Sudesh And Ors. And S. Kumar ... vs Mtnl
2003 Latest Caselaw 451 Del

JUDGMENT

Badar Durrez Ahmed, J.

1. These two writ petitions relate to the same tender invited by the common respondent i.e. Mahanagar Telephone Nigam Limited (hereinafter referred to as MTNL). As such, both the petitions were taken up and heard together and are being disposed of by this common judgment.

2. The facts giving rise to the said petitions are as under:-

2.1: By advertisements appearing in the Sunday Hindustan Times, New Delhi Edition of 24.11.2002, the MTNL issued Notice Inviting Tenders, inter alia, in respect of "Tender No. AGM (MM-II)/MM-15/No-dig/2002-03/10 To fix R/C for laying of telephone cable (optical fiber cable and PIJF cable) by trenchless technology in Delhi".

2.2: The said advertisements carried a foot note which read as under:-

"For detailed information, please log on to any of our following websites:

 http://www.nividasewa.com      http://www.tender-mart.com."
 

 2.3: The aforesaid web sites carried information posted by the MTNL in respect of, inter alia, the: 
   "Tender Subject: Laying of Telephone Cables (Transmission and Cable Construction Unit) of various sizes by "No-Dig" method using Trenchless Technology." 
 

 The information posted at the web sites1  reveals  that the tender related to Package "A" (construction unit) and Package "B" (transmission unit) as per details given therein.  It was clearly mentioned therein that:- 
  "Intending bidders may obtained a copy of the NIT and tender document which contains full terms conditions, details description, specifications, particulars and all other related formalities to be fulfillled by the bidders from the office of AGM (MM-II) by submitting Demand Draft of Rs.8000/- in favor of Accounts Officer (MM), MTNL, New Delhi between 1500 Hrs. to 1700 Hrs on all working days till the penultimate date of opening of tender after producing valid ITCC/Renewable receipt WCT registration certificate of Delhi, EPF registration and original document related to ownership of HDD machine of min 7 Ton Capacity i.e. 1. Commercial Invoice, 2. Bills of Lading, 3. Custom Bills of Entry, 4.  Custom Clearance Receipt etc, at least three days prior to last date of issue of tender document.  This is mandatory to purchase the tender document.    In case of PSU lease agreement of HDD machine only is desirable. Lease Agreement by PSU should be considered valid only if it is not with other participant bidders." 
 

2.4: Intending bidders who purchased the tender documents received the set of documents as set out in Annexure-I (Pages 20 to 66) in CWP 1001/2003 (hereinafter referred to as "the Bid Documents"). The documents reveal that the Notice Inviting Tender bearing T.E. No. AGM (MM-II)/MM-15/NO-DIG/2002-2003/10 (hereinafter referred to as "the said NIT") was issued on 13.11.2002 whereby sealed tender bids in two parts (Technical and Financial) were invited for fixed rate contract for laying of telephone cables (Transmission and Cable Construction Unit) of various sizes by "No-dig" method using Trenchless Technology in the jurisdiction of MTNL, Delhi Unit. The bids were invited from bidders having:

"i) A. Turnover of Rs.3 crores during last three financial years and more than one crore during last financial year, ownership of at least 7 Ton HDD machine (in case of PSU lease agreement of HDD Machine only is desirable. Lease Agreement with other participant bidders shall not be considered.),

B. Experience of cable laying by using Trenchless Technology for at least 2 kms. in MTNL/BSNL/DOT/Govt. PSU OR 5 km. in case of Basic Service Operators to quote for Transmission work.

C. Experience of Cable laying by using Trenchless technology for at least 5 Kms. in MTNL/BSNL/DOT/Govt. PSU OR 10 Km in case of Basic Service operators to quote for both Construction and Transmission.

ii) Solvency Certificate of not less than One Crore from Scheduled Bank,

iii) Not have been blacklisted or debarred in MTNL/BSNL or DOT/Govt. PSU."

These were the minimum eligibility criteria. If a bidder did not possess any of these criteria his bid need not be considered.

2.5: From the said NIT it is clear that the description of work entailed in the tender comprised two packages: Package A with regard to the Construction Unit and Package B with regard to Transmission Unit. The time schedule of the initial tender process specified in the said NIT was:

    
1 Date of receipt of request with documents & DD 27.11.2002 to 24.12.2002
2 Last Date of issue of documents   27.12.2002
3 Due date and time of receipt of bids  30.12.2002 up to 1100 hrs
4 Opening date & time    30.12.2002 at 1130 hrs
 

 The other important conditions mentioned in the said NIT were as under: 
 

 "8. Any clarification can be sought within 15 days from date of publication of tender. 
 

 9. Any bidder is allowed to quote for one of the two or both the packages depending upon eligibility condition. 
 

 10. The bids without purchase of tender documents shall not be entertained and will be rejected summarily.  The bids must be accompanied with bid guarantee. 
 

11. The techno-commercial bids shall be opened on the stipulated date and in case of the date failing on any holidays or in case of unforeseen contingencies, the bids shall be opened on the next working day at the same time without any further notice. The financial bids of only those bidders will be opened at a later date whose bids are declared responsive."

2.6: Section-I of the Bid Documents relates to the "Specifications for telephone Cable laying by "No-Dig" method using Trenchless Technology". Paragraph 1 thereof reads as under:

"1. Approximate Work of cable laying by Trenchless:

S.No. ITEM Diameter of Bore Size Approx. work (Kms)

1. Cable Construction Unit.(PIJF cable) Up to 145 mm >200 to 300mm 760 Km 65 Km

2. Transmission Unit(OF cable) Up to 145 mm >200 to 300mm 375 Km 3 Km

The length consists of road/ rail/ canal crossing with or without HDPE pipe and also laying along road with or without HDPE pipe. Total length may vary depending on progress of work."

From the above it is clear that the cable laying work that was contemplated under the said Bid Documents included laying of cables both with or without HDPE pipe.

2.7: Section-II of the said Bid Documents prescribes the "General Terms and Conditions of Cable Laying by Trenchless Technology Tender." Paragraph 1 thereof relates to eligibility conditions and is as under:-

"1. Eligibility Conditions

The intending bidders will have to comply under mentioned conditions in order to establish its eligibility for participation in the tender otherwise the bid will not be considered eligible and evaluated further:-

a) The intending bidder(s) must own a HDD Machine/Guided boring machine either in his/her name or in the name of the firm. Documentary evidence i.e. 1 Commercial invoice. 2. Bills of Lading. 3. Custom Bills of Entry. 4. Custom Clearance Receipt etc is required to be enclosed along with bid. These documents will be seen in original before issue of tender.

