THE HON'BLE SRI JUSTICE M.GANGA RAO

Writ Petition No. 9885 of 2020

ORDER:

The petitioner, APSPDCL Electrical Welfare Association, filed this writ petition to issue a Writ of Mandamus declaring the Memo No.CGM/O&M/EE/Dy.EE/AEE/O&M COML/ F.E.No.216869/20 dated 30.05.2020 issued by the 2nd respondent for entrusting the works on nomination basis for manning and maintenance of 33/11 KV sub-stations, as illegal and arbitrary and consequently to declare that the respondents are not entitled to issue contracts on nomination basis and also to declare that the members of the association are entitled for receiving payments/administrative charges for the works executed upto the extended period of contract.

2. The case of the petitioner-association is that it was formed for looking after the welfare of all the electrical contractors who are working for APSPDCL and APCPDCL. The contractors are being engaged by the 1st respondent for operation and maintenance of 33/11 KV sub-stations which includes watching and manning works. Initially, the contract was given for one year. However, the said contract has been extended from time to time till 30th Mach, 2020. At the time of execution of contract, the respondent-authorities have agreed to pay administrative charges to the contractors @ 10% to 15% depending on place of work and the contract of

work executed. However, for the past one year, the respondents are insisting the contractors to submit their willingness for reducing the administrative charges from 10% - 15% to 5%. In spite of pressure exerted by the respondent authorities, the contractors have never given their consent for reducing their administrative charges. The respondent-Corporation due to pandemic situation (Corona Virus), the 2nd respondent – Chief General Manager (O&M), APCPDCL, Vijayawada issued proceedings vide Memo No. CGM/O&M/ EE/Dy.EE/AEE.C/F/E.No.21230/20 dated 21.04.2020 taking unilateral decision of reducing the administrative charges of the contractors to less than or equal to 5%. Since the 2nd respondent issued the said proceedings without prior consent from the contractors, they filed W.P.No.8500 of 2020. During pendency of the said writ petition, the 2nd respondent issued another Memo dated 30.05.2020 according permission to the Superintending Engineers, APSPDCL to enter into agreements on nomination basis for three months i.e., for the months of April, May and June, 2020 for operation and maintenance of 33/11 KV Sub-stations. But, the respondents much earlier to the issuance of the Memo dated 21.04.2020 reducing the administrative charges to 5% and the agreements of the existing contractors were extended upto 31.03.2021. The reduction of rate of administrative charges was given retrospective effect. The existing contractors are not willing to execute the work during the pandemic period

and for the reduced rate of administrative charges. It appears that they have given the work of operation and maintenance of 33/11 KV on nomination basis for the months of April and May to those who are willing to reduce the cost of operation and maintenance charges. It is an understanding to revert back to the original procedure of calling for tenders if the COVID situation subsides. The award of the work of operation and maintenance of 33/11 KV sub-stations on nomination basis was taken up to tide over the difficult situation during the COVID period, for which period the Corporations are not able to collect the consumption charges from the customers. However, the petitioner's association submitted representation on 02.03.2020 and 30.04.2020 ventilating their grievance including forcing of the existing contractors to accept for the reduced rate of operation and maintenance charges as per the Memo dated 21.04.2020. Being aggrieved by the Memo dated 30.05.2020, the petitioner's association filed the present writ petition.

3. The 2nd respondent filed counter stating that the work contract of operation and maintenance of 33/11 KV substations within the jurisdiction of the respondents' circles were entrusted to the contractors on tender basis for a period of one year allowing the administrative charges from 10% to 15% in APSPDCL and APCPDCL depending on the location of the work. Generally, all the contracts were going to be expired by 31.03.2020. Due to outbreak of Covid-19, the

respondent-Corporation is facing several problems in maintaining the 33/11 KV sub-stations and the Corporation is facing difficulty in entrusting the work to willing contractors by inviting tenders. In those circumstances, the existing contract was extended for a further period of one year upto 30.03.2021. As Corporation could not collect the bills for the month of March and April as per the directions of the Central and State Governments and fresh tenders cannot be invited during the Covid period, a decision was taken to reduce the administrative charges from 10% to 5% in APSPDCL and APCPDCL and as part of it, negotiations were held with the contractors and requested them to work @ 5% administrative charges for the month of April, May and June, 2020 towards operational maintenance of 33/11 KV substations for which the contractors have submitted their willingness for administrative charges less than or equal to 5%. The existing contractors came forward to work for 454 sub-stations @ 5% and agreements were also concluded and whereas in 256 sub-stations new contractors have come forward to work @ 5% administrative charges and the same was entrusted to the new contractors and agreements were also concluded for all 710 sub-stations amicably and thus issue was resolved. After closure of the lock down, the Corporation will invite the tenders in the month of July in a transparent manner by following open tender system. Hence, the grievance of the petitioner hypothetically is that the

respondents are continuing the entrustment of maintenance of operation of 33/11 KV sub-stations on nomination basis contrary to the existing guidelines. If any new contractors come forward ventilating their grievance, the same will be redressed as per the existing circular instructions duly taking into consideration the pandemic situation.

