1 2025:CGHC:21077-DB NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 2320 of 2025 Bishambhar Dayal Agrawal S/o Late Shri Rajendra Prasad Agrawal Aged About 55 Years Proprietor Of The Petitioner Herein At A/203, Station Road, Om City, Ward No.-21, Champa, Janjgir-Champa, Chhattisgarh 495671 ... Petitioner Versus 1 - State of Chhattisgarh Through - The Public Works Department, Through The Secretary, Mahanadi Bhawan, Mantralaya, Atal Nagar, Naya Raipur - 492 101, Chhattisgarh 2 - Engineer-In- Chief Public Works Department, Nirman Bhawan, North Block, Sector-19, Naya Raipur - 492 101, Chhattisgarh 3 - Chief Engineer Public Works Department, Raipur Zone, Raipur - 492 001, Chhattisgarh 4 - Superintending Engineer Public Works Department, Bridge Circle, Raigarh, Chhattisgarh 5 - Executive Engineer (Setu) Public Works Department, Bridge Division, Raigarh, Chhattisgarh ... Respondents (Cause-title taken from Case Information System) For Petitioner : Mr. Kshitij Sharma, Advocate For Respondents-State : Mr. Shashank Thakur, Deputy Advocate General ANURADHA TIWARI Digitally signed by ANURADHA TIWARI Date: 2025.05.09 11:14:18 +0530 2 Hon'ble Shri Ramesh Sinha, Chief Justice Hon'ble Shri Arvind Kumar Verma , Judge Order on Board Per Ramesh Sinha , Chief Justice 07.05.2025 1. Heard Mr. Kshitij Sharma, learned counsel for the petitioner. Also heard Mr. Shashank Thakur, learned Deputy Advocate General, appearing on behalf of the State/respondents. 2. By way of this writ petition, the petitioner has prayed for following reliefs: “10.1) The Hon'ble Court may further kindly be pleased to issue an appropriate writ, order, or direction quashing and setting aside the impugned final termination notice dated 07.04.2025 (including the earlier notice dated 04.04.2025) (Annexure P27 and P28), issued by Respondent No. 5 under Clause 1.14 of the contract, as being illegal, arbitrary, and without authority of law, the contract having already stood discharged by efflux of time on 30.08.2023. 10.2) The Hon'ble Court may further kindly be pleased to issue a writ of mandamus directing the Respondents to immediately release the FDR amount of Rs. 1,33,17,700/- submitted as Additional Performance Security; 10.3) The Hon'ble Court may further kindly be pleased to issue a writ of mandamus directing 3 the Respondents to immediately release the Security Deposit amount of Rs. 25,70,257/- deducted from Running Account Bills; 10.4) TheHon'ble Court may further kindly be pleased to issue a writ of mandamus directing the Respondents to immediately release the Performance Security amount of Rs. 25,70,257/- deducted from Running Account Bills; 10.5) The Hon'ble Court may further kindly be pleased to issue a writ of mandamus directing the Respondents immediately release the Liquidated Damages amount of Rs. 4,94,042/- deducted illegally; and 10.6) The Hon'ble Court may further kindly be pleased to issue a writ of mandamus directing the Respondents to immediately release the payment of Rebate of Rs. 40,00,000/-; and 10.7) Cost of the petition may also be granted to the Petitioner; and/or 10.8) Any other relief, which this Hon'ble Court deems fit and proper, may also kindly be granted to the Petitioner, in the interest of justice.” 3. The present petition is filed challenging the issuance of revised final termination notice dated 07.04.2025 with respect to contract agreement bearing No.22/DL/21-22 dated 14.01.2022 being the same as arbitrary and illegal as the subject contract agreement has already been discharged on 30.08.2023 by efflux of time. 4 4. Brief facts of the case, in a nutshell, are that, the petitioner is a "A" Class Civil Contractor engaged in the construction activities. Respondent No.3 floated a Notice Inviting Tender (for short, ‘NIT’) bearing NIT No. 545/TC/20-2 dated 15.03.2021 for "Construction of H.L. Bridge I/C Approach Road Across Mand River on Narkalo- Bayasi Road" for a Probable Amount of Contract (for short, ‘PAC’) amounting to Rs.13,22,51,000/- to be completed in 14 months (including rainy season). The Petitioner participated in the said tender by depositing the Earnest Money Deposit (for short, ‘EMD’) of Rs.5,00,000/- and awarded a tender being the lowest bidder and Letter of Acceptance (for short, ‘LOA’) bearing No.1983/T0010/SAC/2021-22/Raigarh dated 25.11.2021 was issued for the said work to be completed within 14 months for total contractual value of Rs.10,57,00,000/- and the petitioner was directed to execute the contract within 15 days by submitting Additional Performance Security amounting to Rs.1,33,17,700/-. Thereafter, in order to comply with the conditions of LOA dated 25.11.2021, the petitioner entered into a contract agreement bearing No.22/DL/21-22 dated 14.01.2022 with the