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4. Being aggrieved by this illegal action petitioner filed Writ Petition No. 3961/08 before this Court, this Court issued notice and found that the contract was cancelled without giving opportunity of hearing to the petitioner and without issuing any show-cause notice to them, accordingly the order dated 27.7.2006 Annexure P/13 was quashed and vide order dated 30.1.2006 Annexure P/14 this Court directed respondent No. 4 The Chief General Manager (CM) National Highways Authority of India, to issue notice to the petitioner on the basis of facts that have come in the inquiry report, furnish a copy of the inquiry report and decide the matter afresh after giving opportunity of hearing to the petitioner. Accordingly it is stated that respondent Nos. 1 to 5 became annoyed with the petitioner because of filing of this petition and they started harassing the petitioner, on 6.11.2006 petitioner sent a notice to the respondents seeking surrender or termination of contract under Clause 34(1)(II) of the agreement Annexure P/5,90 days notice was given on 6.11.2006, Annexures P/15 and P/16 are these notice and letters issued by the petitioner. Further grievance of the petitioner is that without considering the aforesaid letters for termination or surrender, a fresh show-cause notice dated 24.11.2006 Annexure P/17 was issued to the petitioner asking them to show cause as to why the contract should not be terminated, the performance security forfeited and the Bank guarantee revoked and petitioner punished for the illegal act of recovering excess user fee. Petitioner submitted reply to the show-cause vide Annexure P/1 8 dated 8.12.2006 thereafter, petitioner was asked to appear before the authorities for personal hearing at New Delhi on 12.1.2007. In the meanwhile petitioner preferred another writ petition being W.P. No. 6338/06 for quashing the second show-cause notice Annexure P/17 issued on 24.11.2006, however this Court refused to interfere in the matter as only a show cause notice was issued. This second writ petition being WP No. 6338/06 was disposed of vide order Annexure P/19 dated 13.12.2006 with a direction to the respondents to decide the matter after following the principles of natural justice and affording full opportunity of hearing to the petitioner and after considering the application for surrender/termination of contract submitted by them under Clause 34(1)(II) of the agreement. It is seen that after this order was passed petitioner was called for personal hearing on 12.1.2007, petitioner company appeared through their Director Sanjay Garg and thereafter impugned orders have been passed and action taken. By the impugned orders as indicated hereinabove the contract of the petitioner has been cancelled, the performance security of Rs. 2,20,00,125/- has been forfeited and a penalty of Rs. 2,41,097/- is imposed upon the petitioner, these three actions are taken in accordance with Clause 18 of the contract agreement Annexure P/5, thereafter, the letter Annexure P/2 is issued to the Bank for revocation of Bank guarantee on the ground that the contract has been cancelled under Sub-clause 2 of Clause 34 due to breach committed by the petitioner. Challenging the aforesaid action of the respondent Nos. 1 to 5 Mr. A.K. Chitley Senior Counsel who has argued the matter at length on behalf of the petitioner submitted that the entire action has been taken and termination of the contract is brought out on the allegation of charging excess user fee in a section of the National Highway in question, these allegations of charging excess user fee is not proved. Mr. Chitley, Senior Counsel points out that there is no cogent evidence available on record to show that the allegations are correct, the allegations are held to be proved on the basis of certain complaints said to have been submitted against the petitioner mainly by M/s. Rinku Transport Company, Morena. It is submitted that M/s. Rinku Transport Company, Morena had submitted similar complaint not only against the petitioner but also against the contractor of Baretha Toll Plaza, subsequently the complaint submitted against Baretha Toll Plaza was withdrawn and no action was taken against this contractor. Inter alia contending that M/s. Rinku Transport Company, Morena has submitted complaint on false ground and the action is taken against the petitioner without giving them proper opportunity of hearing, petitioner seeks interference in the matter. Mr. Chitley, Senior Counsel points out that in this case certain inquiry were conducted behind the back of the petitioner, certain agencies from Gurgeon and