Calcutta High Court (Appellete Side)

Sandip Halder & Ors vs The State Of West Bengal & Ors on 28 September, 2021

         IN THE HIGH COURT AT CALCUTTA
                CONSTITUTIONAL WRIT JURISDICITON
                         APPELLATE SIDE

Present:

The Hon'ble Justice Shivakant Prasad

                        W.P.A. 15088 of 2021
                       Sandip Halder & Ors.
                                 Vs.
                   The State of West Bengal & Ors.

For the Petitioners             : Mr. Saptangsu Basu
                                  Mr. Swarup Paul
                                  Mr. Surya Maity
                                  Ms. Amirta Maji
                                  Ms. Mrinalini Majumder

For the State                   : Mr. Samrat Sen
                                 Mr. Anirban Roy
                                 Mr. Sirsanya Bandyopadhyay
                                 Mr. Tapas Ballav Mondal
                                 Mr. Arka Kumar Nag


Heard on                        : 28.09.2021

Judgment on                     : 28.09.2021

Shivakant Prasad, J:-

      Petitioners' case in brief is that the respondent no. 6 has invited

impugned e-Tender process second call under two bid system for hiring

of reputed agency/contractor for supply of cooked diet for the indoor

patients of ESI Hospital, Kamarhati under Memo No. ESIK/1413/NIT-

25/Diet/2020-21 dated 26.08.2021 by violating revised norms of

inviting e-Tender process second call as per Memo No. 925-F(Y) dated

the 14th of February, 2017, introducing much restrictive terms and

conditions for participation than the first call for which petitioners are

unable to participate in the said tender process second call

notwithstanding they have participated in the first call. Last date of

submission of said tender was as on 24.09.2021.

The writ petitioners have sought for direction to cancel the

impugned e-Tender process for supply of cooked diet for the indoor

patients of E.S.I. Hospital, Kamarhati initiated under Memo No.

ESIK/1413/NIT-25/Diet/2020-21 dated 26.08.2021 issue for

direction to invite fresh e-Tender process by deleting the purported

terms and conditions mentioned in Clause - 1b and 1c of the tender

process and further sought for an interim order of injunction upon the

respondent no. 6 and his subordinates to forbear them from giving any

effect to the said tender being, 'Annexure - P/11' to the writ application

vide notice inviting e-Tender for supply of cooked diet for the indoor

patients of ESI Hospital, Kamarhati.

Mr. Saptangsu Basu, learned senior counsel for the petitioners at

the outset invites my attention to 'Annexure P/6' at page 83 of the writ

application dated 17.05.2021 under Memo No. ESIK/500/NIT-

25/Diet/20-21 to submit that the invitation to e-Tender two bid system

for the supply of Diet for the Indoor patients of ESI Hospital, Kamarhati

was issued by the respondent no. 5 and in respect of technical bid and

price bid the agencies for supply of the Diet for the Indoor patients of

ESI Hospital, Kamarhati, the petitioners participated in response to the

e-Tender wherein the qualification condition to be an eligible tender in

respect of the technical bid. Now, the petitioners invite my attention to

'Annexure- P/9' and contended that the case of the petitioner no. 2 and

4 were accepted with other bidders but the case of the petitioner no. 1

and 5 was rejected as they could not satisfy their qualification for such

bid to be offered as the food license certificate by the Government

(F.S.S.A.I.) was not provided and there was no credential submitted to

show their essential qualification to participate for the e-Tender in

terms of the tender notice dated 17.05.2021.

Mr. Samrat Sen, learned counsel for the State submits that case

of the petitioner nos. 1 and 5 was accepted. It is also pointed out that

the petitioner no. 3 has not participated in response thereto. Therefore,

in respect of the evaluation relating to technical bid the respondent

authority cannot be blamed. However, the case of the petitioner nos. 2

and 4 can be taken into consideration as their offer was accepted.

Mr. Basu, learned senior counsel appearing for the petitioners

has filed supplementary affidavit to challenge the submission that the

tender being the second call cannot be accepted as the revocation of the

earlier tender and cancellation vide order dated 22.07.2021 is without

assigning any reason whatsoever but such fact was not pleaded in the

writ petition and there was inadvertent mistake in not pleading the fact

relating to cancellation of the tender which prejudicially affects the right

of the technically selected bidders of the said tender. It is submitted

that even considering the cancellation order as a valid one, the criteria

laid down for the participation of second call of said tender process is

oppressive and the intending tenderer who were allowed to participate

in the earlier tender first call has been denied participation in the

second call and, as such, restriction is contrary to the norms laid down

for a second call by a tender as per Memo No. 925-F(Y) dated 14 th

February, 2017.

In this context, learned counsel for the State submits that the

scope of the writ application cannot be enlarged by way of

supplementary affidavit and to support his contention, relied on a

decision in Bharat Bhari Udyog Nigam Ltd. Vs. Jessop & Co.

