ORDER : (Shree Chandrashekhar, J.) : GVPR Engineers Limited is aggrieved by the order dated 29th July 2024 by which S.B. Civil Writ Petition No.12533/2024 has been dismissed observing as under:- “5. Further, admittedly, the deductions sought to be made by the respondent-Department are being made in terms of Clause 2 of the agreement in question. Firstly, as is the settled position of law, no writ is maintainable in contractual matters. Secondly, so far as Clause 2 of the agreement is concerned, it provides for deduction of amount from running bills if the pro-rata progress, as required, is not maintained. The dispute as to whether the pro rata progress was maintained and as to whether the amount of deduction as sought to be made, could be made, are totally disputed questions of fact. Thirdly, the fact as to whom the delay in completion of the work was attributable, is also a totally disputed question of fact which cannot be gone into by this Court in writ jurisdiction. The remedy of the petitioner lies somewhere else.” 2. The appellant-firm has pleaded that pursuant to NIB dated 2nd February 2022 for supply of drinking water to 306 villages in the District of Jalore under the Jal Jeevan Mission (JJM), it was declared L1 bidder. On 3rd June 2022, the subject works under the NIB were awarded to the appellant-firm for a total cost of Rs.8,33,48,61,509/- the operation and maintenance of which was to continue for ten years; the scheduled completion period was 21 months. The appellant-firm raised various grievances particularly relating to handing over of Elevated Storage Reservoir (ESR) & Clear Water Reservoir (CWR) and also requested the respondent-authority to demarcate OHSR and CWR-cum-PH (Pump House) locations. According to the appellant-firm, the reason for slow progress of the project was attributable to inaction on the part of the respondent-authority. However, a letter dated 23rd September 2022 was served upon it as regards slow progress of the project which was duly replied by it on 10th October 2022. According to the appellant-firm, the reason for slow progress of the project was attributable to inaction on the part of the respondent-authority. However, a letter dated 23rd September 2022 was served upon it as regards slow progress of the project which was duly replied by it on 10th October 2022. In this appeal, we are not required to refer to the rival stand taken by the parties and it would suffice to observe that in the letter dated 2nd February 2024 seeking extension of time up to 12th March 2025, the appellant-firm raised issues relating to (a) land (b) major scope of work (c) changes in the survey requirements in the Project (d) delay in release of pending payments (e) effect of Biparjoy Cyclone and (f) non-release of 6% GST, etc. 3. The appellant-firm has raised a grievance that in the garb of the order issued by the Chief Engineer (Project), Public Health Engineering Department (PHED), Jodhpur digitally signed on 9th February 2024 provisional time extension for completion of the subject work under the NIB was approved; whereby an extension till 31st December 2024 was given to the appellant-firm. Mr. M.S. Singhvi, the learned senior counsel for the appellant-firm submits that the order dated 29th July 2024 does not record any reason and on the contrary it says that the department shall have right to recover compensation for delay, as admissible. The learned senior counsel would refer to clause 2 of the bid document captioned as ‘Compensation for delay’ vide annexure-13 at page 119 of the writ Court’s record to submit that it is only if the contractor fails to complete the work in accordance with the time schedule and the delay in execution of work is attributable to the contractor, the contractor shall be liable to pay compensation to the Government as provided in the table appended below clause 2. The learned senior counsel has also referred to Note appended to clause 2 to submit that dismissal of the writ petition has in fact foreclosed all options to the appellant-firm. 4. The learned senior counsel for the appellant-firm has relied on the decisions in “Unitech Ltd. & Ors. The learned senior counsel has also referred to Note appended to clause 2 to submit that dismissal of the writ petition has in fact foreclosed all options to the appellant-firm. 4. The learned senior counsel for the appellant-firm has relied on the decisions in “Unitech Ltd. & Ors. v. Telangana State Industrial Infrastructure Corporation & Ors.” reported in (2021) 6 SCC 35, “M.P. Power Management Company Ltd. Jabalpur v. Sky Power South East Solar India Pvt. Ltd. & Ors.” reported in (2023) 2 SCC 703 and “Madras Aluminum Company Ltd. v. Tamilnadu Electricity Board & Anr.” reported in (2023) 8 SCC 240 . With reference to these judgments, Mr. M.S. Singhvi, the learned senior counsel appearing for the appellant-firm would submit that the projected disputed questions of fact cannot be made a smoke screen to guillotine grievance raised by the contractor. 