M/S Foodworld vs Indian Railway Catering & Tourism … on 2 June, 2016

2. In respect of Geetanjali Express, though Notice Inviting Tender (in
short ‘NIT’) was issued only for on-board catering service however, vide
addendum dated March 09, 2006 tender documents were issued for
provision of bedroll service as well. Foodworld vide their letter dated May
09, 2006 accepted the terms and conditions for providing on-board catering
services however, vide separate letter inquired about the payment for terms
of bedroll services. Terms of payment for bedroll were specified and
Foodworld was asked to start operation for both catering and bedroll w.e.f
June 15, 2006 when Foodworld requested for appointment for sub-licensee
M/s Aram Services to provide bedroll kit. On a permission being granted
for appointment of sub-licensee, Foodworld commenced on-board catering
services on July 01, 2006 and the bedroll services on October 06, 2006. Vide
letter dated July 24, 2007 Foodworld wrote for being relieved from
rendering bedroll services and vide the letter dated May 19, 2008 Foodworld
requested for being relieved from the licence w.e.f. July 01, 2008 as the
prices of raw material had increased. IRCTC vide its letter dated July 22,
2008 informed Foodworld that surrender of catering licence in breach of
condition of agreement would entail consequence and issued a show cause
notice as to why action be not taken for terminating the licence for
Geetanjali Express, forfeiture of security deposit and debarment in
participation in future project of IRCTC for a period of one year.
Foodworld consented to the imposition as proposed in the show cause
notice. On September 22, 2008, Foodworld reiterated that it was rendering
catering services on Minimum Licence Fee (in short ‘MLF’) and not licence

FAO(OS) Nos.291/2015 & 363/2015 Page 2 of 9
fee as per Bid. Thus payment of `8,93,250/- towards licence fee for the
period July 2008 to September 30, 2008 on the calculation of minimum
licence fee was made by Foodworld which cheque was encashed by IRCTC.
Vide their further letter dated October 13, 2009 IRCTC informed Foodworld
that their licence stood terminated w.e.f. February 15, 2009 and the security
deposit was forfeited. They were debarred from participating in future
projects of IRCTC for a period of one year and demanded balance on pro-
rata licence fee.

Source: Indian Kanoon

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