Case BriefsHigh Courts

Delhi High Court: On finding no ground for interference in the arbitral award, Anup Jairam Bhambhani, J., upheld the decision of Single Judge Bench.

Instant appeal was filed under Section 13 of the Commercial Courts Act 2015 read with Section 10 of the Delhi High Court Act 1966 and Section 37 of the Arbitration and Conciliation Act 1996 impugning the decision of Single Judge of this Court. In the said decision arbitral award made by the sole arbitrator was upheld.

Background

Railways had filed a petition under Section 32 of the Arbitration and Conciliation Act challenging the arbitral award in which Railways was directed to refund to Annavaram the sum of Rs 1,22,38,125 which had been deducted/withheld by the Railways as ‘liquidated damages’ imposed upon Annavaram for alleged breach of the terms and conditions of a tender, pursuant to which a Letter of Acceptance was issued by the Railways to Annavaram for supply of 10000 Pre-Stressed Concrete Sleepers.

Non-Performance & Non-Compliance

The reason for the dispute was the non-performance and non-compliance with the terms of Letter of Acceptance. As Annavaram did not supply even a single sleeper within the stipulated time, nor did they obtain any extension of time for making such supply.

In view of the above background, penalty was imposed and then the contract was terminated.

Mr R.K. Sanghi, Senior counsel appearing for Annavaram contended that by inserting clause 1.2, a new condition came into effect whereby the parties agreed that the quantity of sleepers ordered under the original tender stood “… reduced to the number of sleepers manufactured till the date of issue of LoA for the new contract …”; and it was contended, that as a result there was no obligation on Annavaram to supply 10000 sleepers by 14-07-2009.

Consequently, it was argued that, the Railways were not justified in imposing any liquidated damages upon Annavaram.

Analysis, Law and Decision

Firstly, the High Court stated that there is limited scope and ambit of a challenge under Sections 34 and 37 of the A&C Act, which are pithily set out inter alia in the Supreme Court decision of PSA SICAL Terminals (P) Ltd. v. Board of Trustees of V.O. Chidambranar Port Trust Tuticorin, 2021 SCC OnLine SC 508, in which the Supreme Court reiterated its view on MMTC Limited v. Vendanta Limited, (2019) 4 SCC 163 wherein it was observed that:

“As far as Section 34 is concerned, the position is well-settled by now that the Court does not sit in appeal over the arbitral award and may interfere on merits on the limited ground provided under Section 34(2)(b)(ii) …”

“It is only if one of these conditions is met that the Court may interfere with an arbitral award in terms of Section 34(2)(b)(ii), but such interference does not entail a review of the merits of the dispute, and is limited to situations where the findings of the arbitrator are arbitrary, capricious or perverse, or when the conscience of the Court is shocked, or when the illegality is not trivial but goes to the root of the matter. An arbitral award may not be interfered with if the view taken by the arbitrator is a possible view based on facts.”

“…the court cannot undertake an independent assessment of the merits of the award, and must only ascertain that the exercise of power by the court under Section 34 has not exceeded the scope of the provision.”

Therefore, Bench held that so long as the view taken by an arbitrator, is a possible view based on facts, it is irrelevant whether this Court would or would not have taken the same view on the merits of the matter, hence arbitral award was required to be upheld.

Hence, impugned judgment was upheld.

Conclusion

Annavaram entitled to receive from the Railways the amount directed to be refunded in the arbitral award along with simple interest at 6% per annum till the date of payment as per the impugned judgment. [Union of India v. Annavaram Concrete Pvt. Ltd., 2021 SCC OnLine Del 4211, decided on 31-8-2021]


Advocates before the Court:

Ms Geetanjali Mohan, Advocate.

Mr R.K. Sanghi, Senior Advocate with Mr Satjendar Kumar, Advocate and Mr Ishan Sanghi, Advocate.


Additional Reading:

“There is a disturbing tendency of courts setting aside arbitral awards …”: SC upholds arbitration award of Rs 2728 crore plus interest in favour of Delhi Airport Metro Express (P) Ltd.

