Bombay High Court
Khare And Tarkunde ... vs The State Of Maharashtra Through ... on 5 December, 2014
Bench: B.R. Gavai
1 WP5919-14.odt
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH : NAGPUR
Writ Petition No. 5919/2014
Khare & Tarkunde Infrastructure
Private Limited, a Company registered
under the Companies Act, 1956,
having its office at First and Second
Floor, Shivaji Complex, 235,
High Court Road, Dharampeth,
Nagpur- 440010, through its
Director Shri Jatin Manohar Tarkunde. .. PETITIONER
ig.. Versus ..
1. The State of Maharashtra,
through the Department of Public
Works, Mantralaya, Madan Cama
Road, Mumbai 400 032.
2. The Chief Engineer,
Public Works Region, having its
office at Civil Lines,
Nagpur 440 001.
3. The Superintending Engineer,
Public Works Department,
Public Works Circle, Gadchiroli,
District Gadchiroli.
4. The Executive Engineer,
Public Works Division No.1,
Gadchiroli, Dist. Gadchiroli.
5. M.B. Gharpuray Engineers and
Contractors, 838, Shivajinagar,
Anohar Residency, Pune. .. RESPONDENTS
Mr. A.A. Naik, Advocate for Petitioner.
Mrs. B.H. Dangre, Government Pleader for Respondents 1 to 4.
Mr. V.R. Thakur, Advocate for Respondent no.5.
...
::: Downloaded on - 10/12/2014 23:46:48 :::
2 WP5919-14.odt
CORAM : B.R. GAVAI & V.M. DESHPANDE, JJ.
DATED : DECEMBER 05, 2014.
ORAL JUDGMENT (per B.R. Gavai, J. )
1. Rule. Rule made returnable forthwith. Heard by consent
of the learned counsel appearing for the parties.
2. The petitioner has approached this Court being aggrieved
by the rejection of its tender at the stage of qualifying to compete
in the financial bid.
3. The facts in brief giving rise to the present writ petition
are as under:-
The respondents/State had invited tender for construction
of High Level Bridge at 171/600 on Kahani River MSH-11 Road from
State Boarder to Gondia Goregon Sadak Arjuni Gadchiroli
Chamorshi Road in Taluka and District Gadchiroli. In response to
the said tender, six bidders had submitted their bids. It is the case
of the petitioner that though Envelope No.1 was opened on
21.10.2014, the petitioner was not informed about the qualification
or disqualification of the petitioner. It is the case of the petitioner
that for the first time on 04.11.2014 he received a communication
on E-mail informing it, that it was found to be disqualified, as it had
not uploaded the scanned copy of the Registration of Firm from
original. It is the case of the petitioner that immediately on the
next day i.e. on 05.11.2014 it had addressed the representation to
3 WP5919-14.odt
the authorities. In this background, the petitioner had approached
this Court praying for declaration that the petitioner is eligible to
participate in the aforesaid tender and for further direction to the
respondents to open the financial bid of the petitioner. The
petitioner had also prayed for an interim protection.
4. The petition had come up before us for admission on
11.11.2014. On the said date, we had issued notice to the
respondents and also granted ad-interim order directing the parties
to maintain status quo as on the said date. On the said date itself,
it was informed by the learned Government Pleader that the tender
was already allotted to the lowest bidder on 04.11.2014 itself.
Accordingly on the oral motion by the petitioner, respondent no.5
was permitted to be impleaded as party respondent. The
respondents have filed elaborate replies so also the petitioner has
filed rejoinder.
5. It is the basic contention of the petitioner that the
petitioner's tender was rejected on hypertechnical ground. It is the
case of the petitioner that the condition on which the petitioner's
tender was rejected, cannot be said to be an essential condition.
The learned counsel in that respect relies on the judgments of the
Apex Court in the case of M/s G.J. Fernandez .vs. State of
Karnataka and others reported in AIR 1990 Supreme Court
958; Rashmi Metaliks Ltd. and another .vs. Kolkata
4 WP5919-14.odt
Metropolitan Development Authority & ors. reported in 2013
(11) SCALE; Poddar Steel Corporation .vs. Ganesh
Engineering Works and ors. reported in (1991) 3 Supreme
Court Cases 273 and on the judgment of the Division Bench of this
Court in the case of Agrawal Roadlines Pvt. Ltd. .vs. Indian Oil
Corporation Ltd. and ors. reported in 2003 (1) Mh.L.J. 610.
