Rajkumar vs Chief Engineer And Head Of Department, Public Works Department, Dehradun & Others

Sudhanshu Dhulia, J

The petitioner before this Court was one of the bidders for a works contract which was to be given by the Public Works Department, Government of Uttarakhand for laying down of interlocking tiles on the roads in a residential area in Haridwar. The bid of the petitioner was Rs.75,48,139.50/- (Rupees Seventy Five Lakh Forty Eight Thousand One Hundred Thirty Nine and Fifty paise only). The petitioner was admittedly declared as L-1 and during the tender process, the petitioner has deposited an amount of Rs.2,67,000/- (Rupees Two Lakh Sixty Seven Thousand only) as earnest money. On 26.12.2018, the petitioner made a request that the work order be issued to him, since he is L-1, but the request went in vain.

At this stage, it must be also stated that it is an admitted case that the validity period of the contract was 120 days and this 120 days was to be counted from 17.10.2018 and would have expired on 14.02.2019.

Meanwhile, when the validity period expired on 14.02.2019, the petitioner on 14.02.2019 and 18.02.2019 made a request that since the validity period itself has expired, he is not interested to do the work on the rates on which he was declared as L-1, and therefore, the earnest money deposited by the petitioner be returned.

The Public Works Department, on the other hand, gave this contract in favour of L-2, who had made a bid of Rs.77,53,375.42/- (Rupees Seventy Seven Lakh Fifty Three Thousand Three Hundred Seventy Five and forty two paise only). This contract which was executed by the Public Works Department in favour of the private respondent no. 4 has been challenged by the petitioner before this Court. It is also true that this contract was executed after negotiations with respondent no. 4 and his price was brought down to Rs.75,46,633.49/- (Rupees Seventy Five Lakh Forty Six Thousand Six Hundred Thirty Three and forty nine paise only).

The Public Works Department has not given any reasonable explanation as to why they committed a delay in the matter and could not execute the contract in favour of the petitioner who was admittedly L-1, within the validity period of the contract.

Admittedly the validity period of the contract was for 120 days and it expired on 14.02.2019. In law, this contract ought to have been executed on or before 14.02.2019. It has not been done. The offer for the execution of the contract came only on 18.02.2019, which was refused by the petitioner as he was not prepared to work on the same rate. The petitioner had justifiable reasons for doing that as admittedly the contract was not executed within the validity period.

In view of this contingency, the only option available for the respondent authorities was either to negotiate with the petitioner, who was L-1, or to initiate fresh tender process by cancelling the earlier tender process. Instead, what the respondent authorities have chosen to do is to negotiate with respondent no. 4, who was L-2, and later executed the contract in his favour on 05.03.2019.

The petitioner would allege that there was no delay shown by the Public Works Department in executing the contract in favour of respondent no.4.

The contention of the petitioner appears to be correct that the contract ought to have been executed within a validity period and he was perfectly justified in withdrawing from the contract when the contract was not executed within time. The negotiation by the employer i.e. Public Works Department with private respondent, who was L-2, is also in violation of law. The only explanation given by the learned counsel for the Public Works Department that delay, if any, is only of four days and moreover the negotiation with L-2 was done in public interest, is not acceptable.

This explanation does not cure the defects in the procedure. The procedure has been laid down in law so that there are minimum chances of abuse or misuse in distribution of the Government contracts. This procedure has been evidently violated and no reason has been given as to why delay has been caused, except stereotype bureaucratic explanation.

Now the only question is as to what has to be done inasmuch as contract has been executed in favour of the private respondent and some part of the work has been completed and therefore any interference to this will ultimately harm the public.

The writ petition is therefore disposed of with the following directions:

(i) The total cost of the project was Rs. 75,48,139.50/- (Rupees Seventy Five Lakh Forty Eight Thousand One Hundred Thirty Nine and Fifty Paise), on which the petitioner has already incurred a cost of Rs. 40,000/- (Rupees Forty Thousand) odd in giving bank guarantee, etc. Therefore, 1 % on the said amount shall be given to the petitioner which comes to Rs. 75,481/-(Rupees Seventy Five Thousand Four Hundred Eighty One), within one week from today.

(ii) The Principal Secretary, Public Works Department is directed to initiate an inquiry in the matter as to why delay has been caused. It is made clear that the inquiry is not against any private individual or the officer of the Public Works Department presently before this Court. They may or may not be involved in the delay. This is only by way of caution & vigilance so that liability can be fixed in the matter and in future such matter is not repeated.

Let a certified copy of this order be given today itself on payment of usual charges.