APHC010701202012 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI WRIT APPEAL NO: 1565 of 2012 Bench Sr.No:-36 [3584] Siva Fish Seed Farm ...Appellant Vs. Government of Andhra Pradesh and others ...Respondent(s) ********** CORAM : THE CHIEF JUSTICE LISA GILL SRI JUSTICE CHALLA GUNARANJAN DATE : 1st October 2026 Present: Advocate for Appellant: MRS.M VIDYAVATHI Advocate for Respondents: GP FOR FISHERIES *** JUDGMENT: (per Hon’ble Sri Justice Challa Gunaranjan) Present intra-Court appeal is directed against the order, dated 23.04.2012, in W.P.No.35 of 2012, whereby learned Single Judge allowed the writ petition in part. Being dissatisfied with rejection of prayer to the extent negated, present appeal is preferred. 2. Appellant/writ petitioner filed writ petition challenging the order passed by 2nd respondent, dated 13.04.2011, as confirmed by 1st respondent, by order, dated 09.10.2011, whereby appellant was mulcted with penalty for violation of the tender and contractual obligations. 2 HCJ & CGR,J W.A.No.1565 of 2012 3. Appellant was awarded contract of supplying fish seed fry for the season 2010–11 in pursuance to the tender issued. As per conditions of tender as well as agreement entered into between 2nd respondent and appellant, it was agreed to supply fish seed fry within the specified time frame. Appellant had furnished EMD of Rs.3 lakhs and performance guarantee equivalent to twice the value of quantity of supply. It is stated that appellant supplied 75% of the ordered quantities and could not complete the remaining. 2nd respondent stated to have issued several reminder notices pointing out default in supply, however, appellant failed to honour the commitment under the contract. In those circumstances, 2nd respondent, invoking the conditions of contract as a measure of penalty in terms of Clause 23, forfeited EMD, performance guarantee equal to twice the value of quantity of short supply of fish seed fry, besides blacklisting the appellant from participating in future tenders for a period of three seasons. The said order was confirmed by 1st respondent, thus, aggrieved, writ petition was preferred. 4. The learned Single Judge, having considered the conditions of contract, held that blacklisting of appellant, and encashment of performance guarantee to the extent of twice the value of short supply was disproportionate and unconscionable in view of the explanation offered by appellant, thus, the impugned orders were quashed to the 3 HCJ & CGR,J W.A.No.1565 of 2012 extent of blacklisting of appellant and restricted the forfeiture of performance guarantee to the value of quantity short supplied. 5. Heard Mrs.M.Vidyavathi, learned counsel for appellant and learned Government Pleader for Fisheries appearing for respondents. 6. Learned counsel appearing for appellant contended that the learned Single Judge was not justified in refusing the prayer for quashing imposition of penalty by way of encashing performance guarantee and EMD, inasmuch as the reasons for non-supply were sufficiently demonstrated and justified, which were not properly appreciated in proper perspective. It is stated that because of heavy rains at relevant point of time, appellant could not supply the remaining 25% of the quantities in time, which is clearly an event of force majeure, thus, the respondents should have taken the same into consideration before imposing any penalty. 7. On the other hand, learned Government Pleader appearing for respondents supported the impugned order passed by learned Single Judge and further contended that when breach of contract is apparent, as a corollary and consequence, the penalty has to follow, and rightly the respondents, after giving due opportunity to the appellant, determined the same, which cannot be found fault with; thus, urged for dismissal of appeal. 4 HCJ & CGR,J W.A.No.1565 of 2012 8. We have given our anxious consideration to the submissions made by learned counsels for the parties and gone through the record. 9. It is not in dispute that in pursuance to tender floated by 2nd respondent, appellant was awarded the contract of supplying fish seed fry for the season 2010–11. The conditions in the tender as well as the contract entered into clearly envisaged the timelines for supply, and any violation thereof, the consequences as well. The very explanation offered by appellant that on account of heavy rains the balance quantity could not be supplied on time establishes that there was default in supply. Learned counsel for appellant also does not deny that appellant had been issued numerous notices calling upon to complete the supply of balance quantities. 10. Clause 22(ii) of the contract specifically states that any delay in supplying fish seed fry with reference to schedule of supply order given to the appellant by Commissioner of Fisheries constitutes violation of terms and conditions of tender/supply order. The consequences for violation of terms and conditions are set out in Clause 23, which reads as under: “23. Penalty for violations:- The following penalties would be levied for the violations mentioned at para (6) & (22). (i) Forfeiture of EMD:- The EMD paid by the supplier will be forfeited completely, and 5 HCJ & CGR,J W.A.No.1565 of 2012 (ii) Encashment of Performance guarantee:- The performance guarantee given by the supplier will be encashed, and (iii) Black Listing:- The tender / his firm will be black listed from taking part to tenders for supply of fish seed to any State Govt. department for a period of three years.” 11. The 2nd respondent issued various notices calling upon the appellant to complete the supply as per the orders placed, despite the same, there was default in compliance. Thus, after giving notice to the appellant and calling for explanation, 2nd respondent passed orders, dated 13.04.2011, imposing the penalty of forfeiture of EMD, performance guarantee equivalent to twice the value of quantity of short supply, besides blacklisting for a period of three seasons. The same was confirmed in appeal. 12. The learned Single Judge, after taking note of totality of circumstances, has granted relief insofar as blacklisting and restricting the value of forfeiture of performance guarantee to the extent of value of quantity short supplied by applying the principle of proportionality. We do not find any infirmity in the reasoning and conclusion arrived at by learned Single Judge. 13. We, therefore, do not find any merit in the appeal, and accordingly, the same is dismissed. No order as to costs. 6 HCJ & CGR,J W.A.No.1565 of 2012 As a sequel, miscellaneous petitions pending, if any, shall stand closed. LISA GILL, CJ CHALLA GUNARANJAN, J cs