Calcutta High Court (Appellete Side)
Shiba Prosad Banerjee vs The State Of West Bengal And Others on 9 June, 2023
9th June,
2023
(AK)
38
W.P.A 13404 of 2023
Shiba Prosad Banerjee
Vs.
The State of West Bengal and others
Mr. Swarup Paul
Mr. Surya Maity
Mr. Anirban Chakraborty
Mr. Gurusaday Dutta
Mr. Anish Roy
...for the petitioner.
Mr. Santanu Kr. Mitra
Mr. Prantik Garai
...for the State.
Mr. N.C. Bihani
Mr. P.B. Bihani
...for the West Bengal Pollution Control
Board.
The petitioner has challenged a tender document
primarily on the ground of arbitrariness and that
particular clauses of the same are tailor-made to suit
certain particular operators.
Learned counsel for the petitioner contends that
the tender, which is floated for the purpose of house-
keeping job under the West Bengal Pollution Control
Board, stipulates that such house-keeping jobs would be
for nine offices of the Board.
Such offices are distributed all over West Bengal.
2
However, in Serial No.7 of the eligibility criteria, the
tender document provides that the office location of the
bidder must be in Kolkata, West Bengal.
The exact phrase used is "the bidder must have an
office in Kolkata, West Bengal".
It is further argued that in Serial No. 2 of the said
criteria, the credential of the bidders have been stipulated
to be three numbers of credential/contract for last three
years regarding similar type of work for at least twenty
five number of sweeping personnel deployed under one
organization like Central Government/State
Government/Autonomous Body/PSU.
It is argued that one person may very well have the
requisite strength of personnel for deployment in the
several offices for which the tender is floated and it is not
necessary that the person has to have credentials
regarding three separate similar types of works, that too
under the same organization.
Learned counsel for the petitioner places reliance
on an unreported coordinate Bench judgment dated May
12, 2023 passed in WPA 11519 of 2023 (M/s Rupa
Enterprises vs. State of West Bengal).
In the said judgment, the learned Single Judge,
while dealing with a similar clause, was pleased to set
aside the tender on the ground of the clause being
unreasonable.
3
Learned counsel appearing for the respondent
nos.2 to 4 controverts the contentions of the petitioner
and places reliance on Silppi Constructions Contractors
Vs. Union of India reported at (2020) 16 SCC 489. In the
said judgment, it was held, inter-alia, that the court is
duty bound to interfere when there is arbitrariness,
irrationality, mala fides and bias.
However, the court is normally loathe to interfere in
contractual matters unless a clear-cut case of
arbitrariness or mala fides etc. is made out.
It is also submitted that there must be a public
element involved and that the courts have to give a fair
play in the joints to the Government and Public Sector
undertakings in matters of contract.
It is submitted that the Supreme Court went on to
observe that the essence of law laid down in judgments
referred therein is that the exercise of restraint and
caution is essential and the need for overwhelming public
interest is required to justify judicial intervention.
In similar context, learned counsel for the
respondent nos.2 to 4 cites Michigan Rubber (India)
Limited Vs. State of Karnataka reported at (2012) 8 SCC
216 and a Division Bench judgment of this court
rendered in Renesco India Pvt. Ltd. Vs. Eastern Coalfields
Limited and others.
On the other hand, learned counsel for the State
cites the judgments reported at (2022) 6 SCC 127 ( N.G.
Projects Limited vs. Vinod Kumar Jain and others and
(2022) 5 SCC 362 (Agmatel India Private Limited vs.
Resoursys Telecom and others).
It is contended by learned counsel for the State that
the bidder cannot dictate the terms of the tender. What is
an essential term in the contract is to be left to the
decision of the employer.
Mere technical violations, in the absence of any
patent arbitrariness or intended mala fides, cannot call
for judicial interference, it is argued.
Upon hearing learned counsel for the parties, a
scrutiny of the relevant clauses gains vital importance.
