Delhi High Court
Medical Point (I) Ltd. vs Union Of India & Ors. on 8 August, 2011
Author: Sanjay Kishan Kaul
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on : 12.07.2011
% Date of Decision : 08.08.2011
+ WP (C) No.1661/2011
MEDICAL POINT (I) LTD. ...PETITIONER
Through: Mr.T.K.Ganju, Sr.Adv.
with Mr.Siddharth Silwal,
Mr.Dhruv Kapur,
Mr.Vijayender Kumar, Advs.
Versus
UNION OF INDIA & ORS. ...RESPONDENTS
Through: Mr.Ravinder Aggarwal, CGSC
with
Mr.Nitish Gupta, Advocate
for R-1/UOI.
Mr. Mehmood Pracha,
Mr.Sumit Babbar and
Mr.Faraz Iqbal, Advocates for
R-2 and R-3/AIIMS.
Mr. Rajeev K.Virmani, Sr.Adv.
with Ms.Rashmi Virmani and
Mr.Ashish Kothari, Advocates
for R-4/Johnson & Johnson.
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WP (C) No.1661 of 2011 Page 1 of 36
CORAM:
HON'BLE MR. JUSTICE SANJAY KISHAN KAUL
HON'BLE MR. JUSTICE RAJIV SHAKDHER
1. Whether the Reporters of local papers YES
may be allowed to see the judgment?
2. To be referred to Reporter or not? YES
3. Whether the judgment should be YES
reported in the Digest?
SANJAY KISHAN KAUL, J.
1. The petitioner alleges respondent nos.2 & 3, All India
Institute of Medical Sciences (AIIMS) and its Director,
for adoption of Decision Oriented Systematic Analysis
(DOSA) so as to make the tender conditions in respect
of purchase of Gas Plasma Sterilizers tailor-made for
respondent no.4.
2. A notice inviting tender was published by respondent
no.2/AIIMS through its Director/respondent no.3, in the
Times of India on 13.10.2010 for purchase of Gas
Plasma Sterilizers vide Tender Reference
No.XX/131/Ortho/2010-2011/FSC-I. The petitioner
claims to have submitted its tender along with the
relevant documents on 21.10.2010, well before the
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last date of submission of tender dated 15.11.2010.
The tenders were opened as scheduled on 16.11.2010
and the petitioner was called upon by respondent no.2
vide its letter dated 01.02.2011 for a demonstration
meeting on 09.02.2011. The petitioner claims that
though it was present in the demonstration meeting as
scheduled with all original catalogues of Gas Plasma
Sterilizer, it was not able to make available the Gas
Plasma Sterilizer as the same had been put up for
demonstration in another hospital in Ahmedabad and
this fact is stated to have been verbally informed to
respondent no.2. The petitioner addressed a
communication dated 09.02.2011, which was received
by respondent no.2 on 10.02.2011, informing that on
one occasion its Gas Plasma Sterilizer was kept under
trial in the main OT of AIIMS from 17.05.2010 to
22.05.2010 against the tender enquiry no.1-
13/H/M&E/200-10. The petitioner stated that during
that trial, the Gas Plasma Sterilizer had been used for
sterilization of all types of OT instruments including
surgical instruments, endoscopes, lumen items,
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catheters, ET tubes etc. and was found to be as per
the requirement.
3. The grievance of the petitioner is that the tender
conditions included unjustified clause, arbitrary,
unreasonable & discriminatory clauses being
clause/term no. 11 & 14 with the object of awarding
the tender to R-4. The present writ petition under
Articles 226 of Constitution of India which has been
filed on 11.03.2011 seeking quashing of these
clauses/terms being 11 & 14 of the tender. These
specifications are as under:
"11. Should be approved by US FDA, CE &
EPA.
14. The Sterilizer should be recommended
by the IFU's of reputed Device Manufacturers
of endoscopes, bone cutters, arthoscope,
batteries and power tools to ensure
compatibility of sterilizer with instruments."