5. A preliminary objection has been taken by the respondents on the ground that serious disputed questions of fact are involved and, therefore, this Special Appeal is or for that matter the writ petition was not maintainable. It is pleaded that under clause-23 of the general terms and conditions of contract, any question, difference or objection arising from the contract shall be referred to the Standing Committee for settlement of the dispute. In the counter affidavit, the respondent- Public Health Engineering Department, Jodhpur has taken the following stand:- “Preliminary Objections:- 1. That, the Special Appeal Writ as well as the Writ Petition filed by the appellant/ petitioner is not maintainable for the reason that it involves serious disputed questions of facts which cannot be decided by this Hon’ble Court under its extraordinary writ jurisdiction as the same are required to be proved by leading proper evidence. 2. That, the present Special Appeal Writ as well as the Writ Petition is not maintainable as the whole controversy in the matter resolves around general terms of the contract, as per clause 23 of the terms it is specifically provided that if there is any dispute, question, differences or objections arises out of the instrument then the matter shall be referred to the standing committee for the settlement of the dispute. The clause 23 of the general terms and conditions is reproduced for the ready reference as under:- Clause 23: STANDING COMMITTEE FOR SETTLEMENT OF DISPUTES If any question, difference or objection, whatsoever shall arise in any way, in connection with or arising out of this instrument, or the meaning of operation of any part thereof, or the rights, duties or liabilities of either party then, save in so far, as the decision of any such matter, as herein before provided for, and been so decided, every such matter constituting a total claim of Rs.50,000/- or above, whether its decision has been otherwise provided for and whether it has been finally decided accordingly, or whether the Contract should be terminated or has been rightly terminated, and as regards the rights or obligations of the parties, as the result of such termination, shall be referred for decision to the empowered Standing Committee, which would consist of the followings:- (i) Administrative Secretary concerned. (ii) Finance Secretary or his nominee, not below he rank of Deputy Secretary. (iii) Law Secretary or his nominee, not below the rank of Joint Legal Remembrance. (vi) Chief Engineer-cum-Addl. Secretary of the concerned department. (v) Chief Engineer concerned (Member-Secretary). The Engineer-in-charge, on receipt of application along with non-refundable prescribed fee, (the fee would be two percent of the amount in dispute, not exceeding Rs.One lac) from the Contractor, shall refer the disputes to the committee, within a period of three month from the date of receipt of application. Procedure and Application for referring cases for settlement by the Standing Committee shall be, as given Form RPWA 90 That as per the clause 23 of the contract the appellant petitioner ought to have made application for the dispute if any, to the authority provided under clause 23. 3. Procedure and Application for referring cases for settlement by the Standing Committee shall be, as given Form RPWA 90 That as per the clause 23 of the contract the appellant petitioner ought to have made application for the dispute if any, to the authority provided under clause 23. 3. That, the present writ petition is also not maintainable as there are disputed questions of facts regarding the delay and calculation of the penalty and also the performances of the terms of the contract therefore, the clause 51 of the contract defining jurisdiction of civil court, which is reproduced for the ready reference of the Hon’ble Court as under:- Clause 51: Jurisdiction of Court In the event of any dispute arising between the parties hereto, in respect of any of the mattes comprised in this agreement, the same shall be settled by a competent Court having jurisdiction over the place, where agreement is executed and by no other court, after completion of proceedings under Clause 23 of the Contract. It is clear from the above provisions that the appellant petitioner must have approached the standing committee under clause 23 of the contract and invoked clause 51 of the contract, therefore, the writ petition is not maintainable and deserves to be set rejected. The copy of relevant portion of the general terms of the contract is annexed herewith and marked as Annexure R/1. PARA WISE REPLY:- 2. That, the contents of para 2 of the