In case of PSU lease agreement of HDD machine only is desirable. Lease agreement by PSU should be considered valid only if it is not with other participant bidders.

b) This machine shall have pull back capacity of more than seven tons and shall be able to pull cable of 200 meters length in one stretch. This may be certified by manufacturer of the machine.

c) This GPRS machine with a capacity to detect underground utilities up to three meter or more shall be available either on owned or leased basis. A documentary evidence shall be enclosed lease agreement with the bid to testify this fact. In case the participating bidder has GPRS machine on lease basis then it will have to furnish legally vetted document.

d) The prospective bidder shall have turnover of Rs.3 Crores during last three financial years (put together) and more than Rs. One crore during last financial year. This shall be supported by current and valid ITCC or certified/audited copy of balance sheet.

e) The participating bidder will have to furnish solvency certificate in the format enclosed as Annexure-2 for an amount not less than Rs. One Crore from any scheduled bank. This shall be of current date and originally ink signed.

f) The intending bidder must have experience of Cable Laying by Trenchless Technology using Trenchless technology machine for at least of 2 kms of work from MTNL/DOT/BSNL/Govt. PSU or 5 km in case of Basic Service operator to quote for Transmission work and bidder must have experience off Cable Laying by Trenchless Technology using Trenchless technology machine of at least 5 kms of work from MTNL/DOT/BSNL/Govt. PSU or 10 Km in case of Basic Service operators to quote for Transmission and construction Unit both.

g) A certificate of satisfactory completion of these Works from MTNL/DOT/BSNL/ Govt. PSU Basic Service operators shall be enclosed with the bid. The certificate must be issued by an officer not less than the rank of Divisional Engineer in case of MTNL/DOT/BSNL and by Manager in case of PSU & Basic Service operators.

g)2 The prospective bidders will have to furnish documentary evidence that they are registered with EPF/RPF Commissioner. They will also furnish an undertaking that within seven days of the close of every month they will submit to MTNL a statement showing the recoveries of contributions in respect of employees with certificate that the same have been deposited with RFP Commissioner.

The bidders who do not meet above indicated eligibility conditions will not be considered as compliant and responsive ones and such offer will be rejected."

Paragraph 2 prescribes the documents that must be attached with the tender/offer which inter alia include (so much as is relevant):-

"i) ownership of HDD machine/Guided boring machine with more than seven tons pull back capacity and it shall be able to pull 200 meter length of cable at one stretch. The certificate from the manufacturer to this effect. PSU's may submit Lease Agreement of HDD machine.

ii) xxx

iii) Duly attested current & valid ITCC.

iv) Turnover of Rs. 3 crores during last three financial year (put together) and more than Rs. One crore during last financial year through ITCC or certified/audited copy of balance sheet.

v. Current dated Solvency certificate of Rs. One Crore in the format enclosed as Annexure-2.

vi. xxx

vii xxx

viii xxx

ix xxx

x. xxx

xi xxx

xii xxx

xiii xxx

xiv. xxx"

The documents sought vide sub-paras (i) to (x) were required to be furnished in order to show compliance with the eligibility conditions and non-compliance thereof was to result in rejection of the bid.

2.8: Paragraph 5 of the said Section-II provided for earnest money deposit and paragraph 5.2 contained the prohibition that "any tender not accompanied with the above prescribed Earnest Money Deposit shall be rejected forthwith." Paragraph 8 dealt with "Quantum of Work & Distribution, Evaluation and Award Criteria". It provided that "MTNL has the exclusive right to distribute the work between contractors in any manner that MTNL may decide and no claim shall lie against the MTNL by reason of such distribution of work". The quantum of the work was as specified in paragrapgh 2.6 above. The likely distribution was indicated to be as follows:

In respect of Package A (Construction Unit):

"L-1 20% and balance among 9 bidders lower in ranking in inverse ratio of their quote."

In respect of Package B (Transmission Unit):

"L-1 20% and balance among 5 bidders lower in ranking in inverse ratio of their quote."

Sub-para (j) of Paragraph 8 stipulated that:

"Both package A & B will be evaluated separately and relative ranking will be arrived at. The techno-commercial bids will be evaluated first and bids, which are found techno-commercially compliant, and responsive, these will be short-listed. The financial bids of only these short listed bidders will be opened at a later date with due intimation to them."

In the "Instruction to Bidder" after Paragraph 17.20 it is clearly pointed out that:

"Financial bid contain only Section-III. Techno-commercial bid to contain all other documents."

In N.B.4 following Paragraph 17.20, it is further made clear that:

"The Contractor will submit:- (i) Techno-Commercial bid along with the EMD as per Paragraph 5.1 of Section II and (ii) Financial Bids separately."

N.B.5 expressly provides that:

"Tender document contain proforma for financial bid (Section-III). Rate shall not be quoted or disclosed in any other document except in Section-III which shall be submitted separately in financial bid."

Sub-para (a) of the said N.B.5 is also relevant:

"a) Each quotation must be complete in all respects and rates must be quoted for ALL THE ITEMS in the3 given in Section-III."

2.9: Section-III of the Bid Documents contains the prescribed "Form for Quoting Schedule of Rates for Cable Laying by "No Dig" Method using Trenchless Technology" for both Packages A and B. The forms are different for Packages A and B4. However, both forms contain a listing of 15 items. Items at Serial Nos. 1,2 and 9 are of particular relevance for the purpose of these writ petitions. Serial No. 1 relates to "Horizontal Boring after GPR5 for along across the road at the minimum depth of 1.65 meters in respect of two different Bore sizes: (1) up to 145 mm, and (2) >200 mm to 300 mm. Serial No. 2 pertains to the work of "laying of HDPE pipe after Horizontal boring". Item at Serial No. 9 in the form in respect of Package A pertains to the "drawing of Copper Cable through HDPE Pipe" and in respect of package B pertains to the "drawing of OFC6 through HDPE pipe".

2.10: The items in these forms have been set out in tabular format and "Quantity", "Unit", "Work Unit" and "Total Working Quantity Unit" in respect of each item is prescribed. "Quantity" as the name suggests refers to the quantum of work and "Unit" means the unit of measure for the quantity such as metre, cubic metre, etc.,. "Work unit" is essentially the base price per unit of the item as prescribed by the MTNL. The "Total Working Quantity Unit" in respect of each item is arrived at by multiplying the "quantity" with the "work unit". It is, therefore, clear that the "total working quantity unit" refers to a rupee value or amount of a particular quantity of an item based on the "work unit" or base price set by MTNL. Thus, in the case of item 1a of Package B the "quantity" and the "work unit" prescribed are 3,75,000 (Mtrs) and (Rs.) 5.000 (respectively) and as such the "total working quantity unit" for the said item 1a would be (Rs.) 18,75,000.00. The "total working quantity units" in respect of each of the fifteen (15) items in the package is summed up (added together) to arrive at the grand total which has been shown at the bottom right hand corner of the table.

2.11: The tenderer is required to quote only a single rate for the entire work and the rate quoted must be the rate per work unit. The rates for both the packages A & B are to be quoted in the prescribed Form of Schedule of Rates given in Section-III of the Bid Documents. The manner of quoting and the methodology behind it is also explained with an example. The example being that if a tenderer quotes Rs.80/- per unit then, the total cost (value) of the bid would be 80 multiplied by the grand total of the "total working quantity units" in respect of the package. In the case of Package B the grand total was 22,63,877.00. Hence, if the tenderer quoted the single rate of Rs.80/- per unit then the total cost of the bid would be Rs.1,81,11,016.00. The same methodology is applied in respect of both packages A and B and has been devised so as to make it convenient for evaluation purposes as MTNL would have to deal with only a single quote in respect of each tenderer in respect of the packages A and B (respectively).

All this can be better explained mathematically:

Let i = ith item and n = total number of items in the Package (A or B).

S = Single rate quoted by a bidder (in Rs.).

Total cost (or amount) of bid =

It is clear that, S = f (q(1,..n), p(1,..n),P(1,..n))

In other words, the financial bid or the Single Rate quoted by the tenderer is a function of (a) the quantities prescribed for each item, (b) the "work units" or base prices fixed by MTNL for each item and (c) the estimated price for each item as estimated by the tenderer. If there is a change in any of these there will be a resultant change in the single rate (S) quoted by the tenderer. This is a very important relationship amongst these variables and is very crucial for the decision in this case as will be seen below.

