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2.3 IOCL issued a show cause notice dated 17.01.2003 to the petitioner requiring it to show cause in writing within 15 days as to why it should not be placed on the "Holiday List" and be debarred from entering into contracts with IOCL/be not de-listed from the list of approved vendors/contractors of IOCL for the following reasons, which had been elaborated in the IOCL's termination letter dated 29.10.2002:-
2) Failure to perform the contract 2.4 To this show cause notice dated 17.01.2003, the petitioner (SPSEL) submitted a reply on 18.01.2003 and denied that it had committed any breach of contract or that it had failed to perform the contract. It also denied that it had ever abandoned the site or the contract. In other words, all the purported reasons cited in the show cause notice for placing the petitioner (SPSEL) in the "Holiday List" and from debarring it from entering into any contracts with IOCL, etc., were categorically denied by the petitioner (SPSEL). On the contrary, it was alleged in the reply that the contract could not be performed because IOCL had abandoned the same (which was what was allegedly reported in the newspapers also) in view of the conditions prevailing locally in Orissa where the project was undertaken by the IOCL. It was further alleged that in several newspapers it was notified to the public that a large number of projects had been shelved, including the Paradip Refinery Project of IOCL and that the same had been stalled on 25.06.2002. Accordingly, the petitioner alleged that the project had been abandoned by IOCL and not because of any failure on the part of the petitioner (SPSEL). It was further stated in the reply dated 18.01.2003 that if the matter were to be referred to arbitration, and which it ought to be, all the facts would be clarified and settled. In the said letter, it was categorically stated as under:-
(sic)cts with Indian Oil Corporation Ltd/ de-list from the list of approved Vendors/ Contractors of Indian Oil Corporation Ltd. for the following reasons which is in conformity with the approved guidelines laid down for Holiday Listing/ de-listing of Vendors/Contractors:
1) Commitment of breach of Contract
2) Failure to perform the contract
3) Abandonment of Site/Contract However, before taking a final decision on the same, the following course of actions based on the approved guidelines for Holiday Listing are proposed:-

2.11 Also placed on record is a copy of the report of this committee dated 08.04.2003. The said report consists of 7 paragraphs. Paras 1-6 only narrate the allegations, the termination of the contracts, the proposal for placing SPSEL on the Holiday List, the issuance of show cause notices and the factum of the replies having been received. Only paragraph 7 comprises of the conclusions. It was found by the committee that SPSEL committed breach of contract, failed to perform the contract and abandoned the site/contract and sub-contracted the job to Sarkhel Construction Ltd. On basis of these purported findings, the committee concluded as under:-

b) the impugned order dated 10.04.2003 as well as the purported report of the said Committee dated 09.04.2003 does not give any reasons for arriving at the conclusions that the petitioner had committed breach of contract, failed to perform the contract, abandoned the site of the contract and had sub-contracted the job; and
c) all the issues on which the committee and IOCL has come to a premature conclusion are yet to be adjudicated upon by the arbitrator before whom the disputes of the petitioner in their entirety are pending as indicated by the order of this Court dated 17.03.2003 in AA No.35.2003.