Kerala High Court
M/S.Hill Lifecare Limited vs Engineering Projects (India) Limited on 5 February, 2019
Author: Hrishikesh Roy
Bench: Hrishikesh Roy, A.K.Jayasankaran Nambiar
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE THE CHIEF JUSTICE MR.HRISHIKESH ROY
&
THE HONOURABLE MR. JUSTICE A.K.JAYASANKARAN NAMBIAR
TUESDAY, THE 05TH DAY OF FEBRUARY 2019 / 16TH MAGHA, 1940
WA.No. 943 of 2017
AGAINST THE JUDGMENT IN WPC 6600/2017 of HIGH COURT OF KERALA DATED 27-03-2017
APPELLANT/1st RESPONDENT:
M/S.HILL LIFECARE LIMITED, (A GOVERNMENT OF INDIA ENTERPRISE) HILL
BHAVAN, "ADHARSH" T.C 6/1718(1), VETTAMUKKU, THIRUMALA P.O,
THIRUVANANTHAPURAM - 695 006.
BY ADVS.
SRI. RATAN K.SINGH
SRI.NIKHILESH KRISHNAN
SRI.V.KRISHNA MENON
RESPONDENTS/PETITIONER & RESPONDENTS 2 TO 4:
1 ENGINEERING PROJECTS (INDIA) LIMITED
(A GOVERNMENT OF INDIA ENTERPRISE), 3D, EC CHAMBERS, 92 GN
CHETTY ROAD, T NAGAR, CHENNAI - 600 017
REPRESENTED BY ITS GENERAL MANAGER.
2 MINISTRY OF HEALTH FAMILY WELFARE, NIRMAN BHAWAN,
NEW DELHI 110 108, REPRESENTED BY ITS SECRETARY.
3 INDIAN OVERSEAS BANK, PALIKA BHAWAN, SECTOR - 13,
R.K. PURAM, NEW DELHI - 110 066 REPRESENTED BY ITS CHIEF MANAGER,
4 DEPARTMENT OF PUBLIC ENTERPRISES, NO 20, NEW MOTI BAGH, NEW
DELHI 110 023, REPRESENTED BY ITS SECRETARY.
BY ADVS.
SRI.S.RAMESH BABU (SR.)
SRI.P.SHANES METHAR
SRI.JAISHANKAR V. NAIR
SRI.SHRIHARI RAO
SMT.K.PARVATHY
THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 05.02.2019, THE COURT ON
THE SAME DAY PASSED THE FOLLOWING:
W.A.No.943 of 2017
: 2 :
JUDGMENT
Hrishikesh Roy, C.J.
Heard Sri.V.Krishna Menon, the learned counsel appearing for the appellant. Also heard Sri.Shanes Methar, the learned counsel appearing for the first respondent/Contractor. The learned Central Government Counsel Sri.Jaishankar V. Nair is appearing for the respondents 2 and 4.
2. The Writ Petition No.6600 of 2017 was filed by the Engineering Projects (India) Limited, a Government of India undertaking, challenging the Ext.P8 order dated 22.2.2017, whereby the contract awarded to the writ petitioner for construction of the Super Specialty Hospital at Madurai was terminated. The contract was awarded by M/S HLL Lifecare Limited, who were the Consultant appointed for the project, by the Ministry of Health and Family Welfare.
3. The writ petitioner, as the successful bidder, commenced construction as per the contract dated 18.2.2014 (Ext.P1) but because of various factors, the work could not be completed within the targeted date. Noticing the slow progress of the work, the contract was terminated on 22.2.2017 by the Ext.P8 order and that was challenged by the aggrieved Contractor.
4. The learned judge, after due consideration of the rival contention, concluded that the Ext.P8 order was arbitrary and illegal and not in W.A.No.943 of 2017 : 3 :
accordance with the provisions contained in the O.M. Dated 12.6.2013 (Ext.P9). The impugned order was accordingly quashed with direction to the Consultant to refer the dispute to the Permanent Machinery for Arbitration (PMA) and it was also ordered until a decision is taken, the interim order granted by the Court against invocation of the Bank guarantee on the basis of the Ext.P8 order will continue. Thus aggrieved, this Writ Appeal is filed by the Consultant.
5. In course of the proceeding of the Writ Appeal, the necessity was felt to monitor the progress of the work and accordingly, various orders were passed from time to time. In the Court's last order on 11.12.2018, the status report filed by the first respondent was noticed, from where it could be gathered that major part of the contract work was completed and only few snag points had to be addressed. On that occasion, the Court also interacted with the Project Manager of the HLL Lifecare Ltd. as well as the General Manager of the Engineering Projects (India) Ltd. and we were given to understand that in about six weeks time, the hospital building can be completed. Accordingly, the case was adjourned.
6. Today, we are informed by the learned counsel for the respondent Contractor that the hospital building was inaugurated on 27.1.2019 by the Prime Minister and it has also been made functional. Responding to this, the learned counsel for the appellant would, however, submit that the in-patient W.A.No.943 of 2017 : 4 :
facility is yet to be made available and only the out-patient department is functioning besides the diagnostic departments, in the new hospital building.
7. The above development would indicate that the construction of the hospital building has been completed, barring the few snag points highlighted by the appellant. We must however bear in mind the fact that the termination of the contract, was interfered by the learned Single Judge as per the impugned judgment dated 27.3.2017 in the W.P.(C)No.6600 of 2017. In such situation, when the Contractor failed to complete the work as per the original stipulated date, there would be the claims and counter claims by the appellant and the writ petitioner, which would necessarily have to be resolved.
8. In the above context, it is the submission of the counsel for the appellant that the Permanent Machinery of Arbitration (PMA) is no more available, in the light of the decision of the Supreme Court in M/S Northern Coalfields Ltd. V. Heavy Engineering Corporation Ltd and another reported in 2016 (8) SCC 685 and therefore, the pending issues will have to be considered by some other available forum.
9. Responding to the above, the learned counsel for the respondent/writ petitioner as well as the Central Government Counsel would submit that another forum is available within the Ministry to resolve such disputes and in the event of any unresolved issue, the same can then be W.A.No.943 of 2017 : 5 :
agitated either through the Court or through the Arbitration.
10. We have noted the above submission made by the rival counsel and bearing in mind that the hospital building has now been inaugurated, we deem it appropriate to close this Writ Appeal without interfering with the impugned judgment to the extent of quashing of the Ext.P8 order. But on the subsisting grievance of either parties, they are at liberty to approach the competent forum. It is ordered accordingly.
11. With the above order, the Writ Appeal stands closed.
SD/-
HRISHIKESH ROY CHIEF JUSTICE SD/-
A.K.JAYASANKARAN NAMBIAR JUDGE jes