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TMI Blog2016 (5) TMI 1622X X X X Extracts X X X X X X X X Extracts X X X X ..... nafter referred to as the 'Corporation') vide Annexure-1, debarring it for a period of three years from participating in future tenders and not to encash the bank guarantee, and further seeks for a direction to release the amount of pending bills in respect of transformers already supplied and received by the Corporation. 2. The factual matrix of the case in hand is that in response to the tender notice floated by the opposite party-Odisha Power Transmission Corporation Ltd. on 08.02.2014 inviting e-Tender for supply of transformers, the petitioner had participated and was found to be the second lowest tenderer. However, the petitioner was awarded 30% of the tender work on the rate quoted by the lowest tenderer. On 18.06.2014 purch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... poration. Then on 01.06.2015, the opposite party-Corporation wrote to the State Bank of India, which had issued bank guarantee in favour of the Corporation on behalf of the petitioner, requesting that the process of the Bank Guarantee may be remitted in favour of the Corporation. On coming to know of the said communication by the Corporation to the Bank, the petitioner vide his communication dated 04.06.2015, requested the opposite party-Corporation not to encash the Bank Guarantee, and offered to pay the amount towards Bank Guarantee by way of demand draft. The opposite party-Corporation agreed to such offer and did not encash the Bank Guarantee and accepted the demand draft for the amount of Bank Guarantee on 26.09.2015. On 14.09.2015, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommunication dated 4.6.2015, the petitioner had itself offered to pay the amount in lieu of the bank guarantee furnished by it, because encashment of the bank guarantee would adversely affect the reputation of the petitioner. It is thus submitted that the letter of encashment of bank guarantee has been sent after the admission of the petitioner with regard to the same. It is further submitted that time is the essence of the contract, and since the petitioner did not supply the transformers within time i.e. by 17.03.2015, encashment of the bank guarantee, as well as debarring the petitioner from participating in any tender for a period of three years, is fully justified and that the order dated 20.04.2015 was not in the form of extension of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere is no doubt that time is the essence of the contract, but when provision for extension is provided under clause-16 of the contract itself, and amended purchase order in terms of the said contract has been issued, the terms of which have been complied with by the petitioner, the original contract/agreement/purchase order would automatically stand amended to the extent of the subsequent order. 7. In Basheshar Nath v. Commissioner of Income Tax, Delhi and Rajasthan, AIR 1959 SC 149, Mademsetty Satyanarayana v. G. Yelloji Rao, AIR 1965 SC 1405, Associated Hotels of India Ltd. v. S.B. Sardar Ranjit Singh, AIR 1968 SC 933 and Sikkim Subba Associates v. State of Sikkim, AIR 2001 SC 2062, the Apex Court held that even in case of mandatory prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w, and without complying with the principles of natural justice, amounts to blacklisting him, which is also not permissible under law. 10. In M/s. Erusian Equipment & Chemicals Ltd. (supra), the Apex Court held that fundamentals of fair play require that the person concerned should be given an opportunity to represent his case before he is put on the black list. 11. In Gorkha Security Services (supra), the Apex Court held that merely because clause in Notice Inviting Tender empowers department to impose such penalty that does not mean that such penalty can be imposed without putting defaulting contractor to notice to this effect. 12. The reference made to Kulja Industries Limited (supra) by the learned Sr. Counsel for the opposite party ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner also cannot raise any dispute with regard to the encashment of the bank guarantee, as its communication dated 04.06.2015 itself is an offer to pay the bank guarantee amount in lieu of the bank guarantee which was returned to the petitioner on furnishing bank draft, and the same was only acted upon by the petitioner after passing the impugned order on 14.09.2015, on 26.09.2015 when the petitioner submitted the bank draft of equivalent amount for taking back the bank guarantee. In such view of the matter, we would not be inclined to interfere with the direction in the impugned order dated 14.09.2015, with regard to the encashment of the bank guarantee. 15. At this stage learned counsel for the petitioner has submitted, that the pending ..... X X X X Extracts X X X X X X X X Extracts X X X X
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