6. It is further contended by Mr. Naik, learned counsel
appearing on behalf of the petitioner that the petitioner was in fact
held to be qualified on 21.10.2014 when the envelopes were
opened. However, the record has been manipulated so as to suit
respondent no.5. It is submitted that the communication informing
the petitioner, that it is disqualified is sent on E-mail on 04.11.2014
i.e. the date on which respondent no.5 was awarded the contract.
He further submits that the entire manner in which the tender is
allowed to respondent no.5 shows that the authorities had made up
their mind to award the contract to respondent no.5. It is submitted
that on 05.11.2014 itself the Assistant Chief Engineer informs the
Executive Engineer that an approval has been granted for accepting
the tender of respondent no.5. On the same date the Executive
Engineer informs respondent no.5 that its tender has been
accepted and it should deposit an amount of Rs.16,25,000/- towards
E.M.D. It is submitted that surprisingly on the same date, the fixed
deposit receipt for the said sum travels from Pune to Gadchiroli and
is accepted by the authorities. It is, therefore, submitted that the
5 WP5919-14.odt
entire procedure adopted by the respondents- authorities cannot be
said to be conforming to the norms as laid down by the Apex Court
in the various judgments. The learned counsel, therefore, submits
that rejection of the petitioner's bid and denial of participation in
the financial bid is not sustainable in law and a direction needs to
be issued that the petitioner was qualified and is entitled to
participate in the financial bid. The learned counsel makes a
categorical statement that the bid of the petitioner is a lower than
the bid accepted i.e. of respondent no.5. It is submitted that though
it is the case of the respondents that the petitioner was informed on
21.10.2014 regarding its disqualification, the same is not true. It is,
however, submitted that even if it is accepted for a moment that
the petitioner was informed about the same on 21.10.2014, the
same would not take effect, till the actual date of the
communication by the respondents regarding disqualification of the
petitioner. The learned counsel in that respect relies on the
judgment of the Apex Court in the case of Bipromasz Bipron
Trading SA .vs. Bharat Electronics Limited (BEL) reported in
(2012) 6 Supreme Court Cases 384.
7. Mrs. Dangre, learned Government Pleader and Mr.
Thakur, learned counsel for the successful bidder, vehemently
opposed the petition. Mrs. Dangre submits that the contention
regarding the submission of scanned copy of the Registration of
Firm from original is an essential condition inasmuch as it is found
6 WP5919-14.odt
that various companies which are not in existence participate in the
tender process. It is submitted that if on account of such
participation it is found that such a company does not have a
credential, the entire tender process comes into difficulty thereby
causing great hardship to the authorities. It is submitted that the
entire process has been done in a fair, transparent manner and
calls for no interference.
8. Mr. Thakur, learned counsel submits that the petitioner
has taken chances. He submits that though the petitioner was
aware regarding its disqualification as early as on 21.10.2014, it
waited till opening of the tender of respondent no.5 and only after
the bid of respondent no.5 became open, has chosen to approach
this Court. It is submitted that the petitioner has also suppressed
material facts and therefore, the petition is likely to be thrown
away on this count alone. It is further submitted that the contract is
in the public interest. Relying on the judgment of the Apex Court in
the case of Siemens Public Communication Networks (P)
Ltd. .vs. Union of India reported in (2008) 16 Supreme Court
Cases 215, the learned counsel submits that in tender matters this
Court should not interfere inasmuch as the interference would be
prejudicial to the larger public interest. The learned counsel also
relies on the judgment of the Apex Court in the case of Michigan
Rubber (India) Ltd. .vs. State of Karnataka and others
reported in (2012) 8 Supreme Court cases 216 in support of the
7 WP5919-14.odt
same proposition. The learned counsel submits that the evaluation
of the tenders is a highly technical matter and this Court while
exercising jurisdiction under Article 226 of the Constitution of India
cannot sit in an appeal over the evaluation of the tenders by the
tendering authorities. The learned counsel as well as Mrs. Dangre,
learned Government Pleader , therefore, submit that the petition is
dehors of merit and is liable to be dismissed.
9. The Apex Court in a recent judgment in the case of
Rashmi Metaliks Ltd. (supra) has come down heavily on lengthy
judgments. The Apex Court has observed that though the law has
been very well crystallized, the Courts go on reproducing the
judgments after judgments and make the judgments bulkier. It has
been further observed that the law insofar as the judicial review in
tender matters has been very well crystallized in the case of Tata
Cellular v. Union of India (1994) 6 Supreme Court Cases 651
and reference to other judgments would not be necessary. Taking
the mandate of the Apex Court in the case of Rashmi Metaliks
Ltd. (supra), it would be relevant to refer to the observations of the
Apex Court in the case of Tata Cellular. The Apex Court in
paragraph 77 observed thus:-
"77. The duty of the court is to confine
itself to the question of legality. Its concern
should be :
1. Whether a decision-making authority
8 WP5919-14.odt
exceeded its powers?
