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23. There was a difference of opinion and questions were raised over the fact that some contracts though having a 'force majeure' clause, do not stress on the word 'pandemic', 'epidemic', 'disease', etcetera, while majority of the contracting parties rely on the general phrase 'any other unforeseeable event, not under the control of either of the parties.'

24. On par with the private sector, Government contracts and Public Sector transactions also started suffering on account of pandemic and declaration of lockdown throughout the country. To address the situation fairly, Ministry of Home Affairs came out with Notification No. F. 18/4/2020 PPD, dated 19.02.2020 with respect to Manual for Procurement of Goods, 2017 declaring that interruptions in supply chain due to Covid 19 from China or any other country shall be covered under the ambit of 'force majeure' and that 'force majeure' shall be invoked whenever considered appropriate following the due process of law. While the power of the Ministry to bring certain events within the ambit of 'force majeure' under Clause 9.7.7 by a simple notification may be a different issue, but, as it appears, by this notification, Corona Pandemic was brought within the meaning of 'force majeure' as defined in the Manual and tacitly, this event certainly becomes applicable in respect of all government and / or public sector contracts irrespective of application of the Manual for Procurement of Goods, 2017. It may be noted that this Memorandum of 19th February 2020 was issued prior to Covid-19 affecting operations in India, recognizing the difficulty faced by the contracting parties regarding import of materials from other countries which were impacted by the pandemic.

26. The Ministry of Roads Transport and Highways also in its Circular dated 18.05.2020 inter-alia classified the pandemic as a 'force majeure' event. In addition, Ministry of Home Affairs, by its Order No. 40-3/2020(D), dated 24.03.2020 expressed that the country was threatened with the spread of Covid 19 virus and therefore, has considered to take effective measures to prevent its spread across the country and in exercise of powers under section 10(2)(I) of the Disasters Management Act, 2005, issued various guidelines for immediate implementation. Subsequently, by Office Memorandum, dated 13.05.2020, the Ministry of Finance, Department of Expenditure referred to its earlier memorandum dated 19.02.2020 and also referred to the Manual of Procurement and recognized inter-alia that in view of the prevailing restrictions, it may not be possible for the parties to the contract to fulfill contractual obligations. Therefore, after fulfilling due procedure and wherever applicable, parties to the contract could invoke 'force majeure' clause for all construction / works contracts, goods and services contracts, and PPP contracts with Government Agencies up to a certain period and subject to certain conditions. Therefore, officially, the Government of India recognized Covid-19 Pandemic as an event of 'force majeure' applicable in relation to contracts with Government Agencies, in effect, resulting inclusion of Public Sector Undertakings also.

" 27(i) The respondent Corporation itself referred to Circular dated 19.02.2020 which notified that the COVID-19 pandemic was a force majeure occurrence. In effect, the force majeure clause under the agreement immediately becomes applicable and the notice for the same would not be necessary. That being the position, a strict timeline under the agreement would be put in abeyance as the ground realities had substantially altered and performance of the contract would not be feasible till restoration of the pre-force majeure conditions."

Further, while discussing the scope of the force majeure clause in contracts it was observed by the court that:

" Para 63. It is the settled position in law that a Force Majeure clause is to be interpreted narrowly and not broadly. Parties ought to be compelled to adhere to contractual terms and conditions and excusing non-performance would be only in exceptional situations. As observed in Energy Watchdog it is not in the domain of Courts to absolve parties from performing their part of the contract. It is also not the duty of Courts to provide a shelter for justifying non- performance. There has to be a 'real reason' and a 'real justification' which the Court would consider in order to invoke a Force Majeure clause".