Gauhati High Court
M/S. T.K.Engineering Consortium Pvt. ... vs Union Of India And 6 Ors on 11 June, 2019
Author: Ujjal Bhuyan
Bench: Ujjal Bhuyan
Page No.# 1/9
GAHC010125612019
THE GAUHATI HIGH COURT
(HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
Case No. : WP(C) 3723/2019
1:M/S. T.K.ENGINEERING CONSORTIUM PVT. LTD.
M/S T.K. ENGINEERING CONSORTIUM PVT. LTD. HAVING ITS REGISTERED
OFFICE AT MODEL VILLAGE, NAHARLAGUN, DIST.- PAPUM PARE,
ARUNACHAL PRADESH, PIN-791110 AND REP. BY ITS AUTHORIZED
ATTORNEY SRI JOGA PRASAD DEKA, 50 YEARS S/O PADMA KANTA DEKA,
R/O VILL. GHONOSA, P.O. AND P.S. JAGIROAD, DIST.-MORIGAON, PIN-
782410, ASSAM
VERSUS
1:UNION OF INDIA AND 6 ORS.
REP. BY THE SECRETARY TO THE MINISTRY OF ROAD TRANSPORT AND
HIGHWAYS, GOVT. OF INDIA, TRANSPORT BHAWAN, 1, PARLIAMENT
STREET, NEW DELHI-110001
2:NATIONAL HIGHWAY AND INFRASTRUCTURE DEVELOPMENT
CORPORATION LTD.
REP. BY ITS MANAGING DIRECTOR AT 3RD FLOOR
PTI BUILDING
4
PARLIAMENT STREET
NEW DELHI-110001
3:GENERAL MANAGER (TECH)
NATIONAL HIGHWAYS AND INFRASTRUCTURE DEVELOPMENT
CORPORATION LTD. AT 3RD FLOOR
PTI BUILDING
4
PARLIAMENT STREET
NEW DELHI-110001
4:EXECUTIVE DIRECTOR (P)
Page No.# 2/9
RO-NE
NATIONAL HIGHWAYS AND INFRASTRUCTURE DEVELOPMENT
CORPORATION LTD. AT 2ND FLOOR
AGNISHANTI BUSINESS PARK GNB ROAD
AMBARI
GUWAHATI-781001
5:GENERAL MANAGER (PROJECT)
NATIONAL HIGHWAYS AND INFRASTRUCTURE DEVELOPMENT
CORPORATION LTD. AT 1ST. FLOOR
SARAF TOWER
MAZGAON
NH37
TEZPUR-784001
ASSAM
6:EXECUTIVE DIRECTOR
NATIONAL HIGHWAYS AND INFRASTRUCTURE DEVELOPMENT
CORPORATION LTD. AT 3RD FLOOR
PTI BUILDING
4
PARLIAMENT STREET
NEW DELHI-110001
7:STUP CONSULTANTS PVT. LTD.
C/O MR. BHASKAR TAMULY
FAUZDARI PATTY
KIRTAN GHAR PATH
KATH MILL CHARIALI
P.O. AND P.S- NAGAON
NAGAON-78200
Advocate for the Petitioner : MR S S DEY
Advocate for the Respondent : ASSTT.S.G.I.
WP(C) 3452/2019
1:M/S T.K ENGINEERING CONSORTIUM PVT. LTD.
HAVING ITS REGD. OFFICE AT MODEL VILLAGE
NAHARLAGUN DIST- PAPUM PARE
ARUNACHAL PRADESH
PIN- 791110 AND REP. BY ITS AUTHORIZED ATTORNEY SRI JOGA PRASAD
DEKA
Page No.# 3/9
50 YEARS S/O- PADMA KANTA DEKA
R/O- VILL- GHONOSA
P.O. AND P.S. JAGIROAD
DIST- MORIGAON
PIN- 782410
ASSAM
VERSUS
1:UNION OF INDIA AND 5 ORS
REP. BY THE SECY. TO THE MINISTRY OF ROAD TRANSPORT AND
HIGHWAYS
GOVT. OF INDIA
TRANSPORT BHAWAN
1
PARLIAMENT STREET
NEW DELHI- 110001
2:NATIONAL HIGHWAYS AND INFRASTRUCTURE DEVELOPMENT
CORPORATION LTD.
REP. BY ITS MANAGING DIRECTOR AT 3RD FLOOR
PTI BUILDING
4 PARLIAMENT STREET
NEW DELHI- 110001
3:GENERAL MANAGER (TECH)
NATIONAL HIGHWAYS AND INFRASTRUCTURE DEVELOPMENT
CORPORATION LTD. AT 3RD FLOOR
PTI BUILDING
4 PARLIAMENT STREET
NEW DELHI- 110001
4:EXECUTIVE DIRECTOR (P)
RO-NE NATIONAL HIGHWAYS AND INFRASTRUCTURE DEVELOPMENT
CORPORATION LTD. AT 2ND FLOOR
AGNISHANTI BUSINESS PARK
GNB ROAD
AMBARI
GHY-1
5:GENERAL MANAGER (PROJECT)
NATIONAL HIGHWAYS AND INFRASTRUCTURE DEVELOPMENT
CORPORATION LTD. AT 1ST FLOOR
SARAF TOWER
MAZGAON
NH-37
Page No.# 4/9
TEZPUR- 784001
ASSAM
6:STUP CONSULTANTS PVT. LTD.
