This is a case where the appellant has complied with the
condition of furnishing the additional performance security at
the earliest possible time, that it could possibly comply. That
no one can be compelled to perform an impossible task - Lex
non cogit ad impossibilia - is a well-accepted legal principle.
{Para 19}
20. This Court in Raj Kumar Dey and Others vs. Tarapada
Dey and Others, (1987) 4 SCC 398, while quoting, approving
and applying the maxim to the facts of that case, had the
following to say:
“6. … The other maxim is lex non cogit ad
impossibilia (Broom’s Legal Maxims – page 162) –
The law does not compel a man to do that which he
cannot possibly perform.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 5375 OF 2023
M/s Om Gurusai Construction Company Vs M/s V.N. Reddy & Ors.
Author: K.V. Viswanathan, J.
Citation: 2023INSC760.
Dated: August 23, 2023.
1. Leave granted.
2. This case brings back to memory the classic words of
Justice M. Hidayatullah (as the learned Chief Justice then was)
in Mahanth Ram Das vs. Ganga Das, [1961] 3 SCR 763.
Though it was in the context of the Code of Civil Procedure,
2
dealing with the powers of a Civil Court, the following passage
does repay study for the present facts too:
“… Such procedural orders, though peremptory
(conditional decrees apart) are, in essence, in terrorem,
so that dilatory litigants might put themselves in order
and avoid delay. They do not, however, completely estop
a Court from taking note of events and circumstances
which happen within the time fixed. For example, it
cannot be said that, if the appellant had started with the
full money ordered to be paid and came well in time but
was set upon and robbed by thieves on the day previous,
he could not ask for extension of time, or that the Court
was powerless to extend it. Such orders are not like the
law of the Medes and the Persians ….”
(emphasis supplied)
3. The question which arises for consideration in this case
is, on the facts herein, are we to construe Clause 2.22.0 (ix) of
the tender conditions as the law of the Medes and the Persians
- rigid and unalterable, even if the justice of the cause
warranted otherwise?
4. Clause 2.22.0 (ix) reads as under: -
(ix) L-I shall submit the demand draft/BG or FDR
additional performance security in the office of the
Executive Engineer, Lower Wardha Project Division,
Wardha within 2 days of opening of envelope-2. This
duration of 2 days will not be relaxed under any
circumstances. Failure to do so will result in forfeiture of
EMD and the contractor/Joint Venture (jointly or
3
individually) shall be debarred from participating in any
bid of Water Resources Department/VIDC, Nagpur for
two years from date of opening of envelope-2. If L-1 fails
to submit to additional performance security within
prescribed time period then Executive Engineer ask L-2 in
writing and if L-2 bidder agree to do work at the rate
quoted by L-1 then L-2 bidder shall be considered for
acceptance".
(emphasis supplied)
Relevant Facts
5. The facts that give rise to the question are short and
interesting. On 18.01.2021, the Executive Engineer, Lower
Wardha Project Division, Wardha issued a tender calling upon
interested bidders to submit their bid. The work, which was the
subject matter of the writ petition before the High Court, was
for "construction of land development works (Part-I) of
Gadegaon main minor offtaking @ R.D. 4995 M on Nandgaon
Dy''. Three bidders submitted their bids. The technical bid
was opened on 08.02.2021 when the appellant, and the first
respondent herein (writ petitioner before the High Court) were
found eligible. The financial bid was opened on 12.03.2021
and the appellant’s bid was found to be the lowest.
4
6. Under Clause 2.22.0 (ix), as set-out above, the appellant
was to furnish the additional performance security within a
period of two working days. It is not disputed that 13.03.2021
was a Saturday and 14.03.2021 was a Sunday and hence two
working days would expire only on 16.03.3021. It is also not
disputed that there was a nationwide employees strike in the
nationalised banks on 15.03.2021 and 16.03.2021.
