M/S B. Prasad & Co, A Partnership Firm v. The Union of India through Director General of Works a- Wing Nirman

Patna High Court CWJC No.3090 of 2013 (4) dt.03-07-2013 Page 3 /8 the earnest money, security deposit was/were recovered and the performance guarantee furnished by the petitioner was forfeited. Aggrieved by the said order the petitioner has filed the present writ petition. The respondents re-issued fresh notice inviting e- tender. For one reason or the another the said process could not further be pursued. Consequently another notice was issued inviting tender. The same has also been called in question. Learned counsel for the petitioner submits that from perusal of Annexure-9 it would appear that on request made by the petitioner the respondents extended the period for completion of work to 31.12.12. Even before expiry of the said period the respondents passed the impugned order which is per se bad in law. It is next submitted that the decision or the findings of the respondents that the petitioner defaulted in achieving adequate progress of the work and resultantly taking penal action against it is in the teeth of the law enunciated by Hon’ble Apex Court in the case of J.G. Engineers Private Limited vs. Union of India & Anr. since reported in (2011) 5 SCC 758. Particular reliance has been placed on paragraph no. 17, 18 and 19 thereof. It has also been argued that the respondent who passed the said order was revengeful since few months prior thereto a raid was conducted by the criminal branch ( economic offences) of the State Govt. Patna High Court CWJC No.3090 of 2013 (4) dt.03-07-2013 Page 4 /8 against several officers of the Central Public Works Department including the respondent Executive Engineer. Learned counsel for the respondents conversely submitted that originally the work was to be completed on or before 5.9.11. Considering the slow progress of the work by the agency a show cause notice (Annexure-A) was issued on

18.4.2011. Again the work site was inspected and second show cause notice was issued on 31.10.2011 ( part of Annexure-A series). These warnings and notices failed to evoke response from the petitioner. Resultantly the 3rd show cause notice was issued to the petitioner on 4.2.12. By another communication dated 8.12.2011 the petitioner was called upon to furnish a Work schedule/Bar Chart in order to assure the respondents that the work shall be completed as per the said Bar Chart. The petitioner failed to respond to the said notice and furnish the Bar Chart. Again the respondents served a show cause notice on the petitioner on 7.7.12. The respondents acting in their own discretion on the basis of the request made by the petitioner granted the first extension on 31.12.2011 (Annexure-C) whereby the time for completion of work was extended to 30-06-2012. On a request having been made by the petitioner the respondents by a communication dated 6.6.12 (Annexure-D) extended the period Patna High Court CWJC No.3090 of 2013 (4) dt.03-07-2013 Page 5 /8 for completion of work to 31.12.2012. Along with the said letter of extension a Bar Chart was provided to the petitioner to ensure progress of work as per the said Bar Chart. The petitioner dismally failed to adhere to said Bar Chart. A show cause notice dated

7.7.12 (Annexure-E) was thereafter served on the petitioner which did not yield any response from the petitioner. The respondents, in such circumstances, issued the impugned order dated 10-08- 2012(Annexure-1) after having found that the petitioner had suspended the work at the site and the Bar Chart provided to the petitioner in all eventuality was not likely to be achieved. Learned counsel the petitioner, reply, submitted that there is pleadings on record that the petitioner responded to the first notice. A stand is taken in the writ petition that the petitioner personally met with the Engineer at the site. It has been highlighted that for non payment of the running bills and not providing drawing and design in time delay in execution of work had occurred. From the facts noticed above, it is more than obvious that in spite of extension granted on two occasions by the respondents the petitioner failed to achieve satisfactory progress of work inasmuch as the Bar Chart enclosed along with the order of extension dated 6.6.12 was not adhered to. Instead the Patna High Court CWJC No.3090 of 2013 (4) dt.03-07-2013 Page 6 /8 petitioner suspended execution of work at site. Non adherence of work schedule and dismal progress of work, thus, stand admitted. If that be so, then no fault can be found with that part of the order whereby the contract/agreement was rescinded . This Court may notice here that repeated show cause notices were given to the petitioner to complete the work with utmost expediency. The work was assigned in June 2010 and was to be completed by 5.9.2011. On a request having been made the same was at least extended on two occasions. The petitioner was called upon to provide the Bar Chart only to ensure proper /desired progress of work. The petitioner defaulted in doing so. The respondents by communication dated 6.6.12 (Annexure-D) extended the period for completion of work to 31.12.12 and while doing so a Bar Chart was provided to the petitioner for adherence. In spite of these steps having been taken the petitioner did not commence the work and achieve desired progress which gave an occasion to the respondents to be satisfied that the work was not likely to be completed at the pace it was being executed by the petitioner within the extended time. Resultantly the action was taken. Learned counsel for the petitioner has also argued that action has been taken malafidely. He relies in this regard on the statement made in para 23 of the writ petition. In my view, the Patna High Court CWJC No.3090 of 2013 (4) dt.03-07-2013 Page 7 /8 pleadings are completely vague and it cannot be held relying on those pleadings that the present action is the result of any malafide action. Said contention is, therefore, fit to be rejected. In the case of J.G. Engineers ( supra) it has been observed that which party to the agreement contributed to the situation in which the respondents had to record the said satisfaction cannot be decided by a party to the agreement . Such decision has to be taken by an independent forum such as arbitrator. Upon such decision the consequent action can be taken by the respondents as per the contemplation in the agreement. Consequently this Court declines to interfere with that part of the decision of the respondents dated 10-08-2012 ( as contained in Annexure-1) whereby the respondents found that the petitioner, in the setting of facts, was unable to complete the work within the extended time. The resultant action taken against the petitioner pursuant to the said decision, however, merits to be interfered with and quashed. The parties shall invoke the relevant clause of the agreement for referring the said issue relating to the reasons for coming to the said satisfaction of the authority that the petitioner ( contractor) had dismally failed to achieve progress of work in spite of two extensions granted to the petitioner. Once the said issue is adjudicated upon by the said forum the Patna High Court CWJC No.3090 of 2013 (4) dt.03-07-2013 Page 8 /8 respondents would take appropriate penal action as per the relevant clause of the agreement against the petitioner. The application is allowed in part in the aforesaid term. The stay granted stands vacated. No order as to cost. Learned counsel for the petitioner, at this stage, submits that there are certain dues of the petitioner outstanding with the respondents and as such those dues may be directed to be paid to the petitioner. If there be any such dues which is not in dispute the respondents shall pay the same to the petitioner after proper scrutiny within a period of two months. Shyam/- (Kishore Kumar Mandal, J)