appeal are denied, The learned Single Judge has rightly rejected the Writ Petition filed by the appellant as the same being not maintainable. It is denied that the deductions of liquidated damaged from the running bills have been made without adhering to the general conditions of contract and the prescribed procedure for deduction. The answering respondent’s authorities have very well acted in accordance with Clause 2 of the General Conditions of the Contract, under Clause 2 of the General Conditions of the Contract, there is specific provision for recovery of liquidated damages from the running bills. As prescribed under clause 2 of the General Terms and Condition of the Contract, if the delay is caused on the part of the contractor, then 10% of the total value of work can be recovered for the delay in the form of liquidated damages from the running bills. As prescribed under clause 2 of the General Terms and Condition of the Contract, if the delay is caused on the part of the contractor, then 10% of the total value of work can be recovered for the delay in the form of liquidated damages from the running bills. It is pertinent to mention here that the provisional time extension is given when the contractor applies for the extension of the time, to keep the contract alive and to also get the work executed at the earliest possible time. If there is any delay in the completion of the work and provisionally time has been extended, then the amount of liquidated damages is provisionally withheld from the running bills as per clause 2 of the General Terms and Conditions of the Contract and the same is kept in the security deposit head. Once the contractor submits the final certificate of the work completion, at that time the competent authority i.e. Finance Committee finally decide time extension application and determines the final amount of liquidated damages. That after determination of the final liquidated damages to be recovered, the amount so withheld is adjusted against the recoverable liquidated damages and remaining amount, if any is refunded to the contractor. The Answering Respondents have not withheld the amount of liquidated damages other than what’s prescribed under the clause of the Contract. That, as per the work order and the conditions of the contract the stipulated date for the commencement of the work was 13.06.2022 and date for completion was 12.03.2023. To the contrary, the prorate progress of the appellant petitioner firm was very slow and has not complied with the stipulated date for completion of the project. The stipulated date for completion of project was 12.03.2024, till the time the appellant petitioner has executed the work of amount Rs.3831334852/- which is just 52% of the total capital cost of the work, hence the firm was not working in accordance with the work order, regarding the same the answering respondents penned various letters to the appellant petitioner firm, but all remained in vain. On 23.09.2022 a letter has been written by Executive Engineer Project Division Bhinmal to the appellant to work according to action plan and to increase the prorated progress. On 23.09.2022 a letter has been written by Executive Engineer Project Division Bhinmal to the appellant to work according to action plan and to increase the prorated progress. Again, on 24.01.2023 letter has been sent to the appellant petitioner firm stating that the civil work (construction of Overhead Tank and Pump House) and the HDPE pipeline work is going on at a very slow rate. Further, it is submitted that on 02.02.2023 the respondent no.4 has written a letter to the appellant petitioner to increase the prorated progress rate as per the stipulated time span of the wise actions will be taken under Clause 2 and 3 of the General Terms and Condition of the Contract. Another letter was issued on 29.03.2023 to increase the prorated progress for the second span as the LD has already been imposed for the 1st span. Similarly, various notices were sent to the appellant petitioner to increase the pro rata work progress but the appellant/ petitioner firm has not worked in accordance to the terms of the agreement as well as work order, therefore, the LD has been withheld till then amount of liquidated damages be decided by the competent authority. The following table provides a brief about the slow financial progress and technical progress of the appellant/ petitioner at different span of time as per the work order:- S.No. Particulars 1/4th upto 21.11.22 1/2th upto 28.04.23 3/4th upto 05.10.23 Full Upto 12.03.2024 1. Work to be Executed 1/8th 3/8th 3/4th 4/4 Full 2. Amount of work to be executed (Rs.) 1015013169 3045039506 6090079012 8120105349 3. Actual Work Done (Rs. In crore) 438515954 1707861802 3002387710 3831334852 4. Work remained unexecuted (in crores) 576497215 