2. Committed an error of 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.
Therefore, it is not for the court to determine
whether a particular policy or particular
decision taken in the fulfillment of that policy is
fair. It is only concerned with the manner in
which those decisions have been taken. The
extent of the duty to act fairly will vary from
case to case. Shortly put, the grounds upon
which an administrative action is subject to
control by judicial review can be classified as
under:
(i) Illegality : This means the decision- maker
must understand correctly the law that
regulates his decision-making power and must
give effect to it.
(ii) Irrationality, namely, Wednesbury
unreasonableness.
(iii) Procedural impropriety.
The above are only the broad grounds but it
does not rule out addition of further grounds in
course of time. As a matter of fact, in R. v.
Secretary of State for the Home Department,
ex Brind28, Lord Diplock refers specifically to
one development, namely, the possible
9 WP5919-14.odt
recognition of the principle of proportionality.
In all these cases the test to be adopted is that
the court should, "consider whether something
has gone wrong of a nature and degree which
requires its intervention".
It is thus clear that the only inquiry that would be permissible for us
would be as to whether the decision making process was legal,
proper, just and fair or as to whether the decision making process
suffers from any illegality or not. We cannot sit in an appeal over
the decision of the authorities.
10. The Apex Court in various cases including in the case of
M/s G.J. Fernandez (supra) has considered as to what are the
essential conditions and what are non-essential conditions in the
tender matter. In the present case, para 11 of the tender document
which deals with the On Line Envelope No.1 reads thus:-
"11. ON LINE ENVELOPE NO.1
(Documents Required)
The first online envelope "ENVELOPE NO.1"
shall contain the following:
Scanned copy of Forwarding (Covering)
Letter along with list of all
documents/forms/statements/Specifications/
Conditions.
i) Scanned from original copy of
Government treasury challan or
Term Deposit Receipt valid for a
10 WP5919-14.odt
period of one year of Rs.8,12,000/-
issued from any Schedule Bank
and duly endorsed in the name of
Executive Engineer Public
Works Division No.1 Gadchiroli
or valid certificate of exemption
from payment of earnest money if
applicable and Scanned from
original copy Additional
(Performance) Security (if
required) (copy to be submitted as
ig ii)
per the tender Schedule).
Scanned from original copy of
DD/Pay Order payable towards
costs of document in the name of
Executive Engineer, Public
Works Division No.I Gadchiroli.
iii) Scanned from original copy of
Valid certificate as a Registered
Contractor with the Government of
Maharashtra in appropriate class.
iv) Scanned from original copy of
valid VAT registration certificate
from Maharashtra State Sale Tax
Department (Maharashtra Value
Added Tax Act 2005).
v) Scanned from original copy of list
of works in hand and works
tendered along with supporting
certificates.
vi) Scanned from original copy of
Details of the other works
tendered for and in hand as on the
11 WP5919-14.odt
date of submission of this tender
in prescribed form No.II.
vii) Scanned from original copy of
Details of wok of similar type with
supporting certificates.
viii) Scanned From original copy of List
of Technical Personnel of the
tenderer and further likely to be
appointed on this work form No. IV
and in form No.VII.
ix) Scanned from original copy of
ig affidavit regarding completeness,
correctness and truthfulness of
documents submitted on Rs.100/-
Stamp paper as per prescribed
proforma given in Annexure I
sworn before Executive
Magistrate/Notary.
x) Scanned from original copy of
original Professional Tax
Registration/ Clearance Certificate.
xi) Scanned from original copy of
Registration of firm, Partnership
Deed and Power of Attorney,
Notarized Joint Venture if
applicable in case of a firm
tendering for work.
xii) Scanned from original copy of
Statements showing the similar
type of bridge works executed
during the last three years in
prescribed form no.1.
xiii) Scanned from original copy of
12 WP5919-14.odt
Contractor own design with broad
details.
xiv) The tenderer should further
demonstrate availability of the
Machinery/equipments according
to list of machinery mentioned in
Schedule No.1.
xv) Availability for this work following
technical personnel.
(i) A project Manager having
minimum qualification as
ig B.E.(Civil) with not less than
10 years experience in
construction and supervision
of bridge work (information
to be submitted in Form VII.
