The High Court
Case Details
IN THE HIGH COURT OF JHARKHAND AT RANCHI W.P.(C) No. 3006 of 2017 --------- M/s OMEC Engineers, a registered firm through Sri Uday Prakash Singh, S/o Late Ramdutt Singh, R/o 16/C-6, New Area, Morabadi, P.O. Morabadi, P.S. Bariatu, District Ranchi (Jharkhand) Partner OMEC Engineering. ... … Petitioner Versus 1. Jharkhand Urja Vikas Nigam Ltd. its Chairman-cum-Managing Director having its office at Engineers Bhawan, HEC, Dhurwa, P.O. & P.S. Dhurwa, District- Ranchi. through 2. Managing Director, Jharkhand Bijli Vitran Nigam Ltd. 3. 4. 5. P.O. & P.S. Dhurwa, District Ranchi. The Chief Engineer (APDRP), Jharkhand Urja Vikas Nigam Ltd. having its office at Engineers Bhawan, HEC, Dhurwa, P.O. & P.S. Dhurwa, District- Ranchi. Financial Controller Jharkhand Bijli Vitran Nigam Ltd. P.O. & P.S. Dhurwa, District Ranchi. Senior Manager (Accounts), Head Quarter, Jharkhand Urja Vikas Nigam Ltd. having its office at Engineers Bhawan, HEC, Dhurwa, P.O. & P.S. Dhurwa, District- Ranchi. ... … Respondents --------- CORAM : HON'BLE MR. JUSTICE RONGON MUKHOPADHYAY HON'BLE MR. JUSTICE DEEPAK ROSHAN For the Petitioner For the JUVNL --------- : Mr. Ujjal Choudhary, Advocate Mr. Raunak Sahay, Advocate : Mr. Rajiv Ranjan, Sr. Advocate Mr. Ashok Kumar Yadav, Advocate --------- Order No.14/Dated, the 8th February, 2024 Per Rongon Mukhopadhyay, J. Heard Mr. Ujjal Choudhary, learned counsel for the petitioner and Mr. Rajiv Ranjan, learned Senior Counsel appearing for the respondent-JUVNL. 2. In this writ application, the petitioner has prayed for the following reliefs: that a) To declare that the respondents cannot disown the liability of their predecessor in office (being successor of the erstwhile JSEB) on any pretext including (relations resembling contractual) relationships which was rendered for a lawful purpose, benefit (in the form of earning revenue and pilferage control) whereof has been/ is being taken by the respondents for last seven years after its successful commissioning, in contractual the or -2- to upset jurisdiction the name of non-existent, parameters alien to law and de-hors the terms of contract. b) For issuance of a writ of, in the nature of certiorari quashing the order dated 06.10.2015 passed/communicated by respondent No. 2 on the incorrect and untrue materials bereft the record the record of having no Respondent No. 1 (hierarchy wise senior) dated 29.10.2013 qua non-approval, non BOQ and devolution of materials and other factual aspects which had misled the adjudication of Cont. (civil) 147 of 2014. c) For a consequential relief of issuance of an appropriate writ/order direction commanding the respondents to discharge their liability in terms of section 70 of Indian Contract Act, 1872 for the item admittedly supplied erected as required consensus novation of work order & commissioned (Supported by completion certificate issued by competent authority) benefit whereof are/were being taken by them, as illegal nor that work were neither gratuitous. And d) For such other relief(s) to which the petitioner may be found entitled to either in law of equity. 3. The factual aspects enumerated in this writ
Facts
application are that the petitioner is a partnership firm duly registered under the provisions of Indian Partnership Act 1932. The respondents had come into being after being created as successor to the erstwhile Jharkhand State Electricity Board being 2 of the 4 Government Companies created from the said Board. It has been stated that a notice inviting tender being NIT No. 516/PR JSEB/06-07 was issued by the Jharkhand State Electricity Board for a project which was christened as Accelerated Power Development Reforms Programs (hereinafter referred to as APDRP) mainly related to design, manufacture, renovation, augmentation of transmission lines on turnkey basis for Ranchi township on 22.02.2007. The notice inviting tender had 2 parts; one being the technical specification and the other is the commercial specification, wherein itemized details, manner of performance and the mode of payment were prescribed. The petitioner firm had -3- participated in the tender process and was declared to be L-1 for NIT No. 516. The work orders were partially issued by separating the offer in two parts on 02.07.2008; the first being Order No. 161 & 162 of Rs. 17,38,55,700.00 for supply and Rs. 1,42,43,850.00 for erection out of Rs. 36,68,05,170.00 and Rs. 4,25,98,550.00 respectively for supply and erection. The remaining work order for Rs. 19,29,49,470.00 and Rs. 2,83,54,700.00 was given vide Work Order No. 425 and 426. After the work orders were issued agreements were entered into for all the work orders between the partners of the partnership firms and the purchasers duly signed by the functionary of the JSEB as defined in Clause 1.9. Certain imbroglios had surfaced with respect to commencement of the work which however was ironed out and ultimately on the basis of a joint decision taken in a joint meeting held on 18.12.2008, the