Rejecting the contention of the petitioners this Court held that
when the petitioners did not raise any protest when the date was extended and
participated in the tender process and even in the first representation made by them
did not even whisper about their objection regarding the extension of time of the
tender in question. The view so taken by this Court squarely apply to the facts of
the present case also. As has been elaborately discussed by us here before the
petitioners participated in the tender process without raising any objection regarding
scaling down the period of contract, splitting of the said contract and inclusion of
clause(b) in the said contract. Petitioners were therefore estopped from raising
such objections at the belated stage.
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH, NAGPUR
Messrs B. Himmatlal Agrawal,
Vs
The Maharashtra State Power
Generation Co. Ltd.,
WRIT PETITION No.6096/2013
CORAM : B.P. DHARMADHIKARI & P.R. BORA, JJ.
DATE OF PRONOUNCING JUDGMENT : 7.04.2014.
JUDGMENT (Per P.R. Bora, J.)
Citation;AIR 2014 Bom 108
The petitioners are the Contractors and stated to be working with
1]
respondent no.1 since last couple of years. Petitioner no.1 has been carrying out
the contract of cleaning and allied works in coal handling plant, CHPII cold plant at
KTPS, Koradi up to the year 20122013. Petitioner no.1 was allotted the work of
cleaning and allied works at KTPS, Koradi. Petitioner no.2 is carrying out similar
works at Koradi and Khaparkheda Thermal Power Stations. Petitioner no. 2 is said
to have successfully executed the contract of cleaning and allied works for the year
20102011 at Khaparkheda Thermal Power Station. He is also stated to be
carrying out contract with Khaparkheda Thermal Power Station for house keeping
and allied works including maintenance of auxiliaries and is also said to have
carried out fabrication works.
2]
A tender notice was published by respondent no.1 having tender Code
No. 35946 for “Six Monthly Contract for Cleaning and Allied Works including Round
The Clock Monitoring & Servicing of Conveyor Belt in CHP StageII” at Koradi
Thermal Power Station. Estimated cost of the said work was Rs. 1,63,20,500/.
Tender notice was published on 16th October 2013. Tenders were to be submitted
by 29.10.2013. Both the petitioners submitted their tenders within time stipulated in
the said tender notice. Two bids were to be submitted; first was Techno
ig
Commercial Bid and another was PriceBid. TechnoCommercial Bid was opened
on 29.10.2003 whereas Pricebid was opened on 02.11.2003. The tenders
submitted by the petitioners were rejected at the stage of TechnoCommercial Bid
itself since according to respondent no.1 they were not satisfying eligibility criteria
as laid down in the tender documents. The subjectcontract was allotted to
respondents 2 to 6. The action of respondent no.1 of rejecting tenders of
petitioners and awarding the same to respondents 2 to 6 is under challenge in the
present petition.
3]
It is the contention of the petitioners that their tenders were rejected
illegally and arbitrarily to unduly favouring respondents 2 to 6 though they were not
satisfying the eligibility conditions prescribed in the tender documents. The
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petitioners have further alleged that the tender notice was designed to favour and
enable respondents 2 to 6, who were the only persons other than the petitioners
who had offered bids. It is further alleged that though all previous contracts for
similar nature of work were ordinarily used to be annual contracts and used to be
allotted on the experience of work and value of the work executed by the concerned
contractor, the period of subjecttender was scaled down to six months precisely to
ig
accommodate respondents nos. 2 to 6. It is further alleged that in the qualifying
requirements prescribed for the subjecttender Clause (b) was intentionally added
so as to oust the petitioners from competing said tender. Clause (b) says that `the
Tenderer should have adequate experience in mechanical maintenance, fabrication
etc work, round the clock monitoring and servicing of auxiliaries and conveyors in
CHP of various power stations of MSPGCL/NTPC/Other Thermal Power Stations'.
4]
The petitioners have further alleged that splitting of the said contract in
five parts was also with an intention to favour respondents 2 to 6. According to
the petitioners, respondents 7 and 8 manipulated the terms of the contract to keep
the same within their jurisdiction; firstly by scaling down the time and secondly by
splitting it into five parts or else the value of the contract would have exceeded
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requiring the approval from the Head Office. It is the further contention of the
petitioners that none of the respondents 2 to 6 has any experience of carrying out
similar nature of work nor they are satisfying other qualifying requirements. It is the
contention of the petitioners that respondent no.1 being public body was required to
act in a just, fair and transparent manner and its action should be free from vice of
ig
arbitrariness and in conformity with Article 14 of the Constitution.
The petitioners have, therefore, prayed for setting aside the entire
5]
process of the tender having code no.35946 and further to set aside the order of
rejection of tender to petitioners 1 and 2. The direction is also sought against
respondents 1, 7 and 8 to reissue the tender by scrapping the work orders issued
to respondents 2 to 6.
6]
Though interim relief was also sought by the petitioners for directing the
respondents 2 to 6 to stop work during the pendency of the petition, it did not find
favour by this Court.
