Bombay High Court
M/S Pharmaveda I Pvt Ltd vs Chief Executive Officer Zilla Parishad ... on 18 January, 2024
Author: Vibha Kankanwadi
Bench: Vibha Kankanwadi
2024:BHC-AUG:1040-DB
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
WRIT PETITION NO.14938 OF 2023
M/s. Pharmaveda (I) Pvt. Ltd.
Having its registered office at
B-4, Kamdar Shopping Center,
Tejpal Road, Opposite Railway
Station, Vile Parle East, Mumbai
400 057. .. Petitioner
Versus
1. Chief Executive Officer,
Zilla Parishad Nandurbar,
Devmogra, Nandurbar,
Maharashtra 425412
2. Narmada Enterprises,
At Shirpurwade Mala,
Post Shirpurwade,
Near Jaikheda Road,
Baglan, Dist. Nashik,
Maharashtra Pin 423204
3. Shree Enterprises,
12 Saikurpa, Ganchi Nagar
Bus Stop, Dhule Road,
Nandurbar City, Dist. Nandurbar,
Maharashtra 425412
4. State of Maharashtra
Mantralaya, Madam Cama Road,
Hutatma Rajguru Square,
Nariman Point,
Mumbai 400 032. .. Respondents
..........
Mr. A. S. Khandeparkar, Senior Counsel a/w Mr. Sujay Gawade, Advocate
i/b Mr. R. R. Karpe, Advocate for petitioner.
Mr. P. S. Patil, Advocate for respondent No.1.
[1]
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Mr. V. D. Sapkal, Senior Counsel i/b Mr. S. R. Sapkal, Advocate for
respondent No.2.
Mr. V. M. Jaware, AGP for respondent No.4.
..........
CORAM : SMT. VIBHA KANKANWADI AND
S. G. CHAPALGAONKAR, JJ.
RESERVED ON : JANUARY 08, 2024.
PRONOUNCED ON : JANUARY 18, 2024.
JUDGMENT (Per Smt. Vibha Kankanwadi, J) :
-
. Rule. Rule made returnable forthwith. Heard learned Advocates for
the appearing parties finally by consent.
2. The petitioner is challenging its disqualification in the technical bid
as well as the acceptance of technical bid of respondent Nos.2 and 3 by
respondent No.1.
3. The petitioner is the manufacturer of specialty food products
including the product under the food category 13.5 Dietetic Foods/Foods
for Special Dietary Use. It is a company registered under the Companies
Act. Respondent No.1 had invited bids for supply of multi-micronutrient
supplement granules to children in the age group of 3 to 6 years at
Anganwadi centers in tribal areas as well as micronutrient supplement
granules to pregnant and lactating mothers in Nandurbar district. The
action on behalf of respondent No.1 in declaring that the petitioner does
not qualify at the time of technical bid and respondent Nos.2 and 3 are
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qualified, has been challenged on following grounds :-
(1) The act is illegal and contravening the
procurement rules of Maharashtra government.
(2) Though the petitioner had uploaded all the
documents, they were not properly evaluated and the
documents which were to be uploaded by respondent Nos.2
and 3 were not visible or that facility was disabled. Thus, no
transparency has been ensured.
(3) Bid of respondent Nos.2 and 3 ought to have been
rejected as they were not qualifying or complying with the
tender terms and conditions.
(3A) Respondent Nos.2 and 3 do not have any basic
licence to manufacture or sell the tender products issued from
Indian Food Regulator, namely, FSSAI, which was seen by the
petitioner after search on the official website of FSSAI.
(3B) Udyam certificate of respondent No.2 gives
different activity as major activity of respondent No.2 i.e.
trading, that too not in food articles.
(3C) Respondent No.2 uploaded document claiming
exemption in payment of EMD which was wrong.
(3D) Respondent Nos.2 and 3 do not have past
experience of supply of micronutrient supplement granules.
(3E) The GST documents are not proper.
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(4) Respondent No.1 had failed to appreciate that the
subject matter involves health of young children and pregnant
and lactating mothers and, therefore, ought not to have
accepted the deviations from the terms and conditions, rather
ought to have followed them scrupulously and, therefore, the
petitioner has prayed for issuance of writ against respondent
No.1 for quashing his decision in holding respondent Nos.2 and
3 qualified for the technical and then to the final bid.
Petitioner prays for issuance of writ as against respondent No.1
directing him to accept the petitioner's bid, as the petitioner
complies with all the terms and conditions.
