Madhya Pradesh High Court
M/S Tulsi Narayan Garg Sarawagi Mohalla ... vs The M.P. Rural Road Developmentt ... on 12 July, 2021
Author: Sheel Nagu
Bench: Sheel Nagu
1 HIGH COURT OF MADHYA PRADESH
W.P.No.16245/2020
{M/s Tulsi Narayan Garg
Vs.
The M.P. Rural Road Development Authority & Ors.}
Gwalior, Dated : 12.07.2021
Shri D.S. Raghuvanshi, learned counsel for the petitioner.
Shri Vivek Khedkar, learned counsel for the respondents.
With consent heard finally through video-conferencing. Per Justice Anand Pathak J;
1. The present petition is preferred under Article 226 of Constitution of India, being crestfallen by action/inaction of the respondents whereby security deposit of petitioner company has not been refunded despite issuing completion certificate as well as utility certificate by the competent authority.
2. It is the submission of learned counsel for the petitioner that petitioner was given a contract for construction of T-05 (Dhoti) to Asida Road, Ashida to Kamarsali Road, L-04 to Dubri and Dubri to Gurunavda. Work was completed and so as the 5 years maintenance period. Since completion certificate was issued on 22-03-2013 and defect liability period of 5 years was also completed successfully which is evident from the report of inspection team issued in this regard by way of utility certificate (Annexure P/3), therefore, petitioner has right to get his performance guarantee to the tune of Rs.19,37,900/- which is required to be refunded under the contract. Since same has not been refunded, therefore, petitioner is before this Court. 2 HIGH COURT OF MADHYA PRADESH W.P.No.16245/2020 {M/s Tulsi Narayan Garg Vs. The M.P. Rural Road Development Authority & Ors.}
3. Learned counsel for the petitioner also placed the order dated 30-08-2019 passed by the Apex Court in Civil Appeal No(s).6726-6729 of 2019 (M/s Tulsi Narayan Garg Vs. The M.P. Road Development Authority) and submitted that the Apex Court has decided the said controversy and still the respondents have not followed it.
4. Per contra, learned counsel for the respondents opposed the prayer and submitted that petitioner has not placed the facts in correct perspective. It is apparently true that subject work was completed within time and completion as well as utility certificates were issued but it is the clause 43.4 which includes any amount arises not only under the subject contract but any other contract which entitles the employer to effect recovery thereof and invoke said clause of General Conditions of Contract Part I, respondents have not settled the amount because the work of petitioner regarding MP3712, MP3717, MP3714 and MTN 5 in spite of all efforts, petitioner could not able to complete the work and on account of aforesaid, termination order was issued and the amount of Rs.164.97 lacs is required to be recovered from the petitioner. For that purpose, appropriate action has been initiated by the department. Therefore, security amount has been withheld. Petitioner has alternative remedy 3 HIGH COURT OF MADHYA PRADESH W.P.No.16245/2020 {M/s Tulsi Narayan Garg Vs. The M.P. Rural Road Development Authority & Ors.} to approach the Arbitral Tribunal and same cannot be adjudicated here. Respondents relied upon the order dated 22- 04-2019 passed in Writ Petition No.26373/2018 wherein Division Bench of this Court has clarified the position while considering clause 43 of General Condition of Contract Part I.
5. Heard learned counsel for the parties through video-
conferencing and perused the record.
6. In the case in hand, petitioner contractor is seeking refund of amount which has been completed successfully by the petitioner and utility certificate for maintaining the roads for 5 years has been issued by the department. It is also true that certain other projects of petitioner are incomplete and were left in lurch, therefore, amount of Rs.164.97 lacs has been sought to be recovered from the petitioner and for that security amount of Rs.19,37,900/- has been withheld. This aspect has been considered by the Division Bench of this Court in Writ Petition No.26373/2018. Relevant discussion is reproduced for ready reference:
"10. The issues which crop up for consideration are as to whether the petitioner is entitled for the refund of amount of performance guarantee. Secondly, whether the respondents are justified in withholding the amount as there exists liability of the petitioner under other 4 HIGH COURT OF MADHYA PRADESH W.P.No.16245/2020 {M/s Tulsi Narayan Garg Vs. The M.P. Rural Road Development Authority & Ors.} contract.