petitioner proceeded with the work orders which was segregated and the first part was concerned with LT AB Cable and bare manager wire for 235/358 Km of Ranchi township and the second part was with respect to LT distribution box for which there was no provision in the BOQ and armoured cable from the transmission pole to the consumer. The bills were being paid as per the terms of the contract. It has been stated that in the meantime, on account of some unconfirmed reports a preliminary inquiry was lodged being Preliminary Enquiry No. 16/09 by the Vigilance Department. A committee was constituted thereafter with respect to the progress of the work which reported that 98% of the work was completed by the petitioner-agency. A follow up meeting was held on 11.10.2010 headed by the Member (Distribution) and attended by CEOs-cum-Nodal Officer of all the completed projects who verified the work done by the agency and was satisfied that the work was completed in all respects. However, when the payments were not being released to the petitioner-agency a writ application was preferred being W.P.(C) No. 4482 of 2012 which was disposed of on 23.07.2013, wherein liberty was given to the petitioner to approach the Chairman of the Jharkhand State Electricity Board with a fresh representation containing all necessary facts and documents in support of its claim for payment of outstanding dues -4- against the execution of work under the work orders issued under APDRP Scheme and on receipt of such representation the Chairman, Jharkhand State Electricity Board was directed to consider the same in accordance with law and, on due verification of the records and thereafter pass a reasoned and speaking order in respect of the claim of the petitioner and if the claim of the petitioner was found to be genuine and legally admissible and there was no legal impediment in releasing the said amount payments should be made within a period of eight weeks from the date of disposal of the representation. Pursuant to the order dated 23.07.2013 passed in W.P.(C) No. 4482 of 2012 a reasoned order was passed by the Chairman, Jharkhand State Electricity Board on 29.10.2013 wherein the claim of the petitioner was found to be genuine and a direction was given to release the payment to the petitioner. Since in spite of the order passed by the Chairman, Jharkhand State Electricity Board on 29.10.2013 the payments were not being released in favour of the petitioner a contempt application was preferred being Contempt (Civil) Case No. 147 of 2014 but the said contempt application was dropped vide order dated 04.12.2015. The petitioner has thereafter approached this Court for redressal of his grievance by filing the instant writ application. 4. A counter affidavit has been filed by the respondents in which reference has been made to PE-13/2009 which was instituted by the Vigilance Department and it has been stated that the Secretary, Department of Energy had communicated to the Vigilance Department vide Letter No. 918 dated 24.03.2012 for early disposal of the inquiry and in response to which Secretary, Department of Energy was informed that the
Legal Reasoning
Board officials were prima facie found to have indulged themselves in criminal conspiracy of not following the rules of tender and on account of the same huge financial loss has been incurred by the government. It has been stated that the Vigilance Bureau had instituted a First Information Report bearing Vigilance Case No. 19/2013 on account of the irregularities found in the APDRP projects. Reference has been made to the order passed by the -5- Chairman, Jharkhand State Electricity Board on 29.10.2013 wherein a direction was given to release the admitted dues of Rs. 27.19 crores to the petitioner and when the proposal for payment was sent to CE, APDRP by the accounts wing the same was sent back with queries due to which the payments could not be made. The counter affidavit has also enumerated the reasons for not making payment to the petitioner agency. It has also been stated that the Managing Director, JUVNL has passed a speaking order on 06.10.2015 regarding the pending bills and the same was dependent on the outcome of the First Information Report which was registered apart from certain other irregularities which have been mentioned in the order of the Managing Director. 5. The petitioner had also filed a supplementary affidavit wherein the irregularities which have been pointed out by the respondents have been confronted by submitting that most of the irregularities were on account of the Board officials and in fact no objection was made by the respondents at the time when the work was in progress. It has also been stated that there has been no recommendation from the Vigilance Department for withholding the payment due to the petitioner on account of the pendency of the vigilance case as the Deputy Director General of Police, Vigilance Bureau had categorically noticed vide letter dated 10.05.2012 that if Jharkhand State Electricity Board is satisfied with the execution of the projects, they can verify the quality and quantity of work at their end and take appropriate decisions. It has also been stated therein that similarly placed companies had also filed writ petitions and pursuant to the order passed by this Court payments have also duly been made to them but the petitioner has been deprived on account of the pendency of the vigilance case as the predominant reason for withholding the payment. 