Gujarat High Court
Shree Ram Corporation vs Ahmedabad Municipal Corporation on 24 August, 2021
Bench: J.B.Pardiwala
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 10694 of 2020
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE J.B.PARDIWALA
and
HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI
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1 Whether Reporters of Local Papers may be allowed
to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy
of the judgment ?
4 Whether this case involves a substantial question
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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SHREE RAM CORPORATION
Versus
AHMEDABAD MUNICIPAL CORPORATION
==========================================================
Appearance:
MR KV SHELAT(834) for the Petitioner(s) No. 1
. for the Respondent(s) No. 1,2,3
MR ANUJ K TRIVEDI(6251) for the Respondent(s) No. 1,2,3
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CORAM:HONOURABLE MR. JUSTICE J.B.PARDIWALA
and
HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI
Date : 24/08/2021
ORAL JUDGMENT
(PER : HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI)
1. By way of this writ-application under Article 226 of the
Constitution of India the writ-applicant has sought the
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
following reliefs :-
"(A) The Hon'ble Court be pleased to issue writ of
Mandamus, or any other writ, order or direction, directing
the Respondent Authorities to refund the Security Deposit
amount of Rs.9 62,750 with 9% per annum rate of interest
from the date of deposit till payment to the Petitioner by
holding that forfeiture of the Security Deposit during COVID-
19 Pandemic by the Respondent Authorities is illegal,
arbitrary, unjust, unreasonable, without any basis, in
colorable exercise of powers, without authority of law and
rules and regulations applicable and consequently such
forfeiture of Security Deposit is violative of Articles 14, 19(1)
(g) r/w Article 21 of the Constitution of India.
(B) Pending hearinq and final disposal of this petition, the
Hon'ble Court be pleased to issue writ of Mandamus, or any
other writ, order or direction, directing the Respondent
Authorities to deposit the Security Deposit amount of Rs.
9,62,750 before the High Court Registry.
(C) The Hon'ble Court be pleased to grant Ad-interim Relief
in terms of Para 12(B).
(D) Pass such other and further orders as may be deemed
just and expedient."
2. Facts relevant for the purpose of deciding this writ
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
application can be summarized as under :-
2.1 The Ahmedabad Municipal Corporation (for short 'AMC')
published a Notice for "Navrangpura Multi-level Parking" "Pay
and Park" Contract in November, 2018 for an initial period of
03 years which may be mutually extended for 01 year and
maximum for 02 years. The Navrangpura Multilevel Parking is
situated close to the Navrangpura Bus Stand and has capacity
of 371 parking spaces for cars and 585 parking spaces for 2-
wheelers, out of which the tender was for 309 parking spaces
for cars and 461 parking spaces for 2-wheelers since the rest
were allotted to owners of shops and establishments. The AMC
vide its work order dated 29.12.2018 awarded the above
subject contract to the writ-applicant.
Submissions on behalf of the writ-applicant :-
3. Mr. K. V. Shelat, the learned counsel appearing for the
writ-applicant submitted that the writ-applicant was awarded
contract on 29.12.2018 and was directed to start work from
1.1.2019. He submitted that the writ-applicant had paid the
License Fee regularly after taking charge w.e.f 1.1.2019.
3.1 He submitted that by letters dated 4.2.2019 the writ-
applicant requested the respondent-AMC to declare a no-
parking zone around 200 metres of the Multi-Level Parking as
also to install parking barriers as also to regularly clean the
parking premises so that parking facilities may be adequately
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
and safely utilized. The writ-applicant had also time and again
requested the respondent-AMC to install Boom Barrier for
effective performance of the contract which were installed
initially but after 3-4 months the same were removed which
was complained of by the writ-applicant by letter dated
19.6.2019 stating that the general public was misusing the
parking premises without paying any parking fee.