2.12: The Petitioners in CWP 1001/2003 purchased the tender documents and submitted their bids, which included the Techno-commercial bids and financial bids, in accordance with the original schedule as prescribed in the said NIT. The Petitioner in CW 1225/2003 did not purchase the tender documents and accordingly, did not submit any bid pursuant to the said NIT.

2.13: On 17.12.2002 MTNL issued a clarification regarding validity of EMD7 submitted as BG8. It was clarified that the Bank Guarantee submitted as EMD shall be valid for 210 days from the date of opening of the tender.

2.14: On 26.12.2002 MTNL issued another clarification in respect of the said tender to the effect that Solvency Certificate may be current dated i.e. it may be issued not later than three months of the date of the opening of the tender.

2.15: On 27.12.2002 the MTNL issued a corrigendum bearing No. AGM (MM-II)/ MM-15/ NO-DIG/ 2002-2003/40 (hereinafter referred to as "the 1st corrigendum") whereby it made changes in the "work units" and, consequently, in the "total working quantity units" in respect of items 2b and 9 of Package B and items 2b, 4 and 9 of Package A. As a result of these changes in the work units the Grand total of the "working quantity units" in respect of the said two packages also changed; in respect of Package A it changed from 49,18,478.00 to 46,68,628.00 and in respect of Package B it changed from 22,63,877.00 to 21,26,987.00.

The changes that were brought about by the said 1st corrigendum were as under:-

Page No.

Item Given as Read as Work Unit Total Wkg Work Unit Total Wkg.

Qty Unit   Qty Unit

P-27 2b) More than 3 Pipes        

  to 6 Pipes, 0.70 2100.00 0.070 210.00

P-28

9) Drawing of OFC Cable        

  through HOPE Pipe 0.50 150000.00 0.050 15000.00

P-28 Total   2263877.00   2126987.00

P-30 2b) More than 3 Pipes        

  to 6 pipes 0.70 45500.00 0.070 4550.00

P-30

4) Rope Laying in the        

  pipe   257500.00   247500.00

P-30

9) Up to Copper Cable        

  of 400 Pairs.

0.50 200000.00 0.050 20000.00

P-30 Total   4918478.00   4668628.00

According to the Petitioners in CW 1001/2003 the 1st corrigendum was, in fact, meaningless since the rates to be quoted were "package rates" and not in respect of any particular item of work9. On the other hand MTNL specifically denied that the said 1st corrigendum was meaningless. It submitted that MTNL had fixed the "work units" or base rates of items which ultimately forms the package and would have ultimately affected the quotations which each of the bidders was required to give under the said NIT10.

2.16: The Petitioners in CW 1001/2003 and several others submitted their bids on or before the last date, i.e. 30.12.2002 up to 1100 hours. In all, intending bidders purchased 41 tender documents. Out of these, only 37 submitted their bids. The Techno-Commercial bids were opened on 1130 hours on 30.12.2002 and 31 of the bidders were found to be techno-commercial viable. As per the said NIT and tender conditions, the financial bids were to be opened later.

2.17: By a letter dated 27.1.2003 (hereinafter referred to as "the 2nd corrigendum") issued to the bidders who were found to be techno-commercially responsive, the Respondent MTNL once again revised the "work units" and "quantities" assigned to some items. The revised formats of pages 27 to 32 of the Bid Documents for financial bids were enclosed with the said letter dated 27.1.2003. By this letter the Respondent MTNL also requested the bidders who had been found techno-commercially suitable to submit their revised financial bid by 11.30 AM on 15.2.2003. It was stated in the said letter of 27.1.2003 that the revised financial bids shall be opened for all responsive bidders on 15.2.2003 at 12.30 hours and that the original financial bid submitted along with the tender opened on 30.12.2002 would be considered invalid and that only the revised financial bid shall be opened and evaluated for all responsive bidders.

2.18: It is at this stage that CWP No. 1001/2003 was filed before this Court, inter alia, praying for:-

"1. A writ order or direction in the nature of certiorari quashing the communication dated 27.01.2003 bearing No. AGM (MN-II)11 MM-15/ NO-DIG/2000-03 of the respondents requiring the petitioners to re-submit their financial bids in respect of NIT No. AGM (MM-II)/MM-15/NO-DIG/2002-2003/10 dated 13.11.2002 for laying of cable by "no dig" method using trenchless technology in jurisdiction of MTNL. Delhi; and

2. A writ or order direction in the nature of mandamus declaring that the relaxation of the eligibility conditions of the aforesaid tender by the respondents after the opening of the technical bids on 13th December, 200212 is illegal and arbitrary.

3. in the alternative to quash the aforesaid tender."

2.19: On 7.2.2003 this Court issued notice to the Respondent to show cause as to why rule nisi be not issued and in the meanwhile, without prejudice to the rights and contentions of the parties, it was directed that the petitioners may submit their revised financial bids as called for by the impugned letter dated 27.1.2003. It was further directed that the Respondents may evaluate but not disclose the outcome of the bids which were to be placed in a sealed cover before this Court and that the contract should also not be awarded till further orders of this Court.

2.20: During the pendency of the said CW No. 1001/2003 the Respondents issued a further corrigendum dated 11.2.2003 (hereinafter referred to as "the 3rd corringendum"), in partial modification of the said letter of 27.1.2003 by which revised financial bids (page 27 to 32) were required to be submitted on before 15.2.2003, inter alia, to the following effect:-

"1. S. No. 9 in the quotes for DGM (CCN)(CCS) at page No. 31 'Drawing of Copper Cable through HDPE Pipe' may be replaced by 'Drawing of copper Cable through HDPE Pipe or direct cable laying without any HDPE Pipe.'

2. xxx

3. The revised financial bid shall be opened for all responsive bidders on 18.2.03 at 12.00 hours in the chamber of DGM (MM-I) at the above given address and these bids should reach this office by 11.30 A.M. on 18.2.03. The financial bid may be clearly marked 'Revised financial bid to be opened on 18.2.03 at 12.00 hours'."

2.21: Being aggrieved by this 3rd corrigendum of 11.2.2003 the Petitioners in CW 1001/2003 sought amendment to the writ petition to include the challenge to the said 3rd corrigendum of 11.02.2003 also. By an order dated 17.2.2003 this Court allowed the Petitioners to carry out amendment and also directed that, in the meanwhile, the financial bids would not be opened till 25.2.2003. These orders were continued from time to time till 12.3.2003 when this Court after hearing the parties at length was of the opinion that the Respondent MTNL should be permitted to open both the financial bids -- original as well as the revised. It further directed that after opening the bids, the same should be placed before the Court in sealed covers and that it would be open for the respondent to give notice to all the successful technically responsive bidders in this behalf. The matter was thereafter posted for hearing on 8.4.2003, which, after some hearing, was adjourned to 9.4.2003 and again to 10.4.2003 when it was finally taken up for hearing and the hearing was concluded on 10.4.2003. Counsel for the Respondents brought the entire bids to Court and informed the Court that under the revised bids all the petitioners in CW 1001/2003 would also be entitled to be distributed the works under both the Packages A and B and to this extent they were successful bidders.

