Jharkhand High Court
Ms Inox Air Products Limited Through Its ... vs Steel Authority Of India Limited ... on 9 September, 2015
Equivalent citations: 2015 (4) AJR 472
Author: Prashant Kumar
Bench: Prashant Kumar
1
IN THE HIGH COURT OF JHARKHAND AT RANCHI
W.P.(C) No. 296 of 2013
M/s Inox Air Products Limited, a Company incorporated
under the provisions of the Companies Act, 1956, having
its registered office at Ceejay House, 7th Floor, Dr. Annie
Besant Road, Mumbai-400 018 (Maharashtra), through its
Company Secretary, Sri Narendra Mehra, S/o Shri R. N.
Mehra, R/o 402A Jewel Tower, Jogani Complex, Kalina,
Sundernagar, Santacruz(E), PO & PS- Santacruz(E),
Mumbai-400 098(Maharashtra)
... ... Petitioner
Versus
1.Steel Authority of India Limited (SAIL), a company
incorporated under the Companies Act, 1956 having its
registered office at Ispat Bhavan, Lodhi Road, New Delhi,
110 003, and its Plant situated at Bokaro Steel City,
Bokaro, Jharkhand, through its Chairman
2.Mecon Limited, a Company duly registered under the
provisions of the Companies Act, 1956 and a Government
of India undertaking having its registered and head office
at Doranda, Ranchi-834 002(Jharkhand) through its
Chairman-cum-Managing Director
.......... Respondents
------
CORAM: HON'BLE MR. JUSTICE PRASHANT KUMAR
------
For the Petitioner: Mr. Sunil Kumar, Sr. Adv.
Mr. Sumeet Gadodia, Adv.
Mr. Piyush Poddar, Adv.
For the Respondents:
(SAIL) Mr. Rajeev Ranjan, Sr. Adv.
Mr. Shresth Gautam, Adv.
(MECON Ltd.) Mr. K.B. Sinha, Sr. Adv.
Mr. Amitabh, Adv.
------
C.A.V. on 6th August, 2015 Pronounced on 9th of September, 2015
ORDER
Prashant Kumar, J. In this writ application, the petitioner has prayed for
following reliefs:
(a) For quashing of letter no. T &C(M)/B320/AKT/035RR/
1429, dated 21/22 December, 2012(Annexure-31), whereby
and whereunder, the respondent-SAIL has illegally
2
demanded a sum of Rs.4,42,46,309/- from the petitioner
and threatened that in case of non-payment of the above
amount, the same will be deducted from the other bills,
which is required to be paid by the respondent-SAIL.
(b) Petitioner further prays for restraining the
respondent-SAIL from implementing the aforesaid
impugned letter dated 21/22 December, 2012 (Anexure-31)
and from deducting/withholding the said amount of
Rs.4,42,46,309/- from the pending bills and/or bills
submitted by the petitioner regarding other separate and
unrelated contracts, which are to be paid by the
respondent-SAIL.
(c) Petitioner also prays for a direction upon the
respondent-SAIL to forthwith refund/pay to the petitioner,
an amount of Rs.5,00,000/-(rupees Five Lakhs only) along
with interest @18% p.a., which has been illegally and in
most arbitrary manner recovered/realized by the
respondent-SAIL by encashing the bank guarantee
furnished by the petitioner as Bid Security.
(d) Petitioner also prays for a direction upon the
respondent-SAIL, Bokaro Steel Plant to forthwith
refund/pay to the petitioner an amount of Rs.4,42,46,309/-
along with interest @18%, calculated from 25.10.2013,
which has been illegally and in most arbitrary manner
deducted by the respondent- SAIL, Bokaro Steel Plant
from the invoice No.1530, with respect to FFC AUG 13,
dated 31.8.2013 for Rs.6,55,39,230.59(Annexure-35),
3
which was submitted by the Petitioner to respondent-SAIL,
Bokaro Steel Plant with respect to an independent and
separate contract/agreement being No. TC/M/AGT-916,
dated 19.5.2006 (Annexure-34).