4. Sri Ravi Kondaveeti, learned counsel appearing for the petitioner, would submit that the 2nd respondent, without application of mind, issued the impugned proceedings authorizing the Superintending Engineers to enter into agreements for the works executed for the months of April, May and June, 2020 on nomination basis though the said work has already been executed by the contractors of petitioner's association and some others. As per the earlier tender rules in vogue, generally the manning and maintenance of sub-stations is given to each contractor limiting it to 5 sub-stations only in the whole operation circle. However, the respondents now are trying to issue contracts to their own interested candidates for more than five substations. Since the respondent-Corporation is a public undertaking company, any contract shall be through open tender process and not through nomination basis. The consent given by some contractors for accepting the administrative charges @ 5% was taken under coercion and not by free will.

5. Sri Y.Nagi Reddy, learned Standing Counsel appearing for the 2nd respondent, while reiterating the averments of the counter, has specifically stated that the existing contract whose term expired on 31.03.2020 was further extended for a period of one year i.e., 31.03.2021 and the contractors were asked to execute the maintenance and operation of 33/11 KV sub-stations for administrative charges less than or equal to 5% by issuing the impugned Memo dated 30.05.2020 by the 2nd respondent to supply electricity without any hindrance to the consumers during the pandemic period. However, on nomination basis, the work was entrusted to the contractors for a period of three months from April, May and June, 2021 only where the existing contractors are not agreed to execute the work as there is no option for the respondents to nominate and continue the maintenance and operation of 33/11 KV Sub-stations. Immediately, after subsiding the Covid situation, the respondents are under obligation to go for tender process as per the guidelines of the Corporation. The respondents are also held negotiations with the contractors for the reduced rate of administrative charges. Hence, the temporary arrangement action taken up by the respondents during the pandemic situation could not be said to be illegal, arbitrary and contrary to the guidelines issued through Circular instructions by the Corporation.

6. In the facts and circumstances of the case and considering the submissions of the learned counsel, and on

perusal of the record, this Court found that the period of contract of maintenance and operation of 33/11 KV substations in the respondents' circles were entrusted the contractors for a period of one year i.e., upto 31.03.2020 on payment of administrative charges @ 10% to 15% depending on the place of work they executed. It is to be understood that the contractors have to execute separate individual agreements with the respondent-Corporation agreeing to different rates of administrative charges ranging from 10% to 15%. The pandemic (Covid) has started during the month of March, 2020, the fag end of their contract period and it appears that the respondents are forced to extend the existing contractors to man the 33/11 KV sub-stations, the maintenance of which is essential for supply the uninterrupted power supply. Thereafter, due to reduced collection of electricity bills, the 2nd respondent has taken a decision and issued a Memo dated 21.04.2020 reducing the maintenance and operation costs for less than or equal to 5%. Thereafter, the 2nd respondent issued the impugned Memo dated 30.05.2020 according permission to the Superintending Engineer (Operation), Vijayawada to enter into an agreement on nomination basis for three months i.e., April, May & June, 2020 towards operation and maintenance of 33/11 KV substations. Wherever, the existing contractors agreed for the reduced rate of interest, they were extended and continued and wherever the existing contractors refused, the same was

entrusted on nomination basis to the contractors for those three months.

7. The existing contractors agreed to work for reduced rate of operation and maintenance charges numbering 454 Substations and new contractors numbering 256 have come forward to work @ 5% administrative charges, with an understating that the same could not be continued beyond Covid-19 pandemic situation. The work is entrusted to those who are willing to work and they are not forced or pressurized to execute the work. Later, the respondents have negotiated with the contractors and the existing contractors' time was expired on 31.03.2020 and the reduced rate of maintenance and operation of sub-stations was issued on 21.04.2020 and 24.04.2020 for different circles. The same cannot be said to be on operation with retrospective effect.

8. This Court found that all the impugned actions taken by the respondents during the period of pandemic situation, cannot be said to be illegal and arbitrary as argued by the learned counsel for the petitioner. Hence, the contention of Sri Ravi Kondaveeti, learned counsel appearing for the petitioners, that the extension of existing contract period from 01.04.2020 to 31.03.2021 by applying reduced rate of administrative charges and threatening the contractors to accept or agree for the reduced rate of maintenance and operation charges issued by Memo dated 30.05.2020, could

not be countenanced in the facts and circumstances of the case.

9. However, the respondents are under obligation to go for tender process for entrustment of work of operation and maintenance of 33/11 KV Sub-stations to select the contractors for the agreed rate of administrative charges. It is needless to state that the new contractors who are said to be the members of the petitioner's association could ventilate their individual grievances before the 2nd respondent or the authorities who entered into the contract agreements with the contractors. The individual grievances of the contractors shall be considered and redressed by the authorities concerned.

10. With the above observation, the Writ Petition is disposed of. No order as to costs.

11. Miscellaneous Petitions, if any, pending in this writ petition shall stand closed.

___________________________

JUSTICE M.GANGA RAO

12-11-2021 anr

THE HON'BLE SRI JUSTICE M.GANGA RAO

Writ Petition No. 9885 of 2020

12-11-2021

Anr