4. The petitioner has alleged in the writ petition that in
the last one year, seven tenders for purchase of
plasma sterilizers were invited by various departments
of respondent no.2 out of which two have been
awarded to respondent no.4 as their equipment was
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US FDA approved. The petitioner claims to have made
various representations seeking amendment of these
clauses, but to no avail. The representations annexed
show that the first one dated 16.12.2009 was in
respect of a prior tender enquiry no. 53/CNC/NS/09-
10/ST for Advanced Low Temperature (H2O2) Gas
Plasma Sterilizer while the subsequent one dated
13.09.2010 was for tender enquiry
no.47/CNC/CTVS/10-11/ST for Low Temperature
Hydrogen Peroxide Gas Plasma Sterilizer. The
petitioner further pleads that in various other
institutions where tenders were invited for Gas Plasma
Sterilizers, the requirement was for US FDA or CE or
EPA certificate i.e. any one would suffice. The
petitioner admits that he was not able to succeed even
in those tenders because of other restrictive clauses
like past performance.
5. To buttress its arguments in this regard, learned senior
counsel for the petitioner has cited the case of Gharda
Chemicals Limited v. Central Warehousing
Corporation; 118 (2005) DLT 159 (DB) wherein, while
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observing that the eligibility criteria should have a
nexus with the object which is sought to be achieved,
it was stated as under:
"The guidelines (CVC Circular dtd
17.12.2002) highlight the fact that the
purpose of any selection procedure is to
attract the wider participation of reputed
and capable firms. It emphasizes that
while framing any criteria, the scope and
nature of work, experience of the firms in
the same field and their financial
soundness have to be kept in mind."
(emphasis supplied)
Learned senior counsel for the petitioner in this
regard has also referred to the judgment of the
Supreme Court in UOI v. Dinesh Engineering
Corporation ;(2001) 8 SCC 491 wherein it was held as
under:
"Public authorities even in contractual
matters should not have unfettered
discretion and in contracts having
commercial element even though some
extra discretion is to be conceded in such
authorities, they are bound to follow the
norms recognized by courts while dealing
with public property.
....
....
Therefore, merely because the authority
has certain elbow room available for use
of discretion in accepting offer in
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contracts, the same will have to be done
within the four corners of the
requirements of law, especially Article 14
of the Constitution."
6. The writ petition is resisted by the respondents. It is
stated in the counter affidavit filed on behalf of
respondent nos.2 & 3 that the petitioner failed to even
fulfil the requirement of demonstration of the quoted
model as required by tender clause 23 which reads as
under:
"The tenderers may be required to
demonstrate the quoted model of the
equipment during the technical
evaluation, if required, failing which
their bids/offer shall be rejected. The
firms are intimated that they should get
ready for demonstration and only one-
week time will be provided for
arrangement of demonstration and no
request for extending time for
demonstration will be entertained.
Failure to demonstrate, their offer will
be summarily rejected."
(emphasis supplied)
7. The demonstration meeting was scheduled for
09.02.2011 when a representative of the petitioner
was present, but it is an undisputed fact that the
petitioner did not give the demonstration during the
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technical evaluation stage. Despite the failure of the
petitioner, it was given a chance to clarify the
technical points and comply with the technical
specifications. The deficiencies in the case of the
petitioner are stated to be not one but five. No
challenge was laid in the writ petition to any other
condition. In para 7 of the affidavit of respondent
nos.2 & 3, affirmed on 19.03.2011, these deficiencies
have been set out in tabular form, which are as under:
S.No. Technical Specifications Compliance
1. Should be mobile (with The model quoted by the
locking mechanism for petitioner weighed 480
wheels? And should weigh kgs. Compared to
less than 450 kgs. maximum permissible
weight of less than 450
kgs.
2. Should be approved by US Quoted model does not
FDA, CE & EPA have all the required
certificates, but have
only CE instead of all the
three certificates as per
the tender condition and
only self declaration
about EPA approval
instead of EPA certificate
issued by the
Environmental Protection
Agency, United States.
3. The system should use the Quoted model uses 8 ml
minimum quantity of (4 ml x 2 times per cycle)
sterilant to deliver dry sterilant per cycle which
terminal sterilization which is far more than 3-5 ml.
should be less than 3-5 ml per cycle.
per cycle to ensure safety
of instruments against
corrosion.