2.22: In the meanwhile, after the issuance of the 3rd corrigendum dated 11.2.2003 the Petitioner in CWP 1225/2003 filed the said writ petition praying that this Court may be pleased to, inter alia:-

"a) Issue a Writ or certiorari and quashing the impugned corrigendum dated 11.2.2003 issued by the respondent whereby they have decided to allot work of direct cable laying without HDPE Pipe in addition to allotting work of laying copper cables through HDPE Pipe and paying the same rate for both the works.

b) Direct the respondent to cancel the tender and call for fresh tender for both the works."

2.23: On 17.2.2003 when this petition (i.e., CW 1225/2003) came up for hearing for the first time before this Court, notice was issued and it was mentioned that in view of the orders passed in CW 1001/2003 no further order was required to be passed in this petition. Since that day, this petition (CW 1225/2003) has been listed for hearing along with the said CW 1001/2003 and has been taken up and finally heard on 8.4.2003 and 10.4.2003.

3. Insofar as CW 1001/2003 is concerned, the issues that arise for our consideration are as under:

(i) The petitioners have alleged that the eligibility conditions as specified in the said NIT and the Bid Documents cannot be relaxed once the tender evaluation process has been set in motion upon the opening of the Techno-commercial bids. This is so because, by a relaxation of eligibility criteria, the respondent MTNL would be in a position to bring in those persons who would otherwise not have been eligible under the original conditions and, thereby, give them favored treatment to the detriment of the petitioners.

(ii) The next issue that is raised in the Petition (i.e., in CW 1001/2003) is with respect to the need for asking for revised financial bids as per the 2nd and 3rd corrigenda dated 27.1.2003 and 11.2.2003. According to the petitioners, if the changes sought to be brought about by these two impugned corrigenda were inconsequential and minor then, there was no need to call for revised financial bids. They further submitted that, if on the other hand the changes were not merely inconsequential but were material deviations from the original NIT conditions then, revised financial bids could not, in any event, be called for and the only option available to MTNL was to call for fresh tenders. The further question, therefore, that arises for our consideration is whether the asking for the revised financial bids on the part of the MTNL is liable to be quashed or not?

3.1: With regard to CW 1225/2003, the challenge is limited to the 3rd corrigendum of 11.2.2003. According to the petitioner the corrigendum of 11.2.2003 changed the very nature of the work inasmuch as it also permitted "laying of copper cables without HDPE pipes". It is alleged that in the original NIT and Bid Documents, there was no provision for laying of copper cables without HDPE pipes. The petitioner further alleges that he was not interested in laying HDPE Pipes and, therefore, showed no interest in the said NIT and, accordingly, did not submit any bid. However, had the provision of laying copper cable directly without HDPE pipe been permitted in the original NIT then the Petitioner would have been interested and would have submitted its bids. It is thus submitted by the petitioner that it has been denied the right to participate in the tender and has been shut out from tender process and, accordingly, the same is bad and liable to be quashed.

4. The questions, therefore, that arise for our consideration are:

I.(a) Whether MTNL could at all have relaxed the eligibility criteria after the Techno-commercial bids were opened on 30.12.2002 at 1130 hours?

(b) If not, whether those persons or parties who came within the zone of consideration only as a consequence of such relaxation in the eligibility conditions should be excluded from the tender process?

II. Whether the 2nd and 3rd corrigenda dated 27.1.2003 and 11.2.2003, insofar as they require the submission of revised financial bids, are liable to be quashed?

III. Whether the 3rd corrigendum dated 11.2.2003 is liable to be quashed inasmuch as it introduces the change in the item at S. No. 9 of Package A whereby "Drawing of Copper Cable through HDPE Pipe" has been replaced by "Drawing of copper Cable through HDPE Pipe or direct cable laying without any HDPE Pipe"?

The answers are :- I(a): No; I(b): Yes; II: No; III: No. The reasons are given below.

Questions I(a) & I(b): Relaxation in Eligibility Conditions:

5. We now take up the questions I(a) and I(b) as regards relaxation in the eligibility conditions.

5.1. It is the Petitioners' contention in CW 1001/2003 that the eligibility conditions set out in Paragraph 1 of Section II of the Bid Documents and in particular those set out in sub-paras (d), (e), (f) and (g) have been relaxed by the Respondent MTNL after the opening of the techno-commercial bids on 30.12.2002 at 1130 hours and thereby have enabled certain bidders including (1) Research Development and Manufacturing Corporation, (2) Gangotri Trade Link Pvt. Limited, (3) Yuvraj Constructions, (4) Richom (Pvt.) Ltd. and (6) KGR Engineers & Contractors to be included in the zone of consideration when they did not satisfy the original eligibility conditions as applicable till the time of submitting the bids i.e., till 1100 hours on 30.12.2002. It is the Petitioners' case that any bidder, who/which did not fulfilll the eligibility criteria set out in the said paragraph and did not submit the documents to be attached with the tender/offer in respect of these criteria as required in terms of paragraph 2 of Section II of the Bid Documents, could not at all have been considered and his/its bids had to be rejected outright as being non-responsive. In support of this contention, the Learned Counsel Mr. Sanghi who appeared on their behalf referred to the last line of paragraph 1 of Section II of the Bid Documents which reads as under:-

"The bidders who do not meet above indicated eligibility conditions will not be considered as compliant and responsive ones and such offers will be rejected."

He also referred to sub-para (xiv) of Paragraph 2 of Section II of the Bid Documents which, so much as is relevant, reads as under:-

"The documents sought vide Para (i) to (x) are to be furnished in order to comply the eligibility and non-compliance of them will result into rejection of bid."

He also referred to paragraph 5.2 of the said section II of the Bid Documents, which reads as under:-

"5.2 Any tender not accompanied with the above prescribed Earnest Money Deposit SHALL BE REJECTED FORTHWITH."

He then referred to paragraph 17.8 which is as under:-

"17.8 No amendment to the tender in any form by the tenderer will be permitted after the opening of tender. Canvassing in any form is forbidden and will be a disqualification."

And, finally, to sub-paragraph (e) of N.B.5 after paragraph 17.20 which is in the following terms:-

"No amendment to the tender in any form by the Tenderer will be permitted after the opening of tenders."

5.2: From the Counter Affidavit filed, it is clear that in the case of Research Development and Manufacturing Corporation, EMD validity was short by a period of six days, i.e. instead of 210 days it was 204 days. In respect of Gangotri Trade Links Pvt. Limited, it was admitted that the solvency certificate which was attached had not been issued within three months of the opening of the tender. In respect of M/s. Yuvraj Construction, Richom Pvt. Ltd. and Kishangarh Granite, it was admitted that as per the terms of the said NIT and Bid Documents the experience certificate that should have been attached by each of these bidders should have related to experience for work awarded by MTNL/DOT/BSNL/PSU's or Basic Service Operators. Such experience certificates were not attached and the certificates that were attached were of a different nature. Again with respect to the K.G.R. Engineers, it was admitted that the firm had not submitted Income Tax Clearance Certificate or audited balance sheet for the turn-over for the year 2001-2002. Despite these facts, the Respondent MTNL sought to justify inclusion of these bidders in the zone of consideration on the basis of some explanation given by them as revealed in the counter-affidavit. We are not impressed by these explanations. When the said NIT and Bid Documents themselves prescribed that bidders who did not meet the eligibility conditions would not be considered as compliant and their bids would be considered as non-responsive and would be rejected, the respondent MTNL had to consider the matter objectively and simply examine the bids based on the prescribed eligibility criteria. If the bids did not conform to the eligibility criteria, there was no question of not rejecting those bids or exhibiting subjectivity by endeavoring to relax the eligibility conditions. The bids that did not conform to the eligibility conditions ought to have been declared as non-responsive and accordingly, ought to have been rejected at the threshold itself.

