Delhi High Court
Itc Limited vs Food Corporation Of India on 22 December, 2016
$~17
*IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment delivered on: 22.12.2016
+ W.P.(C) 7145/2015
ITC LIMITED ..... Petitioner
versus
FOOD CORPORATION OF INDIA ..... Respondent
Advocates who appeared in this case:
For the Petitioner :: Mr Arvind Nigam, Senior Advocate with Mr
L.K.Bhushan and Mr Raashi Beri, Advocates.
For the Respondent : Mr Rahul Srivastava, Advocate for FCI.
CORAM:-
HON'BLE MR JUSTICE SANJEEV SACHDEVA
JUDGMENT
22.12.2016
SANJEEV SACHDEVA, J. (ORAL)
1. The petitioner impugns order passed by the High Level
Committee, communicated to the petitioner vide letters dated
18.11.2014 and 27.01.2015, whereby the security deposit of the
petitioner has been forfeited.
2. The respondent had floated a tender for sale of wheat at Food
Supply Depot Mokama, Food Supply Depot Buxar and Food Supply
Depot NRPA, inviting bids from empanelled bulk buyers to lift the
entire quantity of wheat from each of the three Centres.
3. The petitioner participated in the tender and was successful in
its bid for purchase of 2,000 metric tonnes of wheat at Mokama and
1000 metric tonnes of wheat at Buxar.
4. The petitioner deposited an amount of Rs.42,56,250/- towards
Earnest Money Deposit. Letter of allotment was issued to the
petitioners by the respondents on 07.09.2012 approving the delivery
of the aforesaid quantity from the respective Depots. The petitioner
was allocated specified time to lift the entire quantity of wheat.
5. Clause (H) of the Tender stipulated that if the entire stock
could not be lifted due to Force Majeure or due to the operational
constraints of the Food Corporation of India, then the petitioner would
be entitled to refund of all the amount of the unlifted quantity of
wheat.
6. It is an admitted position that the petitioner could not lift the
entire quantity of wheat within the period stipulated.
7. The contention of the petitioner is that there were operational
constraints on the part of the respondent because of which the entire
quantity could not be lifted.
8. Detailed report of non-lifting of the entire wheat stock issued
by the respondents for the respective Depots is as under:-
Food Storage Depot Buxar
S.No. Date No.of Trucks No. of No. of Total Remarks
for which trucks trucks quantity of
programme placed loaded loading (in
was given by the Qts.)
party
1 12/09/12 1 1 1 161,93.875
2 13/09/12 Delivery
postponed as
all staff went to
attend enquiry
at RO, Patna
3 14.09.2012 -Do-
4. 15.09.2012 -Do-
5. 16.09.2012 Sunday
6. 17.09.2012 Viswakarma
Puja - not
loaded
7. 18.09.2012 Date of
delivery
expired
8. 19.09.2012 -Do-
9. 20.09.2012 -Do-
10. 21.09.2012 3 3 3 449.76.500
11. 22.09.2012 5 5 5 920.69.700
12 23.09.2012 Sunday
13 24.09.2012 2 2 0 Due to heavy
pressure of
State
Government
delivery the
same was not
loaded.
14 25.09.2012 --
15. 26.09.2012 --
Total - 1532.40.075
Balance - 8467.59.925
Food Storage Depot Mokama
Sl.No. Date No. of Trucks for No. of No. of trucks Total Remarks
which programme trucks loaded quanti
was given placed by ty of
the party loadin
g (in
Qts.)
1 12.09.2012 03 Trucks 488.32.100 The ITC
2 13.09.2012 04 587.83.00 have been
3 14.09.2012 05 891.50.100 lifted of
4 15.09.2012 10 Trucks 05 897.13.00 balance
quantity
against the
loading RO
No.01/OS
dt.03.09.12
5 16.09.2012 -- -- Sunday
6 17.09.2012 -- -- On the eve of
Viswakarma
puja, no
trucks have
been placed
7 18.09.2012 -- -- The validity
of period of
RO have
been expired
8 19.09.2012 -- -- Extension
order have
been placed
at 4 PM on
19.09.2012.
