LexKRISHAN LAL versus FOOD CORPORATION OF INDIA & ORS.
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[2012] 3 S.C.R. 571 KRISHAN LAL v. FOOD CORPORATION OF INDIA & ORS. (Civil Appeal Nos. 8569-8570 of 2003) FEBRUARY 24, 2012 [T.S. THAKUR AND GYAN SUDHA MISRA, JJ.] A B Tenders - Invitation of tenders for appointment of handling and transportation contracts at various depots - Submission of tender by the appellant offering to undertake C the work - Respondent-Corporation accepted the offer - Allotment of contract to the appellant - However, appellant expressed his inability to undertake the contract due to security problems and withdrew the offer made by him - Meanwhile, appellant had deposited certain amount towards security with D the respondent-Corporation, pursuant to the order of the High Court - Refusal of the Corporation to refund the amount - Writ petition by the appellant seeking refund of the security amount, dismissed - On appeal, held: There was an arbitration clause in the agreement executed between the parties and in view of E the nature of dispute, the claim for refund of the amount deposited by the appellant should have been raised before the arbitrator - However, the High Court had entertained the writ petition as early as in the year 2002 and the instant appeals had been pending in this Court for the past ten years F or so - Relegating the parties to arbitration when the matter has been pending for past ten years not feasible -Availability of alternative remedy cannot be pressed into service at this belated stage - The amount was deposited but was refundable in case the contract was not allotted and was adjustable G towards security if the appellant succeeded in emerging as the successful tenderer - In the event of adjustment of the amount towards security the breach of the contract would have led to the forfeiture of the security amount alone and not the entire 571 H / 572 SUPREME COURT REPORTS [2012] 3 S.C.R. A amount deposited by the appellant - Respondent-Corporation had engaged an alternative agency for getting the work executed and had incurred an extra amount in that regard and thus, could make a claim for recovery of the extra expenditure incurred by it - Corporation directed to refund the balance B amount to the appellant after deducting the amount towards forfeiture of security deposit and a sum towards extra expehditure in getting the work executed at the risk and cost of the appellant. C CIVIL APPELLATE JURISDICTION : Civil Appeal No. 8569·8570 of 2003. From the Judgment & Order dated 15.02.2000 of the High Court of Punjab & Haryana at Chandigarh in Civil Writ Petition No. 2416 of 2000 and Judgment & Order dated 23.05.2003 in D Review Application No. 134 of 2002. M.P. Jha, Ram Ekbal Roy, Anil K. Chopra for the Appellant. Indra Sawhney for the Respondents. E The Order of the Court was delivered T.S. THAKUR, J. 1. These appeals by special leave arise out of an order passed by the High Court of Punjab and Haryana whereby Civil Writ Petition No. 2416 of 2002 and RA. F No.134 of 2002 filed by the appellant seeking refund of Rs.10 lakhs deposited towards security pursuant to the order passed by the High Court has been dismissed. 2. On 12th November, 1999 the Food Corporation of India invited tenders for appointment of Handling and Transportation G Contracts at various depots including the depot at Dabwali in the State of Haryana. Several persons appear to have submitted their tenders in response to the said tender notice including M/s R.R.S. Chautala & Company who eventually bagged the contract in question having offered to undertake the H contracted work in consideration of payment at 186% above KRISHAN LAL v. FOOD CORPORATION OF INDIA & 573 ORS. [TS. THAKUR, J.] the schedule of rates. The appellant questioned the said A allotment in Writ Petition No.1368 of 2000, inter alia, alleging that he had been illegally prevented from submitting his tender by being denied the requisite form for submission of the tender. The appellant also asserted that he was ready to undertake the Handling and Transportation work at a much lower rate of 110% B above the schedule of rates as against 186% offered by the successful tenderer mentioned above. The appellant even offered to deposit a sum of Rs.10 lakhs by way of security to show his bona fides. An affidavit to that effect was also, it appears, filed by the appellant. c 3. The Writ Petition filed by the appellant was eventually allowed by the High Court by its order
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