Thriveni Sainik Consortium v. National Thermal Power Corporation LXD

1. Allowed,subjecttojust exceptions. W.P.rCI 5144/2018 & CM APP No.19943/2018

2. Mr. Sibal, who appears for the petitioner, says that the respondent sought extension ofthe validity period ofthe project proposal submitted by the petitioner, on three occasions. It is submitted that, resultantly, the subject bank guarantee offered as EMD had to be extended,likewise,by the petitioner,on three occasions. 2.[1] Learned counsel submits that recurring extension ofthe subject bank guarantee has resulted in mulcting the petitioner with financial burden and therefore, a prayer was made to the respondent to permit the substitution of the subject bank guarantee with another bank guarantee, issued by a bank W.P.(G)5144/2018. Page 1 of[4] 2018:DHC:9027 approved by the respondent.

3. Mr.Puneet Taneja, who appears on advance notice, does not dispute the fact that the subject bank guarantee, at the say so ofthe respondent,has been extended by the petitioner on three occasions. 3.[1] It is, however,the submission of learned counsel for the respondent that the bidder is duty bound to extend the subject bank guarantee. For this purpose,Mr.Taneja relies upon clause 12.7(b)oftheITB. Learned counsel says that there is no leeway in the said clause for replacing the subject bank guarantee by another bank guarantee. Accordingto Mr.Taneja,replacement ofthe subject bank guarantee with another bank guarantee would amount to modification ofthe project proposal and,hence,it cannotbe permitted.

4. In order to appreciate this submission, I may only extract hereafter clause 12.7(b)oftheITB. "12.7ProjectProposal Validity (a)XXX XXX XXX (b)In exceptional circumstances, NTPC may solicit the Bidder's consent to an extension ofthe Project Proposal Validity Period. The request and responses thereto shall he made in writing or telefax or email followed by post confirmation. If a Bidder accepts to prolong the Project Proposal Validity Period, the EMD shall also be suitably extendedfailing which, the Project Proposal extension shall be invalid. A Bidder may refuse the requestfor extension in ProjectProposal Validity Period without forfeiting its EMD.A Bidder accepting the request,for extension ofvalidity will be neither required nor permitted to modify its Proposal."

5. A bare perusal ofclause 12.7(b),as extracted above,would show that W.P.(C)5144/2018 Page^of[4] the respondent could have obtained the consent of the petitioner i.e., the bidder, for extension of the project proposal validity period only in exceptional circumstances. However,once a request is made,it is clear that the petitioner if it wishes to remain in fray, would have no choice but to extend the validity period of the project proposal. The argument, thus, advanced on behalf of the respondent that the petitioner could refuse its consent to the extension of project proposal validity period and, thereby, avoid extension of subject bank guarantee is untenable and far removed from practicality in the given circumstances. The present situation is a creation ofthe respondent's own doing.

6. It is notin dispute thatthe petitioner could have given the HMD in the form ofa demand draft(s)or a banker's cheque(s)or an iirevocabie ietter(s) ofcredit, or bank guarantee(s), as set out in clause 12.[4] ofthe ITB. Clause 12.[4] and 12.[7] of the ITB have to be read hannoniously. Therefore, substitution ofthe subject bank guarantee with another only allows for,in a sense,extension ofEMD,albeit,in another,form.:

7. In view ofthe above,primafacie,I am-ofthe opinion thatthere is no bar in the petitioner replacing the subject bank guarantee with a fresh bank guarantee of an equivalent value, issued by a bank approved by the respondent, as that by itself does not lead to modification of the project proposal.

8. However, it has been brought to my notice by Mr. Sibal that the subject bank guarantee already stands extended till 30^'' June, 2018. The record, though, shows that via a communication dated 3'''' May,2018, the respondent has already indicated to the petitioner that validity ofthe subject bank guarantee submitted should be extended till 30'^ August, 2018 as a W.P.(C)5144/2018 Page3of[4] request has been made to extend the period ofvalidity ofproject proposal up to and including 16"^ July,2018.

9. It is pertinent to note that the validity of the project proposal, presently, expires on 16"^ May,2018. Given these circumstances, for the moment,I am inclined to stay the operation ofthe impugned communication dated 20"^ March,2018.The petitioner willfurnish afresh bank guarantee of an equivalent value,issued by an approved bank,in case,it wishes to extend the validity period ofits proposal beyond 16*''May,2018.

10. To be noted, at this stage, Mr. Puneet Taneja, on instructions, says that he does not wish to file a counter affidavit in the matter and that the writ petition be disposed of in terms of aforesaid directions. Accordingly, the interim order is made absolute.

11. The writpetition is allowed in terms ofprayer clause(i)and(ii).

12. Dasti. —, \ ( IL RAJIV SHAKDHER,J MAY 14,2018 mk