5.3: In the course of the arguments, it further transpired that these six bidders were not the only ones in whose favor the eligibility conditions had been relaxed after the opening of the techno-commercial bids on 30.12.2002. The Learned Counsel Mr. Dinesh Agnani who appeared on behalf of the Respondent MTNL candidly admitted to this and stated that these relaxations were made in respect of twelve bidders bona fide in view of the explanations given by each of the said bidders and in view of the fact that the relaxations were considered to be only of a minor nature and did not amount to a material deviation and/or result in any alteration in the inter-se ranking of the bidders. This, to our mind, is a very feeble explanation and cannot be given any credence. Where the Bid Documents themselves specifically state that the bids which do not meet the eligibility criteria set out therein would be rejected, there is no scope for any further enquiry or explanation in the matter. On 30.12.2002 when the techno-commercial bids were opened, the Respondent MTNL had to examine as to whether each of the bidders had complied with the eligibility criteria or not. Those who did not, would, at the threshold, have to be declared as non-responsive and their bids would have to be rejected as such. Therefore, in view of this, we find substance in the arguments advanced on behalf of the Petitioners and hold that the Respondent MTNL could not have relaxed eligibility conditions in respect of the aforesaid and other bidders after the techno-commercial bids were opened on 30.12.2002. Accordingly, the bids of all such bidders who had not met the eligibility conditions prescribed under the said NIT and Bid Documents would be deemed to have been rejected as being non-responsive. The question of any further consideration in respect of these bids does not arise, they are out of the tender process.

Question II: Revised financial bids:

6. We now come to the question as to whether the asking for the revised financial bids on the part of the Respondent MTNL is liable to be quashed or not? In this regard the Petitioners in CW No. 1001/2003 have sought a writ, order or direction in the nature of certiorari quashing the 2nd corrigendum dated 27.1.2003 and the 3rd corrigendum dated 11.2.2003 requiring, inter alia, the Petitioners to re-submit their financial bids in respect of the said NIT dated 13.11.2002. It would be pertinent to note that the Petitioners have not challenged the first corrigendum dated 27.12.2002 and have not sought any relief in respect thereof. This is material inasmuch as the changes sought to be made in the impugned second corrigendum dated 27.1.203 are of the same nature as the changes which were brought about by the 1st corrigendum of 27.12.2002. The changes in both the first and second corrigendum related to the revision/change in the "work units" and "quanities" assigned to some of the items.

6.1: It is the Petitioners' case that the asking for the revised financial bids is unreasonable, arbitrary, discriminatory and contrary to the norms of tender process. Mr. Vipin Sanghi, Learned Counsel for the Petitioners submitted that there were only two ways of looking at the matter and in particular the impugned 2nd corrigendum dated 27.1.2003. The two views according to him were as under:-

"1. If the changes in the "work units" and "quantities" were inconsequential and merely cosmetic then there was no need to ask for revised financial bids at all.

2. On the other hand, if the changes in "work units" and "quantities" were not in consequential and/or not cosmetic then they were material changes and in such eventuality there was no question of merely asking for revised financial bids. In fact, the entire tender ought to have been cancelled and fresh tender ought to have been called."

At first blush this may appear to be inescapably clear logic. However, good logic based on faulty premises leads to faulty conclusions. As we have indicated above any change in "work units" or "quantities" necessarily affected the single rate to be quoted by the bidder. So, any such change, by necessary implication, would require a revision in the financial bids or at least an opportunity to all the bidders alike to revise their financial bids. At the same time it must be noted that these changes were such as would affect only the financial bids and were not such which would alter the very nature, scope and dimension of the said NIT. These changes did not (and it is nobody's case that it did) in any manner affect the Techno-commercial bids which had already been opened and evaluated. The changes were specific to the second bids (i.e., the financial bids) which had not yet been opened. Thus, these changes, although material to the financial bids, were inconsequential to the other parts of the tender. If a severable part of a machine goes bad only that part need be replaced. It does not call for the entire machine to be thrown away.

6.2: We now deal with the two Supreme Court decisions relied upon by Mr. Sanghi: Monarch Infrastructure (P) Ltd. Vs. Commissioner, Ulhasnagar Municipal Corporation and Others, and W.B. State Electricity Board Vs. Patel Engineering Co. Ltd. and Others, (2001) 2 Supreme Court Cases 451.

Mr. Sanghi drew our attention to paragraphs 10 and 11 of the decision in Monarch's case (supra) which reads as under:-

"10. There have been several decisions rendered by this Court on the question of tender process, the award of contract and have evolved several principles in regard to the same. Ultimately what prevails with the courts in these matters is that while public interest is paramount there should be no arbitrariness in the matter of award of contract and all participants in the tender process should be treated alike. We may sum up the legal position thus:

(i) The Government is free to enter into any contract with citizens but the court may interfere where it acts arbitrarily or contrary to public interest.

(ii) The Government cannot arbitrarily choose any person it likes for entering into such a relationship or to discriminate between persons similarly situate.

(iii) It is open to the Government to reject even the highest bid at a tender where such rejection is not arbitrary or unreasonable or such rejection is in public interest for valid and good reasons.

11. Broadly stated, the courts would not interfere with the matter of administrative action or changes made therein, unless the Government's action is arbitrary or discriminatory or the policy adopted has no nexus with the object it seeks to achieve or is mala fide."

6.3: He also referred to the following observations in paragraph 12 of the said decision in Monarch's case (supra):

"The High Court had taken the view that if a term of the tender having been deleted after the players entered into the arena it is like changing the rules of the game after it had begun and, therefore, if the Government or the Municipal Corporation was free to alter the conditions fresh process of tender was the only alternative permissible. Therefore, we find that the course adopted by the High Court in the circumstances is justified because by reason of deletion of a particular condition a wider net will be permissible and a larger participation or more attractive bids could be offered."

4.4: From the aforesaid decision of the Supreme Court in Monarch's case (supra), it is apparent that in the facts and circumstances of that case alteration of the conditions was of such a nature that "a wider net would be permissible and a larger participation or more attractive bids could be offered." This is not the case here. The original price bids were confidential and had not been opened and/or disclosed. In fact, the original as well as the revised bids were opened together only after directions from this Court on 22.3.2003. The revision of the price bids was necessitated by the changes in the "work units" and the "quantities" of some items. Such changes would not result in widening of the net and/or larger participation as was the case before the Supreme Court in Monarch's case (supra). Before we leave discussion of Monarch's case (supra), it would be relevant to note that, while on the one hand, the Supreme Court held that the High Court was justified in setting aside the award of the contract in favor of Monarch Infrastructure Pvt. Limited, on the other hand, it held that:-

"public interest in the present case would be definitely served by reason of allowing the tender process to be completed by accepting the highest offer made by Monarch Infrastructure (P) Limited subject to raising its bid to Rs. 42 crores matching with that of Ramchand Mahadeo Rao, though invalid, for Rs.41,51,00,000 for the period of 11 months which he is willing to raise to Rs.42 crores. We are not allowing Konark Infrastructure (P) Ltd. or M/s. Jai Krishna Infrastructure such an opportunity as they had made lower bids."