The scanned copy of
curriculum vitae shall be
upload in Envelope No.1.
(ii) Site Engineers-1 Number
having minimum
qualification as Diploma
(civil) having experience of
10 years.
(iii) On supervisor having
experience of 10 years and
other one having experience
of minimum 5 years of
Bridge works. The scanned
copy of curriculum vitae
shall be upload in Envelope
No.1 Form VII.
xvi) Undertaking that he/they will
13 WP5919-14.odt
mobilize the Concrete Mixer with
integral weigh batcher with
computerized and automated
water dispensing arrangements
within 30 days from the work
order. Scanned copy from original
of Certificate for having."
11. It could thus be seen that Para 11 requires documents of
16 types to be included in envelope no.1. Clause No.(i) provides
for a scanned from original copy of Government challan or Term
Deposit Receipt valid for a period of one year of Rs.8,12,000/-.
Clause no. (ii) provides for scanned from original copy of DD/Pay
Order payable towards cost of document. Clause No.(iii) provides
for a scanned from original copy of Valid certificate as a Registered
Contractor with the Government of Maharashtra. Clause No.(iv)
provides for a scanned from original copy of valid VAT registration
certificate from Maharashtra State Sale Tax Department. Clause
No.(v) provides for scanned from original copy of list of works in
hand and works tendered along with supporting certificates. Clause
No.(vi) provides for scanned from original copy of details of the
other works tendered for and in hand as on the date of submission
of the tender. Clause (vii) provides for scanned from original copy
of the details of work of similar type with supporting documents.
Clause No.(viii) provides for scanned from original copy of list of
Technical Personnel of the tenderer and further likely to be
14 WP5919-14.odt
appointed on the work. Clause no.(ix) provides for scanned from
original copy of affidavit regarding completeness, correctness and
truthfulness of documents. Clause no.(x) provides for scanned from
original copy of Professional Tax Registration/Clearance Certificate.
Clause No.(xi) with which we are concerned in the present petition
provides for scanned from original copy of Registration of Firm,
Partnership Deed and Power of Attorney, Notarized Joint Venture, if
applicable in case of a firm tendering for work. Clause No.(xii)
provides for the scanned from original copy of Statements showing
the similar type of bridge works executed during the last three
years. Clause no.(xiii) provides for scanned from original copy of
Contractor's own design with broad details. Clause No.(xiv)
provides for details regarding the availability of the
Machinery/equipments etc. Clause (xv) provides for availability of
the technical personnel for the work. Clause No.(xvi) provides for
an undertaking that the tenderer will mobilize the Concrete Mixer
with integral weight batcher with computerized and automated
water dispensing arrangements within 30 days from the work order.
12. It will also be relevant to refer to the definition of the
Contractor:-
"THE CONTRACTOR" shall mean the individual
or firm or company whether incorporated or
not, undertaking the work and shall include
legal representatives of such as individual or
persons composing such firm or company as
15 WP5919-14.odt
the case may be."
13. It could thus be seen that the definition of the Contractor
includes an individual or firm or company whether incorporated or
not undertaking the work and also includes legal representatives of
such as individual or persons composing such firm or company as
the case may be.
14. The Apex Court after scrutinising the law on the issue as
to what could be construed as essential and non-essential
conditions in tender matters, in the case of Rashmi Metaliks Ltd.
(supra) has observed thus :-
"13. So far as clause (j) of the detailed notice
inviting E-tender No.1/KMDA/MAT/CE/2013-2014
dated 10.5.2013 emanating from the office of the
Chief Engineer is concerned, it seems to us that
contrary to the conclusion in the impugned
judgment, the clause is not an essential element or
ingredient or concomitant of the subject NIT. In
the course of hearing, the Income Tax Return has
been filed by the Appellant-company and
scrutinized by us. For the Assessment year
2011-2012, the gross income of the Appellant-
company was Rs.15,34,05,627, although, for the
succeeding Assessment Year 2012-2013, the
income tax was NIL, but substantial tax had been
deposited. We think that the Income Tax Return
would have assumed the character of an essential
term if one of the qualifications was either the
16 WP5919-14.odt
gross income or the net income on which tax was
attracted. In many cases this is a salutary
stipulation, since it is indicative of the commercial
standing and reliability of the tendering entity.
This feature being absent, we think that the filing
of the latest Income Tax Return was a collateral
term, and accordingly the Tendering Authority
ought to have brought this discrepancy to the
notice of the Appellant-company and if even
thereafter no rectification had been carried out,
the position may have been appreciably different.