7]
All the respondents have submitted their reply affidavits. Respondents
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1, 7 and 8 have justified the act of awarding subjectcontract to respondent nos. 2
to 6. They have denied the allegations of mala fide and favoritism. According to
these respondents, action initiated by the petitioners and the allegations raised by
them in the present writ petition are afterthought. The respondents have submitted
that both the petitioners participated in the tender process without raising any of the
objections, which have been raised by them in the present petition. It is further
ig
contended that only after rejection of their tenders, they have levelled such
allegations. According to these respondents, no illegality has been committed by
8]
them in awarding contracts to respondents 2 to 6.
Respondents 2 to 6 have submitted in their respective reply affidavits
that they are quite eligible for award of the subjectcontract and each of them has
satisfied the eligibility criteria laid down in the tender document of the subject
tender. In support of their contentions the respondents have placed on record
several documents.
9]
Shri Samarth, learned counsel appearing for the petitioners first took us
through the documents, more particularly, the work orders in favour of the
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petitioners of the earlier works awarded and successfully carried out by them.
Through the said documents, learned counsel attempted to bring to our notice that
all these earlier contracts were annual contracts and further that they were not
containing any such qualifying requirement that `the tenderer should have adequate
experience in mechanical maintenance, fabrication work etc. The value of the
contracts earlier allotted in favour of the petitioners and the fact that earlier there
ig
was no splitting of contracts was also brought to our notice. The learned counsel,
taking us through tender documents of earlier contracts and current contract
showed the variations in these two contracts and submitted that all these variations
i.e. to scale down the period of contract, to split the same into five parts and to
include the clause of experience in mechanical maintenance, were done with an
ulterior motive of making undue favour to respondents 2 to 6 and to oust the
petitioners from competition.
10]
The learned counsel brought to our notice that on 02.11.2013 itself a
letter was submitted to respondent no.1 clarifying that petitioner no.1 was having
experience of mechanical and fabrication work and a certificate was also submitted
showing that the work done by petitioner no.1 was including fabrication work. The
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learned counsel brought to our notice the work done certificate dated 23.05.2013
issued by respondent no.1 in favour of petitioner no.1. He also invited our attention
to the work order dated 31.01.2007 in respect of construction of store shed so as to
bring to our notice that the fabrication was the part of the said work. The learned
counsel submitted that though the required documents were submitted within
stipulated time, they were intentionally ignored by respondent no.1 and the
11]
ig
petitioners were wrongly held to be not eligible for award of such contract.
The learned counsel further attracted our attention to the Pursis filed on
behalf of the petitioners on 27.2.2014 and the tender documents annexed to the
said pursis. The petitioners have annexed tender details of the tender having Code
No. 38433. It is an annual contract for `collecting Loading transporting and stacking
of spilled coal in CHP'. The learned counsel submitted that the aforesaid tender
supports the contention of the petitioners that issuance of `annual contract' was a
normal and established practice.
The learned counsel thereafter took us through the documents filed by
respondents 1 to 6 and referring to the contents of those documents submitted that
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said documents were not sufficient to qualify them to bid the tender. The learned
counsel brought to our notice that respondent no.2 has annexed the documents of
the present tender along with his reply to show that he is qualified for getting the
said contract whereas condition was to place on record the previous experience of
the similar nature of work. Referring to the work order dated 20.01.2012 issued in
favour of respondent no.3, the learned counsel submitted that the work done by
ig
respondent no.3 vide said work order was not similar to the work to be carried out
by subject tender. The learned counsel referring to the documents filed by
respondent nos.4, 5 and 6 attempted to bring to our notice that documents filed by
these respondents to show that they have carried out similar types of work, in fact,
do not demonstrate the said fact and, therefore, none of them was qualified for
award of the subject contract. The learned counsel further submitted that insofar as
the criteria of `value of work done in the past' is concerned, respondents 2 to 6
cannot be said to be fulfilling the said criteria also.
In support of his contentions, the learned counsel relied upon the
judgment of the Apex Court in the matter of Ramana Dayaram Shetty Vs. The
International Airport Authority of India and others reported in AIR 1979 S.C.
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1628 wherein it is held that : “the qualifications laid down in any tender as requisite
are to be scrupulously fulfilled by the tenderer and who do not fulfill the requisite
qualification cannot be awarded the said contract”. The learned counsel submitted
that since respondents 2 to 6 are not fulfilling the requisite qualifications, the award
Advocate Saboo, the learned counsel appearing for respondent nos. 2
ig
12]
of tenders in their favour is illegal.
to 6, took us through the qualifying requirements for award of the subject tender.
The learned counsel, referring to the documents filed on record by respondents 2
to 6 tried to convince us that all these respondents are fulfilling the eligibility criteria
and allegations raised by the petitioners that none of them is qualified are baseless.
We will be referring the documents so placed on record at the appropriate stage.
Sum and substance of his argument was that the award of contract to respondents
2 to 6 was perfectly valid and legal. The learned counsel filed on record the
information consolidated in tabular from pertaining to respondents 2 to 6 to
demonstrate that they were fulfilling all the requirements to be considered for award
of subject contract. The learned counsel placed his reliance on the judgment of
Hon'ble Apex court in the case of Tata Cellular V/s. Union of India reported at
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13]
(1994) 6 SCC 651.
