Nafr High Court
Case Details
1 / 18 WPC No. 5889 of 2024 & WPC No.5893 of 2024 2025:CGHC:8093 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 5889 of 2024 Order reserved on 04.02.2025 Order delivered on 17.02.2025 1. M/s Bloom Companies LLC JV with M/s Almondz Global Infra- Consultants Limited 2nd Floor, Tower-A, Capital Business Park, Above Croma, Sohna Road, Sector-48, Gurugram-122018 Also At-1st Floor, Above HDFC Bank, Khasra No.1067/2, Besides TVS Showroom, Ranitarai Road, Patan, Distt. Durg-491111, Chhattisgarh. 2. M/s Bloom Companies LLC Having its Office At 2nd Floor, Tower-A, Capital Business Park, Above Croma, Sohna Road, Sector-48, Gurugram-122018. 3. M/s Almondz Global Infra-Consultants Ltd., Having its office At F-33/3 Okhala, Industrial Area, Phase-II New Delhi- 110020 All above through their Authorized Representative Shri Aditya Verma, S/o Shri Sandeep Kumar Verma, Office At- House No.76, Senior HIG Bungalow, Sector-29, Housing Board Colony, Naya Raipur- 493661. Versus --- Petitioners 1. Union Of India Through The Secretary Ministry Of Road Transport & Highways, Transport Bhawan 1, Parliament Street, New Delhi-110001 2. National Highway Authority Of India Corporate Office, G-5 & 6, Sector- 10, Dwarka, New Delhi-110075 3. Project Director Project Implementation Unit Raipur-II, National Highway Authority Of India, Old Montfort School Campus, NH-30, Jhanki, Abhanpur, District Raipur-493661 --- Respondents And 2 / 18 WPC No. 5893 of 2024 WPC No. 5889 of 2024 & WPC No.5893 of 2024 1. M/s Bloom Companies LLC JV with M/s Almondz Global Infra- Consultants Limited 2nd Floor, Tower-A, Capital Business Park, Above Croma, Sohna Road, Sector-48, Gurugram-122018 Also At-1st Floor, Above HDFC Bank, Khasra No.1067/2, Besides TVS Showroom, Ranitarai Road, Patan, Distt. Durg-491111, Chhattisgarh. 2. M/s Bloom Companies LLC Having its Office At 2nd Floor, Tower-A, Capital Business Park, Above Croma, Sohna Road, Sector-48, Gurugram-122018. 3. M/s Almondz Global Infra-Consultants Ltd., Having its office At F-33/3 Okhala, Industrial Area, Phase-II New Delhi- 110020. All above through their Authorized Representative Shri Aditya Verma, S/o Shri Sandeep Kumar Verma, aged about 31 years, Office At- House No. 76, Senior HIG Bungalow, Sector-29, Housing Board Colony, Naya Raipur- 493661 --- Petitioners Versus 1. Union Of India Through The Secretary Ministry Of Road Transport & Highways, Transport Bhawan 1, Parliament Street, New Delhi-110001 2. National Highway Authority Of India Corporate Office, G-5 & 6, Sector- 10, Dwarka, New Delhi-110075 3. Project Director Project Implementation Unit Raipur-II, National Highway Authority Of India, Old Montfort School Campus, NH-30, Jhanki, Abhanpur, District- Raipur-493661 --- Respondents (Cause title is taken from the Case Information System) For Petitioners For Respondent/UOI
Legal Reasoning
: Shri Prateek Sharma, Shri Rajiver R. Raj, Shri Harshwardhan and Shri Devendra Patel, Advocates : Shri Niraj Baghel, Advocate appears on behalf of Shri Ramakant Mishra, Dy. Solicitor General of India For Respondents No.2 & 3 : Shri Shantanu Deshpande, Advocate (through Video Conferencing) and Ms. Khusbhoo Naresh Dua, Advocate 3 / 18 C A V Order By Bibhu Datta Guru, J. WPC No. 5889 of 2024 & WPC No.5893 of 2024 1. Since common facts and grounds involved in both these petitions, they are being considered and decided by this common order. 2. (i) In WPC No.5889 of 2024 the petitioner is seeking quashment of the impugned debarment notice dated 6-11-2024 bearing No.NHAI/CG/ 2022/Durg-Raipur-Aurang/(Pkg-A)/AE/136 and in WPC No.5893 of 2024 the petitioner is seeking quashment of the impugned debarment notice dated 6-11-2024 bearing No.NHAI/CG/2022/Durg-Raipur- Aurang/(Pkg-B)/AE/140. (ii) By the aforesaid impugned debarment notices issued by the respondent No.2 the petitioners have been declared non-performer and debarred retrospectively from future participation in any future works of NHAI for a period of two years from the date of release of corresponding SPS payment for Package A1 & B2 in accordance with clause 3.13 of GCC in terms of Sub-clauses 3(a), (c) and (e) of clause 1.1 of Appendix N of the Consultancy Agreement read with NHAI Policy Circular No.16.12/2022 dated 18.01.2022 (NHAI/Policy Guidelines/Non-Performer & Debarment/2022) in accordance with S. No.3(a), (c) &(e) of the table given in para 4.1. 1 2 Package ‘A’ in WPC No.5889 of 2024 Package ‘B’ in WPC No.5893 of 2024 4 / 18 WPC No. 5889 of 2024 & WPC No.5893 of 2024 (iii) For the sake of convenience and for adjudication of both the petitions, the pleadings and documents of WPC No.5889 of 2024 are being referred. 