Varghese Scaria, S/o. P. T. Scaria v. State of Kerala, Represented by the Chief Secretary
2024-01-25
DEVAN RAMACHANDRAN
body2024
DigiLaw.ai
JUDGMENT : The petitioners in these cases are contractors who have entered into contracts with the Public Works Department (PWD)of the Government of Kerala, qua road work involving bitumen. 2. The petitioners assert that as per four Government Orders, namely, the ones dated 13.11.2018, 17.04.2020, 25.09.2020 and 30.04.2021, certain specific benefits were given to all the contractors, which enabled them to claim the difference of the cost of bitumen between the date of the Agreement and the date of invoice; and that though the Authorities had granted such benefits to various others, they have been singled out and discriminated, in being denied it. 3. Smt. R. Ranjanie – learned counsel appearing for the petitioners in WP(C) No.32096/2022, assertively argued that the flow of benefit from the afore four Government Orders clearly was available to her client - whose Agreement was entered into on 17.11.2022, which is evident from Exts.P8, P13, P15 and P16 - but that it has not been afforded to him, though; through the subsequent Government Order dated 26.08.2022, the Government made it clear that the payment of the price difference, as ordered in the aforementioned four Government Orders, would stand withdrawn with retrospective effect, but for all future tenders alone. She, therefore argued that her client is entitled to claim the benefits, as admitted in Ext.P8; and thus, prayed that the respondents be directed to disburse the amount mentioned therein without any avoidable delay. 4. Sri. R.T. Pradeep, Sri. Abdul Rasac and the learned counsel appearing for petitioners in WP(C) Nos.32568/2023 and 25233/2022 also made analogous assertions, contending that their clients are also entitled to the benefit of the difference of cost of bitumen, under the aforementioned four Government Orders. They also, therefore, prayed that the reliefs sought for in their respective writ petition be granted. 5. However, in response, Sri. K.V. Manojkumar – learned Government Pleader, submitted that the petitioners cannot impel any claim, as has been done in these cases at this time because, in the judgment delivered in M/s Malabar Tech v. State of Kerala [WP(C) No.22964/2021], a learned Judge of this Court has made it indubitably limpid that the benefits of the aforementioned Government Orders are intended only for those contractors who were continuing with their work as on 01.11.2018.
He submitted that, when the said declaration remains without modification, or without challenge, it would not be available to the petitioners to argue to the contrary and to claim such benefit, even when they admit unequivocally that none of their works contracted were continuing as on 01.11.2018; especially when, even the tendering processes, based on which such contracts were given, were much after that date. He, therefore, prayed that these writ petitions be dismissed. 6. Though I have been parsimonious to some extent in recording the pleaded factual details and the submissions made on behalf of the parties, I have indited the essential aspects projected in these cases. 7. As noticed, the controversy in these cases has its genesis in an admitted price escalation of bitumen, which was noticed by the Government in the year, 2018, which lead them to issue the aforementioned order, one after the other. 8. For the sake of convenience, except otherwise specified, exhibits will be referred to in the judgment as they appear in WP(C) No.25233/2022. 9. When one examines the first of the Government Orders referred to and relied upon by the petitioners, namely that dated 13.11.2018 – produced as Ext.P1 - the Government allowed the benefit therein to the contractors because, the price of bitumen, as on April, 2018 was found to have increased by 33% and therefore, it was clarified that the price difference of bitumen on the date of closing of the tenders and the date of invoice – specifying such invoice date to be on or after 01.11.2018 – will be paid to the contractor, on production of the original invoice, for the actual quantity consumed. 10. Subsequently, the Managing Director of a Labour Contract Society appears to have moved the Government, seeking a clarification of the afore order, to the effect whether the payment as afore can be reckoned as being the period between the date of Agreement and the period of invoice; and this was acceded to by it, through the subsequent Government Order dated 17.04.2020 - namely Ext.P2.