Mr. Mohagaonkar, learned counsel appearing for the respondents 1, 7
and 8 made elaborate submissions to answer the objections raised by the
petitioners in respect of the award of contract to respondents 2 to 6. The learned
counsel submitted that to divide the contract into five parts and to scale down its
ig
period to six months was a policy decision taken by the officers of respondent no.1
after due deliberations. The learned counsel brought to our notice that issuance of
six monthly contract was not a new thing and in the past on several such
occasions six monthly contracts were awarded.
The learned counsel further submitted that the petitioners were not
14]
having experience of mechanical maintenance due to which on several occasions
obstructions were caused in the work being done by the petitioners some times
leading to stoppage of work or delay in the performance. The learned counsel
submitted that therefore, a policy decision was taken to include the minor
mechanical works in the tender as has been mentioned in the scope of work of
PartII which includes round the clock monitoring and servicing of conveyor system.
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The learned counsel then submitted that the work of CHP Stage II old
15]
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plant has been divided into three parts and work of augmentation plant in two
parts only with the object to increase efficiency of the work. The learned counsel
then took us through the documents pertaining to the eligibility of respondents 2 to
6, filed on record by respondent no.1 as well as said respondents. The learned
counsel then brought to our notice the minutes of the meeting held on 8.10.2013 of
ig
the State level CHP Improvement Committee wherein a decision was taken that
cleaning contract should be modified such as minor chute patching, skirt adjustment
and conveyor belt alignment including for proper cleaning. The learned counsel
further submitted that to require the tenderers to submit the documents of annual
turn over, profit and loss account etc. pertaining to preceding five years is a regular
practice. The learned counsel submitted that all the documents submitted by
respondents 2 to 6 were thoroughly scrutinized by the officers of respondent no.1
and only thereafter they were held to be qualified for award of the contract. The
learned counsel submitted that since the petitioners did not submit any document
showing that they were having experience of mechanical maintenance their
technical bid was rejected.
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The learned counsel then submitted that the submissions made by the
16]
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petitioners in the additional affidavit and documents filed by them showing that
written objection was raised by them before opening of price bid and further that
they have submitted the necessary information on 2.11.2013 itself evidencing that
they were having sufficient experience of doing mechanical maintenance work, are
shrouded with doubts. The learned counsel brought to our notice that the
ig
documents allegedly submitted by the petitioners on 2.11.2013 were, in fact,
received in the office of respondent no.1 on 6.11.2013. The learned counsel
submitted that one Mr. Chati, who is said to have accepted the letter at 3.30 p.m. on
2.11.2013 was in fact not in the office in the second half on that day. The learned
counsel submitted that the petitioners have made a foul attempt to bring on record
that before opening of price bid they have submitted the necessary information as
about their eligibility to carry out mechanical maintenance. To substantiate the
points urged by him in his arguments, Shri Mohgaonkar has relied upon as many as
ten judgments. We will be referring to those judgments at the appropriate stage.
17]
The learned counsel relied on the following judgments in support of the
contentions raised by him during the course of his argument:
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Directorate of Education and others Vs. Educomp
Datamatics Ltd. and others : (2004) 4 SCC 19.
Michigan Rubber (India) Ltd. Vs. State of
(ii)
(i)
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Karnataka and others : (2012) 8 SCC 216.
(iii)
M/s. G.J. Fernandez Vs. State of Karnataka and
others : AIR 1990 S.C. 958.
(iv)
Tata Cellular Vs. Union of India : (1994) 6 SCC
Global Energy Ltd. and another Vs.Adani Exports
ig
(v)
651.
Ltd. And others : (2005) 4 SCC 435.
Jagdish Mandal Vs. State of Orissa and others :
(vi)
(2007) 14 SCC 517.
Meerut Development Authority Vs. Association of
(vii)
Management Studies : (2009) 6 SCC 171.
(viii)
Bee Jay Contractors, New Delhi Vs. Hindustan
Petroleum Corpn. Ltd. Mumbai : 2010 (6) Mh.L.J. 392.
(ix)
Tejas Constructions and Infrastructure Pvt. Ltd.
Vs. Municipal Council, Sendhwa and another : (2012) 6 SCC
464
(x)
Haast Precision Pvt. Ltd. Vs. State of Goa
(judgment passed in WP No. 774 of 2013) in the High Court of
Bombay at Goa.
18]
From the averments made in the petition, the documents filed on record
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and the points urged in the argument, it is transpired that the act of respondents
Nos.1, 7 and 8 in rejecting the tender of the petitioners and awarding the same to
respondents 2 to 6 is questioned by the petitioners mainly on the following
grounds:
(i)
That the period of subject tender was intentionally
That the subject contract was split into five parts
(ii)
ig
annual contract.
scaled down to six months when usual practice was to award
so as to bring down value of the contract of each part with the
motive that in such case approval of Head Office may not be
required and also for the advantage of respondent nos.2 to 6.
