Allowed

A.Thajudheen v. State of Kerala

Kerala HC6 Feb 2014WP(C)/986/2014

Case brief

AI extract

What is this about?

Petitioner, a road construction contractor, filed this writ petition seeking refund of Earnest Money Deposits furnished after executing formal agreements and providing performance bank guarantees. The Court held the deposits must be released.

What did the court decide?

Direction to the State of Kerala to release the Earnest Money Deposits to the petitioner expeditiously, with an outer limit of two weeks from the date of producing a certified copy of the judgment.

A.Thajudheen Vs State of Kerala — Contract and Commercial Disputes | Kerala HC (2014)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE MR.JUSTICE P.N.RAVINDRAN

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THURSDAY, THE 6TH DAY OF FEBRUARY 2014/17TH MAGHA, 1935`

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WP(C).No. 986 of 2014 (W)

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PETITIONER :

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----------

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A.THAJUDHEEN THOPPIL VEEDU, THOLIKUZHY ADAYAMON P.O., KILIMANOOR, THIRUVANANTHAPURAM, 695 614

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BY ADV. SRI.AJITH KRISHNAN

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RESPONDENTS :

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1. STATE OF KERALA REPRESENTED BY PRINCIPAL SECRETARY, PUBLIC WORKS DEPARTMENT, GOVERNMENT SECRETARIAT THIRUVANANTHAPURAM, 695001.

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2. THE PRINCIPAL SECRETARY TO GOVERNMENT INFORMATION TECHNOLOGY DEPARTMENT GOVERNMENT SECRETARIAT THIRUVANANTHAPURAM, 695001.

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3. THE CHIEF ENGINEER, OFFICE OF THE CHIEF ENGINEER, ADMINISTRATION, IT CELL PUBLIC OFFICE THIRUVANANTHAPURAM, 695 033.

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4. THE SUPERINTENDING ENGINEER, PWD ROADS AND BRIDGES, SOUTH CIRCLE, THIRUVANANTHAPURAM- 695 033.

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5. PRINCIPAL SECRETARY, FINANCE DEPARTMENT GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM- 695 001.

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BY SENIOR GOVERNMENT PLEADER SRI.P.M.A KALAM (P.W.D)

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06-02-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WP(C).No. 986 of 2014 (W)

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APPENDIX

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PETITIONER(S)' EXHIBITS

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EXT.P1: TRUE COPY OF THE SELECTION NOTICE NO.DB4/1053/13 DATED 29-6-2013 ISSUED BY THE 4TH RESPONDENT.

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EXT.P2: TRUE COPY OF THE SELECTION NOTICE NO.DB 14-2353/2013 DATED 9-9-2013 ISSUED BY THE 4TH RESPONDENT.

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EXT.P3: TRUE COPY OF THE REPRESENTATION DATED 1-11-2013 SUBMITTED TO THE 4TH RESPONDENT.

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EXT.P4: TRUE COPY OF THE LETTER NO.DB 4/1053/2013/2013 DATED 2-12-2013 ISSUED BY THE 4TH RESPONDENT TO THE 3RD RESPONDENT.

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EXT.P5: TRUE COPY OF THE LETTER NO.DB 14-2353/2013 DATED 4-11-2013 ISSUED BY THE 4TH RESPONDENT TO THE 3RD RESPONDENT.

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RESPONDENT(S)' EXHIBITS : NIL.

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//TRUE COPY//

P.A. TO JUDGE

P.N.RAVINDRAN, J.

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----------------------------W.P.(C) No. 986 of 2014

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Dated this the 6^th day of February, 2014

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J U D G M E N T

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The works of improvements to Paripally Madathara Road and Kallara-Adappupara Road in Thiruvananthapuram District were awarded to the petitioner as per Exhibit P1 letter dated 29.06.2013 and Exhibit P2 letter dated 09.09.2013 respectively. By those letters he was called upon to execute necessary agreements within 14 days from the date of receipt of the said letters. The petitioner accordingly executed agreements in respect of the first work on 22.07.2013 and in respect of the second work on 03.10.2013. This writ petition is filed contending that though formal agreements were executed on 22.07.2013 and on 03.10.2013 and performance bank guarantees were also furnished, the Earnest Money Deposits of Rs.4,87,200/- and Rs.3,74,700/- have not so far been refunded. In this writ petition the petitioner prays for an order directing the respondents to release the Earnest Money Deposits forthwith.

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A statement dated 05.02.2014 has been filed on behalf of the fourth respondent. In paragraph 2 thereof, it is stated that as per PWD Manual 2012, the Earnest Money Deposit has been released to

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W.P.(C) No.986/2014 2

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the bidder after the contractor furnishes performance security deposit and when duly enters into a contract. It is also stated that the petitioner has furnished security deposits for both the works and entered into a contract. The fourth respondent however stated that after on-line payment mechanism was implemented the tenders invited through tender procurement system, receipt and releasing of Earnest Money Deposit are processed on-line. It is stated that refund of Earnest Money Deposit is carried out by the State Bank of Travancore on getting confirmation from National Informatics Centre and that the Earnest Money Deposits are refunded by remitting it online to the District Treasury after the contract is awarded. The fourth respondent has also stated that on an enquiry made in the Kerala IT Mission which monitors refunds by State Bank of Travancore, he has been informed that the Kerala IT Mission has received Treasury settlement details from the Treasury Department on 10.12.2013 and that the refund mechanism has finalised and all Earnest Money Deposits will be refunded shortly.

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Paragraph 2009.8 of PWD Manual, 2012 stipulates that the Bid Security (EMD) will be released to the selected bidder after he furnishes Performance Security Deposit or Bank Guarantee and duly enters into the contract. Paragraph 2009.7 inter alia stipulates that

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W.P.(C) No.986/2014 3

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the selected bidder shall produce a security deposit equal to 10% of the contact amount in the form of Bank Guarantee from any nationalized or scheduled bank which shall remain valid till 28 days from the completion of the defect liability period. Paragraph 2010 stipulates that agreement for the work shall be got executed by the Contractor with Department in the form prescribed in the bidding document after the award of contract within the period specified in the selection notice duly entered in the register of agreement as per Appendix 2000E.

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In the instant case, it is not in dispute that the formal agreement was executed in respect of the first of the works on 22.7.2013 and in respect of the second work on 3.10.2013. It is also not in dispute that the petitioner has produced bank guarantee for the amount of the performance security deposit. I such circumstances, I am of the opinion that the respondents should release the bid security (EMD) to the petitioner. Though the PWD manual does not stipulate any time limit for such release, I am of the opinion that the State which insists on the bidder complying with the terms of the PWD Manual, 2012 cannot withhold the EMD even after the contractor has complied with the stipulations in paragraph 2009.8. The respondents should in my opinion forthwith release to the petitioner the bid security (EMD)

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W.P.(C) No.986/2014

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referred to in Exts.P4 and P5 letters sent by the fourth respondent.

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I accordingly dispose of the writ petition with a direction to the

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State of Kerala to ensure that the EMD referred to in Exts.P4 and P5 letters is released to the petitioner expeditiously and in any event within an outer limit of two weeks from the date on which the petitioner produces a certified copy of this judgment along with a copy of the writ petition compete in all aspects before the third respondent Chief Engineer.

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P.N.RAVINDRAN, (JUDGE)

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vps

A.Thajudheen v. State of Kerala

Case brief

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A.Thajudheen v. State of Kerala

Case brief

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