1337177704 3087691302 4288770497 5. LD to be deducted of unexecuted work @ 2.50% 5.00% 7.50% 10% 6. LD to be deducted of unexecuted work (Rs. In Crores) 14412430 66858885 231576848 428877050 7. Span wise deduction 14412430 52446455 164717962 197300202 8. Span wise LD deducted 14412430 52446455 164717962 30227121 The above table clarifies that the petitioner has not completed the work as per the terms and conditions of the contract and the work order, therefore as per clause 2 of the General Terms and Conditions of the Contract the liquidated damages have been imposed, that too was only been withheld till the decision from the competent authority. The copy of letters dated 23.09.2022 are collectively annexed herewith and marked as Annexure R/2. The copy of letters dated 23.09.2022 are collectively annexed herewith and marked as Annexure R/2. The copy of letters dated 24.01.2023, 02.02.2023, 05.04.2023, 15.04.2023, 10.05.2023, 16.05.2023, are collectively annexed herewith and marked as Annexure R/3. The copy of letters dated 01.06.2023, 07.06.2023, 15.06.2023 are annexed collectively as Annexure R/4. The copy of letters dated 16.01.2024, 31.01.2024, 02.02.2024, 17.04.2024, 19.04.2024 are collectively annexed herewith and marked as Annexure R/5. The copy of notice under clause 2 and 3 dated 1.05.2024 are annexed collectively herewith and marked as Annexure R/6. The copy of notice for slow progress dated 05.06.2024, 12.06.2024 are annexed herewith collectively and marked as Annexure R/7. The copy of letters dated 15.07.2024, 23.07.2024 are annexed herewith collectively and marked as Annexure R/8. The span wise calculation is annexed herewith and marked as Annexure R/9.” 6. Objecting to this Special Appeal, Mr. Sajjan Singh Rathore, the learned Additional Advocate General submits that 10% deduction from running bills payable to the appellant-firm is by way of abundant precaution and such amount has been kept under the “security head” which may be released to the appellant-firm if the Finance Committee comes to a conclusion that there was no fault on the part of the contractor in execution of the subject works under the NIB. The learned Additional Advocate General further submits that the extension of time granted on 9th February 2024 is only provisional in nature and a final decision is yet to be taken by the Finance Committee. 7. Mr. Sajjan Singh Rathore, the learned Additional Advocate General has endeavored to support 10% deduction from the running bills payable to the appellant-firm with reference to the decisions in “BTL EPC Ltd. v. Macawber Beekay Pvt. Ltd. and Ors.”, “Kerala State Electricity Board and Anr. v. Kurien K. Kalathil and Ors” reported in (2000) 6 SCC 293 , “State of U.P. and Ors. v. Bridge & Roof Company (India) Ltd.” reported in (1996) 6 SCC 22 and “State of Gujarat through Chief Secretary and Anr. v. Amber Builders” reported in (2020) 2 SCC 540 . 8. The writ petition was dismissed on the ground that the disputed questions of fact are involved inasmuch as whether or not pro rata progress was maintained and whether or not deduction from running bills was justified such issues would involve disputed questions of fact. v. Amber Builders” reported in (2020) 2 SCC 540 . 8. The writ petition was dismissed on the ground that the disputed questions of fact are involved inasmuch as whether or not pro rata progress was maintained and whether or not deduction from running bills was justified such issues would involve disputed questions of fact. The writ Court further held that this shall also be a question of fact whether the delay in completion of the work was attributable to the employer or the contractor. However, in the background of the afore-mentioned discussions by the writ Court in paragraph No. 5, we are inclined to observe that no such findings could have been recorded by the writ Court without taking response of the respondents on affidavit. 9. Admittedly, an affidavit-in-opposition was not filed by the respondents before the writ Court. In the present proceeding, the respondents have endeavored to challenge maintainability of the writ petition and referred to various clauses of the agreement. Now they seem to project a dispute on facts by referring to physical progress report and some disputes between appellant-firm and the local contractors to whom some work was sublet. We are, however, not impressed by these objections for the reason that there is no discussion in the order dated 09th February 2024 regarding any disputed question of fact. On the other hand, the Chief Engineer (Project) in his order dated 9th February 2024 did not even controvert the statements made in the letter for extension of time regarding the difficulties faced by the appellant- firm in executing the subject works under the NIB. 10. While the writ Court was correct