Executive Engineer (Setu), Raigarh Division. Furthermore, the petitioner had also submitted the Additional Performance Guarantee in the form of Fixed Deposit Receipts (for short, ‘FDR’) amounting to Rs.1,33,17,700/-, Security Deposit amounting to Rs.25,70,257/- and Performance Security amounting to Rs.25,70,57/- as per the contractual provisions. The respondents thereafter, issued a work 5 order bearing No.94/T0010/SAC/2021-2022/Raigarh dated 14.01.2022 directing the petitioner to commence the work in accordance with the subject contract and thereby, the petitioner had to complete the subject contract within 14 months i.e. before 13.04.2023. However, the work could not be completed till the actual date of competition of contract i.e. 12.04.2023 for the reasons not attributable to the petitioner and beyond the control of petitioner, namely, non-acquisition of land, amongst others by the respondents. 5. It is case of the petitioner that since the work could not be completed within the stipulated period of contract, the petitioner, vide letter dated 24.03.2023, was constrained to approach respondent No. 5 under clause 1.13.1 of the contract seeking extension of time till 31.12.2023 without penalty specifying various reasons which were not attributable to the petitioner, but the respondents failed to respond to aforementioned extension letter dated 24.03.2023, then the petitioner wrote a reminder letter dated 04.05.2023 to provide a decision on extension letter dated 24.03.2023 stating the hindrances at site being still not encumbrance free. Thereafter, respondent No.4 conducted the hearing on 17.05.2023 on the request of extension of time from 13.04.2023 to 31.03.2023 and the time ought to be extended till 31.12.2023 since the delay is attributable to respondents on account of non- acquisition of land. However, respondent No.4, vide its letter bearing No.875 dated 13.06.2023, had granted the 6 extension of time till 30.08.2023 only under clause 1.31.1 of the contract. Meanwhile, respondent No. 5 had issued a letter bearing No.1004/Auditor/2023-24 dated 08.06.2023 instructing the petitioner to stop the work at site due to onset of monsoon and due to the hindrances in the inception of contract and at the time of seeking extension of time on 24.03.2023 still persists and now, the respondents started playing the game of shifting the burden on petitioner by alleging the delayed progress of execution of contract and thereby withheld 6% amount from Running Account Bill No. 4 and Running Account Bill No. 5. Thereafter, the petitioner wrote a letter dated 28.08.2023 to respondent No. 5 to foreclose the contract in accordance with clause 1.18(a) of the contract, thereby, requesting the respondents to release the EMD amount, Additional Performance Security Amount, Security Deposit, Final Bill Amount along with the deductions illegally made from the Running Account Bills, but respondent No.5 has rejected the request of petitioner vide its letter bearing No.3367/शिल्प/सेतु/2023-24 dated 15.09.2023. Against the said rejection, the petitioner approached respondent No.4 under clause 1.17 of the contract vide letter dated 05.10.2023, which was rejected by respondent No.4 vide letter bearing No.1559/सा/17-25/2020-21 dated 03.11.2023 on the ground that it is not competent to entertain the same as per clause 1.13 of the contract. However, the same was withdrawn vide another letter bearing No.1594/सा/17-25/2020-21 dated 09.11.2023 and the 7 request of the petitioner under clause 1.18(a) was rejected by respondents vide its another letter bearing No.1625/सा/17- 25/2020-21 dated 04.12.2023. 6. Meanwhile, the respondents in order to avoid further course of action, have issued a letter bearing No.3641/शिल्प/सेतु/2023-24 dated 29.11.2023 and thereafter, a show cause notice dated 05.12.2023 for termination of contract under clause 1.14 of the contract was issued to the petitioner by alleging the delayed progress of execution of contract. Thereafter, the petitioner vide its letter dated 06.12.2023, approached respondent No.3 after the rejection of its request by respondent No.4 on 04.12.2023, requesting the foreclosure of contract by releasing the EMD amount, Additional Performance Security Amount, Security Deposit, Final Bill Amount along with the deductions made from the Running Account Bills, but respondent No. 3, instead of acting upon and deciding the petitioner letter dated 06.12.2023 even after receiving the reminder letter dated 17.12.2023, has issued letter bearing No.228/शिल्प/सेतु/2023-24 dated 06.02.2024. Respondent No.5 also issued a show cause notice dated 09.02.2024 under clause 1.14 to cause duress and coercion to the petitioner and the petitioner vide its letter dated 16.02.2024 has requested the respondents to withdraw the show cause notices until the petitioner's request letter dated 06.12.2023 is heard on 19.02.2024 and decided there upon by respondents. However, the said notices were not withdrawn. 