@JUDGMENTTAG-ORDER
Navaniti Pd. Singh, J.@mdashThe present writ petition has been filed for quashing the letter No. 280 dated 18.8.2008 issued by the respondent No. 6, the Deputy Chief Engineer (Construction), Ganga Rail Bridge, East Central Railway, Digha Ghat, Patna and also for quashing the re-tender notice for the said work, "at the risk and cost of the petitioner". The later relief, as sought for by interlocutory application is as a consequence of re-tender issued during the pendency of the writ petition.
2. The petitioner is a Company, which undertakes large civil construction work including for the Railway. It appears that over river Ganga at Digha in Patna, a railway cum road bridge is proposed to be made under the supervision of East Central Railway. Accordingly fresh railway lines have to be laid to the bridge under construction. This railway track is to cross the Bailey Road, which runs East to West from Patna - Danapur. On the said track, a road over bridge giving a clearance of 15 mtrs over the railway track had to be made.
3. It appears that the railway first advertised for the construction of the same (road over bridge) and tender having been settled, the tenderer defaulted, as a consequence of such default, a fresh tender at the risk and cost of the earlier tenderer was issued being Ternder No. 76/2006-07. The estimated cost of this road over bridge was Rs. 15.42 crores. Petitioner responded and was selected and ultimately letter of acceptance dated 12/13.2.2007 was issued in favour of the petitioner. Petitioner''s tender was accepted at Rs. 19,11,01,221.84. Work was to be completed within fifteen months from the date of issuance of letter of acceptance i.e. 11.5.2008. On 30.4.2007 an agreement was entered into between the East Central Railway and the petitioner for the aforesaid work.
4. The said over bridge had a Central Section over the railway track to be laid out. The Central Section consisted of bridge pier and span over it. The approach on both ends was to be of re-enforced earth (RE), meaning thereby that the outer surface and rising approach road were to be made with reinforced concrete and were to be filled by Mud and road laid thereon.
5. This design had to be initially prepared by the petitioner and with certain test certificate and other certification got approved from the railway. The work on the approach road was to start only thereafter.
6. Petitioner-Company appointed the Central Road Research Institute, Delhi, as its consultant for designing the same. There is a lot correspondences between the two. Ultimately, the result whereof was that they recommended that each filled approach road should not rise above 7 Mtrs. The result was that the rest 8 Mtrs of gain in height of the approach road on both the sides were to be made of complete cement casting which is known as "via duct". Railway got this examined by its own associate RITES and thus approved the plan. The consequence of this was that the tender, which was of Rs. 19 crores now increased, because of this additional work being constructed on both the approaches, to Rs. 36 crores. Originally via ducts of such large magnitude was not contemplated. In the meantime, petitioner had already taken up construction of the Central Section of casting design, whereof was also altered by the railway but the Central Section work progressed. On being confronted with this change of scope of work as also the nature of work, railway themselves thought it proper to tender for this part of additional work separately. This additional work of constructing via duct work was then tendered afresh for an estimated cost of Rs. 24.50 crores separately. Thus, it would be seen that now the road over bridge consisted of two parts, one of which the petitioner was executing and the other in between, of construction of via duct on both sides adjacent to main Central Section and span.
7. In response to this fresh tender for via duct, it is not in dispute, two tenders were received by the railway but they have not been acted upon by the railway. Those tenders having been issued, the scope of petitioner''s work, as originally contracted, was reduced and as such petitioner wrote a letter on 12th April, 2008 (Annexure 18) to the respondent-railway that notwithstanding the varied quantity and reduction of work, they were ready to proceed with the balance work at the same rate, subject to price variation clause. It appears that the railway apparently misunderstood the said letter (Annexure 18). They responded by letter dated 15.6.2008 (Annexure-21) and pointed out that the petitioner was required to accept the variation of quantity and accordingly the petitioner were directed to take up the varied work as well meaning thereby the entire work notwithstanding their own separate fresh tenders for via duct. Petitioner immediately responded that they had only consented by letter through Annexure 18 to the reduced quantity of work and not in respect of entire work. This letter is of the 1st of July, 2008 (Annexure 22). This letter was responded by letter dated 18.8.2008 (Annexure 23) of the railway, which is the letter in dispute and being impugned. By this letter, railway has taken the later letter of the petitioner (Annexure 22) as a letter refusing to accept the variation and treating the agreement as cancelled. They have specifically referred to certain clauses of the contract, which says that a contractor is bound to execute the extended/additional quantity of work at the rates quoted till the work is completed. Non -signing of variation agreement by the petitioner for the entire work was taken to be a breach of contract and now the railway advertised the entire work afresh "at the risk and cost of the petitioner". In fact, subsequently giving credit to the work already done by the petitioner, the balance entire work has been re-advertised for tender at the cost of Rs. 37 crores, which was corrected by corrigendum to Rs. 39 crores.
8. Petitioner''s submissions are short. Petitioner submits that the original scope of work was worth about Rs. 19 crore only. In view of technical difficulty and alteration in design and construction of new via ducts on each side, the scope of work was virtually doubled and enhanced to about Rs. 37 crores. This cannot be additional, enlarged or extended quantity of work. This virtually amounted to new work which had to be re-tendered and could not be done at the rate tendered earlier.