4. The sterilizer should be The petitioner did not
recommended by the IFUs provide IFUs of the
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of the reputed device reputed device
manufacturers of manufacturer of
endoscopes, bone cutters, endoscopes, bone
arthoscope, batteries and cutters, arthoscope etc.
power tools to ensure Lack of evidence of
compatibility of sterilizer compatibility and
with instrument. efficacy of sterilizer with
instruments used
routinely is potentially
hazardous. Rather to
mislead the respondents,
the Petitioner has
furnished the letters
from the different users
rather than giving the
recommendations from
reputed manufacturers.
5. Sterilant should be in Petitioner has offered the
cassette with leak proof sterilant in 140 ml bottle
indicator and should be air instead of cassette
shippable for easy without leak proof
transportation. indicator.
8. The tender of the petitioner was rejected on all the
aforementioned grounds in pursuance to the order
passed on 22.03.2011. The respondent nos.2 & 3 filed
another affidavit on 10.05.2011 inter alia stating the
reasons how the technical specifications are not met
by the petitioner, the position regarding seven tenders
floated and the rationale for adoption of the US FDA
norms. It has been explained that the US FDA is a
statutory body which certifies that the medical
products, devices and drugs for human use are safe.
Since India does not have any such authority for any
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new technology or drug, reliance was being placed
upon US FDA certification to ensure safety of
equipment, devices etc. for human use. The objective
is stated to be to ensure the safety protocol from the
operational safety point, safety of the patients, safety
of the medical staff and from the environmental safety
point. It has also been explained that while most of
the equipments with FDA have a CE mark, the vice
versa is not true. The CE deals with the European
standards while the FPA deals with the environmental
aspect. The monopoly in favour of respondent no.4 has
been denied as there were various other companies,
other than respondent no.4, who participated in the
tenders earlier floated by various departments of
respondent no.2 and complied with the requirement of
possessing the US FDA certificate.
9. The incorporation of clause 14 as aforesaid requiring
the sterilizer to be recommended by IFUs (Instructions
for Use) of reputed manufacturers of endoscopes,
bone cutters, arthoscope, batteries and power tolls is
to ensure compatibility with instruments and this is
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stated to be a standard practice being followed
elsewhere where the manufacturers recommend use
of a particular type of a product to ensure that the
durability and safety of the device is not compromised
at the user's end.
10. The respondent no.4 was initially not impleaded as a
party as the tender had been awarded. However, on
an application being filed on 03.05.2011, the said
party was impleaded in the present proceedings
keeping in mind the nature of allegations made in the
writ petition and a separate counter affidavit was filed
by the said respondent no.4.
11. In the counter affidavit filed on behalf of respondent
no.4, the attention of this court has been invited to the
compliance statement submitted by the petitioner to
respondent no.2 for purposes of tender, where against
the tender specifications, the petitioner has made the
endorsement "Yes, we comply, certificate attached."
And "Yes, we comply." respectively. It is the say of
respondent no.4 that the petitioner participated in the
tender stating that it complied with the conditions and
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thus having not succeeded in the tender, cannot now
be permitted to turn around and allege that these
clauses were creating a monopoly. This is apart from
the fact that the petitioner has falsely alleged that it
complied with the requirement of impugned clauses
though it did not do so and the petitioner having been
exposed filed the present writ petition.
12. The respondent no.4 has alleged concealment and
misrepresentation of facts before this Court. It is the
say of respondent no.4 that the petitioner had
participated in a previous tender bearing no.1-
13/H/M&E/2009-10 for the same product and had
given documents purported to be IFUs of foreign
manufacturer of devices, which on enquiry, were found
to be non-existent and that tender was scrapped. The
petitioner is stated to be in the know of all the
conditions and even previously participated in the
tenders issued by respondent no.2, while a picture was
sought to be given in the present case as if these
clauses were inserted for the first time. Even in the
earlier tenders, the petitioner was objecting to the
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tender conditions requiring presence in the market for
certain period of time, but no challenge was laid to the
impugned clauses incorporated in those earlier
tenders.