8 7. Thereafter, the petitioner approached this Court by filing a writ petition bearing WPC No. 1272 of 2024, which was disposed of vide order dated 04.03.2023 directing the Public Works Department to decide the appeal of the petitioner under clause 1.17 of the tender agreement within a period of four weeks and respondent No.3 dismissed the appeal of the petitioner on 26.09.2024 vide letter bearing No.4286/सा/18- 08/2023 dated 01.10.2024 on the ground that clause 1.18 is not applicable to instant matter as well as there is no provision under which the petitioner can sought foreclosure on contract, as such, it was ordered that the said appeal is not maintainable. 8. Be that as it may, the execution of the subject contract was on hold since performances under the contract were no longer required to be performed after 30.08.2023 due to discharge by efflux of time; and due to the initial procedure of land acquisition could not be completed, including the dispossession of land owners by way of paying them compensation. It is an admitted position that the respondents are solely liable for the delay caused in the execution of contract because since the beginning of contract, they had failed to provide the petitioner the major part of encumbrance free site from the land owners since the land acquisition procedure of dispossessing the land owners by providing compensation could be completed only on 05.02.2025, which is evident from the letter bearing No.35/अ.लि./2024-25/Raigarh dated 05.02.2025 issued by the 9 Sub- Divisional Officer, PWD Department, Setu Development Division -2, Raigarh (C.G.) to respondent No. 5 informing about the completion of land acquisition proceeding on 05.02.2025. Thereafter, letters bearing No.290/शिल्प/सेतु/2024-25 dated 05.02.2025 and 322/शिल्प/सेतु/2024-25 dated 12.02.2025 were issued by respondent No. 5 to the petitioner admitting that now the land acquisition is procedure is completed on 05.02.2025 and thereby directing the petitioner to start the execution of work. Meanwhile, the respondents, after having no response from the petitioner with respect to restarting the execution of work, pespondent No. 5 again issued a show cause notice dated 27.02.2025 under clause 1.14 of the contract. In reply to show cause notice dated 27.02.2025, petitioner wrote a reply dated 05.03.2025 wherein the petitioner categorically stated that after evaluating the considerable delay in execution of contract due to non- availability of site due to ongoing land acquisition procedure till 05.02.2025, which has caused huge financial loss to the petitioner. The petitioner has further stated in the reply that now the contract has already been deemed closed by efflux of time on 30.08.2023 because the contract was not extended further thereafter, it would not execute the remaining work being legally discharged from the contract and hence, the show cause notices for termination issued by respondents are illegal and arbitrarily being the contract already been discharged on 30.08.2023 by efflux of time and as a consequence to the contract being 10 discharged on 30.08.2023 by efflux of time, the petitioner has requested in its reply dated 05.03.2025 to initiate the procedure for closure of the contract. Furthermore, the petitioner also requested the respondents to pay its: a) FDR amount of Rs.1,33,17,700/- submitted as Additional Performance Security; b) Security Deposit amount of Rs.25,70,257/- deducted from Running Account Bills; c) Performance Security amount of Rs.25,70,257/- deducted from Running Account Bills; d) Liquidated Damages amount of Rs.4,94,042/- deducted illegally and e) Rebate of Rs.40,00,000/- deducted illegally. 9. Thereafter, the respondents have issued a final termination notice dated 04.04.2025 to the petitioner as also issued a revised final termination notice dated 07.04.2025 under clause 1.14 of the contract. 