3. (a) The Petitioner No.1 is a Joint venture of M/s Bloom Companies LLC i.e. petitioner No. 2 herein and M/s. Almondz Global Infra- Consultants Limited i.e. petitioner No.3 herein. The petitioner companies are premier consulting engineering companies working in India for providing Civil Engineering Consultancy to Government and specialized Consultancy services to Semi Government and Private Organizations. Petitioner is a leading Consulting Organization specializing in Highways & Bridges, Structures, Railways, Urban and Regional Infrastructure Development, Water Supply, Water Resources Development and Management, Traffic and Transportation, Institutional Strengthening and Capacity Building, and Socio Economic and Environmental Impact Assessment. The petitioner is leading consulting organization with the Ministry of Road, Transport& Highways for providing consultancy services for all types of road projects, bridge projects, construction supervision of Highways and bridges etc. (b) On 25.07.2022, the respondent No.2 issued a NIT/Request for Proposal (RFP) for providing Consultancy Services for Authority's Engineer for Supervision of Construction of 6-lane Durg - Raipur - Arang Bypass section of NH-53 from Design Ch. 0+000 (Vill. Tendesara) to Design Ch. 44+500 (Vill. Parsada) in the state of Chhattisgarh on EPC Mode under Bharatmala (Package A) and for 5 / 18 WPC No. 5889 of 2024 & WPC No.5893 of 2024 6-lane Durg - Raipur - Arang Bypass section of NH-53 from Design Ch. 44+500 (Vill. Parsada) to Design Ch.92+230 (Vill. Paragaon) in the state of Chhattisgarh on EPC Mode under Bharatmala (Package B). (c) The petitioner No.1 namely; M/s. Bloom Companies LLC and M/s. Almondz Global Infra-Consultants Limited. entered into Joint Venture vide Memorandum of Understanding dated 18.08.2022 for the purpose of participating in the aforesaid bids and execution upon award of contract. In terms of aforesaid MoU, the petitioner participated in the aforesaid bids and being H1, the petitioner was awarded the contract. Thereafter, the Consultancy Agreement was signed between Respondent No.2 and petitioner for Package A&B. (d) As per Contract Agreement with contractor the roles and responsibilities with regards to execution of work and its payment has been clearly defined in clause 19.4 of Contract Agreement. As per clause 19.4 of Contract Agreement, the Contractor shall raise monthly bills for works which contractor considers themselves entitled to for completed stages of the work. As per Clause 19.3 Authority Engineer (petitioner) is to certify the bills for payment by respondent and in terms of Clause 19.18 the Authority Engineer may by an Interim Payment Certificate make any correction or modification in any previous Interim Payment Certificate issued by Authority Engineer. (e) The Team Leader appointed by the respondent on the recommendation of Authority Engineer is at the project site office and 6 / 18 WPC No. 5889 of 2024 & WPC No.5893 of 2024 the key personnel certify the payment of the bill to the Project Director. The head office of Authority Engineer has no where withal to verify the veracity of calculation done by key professional at site. As per Consultancy Agreements, the Petitioner had authorized the Team Leader of Package A&B. Accordingly respondent No.2 issued notice to proceed in Package A & B and accordingly the petitioner commenced its service. Subsequently, the contractor submitted SPS-01 with the Team Leader of petitioner for payment of Rs.11,38,24,885.49/- & Rs.54,35,33,280/- (Cumulative value of work done). Thereafter, the respondent sought comments of the petitioner in this regard. Pursuant to the same the petitioner recommended payment of 90%. The respondent has accepted the recommendation of team leader of petitioner and accordingly payment was made to the EPC Contractor. Again the contractor requested for release of balance 10%, which was duly recommended. (f) Despite of the aforesaid facts, all of a sudden the Deputy General Manager (Tech.) Regional Office, Raipur (CG) issued show cause notice in terms of provision under clause 2.9.1(d) of the consultancy agreement granting 10 days time as to why action should not be taken against the petitioner. The petitioner replied to the same and requested for not invoking the provisions of clause 2.9.1(d) of contract agreement. Again the respondent issued show cause notice alleging that the petitioner has been negligent towards its duties and responsibilities, which are contained under the Scope of Work/Terms of Reference of Consultancy Agreement and the petitioner is required to show cause within 15 7 / 18 WPC No. 5889 of 2024 & WPC No.5893 of 2024 (fifteen) days from the date of receipt of notice as to why an appropriate action under clause 3.1.3 (a), (c) & (e) Appendix-N of Consultancy Agreement, debarment upto two years as per NHAI circulars N.16.12/2022 dated 18.01.2022 should not be taken against the petitioner. The petitioner submitted detailed reply thereby explaining and rebutting all the allegations made in the alleged show cause notice point by point. The petitioner also requested for personal hearing for clarification and justification. Acceding the said request the authorities granted personal hearing on 23.08.2024 wherein the petitioner explained the issue in detail, however, the respondent did not provide any minutes of the said personal hearing/meeting. Even for more than three months, no further clarification was sought from the petitioner and in utter shock and surprise to the petitioner, petitioner was served with impugned debarment notice dated 06.11.2024 whereby the petitioner has been debarred retrospectively from future participation in any future works of NHAI for a period of two year from the date of release of corresponding SPS payment in accordance with clause 3.13 of GCC in terms of sub clauses 3(a), (c) and (e) of clause 1.1 of Appendix N of the Consultancy Agreement read with NHAI Policy Circular No.16.12/2022 dated 18.01.2022 (NHAI/Policy Guidelines/Non-Performer & Debarment/ 2022) in accordance with S.No.3(a), (c) & (e) of the table given in para 4.1. Thus, these petitions. 