Polo Amusement Park & Anr. vs India Trade Promotion ...
2000 Latest Caselaw 462 Del

ORDER

Manmohan Sarin, J.

1. The petitioner company, which runs an amusement park by the name and caption of Fun 'N' Food Village, Kapeshera, has filed this writ petition, aggrieved by the tender conditions framed by respondents 1 and 2 in respect of development and setting up of the amusement park at the Pragati Maidan, New Delhi. At present, an amusement park by the name of "Appu Ghar" is being run at Pragati Maidan.

2. Petitioner's case in brief is that it is a company, which has been successfully running the amusement park under the name of "Fun `N' Food" at village Kapeshera. It has the expertise and the resources for successfully, setting up and running the proposed amusement Park at Pragati Maidan. However, the respondents have devised and designed the terms and condition of the tender, so as to exclude fair competition. The terms and conditions of the tender enquiry are such so as to render ineligible a company like the petitioner, who are otherwise fully capable of developing and running the amusement park of high standards.

3. Learned counsel for the petitioner submits that in fact the terms and conditions especially, the eligibility criteria given at Clause 2.51, appearing at page 145 of the paper book is so designed, so as to exclude and scuttle competition. In fact the petitioner goes to the extent of urging that this has been made to accommodate a promoter of amusement park by the name of "Black Thunder", who alone would remain eligible for the present tender. It is alleged that the terms are tailor made for the said party. This, it is claimed, has been done mala fide, with a view to favour the promoters of Black Thunder.

4. The second limb of the petitioner's submission is that the eligibility criteria as set out, which for the sake of convenience is reproduced below, has no direct nexus with the object sought to be achieved:

Clause 2.5.1 The applicant must fulfill all the following eligibility criteria for shortlisting:

     -    Constitution  of the project executing vehicle: The  project executing  vehicle should be incorporated as a company under  the Indian Companies Act, 1956. 
 

     -    Relevant  experience  of managing  and  operating  amusement park/theme  parks/water parks/multiplexes/leisure  complexes  and other related facilities: The promoter (s) must have managed  and operated  one  or more than one similar facility in  the  last  3 years. 
 

     -    Relevant experience of developing and implementing amusement park/theme  parks/water parks/multiplexes/leisure  complexes  and other related facilities: The promoter(s) must have developed and implemented  one or more than one similar project in the last  10 years. 
 

     -    Investments  made in similar projects in the past: The  promoter(s)  must  have made minimum capital investments in  one  or more similar project of Rs.100 million in the past 10 years. 
 

     -    Networth of the promoter company: The promoter(s) must  have a  minimum consolidated net worth of Rs.100 million in  the  last financial year. 
 

     -    Net  cash accruals of the promoter(s): The promoter(s)  must have  average  net cash accruals of Rs.150 million  in  the  last three years. 
 

     -    Liquid  assets,  as defined as cash  and  other  investments readily  convertible  into cash in a period of 6 months,  of  the promoter(s) should be at least Rs.125 million or the  promoter(s) should be able to display documented ability to mobilize Rs.  125 million in a period of 6 months. 
 

     -    The  promoter(s) should have filed Income Tax &  Wealth  Tax returns in the last assessment year. 

 

The submission is that the experience requirement was of a promoter having developed and set up one similar project in the last 10 years. Yet the financial limits prescribed are made stringent so as to exclude other experienced and qualified persons, who have been running amusement parks. The stringent financial conditions are unnecessary and not required for setting up and and operating amusement parks. Learned counsel submits that even the promoter of Appu Ghar would not be eligible by the said criteria. Learned counsel criticised the requirement of Rs.10 crores of capital investment on similar project in the last 10 years. The requirement of having minimum consolidated networth of Rs.10 crores, as also cash accruals of Rs.15 crores in the last 3 years are not necessary for the purposes of successfully developing and operating the amusement park. Learned counsel also placed reliance on M/s. Dhar Cement Ltd. and others Vs. State of Madhya Pradesh through Secretary, Ministry of Irrigation Government, Madhya Pradesh, Bhopal and others , wherein the court had struck down a tender condition prescribing an exceedingly high production capacity of cement plant, which was not required for the meagre quantities to be supplied as per tender. This authority shall be adverted to later.

5. Show cause notice was issued and a short counter affidavit has also been filed on behalf of respondent No.1. I have heard the learned Additional Solicitor General Mr. Mukul Rohtagi and Mr. Ravinder Sethi, senior advocate, on behalf of respondents. The respondents have in the counter affidavit averred that keeping in mind the past experience of the amusement park being run by the name of Appu Ghar, the respondents were desirous of setting up an amusement park, which would meet international standards. Towards this end, a Committee has been constituted under the Chairmanship of Additional Secretary and other senior officers, financial advisors. The Committee the deliberations, decided that terms and conditions for the global tender be devised by professional consultants. M/s. FCI Financial services were appointed the consultants for the project, who have after deliberations devised detailed terms and conditions.

6. The question to be considered is whether the terms and conditions of a tender enquiry devised by expert consultants and approved Committee of senior officers and experts should be subjected to judicial scrutiny. The answer to this is not far to seek. The Supreme Court in the case of TATA Cellular Vs. Union of India - AIR 1996 S.C. 32 observed:

"The terms of the invitation to tender cannot be opened to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often then not such a decisions are made qualitatively by experts."

7. The Court is neither aware of nor it needs to delve into what the projected investment, gross returns, revenue and expenditure for the proposed amusement park should be. It is not for this court to assess whether the sum of Rs.10 crores projected as investment is sufficient or whether the prescribed cash accruals would be necessary. There are matters strictly for the experts and within the administrative domain. In any case it is not open for the court to substitute its own opinion even if it is different with regard to sufficiency or adequacy of the specified eligibility terms. Learned counsel at this stage submitted that the terms are irrational and arbitrary so, therefore, deserve to be struck down. In these facts, it cannot be said that the prescribed eligibility criteria is so arbitrary or irrational that no reasonable person could have taken such a decision.

8. The petitioner has also not been able to make a case of mala fides. There is nothing on record to support the petitioners' plea that the eligibility criteria was prescribed so as to exclude all others except the promoters of the park "Black Thunder." Respondents in the affidavit have stated that ten parties have submitted their bids.

9. The reliance by the petitioner on Dhar Cement Ltd. Ors Vs. State of M.P. (Supra) would also not advance its case. The cited case was one where the petitioner therein had manufacturing capacity of 1 lac tonnes but was excluded by the tender term for supplying even a meagre quantity of 4000 tonnes by prescribing a capacity of 40 lac tonnes. The Court came to the conclusion that a term requiring the tenderer to have the capacity of 40 lacs of tonnes to supply only meagre quantity of 4000 tonnes was arbitrary and irrational. There is no such material on record to hold that the present case is vitiated by any such arbitrariness or irrationality.

In view of the foregoing discussion, the petitioner has failed to make out a case for interference in exercise of jurisdiction under Article 226 of the Constitution of India.

10. The writ petition has no merit and is dismissed.