Foreign arbitral award enforceable against non-signatories to agreement; ‘perversity’ no longer a ground to challenge foreign award; tort claims arising in connection with agreement are arbitrable: SC expounds law on foreign awards

Arbitrator cannot rewrite contract for parties; Arbitral award based on no evidence or in ignorance of vital evidence comes in realm of patent illegality: SC   

Can Courts modify Arbitral Awards under S. 34 of Arbitration Act or is power limited? SC decides

Del HC | Ambiguity in contractually stipulated obligations favours whom? Court discusses while refusing interference in arbitral award

Del HC adverts to scope of judicial review of an arbitral award; Wades through bunch of pleas including violation of Part 1, CPC and insurance against breakage during transit, etc.

 

Case BriefsSupreme Court

Supreme Court: The Division Bench comprising of Rohinton Fali Nariman* and B.R. Gavai, JJ., addressed the issue of overstepping of review jurisdiction by the High Courts in policy matters. The Bench expressed,

“Judicial review in these matters is equivalent to judicial restraint in these matters…the writ court does not have the expertise to correct such decisions by substituting its own decision for the decision of the authority.”

Background

A Tender Call Notice (TCN) was issued by SCB Medical College and Hospital, Cuttack, inviting sealed tenders in a two-bid system (technical and financial) from eligible registered diet preparation and catering firms/suppliers etc. having a valid labour licence and a food licence with a minimum of three years of relevant experience in the field of preparation and distribution of therapeutic and non-therapeutic diet.

Pursuant to the aforesaid TCN, four bids were received by the Tender Committee. Vide the Technical Committee meeting dated 17-02-2020, Respondent 1 and Respondent were held to be disqualified inter alia for the reason that they had not submitted a valid labour licence, i.e., a contract labour licence from the competent authority, as per the TCN requirement and the Appellant and Respondent 5 were shortlisted for opening of financial bids. Consequently, the Tender Committee opened the financial bids, and found the Appellant to be the lowest bidder, quoting an average cost of Rs.82/- per patient per day. Meanwhile, Respondent 1 filed a writ petition before the High Court, praying that the Tender Committee proceedings be set aside and that Respondent 1 be awarded the tender.

Findings of the High Court

The High Court opined that the eligibility criteria were candid and clear requiring valid license of Labour Department. The said stipulation never mandated the license to be issued under the Contract Labour (Regulation and Abolition) Act, 1970. In the wake of the purpose, which was to supply diet, therapeutic and non- therapeutic to the patients to the hospital, there was no need for labour license under the Contract Labour Act. Hence, the bid of the Petitioner was found to be rejected illegally and contrary to the conditions of the TCN.

Whether a registration certificate under Shops and Commercial Establishments Act, 1956  can be the equivalent to labour licence issued under the Contract Labour Act, 1970?

The respondent argued that the TCN did not require that establishments/firms etc. that applied have 20 or more workmen, hence, it was obvious that it was not this Contract Labour Act that was the subject matter for eligibility but it was the Orissa Act, the registration certificate under which was produced to the satisfaction of the High Court by Respondent 1.

The Court observed that the requirement of Contract Labour Act that its applicability be extended only to establishments in which there are 20 or more workmen can be done away with by the appropriate government under the proviso, making it clear that this was not an inflexible requirement. In any case, the acceptance of such argument would amount to second-guessing the authority’s interpretation of its own TCN which could not be so second-guessed unless it was arbitrary, perverse or mala fide. The Bench stated that,

The registration of an establishment under the Orissa Act was to categorise the establishment as a shop, commercial establishment, hotel, etc. and not for the purpose of issuing a labour licence which, in the context of the present TCN, could only be a labour licence under the Contract Labour Act.

Judicial Review or Judicial Restraint?

The Court had repeatedly held that judicial review in these matters is equivalent to judicial restraint in these matters. What is reviewed is not the decision itself but the manner in which it was made. The writ court does not have the expertise to correct such decisions by substituting its own decision for the decision of the authority. Referring to the judgment in Silppi Constructions Contractors v. Union of India, 2019 SCC OnLine SC 1133, wherein, the Court had held that, the authority which floats the contract or tender, and has authored the tender documents is the best judge as to how the documents have to be interpreted. If two interpretations are possible then the interpretation of the author must be accepted; the Court stated that the constitutional courts must defer to this understanding and appreciation of the tender documents.