2. It is stated in the writ application that the petitioner
is a Company incorporated under the Companies Act,
1956, engaged in the business of manufacturing of
industrial, medical gases and Air Separation Plants and
running, operating and maintaining plants for the
production of 'Oxygen' and 'Nitrogen', which are required
for manufacturing of steel and other industrial products. It
is further stated that the petitioner has several long term,
ongoing contracts and arrangements with the respondent-
SAIL including an agreement dated 19.5.2006, for supply
of industrial gases to the respondent-SAIL for its steel
plant at Bokaro, Jharkhand and also entered into an
agreement on 27.12.2008 for supply of gases to its steel
plant at Salem (Tamil Nadu). It is further stated that the
said contract/agreement are for the period of 15 years
from the date of the respective contract/agreement. It is
further stated that on a monthly basis, the petitioner
receives about Rs. 7 crores from the respondent-SAIL,
Bokaro in lieu of gases supplied to it.
3. The respondent no.1-Steel Authority of India Limited
(SAIL) is a Public Sector, Government Company having its
steel plant in the State of Jharkhand, known as Bokaro
Steel Plant at Bokaro Steel City, Jharkhand. The
4
respondent no.2-MECON Limited is also a Government
Company having its head office at Doranda, Ranchi,
Jharkhand.
4. It is stated that the respondent no.1-SAIL had issued
a Global Tender Notice on 16.2.2010 (Annexure-1) for the
design, engineering, manufacturing/supply of plant and
equipment and erection, testing and commissioning,
demonstration and establishment of performance
guarantees and handing over of Compressed Air
Station(Package NO.-010). It is further stated that the
petitioner also participated in the aforesaid bid and
submitted its bid documents, wherein the petitioner had
clearly mentioned that the standard technical deviations
from API-672 would apply. It is also stated that the
petitioner furnished the Bid Security to the tune of Rs. 5
lacs through bank guarantee, which was valid up-to
30.11.2010.
It is worth mentioning that the respondent-SAIL has appointed MECON Limited for providing consultancy service with respect to the inspection of project including Compressed Air Station. It is stated that after receipt of the bid documents from the petitioner, the petitioner was informed by the MECON Limited that MECON had evaluated the tender submitted by the petitioner and it made certain queries with the petitioner. In the said letter, the MECON Limited also mentioned that the detail technical deviations given by the petitioner in the bid had 5 been noted by the MECON Limited.
It is stated that the respondents, on scrutiny of the tender submitted by the petitioner found the same Techno-Commercial acceptable. Accordingly, vide letter dated 28.6.2010 (Annexure-3), the respondent-SAIL issued letter of acceptance to the petitioner, stating therein that the time for completion of the project shall be 14 months from the date of the contract i.e., the date of signing of the contract or 30th days from the date of issue of Letter of Award (LOA), whichever is earlier. It is stated that the aforesaid LOA. received by the petitioner on 12.7.2010. Thereafter, the petitioner requested vide letter dated 14.7.2010 (Annexure-2) to the respondent no.1 for sending the Draft Contract, so that the same may be executed and the work started on an early date. In the said letter, the petitioner also stated that the effective date of the contract shall be treated from the date of signing of the contract. It is stated that thereafter, the MECON Limited sent the Draft Contract vide letter dated 15th July, 2010 (Annexure-5) to the respondent-SAIL for its comment and forwarding the same to the petitioner. The MECON Limited also sent a copy of the aforesaid Draft Contract to the petitioner. It is stated that the respondent-SAIL never confirmed the Draft Contract and sent it to the petitioner.
It is further stated that on perusal of the Draft Contract, the petitioner found that the same contained some technical specifications, which were different from 6 those specified in the tender. It is stated that the respondent-MECON Limited informed the petitioner that the specifications were to be incorporated in the final contract. It is further stated that the representatives of the petitioner met the officials of the respondent-SAIL for finalization of the technical specifications of the contract, but the respondent-SAIL had not given any heed to them. It is further stated that on various occasions, the petitioner has written to the respondents-MECON Limited and SAIL for incorporating the technical specifications and standard deviation of API-672 in the Draft Contract, but the same has not been incorporated and finally, the respondent- MECON Limited has informed that they are not taking any cognizance of the deviation list provided by the petitioner and the same would be examined during detail engineering. It is stated that in reply, the petitioner stated that at this juncture, the above decision of the respondent- MECON Limited is not acceptable to the petitioner. The petitioner further stated that it will participate in the contract discussion only after receiving the approval of the list of standard deviations of API-672 from the respondent- MECON Limited. It is further stated that the respondent- SAIL latter on informed the petitioner that the contract will be signed only on the basis of technical specifications mentioned in the bid documents and no deviation will be accepted. The respondent-SAIL further asked the petitioner to sign the agreement at the earliest, otherwise 7 the respondent-SAIL shall terminate the above contract at the risk and cost of the petitioner.
