The Court quashed an order rejecting a contractor's claim for a 35% rate enhancement. Since prior administrative proposals recommending the enhancement had Principal Secretary and Minister approval, the rejection was unsustainable unless the Finance Department specifically disagreed. A remand was directed within six weeks.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT :
THE HONOURABLE MR. JUSTICE ANTONY DOMINIC
MONDAY, THE 28TH NOVEMBER 2011 / 7TH AGRAHAYANA 1933
WP(C).No. 5599 of 2010(Y)
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PETITIONER(S):
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K.K.SUNIL KUMAR, GOVERNMENT CONTRACTOR, 'UDHYANAM', CHANGANKULANGARA, OACHIRA P.O.,KOLLAM.
BY SRI. N.N. SUGUNAPALAN (SR.)
ADV. SRI.R.GOPAN
SMT.T.V.HEMALATHA
RESPONDENT(S):
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1. STATE OF KERALA, REPRESENTED BY THE PRINCIPAL SECRETARY PUBLIC WORKS DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM.
2. THE PRINCIPAL SECRETARY,FINANCE DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM.
3. P.S.SREEKUMAR, ADDITIONAL SECRETARY TO GOVERNMENT, PUBLIC WORKS DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM.
4. THE CHIEF ENGINEER, PUBLIC WORKS DEPARTMENT, PUBLIC OFFICE BUILDING, THIRUVANANTHAPURAM.
5. THE SUPERINTENDING ENGINEER, OFFICE OF THE SUPERINTENDING ENGINEER,BUILDING SOUTH CIRCLE, PUBLIC WORKS DEPARTMENT, THIRUVANANTHAPURAM.
6. THE EXECUTIVE ENGINEER,OFFICE OF EXECUTIVE ENGINEER, PWD BUILDINGS DIVISION, KOLLAM.
BY GOVERNMENT PLEADER SRI. SANJEETHA
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 28/11/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
AS
WPC.NO. 5599/2010
APPENDIX
PETITIONERS EXHIBITS:
2/-
-2-
WPC.NO. 5599/2010
RESPONDENT'S EXHIBITS:
R1(A) COPY OF THE G.O.(RT)NO.127/08/PWD DATED 30/01/2008.
/TRUE COPY/
P.A.TO.JUDGE
AS
ANTONY DOMINIC, J.
W.P.(C) No. 5599 of 2010 Y
Dated this the 28th day of November, 2011
~ ~ ~ ~ ~ ~ ~ ~ ~ ~
On 15.09.2007, respondents issued a notification
inviting tenders for the construction of Government Press and Training Centre at Umayanalloor in Kollam district. Petitioner, a contractor, submitted his tender and his bid quoting 19% above the estimated rate was accepted and accordingly, Ext.P2 agreement dated 15.02.2008 was entered into between the parties. Though belatedly, he was issued Ext.P3 work order on 03.05.2008 and the site was handed over by Ext.P13 dated 01.09.2008. Thereupon, the petitioner commenced the work on that basis and in the meanwhile, in April, 2008, the schedule of rates were revised and petitioner submitted Exts.P8 to P10 representations requesting for the benefit of rate revision. He was not given any reply and, therefore, he filed W.P.(C) No.21180/2008 before this Court. That writ petition was
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disposed of by Ext.P11 judgment directing consideration of the representations. However, his claim was rejected by Ext.P23 order.
Court in W.P.(C) No.36900/2008. This writ petition was disposed of by Ext.P24 judgment once again directing reconsideration of the matter. Immediately thereafter, petitioner filed Ext.P25 representation. Accordingly, petitioner was heard and his claim was again rejected by Ext.P27 order. It is challenging Ext.P27 and also requiring the respondents to give him the benefits of revision, the writ petition is filed.
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that the contract in question was a fixed rate contract and that Exts.P26 and P28 were only recommendations which are not binding on the Government. It was also contended that the other cases where rate enhancement was given, which were pointed out by the petitioner, were also factually different from the case of the petitioner and, therefore, were incomparable.
sides.
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operative portion of the judgment reads thus:-
“Accordingly, I set aside Ext.P23 and direct the 1st respondent to reconsider the claim of the petitioner urged by him in Ext.P8 representation in the light of Ext.P12 affidavit and Exts.P19, P22 & P25 referred to above. This shall be done with notice to the petitioner as expeditiously as possible, at any rate, within three months of production of a copy of this judgment.”
7. After the judgment was rendered, petitioner filed
Ext.P25 representation. Accordingly, he was heard on 11.11.2009 and Ext.P26 is the minutes of such hearing and the recommendation in the matter. In Ext.P26, the Additional Secretary to Government, Sri.P.S.Sreekumar, who is the signatory to Ext.P27 also, made the following recommendations:-
“11. On perusal of the documents it is
seen that the tender was on 15.9.07, selection notice issued on 13.7.08 and agreement executed on 15.2.08 and the work
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order was issued on 3.5.08 but as agreed by the Executive Engineer, PWD (R&B), Kollam the site was fully handed over for building works only on 1.9.08. Since there was default on the part of the Department to hand over hazzle free work site extension of time up to 30.8.10 was given to the petitioner without fine. The petitioner’s claim is that he is not responsible for the default in handing over site for work. Further he argued that it was the liability of PWD to hand over work site hazzle free. It was also found that there were 9 trees standing at the building site. The formalities of auction of trees was completed and all the 9 trees were cut and removed fully only on 18.8.08. As such the Department could had over the site to the petitioner only on 1.9.08. Meanwhile the new SOR came into effect on 1.4.08 and there was also price escalation for materials in the market. If the above work is retendered there is no scope for any better one since the present contract is based on
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2007 SOR. The request of the contractor in the hearing was to give an enhanced rate of 65% above SOR 2007.
12. Considering all the above facts, a rate enhancement at the rate of 35% above estimate rate of 2007 SOR may be granted to the petitioner and thereby comply the High Court dated 29.9.2009.
13. If agreed, the Finance Department may be requested to agree to the proposal in view of the judgment of the High Court to reconsider the earlier decision of the Government in view of the enhancement granted by the State Government as per Exts.P14, P15, P16, P17, P18, P19 etc.
14. File may be circulated to Minister(Works) for orders.”
is seen from this document that the aforesaid proposal was
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agreed to by the then Principal Secretary to Government, Public Works Department, who has affixed signature on 02.12.2009. This proposal was also agreed to by the then Minister for Works who has affixed his signature on 08.12.2009. It is in spite of all these, that the Additional Secretary to Government who originated the proposal evidenced by Ext.P26 himself has issued Ext.P27 order dated 22.01.2010, rejecting the petitioner’s claim in the following terms:-
“5. In view of the facts that the rate enhancement is in violation of agreement conditions, no enhancement of agreed rate can be allowed. If the enhancement is sanctioned for one work, may similar cases are likely to crop up. Hence Government hereby order to reject the request of the contractor. If the contractor is not willing to take up the work at the accepted rate the Chief Engineer Buildings and Local Works will make arrangements to terminate the contract and rearrange the work.”
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sustained and in such circumstances, I quash Ext.P27.
Writ petition is disposed of as above.
Sd/- (ANTONY DOMINIC, JUDGE)
aks/30/11
// True Copy //
P.A. To Judge
2 issues framed by the court
Whether the order rejecting the petitioner's claim for rate revision was sustainable given the prior recommendation by the Additional Secretary.
Whether the petitioner should be granted the benefit of the proposal contained in Ext.P26 if the Finance Department has not disagreed to it.
K.K.SUNIL KUMAR
STATE OF KERALA
ANTONY DOMINIC
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
