JUDGMENT : Devashis Baruah, J. Heard Mr. M Biswas, the learned counsel appearing on behalf of the petitioner. Mr. SK Medhi, the learned CGC appears on behalf of the respondents. 2. The present writ petition has been filed challenging the communication dated 18.07.2022, whereby the respondent authorities, more particularly, the respondent No.3, had terminated the contract with a penalty of 10%. For the purpose of deciding the dispute, this Court finds it pertinent to take note of the relevant facts, which led to the filing of the present writ petition. 3. A perusal of the records reveal that the respondent authorities had issued a Notice Inviting Tender (NIT) on 06.12.2021 inviting bids for the purpose of manufacture and supply of Elastic Rail Clip (for short, ERC) Marked-V as per RDSO’ Drg.No.T-5919 confirming to IRS Specification for ERC T-31-2018 (Fourth Revision) and as amended up to date of opening. The said NIT had various clauses. For the purpose of the instant writ petition, it is pertinent to take note of some of the clauses. Clause 1.1 of the Instructions to the E-Tenderers stipulates that the tenderers have to carefully go through the instructions and all conditions as mentioned in paragraph 1.3 & 1.4 appended therein and by submitting the quotation, they undertake to abide by all types of conditions at paragraph 1.4. It was also stipulated that the tenderer’s digital signature on the e-Tender form will be considered as their confirmation, unless specific deviation is quoted in the techno- commercial offer form. The said Clause 1.1 of the Instructions to E-Tenderers being relevant is reproduced hereinunder: “1.1. The tenderers are requested to carefully go through these Instructions and all the Conditions as mentioned in para 1.3 & 1.4 appended herein below. By submitting the quotation, they undertake to abide by all types of conditions at para 1.4. The tenderer’s digital signature on the e-Tender form will be considered as their confirmation that they have read and accepted all the conditions laid down in the documents as well as tender schedule, comprising of techno-commercial offer form (including Special Conditions of Contracts for e-Procurement of Track Fittings, attached to e-Tender) and Financial offer form, unless specific deviation is quoted in the techno-commercial offer form.” 4. It is further pertinent to mention that the tender documents included a set of conditions in the name and style of “Special Conditions of Contract for E- procurement of Track Fittings” (for short, “the SCC”). Clause 26 of the said SCC refers to the Deviation Clause. The said clause being relevant is reproduced hereinunder: “26. Deviation Clause: In case intending Tenderer desires to quote deviation from the tender condition, the Tenderer should attache deviation sheet along with his offer and should indicate the cost of withdrawal of each such deviation sheet quoted by him. In cases, where the Firm does not submit any deviation sheet, it will be taken that the Firm has accepted all the terms & Conditions as per Tender Conditions.” 5. A perusal of the above-quoted clause would show that liberty was given to the tenderers to quote deviation from the tender conditions. However, in order to do so, the tenderer must attach deviation sheet along with his offer. 6. Another clause which has relevance for the purpose of the present dispute is Clause 25 of the SCC which is the price variation clause. In terms with the said price variation clause, it is stipulated that any offer with a different PVC formula or quoting different base month or linkage with different indices or fixed rate etc. as compared to the PVC formula provided in the tender would be summarily rejected. The said Clause 25 being relevant is reproduced hereinunder: “25. Price Variation clause: PVC formula for various track fittings with base year 2011-12 as issued by Railway Board vide Letter No. 2017/TK-II/22/1/1 dated 27.11.2017 are as under: Any offer with different PVC formula or quoting different base month or linkage with different indices or fixed rate etc. as compared to PVC formula provided in the tender will be summarily rejected. Base month for PYC formula shall be taken as the month just preceding the month of the date of the opening of the tender. However, in case of tender finalised on negotiation, the base month of the PVC will be the month just preceding the month of negotiation.” 7. It is, however, very apposite to mention that the perusal of the SCC also shows that different price variation formula have been stipulated in reference to different types of works/supply. However, in case of tender finalised on negotiation, the base month of the PVC will be the month just preceding the month of negotiation.” 