Allowed

M/S. G.B.Chowdhury Holdings Pvt. Ltd. v. Food Corporation of India and 2 Ors.

Gauhati HC13 Sept 2022WP(C)/214/2019

Case brief

AI extract

What is this about?

The Gauhati High Court allowed a writ petition filed by a transporter seeking payment for additional kilometers driven during a contract execution. The court held that the contractor must be paid at the original quoted rate for the actual distance verified by an FCI review committee, relying on a binding precedent.

What did the court decide?

Directed respondents to release balance payment for 52.5 KM at Rs. 10.98 per MT per KM within 60 days and release the security deposit.

M/S. G.B.Chowdhury Holdings Pvt. Ltd. Vs Food… — Company and Corporate | Gauhati HC (2022)

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GAHC010005782019

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THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

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Case No. : WP(C)/214/2019

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M/S. G.B.CHOWDHURY HOLDINGS PVT. LTD.

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HAVING THEIR REGD. OFFICE AT CHOWDHURY TILLA SARUMOTORIA, OPPOSITE DISPUR CAPITAL COMPLEX, GUWAHATI-781006, ASSAM REP. BY ITS DIRECTOR.

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VERSUS

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FOOD CORPORATION OF INDIA AND 2 ORS.

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A STATUTORY BODY, ESTABLISHED UNDER THE FOOD CORPORATION ACT 1964, HAVING ITS HEADQUARTERS IN NEW DELHI AND A REGIONAL OFFICE AT GUWAHATI G.S. ROAD, PALTANBAZAR, ABOVE FBB, MT TOWER (3RD FLOOR TO 5TH FLOOR), GUWAHATI, KAMRUP (M), ASSAM781008, REP. BY ITS CHAIRMAN AND MANAGING DIRECTOR.

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2:THE EXECUTIVE DIRECTOR (NE)

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FOOD CORPORATION OF INDIA ZONAL OFFICE (NE) G.S. ROAD G. L. PUBLICATION BUILDING ULUBARI GUWAHATI-07.

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3:THE GENERAL MANAGER (REGION) FOOD CORPORATION OF INDIA REGIONAL OFFICE GUWAHATI G.S. ROAD PALTANBAZAR ABOVE FBB MT TOWER (3RD FLOOR TO 5TH FLOOR)

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GUWAHATI KAMRUP (M) ASSAM-781008

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For the Petitioner : Mr. N. Deka, Adv.

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For the Respondent: Mr. B.K. Singh, SC, FCI.

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THE HON’BLE MR. JUSTICE SUMAN SHYAM

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Date of hearing : 13/09/2022.

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Date of judgement : 13/09/2022.

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JUDGEMENT AND ORDER (ORAL)

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1. Heard Mr. N. Deka, learned counsel appearing for the writ petitioner. I have also heard Mr. B.K. Singh, learned Standing Counsel, FCI, appearing on behalf of the all the respondents.

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2. This writ petitioner herein, is a company registered under the Companies Act, 1956, having its registered office at Chowdhury Tilla, Sarumotoria, Dispur, Guwahati, in the district of Kamrup (M). Aggrieved by rejection of its prayer for release of additional amount for the actual distance covered under the contract agreement, the instant writ petition has been filed seeking a Writ of Mandamus from this Court.

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3. The facts and circumstances of the case giving rise to the filing of the writ petition are stated hereunder.

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4. The respondent no. 3 had issued a “Notice Inviting e-Tender” (NIeT) dated 30/03/2015 inviting bids from interested contractors for execution of transportation contract under the Food Corporation of India (FCI) in respect of as many as 13 different routes. It was a 2(two) bid system wherein, the contractors were required to submit their technical bid as well as the price bid. The tender document itself had provided that the rate quoted should be per MT per KM as per MTF. If the rate is quoted otherwise, it shall be converted into per MT per KM taking the distance as mentioned in the NIeT.

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5. In response to the NIeT dated 30/03/2015, the writ petitioner herein had submitted

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its bid in respect of the work at Sl. No. 5 of the NIeT pertaining to “Ex-Railway Siding, Salchapra to FCI, FSD, Nandannagar (Tripura) via Weigh Bridge” having distance 232 KMs. Since we are concerned in this case only with the work at Sl. No. 5 of the NIeT, the particulars of other works included in the NIeT, are not relevant and therefore, are not referred to in this judgement.