4. The respondents have not filed say, but tendered the documents
across the bar at the time of submissions.
5. Heard learned Senior Counsel Mr. A. S. Khandeparkar instructed by
learned Advocate Mr. R. R. Karpe for the petitioner, learned Advocate Mr. P.
S. Patil for respondent No.1, learned Senior Counsel Mr. V. D. Sapkal
instructed by Mr. S. R. Sapkal for respondent No.2 and learned AGP Mr. V.
M. Jaware for respondent No.4 - State.
6. Learned Senior Counsel Mr. A. S. Khandeparkar instructed by learned
Advocate Mr. R. R. Karpe for the petitioner has taken us through all the
documents produced by the petitioner and especially, the schedule of the
tender, terms and conditions and the documents submitted by the
respondents, which were downloaded from the other websites and he has
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specifically stated that the facility of viewing the documents of respondent
Nos.2 and 3 from the portal which was provided by respondent No.1 was
disabled. By pointing out the technical bid scrutiny chart, he submitted
that except the column stating that whether the terms and conditions have
been fulfilled or not in respect of all the conditions i.e. condition Nos.1 to
14 and 16, the petitioner has been held to be qualified. That means, the
petitioner had uploaded all the documents by complying with the
requirements, still it is held that the petitioner has not complied with the
terms and conditions of the tender. He pointed out term Nos.8 and 9 of the
tender, which reads thus :-
"8½ fufonk/kkjdkus iqjoBk djko;kP;k lkfgR;kpk ,d uequk
o R;klkscr mn~;ksx ÅtkZ o dkexkj foHkkx] ea=ky;
eqacbZ ;kapsdMhy 'kk-fu- fnukad 1 fMlsacj 2016 e/;s ueqn ,u-,-
ch-,y izekf.kr iz;ksx'kkGsP;k rikl.kh vgokykph izr fufonk
Hkj.;kP;k vafre rkj[ksi;Zar dk;kZy;hu dkekps fno'kh ldkGh
11-00 rs lk;adkGh 05-00 oktsi;Zar efgyk o cky fodkl
foHkkx] ftYgk ifj"kn uanqjckj ;sFks izR;{k lknj dj.ks ca/kudkjd
jkghy- lknj dsysyk uequk vko';drsuqlkj 'kklu ekU;rk
izkIr ,u-,-ch-,y- iz;ksx'kkGsrwu rikl.kh dj.;kps vf/kdkj ek-
eq[; dk;Zdkjh vf/kdkjh] ft- i- uanqjckj ;kauk jkgrhy-
9½ fufonsrhy lkfgR;kps iz;ksx'kkGk uequk rikl.kh Qh
lkBh jDde fMekaM&Mªk¶V }kjs] izfr uequk #-14]000@& izek.ks]
ftYgk dk;Zdze vf/kdkjh ¼eckfo½] ftYgk ifj"kn uanqjckj ;k
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ukokus dk<wu efgyk o cky fodkl foHkkx] ftYgk ifj"kn uanqjckj
;sFks le{k lknj djkos-"
English translation of the above-said term Nos.8 and 9
is as under :-
"8. A sample of the materials to be supplied by the
tenderer along with a copy of the NABL certified laboratory
inspection report mentioned in the Government Resolution
dated 1st December, 2016 of Department of Industries, Energy
and Labour, Ministry of Mumbai by 11.00 a.m. in the morning to
05.00 p.m. in the evening on office working days till the last
date of submission of tender. It will be mandatory to submit in
person at Women and Child Development Department, Zilla
Parishad, Nandurbar. The Chief Executive Officer, Zilla Parishad,
Nandurbar reserves the right to examine the submitted sample
from a Government approved NABL laboratory as required.
9. The amount for laboratory sample examination fee of
tender materials through Demand Draft Rs.14,000/- per sample,
drawn in the name of District Program Officer (Women and
Child Development Department), Zilla Parishad, Nandurbar,
presented personally to the Women and Child Development
Department, Zilla Parishad, Nandurbar."
(Translated by Senior Translator and Interpreter,
High Court of Bombay, Bench at Aurangabad)
7. He submitted that the petitioner had complied with term No.9 and
given the demand draft of Rs.28,000/- in respect of two samples. He
further pointed out that in fact the tender that was floated was the third
tender, as the earlier two tender notices could not be taken to the logical
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end. In the second tender, the petitioner was the only bidder who was held
eligible at the technical bid and, therefore, the entire process was required
to be cancelled. The sample which was given and the testing report was
with respondent No.1. Under the said circumstance, it was not necessary
for the petitioner to submit the sample once again. Respondent No.1 was
requested to utilize the same, as the validity/shelf life of the said product,
that was tested earlier as per the certificate issued by the lab, was to expire
in February, 2024. Under the said circumstance, it ought to have been held
by respondent No.1 that the petitioner qualifies.