7. It is, however, very apposite to mention that the perusal of the SCC also shows that different price variation formula have been stipulated in reference to different types of works/supply. As the contract in question pertains to manufacture and supply of ERC, the price variation formula mentioned therein is at Clause 25.5 which being relevant is reproduced hereinunder: “25.5 All Types of ERCs P1=[(P0/100)x{10+(27.48xA1/AO)+(12.72xB1/B0)+(24.80xC1/C0)+(17xL1/L0) +(8xF1/F0)}] Where, P1 = Escalated/de-escalated basic unit rate PO = Accepted basic unit rate A1= Wholesale Price Index for “ Inputs into Steel Making” as prevalent at the time of 10 days prior to call of inspection of ERCs (finished goods) as per Economic Advisor, Ministry of Industry web site http://eaindustry.nic.in as per series 2011-12. AO = Wholesale Price Index for “ Inputs into Steel Making” as prevalent during the month just preceding the month in which tender was opened, as per Economic Advisor, Ministry of Industry web site http://eaindustry.nic.in as per series 2011-12. B1= Wholesale Price Index for “ Metallic Iron” as prevalent at the time of 10 days prior to call of inspection of ERCs (finished goods) as per Economic Advisor, Ministry of Industry web site http://eaindustry.nic.in as per series 2011-12. BO = Whole Sale Price Index for “ Metallic Iron” as prevalent during the month just preceding the month in which tender was opened, as per Economic Advisor, Ministry of Industry web site http://eaindustry.nic.in as per series 2011-12. C1= Wholesale Price Index for “ Mild Steel-Semi Finished Steel” as prevalent at the time of 10 days prior to call of inspection of ERCs (finished goods) as per Economic Advisor, Ministry of Industry web site http://eaindustry.nic.in as per series 2011-12. CO = Wholesale Price Index for “ Mild Steel-Semi Finished Steel” as prevalent during the month just preceding the month in which tender was opened, as per Economic Advisor, Ministry of Industry web site http://eaindustry.nic.in as per series 2011-12. F1= Wholesale Price Index for “ Fuel & Power” as prevalent at the time of 10 days prior to call of inspection of ERCs (finished goods) as per Economic Advisor, Ministry of Industry web site http://eaindustry.nic.in as per series 2011-12. F1= Wholesale Price Index for “ Fuel & Power” as prevalent at the time of 10 days prior to call of inspection of ERCs (finished goods) as per Economic Advisor, Ministry of Industry web site http://eaindustry.nic.in as per series 2011-12. FO = Wholesale Price Index for “ Fuel & Power” as prevalent during the month just preceding the month in which tender was opened, as per Economic Advisor, Ministry of Industry web site http://eaindustry.nic.in as per series 2011-12. L1 = All India Consumer Price Index for Industrial workers as prevalent at the time of 10 days prior to call of inspection of ERCs (finished goods) as per Labour Bureau, Ministry of Labour website http://labourbureau.nic.in. L0 = All India Consumer Price Index for Industrial workers as prevalent during the month just preceding the month in which tender was opened, as per Labour Bureau, Ministry of Labour website http://labourbureau.nic.in.” 8. The petitioner being interested in the contract in question submitted its bid on 27.12.2021 along with the statement of deviation. The deviations which were sought for are as under: Sl. No. Clause Description 01 Delay in Inspection : If there is any delay in inspection beyond the 07 days from the date of submission of our call the delayed period shall be counted to Railway’s account and DP should be re- fixed accordingly. 02 Non availability of raw Material by Rashtriya Ispat Nigam Ltd. : In case of non-availability of Raw Material from RINL during the currency of the contract since our offer is based on the approval of RINL as an Approved Vendor 23 mm dia Spring Steel Round Gr.55Si7 and if there is any delay for execution of the contract, such delay will be Railway’s account and DP should be re-fixed accordingly. We shall not be able to supply the materials within the DP until or unless the raw material is manufactured and supplied by RINL on regular basis since ERC manufacturers are only dependent on RINL for procurement of raw material. 9. We shall not be able to supply the materials within the DP until or unless the raw material is manufactured and supplied by RINL on regular basis since ERC manufacturers are only dependent on RINL for procurement of raw material. 9. The materials on record further show that at the time of submission of the bid, the petitioner had quoted 4.5% as the GST, but later on vide the communication dated 30.12.2021, the petitioner submitted that the prevailing rate is 18% of the GST and further submitted that the offer made by the petitioner should be taken as the price quoted along with 18% of the GST and not 4.5%. 10. On 01.04.2022, a letter of acceptance was issued to the petitioner, wherein there is no mention as regards the acceptance of the deviations as sought for by the petitioner. However, it was duly mentioned in terms with Clause 14.1(a) (iii) of the tender document that if the tenderer misclassifies the goods under the relevant GST Rules, Railway will not pay increased GST due to misclassification. A further perusal of the letter of acceptance would show that the price variation formula which was, otherwise, mandated in Clause 25.5 of the SCC was changed, whereby the factors on the basis of which the price variation formula were worked out was changed. A detailed reading of the price variation formula as stipulated in Clause 25.5 of the SCC with that of the price variation formula mentioned in the letter of acceptance would show that the manner in which the factors A1, B1, C1, F1, L1 were to be computed were changed. 