3.2 He submitted that several other difficulties were faced by
the writ-applicant on account of the non-cooperation on the
part of the respondent-AMC and though requested several
times, the said breaches were not remedied. Despite which, the
writ-applicant always cooperated with the respondent-AMC and
acceded their various requests from time to time. Further, the
writ-applicant by letter dated 13.12.2019 requested the
respondent-AMC to restart the CCTV cameras to ensure the
safety of the vehicles parked in the vicinity.
3.3 He submitted that the writ-applicant had paid an amount
of Rs. 3 Lacs as Security Deposit (SD) on 15.12.2018 for which
Receipt No.20181215-4000462-777382-0026 was generated and
further amount of Rs.6,62,750 came to be paid as Security
Deposit on 24.1.2019 as directed by respondent-AMC for which
Receipt No. 20190124-4000462-009-0011 was generated. Thus,
in all, the writ-applicant deposited an amount of Rs.9,62,750
as and by way of Security Deposit which was refundable.
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
3.4 He submitted that in spite of several hurdles which were
created by the users of the parking complex which includes
Central Government organizations and Municipal Corporation
officers who refused to pay the parking charges on the ground
of they being government/municipal employees, as a result of
which the respondent authorities attention was drawn to the
issue repeatedly by the writ-applicant, but no positive action
was ever taken. It is submitted that the mismanagement
suffered by the writ-applicant and other contractors at the
hands of the AMC has also been chronicled in a Times of India
article titled "AMC's multi-level parking failure" published on
5.5.2019. Finally, on account of the national emergency and
COVID-19 pandemic lockdown situation from March, 2020 it
was impossible for the writ-applicant to continue with the "Pay
and Park" contract and consequently it created a situation of
frustration of contract and the writ-applicant requested AMC to
take back the possession of the Multi-Level Parking and to
refund the Security Deposit amount of Rs.9,62,750/- by letter
dated 12.3.2020 by giving one and half month prior notice as
per the requirement of Clause 26 of the Tender Conditions.
3.5 He submitted that no communication was received from
the respondent authorities and therefore a letter dated
20.5.2020 was addressed to the Dy. Estate Officer (West Zone)
by making mention of earlier unequivocal statements made in
letter dated 12.3.2020 regarding refund of Security Deposit
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
amount. He submitted that the AMC wrote a letter dated
17.6.2020 to the writ-applicant stating that in light of Clause
26 of the Tender Conditions the Security Deposit of Rs.
9,62,750/- is being forfeited and the writ-applicant is being
relieved from the "Navrangpura Multi-Level Parking" "Pay and
Park" contract with immediate effect.
3.6 He submitted that in the Tender Conditions there is a
specific condition (Clause 24) regarding execution of separate
agreement on acceptance of a tender but no such agreement
was ever executed by and between the writ-applicant and the
AMC and that no final contract ever came to be executed by
the writ-applicant and the AMC. In absence of such specific
contract as contemplated in Clause 24 of the Tender
Conditions, it is not open for the AMC to refuse to refund the
Security Deposit and it is also stated that the General
Conditions at the time of tender before execution of concluded
separate contract under Clause 24 is not binding and the AMC
has no legal authority or justification to forfeit this amount of
Security Deposit of Rs.9,62,750/-, moreso during COVID-19
Pandemic.
3.7 He submitted that the AMC in relation to other "Pay and
Park" contracts have not issued any such condition, for
example, at KankariaParisar, Zoo, etc. the writ-applicant is
having existing "Pay and Park" contract from the AMC and
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
there is no condition for not refunding Security Deposit on
recession of contract if the contractor wants to leave the
contract -- he has only to inform the AMC before such
prescribed period and on such intimation itself the contract
stands terminated and Security Deposit is liable to be refunded
as per Clauses 11 and 12 of the tender conditions in relation
to KankariaParisar, Zoo, etc. "Pay and Park" Tender for 2018-
19 as also 2019-20.
3.8 In support of his above submissions Mr. Shelat has relied
on the decisions in the case of (1) ABL International Ltd. vs.
