Unibros vs All India Radio And Anr.
1995 Latest Caselaw 133 Del

JUDGMENT

M.K. Sharma, J.

(1) By this judgment and order we propose to dispose of both the writ petitions, viz. Cwp No.3426/94 and Cwp No.4184/94 as the facts and issues involved in both the writ petitions are similar.

(2) The petitioners have preferred the aforesaid two writ petitions before this Court with the prayer for quashing/setting aside the impugned conditions in the press notice dated 27.6. 1994 with respect to works mentioned therein including the work of construction of Door Darshan Bhawan, Mandi House-11, New Delhi. According to the petitioner the three conditions laid down in the press tender notice and quoted hereunder are arbitrary, irrational and have no nexus with the object sought to be achieved. According to the petitioners the respondents have evolved the said three conditions with a view to oust the petitioners from the competition and deprive them of their rights to tender. The petitioners' further case is that said conditions are clearly contrary to the qualifications by which the petitioners have been listed as Class 1 contractors by the Central Public Works Department.

(3) This Court issued notice in Cwp No.3426/94 on 16.8.1994 and further directed that the petitioner should be issued tender documents subject to further orders from this Court. In Cwp No.4184/94 this Court issued notice on 21.10.1994. With reference to the notice issued by this Court the respondents have filed their counter affidavits and both the writ petitions were taken up for hearing together and on closure of the arguments on 19th January, 1995 this Court reserved the orders directing the respondents that the petitioner in Cwp No.4184/94 shall also be issued tender documents. It was further directed that the petitioners in both the petitions shall be at liberty to submit their offers which will also be considered by the respondents Along with other offers and that the award of the tender may not be finalised till further orders.

(4) Brief facts leading to filing of Cwp No.3426/94 are that the petitioner is a registered Class I contractor for the last more than 20 years in the trade eligible to submit tender for building without any limit in the whole of India. The respondents had earlier issued a press notice dated 22.9.88 in pursuance of which the petitioner was held eligible for tendering for whole work of Doordarshan Bhawan, Mandi House, New Delhi which included double basement and 12 storeyed super- structure thereon. However, on account of finance shortage with the respondents the tender for only double basement were ultimately invited and the work was awarded to the petitioner which the petitioner successfully and satisfactorily executed in token of which a certificate was issued by the Engineer-in charge on 2.6.1994. According to the petitioner the work of double basement has been completed in all respects as on date and to the satisfaction of all concerned. However, for the reasons best known to the respondents a fresh advertisement was issued on 27.6.1994 for three works including the construction of the balance work of Doordarshan Bhawan Mandi House at New Delhi which was the subject matter of advertisement of 22.9.1988. In the said advertisement dated 27.6.1994 apart from the aforesaid work some more construction works have been added, one being at New Delhi and the other at Bombay. In the said advertisement three conditions of the following nature have been imposed:-

"1.Executed satisfactorily atleast one building work of value not less than Rs.10 crores or three works of Rs.5 crores each of total value of work done not less than 15 crores in not more than three works in the last 5 years.

2.Annual turnover of not less than Rs.10 crores in the last 3 years as per income tax return.

3.Should have executed satisfactorily at least one multi storeyed building of not less than six storey,"

(5) The case of the petitioner is that though he is a person fully equipped to carry out works of any magnitude besides being resourceful and technically very sound with strict quality control, he is sought to be ousted from the competition of even submitting tender by the imposition of such irrational or arbitrary conditions, although he had executed the work of double basement satisfactorily. The petitioner further stated that insofar as first work namely the Ii storeyed building i.e. super structure at Mandi House, New Delhi is concerned he had already been held eligible for the same by letter dated 25.9.1989. However, the respondents by their letter dated 2.8.1994 through their Superintending Surveyor of Works informed the petitioner that pre-qualification of tender dated 4.7.1989 stood cancelled.