13. The respondent no.4 has sought to rely upon the
judgment of the Supreme Court in K.D.Sharma Vs
SAIL; (2008) 12 SCC 481 to non-suit the petitioner on
this ground alone, relevant portion of which is
reproduced as under:
"The jurisdiction of the Supreme Court under
Article 32 and of the High Court under
Article 226 of the Constitution is
extraordinary, equitable and discretionary. It
is, therefore, of utmost necessity that the
petitioner approaching the writ court must
come with clean hands, put forward all the
facts before the court without concealing or
suppressing anything and seek an
appropriate relief. If there is no candid
disclosure of relevant and material facts or
the petitioner is guilty of misleading the
court, his petition may be dismissed at the
threshold without considering the merits of
the claim.
........
........
While exercising extraordinary power a writ
court would certainly bear in mind the
conduct of the party who invokes the
jurisdiction of the court. If the applicant
makes a false statement or suppresses any
material fact or attempt to mislead the
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court, the court may dismiss he action on
that ground alone and may refuse to enter
into the merits of the case. The rule has
been evolved in the larger public interest
deter unscrupulous litigants from abusing
the process of court by deceiving it."
14. The petitioner is the sole authorized distributor of Gas
Plasma Sterilizer manufactured by Beijing Derun
Technology Co.Ltd., which is the holding company of
MuDanJiang Plasma Physical Application Technology
Co.Ltd. The respondent no.4 has emphasized that the
petitioner has not even filed a document showing its
approval by EPA, but it has filed a letter/declaration
from a private company namely Beijing Derun
Technology Co.Ltd. stating that the plasma sterilizer
being manufactured by that entity and sold by the
petitioner in India are approved by EPA. This is stated
to be, thus, a self-certification from EPA. Even Beijing
Derun Technology Co.Ltd. is stated not to manufacture
the sterilizers as according to the CE certification filed
by the petitioner, it is Mudanjiang Plasma Physical
Application Technology Co.Ltd, which is the
manufacturer of the sterilizer offered by the petitioner.
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The respondent no.4 has also emphasized on the
failure of the petitioner to comply with the conditions
of physical demonstration of the equipment.
15. It is stated by respondent no.4 that as per the
guidelines issued by the Ministry of Health and Family
Welfare in respect of the import of various medical
devices, US FDA and CE approval/certification has
been acknowledged and made acceptable for medical
devices for being eligible for import in India. The
petitioner, it is alleged, cannot call upon this Court to
vary the terms of the tender settled by an expert
body. A reliance in this regard has been placed upon
the judgment of the Supreme Court in Tata Cellular Vs.
Union of India;(1994) 6 SCC 651 where it has been
that the power of judicial review of a Court in
government contracts is a limited one.
16. The said respondent has explained that the Low
Temperature Hydrogen Peroxide Gas Plasma Sterilizer
uses a low-temperature hydrogen peroxide gas plasma
technology to sterilize safely and effectively all the
instruments and medical devices used in operation
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theatres and for invasive procedures and surgeries.
This requires utmost protection to the patients, users,
instruments and environment in healthcare facility.
Such sterilizers exploit the synergism between
peroxide and low temperature gas plasma (an excited
or ionized gas) to rapidly destroy microorganisms. On
completion of sterilization process based on this
technology, no toxic residues remain on the sterilized
items. The technology is particularly suited to the
sterilization of heat and moisture sensitive instruments
used in surgery, like cameras, scopes, batteries,
polymer based reusable instruments, fiber optic cables
etc. since process temperatures do not exceed 500C
and sterilization occurs in a low moisture environment.
The new models of sensitive and expensive medical
instruments and devices are launched periodically.
The new models comprise of combinations of different
metal alloys, polymers and adhesives. These are very
sensitive to temperature, pressure, concentration of
sterilant and time of exposure. Thus, any attempt to
sterilize with such instruments/devices may result in
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improper sterilizing or damage to the devices sterilized
in the sterilizer. It is for this reason that the condition
requiring recommendations by IFUs of reputed device
manufacturers is stipulated.
