Karnataka High Court
Shri Siddaramu vs The Commissioner on 26 February, 2013
Author: A.S.Bopanna
Bench: A.S.Bopanna
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IN THE HIGH COURT OF KARNATAKA AT BANGALORE
DATED THIS THE 26th DAY OF FEBRUARY 2013
BEFORE
THE HON'BLE MR.JUSTICE A.S.BOPANNA
W.P.No.11173/2011 c/w
W.P.No.11174/2011 (LB-RES)
W.P.No.11173/2011
BETWEEN:
Shri.Siddaramu,
Aged 63 years,
Class-I Contractor,
R/at.Rama Mandira Road,
Hosahally,
Mandya. ...Petitioner
(By Sri.Ravi.G.Sabhahit, Adv.,)
AND:
The Commissioner,
City Municipal Council,
Mandya. ...Respondent
(By Sri.J.N.Naveen for A.Nagarajappa, Adv.,)
********
This W.P. is filed under Article 226 and 227 of the
Constitution of India praying to quash the endorsement
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issued by the respondent dated 18.1.2011 produced at
Annexure - G.
W.P.No.11174/2011
BETWEEN:
N.Ravikumar,
S/o.S.Narayanappa,
Aged 47 years,
R/at.No.2012, 6th Cross,
Nehrunagar,
Mandya. ...Petitioner
(By Sri.Ravi.G.Sabhahit, Adv.,)
AND:
The Commissioner,
City Municipal Council,
Mandya. ...Respondent
(By Sri.J.N.Naveen for A.Nagarajappa, Adv.,)
********
This W.P. is filed under Article 226 and 227 of the
Constitution of India praying to quash the endorsement
issued by the respondent dated 18.1.2011 produced at
Annexure - E.
These W.P.s coming on for preliminary hearing in 'B'
group this day, the Court made the following:
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ORDER
The petitioners in these two petitions are assailing the impugned orders which are at Annexure-'G' in W.P.No.11173/2011 and Annexure-'E' in W.P.No.11174/2011. Since the issue in both these petitions are similar except the fact that two different petitioners are assailing similar action of the respondent, the petitions are heard together and disposed of by this common order.
2. The case of the petitioners as pleaded in W.P.No.11173/2011 is noticed for the purpose of narration of the facts. The petitioner contends that he is a Class-I Contractor who has undertaken several contracts with the respondent as well as with the others. When this was the position, the City Municipal Council, Mandya, had invited tenders for undertaking execution of the work under Package- I which comes under KW.2 of Standard Tender Document. In that regard, the petitioner is stated to have responded to the Short Term Tenders dated 20.4.2010. Pursuant thereto, 4 letter of acceptance dated 29.6.2010 was issued accepting the bid submitted by the petitioner. However, the petitioner contends that since in the said letter it was required that the petitioner should furnish further security deposit of 5%, the petitioner was of the opinion that the said requirement was contrary to the tender conditions and therefore, the said amount is not required to be deposited and the petitioner was not interested in undertaking the work. The respondent no doubt has thereafter awarded the work to the next successful bidder. In that circumstance, at the first instance, when the respondent has sought to forfeit the difference amount which has been deposited by the petitioners, the petitioners no doubt had approached the Consumer Forum which did not entertain the complaint and it is in that context, the petitioners are before this Court assailing the endorsements dated 18.1.2011 which are impugned at Annexures-'G' and 'E' respectively.
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3. The respondents while seeking to justify their action would contend through their learned counsel that the forfeiture of the security deposit is one of the conditions of the tender document when the bid is accepted and the work is awarded, but the Contractor failed to accept the work order and carry out the work. It is in that context, reference is made to the tender document for procurement of work where such conditions are mentioned in clauses 29 and 29.4. Reference is also made to the proceedings of the Government where relating to such tenders the security deposit was required to be deposited and in that context, when the same had not been deposited and the work order had been cancelled, the respondent gets right to forfeit the same. Learned counsel for the respondent would also refer to section 16 of the Karnataka Transparency in Public Procurement Act to contend that the petitioners, even if aggrieved, are to avail the remedy of appeal and the instant petition is not maintainable.
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4. In the light of the rival contentions, the maintainability of the instant petition is required to be considered at the outset. From the facts pleaded in the writ petitions, it is clear that the petitioners have not challenged the award of contract to the subsequent contractor. Even assuming for a moment that the contentions of the learned counsel is accepted that any dispute relating to forfeiture of difference amount is required to be considered in the appeal, in my view since in the instant case, the petitioners are only seeking with regard to refund of the difference amount which had been deposited by them and not a dispute with regard to the tender itself, the petitioners cannot be relegated to the appeal remedy more so when the petitions had been pending before this Court for nearly two years.
5. In the above background, a perusal of the facts in the instant case would indicate that the conditions of the tender is appended to the tender notification dated 20.4.2010 which is at Annexure-'A' to the petition. Condition No.8 to 7 the said conditions would require the Contractor to deposit the difference amount relating to the package amount which has been indicated therein. The subject matter in the instant petition is with regard to the refund of the said difference amount said to have been deposited by the petitioners. The question therefore for consideration is as to whether the respondent would be justified in forfeiting the said amount by considering the same in the nature of forfeiture of the security amount which is required to be deposited even as per the tender conditions and the orders passed for forfeiture of the same.
6. To consider that aspect of the matter, a perusal of the letter of acceptance would indicate that the respondent for the first time has intimated to the petitioners that in view of the acceptance of the bid submitted by the petitioners, the petitioners are required to furnish the security deposit in the form as detailed in para 29.1 of ITT as indicated in the respective letter of acceptance. In fact at this juncture, a 8 dispute has arisen between the petitioners and the respondent. Insofar as the petitioners, it is their case that the requirement of deposit of such security amount was not a requisite condition known to the petitioners when they had responded to the Short Term Tenders. In such circumstances, immediately on the same being brought to the notice of the petitioners, the petitioners have indicated their unwillingness to proceed further with the matter. Immediately thereafter, the respondents have entrusted the work to another Contractor. When the said security deposit was not made and the forfeiture of such security deposit is not for any other breach which has been committed thereafter after the petitioners have acceded to the same and deposited the same, the respondent would not be justified in forfeiting the difference amount which has been deposited by the petitioners which was the requirement for participating in the Short Term Tender process as the difference amount was required to be deposited as provided vide condition No.8 to the Short Term Tender.
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7. Therefore, in my considered view, the respondent would not be justified in forfeiting the difference amount which had been deposited by the petitioners. The impugned endorsement at Annexure-'E' and 'G' dated 18.1.2011 stands quashed. The respondent is now directed to refund the amount which had been deposited by the petitioners as difference amount. The disbursement shall be made as expeditiously as possible, but not later than six weeks from the date on which a certified copy of this order is furnished to the respondent.
8. Both these petitions are disposed of in the above terms. No costs.
Sd/-
JUDGE Bss.