Dismissed¶¶23

M/S. Panchdeep Construction Ltd. v. Calcutta Metro Rail Corporation Ltd. and Anr.

Calcutta HC7 Apr 2025APO/437/2017

Case brief

AI extract

What is this about?

Panchdeep Construction Ltd. v. Calcutta Metro Rail Corporation Ltd. (KMRCL); APO/437/2017 with WPO/1130/2016; High Court at Calcutta; termination of contract dated 26.11.2016; performance guarantee not furnished within stipulated time; Clause 6.13; letter of acceptance 06.06.2016; 60-day extension; arbitration clause; maintainability of writ petition only in exceptional circumstances; appeal against Single Judge order dated 16.08.2017; contract awarded to third party; appeal dismissed, no order as to costs.

What did the court decide?

None to the appellant; appeal dismissed with no order as to costs. ¶¶23

M/S. Panchdeep Construction Ltd. Vs Calcutta Metro Rail Corporation Ltd. and Anr. — Calcutta HC (2025) — LawSathi Research

What the court decided

AI extract

Outcome

None to the appellant; appeal dismissed with no order as to costs.

¶¶23

Issue for consideration

Whether the Division Bench should interfere with the learned Single Judge's order dated 16th August, 2017 (on the writ petition challenging the termination of the contract dated 26th November, 2016), in view of the appellant's failure to furnish the performance guarantee within the period stipulated under the contract. +1 more

¶¶22

Court's answer

The Division Bench found no reason to interfere with the order passed by the learned Single Judge, and dismissed the appeal with no order as to costs.

¶¶22

Ratio / Principle

It was admitted and not in dispute that the performance guarantee was sought to be furnished beyond the period stipulated under the said clause (Clause 6.13), and this aspect had been considered by the learned Single Judge.

¶¶21

Key takeaways

The letter of acceptance was issued on 6th June, 2016; the performance guarantee ought to have been furnished on or before 6th July, 2016, with a further permitted period of 60 days (to 6th August, 2016); yet even on 23rd August, 2016 the performance bank guarantee was not furnished.ratio¶¶15
Reliance on the letter dated 16th August, 2016 to show that a format of the performance guarantee was forwarded was considered immaterial.ratio¶¶15
Where the contract contains an arbitration clause, a writ petition is maintainable only in exceptional circumstances; the appellant, knowing it had to seek remedy in arbitration, had filed the writ application.

Detailed headnote1 paragraphs

High Court at Calcutta, Division Bench (Soumen Sen and Smita Das De, JJ.), 7th April, 2025 (APO/437/2017 with WPO/1130/2016): Appeal against the learned Single Judge's order dated 16th August, 2017, by which the writ petition of M/s. Panchdeep Construction Ltd. challenging the termination of its contract by Calcutta Metro Rail Corporation Ltd. (termination letter dated 26th November, 2016) was dealt with, was dismissed. The letter of acceptance was issued on 6th June, 2016 and the performance guarantee was to be furnished on or before 6th July, 2016, extendable by a further 60 days (to 6th August, 2016); the performance bank guarantee was not furnished even on 23rd August, 2016. It was not in dispute that the performance guarantee was sought to be furnished beyond the period stipulated under Clause 6.13 of the contract, an aspect considered by the learned Single Judge, who had found at the threshold that the guarantee was not in accordance with that clause. Reliance on a letter dated 16th August, 2016 forwarding a format of the performance guarantee was held immaterial. The Court observed that the contract contains an arbitration clause and that only in exceptional circumstances is a writ petition maintainable. Appeal dismissed; no order as to costs.

¶1

O-2

¶2

ORDER SHEET

¶3

IN THE HIGH COURT AT CALCUTTA Civil Appellate Jurisdiction ORIGINAL SIDE

¶4

APO/437/2017 WITH WPO/1130/2016

¶5

M/S. PANCHDEEP CONSTRUCTION LTD. VERSUS

¶6

CALCUTTA METRO RAIL CORPORATION LTD. AND ANR.