(iii)
That in qualifying requirements, clause (b)
requiring that `tenderer should have adequate experience in
mechanical maintenance, fabrication etc., work, round the
clock monitoring and servicing of conveyor belt in CHP Stage
II of various power stations' was intentionally incorporated with
oblique motive of ousting the petitioners from competing the
subject tender.
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That the documents furnished by the petitioners
(iv)
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well within time to evince that they have sufficient experience
to do mechanical maintenance, were ignored and their
technical bid was wrongly rejected.
(v)
That none of the respondents 2 to 6 was satisfying
the eligibility criteria as set out in the tender documents and in
awarded to them.
ig
spite of that, the contracts were illegally and arbitrarily
19] Insofar as the first objection is concerned, the learned counsel for the
petitioners showed us tender documents and work orders pertaining to some old
contracts filed on record by him. He showed us tender documents pertaining to
Tender Code Nos.26528, 32457, 52390 and few others. It is true that all these
tenders were in respect of the cleaning and allied works in coal handling plants and
were annual contracts. As stated earlier, it is the case of the petitioners that
issuance of annual contract was the usual and established practice which was
deviated only to favour respondents 2 to 6.
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20] Opposing the submissions so advanced on behalf of the petitioners, Mr.
Saboo, learned counsel for respondents 2 to 6 and Mr. Mohagaonkar, learned
counsel appearing for the respondents 1, 7 and 8 brought to our notice the
documents filed on record by them relating to some other tenders. The learned
counsel showed us the work orders pertaining to three etenders bearing eT Nos.
2264, 7690 and 4174. It is noticed that all these contracts were also pertaining to
ig
complete maintenance and cleaning of stacker reclaimer along with conveyor but
were six monthly contracts. It was brought to our notice by Mr. Mohagaonkar that
the notices of eT 14611 (20112012), eT5458 (20102011) and eT 76 (20092010)
which were earlier published for one year were revised for the period of 120 days.
The leaned counsel also invited our attention to the documents pertaining to tender
eT 33473 for the year 20132014 which shows its duration as 120 days.
21] From the documents showed to us by the respective counsel for the
parties, it is clearly revealed that when some contracts were annual others were for
the period of six months and some were for the period of even four months. Thus,
there appears no substance in the objection raised by the petitioners that issuance
of annual contract was the only prevailing practice and it was deviated while issuing
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the contract in question. Secondly, nothing has been brought to our notice by the
petitioners as to what prejudice has been caused to them because of scaling down
the period of contract. The petitioners have also not brought to our notice any
convincing material to substantiate their allegation that the period of subject
contract was scaled down to six months with the only object of making favour to
The second objection is that the subject contract was divided into five
22]
ig
respondents 2 to 6. This objection is, therefore, rejected.
parts to bring down the value of each part of the contract. According to the
petitioners, this sub division was intentionally made by the respondents 1, 7 and 8
so that the entire process of the contract can be completed at their level itself and
the approval from the Head Office may not be required. The respondents have
denied such allegation in their respective written submissions. Mr. Mohagaonkar,
learned counsel for respondents 1, 7 and 8 submitted that the decision to divide
contract into five parts was a policy decision taken by the officers of respondent
no.1 after due deliberations. He submitted that such decision was taken for
improving quality of work.
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23] In their written submission respondents 1, 7 and 8 have specifically
pleaded that in the execution of past contracts of similar nature the single agency
was found not capable to handle the cleaning of vast area/zone and had sometimes
failed to control the situation. It has also been contended that this issue was
discussed in the meeting of State Level CHP Improvement Committee held on
08.10.2013 at Mumbai and in pursuance of the decision taken in the said meeting
ig
the contract in question was subdivided in five parts for achieving better
performance. Minutes of the said meeting are bought to our notice which support
the submissions made by the respondents. In this regard also no material has been
placed on record by the petitioners to show what prejudice has been caused to
them because of splitting of the contract in five parts. Nothing has also been shown
to us so as to disbelieve or to doubt the justification given by respondents 1, 7, and
8 for subdividing the work into five parts. We do not see any mala fides and/or
illegality in the justification given by respondents 1, 7 and 8 for subdividing the
work of the subject contract into five parts.
24]
The third objection of the petitioner is that clause(b) has been
intentionally included in qualifying requirements of the subject tender in order to see
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that the petitioners are ousted from the competition. Clause(b) prescribes that
“tenderer should have adequate experience in mechanical maintenance, fabrication
etc. work, round the clock monitoring and servicing of auxiliaries and conveyors in
CHP of various power stations of MSPGCL/NTPC/OTHER TPC”. In paragraph 9 of
the petition, the petitioners have stated that the tender notice was designed
specifically by putting clause (b) in order to see that the petitioners are ousted from
ig
the competition. The petitioners have further stated that in the earlier contracts
executed by them, the mechanical maintenance part was consisting only 5% of the
contract. According to the petitioners, there was therefore no need to include
clause (b).
