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Sanjay Patil : Nagpur Press Media : 15 June 2020 : Nagpur bench of Bombay High Court has directed authorities not to take coercive action against a national highway contractor for delay in completion of work due to ongoing lockdown and not to encash bank guarantee worth Rs 65 crore. A division bench consisting of Justice Ravi Deshpande and Justice Amit Borkar, while hearing a petition filed by Patil Construction and Infrastructure Ltd, Pune, against abrupt termination of contract pertaining to upgradation of national highway amounting to Rs 300 crores, restrained the respondents from taking any coercive steps. The petitioner firm was tasked with upgradation of NH-161 and 3531 in Akola-Akot section in Akola district and Seldoh junction in Wardha district.
Taking exception to abrupt termination of contract, the construction firm averred that the delay in execution of the work was owing to the apathy of the department, in failing to immediately provide right of way and transfer possession free from encumbrances to the petitioner within stipulated time, so also assisting in requisite permissions from the District Collector, Forest Department etc. Central Government, in the wake of lockdown due to COVID-19, had given extension of three to six months to all the projects. Yet, authorities refused to abide by the same, which forced the contractor to approach the High Court.
Petition challenging the decision of the Central Government was presented through online facility made available by the Nagpur Bench, and the same was scheduled to come up on June 12. Despite receipt of the intimation pertaining to upcoming hearing, another order directing forfeiture of safety deposit was passed on June 9, requiring the petitioner to seek preponement and urgent hearing. Considering the urgency involved, a special sitting was arranged wherein protection against forfeiture of bank guarantee amounting to Rs 65 crore was granted.
The petitioner pointed out that the termination was vindictive and without following due procedure. At the same time, reliance was placed on Circular dated March 9 identifying the projects as stuck projects, and making them eligible to benefit of foreclosure without coercive orders of forfeiture of bank guarantee.
The High Court, after hearing the counsels appearing for the parties, observed that no loss would be caused to the Government if the contractor were to continue work, since new tenderer would be granted more time for completing the same work. The High Court restrained the respondent from encashing or forfeiting the bank guarantee. Next hearing is slated on June 24.
Senior Adv Satish B Talekar, Adv Pradnya Talekar, Adv Madhavi Ayyappan with Adv Nihalsing Rathod appeared for the petitioner.
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