It is stated that the petitioner gave reply to the above letter and stated that since the deviations were not incorporated in the Draft Contract, the same is not acceptable to the petitioner. The petitioner, accordingly, requested the respondent-SAIL for returning the bank guarantee.
Thereafter the respondent-SAIL invoked the bank guarantee. Accordingly, the bank released the payment of Rs.5 lacs in favour of the respondent-SAIL. It is further stated that the respondent-SAIL vide letter dated 27.11.2010, directed the petitioner for executing the contract within 15 days, failing which the tender would be annulled and the consequences in terms of 'Notice Inviting Tender' (NIT) will follow. The petitioner in its reply stated that the respondent-SAIL is responsible for non-execution of the contract, thus, forfeiture of the bank guarantee amount before annulment of the contract is wrong. It is stated that the respondent-SAIL vide letter dated 9.12.2010(Annexure-29) had annulled the award of the work and informed that the consequences stated in the NIT will follow.
It is then stated that the respondent-SAIL vide letter dated 21.12.2012(Annexure-31), communicated to the petitioner that the work order for 'Compressed Air Station' of Bokaro Steel Plant has been awarded to other agency at 8 the risk and cost of the petitioner. By the said letter, the petitioner was also informed that the differential amount calculated is Rs.4,42,46,309/-. Therefore, the petitioner was requested to pay the said amount, otherwise the same will be recovered from the petitioner's current bill, which is required to be paid by the Bokaro Steel Plant. Thereafter, the petitioner filed the present writ application challenging Annexure-31.
5. It appears that during the pendency of this writ application, the respondent-SAIL had deducted the aforesaid amount from the running bill of separate contract agreement of the petitioner, bearing No. TC/ M/AGT-916, dated 19.5.2006. Therefore, an application for amendment of the writ application had been filed, which was allowed vide order dated 5.2.2014.
6. A counter affidavit filed by the respondent-SAIL, wherein it stated that after expiry of 30 days from the date of 'Letter of Acceptance'(Annexure-3), the contract has become final. It is further stated that since the petitioner failed to sign a formal agreement and insisted on to incorporate various stipulations, which were not as per the 'Notice Inviting Tender' (NIT), the respondent had annulled the work order at the risk and cost of the petitioner in terms of the contract. It is further stated that later on, the said contract awarded to another Company namely, M/s BOC India Limited at a total value of Rs.18.84 crores. Thereafter, a Committee constituted, for 9 the purpose of determining the risk and cost amount, to be recovered from the petitioner, with the approval of the competent authority. It is further stated that the aforesaid Committee submitted its report on 04.6.2012 and recommended for claiming Rs.4,42,46,309/- from the petitioner. Accordingly, a request letter sent to the petitioner for paying the said amount. It is further stated that the petitioner had not paid the aforesaid amount, thus, the respondent-SAIL recovered it from the running contract bill of the petitioner.
It is stated that as per the Clause 34 of the terms and conditions of the bid, the respondent-SAIL is entitled to forfeit the Bid Security and recover the damages caused to it due to awarding of the contract to another agency. Thus, there is no illegality in the aforesaid deduction made by the respondent-SAIL. It is further stated that it is stipulated at Clause 6 of the general condition of the contract that for settlement of dispute or differences, the parties will take recourse of conciliation and/or arbitration. It is stated that the petitioner without resorting to the adjudication process provided in the contract, has filed the present writ application, therefore, the same is not maintainable.
It is worth mentioning that no counter affidavit filed on behalf of the respondent no.2-MECON Limited.
7. Sri Sunil Kumar, Senior Advocate, appearing for the petitioner submits that the action of respondents in 10 deducting Rs.4,42,46,309/- from the bill of the petitioner, relating to another contract, is arbitrary and violative of Article 14 of the Constitution of India. He further submits that whether the petitioner was responsible for non- execution of the contract has not been decided by any adjudicatory forum. He submits that the petitioner claims that agreement had not been executed, due to fault of the respondent, under such circumstance, the action of the respondent, in deciding the above issue is unilateral, thus, not permissible in the law. He further submits that it is settled principle of law that the question of the breach of the contract as well as the assessment of quantum of damage is required to be adjudicated by the Court or Arbitral Tribunal. Sri Kumar, further submits that in the instant case, both the parties are blaming each other for the breach of the contract. Under the said circumstance, before invoking the penalty clause for the breach of the contract, it is necessary to refer the dispute to an Arbitral Tribunal, but in spite of doing so, the respondent-SAIL decided the dispute itself and levied penalty for the breach of the contract. Thus, the above action of the respondent is arbitrary. It is further submitted that deduction of amount of Rs.4,42,46,309/- from another contract is against the law and violative of the principle of natural justice, because the Committee constituted by the respondent- SAIL had not given any opportunity of hearing to the petitioner. It is further submitted that the Hon'ble 11 Supreme Court in Union of India and others Vrs. Tantia Construction Private Limited reported in (2011) 5 SCC 697 has held that an alternative remedy is not an absolute bar to the invocation of the writ jurisdiction of the High Court. It is submitted that the Hon'ble Supreme Court further held that in a suitable case, a writ jurisdiction can be invoked, even if an arbitration clause is available in the agreement.