C/O- MR. BHASKAR TAMULY
FAUZDARI PATTY
KIRTAN GHAR PATH
KATH MILL CHARIALI
P.O. AND P.S. NAGAON
NAGAON- 782001
Advocate for the Petitioner : MR S S DEY
Advocate for the Respondent : ASSTT.S.G.I.
BEFORE
HONOURABLE MR. JUSTICE UJJAL BHUYAN
ORDER
Date : 11-06-2019 This order will dispose of both WP(C) Nos.3452 and 3723/2019.
Heard Mr. SS Dey, learned Senior Counsel assisted by Mr. John Likha, learned counsel for the petitioner and Mr. UK Nair, learned Senior Counsel assisted by Mr. RK Talukdar, learned Standing Counsel, National Highways and Infrastructure Development Corporation Ltd. for the respondents.
Matter relates to termination of contract awarded to the petitioner by National Highways and Infrastructure Development Corporation Ltd. (Corporation) regarding four laning of National Highway (NH) 37 from end of Nagaon Bypass to Rangagara in the district of Nagaon, Assam.
Following a global tendering process, petitioner was awarded the said contract by the Corporation vide letter dated 23.12.2015 whereafter contract agreement was executed between the Corporation and the petitioner on 02.02.2016. Alleging that pace of work of the petitioner was extremely slow and that petitioner was unable to execute the work, notice for termination of contract was issued to the petitioner on 24.04.2019 giving opportunity to make representation within 15 days.
Page No.# 5/9 It is stated that petitioner submitted representation dated 02.05.2019 responding to such notice.
With the apprehension that termination letter could be issued, petitioner approached this Court by filing WP(C) No.3452/2019. It was contended on behalf of the petitioner that it was because of inability of the Corporation to offer continuous right of way throughout the stretch of work site which was allotted to the petitioner that the desired progress could not be made. Though this was brought to the notice of the Corporation, difficulties faced by the petitioner were not appreciated.
On 27.05.2019, this Court directed Mr. Talukdar, learned counsel for the Corporation to obtain instruction and passed an interim order that contract awarded to the petitioner should not be terminated. However, observation was made that petitioner should expedite execution and should place before the Court progress made in execution of the work and the road map for completion of the same.
Immediately after passing of the aforesaid order, Corporation filed an application for vacation of the said order on 29.05.2019. The said application has been registered as IA(C) No.1851/2019. It is mentioned therein that after issuance of the notice for intent to terminate on 24.04.2019, order of termination dated 24.05.2019 was issued which has been brought on record along with the application. It is, therefore, contended that the interim stay should be vacated.
Faced with the situation, petitioner has filed the second writ petition i.e., WP(C) No.3723/2019 assailing the order of termination of contract issued on 24.05.2019.
In the hearing which took place on 03.06.2019, learned counsel appearing for the Corporation was directed to produce the record. Reference was made to paragraph 16 of the impugned order where it is stated that representation of the petitioner was considered but rejected. Parties were directed to maintain status quo as on 03.06.2019.
Thereafter the matter was heard yesterday i.e., on 10.06.2019.
While Mr. Dey, learned Senior Counsel for the petitioner has reiterated his contention that it is because of failure of the Corporation to offer free right of way to enable heavy machinery of the petitioner unrestricted operation, for which progress could not be made, Mr. Page No.# 6/9 Nair, learned Senior Counsel for the Corporation has placed before the Court a bunch of documents wherefrom he contends that General Manager (P) of the Corporation had informed the competent authority that despite availability of more than 85% of encumbrance free right of way, petitioner during the last 39 months could achieve less than 20% of work progress and with the present pace of work, the project completion period is likely to be extended beyond double the original completion period, which will have adverse impact on the development of the State.
Submissions made by learned counsel for the parties have been considered. Also perused the relevant documents produced by Mr. Nair.
