Medico Remedies Limited vs State Of Chhattisgarh
2022 Latest Caselaw 3783 Chatt

                                       1
                                                                           AFR
             HIGH COURT OF CHHATTISGARH, BILASPUR

                         WPC No. 2294 of 2022

   1. Medico      Remedies Limited      (Through   Its Authorized   Signatory/
      Representative), 1105/1106, Hubtown Solaris, N.S. Phadke Marge, Opposite
      Teligali, Andheri East. Mumbai, Maharashtra.

                                                                  ---- Petitioner

                                    Versus

   1. State Of Chhattisgarh (Through Principal Secretary, Department Of Health
      And Family Welfare And Medical Education), Mahanadi Bhawan, Nava
      Raipur, District Raipur, Chhattisgarh.

   2. Chhattisgarh Medical Services Corporation Limited (Through Its Managing
      Director) 1st And 2nd Floor,commercial Complex, North West Corner, Sector
      27, Atal Nagar, Raipur, District Raipur, Chhattisgarh.

   3. Deputy Manager (Purchase And Operation), Chattisgarh Medical Services
      Corporatin Limited, 1st And 2nd Floor,commercial Complex, North West
      Corner, Sector 27, Atal Nagar, Raipur, District Raipur, Chhattisgarh.

                                                         ---- Respondents

For Petitioners : Mr. Kishore Bhaduri Sr. Adv along with Mr. Pankaj Singh, Advocate.

For State                       :     Ms. Akanksha Jain, Dy. G.A.
For Respondent nos. 2 & 3       :     Mr. Animesh Tiwari, Advocate.


                    Hon'ble Shri Justice P. Sam Koshy
                              Order On Board
15.06.2022

1. Aggrieved by the impugned order dated 12.04.2022 (Annexure P/1),

the instant writ petition has been filed by the petitioner. Vide the said

impugned order, the petitioner's firm has been blacklisted for a period

of three years.

2. The facts of the case in brief is that respondents no. 2 & 3 floated a

tender on 25.06.2020 calling upon the interested parties for the supply

of EDL/Non-EDL drugs and consumables /ayush /equipment /kit items.

The petitioner participated in the said tender for the supply of three

drugs, those are Amoxycillin Cap. IP 250mg, Amoxycillin Cap. IP

500mg and Ciproflaxacin Tab. IP 500 (D123).

3. In terms of the tender document itself, the validity of the Bid was for a

period of 120 days as would be evident from Clause-4.2. For ready

reference the contents of the validity of the bid from the terms of the

tender document are being reproduced here-in-under:-

"4.2 Validity of Bid The bid shall be valid for a period of 120 days from the date of opening of Cover-A (Technical Bid) and prior to the expiry of the bid validity, the Tender Inviting Authority may request the BIDDERs to extend the bid validity for further period as deemed fit. However, CGMSC Ltd., reserves the right to place purchase orders at the quoted rate till such period of validity of the tender and the BIDDER(s) are bound to accept the orders at the rates quoted / accepted and within the production capacity indicated in the tender, irrespsective of execution of agreement / finalization of price."

4. The tender was floated on 25.06.2020 and the period of the validity

would start from opening of Cover-A which was opened on

21.07.2020. Accordingly, 120 days comes to an end on 17.11.2020.

Though, the petitioner's firm had participated in the tender, they were

not offered any order till the validity of the bid i.e. uptill 17.11.2020. In-

terms of clause- 4.2 of the tender document, the validity period of the

bid was also not extended by the respondents 2 & 3, as such the

validity of the bid automatically got lapsed beyond 17.11.2020.

Subsequently, the respondents no. 2 & 3 made certain

correspondences with the petitioner for the supply of the

aforementioned three drugs. However, the petitioner-firm at that point

of time, though accepted the offer, but had quoted a different and

higher rate from that quoted in the bid that was submitted by the

petitioner. This was not acceptable to the respondents no. 2 & 3 and it

was on this context that the respondents no. 2 & 3 issued a show-

cause notice to the petitioner calling upon the petitioner to explain as

to why they should not be blacklisted. The petitioner thereafter

approached this Court by way of a writ petition i.e. WP(C) No. 5285 of

2021, this Court disposed of the said writ petition permitting the

petitioner to submit his explanation to the show-cause notice and the

respondents in-turn to consider the contents of the said reply that the

petitioner would be submitting and to pass a fresh order altogether. It

was further directed that the respondents while taking a decision on

the show-cause proceedings, would also bear-in-mind clause 4.2 of

the tender document dealing with the validity of the bid.