17. The role of three entities has been explained. The US
FDA is responsible for safety, efficacy and security of
human and veterinary drugs, biological products,
medical devices, food supply, cosmetics and products
that emit radiation by regulating the manufacture,
marketing and distribution of products. The
premarketing approval of all medical devices as well
as overseeing the manufacturing, performance and
safety of these devices is also done by US FDA. The
CE marking on a product is a manufacturer's
declaration that the product complies with the
essential requirements of the relevant European
health, safety and environmental protection
legislation. The United States Environmental Protection
Agency (EPA) has a primary responsibility for enforcing
the environmental statutes and regulations of the
United States. Since the medical institutions in India
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are also now demanding the best available sterilizers
for their institutions, the requirement of US FDA, CE
and EPA approvals ensure that the instruments meet
with the highest standards and there can be no
objection to the expert body providing for highest
standards.
18. The annexures to the counter affidavit show that the
guidelines for import and manufacture of medical
devices in India and the regulatory status inter alia
refer to the US FDA clearance/approval and EU
medical device directive (CE certificate). The CE
marking is actually an abbreviation of French phrase
"Conformite Europeene" which literally means
"European Conformity". It is the manufacturer's
declaration that the product complies with the
essential requirements of the relevant European
health, safety and environmental protection
legislation. On the other hand, the FDA approval
envisages the US Food and Drug Administration
conducting inspections of medical device
manufacturers to ensure that they comply with the
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regulations about the device safety and effectiveness.
If a medical device violates FDA law, FDA can take
action to enforce compliance and ensure public health
- two main tools being Warning Letters and Recalls. US
Environmental Protection Agency (EPA) has a primary
responsibility for enforcing many of the environmental
statutes and regulations of the United States and as
such is granted explicit enforcement authority in
environmental statutes. The EPA regulations help to
ensure that facilities take steps to prevent oil spills,
chemical accidents and other emergencies and
implement planning and response requirements.
19. The petitioner in the rejoinder sought to deal with the
other objections raised by respondent nos.2 & 3 about
the technical feasibility of the sterilizer of the
petitioner. It has emphasized on the circulars issued
by the CVC for purposes of fixation of broad
parameters in cases where the equipment/plant to be
procured is of complex nature and the procuring
organization may not possess the full knowledge of the
various technical solutions available in the market.
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The petitioner has also sought to label the equipment
of respondent no.4 as lacking in technical
specifications since the cycle temperature of
equipment of respondent no.4 is 550C though the
technical specification provides it to be in 40-500C
range.
20. Another aspect emphasized in the rejoinder for the
first time is that it has come to the knowledge of the
petitioner that respondent no.4 has been served with a
Warning Letter issued by the US FDA in regard to
Sterrad 100S (stated to be quoted by respondent no.4
in the tender) and other models to the effect that the
models on inspection were found adulterated. This
model is stated to have been recalled throughout the
world including India. This information is stated to
have concealed by respondent no.4 from respondent
nos.2 & 3. The petitioner has also sought to deal with
each of the technical specifications not complied by it.
So far as the weight of the petitioner's equipment is
concerned, a technical justification is sought to be
given why it is not significant. The petitioner admits
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that it does not have a US FDA certificate though it has
a CE certificate. The EPA certificate is not issued by
the US EPA, but is a self-certification by the
manufacturer. On the issue of minimum quantity
sterilant to deliver dry terminal sterilization to be less
than 3-5 ml per cycle to ensure safety of instruments
against corrosion, this is stated not to be a
disadvantage. Similarly, in respect of the petitioner's
offer of the sterilant in a 140 ml bottle instead of
cassette without leak proof indicator, the same is
sought to be justified. The requirement in respect of
the sterilizer to be recommended by the IFUs is also
stated to be without any basis.
21. In a nutshell, the petitioner seeks to claim that the
though it does not meet with the five parameters as
set out by respondent nos.2 & 3, these should also be
waived or are not essential. Interestingly, another
stipulation of a US FDA approved biological indicator
with 24-hour readout time for faster validation of the
sterilization process is not disputed as apparently the
petitioner complied with the same.