Export Credit Guarantee Corporation of India, reported in
(2004) 3 SCC 554 (2) Joshi Technologies International vs.
Union of India, reported in (2015) 7 SCC 728 and (3) Bharat
Coking Coal Ltd., vs. AMR Dev Prabha, reported in 2020 SCC
OnLine SC 335. Lastly he submitted that since there is no final
concluded contract ever arrived at by and between the writ-
applicant and the AMC in relation to the Security Deposit of
Rs.9,62,750/- and in view of the fact that there is no breach
committed by the writ-applicant and in view of the fact that
respondent authorities have with consent in view of COVID-19
Pandemic relieved the writ-applicant of the tender work
without any penalty or claim, it is incumbent upon the AMC
to refund the amount of Security Deposit amounting to
Rs.9,62,750/- with 9% per annum rate of interest from the
date of deposit till payment.
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
Submissions on behalf of the respondents :-
4. Mr. Anuj K. Trivedi, the learned counsel appearing for
the respondents submitted that the writ-application pertaining
to the tender issued by the respondent corporation, for the Pay
and Park "Navrangpura Multilevel Parking" facility (for short
the "subject tender"). He submitted that the respondent No.l
Corporation published a notice for the subject tender on
17.11.2018. The said notice also contained the "tender
conditions", which were binding on the prospective bidder. It
is submitted that the writ-applicant submitted its offer vide
letter dated 7.12.2018, wherein the writ-applicant categorically
agreed to be bound by the said tender conditions.
4.1 He submitted that on completion of the tender process,
the writ-applicant came to be awarded the contract and the
respondent No.l Corporation issued a Work Order dated
28.12.2018, in favor of the writ-applicant. It is submitted that
the said Work Order was also subject to the terms and
conditions contained in the tender notice, which had been
accepted by the writ-applicant.
4.2 He submitted that the writ-applicant was awarded the
tender for a period of 03 years, starting from 1.1.2019. As per
the terms and conditions of the tender, the writ-applicant was
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directed to deposit the requisite security deposit and the
payment of the 1st quarter towards the license fee, to the
respondent No.l Corporation. However, the writ-applicant failed
to comply with the said directions and consequently, the
respondent No.l Corporation issued a reminder letter dated
22.1.2019. As the same had yet not been complied with by the
writ-applicant, the respondent No.2 was constrained to issue a
second reminder dated 7.2.2019, to the writ-applicant. It is
submitted that while operating the pay and park facility, the
writ-applicant had failed to make timely payments of the
license fee to the respondent No.1. Corporation.
4.3 He submitted that as per the Clause 26 of the tender
conditions, the writ-applicant was required to give a notice of
one and a half months for terminating the subject tender, and
was further required to pay the license fees for the said
period. The said clause specifically states that in view of the
premature termination, the security deposit paid by the writ-
applicant would be forfeited, as the writ-applicant failed to
complete the tender period. In view thereof, the writ-applicant
was required to pay the license fees up to the month of April,
2020, as well as, the respondent No.l Corporation was entitled
to forfeit the security deposit paid by the writ-applicant.
However, the writ-applicant not only failed to pay the license
fee for the said notice period, but by way of the aforesaid
letter, the writ-applicant also requested the respondent No.l
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Corporation to return the security deposit paid by him, inspite
of the tender condition containing no provision to the said
effect.
4.4 He submitted that the respondent No.l Corporation vide
its letter dated 17.6.2020, accepted the request of the writ-
applicant and terminated the Work Order. The Respondent No.l
Corporation in good faith and in all fairness granted a waiver
to the writ-applicant, from payment of the license fees for the
month of April, 2020, till 17.6.2020, i.e. date of issuance of
the letter. The said waiver was granted to the writ-applicant in
light of the lockdown imposed due to the Covid-19 pandemic.