11. The petitioner immediately upon receiving the letter of acceptance vide a communication dated 04.04.2022 informed the respondent No.2 that the letter of acceptance dated 01.04.2022 cannot be said to be a letter of acceptance, but it is rather a counter offer and hence, it was rejected. 12. The record further reveals that inspite of the communication dated 04.04.2022, the respondents issued the purchase order on 27.04.2022 directing the petitioner to supply 4,80,000 quantity of the ERC. It further appears from a perusal of the purchase order that the price variation formula mentioned therein was in terms with the letter of acceptance and not in terms with the Clause 25.5 of the SCC. 13. It further appears from a perusal of the purchase order that the price variation formula mentioned therein was in terms with the letter of acceptance and not in terms with the Clause 25.5 of the SCC. 13. The record further reveals that the petitioner upon receipt of the said purchase order issued a communication dated 12.05.2022 giving detailed reasons that there was no formation of a contract and it was illegal and arbitrary on the part of the respondent authorities to impose certain conditions which were unilateral, without the acceptance of the petitioner. 14. The respondent authorities replied on 15.06.2022, wherein there was no mention that the deviation sought for by the petitioner were accepted, but rather insisted on Clause 1.1 of the Instruction to e- Tenderers and further mentioning that if petitioner did not make the supply, the contract would be terminated by imposing a penalty of 10%. 15. The petitioner again submitted a representation on 22.06.2022, but the request so made in the representation was not heeded to. On the other hand, vide the impugned communication dated 18.07.2022, the contract with the petitioner was terminated and the petitioner was imposed a penalty of 10% of the value of the stores not supplied. It is under such circumstances, the petitioner is before this Court. 16. The record reveals that this Court vide an order dated 10.08.2022 issued notice and further stayed the operation of the impugned letter dated 18.07.2022 until further orders. 17. An affidavit-in-opposition was filed by the respondents wherein for the first time, it was mentioned that the petitioner's deviation was duly taken into account and the petitioner being the L1 bidder, the contract was awarded to the petitioner. There is nothing mentioned as regards the change in the price variation formula in Clause 25.5 of the SCC in the letter of acceptance. It was further mentioned in the affidavit that the respondent authorities issued the letter of acceptance (LOA) on 01.04.2022 before it expired on 26.04.2022 and in the letter of acceptance, it was clearly mentioned that the contract was concluded and formal purchase order would follow. It was further mentioned that the petitioner having quoted the offer and the order having been placed to the petitioner, it automatically entered into a binding contract and the petitioner firm was bound to supply the materials within the date of delivery period. 18. It was further mentioned that the petitioner having quoted the offer and the order having been placed to the petitioner, it automatically entered into a binding contract and the petitioner firm was bound to supply the materials within the date of delivery period. 18. I have heard the learned counsels appearing on behalf of the petitioner and have perused the materials on record. 19. From the materials on record, it is apparent that the respondent authorities by issuing the NIT had invited bids from all interested bidders for the manufacture and supply of ERC. The materials on record further show that as per the terms and conditions of the Invitation of Bids made by the respondent authorities which included liberty being given to the bidders to submit bids with deviation, the petitioner submitted the bid with deviations as already mentioned in the previous segments of the instant judgment. The record further reveals that on 01.04.2022, the respondent No.3 had issued the letter of acceptance, wherein there is no mention as regards the deviations which were sought for by the petitioner. Additionally, the price variation formula as was mandated in Clause 25.5 of the SCC was changed. 20. The question, therefore, arises is as to whether the issuance of the letter of acceptance can be said to have resulted in a contract. 21. For the purpose of the same, this Court finds it pertinent to take note of some of the provisions of the Indian CONTRACT ACT 1872 (for short, “the Act of 1872”). Section 2 of the Act of 1872 is the interpretation clause and gives in a vivid manner as to how a formation of a contract takes place. Section 2 of the Act of 1872 being relevant is reproduced hereinunder: “2. Interpretation-clause.