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22. In view of the allegations made by the petitioner
regarding the actions of the US FDA qua respondent
no.4 made for the first time in the rejoinder,
respondent no.4 in pursuance to the leave granted,
filed an additional affidavit affirmed on 04.07.2011. It
has been explained in the affidavit that the letter
dated 12.03.2010 being the Warning Letter by the US
FDA did not cite any product performance, efficacy or
safety deficiencies but rather required improvements
in some of the internal processes of ASP. The Warning
Letter did not lead to recall, seizure or injunction or
any other enforcement action by US FDA. The
registration of the Gas Plasma Sterilizer continues to
remain in force by US FDA for which the Establishment
Registration and Device Listing Certificate,
downloaded from the website of the US FDA on
02.07.2011, has been annexed to the affidavit. There
is, thus, stated to be no impediment in the sale of the
product in question. There were some problems
detected with the oil mist filter noticed by the ASP in
the year 2008 which were corrected by replacing the
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same with the new filters and providing for more
frequent preventive maintenance actions. Since 2009,
all the sterilizers in question are to be fitted with
improved filters. The recall was stated to be a
voluntary action which was intimated to the US FDA.
23. It is in the conspectus of the aforesaid pleadings of the
parties, that various aspects arise for consideration of
this Court.
WRIT PETITION BEING A BELATED ACTION
24. The first aspect is the plea raised about the delays and
laches on the part of the petitioner in approaching this
Court. The tender was floated on 13.10.2010 and the
tender conditions were known. The petitioner
participated in the tender claiming that it met with all
the requirements. Thus, the petitioner did not make
any grievance at the stage of notice inviting tender
though there could be no doubt in the mind of the
petitioner about the understanding of the terms and
conditions including the impugned clauses. The plea
of learned counsel for the petitioner that the petitioner
understood the clause as requiring approval of either
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US FDA or CE or EPA cannot be accepted in view of the
clear stipulation in the clause and the grievance made
by the petitioner in respect of earlier tender having a
similar condition. It is only after the petitioner failed to
meet these technical specifications that after a period
of five moths from the notice inviting tender, the
petitioner filed the present writ petition.
25. In matters of awarding of tenders, the grievance must
be made immediately before the Court as otherwise it
may result in the tender process itself being delayed
or frustrated. The present case is one where the
challenge is sought to be laid to the terms and
conditions of the notice inviting tender. If the
petitioner was aggrieved by the same, the occasion to
challenge the same arose in October, 2010. Instead of
challenging the conditions at that stage, the petitioner
participated in the tender on the basis of a declaration
that it complied with the terms and conditions and
having not being successful in the tender, on technical
grounds, sought to raise the issue about the terms and
conditions of the tender.
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26. In view of the aforesaid, in our considered view, the
delay on the part of the petitioner in making the
grievance in question is fatal to the present writ
petition and on that ground alone, the writ petition is
liable to be dismissed.
THE CHALLENGE TO THE TWO CLAUSES OF
NOTICE INVITING TENDER
27. The petitioner seeks to challenge clauses 11 & 14 of
the notice inviting tender. The petitioner claims that
the requirement of approval by all the three agencies -
US FDA, CE & EPA - is tailor-made for respondent no.4.
Thus, a reverse engineering process has been
deployed in terms whereof, to achieve the objective of
respondent no.4 succeeding in the tender, certain
conditions have been stipulated. It is, thus, a decision-
oriented systematic analysis (DOSA). It is not disputed
that an expert body of AIIMS sat to make out the
different terms and conditions. This expert body had a
varied membership of the Head of the Department,
Medical Superintendent, Head of the Department of
related discipline, concerned faculty member, an
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external expert to be nominated by the Director of the
related discipline, Joint Secretary (FA), DGHS or his
nominee, the Stores Officer and Financial Advisor. The
original records in this behalf have also been produced
by respondent nos.2 & 3. The composition of the
expert body itself, in our considered view,
demonstrates that experts from varied fields relevant
for the decision making process were involved in
providing the specifications. In this regard, the
Supreme Court has also held in Air India Ltd. v. Cochin
International Airport Ltd & Ors.; (2000) 2 SCC 617 that
the State can choose its own methods to arrive at a
decision and fix its own terms of invitation to tender,
subject to the norms, standards and procedures laid
down, which are not open to judicial scrutiny.
