Devsaria Iron & Steel Co. Private ... vs The State Of West Bengal And Others
2021 Latest Caselaw 2612 Cal

                        In the High Court at Calcutta
                       Constitutional Writ Jurisdiction
                                Appellate Side

The Hon'ble Justice Sabyasachi Bhattacharyya


                            WPA No.6792 of 2021

           Devsaria Iron & Steel Co. Private Limited and another
                                     Vs.
                   The State of West Bengal and others


For the petitioners                 :    Ms. Rashmi Chopra,
                                         Ms. Tejaswini,
                                         Mr. Avishek Das

For the State-respondent            :    Mr. Washim Ahmed,

Mr. T. A. Khan

For the respondent no.2 : Mr. Sujit Sakan Koley

For the respondent no.3 : Mr. Mainak Bose

For the respondent no.4 : Mr. Srijib Chakraborty, Mr. Jaydeb Ghorai, Mr. Saugata Banerjee

Hearing concluded on : 09.03.2021

Judgment on : 07.04.2021

Sabyasachi Bhattacharyya, J:-

1. The petitioners have challenged an e-auction floated by the respondent-

authorities, through respondent no.4, on February 12, 2021 for sale of de-

commissioned plant and machinery and items of COGP/DPL and Unit-6,

Durgapur Projects Limited. The grievance of the petitioners revolves

around alterations in the terms of the original auction catalogue on

February 10, 2021, whereas the last date for submitting pre-bid security

of Rs.1.5 crore was February 11, 2021. It is argued by learned counsel for

the petitioners that the said alterations, modifying the post-bid conditions

and relaxing those, were substantial in nature. Since the petitioners

could not participate in the auction sale due to the prohibitive post-bid

conditions, such relaxation at the last moment adversely affected the

interests of the petitioners. If the alterations were made sufficiently before

and/or contained in the original conditions, the petitioners would have

participated in the auction.

2. It is submitted that, since there is no separate eligibility criteria in view of

the nature of the auction, the post-bid conditions were a major

determinant of an informed choice to participate in the tender. Since the

petitioners had no option to participate upon having knowledge of the

relaxations granted on the day previous to the last date for submitting

pre-bid security, the petitioners' right to participate was curtailed, in

direct contravention of Article 14 of the Constitution of India.

3. Learned counsel for the petitioner, by placing reliance on the terms of the

e-auction, contends that the inspection date, time and query were fixed

from January 15, 2021 to February 11, 2021 between 9 a.m. to 12 p.m.

and 2 p.m. to 4:30 p.m. on Mondays to Saturdays. However, there was a

clear clause in the conditions that such inspection had to be held by the

bidder with prior appointment with the concerned person from Mjunction

Service Limited, being respondent no.4 herein, two days in advance.

4. In the present case, the material alterations were effected in the conditions

on February 10, 2021, which did not leave clear two days to give advance

notice to the respondent no.4, since the very next date, that is, February

11, 2021, was the last date for such inspection.

5. That apart, the last date of answering any queries from the bidders was

also fixed on February 11, 2021, which opportunity was not available to

the petitioner at all in view of the last-moment alterations in the terms.

6. Learned counsel for the petitioners submits that the respondent-

authorities violated the principle of fair play, which governs all tender

processes, particularly those floated by public authorities.

7. By placing reliance on the relevant CVC guidelines governing such

tenders, in particular Clause 11 of the same, learned counsel appearing

for the petitioners submits that it was recorded in the said clause that it

had been noticed that whenever extension in tender opening is given due

to any reason (like change in scope of work or changes in specifications of

some of the equipments, etc.), the intimation regarding extension is only

to such bidders who had purchased tender documents originally even if

the extension is regarding opening of first bid like pre-qualifications in

case of a single-bid system and techno-commercial bids in case of two-bid

system. By doing so, the competition is restricted to the firms who had

purchased tender documents within the original date of tender sale. The

corrigendum for such extensions is not being published in newspapers.

8. It was further provided in the said clause that, in order to give an equal

opportunity to all the bidders and to maintain the sanctity of tendering

system, it is of paramount importance that any change in the tender

terms and conditions, specifications and tender opening date, etc., be

notified to all the bidders sufficiently in advance of the revised tender

opening date. It was further provided that in case the extension is

regarding submission of first bid like pre-qualification documents in case

of single-bid system and techno-commercial bid in case of two-bid system,

the tender sale date should also be extended suitably so as to allow new

participants in the bid in order to increase the competition.

9. Learned counsel for the petitioner relies on the judgment of Meerut

Development Authority and Ors. Vs. Association of Management Studies

and Ors., reported at (2009) 6 SCC 171, for the proposition that, by way of

judicial review, courts can examine whether the decision-making process

was reasonable, rational, not arbitrary and violative of Article 14 of the

Constitution. It was further observed that no bidder is entitled as a

matter of right to insist the authority inviting tenders to enter into further

negotiations unless the terms and conditions of notice so provided for

such negotiations.

10. It is argued that, in the present case, there was no scope for negotiations,

which prevented the petitioners from participating in the tender process

due to the prohibitive post-bid conditions. Hence, the last-moment

alterations-in-question deprived the petitioners of an equal opportunity

with those who participated in the tender.