A perusal of the impugned termination order dated 24.05.2019 would go to show that according to the Corporation, execution of the work by the petitioner was found to be not satisfactory. Respondents had issued cure notice to the petitioner in terms of the contract agreement on 03.02.2018 followed by a warning notice on 28.02.2019. It is stated that notwithstanding the above, the defects were not cured; no intention was shown to expedite execution. According to the Corporation, petitioner has failed to achieve 30% physical progress for achieving Project Milestone II within the revised date i.e., 28.02.2018. First notice of intention to terminate contract was issued on 16.07.2018, to which petitioner submitted representation on 29.07.2018. A meeting was held on 20.11.2018 between the parties in which petitioner presented a road map till 31.03.2019 but it is stated that petitioner failed to achieve any tangible result. Reminder notice was issued on 20.03.2019; followed by the second notice of intention to terminate dated 24.04.2019. Corporation has acknowledged receipt of representation of the petitioner dated 02.05.2019. But it is contended that grounds taken by the petitioner are untenable. Accordingly, same has been rejected. Overall progress made by the petitioner is only 18.062% as on 31.03.2019 even after lapse of 100% of the project duration which is total breach of the contract. Therefore, Corporation has come to the conclusion that it is beyond the petitioner to complete execution of the work. Accordingly, the contract has been terminated.
It is seen from the documents placed on record that the total length of work allotted to the petitioner is 18.40 kilometer. Out of which encumbrance free right of way in the four lanning is 15.894 kilometers; in other words, 2.506 kilometers of length still has Page No.# 7/9 encumbrance.
In the course of hearing, attention of the Court was drawn to Article 9 of the contract agreement which deals with utilities and trees. While Clause 9.1 deals with existing utilities and roads, Clause 9.2 deals with shifting of obstructing utilities. From Clause 9.2, it is seen that the contractor shall in accordance with applicable laws and with the assistance of the authority cause shifting of any utility, including electric lines, water pipes and telephone cables to an appropriate location or alignment, if such utility or obstruction adversely affects execution of work.
From the above what is evident is that though primarily it is the duty of the contractor for shifting of obstructing utility, the authority i.e., the Corporation cannot also shy away from its responsibilities. It has to offer assistance to the contractor for shifting of obstructing utilities. It has also come on record that STUP Consultant Private Ltd. engaged by the Corporation; team leader-cum-Senior Highway Engineer had written to the Corporation on 03.04.2019 stating that ongoing work was hampered due to existence of hindrances at different locations because of which contractor failed to get continuous stretch for execution. He informed that a joint verification was conducted and as per joint verification, it was found that due to hindrances, the contractor could not execute the work on continuous stretch. Therefore, he suggested that authorities should take necessary action for handing over hindrance free stretches to the contractor to enable completion of the four lanning works.
Adverting to the contract agreement, it is seen that Article 26 thereof provides for dispute resolution. As per Article 26.1.1, any dispute, difference or controversy arising under or out of or in relation to the contract agreement shall, in the first instance, be attempted to be resolved amicably in accordance with the conciliation procedure. Article 26.1.2 stresses upon resolving of dispute by the parties promptly, equitably and in good faith. Article 26.2 deals with Conciliation. It says that in the event of any dispute between the parties, either party may call upon the Authority's Engineer, or such other person as the parties may mutually agree upon, who would be called the Conciliator, to mediate and assist the parties in arriving at an amicable settlement thereof. If mediation fails Article 26.3 provides for Arbitration at New Delhi.
Page No.# 8/9 From the above what is discernible is that petitioner has not been able to execute the contract work as per schedule. According to the petitioner, the same is because of the fact that continuous right of way throughout the stretch of work has not been handed over to the petitioner. It is beyond the petitioner on its own to get the utilities, such as, electric lines, telephone cables etc., shifted unless assistance is provided by the Corporation.
In the course of hearing, Court has also taken note of the fact that no doubt there has been considerable delay in execution of the work, but proceeding again from the stage of global tendering would lead to further prolongation of the contract. On the other hand, all stakeholders would agree that this stretch of work is part of the national highway which can be termed as the virtual lifeline of the State. Court can also take judicial notice of the fact that considerable amount of concern has been expressed by all concerned which is in the public domain regarding slow pace of four-lanning of the national highways in the State. Therefore, it is in the interest of all concerned and certainly in the public interest that the entire focus should be to expeditiously complete the work and for that purpose to remove all hindrances that may come in the way.
It is in the light of the above and taking note of the dispute resolution mechanism provided by the contract agreement, Court is of the view that parties should be relegated to the forum of conciliation as provided in the contract agreement. Further, on due consideration, Court is of the view that Deputy Commissioner, Nagaon would be the appropriate authority to act as the Conciliator.
Accordingly, Deputy Commissioner, Nagaon is directed to call both the parties within 7 days from the date of receipt of a certified copy of this order and initiate conciliation proceeding. If the Deputy Commissioner finds that it is because of non-removal of utilities from the work site which is causing hindrance in execution of the work, he shall intervene in the matter and do the needful, if necessary by using his good office so that the work can be completed as expeditiously as possible. Deputy Commissioner shall ensure that conciliation proceeding is carried out in the true spirit and concluded expeditiously preferably within 4 (four) weeks.
Page No.# 9/9 During conciliation proceeding, status quo order passed on 03.06.2019 shall continue. With the hope and expectation that parties will try to resolve the dispute promptly, equitably and in good faith, both the writ petitions are disposed of with the above observation and direction.
JUDGE Biplab Comparing Assistant