¶7

BEFORE: The Hon’ble JUSTICE SOUMEN SEN AND The Hon’ble JUSTICE SMITA DAS DE Date : 7^th April, 2025.

¶8

Appearance: Mr. Haradhan Banerjee, Sr. Adv. Ms. Somali Mukhopadhyay, Adv. ..for the appellant

¶9

Mr. Sakya Sen, Sr. Adv. Mr. Atri Mandal, Adv. Mr. Ankit Dey, Adv. ...for KMRCL

¶10

This appeal is arising out of an order passed by the learned Single Judge on 16^th August, 2017 in which the letter of termination dated 26^th November, 2016 was under challenge.

¶11

On the earlier occasion, we adjourned this matter in order to ascertain whether the appeal has now become infructuous in view of awarding of the contract in favour of the third party.

¶12

Mr. Haradhan Banerjee, learned senior counsel appearing on behalf of the writ petitioner/appellant submits that in the event the termination is held to be illegal or wrongful, the appellant is entitled to claim damages before the appropriate forum as the writ

¶13

¶14

court may not be the appropriate forum to decide the quantum of damages. Reference is made to the arbitration clause in the contract. Mr. Banerjee further submits that before the acceptance of the bank guarantee, they have executed works for which they have received some payment.

¶15

In the affidavit filed on behalf of the Metro Railway authorities and as pointed out by Mr. Sen that the performance guarantee was not submitted even after expiry of 60 working days i.e. 23^rd August, 2016. It is not in dispute that the letter of acceptance was issued on 6^th June, 2016 and on or before 6^th July, 2016 the performance guarantee ought to have been furnished. However, the contract permits a further period of 60 days which means 6^th August, 2016. It appears that even on 23^rd August, 2016 the performance bank guarantee was not furnished. Reliance on the letter dated 16^th August, 2016 to show that a format of the performance guarantee was forwarded is considered to be immaterial.

¶16

Mr. Sakya Sen, learned senior counsel appearing on behalf of the respondent no.1 has submitted that the dispute arose on 26^th November, 2016 when the contract was terminated. The appellant knowing fully well that the appellant had to seek remedy in arbitration has filed the writ application and the time spent in this proceeding cannot now be interpreted in favour of the appellant.

¶17

The contract contains an arbitration clause. Only in exceptional circumstances a writ petition is maintainable. The learned Single

¶18

¶19

Judge has at the threshold found that the performance guarantee

¶20

is not in accordance with Clause 6.13 of the contract.

¶21

Admittedly, it is not in dispute that the performance guarantee was sought to be furnished beyond the period stipulated under the said clause. This aspect was considered by the learned Single Judge.

¶22

In view of the above, we do not find any reason to interfere with the order passed by the learned Single Judge.

¶23

The appeal stands dismissed. However, there shall be no order as to costs.

¶24

(SOUMEN SEN, J.)

¶25

(SMITA DAS DE, J.)

¶26

bp/R.Bhar

M/S. Panchdeep Construction Ltd. v. Calcutta Metro Rail Corporation Ltd. and Anr.

Case brief

What is this about?

What did the court decide?

M/S. Panchdeep Construction Ltd. v. Calcutta Metro Rail Corporation Ltd. and Anr.

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Procedural history

Parties & counsel

Coram

Case details

Similar cases

Saldiha College Repd by Mr Manik Lal Das Vs State of West Bengal and Ors.

Sumati Kabiraj Vs Purnima Ghosh

The Oriental Ins Co. Ltd. Vs Bapi Das and Ors.

Selina Afroza Begum on Death of Sole Petitioner Malekustur@Malek Rahaman Vs State of West Bengal and Ors.

Sanghita Maity Alias Sanghita Maiti Vs State of West Bengal and Ors.

Samiun Islam Gazi Vs State of West Bengal and Ors.