11. True it is that Clause 43 of GCC Part I provides the manner of Security deposit/Retention and release of performance security and security Deposit/Retention Clause 43.4 besides stipulating that the performance security equal to the five percent of the contract price and additional performance security for Routine maintenance as detailed in Clause 51 of Condition of Contractor is repaid to the contractor when the period of five years fixed for Routine maintenance is over and the Engineer has certified that the contractor has satisfactorily carried out the Routine Maintenance of the works. This Clause however, further stipulates that:
"if the Routine maintenance Part of the contract is not carried out by the Contractor as per this contract, the employer will be free to carry out Routine maintenance work and the amount required for this work will be recovered from the amount of performance security available with the employer and/or from any amounts of the Contractor whatever is due. As evident from the contract documents of Package No.MP 3712, MP3714, MP 3717 and MP 37MTN005 similar Clause appear in these agreement. The connotation "and/or from any amounts of the Contractor whatever is due," in our considered opinion is in contradistinction with the earlier part of Clause 43.4, and will include any amount arising not only under the subject contract, but any other contract, which entitles the employer to effect recovery thereof.
5 HIGH COURT OF MADHYA PRADESH W.P.No.16245/2020 {M/s Tulsi Narayan Garg Vs. The M.P. Rural Road Development Authority & Ors.}
12. Furthermore, Clause 50 of GCC Part I stipulates:
"50. Final Account 50.1 The Contractor shall supply the Engineer with a detailed account of the total amount that the Contractor considers payable for works under the Contract within 21 days of issue of certificate of completion of construction of works. The Engineer shall issue a Defects Liability Certificate and certify and payment that is due to the Contractor within 42 days of receiving the Contractor's account if it is correct and complete. If the account is not correct and complete, the Engineer shall issue within 42 days a schedule that states the scope of the corrections or additions that are necessary. If the Account is still unsatisfactory after it has been resubmitted, the Engineer shall decide on the amount payable to the Contractor and issue a payment certificate within 28 days of receiving the Contractor's revised account. The payment of final bill for construction of works will be made within 14 days thereafter.
50.2 In case the account is not received within 21 days of issue of Certificate of Completion as provided in clause 50.1 above, the Engineer shall proceed to finalise the account and issue a payment certificate within 28 days. The payment of final bill for construction of works will be made within 14 days thereafter.
50.3 The Contractor shall supply the Engineer with a detailed account of the total amount that the Contractor considers payable under the contract 21 days before the end of the Routine Maintenance Period. The Engineer shall issue a Routine Maintenance Completion Certificate and certify and final payment that is due to the Contractor within 42 days of receiving the Contractor's account if it is correct and complete. If it is not, the Engineer shall issue within 42 days a schedule that states the scope of the corrections or additions that are necessary. If the Final Account is still unsatisfactory after it has been resubmitted, the Engineer shall decide on the 6 HIGH COURT OF MADHYA PRADESH W.P.No.16245/2020 {M/s Tulsi Narayan Garg Vs. The M.P. Rural Road Development Authority & Ors.} amount payable to the Contractor and issue a payment certificate within 28 days of receiving the Contractors revised account. The payment of final bills for routine maintenance will be made within 14 days thereafter.
50.4 In case the account is not received within 21 days of issue of Certificate of Completion as provided in clause 50.3 above the Engineer shall proceed to finalise the account and issue a payment certificate within 28 days. The payment of final bill for routine maintenance will be made within 14 days thereafter."
13. No cogent material is commended at to establish that the petitioner has exhausted the said stage which unless accomplished will not entitle petitioner for the refund under Clause 43 of GCC Part I as claimed.
14. Besides above, Clause 24 and 25 of GCC part I provides for Dispute Redressal System and the Arbitration.
15. For the reasons above, we are not inclined to cause any indulgence.
16. As no relief can be granted, petition fails and is dismissed. No costs."
7. Considering the discussion made above of Coordinate Bench in the case of petitioner itself, no ground for interference is made out.
8. So far as the judgment of Apex Court is concerned, there the question was regarding raising demand pending adjudication before Arbitral Tribunal raised and that has been answered by the Apex Court. Said judgment moves in different factual realm 7 HIGH COURT OF MADHYA PRADESH W.P.No.16245/2020 {M/s Tulsi Narayan Garg Vs. The M.P. Rural Road Development Authority & Ors.} and cannot be borrowed here for any advantage of petitioner.
9. Resultantly, petition stands dismissed but petitioner is at liberty to avail the alternative remedy before the Arbitral Tribunal in accordance with law.
10. Petition stands disposed off in above terms.
(Sheel Nagu) (Anand Pathak)
Judge Judge
Anil*
ANIL Digitally signed by ANIL KUMAR
CHAURASIYA
KUMAR
DN: c=IN, o=HIGH COURT OF MADHYA
PRADESH BENCH GWALIOR, ou=HIGH
COURT OF MADHYA PRADESH BENCH
GWALIOR, postalCode=474001,
CHAURASIY st=Madhya Pradesh,
2.5.4.20=8512f40a1a9eaa50b6802d068b5 1dae27e84c266b09d283f0799e67cdc7df5 A 0f, cn=ANIL KUMAR CHAURASIYA Date: 2021.07.13 10:47:43 -07'00'