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6. As per the projection made in the NIeT, the total distance to be covered in the route for which the writ petitioner had submitted its bid was 232 KMs. As such, the petitioner had quoted an amount of Rs. 2549/- per MT taking the distance to be 232 KMs. Since the quote of the petitioner was per MT, hence, in accordance with the tender condition noted above, the rate quoted by the petitioner was converted into per MT per KM taking the distance as mentioned in the NIeT, which worked out to Rs. 10.98 per MT per KM. Accordingly, the petitioner became the L-1 bidder and the work was awarded to it. On completion of the work, payment was also made to the petitioner for a distance of 232 KMs @ Rs. 10.98 per MT per KM.

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7. It transpires from the materials available on record that during execution of the contract, the authorities had noticed certain discrepancies with regard to the distance originally projected in the NIeT dated 30/03/2015 in respect of as many as four different routes. As such, a 4 (four) member Review Committee was constituted by the FCI to verify the actual distance and prepare a report as regards the road distance pertaining to ExRailway Siding, Salchapra to FCI, FSD, Arundhuti Nagar, Nandan Nagar and Chandrapur as well as Ex-Railway Siding, Bihara to FSD, Chandrapur and Nandan Nagar.

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8. Upon making the physical verification of the distance, the Review Committee had submitted its report dated 12/09/2016 under the signature of four responsible officials of the FCI. As per the projection made in the report dated 12/09/2016 pertaining to the work executed by the petitioner i.e. in the route “Salchapra to FCI FSD, Nandan Nagar (Tripura) via Weigh Bridge”, the actual distance was found to be 284.8 KMs. In other words, the original distance of 232 KMs projected in the NIeT dated 30/03/2015 was found to be incorrect as the actual distance in the said route was found to be 284.8 KMs. The FCI authorities have also accepted the findings of the Review Committee to be correct.

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9. After the report of the Committee dated 12/09/2016 became available, the writ petitioner had approached the respondents seeking payment for the additional distance of 52

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KMs i.e. the distance over and above 232 KMs, as projected in the NIeT. However, such claim of the petitioner was rejected by the respondents. Even the appeal submitted by the petitioner before the Grievance Redressal Committee (GRC) in the year 2018 has not been considered by the respondents. Under the circumstances, the writ petitioner has been compelled to approach this Court by filing the instant writ petition seeking a Writ of Mandamus.

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10. The respondents have filed counter-affidavit denying and disputing the claim of the petitioner inter-alia, contending that since the petitioner had quoted a rate based on the distance reflected in the NIeT i.e. 232 KM, it would not be open for the petitioner to claim any additional amount at this stage.

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11. Mr. Deka, leaned counsel for the writ petitioner submits that the only issue arising in this writ petition for a decision of this Court is as to whether the petitioner would be entitled to payment in respect of the actual distance determined by the authorities as per its quoted rate or the stand of the respondents in denying the payment to the petitioner as regards the additional amount and the consequent non-release of the security deposit, was valid in the eye of law. According to Mr. Deka, the same issue came up for consideration before this Court in another writ petition being WP(C) 4111/2017 (N.E. Trade & Transport and another Vs. Food Corporation of India and others), which was disposed of by the learned Single Judge by judgement and order dated 03/04/2018 by upholding the claim of the contractor. The judgement of the learned Single Judge was also affirmed by the Division Bench. According to Mr. Deka, the FCI had already made payment to the contractor in compliance with the direction passed by this Court in the aforementioned proceeding. Since the petitioner is a similarly situated contractor, having a similar claim in respect of the work no. 5 under the same NIeT dated 30/03/2015, Mr. Deka submits that there is no justifiable ground for the respondents to take a different stand in the present case.

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12. Mr. B.K. Singh, learned counsel appearing for the respondents, on the other hand, has argued that the petitioner, having quoted an amount of Rs. 2549/- per MT by taking 232 KMs as the actual distance, its claim for additional payment would not be maintainable under the contract agreement, inasmuch as, such a process would involve re-calculation of the amount for the additional distance. Since such re-calculation of the amount would call for reassessment of the terms of the contract, hence, submits Mr. Singh, the same would not be

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permissible in the eye of law. According to Mr. Singh, the claim of the petitioner should be remanded to the GRC for taking a decision in accordance with the tender conditions. In support of his above argument, Mr. Singh has relied upon a judgement of the Division Bench rendered in the case of Food Corporation of India and 4 others Vs. M/s. Anup Trade and Transport Pvt. Ltd. and another passed on 24/02/2020 in connection with WA 36/2020 to contend that similar claim of another contractor, which was entertained by the learned Single Judge by order dated 22/05/2019 passed in WP(C) No. 3138/2018, was declined by the Division Bench by holding that granting relief to the writ petitioner would amount to re-assessment of the rate, which would not be permissible in a writ proceeding.