8. Learned Senior Counsel for the petitioner has then taken us through
the documents of respondent Nos.2 and 3 and submitted that both of them
are not the manufacturers, whereas the petitioner is the manufacturer. The
licence of the petitioner has been pointed out and it is then stated that the
GST registration in respect of respondent No.2 stands in the name of
Narmada Earth Movers and the effective date of registration is 10.10.2018.
In is in a different name and this has been taken by the petitioner from the
website of GST. Respondent No.2 does not stand to the specifications in
respect of food category. The Udyam Registration Certificate of respondent
No.2 shows that the main business of respondent No.2 is in furniture and
the Udyam Registration Certificate of respondent No.3 shows that the main
business of respondent No.3 is in retail trade, except of motor vehicles and
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motorcycles, then retail sale of foods in specialized stores. It is submitted
that since the documents were not uploaded or they were not visible, the
petitioner's right to see the documents of the respondents has been
withheld unnecessarily by respondent No.1. It might be with some mala
fide intention also to allow those persons to comply with the requirements
of the tender.
9. Learned Senior Counsel relied on many decisions of either this Court
or Hon'ble Supreme Court mainly on the point that when the High Court
should interfere in the tender process under its writ jurisdiction. We are
taking note of those decisions, which are as follows :-
(i) Michigan Rubber (India) Limited Vs. State of
Karnataka and others, (2012) 8 Supreme Court Cases
2016.
(ii) Siemens Aktiengeselischaft and Siemens Limited
Vs. Delhi Metro Rail Corporation Limited and others,
(2014) 11 SCC 288.
(iii) Elektron Lighting Systems Private Limited and
Another Vs. Shah Investments Financial Developments and
Consultants Private Limited and others, (2015) 15 SCC
137.
(iv) P. Gopinath Reddy Vs. State of Maharashtra,
Through Department of Urban Development, Mantralaya,
Mumbai and others, [2018 SCC OnLine Bom. 210 : (2018)
2 AIR Bom. R 586]
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(v) Shri. Milan Dhibar Vs. Indian Oil Corporation
Limited and Ors., decided by Calcutta High Court in WPA
No.28643 of 2022 on 22.12.2022.
(vi) Hitech Audio Systems Pvt. Ltd. Vs. State of
Maharashtra Through Principal Secretary Ministry of Public
Works Department and others, 2016 SCC OnLine Bom.
2660 : (2016) 3 Bom. CR 552.
(vii) Inducare Pharma Pvt. Ltd. Vs. Chief Executive
Officer Zilla Parishad Ratnagiri and another, decided by this
Court at Principal Seat in Writ Petition No.11762 of 2023
on 01.11.2023.
(viii) Macpower CNC Machines Limited Vs. Union of
India, Through Development Commissioner, Ministry of
Micro Small and Medium Enterprises (MSME), [2020 SCC
OnLine Del 1801].
(ix) Reliable Facilities Services Private Limited and
Another Vs. Chittaranjan National Cancer Institute and
Others, [2022 SCC OnLine Cal 2850].
(x) Kirvan Vendsol Pvt. Ltd. Vs. The state of
Maharashtra and Ors., decided by this Court in Writ
Petition No.1436 of 2023 on 03.02.2023.
10. In Hitech Audio Systems Pvt. Ltd. (Supra), this Court has reiterated
the importance of transparency. When it was found by this Court in the
facts and circumstances of the said case that the State itself and particularly
the Department of Public Works was not serious in adhering to the terms
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and conditions of the tender, it was observed that the High Court can
interfere, as the departure from the terms and conditions was marked
without producing material to justify such deviation. On the basis of this
decision, it was pointed out on behalf of the petitioner that here also as the
tender documents of respondent Nos.2 and 3 were not visible, it appears
that the action on the part of respondent No.1 lack transparency and the
deviation from its own policy to adhere to all the conditions as are found in
the Government Resolution dated 01.12.2016.
11. When the documents were tendered across the bar, time was given to
the learned Senior Counsel for the petitioner to go through those
documents and make submissions. It was then pointed out that respondent
No.2 is claiming to be the agent or supplier and the manufacturer is one
Nutra Healthcare Pvt. Ltd. By pointing out that the licence is only for the
experts, respondent No.2 cannot be allowed to participate. He, therefore,
canvassed that the bid of the petitioner is strong and the petitioner ought to
have been held to be qualified.