However, the request of the writ-applicant, seeking
reimbursement of the security deposit was not accepted by the
Respondent No.l Corporation, in as much as, the same was
contrary to the tender conditions. The Respondent No.l
Corporation, in accordance with Clause 26 of the tender
conditions forfeited the security deposit of the writ-applicant,
in view of the fact that the writ-applicant was not willing to
complete the period of the Work Order, i.e. three years.
4.5 He submitted that the writ-applicant issued the
termination notice for the subject tender on 12.3.2020, in view
of its inability to continue with the subject tender as a result
of sustained losses. At the relevant point of time, there was no
lockdown imposed and the writ-applicant had sought
termination of the Work Order only on the ground of the
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
alleged losses suffered by it and not on account of the Covid-
19 pandemic.
4.6 He submitted that the writ-applicant was awarded the
tender and issued the Work Order for a period of three years
for a license fee of Rs.38,51,000/ per year. Consequently, for a
period of three years, the writ-applicant was obliged to pay
the RespondentNo.l Corporation a sum of Rs.1,15,53,000/-. As
against the same, the writ-applicant prematurely terminated the
Work Order after a period of one year and two and half
months. Thus, as against Rs.67,39,250/-, which the writ-
applicant would have had to pay, if the Work Order was not
prematurely terminated, the Respondent No.l Corporation has
forfeited security deposit of merely Rs.9,62,750/-.
4.7 He submitted that in view of the aforesaid facts the
Respondent No.l Corporation has acted in accordance with the
tender terms and conditions and has terminated the Work
Order, as desired by the writ-applicant. Moreover, the
Respondent No.l Corporation has also granted waiver to the
writ-applicant, from the payment of the license fees for the
period of April, 2020, till June, 2020, in view of the lockdown
imposed due to the Covid-19 pandemic. Therefore, the
forfeiture of the security deposit of the writ-applicant is in
consonance with the tender terms and conditions and the same
is not arbitrary and unfair, as is being alleged by the writ-
applicant and hence the writ-applicant is not entitled to any
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
relief, as sought for in the writ-application.
4.8 He submitted that the writ-applicant has not approached
this Court with clean hands and has suppressed pertinent facts
with regard to the subject matter dispute. With regards to the
allegations of non-cooperation by the Respondent No.l
Corporation, qua the issues raised by the writ-applicant to
boom barriers, security cameras, cleanliness, etc., the
respondent No.l Corporation states that the same are patently
baseless and without any substance. It is submitted that the
tender terms and conditions categorically provide that it is the
writ-applicant's sole responsibility to manage and maintain the
multi-level parking premises. In view thereof, the respondent
No.1 Corporation was not responsible to facilitate the writ-
applicant for the aforesaid requirement. The respondent No.1
Corporation had installed boom barriers and CCTV cameras for
a certain period, as to cooperate with the writ-applicant.
4.9 He submitted that as a matter of settled law, the terms
and conditions of a tender are binding on the tender applicant.
Admittedly, the writ-applicant had agreed to the tender
conditions in the offer letter itself. The Work Order issued to
the writ-applicant was also subject to the tender terms and
conditions. In view thereof, the assertion of the writ-applicant
that it is not bound by the tender terms is completely,
erroneous and untenable. Moreover, the allegation of the writ-
applicant that the concerned clause, pertaining to forfeiture of
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security deposit, is discriminatory, as the same is not present
in other tenders of the Respondent No.l Corporation, is not
only factually incorrect, but the same is also legally not
tenable. The Respondent No.l Corporation states that the said
clause, pertaining to forfeiture of security deposit, is also
present in various other tenders issued by the Respondent No.l
Corporation.
4.10 He submitted that identical forfeiture clause is present in
the "Pay and Park" tender issued for Mount Carmel Mithakali
Cross Roads, Stadium - Panchvati Cross Roads and for the Law
Garden area. In view thereof, the Respondent No.l Corporation
has similar forfeiture clauses in other tenders issued over the
similar subject matter, as well. Even otherwise, the writ-
applicant having agreed to the tender terms and conditions and
subsequently having being awarded the tender, subject to the
said terms and conditions, cannot be permitted to challenge
the same, subsequently, as per its convenience. It is a settled
position of law that the terms of a contract, entered
knowingly, cannot be challenged subsequently for being
arbitrary under Article 14, so as to protect a private interest.