in observing that in contractual matters a writ petition shall normally not be entertained, but then, this is not the law of universal application. Wherever it is found that the action of the respondent-authority is arbitrary and whimsical the writ petition under Article 226 of the Constitution of India shall be entertained. In the context of the arbitrary state action even in contractual matters, we are reminded of the judgments in “Jagdish Mandal v. State of Orissa” reported in AIR 2006 SC 645 , and “Mahabir Auto Stores v. Indian Oil Corporation & Ors.” reported in (1990)3 SCC 752 and, more particularly in “ABL International Ltd. & Ors. In the context of the arbitrary state action even in contractual matters, we are reminded of the judgments in “Jagdish Mandal v. State of Orissa” reported in AIR 2006 SC 645 , and “Mahabir Auto Stores v. Indian Oil Corporation & Ors.” reported in (1990)3 SCC 752 and, more particularly in “ABL International Ltd. & Ors. v. Export Credit Guarantee Corporation of India Ltd.” reported in (2004) 3 SCC 553 , wherein the Hon’ble Supreme Court has held as under:- “From the above discussion of ours, following legal principles emerge as to the maintainability of a writ petition:- (a) In an appropriate case, a writ petition as against a State or an instrumentality of a State arising out of a contractual obligation is maintainable. (b) Merely because some disputed questions of facts arise for consideration, same cannot be a ground to refuse to entertain a writ petition in all cases as a matter of rule. (c) A writ petition involving a consequential relief of monetary claim is also maintainable.” 11. We are not inclined to multiply judgments on this issue and would only reproduce what the Hon’ble Supreme Court observed in “Unitech Ltd.” cited by the learned senior counsel for the appellant-firm:- “39.4 If the state instrumentality violates its constitutional mandate under Article 14 to act fairly and reasonably, relief under the plenary powers of the Article 226 of the Constitution would lie. This principle was recognized in ABL International [ABL International Ltd. v. Export Credit Gurantee Corpn. Of India Ltd., (2004) 3 SCC 553 ]: (ABL International case [ABL International Ltd. v. Export Credit Guarantee Corpn. Of India Ltd., (2004) 3 SCC 553 ], SCC p. 572, para 28) “28. However, while entertaining an objection as to the maintainability of a writ petition under Article 226 of the Constitution of India, the court should bear in mind the fact that the power to issue prerogative writs under Article 226 of the Constitution is plenary in nature and is not limited by any other provisions of the Constitution. The High Court having regard to the facts of the case, has a discretion to entertain or not to entertain a writ petition. The Court has imposed upon itself certain restrictions in the exercise of this power. (See Whirlpool Corpn. The High Court having regard to the facts of the case, has a discretion to entertain or not to entertain a writ petition. The Court has imposed upon itself certain restrictions in the exercise of this power. (See Whirlpool Corpn. v. Registrar of Trade Marks [ (1998) 8 SCC 1 ].) And this plenary right of the High Court to issue a prerogative writ will not normally be exercised by the Court to the exclusion of other available remedies unless such action of the State or its instrumentality is arbitrary and unreasonable so as to violate the constitutional mandate of Article 14 or for other valid and legitimate reasons, for which the Court thinks it necessary to exercise the said jurisdiction.” (emphasis supplied) 39.5 Therefore, while exercising its jurisdiction under Article 226, the Court is entitled to enquire into whether the action of the State or its instrumentalities is arbitrary or unfair and in consequence, in violation of Article 14. The jurisdiction under Article 226 is a valuable constitutional safeguard against an arbitrary exercise of State power or a misuse of authority. 39.6 In determining as to whether the jurisdiction should be exercised in a contractual dispute, the Court must, undoubtedly eschew, disputed questions of fact which would depend upon an evidentiary determination requiring a trial. But equally, it is well-settled that the jurisdiction under Article 226 cannot be ousted only on the basis that the dispute pertains to the contractual arena. This is for the simple reason that the State and its instrumentalities are not exempt from the duty to act fairly merely because in their business dealings they have entered into the realm of contract. Similarly, the presence of an arbitration clause does (sic not) oust the jurisdiction under Article 226 in all cases though, it still needs to be decided from case to case as to whether recourse to a public law remedy can justifiably be invoked. 