8. On the other hand, Sri Rajeev Ranjan, Senior Advocate, appearing on behalf of the respondent-SAIL, submits that after issuance of 'Letter of Acceptance' in favour of the petitioner, on several occasions, the respondents requested the petitioner to sign the agreement, but the petitioner failed to sign the formal agreement and insisted on to incorporate various stipulations, which were not as per the NIT. He further submits that the aforesaid action of the petitioner is violative of Clause 32 of the terms and conditions of the contract. Accordingly, as per Clause-34 of the contract, the respondent-SAIL forfeited the Bid Security and deducted Rs.4,42,46,309/- from the bill of the petitioner, relating to another contract, which is required to be paid by the respondent-SAIL. Sri Rajeev Ranjan, further submits that the dispute between the parties arose from the terms and conditions of the contract and Clause-6 of the said contract provides that if any dispute arose between the parties, the same will be resolved through conciliation and/ 12 or arbitration. Accordingly, Sri Rajeev Ranjan, submits that there is an effective remedy provided in the terms of contract, therefore, the present writ application is not maintainable.
9. Having heard the submissions, I have gone through the record of the case. From perusal of the pleadings of the parties, it is clear that there is dispute between the parties as to who was responsible for the breach of the contract?
10. The case of the petitioner is that the respondent-SAIL had not incorporated the details of technical deviations, which the petitioner had mentioned in its bid paper. On the other hand, the case of the respondent-SAIL is that the petitioner is not signing the bid paper and insisting on to incorporate various stipulations, which were not mentioned in NIT. Clause-32 and 34 of the terms and conditions of the contract runs as follow-
"32. Signing of Contract Agreement 32.1 After the Employer notifies the successful Bidder that its bid has been accepted, the Employer to facilitate signing of contract within 30 days of Letter of Acceptance(LOA), shall provide the draft Contract agreement within 15 days of issue of (LOA). 32.2 Within 15(fifteen) days from the date of receipt of the draft Contract Agreement by the Contractor, the Contract Agreement will be signed. In the case of consortium becoming the Successful Bidder, all the members of the consortium shall be signatories to the Contract.13
32.3 The Effective Date of Contract shall be the date of signing of Contract or 30 days from date of Letter of Acceptance (LOA), whichever is earlier.
34. Risk Purchase Action 34.1 Failure of the successful Bidder to comply with the requirements of ITB Clause 32 or Clause 33 shall constitute sufficient grounds for the annulment of the award, forfeiture of the bid security and execution of facilities at the risk and cost of the successful bidder."
11. From perusal of Clause-32.1, I find that it is the responsibility of the employer to send the Draft Agreement within 15 days of the issue of LOA and if the same has been sent within the aforesaid time frame, then it is the responsibility of the contractor to sign the agreement within the next 15 days. Clause-34 says that if the bidder fails to comply the requirement of Clause 32, then the work award can be annulled and the Bid Security could be forfeited and in that events, the execution of facility would be at the risk and cost of the successful bidder. Thus, from perusal of the aforesaid terms and conditions of the contract, it is clear that before forfeiting the Bid Security, furnished by the bidder and execution of facility at the risk and cost of the bidder, it is mandatory to decide that the bidder had failed to comply the requirement of the Clause-32.
12. In the instant case, from the documents available on record, it appears that the respondent-SAIL had determined the alleged breach against the petitioner. In 14 my view, the respondent-SAIL is not competent to determine the aforesaid question.
