Madhya Pradesh High Court
Tele Communications Consultant India ... vs Madhya Pradesh Rural Road Development ... on 1 September, 2025
Author: Vishal Mishra
Bench: Vishal Mishra
NEUTRAL CITATION NO. 2025:MPHC-JBP:63970
1 WP-8380-2017
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE VISHAL MISHRA
ON THE 1 st OF SEPTEMBER, 2025
WRIT PETITION No. 8380 of 2017
TELE COMMUNICATIONS CONSULTANT INDIA LTD.
Versus
MADHYA PRADESH RURAL ROAD DEVELOPMENT AUTHORITY
AND OTHERS
Appearance:
Shri Siddharth Gulatee - Senior Advocate with Ms. Tulika Gulatee, Advocate for
the petitioner.
Shri Manish Kumar Verma - Advocate with Ms. Nidhi Sonkar, Advocate for the
respondents no.1 and 2.
ORDER
Assailing the order dated 12.06.2017 passed by the respondent no. 2, whereby an attempt has been made to encash the bank guarantee which was submitted by the petitioner as performance security under the Contract Package No. MP 3635.
2. It is a case of the petitioner that the petitioner was awarded a contract for construction of road under Package No. MP 3635, Phase VII under Agreement dated 7.7.2007 showing the details of roads which were required to be constructed by the petitioner are as under :-
Sr. Name of Road Road Length (In Kms.) No.
1. Sirkapur to 2.720 Bhaourgarh
2. Jhiri to 2.726 Lalgaon Dhangwani to Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47 NEUTRAL CITATION NO. 2025:MPHC-JBP:63970 2 WP-8380-2017
3. Jhiri 1.520
4. Lalgaon to 0.710 Bharga
5. Katkar to 2.300 Lurgi
6. Babaiya to 2.320 Chikhali
7. Mahulpani to 3.325 Babaiya Total 15.621
3. The petitioner completed the contract and was awarded the completion certificate on 24/8/2009, from which, it is clear that the petitioner has constructed the entire stretch of roads barring the road from Sirkapar to Bhaourgarh, which in the completion certificate is mentioned that it could not be executed due to the fact that no permission from the forest department was granted. The said fact was communicated by the General Manager of the responder no.1 vide communication dated 13.1.2010. This goes to show that there is an admission on part of the responder no. 1 regarding the entire work completed by the petitioner except the stretch of 2 Kms. from Sirkapar to Bhaourgarh, it deserves to be excluded from the contract as the work could not be completed because of the fact that no NOC from the forest department was given. Thereafter, the respondent no.1 was able to secure necessary permission from the Forest Department and vide Communication dated 25.5.2010, the respondent made a request to the petitioner to take up the construction for the aforesaid stretch of road on additional terms and conditions. However, the petitioner refused to take up the construction pointing out the reasons that he has already demobilized his plant, machinery and manpower from the site two years back. Therefore, the construction of the road on the same site on the old rates is not feasible and Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47 NEUTRAL CITATION NO. 2025:MPHC-JBP:63970 3 WP-8380-2017 therefore, the work cannot be undertaken. Again, the petitioner reiterated its stand by issuing a letter dated 5.8.2011 to the respondents clearly pointing out the fact that the completion certificate was issued 2 years back and the petitioner has already demobilized his entire plant, machinery and manpower from the site, therefore, he is not in a position to take any additional work in pursuance to the earlier contract. However, the Chief General Manager of the respondent no.1 issued a letter dated 30.6.2011 to the responder no. 2 directing him to ensure the work of the excluded patch of land be executed by the petitioner, failing which, the some coercive action be taken in terms of the earlier contract. Realizing the fact that a dispute has arisen, the petitioner filed an appeal under Clause 24 of the Contract to the respondent no. 1 on 18/8/2011 pointing out that in an adjacent package i.e. Package number MP 3637 Seoni, the road coming in the forest area was excluded from the contract and a separate tender was floated for the same after obtaining forest clearance. Some documents were filed to demonstrate that in the identical circumstances, the respondents are treating the contractor differently. The respondent no.2 has filed response to the appeal by later day 27.8.2011 virtually admitting the position regarding award of contract to the petitioner on 7.7.2007, completion of work by the petitioner on 31/7/2009, for which, completion certificate dated 24.8.2009 was issued to the petitioner except the stretch of 2 Kms. from Sirkapar to Bhaourgarh. The office of respondent no. 2 making a proposal to the responder no. 1 along with recommendation of CGM, Jabalpur to delete the portion of road coming under the forest area from the package and in a similar case, Package No.3637, approval has been Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47 NEUTRAL CITATION NO. 2025:MPHC-JBP:63970 4 WP-8380-2017 accorded for deleting the forest portion of the road and directions have been issued to call the tender separately for the forest portion. Thereafter, while communication