United Telecom Ltd. vs M.T.N.L. And Anr.
2005 Latest Caselaw 878 Del

JUDGMENT

Anil Kumar, J.

1. This petition is admitted for hearing and taken up for final disposal at this stage on the request of learned counsels for the parties.

2. Petitioner is one of the bidders for a tender floated by respondent No. 1 for supply of 250 K hand held subscribed terminals and 150K fixed wireless terminals based on CDMA (2000x1) technology.

3. Petitioner submits that the technical bids were opened on 13.12.2004 and for package I, petitioner and respondent No. 2 qualified. Thereafter on opening the financial bids, advance purchase order dated 4.4.2005 bearing No. MTNL/20-80(337)/2004-MM/CDMA WILL TERMINALS 2000 X(400 K)/SURANA was issued to respondent No. 2 in respect of package I Type C Category I, though the bid of the petitioner was the lowest on subtracting the price of data cable from the total price quoted as the data cable was not required for package I. Petitioner's case is that in order to ascertain the lowest price, the price quoted for data cable should not have been included or in the price quoted by respondent No. 2 the price of data cable ought to have been added to ascertain the lowest price and if this was done, petitioner would have been the lowest bidder. Petitioner accordingly prays that advance purchase order issued to the respondent No. 2 be cancelled and it be issued to him or the entire new tender process be initiated in respect of package I Type C Category I by the respondent No. 1.

4. The allegation of the petitioner is that in the Special conditions of contract, Section IV, Data Cable is categorically mentioned. Relevant term 13.7 relied on by the petitioner is reproduced for reference:-

"13.7. With reference to clause 1.31.2.2 of Part 2 of TEC GR, for all type of terminals from Type A to Type C, USB cable shall be mandatory and the bidder shall quote and supply as per SOR."

5. The petitioner further contends that in clause 23.3 (a) of instructions to bidder it is stipulated that all inclusive price of terminals, programming tools, R-UIM card, documentation, data cable etc. have to be considered. Therefore, the price of data cable was quoted which has been taken into consideration by the respondent No. 1. The relevant clause 23.3.(a) of instructions to bidders is as follows:-

"23.3. Evaluation of the price bids for each package shall be done separately and ranking of the bidders shall be based on the following criteria:-

(a). All inclusive price of terminals, programming tools, R- UIM card, documentation, data cable etc (Section VII, Part- II, Table +-+). In the case of FWT, cost of feeder cable and patch panel antenna also shall be considered for evaluation."

6. Similarly petitioner has also placed reliance on clause 7.2 of the special condition of contract to substantiate his plea that data cable was to be supplied with package I which clause is as follows:-

"7.2. Evaluation shall be done package wise. The cost of terminals, Data Cables, programming tools, Documentation, RUIM, cost of AMC (at discounted rate of 10% per annum) shall be considered in the evaluation of each package. In case of FWT, feeder cable and patch panel antenna also shall be considered for evaluation. The quantities are indicated in the SOR."

7. According to petitioner, therefore, on conjoint reading of various terms, the price of data cable was quoted as these terms impressioned that data cable was to be supplied and the price of data cable ought to have been be taken into consideration not only in the package price quoted by petitioner but also ought to be included in the prices quoted by the respondent No. 2 in order to ascertain the lowest price for awarding the contract. Alternatively petitioner contended that the price of data cable has been shown is a distinctive item in his tender and separate from the price of other items and in case the data cable is not to be included in package I, as is being canvassed by the respondent No. 1, in that case the price of data cable mentioned by the petitioner separately ought not to be included and be deducted from the total price while comparing the financial bid.

8. The respondent No. 1 has contested the petition by contending that the respondent has already invested huge sum in excess of 220 crores for the commissioning of highly sophisticated and advanced CDMA network and expanding telephone services including the package No. 1 and has already issued advance purchase order to respondent No. 2. According to him interference at this stage would result in huge set back and loss to the entire process of commissioning of the CDMA network resulting in huge cost and loss overrunning in the entire CDMA project. The respondent No. 1 imputes lack of bonafides to petitioner by contending that petitioner was already awarded advance purchase order (APO) for package 2 for approximately Rs. 54 crores and after getting the contract for package 2 the present dispute had been raised with one of his competitors (respondent No. 2) mainly with a view to wholly oust him. The relief sought by the petitioner is wholly impermissible in law by demanding that the bidders who have not quoted price of data cable in their bid, the cost of the same should be added to their package price for the evaluation purpose or the quoted price of data cable of the petitioner be excluded for evaluation. According to respondent No. 1 the petitioner has deliberately tried to confuse the clause relevant to evaluation in special condition of contract which will prevail over other conditions in the contract and requirement as given in SOR (schedule of requirement).

9. Respondent No. 1 categorically contended that the quantities required for each package are detailed in the SOR i.e Schedule of Requirement, have been quoted. In the schedule of requirement for package I, data cables is not stipulated and therefore, package I does not envisage supply of data cables. Mr. Tripathi learned Senior Counsel for the respondent No. 1 submitted that the price quoted by any bidder is sacrosanct for the purpose of evaluation. Therefore, neither the price quoted by the petitioner can be evaluated by deleting the price of data cable quoted by the petitioner from the overall price nor the price of data cable can be included in the prices quoted by other bidders including respondent No. 2.

