HIR 6H COURT OF CHHATI'ISGARH AT BILASPUR Wrif Pefi‘h‘on (C2 No.6835 of 2008 PETITIONER: x M/s Singhal En’rer-prises Versus Chhaffisgarh STa‘re Elecfr‘icify Board and oTher‘s RESPONDENTS: a ORDER FOR CONSIDERA IION ‘ \V Sd/~ Dhirendra Mishra Judge R‘— HON'BLE SHRI RN. CHANDRAKAR J J ckW’l/LL N Sd/— R.N. CHANDRAKAR. 9 Dhirendra Mishrai’ Judge r -\: “a Judge Rx PosT FOR ORDER onw-z-zoio \, Sd/- 3 ‘ Q9 HIGH COURT OF CHHATTISGARH AT BILASPUR Wri‘f Pe’rifion (C) No.6835 of 2008 PETITIONER: M/s Singhal Enfer'prises (Con‘rmc’ror) having i’rs Head Office at ByePass Road, Chas, Bokaro Sfeel Ci‘ry (J'har'khand), Camp Office a’r Minocha Colony, Opp. Vidya Garden, Bilaspur (CG) ’rhr‘ough ifs Parfner' Bal Krishna Agrawal, S/o Lafe Shri Bishan Swaroop Agrawal, aged abouf 60 years, R/o A-15, Phase 1, Raj Kishore Nagar, Sipa‘r Road, Bilaspur (CG) Versus Chha’r’risgarh Sfafe EIecTriciTy Board, fhrough ifs Secre’rary, C.S.E.B., Raipur (CG) 2. Chief Engineer (Civil-Projecf) Chhaffisgarh Sfa’re Elec’rricify Board, Raipur (CG) 3. The Sfaff Officer of Member (Gen— Projec’r), CSEB, Raipur (CG) RESPONDENTS: Present: Smf. Renu Kochar, counsei for fhe pefh‘ioner. Shri Aiok Bakshi, counsel for the respondenfs. Division Bench: Hon. Shri Dhirendra Mishra & Hon. shri R.N. Chandrakar J'J. O R E R (Passed on Q3 ebruary, 2010) The following order of The Courf was passed by Dhirendra Mishra, J. The pefi’rioner has filed This pefifion and prayed for quashing of fh order of Annexure-P/IZ passed by responden‘r No.2 whereby earnesf money of Rs.8.75 lakhs deposi’red by fhe pefi'rioner has been forfei'red . e _ and fhe pe‘rh‘ioner has rayed o a direcfion To responden’r No.2 1‘0 refund he above amounf wi‘rh inerest @ 12% per annum. 2. Befly s’raed facts of The case are Thaf in response ’ro ’rhe no’rice inviTing “render of Annexure—P/l, ’rhe pe‘ri‘rioner submih‘ed his offer for ’rhe work of consfrucfion of 100 unif residen‘l‘ial quarters for 2 x 250 MW TPF Korba Easf valued af Rs.8.75 Crores. He also deposi'l’ed a sum of Rs.8.75 lakhs Towards fhe Earnesf Moey Deposif for shor’r EMD). Respondenf No.2 vide is memo dafed 26—2-2008 (Annexure—P/3) communicafed ’ro fhe pefi’rioner ’rha’r his fender for The aforesaid work h d as been accepTed. By The aforesai communicaTion, The peTiTioner was furTher direcTed To deposiT a sum of Rs.10,68,250/- wiThin 10 days of Te receipT of The communicaTion wiTh The Senior AccounTs Officer. The above amounf and EMD was To form iniTial SecuriTy deposiT. . The eTiTioner was also direcTed ’ro depufe any auThorized represenTaTive WiTh proper and valid Power of ATTorney To execuTe agreemenf wiThin 10 days of The receipT of The leTTer failing which earnesf money will be liable for forfeiTure. The peTiTioner was called upon To convey his accepTance of The order. I was menTioned ThaT if noThing is heard on The conTrary wiThin 10 days from The daTe of issue of The above order; iT would be presumed ThaT The eTiTioner has accepTed The order. 4. Th peTiTioner in his reply daTed 1-3-2008 (Annexure—P/4) sTaTed ’rha’r ere is difference beTween The iTem raTe and isf of Bill of QuanTify (for shorT BOQ) annexed wiTh The work rder and The bill of quanTiTy submiTTed wiTh fhe Tender and e same has been canged wiThouT his consenT. He requesTed To make necessary amendmenT in The BOQ annexed wiTh fhe work order in accordance wiTh BOQ annexed wiTh The Teder so ThaT agreemenT may be execuTed wiThi Time. p fr T f ri f n ( h h 3 p T p e Th l o Th h n n 41 . The respondents vide memo da’red 4-3—2008 rejec’red ’rhe request of fhe pefifioner‘. Referring To douse-16 of insTr'ucTions To ’render'er's of fender- documem‘, fhe responden’rs s’ra’red “rho? The quan’ri’ries of The individual i‘rems of ’rhe work may vary or cerfain i’rems may nof be required ’ro be execu‘red a? all so long as The overall value of con’rr‘ac‘r does no’r vary beyond i 25% of The Tender value. . On receipf of The above communicaTion, The peTiTioner requesTed The respondenTs To close The work wiThouT any liabiliTy To any parTy and refund EMD as dispuTe had arisen beTween The parTies ’vide Annexure— P/5 daTed 15-3—2008. However, The respondenTs vide Their memo daTed 19-3—2008 informed The peTiTioner ThaT his denial To execuTe agreemenT vide Annexure-P/6 is breach of condiTion of Tender and The Board conTemplaTes To Take acTion againsT him including forfeiTure of EMD. Finally The respondenTs vide memo daTed 8m May, 2008 (Annexure—P/IZ) communicaTed The peTiTioner ThaT EMD submiTTed by him wiTh The. Tender has been forfeiTed and his requesT daTed 28-5-2008 (Annexure— P/13) for consTiTuTion of commiTTee as per clause 27 To seTTIe The dispuTe was furTher rejecTed by The ChhaTTisgarh EIecTriciTy Board vide Annexure-P/ 14. . Learned counsei for The peTiTioner submiTTed ThaT There was no concluded conTracT beTween The parTies as The work order of Annexure- P/3 was only a counTer offer wiTh cerTain changes in The Schedule of work. The. peTiTioner was To convey his accepTance wiThin 10 days of receipT of The above offer. The peTiTioner communicaTed his objecTion againsT The offer vide Annexure-P/4 wiThin The sTipuIaTed period on 1—3- 2008 and requesTed for modificaTion, however, his requesT was rejecTed. The respondenTs had inviTed The peTiTioner for negoTiaTion To resolve The issue on 5—4-2008 and only ThereafTer EMD was forfeiTed on 8-5— 2008. Thus from The aforesaid correspondences beTween The parTies, iT is clear ThaT There was no any unequivocal accepTance by The peTiTioner \ l\l To The offer of The respondenTs and as such There was no binding conTracT and The respondenTs couid noT have forfeiTed EMD. Reliance is placed in The maTTer of M/s TRickmers VerwalTung 6im H. Versus Indian Oil CorporaTion LTd. {AIR 1999 SUPREME COURT 504}. On The oTher' hand, Shr'i Alok Bakshi, learned counsel for The respondenTs, submiTTed ThaT The peTiTioner submlTTed his offer in responSe To NIT of Annexure~P/1. His offer was finally accepTed afTer 2 rounds of negoTiaTion vide memo, daTed 26-2-2008 (Annexur‘e—P/3). The confracT was governed by The general Terms and condiTions of The conTracf. In clause—16 of fhe insTrucTions To Tenderers of The Tender documenT, iT is specifically menTioned ThaT any alferaTion in The quanTifies of The individual iTems of The work and dropping of cerfain iTems is permissible so long as overall value of The confracf does noT vary beyond .t 25% of The Tender value. In clause-12, iT is menTioned ThaT offer of The Tenderer is valid for a period of 4 monThs from The daTe of accepTance and The Tenderer cannoT wiThdraw his offer in This period and wiThdrawal wiThin ThaT periodenTails forfeiTure of The EMD. Since The peTiTioner did noT execuTe agreemenT afTer deposiTing balance of SecuriTy deposiT as direcTed vide Annexure—P/3 and furTher denied To execuTe agreemenT and prayed for refund of EMD, he commiTTed breach of condiTions of conTracT ’and, Therefore, EMD has been righTly forfeiTed (Annexure—P/IZ). 