Regarding the plea so raised by the petitioners, respondents 1, 7 and
25]
8 in their reply have come out with the specific contention that the work orders
issued earlier to the petitioners did not include minor mechanical maintenance. It is
further averred that minor mechanical maintenance on several occasions caused
obstruction in the work being executed by the petitioner leading to stoppage or
delay in performance and therefore a policy decision was taken to include minor
mechanical works in the scope of work which include round the clock monitoring
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26]
and more ten items.
It was asserted by Mr. Samarth, learned counsel for the petitioners,
that the petitioners were having sufficient experience of carrying out mechanical
maintenance though there may not be a specific clause in that regard in the earlier
tenders. The learned counsel submitted that from the nomenclature of the contract
ig
as `contract for cleaning and allied works' it is clear that it includes the work of
minor mechanical maintenance as well as the work of fabrication.
27] The counsel for respondents have strongly opposed the submissions so
made on behalf of the petitioners. Mr. Mohagaonkar, learned counsel appearing for
respondents 1, 7 and 8 submitted that the term “allied works” in the earlier
contracts has to be understood in reference to the scope of work as provided in the
tender documents of the said contracts. The learned counsel took us through the
documents pertaining to earlier Et 26528 submitted by the petitioners themselves
and brought to our notice the scope of work as described in the said tender which
consists of eight items noted below:
(i)
Cleaning of conventional system;
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Lifting & Transportation of Spillage coal.
(iii) Cleaning of Idler Pulleys.
(iv) Removal of Foreign Material.
(v) Removal of Choke up.
(vi) Cleaning of Rail Tracks.
(vii) Removal of Honeycomb.
(viii) Cleaning
Junction
Towers/Crusher
of
(ii)
23
Mr. Mohagaonkar, the learned counsel for respondents 1, 7 and 8 took
28]
ig
House/Impactor Crusher House.
us through details of each of the aforesaid work and submitted that none of the
above items involve any mechanical work or mechanical maintenance. Mr.
Mohagaonkar then brought to our notice the added additional work in the subject
tender. The additional work is described at page no.29 of the tender documents
which consists of total 42 pages. The additional work consists round the clock
monitoring and servicing of conveyor system before crusher area. Total 10 items
are provided to be carried out by the tenderer in execution of the subject contract.
These items are as follows:
(i) Checking and Replacement of Roller Frames.
(ii) Checking and Adjustment/Replacement of Skirt Rubbers
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and its Brackets.
(iii) Checking and Replacement of Deck Plates, Sealing
Plates.
(iv) Checking and greasing of Gear coupling. Checking of
flexible pin bush coupling, replacement of pin and bushes on
as and when required.
(v) Checking of Gear Box, Fluid Coupling Oil Level and oil top
us if necessary.
ig
(vi) Checking of Conveyor Pulleys and its bearings, Greasing
of bearings, Replacement of Bearings in case of failure.
(vii) Checking and adjustment/replacement of scrappers.
(viii) Removal of conveyor running out.
(ix) Attending of chute leakage.
(x) All other associated mechanical work necessary but not
covered above.
29]
The learned counsel submitted that in view of the additional work so
included in the tender the respondents were required to incorporate a specific
clause requiring tenderer to have adequate experience in mechanical maintenance
and round the clock monitoring and servicing of conveyor belt. In this regard also,
learned counsel referred to the meeting of State Level CHP Improvement
Committee held on 08.10.2013 in which a specific decision was taken that cleaning
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contract should be modified and the works such as minor chute patching, skirt
adjustment and conveyor belt alignment be included therein. We have gone through
minutes of the meeting so placed on record by the respondents.
30]
The objections raised by the petitioners, which we have discussed
hereinabove, undisputedly relate to the terms of the subject contract. The question,
ig
therefore, arises as to what extent they are open for judicial scrutiny. In the case of
Directorate of Education and others V/s. Educomp Datamatics Ltd and others
reported at (2004) 4 SCC 19, relied upon by Shri Mohgaonkar, the Directorate of
Education had taken a decision to establish computer labs in the national capital
territory in all Government schools by the year 2003 in collaboration with private
sectors. In the first phase 115 schools were taken up for imparting computer
education and the tenders were, therefore, called from the firms having turnover of
Rs.2 Crore. The total contract was for a sum of Rs.14.62 Crores. In the
subsequent year, again the tender was flouted for second phase. Thereafter when
the final phase of programme was worked out the tenders were called for of 748
schools. The costs of project had reached to approximately Rs.100 Crore.
Because of the difficulties faced in the earlier years Government took a policy
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decision to deal with one company having financial capacity to take up such project
and accordingly the Government took a decision to invite tenders from the firms
having a turnover of not less than Rs.20 Crores per annum for the last three
financial years. Aggrieved by the term of clause inviting the tenders from the firms
having annual turnover of Rs.20 Crores or more, writ petitions came to be filed
before the Delhi High Court. Delhi High Court allowed the writ petitions and
ig
observed that the term was arbitrary and the impugned condition had been
incorporated solely with an intention to deprive large number of companies
imparting computer education from bidding and to monopolies some big
companies. Matter was then taken to the Apex Court and while setting aside the
order passed by the High Court of Delhi the Hon'ble Apex Court held that :
“..... It was for the authority to set the terms of the tender.
