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TMI Blog2016 (3) TMI 1002X X X X Extracts X X X X X X X X Extracts X X X X ..... AKIL KURESHI AND MR. Z.K. SAIYED FOR THE PETITIONER : MR DIPEN DESAI, ADVOCATE FOR THE RESPONDENT : MR MAULIK G NANAVATI, ADVOCATE, NOTICE SERVED BY DS ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. The petitioner has prayed for a direction to the respondents to release an amount of security deposit of ₹ 39.85 lacs (round about) with interest. The litigation has checkered history. 2. Briefly stated facts are as under :- Petitioner is a proprietorship concern and is engaged in the business of exhibiting advertisements on billboards and kiosk at various places in the State of Gujarat. Vadodara Municipal Corporation had awarded a contract to the petitioner for exhibiting such advertisements on the electric poles within the Corporation limit of the city of Baroda. For awarding the contract at different rates the city was divided into four zones. For Zone No.1 the contract period was three years commencing from 27.10.2009. For Zone No.2 the contract period was three years commencing from 18.3.2010. For Zone No.3 the contract period was three years commencing from 17.10.2011 and for Zone No.4 the contract period was three years commencin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies, we are satisfied that in all these writ petitions, interim relief is required to be granted. Therefore, we are passing fresh orders of stay. The respondents are restrained from inviting fresh tenders till the next date of hearing and if any fresh tenders have been invited, no further action be taken on such tenders. 8. This order was clarified by the High Court by a further order dated 13.8.2013 that the stay against tenders for advertisements for zones No.1 and 2 does not survive. However, regarding fresh tenders for zones No.3 and 4 the Court deferred its decision for a later date. At that stage, it was conveyed by the counsel for the Corporation that the Corporation may consider withdrawing the order of termination so that contractor be continued enabling the Corporation to earn revenue. 9. When such legal battle was going on, it appears from the record that the parties tried to resolve the dispute more amicably. In April, 2013 the Municipal Commissioner, Vadodara, conveyed to the Standing Committee that multiple disputes concerning the contracts in question are pending before various courts. It was pointed out that the petitioner had filed Special Civil Applicatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e paid by us, we trust that you would refund the same to us. Our contracts for Zone 3 and Zone 4 have been terminated by the Corporation. Presently there is no stay of the court on the said termination orders. We would request you to kindly cancel the contract by mutual consent. We shall withdraw our petitions from the High Court challenging the termination orders. We also undertake to withdraw the petition challenging the new tender notice of 14.9.12 and get the stay order on award of contract to new party withdrawn from the Court. In return, we would request you to kindly drop the proceedings initiated by you for blacklisting us and oblige. Kindly convey your acceptance of our proposal. 11. This proposal was accepted by the Corporation and was so conveyed to the Court when the said petitions were taken up for further hearing on 23.8.2013. The Court therefore disposed of all the petitions in the following terms : Special Civil Application No.3737 of 2013 is pertaining to issuance of fresh tender notice. Special Civil Applications No.16742 of 2012, 16743 of 2012, and 16744 of 2012 pertain to termination of contract. Learned advocate Mr.Maulik G. Nanavati plac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r which was accepted by the Corporation two elements of charges are not accounted for. First is the escalation clause contained in the contract and second is with respect to service tax. The Corporation therefore contends before us that in addition to the charges that the petitioner agreed to pay to the Corporation for compromise, the petitioner must pay further rental charges on the basis of price escalation and service tax. According to the petitioner, the sum payable under the said offer letter dated 21.8.2013 which was accepted by the Corporation comes to ₹ 13,62,770/. According to the petitioner, therefore the Corporation should after adjusting such sum from the security deposit of ₹ 53,49,298/should refund the rest i.e. ₹ 39,85,528. When the Corporation refused to do so, this petition had to be filed. On the other hand, the Corporation computes the recoverable sum as per this formula added by the escalation and service tax charges which according to the Corporation comes to ₹ 38,18,827/. During the pendency of this petition the difference admitted by the Corporation of ₹ 14,67,471/was paid over to the petitioner and towards disputed amount the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 16.51 lacs every month. If the petitioner therefore withdraws all proceedings, the Corporation may consider dropping the blacklisting and releasing the security deposit after adjusting ₹ 14.06 lacs of unpaid rental dues. 16. The petitioner made a firm offer in writing on 21.8.2013 in which it was conveyed to the Corporation that he would pay at specified rates for specified zones for the number of electric poles for which the petitioner was allowed to exhibit the advertisements. It was this offer which the Corporation accepted. If the Corporation had any intention of applying escalation as per the original contract, the Corporation either had to reject the offer or make a counter offer which the petitioner would or would not have accepted. However, the Corporation having accepted the written offer of compromise made by the petitioner, now cannot read an escalation clause out side of such compromise formula. This is so because the petitioner had conveyed in black and white the rate at which the rental charges would be recoverable by the Corporation during the period specified in such offer letter. The offer of the petitioner was unambiguous. 17. Why did the C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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