Bombay High Court
Ms D M Gaikwad Construction Through Its ... vs The State Of Maharashtra Through Its ... on 7 October, 2024
Author: Mangesh S. Patil
Bench: Mangesh S. Patil
2024:BHC-AUG:25315-DB
135.WP-2399-2024.odt
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
Writ Petition No. 2399 Of 2024
M/s D.M. Gaikwad Constructions
Having its office at Gangasadan, Poonam Galli,
Raviwar Peth, Beed, Tq. & Dist. Beed.
Through its Proprietor,
Dayanand Machindra Gaikwad
Age: 35 years, Occu.: Contractor. .. Petitioner
Versus
1. The State of Maharashtra,
Through its Secretary,
Department of Agriculture & Marketing,
Mantralaya, Mumbai.
2. The Chairman and Managing Director,
Maharashtra State Warehousing Corporation,
583/B Market Yard, Gultekadi, Pune,
Dist. Pune.
3. The General Manager (Engineering),
Maharashtra State Warehousing Corporation,
583/B Market Yard, Gultekadi, Pune,
Dist. Pune. .. Respondents
*****
* Mr. S.V. Natu h/f Mr. M.D. Narwadkar,
Advocate for the Petitioner.
* Mrs. P.J. Bharad, AGP for Respondent No.1/State.
* Mr. Kunal Kale, Advocate for Respondent Nos. 2 & 3.
*****
CORAM : MANGESH S. PATIL &
SHAILESH P. BRAHME, JJ..
DATE : 07 OCTOBER 2024
[1]
135.WP-2399-2024.odt
ORAL JUDGMENT (Per Shailesh P. Brahme, J.) :
. Rule. Rule is made returnable forthwith. Heard both the
sides finally with their consent.
2. Petitioner, a registered Contractor, has initially filed this
petition seeking direction to delete/modify tender conditions and
for prohibitory directions. Later on the petition is amended and
additionally relief of quashment of communication dated
12.03.2024 disqualifying the petitioner in the technical
evaluation and order restraining to issue tender work to
successful bidders have been solicited.
3. A tender was floated by the respondent no.2/Warehousing
Corporation bearing e-tender notice 53/23-24 for replacement of
old A.C. Sheets by Zincalume Sheets of various warehouses
situated in Latur, Chattrapati Sambhajinagar, Pune, Nashik,
Amravati and Nagpur MIDC Region. The petitioner submitted its
bid. The pre-bid meeting was conducted on 21.02.2024.
Petitioner raised objections in the pre-bid meeting. The
objections were overruled. The technical evaluation of the bids
were conducted. It was called upon to remove the shortfalls in
the bid document by email dated 09.03.2024. It made the
compliance and reported it on 11.03.2024. It was disqualified in
the technical bid on 12.03.2024 as non-responsive to condition
of folder nos.4(a), 6 and 7.
4. Learned Counsel Mr. S.V. Natu for the petitioner submits
that the tender condition nos. 4(a), 6 and 7 are arbitrary and
designed to restrict the competition. He further submits that the
135.WP-2399-2024.odt
disqualification is perverse and illegal as the eligibility conditions
were complied with. It is further submitted that for last ten
years, petitioner was executing work of the
respondent/Corporation and the documents to that effect were
submitted. The insistence for experience certificate was hyper
technical. The petitioner was not issued with the experience
certificate in time. He was holding requisite documents to show
ownership of machines, but still it is disqualified.
5. The respondents contest the submission of the learned
Counsel for the petitioner. Affidavit-in-reply is filed by the
respondent no.2 and 3. It is submitted that petitioner's
objections raised in the pre-bid meeting were overruled and it is
again agitating the same after participating in the tender
process. For each tender work, the bids were received which are
stated in paragraph no.9 of the reply. The technical assessment
has been reiterated in the reply. The petitioner was found to be
non-responsive for folder nos.4(a), 6 and 7 for tender no.53/1. It
was found to be non-responsive for tender no.53/2 to the extent
of folder nos.4(a), 6 and 7. It was non-responsive for tender
no.53/4 to the extent of folder no.4(a).