12. Per contra, the learned Advocate for respondent No.1 and learned
Senior Counsel Mr. V. D. Sapkal instructed by Mr. S. R. Sapkal for
respondent No.2 had taken us through the documents filed by respondent
No.2. It was denied that the facility to view the documents of each other
was disabled by respondent No.1. Though a complaint was filed on behalf
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of the petitioner, it appears that it was answered on 22.12.2023 and it is
orally submitted by respondent No.1 that the delay was due to not coming
across such complaint application, as it was on the portal. It has been
stated on behalf of respondent Nos.1 and 2 that respondent No.2 is not the
manufacturer, but the supplier, who can participate in the tender process.
Only condition is that the documents of the manufacturer with whom he
would enter into the agreement or if the manufacturer gives letter of
authorization, then to place the said on the website along with other
documents. Accordingly, the letter of authorization of Nutra Healthcare Pvt.
Ltd. was uploaded. Licence of Nutra Healthcare and the lab testing of the
sample was also uploaded. The GST Registration stands in the name of
respondent No.2 and company by name Narmada Earth Movers might be a
different company or sister company. The Udyam Registration Certificate
of respondent No.2 also shows that it is authorized retail seller of
pharmaceutical and medical goods, cosmetic and toilet articles in
specialized stores. All the documents uploaded by in all five bidders were
considered and scrutinized by respondent No.1 and the Committee.
Therefore, the bidder No.1 i.e. petitioner, bidder Nos.4 and 5 were declared
not eligible. The petitioner had not submitted the sample as required under
the tender condition. Even if it is accepted that the said sample was given
by the petitioner when the earlier tender i.e. similar was floated, but that
entire process has been cancelled and, therefore, the said sample could not
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have been put to use once again. A fresh sample was necessarily to be
tendered when a fresh tender was floated. When the petitioner himself has
been declared not qualified, he cannot raise questions in respect of the
decision of respondent No.1 to hold respondent Nos.2 and 3 as qualified.
13. Learned Senior Counsel for respondent No.2 relied on the decision in
M/s. N.G. Products Limited Vs. M/s. Vinod Kumar Jain and others, [2022
LiveLaw (SC) 302] and submitted that this Court should be slow in
refraining or interfering with the tender process.
14. As aforesaid, the petition is on two counts, firstly to challenge the
petitioners own disqualification and secondly, to challenge the qualification
of respondent Nos.2 and 3. We would like to rely on the observations from
the recent decision by the Hon'ble Supreme Court in M/s. N.G. Products
Limited (Supra), in which the earlier decisions have been taken note of and
it has been observed that :-
"23. In view of the above judgments of this Court, the Writ
Court should refrain itself from imposing its decision over the
decision of the employer as to whether or not to accept the bid
of a tenderer. The court does not have the expertise to examine
the terms and conditions of the present-day economic activities
of the State and this limitation should be kept in view. Courts
should be even more reluctant in interfering with contracts
involving technical issues as there is a requirement of the
necessary expertise to adjudicate upon such issues. The
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approach of the Court should be not to find fault with
magnifying glass in its hands, rather the Court should examine
as to whether the decision-making process is after complying
with the procedure contemplated by the tender conditions. If
the Court finds that there is total arbitrariness or that the tender
has been granted in a mala fide manner, still the Court should
refrain from interfering in the grant of tender but instead
relegate the parties to seek damages for the wrongful exclusion
rather than to injunct the execution of the contract. The
injunction or interference in the tender leads to additional costs
on the state and is also against public interest. Therefore, the
State and its citizens suffer twice, firstly by paying escalation
costs and secondly, by being deprived of the infrastructure for
which they present-day Governments are expected to work."
15. We are aware of the decision in Jagdish Mandal Vs. State of Orissa,
(2007) 14 SCC 517, wherein Hon'ble Supreme Court has held that :-
"22. Judicial review of administrative action is intended to
prevent arbitrariness, irrationality; unreasonableness, bias and
mala fides. Its purpose is to check whether choice or decision is
made "lawfully" and not to check whether choice or decision is
"sound". When the power of judicial review is invoked in
matters relating to tenders or award of contracts, certain special
features should be borne in mind. A contract is a commercial
transaction. Evaluating tenders and awarding contracts are
essentially commercial functions. Principles of equity and
natural justice stay at a distance. If the decision relating to
award of contract is bona fide and is in public interest, courts
will not, in exercise of power of judicial review, interfere even if
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a procedural aberration or error in assessment or prejudice to a
tenderer, is made out. The power of judicial review will not be
permitted to be invoked to protect private interest at the cost of
public interest, or to decide contractual disputes. The tenderer
or contractor with a grievance can always seek damages in a
civil Court. 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";
(ii) Whether public interest is affected.