4.11 He submitted that in view thereof, the writ-applicant has
maliciously tried to settle its private interest, under the garb of
false allegations of arbitrariness and unreasonableness, the
same being untenable as per the settled position of law. With
a view to forward its private financial interest, the writ-
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
applicant has alleged that as no agreement had been entered
into, post the award of the tender, the tender terms and
conditions would not apply, which is also factually incorrect
and legally not tenable.
5. We have heard Mr. K. V. Shelat, the learned counsel
appearing for the writ-applicant and Mr. Anuj Trivedi, the
learned counsel appearing for the respondents. We have also
gone through the record of the proceedings.
Analysis :-
6. It is an undisputed fact that the writ-applicant was
awarded contract by the respondent No.1 - Corporation on
29.12.2018 for a period of 03 years with effect from dated
1.1.2019 to 31.12.2022. As per the tender conditions the writ-
applicant was directed to deposit the requisite amount towards
security deposit and the payment of first quarter towards
license fees to the respondent No.1 - Corporation. The writ-
applicant failed to comply with the said direction, therefore
the respondent No.1 - Corporation issued a reminder letter
dated 22.1.2019. The respondent No.1 - Corporation issued the
second reminder on 7.2.2019 asking the writ-applicant to
deposit the amount of three quarters towards license fees
within a period of three days, failing which the respondent
No.1 - Corporation would be constrained to take action
against the writ-applicant in accordance with law. Even while
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
operating the pay and park facility the writ-applicant chose not
to make the timely payment of license fees to the respondent
No.1 - Corporation and consequently by letters dated
29.6.2019, 18.7.2019 and 28.1.2020 addressed by the
respondent No.1 - Corporation to the writ-applicant asking the
writ-applicant to comply with the tender conditions of three
quarters license fees, failing which the respondent Corporation
would be constrained to take legal action against the writ-
applicant in accordance with law.
6.1 We have noticed that the respondent No.1 - Corporation
gave ample opportunities to the writ-applicant to comply with
the conditions of the contract which came into effect from
1.1.2019 to 31.12.2022 for a period of 03 years, more
particularly under Clauses (5) and (20) of the tender
conditions. Inspite of opportunities given by the respondent
No.1 - Corporation, the writ-applicant chose not to comply
with the tender conditions.
6.2 Instead of honouring the tender conditions and complying
with the same the writ-applicant chose not to deposit the
license fees with the respondent No.1 - Corporation and
sought premature termination of the work order by letter dated
12.3.2020 stating that the writ-applicant was facing financial
crunch and it was unable to continue with the work order as
it had suffered financial losses. The writ-applicant informed the
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respondent No.1 - Corporation to terminate the work order
under Clause (26) of the tender conditions. The letter dated
12.3.2020 written by the writ-applicant to the respondent No.1
- Corporation is produced thus ;
"To, 12.3.2020
Dy. Estate Officer,
West Zone, Usmanpura,
Ahmedabad.
Sub : Accept resignation as per Condition (26) of the Tender.
Respected Sir,
With reference to the aforementioned subject, it is to be
stated that we have the contract of Navrangpura multilevel
parking since long time which is under your control. We have
suffered huge financial loss from the day we took charge of
the parking, till today and we are not able to bear this loss
further.
Therefore, kindly accept one and half month prior intimation
for resignation for Navrangpura multilevel parking, as per
condition no.26 of the tender and kindly do the needful for
the timely refund of our security deposit."
The clause (26) of the tender conditions is produced thus;
"The licensee shall have to inform in writing, three months
prior to discontinuing from the contract in case of
discontinuation before completion of contract period. License
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fee must have been paid at the Municipal corporation for this
period and the same will not be refunded under any
circumstances and the security will be forfeited. Any amount
will not be refunded from half yearly license fee under any
circumstances."