Insofar as serial no.7 of the tender document is
concerned, the office location of the bidder has been
stipulated to be in Kolkata, West Bengal. The clause
provides that the bidder "must" have an office in Kolkata,
West Bengal.
Such a clause defeats logic from all perspectives.
First, the work contemplated in the tender pertains
to nine offices of the West Bengal Pollution Control Board.
Out of the said offices, only two are situated in proper
Kolkata.
Although learned counsel for the respondent nos.2
to 4 is justified in submitting that some of the other
officers are also in the vicinity of Kolkata, even otherwise,
the offices at Barrackpore, Siliguri, Haldia, Hooghly,
Asansol and Durgapur cannot be said to be within or very
near the territory of Kolkata.
That apart, the said clause has no direct nexus
with the purpose of the contract, which is to provide
personnel for the purpose of house-keeping activities.
It may very well be that a particular prospective
bidder does not have any office in Kolkata but has
sufficient manpower to provide such personnel for the
purpose of deployment in all the nine offices as stipulated
in the Notice Inviting Tender (NIT). Such a person would
not even be eligible to participate in the tender and is
shut out at the initial stage.
Moreover, there is a wider perspective to be
considered. In the event the bidder is restricted to having
an office in Kolkata even for the purposes of eligibility
criteria, several people placed on an equal footing as
persons having office in Kolkata, spread over in the
Districts of West Bengal, shall be precluded at the outset
from participating in the contract, thereby depriving the
Tender Issuing Authorities, who are Government
functionaries and public authorities, from having a much
wider and varied participation in the tender.
As held by the learned Single Judge in M/s Rupa
Enterprises vs. State of West Bengal in WPA 11519 of
2023, the competition ought not to be narrowed down by
introducing an unreasonable clause in the participation
process itself.
The court further held that the restriction
introduced in a particular clause of the relevant tender
therein, restricting participation to bidders having
physical office in the vicinity of 10 kms, was
unreasonable and arbitrary.
The same logic applies to the present case as well.
The stress sought to be laid by learned counsel for the
Pollution Control Board on the number of kilometres
mentioned by the learned Single Judge does not hold any
relevance in the context of the ratio of the said judgment.
The principle laid down therein is in consonance with the
above observations of this Court as well.
Insofar as the judgment rendered by the Supreme
Court in Silppi Construction (supra), the Supreme Court
observed that the court can only interfere in cases of
arbitrariness, irrationality, mala fides and bias.
Although, in the present case, no specific mala
fides has been made out by the petitioners, at least prima
facie, there undoubtedly is arbitrariness and irrationality
in the clause-in-question, since the mandatory pre-
participation restriction of the bidders to have an office
within the territory of Kolkata frustrates the entire
purpose of seeking a wide participation from all corners of
the State for the purpose of manning housing keeping
jobs.
Merely having an office within the periphery of
Kolkata does not have any relevance or nexus with the
purpose of the tender, which is to supply manpower for
the purpose of manning nine offices of the pollution
control board, spread over different parts of West Bengal.
This unwarranted bias towards people having
offices in Kolkata, which is the main seat of
administration of the State, is unjust, irrational and has
no nexus with the purpose of the tender.
Insofar as the judgment of Michigan Rubber (supra)
is concerned, in the said case the Supreme Court laid
down certain principles which cannot be disputed.
The Supreme Court, inter alia, stressed on the
basic requirement of Article 14 and observed that 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 malicious and in misuse of the
statutory powers.
Certain preconditions or qualifications for tenders
were held mandatorily to be laid down to ensure that the
contractor has the requisite capacity and resources.
Applying the same test to the present case, the
resources and/or the competence of the contractors have
no connection whatsoever with the contractor having an
office within Kolkata.
Having an office in Kolkata is not such a haloed
proposition which will sanctify the incompetence,
otherwise, of certain bidders, in the event they failed on
the crucial score of supplying adequate personnel to man
the offices of the Pollution Control Board.