It is pertinent herein that while the Government modified Clause No.1 of Ext.P1 Government Order, only to the extent that the price difference of bitumen as on the date of Agreement and the date of invoice – still specifying that, if it on or after 01.11.2018 - can be paid to or from the contractor - as the case may be; but without altering the category of the contractors, to whom such benefits would flow. 11. That being so, the Chairman of the “Builders Association of India”, then transpires to have approached the Government, seeking a further clarification whether, for open bidders, the price difference of bitumen, as on the date of closing of the tenders and the date of invoice (on or after 01.11.2018), will become payable. The Government seen to have acceded to this request; and thus issued the 3rd Government Order dated 25.09.2020, namely Ext.P3, virtually restoring the original clause of Ext.P1, saying that the price difference as on the date of closing of tenders and the date of invoice – provided it is on or after 01.11.2018 - will be payable. 12. Here again, the category of contractors to which the benefit was to flow was not altered, namely those whose works were ongoing as on 01.11.2018. 13. The matter did not end here. 14. A further representation appears to have been preferred made by the “All Kerala Contractors Association” and the “Builders Association of India”, to the Government, seeking clarification as to the rate while calculating the allowable price difference and if Ext.P3 order would be applicable to the Agreement executed after 01.11.2018. The Government, thereupon, issued the fourth order dated 30.04.2021, namely Ext.P4, specifying the rates (with which we are not concerned about in these cases) and clarifying that the said Government Order will apply for all ongoing works “and works for which Agreements are executed after 01.11.2018” (sic) (emphasis applied). 15. Interestingly, it is the emphasised portion of Ext.P4, which is now being relied upon by the petitioners, to claim that they would be entitled to the price difference of bitumen, as mentioned in the afore four Government Orders, even for contracts, the bid process of which was much after 01.11.2018; and axiomatically, Agreements and closure of tender, being also after that date. 16.
16. To get a grip of the controversy in question, one must certainly closely analyse the impact of the four Government Orders mentioned above. 17. As I have already said earlier, the modifications through Exts.P2, P3 and P4 were exclusively to the rates and the manner of calculation of difference of bitumen as originally specified in Ext.P1 Government Order, which was issued on 13.11.2018; and at no point of time – which is virtually without contest – were the category of contractors entitled to the benefit thereunder, modified or altered - it continuing to be only those whose works were continuing as on 01.11.2018. 18. In such perspective, when one examines Ext.P4 with some care, it will be discernible that, while clarifying that the said order will apply to works, for which the Agreements are executed after 01.11.2018, it indubitably took into its fold, the prescriptions in Ex.P3 Government Order dated 17.04.2020. 19. In other words, only those works, of which the date of closing of tenders was completed before 01.11.2018, would obtain the benefit of the price difference of bitumen, until such time as the invoice was issued, provided it was done after 01.11.2018; and it is this that has been made applicable even to contracts that were entered into after 01.11.2018, through Ext.P4. 20. To paraphrase, Ext.P4 clarifies that contracts for which the tender was closed prior to 01.11.2018, but the Agreements qua which had not been entered until that date or thereafter, would still inure to the contractors the original benefit under Ext.P1 Government Order, modified subsequently through Exts.P2, P3 and P4; but not in any other scenario. 21. Obviously, therefore, for the petitioners to now receive any benefit, they must establish that the contracts which they have entered into, were the ones with respect to which the tenders were closed prior to 01.11.2018, but the Agreements for which were entered into after that the said date. 22. However, it is without dispute that each of the contracts involved in these cases had even its parturition after 01.11.2018; and that the tender processes and Agreements began and were entered into much later – even years thereafter. 23.
22. However, it is without dispute that each of the contracts involved in these cases had even its parturition after 01.11.2018; and that the tender processes and Agreements began and were entered into much later – even years thereafter. 23. That being said, I am obligated to consider the further argument of Smt. R. Renjanie, that the Government Order subsequent to the afore orders, namely the one dated 26.08.2022 – a copy which has been produced by her as Ext.P11 along with her writ petition, namely WP(C) No.32096/2022 - would render the position luculent that, even though contracts which were entered into after 01.11.2018 would get the benefit of the aforementioned Exts.P1, P2 P3 and P4 Government Orders. 24. In this regard, when one examines the aforesaid Government Order, closely, it gets rendered limpid, that the said order was issued based on the objections raised by the Controller and Auditor General, who recommended that, since contractors who entered into contract later were bound to quote their rates after proper study of the fluctuation of market rates, they cannot be given any further benefit. This propelled the additional Chief Secretary (Finance), to issue the aforesaid Government Order, clarifying that the “price difference/recovery of Price reduction of bitumen ordered by Government order dated as first to fourth, discontinued with prospective effect, for all future tenders”(sic). 25. It is thus ineluctable that, even when the aforesaid Government Order was issued, the Government was only referring to the earlier Orders mentioned therein, namely Exts.P1 to P4. 26. As has been already been assessed above, Exts.P1 to P4 Government Orders never extended any benefit, as mentioned therein, to any category of contractors, other than those whose works were continuing as on 01.11.2018; and whose tenders were closed prior to that date, though Agreements were entered into subsequent to it. As long as this classification remained without change in all the Government Orders – with only the nature of the benefits being modified from time to time, as also the rates - any contractor who did not fall within that species surely cannot obtain any benefit under its ambit.