6.3 The clause (26) of the tender conditions requires the writ-
applicant to inform in writing 03 months prior to discontinuing
from the contract in case the writ-applicant wishes to
discontinue the contract prior to completion of the contract.
The clause further states that in view of the premature
termination, the security deposit paid by the writ-applicant was
required to be forfeited as the writ-applicant chose not to
complete the tender period. The writ-applicant was required to
pay the license fees upto the period of April, 2020, however
the said license fees were not paid by the writ-applicant and,
therefore, the respondent No.1 - Corporation was entitled to
forfeit the security deposit.
6.4 The writ-applicant not only failed to pay the license fees
for the notice period, but by letter dated 12.3.2020 requested
the respondent No.1 - Corporation to return the security
deposit which is contrary to the conditions of Clause (26) of
the contract. The respondent No.1 - Corporation by letter
dated 17.6.2020 accepted the request of the writ-applicant and
terminated the work order by issuance of letter dated
17.6.2020. The respondent No.1 - Corporation acted fairly as a
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public body and also in view of the lockdown due to Covid-19
pandemic granted waiver from the payment of license fees for
the month of April, 2020 till June, 2020.
6.5 In our view, no error much less any error of law is
committed by the respondent No.1 - Corporation in denying
the refund of the security deposit to the writ-applicant. More
so when Clause (26) of the tender conditions permit forfeiture
of the security deposit in view of the fact that the writ-
applicant has on its own volition requested the respondent
No.1 - Corporation to end the contract as it was not willing to
complete the period of work order i.e. 03 years.
6.6 The writ-applicant has prayed for refund of Rs.9,62,750/-
which was deposited as security deposit with 9% interest from
the date of deposit till the payment to the writ-applicant by
holding that forfeiture of security deposit during Covid-19
pandemic by the authority be termed as illegal. The writ-
applicant has sought refund of security deposit relying on the
decision in the case of ABL International Ltd. (Supra) on the
basis that the writ-applicant was performing the public
function therefore the amount towards security deposit cannot
be forfeited. Even the decision in ABL International Ltd.
(supra) will be of no avail to the writ-applicant. This decision
has referred to all the earlier decisions and in paragraph 28,
the Court observed as follows:
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"28. However, while entertaining an objection as to the
maintainability of a writ petition under Article 226 of the
Constitution of India, the court should bear in mind the fact
that the power to issue prerogative writs under Article 226 of
the Constitution is plenary in nature and is not limited by
any other provisions of the Constitution. The High Court
having regard to the facts of the case, has a discretion to
entertain or not to entertain a writ petition. The Court has
imposed upon itself certain restrictions in the exercise of this
power. (See Whirlpool Corpn. v. Registrar of Trade
Marks [(1998) 8 SCC 1]) And this plenary right of the High
Court to issue a prerogative writ will not normally be
exercised by the Court to the exclusion of other available
remedies unless such action of the State or its instrumentality
is arbitrary and unreasonable so as to violate the
constitutional mandate of Article 14 or for other valid and
legitimate reasons, for which the Court thinks it necessary to
exercise the said jurisdiction." (emphasis supplied)
6.7 The writ-applicant was awarded contract and issued the
work order for a period of 03 years for a license fees payable
of Rs.38,51,000/- per year. Consequently for a period of 03
years the writ-applicant was obliged to pay a sum of
Rs.1,51,53,000/-. The writ-applicant prematurely asked for
termination of work order after a period of one year and two
and a half months. In view of above, according to the
respondent No.1 - Corporation the writ-applicant had to pay
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Rs.67,39,250/-, if the work order could not have been
prematurely terminated, as against that the respondent No.1 -
Corporation has forfeited the security deposit only of
Rs.9,62,750/-.