6. It is further submitted that it failed to submit proof of being
a profile manufacturer of sheets. There was no proof of
ownership of standing seam machine. Despite giving opportunity
to it to remove the shortfalls, requisite documents were not
placed on record. It is further contended that experience
certificate could have been solicited before submitting tender.
135.WP-2399-2024.odt
After following due procedure of law, in a technical evaluation
petitioner was disqualified. Lastly, it is contended that there is no
procedural impropriety or arbitrariness in the decision making
process and the petition is liable to be dismissed.
7. The respondent no.1 adopts the stand taken by the
respondent no.2 and 3.
8. We have considered the rival submissions of the parties.
9. The petitioner is challenging eligibility conditions folder nos.
4(a), 6 and 7 which are as follows :
"4(a). Bidder should be a profile manufacturer of sheets and have his own
standing seam machine, required proof to be attached.
6. Work Done Certificate of Govt./semi Govt. sector & Private Sector (private
work) Certificate issue by the head of officer not below the rank of Executive
Engineer/ Architect should be provided and contractor has to submit
documentary evidence C.A. certificate of work done/ work completed
certificate i.e. scanned copy of agreement, bill copies of work done,
commencement certificate, Form 26 AS of Income Tax. Satisfactory completed
as a prime contractor for similar type of roofing work from 2018-19 to 2022-
23 as follows.
1. Three Zincalume/CGI sheet roofing works having workwise cost of work not
less than 40% of Tender cost at price level 2022-23.
2. Two Zincalume/CGI sheet roofing works having workwise cost of work not
less than 60% of Tender cost at price level 2022-23.
3. One Zincalume/CGI sheet roofing works having workwise cost of work not
less than 80% of Tender cost at price level 2022-23.
7. Executed in any one year of last five years from 2018-19 to 2022-23, the
minimum quantities of the following items of work as indicated in Appendix.
Sr.No Items Quantity
1. Zincalume/CGI sheet roofing or 30% of Tender
equivalent type of sheet roofing quantity in Square
Meter
135.WP-2399-2024.odt
10. The petitioner participated in the tender process and
submitted to the tender conditions including the impugned
conditions. In a pre-bid meeting, various objections were also
raised. Those were considered by the tendering authority. Those
were overruled on 22.02.2024. The tender condition contained in
folder no.4(a) was specifically challenged and overruled. The
petitioner could have challenged tender condition no.6 and 7, but
for the reasons best known to him no challenge was put up.
Having participated in the tender process and having suffered
overruling of objection to tender conditions no.4(a), he is
estopped from challenging the conditions in question by filing
present petition.
11. It would be prerogative of the tendering authority to fix the
tender conditions. It is open for the tendering authority to modify
or deviate from any tender condition which was existing in the
earlier tender process. The tendering authority is the best Judge
to select the conditions to suit its purpose. In writ jurisdiction,
the conditions cannot be substituted or modified just on the
ground of hardship to any party or inconvenience. It is clearly
laid down in following paragraph of Supreme Court in Airport
Authority of India Vs. Centre for Aviation Policy, Safety &
Research (CAPSR) & Others; A.I.R. 2022 Supreme Court 4742.
"6. Even otherwise, even on merits also, the High Court has erred in quashing
and setting aside the eligibility criteria/tender conditions mentioned in the
respective RFPs, while exercising the powers under Article 226 of the
Constitution of India. As per the settled position of law, the terms and
conditions of the Invitation to Tender are within the domain of the
tenderer/tender making authority and are not open to judicial scrutiny, unless
they are arbitrary, discriminatory or mala fide. As per the settled position of
law, the terms of the Invitation to Tender are not open to judicial scrutiny, the
same being in the realm of contract. The Government/tenderer/tender making
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authority must have a free hand in setting the terms of the tender.