—In this Act the following words and expressions are used in the following senses, unless a contrary intention appears from the context:— (a) When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to such act or abstinence, he is said to make a proposal; (b) When the person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted. A proposal, when accepted, becomes a promise; (c) The person making the proposal is called the “promisor”, and the person accepting the proposal is called the “promisee”; (d) When, at the desire of the promisor, the promisee or any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such act or abstinence or promise is called a consideration for the promise; (e) Every promise and every set of promises, forming the consideration for each other, is an agreement; (f) Promises which form the consideration or part of the consideration for each other are called reciprocal promises; (g) An agreement not enforceable by law is said to be void; (h) An agreement enforceable by law is a contract; (i) An agreement which is enforceable by law at the option of one or more of the parties thereto, but not at the option of the other or others, is a voidable contract; (j) A contract which ceases to be enforceable by law becomes void when it ceases to be enforceable.” 22. In the backdrop of the above provisions quoted and applying to the facts of the instant case, it would be seen that the respondent authorities by issuance of the NIT containing various terms and conditions had invited offers from eligible bidders for the purpose of manufacture and supply of ERC. 23. The petitioner herein on the basis of the said invitation of the offer vide the NIT dated 06.12.2021 submitted the bid on 27.12.2021 stipulating certain deviations as has been already mentioned hereinabove. At this stage, this Court finds it very pertinent to take note of Section 7 of the Act of 1872, which is a provision dealing with when a proposal can be converted into a promise. The said section being relevant is reproduced herein under: “ 7. Acceptance must be absolute.— In order to convert a proposal into a promise the acceptance must— (1) be absolute and unqualified; (2) be expressed in some usual and reasonable manner, unless the proposal prescribes the manner in which it is to be accepted. The said section being relevant is reproduced herein under: “ 7. Acceptance must be absolute.— In order to convert a proposal into a promise the acceptance must— (1) be absolute and unqualified; (2) be expressed in some usual and reasonable manner, unless the proposal prescribes the manner in which it is to be accepted. If the proposal prescribes a manner in which it is to be accepted, and the acceptance is not made in such manner, the proposer may, within a reasonable time after the acceptance is communicated to him, insist that his proposal shall be accepted in the prescribed manner, and not otherwise; but, if he fails to do so, he accepts the acceptance.” 24. Now applying the said provisions to the facts of the instant case, it would be seen that the petitioner herein had submitted a proposal pursuant to the invitation of the offers containing various terms and conditions. The proposal so submitted as already stated was subject to certain deviations as sought for. However, while accepting the same, vide the issuance of the letter of acceptance dated 01.04.2022 by the respondent authorities, the deviation sought for were not mentioned to have been accepted. It is also very pertinent to observe that in the letter of acceptance the respondents have changed the terms pertaining to price variation formula, which was mentioned in Clause 25.5 of the SCC. The act on the part of the respondents, therefore, to change the term of the invitation of the offer by incorporating it in the letter of acceptance dated 01.04.2022 can at best be said to be a counter offer being given by the respondents to the petitioner. It is further seen that the petitioner having noticed that the deviation so sought for having not been accepted in the letter of acceptance dated 01.04.2022 and further the respondents having changed the price variation formula vide the communication dated 04.04.2022 refused the letter of acceptance. The refusal of the letter of acceptance by the petitioner, in the opinion of this Court, that too, within a period of 3(three) days from the date of issuance of the letter of acceptance, could not have resulted in a concluded contract. The refusal of the letter of acceptance by the petitioner, in the opinion of this Court, that too, within a period of 3(three) days from the date of issuance of the letter of acceptance, could not have resulted in a concluded contract. Fortiori, therefore, is that the respondent authorities could not have issued the purchase order on 27.04.2022, without there being a concluded contract and even if such purchase order was issued, the said purchase order could not have bound the petitioner to make the supply after the petitioner refused the letter of acceptance. 25. The logical conclusion to the above analysis is that as there was no concluded contract, the purchase order dated 27.04.2022 could not have bound the petitioner. Under such circumstances, the question of termination of such unconcluded contract or imposition of penalty vide the impugned communication dated 18.07.2022 was not permissible under the law. 26. Accordingly, the instant writ petition, therefore, stands disposed of with the following observation(s) and direction(s): (i). There was no concluded contract by and between the petitioner as well as the respondents in respect to the NIT dated 06.12.2021. (ii). The impugned communication dated 18.07.2022 is contrary to the settled principles of law and, accordingly, stands set aside and quashed. (iii). There shall be no order as to costs.