M/S Hems Corporation vs South Eastern Coalfield Limited
2022 Latest Caselaw 3652 Chatt

              HIGH COURT OF CHHATTISGARH, BILASPUR
                               WPC No. 1292 of 2022
 M/s Bharat Construction Through its Proprietor, Ramakant Sharma, Aged About 62
  Years, S/o Late Shri Shyam Dev Sharma, R/o LIG 223, Shivaji Nagar, Tahsil and
  District Korba (C.G.)
                                                                           ---- Petitioner
                                       Versus
1. South Eastern Coalfield Limited, through its Chairman Cum Managing Director, Seepat
   Road Bilaspur (C.G.)
2. Chief Manager, (E & M), South Eastern Coalfield Limited, Gevra Project, Distt. Korba
   (C.G.)
3. General Manager (E & M), South Eastern Coalfield Limited, Gevra Project, Distt. Korba
   (C.G.)
4. M/s Nagarjuna Engineering Constructions, Address 5th Floor, Flat No. 306, Vellanki
   Constructions, Besides Srinagar Colony Bus Stop, Srinagar Gajuwaka,
   Visakhapatanam Andhra Pradesh 530026
                                                                       ---- Respondents

WPC No. 1316 of 2022  M/s Aarna Construction (JV) through its Partner, Subhash Agrawal, Aged About 46 Years, S/o Shri Mahavir Prasad Agrawal, R/o A 104, Anant Emegine Purana Bus Stand, Tahsil and District Korba, Chhattisgarh., District : Korba, Chhattisgarh

---- Petitioner Versus

1. South Eastern Coalfield Limited, through its Chairman cum Managing Director, Seepat Road Bilaspur, Chhattisgarh., District : Bilaspur, Chhattisgarh

2. Chief Manager (E & M), South Eastern Coalfield Limited, Gevra Project, District Korba, Chhattisgarh., District : Korba, Chhattisgarh

3. General Manager (E & M) South Eastern Coalfield Limited, Gevra Project, District Korba, Chhattisgarh., District : Korba, Chhattisgarh

4. M/s Nagarjuna Engineering Constructions, Address 5th Floor, Flat No. 306, Vellanki Constructions, Besides Srinagar Colony Bus Stop, Srinagar Gajuwaka, Visakhapatanam Andhra Pradesh 530026.

---- Respondents WPC No. 1344 of 2022  M/s Hems Corporation through its Proprietor, Hariket Gupta, Aged About 49 Years, S/o Shri Kashi Nath Gupta, R/o LIG 38, Sharda Vihar, Tahsil and District Korba Chhattisgarh, District : Korba, Chhattisgarh

---- Petitioner Versus

1. South Eastern Coalfield Limited, through its Chairman cum Managing Director, Seepat Road, Bilaspur Chhattisgarh, District : Bilaspur, Chhattisgarh

2. Chief Manager, (E & M), South Eastern Coalfield Limited, Gevra Project, District Korba Chhattisgarh, District : Korba, Chhattisgarh

3. General Manager (E & M) South Eastern Coalfield Limited, Gevra Project, District Korba Chhattisgarh, District : Korba, Chhattisgarh

4. M/s Nagarjuna Engineering Constructions, Address 5th Floor, Flat No. 306, Vellanki Constructions, Besides Srinagar Colony Bus Stop, Srinagar Gajuwaka, Visakhapatanam Andhra Pradesh 530026, District : Visakhapatnam, Andhra Pradesh

---- Respondents

26/05/2022 Shri Anand Shukla, Advocate on behalf of Shri Parag Kotecha, Advocate for the petitioners.

Shri Pankaj Agrawal, Advocate for respondents No.1 to 3/SECL. Heard on the prayer for grant of interim relief.

It is submitted that in each of these cases, a Notice Inviting Tender (NIT) for the works specified was issued. The petitioners in all these three cases submitted their bids, which were L1. Accordingly the agreements were entered for the works assigned and the duration of the agreements was 365 days. Subsequent to this agreement with the petitioners, fresh tender notice has been issued for the same work on 20-10-2021, which is under challenge in these petitions. In subsequent development the respondent authorities have issued a letter dated 21-05-2022, copy of which is filed as Annexure-PR/1, directing foreclosure of the works assigned to the petitioners giving time of 15 days from the date of issuance of the notice.

It is submitted that the petitioners had no opportunity of hearing before the order of foreclosure was issued and there is no specific reason assigned in the order dated 21-05-2022. Further, this order has also not been issued by the authorized person. It is submitted that according to clause 10.1 and 10.2 of the terms and conditions of the NIT there is procedure for termination of contract which has not been followed and clause 10.4 of the same NIT mentions that the contractor shall be given notice in writing before passing order for foreclosure. Hence, the order of foreclosure dated 21-05-2022 is illegal. Therefore, the interest of the petitioners be protected by passing interim order.

On behalf of the petitioners reliance has been placed on the judgment of Hon'ble the Supreme Court in the matter of State of Uttar Pradesh Vs. Sudhir Kumar Singh and others, AIROnline 2020 SC 773.

Learned counsel appearing for respondent SECL opposes the submission and submits that the petitions have become infructuous, as the reliefs claimed in the petitions are no longer fit to be considered. It is submitted that the work order has been issued to respondent No.4 on the basis of the second Notice Inviting Tender and no stay has been granted by this Court on earlier dates. It is submitted that in the work order itself, there is clause present by which the management reserved all the right to foreclose the work at any premature stage and further clause 10.4 of the NIT also empowers the respondent SECL to pass order for foreclosure. It is also submitted that in case the petitioners have any grievance, there is Arbitration clause present in the terms and condition of the NIT which can be invoked by the petitioners. It is submitted that the petitioners had knowledge of issuance of the second NIT and its consequences, even then the petitioners entered into the agreement subsequent to the issuance of the second NIT. It is also submitted that the order of the foreclosure has been passed by the authority which is authorized under the definition clause defining Engineer-in-Charge. Therefore, there is no illegality in the order dated 21-05-2022. The prayer for interim relief be rejected.

Considered on the submissions. The clause 10.4 of the NIT provides that if at any time after acceptance of the tender, the company decides to abandon or reduce the scope of work for any reason whatsoever the company, through its Engineer-in- Charge, shall give notice in writing to that effect to the contractor and contractor shall act accordingly in the matter. It is further provided that in the event of abandonment, the contractor shall have no claim etc. Clause 10.4 of the NIT does not provide for opportunity of any hearing before any order for foreclosure is passed. In such a case the person affected, i.e., the contractor has remedy to invoke Arbitration clause. Hence, in such circumstances this Court does not feel inclined to grant any interim relief to the petitioners. Hence, the prayer for grant of interim relief is rejected.

List these cases before regular Bench after summer vacation.

Sd/-

(Rajendra Chandra Singh Samant) Vacation Judge Aadil