The courts would not interfere with the terms of the tender
notice unless it was shown to be either arbitrary or
discriminatory or actuated by malice. While exercising the
power of judicial review of the terms of the tender notice the
court cannot say that the terms of the earlier tender notice
would serve the purpose sought to be achieved better than
the terms of tender notice under consideration and order
change in them, unless it is of the opinion that the terms were
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either arbitrary or discriminatory or actuated by malice. The
provision of the terms inviting tenders from firms having a
turnover of more than Rs20 crores has not been shown to be
either arbitrary or discriminatory or actuated by malice. This
apart SSI having a turnover of more than Rs 20 crores was
the lowest bidder.
The terms of the invitation to tender are not open
to judicial scrutiny, the same being in the realm of contract.
ig
The Government must have a free hand in setting the terms of
the tender. It must have reasonable play in its joints as a
necessary concomitant for an administrative body in an
administrative sphere. The courts can scrutinize the award of
the contracts by the Government or its agencies in exercise of
their powers of judicial review to prevent arbitrariness or
favouritism. It is entitled to pragmatic adjustments which may
cannot strike down the terms of the tender prescribed by the
Government because it feels that some other terms in the
tender would have been fair, wiser or logical.”
be called for by the particular circumstances. The courts
31]
In another judgment in the case of Michigan Rubber (India) Limited
V/s. State of Karnataka and others reported at (2012) 8 SCC 216 the Hon'ble
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Supreme Court has reiterated the view that there is a very restricted scope for
Courts interference insofar as the conditions and eligibility criteria set out in the
tender is concerned. The Hon'ble Apex Court has further held that the Courts
would not interfere only because it feels that some other terms in the tender would
In the case of Tata Cellular V/s. Union of India (cited supra), relied
ig
32]
have fairer, wiser or more logical.
upon by Advocate Saboo as well as Advocate Mohgaonkar, almost all previous
cases on the point of judicial review or judicial scrutiny in the matter of tenders
flouted by the public authorities are elaborately discussed and the following
principles are deduced.
“(1)
The modern trend points to judicial restraint in
administrative action.
(2)
The court does not sit as a court of appeal but
merely reviews the manner in which the decision was made.
(3)
The court does not have the expertise to correct
the administrative decision. If a review of the administrative
decision is permitted it will be substituting its own decision,
without the necessary expertise which itself may be fallible.
(4)
The terms of the invitation to tender cannot be
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open to judicial scrutiny because the invitation to tender is in
the realm of contract. Normally speaking, the decision to
accept the tender or award the contract is reached by process
of negotiations through several tiers. More often than not,
such decisions are made qualitatively by experts.
(5)
The Government must have freedom of contract.
In other words, a fair play int he joints is a necessary
concomitant for an administrative body functioning in an
ig
administrative sphere or quasiadministrative sphere.
However, the decision must not only be tested by the
application of Wednesbury principle of reasonableness
(including its other facts pointed out above) but must be free
from arbitrariness not affected by bias or actuated by mala
fides.
(6)
Quashing decisions may impose heavy
administrative burden on the administration and lead to
33]
increased and unbudgeted expenditure.”
The Division Bench of our High Court in the case of Bee Jay
Contractors, New Delhi V/s. Hindustan Petroleum Corporation Ltd., Mumbai
reported at 2010(6) Mh.L.J.392 has categorically held that the terms of invitation to
the tenderer not open to the judicial scrutiny unless there is arbitrariness or
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favoritism. In the instant case also the petitioners have made grievance regarding
terms and conditions of the subject tender. Tested on the law laid down by the
Hon'ble Apex Court in the judgments cited above, all these objections do not
sustain. We have already observed that the petitioners have failed to bring to our
notice any malice on the part of respondents 1, 7 and 8 in scaling down the period
of contract and splitting it into five parts as well as in inclusion of clause(b) in the
ig
said contract in absence of which it may not be permissible to whittle down the
terms so included in the said contract. It was up to the Authorities issuing the
tender to decide the period of the tender and to further decide whether there should
be a composite tender or it should be in parts. The petitioners certainly cannot
dictate and so also this Court that the contract should have been an annual contract
and it should not have been divided in the parts as has been divided. Insofar as
clause(b) is concerned, we have already recorded that respondents 1, 7 and 8 have
justified the incorporation of the said clause in the subject tender. We have also
observed that no mala fides are seen on the part of respondents 1, 7 and 8 in
incorporating the said clause in the subject tender. It, therefore, appears to us that
the challenge to these aspects raised by the petitioners is misconceived and must
be rejected.
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31
Nextly, there is substance in the arguments advanced by the
34]
respondents that since the petitioners do not raise any objection regarding the
terms incorporated in the subject tender and without raising any such protest
participated in the tender process were estopped from raising any objection at the
subsequent stage. Facts on record show that the tender was published on
16/10/2013. The tenders were to be submitted up to 29/11/2013. Technical bids
were to be opened on 29/10/2013 and the price bids of the tenderers, who have
qualified the technical bid, were to be opened on 2/11/2013. There is no dispute
that the petitioners participated in the tender process and submitted their tenders
within the stipulated period. As pointed out by Shri Mohgaonkar, while submitting
the tender the petitioners have in clear terms mentioned 'they have no technical
deviation in the matter'.