13. The Hon'ble Supreme Court in the State of Karnataka Vrs. Shree Rameshwara Rice Mills reported in (1987) 2 SCC 160, at paragraph nos. 7 and 8 held as under:
"7.......Even assuming for argument's sake that the terms of Clause 12 afford scope for being construed as empowering the officer of the State to decide upon the question of breach as well as assess the quantum of damages, we do not think that adjudication by the officer regarding the breach of the contract can be sustained under law because a party to the agreement cannot be an arbiter in his own cause. Interests of justice and equity require that where a party to a contract disputes committing of any breach of conditions the adjudication should be by an independent person or body and not by the other party to the contract. The position will, however, be different where there is no dispute or there is consensus between the contracting parties regarding the breach of conditions. In such a case the officer of the State, even though a party to the contract will be well within his rights in assessing the damages occasioned by the breach in view of the specific terms of Clause 12.
8. We are, therefore, in agreement with the view of the Full Bench that the powers of the State under an agreement entered into by it with a private person providing for assessment of damages for breach of 15 conditions and recovery of the damages will stand confined only to those cases where the breach of conditions is admitted or it is not disputed."
14. The same view reiterated by the Hon'ble Supreme Court in J.G. Engineers Private Limited Vrs. Union of India and another reported in (2011) 5 SCC 758, at paragraph no. 19, which runs as follow-
"19. In fact the question whether the other party committed breach cannot be decided by the party alleging breach. A contract cannot provide that one party will be the arbiter to decide whether he committed breach or the other party committed breach. That question can only be decided by only an adjudicatory forum, that is, a court or an Arbitral Tribunal."
15. Thus, the question whether the petitioner was responsible or the respondent was responsible for committing breach of terms and conditions of the contract is required to be adjudicated either by a Court or by an Arbitral Tribunal. The same cannot be decided by the respondent-SAIL, who alleges that petitioner had committed such breach.
16. In this respect, it is pertinent to mention that the petitioner vide annexure-38, requested the Chief Executive Officer, Steel Authority of India Limited(SAIL) for referring the dispute for arbitration either by the 'SCOPE Forum' or by some other 'Forum', with the agreement of both parties. 16 It appears that in response to the aforesaid letter of the petitioner, the Chief Executive Officer of the respondent- SAIL vide Annexure-39, appointed Sri Diwakar Panigrahi, Ex. G.M., (Project), SAIL, as the sole arbitrator for adjudication of dispute arising out of the Global Tender dated 16.2.2010. It is stated that Sri Diwakar Panigrahi, Ex. G.M., (Project) was actively associated in respect of Global Tender dated 16.2.2010 on behalf of the respondent-SAIL. It further appears that the petitioner vide Annexure-40, has objected to the appointment of Sri Diwakar Panigrahi, because he was signatory of letter dated 21/22.12.2012, whereby the petitioner was directed to pay Rs.4,42,46,309/- to the respondent-SAIL as damages.
17. Thus, it appears that the respondent-SAIL also agreed that a dispute exist between the parties, in connection with the Global Tender dated 16.2.2010, but in spite of that it wants to get the said dispute determined through its own person, which is against the law laid down by the Hon'ble Supreme Court in Indian Oil Corporation Limited and Others Vrs. Raja Transport Private Limited reported in (2009) 8 SCC 520.
18. Since the aforesaid dispute relating to breach of the contract has not been decided as yet, therefore, at this stage, the petitioner, cannot be held, liable to pay the damages under Clause 34 of the terms and conditions of the bid.
17
19. Even assuming that the petitioner had committed the breach of the terms and conditions of the bid, then also I find that the respondent-SAIL has illegally forfeited Security Bid and deducted Rs.4,42,46,309/- from another contract bill of the petitioner. It has been held by the Hon'ble Supreme Court in Maula Bux Vrs. Union of India reported in (1969) 2 SCC 554, at paragraph no.6 that-
"6........It is true that in every case of breach of contract the person aggrieved by the breach is not required to prove actual loss or damage suffered by him before he can claim a decree, and the Court is competent to award reasonable compensation in case of breach even if no actual damage is proved to have been suffered in consequence of the breach of contract. But the expression "whether or not actual damage or loss is proved to have been caused thereby" is intended to cover different classes of contracts which come before the Courts. In case of breach of some contracts it may be impossible for the Court to assess compensation arising from breach, while in other cases compensation can be calculated in accordance with established rules. Where the Court is unable to assess the compensation, the sum named by the parties if it be regarded as a genuine pre- estimate may be taken into consideration as the measure of reasonable compensation, but not if the sum named is in the nature of a penalty. Where loss in terms of money can be determined, the 18 party claiming compensation must prove the loss suffered by him."(emphasis added)
20. The same view taken by the Hon'ble Supreme Court in Union of India Vrs. Rampur Distillery and Chemical Co., Ltd. reported in (1973) 1 SCC 649, at paragraph no.3, which runs as follow:
"3.......But, "where under the terms of the contract the party in breach has undertaken to pay a sum of money or to forfeit a sum of money which he has already paid to the party complaining of a breach of contract, the undertaking is of the nature of a penalty". It was further held that the amount deposited by way of security for guaranteeing the due performance of the contract cannot be regarded as earnest money."
