M/S Raghunath Goyal Contractor And Another vs. State Of Punjab And Others

Facts

The petitioner, M/s Raghunath Goyal Contractor, was awarded a tender for the operation and maintenance of a bus terminal. The contract, effective from 20.09.2023 to 19.09.2028, required the petitioner to deposit an annual contract fee of Rs. 1,28,23,076/- plus GST. The petitioner is challenging communications dated 19.02.2024 and 27.03.2024, issued by the respondents. These communications stated that the expression "advertisement" in clause 2(a) of the contract was a typographical error and that the petitioner could not erect advertisement boards or hoardings. The respondents demanded the removal of existing display boards/advertisements, threatening action under clauses 4.11 and 11.6 of the contract.

Held

The Court noted the concession by the respondents that the expression "advertisement" was indeed part of the scope of work under clause 2(a) of the RFP. However, the respondents argued it was an accidental error, as it was not listed as a revenue stream in clause 3 and that municipal laws restricted hoardings. The petitioner countered that the exclusion from clause 3 was the error and that depriving them of advertisement rights would upset the financial basis of their bid. Given the parties' statements, the Court disposed of the petition. The respondents agreed to invoke the dispute resolution mechanism under clauses 20.1 and 20.2 of the RFP to amicably resolve the differences. Pending a formal decision under these clauses, the authorities committed to maintaining the status quo regarding display boards and advertisement hoardings, and to restore any removed advertisements. The Court explicitly stated that this order does not express any opinion on the merits of the case, leaving the competent authority to examine the petitioner's grievances strictly in accordance with law.

Key Issues

1. Whether the inclusion of "advertisement" in clause 2(a) of the Request for Proposal (RFP) as part of the scope of work, alongside "Collection of Adda Fees from buses, rentals from commercial leases, advertisements and parking of private vehicles," grants the petitioner the right to erect advertisement boards and hoardings at the bus terminal, despite clause 3 of the RFP specifying separate tenders for multimedia advertisements and not listing "advertisement" as a revenue stream. Petitioner's arguments: The petitioner contends that "advertisement" was explicitly included in the scope of work under clause 2(a) of the RFP. They argue that while separate tenders were floated for multimedia advertisements, this did not exclude their right to erect print media advertisement boards and hoardings, which was part of their contract. They assert that the exclusion of "advertisement" from clause 3 (revenue streams) was an accidental omission by the respondents and that depriving them of these rights violates the contract and vitiates the financial equation upon which their bid was based. Respondents' arguments: The respondents concede that "advertisement" was mentioned in clause 2(a) of the RFP but claim it was an accidental error or omission. They argue that clause 3, detailing revenue streams, only listed "Income from Adda Fees (Terminal Toll)," "Annual lease of parking areas," and "Revenue from the lease of shops/kiosks at the bus terminal," and did not include advertisement revenue. They state that while advertisement was a revenue stream in previous years, it was consciously narrowed in the current tender due to municipal law restrictions on hoardings, but the expression was mistakenly retained in clause 2(a). They propose invoking clause 20.1 and 20.2 of the RFP for dispute resolution.