Ltd. Staff reported in (2003) 4 Comp LJ 333 Cal. adverting to

observation at para 23 wherein it has been observed that the parties

cannot be permitted to travel beyond their pleadings and make out a

new case on the basis of supplementary affidavits and if this kind of

procedure is adopted, then the value of pleadings will have no meaning;

and it is likely to prejudice the parties as they may be misled because of

the piecemeal presentation of facts by supplementary affidavits filed in

the proceedings. Normally, whenever a major issue arises during the

proceedings and there are no proper pleadings - then parties have to be

restricted to their pleadings and they should not travel beyond that.

Having heard in Mr. Sen, in my considered view the

supplementary affidavit filed this day does not make out any different

case divorced from moot issue as the petitioners wherein the petitioners

have sought for certain direction not to give effect to the e-Tender

second call as the condition provided therein is restrictive in its nature

in the sense that in the first tender one of the qualifications for the

Bidder was that he should be experienced for three years in rendering

service in supply of cooked food to the patients in a hospital, whereas

the essential qualification appears to be more restrictive for seeking five

years experience in the said field in the second call e-Tender. This is

what is the main challenge in the writ application.

Now, it would be apt to take note of the criteria provided in the e-

Tender second call under the heading terms and conditions at page 111

which provides minimum average annual financial turnover of Rs.

40,00,000/- in the last 03 financial years and credential of providing

cooked diet in any ESIS/ESIC Hospital in India having 200 beds or

above, continuously for at least 05(five) years whereas, in the e-Tender

first call, qualifying condition to be an eligible Bidder for Technical Bid

is that the intending tenderers must have credential for some work for

at least three years in a big hospital with 250 beds capacity. So, the

purported terms and conditions in Clause 1b has been sought to be

deleted and to invite fresh e-Tender as the period of 05 years mentioned

in Clause 1b as the service rendered after April, 2011 as the terms and

conditions for intending bidder embodied in the second e-Tender

adversely affects the petitioners as they are not qualified having

experience of providing service in the area for five years after April 2011

and hence, the petitioners' claim that they would be deprived of

participating in the second e-Tender with the restrictive Clause.

Mr. Basu points out that the e-Tender can be called as per the

Government directives vide 'Annexure - P/12' providing revised norms

for acceptance of L1/H1 bid/Single bid when the number of qualified

bidders during second call is less than 3. My attention is invited to the

said Memorandum of the Government dated 14.02.2017 under

Notification No. 925-F(Y) of the Government of West Bengal, Finance

Department, Audit Branch which provides that in case of second call, if

any, the eligibility criteria and other terms and conditions as contained

in the first 'Notice Inviting Tender' are required to be reviewed by the

Tender Inviting Authority to ascertain whether it was too much

restrictive, specifications and qualifications were fixed at higher

standard than required.

It is in this context, Mr. Basu submits that the first tender

condition was not restrictive insofar as the specification and

qualification fixed at higher standard than required rather the e-Tender

second call, embodies such restrictive conditions which really debars

the petitioners to participate in response to the second call vide second

Notification for e-Tender by the respondent authority.

My attention is drawn to 'Annexure - P/10' at page 109 relating

to Corrigendum in reference to the earlier Tender No. ESIK/500/NIT-

25/Diet/20-21 which reflects the order passed by the Superintendent,

E.S.I. Hospital, Kamarhati, Kolkata dated 22.07.2021 that revocation of

the tender was done due to technical reasons. The order so passed is

undoubtedly without assigning any plausible reason and is not

convincing to the judicial mind as to what was the technical reasons

which compelled the authority to revoke the tender when the same

authority had accepted the names of successful bidders after technical

evaluation pertaining e-Tender ESIK/500/NIT-25/Diet/20-21 as

mentioned at page 108 of the writ application. It shows as many as

eight bidders were accepted after technical evaluation of e-Tender. So,

this Court does not find any reason for cancelling or revocation of the

earlier tender on the ground of technical reason. That apart, it is

understood in conjoint reading with the second call e-Tender and the

Government directives that the conditions for the qualification in the

first tender was not restrictive rather the restrictive conditions in

respect of the qualification for the bidders is more stringent in the

second call. Therefore, there was no justification even for calling

second e-Tender in violation of the Government circular.

Mr. Sen, learned counsel for the State relied on a decision in

Kaveri Labour Contract and Multipurpose Cooperative Society

Ltd. Vs. Chief Secretary reported in 2008 SCC Online Cal. 753

(2009) 2 ICC 222 (Cal.) and submits that merely by participating in

the tender process, getting invitation to participate in the meeting

arranged for negotiation of rates and even by emerging as the lowest

bidder, if the petitioner's claim is to be accepted as true, the petitioner

did not acquire any right to get the work order which only could be the

logical conclusion of the process. The authority initiating the process

was quite competent to cancel it at any stage before acceptance of the

work order, if any, issued in favour of the petitioner. For cancelling the

tender process the authority was not under any obligation to disclose

any reason. The tender process is presumed to be cancelled in public

interest, unless it is alleged and demonstrated by the petitioner that it

was cancelled for some extraneous reasons.

Mr. Sen, learned counsel for the respondent/State also relied on

a decision in the case of Maa Binda Express Carrier & Another Vs.