In any case, a registration certificate under Section 4 of the Orissa Act could not possibly be the equivalent of a valid labour licence issued by the labour department. High Court, in second-guessing the authority’s requirement of a licence under the contract Labour Act, has clearly overstepped the bounds of judicial review in such matters.

Decision

Hence, the Bench concluded that except for an incantation of the expression mala fide, no mala fide had in fact been made out on the facts of this case. The High Court’s judgment was set aside and the Appellant was directed to be put back to complete performance under the agreement entered into between the Appellant and the authority.

[M/S Utkal Suppliers v. M/S Maa Kanak Durga Enterprices,  2021 SCC OnLine SC 301, decided on 09-04-2021]


Kamini Sharma, Editorial Assistant has put this report together

*Judgment by: Justice Rohinton Fali Nariman

Know Thy Judge| Justice Rohinton F. Nariman

Appearance before the Court by:

For the Appellant: Sr. Adv. Siddhartha Dave

For the Respondent 1: Adv. Aditya Kumar Chaudhary

Case BriefsSupreme Court

Supreme Court: The bench of MM Shantanagoudar* and Vineet Saran, JJ has lucidly explained the law governing consent decree and has held that the well settled law that consent decrees are intended to create estoppels by judgment against the parties, thereby putting an end to further litigation between the parties, does not apply as a blanket rule in all cases.

In Gupta Steel Industries v. Jolly Steel Industries Pvt. Ltd.,  (1996) 11 SCC 678 and Suvaran Rajaram Bandekar v. Narayan R. Bandekar, (1996) 10 SCC 255, it has been held by the Supreme Court that it would be slow to unilaterally interfere in, modify, substitute or modulate the terms of a consent decree, unless it is done with the revised consent of all the parties thereto.  

However, in Byram Pestonji Gariwala v. Union Bank of India, (1992) 1 SCC 31, it has been held that a consent decree would not serve as an estoppel, where the compromise was vitiated by fraud, misrepresentation, or mistake. Further, this Court in the exercise of its inherent powers may also unilaterally rectify a consent decree suffering from clerical or arithmetical errors, so as to make it conform with the terms of the compromise.

Hence, keeping in line with the Court’s jurisprudence in the above mentioned cases, the Court said that it would be cautious in exercising it’s inherent power to interfere in this consent decree, except where there is any exceptional or glaring error apparent on the face of the record.

[Compack Enterprises India (P) Ltd. v. Beant Singh, 2021 SCC OnLine SC 97, decided on 17.02.2021]


Judgment by: Justice MM Shantanagoudar

Hot Off The PressNews

Ministry of External Affairs issues statement with regard to China’s discussion in UNSC on Jammu and Kashmir:

“We have noted that China initiated a discussion in the UN Security Council on issues pertaining to the Indian Union Territory of Jammu & Kashmir.

This was not the first time that China has sought to raise a subject that is solely an internal matter of India. As on such previous occasions, this attempt too met with little support from the international community. We firmly reject China’s interference in our internal affairs and urge it to draw proper conclusions from such infructuous attempts.”


Ministry of External Affairs

[Statemnet dt. 06-08-2020]

Case BriefsHigh Courts

Madhya Pradesh High Court: This petition was filed before a 2-Judge Bench comprising of S.C. Sharma and Virender Singh, JJ., against a judgment passed in appeal by the Debts Recovery Appellate Tribunal, Allahabad.

Facts of the case were that petitioner took a loan and after non-payment of interest, the account was declared to be a non-performing asset. The details referred established that there was an outstanding balance continuously in excess of the sanctioned limit or drawing limit from the month of December, 2008 to February, 2009. Thus, petitioner’s property was kept in possession of Bank symbolically under Section 13(4) of the SARFAESI Act, 2002. Court was of the opinion that the account of the petitioner was rightly declared as NPA. While going through the process of auction, Court found no illegality on part of the Bank while recovering the dues from the mortgaged property.