10. Learned counsel for the petitioner submits that the respondents have erred in refusing the foreclosure of the contract as well as issuing repeated show cause and termination notices despite their own acknowledged delays. He further submits that the failure of the respondents to provide an encumbrance-free site since the inception of the contract is a fundamental breach of contractual obligations which directly hindered the petitioner's ability to perform its part of the contract as the respondents have failed to acquire and hand over the project site till 05.02.2025, despite the initial contractual period having lapsed on 12.04.2023. It has been 11 contended that the petitioner was induced to sign the subject contract on false premise by mentioning that the 90% of the site is available being already free from the land acquisition proceeding, which was incorrect by virtue of letter dated 05.02.2025 and 12.02.2025 wherein the respondents have admitted that the land acquisition proceeding had completed on 05.02.2025. It has been further contended that the respondents have illegally withheld substantial amounts due to the petitioner, including Earnest Money Deposit, Additional Performance Security, Performance Security, Security Deposit, deductions from Running Account Bills, and illegal deductions of Liquidated Damages and Rebate, despite the fact that the contract stands discharged by efflux of time as of 30.08.2023 and such withholding is not only arbitrary but also amounts to unjust enrichment. It has been submitted that the refusal to foreclose the contract under Clause 1.18(a) is arbitrary and contrary to the contract itself as the petitioner's invocation of Clause 1.18(a) was supported with material and valid reasons, and yet the rejection of the same was prejudicial and without application of mind as well as repeated issuance of show cause notices under Clause 1.14, despite the admitted fact that land acquisition was completed only on 05.02.2025, demonstrates an attempt to shift the blame onto the Petitioner and to coerce compliance in an already time-lapsed contract, in violation of the principles of natural justice. It has been further submitted that final termination notice dated 07.04.2025 is void 12 and unenforceable in law, since the contract had already come to an end on 30.08.2023 by efflux of time and as such, issuance of such notice post-facto is illegal, without jurisdiction, and aimed only at denying the legitimate dues of the petitioner. It has been lastly submitted that the conduct of the respondents amounts to coercion, harassment, and economic duress, particularly in light of their refusal to refund amounts lawfully due, thereby crippling the Petitioner's business and causing irreparable harm to the petitioner, as such, the writ petition be allowed. 11. On the other hand, learned counsel appearing for the State/respondents opposes the submissions advanced by learned counsel for the petitioner and submits that although the award has been passed in land acquisition proceedings on 05.02.2025 and there was no hindrance created by any of the land owner as well as the petitioner has carried out certain construction like 4 pillars and slabs on the private lands, which goes to show that the land was very much available to the petitioner. It has been contended that the petitioner has stopped the work for more than 20 months before and inspite of repeated calls, he did not start the work, thereafter show cause notices were given to him, which was replied by the petitioner and after considering his reply, a termination notice was given to the petitioner on 04.04.2025, which was withdrawn and thereafter, a final revised termination notice was given to him on 07.04.2025, which is neither arbitrary nor contrary to the facts of the case. Therefore, no interference is 13 warranted by this Court and the instant writ petition deserves to be dismissed. 12. We have heard and considered the submissions of the learned counsel appearing for the parties and have perused the materials on record with utmost circumspection. 13. From perusal of the final termination letter dated 07.04.2023, it would show that the petitioner delayed the work though repeated instructions were given to him to complete the within time period as per agreement, but the same has not been done as he has committed fundamental breach of under 1.14 of the agreement, which are explained as below:- (a) He has stopped work for more four weeks, (Since 20 months) when no stoppage of work was shown on the current work Programme or the stoppage has not been authorized by the Executive Engineer; (c) He has delayed the completion of work by the number of weeks [20 Months]; and (g) Any Other deficiency which goes to the root of the contract performance: No Progress within week only 47% of work has been done whereas time stipulated for work is lapsed on 14.05.2023 and the extended 14 time without penalty also lapsed on 30.08.2023.” 