Delhi High Court
M/S. The Times Travels & Anr. vs Chief Managing Director & Ors. on 21 November, 2008
Author: Manmohan
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ WP(C) No. 1346/2008
Reserved on : November 6th, 2008
% Date of Decision : November 21st, 2008
M/s. The Times Travels
& Anr. ..... Petitioners
Through: Mr. Varinder Kumar
Sharma, Advocate
Versus
Chief Managing Director
& Ors. ..... Respondents
Through: Mr. Lalit Bhasin,
Ms.Ratna, Mr. Zainul and
Ms. Shreya, Advocates.
Mr. Sudhanshu Toma,
Advocate for Respondent
No. 4.
CORAM:
HON'BLE MR. JUSTICE MUKUL MUDGAL
HON'BLE MR. JUSTICE MANMOHAN
1. Whether the Reporters of local papers may be allowed to see the judgment? Yes
2. To be referred to the Reporter or not? Yes
3. Whether the judgment should be reported in the Digest? Yes
JUDGMENT
MANMOHAN, J
1. The Petitioners have filed the present petition under Article
226 of the Constitution read with Articles 14, 15, 16, 19, 20, 21, 39
and 40 of the Constitution of India. By way of this petition the
Petitioners have prayed for quashing of Letter of Intent dated 18 th
January, 2008 issued by the Respondent Nos. 1 to 3 in favour of
Respondent No. 4. It has further been prayed that the tender
dated 15th October, 2007 for hiring of Non-AC CNG Coaches for
staff transportation on point to point basis be awarded to the
Petitioners.
2. The sole submission of Mr. Varinder Kumar, learned Counsel
for Petitioners is that the Respondent Nos. 1 to 3 have awarded
aforesaid tender to Respondent No. 4 who had not even
participated in the tender process. Learned Counsel for
Petitioners contended that after opening of the financial bid, both
the Petitioners, L-1 and L-2 were called for negotiation and after
brining the L-2 to the level of L-1, the Respondent Nos. 1 to 3 had
decided to divide the tender equally between the two Petitioners.
In this context, learned Counsel for the Petitioners placed reliance
on the Petitioner No. 1's own letter dated 26th December, 2007.
3. Learned Counsel for the Petitioners also relied upon the
judgment of the Apex Court in Directorate of Education and
Others Vs. Educomp Datamatics Ltd. and Others reported
in (2004) 4 SCC 19.
4. Mr. Lalit Bhasin, learned Counsel for Respondent Nos. 1 to 3
contended that the tender in question dated 15th October, 2007
was cancelled as the Petitioners had formed a cartel and quoted
exorbitant rates. He stated that in comparison to the existing
rates, the rates offered by the Petitioners contained an additional
financial burden of Rs. 10.7 Lakhs per month or Rs. 130 Lakhs per
year on the Respondent Company. According to Respondents,
there was no reason for hike in the rates because on that date
there was neither any increase in fuel prices nor any additional
levies or additional taxes. Mr. Bhasin submitted therefore, the
Respondent Nos. 1 to 3 decided to exercise the power conferred
under Clause 13 of the tender to terminate/cancel the aforesaid
tender. Mr. Bhasin further stated that only after the cancellation
of the aforesaid tender, the Respondent Nos. 1 to 3 decided to
enter into an interim arrangement with Respondent No. 4 who was
providing similar services to erstwhile Air India.
5. Mr. Bhasin pointed out that, in fact the Respondent Nos. 1 to
3 had floated a fresh tender on 21st July, 2008 inviting bids under
two bid system for hiring of Non-AC CNG Coaches for staff
transportation on point to point basis. He contended that even the
Petitioners had participated in the new tender and after opening of
the financial bids on 22nd September, 2008, it was found that the
Petitioners are not the L-1 parties. He consequently prayed for
dismissal of the present writ petition.
6. The relevant paragraphs of the counter-affidavit are
reproduced hereinbelow for ready reference :-
"9. It was observed by Respondent Management
that M/s. Vivek Travels was L-1 party; M/s. Highway
Travels and M/s. The Times Travels were L-2 parties
as both the parties had quoted same rates for all
the 5 requisite slabs. L-1 and L-2 parties were
called for negotiations as it was stated in Tender
that the Respondent Management will preferably
be engaging two service providers for the entire
job. After negotiations all the three parties i.e. M/s.
Vivek Travels, M/s. The Times Travels and M/s.
Highway Travels offered the same final rates for all
the slabs.
On analyzing the rates quoted by the parties
(including Petitioners) for the job, it was found by
the Respondent Company that;
the three parties i.e. M/s. Vivek Travels, M/s.
The Times Travels and M/s. Highway Travels
had cartelized and offered same final rates
for all the distance slabs.
these rates would have an additional impact
of Rs. 10.76 lacs per month (Rs. 130 lacs per
annum) on the Respondent Company as
compared to existing rates.
It was apparent that there was no reason for hike in
the rates because neither there was any hike in the
fuel rates nor increase in any levies of taxes etc.
which calls for such a high increased in the existing
slab rates. Therefore, hike in rates clearly implies
the cartelization on the part of Petitioners.......