High Court referred the case of Central Bank of India v. C.L. Vimla, 2016(1) MPLJ 101 and in light of the same, found no reason to interfere with the auction process conducted by the Bank, therefore, this writ petition was dismissed. [Mayunk Industries v. Union Bank of India, 2019 SCC OnLine MP 9, dated 03-01-2019]

Case Briefs

Madhya Pradesh High Court: A review petition was filed before a Single Judge Bench of Sujoy Paul, J., to review an order passed by this court.

Respondent had availed all the remedies available to him under M.P. Panchayat Service (D&A) Rules, 1999 where these rules were created under Section 70 of Panchayat Raj and Gram Swaraj Adhiniyam, 1993.

Petitioner submitted that respondent could not have availed the remedy under Section 91 of the Adhiniyam. Rules of 1999 prescribed remedy of revision, which was admitted to have been exhausted by respondent. Once a specific rule dealing with service matters and disciplinary action were framed i.e. Rules of 1999, and respondent had exhausted all the remedies available therein, respondent could not have preferred an appeal under Section 91. Since Section 70 was an enabling provision, the rules framed there under cannot override Section 91 of the main Adhiniyam. Section 91 states that an appeal was maintainable against the orders of Panchayat and other authorities under the Act. Thus revision before government was maintainable.

The High Court was of the view that even if it is accepted that revisional power exercised by the State Government was in fact under the M.P. Panchayat (Appeal & Revision) Rules, 1995 and not under Section 91 of the main Act, the outcome would not change because the power is with the State Government under Section 91 of the Act to interfere with the order passed by an authority under the Act. If a wrong provision is mentioned while exercising the power, it would not stop the Competent Authority to exercise the appellate power. The Court found no reason to review the order passed earlier. Therefore, the petition was dismissed. [Gram Panchayat Khaira Janpadh Panchayat Rewa v. State of M.P., RP. No. 1664 of 2018, dated 14-11-2018]

Telangana High Court
Case BriefsHigh Courts

Hyderabad High Court: A Single Judge Bench comprising of Gudiseva Shyam Prasad, J. dismissed a writ petition at the admission stage on account of it being misconceived.

The petitioner filed a writ petition seeking the relief in the nature of writ of mandamus under Article 226 of the Constitution of India over the protection and preservation of his title and possession over the land which was being interfered with by the defendants.

The defendant pressed upon the fact that instead of resorting to the present writ petition along with seeking police protection, the petitioners should have approached the court by way of execution petition.

The Court agreed with the submission of the defendants that it was a civil matter and if the petitioner needed police aid he should have had sought for the orders for the same. The police cannot interfere in any civil dispute unless directed by any competent court to its effect.

Accordingly, with regard to the misconceived writ petition, the matter stood closed. [Tirumala Siva Prasad v. State of A.P.,2018 SCC OnLine Hyd 262, order dated 17-04-2018]

Case BriefsHigh Courts

Madhya Pradesh High Court: This appeal was filed under Section 2(1) of Madhya Pradesh Uchcha Nyayalaya (Khand Nyay Peeth Ko Appeal) Adhiniyam, 2005 before a 2-Judge Bench comprising of Sanjay Yadav and Vivek Agarwal, JJ., against the order where petitioner, a Revenue Inspector was transferred from Municipal Council, Ashoknagar to Municipal Council, Ganjbasoda.

The facts of the case were that appellant, a Municipal employee having hometown as Ashoknagar along with 24 Municipal employees were transferred from one Municipal Council to another. It is this order of transfer which was challenged by the appellant in this appeal. It is to be noted that this transfer was due to administrative exigency passed by State Government under section 58 of M.P. Municipal Corporation Act, 1956 and under sub-section (7) of Section 94 of the M.P. Municipalities Act, 1961. The rationale behind such transfer was found to be to not allow an employee to work in their hometown and the appellant was working in Ashoknagar for eight years.

Appellant contended that his family life would be adversely affected due to the transfer. Court found this ground not appropriate for interference by the judiciary. High Court found no illegality in the impugned order, therefore, the appeal was dismissed. [Shamshad Pathan v. State of M.P.,2018 SCC OnLine MP 719, dated 12-10-2018]

Case BriefsHigh Courts

Allahabad High Court: A Single Judge Bench comprising of Kaushal Jayendra Thaker, J., partly allowed the writ petition where petitioner prayed for the non-interference of respondent in their married life and to protect their lives and liberty.