9. The conTenTion of The peTiTioner ThaT memo daTed 26-2—2008 (Annexure—P/3) was noT in absoluTe accepTance, buT The same was a condiTional counTer offer is based on selecTive reading of The above memo. If The documenf is read in iTs enTireTy, Then iT leaves no room ThaT The peTiTioner's offer was accepTed in Terms of condiTions in The Tender documenT. xx \£ b . 10. We have heard learned counsel for The parties. We have perused *he pleading of The respec’rive par‘ries and lhe documenfs annexed fherewi’rh. 11. The accepmnce of offer of fhe petitioner was communicated by the Chief Engineer vide his memo dated 26-2-2008; along with letter of acceptance latest amendment up to the due date of submission of tender and base rates for Non 50R items, as per Schedule enclosed was also forwarded. By Clause-4 of the memo, the petitioner was directed to execute the contract agreement through its authorized representative. within 10 days of the receipt of memo. In case of his failure to execute agreement within specified time, EMD with the tender was liable for forfeiture. Para -9 of the memo reads as under:- “The maintenance period of work shall be 12 (Twelve) months. Please convey your acceptance of this order. If nothing is heard on the contrary within 10 (Ten) days from the date of issue of this order, it will be presumed that you have accepted the order." 12.In reply to the above memo dated 15’ March, 2008, the petitioner objected to certain alteration made in item rates and BOQ annexed with the work order without his consent. The petitioner requested to make necessary alteration in BOQ forwarded with the work order, according to BOQ, which was given with NIT, however, the aforesaid request was rejected vide Annexure—P/5 on the ground that under clause—16 of instructions to tenderers of tender document, alteration in the quantities of the individual items of the work may vary or certain items may not be required to be executed at all so long as the overall value of ‘ contract does not vary beyond i 25% of tender value. Th tender document has been filed by the respondents as Annexure—R/I. 13. We have carefully examined the tender document of Annexure—R/l anneXed with the return, however, we did not find any condition in the document of Annexure-R/l which allows the respondents to unilaterally e change The quanTiTy of The iTems in The Tender work To The exTenT ThaT value of The conTrocT does noT vary beyond i 25% of The Tender value, as mentioned in The document of Annexur'e-P/5. 14. rom perusal of The memo of Annexure~P/9 wriTTen by respondenT No.2 To The peTiTioner, we furTher noTice ThaT The peTiTioner was called in his office on 5-4-2008 To resolve The issue failing which ocTion deemed fiT was confempla+ed. Thus afTer going Through The enTire correspondences beTween The arTies, parTiculorly memo of The Chief Engineer Annexure—P/3 daTed 26-2-2008, The peTiTioner's reply daTed 4-3—2008 and Annexure—P/9 daTed 28—3—2008, we find ThoT no concluded conTracT had been reached beTween The parTies and They were making efforTs To resolve The dispuTe *hrough negotia‘rions. 