(6) On the other hand the brief facts leading to the filing of the Cwp No.4184/94 are that the petitioners were pre qualified and short listed in the panel of contractors in respect of the All India Radio 12 storeyed D.D. Bhawan construction at Mandi House, New Delhi in pursuance of the advertisement issued on 22.9.1988. It is stated that the short listing of the petitioner as contractor in the aforesaid work has not yet been cancelled. It is further stated that the petitioners are included in the category of Class-1A Contractor and they are entitled and are eligible for tendering for works without limit in the whole of India. According to the petitioner there are only eight contractors in this category in the whole of India and they form a special class and cannot be excluded from any contract as far as pre qualification is concerned. However, the respondents for the reasons best known to them issued a fresh advertisement on 27.6.1994 including the construction of the building which was the subject matter of the advertisement on 22.9.988 in which two more construction works had been added besides the construction work of the Door Darshan Bhawan construction at Mandi House. In response to the aforesaid notice the petitioner by letter dated 27.11.1994 informed that they already stood short listed and have successfully paused the test of pre qualification and that they fulfilll all the conditions. However, on 9.8.1994 the respondents issued a letter refusing to short list the petitioners on the ground of turn over condition imposed in the aforesaid press notice issued on 27.6.1994. The petitioner by their letter dated 20.8.1994 informed that if the turnover of the petitioner for the years 1992, 1993 and 1994 are taken together, it will exceed Rs.30 crores. It was also brought to the notice of the respondents that the petitioners are approved Class 1-A contractor of the C.P.W.D. and are also entitled to execute work of unlimited amounts. However, on the ground of annual turnover condition as stated hereinabove the petitioner was disqualified and accordingly the petitioner filed this petition challenging the impugned press notice dated 27.6.1994 particularly the specific conditions imposed thereunder on the ground that they are arbitrary, irrational and have no nexus with the object sought to be achieved.

(7) During the course of hearing the respondents produced before us the relevant file relating to award of contract. A perusal of the contents of the said file shows that on 18.4.1994 a' report was made by Asw for formation of a committee for short listing the contractors. The said nothings were submitted to the Chief Engineer (Construction) on 4.5.1994. There is a further note by the Chief Engineer on 23.5.1994 that as per the decision of that day a meeting was held. It further appears to us there from that on 27.5.1994 a note of the meeting held on 23.5.1994 was made. The said noting mentions about the attendance of various persons and further stated that conditions for press tender were discussed and decided. The aforesaid noting dated 27.5.1994 is extracted below :-

"SW(1) A meeting was called by CE(1) in his chamber on 23.5.94 (Ref. Ce (C) remarks on NP-2). The meeting was attended by the following officers: SSW(1),SSW (II), Ssw (III), Se (Trg.),SE (Cl) New Delhi,SE (CII), New Delhi, SE(E4) New Delhi, Sr. F.O. Ee (E) Sw (P & M). It has been decided by Ce (C) that pre qualifications of Agencies/contractors is required to be done for all the 3 projects i.e. Mandi House Ph.II, ESD/NSD, Fd Bombay. Since'the project are of time bound and special nature, the terms and conditions for press tender notice for PQ' has also been discussed and decided in the meeting. Accordingly brief press notice for Pq is put up for kind perusal and Appl. Swi RMGarg 27.5.94"