If the answers are in the negative, there should be no
interference under Article 226. Cases involving blacklisting or
imposition of penal consequences on a tenderer/contractor or
distribution of State largesse (allotment of sites/shops, grant of
licences, dealerships and franchises) stand on a different footing
as they may require a higher degree of fairness in action."
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16. Thus, taking into consideration the well settled law on this point, we
have limited scope. We are to see whether the petitioner has demonstrated
firstly that the petitioner was eligible, as it had complied with all the tender
requirements, then only we can go to the second aspect i.e. challenge by
the petitioner to the decision of respondent No.1 to qualify respondent
Nos.2 and 3 in the technical bid, otherwise the course is open to the
petitioner as aforesaid in M/s. N.G. Projects Limited (Supra) and Jagdish
Mandal (Supra).
17. The petitioner has been disqualified mainly on the ground that he
had not supplied the sample as required under condition No.8. The
petitioner is coming with the case that in the earlier bid, he had supplied
the sample as well as the lab testing report, in which it was indicated that
the validity of the said certificate was till February, 2024. It was the request
of the petitioner to use the said sample and the certificate. Of course, the
said certificate was again uploaded in the present tender process, but the
sample was not handed over, though the fees were paid as per condition
No.9. We are conscious about the fact that in any tender there would be
compulsory terms and conditions and there would be some additional
conditions which may not be termed as compulsory, but the fulfillment of
the same would add to the qualification of a bidder. The terminology that
has been used in term No.8 would show that it was a compulsory term, that
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means it should have been adhered to. As per the schedule, the time to
submit samples was from 10.00 a.m. of 09.10.2023 to 5.00 p.m. of
14.10.2023. When it was a fresh tender and there was absolutely no
stipulation or interpretation of term in the present tender that if any person
would have taken part in the earlier tenders, then he can use the
documents tendered at that time in the fresh process also; in that event, it
was expected that fresh sample should have been given along with a fresh
certificate from the lab regarding the testing of such samples. In other
words, the tender conditions do not support the interpretation tried to be
put by the petitioner that the petitioner was justified in interpreting that
since the shelf life and validity of the certificate was till February, 2024 and
the sample was with respondent No.1, respondent No.1 could have, in his
own discretion, accepted the request of the petitioner. In fact, if this step
would have been taken by respondent No.1, it would have been unjust to
the other bidders. It is not on record as to whether all of the bidders in the
present round had also taken part in the earlier occasions. If the present
bidders had taken part for the first time, then it was expected in the
competition that everything should be fresh. It could also be simply put in
a way that even if all the earlier tender conditions were fulfilled by the
petitioner on the earlier occasion, those tenders were cancelled.
Cancellation had given full stop to everything and, therefore, use of any
document or even a sample cannot be justified. We do not find any
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illegality, error, mala fide or arbitrariness on the part of respondent No.1 in
disqualifying the petitioner in the technical bid on the said count.
18. When we have arrived at the conclusion that the disqualification of
petitioner was justified, it is not necessary for us to consider the other
challenge by the petitioner. Unsuccessful bidder cannot be allowed to
challenge the qualification of other bidders. Under the said circumstance,
the petition fails. No case is made out for the exercise of constitutional
powers by this Court and, therefore, the writ petition stands dismissed.
19. Interim relief granted thus stands vacated.
20. Rule stands discharged.
[ S. G. CHAPALGAONKAR ] [ SMT. VIBHA KANKANWADI ]
JUDGE JUDGE
LATER ON :-
After the pronouncement of Judgment, learned Advocate for the
petitioner prays for continuation of the interim order granted earlier.
In view of the fact that we have already arrived at the conclusion
that the petitioner was not eligible and the fact that the matter is tender
matter where even Hon'ble Supreme Court says that such work should not
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be stayed which are of the public interest, we do not find that any case is
made out for continuation of the interim order. Oral prayer stands rejected.
[ S. G. CHAPALGAONKAR ] [ SMT. VIBHA KANKANWADI ]
JUDGE JUDGE
scm