6.8 It is also required to deal with the argument as raised by
the writ applicant with regards to non-conclusion of contract
so as to invoke the clause of forfeiture of security deposit. The
said submission would also have no bearing in the present set
of facts as the present case is that of a work order being
issued by the respondent Corporation and the writ applicant
had already worked under the same for a limited period. The
concept of proposal and acceptance as per the provisions of
Indian Contract act, 1872 and the conduct of parties are self
explanatory in the present set of facts and hence we do not
find any strength in the said submission with regards to
conclusion of contract as raised by the writ applicant.
6.9 The other decisions being Joshi Technologies International
vs. Union of India (Supra) and Bharat Coking Coal Ltd., vs.
AMR Dev Prabha (Supra) as relied upon by the Learned
Counsel for the writ applicant would also be of no avail to the
writ applicant in the present set of facts especially when the
terms and conditions of the contract are clear and
unambiguous to the extent of forfeiture of deposit in case of
premature termination by the contractor. Once a particular
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clause is present in the contract and the same has been
accepted by the parties by signing on the dotted line, then it
is not open for one party to contend that the said condition
cannot be pressed into service for the admitted lapses. Even
otherwise the Writ Court in exercise of jurisdiction under
Article 226 of the Constitution of India cannot rewrite the
terms of contract to add or delete any ingredient so as to
satisfy the grievance of a party signatory to the contract
against the terms and conditions of the contract.
6.10 This Court had the occasion to deal with similar issue
as to forfeiture of deposit in tender process in Special Civil
Application no 3729 of 2020- Ravi Corporation versus Rajkot
Municipal Corporation wherein this Court after following the
law on security forfeiture as laid down in the case of National
Highways Authority of India Vs. Ganga Enterprises and
another reported in 2003 Supp(3) SCR 114 dismissed the
writ application by holding as under :-
7. Thus, not only is the writ jurisdiction of this
Court invoked in a purely contractual matter,
having no colour of public law and the writ remedy
is thus not maintainable as held by the Supreme
Court in the case of Joshi Technologies
International Vs. Union of India, 2015 (7) SCC 728,
but even otherwise the law with respect to interference
by the Courts in the forfeiture of security sufficiently
well settled.
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
8. Similarly, the Supreme Court in the order dated 18 th
March, 2015 passed in the Civil Appeal No.3053 /
2015 titled National Highway Authority of India Vs.
M.E.I.L.- EDB-LLC (J.V.) set aside the judgment of a
Division Bench of the Delhi High Court holding
forfeiture of the security deposit amount by MHAI to
be bad and the Supreme Court held that such
question can be adjudicated only in a suit or in
arbitration.
9. The reliance placed by Mr.S.R.Limbani, learned
counsel appearing for the writ-applicant on the decision
of the Supreme Court in the case of Food Corporation
of India and others Vs. SEIL Ltd. and others reported
in AIR 2008 SC 1101 is of no avail.
10. In the result, this writ-application fails only on the
ground of being not maintainable. We leave it open
to the writ-applicant to take recourse of any other
legal remedy available to him before any appropriate
Forum."
7. In view of the rival contentions made by the writ-
applicant and the respondent No.1 - Corporation and the
settled legal position on the question of forfeiture of deposit
for non compliance of tender conditions, We are not inclined
to entertain this writ-application under Article 226 of the
C/SCA/10694/2020 JUDGMENT DATED: 24/08/2021
Constitution of India. The respondent No.1 - Corporation has
acted in accordance with the terms of the contract and fairly
waived the license fees from April, 2020 to June, 2020. The
respondent No.1 - Corporation has terminated the contract at
the instance of the writ-applicant. Therefore, no error can be
said to have been committed by the respondent No.1 -
Corporation. Hence, We see no reason to interfere in the
forfeiture of security deposit.
8. In view of above, the writ-application fails and
accordingly it is dismissed.
(J. B. PARDIWALA, J)
(VAIBHAVI D. NANAVATI,J)
K.K. SAIYED