4. (A) Learned counsel appearing for the petitioners would submit that the impugned action on the part of the respondent is arbitrary, 8 / 18 WPC No. 5889 of 2024 & WPC No.5893 of 2024 unreasonable and discriminative in nature and violative of fundamental rights of the petitioner enshrined under Article 14 and 19(1)(g) of the Constitution of India. He would further submit that the impugned notice is in violation of Article 20 of the Constitution of India which mandates that no punishment order can be passed with retrospective effect. He would also submit that from the impugned notice, it is evident that the respondent has not specifically adverted to or dealt with averment made in reply to the show cause notice, which is in clear violation of law. (B) Learned counsel would submit that the respondent has miserably failed to appreciate that the impugned notice will have cascading effect on the petitioner as the petitioner will not be able to participate in any future bids. He would submit that the petitioner has submitted several bids recently with multiple other companies/firms as Joint Venture/In Association and the same will not be considered for evaluation/scrutiny. According to the learned counsel, more than 1000 employees/associates who are associated with the Petitioner's company and livelihood of more than 800 families consisting of more than 3500 persons including women and children are at stake directly and indirectly to several others. He would submit that an action of blacklisting/debarment brings in with it the civil consequences apart from stigmatizing the consultant/ contractor, who is blacklisted/debarred. Blacklisting/debarment has the effect of preventing a person from the privilege and advantage of entering into lawful relationship with the Government for purposes of gains, which may even lead to it having to wind up its business. The 9 / 18 WPC No. 5889 of 2024 & WPC No.5893 of 2024 same would, thus, have a disastrous effect on him. The Blacklisting/ debarment order involves civil consequences. It casts a slur. It creates a barrier between the persons debarred/blacklisted and the Government in the matter of transactions. The debarred/blacklists are instruments of coercion. In all such view, and the fact that a disability is created by the order of debarment/blacklisting indicates that the relevant authority is to have an objective satisfaction, without in any way being arbitrary. (C) According to the learned counsel, the respondent has not acted in a transparent manner. He would submit that the necessity of compliance with the principles of natural justice by giving the opportunity to the person against whom action of debarment is sought to be taken has a valid and solid rationale behind it. With debarment, many civil and/ or evil consequences follow. It is described as civil death of a person who is foisted with the order of debarment. Such an order is stigmatic in nature and debars such an organisation from participating in Government Tenders which means precluding them from the award of Government contracts. (D) Learned counsel would specifically argue that the debarment in future contract in spite of continuation of the current contract with the petitioner by the NHAI itself would show that the debarment order for future contract is an arbitrary decision. He would next submit that as far as the imposition of penalty of non-performer is concerned, the same was never a part of show cause notice and hence the impugned notice itself suffer from illegality. 10 / 18 WPC No. 5889 of 2024 & WPC No.5893 of 2024 (E) To buttress his contention, learned counsel would place reliance upon the decisions rendered by the Supreme Court in the matters of Maru Ram, etc. v Union of India and Others, etc.3, G. Vallikumari v Andhra Education Society and Others4, Kulja Industries Limited v Chief General Manager, Western Telecom Project Bharat Sanchar Nigam Limited and Others5 and Gorkha Securities Service v Govt. of NCT of Delhi6. 5. (Aa) Learned counsel appearing for the respondent NHAI, ex adverso, would submit that the impugned debarment notice is issued as per the terms and conditions of the Consultancy Agreement executed between the parties and the said agreement, vide Clause 8, which deals with Settlement of Disputes, provides mechanism for Dispute Resolution, which has not been availed by the Petitioners and as such the Petitioner has alternate and efficacious remedy as per the contract which ought to have been exhausted. He would further submit that the debarment notice has been issued owing to the lapses/deficiencies on the part of the Authority Engineer in services provided under the subject contract. Keeping the same in view, and particularly looking at the facts and circumstance of the instant matter, the contentions raised by the Petitioner essentially touch the substantial question of facts which needs examination and appreciation by the Competent Court Tribunal.