dated 11.5.2012 the Chief General Manager of the Responder no.1 in Jabalpur made a recommendation that the stretch of road measuring 2 Kms. must be completed by inviting separate tenders. After a long lapse of time, the Chief General Manager- I, Bhopal issued directions to the responder no. 2 vide Communication date 10.1.2013 directing the responder no. 2 to force the petitioner to complete leftover stretch of road under the original contract, failing which, action for termination of contract will be initiated. Against the letter dated 29.01.2013, the petitioner once again preferred an appeal under Clause 24 of the Contract, but prior to the decision taken on the appeal, an order dated 27.2.2013 was issued by the responder no.2, by which, the petitioner had been asked to show cause against the termination of contract which was duly responded by the petitioner. However, the reply submitted by the petitioner was not taken note of and in a predecided manner, now the respondent no. 2 is going to terminate the contract and forfeit bank guarantee and the security deposit. The petitioner filed a writ petition before this Court being WP No.5407/2013, wherein vide Order dated 19.6.2013 the respondent nos. 1 and 2 were restrained from taking any coercive action against the petitioner and thereafter, the reply was filed by the respondents no.1 and 2 and the writ petition was disposed of 1.8.2016 holding it to be premature and granting liberty to the petitioner to file reply to the show cause notice and directed the respondents to pass an order thereafter within 15 days. The petitioner filed a Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47 NEUTRAL CITATION NO. 2025:MPHC-JBP:63970 5 WP-8380-2017 reply to the show cause notice and also preferred an application under Clause 24 of the Contract dated 8.9.2016. However, the said application has been rejected on 5th of June, 2017 without considering any of the grounds raised by the petitioner and in pursuance to the said order, the respondents have issued another order on 12.6.2017 directing the responder no. 3 to encash the bank guarantee submitted by the petitioner.
4. Counsel appearing for a petitioner has drawn attention of this Court to the letter dated 27.8.2011 as well as letter dated 11.5.2012 with respect to the similar contract, wherein, it was non-completion of the work of road, due to the fact that NOC is not granted by the Forest Department. A decision was taken to delete the said work from the original contract and to get it executed by showing a fresh NIT as subsequently the NOC has been granted from the Forest Department. It is his case that hostile discrimination is done with the petitioner. The request of the petitioner had not been considered by the authorities despite of issuance of a completion certificate to the petitioner way back on 24/8/2009. Now, by way of impugned order, the authorities are trying to encash the bank guarantee of the petitioner, for the work which has already been completed by the petitioner way back in the year 2009. Therefore, the petition is filed. In support of his argument, he has placed reliance on a judgment passed by the Hon'ble Supreme Court in the case of Union of India and another vs. Millenium Delhi Broadcast LLP and others, (2022) 7 SCC 67 with reference to para 14.
5. On notice being issued, a reply has been filed by the respondents authorities denying the petition averments. It is contended that in terms of Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47 NEUTRAL CITATION NO. 2025:MPHC-JBP:63970 6 WP-8380-2017 the agreement, the petitioner was not only required to construct the road but also required to to do maintenance of the road for a period of 5 years. He was required to maintain the machinery and equipment at the site for maintenance of the road so constructed by him. He has not maintained the road even for a single day. The petitioner company has constructed the road in part and has not constructed the road of 2.720 Kms. from Sirkapar to Bhaourgarh. There is some delay in getting permission from the forest department. However, after the permission of the Forest Department was granted on 25.2.2010, they intimated the petitioner for completing the work of remaining 2 Kms. in terms of the agreement and the petitioner had not completed the construction of the road, therefore, the impugned order dated 12.6.2017 was passed. The non-completion of the work of the petitioner clearly attracts the provisions of the contract. That non- completion of work by the petitioner cannot be equated with any of the other contract which has been granted to some other contractor. Even the completion certificate which has been issued to the petitioner clearly shows that the execution of work of 2 Kms. from Sirkapar to Bhaourgarh has not been completed by the petitioner. The show cause notice which was issued to the petitioner was put to challenge by filing a writ petition which was dispose off holding it to be premature and thereafter, the authorities have considered the reply submitted by the petitioner and passed the impugned order which is in accordance with the contract conditions.