Events leading to this petition was the threatening and harassment to petitioner by private respondent and their other family members. Petitioners were adults who had married on their own free will and were apprehending a serious danger to their lives which could be caused by respondent. Petitioner submitted before Court their age proof and online application for registration of their marriage.

Court referred three decisions of Supreme Court Gian Devi v. Nari Niketan, (1976) 3 SCC 234; Lata Singh v. State of U.P., (2006) 5 SCC 475; and Bhagwan Dass v. State, (2011) 6 SCC 396 and stated the settled position of law that if married couple are living of their free will, then, nobody including their parents, has authority to interfere with their lives together.

The High Court was of the view that petitioners had every right to live together peacefully and no one can be permitted to interfere. Further, petitioner were given liberty to approach concerned police authority, in case of any disturbance, for immediate protection who shall provide the same. [Shahin Bano v. State of U.P.,2018 SCC OnLine All 1346, order dated 20-09-2018]

Uttarakhand High Court
Case BriefsHigh Courts

Uttaranchal High Court: A Single Judge Bench comprising of Manoj K. Tiwari, J., dismissed a writ petition as premature holding that there was no scope for interference in the issuance of show cause notice against the petitioner.

It was alleged that the petitioner was an unauthorised occupant over the property in question. A show cause notice was issued against him under Section 4 of U.P. Public Premises (Eviction of Unauthorised Occupants) Act 1972. The petitioner was asked to show cause as to why eviction order not be passed against him. The said show cause notice and the proceedings initiated pursuant thereto were put to challenge in the instant petition.

The High Court, on consideration of the record observed it to be a settled position of law that ordinarily a show cause notice cannot be challenged in a writ petition as it does not give rise to a cause of action. It does not amount to an adverse order which affects the right of any party unless the same has been issued by a person having no jurisdiction/competence to do so. In the instant case, it was not disputed that the Prescribed Authority was competent to issue show cause notice under the Act. Therefore, the Court found no scope of interference with the show cause notice, and the writ petition was consequently dismissed. [Neeraj Bansal v. Prescribed Authority, 2018 SCC OnLine Utt 608, dated 25-6-2018]

Case BriefsHigh Courts

Calcutta High Court: Biswanath Somadder, J. speaking for the Court comprising of himself and Arindam Mukherjee, J. dismissed an appeal challenging the judgment of the learned Single Judge who had dismissed the writ petition filed before him by the appellant.

The appellant had filed a writ petition before the learned Single Judge, who dismissed the petition on grounds of suppression of facts on the part of the writ petitioner (appellant). Admittedly, the petitioner had earlier obtained an interim order for age relaxation in the selection process, based on same pleas. The learned Single Judge was pleased to note the fact that a candidate was entitled to age relaxation only once. And such opportunity had been already availed of by the petitioner in 2015. Aggrieved by the dismissal of his petition, the appellant approached the High Court.

The High Court perused the record and observed that the Single Judge rightly found the appellant guilty of suppression of facts as relevant facts were not pleaded by the appellant. The Court categorically observed, in an intra-court appeal, no interference is usually warranted unless the impugned judgment suffers from palpable infirmities or perversities. The Court held that on a plain reading of the judgment, no such perversity was deductible, rather it was rendered with cogent and justifiable reasons. In such circumstances, the appeal was dismissed. [Panchanan Bera v. State of W.B.,2018 SCC OnLine Cal 3468, dated 13-06-2018]

Gauhati High Court
Case BriefsHigh Courts

Gauhati High Court: The appellant company invited tenders for transportation of gas cylinders to which the respondent company replied and was accepted to transport cylinders at the rate of Rs 65 per cylinder, excluding toll and ferry charges, as the respondent indicated on their price bid. Their bid was accepted and against production of appropriate government-issued receipts for toll and ferry charges, the respondent was reimbursed accordingly by the appellant from February 2001 to November 2001 over and above the amount agreed upon (i.e. Rs 65) but their bills for December 2001 to May 2004 were not cleared because another transporter on contract with the appellant had been charging considerably less for the transportation, to which the respondent replied saying that the transporter in question had been ferrying the cylinders on regular ferries with other goods and people while they had been hiring exclusive ferries in compliance with Explosive Rules and Regulation .