35]
Similar issue was involved in the case of Haast Precision Pvt. Ltd. V/s.
State of Goa in Writ Petition No.774/2013 before this Court. In the said case the
department of the Tourism of State of Goa had invited tenders for development and
operations of water safety patrol on turn key basis. For some reasons, the date for
submission of tender was extended. It was the contention of the petitioner in the
said case that the period was extended only in order to favour respondent no.3 in
the said matter. Rejecting the contention of the petitioners this Court held that
when the petitioners did not raise any protest when the date was extended and
participated in the tender process and even in the first representation made by them
did not even whisper about their objection regarding the extension of time of the
tender in question. The view so taken by this Court squarely apply to the facts of
the present case also. As has been elaborately discussed by us here before the
petitioners participated in the tender process without raising any objection regarding
scaling down the period of contract, splitting of the said contract and inclusion of
clause(b) in the said contract. Petitioners were therefore estopped from raising
such objections at the belated stage.
36]
The another objection raised by the petitioners is that though the
petitioner no.2 has within given time submitted the necessary certificate to satisfy
clause(b) of the tender document, it was intentionally kept out of consideration to
favour respondents 2 to 6. Shri Samarth the learned counsel for the petitioners
has brought to our notice the document at Annexure CV which is the letter dated
31/10/2013 stated to be handed over by petitioner no.2 in the office of respondent
no.1 and bears the acknowledgment from the receipt clerk in the office of
respondent no.1 under his signature with date as 2/11/2013. Submission is that
respondents 1, 7 and 8 intentionally did not consider the said document and
illegally rejected the technical bid of the petitioner.
The allegation so made by the petitioners is denied by respondents 1, 7
37]
and 8. In para 10 of their written reply it has been contended that the concerned
document was received on 6/11/2013 and was never given on 2/11/2013.
Respondents 1, 7 and 8 have alleged that the petitioners have attempted to create
false evidence that it was submitted on 2/11/2013 in the office of respondent no.1.
Respondents 1, 7 and 8 have filed on record copy of the said letter which according
to them has been actually received to their office. It shows the said letter to have
been received in the office of respondent no.1 on 6/11/2013. The inward stamp is
affixed on the said letter which bears Inward No.20443 and the date as 6/11/2013.
There are other endorsements on the said letter which show journey of the said
letter from the Inward section to higher officers of respondent no.1. After receiving
the reply from respondent no.1, 7 and 8, the petitioners filed a rejoinder on
24/1/2014. In the rejoinder it is stated that Mr. Premdas Panchbudhe, Accountant
of petitioner no.2 had visited the office of respondent no.1 at about 3.30 p.m. on
2/11/2013 and had handed over the letter along with necessary documents to one
Mr. Chati and had obtained an acknowledgment from him for receipt thereof. The
fact so brought on record by petitioner no.2 vide his rejoinder dated 24/1/2014 has
been controverted by respondents 1, 7 and 8 by their reply to the said rejoinder. In
the said reply, respondents 1, 7 and 8 have contended that Mr. Chati, who is stated
to have accepted the communication and the documents annexed therewith from
Mr. Panchbudhe on 2/11/2013, had left the office on that day at 1.45 p.m. and was
not available in the office thereafter. In the circumstances, according to the
respondents the contention of the petitioners that Shri Panchbudhe handed over
the letter to Mr. Chati in the office of respondent no.1 at 3.30 p.m. on 2/11/2013
cannot be believed. Respondents 1, 7 and 8 have also placed on record the hard
copy of computerized system generated biometric report for 2/11/2013 which show
that Shri Chati had left the office at 1.45 p.m. on 2/11/2013 and was not available in
the officer thereafter. Shri Mohgaonkar then invited our attention to the letter filed
on record by the petitioners as AnnexureE. It is the letter dated 31/10/2013 and
seems to have sent by the petitioner no.2 in reply to the letter bearing Outward
No.KTPS/CE/CHPOII/T/302/eT35946/1314/1849 dated 30th October, 2013 sent
to him by respondent no.1. The learned counsel further brought to our notice that
the letter dated 31/10/2013 allegedly handed over by Accountant of petitioner no.2
to Shri Chati on 2/11/2013 is also in reply to the same letter of respondent no.1
dated 30th October, 2013 to which a reply was already received by petitioner no.2.