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13. I have considered the submissions advanced by learned counsel for the rival parties and have also carefully gone through the materials available on record.

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14. It is not in dispute that as per projection made in the NIeT dated 30/03/2015, the distance for the work in question was projected as 232 KMs. It is also the admitted position of fact that taking note of the aforesaid distance, the petitioner had quoted Rs. 2549/- per MT as the price. The aforesaid amount was converted into per MT per KM which worked out to Rs. 10.98 per MT. Accordingly, the petitioner had emerged as the L-1 bidder in respect of the aforesaid work and was awarded the contract. The petitioner’s counsel has also confirmed that his client has received payment with regard to 232 KMs @ Rs. 10.98 per MT per KM. The only grievance of the petitioner is that the prayer for payment made in respect of the additional distance has been declined by the respondents.

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15. As noted herein above, during execution of the contracts, the respondents had realized that there were certain discrepancies in respect of the actual distance with regard to as many as four different routes forming part of the 13 works coming under the NIeT dated 30/03/2015. Mr. Singh, learned counsel for the respondents submits that such discrepancy had occurred since the distance originally projected in the NIeT was on the basis of calculation made with regard to the Meter Gauge (MG) Railway Siding but in the meantime, the Broad Gauge(BG) siding started functioning, which had altered the distance. Be that as it may, the justification for constituting a Review Committee is not under challenge in this writ petition and neither party has disputed the findings recorded by the Review Committee. From the submission made by Mr. Singh, it is self evident that the distance originally projected in the NIeT in respect of the work in question stood altered subsequently due to change of

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railway track from MG to BG. It was perhaps for such reason that the FCI had appointed the four member Review Committee so as to ascertain the actual distance in those routes. Therefore, if the respondents have themselves acknowledged the fact that subsequent to issuance of the NIeT, the actual distance with regard to as many as four routes including the one involved in the present case had changed and considering the fact that the contractors were entitled to receive transportation charges as per the actual distance notified by the FCI on the basis of the rates quoted by them, this Court is of the opinion that the claim of the writ petitioner deserves due consideration.

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16. It appears from the materials available on record that another contractor M/s. N.E. Trade and Transport had submitted its bid in respect of work at serial No. 3 of NIeT dated 30/03/2015 viz. “Ex-Railway Siding, Salchapra to FCI, FSD, Arundhuti Nagar (Tripura) via Weigh Bridge”, the distance of which was originally shown in the NIeT to be 242 KMs. M/s. N.E. Trade and Transport was the L-1 bidder in that case. After execution of the contract and taking note of the finding of the Review Committee to the effect that the actual distance for the said route was 295.1 KM, the respondents had decided to pay the contractor M/s. N.E. Trade and Transport for the original distance i.e. 242 Kms but as per the rate quoted by the L- 2 bidder, which was Rs. 2799/- per Mt instead of paying it for the additional distance as per the rate quoted by it. Aggrieved thereby, M/s. N.E. Trade and Transport had approached this Court by filing WP(C) No. 4111/2017, which was allowed by the learned Single Judge by order dated 03/04/2018. The operative part of the judgement dated 03/04/2018 is reproduced herein below for ready reference :-

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“14. The L-2 tenderer had quoted Rs. 2,799.00 for a distance of 243 KMs and, based on the same, the rate of Rs. 11.52 per MT per KM was arrived at by the respondent authorities. The petitioner had quoted Rs. 11.41 per MT per KM and thus he had emerged as the L-1 tenderer. However, the respondents have now taken the said rate of Rs. 2,799.00 to be the rate offered by the L-2 tenderer for the distance of 295.1 KMs, which is not the case. The NIT itself made it very clear that the rate per MT shall be as per MTF and if the rate is quoted otherwise, rate per MT per KM will be worked out taking the distance as notified in the NIT, which is 243 KMs. In this factual background, the exercise undertaken by the respondents to find out as to what would have been the rate of L-2 bidder for per MT per KM, by dividing Rs. 2,799.00 by 295.1

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KM, is arbitrary, irrational and defies all logic. When the petitioners had quoted a rate for per MT per KM, the rate of the petitioners should have been applied for the entire distance instead of trying to figure out as to what would have been the rate of L-2 bidder for the distance of 295.1 KMs. Who knows what rate he would have quoted for 295.1 KMs. That apart, the NIT does not provide taking of such a recourse. It also appears that the respondents had reduced the rate of Rs. 11.41 per MT per KM quoted by the petitioners to Rs. 9.48 per MT per KM for the entire distance of 295.1 KMs. In the considered opinion of the court, the calculations made has no basis and logic whatsoever.