The appellant company contended that nowhere does the terms for the tender specify that toll and ferry charges will be paid over and above the charge agreed upon per cylinder, i.e. Rs 65. This was despite the fact that in the tender preceding this, i.e. the one in force till January 2001 and even for a few months of the contract with the respondent, these charges were ordinarily reimbursed over and above the price agreed in the tender documents. Hence the arbitrator allowed the respondent’s claim. This was challenged under Section 34 of the Arbitration and Conciliation At, 1996 (“Act”) but the challenge was dismissed by the District Judge and hence the appellant company approached the High Court under Section 37 of the Act.

The appellant’s grievance was that the arbitrator had not confined himself to the contract between the parties while passing his award. The tender document laid out Rs 65 as the all-inclusive charge of transportation and the contract contained no mention of toll and ferry

charges. The payment made for the first few months was the result of a mistake on part of the appellant and further, only because these charges were reimbursed separately historically is no ground for them to be reimbursed in the current contract as well. The arbitrator, according to the appellant, thus, went beyond the contract agreement and the District Judge also failed to take notice of this. Hence the arbitral award was hit by Section 34 of the Act, relying on Delhi Development Authority v. R.S. Sharma and Company, (2008) 13 SCC 80 and State of Rajasthan v. Nav Bharat Construction Co., (2006) 1 SCC 86.

The respondent-transportation company argued that though the original tender document made no provision for reimbursing toll and ferry charges, the same had been agreed upon during the finalization of the tender process by the appellant which is shown by the written statements filed by the appellant. These charges were also paid to the other transporter currently engaged by the appellant and also to previous such transporters. The arbitrator had taken all this into consideration while passing the award and though he did not stick to the four walls of the contract, his award was based on substantial evidence which was in no manner perverse and hit by Section 34. The respondent relied on the case of Oil and Natural Gas Corporation Ltd. v. Astra Construction (P.) Ltd., 2012 SCC OnLine Gau 515.

The Court held that as the claim for toll and ferry charges was allowed during the finalization of the tender proceedings, the appellant company could not refute the same payment only because the tender document did not provide for it. It also found that Rule D(2)(k) of the tender document which deals with ‘Safety’ mandates that the cylinders should not be transported with other goods and persons except the driver and cleaner of the truck. Also, evidence was produced to show that since no standard rate existed for the transfer of cylinders, the respondent was not wrong in resorting to hiring exclusive ferries.

The Court relied on McDermott International Inc. v. Burn Standard Co. Ltd., (2006) 11 SCC 181 to reiterate the supervisory role of the court in the arbitration proceeding, where intervention should happen only in cases of fraud or bias. The appellants raised objections to the authenticity of certain documents produced by the respondent in front of the arbitrator but subsequently failed to ask for court assistance in taking evidence, therefore waiving off that right.

Hence the Court held that the arbitrator passed his award well within the terms of the contract, keeping in view the safety guidelines prescribed for the transportation of gas cylinders and no interference was called for. The appeal was accordingly dismissed. [Indian Oil Corporation Ltd. v. Moni Madhav Dutta, 2018 SCC OnLine Gau 465, decided on 14-05-2018]

Case BriefsHigh Courts

Allahabad High Court: A Single Judge Bench comprising of Amit Sthalekar, J. ordered the petitioner (wife of a retired government servant) to vacate the government quarter occupied by her unathorisedly even after retirement of her husband who was a government servant.

The petitioner was unauthorisedly occupying the government quarter in question which was allotted to her husband when he was in government service. The husband of the petitioner had retired from government service twelve years ago but still the petitioner continued to occupy the quarters. Learned counsel for the petitioner submitted that the respondents be restrained from compelling the petitioner from vacating the said quarters in view of the order of the State Women Commission.