(8) Mr. Rajesh Lakhanpal, learned counsel for the petitioner in CWP. No-4184/94 submitted that the petitioner being registered Class I contractor was eligible to submit tender for building without any limit and accordingly the petitioner has a legitimate expectation and interest to tender for the works in question. However, learned counsel submitted that in view of the irrational and malafide criteria and conditions adopted by the respondents the petitioner is being deprived of his right to tender. He further submitted that depriving the petitioner of his right to tender for the work in question on account of certain arbitrary and irrational conditions having no nexus with the object sought to be achieved smacks of biasness on the part of the respondents. While elaborating his arguments, learned counsel for the petitioner submitted that the respondents have chosen to put in condition I to the effect that the intending contractor that the agency should have executed atleast one building work of value not less than Rs. 10 crores or three works of Rs.5 crores each is contrary and unten able, in view of the fact that the petitioner who has otherwise proven ability, capability and finance and has capacity of executing the work can take up any work of any amount and therefore, the petitioner could not have been made ineligible by imposing a condition. In support of his aforesaid submissions, learned counsel for the petitioner relied upon a decision of this Court in Cwp No.4528 of 1993 and Cwp 4498/93 Paragon Construction (I) Pvt. Ltd. v.Union of India decided on October 8, 1993 wherein a similar condition in the notice inviting tender had held to be untenable and arbitrary by this Court. Learned counsel further submitted that the condition of annual turnover of not less than Rs. 10 crores in the last 3 years as per Income-tax return does not have any nexus to the object sought to be achieved. The learned counsel submitted that the condition I as put in in the press tender notice dated 27.6.1994 is redundant in view of condition 2 put in the press notice tender inasmuch as if the annual turn over of Rs.10 crores is warranted for 3 years then the condition of having exececuted the works of not less than Rs.l5 crores for the last 5 years, three works of Rs.5 crores in the last 5 years are without any merits and without any sanctity. Learned counsel for the petitioner further submitted that the condition imposed by the respondents in' the press tender notice dated 27.6.1994 are prima fade arbitrary and capricious as is borne from the file which was produced before us. According to him no committee for short listing was formed and it is not apparent as to what was discussed in the meeting for evolving the criteria. The said note, according to him, further makes it clear that nothing was put on the record either by way of notes or by way of any minutes recorded as to how and on what basis the criteria/ conditions as mentioned in the press tender notice dated 27.6.1994 were evolved.

(9) Mr. Arvind Kumar learned counsel appearing for the petitioner in Cwp No.4184/94 adopted all the submissions made by the learned counsel for the petitioner in Cwp No.3426/94 and further submitted that the conditions imposed are arbitrary as because for one work or for all the three works together .conditions imposed by the impugned press note are the same. According to him, prequalification for each work ought to have been separate and the same having not been done the said action is in violation of Article 14 of the Constitution of India.

(10) Mr. Madan Lokur, learned counsel appearing for the respondents on the other hand, submitted that all the three works as per advertisement in the impugned press notice are to go on simultaneously and consequently the respondents have to be alive to the possibility that one contractor might be the lowest bidder for atleast two projects and if the respondents would have ignored the said possibility then they would have been ignoring the relevant material which would have vitiated the decision of the respondents. Accordingly, he submitted that taking the aforesaid facts into consideration the conditions have been so imposed in the impugned press notice. According to him, considering all the permutations and combinations of time factor, financial aspects and also the sites of the projects there is nothing irrational in the respondents prescribing pre- qualification or eligibility criteria requiring a turnover of Rs.10 crores per year for three years which would ensure that only those who are capable both financially and logistically, participate in the tender. Learned coucoun sel further submitted that there is no legal requirement for keeping minutes of every meeting that is held by (Government officials and "absence of the same could at best be a procedural omission having no substance. He further submitted that it is not permissible for a litigant or even for this Court to delve into official files to find out points in favor of or against a litigant and nothings are not being made in the official file so as to subject them to public scrutiny. Learned counsel for the respondents further submitted that there is a limit to the judicial review of an administrative action and this Court cannot substitute its decision without the necessary expertise to find out as to whether a particular condition put in by. the respondents is arbitrary or tional.

WE fjursdiction have given our anxious consideration to the facts of the case as borne out by the pleadings of the parties and also to the submissions made by the learned counsel for the parties. It is true that in respect of judicial review of an administrative decision the juridiction of the Court is circumscribed. However, even though the rights of the citizen are in the nature of contractual right the manner, the method and the mode of a decision of entering or not entering into the contract are subject to review on the doctrine of relevance and reasonableness as has been held by the Apex Court in the case of Mahabir Auto Stores and Others vs. Indian Oil Corporation and Others reported as .