Delhi were appointed for investigating into the allegations of charging excess fee and the report of the said agency formed the basis for taking action. However, the agency conducted the inquiry behind the back of the petitioner, petitioner was never informed about the inquiry, evidence were collected by this agency without notice and knowledge of the petitioner. It is emphasized that on the basis of such a inquiry no action can be taken against the petitioner. Mr. A.K. Chitley, Senior Counsel also submitted that in spite of order passed by this Court in W.P. No. 3961/06 and W.P. No. 638/06 proper opportunity for giving evidence was not extended to the petitioner. Witnesses who had deposed against the petitioner and on the basis of which report was submitted by the agency were not made available for cross-examination, petitioner was not afforded assistance of lawyer to represent it in the personal hearing that was held at New Delhi on 12.1.2007. It was emphasized by Mr. A.K. Chitley, Senior Counsel that on 12.1.2007 Director of the petitioner company Sanjay Garg was present alone whereas the National Highway Authority was represented by more than 5 persons namely Mr. S.C. Jindal, CGM (CM). Mr. Vishal Gupta, GM(CO), Mr. Aswani Kumar, Project Director, Agra, Mr. K.D. Saini, SAO, Mr. A.K. Goyal, Manager (CO), petitioner was handicapped in facing all these 5 persons in the personal hearing. It was also submitted that petitioner had submitted documents Ex. P/100 to P/120 all these documents issued by various transport companies indicated that petitioner had never collected excess charges, ignoring these documents produced, action taken only on the basis of complaint of M/s. Rinku Transporters which is a mala fide complaint is argued to be illegal. Mr. Chitley, Senior Counsel argued that the entire action was taken by violating the principles of natural justice and without granting proper opportunity to give evidence and hearing to the petitioner, the entire action taken being contrary to the principles of natural justice stands vitiated.

5. It was further emphasized by learned Counsel that action taken for revocation of the Bank guarantee is illegal, the Bank guarantee was furnished to compensate the loss caused due to breach of contract, in the present case no loss is caused to the respondents and, therefore, revocation of the Bank guarantee without any loss being caused is said to be unsustainable. It was emphasized by Mr. A.K. Chitley, Senior Counsel that the action taken by the Chief General Manager is without jurisdiction as it is only the Project Director who is empowered to take action as per the contract and as the action is taken by CGM who is not the Competent Authority as per the agreement, the entire action stand vitiated.

9. As far as the merits of the claim made by the petitioner is concerned Mr. K.N. Gupta, Sr. Counsel emphasized that in the present case immediately after the contract was granted to the petitioner respondents started receiving complaints with regard to collection of excess user fee by the petitioner. Inviting my attention to the gazette notification issued prescribing the schedule of fee to be collected from various vehicles passing through the plaza, contained in page 60 to 72 of the return filed by respondent Nos. 1 to 5. It is emphasized that petitioner was found to be indulging in collection of excess user fee from various persons. It was found that petitioner was collecting user fee even from vehicles which were exempted from payment of fee. It is further pointed out by the learned Sr. Counsel that the plaza was handed over to the petitioner on 1st April, 2006 and within a few days thereafter, complaints were received from Morena Kerosene Dealers Association on 7.5.2006, pointing out that petitioner is charging excess fee from vehicles passing through the plaza and is indulging in unfair means in the matter of collecting user fee. Mr. Gupta invited my attention to the complaints received from various organizations on 6.5.2006 as contained in page 75, receipts issued by the petitioner for collection of user fee as contained in pages 74-76 and other documents filed along with the return of respondent Nos. 2 to 5 to point out that petitioner was indulging in various illegal activities and, therefore, action was taken against him respondents have filed copies of the complaints received from the road users passing through the plaza. It was found that petitioner was charging Rs. 232.54 against a permissible charge of Rs. 155 from HCM and EME vehicles and from truck and buses was charging higher amount, instead of the prescribed amount of Rs. 70/- an amount of Rs. 