5. Pursuant to the disposal of the aforesaid writ petition by this Court on

03.01.2022, the impugned order now has been passed on 12.04.2022.

The respondents have now passed the order of blacklisting the

petitioner-establishment for a period of three years, which is under

challenge in the present writ petition.

6. Primary contention of the learned counsel for the petitioner is that

once when the validity of the bid got lapsed on culmination of 120

days' period and meanwhile since there was no offer made hence

there was no obligation as such upon the petitioner's firm whatsoever

towards the respondents no. 2 & 3. It was the further contention of the

petitioner that in-spite of the fact that clause 4.2 of the tender

document had a provision for extending the validity of the bid, the

respondents no. 2 & 3 chose not to extend the validity. Under the

given circumstance also, the petitioner cannot be held liable or find

fault with, if they do not honour any subsequent demand being raised

by the respondents no. 2 & 3 acting upon the original bid which the

petitioner had submitted as it had lost its validity on 17.11.2020 itself.

Though this Court while disposing of the writ petition on the earlier

occasion on 03.01.2022 in WP(C) No. 5285 of 2021 had in very

specific terms, directed the respondent-establishment to consider the

contents of the reply that the petitioner shall be furnishing to the show-

cause notice and also to take note of Clause- 4.2 and deal with it while

taking a final decision. In spite of that the respondents have only

referred to clause 4.2 and have given an interpretation to the said

clause holding that even beyond a period of 120 days, the

respondents no. 2 & 3 had the right to raise the demand at the price

submitted by the petitioner. For ready reference, the relevant portion of

the impugned order dealing with clause 4.2 is reproduced here-in-

under:-

"lkFk gh] fcM oS/krk ds dafMdk dzekad 4-2 dks lw{erk ls i<+k x;k ftlesa ;g ys[k gS fd The bid shall be valid for a period of 120 days from the date of opening of Cover-A (technical bid) and prior to the expiry of bid validity, the TIA may request the bidders to extend the bid validity for further period as deemed fit. However, CGMSC Ltd, reserve the right to place purchase orders at the quoted rate till such period of validity of the tender and the bidders are bound to accept the orders are the rate quoted/accepted and within the production capacity indicated in the tender, irrespective of execution of agreement/finalization of price." blds voyksdu ls ;g Li"V gksrk gS fd fcM oS/krk ds lkFk&lkFk blh dafMdk esa lhth,e,llh dks ;g gd iznRr fd;k x;k gS fd og dz;&vkns'k quoted nj ij fufonk oS/krk ds le; rd ns ldsxk vkSj fufonkdkj ck/; gS ,sls dz;&vkns'k dks QeZ ds }kjk fufonk esa n'kkZ;s x;s mRiknu {kerk ds Hkhrj vkiwfrZ djus okLrs] pkgs vuqca/[email protected] dk vfrdze.k gqvk gks vFkok ughaA blds ifjis{; esa] fufonkdkj } kjk bl fufonk dh performance ugha dh tk jgh gSA

7. It would be relevant at this juncture to take note of the judgment of the

High Court of Jharkhand in the case of Ramesh Kumar Agarwal Vs.

Food Corporation of India, reported in AIR 2019 Jhar 100 wherein

Paragraph 6.12, 6.13, 6.18, it was held as under:-

(xii) It ought to be kept in mind that whenever any offer is placed by the offeree for the construction etc, and the lowest amount is quoted for the construction, in such eventuality, the offer of the

offeree cannot be valid for infinite time, otherwise, as for example e.g., today the offer is made to construct a particular building in Rs. 5 lakhs and the actual construction is to be made after five years, the offer shall not be valid for five years because the cost of construction might have been enhanced. Here, the offer was made by this appellant for the construction of the godown etc., as district- Koderma, looking the condition no. 11 of the notice inviting tender, as stated hereinabove, the bid/offer of this appellant was never valid for infinite time. It was valid anyway for 90 days and thereafter for further period of 45 days, as stated hereinabove, the last date for validity of the period of bid was 10th April 2012. There is a clause for further extension of the validity of the bid also, as per condition no. 11 of the notice inviting tender, but it was by mutual consent of the parties. This consent was never given by this appellant. Thus, validity of the bid was never extended by mutual consent beyond the period of the 10 th April, 2012. Thus, the offer comes to an end automatically after the expiry of its validity period as stated in condition no. 11. There cannot be a validity period of offer for months together and years together, especially when the acceptor is a Government or Government institutions in which validity period slowness is inbuilt, Private parties has their own speed. Hence, this type of "validity period" of an offer is incorporated in the notice inviting tender.