7. The additional performance security was submitted on
17.03.2021. The tendering authority, after satisfying itself of
the existence of the strike, accepted the bid of the appellant
and issued work order on 07.05.2021. Thereafter, the work
commencement order was issued on 24.05.2021 to the
appellant.
Findings of the High Court on Clause 2.22.0 (ix)
8. Aggrieved, the first respondent herein filed a writ
petition on 29.04.2021 challenging the work order and the
work commencement order. That writ petition has been
allowed by the Division Bench of the High Court through the
impugned order wherein the High Court has held, with respect
to Clause 2.22.0(ix):
a) that condition prescribed in Clause 2.22.0 (ix) was
mandatory since the consequences for non-compliance
have also been prescribed;
b) that Clause 2.22.0 (ix) is an essential condition;
c) that the period for furnishing the additional performance
security was earlier eight days and was consciously
reduced to two days with a further condition that the said
period would not be relaxed/extended under any
circumstances whatsoever;
d) that the tendering authority had no power under the
tender document to relax/extend the time specified in a
clause which warrants strict compliance.
9. The High Court also referred to the facts qua another
bidder, one M/s Sai Aniruddha Construction, that had
submitted its bid for another work, and had furnished the
additional performance security with a demand draft dated
15.03.2021 from a scheduled bank. This was to demonstrate
that it was possible for a bidder under the same tender notice
to furnish the additional performance security deposit on
15.03.2021.
10. On the basis of the above findings, the High Court held
that the tender issuing authority could not have accepted the
additional performance security from the appellant herein on
17.03.2021, since 17.03.2021 was the third working day from
the opening of the financial bid.
On Additional Findings of the High Court
11. After recording the findings above, the High Court
considered the events subsequent to the issuance of the work
order in favour of the Appellant and found as follows:
a) the work order in question was issued on 24.05.2021 and
the work was to be completed within six months with a
period for rectification of deficiency within further 24
months;
b) that the appellant had on 04.02.2022 issued a
communication to the Executive Engineer stating that it
could not complete the work as allotted and had sought
time till 31.03.2023.
After noticing these facts, the High Court concluded, without
any view having been expressed by the tendering authority and
without discussing any reason given in the letters seeking
extension, that the appellant had not been able to meet the time
limit. The High Court further held that the appellant was not
justified in not adhering to the time limit. Therefore, the High
Court interfered in the matter under Article 226 on the ground
that it affects public interest.
12. The High Court should not have ventured into the
question with regard to the time limit for completion of work
and the extension sought by the appellant since that was a
matter which would depend on the facts and circumstances
that arise therein. That was for the authorities to decide
keeping in mind the myriad facts that would arise there. Even
for deciding about the need for exercise of discretionary
jurisdiction, the High Court should not have ventured into this
aspect without the full facts having been placed before it. As
to, under what circumstances the extension was sought and
what view the authority has taken over the same, even we are
completely oblivious to. The High Court should have just
confined itself to the examination of the question whether the
acceptance of the additional performance security on
17.03.2021 and the consequential issue of the work order was
justified in law or not. Having found that it was not justified,
it should have stopped there and not ventured into this issue,
since full facts were not available on the record.
On alleged breach of Clause 2.22.0 (ix)
13. In this background, the primary question that arises is,
whether the High Court was justified in setting aside the work
order on the ground that the tendering authority had breached
Clause 2.22.0 (ix) by accepting the additional performance
security on 17.03.2021?
14. We have heard Shri Amit K. Pathak, learned counsel for
the appellant, Shri Prashant Shrikant Kenjale, learned counsel
for the first respondent herein and Shri Uday B. Dube, learned
counsel for the tendering authority.
15. The admitted facts are that after the declaration of the
appellant being the L1 bidder (successful bidder) on
12.03.2021, the additional performance security was to be
submitted within two days of opening of the financial bid.
Admittedly, 12.03.2021 being a Friday, 13.03.2021 was a
Saturday and 14.03.2021 was a Sunday. Both these days were
bank holidays. Even the first respondent herein has no case
that the additional performance security could have been given
on these days.