So, it is clear that the Supreme Court, although it had set aside the award of contract in favor of Monarch Infrastructure in the first instance, allowed the tender process to be completed by accepting the highest offer made by Monarch Infrastructure subject to its raising its bid to Rs.42 crores. In view of these circumstances, it is clear that this decision of the Supreme Court in Monarch's case (supra) does not in any way support the petitioner's contention that the revised bids called for vide the 2nd corrigendum dated 27.1.2003 is liable to be set aside and only the original bids, if at all, are liable to be looked into.

6.4. The Learned Counsel for the Petitioners relied upon the decision of the Supreme Court in W.B. State Electricity Board's case (supra) primarily for the proposition that in a tender process all the players are bound by the instructions to bidders (ITB) and the same should be complied with scrupulously. In particular, the Learned Counsel referred to paragraph 24 of the said decision which is as under:

"24. The controversy in this case has arisen at the threshold. It cannot be disputed that this is an international competitive bidding which postulates keen competition and high efficiency. The bidders have or should have assistance of technical experts. The degree of care required in such a bidding is greater than in ordinary local bids for small works. It is essential to maintain the sanctity and integrity of process of tender/bid and also award of a contract. The appellant, Respondents 1 to 4 and Respondents 10 and 11 are all bound by the ITB which should be complied with scrupulously. In a work of this nature and magnitude where bidders who fulfill prequalification alone are invited to bid, adherence to the instructions cannot be given a go-by by branding it as a pedantic approach, otherwise it will encourage and provide scope for discrimination, arbitrariness and favoritism which are totally opposed to the rule of law and our constitutional values. The very purpose of issuing rules/instructions is to ensure their enforcement lest the rule of law should be a casualty. Relaxation or waiver of a rule or condition, unless so provided under the ITB, by the State or its agencies (the appellant) in favor of one bidder would create justifiable doubts in the minds of other bidders, would impair the rule of transparency and fairness and provide room for manipulation to suit the whims of the State agencies in picking and choosing a bidder for awarding contracts as in the case of distributing bounty or charity. In our view such approach should also be avoided. Where power to relax or waive a rule or a condition exists under the rules, it has to be done strictly in compliance with the rules. We have, therefore, no hesitation in concluding that adherence to the ITB or rules is the best principle to be followed, which is also in the best public interest."

6.5. There are several distinguishing features between the case at hand and the one before the Supreme Court in the case of W.B. State Electricity Board (supra). The most important of them being that the correction of the errors and/or mistakes that were sought to be made were in the bids made by bidders and not in the notice inviting the tender or the Bid Documents. This is apparent from paragraph 15 and 16 of the said decision in W.B. State Electricity Board's case (supra) which clearly shows that the bidders (Respondents 1 to 4 therein) had committed mistakes in quoting the unit price as regards a few items of work. A mistake was also committed with regard to the total amount. These are mistakes which have been committed by the bidders in respect of their price bids and, the Supreme Court, held that such mistakes cannot be permitted to be corrected once the bids have been opened. It is also important to note that the tender in question before the Supreme Court in that case was a global tender which entailed international competitive bidding where, in the words of the Supreme Court itself, "the degree of care required in such a bidding is greater than in ordinary local bids of small works". The Supreme Court clearly held as pointed out above that the permission to correct mistakes in a bid by a bidder would amount to a favor being granted to one bidder and would create justifiable doubts in the minds of other bidders and would impair the rule of transparency and fairness and provide room for manipulation to suit the whims of the State agencies in picking and choosing a bidder for awarding contracts. This is certainly not the case here. The correction that is sought to be made is of the same nature which was earlier done in the case of certain items by the 1st corrigendum of 27.12.2002. That correction was not objected to and indeed could not have been objected to as it applied to all, and that too, before the date of opening of the bids. There is no difference between 1st corrigendum and the 2nd corrigendum of 27.1.2003 except that the later corrigendum has been issued after techno-commercial bids have been opened and the financial bids have been submitted although not opened. Mr. Agnani, Learned Counsel for the Respondents has submitted that there were mistakes which were firstly corrected by the 1st corrigendum of 27.12.2002 and subsequently by the 2nd corrigendum of 27.1.2003. Since the price bids had already been submitted based on the 1st corrigendum, in order to avoid any allegation of discrimination and/or arbitrariness, revised financial bids were called when the 2nd corrigendum was issued. He has placed reliance on paragraphs 11 to 13 of his Counter-affidavit which dealt with this aspect in detail and are set out hereinbelow:-

"11. In reply to para 11 it is submitted that since some mistakes were found in the quantity as well as the work unit in or around 7-8 items it was decided to immediately rectify the said mistake and ask all the techno commercial responsive bidders to resubmit their revised financial bids as the financial implications would have been there because of the said mistakes having taken place in the financial bid proforma. It is submitted that the said correction did not relate to the technical/commercial aspect of the NIT and all the techno commercial responsive bidders were asked to submit fresh financial bids so that none of the bidder may feel that he has been discriminated. It is specifically denied that there was no justification for such conduct of the respondent as there were financial implications.

12. The contents of para 12 of the petition are wrong and are denied. It is submitted that from the close scrutiny of the said communication dated 27.1.2003 it would be apparent that mistakes had occurred in the financial proforma of the bid which had financial implications and the answering respondents had to rectify the same. It is submitted that since the mistake had occurred in the base rates of the financial bid, it was necessary to rectify the same as there were financial implications to the bid which had been submitted by the bidders. It is specifically denied that the change in the work unit was an eye wash. It is submitted that whatever difference had crept in had to be rectified as it would have had financial implications and the successful bidders could have at a later stage raised objections with respect to the base rate etc. fixed by the answering respondent. It is further submitted that change in the base rate would have an effect in the total working unit of a particular item. Even if the unit rates per work unit had not been modified, the total value of that particular item would have changed leading to financial implications. It is submitted that the said implications were brought to the notice of each of the bidders whose bid had been found techno commercial compliant before the opening of the financial bids. As such none of the petitioners or any other successful bidders can have objection to the same. It is submitted that the petitioners are trying to confuse the entire issue. As the answering respondents have carried out changes in the individual items which may ultimately affect the total work units of that particular item which may result in financial implications of that very item. Assuming a successful bidder is awarded one particular work such as rope laying in the pipe (see page 47 and page 72 of the paper book) for 1 km. and unit rates quoted by the bidder is Rs.100/- per work unit in that case as per the earlier financial proforma, a sum of Rs.30,000/- would be payable to the contractor for the said work and as per revised financial proforma which is at page 72 of the paper book, the successful bidder will only get only Rs.3,000/- for the said work, as such it is apparent that the financial implications for the same work would change drastically. On coming to know of the said mistake the answering respondent immediately issued the impugned revised financial bid proforma and requested each of the successful techno commercial compliant bidder to furnish its revised financial bid. It is submitted that the answering respondents are not aware as to what were the earlier financial bids of each of the bidders, as such no malafides can be attributable to the answering respondent for asking for revised financial bids and the answering respondent failed to understand as to what objections can each of the bidders have when all of them have been given equal opportunity to revise their financial bids. It is specifically denied that the change in the work unit would not affect the price. In fact from what is stated hereinabove it is apparent that the change in the work unit would have financial implications for that particular work and the successful bidder would get much more than what he would have got had calculations been made as per the earlier financial proforma. Moreover, it is clarified that the answering respondent has not received any representation on this account from any of the parties including the petitioners.