North-East Frontier Railway & Ors. reported in (2014) 3 SCC

760 at para 8 to contend that State or its agencies are not obliged to

accept the petitioners even as consideration that they participated in

the first e-Tender.

"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."

Thus, it is submitted by Mr. Sen that the respondent authority

even can cancel or revoke the e-Tender earlier issued without assigning

any reason. In my respectful consideration, the ratio decided in the

cited case is not within the facts and circumstances of the instant case

inasmuch as cited decision is in respect of tender regarding highest or

lowest bidder and in my judicial wisdom, term in the e-Tender relating

to cancellation without assigning any reason is not just as the

respondent authority is answerable to the public at large otherwise the

action taken on behalf of the respondent authority would be opaque. It

is for the authority to accept or not to accept in the interest of the

public and the authority notice inviting tender can enter into

negotiation or grant relaxation for bona fide and cogent reasons

provided such relaxation is permissible under the terms and conditions

governing the tender process.

I have considered the submissions in reference to above cited

decisions but I differ, in my view, having regard to the facts of the case

as discussed above that the authority revoked the first tender even after

accepting of some of the petitioners on technical evaluation without

considering the directives of Ministry of Finance (Audit Department).

Therefore, as per the norms, e-Tender second call is not justified when

the second call is not for relaxation of the restrictive clauses relating to

the qualifications for the bidder to participate in the e-Tender.

As I have discussed in the foregoing paragraphs that the Ministry

of Finance, Audit Department has provided directives governing the

tender process concerning e-Tender second call, that it can call, only if

the conditions and the terms in the first tender appears to be restrictive

and not otherwise. But, at the same time, this Court takes note of

observation in para 9 of the cited decision in Maa Binda Express

Carrier (supra) which reads thus:-

"Suffice it to say that in the matter of award of contracts the

Government and its agencies have to act reasonably and

fairly at all points of time. To that extent the tenderer has an

enforceable right in the court which is, competent to examine

whether the aggrieved party has been treated unfairly or

discriminated against to the detriment of public interest. (See.

Meerut Development Authority v. Assn. Of Management

Studies and Air India Ltd. v. Cochin International Airport

Ltd.)."

Therefore, it is well-understood that the Court is competent to

examine the tenderer enforceable right whether the aggrieved party has

been treated unfairly or discriminated against to the detriment of the

public interest. This Court has observed that retaining second call

tender on revocation of earlier tender would deprive at least the

petitioner nos. 2 and 4 whose case was clear for acceptance of their bid

on the basis of technical evaluation. However, they do not bear

essential qualification of providing service for five years in the field of

supply of cooked diet for the patients and so they would not be eligible

to participate in the e-Tender second call. So, obviously having regard

to the terms of the Government norms the petitioner nos. 2 and 4 have

their right for enforcement and scrutiny by the Court.

For the reasons above, Mr. Basu, learned senior counsel for the

petitioners has placed reliance in the case of Berhampore

Construction Syndicate Private Limited and Another Vs. The

State of West Bengal and Others in F.M.A. 1416 of 2017 with

CAN 6546 of 2017; wherein the Division Bench of this Hon'ble Court

observed that since the act of cancellation of the tender process by the

department cannot be accepted as no reason was furnished. Therefore,

the petitioners' bid be revived for the department to take cognizance

thereof and to act accordingly.

Mr. Basu also relies on a decision in the case of Union of India

& Ors. Vs. Dinesh Engineering Corporation & Anr. reported in

(2001) 8 SCC 491 and the observation made at paragraph 15 which

reads thus:-

"15. Coming to the second question involved in these appeals,

namely, the rejection of the tender of the writ petitioner, it was

argued on behalf of the appellants that the Railways under

clause 16 of the Guidelines was entitled to reject any tender

offer without assigning any reasons and it also has the power

to accept or not to accept the lowest offer. We do not dispute

this power provided the same is exercised within the realm of

the object for which this clause is incorporated. This does not

give an arbitrary power to the Railways to reject the bid

offered by a party merely because it has that power. This is a

power which can be exercised on the existence of certain

conditions which in the opinion of the Railways are not in the

interest of the Railways to accept the offer. No such ground

has been taken when the writ petitioner's tender was rejected.

Therefore, we agree with the High Court that it is not open to

the Railways to rely upon this clause in the Guidelines to

reject any or every offer that may be made by the writ

petitioner while responding to a tender that may be called for

supply of spare parts by the Railways. Mr. Iyer, learned

Senior Counsel appearing for EDC drew our attention to a

judgment of this Court in Sterling Computers Ltd. v. M & N

Publications Ltd. which has held: (SCC p. 455, para 12].

"Under some special circumstances a discretion has to be

conceded to the authorities who have to enter into contract

giving them liberty to assess the overall situation for purpose of

taking a decision as to whom the contract be awarded and at

what terms. If the decisions have been taken in bona fide

manner although not strictly following the norms laid down by

the courts, such decisions are upheld on the principle laid down

by Justice Holmes, that courts while judging the constitutional

validity of executive decisions must grant certain measure of

freedom of 'play in the joints' to the executive."