16. The High Court, in the impugned order, noticed the
communication of the Branch Manager, Bank of Maharashtra
– the appellant’s Bank, which had not disputed the fact that on
15.03.2021 and 16.03.2021 there was a strike of bank
employees due to which there was no banking transaction on
these days. It was also not disputed at the Bar that there was
indeed a bank employees strike of the nationalised banks on
those two days. The argument was only that scheduled banks
were open and one M/s Sai Aniruddh Construction had
submitted the additional performance security for another
work, under the same tender notice through a scheduled bank.
17. The appellant countered this point in his reply filed
before the High Court as well as in the grounds before us in
the appeal, by stating that the appellant did not maintain any
account in any scheduled bank. It was averred that the
appellant was maintaining the account with the Bank of
Maharashtra. To reinforce their submission, the appellant had
also submitted that, in Form-I of the tender document which
stated about the basic information of the bidder, the appellant
had mentioned the bank name and the address along with the
details of its bank account. It was further submitted that the
Undertaking IV of the tender booklet had stated that, the
bidder had to give undertaking in respect of depositing the
earnest money deposit and performance security, through the
bank account owned by the bidder. It was averred that as such
the appellant could not use any other account to perform the
bank transaction.
18. The fact that there was a strike among the employees of
the nationalised banks is also not in dispute. It is also not
disputed that the account of the appellant was in Bank of
Maharashtra and it was that account which was disclosed as
part of the basic information, furnished with the tender
document. It is also not disputed that the bidders have given
an undertaking that earnest money deposit and performance
security would be paid through the bank account owned by the
bidder. They could not have done it through any other bank.
From the records of the Appeal, it is also clear that on a
complaint made by the first respondent herein to the
Superintending Engineer, the Superintending Engineer had
written a letter on 12.04.2021 to the Executive Engineer asking
for his comments on the complaint. The complaint was about
the appellant submitting the additional performance security
beyond the two days stipulated as per Clause 2.22.0 (ix). This
was the only grievance in the complaint of the first respondent
herein. On 19.04.2021, the Executive Engineer, in his letter to
the Superintending Engineer, mentioned that 13.03.2021 was
a Saturday and 14.03.2021 was a Sunday and also confirmed
that on 15.03.2021 since all the nationalized banks were nonoperational
due to strike, the appellant had made a request to
him to extend the time till 17.03.2021. He further stated that
since 15.03.2021 and 16.03.2021 were the days when banks
were non-operational due to strike, and since the appellant
deposited the additional performance security on 17.03.2021,
the deposit seems to be proper and a request was made to
accept the tender of the appellant. Not only this, the Branch
Manager of the Appellant’s Bank, in his letter of 11.05.2021
also does not deny that there was a strike of bank employees
on 15.03.2021 and 16.03.2021.
19. This is a case where the appellant has complied with the
condition of furnishing the additional performance security at
the earliest possible time, that it could possibly comply. That
no one can be compelled to perform an impossible task - Lex
non cogit ad impossibilia - is a well-accepted legal principle.
20. This Court in Raj Kumar Dey and Others vs. Tarapada
Dey and Others, (1987) 4 SCC 398, while quoting, approving
and applying the maxim to the facts of that case, had the
following to say:
“6. … The other maxim is lex non cogit ad
impossibilia (Broom’s Legal Maxims – page 162) –
The law does not compel a man to do that which he
cannot possibly perform. The law itself and the
administration of it, said Sir W. Scott, with reference
to an alleged infraction of the revenue laws, must
yield to that to which everything must bend, to
necessity; the law, in its most positive and peremptory
injunctions, is understood to disclaim, as it does in its
general aphorisms, all intention of compelling
impossibilities, and the administration of laws must
adopt that general exception in the consideration of
all particular cases.”