13. The contents of para 13 as stated are not admitted. It is submitted that the financial bids have not yet been opened till date as such the answering respondents are not aware as to who the L-1 bidder is and only after financial bids are opened and evaluated, then the answering respondent would come to know the L-1 bidder."

Clearly, the calling for revised financial bids did not entail any discrimination or favoritism or arbitrariness and applied to all bidders equally. The 2nd corrigendum was an honest attempt at rectification of mistakes which had been found and, in order to be fair to all the bidders alike, revised bids were asked for. There were no mala fides, favoritism or discrimination. All were treated equally. As such, there was nothing wrong with the asking for revised bids and accordingly, the impugned 2nd corrigendum dated 27.1.2003 is not liable to be quashed.

6.6: The Learned Counsel for the Respondent MTNL further submitted that the said NIT dated 13.11.2002 was in respect of two packages A and B and the Petitioner were successful in their bids under the revised financial bids in both packages. He submitted that it was surprising that the Petitioners who were successful in the revised financial bids and who would have independent works awarded to them in terms of the said NIT were challenging the very tender process and had sought for the quashing of the tender. He indicated the possible motive behind this was that the petitioners might want the cancellation of the tender in order to continue the existing arrangement whereunder some of them were carrying out similar works at least till 28.2.2003 (i.e., till when the previous arrangement was extended) at much higher rates. However, we need not dwell upon this aspect of the case and our decision is not coloured or influenced by this.

6.7: As pointed out above, by virtue of paragraph 8 of Section II of the Bid Documents, MTNL had the right to distribute the work between the contractors in any manner that it may decide and no claim would lie against the MTNL by reasons of such distribution of works. Sub Paragraph (j) of Paragraph 8 also provided that both packages A and B would be evaluated separately and relative ranking would be arrived at. It provided that techno-commercial bids would be evaluated first and bids which were found techno-commercially compliant and responsive, would be short listed and that the financial bids of only these short listed bidders would be opened at a later date with due intimation to them. Under Paragraph 8.1 it was clearly provided that the quantity indicated for award of work was only an estimation and actual award of work may vary depending upon prevailing factors and circumstances and that no bidder can have any claim for award of any specific quantity, including quantity indicated in the Bid Document.

6.8: While the techno-commercial bids had been opened for evaluation on 30.12.2002, the financial bids had not been opened at all. In fact, the original financial bids as well as the revised financial bids were opened pursuant to orders of this Court on 22.3.2003. As mentioned above, N.B.5 after Paragraph 17.20 of the said Section II of the Bid Documents clearly stipulated that Tender documents contained the proforma for financial bids (Section-III) and that the rate must not be quoted or disclosed in any other document except in the prescribed Section-III which was to be submitted separately as part of the financial bid. This, clearly implied that there was complete confidentiality as regards the financial bids of the bidders. There is, therefore, no question of the bidders knowing each others' financial bids before the opening of the financial bids.

6.9: Mistakes were discovered in the "work units" and "quantities" in Section III (the financial bids of both packages A and B) and as soon as they were discovered corrigenda were issued firstly on 27.12.2002 and secondly on 27.1.2003. Insofar as the 1st corrigendum of 27.12.2002 was concerned there was no need to ask for revised financial bids as the last date of submission (i.e. 30.12.2002) had not arrived. With regard to the 2nd corrigendum since the bidders had submitted both their techno-commercial bids and financial bids, it became imperative that revised financial bids be called for in view of the corrections made in the "work units" and "quantities" in Section III of the Bid Documents. As indicated above, the financial bid or the Single Rate quoted by the tenderer is a function of (a) the quantities prescribed for each item, (b) the "work units" or base prices fixed by MTNL for each item and (c) the estimated price for each item as estimated by the tenderer. If there is a change in any of these there will be a resultant change in the single rate quoted by the tenderer. Clearly, changes in the "work units" and "quantities" necessitated revised financial calculations and, therefore, it was only fair and reasonable to ask the bidders to submit their revised financial bids. No prejudice would be caused to them inasmuch as the original financial bids had not been opened and their confidentiality was maintained. The asking for revised financial bids did not entail any discrimination or arbitrariness or favoritism as all the bidders were treated at par. There is nothing in law preventing or prohibiting the Respondents MTNL from requiring the bidders to submit revised financial bids.

6.10: Mr. Vipin Sanghi, learned counsel for the petitioners in CW 1001/2003 also placed reliance on the decision of a Division Bench of this Court in Backbone Tarmat-NGJV Vs. National Highways Authority of India & Anr., . In particular he referred to paras 69,70,71 and essentially to the quotation from R.D. Shetty's case (supra) to the following effect:-

"It is a well settled rule of administrative law that an executive authority must be rigorously held to the standards by which it professes respondent's actions to be judged and it must scrupulously observe those standards on pain of invalidation of an act in violation of them."

There can be no exception to this well settled principle. However, legal principles do not exist in a vacuum. They must be applied to particular fact situations. The facts and circumstances of the present case do not disclose any such deviation from prescribed standards. There is no discrimination amongst bidders, no arbitrariness and no unreasonableness in the case of action undertaken by the Respondent MTNL in the present tender process apart from the fact of relaxation of eligibility criteria which we have already held to be invalid.

6.11: In these circumstances, as indicated above, the revised financial bids cannot be quashed and will have to be upheld. As such, we direct that the allotment of work be done by the Respondent MTNL to the successful bidders (excluding those who have not fulfillled the eligibility criteria as above) on the basis of the revised financial bids. We are also informed at the bar that the revised financial bids when compared to the original financial bids also entail a reduction in costs to MTNL to the tune of about Rs.5 crores.

Question III: 3rd Corrigendum & CW 1225/2003.

7. As mentioned earlier the scope of this Writ Petition (i.e., CW 1225/2003) is limited to the challenge of the 3rd corrigendum of 11.2.2003. The contention of the Petitioner in this Writ Petition is that by virtue of this corrigendum they have been denied the right to participate and have been shut out from the tender process and, as such, have prayed that the impugned corrigendum dated 11.2.2003 be quashed.

7.1. Mr. A.S. Chandhiok, Learned Senior Advocate appearing on behalf of the Petitioner drew our attention to the 3rd corrigendum dated 11.2.2003. He submitted that as per paragraph 1 of the 3rd corrigendum dated 11.2.2003, the item at Serial No. 9 in the case of package A (at page No 31 of the Bid Documents) was sought to be changed. In the original Bid Documents Serial No. 9 of package A read as under:-

"Drawing of copper Cable Through HDPE Pipe".

This was sought to be replaced by the following:-

"Drawing of copper Cable Through HDPE Pipe or direct cable laying without any HDPE Pipe."

It is Mr. Chandhiok's submission that as the Bid Documents originally stood his client was not interested as it only entailed drawing of copper cable through HDPE Pipe. However, his client was interested in direct cable laying without any HDPE Pipe. Hence, according to him, had this amended portion been there in the original Bid Documents, the Petitioner in CW 1225/2003 would also have been interested therein and would have submitted its bid. Since it was not there originally, the Petitioner did not submit any bid and, therefore, this subsequent change has shut him out and his right to participate in the tender process has been denied him.

7.2. Mr. Chandhiok, Learned Senior Advocate then referred to the following decisions of the Supreme Court and this Court.