(11) Being alive to the aforesaid legal position, we would like to proceed to examine the rival contentions of the parties with regard to the merits of the case. On perusal of the records we find that the petitioners of both the writ applications are registered Class I and Class-I-A contractors respectively carrying on building activities. The petitioners in CWP. No.3426/94 have also annexed with the petition a certificate issued by the Executive Engineer, Civil Wing of the office of the Executive Engineer, All India Radio to the effect that the petitioners are fully equipped to carry on work of any magnitude and it is resourceful and technically very sound and have strict quality control. The petitioner in CWP. N0.4184/94 has also annexed document which shows that they are entitled and eligible for tendering works without limit in the whole of India. The petitioner in Cwp No.33426/94 have also successfully completed the double basement of same very Doordarshan Bhawan Mandi House, New Delhi in all respects as on date and to the satisfaction of all concerned.

(12) We have perused the contents of the records in the file produced before us. We find there from that a report was made by Asw for formation of a committee for short listing the constractors. On the other hand the noting of 27.5.1994 shows that a meeting was held on 23.5.1994. The said noting, however, except for showing the names of the persons who attended the meeting and only stating that conditions for press tender notice were discussed and decided does not say any thing beyond. From the aforesaid nothings it thus appears that no committee was formed for short listing the contractors. Even the conditions for finalisation of which the meeting was called have also not been recorded. It'appears to us that the note of the meeting dated 27.5.1994 had been written by a person who did not participate in the meeting. Nothing is put on the record either by way of note or by way of minutes of the meeting recorded as to how and on what basis the criteria/conditions as mentioned in the press tender notice dated 27.6.1994 was evolved.

(13) This fact is more relevant in view of the ambiguous stand taken by the respondents in the counter affidavit with regard to condition No.2 of the impugned press notice. It has been stated by the respondents in their counter affidavit that the turnover has also been limited to Rs.lO crores as against earlier as Rs.9 crores, whereas the condition No.2 incorporated in the impugned press tender notice is " annual turnover of not less than Rs.lO crores in the last three years as per income tax return as against the condition of the earlier press tender notice dated 22.9.88 turnover of not less than Rs.9 crores in the last three years as per income tax return."

(14) The first condition in the impugned press tender notice is with regard to the execution of one building work of value of not less than Rs.lO crores or three works of Rs.5 crores each. A similar condition in a notice inviting tender has been held to be arbitrary and untenable in a decision of this Court in Cwp No.4528/93 and CWPNo.4498/93 (supra).

(15) It further appears that the conditions imposed in the impugned press notice which a contractor is obliged to meet either for one work or for all the three works together are the same, which appears to us to be too stringent for a person intending to bid only for one work.

(16) Mr. Lokur submitted that an action for blacklisting the petitioner in Cwp No.3426/94 by the respondents is pending. We have been informed that the same matter is now subjudice before this Court in the form of another writ application. At present, however, the petitioner is not blacklisted and, accordingly, we feel that the said fact has no relevance to the facts and circumstances of the case and the petitioner cannot be deprived the right to participate in the tender proceeding.

(17) In view of the aforesaid facts and circumstances of these cases we do not see any reason why the petitioners should not be allowed to exercise their rights to tender in respect of the works as mentioned in the impugned press tender notice on the ground that they do not fulfill the criteria or the conditions mentioned in the impugned press tender notice, which in our opinion, appear to be arbitrary and untenable in view of the factual and legal position enfabsenc umerated above and particularly in view of absence of any intelligible or reasonable basis or reasons disclosed from the official files of the respondents for laying down such conditions/ criteria.

(18) In our order dated 19th January, 1995 we directed that the petitioners of the present writ petitions would be at liberty to submit their offers which would also be considered by the respondents Along with other offers. We, accordingly, issue a writ of mandamus directing the respondents to consider the petitioners' tenders on merits, which were submitted as per our order Along with other tenderers who have submitted their tenders in respect of the works mentioned in the impugned press tender notice.

(19) The writ petitions are accordingly allowed. In the peculiar facts and circumstances of the case the parties are left to bear their own costs.