Engineering Projects (India) Ltd. v. Indian Institute of Foreign Trade

1. The petitioner has filed the present petition, inter alia, impugning a cortimunication dated 30.08.2017, whereby the respondnet had withdrawn the earlier communication dated 15.06.2017. The said communication dated 15.06.2017 was issued with regard to award ofwork relating to constaiction of New Campuses at Maidan Garhi, New Delhi and Kakinada (Andhra Pradesh).

2. The petitioner states that respondent had taken over possession of a plot ofland measuring 5or 6at acres Maidan Garhi, New Delhi fi'om DDA for expansion of its campus for academic purposes. Thereafter, the respondent had issued aletter dated 17.02.2017 to the petitioner expressing its desire to engage Public Work Organisations (PWO) and Public Sector Undertakings (PSU) for execution ofthe works relating to the construction of the campus building. The respondent also issued an advertisement on W.P. (C) 8034/2017 Pflgg I of[5], 2017:DHC:8846 their website inviting Expression of Interest (EOI) from PWOs/PSUs for execution of, construction work/ construction of building/Campus Development and Repair/Maintenance.

3. The petitioner submitted its EOI for empanelment on 06.03.2017 and, was invited to make apower point presentation.

4. After the petitioner had made its presentation, the petitioner was issued aletter dated 16.05.2017, calling upon the petitioner to quote the rates for the works as specified therein. The petitioner responded to the aforesaid e-mail and provided the quotations for its Consultancy/Professional fees. Thereafter, on 15.06.2017, the respondent issued the following letter:- "No. E&M 10(19)/2017 Dated: 15.06.2017 Shri Shamim Ahmad, Additional General Manager, Engineering Projects (India) Ltd. Core-3, Scope Complex, 7- Lodhi Road, New Delhi- 110003 Shamim.ahmad@engineeringprojects.com Sub: Engagement ofAgency for Construction ofNew Campuses at Maidan Garhi New Delhi and Kakinada (Andhra Pradesh) (Award of Work) Sir, Please refer to your Financial Bid dated 22.05.2017 for the subject cited above. This is to inform you that the Institute is pleased to select Engineering Projects (India) Ltd. as agency for Construction of New Campuses at Maidan Garhi, New Delhi and Kakinada (Andhra Pradesh) as per terms and condition as indicated in the said EOI. fV.P. fC) 8034/2017 Pa^e2of[5] You are requested to depute your technical team to ascertain the work urgently. Kindly acknowledge the receipt of this work order and send back the duplicate copy ofthe order duly signed and stamped as a tokenof acceptance of this order. Thanking you, Yours faithfully (Nalini Meshram) Administrative Officer"

5. The aforementioned letter was subsequently withdrawn by the communication dated 30.08.2017 (which is impugned herein).

6. Mr Das, the counsel for the petitioner submitted that the said impugned communication was bad in law as it violates the principles of natural justice. He referred to the decision ofthis Court in KSL &Industries ltd V. National Textile Corporation Ltd:2012 (3) Arb. LR 470 (Delhi) and on the strength ofthe said decision contended that even in matters where an arbitration agreement exists between the parties, termination ofthe principal agreement in violation ofprinciples ofnatural justice, is liable to be stayed.

7. Next, Mr Das referred to the decision ofthe Constitution Bench ofthe Supreme Court in SM Mukherjee v. Union ofIndia:AIR 1990 SC 1984, in support of his contention that State was required to follow the principles ofnatural justice and provide reasons for their actions. Lastly, he referred to the decision of this Court in Ashish Gupta v. IBP Co. Ltd. & Anr.: 125 (2005) DLT298 in support ofhis contention that even in contractual matters this Court would intervene under Article 226 of the Constitution of India in cases where principles ofnatural justice were violated.

8. In the present case, the communications between the parties was in W.P. fC) R0^4/2017 • — Pas:e3of[5].iregard to a commercial matter relating to consultancy for construction works. Aplain reading ofthe communication dated 15.06.2017 (which was subsequently withdrawn), indicates that the petitioner was informed that he was selected for the works in question and was requested to depute the technical team to ascertain the work urgently. According to the petitioner, the said communication is a work order resulting in a concluded contract between the parties, which could not be unilaterally terminated.

9. Without going into the question whether the communication dated 15.06.2017 constitutes a concluded contract, it is apparent that the controversy involved in the present case pertains to a commercial transaction between the parties. Even if the petitioner's contention is accepted that the parties had entered into abinding contract, the same would be determinable. The relief sought, by the petitioner amounts to directing a specific performance ofthe same, which is not permissible. Further, it is not disputed that the petitioner has an alternate remedy. It is also well settled that the remedy under Article 226 is a discretionary one and ordinarily, this Court would not entertain a commercial dispute, where the parties have an alternate effective remedy.

10. The decision in the case of KSL & Industries ltd v. National Textile Corporation Ltd {Supra) which was relied upon by the learned counsel was rendered in a petition filed under Section 9 of the Arbitration and Conciliation Act, 1996 and, the Court after examining the disputes had issued an interim order. The said case has no application in the facts of the present case and is not an authority for the proposition that the Court while exercising powers under Article 226, would necessarily entertain matters relating to disputes in commercial matters. < W.P. (C) 8034/2017 4of[5]

11. The decision ofthe Constitution Bench ofthe Supreme Court in S.N. Mukherjee v. Union ofIndia {Supra) is also not relevant as it was rendered in the context of dismissal of awrit petition challenging the validity of the sentence recorded ina General Court Marshal.

12. Undoubtedly, this Court is not precluded from exercising jurisdiction under Article 226 of the Constitution of India. However, in cases where there are disputed questions relating to commercial matters and the petitioner has an alternate remedy, the Courts have, in a number of decisions, held that Article 226 of the Constitution of India would not present an apposite remedy. I

13. In view ofthe above, this Court is not inclined to entertain the present writ petition, leaving it open for the petitioner to take other remedies as available in law. I VIBHU BAKHRU, J SEPTEMBER 11,2017 pkv