given by the respondents in my considered view cannot be accepted for more than one reason. Firstly, the rate of Rs. 125 per cubic meter for excavation of soft rock is neither the quoted rate of the petitioner nor the basis on which the petitioner was allotted the work. Secondly, when the petitioner himself has informed the respondent authorities concerned of not having encountered hard rock but only soft rock, a verification was accordingly made by the Technical Board of Officers on the ground and it was their finding that the petitioner had excavated 312055.21 cubic meters of soft rock. With such finding, the respondents cannot strike a bargain with the petitioner by imposing on him the rate quoted by the unsuccessful bidder for soft rock excavation. Thirdly, the respondents being satisfied with the work executed by the petitioner have themselves issued a work completion certificate soon after the verification was made by the Technical Board of Officers. Such being the case, the steps adopted by the respondents are found to be unfair, unreasonable and arbitrary. [11.] Coming to the question on alternative remedy provided in the contract document by way of arbitration, it would be relevant to refer to the decision of the Apex Court in the case of Kumari Shrilekha Vidyarthi vs. State of Uttar Pradesh (1991) 1 SCC 212 where it was held that the requirements of Article 14 extends even in the sphere of contractual matters for regulating the conduct of the State activity. Applicability of Article 14 to all executive actions of the State being settled and for the same reason, its applicability at the threshold to the making of a contract in exercise of the executive power being beyond dispute, the State cannot thereafter cast off its personality and exercise unbridled power unfettered by the requirements of Article 14 in the sphere of contractual matters and claim to be governed therein only by private law principles applicable to private individuals whose rights flow only from the terms of the contract without anything more. The said decision was also quoted by the Apex Court in the case of ABL International Ltd. & Anr. vs. Export Credit Guarantee Corporation of India Ltd. & Ors., (2004) 3 SCC 553 in order to come to a conclusion that in an appropriate case, the writ court has the jurisdiction to entertain a writ petition involving disputed questions of fact and there is no absolute bar for entertaining a writ petition even if the same arises out of a contractual obligation and or involves some disputed questions of fact. Similarly, ABL International Ltd. & Anr. (supra) was again referred by the Supreme Court in its order dated 08.03.2019 passed in Civil Appeal No. 2610/2019 (M/s Surya construction vs. State of Uttar Pradesh & Ors.) to hold that when the State behaves arbitrarily, even in the realm of contract, the High Court can interfere under Article 226 of the Constitution of India. [12.] Coming to the facts of the present case, I find that the respondents have acted irrationally and arbitrarily in trying to impose the rate which was not quoted by the petitioner and therefore, the existence of an alternative remedy in the contract documents in my considered view will not render the writ petition as not maintainable and the ratio laid down by the Apex Court in Kumari Shrilehkha Vidyarthi (supra) is found to be applicable. [13.] Therefore, under the facts and circumstances of the case and upon due consideration, I find merit in the writ petition. The respondents are therefore directed to pay the petitioner a sum of Rs. [13.] Therefore, under the facts and circumstances of the case and upon due consideration, I find merit in the writ petition. The respondents are therefore directed to pay the petitioner a sum of Rs. 79,63,628/- (Rupees Seventy Nine Lakh, Sixty Three Thousand, Six Hundred Twenty Eight) only, which is the balance amount due to the petitioner within a period of 2 (two) months from the date of receipt of a certified copy of this order, failing which the respondents shall be liable to pay interest at the rate of 9% per annum on the amount due, till the same is finally paid. It is needless to mention herein that the impugned Communication dated 22.02.2016 and the impugned show-cause notice dated 03.05.2016 are hereby set aside. [14.] With the above observations and directions, the writ petition stands disposed of as allowed. No cost.