6. It has been submitted by Mr. Ujjal Choudhary, learned counsel appearing for the petitioner that when the work orders were being executed by the petitioner there was no objection on the part of the respondents or from the erstwhile Board officials of Jharkhand State Electricity Board and only when the payments became due the respondents on one pretext or the other all of -6- which are frivolous in nature have denied such payment. It has been submitted by Mr. Choudhary, that once the Chairman of the Jharkhand State Electricity Board had passed a direction for payment of the dues to the petitioner the subsequent act of the Managing Director of JUVNL in passing a reasoned order specifying irrelevant reasons for rejecting the claim of the petitioner is in direct conflict with the order passed by this Court in W.P.(C) No. 4482 of 2012. In fact, the Managing Director, JUVNL could not have sat in appeal over the order dated 23.07.2013 passed by this Court in W.P.(C) No. 4482 of 2012 and his passing a reasoned order is contemptuous on the face of it. Mr. Ujjal Choudhary, learned counsel for the petitioner has further submitted that it has been more than a decade the payments of the admitted dues to the petitioner have been withheld. It has been submitted that so far as the reasonings given by the respondents with respect to withholding of the admitted dues to the petitioner is concerned, the same seems to be primarily with respect to the internal matter of the respondents and in the affidavits filed in this case as well as in W.P.(C) No. 4482 of 2012 it would be abundantly clear that only on account of pendency of the vigilance case of which the petitioner is not even accused the payment has been withheld. Mr. Choudhary while referring to the agenda of the Jharkhand State Electricity Board which has been brought on record through the supplementary affidavit has submitted that the firms which had completed the work which were allotted to them of APDRP have been paid as the said affidavit reveals that in case of Jamtara and Katras Town payments has already been made as per the direction of the High Court. It has been submitted that even the Vigilance Department has not recommended for withholding the payment of the petitioner and the onus has been passed on to the Board and consequently to the present respondents that appropriate decisions can be taken if the Jharkhand State Electricity Board is satisfied with the execution of the project. Mr. Choudhary has concluded his submission by underlying the fact that there is no hindrance for the respondents to release the admitted dues to the petitioner and merely on account of pendency of the vigilance case which was -7- primarily directed towards the Board officials, there does not seem to be any hindrance in releasing the admitted dues in favour of the petitioner. 7. Mr. Rajiv Ranjan, learned Senior Counsel appearing for the respondent-JUVNL has taken us through the various orders and the decisions of the respondents with respect to the irregularities committed by the petitioner as well as the pendency of the vigilance case and the factors enumerated in the counter affidavit which according to Mr. Rajiv Ranjan, would act as a spanner in the claim of the petitioner for release of the admitted dues. It has been submitted that certain queries were raised which were earlier not properly considered by the Chairman, Jharkhand State Electricity Board and in fact the Managing Director, JUVNL had decided the issue of pending bills subject to the outcome of the registered First Information Report and approval of the Board of Directors which on the face of it would indicate irregularities having been committed which has caused a loss to the State Exchequer. Mr. Rajiv Ranjan, has put much stress on the vigilance case while submitting that the partners of the petitioner agency have also been named in the First Information Report and release of the payments at this stage is not feasible on account of the vigilance case still pending. 8. The factual aspects of the case and the dispute between the parties have already been noted in the preceding paragraphs and it is to be deciphered as to whether the action of the respondents in withholding the dues payable to the petitioner is justified or not. In this context, we may at the first instance referred to the order passed by the learned Single Judge of this Court in W.P.(C) No. 4482 of 2012. In the said writ application, the petitioner has sought for payment of admitted bills and the same was disposed of on 23.07.2013, the operative portion of which reads as follows:
Decision
“In such circumstances, the writ petition is being disposed of without commenting anything on the merits of the case with liberty to the petitioner to approach the Chairman of the Jharkhand State representation Electricity Board with a fresh -8- containing all necessary facts and documents in support of his claim for payment of outstanding dues against the execution of work under the work orders issued under A.P.D.R.P. Scheme within a period of three weeks. On receipt of such representation, the Chairman, Jharkhand State Electricity Board shall consider the same in accordance with law and, on due verification of records, pass a reasoned and speaking order in respect of claim of the petitioner within a period of 12 weeks thereafter, which shall also be communicated to the petitioner. It the claims of the petitioner are found to be genuine and legally admissible and there is no legal impediment in the same, payments in lieu thereof shall also be made within a period of 8 weeks thereafter.” 9. Accordingly, in terms of the order dated 23.07.2013 passed in W.P.(C) No. 4482 of 2012 representation was submitted before the the Chairman, Jharkhand State Electricity Board which was considered and a speaking order was passed on 29.10.2013 which is as follows: “I am, therefore, of the considered view that the claims of the representationist M/s Omec Engineers is genuine and is found fit to be the payment of balance admitted and accepted dues of Rs. 27.19 crores made within 8 weeks of issue of this order in accordance with the directions of the Hon’ble Jharkhand High Court in W.P.(C) No. 4482 of 2012.” The aforesaid conclusion is based on the following: (i) M/s OMEC ENGINEERS with their offer of Rs. 40.94 crores were the L1 bidder for this work and accordingly the work was allotted to them. (ii) The justification for the L1 quote is well documented in the Contract documents of the Board records. (iii) The completion certificate for the work was issued on 28.09.2012 by the Electrical Superintending Engineer-cum-Chief Executive Officer, Ranchi Electrical Circle and the date of completion and commissioning is recorded as 21st September 2010. The one year mandatory maintenance period has also been completed. (iv) Memo No. 1659 dated 26.11.2010 issued by Electrical Superintending Engineer-cum-Chief -9- Executive Officer, Ranchi Electrical Circle further reconfirms the successful completion and commissioning of the work and provides the detailed Quantity Verification Report, Devolution of Materials with SRV and Material Reconciliation/Utilisation report. No deviations have been observed. (v) All bills related to the supply and erection have been admitted and verified by all the competent board authorities. (vi) Vigilance has advised that the Board is free to make payment after ascertaining the quality and quantity of the work. Compliance of Audit observations have already been made. (vii) The satisfactory completion of the work has been verified by various board bodies and been committees. commissioned and is also being utilized with admitted benefits. system The has (viii) There have been a number of agenda that have been proposed for lifting of Resolution No. 591 for release of embargo on payments, but the same has not been done till date. (ix) Any further delay in payment may increase the risk of interest payment that might be imposed by the courts on further Legal action the representationist by M/S OMEC ENGINEERS. 10. The order dated 29.10.2013 passed by the Chairman, Jharkhand State Electricity Board is a comprehensive order and has considered all aspects of the matter while coming to such conclusion and in fact reference has also been made to the vigilance case as well as to the communication of the Additional Director General of Police, Vigilance Bureau giving a free hand to the Board to make payment if they are satisfied with the quality, quantity and completion of the work. The said reasoned order also seems to include the fact that the Board is commercially using the facilities after commissioning of the work related to these projects and the same has resulted in marked benefits. Taking a cue from the above-mentioned order which has made reference of the letter of the Additional Director General of Police, Vigilance Bureau dated 10.05.2012, the said letter has also been perused wherein it has -10- been categorically specified that the Board is competent to take a decision with respect to the payment to be made if it is satisfied with the quality and quantity of work and if the work has been completed. It is an admitted fact that the work has been completed by the petitioner. It also appears that so far as the vigilance case is concerned, the partners of the petitioner agency had approached this Court in W.P. (Cri) No.196 of 2018 and the said writ application was withdrawn in view of the fact that in the counter affidavit filed by the Vigilance Department on 29.03.2019, it