It has been asserted on behalf of the Appellant-
Company, and not denied by the learned counsel
for the Respondent-Authority, that the financial bid
of the Appellant-Company is substantially lower
than that of the others, and, therefore, pecuniarily
preferable."
15. In the said case, the appellant before the Apex Court was
refused participation in the financial bid on the ground that the
tenderer i.e. the appellant had failed to place on record the latest
Income Tax and Professional Tax Returns. The Apex Court found
that the Income Tax Return would have assumed the character of
an essential term if one of the qualifications was either the gross
income or the net income on which tax was attracted. It was
further observed that in many cases this is a salutary stipulation,
since it is indicative of the commercial standing and reliability of the
tendering entity. It is further observed that filing of the latest
Income Tax Return was a collateral term and accordingly the
17 WP5919-14.odt
Tendering Authority ought to have brought this discrepancy to the
notice of the Appellant -Company and if even thereafter no
rectification had been carried out, the position would have been
different.
16. In the light of the aforesaid observations, we will have to
consider as to whether the submission of the scanned copy of the
Registration of Firm from original can be considered to be an
essential condition or as to whether the same was only a collateral
and non-essential condition. For that, it will also be relevant to
refer to the para 12 of the tender document which reads thus :-
"12. Post Qualification criteria: To qualify
for the opening of envelope No.2 i.e. Price
Bid, each bidder should have
(i) Scanned copy from original of Certificate
for having achieved an average annual
turnover of Rs.1220.00 lakh during last
three financial years updated to current
cost (Such certificate for civil engineering
works excluding private works are
required to be obtained from the
Chartered Accountant of Maharashtra
State only). For updating to current cost
please refer table at the end of this
clause.
(ii) Scanned from original copy of certificate
for having satisfactorily complete at least
one, two lane major bridge work (River
18 WP5919-14.odt
Bridge/ROB) on his own design/PWD
Design of value not less than Rs.500.00
lakh or should have executed on his own
design/P.W.D. Design at least one work of
Major bridge of minimum length 150.00
mtrs. In a period of three consecutive
years falling in last five years. For
updating to current cost please refer
table at the end of this clause. (Such
certificate are required to be obtained
from the officer not below the Rank of
Executive Engineer.
executed in Public
In case of worked
Limited co. then
upload an original copy of certificate from
General Manager countersigned by
Chartered Accountant).
(iii) Satisfactorily executed minimum
quantities of following items in any
continuous twelve calendar months
during last five year and current year.
Scanned copy of original certificate to this
effect should be attached/uploaded.
(Such certificates including Concrete with
Grade, Reinforcement, Period of
execution etc. are required to be obtained
from the officer not below the rank of
Executive Engineer or Equivalent, in case
of quantity, executed in Public Limited Co.
then upload an original copy of certificate
from General Manager with countersign of
Chartered Accountant) and the
certificate shall specially mention
the period of execution as
19 WP5919-14.odt
continuous twelve calendar months.
(Completed Work Carried out in Govt./Semi Govt.
Bodies such as MHADA, MSEB, MIDC, CIDCO etc.
for Local Bodies, public limited company, inter alia
will only be considered).
a) Concrete of Grade M-25 & above
4000.00 cum.
b) HYSD/TMT steel 200.00 MT.
In case of information for items 12(i) to 12(iii) the
tenderer shall provide authentic proof of
information given therein. This shall include a
certificate from his chartered accountant for item
12(i) and for items 12(ii) & 12(iii) certificates from
an officer not below the rank of Executive Engineer
in envelop No.1 only. In absence of these
documents, envelope No.2 shall not be opened.
For satisfying the above criteria at Sr. No. 12(ii) to
12(iii) above work carried out in Government
Organization or the Works of Semi Govt's Bodies
such as MHADA, MSEB, MIDC, CIDCO etc. or local
Bodies will be considered.
13. Bid Capacity: The Bid capacity shall not be
less than the amount put to tender for which the
bid is submitted. Bid capacity will be evaluated as
part of post qualification in the following manners.
Calculation of Bid Capacity should be required on
contractor's letter head."