12. We would also indicate that in “BTL EPC Ltd.” the Hon’ble Supreme Court held that judicial interference in contract matters should be restricted to examining arbitrariness or malafide and interference in the writ appeals should be confined to the cases of perversity or error. However, the decision in “BTL EPC Ltd.” pertains to the controversy as regards pre-qualification requirement for bidders. However, the decision in “BTL EPC Ltd.” pertains to the controversy as regards pre-qualification requirement for bidders. In “Kerala State Electricity Board” the Hon’ble Supreme Court held that the matters relating to payment to the contractor on the basis of the minimum wages notification and whether any amount was actually due are the matters for adjudication by a civil Court or an arbitrator. Similarly, “Bridge & Roof Company (India) Ltd.” is an authority to the preposition that the writ Court shall not exercise its extra-ordinary jurisdiction under Article 226 of the Constitution in the face of a provision for arbitration in the agreement. Mr. Sajjan Singh Rathore, the learned Additional Advocate General has laid much emphasis on the judgment in “Amber Builders” to justify deduction of 10% from the running bills payable to the appellant-firm. In “Amber Builders” the issue before the Hon’ble Supreme Court was the power of Arbitral Tribunal to grant interim relief in cases of statutory arbitrations under other Acts, such as, under the Gujarat Act, 1992. In the said case a plea was raised on behalf of the Amber Builders that till the demand of the Government is crystallized or adjudicated upon the Government could not have withheld the money of the contractor and in support of this submission a reference to the judgment in “Gangotri Enterprises Ltd. v. Union of India” (2016) 11 SCC 720 was made. The Hon’ble Supreme Court after examining the previous judgments in “Union of India v. Raman Iron Foundry” (1974) 2 SCC 231 and “H.M. Kamaluddin Ansari v. UOI” (1983) 4 SCC 417 found that the judgment in “Gangotri Enterprises Ltd.” does not hold the field as the decision in “Raman Iron Foundry” was expressly overruled by a three-Judge Bench of the Hon’ble Supreme Court in “H.M. Kamaluddin Ansari”. Just to indicate, in “Raman Iron Foundry” the Hon’ble Supreme Court has affirmed the power of the Government to recover the damages by appropriating any sum which became due to the contractor from the pending bills in other contract. The Hon’ble Supreme Court, however, disagreed with such a view in “Raman Iron Foundry” and held as under: “21…With profound respect we find that the aforesaid observation is incongruous with the proposition of law laid down by this Court just before this observation. The Hon’ble Supreme Court, however, disagreed with such a view in “Raman Iron Foundry” and held as under: “21…With profound respect we find that the aforesaid observation is incongruous with the proposition of law laid down by this Court just before this observation. We find it difficult to agree with the observation of the Court that the impugned order in form and substance being the negative the respondent could refuse to pay such amounts if it thinks it has a valid defence, and if it chooses to do so there would be no breach of the injunction order. 22. It is true that the order of injunction in that case was in negative form. But if an order injuncted a party from withholding the amount due to the other side under pending bills in other contracts, the order necessarily means that the amount must be paid. If the amount is withheld there will be a defiance of the injunction order and that party could be hauled up for infringing the injunction order. It will be a contradiction in terms to say that a party is injuncted from withholding the amount and yet it can withhold the amount as of right. In any case if the injunction order is one which a party was not bound to comply with, the court would be loath and reluctant to pass such an ineffective injunction order. The court never passes an order for the fun of passing it. It is passed only for the purpose of being carried out. In any case if the injunction order is one which a party was not bound to comply with, the court would be loath and reluctant to pass such an ineffective injunction order. The court never passes an order for the fun of passing it. It is passed only for the purpose of being carried out. Once this Court came to the conclusion that the court has power under Section 41 (b) read with Second Schedule to issue interim injunction but such interim injunction can only be for the purpose of and in relation to arbitration proceedings and further that the question whether any amounts were payable by the appellant to the respondent under other contracts, was not the subject-matter of the arbitration proceedings and, therefore, the