11. Learned counsel next relies on a Single Bench judgment of this Court in

Aroni Tubes Private Limited Vs. West Bengal Agro Industries Corporation

Limited and Ors. reported at MANU/WB/0103/2021, in support of the

proposition that the terms of a tender can be open to judicial scrutiny if it

is established that the terms of the tender were so tailor-made as to suit

the conveyance of any particular person with a view to eliminate all others

from participating in the bidding process.

12. It is, thus, submitted that the impugned tender ought to be set aside.

13. Learned counsel for respondent no.3 submits that only the participants

in the tender process could have been affected by an alteration in the

post-bid conditions.

14. The respondents contend that there is no question of the eligibility to

participate being affected by the alterations-in-question. As such, nothing

prevented the petitioner from participating in the tender and taking an

inspection of the concerned site.

15. It is further argued by the respondents that the alterations only

pertained to specifications being provided regarding the structures on the

location of the plant which was to be de-commissioned and within the

purview of the original terms of the auction. Hence, there was no material

alteration which could affect the interest of the petitioners, who did not

participate in the tender at all.

16. Upon hearing learned counsel for the contesting parties, what stares at

the face is the non-participation of the petitioners in the tender process.

The petitioners could have taken an inspection with sufficient notice as

contemplated in the auction conditions, and could have sought for pre-bid

clarifications at any point of time, irrespective of the alterations brought in

on February 10, 2021.

17. Since the petitioners did not participate in the tender process at all,

relaxation of the post-bid conditions could not have affected the

petitioners in any manner. In the absence of any challenge to the

alterations by any of the several other participants apart from the

successful bidder, it cannot be said that the petitioners could benefit even

indirectly from the alterations.

18. The tender process was not tainted by patent mala fides and/or

arbitrariness or tailor-made to suit the needs of a particular person or

persons. It is only the successful bidder who could have got the benefit of

relaxation regarding payments.

19. As regards the insertion of specifications of the structures lying at the

location of the de-commissioning, only further details were provide in the

alterations, which would have been evident to the petitioners in the event

the petitioners participated and had an inspection. The time for

inspection was given from January 15, 2021 to February 11, 2021,

thereby providing sufficient opportunity to the participants to have an

inspection and decide on their prospects in the tender. Such an

inspection would also furnish an opportunity to the petitioners, even as

per the auction conditions, to make any query regarding the sale or

bidding process before February 10, 2021. In the absence of such

participation, the petitioners can only be labelled as fence-sitters seeking

to take advantage of the belated alterations, despite having chosen not to

participate in the tender at all.

20. As far as the CVC guidelines relied on by the petitioners are concerned,

those are of a directory nature. That apart, the illustrations given in the

alterations contemplated in Clause 11 of the guidelines clearly indicate

that the same pertains to tenders requiring some work to be done by the

participants and/or any pre-qualification eligibility being affected by such

alteration. In the present case, however, there was no question of any

pre-qualification eligibility criteria, since the auction was floated only for

the purpose of sale of the plant and machinery items of the Durgapur

Projects Limited on an "as is where" and "no complaint and complete

clearing of site" basis with sufficient prior opportunity for taking

inspection and making queries by the participants. Hence, the guidelines

relied on by the petitioners cannot have a direct bearing on the impugned

e-auction, due to its very nature.

21. There arose no question of any pre-eligibility criterion being satisfied

prior to participation in the bid. Only participants in the tender could

invoke Article 14 of the Constitution of India against successful bidders, if

at all, since the other participants in the tender process were on a similar

footing as the successful bidder, to whom the post-bid relaxation applied.

Since the petitioners did not participate at all, the mere technical objection

that they could have so participated in the event the petitioners had prior

knowledge of the relaxations, is a flimsy ground to set aside the e-auction

as a whole.

22. That apart, the relaxation of post-bid conditions is well within the

discretion of the tender-issuing authority. Thus, in the absence of any

arbitrariness, mala fides or violation of Article 14 of the Constitution of

India and/or any prima facie material to show that the tender terms were

altered in a tailor-made manner to suit the convenience of any particular

person, even adhering to the principles laid down in the judgments cited

by the petitioners, there is no scope for judicial interference in the

impugned e-auction.

23. Although it was laid down in Meerut Development (supra) that the

methods to be adopted for disposal of public property must be fair and

transparent, providing an opportunity to all the interested persons to

participate in the process, in the present case there was no lack of

transparency in the methods in view of sufficient opportunity of inspection

and prior queries having been provided. The petitioners willingly chose

not to participate in the tender. The determinant standards for all who

participated were the same, as per the conditions as those stood prior to

the impugned alterations. The material alterations, if any, merely

pertained to relaxation of post-bid terms for the successful bidder and did

not touch the eligibility to participate in the tender at all.

24. As far as the other alteration was concerned, the same only specified the

structures which fell within the scope of the sale-in-question. At best,

such specific enumerations of the structures could benefit the participants

who, in any event, have had the opportunity to inspect the property.

25. Thus, the ratio laid down in the judgments cited by the petitioners is not

applicable to the present case at all.

26. In view of the above observations, there is no occasion for judicial

interference under Article 226 of the Constitution of India to interdict

and/or set aside the tender impugned in the present writ petition.

27. Accordingly, WPA No.6792 of 2021 is dismissed on contest, without any

order as to costs.

28. Urgent certified copies, if applied for, be supplied to the parties upon due

compliance of all requisite formalities.

( Sabyasachi Bhattacharyya, J. )