17. It could thus be seen that even in the tender notice itself
what shall be an essential condition for opening of envelope no.2
i.e. Price Bid has been specifically provided for. Clause (i) of the
20 WP5919-14.odt
said para provides that a scanned copy from original of Certificate
for having achieved an average turnover of Rs.1220.00 lakh during
last three financial years has to be provided. Clause (ii) provides
for a scanned from original copy of certificate for having
satisfactorily completed at least one two lane major bridge work
(River Bridge/ROB) on his own design/PWD Design of value not less
than Rs.500.00 lakh etc. Clause (iii) provides for satisfactorily
executed minimum quantities like requirement of concrete of Grade
M-25 and above 4000.00 cum., HYSD/TMT steel 200.00 MT etc.
within a period of twelve calendar months. It could clearly be seen
that the aforesaid documents are necessary to find out as to
whether the participant possesses the necessary experience and
capacity for carrying out the work of the nature for which the tender
is floated. These documents are necessary for evaluating as to
whether the tenderer is in effect having an experience of the
nature of the work for which the tender is called. The said clause
also provides for providing the documents to find out whether the
tenderer has a bidding capacity or not. It could thus be seen that
even the authorities itself, while drafting the notice inviting tender,
construed that the documents pertaining to an experience of the
nature of the work tendered for and the documents pertaining to
bidding capacity are the essential documents which are required to
be complied with by every tenderer.
18. Apart from that the definition of the Contractor itself
21 WP5919-14.odt
would reveal that even a person who is an individual or firm or a
company whether incorporated or not, could have submitted the
tender. Undisputedly in case of an individual or in case of the
incorporated company, there could be no question of original copy
of the Registration of the Firm. Apart from that Clause (xi) which
has been heavily pressed into service by the learned Government
Pleader and Mr. Thakur, learned counsel appearing on behalf of the
successful bidder, would show that the same cannot be construed
to be an essential condition. The words used in Clause (xi) are "if
applicable in case of a firm tendering for work". In that view of the
matter the harmonious construction of the Clause (xi) and the
definition of the Contractor would clearly establish that the
submission of scanned copy from original copy of the Registration of
the Firm cannot be construed to be an essential condition so as to
non-suit a tenderer. At the cost of repetition, the individual or an
incorporated company cannot be even dreamt of submitting a
scanned copy from original copy of Registration of Firm. No doubt
that Mr. Thakur has tried to canvass that the petitioner also thought
that the same would be an essential condition and as such had
submitted the scanned copy of the xerox from original copy of
Registration of Firm. It is, therefore, submitted that the petitioner
having been complied with the same, it is not open for the
petitioner now to say that the same is not an essential condition.
With great respect we cannot construe a condition to be an
essential or non-essential, as is understood by "A" party or "B"
22 WP5919-14.odt
party. For deciding a question as to whether a particular condition
is an essential condition or non-essential condition, we are bound by
the law as laid done by the Apex Court. Applying the law which is
consistently followed by the Apex Court in the case of M/s G.J.
Fernandez, Poddar Steel Corporation and in the latest judgment
in the case of Rashmi Metaliks Ltd., we find that the condition
cannot be said to be essential in nature so as to oust the tenderer.
19. Much is sought to be made out on the ground that the
petitioner itself was aware on 21.10.2014 that he stood disqualified.
Undisputedly in the list of the qualified tenderers displayed on
21.10.2014, the name of the petitioner is included. It is insisted by
the learned Government Pleader as well as Mr. Thakur that the said
list was of the tenderers who are qualified to participate in the
tender and not of the persons who were held to be qualified. To a
pertinent query to the learned Government Pleader as to whether
after opening of Envelope, list of qualified tenderers which
according to it were found to be qualified has been uploaded on the
net or not, the learned Government Pleader fairly concedes that no
such list was uploaded on the net either on 21.10.2014 or
thereafter. Also to a pertinent query as to whether between
21.10.2014 and 04.11.2014 the petitioner has been communicated
regarding it being disqualified to participate in the financial bid, the
learned Government Pleader again fairly concedes that no such
communication has been addressed to it between 21.10.2014 and
23 WP5919-14.odt
04.11.2014. Also to a pertinent query to the learned Government
Pleader, as to whether on the basis of the record and on the basis
of the instructions by the authorized person who is personally
present in the Court, that only on 04.11.2014 the petitioner has
been communicated that he stood disqualified on account of non-
compliance of clause (xi) of para 11 of tender document, the
learned Government Pleader fairly concedes that it is only on
04.11.2014 that the petitioner was communicated regarding his
disqualification and not in earlier point of time.