court obviously could not make any interim order which, though ostensibly in form an order of interim injunction, in substance amount to a direction to the appellant to pay the amounts due to the respondent under other contracts, and such an order would clearly be not for the purpose of and in relation to the arbitration proceedings; the subsequent observation of the Court that the order of injunction being negative in form and substance, there was no direction to the respondent to pay the amount due to the appellant under pending bills of other contracts, is manifestly inconsistent with the proposition of law laid down by this Court in the same case.” 13. This is not that the appellant-firm did not raise any grievance against deduction from its running bills and, in fact, this issue was dealt with by the writ Court with reference to clause-2 of the agreement which provides for the deduction from running bills if pro rata progress is not maintained. However, in the order dated 9th February 2024 (Annexure 10 on page 112 of the writ Court’s record), the Chief Engineer (Project) has simply recorded that: “The Provisional Time Extension for completion of the aforesaid work against above cited award/agreement is granted up to 31.12.2024 to keep the contract alive without prejudice to the terms and conditions of the contract and all right reserved with the department to recover compensation for delay, as admissible.” 14. Under clause 2 of the bid document, the following provision has been made:- “Clause 2: Compensation for delay The time allowed for carrying out the work as entered in the bid, shall be strictly observed by the Contractor and shall be reckoned from the 10th day after the date of written order to commence the work is given to the Contractor. If the Contractor does not commence the work within the period specified in the work order, he shall stand liable for the forfeiture of the amount of Bid Security and Security Deposit. Besides, appropriate action may be taken by the Engineer-in- Charge/competent authority to debar him from taking part in future bids for a specified period or black list him. The work shall, throughout the stipulated period of completion of the contract, be proceeded with all due diligence, time being essence of the contract, on the part of the Contractor. To ensure good progress during the execution of work, the contractor shall be bound, in all cases in which the time allowed for any work exceeds one month (save for special jobs), to complete 1/8th of the whole of the work before 1/4th of the whole time allowed under the contract has elapsed, 3/8th of the work before ½ of such time has elapsed and 3/4th of work before 3/4th of such time has elapsed. If the contractor fails to complete the work in accordance with this time schedule in terms of cost in money, and the delay in execution of work is attributable to the contractor, the contractor shall be liable to pay compensation to the Government at every time span as below:- A. Time Span of Full Stipulated period 1/4th 1/2th 3/4th Full B. Work to be completed in terms of money 1/8th 3/8th 3/4th Full (Rs. ……..) (Rs. ……..) (Rs. ……..) (Rs. ……..) (Rs. ……..) (Rs. ……..) (Rs. ……..) C. Compensation payable by the contractor for delay attributable to contractor at the stage of : Delay up to one fourth period of the prescribed time span – 2.5% of the work remained unexecuted Delay exceeding one fourth period but not exceeding half of the prescribed time span-5% of the work remained unexecuted Delay exceeding half of the prescribed but not exceeding three fourth of the time span – 7.5% of the work remained unexecuted Delay exceeding three fourth of the prescribed time span- 10% of the work remained unexecuted Note: In case delayed period over a particular span is split up and is jointly attributable to Government and contractor, the competent authority may reduce the compensation in proportion of delay attributable to Government over entire delayed period over that span after clubbing up the split delays attributable to Government and this reduced compensation would be applicable over the entire delayed period without paying any escalation. Following illustrations is given:- First time span is 6 months, delay is of 30 days which is split over as under:- 5 days (attributable to Government) + 5 days (attributable to contractor) + 5 days (attributable to Government) + 5 days (attributable to contractor) + 5 days (attributable to Government) + 5 days (attributable to contractor) Total delay is thus clubbed to 15 days (attributable to Government) and 15 days (attributable to contractor). The normal compensation of 30 days as per clause 2 of agreement is 2.5% which can be reduced as 2.5*15/30-1.25% over 30 days without any escalation by competent authority. Note: In case delayed period over a