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TMI Blog2010 (9) TMI 225X X X X Extracts X X X X X X X X Extracts X X X X ..... s for construction of married accommodation at Shankar Vihar-II, Pocket, Delhi Cantonment, at an estimated cost of Rs. 40 crores ('the Notice'). Clause 6 of the Notice stipulated that the tenderer shall furnish earnest money of Rs. 40 lakhs in the form of FDR from a nationalized bank drawn in favour of the Director General, Married Accommodation Project, Kashmir House, Rajaji Marg, New Delhi. Clause 6 also stipulated that if the firm revokes its offer during the validity period, the earnest money furnished by the firm shall be forfeited. In response to the Notice, the petitioner submitted its offer along with earnest money of Rs. 40 lakhs. When the tenders were opened on 5-5-2004, the offer of the petitioner was found to be the lowest at Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he petitioner had to make the correction in the figure so as to read as Rs. 32,76,000 instead of Rs. 23,76,000 because a mistake had been committed by the petitioner while calculating the figure and, therefore, soon after the tender was opened on 5-5-2004 the petitioner submitted the letter dated 6-5-2004 to the respondent No. 2 correcting the aforesaid mistake in the calculation of the figure. He submitted that the respondent No. 2 ought not to have treated the letter dated 6-5-2004 as revocation of the offer of the petitioner. Learned counsel for the petitioner further submitted that in any case the entire Notice was recalled and a fresh Notice was issued by respondent No. 2 inviting tenders at a revised estimated cost. According to learn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -5-2004. These facts clearly establish that the petitioner was not willing to stand by its original offer of Rs. 32 crores for the work and was willing to do the work only at the revised bid of Rs. 41 crores. The High Court was thus right in coming to the conclusion that the petitioner had revoked its offer of Rs. 32 crores for the work. 7. The legal principles relating to 'Earnest Money' are well settled. In Chiranjit Singh v. Har Swarup AIR 1926 PC 1, the Judicial Committee of the Privy Council held : "Earnest money is part of the purchase price when the transaction goes forward: it is forfeited when the transaction falls through, by reasons of the fault or failure of the vendee". These observations of the Judicial Committee have been ..... X X X X Extracts X X X X X X X X Extracts X X X X
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