7. While considering the scope and ambit of the High Court under Article 226
of the Constitution of India with respect to judicial scrutiny of the eligibility
criteria/tender conditions, few decisions of this Court are required to be
referred to, which are as under:
In the case of Maa Binda Express Carrier (supra), in paragraph 8, this Court
observed and held as under:
"8. The scope of judicial review in matters relating to award of contracts by
the State and its instrumentalities is settled by a long line of decisions of this
Court. While these decisions clearly recognise that power exercised by the
Government and its instrumentalities in regard to allotment of contract is
subject to judicial review at the instance of an aggrieved party, submission of a
tender in response to a notice inviting such tenders is no more than making an
offer which the State or its agencies are under no obligation to accept. The
bidders participating in the tender process cannot, therefore, insist that their
tenders should be accepted simply because a given tender is the highest or
lowest depending upon whether the contract is for sale of public property or
for execution of works on behalf of the Government. All that participating
bidders are entitled to is a fair, equal and non-discriminatory treatment in the
matter of evaluation of their tenders. It is also fairly well settled that award
of a contract is essentially a commercial transaction which must be determined
on the basis of consideration that are relevant to such commercial decision.
This implies that terms subject to which tenders are invited are not open to
the judicial scrutiny unless it is found that the same have been tailor-made to
benefit any particular tenderer or class of tenderers. So also, the authority
inviting tenders can enter into negotiations or grant relaxation for bona fide
and cogent reasons provided such relaxation is permissible under the terms
governing the tender process."
In the case of Michigan Rubber (India) Ltd. (supra), after considering the law
on the judicial scrutiny with respect to tender conditions, ultimately it is
concluded in paragraph 23 as under:
"23. From the above decisions, the following principles emerge:
(a) The basic requirement of Article 14 is fairness in action by the State, and
non-arbitrariness in essence and substance is the heartbeat of fair play. These
actions are amenable to the judicial review only to the extent that the State
must act validly for a discernible reason and not whimsically for any ulterior
purpose. If the State acts within the bounds of reasonableness, it would be
legitimate to take into consideration the national priorities;
(b) Fixation of a value of the tender is entirely within the purview of the
executive and the courts hardly have any role to play in this process except
for striking down such action of the executive as is proved to be arbitrary or
unreasonable. If the Government acts in conformity with certain healthy
standards and norms such as awarding of contracts by inviting tenders, in those
circumstances, the interference by courts is very limited;
135.WP-2399-2024.odt
(c) In the matter of formulating conditions of a tender document and awarding
a contract, greater latitude is required to be conceded to the State authorities
unless the action of the tendering authority is found to be malicious and a
misuse of its statutory powers, interference by courts is not warranted;
(d) Certain preconditions or qualifications for tenders have to be laid down to
ensure that the contractor has the capacity and the resources to successfully
execute the work; and
(e) If the State or its instrumentalities act reasonably, fairly and in public
interest in awarding contract, here again, interference by court is very
restrictive since no person can claim a fundamental right to carry on business
with the Government."
In the aforesaid decision, it is further observed that the Government
and their undertakings must have a free hand in setting terms of the tender
and only if it is arbitrary, discriminatory, mala fide or actuated by bias, the
courts would interfere. It is further observed that the courts cannot interfere
with the terms of the tender prescribed by the Government because it feels
that some other terms in the tender would have been fair, wiser or logical.
Similar views have been expressed in the case of Educomp Datamatics
Ltd. (supra) and Meerut Development Authority (supra).
12. It is laid down by the Supreme Court in paragraph no.23 of
judgment in the matter of N.G. Projects Limited Vs. M/S. Vinod
Kumar Jain & Ors., 2022 LiveLaw (SC) 302, as follows :
"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 ex-pertise to adjudicate upon such
issues. The 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 com- plying 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 malafide 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 the present-day Governments are
expected to work."
135.WP-2399-2024.odt
13. We do not find that a case is made out by the petitioner
that the impugned conditions are against statutory provisions or
violative of principles of level playing field. Neither are we
convinced that those are arbitrary and designed mala fide to
reduce the competition. We are not in agreement in the
submissions advanced by the learned Counsel for the petitioner.
The writ petition is dismissed. Rule is discharged.
[ SHAILESH P. BRAHME ] [ MANGESH S. PATIL ]
JUDGE JUDGE
najeeb..