105/- was being charged. It is stated that because of the aforesaid irregularities notices were issued to the petitioner on 29.5.2006, petitioner's reply was found to be unsatisfactory and, therefore, a independent agency was employed to conduct investigation into the matter, from 1st June, 2006 to 5th June, 2006 members of the agency in various vehicles conducted operation in the Agra-Dhaulpur-Morena section of the Highway for verifying the complaints received, not only with regard to user plaza of the petitioner situated in Village Choundha but also the other user plaza situated at Baretha, after conducting a discreet inquiry into the matter the team/agency submitted a detailed report Annexure R/7. This report clearly established the allegations levelled against the petitioner with regard to charging excess user fee, the team also submitted certificate and receipts issued by the petitioner during the period of verification along with their report Annexure R/7 i.e., from page 106 to 126, of the return accordingly action was taken against the petitioner, after the earlier order passed on 27.7.2006 Annexure R/10 was quashed by this Court, afresh show-cause notice was issued. Petitioner submitted reply to the said show-cause notice and thereafter the impugned action has been taken. Mr. K.N. Gupta, learned Sr. Counsel by taking me through various documents emphasized that in this case an inquiry as is normally conducted in a departmentally or domestic inquiry is not required, the inquiry has to be in such a manner that the modus operandi of the petitioner can be established. Learned Sr. Counsel emphasized that no officer of the respondents is biased and prejudiced against the petitioner, there is no allegation of personal bias and prejudice or mala fide and as the entire action is taken after giving a fair opportunity of hearing which included a personal hearing at New Delhi on 12.1.2007, it is argued that there is no violation of the principle of natural justice. However emphasizing that the entire action is taken after giving due opportunity of defence and representation to the petitioner Mr. K.N. Gupta, Sr. Counsel argued that no case for interference in the matter is made out. It was submitted that once breach of contract is proved respondents are entitled to take action in accordance with the terms and conditions of contract, as the action of cancelling the contract, imposing the penalty and forfeiting the performance security and revocation of Bank guarantee is taken strictly in accordance with terms and conditions of contract. Learned Counsel argued that no case for interference exercising jurisdiction under Articles 226/227 of the Constitution is made out.

31. As per letter Annexure P74 dated 14.3.2006 Bank guarantee to the tune of Rs. 2,20,00,125/- that is a amount equal to three months' agreed remittance is submitted in a proforma prescribed by the National Highway Authority, the Bank guarantee submitted is valid upto 30th June, 2007 i.e. Annexure R/19. A perusal of this guarantee indicates that Central Bank of India a body corporate constituted under the Banking Regulation Act having its head office at Chandra Mukhi, Nariman Point, Mumbai, and branch, at Jyandra Ganj, Gwalior on the request of petitioner contractor has agreed to give to the respondents authority guarantee for an amount not exceeding 2,20,00,125/- and this guarantee is against any loss or damage caused to or suffered or would be caused to or suffered by reason of any breach by the said contractor of any of the terms and conditions of the said contract. It is clear from a perusal this Bank guarantee indicates that the guarantee is to compensate for the loss or damage caused because of breach. Under Clause 18, what is to be forfeited is the amount of performance security which is given under Clause 17, the Bank guarantee is, therefore, in addition to the security towards performance as contemplated under Clause 17(a) of the agreement, the Bank guarantee is an additional guarantee for any loss or damage caused or suffered due to breach. In the present case because of breach committed penalty under Clause 18 is already imposed, the breach is only of charging excess fee from the road users not other breach is alleged or established, no other loss or breach or illegality is established or proved. Under such circumstances the question is as to whether after having imposed the penalty and action taken as contemplated under Clause 18 of the contract agreement, revocation of Bank guarantee also to the tune of Rs. 2,20,00,125/-Le.,a sum equal to three months remittance is reasonable, which can be termed as fair and justified.