9. It is submitted that even the railway initially took it to be so. They themselves realized that this was virtually totally a new work and was beyond the scope of earlier agreement of the petitioner. That is why they had issued fresh tender for this additional work independent of the petitioner but for some reason, the railway was not in a position to finalize the same with other tenderer. They had arbitrarily decided to thrust it upon the petitioner and force the petitioner also to undertake this additional work which was virtually a new work altogether, as would appear from the cost itself which had virtually doubled. The railway urges that it was mere an enlargement of work and the petitioner was bound to accept it and not doing it was a breach of original agreement and as such the railway has rightly re-tendered the entire balance work "at the risk and cost of the petitioner". This stand of the railway that is impugned in the present proceedings.
10. From the facts stated above, it is not in dispute that the railway and the petitioner both at the initial stage were concerned with the road over bridge without any substantial work in relation to via duct at both ends. The tender was considered worth about Rs. 19 crores. On technical appraisal by the expert, the entire design on both side approach road had to undergo substantial change. The result whereof was that the scope of work more than double. This is not disputed. Petitioner asserts that it is not mere extension and enlargement of work but virtually a new work altogether which petitioner was not obliged to undertake under the original agreement. It is in that view of the matter that the petitioner vide his letter, as contained in Annexure 18, offered to continue with the reduced scope of work i.e. the total work minus the new via duct, as envisaged in the new plan. It is also not in dispute that the railway itself, at the first, was of the same view, for it itself advertised separately the additional work at a cost of Rs. 24 crores. It entertained two tenders. This was specifically pleaded by the petitioner in the writ petition but the railway have chosen neither to contradict the same nor explained as to what was the result of both of those two tenders and why the railway did not proceed with them rather in their counter affidavit, railway have virtually given a go by to those pleadings. The inference that can be drawn is that it was inconvenient truth that the railway could not face and could not reconcile with the ultimate decision taken by them. It is thus apparent that there were some other difficulty with the railway in granting fresh contracts to other person for this work and therefore they decided to enforce it on the unwilling petitioner. This, in my view, cannot be permitted. It was not only enlargement and variation of work. This so called enlargement or variation compared to original work became the dominant work. That cannot be a scope of such a clause in the agreement.
11. In contract when such variation and enlargement is permissible, it is only incidental enlargement and not a totally new work, as indicated above. The reason is more than one. Firstly when the parties tender considering the volume of work, the time involved, the labour involved and the price of their project is based thereon but if it is so materially altered the tender prices may have no relevance to the altered scope of work. Secondly, once prices are fixed for a particular work, then it does not follow that even if the work is doubled with a totally different nature of work, the rates would remain the same. Via ducts are solid concrete casting. The sum total cost of which is more than the total estimated work, which the petitioner had undertaken. The same rate cannot apply to the extend work much less as quoted much earlier without anticipating these new constructions of such a large scale. To hold that the petitioner was bound to do the work would virtually be like. If a person contracts to carry passengers from Calcutta to Delhi with permissible diversion or deviation or enlargement he cannot be asked to carry the passengers between the two destinations via Madras. That would be completely a new contract.
12. In the present case, the railway also understood it to be so. It issued tender for it separately, while the petitioner was working his original left over work but for some undisclosed reason or difficulty on the part of the railway, it was thrust on the petitioner who rightly refused to accept the same.
13. Here I may refer to Annexure 18 of the writ petition. Annexure 18 if read as a whole clearly states that notwithstanding alteration in design etc, petitioner was ready to do the reduced the work at the same rate. Obviously, reduced work meant what was left after viaduct which by then had already been tendered separately by the railway. This letter has been misconstrued by the railway by reading only a part of the letter and not the whole letter in the facts, which were obtaining on that date. On that date for the road over bridge there was a tender in favour of the petitioner and there was a separate notice inviting tender for the via duct, a part of the road over bridge. It is this work, which was separately tendered by the railway, which reduced the scope of petitioner''s work which he had undertaken to complete. This was so because if the quantity of work was substantially reduced, the petitioner had a right to withdraw because again the rates quoted may not be favourable or for other reason but the petitioner agreed to complete the remaining work Railway then entrusted and thrusted upon the petitioner the entire work. When this was clarified by the petitioner, petitioner was accused of breach of agreement. There was no breach of agreement as this Court finds. Railway itself had altered the agreement by separately tendering the work. That being so, the entire work could not be thrust upon the petitioner and the railway is free to get via duct constructed separately by any other contractor as it had contemplate earlier. Petitioner was ready to do the balance work and as such has not breached any part of the agreement in any manner. That being so, if the railway rescinded the entire contract and is to re-tender the entire block then that would certainly not be "at the risk and cost of the petitioner". The petitioner surely cannot be thrust with the cost of work which it had never undertaken. It had only undertaken a contract worth Rs. 19 crores and now cannot be made liable under "the risk and cost of" contract of almost Rs. 39 crores. Thus, the impugned letter of railway, as contained in Annexure 23, being dated 18.8.2008 cannot be sustained nor Annexure 24, the order dated 17.10.2008 by which the entire work of the petitioner has been rescinded nor the re-tender of the entire work at the risk and cost of the petitioner. Those are thus set aside.
14. The writ petition thus succeeds and with the aforesaid observation and direction, this writ petition is allowed.
Railway would consequently be well advised to clear the payments of the petitioner in respect of work already done by it expeditiously.