14. ............It is further submitted that the bid of
Petitioners were duly considered by the
Respondent Company and only after examining the
bids and coming up to the conclusion that
exorbitant rates were offered by the Petitioners, the
Respondent Company decided to reject the bid of
the Petitioners as per Clause 13 of the tender dated
15.10.2007.
Clause 13 reads as follows:-
"NACIL reserved the right to accept or
reject any or all bids, annul the tender
process and reject all bids at any time
prior to the award of Contract without
incurring any liability to the Tenderer (s) or
without any obligation to inform the
Tenderer (s) of the ground for its action."
15. It is submitted that in view of the aforegoing,
the decision of the Answering Respondent
Company to reject the bid of the Petitioners and to
offer the work to M/s M.D. Travels was an interim
arrangement and valid.
A fresh tender was issued on 21.07.2008 inviting
quotes under two bid system for hiring of Non-AC
CNG Coaches for staff Transportation on point to
point basis vide Tender No. DGSD/09/STAFF-
TPT/ENQ-06. Last date of submission of Tender was
1500 hours of 13.08.2008. The technical Bids were
opened on the same day at 1530 hours.
The following parties responded to the above
Tender:
(i) M/s. Highway Travels
(ii) M/s. The Times Travels
(iii) M/s. Vivek Travels
(vi) M/s. City Life Line Travels Pvt. Ltd.
(v) M/s. Balaji Services
(vi) M/s. Rao Tourist Services Pvt. Ltd.
The evaluations of the Technical Bids has been
completed. The financial bid of the technically
qualified parties have been opened on 22.09.2008
and the Petitioners are not the L 1 parties........"
7. In rejoinder, learned Counsel for the Petitioner emphatically
denied that the Respondent Nos. 1 to 3 had not executed a
contract with Respondent No. 4 in respect of the same tender
which had been issued on 15th October, 2007. In this context, he
placed reliance on the Respondent's letter dated 18th January,
2008. The relevant portion of the said letter is reproduced
hereinbelow for ready reference:-
"...
TO
M/S. M.D. TRAVELS
OLD PALAM GURGON ROAD,
SAMALAKHA, NEW DELHI.....
Sub: CONTRACT FOR HIRING NON A/C CNG COACHES
FOR TRANSPORTATION ON POINT TO POINT BASIS.
_______________________________________________
SIR,
Please refer our discussion/offer dated 7.1.2008 of
the subject and your letter dated 8.1.2008 wherein you
have agreed to provide NON A C CNG COACHES FOR
TRANSPORTATION ON POINT TO POINT BASIS. We intent
to sign contact/agreement for award of subject service for
routs as per Annexure A for a period from 1.2.2008 to
30.5.2009. The services are to commence w. e. f. 1st shift
of 1st Feb, 2008. The detail agreements containing work
scope, Rates and terms and conditions would be signed
separately."
8. Learned Counsel for Petitioners further contended that the
rates quoted by the Respondent No. 4 were lower as it did not
comply with the tender terms dated 15th October, 2007 like
deposit of Rs. 2 Lakhs as earnest money. He further contended
that the new tender had been floated only because the
Respondent No. 4 had itself given a notice to the Respondent Nos.
1 to 3 to withdraw its services.
9. After hearing the parties we are of the view that Clause 13
of the notice inviting tender gave the Respondent Nos. 1 to 3, the
power to annul the tender process at any stage prior to award of
contract. In the present case, the Respondent Nos. 1 to 3 after
having come to the conclusion that the Petitioners had quoted
exorbitant rates, had cancelled the tender. We find no infirmity
with the decision making process of the Respondent Nos. 1 to 3 as
the power conferred by the tender had been exercised on
reasonable grounds. The judgment cited by the Petitioners'
Counsel is not relevant to the present facts of the case inasmuch
as it holds that the terms of the invitation to tender, being in the
realm of contract, are not open to judicial scrutiny.
10. Though there may be merit in the Petitioners' plea that the
Respondent Nos. 1 to 3 had not entered into an interim
arrangement but had awarded the same tender dated 15th
October, 2007 of hiring of Non-AC CNG Coaches for staff
transportation by way of an agreement dated 18th January, 2008,
we are of the view that this grievance of the Petitioners no longer
survives inasmuch as the said Letter of Intent dated 18th January,
2008 had been terminated and a fresh tender for the same work
had been issued on 21st July, 2008 in which the Petitioners have
also participated, though unsuccessfully. In this view of the
matter and the subsequent development we are not entertaining
this writ petition.
11. Consequently, as the Respondent Nos. 1 to 3 have floated a
fresh tender on 21st July, 2008 and are in the process of awarding
it to the L-1 party, we are of the opinion that the Petitioners are
not entitled to any relief from this Court. Therefore, the present
petition is dismissed but with no order as to costs.
MANMOHAN, J
MUKUL MUDGAL, J
NOVEMBER 21st, 2008
rn/sb
