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Orissa High Court

M/S. Group No.5 Security Service vs State Of Odisha And Others .... Opposite ... on 13 January, 2026

Author: Murahari Sri Raman

Bench: Murahari Sri Raman

      IN THE HIGH COURT OF ORISSA AT CUTTACK
                      W.P.(C) No. 32707 of 2025

M/s. Group No.5 Security Service                   ....                  Petitioner

                                     -Versus-
State of Odisha and others                         ....          Opposite Parties


Advocates appeared in this case:
For Petitioner             : Mr. Susanta Kumar Mishra, Advocate

For State/Opp. Party       : Mr. Sanjay Rath, Addl. Government Advocate

For Opp. Party No.5        : Mr. Satya Smruti Mohanty, Advocate


                      CORAM:
            HON' BLE THE CHIEF JUSTICE
                        AND
      HON'BLE MR. JUSTICE MURAHARI SRI RAMAN

                            JUDGMENT

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Date of hearing and Judgment: 13th January, 2026

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HARISH TANDON, CJ.

1. This is the second round of litigation before this Court

assailing the action of the authorities in terminating the contract as

the petitioner failed to improve the performance of their services for

which the contract was awarded to them. Earlier, the contract was

terminated after giving a notice, which was assailed by the

petitioner on the ground that Clause 4.8 of the Request for Proposal

(RFP) has not been strictly adhered to. The said Clause provides the

modalities for termination of a contract, which includes thirty days'

clear notice in writing to be served upon the service provider, who

was correspondingly given an opportunity to remedy such

deficiencies in performance of an obligation within fifteen days

from the date of receipt thereof.

2. The Court disposed of the said writ petition being W.P.(C)

No.13384 of 2025 on 20th August, 2025 upholding the contention of

the petitioner that once the terms of the contract provides a

mechanism of terminating the contract, the authorities cannot

violate the same nor shall be permitted to whittle down its

applicability. After quashing the notice of termination, being

opposed to Clause 4.8 of the RFP, liberty was granted to the

authorities to proceed afresh by following the procedure provided in

the said clause.

3. Apropos the said order, the notice dated 9th September,

2025 was issued to the petitioner by the Competent Authority,

highlighting the poor performance of the sanitary workers,

discrepancies in supply of the equipment/non-performance of the

staff, non-submission of the EPF and ESI details, non-payment of

the salaries and the EPF and above all, disobedience and negligence

of the staff and failure to replace the sanitary workers.

4. It is not in dispute that the petitioner responded to the said

notice by giving a reply on 23rd September, 2025 dealing with all

such allegations embodied in the said notice dated 9th September,

2025. The summum bonum of the defense taken by the petitioner is

that the allegation on the grounds, which have been enumerated in

the said notice, does not stand on a factual matrix and the intention

to terminate the contract is to facilitate the favoured person to obtain

the said contract.

5. After expiration of thirty days, the order dated 14th

October, 2025 was communicated terminating the said contract to

take effect immediately from 25th November, 2025. Simultaneously,

the contract was also awarded to the opposite party No.5, which

would reckon on and from 26th November, 2025 after the expiration

of the period of contract awarded to the petitioner, which is a

subject matter of challenge in this instant petition.

6. According to Mr. Susanta Kumar Mishra, learned counsel

appearing on behalf of the petitioner, once the earlier letter of

termination is quashed and set aside by this Court, all the steps

which have been taken prior thereto would perish automatically and

the awarding of the contract on the basis of the same is per se illegal

and unreasonable. It is further submitted that even the second

course of action taken by the authorities is per se violative of Clause

4.8 of the RFP, as the notice does not contain a clear thirty days.

7. A plea of violation of the principles of natural justice is

also projected in the instant writ petition, as no adequate

opportunity to defend or of hearing was accorded to the petitioner.

It is no longer res integra that once the concluded contract is

entered into by and between the parties, the terms and conditions

included in the said concluded contract are binding on the parties

and the adherence thereof has to be strictly followed. Any departure

from one or more terms and the conditions embodied in the said

concluded contract would entail the action of the authorities liable

to be interfered. The parties entering into a bilateral contract are

bound by the terms and conditions incorporated therein and have to

proceed on the peripheral thereof.

