Case: Union Of India  Vs. Tantia Construction Pvt.Ltd

consultant for designing the plan for execution. During the above process, it was found that each earth filled approach road could not be raised above 7 meters and, as a result, the remaining 8 meters was to be made of complete cement casting known as a Viaduct. The Railways got the matter examined by its own associate, RITES, and, thereafter, approved the plan. The consequence of the said change was that the Tender which was of 19 crores stood increased to 36 crores on account of the additional work which was to be undertaken as a result of the modified design. In fact, the Railways themselves decided to float a fresh Tender for the additional work at an estimated cost of 24.50 crores separately. As a result, the work relating to construction of the Rail Over-Bridge now consisted of two parts, one of which the Respondent Company was executing and the other to be executed by a different contractor. However, as mentioned hereinbefore, there was hardly any response to the Tender floated. Seeing that the quantum of work under Tender No.76 of 06-07 stood reduced, the Respondent Company wrote to the Petitioners on 12th April, 2008, agreeing to undertake the varied work at the same rate and on the same terms and conditions, subject to the Price Variation Clause. The problem appears to have begun at this stage when, on the basis of the said letter dated 12th April, 2008, the Petitioners directed the Respondent Company to continue with the unfinished portion of the plan. 23. Admittedly, the work which had to be completed within 15 months from the date of issuance of the letter of acceptance, could not be completed within the said period and, on the other hand, a new element was introduced into the design of the Rail Over-Bridge. It is the case of the Respondent Company that any item of work directed to be performed could not be covered by the original contract dated 12th/13th February, 2007, and realizing the same, the Railways themselves floated a fresh Tender No.189 of 2008 for the additional work of the extended portion of the Viaduct.24. We are of the view that the letter dated 12th April, 2008, did not cover the extended work on account of the alteration of the design and was confined to the work originally contracted for. We cannot lose sight of the fact that while the initial cost of the Tender was accepted for 19,11,01,221.84p., the costs for the extended work only was assessed at 24.50 crores and that two offers were received, which were for 34,11,16,279.39p. and 35,89,93,215.66p. respectively. This was only with regard to the extended portion of the work on account of change in design. The Respondent Company was expected to complete the entire work which comprised both the work covered under the initial Tender and the extended work covered by the second Tender. The Respondent had all along expressed its unwillingness to take up the extended work and for whatever reason, it agreed to complete the balance work of the initial contract at the same rates as quoted earlier, despite the fact that a long time had elapsed between the awarding of the contract and the actual execution thereof.25. In our view, the Respondent Company has satisfactorily explained their position regarding their offer being confined only to the balance work of the original Tender and not to the extended work. The delay occasioned in starting the work was not on account of any fault or lapses on the part of the Respondent Company, but on account of the fact that the project design of the work to be undertaken could not be completed and ultimately involved change in the design itself. The Respondent Company appears to have agreed to complete the varied work of Tender No.76 of 06-07 which variation had been occasioned on account of the change in the design as against the entire work covering both the first and second Tenders. To proceed on the basis that the Respondent Company was willing to undertake the entire work at the old rates was an error of judgment and the termination of the contract in relation to Tender No.76 of 06- 07 on the basis of said supposition was unjustified and was rightly set aside by the learned Single Judge of the High Court, which order was affirmed by the Division Bench. 26. The submissions made on behalf of the Petitioners that in terms of Clause 23(2) of the Agreement, the Petitioners were entitled to alter and increase/decrease the scope of the work is not attracted to the facts of this case where the entire design of the Rail Over-Bridge was altered, converting the same into a completely new project. It was not merely a case of increase or decrease in the scope of the work of the original work schedule covered under Tender No.76 of 06-07, but a case of substantial alteration of the plan itself. 27. Apart from the above, even on the question of maintainability of the writ petition on account of the Arbitration Clause included in the agreement between the parties, it is now well-established that an alternative remedy is not an absolute bar to the invocation of the writ jurisdiction of the High Court or the Supreme Court and that without exhausting such alternative remedy, a writ petition would not be maintainable. The various decisions cited by Mr. Chakraborty would clearly indicate that the constitutional powers vested in the High Court or the Supreme Court cannot be fettered by any alternative remedy available to the authorities. Injustice, whenever and wherever it takes place, has to be struck down as an anathema to the rule of law and the provisions of the Constitution. We endorse the view of the High Court that notwithstanding the provisions relating to the Arbitration Clause contained in the agreement, the High Court was fully within its competence to entertain and dispose of the Writ Petition filed on behalf of the Respondent Company.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]23. Admittedly, the work which had to be completed within 15 months from the date of issuance of the letter of acceptance, could not be completed within the said period and, on the other hand, a new element was introduced into the design of the Rail Over-Bridge. It is the case of the Respondent Company that any item of work directed to be performed could not be covered by the original contract dated 12th/13th February, 2007, and realizing theves floated a fresh Tender No.189 of 2008 for the additional work of the extended portion of the Viaduct.24. We are of the view that the letter dated 12th April, 2008, did not cover the extended work on account of the alteration of the design and was. We cannot lose sight of the fact that while the initial cost of the Tender was., the costs for the extended work only was assessed at 24.50 crores and that two offers were received, which were for 34,11,16,279.39p. and 35,89,93,215.66p. respectively. This was only withto the extendedportion of the work on account of change in design. The Respondent Company was expected to complete the entire work which comprised both the work covered under the initial Tender and the extended work covered by the second Tender. The Respondent had all along expressed its unwillingness to take up the extended work and for whatever reason, it agreed to complete the balance work of the initial contract at the same rates as quoted earlier, despite the fact that a long time had elapsed between the awarding of the contract and the actual execution thereof.25. In our view, the Respondent Company has satisfactorily explained their position regarding their offer being confined only to the balance work of the original Tender and notto the extendedwork. The delay occasioned in starting the work was not on account of any fault or lapses on the part of the Respondent Company, but on account of the fact that the project design of the work to be undertaken could not be completed and ultimately involved change in the design itself. The Respondent Company appears to have agreed to complete the varied work of Tender No.76 of 06-07 which variation had been occasioned on account of the change in the design as against the entire work covering both the first and second Tenders. To proceed on the basis that the Respondent Company was willing to undertake the entire work at the old rates was an error of judgment and the termination of the contract in relation to Tender No.76 of 06- 07 on the basis of said supposition was unjustified and was rightly set aside by the learned Single Judge of the High Court, which order was affirmed by the Division Bench.Apart from the above, even on the question of maintainability of the writ petition on account of the Arbitration Clause included in the agreement between the parties, it is now well-established that an alternative remedy is not an absolute bar to the invocation of the writ jurisdiction of the High Court or the Supreme Court and that without exhausting such alternative remedy, a writ petition would not be maintainable. The various decisions cited by Mr. Chakraborty would clearly indicate that the constitutional powers vested in the High Court or the Supreme Court cannot be fettered by any alternative remedy available to the authorities. Injustice, whenever and wherever it takes place, has to be struck down as an anathema to the rule of law and the provisions of the Constitution. We endorse the view of the High Court that notwithstanding the provisions relating to the Arbitration Clause contained in the agreement, the High Court was fully within its competence to entertain and dispose of the Writ Petition filed on behalf of the Respondent Company.