14. The petitioner has replied to the said office memo dated 27.02.2025 (vide reference No.7) vide letter dated 05.03.2025 (vide reference No.8), the point wise reply has been given by the petitioner, which is as under :- “Point No.01:- Yes it is Correct that about 20% of hand was private land whose acquisition was under process and the payment to land owner is completed by date 05.02.2025, But it is also clear that construction has been done by you in that area also, which clearly shows that land was available to work but you are trying to take cover of land acquisition over your failure with that you have not worked in rest 80% area which was free from any kind of hindrance. Point No.02:- Yes agreed but even after providing extra time no efforts being done by you for the completion of work. Point No.03:-The work would have been finalized and dues can be paid, it completed within scheduled period, but passing on the time idly didn't provide you the right for the Payment of due & other retention many. Point No.04:- Yes agreed as instructed by the hon high 15 court the agreement termination was kept on hoid but as of now the decision is given by the Chief engineer and even after that you have not taken any step to start the work. Point No.5:- It has been rejected being non maintainable. Point No.06:- Passing of time idly didn't make any right to get benefit of it. Point No.07:- Yes the land acquisition payment completed on date 05.02.2025 but the private land was effecting only about 20% area and you have worked on that without any hindrance but you have not completed the work in the hindrance free area. Point No.08:- The work will be finalized under agreement clauses. Point No.09:- The work will be finalized under agreement clauses. Point No.10:- All kinds of refunds can be done only as per the agreement clause. Point No.11:- Same as point no-10. 15. In view of the above, the Executive Engineer P.W.D. Bridge Construction Division Raigarh terminated the contract awarded to the petitioner under clause 1.14 (With Penal Clause) of the 16 contract agreement and taken action in accordance with clause 1.14 of the contract agreement, according to which Earnest Money submitted and Security Deposit forfeited as also the compensation @ 10% (Ten percent) of the balance value of work left incomplete be recovered/deducted/adjusted either from the bill and or from available performance guarantee or be recovered as" arrears of land revenue". 16. Considering the overall facts and circumstances of the case as well as arguments advanced on behalf of the respective parties, we are of the considered opinion that failure on the part of the petitioner to attend and/or refusing to acknowledge the measurements so recorded in the Departmental measurement books shall be at his sole risk and responsibility and measurements recorded by the department shall be deemed to be acceptable to him. 17. It is well settled law that the existence of an alternate remedy, is, undoubtedly, a matter to be borne in mind in declining relief in a writ petition in a contractual matter. Again, the question as to whether the writ petitioner must be told off at the gates, would depend upon the nature of the claim and relief sought by the petitioner, the questions, which would have to be decided, and, most importantly, whether there are disputed questions of fact, the resolution of which is necessary as an indispensable prelude to the grant of the relief sought. Undoubtedly, while there is no 17 prohibition, in the writ Court even deciding disputed questions of fact, particularly when the dispute surrounds demystifying of documents only, the Court may relegate the party to the remedy by way of a civil suit. 18. On consideration of the materials on record, we find that the respondent authorities has not committed any illegality in passing the impugned order dated 07.04.2025 and the decision of the respondent authorities cannot be said to be unjustified or unwarranted as being aware of the fact that the termination may lead to forfeiture of the Earnest Money submitted and Security Deposit forfeited as also the compensation @ 10% (Ten percent) of the balance value of work left incomplete be recovered/deducted/adjusted either from the bill and or from available Performance Guarantee or be recovered as “arrears of land revenue”. 19. Concludingly, in our considered opinion, the petitioner has miserably failed to make out a case for interference in exercise of extraordinary jurisdiction under Article 226 of the Constitution of India within the four corners of law and yardsticks set out by Their Lordships of the Supreme Court in the above-quoted judgments. We accordingly, hold that there is no reason to exercise the power of judicial review in this instant matter, as the petitioner has not been able to demonstrate arbitrariness, unfairness, irrationality or unreasonableness in the impugned order dated 07.04.2025. 18 20. As a fallout and upshot of the above-stated legal discussion, the writ petition is devoid of merit and is hereby dismissed leaving the parties to bear their own cost(s). Sd/- Sd/- (Arvind Kumar Verma) (Ramesh Sinha) Judge Chief Justice Anu