10. Perusal of the tender document shows that though there is a provision for clarification which is an integral part of the tender document However, the power for modification is very limited. It is limited prior to opening of the financial bid. The provision is under Clause 18 which further specifies that no bid shall be modified subsequent to submission of the bid. Another Clause 23.3 makes it amply clear that evaluation of each package would be done separately and the ranking of the bidders would be on the basis of the inclusive price mentioned by the bidder in the document. The respondent No. 1 has produced the bid prices quoted by different bidders which were encircled and signed by the respective parties at the time of opening of the bids in heir presence.

11. Though after opening the bids in presence of the bidders and encircling the prices quoted by the bidders and their counter signatures, there is a provision for correction or modification in Clause 24, however, it is limited to arithmetic errors only.

The petitioner's contention to deduct the price of data cable which has been quoted by the petitioner, though the data cable was not a part of package I as detailed in the schedule of requirement, such a deduction of price of data cable will not be an arithmetic error as contemplated under Clause 24.1 which reads as under:-

"24.1Arithmetic errors will be rectified on the following basis. If there is a discrepancy, between the unit price and the total price that is obtained by multiplying the unit price and quantity, the unit price shall prevail and total price will be corrected. If there is a discrepancy between the total bid amount and the sum of total prices, the total prices shall prevail and the total bid amount will be corrected. If anywhere, prices are quoted in figures and words and if there is discrepancy between the two, words would prevail."

12. The deletion of the price of data cable from the total price as has been sought by the petitioner is thus not covered under any of the eventualities contemplated in the Clause 24.1. The comparison of the short-listed bids was also to be made on the basis of the final price in ascending order and therefore, there is no justification to deduct the price of data cable from the bid of the petitioner.

13. From the terms of the tender it is also apparent that under Clause 7.2, evaluation had to be done package wise, however, it was for the bidder to stipulate the quantities as mentioned in schedule of requirement (SOR) which is given in Section 5 of the tender bid document. Any bidder either not mentioning or quoting the price of any of the item as mentioned in schedule of requirements or quoting an item which is not in the schedule of requirement will do so at his own risk and the bid cannot be modified or any price added or subtracted from the final price. Clause 13.7 also makes it unequivocally clear that the bidder had to comply and supply as per SOR and, therefore, the contention of the petitioner relying on Clause 23.3 (a), 7.2 and 13.7 does not ensure to his advantage. Once the schedule of requirements does not contemplate an item which is quoted by a bidder, the same cannot be deleted from the total price after opening of the financial bid and in terms of Clause 23.4, the final price had to be compared as given by bidders and not by subtracting or adding anything.

14. Shri Parag Tripathi learned Senior Counsel for the respondent No. 1 has also contended and relied on on (2001) 2 SCC 451; W.B. State Electricity Board v. Patel Engineering Co. Ltd and ors. to contend that power to relax or waive can be exercised only if such power exists under the bid conditions or rules. Otherwise it would create justifiable doubts and would impair the rule of transparency and fairness and would provide room for manipulation for picking and choosing a bidder. Any deletion or addition from the price quoted by the petitioner will result in impermissible advantage to the petitioner whose bid otherwise also merited outright rejection.

15. The respondents noticed various mistakes in the tender of the petitioner which had been highlighted as follows: -

"(i) M/s UTL has quoted for 75,000 Nos. of data cables in package I although it was not required to be quoted.

(ii) M/s UTL has quoted for five Nos. of PC based advance software tools in package I against one required in tender.

(iii) M/s UTL has quoted for 1,37,500 Nos. of data cables in package 2 against requirement of only 27,500 Nos.

(iv) M/s UTL has quoted for 10 Nos. of PC based advanced software tools in package 2 against requirement of only two."

16. In Patel engineering (supra) relied on by the respondent No. 1 there had been a systematic repetitive computer typographical error in quoting the price in Indian Rupees instead of dollars. It was held that a mistake on one side may be a ground for the rescinding, but not for reforming, a contract. Where the minds of the parties have not met there is no contract, and hence none to be rectified. On the general principle of seeking relief in the equity on the ground of mistake, exceptions were also culled out in this judgment. Any deduction as canvassed by the petitioner would be non adherence to tender conditions which may provide scope for discrimination, arbitrariness and favoritism and will be opposed to rule of law. This Court is concerned with the manner in which decision is taken and no arbitrariness is discernible in not deducting the price of data cable which was specifically quoted by the petitioner, may be for whatever reasons. Issuance of APO to respondent No. 2 can not be said to be arbitrary, discriminatory or actuated by malafide or a deliberate act to favor him and, therefore, not liable to set aside when tested on the touchstone of the principles enunciated in different pronouncements of the Hon'ble Supreme Court.

17. Considering all the facts and circumstances and the arguments advanced as detailed herein above, we are of the opinion that the tender committee of respondent No. 2 after going through all the aspects of evaluation of various tenders in accordance with the terms and conditions of the tender had short-listed respondent No. 2 as the lowest tenderer before issuing the advance purchase order to this respondent. No fault can be found with issuance of advance purchase order to respondent No. 2 nor any violation of tender terms are discernible on any of the grounds canvassed before us and there are no reasons for us to interfere with the award of contract by respondent No. 1 to respondent No. 2. The result is that the writ petition of the petitioner seeking getting aside of advance purchase order issued to respondent No. 2 and to set aside the entire tender process in respect of package I, Type C, Category I fails and it is dismissed. However, there will be no order as to cost.