As long as this classification remained without change in all the Government Orders – with only the nature of the benefits being modified from time to time, as also the rates - any contractor who did not fall within that species surely cannot obtain any benefit under its ambit. However, it reflects from the pleadings on record in some of these writ petitions and in particular (WC) No.32096/2022, that, without being aware of this, some of the officers continued to offer such benefits to ineligible contractors, including the petitioners herein; and this is illustratively manifested from Ext.P8, produced along with WP(C) No.32096/2022. 27. That being so, the acme question here is whether the recommendations/observations made by the officers would entitle benefit to contractors, even when they are forensically not entitled to it, going by the Government Orders which they rely upon, for seeking such. 28. The answer to this can certainly be only to the negative because, the entitlement of a person squarely would depend upon the prescriptions in law; and if it is proscribed, it cannot be granted, even if it is recommended by any Authority, either being oblivious to its sweep, or for other reasons. 29. In the afore backdrop, it becomes without any doubt that, it was unnecessary for the Government to have issued the Government Order dated 26.08.2022 (produced as Ext.P11 in WP(C) No.32096/2022) because, what was sought to be taken away through that Order - prospectively or otherwise - were benefits that were never available to any class of contractors, except those who are covered by Exts.P1 to P4. As far as the latter class, namely, those covered by Exts.P1 to P4, is concerned, the aforesaid Government Order dated 26.08.2022 can certainly not apply because, their rights have already been crystallized and vested, for the singular reason that their works were ongoing as on 01.11.2018. 30. No doubt, in such perspective, the view adopted by a learned Judge of this Court in M/s Malabar Tech (supra), certainly travels on the same lines as my observations above; and am in affirmation of the same. In fact, in paragraph 22 of the said judgment, the learned Judge concluded on this issue as under; “The benefit or advantage conferred under Ext.P8 Government Order is intended only for those projects of the contractors which were ongoing projects as on 01.11.2018.
In fact, in paragraph 22 of the said judgment, the learned Judge concluded on this issue as under; “The benefit or advantage conferred under Ext.P8 Government Order is intended only for those projects of the contractors which were ongoing projects as on 01.11.2018. The modifications effected by Exts.P8, P9 and P10 orders would obviously apply only to those ongoing contract works as on 01.11.2018, as contemplated by Ext.P8 Government Order. As Exts.P8 to P10 Government Orders are intended to apply only to ongoing contract works as on 01.11.2018, those orders cannot be made applicable to the works undertaken by the petitioners, subsequently, which were not ongoing works as on 01.11.2018.” 31. This Court is also aware that in Mohammed Ahnas B. v. State of Kerala [WPC 19474/2022], another learned Judge of this Court took the same view, concluding as under in paragraph 21 thereof. “Moreover, I do not think that the contention raised by the petitioner on account of Exhibit P4 Government Order dated 30.04.2021 revising the Government Order dated 13.11.2018 that he is entitled to get the benefit of the said Government Order, cannot be sustained, since the original Government Order for payment of the price escalation of the bitumen dated 13.11.2018 was issued by the Government to tackle the situation of an unprecedented increase of bitumen that has happened in the year 2018 consequent to the enhanced price of petroleum products and thus, increasing the price of bitumen by 33%. All the subsequent revision made by the Government and relied upon by the petitioner is only the revision of the Government Order dated 13.11.2018. Therefore, I am of the view that the said Government Orders would not enure to the benefit of the petitioner who has entered into the contract on 21.12.2020 with definite terms and conditions.” In the afore circumstances, these writ petitions are dismissed, without any further orders.