20. The Division Bench of this Court in the case of Agrawal
Roadlines Pvt. Ltd. (supra), the judgment authored by His
Lordship Hon'ble Mr. Lodha, J. (as His Lordship then was), has
observed thus:-
"7. The aforesaid law laid down by the Apex Court
in Poddar Steel Corporation is squarely and fully
applicable to the facts and circumstances of the
present case. The only mistake committed by the
petitioners was that they annexed the demand
draft issued in favour of other Corporation. That
was only a technical irregularity and did not in the
facts of the case could be said to violate the
essential conditions of the tender notice. It was
only because of inadvertence that the demand
drafts purchased by the petitioners got
interchanged. Under the terms and conditions of
the tender notice, inter alia, for the satisfaction of
financial credibility of the bidder, the condition is
24 WP5919-14.odt
that earnest money of Rs.12000/- by way of
crossed demand draft/pay order from the
scheduled bank in favour of concerned corporation
is deposited with the bid. The Corporation , viz.
IOC, HPCL and BPCL ought not to have given strict
construction to clause 7 of the tender which
provided that the earnest money deposit as
provided in clauses 5 and 6 by crossed Demand
Draft/Pay Order drawn on any Scheduled Bank, be
in favour of concerned Corporation like Indian Oil
Corporation Ltd. (MD), Bharat Petroleum
corporation Ltd. (MD) and Hindustan Petroleum
Corporation (MD). The essential clause concerning
an interest free earnest money deposit of Rs.
12000/- finds place in clause 6 which, of course,
was required to be construed strictly, but clause 7
could not have been given effect in meticulous
detail as has been sought to be given when the
petitioners did purchase demand draft in favour of
concerned corporation in the required sum from
scheduled bank- the only mistake, these drafts got
interchanged at the time of submission of tenders
and this mistake reflected at all necessarily places
in the tender form. The contention of Mr. Siodia
that this Court should not interfere in
administrative decision when admittedly there was
some mistake by the petitioners in the facts of the
present case does not deserve to be accepted. If
an administrative decision is based on
hypertechnical approach by treating a non-
essential condition of the tender notice as essential
condition, such administrative decision shall be
ceased to be fair and lack reasonableness
25 WP5919-14.odt
warranting interference in suitable and deserving
cases under Article 226."
(Underlining ours)
21. In the present case, we have no hesitation to say that the
decision of the authorities is based on hypertechnical approach by
treating a non-essential condition of the tender notice to be an
essential condition and as such the said decision will have to be
deemed to be not fair and the one lacking reasonableness
warranting interference under Article 226 of the Constitution of
India.
22. The speed at which the State Government and
respondent no.5 have travelled in the present case, is also to be
complimented. No doubt that as submitted by the learned
Government Pleader and the learned counsel Mr. Thakur that this is
an era of technical advancement and, therefore, nothing is
impossible. This is difficult to digest. On 04.11.2014 itself the
petitioner was communicated for the first time as is apparent from
the record that his tender is disqualified for non-compliance of
clause No.(xi). It is further to be noted that the record itself shows
that the petitioner had in fact uploaded a scanned copy of the xerox
of the original copy of Registration of Company. It is not as if no
document pertaining to the Registration of Company was available
with the authorities. On 04.11.2014 itself the tendering committee
26 WP5919-14.odt
takes a decision to award a contract to respondent no.5. On
05.11.2014 the communication was addressed by the Assistant
Chief Engineer, who has a office at Nagpur, to the Superintending
Engineer, P.W.D., Gadchiroli thereby approving the award of
contract to respondent no.5. On the same day the said letter
reaches Gadchiroli from Nagpur , which is at a distance of around
170 kms. On the same day, the Executive Engineer, P.W.D.
Gadchiroli addresses a communication to the respondent no.5
asking it to furnish an amount of Rs.16,25,000/- by way of EMD.
Remittance is to be made either in cash/Band Draft of the
Scheduled Bank/F.D.R./NSC. On the same day, respondent no.5
addressed a letter to the Executive Engineer, Gadchiroli annexing
along with the said letter a FDR in the sum of Rs.16,25,000/-. It is
to be noted that in the said letter in the column of reference at
column no.3 it is written as "your letter No...........". However, the
number of the letter is not to be found there. On the same day, an
EMD in the sum of Rs.16,25,000/- issued by the Bank at Pune
reaches Gadchiroli which is at a distance of around 700 kms. No
doubt that taking into consideration the larger public interest the
attempt of the State Government to travel at a speed is laudable.
However, the State Government appears to have forgotten that at
times travelling at such a breakneck speed amounts to driving in
rash and negligent manner, leading to unforeseen accidents.