21. Thus, in view of the aforesaid law laid down by the Hon'ble Supreme Court, it is clear that the stipulations made at Clause 34 of the terms and conditions of the contract is penal in nature. Under the aforesaid circumstance, it is mandatory for the respondent-SAIL to prove the loss or damages suffered by it and then only it can claim reasonable compensation.
In the instant case, up-till now no adjudicatory authority has determined the loss suffered by the respondent-SAIL. Under the aforesaid circumstance, in my view, the forfeiture of Bid Security of Rs.5 lacs and deduction of Rs.4,42,46,309/-, on account of execution of 19 facilities at the risk and cost of the petitioner, is not tenable in law.
22. I have already come to the conclusion that the action of the respondent-SAIL in deciding that the petitioner is liable for the breach of the contract is illegal and arbitrary. Therefore, in the instant case, notwithstanding that there is a provision relating to the arbitration in the terms of agreement, I am of the view that this writ application is maintainable. In a similar circumstance, in Union of India and others Vrs. Tantia Construction Private Limited(Supra), the Hon'ble Supreme Court at paragraph nos. 33 and 34, held as follow:
"33. Apart from the above, even on the question of maintainability of the writ petition on account of the arbitration clause included in the agreement between the parties, it is now well established that an alternative remedy is not an absolute bar to the invocation of the writ jurisdiction of the High Court or the Supreme Court and that without exhausting such alternative remedy, a writ petition would not be maintainable. The various decisions cited by Mr. Chakraborty would clearly indicate that the constitutional powers vested in the High Court or the Supreme Court cannot be fettered by any alternative remedy available to the authorities, Injustice, whenever and wherever it takes place, has to be struck down as an anathema to the rule of law and the provisions of the Constitution.20
34. We endorse the view of the High Court that notwithstanding the provisions relating to the arbitration clause contained in the agreement, the High Court was fully within its competence to entertain and dispose of the writ petition filed on behalf of the respondent Company. We, therefore, see no reason to interfere with the views expressed by the High Court on the maintainability of the writ petition and also on its merits."
23. Thus, in view of the law laid down by the Hon'ble Supreme Court, the point of maintainability raised by Sri Rajeev Ranjan, senior counsel for the respondent-SAIL, cannot be accepted.
24. Since up-till now, it is not clear that the petitioner is liable for the breach of the contract and thus, liable to pay penalty under Clause 34 of the Agreement and also taking in to account that the Chief Executive Officer of the respondent-SAIL agreed to refer the dispute before an arbitrator, therefore, equity demands that the respondent- SAIL shall refund the amount already deducted and forfeited from the account of the petitioner. I am taking aforesaid view, specially keeping in mind that the petitioner has ongoing contract with the respondent-SAIL (Bokaro Steel Plant) and it gets net payment of about Rs.7 crores per month from the said contract. Thus, if ultimately, the respondent succeeds in the arbitration proceeding, it can deduct damages from the future bills of 21 the petitioner. Thus, if at present, the respondent will refund the aforesaid amount to the petitioner, no prejudice will be caused to it.
25. In view of the discussions made above, I allow this writ application and give following directions to the respondent-SAIL :
(i) To refund Rs.4,42,46,309/- with interest @ 8% p.a. calculated from 25.10.2013 to the petitioner, which the respondent had admittedly deducted from the bill of the petitioner arising out of contract No. TC/M/AGT-916, dated 19.5.2006 (Annexure-34) and;
(ii) To refund the Bid Security amount i.e., Rs. 5 lacs to the petitioner with interest @ 8% p.a., which the respondent-SAIL admittedly received after invoking the bank guarantee furnished by the petitioner and;
(iii) The respondent-SAIL shall refer the dispute to an independent arbitrator with the consent of the petitioner for adjudication of dispute relating to Global Tender, dated 16.2.2010.
(iv) The parties shall bear their own cost.
(Prashant Kumar, J.) Jharkhand High Court, Ranchi Dated: 09 / 09/2015 Sudhir/NAFR