M/S Super Bhootpurva Sainik ... vs U.P.S.R.T.C. Thru' Its Managing ...
2015 Latest Caselaw 216 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

AFR
 
Court No. - 32
 

 
Case :- WRIT - C No. - 20991 of 2015
 

 
Petitioner :- M/S Super Bhootpurva Sainik Suraksha Samiti Thru' Secy.
 
Respondent :- U.P.S.R.T.C. Thru' Its Managing Director & 3 Others
 
Counsel for Petitioner :- Avanish Mishra
 
Counsel for Respondent :- Sunil Kumar Mishra
 

 
Hon'ble Tarun Agarwala,J.

Hon'ble Amar Singh Chauhan,J.

The U.P. State Road Transport Corporation issued a tender dated 17.10.2014 inviting applications for cleaning of buses by Automatic Bus Washing Machines for 94 depots of the Corporation in the State of Uttar Pradesh. The petitioner and respondent no. 4 submitted their technical and financial bids. The technical and financial bids were opened on 9.2.2015 but for various reasons the bid was not finalised and subsequently the earnest money of the petitioner was returned and only then the petitioner came to know that the tender bid was cancelled. The respondent Corporation issued a fresh tender inviting applications for cleaning of buses by automatic machines for 95 depots. The petitioner and respondent no. 4 again applied and submitted their bids. The technical bid was opened on 18.2.2015 but the financial bid was not opened and subsequently the petitioner was informed that it will be opened on 20.2.2015 on which date the bid of respondent no. 4 was accepted and work order was issued on 19.3.2015. The petitioner being aggrieved by the tender process and allocation of the work order in favour of respondent no. 4 has filed the present writ petition contending arbitrariness in the exercise by the respondents in issuing the work contracts in favour of respondent no. 4.

Learned counsel for the petitioner submitted that in the first tender, invited by the respondents, the petitioner's bid was found to be lower than the bid given by respondent no. 4 and that the said tender was cancelled for vested reasons in order to give undue benefit to respondent no. 4 which they have now done in the second tender notice that was issued in February 2015. In furtherance of this submission, the learned counsel for the petitioner submitted that on the date when the financial bid was to be opened it was found that the seal containing the envelopes of the financial bids of the parties was tampered. The petitioner protested which failed and the financial bid of respondent no. 4 was accepted. The learned counsel further submitted that the reputation of respondent no. 4 is not such which warrants awarding of a contract and that one of the conditions which the respondents have to consider is the past experience of the tenderer and whether he had successfully completed the earlier contract granted to him. In support of his submission, the learned counsel for the petitioner placed reliance upon a decision of the Supreme Court in Raunaq International Limited vs. I.V.R. Construction Limited and others, (1999) 1 SCC 492 wherein the Supreme Court has held in para 9:

"The award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision, considerations which are of paramount importance are commercial considerations. These would be :

(1) the price at which the other side is willing to do the work;

(2) whether the goods or services offered are of the requisite specifications;

(3) whether the person tendering has the ability to deliver the goods or services as per specifications. When large works contracts involving engagement of substantial manpower or requiring specific skills are to be offered, the financial ability of the tenderer to fulfill the requirements of the job is also important;

(4) the ability of the tenderer to deliver goods or services or to do the work of the requisite standard and quality;

(5) past experience of the tenderer, and whether he has successfully completed similar work earlier;

(6) time which will be taken to deliver the goods or services; and often

(7) the ability of the tenderer to take follow up action, rectify defects or to give post-contract services.

Even when the State or a public body enters into a commercial transaction, considerations which would prevail in its decision to award the contract to a given party would be the same. However, because the State or a public body or an agency of the State enters into such a contract, there could be, in a given case, an element of public law or public interest involved even in such a commercial transaction."

The learned counsel has also placed reliance upon the paragraphs 70, 74 and 77 of another decision of the Supreme Court in Tata Cellular vs. Union of India, (1994) 6 SCC 651 on the question of the scope of judicial review in a writ jurisdiction and the broad principles as to what is the duty of the Court when it questions the veracity and legality of a contract. For facility, paragraph 77 of the said decision is extracted as under:

"The duty of the court is to confine itself to the question of legality. Its concern should be:

1.whether a decision-making authority exceeded its powers?

2.Committed an error law,

3.committed a breach of the rules of natural justice,

4.reached a decision which no reasonable tribunal would have reached or,

5.abused its powers."

Sri Subham Agrawal holding brief of Sri Rahul Agrawal for respondents no. 1, 2 and 3 states on instructions that the complaint made by the petitioner with regard to tampering of the financial bids was closely examined and due inquiry was made in which it was found that the allegations made by the petitioner was baseless without any foundation and was only made to pressurize to Corporation from not accepting the contract. With regard to past reputation, the learned counsel submitted that the contract given to the petitioner in one or two depots has been cancelled against which the said respondent has raised arbitration proceedings which are pending before the arbitrator and, therefore, at this stage, it was neither proper nor possible to blacklist the person nor take into consideration his past experience or conduct at this stage. The learned counsel for the respondent Corporation further submitted that the earlier tender was cancelled because it was found that out of 94 depots, bids were received only for 23 depots in which single bids were given for 14 depots and, therefore, a conscious decision was taken to issue a fresh tender.

The considerations indicated by the Supreme Court in Raunaq International (supra) while awarding a contract, no doubt has to be considered but such terms and conditions are also required to be indicated in the tender. There is nothing to indicate that past experience of the tenderer and whether he had successfully completed similar contracts, was a condition mentioned in the tender. In the absence of such conditions, it is not possible for the respondent to reject his bid merely on the ground that in one or two depots his contract has been cancelled especially when arbitration proceedings are pending between the parties before an arbitrator. The scope of judicial review would apply no doubt to commercial transactions but the onus is upon the petitioner to show the arbitrariness or favourtism in favour of the person to whom the contract was granted. In the instant case, the Court does not find any arbitrariness in the powers exercised by the Corporation in awarding the tender to respondent no. 4. Allegations of favourtism is also vague and the assertion that the financial bid was tampered was found to be untrue and an afterthought.

In the light of the aforesaid, the Court does not find any merit inviting any counter affidavit to the writ petition. The writ petition summarily fails and is, accordingly, dismissed.

Order Date :- 29.4.2015

Puspendra

(Amar Singh Chauhan,J.) (Tarun Agarwala,J.)