6. It is contended that in contract matters, the scope of entertaining the petition under Article 226 of the Constitution of India is limited. This Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47 NEUTRAL CITATION NO. 2025:MPHC-JBP:63970 7 WP-8380-2017 Court cannot sit as an appellate authority and go beyond the terms and conditions of the contract documents. Even on two occasions the Court had directed for holding a mediation for settling the dispute, but, as recorded from the order sheet dated 14.7.2025 and 11.11.2022 the mediation has failed. As the contract given to the petitioner has not been completed by him as well as the fact that the completion certificate issued by the team leader of the consultant has not been accepted by the office of the Chief Executive Officer, which was duly communicated to the petitioner, the impugned order has been passed which does not call for any interference in the present writ petition under Article 226 of the Constitution of India.
7. Counsel appearing for the respondents no.1 and 2 has underlined clause c and k of the contract document to justify the action taken by the authorities which reads as under :-
c) the Engineer gives Notice that failure to correct a particular Defect is a fundamental breach of Contract and the Contractor fails to correct it within a reasonable period of time determined by the Engineer.
k) If the Contractor fails to deploy machinery and equipment or personnel as specified in the Contract Data at the appropriate time."
8. Counsel appearing for the respondents no.1 and 2 has also submitted that there is a Dispute Redressal mechanism as provided under Clause 24 of the Contract documents and thereafter, Clause 25 before the Madhya Pradesh Arbitration Tribunal against the order passed by the competent authority. Therefore, he has prayed for dismissal of the writ petition. Clause 24 reads as under :-
"24. Dispute Redressal System.Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47
NEUTRAL CITATION NO. 2025:MPHC-JBP:63970 8 WP-8380-2017 If any dispute or difference or any kind what-so-ever shall arises in connection with or arising out of this Contract or the execution of works or maintenance of the Works thee under, whether before its commencement or during the progress of Works or after the termination, abandonment or breach of the Contract, it shall, in the first instance, be referred for settlement to the competent authority, described along with their powers in the Contract Data, above the rank of the Engineer. The competent authority shall, within a period of forty-five days after being requested in writing by the Contractor to do so, convey his decision to the Contractor. Such decision in respect of every mater so referred shall, subject to review as hereinafter provided, be final and binding upon the Contractor. In case, the Works is already in progress, the Contractor shall proceed with the execution of the Works, including maintenance thereof, pending receipt of the decision of the competent authority as aforesaid with all due diligence."
9. Heard the learned counsel for the parties and perused the record.
10. The undisputed facts from the record are allotment of tender in favour of the petitioner for the construction of the road as mentioned hereinabove, for which, the agreement dated 7.7.2007 was entered into with respect to Package No. MP 3635 Phase 7. The petitioner has completed the contract and was awarded the completion certificate under the signatures of Team Leader dated 24.8.2009 with a note that road from Sirkapar to Bhaourgarh from Ch. 2720 to 4700 (1980 m.) could not be executed dur to non permission of forests department. Thereafter, the letter dated 13.1.2010 was issued under the signatures of Chief General Manager, pointing out the fact that in terms of the proposal given by the General Manager that the contract awarded to the petitioner be dealt with as completed and proposal for final payment towards the bills to the petitioner was issued.
11. From perusal of the aforesaid, it has seen that admittedly the Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47 NEUTRAL CITATION NO. 2025:MPHC-JBP:63970 9 WP-8380-2017 petitioner has completed the maximum work in terms of the contract, for which, the completion certificate was issued on 24/8/2009. The unexecuted work of road between Sirkapar to Bhaourgarh about 2 Kms. could not be completed due to non grant of NOC from the Forest Department. However, subsequently NOC has been given from the Forest Department on 25.2.2010, that is after the completion certificate was issued to the petitioner and letter dated 25.5.2010 was issued to the petitioner requesting him to complete the remaining work and the petitioner has shown his inability to complete the same pointing out the fact that he has already demobilized the plant, machinery and manpower, therefore, it is not feasible to complete the remaining work on the previous costs of the contract and requested for issuance of a fresh NIT for the remaining work after deleting the same from the contract document. He has also preferred an appeal under Clause 12 of the General Conditions of Contract, giving an example of identical work with respect to Package No. 3637, wherein, the forest portion which was unlike the road falling in the forest portion which was not completed, was directed to be deleted from the original contract document and directions were issued to call tender separately for the forest portion by letter dated 11.5.2012.