The High Court was of the opinion that the submission of the counsel for the petitioner was misconceived. The Court held that the State Women Commission had absolutely no jurisdiction to interfere in the service matters of an employee which are governed by statutory rules. Petitioner’s husband had retired from service twelve years ago; the petitioner continued to occupy the said quarters in wholly illegal and unauthorized manner. Accordingly, the petitioner was ordered to vacate the government quarter within fifteen days. [Asha Rai v. Purvanchal Vidyut Vitran BLW, 2018 SCC OnLine All 435, dated 20-04-2018]

 

Case BriefsHigh Courts

Karnataka High Court: A Single Judge Bench comprising of Ravi Malimath, J., decided a criminal appeal filed by the State under Section 378 of CrPC, wherein the order of acquittal of the accused passed by the trial court was upheld.

The accused was charged under Sections 324 and 504 read with Section 34 IPC. The prosecution led evidence to prove its case before the trial court but did not succeed and the accused was acquitted of the charges. Aggrieved by the said order of the trial court, the State preferred the instant appeal.

The High Court duly considered the submissions made by the Additional State Public Prosecutor who submitted that the prosecution proved its case beyond reasonable doubt; however, the Court was of the view that such submissions on behalf of the prosecution does not inspire confidence with the Court to take a view that there was any perversity in the order of acquittal passed by the learned trial court. The Court was of the view that the evidence was full of discrepancies, and the pleas of the complainant could not be accepted. Also, in an appeal against an acquittal, such order is not to be interfered with unless gross perversity in that order is shown. The Court did not find any reason to interfere with the impugned order and upheld the acquittal of the accused. Thus, the appeal filed by the State was rejected. [State v. Nasir alias Nasir Khan, Crl. Appeal No. 1263 of 2016, dated 19.2.2018]

Case BriefsSupreme Court

Supreme Court: In the controversy relating to bids invited by the Nagpur Metro Rail Corporation Limited for the design and construction of Metro Rail in the city of Nagpur, the Court held that M/s. Guangdong Yuantian Engineering Company (GYT) of China and M/s. TATA Projects Limited (TPL) as a Joint Venture (GYT-TPL JV) were not eligible to bid for the contract under consideration.

The issue arose in the light of one of the eligibility criteria specified by NMRCL where it was necessary that the bidder has satisfactorily completed a minimum number of similar contracts as a prime contractor, joint venture member during last 10 (ten) years i.e. up till 31.05.2016. According to GYT-TPL JV, it had executed the Pearl River Delta intercity high speed railway project in China, however, as per NMRCL, an inter-city high speed railway project did not meet the requirements of a metro civil construction work.

NMRCL has contended that there is a difference between an inter-city rail and a metro rail.  An inter-city rail is between two cities and the trains are usually high speed trains. A metro rail is intra-city, it has a dedicated right-of-way, normally it does not have high speed trains and the frequency of trains is much greater that of inter-city trains. A metro rail may extend, in some cases, to a suburb of a metropolitan city but it essentially remains an intra-city project. There is, therefore, a qualitative difference between an inter-city rail and a metro rail. By itself, this indicates a qualitative difference in a railway project that is inter-city and a railway project that is intra-city and the construction of a viaduct for a railway project that is inter-city and a railway project that is intra-city.

Considering the said difference highlighted by the he Court, hence, held that the fact that GYT-TPL JV made constructions in a metropolitan city or in a metropolitan area during the execution of the Pearl River Delta inter-city high speed railway project, does not make that project an intra-city metro rail project. It continues to be an inter-city railway project.

Regarding the interference with the decision of the owner or the employer in accepting or rejecting the bid of the tendered, the bench of Madan B. Lokur and R.K. Agrawal, JJ said that the owner or the employer of a project, having authored the tender documents, is the best person to understand and appreciate its requirements and interpret its documents. The constitutional Courts must defer to this understanding and appreciation of the tender documents, unless there is mala fide or perversity in the understanding or appreciation or in the application of the terms of the tender conditions. It is possible that the owner or employer of a project may give an interpretation to the tender documents that is not acceptable to the constitutional Courts but that by itself is not a reason for interfering with the interpretation given. [Afcons Infrastructure Ltd v. Nagpur Metro Rail Corporation Ltd, 2016 SCC OnLine SC 940, decided on 15.09.2016]