16.In The maTTer of M/s Rickmers VerwaITung Gimb H. (Supra), The Hon’ble Supreme CourT in para-12 of The judgmenT held Thus:— “In 'l‘his connecfion 1’he cardinal principle To remember is ’rhaf i’r is ’rhe duty of The Cour? To consfrue correspondence wiTh a view 'ro arrive a‘l‘ a conclusion whefher There was any mee’ring of mind befween The par’ries, which could creafe a binding confracf be‘l‘ween ’rhem bu‘t fhe Court is no’r empowered To creoTe a conTracT for The parTies by going ouTside The clear language used in The correspondence, excepT insofar as There are some approprioTe implicaTions of law To be drawn. Unless from The correspondence iT can unequivocally and clearly emerge ThaT The parTies were ad idem To The Terms, iT cannoT be said ThaT an agreemenT had come inTo exisTence beTween Them Through correspondence. The CourT is required To review whaT The parTies wroTe and how They acTed and from ThaT \ F . p \ maferial 1'0 infer whe‘rher’ The infen‘rion as expressed in The correspondence was To bring info existence a mufually binding contract The infen‘l‘ion of the parties is To be gaihered only from fhe expressions used in the correspondence and The meaning i’r conveys and in case i’r shows Thai There had been meeTing of mind beTween The parTies and They had acTuaIly reached an agreemenT, upon all maTeriaI Terms, Then and Then alone can iT be said ThaT a binding conTracT was capable of being spelT ouT from The correspondence.” 17. In The maTTer of shin 5aTelliTe Public Co.LTd. Vs. Jain 5Tudios LTd. {(2006) 2 SCC 628}, The Hon’ble Supreme CourT, while considering The quesTion of legaiiTy, validiTy and enforceabiIiTy of an arbiTraTion agreemenT, dealT wiTh The severabiliTy of iliegal and void provisions in The agreemenT, referring To Halsbury's Laws of England, para-430 and various judgmenTs of The English CourTs and The judgmenT of The Supreme CourT, held ThaT in The facTs of The ciTed case, The said objecTionable parT is clearly severable as iT is independenT of The dispuTe being referred To and resolved by an arbiTraTor and The CourT does noT need To re-wriTe conTracT or do someThing ThaT is noT conTemplaTed by The parTies and To ThaT exTenT agreemenT is legal and The offending parT can be separaTed and severed by using a “b/ue pencil". 18. In The maTTer of Beed DisTricT CenTral Coop. Bank LTd., Versus STaTe of MaharashTra and oThers {(2006) 8 SCC 514}, “The docTrine of blue pencil" evolved by The English and American CourTs, has been discussed in para—10 To 12 and iT has been observed ThaT This docTrine holds ThaT if CourTs can render an unreasonable resTrainT reasonable by scraTching ouT The offensive porTions of The covenanT, They should do so and Then enforce The remainder. The docTrine is applicable only if The covenanT in \ 3S / \ 9Q question is applicab|e, so That ’rhe unreasonable por’rions may be separa’red. 19. However, 6n The insTan‘r case, we are of The opinion fha’r ‘rhe abov docfr'ine has no applicafion who’rsoever‘, While accepi’ing The offer and issuing work order, respondenT No.2 also enclosed and forwarded base raTes for non SOR ifems as per schedule and direcTed The peTiTioner To communicaTe his accepTance wiThin 10 days. The peTiTioner communicaTed his objecTion againsT The proposed changes wiThin Time and furTher requesTed To adhere To The iTem raTes and lisT of BOQ given in The work order and Then only agreemenT could be execuTed. From correspondences beTween The parTies, iT also appears ThaT The deparTmenT was making efforTs To resolve The dispuTe Through negoTiaTions. 20.Thus afTer considering The enTire correspondence, we are of The opinion ThaT There is no concluded conTracT beTween The parTies. 21. In view of The aforesaid discussion, we allow This peTiTion and quash The impugned order of Annexure—P/lZ and direcT The respondenTs To refund earnesT money of Rs.8.75 lakhs To The peTiTioner TogeTher wiTh simple inTeresT aT The raTe of 6% per onnum from The daTe of» filing of The e peTiTion. KN, Sd/- Sd/— Dhirendra Mishra R.N. CHANDRAKAR. Judge