JUDGMENT
Thottathil B. Radhakrishnan, J.
1. The petitioner is a contractor, who had supplied goods to the first respondent Panchayat.
2. There is no dispute that the Stores Purchase Manual, issued by the Authority of the Government of Kerala, binds the Panchayat and regulates its activities, in so far as the purchases are concerned. Clause 52 of the Stores Purchase Manual provides that security may be taken in any of the nine forms enumerated therein, namely (i) Cash, (ii) Government Promissory Notes, Municipal Debentures or Port Trust Bonds, (iii) Stock Certificate of the Central or State Government/s (iv) National Savings Certificates, Government of India 12 years National Plan Savings Certificates and 10 year Treasury Savings Certificate, (v) Treasury Savings Bank Deposits, (vi) Post Office Savings Bank Deposits, (vii) Post Office Cash Certificates, (viii) Deposit receipts of recognized Banks and Co-operative Societies approved by Government for the purpose, and (ix) Bank guarantees from Scheduled Banks in India.
3. The controversy between the parties is as to whether the contractor is entitled to choose from the aforesaid nine types of securities, which he may offer or whether the Panchayat is entitled to insist the form in which it would take the security.
4. A reading of Clause 52 would show that different forms of securities are provided, so that a person entering into a supply contract with the Panchayat can choose any mode of security that he would offer. However, that would be one of the nine types enumerated in Clause 52. I say so, because, if it is left to the wisdom of the Panchayat to choose one among the forms of security to be accepted, it will lead to a situation where the person, who has sufficient provisions to make security in any of the forms enumerated, may be forced to provide security, which he does not have, as in this case, where the Panchayat insists that the remittance be in cash. This question can easily be answered by posing the question as to what would have happened, if the Panchayat were to decide that it will take security only in any of the other eight forms enumerated at Sl.Nos. (ii) to (viii) of Clause 52 of the Stores Purchase Manual. Can the party be compelled to make available the said securities, than provide securities to the Panchayat in satisfaction of the requirement? Adopting such an approach will defeat the very purpose of Clause 52. In my considered view, it is left to the wisdom of the supplier to choose from the nine types of securities as are provided in Clause 52 of the Stores Purchase Manual. Accordingly, the petitioner is entitled to provide Bank Guarantee, which he has already furnished and he cannot be compelled to remit cash towards security.
In the aforesaid circumstances, this Writ Petition is allowed and the respondents are directed to make payments covered by Ext.P3 after recording the security furnished by the petitioner in the form of Bank Guarantee, if it covers the amount insisted as security.