particular span is split up and is jointly attributable to Government and contractor, the competent authority may reduce the compensation in proportion of delay attributable to Government over entire delayed period over that span after clubbing up the split delays attributable to Government and this reduced compensation would be applicable over the entire delayed period without paying any escalation. Following illustrations is given:- First time span is 6 months, delay is of 30 days which is split over as under:- 5 days (attributable to Government) + 5 days (attributable to contractor) + 5 days (attributable to Government) + 5 days (attributable to contractor) + 5 days (attributable to Government) + 5 days (attributable to contractor) Total delay is thus clubbed to 15 days (attributable to Government) and 15 days (attributable to contractor). The normal compensation of 30 days as per clause 2 of agreement is 2.5% which can be reduced as 2.5*15/30-1.25% over 30 days without any escalation by competent authority. Note: The compensation, levied as above, shall be recoverable from the Running Account Bill to be paid immediately after the concerned time span. Total compensation for delays shall not exceed 10 percent of the total value of the work. The contractor shall, further, be bound to carry out the work in accordance with the date and quantity entered in the progress statement attached to the bid. In case the delay in execution of work is attributable to the contractor, the span-wise compensation, as laid down in this clause shall be mandatory. However, in case the slow progress in one time span is covered up within original stipulated period, then the amount of such compensation levied earlier shall be refunded. The Price escalation, if any, admissible under clause 45 of Conditions of Contract would be admissible only on such rates and cost of work, as would be admissible if work would have been carried out in that particular time span. The Engineer-in-Charge shall review the progress achieved in every time span, and grant stage-wise extension in case of slow progress with compensation, if the delay is attributable to contractor, otherwise without compensation. However, if for any special job, a time schedule has been submitted by the Contractor before execution of the agreement, and it is entered in agreement as well as same has been accepted by the Engineer-in-charge, the Contractor shall complete the work within the said time schedule. In the event of the Contractor failing to comply with this condition, he shall be liable to pay compensation as prescribed in forgoing paragraph of this clause provided that the entire amount of compensation to be levied under the provisions of this Clause shall not exceed 10% of the value of the contract. In the event of the Contractor failing to comply with this condition, he shall be liable to pay compensation as prescribed in forgoing paragraph of this clause provided that the entire amount of compensation to be levied under the provisions of this Clause shall not exceed 10% of the value of the contract. While granting extension in time attributable to the Government, reasons shall be recorded for each delay.” 15. Quite apparently, the Chief Engineer (Project) did not even whisper about any laches on the part of the appellant-firm or, that, the delay in execution of the subject work under the NIB was totally attributable to the appellant-firm. The language employed under clause-2 clearly says that there should be a determination and finding recorded by the competent authority that the delay in execution of the work is solely attributable to the contractor. While recording that all rights are reserved with the department to recover compensation for delay, the Chief Engineer (Project) adopted a procedure which seriously violates the written terms of the agreement in question causing serious prejudice to the appellant-firm. This is well remembered that reason is the lifeline of any order, judicial or quasi-judicial. An order which ensues serious civil consequences must conform to the requirements of natural justice. Whereas, the order passed by the Chief Engineer (Project), Public Health Engineering Department (PHED), Jodhpur on 9th February 2024 is bereft of any reasons. Therefore, the latter part of the order dated 9th February 2024 wherein the Chief Engineer (Project) recorded that all rights are reserved with the department to recover compensation for delay, as admissible, is quashed and deductions from the running bills by virtue of the latter portion of the order dated 09th February 2024 are held illegal and arbitrary. The amount so deducted from the running bills allegedly kept in “security head” shall be refunded to the appellant-firm. 16. D.B. Special Appeal Writ No. 835/2024 is allowed in the aforesaid terms.