The matter is listed in the ‘orders’ category, however, with the consent of the learned counsel for the parties, it is being heard and decided finally today itself.
The present writ petition has been filed for quashing of the notice dated 04.04.2014 (Annx.2), order dated 28.04.2014 (Annx.7), order dated 05.12.2016 (Annx.17) as well as the order dated 20.11.2018 (Annex.24).
The brief facts giving rise to the present writ petition are that the petitioner being a proprietorship firm was awarded a contract on 22.3.2013 for collection of excess royalty under the Rajasthan Minor Mineral Concession Rules, 1986. The period of contract was from 01.04.2013 to 31.03.2015. While the petitioner was working under the terms and conditions of the contract, a notice was received by the petitioner on 12.04.2014 wherein it was stated that one ACD case was registered against the petitioner and certain forged receipts have been found for the transportation of the minerals from the area under contract. In pursuance of the notice received, the petitioner appeared before the respondentdepartment and the respondent- Mining Engineer terminated the contract of the petitioner and forfeited the Earnest Money vide order dated 28.04.2014. Against the order dated 28.04.2014, the petitioner preferred an appeal before the Additional Director of Mines. On 15.05.2014, the Additional Director of Mines passed a reasoned and detailed interim order whereby the order dated 28.04.2014 was stayed. After the order dated 15.05.2014 was passed by the Appellate Authority, the petitioner completed the contract period and deposited the amount due to the respondents as per the agreement entered into between the petitioner and the respondent. In addition to the amount due under the agreement, the petitioner also deposited penalty amount of Rs. 50,22,635/- in furtherance of the interim order passed on 15.05.2014. The appeal preferred by the petitioner was ultimately rejected vide order dated 5.12.2016 well after the contract period was over. Thereafter, the petitioner preferred a second appeal against the order dated 05.12.2016 before the Secretary, Mines & Geology Department and the same was also rejected vide order dated 20.11.2018.
Learned counsel for the petitioner submits that the basis on which, the entire proceedings were undertaken against the petitioner does not survive as the ACD has filed a negative Final Report against the petitioner which was accepted by the learned competent Criminal Court vide order dated 07.10.2017 (Annex.- 5) and in view of the filing of negative Final Report, the petitioner cannot be fastened with the liability of forfeiting the earnest money. He further submits that the petitioner has complied with the interim directions issued by the Additional Director, Mines vide its order dated 15.05.2014 and deposited the penalty amount to the tune of Rs. 50,22,635/-. He further submits that in view of the detailed findings recorded by the first Appellate Authority (ADM), the petitioner completed the contract period in pursuance of the contract agreement entered into between the petitioner and respondent and deposited the entire amount due to the Government. Learned counsel further submits that since the entire amount due to the Government including the penalty amount imposed by the interim order dated 15.05.2014 was deposited and the terms of the contract have been complied with by the petitioner, therefore, the forfeiture of the Security Deposit, Earnest Money and the amount towards Performance Bank Guarantee is illegal, arbitrary and unreasonable. He therefore, submits that this writ petition may be allowed and the respondents may be directed to release the amount of Security Deposit, Earnest Money and the Performance Bank Guarantee.
Per contra, learned counsel for the respondents submits that the proceedings undertaken by the department are completely justified as the forged receipts during the currency of the contract period were recovered and the petitioner was answerable for the same. Learned counsel therefore, submits that the forfeiture of Security Deposit, Earnest Money and the amount towards Performance Bank Guarantee is perfectly justified. Learned counsel for the respondents is not in a position to dispute the fact of filing the negative Final Report in the ACD case.
I have considered the submissions made at the bar and have gone through the entire pleadings placed on record.
The admitted facts in the case are that a show cause notice was issued by the department for recovery of certain forged receipts and on account of which, ACD case was registered against the petitioner. In the investigation, the ACD did not find the allegation sustainable against the petitioner and, therefore, a negative Final Report was filed which was accepted by the learned competent Court vide order dated 07.10.2017. The fact that the order passed by the Mining Engineer on 28.04.2014 for termination of the contract period was stayed by the Appellate Authority (ADM) on 15.05.2014 by a reasoned and detailed order. In pursuance of the interim order passed by the Appellate Authority (ADM), the petitioner had also deposited the penalty amount to the tune of Rs. 50,22,635/- and completed the contract period of two years by depositing the entire dues of the Government as per the contractual agreement entered into between the petitioner and the Government.
This court finds that since the basis on which the petitioner was proceeded was not found sustainable as the negative Final Report has been filed and the Appellate Authority after having dealt with the issue in detail imposed the penalty of Rs. 50,22,635/- which was deposited by the petitioner and, therefore, the action of the respondents in forfeiting the amount towards Security Deposit, Performance Bank Guarantee and Earnest Money is arbitrary and unreasonable. It is noted that even if, certain forged receipts were found during the contract period, it cannot be said with certainty that same was done by or on behalf of the petitioner and petitioner cannot be made liable for the same. It is also noted that even if certain receipts were found to be forged during the contract period of the petitioner, the Appellate Authority has penalized the petitioner for the same by imposing a penalty amount of Rs. 50,22,635/-. It is also noted that in pursuance of the interim order passed by first Appellate Authority, the contract period has also been completed by the petitioner and the entire amount due was also deposited. Thus, the forfeiture of Security Deposit, Performance Bank Guarantee and Earnest Money appears to be unjust & harsh.
The contention of the petitioner that the amount of penalty deposited by the petitioner in furtherance of the order dated 15.05.2014 passed by the Appellate Authority (ADM) should be refunded is noted to be rejected as the petitioner has taken the benefit of the said order by completing the contract. This Court finds that deposition of the amount of Rs.50,22,635/- towards t
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he penalty in pursuance of the order dated 15.05.2014 will balance the equity in this case and therefore, that amount is not required to be refunded to the petitioner. In view of the discussions made above, the writ petition is allowed. The impugned orders dated 04.04.2014 (Annx.2), 28.04.2014 (Annx.7), 05.12.2016 (Annx.17) as well as the order dated 20.11.2018 (Annex.24) are quashed and set aside. The respondents are directed to release the amount towards Security Deposit, Performance Bank Guarantee and Earnest Money. The (6 of 6) [CW-2384/2019] amount should be refunded to the petitioner within a period of three months from the date of receipt of a certified copy of this order. The stay application and all other pending applications, shall stand disposed of.