Manu Electricals Pvt. Ltd vs Indian Oil Corporation Ltd.
2021 Latest Caselaw 393 Del

                                                                                         Signature Not Verified
                                                                                         Digitally Signed By:DINESH
                                                                                         SINGH NAYAL
                                                                                         Signing Date:06.02.2021
                                                                                         22:47:53


                                $~21
                                *    IN THE HIGH COURT OF DELHI AT NEW DELHI
                                                                     Date of Decision: 5th February, 2021
                                +      W.P.(C) 1484/2021 & CM APPLs. 4278/2021, 4279/2021
                                     MANU ELECTRICALS PVT. LTD.                           ..... Petitioner
                                                        Through: Mr. Sanjay Agarwal & Ms. Santwana
                                                                    Agarwal, Advocates (M-9810130855)
                                                        versus
                                     INDIAN OIL CORPORATION LTD.                       ..... Respondent
                                                        Through: Ms. Mala Narayan, Mr. Neha Dawar
                                                                    & Mr. Shashwat Goel, Advocates for
                                                                    IOCL. (M-9811017666)
                                     CORAM:
                                     JUSTICE PRATHIBA M. SINGH
                                Prathiba M. Singh, J. (Oral)

1. This hearing has been done through hybrid mode (physical and virtual hearing)

2. The present petition challenges the letter dated 25th October, 2019 issued by the Chief General Manager (Engg.), Indian Oil Corporation Ltd. (hereinafter 'IOC') vide which, the Petitioner's tender bearing no. RCC/NR/DSO/ENG/PT-159/2016-17 for supply, installation, testing and commissioning of energy efficient LED lighting at Ambala terminal under Delhi and Haryana State office, has been terminated and the Petitioner has been put on a holiday list for a period of one year with effect from 24th October, 2019.

3. The Petitioner was awarded the said tender vide acceptance letter dated 27th March 2017 and was given the work order vide letter dated 19th April 2017. The Petitioner had in turn engaged one M/s Virex Energy Pvt. Ltd. - Respondent No.2 for effecting the supplies and for taking care of the manufacturing defects of the products.

4. The case of the Petitioner is that due to breaches by Respondent No.2,

Signature Not Verified Digitally Signed By:PRATHIBA M SINGH Signing Date:06.02.2021 12:40 Signature Not Verified Digitally Signed By:DINESH SINGH NAYAL Signing Date:06.02.2021 22:47:53

the LED lights installed turned out to be defective and were not replaced. This is stated to not have taken place not due to any fault of the Petitioner however, the same resulted in the termination of the contract in its favour, as well as the Petitioner being put on the holiday list.

5. Mr. Agarwal, ld. counsel for the Petitioner, submits that immense damage has been caused to the Petitioner due to the conduct of Respondent No.2. He further submits that the blacklisting/debarment order issued by Respondent No.1 would continue to be a blemish on the Petitioner while applying for future contracts. He also submits that Respondent No.2 was an approved vendor of IOC and hence it was engaged by the Petitioner.

6. Ms. Narayan, ld. counsel on behalf of Respondent No.1, submits that blacklisting was only for a period of one year and the said period has already expired. She fairly submits that in the future, if the Petitioner bids for any tender, the fact that it was earlier debarred or blacklisted by IOC, would not come in the way of it being awarded the said tender, if it fulfils all terms and conditions of the tender and is found deserving of being awarded the same.

7. Heard ld. counsels for the parties. This Court has perused the impugned order dated 25th October, 2019. The operative portion of the said order reads as under:

"Thus you contract under Tender bearing no.

RCC/NR/DSO/ENG/PT-159/2016-17 is terminated forthwith in line with the aforementioned clauses. Apart from termination, you are put on holiday list for a period of 1 year w.e.f. 24/10/2019. You are hereby also informed that the security deposited by you in the form of Bank guarantee has been forfeited as the same has already been invoked. Further the rectification work shall be got done by the Corporation at your risk and cost and recovery on account of supervision charges

Signature Not Verified Digitally Signed By:PRATHIBA M SINGH Signing Date:06.02.2021 12:40 Signature Not Verified Digitally Signed By:DINESH SINGH NAYAL Signing Date:06.02.2021 22:47:53

shall be made for taking up the work through alternate agency from the alternate agency."

8. A perusal of the same shows that the Petitioner was put on a holiday list which in effect means debarment, for a period of one year starting from 24th October, 2019, which has already expired now. Insofar as the termination of the tender contract is concerned, the Petitioner's case is that the payments are not being released under the said tender.

9. This court is of the opinion that this Court cannot direct recovery of amounts without a factual determination. The question as to the breaches by Petitioner or his agent, if any, and any amounts which are due, ought to be agitated before a Civil Court. The further submission that Respondent No.2 was an approved vendor by IOC and hence it was engaged by the Petitioner cannot also be gone into in the present petition.

10. In view of the fact that the blacklisting period is already over and the stand of the IOC is that the Petitioner would not be disabled in any manner from participating in future tenders, it is observed that the Petitioner would be entitled to be fairly considered for any such future tenders by IOC.

11. No further orders are called for in this matter. It is made clear that the remedies of the parties', with respect to seeking recovery or other damages or losses against each other, are left open to be agitated by availing their respective remedies in accordance with law.

12. This petition and all pending applications are disposed of in the above terms.

PRATHIBA M. SINGH JUDGE FEBRUARY 5, 2021 Rahul/Ak

Signature Not Verified Digitally Signed By:PRATHIBA M SINGH Signing Date:06.02.2021 12:40