(emphasis supplied)
21. Applying the same maxim and highlighting its principle,
this Court in HUDA and Another vs. Dr. Babeswar Kanhar
and Another (2005) 1 SCC 191 stated that every consideration
of justice and expediency would require that the accepted
principle which underlies Section 10 of the General Clauses
Act should be applied in cases where it does not otherwise in
terms apply [Para 5].
22. Closer to the facts of the present case is the judgment in
Rosali V. vs. TAICO Bank and Others (2009) 17 SCC 690.
In that case, an auction was held after 4.00 p.m. when the
banks were closed. Order XXI Rule 84 of the Code of Civil
Procedure mandates that “on every sale of immovable
property the person declared to be the purchaser shall pay
immediately after such declaration a deposit of twenty-five per
cent on the amount of his purchase-money to the officer or
other person conducting the sale, and in default of such
deposit, the property shall forthwith be re-sold”. In Rosali
(supra), the 25% bid amount under Order XXI Rule 84 of the
CPC was directed to be paid the next day and it was so paid.
While accepting it as a valid deposit, this Court quoted the
following paragraph from the judgment of the Karnataka High
Court in Dakshayani vs. Branch Manager, Indian Overseas
Bank, AIR 1998 Kant 114:
“4. On that basis if we interpret the law though there is
no power in the Court to extend the time fixed by the
statute still the expression immediately is capable of
taking within its sweep a situation where an act is
impossible of performance on the day on which the
auction is held as it happened in Savithramma case [ILR
1973 Kant 1277] when the bank itself was on strike and
no deposit could have been made in the bank or in the
event the auction-sale is held after court hours, a receipt
order in that regard cannot be obtained for deposit of
such an amount. Such amount could be deposited only
after obtaining a receipt order. If next day also happens
to be a holiday, the day immediately thereafter coming
up which is a working day will be the day on which such
act will have to be performed. If any other interpretation
is given it would stultify the very object of law.”
23. In view of the above, we have no hesitation to hold that
the deposit of the additional performance security on
17.03.2021 was in due compliance of Clause 2.22.0 (ix) of the
tender conditions. There was no breach of that clause.
24. Decision making authorities, like the tendering authority
here, cannot be expected to turn a blind eye to undisputed
ground realities and compelling necessities, like the one that
presented itself here. After all, they do not live in ivory towers.
25. In this case, the tendering authority, after due
verification, about the non-operation of the banks on
15.03.2021 and 16.03.2021 due to the strike by the bank
employees, had accepted the additional performance security
on 17.03.2021 and awarded the work to the appellant. It is
well settled by a long line of judgments that the owner or the
employer of a project, having authored the tender documents,
is the best person to understand and appreciate its requirements
and interpret its documents. It has also been held that the
constitutional courts must defer to this understanding and
appreciation of the tender documents by the employer unless
there is mala fide or perversity in the understanding or
appreciation. [See Afcons Infrastructure Limited vs. Nagpur
Metro Rail Corporation Limited and Another, (2016) 16 SCC
818 and Uflex Limited Vs. Government of Tamil Nadu and
Others, (2022) 1 SCC 165)].
26. In this case, no mala fide has been alleged and the
interpretation as adopted by the tendering authority cannot be
said to be perverse. We also do not find that the decision to
accept the additional performance security on 17.03.2021 and
the issuance of the work order was arbitrary and irrational.
We also do not find it to be a decision, which no responsible
authority acting reasonably and in accordance with law could
have reached. On facts, no case of prejudice to public interest
by the award of the work has also been made out. In such
circumstances, the High Court ought not to have interfered
with the acceptance of the tender and the issuance of the work
order in the present case.
27. Learned counsel for the first respondent herein, in his
written submissions, relied upon the judgment of this Court in
Vidarbha Irrigation Development Corporation and Others
vs. Anoj Kumar Agarwala and Others, (2020) 17 SCC 577.
We have carefully considered the said judgment. In that case,
the bank guarantee which ought to have been furnished for
forty months was only furnished for six months. The facts of
the present case are completely different and, as such, the said
judgment is clearly distinguishable.
