Delhi High Court
Ivs Global Services Pvt. Ltd. vs Union Of India & Ors on 13 September, 2018
$~54
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 8126/2016 & CM Nos. 33623/2016 & 37301/2018
IVS GLOBAL SERVICES PVT. LTD. ..... Petitioner
Through: Mr Sukant Vikram, Mr Apurv
Chandola, Mr Tuba Mohdi and Mr
Jayant Mehta, Advocates.
versus
UNION OF INDIA & ORS ..... Respondents
Through: Mr Ripu Daman Bhardwaj, CGSC
with Mr T. P. Singh, Advocate for
UOI.
Mr Arun Sanwal, Advocate for R-
4/OBC.
CORAM:
HON'BLE MR. JUSTICE VIBHU BAKHRU
ORDER
% 13.09.2018
VIBHU BAKHRU, J
1. The petitioner has filed the present petition, inter alia, praying as
under:-
"(i) Call for the records of the case;
(ii) Issue a writ of Mandamus or any other like writ,
order or direction in the nature thereof quashing the
impugned order dated 07.09.2016 issued by Respondent
no.2 by e-mail.
(iii) Issue a writ of Prohibition or any other like writ,
order or direction in the nature thereof restraining the
encashment of the Bank Guarantee bearing
No.10450039001 dated 26.02.2015 issued by the
Respondent No.4 for an amount of JPY 41,25,000 on
the basis of the Impugned Order dated 07.09.2016."
2. The disputes involved in the present petition arise in the context of an
agreement dated 27.02.2015 (hereafter „the Agreement‟) entered into
between the petitioner and respondent no.1 (Ministry of External Affairs),
whereby the petitioner agreed to provide Visa Support Services to the
Embassy of India, Tokyo (respondent no.3). In terms of Paragraph 6 of the
Agreement, the petitioner furnished three bank guarantees, which included a
Performance Bank Guarantee (PBG) for JPY 4.125 million. Clause 6(b) of
the Agreement, in terms of which the said PBG was furnished, is set out
below:-
"6. BANK GUARANTEES
xxxx xxxx xxxx
(b) The Service Provider shall provide a performance
Bank Guarantee fixed at JPY 4.125 million i.e., 2% of
annual expected visa revenue of Government, as per
services outsourced, based on the preceding twelve
months or US$20,000 whichever is higher, for penalties
due as explained under Para 17(iii)-Operational Penalties
of this Agreement."
3. The allegation against the petitioner is that during the period
10.08.2016 to 25.08.2016, the petitioner had unauthorisedly collected
courier charges at the rate of JPY 730/- per application from various agents.
Whereas, according to the petitioner, it was authorised to charge the same;
the respondents claim that the said charges were unauthorized and were
collected compulsorily.
4. In the aforesaid context, respondent no.2 had issued a show cause
notice dated 12.08.2016 calling upon the petitioner to explain as to why
action should not be taken against the petitioner for collecting courier
charges from various travel agents.
5. The petitioner responded to the said show cause notice by a letter
dated 24.08.2016.
6. The petitioner, inter alia, claimed that in terms of Clause 2(iii) and
2(xiv) of the Agreement, the petitioner was entitled to collect the charges of
JPY 730/- per application and this was to securely the delivery of the
documents in question. The petitioner further claims that the said charges
were paid voluntarily by the applicants.
7. The explanation furnished by the petitioner was not accepted by
respondent no.2 and by an order dated 07.09.2016 (the impugned order), the
petitioner was called upon to deposit an amount of JPY 41,58,810/-. The
respondents also invoked the Performance Bank Guarantee (PBG) furnished
by the petitioner in terms of clause 6(b) of the Agreement.
8. Aggrieved by the same, the petitioner filed the present petition.
9. After the petition was filed, respondent no.2 sent a letter dated
12.10.2016 providing a detailed response to the petitioner‟s reply to the
show cause notice (dated 12.08.2016). This Court is informed that the
petitioner has also sent a communication dated 16.02.2017 countering the
contents of the said letter and the note appended thereto.
10. It is also relevant to mention that the order dated 07.09.2016 (the
impugned order) is cryptic and does not deal with the explanations that were
advanced by the petitioner, in its reply dated 24.08.2016. This was also
noted by this Court in the order dated 15.09.2016. It is obvious that the
purpose of sending the letter dated 12.10.2016 by respondent no.2 was to
supplant the reasons for passing the order dated 07.09.2016.
11. It is well settled that an authority cannot provide reasons to support an
order, which does not reflect the same (See: Mohinder Singh Gill v. Chief
Election Commissioner: (1978) 1 SCC 405). In this view, this Court was
inclined to set aside the impugned order and remand the matter for
consideration afresh. However, on reflection, this Court does not consider it
apposite to do so. This is for the reason that respondent no.2 had clearly
indicated their stand in the note annexed to the letter 12.10.2016 and little
purpose would be served by remanding the matter. More importantly, the
dispute involved in the present petition is, essentially, a contractual dispute.
The same can be resolved either amicably (as provided under Clause 16 of
the Agreement) or by adjudication in an appropriate proceedings. It would
not be apposite for this Court to examine the disputes in this case, as it
involves disputed questions of fact. Further, the subject dispute is a matter of
private law and there is no element of public law involved in the present
petition (See: Joshi Technologies International Inc. v. Union of India &
Ors.: (2015) 7 SCC 728).
12. At this stage, it is also necessary to observe that the law relating to
interdiction of bank guarantee is now well settled and unless it is established
that there is fraud of egregious nature, the Courts would not interdict
invocation of a bank guarantee (See: Svenska Handelsbanken v. M/s.
Indian Charge Chrome and Others: (1994) 1 SCC 502 and Larsen &
Toubro Limited v. Maharashtra State Electricity Board and Others: (1995)
6 SCC 68.)
13. In view of the above, the present petition is dismissed. In the event,
parties are unable to resolve the disputes amicably, it will be open for the
petitioner to file appropriate proceedings in accordance with law.
14. It is also clarified that this Court has not examined the question
regarding the return of other bank guarantees (other than the PBG for JPY
4.125 million, furnished in terms of clause 6(b) of the Agreement) furnished
in terms of the Agreement, as the same are not subject matter of the present
petition. It would be open for the petitioner to file appropriate proceedings in
that regard.
15. The pending applications stand disposed of.
VIBHU BAKHRU, J
SEPTEMBER 13, 2018
MK