1. Ramana Dayaram Shetty Vs. International Airport Authority of India and Others,

2. Harvinder Singh Arora Vs. Union of India and Others.

3. Paharpur Cooling Towers Ltd. & Anr. Vs. Banbaigaon Refinery & PetroChemicals Ltd. & Ors., 1994 (28) DRJ (DB)

In R.D. Shetty's case (supra) the Supreme Court, inter alia held that the standard of eligibility laid down in the NIT could not be departed with arbitrarily as such departure would amount to denial of equality of opportunity to those who failed by the standard of eligibility and, therefore, did not submit their tenders. The Supreme Court however, further held that the Court in its discretion could refuse relief to the Petitioner who was a nominee of another and had no real interest in the subject matter. In R.D. Shetty's case (supra) the Petitioner therein who did not fulfilll the eligibility standard prescribed in the notice inviting tenders did not, on this account, submit any tender. However, the Respondent No. 4 therein who also was not eligible in view of the standard prescribed in the NIT of the same submitted his tender. At the time of consideration of the tenders, the eligibility condition was relaxed and the contract was awarded to Respondent No. 4. The Petitioner in that case challenged this action on the part of the International Airport Authority. It is in this context that the Supreme Court held that such an action of relaxation of standard of eligibility at the time of considering tenders or applications amounted to denial of opportunity to those like the Petitioner therein who, considering themselves ineligible, did not apply. This is not the case here. The Petitioner in CW 1225/2003 was not shut out from tendering its bid on the ground of some eligibility criteria which has been relaxed at the time of consideration of tenders. In fact, the Petitioner, is entirely wrong in submitting that had the amended item 9 been there in the original Bid Documents, it would have submitted a tender. This is so because, firstly, item No. 2 of the very same form in Section III refers to laying of HDPE Pipe after horizontal boring. This item read with paragraph 17.10 in Section II of the Bid Documents clearly entails that all tenderers must quote rates for all items under Section III and if that is not done their bids would not be considered at all. It, therefore, does not lie in the mouth of the Petitioner to submit that it was only interested in laying copper cable directly without any HDPE Pipe since, in any event, in respect of item 2 which has not been changed, he would have to quote a rate for the same, i.e. for laying of HDPE Pipe after horizontal boring. Secondly, paragraph 1 of Section I of the said Bid Documents (which has been referred to hereinabove) clearly shows that the work of cable laying by trenchless technology comprised of laying the said cable "with or without HDPE Pipe". This has also not changed. Hence, there is no question, on the facts of this case, of the Petitioner being mislead into not submitting their bid. Therefore, the ground that the Petitioner in CW 1225/2003 was denied the right to participate and was shut out from the tender process does not at all arise.

7.3. There is another aspect of the matter. As pointed out by the Learned Counsel for the Respondent MTNL, the initial notice inviting tender dated 13.11.2002 was advertised in the newspapers. As aforesaid, no details regarding laying of cable with or without HDPE Pipe were given therein. The details were to be obtained from the web sites indicated in the said newspaper advertisements. The web sites also did not in any way speak of laying the cable through HDPE Pipes. As such, there is no question of the Petitioner being misled and prevented from participating in the tender on account of the requirement of laying of HDPE Pipes. The Petitioner could only know about item 9 of the tender documents if it had purchased the tender documents. It is an admitted fact that the Petitioner in CW 1225/2003 did not purchase the tender document. Be that as it may, as Mr. Chandhiok, Learned Senior Counsel appearing on behalf of the said Petitioner submitted, the Petitioner may have seen the tender documents purchased by some others and having gone through them realised that it would not be interested. This, however, does not enable the Petitioner to detract from the position that if, indeed, the Petitioner had examined the tender documents it would also have definitely seen item 2 of Section III as well as paragraph 17.10 of Section II and also paragraph 1 of Section I which clearly provided the work of cable laying "with or without HDPE Pipe". Either way, the Petitioner can have no legitimate grouse on this count.

7.4: One of the eligibility conditions for submitting a tender was the ownership of an HDD Machine having minimum 7 Ton capacity. Admittedly, the Petitioner did not and does not have such a machine. In fact, in the earlier tenders floated in December 2001 the Petitioner's bid was found to be technically non-responsive since he did not possess such a machine. The Learned Senior Counsel for the Petitioner suggested that if the Petitioner was interested in the original NIT he could have, within a space of a few days, purchased the said machine. This submission is neither here nor there and does not in any way advance the case of the Petitioner. The eligibility criteria, as mentioned in paragraph 1 of Section II of the Bid Documents and in particular sub-paragraph (a) thereof, clearly stipulated that the intending bidder must own an HDD machine/Guided boring machine either in his/her name or in the name of the firm and documentary evidence such as (1) commercial invoice, (2) Bills of Lading, (3) Custom Bills of Entry, (4) Custom Clearance Receipt etc. were required to be submitted along with the bid and these documents were to be seen in original before issuance of the tender. The packages included items of work and were not limited to item No. 9 alone. It is important to note that in respect of item No. 2 also the said HDD machine was necessary. Apart from the question of amendment in item No. 9, the Petitioner would, in any event, in respect of item No. 2 have required the said HDD machine. It is necessary even in the case of horizontal boring where HDPE Pipes are laid. This contention of the petitioner is, therefore, untenable.

7.5: Another pertinent point is that the clarification and/or amendment introduced in item No. 9 of the impugned 3rd corrigendum dated 11.2.2003 did not have any financial implications whatsoever as the same rate would be paid for item No. 9 whether cable was drawn through HDPE Pipe or directly laid. Mr. Chandhiok, with reference to Harminder Singh Arora's case (supra) (in particular paras 19 and 20 thereof) submitted that where the original terms of the tender notice were changed the petitioner should have been given an opportunity to submit his tender in conformity with the changed terms and as this was not done it caused serious prejudice to the petitioner. This submission is based on the premise that the original terms of the tender notice were changed. As indicated above, this is not the case here. The said NIT and other provisions of the Bid Documents themselves provided that the work of cable laying was "with or without HDPE Pipes". However, this was not reflected in item No. 9 of Package A in Section III in the original set of Bid Documents although it was clearly stated in paragraph 1 of Section I thereof. The 3rd corrigendum dated 11.2.2003 was merely clarificatory and in order to bring item No. 9 in line with the specification for telephone cable laying by "no dig" method using trenchless technology specified in Section I of the Bid Documents itself. As such, there was, in real terms, no change in the original terms of the tender notice/ Bid Documents in this regard. The petitioner, therefore, can derive no assistance from the decision of the Supreme Court in the case of Harminder Singh Arora (supra).

7.6: Reference to the decision in Paharpur Cooling Towers Ltd.'s case (supra) would also be of no help to the petitioner inasmuch as in that case the technical parameters had been changed. In this case, it is seen that there is no such change in technical parameters.

8. In view of the discussions above we hold that:-

1) the relaxation in the eligibility conditions post tender opening are invalid and all those bidders who would not have been eligible at the time of opening of the tender on 30.12.2002 except on account of such relaxation would be deemed to be non-responsive bidders and would not fall in the zone of consideration for awarding the works under the present tender;

2) the works under the said NIT dated 13.11.2002 would be awarded on the basis of the revised financial bids pursuant to the corrigenda of 27.1.2003 and 11.2.2003.

9. Accordingly, CWP 1225/2003 is dismissed and CWP 1001/2003 is partly allowed and disposed of with the aforesaid directions. There shall be no order as to costs.