28. The other judgment relied upon is the judgment in Tata
Cellular Vs. Union of India, (1994) 6 SCC 651. On the facts
herein, it does not assist the first respondent.
29. We find nothing wrong in the authority having accepted
the tender and awarding the work to the appellant.
Other grounds raised by the first respondent
30. By way of amendments made to the writ petition before
the High Court, certain additional grievances were raised by
the first respondent herein. They were: firstly that the appellant
had filed acknowledgment of income-tax returns only for three
years and not five years and secondly the old partnership deed
and the power of attorney of Shri Devereddy Chinna Guruvi
Reddy, father of Shri D. Guru Maheshwar Reddy was filed. It
was alleged that the father had expired and the Power of
19
Attorney of a dead person had been filed. These averments
have been controverted in the reply filed by the appellant.
31. With regard to the requirement of income-tax return
acknowledgements for five years, the answer given was that
the firm itself was in existence only for three financial years
before. Even otherwise, we have not been shown the specific
clause requiring acknowledgement of the income-tax returns
for five years. In any case, the tendering authority has awarded
the work, after satisfying itself, about the necessary
compliances. The High Court has also not found it fit to
pronounce on these aspects. Hence, on this ground also, the
work order cannot be set aside.
32. With regard to the submission concerning the
reconstituted partnership deed and the Power of Attorney of
the father, the Appellant has explained it in the counter, by
stating:
20
a) that Shri D. Guru Maheshwar Reddy was always a
partner since inception; that his father had died on
05.05.2020 in the middle of the pandemic;
b) that after reaching back from the native place from
Andhra in September, 2020 the Partnership was
reconstituted and that the reconstituted Partnership Deed
was submitted to the office of the Registrar of
Partnership Firms, Aurangabad on 23.10.2020.
c) that that due to pandemic and lock down, the certified
copy of the reconstituted Partnership Deed has not been
issued till the submission of the tender form.
d) that the Partnership Deed submitted contained the name
of D. Guru Maheshwar Reddy and he was a partner right
from the registration of the firm.
Hence, it was contended that the filing of the earlier
Partnership Deed and the Power of Attorney did not vitiate the
condition of the tender process warranting disqualification. In
view of the explanation and additionally in view of the fact
21
that the tendering authority has found no illegality in the same
and further the High Court having not thought it fit to examine
this issue, we do not find merit in these additional grounds.
33. Before we part, we would do well to remind ourselves of
the words of caution administered by this Court in Jagdish
Mandal vs. State of Orissa and Others, (2007) 14 SCC 517.
Speaking for the Court, Justice R.V. Raveendran said:
“22. … Attempts by unsuccessful tenderers with
imaginary grievances, wounded pride and business
rivalry, to make mountains out of molehills of some
technical/procedural violation or some prejudice to
self, and persuade courts to interfere by exercising
power of judicial review, should be resisted. Such
interferences, either interim or final, may hold up
public works for years, or delay relief and succour to
thousands and millions and may increase the project
cost manifold. Therefore, a court before interfering
in tender or contractual matters in exercise of power
of judicial review, should pose to itself the following
questions:
(i) Whether the process adopted or decision
made by the authority is mala fide or
intended to favour someone;
OR
Whether the process adopted or decision made is
so arbitrary and irrational that the court can say: “the
decision is such that no responsible authority acting
reasonably and in accordance with relevant law could
have reached”;
22
(ii) Whether public interest is affected.
If the answers are in the negative, there should be no
interference under Article 226. ….”
34. Accordingly, the order impugned is set aside and we
direct that Writ Petition No. 1787 of 2021 on the file of the
High Court of Judicature at Bombay, Nagpur Bench, Nagpur
shall stand dismissed. The Appeal is allowed. No order as to
costs.
…....…………………J.
(J.K. Maheshwari)
..…..…………………J.
(K.V. Viswanathan)
New Delhi;
August 23, 2023.
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