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In view of the above discussions, the respondents are directed to make payment to the petitioners at their quoted rate of Rs. 11.41 per MT per KM for the entire distance of 295.1 KMs. If any amount has already been paid to the petitioners, the same shall be adjusted while making final payment to the petitioners. Payment shall be made to the petitioners within a period of three months from the date of receipt of a certified copy of this order by the General Manager, FCI, Assam Region.”

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17. The writ appeal preferred by the FCI against the judgement and order dated 03/04/2018 as dismissed by the Division Bench of this Court by judgement dated 07/05/2019. There is no wrangle at the bar that the FCI authorities had also released payment in favour of the N.E. Trade and Transport as per the judgement dated 03/04/2018 passed in WP(C) No. 4111/2017 as upheld by the Division Bench.

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18. A careful reading of the judgement dated 03/04/2018 goes to show that the main controversy involved in the said proceeding was with regard to the criteria that was to be adopted for making payment to the contractor with regard to the altered/additional distance. The aforesaid aspect of the matter has not only been settled by the learned Single Judge by judgement and order dated 03/04/2018 but it was also decided that the contractor would be entitled to make a claim for the actual distance as per the original rate quoted by it. The aforesaid judgement has attained finality and has also been implemented by the FCI. Since the writ petitioner is a similarly situated contractor making a similar claim as that of M/s. N.E. Trade and Transport, this Court does not find any justifiable ground for the FCI to take a

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different stand in the matter.

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19. Mr. Singh, learned counsel for the respondents, in his usual fairness submits that the FCI is not disputing that the actual distance coming under the contract was 284.5 KMs but the dispute in this case is pertaining to the rate that would be applicable. According to Mr. Singh, longer the distance, lower would be the rate of contract and therefore, the petitioner cannot be paid as per its original quoted rate. The aforesaid argument of Mr. Singh may have some merit but the same cannot be accepted at this stage for the simple reason that the aforesaid aspect of the mater has been considered and decided by the judgement dated 03/04/2018 passed by the learned Single Judge which is binding on this Court. Hence, the issue as regards applicability of the rate for payment of the contractual bill for the additional distance stood settled and the said issue cannot be re-opened in the present proceeding.

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20. Coming to the judgement dated 24/02/2020 passed by the Division Bench in Writ Appeal No. 36/2020, it is to be noted herein that the order dated 22/05/2019 passed by the learned Single Judge in WP(C) No. 3132/2018 allowing similar claim of another contractor M/s. Arup Trade and Transport Pvt. Ltd. was set aside by the Division Bench and the matter was remanded to the GRC of the FCI for a decision to be taken in the matter on good faith. The Hon’ble Division Bench was of the view that the claim of the contractor would require reassessment of the rates and in the peculiar facts and circumstances of the case, which could not be permissible in exercise of writ jurisdiction. However, the respondents (FCI) have already rejected the claim of the writ petitioner. As such, the judgement dated 24/02/2020 passed in WA No. 36/2020, in the considered opinion of this Court, was rendered in the facts and circumstances of that case. This Court is of the opinion that the dispute involved in this writ petition is squarely covered by the judgement and order dated 03/04/2018 which was upheld by the Division Bench of this Court by order dated 07/05/2019. As such, adopting a different view in the matter in the facts and circumstances of the case would not be permissible in the eye of law.

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21. For the reasons stated herein above, the writ petition succeeds and is hereby allowed. The writ petition is disposed of with a direction upon the respondent nos. 1, 2 and 3 to release the balance payment to the petitioner in respect of the additional 52.5 KM @ Rs. 10.98 per MT per KM within a period of 60 (sixty) days from the date of receipt of a certified copy of this order. The respondents will also ensure that the security deposit of the petitioner

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is released along with the payments, as directed by this Court.

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22. With the above observations, the writ petition stands disposed of.

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There would be no order as to costs.

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JUDGE

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Sukhamay