FOOD CORPORATION OF INDIA Vs. NAMITA PAUL

JUDGEMENT

(1.) We have combined both the appeals as the disputes emerge from the same contract being CONT.09/NEFR/TC/TVZ-CDR/09 dated 29.04.2009 which was formalised for transporting foodgrains etc. from railway sidings/FSD Churaibari to FSD Chandrapur for a period of two years from the date of acceptance of the tender.

(2.) Let us first deal with RFA 16 of 2019 [The Food Corporation of India and Anr. v. M/S Namita Paul] as the decision of this appeal will determine the fate of the other appeal being RFA No.17 of 2019 [The Food Corporation of India and Anr. v. M/S Namita Paul].

(3.) The appellants in RFA No.16 of 2019, Food Corporation of India had accepted the rate quoted by the respondent and communicated their acceptance by FAX dated 20.04.2009 and the letter dated 29.04.2009. While accepting the tender it was communicated that the contract shall be governed by its terms and conditions as provided in the tender document. The respondent was advised to commence work with effect from 30.04.2009. The rate quoted by the respondent was 47.5% above the scheduled rate proposed by the appellant-corporation. The said rate was worked out @Rs.1176.54 for transportation of food grains per metric ton. The respondents (hereinafter referred to as the transport contractor) deposited a sum of Rs.4,73,500/- by demand draft as security, out of the total security deposit quantified at Rs.47, 41,000/-. For couping the said amount, another sum of Rs.18,97,000/- was deposited. it was agreed that the earnest money would be converted as the security deposit. It was further agreed that the balance of the security deposit to the extent of Rs.23,70,500/- was to be deducted from the bills of the transport-contractor. In terms thereof, the work order dated 29.04.2009 for transporting food grains from railway sidings/FSD Churaibari to FSD Chandrapur with effect from 30.04.2009 was issued in favour of the transport-contractor. The transport-contractor had resumed the work of transportation with effect from 01.05.2009 and with intimation to the corporation she had suspended the work on 24.12.2010, after 20 months from its inception. For such decision of the transport-contractor suspending the transportation had serious impact. According to the corporation, it affected the public distribution system. The corporation had repeatedly requested the transport-contractor to restore the transportation and adhere to the contractual obligation in order to maintain the adequate stock of food grains in the corporation-godowns, but the transport-contractor defied such request. By a series of letters under No.F.9/NEFR/HTC/MISC/Corres/2008-09 dated 18.10.2010, 19.10.2010, 20.10.2010, 06.11.2010, 09.11.2010 and 12.11.2010 the corporation had informed the contractor that for her failure to perform the contractual obligation, she shall be liable for breach of the contract and she had to bear the cost and risk for non-performance of the work assigned under the contract/agreement. The corporation by invoking the Clause-X(c) of the Contract invited the interested and eligible transporters to do the unperformed work as abandoned by the transport-contractor by floating the tender notice vide No.Cont.9/AGT/Adhoc/R&C/CBZ/2009-10 dated 03.12.2010 and thus, the appellant had appointed ad-hoc contractors for transportation of food grains for a period of six months with effect from 24.12.2020, as is evident from the letter No.Cont.9/DO-AGT/TC/CBZ/Adhoc/2010/2781 dated 24.12.2020. According to the corporation, the rate as claimed by the ad-hoc contractors and as accepted by the corporation was 157% above the scheduled rate which was disproportionately higher than the rate quoted by the transport-contractor (the respondent). But in order to saving the public distribution system from collapse and for lifting the accumulated food grains from FSD, Churaibari, those ad-hoc contractors were appointed at the risk of the transport-contractor (the respondent). But the corporation did not rescind the contract, awarded to the transport-contractor. Thus, she was at liberty to carry on the transportation in terms of the said contract. It appears further that those ad-hoc contractors transported the food grains from FSD, Churaibari to FSD, Chandrapur in that highly escalated rate until expiry of the period of six months on 23.06.2011. Thereafter, the regional office of the corporation by their letter dated 22.06.2011 appointed another ad-hoc contractor for six month at the risk and cost of the transport-contractor (the respondent) for the period from 24.06.2011 to 23.12.2011. The corporation has claimed that they were constrained to appoint the ad-hoc contractors, as the regular contractor (the respondent) suspended the transportation abruptly. The said arrangement for transportation of the food grains etc. from FSD Churaibari to FSD Chandrapur was made at the risk and cost of the regular contractor (the respondent).