The learned counsel brought to our notice that in the first letter received to the office
38]
experience in mechanical maintenance.
of respondent no.1 on 1/11/2013 petitioner has stated nothing regarding the
Shri Mohgaonkar, the learned counsel for respondents 1,7 and 8,
submitted that had there been any illintention to keep the petitioners out of race,
there was no reason for respondent no.1 to give an opportunity to the petitioners by
sending them a written request letter to submit the necessary certificate showing
that they have adequate experience in mechanical maintenance and round the
clock monitoring. After having gone through the documents referred by petitioners
as well as respondents1, 7 and 8, it is apparently revealed that there is a serious
dispute between the parties regarding the receipt of one of the said letter in the
office of respondent no.1 on 2/11/2013. As such, we do not desire to enter into said
controversy. In absence of any impeccable material brought on record by the
petitioners we are unable to accept the contention of the petitioners that their
technical bid has been wrongly rejected by respondent no.1 in spite of their
submitting required documents on record. As held by the Hon'ble Apex Court in the
case of M/s. G.J. Fernandez V/s. State of Karnataka and others reported at AIR
1990 SC 958, furnishing of a required document, if is a precondition, a tenderer
can be excluded from consideration for failure to supply the said document. Even
in the judgment relied upon by the petitioners in the case of Ramana Dayaram
Shetty Vs. The International Airport Authority of India and others (cited supra)
the Hon'ble Apex Court has laid down that the tender of a person who does not
fulfill the requisite qualification cannot be accepted. As such we do not see any
error in the impugned decision of respondent no.1 rejecting the technical bid of the
petitioners.
39]
Nextly, the petitioners have alleged that none of respondents 2 to 6 did
satisfy the qualifying requirements and in spite of that the subject tender has been
allotted to them. Taking us through the documents filed on record an attempt was
made by Shri Samarth, the learned counsel for the petitioners to convince us that
none of the respondents 2 to 6 had done similar nature of work. It was vehemently
argued that none of the respondents 2 to 6 has any experience of doing or
executing the cleaning work at CHP or at augmentation plants. It was further
argued that the entire work executed by respondent no.2 is below the required
value of Rs.37,87,000/. According to the petitioners the work done by respondent
no.3 is also below the required value. Insofar as the respondents 4, 5 and 6 are
concerned it is the contention of the petitioners that none of them has done any
maintenance work and as such they were not satisfying with the criteria of having
performed 'similar nature of work'.
Respondents 2 to 6 have denied the allegation so made. They have
40]
furnished on record several documents to substantiate their plea that the have
fulfilled all requirements. Respondents 1, 7 and 8 have also contended that
respondents 2 to 6 were found qualified by the Executive Engineer (CHP) and
accordingly he had submitted a note after auditing the documents submitted by
respondents 2 to 6. It is further contended that the said audited note was placed
before the Technical Scrutiny Committee consisting of Deputy Manager (F & A),
Superintending Engineer (CHP) and Superintending Engineer (MPD) i.e.
Maintenance and Planning Department. It is further submitted that after the
scrutiny it was found that the respondents 2 to 6 were fulfilling the requirements as
per the tender conditions and the Scrutiny Committee therefore approved their
proposals and the matter was then forwarded for final approval to Deputy Chief
Engineer (O & M) and to Chief Engineer (O & M). The audited note, submitted by
the Executive Engineer, is filed on recored by respondents 1, 7 and 8. We have
carefully gone through the contents of the said document. It contains a summary
of documents submitted by each of respondents 2 to 6 and the opinion given by
Executive Engineer (CHP) regarding the eligibility of the said tenderers for opening
their price bids. The document further reveals that the said note has been signed
by Manager (F & A), Superintending Engineer (CHP) and Superintending Engineer
(O & M) and finally by Chief Engineer (O & M). We do not find it necessary to
discuss in detail the comments so made in the said audited note pertaining to the
documents submitted by respondents 2 to 6. Suffice to say that the Competent
Authorities have found respondents 2 to 6 eligible and satisfying the qualifying
requirements for opening their price bids.
41]
As has been held by the Hon'ble Apex Court in case of Tata Cellular
V/s. Union of India (cited supra) Court does not have the expertise to correct the
administrative decision. If a review of the administrative decision by the Court is
permitted, it may amount to substituting the Courts decision which does not
possess the necessary expertize and in such a case such decision by the Court
may be fallible. In the instant case, the Executive Engineer has scrutinized the
proposal and audited the documents submitted by respondents 2 to 6. Thereafter
the Scrutiny Committee consisting of High Officers having technical expertize have
considered the said audited note and ultimately have approved the same and only
thereafter price bids submitted by respondents 2 to 6 have been opened. In the
circumstances, we do not find any reason to interfere in the said decision more
particularly, when no mala fides or misuse of power or authority is seen. As held by
the Hon'ble Supreme Court in Jagdish Mandal V/s. State of Orissa reported at
(2007) 14 SCC 517, unless the decision relating to award of contract is arbitrary,
mala fide and against the public interest, Court will not interfere by exercising power
of judicial review even if there be a procedural abrasion or error in assessment or
prejudice to tenderer is made out. As has been consistently held by the Hon'ble
Apex Court the Courts do not sit as a court of appeal for the decision taken by the
Authorities in administrative capacity.
After having considered the matter from all angles, we do not find any
42]
merit in the objection raised by the petitioners that respondent no.1 malafidely
rejected their technical bid. The writ petition, therefore, fails and is accordingly
dismissed. No costs.
JUDGE
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