23. Insofar as the judgment in the case of Siemens Public
27 WP5919-14.odt
Communication Networks Private Limited and another
(supra) , on which a heavy reliance is placed by Mr. Thakur is
concerned, the tender in question involved modernisation plan of
Technical Communisation System for Indian Army. For evaluation
of the tenders in question, the trials and technical expertise of a
high degree were involved. For doing so, an expert committee
which was to carry out a comprehensive evaluation for arriving at
L1 bidder, was formed. Accordingly the expert committee had
carried out comprehensive evaluation for arriving at the L1 bidder.
In that view of the matter, the Apex Court while confirming the
order of the High Court held that when the element of public
interest was involved and tender was bona fide awarded, an
interference by the High Court or the Apex Court was not
warranted. The facts in the said case were totally different. The
said contract pertained to sensitive army equipments which were
urgently needed. Apart from that both the High Court as well as the
Apex Court have come to the conclusion that process adopted or
decision made was not such, that no responsible authority acting
reasonably or in accordance with the relevant law could follow or
take such a decision. In that view of the matter, we find that the
judgment in the said case would not be applicable to the facts of
the present case.
24. Insofar as the judgment in the case of Michigan Rubber
(India)Limited (supra) is concerned, in the said case the appellant
28 WP5919-14.odt
before the Apex Court being aggrieved by a modification of the pre-
qualification criteria, had approached the High Court. The learned
Single Judge as well as the Division Bench of the High Court did not
found favour with the contention and as such he was required to
approach the Apex Court. Dismissing the appeal, the Apex Court
found that in formulating conditions of a tender document and
awarding a contract, greater latitude is required to be conceded to
the State authorities. It further held that unless the action of the
tendering authority is found to be malicious and a misuse of its
statutory powers, interference by Court would not be warranted. In
that view of the matter, the said judgment would also not be
applicable to the facts of the present case.
25. We are, therefore, of the considered view that the
decision making process of the State Government is vitiated on
various counts, firstly when the tender notice itself provided as to
what are the essential conditions for opening financial bid , the
authorities have rejected the tender of the petitioner on an
untenable ground. We find that the case would be covered by sub-
clause (i) of para 77 of the law laid down by the Apex Court in the
case of Tata Cellular. We find that the decision maker has not
understood the law correctly and as such his decision has been
vitiated on the ground of not understanding the law properly and
passing an order in contravention of the said proposition of law. We
further find that the manner in which the Department has
29 WP5919-14.odt
proceeded also cannot be said to be fair and transparent. If
according to the State Government, the petitioner was disqualified
on 21.10.2014 itself, nothing precluded the Department from
communicating the same to the petitioner from 21.10.2014 to
04.11.2014. The communication of the same on 04.11.2014 and
opening of the tenders and taking a decision to award the same to
the respondent no.5 on 04.11.2014, though may be out of sheer
coincidence, cannot be said to be free from doubt.
26.
It was submitted by the learned Government Pleader
yesterday that since the petitioner's tender was rejected and his bid
was locked and, therefore, it will not be possible for the State to
open its financial bid. We , therefore, requested the learned
Government Pleader to ask the Officer who is conversant with the
process of technology applied in tender matters to remain present
in the Court. Accordingly Mr. Shrikant Golkutwar, Assistant
Engineer in Information and Technology Department of the Public
Works Department, Nagpur is personally present in the Court. He
has stated that it is possible to open the financial bid of the
petitioner. On a specific query, he has stated that it is not possible
for the petitioner to change his bid and the Department possesses
the technical experience to open the financial bid of the petitioner
as was submitted by it in its original tender.
27. In that view of the matter, we hold that rejection of the
30 WP5919-14.odt
petitioner's tender was on hypertechnical ground. The petitioner
could have very well been called upon to submit the scanned copy
from original copy of Registration of Firm. In any case perusal of
Clause (xi) of Para 11 of tender document would reveal that same
is applicable only to the firms and would not be applicable to either
company or an individual. The learned counsel for the petitioner,
however, submits that the original copy of Registration of Company
would be produced before the authorities so that they can verify
that the original copy of Registration of Company exists.
28. In that view of the matter, we hold that the rejection of
the petitioner's tender was on hypertechnical ground which is not
sustainable in law. We hold that the petitioner was qualified to
participate in the financial bid. The respondents/authorities are,
therefore, directed to open the financial bid of the petitioner.
Needless to state that since the award of contract to respondent no.
5 was not in consonance with the legal position, the same is
quashed and set aside. The respondent/authorities shall take
decision in accordance with the law in the light of what has been
observed hereinabove. Rule made absolute in the aforesaid terms.
No costs.
(V.M. Deshpande, J. ) (B.R. Gavai, J.)
...
halwai/p.s.