8. Clause 4.8 of the RFP contains an exhaustive mechanism

relating to the termination of a contract and a corresponding right

conferred upon the service provider to remedy and/or remove the

deficiencies as highlighted in the said notice. It further provides a

timeline pertaining to the notice and the action to be taken in pursuit

of terminating the contract and, therefore, such timeline is

indispensable. The said clause does not specify what should be the

contents of the said notice but unambiguous intention can be

manifested therefrom that such notice must be a thirty days' clear

notice and, therefore, any action taken within such mischief period

cannot be regarded as an action strictly in conformity thereto.

9. Clause 4.8 of the RFP also contains the remedial measures

to be taken by the service provider. The notice percolates an

intention to terminate the contract and the time limit within which

such deficiency and/or violation of the terms and conditions of the

contract has to be redressed by the service provider. The notice

dated 9th September, 2025 not only encompasses the deficiency

and/or default to be complied with the obligations imposed upon

them by virtue of the said contract but also a clear intention to

terminate the contract, obviously, in the event such discrepancy is

not remedied within fifteen days from the date of receipt thereof.

10. It is not in dispute that the said notice was not served upon

the petitioner, as we find that the petitioner replied to the said

notice, obviously, denying the allegations contained therein. The

authorities, after taking into consideration not only the allegations

leveled in the said notice, but also the reply given in defense thereof

and issued an order on 27th October, 2025 terminating the contract,

giving a sufficient time when the said order of termination would

take effect.

11. An interesting plea is taken by the petitioner that in order

to compute the clear thirty days' period of notice, the day on which

the period is to be counted should be excluded and if such

methodology is adopted, the effect of termination would fall short

of clear thirty days and, therefore, such notice is illegal, infirm and

not in consonance with Clause 4.8 of the RFP.

12. We are not impressed with the submissions so advanced

before us. The method of computation of the period for the purpose

of limitation enshrined in Section 12 of the Limitation Act, 1963

cannot be extended and/or applied in contractual field. The said

provision is applicable in relation to an institution of the

proceedings before the Court of law and, therefore, extending such

provision in the contractual field does not appear to us appropriate.

The thirty days' period has to be counted on the basis of an ordinary

course adopted in calculation thereof and not on the basis of the

methods adopted for institution of the proceedings in the Court of

law.

13. Furthermore, the said thirty days' clear timeline is in

relation to a notice issued in writing, expressing an intention of

termination on the grounds so disclosed therein and has no nexus to

the contract having terminated to take effect from a particular date.

The said Clause 4.8 of the RFP is reproduced as under:

"4.8. Termination/Suspension of Contract The District Authority/Institution may by a notice in writing, suspend the contract if the selected agency fails to perform any of his obligations including carrying out the services, provided that such notice of suspension shall specify the nature of failure, and shall request remedy of such failure within a period not exceeding 15 days after the receipt of such notice.

The District Authority/Institution after giving 30 days clear notice in writing expressing the intension of termination by stating the ground/grounds on the happening of any of the events (as mentioned below),

may terminate the agreement after giving reasonable opportunity of being heard to the service provider:

1) If the service provider do not remedy a failure in the performance of his obligations within 15 days of receipt of notice or within such further period as the District Authority/Institution have subsequently approved in writing.

2) If the service provider becomes insolvent or bankrupt.

3) If, as a result of force majeure, the service provider is unable to perform a material portion of the services for a period of not less than 60 days; or

4) If, in the judgment of the District Authority/Institution, the service provider is engaged in corrupt or fraudulent practices in competing for or in implementation of the project."

14. It is manifestly clear from the meaningful reading of the

language used therein that the District Authorities/the Institution

may terminate the agreement after giving thirty days' clear notice in

writing which must also convey an express and/or apparent

intention to terminate the said contract on the specified grounds and

an opportunity is also provided to the said service provider not only

to remedy any deficiency in service within fifteen days from the

date of the notice but also a reasonable opportunity to defend and/or

hearing ensuring the principles of natural justice encapsulated in the

instant judicial system.

15. Whether the termination would take effect from a

particular date has no nexus to the period provided for issuance of