(xiii) Once the validity period of the bid is over by the cessation of the time or because of efflux of time on 10th April, 2012 it cannot be accepted by respondent no. 1 unless, validity period of the bid is extended by mutual consent as per condition no. 11 of the notice inviting tender. There is no extension of the validity period of the bid by mutual consent. This aspect of the matter has not been properly appreciated by the learned Single Judge while dismissing the writ petition preferred by this appellant. Hence, the judgment and order passed by the learned Single Judge in W.P.(C) No. 2696 of 2012 dated 8th October, 2012 deserves to be quashed and set aside.

(xviii) Thus it appears from the facts of the case that once the validity period of the offer comes to an end, on 10th April, 2012 and the said validity has not been extended by mutual consent, it could not have been accepted by respondent no. 1 The offer is accepted on 12 April, 2012 and not on 10th April 2012. The date of acceptance is not to be looked into at all, but, the date on which the acceptance is put in transmission is to be looked into (As per Section 4 of the Indian Contract Act, 1872). In the facts of the present case, acceptance was put in transmission on 12th April, 2012 (page no. 112 of the memo of this Letters patent Appeal). Thus, there is no consensus ad-idem and hence, also such type of acceptance of the offer cannot be resulted into a valid contract because there was no valid acceptance of the offer at all on 12th April, 2012. The offer was over on 10th April, 2012.

8. The Hon'ble Supreme Court, in the case of Riya Travel & Tours

(India) Pvt. Ltd. Vs. C.U. Chengappa and Ors., (2001) 9 SCC 512,

in Paragraph-6, held as under:-

"6 From the facts enumerated hereinabove, it is clear that the offer of the appellant was a qualified one. The bid was not open for acceptance for an indefinite period. In the offer made by the appellant. It was clearly stated that the acceptance should be

conveyed within three months which was subsequently extended up to July 1999. When admittedly there was delay in the acceptance of the bid the appellant was at liberty to ask for the refund of money already paid to withdraw from the bid at least after 09.07.1999."

9. Though this aforesaid judgment in the case of Riya Travel (Supra)

deals with the claim of the petitioner therein for refund of money

already paid by them but the analogy applied by the Hon'ble Supreme

Court in the said judgment is that once when the validity period

including the extended period of validity was over and there was no

offer made till then, the bidder has the right to withdraw from the said

bid on account of the inaction or failure on the part of department in

making any offers to the bidder.

10. Learned counsel appearing for the department however tried to

justify the action on the part of the respondents drawing the attention

of the Court to the pandemic situation that was prevailing at that point

of time and the administrative inconvenience that the department was

facing on account of which they could not finalize the bid during the

validity period.

11. Even if we accept the contention of the learned counsel for the

department, what needs to be considered is that nothing prevented

the department from extending the validity period which was well

within their power as per clause 4.2 in the tender document and the

respondents could have thereafter proceeded further. If that would

have been the case, perhaps the respondent-department would have

had some arguable grounds. In the absence of which it is difficult to

accept the contention and the analogy either contended by the learned

counsel for the department or accepting the justification provided by

the department in the impugned order Annexure P/1.

12. The further contention of the respondents is that, the petitioner

had themselves accepted the demand of the department so far as

supply of the some other products on the same price quoted in their

earlier bid, cannot be accepted for the reason that it is the aspect of

feasibility which had to be seen and it was for the petitioner's firm to

take a decision and where they have found it feasible they had

supplied the products demanded at the price quoted earlier, where it

was not feasible they have withdrawn their bid. The petitioner cannot

be compelled nor did the department have any powers thereafter

beyond the validity period particularly when the validity was not

extended to have insisted upon making supply at the price quoted

earlier.

13. Under the given circumstance, the impugned order so far as

blacklisting of the petitioner vide Annexure P/1 dated 12.04.2022 is

concerned, this Court has no hesitation in holding that the same is

apparently bad-in-law, arbitrary and illegal and the same deserves to

be set aside/ quashed. No order as to cost.

14. Accordingly, the present writ petition stands allowed and

disposed of.

Sd/-

P. Sam Koshy Judge Jyoti