9 20.09.2012 -- -- Due to called
up of Bharat
Bandh, no
trucks have
been placed
10 21.09.2012 12 10 1576.82.00
11 22.09.2012 12 04 59067.00
12 23.09.2012 -- -- --
13 24.09.2012 15 10 1593.67 Sunday
14 25.09.2012 15 03 448.93050
15 26.09.2012 10 03 494.95.00
9. Perusal of the report of the Depot at Buxar shows that the
period of delivery was from 12.09.2012 to 18.09.2012. On
12.09.2012, the number of trucks for which programme was issued
was one and the petitioner placed one truck for lifting of the load.
However, on 13.09.2012 to 15.09.2012, delivery was postponed as the
entire staff of the respondent went to attend inquiry at RO, Patna,
16.09.2012 was a Sunday, on which date lifting was not permitted.
On 17.09.2012, lifting was not permit as it was Vishwakarma Day.
On 18.09.2012, no programme was issued by the respondent as the
time expired.
10. Extension was granted to the petitioner and accordingly, a
programme was issued for placement of three trucks on 21.09.2012
and five trucks on 29.09.2012, which was complied with by the
petitioner and appropriate load was lifted, 23.09.2012 being a
Sunday, load was not permitted to be lifted. On 24.09.2012,
programme was issued for placement of two trucks, which was duly
complied with by the petitioner, however, load was not permitted to
be lifted because of heavy pressure of State Government. Thereafter
on 25.09.2012 and 26.09.2012, no programme was issued and no load
could be lifted by the petitioner.
11. With regard to the report for the Mokama Depot, the period for
lifting of load was from 12.09.2012 to 17.09.2012. The petitioner was
able to lift part of the load, however, 16.09.2012 being Sunday, load
could not be lifted. 17.09.2012, on the eve of Vishwakarma Day, no
programme was issued and no load could be lifted.
12. Extension was granted late in the evening of 19.09.2012,
however, on 20.09.2012 and 21.09.2012, because of Bharat Bandh,
only part of the load could be lifted. On 22.09.2012 some load was
lifted. 23.09.2012 again being a Sunday, no load was permitted to be
lifted. Thereafter, on 24.09.2012, 25.09.2012 and 26.09.2012, though
some load was lifted, however, the entire load was not lifted because
of operational difficulties.
13. By letter dated 08.05.2013, the General Manager, Regional
Officer, Patna, informed the Executive Director, Food Corporation of
India, Zonal Office, Kolkata that non-lifting of food grain was due to
Force Majeure as well as operational difficulties of Food Corporation
of India. The General Manager recommended refund of the cost of
the unlifted quantity for both the Depots.
14. It is an admitted position that the said amount has been
refunded.
15. The issue pertains to only the forfeiture of the security deposit
and its refund.
16. The reports of the two Depots clearly show that there were
operational difficulties on the part of Food Corporation of India. Even
the General Manager of the respondents, in his letter dated
08.05.2013, has admitted that non-lifting of the food grain was due to
Force Majeure as well as operational difficulties of the Food
Corporation of India. Consequent thereto, the entire cost of unlifted
quantity has been refunded to the petitioner.
17. Since the security deposit was deposited for the purposes of
furtherance of the contractual terms and the respondents themselves
have admitted, that petitioner could not lift the stock because of
operational difficulties and Force Majeure conditions, the petitioner
cannot be held liable for any breach for not complying with the terms
and conditions of the Contract.
18. The respondents have themselves refunded the entire cost of
unlifted stock because of Force Majeure conditions and their own
operation difficulties. This amounts to an admission on the part of the
respondents that the petitioner is not at fault or in breach of any of the
condition of not lifting the entire stock.
19. Since the petitioner is not in breach of the said tender condition
due to Force Majeure conditions and the operational difficulties on
the part of the Respondents, the respondents could not have forfeited
the Security Deposit, which was given solely for the purposes of
ensuring compliance of the terms and conditions of the Contract.
20. In view of the above, the action of the respondent in forfeiting
the security deposit cannot be sustained. The same is accordingly
quashed.
21. The respondents are directed to refund the security deposit of
Rs. 42,56,250/- within a period of four weeks, failing which the
respondents shall be liable to pay simple interest at the rate of 9% per
annum till the refund is made in full.
22. The Writ Petition is accordingly disposed of.
23. Dasti under signatures of the Court Master.
SANJEEV SACHDEVA, J
DECEMBER 22, 2016
'Sn'