had been stated that the petitioner is not a named accused and he has not been called to testify till date. Mr. Choudhary, has stated that the position which was existing then is existing today also which fact has not been denied by Mr. Rajiv Ranjan, learned Senior Counsel appearing for the respondents. It also appears that the Managing Director, JUVNL was authorized by the Board of Directors to examine the issue with respect of payment of dues to the petitioner in its totality consequent to which on 06.10.2015 the Managing Director, JUVNL had passed an order denying such claim on account of the following reasons which are enumerated in the said letter itself: (i) (ii) Restriction in cost revision of the project vide resolution no. 509/08-09 were not complied. 3rd and 4th work order nos. 425, 426 were not approved by the Board/CPC. (iii) Non–BoQ items worth Rs. 18,61/- crores were not approved by the Board. (iv) Board has imposed embargo in the payment of all (v) the projects. Balance materials (Rs. 2.42 crores) is lying with the agency at their store. (vi) FIR has been lodged vide case no. 19 of 2013 by the Jharkhand Vigilance Bureau, Ranchi. 11. The Board of Directors had considered the report submitted by the Managing Director, JUVNL and gave a direction to request the Vigilance Department to conclude and give their final report. So far as the reasons for denying the petitioner the dues as would appear from the speaking order dated 06.10.2015 passed by the Managing Director, JUVNL is concerned, the same reveals that save and except the institution of a First Information -11- Report by the Vigilance Bureau the other reasonings which have been given to stall such payment appears to be with respect to the internal functioning of the Board. It is not in dispute that once the work orders were issued to the petitioner the same were acted upon and the work was completed for which a completion certificate was also issued by the Board and there is nothing on record to indicate that at any point of time during the period of completion of work the issues which find place in the speaking order dated 06.10.2015 passed by the Managing Director, JUVNL wherever brought up acted as a hindrance or the petitioner was prevented from completing the work which was allotted to it. What can be culled out from the reasons given in the counter affidavit as well as the speaking order dated 06.10.2015 of the Managing Director, JUVNL is that the only obstacle which remains according to the respondents is the vigilance case which is still said to be pending. There is nothing on record to suggest that the partners of the petitioner had ever been summoned or any action taken against them and the respondents, therefore, cannot take a plea at this stage that pendency of the vigilance case would be an obstacle in releasing the payments to the petitioner-agency and that only after culmination of the vigilance case can an affirmative decision be taken in favour of the petitioner. 12. As we have noted above, even the Additional Director General of Police, Vigilance Bureau had on a query intimated the department that the department may proceed if it is satisfied with the quality and quantity of work if the work has been completed within time but in spite of the said observations made by the Vigilance Department merely on account of some internal irregularities primarily with respect to non-approval of the Board, which though has not yet been conclusively proved on account of the pendency of the vigilance inquiry the respondents could by no stretch of imagination withhold the admitted dues payable to the petitioner. It further appears that the speaking order passed by the Managing Director, JUVNL on 06.10.2015 is in defiance to the order passed by this Court in W.P.(C) No. 4482 of 2012 dated 23.07.2013 as well as the reasoned order passed by the Chairman, -12- Jharkhand State Electricity Board who on consideration of all aspects of the matter had given a direction for making payment of the admitted dues of the petitioner. The entire acts of the respondents as enumerated above does indicate that on some pretext or the other without there being any basis whatsoever and in the backdrop of the order passed by this Court in W.P.(C) No. 4482 of 2012 and the speaking order passed by the Chairman, Jharkhand State Electricity Board apart from the other scenarios depicted above there was no occasion for the respondents to have withheld the admitted dues of the petitioner. 13. In the circumstances, noted above, we hereby direct the respondent no. 2 to release the admitted dues of the petitioner to the tune of Rs. 27.19 crores immediately and forthwith and not later than 12 weeks from the date of receipt / production of a copy of this order. 14. The petitioner at the time of receiving of the payment shall also furnish an indemnity bond of the amount which would be paid to the petitioner. 15. This writ application stands disposed of. (Rongon Mukhopadhyay, J.) (Deepak Roshan, J.) Alok/-