12. It is the case of the petitioner that he is an identically situated as admittedly the NOC from the Forest Department was not issued prior to issuance of a completion certificate to the petitioner. However. he again made an appeal under Clause 24 of the General Conditions of Contract on 30.1.2013 after the letter dated 29.1.2013 was issued informing regarding Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47 NEUTRAL CITATION NO. 2025:MPHC-JBP:63970 10 WP-8380-2017 the proposed action in terms of clause 52 of the Agreement to be initiated against the petitioner. Thereafter, the petitioner preferred a writ petition being WP No.5407/2013, wherein an interim order was granted. However, the said writ petition was disposed off on 1.8.2016 granting liberty to the petitioner to file a reply to the show cause notice and the authorities were directed to dwell upon the reply filed by the petitioner and take a final decision. Thereafter, a detailed reply was submitted by the petitioner to the show cause notice. He has also preferred an appeal under clause 24 of General Conditions of Contract on 8/9/2016 pointing out the difficulties in completing the contract on the previous rates. However, the authorities have rejected the claim of the petitioner by the impugned order.
13. The entire record shows that the petitioner's case has been discriminated from that of other contractors. Although, there is a provision under the the contract document of approaching to the Arbitration Tribunal against the decision taken by the authorities. However, the fact remains that a specific ground has been taken by the petitioner that in similar circumstances with respect to another contract with respect to Package No. 3637, a decision was taken by the Chief General Manager, vide order dated 11.5.2012 to delete the area falling under the forest area from the original contract document as the work could not be completed due to non issuance of NOC from the Forest Department and to issue a fresh NIT for completion of the contract. The case of the petitioner is exactly identical to that of Package No. 3637. It is an admitted position that the petitioner has completed the work allotted to him except a patch admeasuring 2 Ksm. between from Sirkapar to Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47 NEUTRAL CITATION NO. 2025:MPHC-JBP:63970 11 WP-8380-2017 Bhaourgarh as the NOC from the Forest Department was not issued to the petitioner. It is not disputed that the petitioner has already completed the remaining work on 24/8/2009, for which, the completion certificate is already issued to the petitioner. The authorities have written for clearing the bills of the petitioner, treating the work to be completed as is reflected from letter date 13.1.2010 treating the work to be completed. There is no justification given by the authorities for treating the petitioner in a different manner and not considering the genuine request of the petitioner for deleting the said work from the contract document and for issuance of a fresh NIT for completion of the remaining work. The impugned order passed by the authorities does not reflect any consideration of the aforesaid by the authorities and thereafter, they have issued the impugned order directing for terminating the contract of the petitioner and further issuing directions for encashment of the bank guarantee. As the impugned order is the non- speaking order to the aforesaid effect, the same is unsustainable and is hereby quashed.
14. This Court is conscious about the fact that there is limited scope of interference in contract matters and the scope of judicial review in contract matters in a petition under Article 226 of the Constitution of India is limited. But in the peculiar facts and circumstance of the present case, this Court deems it appropriate to entertain the writ petition as the authorities themselves have taken a decision to issue completion certificate to the petitioner and also the fact that in similar circumstances, wherein the Forest Department has not issued NOC to the other contractor, his case was treated Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47 NEUTRAL CITATION NO. 2025:MPHC-JBP:63970 12 WP-8380-2017 differently from that of the petitioner. Thus, a hostile discrimination is committed with the petitioner.
15. The matter is reminded back to the authorities for reconsideration of an appeal preferred under Clause 24 of the Contract document by the petitioner. The authorities may take a final decision in the matter after granting an opportunity of hearing to the petitioner and taking note of the plea taken by the petitioner pointing out the identical situation as in Package No. 3637.
16. The entire exercise be completed within a period of 90 days from the date of the receipt of certified copy of this order.
17. The interim order granted on 21/6/2017 to remain in force till a final decision is taken by the authorities.
18. With the aforesaid, the petition stands disposed of.
(VISHAL MISHRA) JUDGE JP Signature Not Verified Signed by: JITENDRA KUMAR PAROUHA Signing time: 10-12-2025 11:03:47