M/S Khodal Corporation vs West Central Railway … on 7 April, 2026

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    Rajasthan High Court – Jaipur

    M/S Khodal Corporation vs West Central Railway … on 7 April, 2026

    [2026:RJ-JP:14404]
    
            HIGH COURT OF JUDICATURE FOR RAJASTHAN
                        BENCH AT JAIPUR
    
                      S.B. Civil Writ Petition No. 6148/2026
    
    M/s Khodal Corporation, Viramgam, 7, Ramnagar Society, Ioc
    Colony Road, Viramgam - 382150 Gujarat, India Through Its
    Through Its Power Of Attorney Holder Shri Shubham Hareshbhai
    Patel Aged S/o Shri Hareshbhai Patel, Around 26 Years R/o
    Viramgam, 7, Ramnagar Society, Ioc Colony Road, Viramgam -
    382150 Gujarat
                                                                            ----Petitioner
                                            Versus
    1.       West Central Railway, Through Its General Manager, Head
             Quarter Office, Opposite Indira Market, Jabalpur, Madhya
             Pradesh -482001
    2.       Chief       Administrative        Officer      (Construction),      Western
             Central Railway, Head Quarter Office, Opposite Indira
             Market, Jabalpur, Madhya Pradesh -482001
    3.       Chief Project Manager (Cpm), West Central Railways, Drm
             Office, Kota, Rajasthan - 324002.
    4.       Deputy Chief Engineer (Construction-Ii), West Central
             Railways, Drm Office, Kota, Rajasthan - 324002.
                                                                         ----Respondents
    For Petitioner(s)             :     Mr. O.P. Singh Tanwar
                                        Ms. Rajeshwari Tanwar
                                        Mr. Adesh Arora
    For Respondent(s)             :     Mr. C.S. Sinha with
                                        Ms. Anima Chaturvedi for ASG
    
    
    
                     HON'BLE MR. JUSTICE SAMEER JAIN
    
                                         Judgment
    
    07/04/2026
    
    

    1. Learned counsel for the petitioner submitted that the present

    petition is filed assailing the illegal and arbitrary termination notice

    SPONSORED

    dated 25.03.2026. It is submitted that a NIT (Notice Inviting

    Tender) was issued on 13.02.2024 by the respondents; resultant

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    to which upon completing due formalities a letter of acceptance

    was issued in favor of the petitioner, and as per terms and

    conditions of the tender, petitioner furnished the required

    Performance Bank Guarantee and also submitted the security

    deposit. It is submitted that time was essence of the contract and

    completion period of the work was nine months i.e. up to

    15.01.2025.

    2. It is contended that there was a delay on account of late

    handover of the working site, and that these circumstances are

    beyond the petitioner’s control, therefore, the petitioner has

    sought extension of time vide letter dated on 30.12.2024. It is

    further submitted that with Price Variation Clause (PVC), the

    respondents themselves acknowledged the delay and essentials

    were granted, however in spite of the same being done

    respondents issued a seven days’ notice dated 23.01.2026 under

    Clause 62 of the GCC, alleging inadequate progress.

    3. Further, it is submitted that another seven days’ notice dated

    20.02.2026 was issued alleging similar deficiencies, thereafter a

    48 hours’ notice dated 28.02.2026 was also issued, threatening

    rescission of the contract. It is submitted that the petitioner has

    replied the said notice(s) on 28.02.2026, explaining that more

    than 85% of the work is already completed, and that delays were

    on the part of the respondents. It is submitted that in-between

    the said period, the Commissioner of Railway Safety (CRS)

    conducted the statutory inspection of the project on 18.03.2026

    and the railway line was provisionally authorized on 21.03.2026

    for public carriage of passengers at a speed of 75 kmph.

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    4. In this background, learned counsel for the petitioner has

    submitted that the conciliation attempt of invocation of bank

    guarantee forfeited, qua the risk and cover of petitioner is

    unjustified. In support of the contentions made insofar, learned

    counsel has relied upon the ratio encapsulated in 2024 SCC

    OnLine SC 1682: Subodh Kumar Singh Rathour V. Chief

    Executive Officer & Ors., and 2016 (11) SCC 720: Gangotri

    Enterprises V. Union of India and submitted that judicial review

    is permissible in tender matters, especially qua the issue of bank

    guarantee encashment.

    5. Per contra, learned counsel for the respondents has

    submitted that the assertions made in the writ petition are

    factually disputed. It is submitted that time was essence of the

    contract, as also affirmed by the learned counsel appearing for the

    petitioner, as the matter pertains to Railway department, and

    there was a delay on the part of the petitioner. It is further

    submitted that as per the terms of the agreement, there is a

    remedy before the Dispute Redressal Board i.e. qua conciliation

    and thereafter the arbitration clause could be invoked, thence, in a

    scenario where there are disputed questions of facts, judicial

    review ought not be made and the remedy as under Section 9 of

    the Arbitration and Conciliation Act may be adopted.

    6. In support of the said submissions, learned counsel has

    placed reliance upon the ratio enunciated in D.B. Civil Special

    Appeal (Writ) No.1245/2025 title MKC Infrastructure Ltd.

    Vs. Union of India and Ors. wherein whilst placing reliance upon

    Hon’ble Supreme Court in the case of Tata Motors Ltd. Vs.

    Brihan Mumbai Electric Supply and Transport Undertaking

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    (BEST): AIR 2023 SC 2717 and Midnapore Peoples’ Coop.

    Bank Ltd. and Ors. Vs. Chunilal Nanda and Ors.: (2006) 5

    SCC 399, the Court has opined that no interfere is to be made in

    the termination proceedings.

    7. Having heard the submissions made by learned counsel

    representing the parties, scanning the material available on

    record, and perusing the judgments cited at Bar, this Court is not

    inclined to interfere in the present writ petition for the following

    reasons:

    7.1 That disputed questions of facts are involved.

    7.2 That there is an alternate available remedy as the

    concerned agreement has an ‘arbitration clause’.

    7.3 That as per settled position of law, where there are

    disputed question of facts, appellate/writ courts should restrain to

    interfere. The said view is made unambiguous, yet again, in the

    ratio encapsulated in Tata Motors Limited (supra), the relevant

    extract from which is reproduced hereinbelow:

    “52. Ordinarily, a writ court should refrain itself
    from imposing its decision over the decision of the
    employer as to whether or not to accept the bid of
    a tenderer unless something very gross or palpable
    is pointed out. The court ordinarily should not
    interfere in matters relating to tender or
    contract. To set at naught the entire tender
    process at the stage when the contract is well
    underway, would not be in public interest.
    Initiating a fresh tender process at this stage
    may consume lot of time and also loss to the
    public exchequer to the tune of crores of
    rupees. The financial burden/implications on
    the public exchequer that the State may have
    to meet with if the Court directs issue of a
    fresh tender notice, should be one of the
    guiding factors that the Court should keep in
    mind. This is evident from a three-Judge Bench

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    decision of this Court in Association of Registration
    Plates v. Union of India and Others
    , reported in
    (2005) 1 SCC 679.”

    (Emphasis supplied)

    8. Accordingly, and in view of the ratio encapsulated in MKC

    Infrastructure Ltd. (supra), the present writ petition is

    dismissed. However, it is clarified that if the petitioner is desirous,

    to avail the remedy as specified by the respondents, he is free to

    choose the same. It is made clear that no prejudice be caused to

    the petitioner on account of dismissal of the present writ petition.

    (SAMEER JAIN),J

    DEEPAK /s-230

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