The Division Bench, in the judgment of Renesco
India Pvt. Ltd. (supra), also stipulated certain yardsticks
of interference by the court. It was held that the court
does not have the expertise to correct an administrative
decision. If review of an administrative decision is
permitted, it was observed that it will amount to
substituting the court's decision without the necessary
expertise.
However, in the present case, no particular
expertise is required to see through the patent violation of
Article 14 of the Constitution of India as well as Article 19
of the Constitution, inasmuch as people not having an
office in Kolkata and not centered in Kolkata, even if
otherwise competent and located or based in the other
parts of the State, would be deprived at the outset from
participating in the tender process.
Hence, there is a patent ingredient of violation of
the said Articles implicit in the impugned clause no.7.
Insofar as the judgment cited by the State is
concerned, this is not a case where the tenderer is
seeking to dictate terms.
The essentiality of a particular clause definitely has
to be decided by the employer.
However, serial no. 7, which pertains to the office
location, cannot, by any stretch of imagination, be an
essential clause from anybody's perception.
In fact, the said clause has no nexus with the
purpose of contract as reiterated above and, hence, does
not stand the scrutiny of a reasonable person or even the
Wednesbury principle harped on by the respondent nos. 2
to 4.
However, insofar as the serial no. 2 regarding
credentials complained of by the petitioner is concerned,
the same, in all fairness to the authorities, does not stand
the test of the Wednesbury principle.
The Tender Issuing Authority, in its wisdom,
required that the prospective bidders have the credentials
regarding contract for the last three years, which is a
reasonable period, for at least 1/3rd of the number of
personnel required, for three similar types of work,
totalling to 75 numbers of personnel.
Moreover, under the said clause, the employer
seeks that the previous experience must be confined to
three different types of work under the same organization.
The same yardsticks are applicable to the present
tender as well, since all the nine offices involved belong to
the West Bengal Pollution Control Board, that is, the
same employer, and the workers will be deployed to
different places at the same time.
A simultaneous co-ordination between the said
personnel by the same bidder is a necessary prerequisite
for the purpose of such deployment.
It may very well be that a particular contractor has
several personnel under his care but is unable to
coordinate and deploy such personnel in different places
in West Bengal simultaneously.
Hence, the authorities cannot be faulted on the
ground of the credentials sought at serial no.2 as an
eligibility criterion in the NIT.
However, on the score of introduction of an
irrational clause by way of the office location being
stipulated to be in Kolkata, the said clause has to be set
aside.
In such view of the matter, the petitioner has made
out a strong prima facie case for the writ petition to be
heard on merits.
Hence, the petitioner is entitled to the interim order
as prayed for in the writ petition.
However, applying judicial prudence, it is evident
that in the event the tender process is stayed outright
and/or set aside at this final stage, the same will involve
much further expenditure of public money.
That apart, in view of the nature of the urgency of
the job sought to be achieved by the tender, a blanket
setting aside and/or stay of the tender process would
enure to nobody's benefit.
Hence, since no specific prayer for filing affidavits
has been made by the respondents and in view of the
present adjudication being limited to the legality and
Constitutionality of the clause concerned, there is no
need to keep the matter pending further unnecessarily.
Accordingly, WPA No. 13404 of 2023 is disposed of
by restraining the respondent-authorities from proceeding
further with the impugned tender in its present form.
However, it will be open to the respondent-
authorities to issue a corrigendum deleting serial no. 7
and any other corresponding clause, if any, from the
eligibility criteria of the impugned NIT and thereafter, to
proceed with the tender with the rest of its clauses intact,
by extending the schedule of dates given in the tender in
appropriate manner.
It is made clear that in the event such corrigendum
is issued by the respondent-authorities, the respondent-
authorities can proceed on the basis of such
corrigendum, merely by extending the dates from the bid
submission closing dates onwards and the subsequent
calendar of dates appearing in the NIT accordingly.
There will be no order as to costs.
Urgent photostat copies of this order, if applied for,
be given to the parties upon compliance of all requisite
formalities.
(Sabyasachi Bhattacharyya, J.)