28. The role of the US FDA, CE & EPA has also been
explained and the reason for the stipulation of all
three agencies. In India, there is no authority
providing for any such norms and, thus, respondent
nos.2 & 3 have considered it appropriate to accept the
certification of US FDA which is a compliance and
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enforcement agency. Stringent norms are sought to
be provided specifically keeping in mind the use of the
equipment in question for orthopaedic surgeries. US
FDA conducts inspection of medical device
manufacturers to ensure that there is due compliance
with the regulations in respect of device safety and
effectiveness. Thus, a duly constituted administrative
body looks into the various aspects and the
incorporation of that condition in the tender cannot be
doubted. Insofar as the CE marking is concerned, the
material downloaded from the website shows that the
same is a manufacturer's declaration that the product
complies with the essential requirements of the
European health, safety and environmental protection
legislation. It is, thus, a declaration by the
manufacturer. The EPA certificate is issued in respect
of the environmental aspects and it has been
explained that the said terminology is used for the US
EPA certification. Interestingly, even here, the nature
of the certificates submitted by the petitioner as an
agent for sale of the Chinese products leaves
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something to be desired as they are not issued by the
relevant agencies, the same being in the nature of
self-certification. A decision taken by such an expert
body consisting of varied persons of different fields
coupled with the participation in the tender of more
than one technically qualified party belies the plea of
the petitioner that the exercise was a DOSA with the
object of favouring respondent no.4.
29. The grievance raised by the petitioner in respect of
clause 14 requiring the sterilizer to be recommended
by IFUs of device manufacturers see also meet the
same fate. The rationale for this has been duly
explained by both the sets of respondents i.e. the
sterilizer when used with the relevant equipment must
be compatible so that there are no complications.
Such a condition cannot be said to be a mindless
exercise or an exercise to favour respondent no.4.
NON CONFORMITY AND MIS -DECLARATION BY
THE PETITOINER
30. It is an undisputed position that the petitioner while
submitting the tender has categorically stated that it
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complied with the clauses/terms 11 & 14 which it
subsequently sought to challenge. These, declarations
were found to be false. There can be really no dispute
about it. The petitioner had full knowledge that it did
not comply with these conditions yet sought to
indicate in the compliance statement, at the relevant
page, that it complied with it. The petitioner cannot
be permitted to say that since the certificates in its
favour were available and were annexed, it makes no
difference. The petitioner clearly gave a false
declaration in the compliance statement.
31. The matter is not only concerned with the two
clauses/terms impugned by the petitioner, but the
other non-compliance on the part of the petitioner. It
is once again undisputed that the petitioner did not
comply with clause 23 which required a
demonstration. On the relevant date, the
representatives of the petitioner were present, but
without the equipment which was stated to be
unavailable due to a demonstration elsewhere. The
petitioner sought to cover up its failure by claiming
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that in respect of an earlier tender, the equipment had
been made available. This can hardly be a justification.
The petitioner could have been knocked out at that
stage itself, but the respondent nos.2 & 3 in their
wisdom still decided to look into the aspect of
technical requirements being met by the petitioner.
The petitioner failed to comply even with other
technical specifications in respect of weight of the
instrument not being less than 450 kg, the system
using the minimum quantity of sterilant, the sterilant
to be in cassette with a leak proof indicator. The
petitioner cannot be permitted to say that even these
conditions, which the petitioner claims to have
complied with in its compliance statement, which in
fact it did not comply with, should be treated as
irrelevant. The petitioner seeks to re-write the tender
conditions to suit its own convenience. It is not the
function of this Court to re-write a tender which has
been finalized by an expert body. The reliance placed
by the petitioner on the CVC guidelines is misplaced
for the reason that they deal with a situation where
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the decision making body may not have expertise in
the matter. The AIIMS can hardly be said to be a body
not having expertise to deal with the nature of medical
equipments it seeks to purchase. The petitioner, thus,
clearly failed to fulfil various clauses of the tender
conditions and on such failure belatedly sought to
challenge some of the conditions. In our considered
view, there can be no doubt that the petitioner was
rightly technically disqualified.
THE ALLEGATION OF THE PETITIONER OF NON-
COMPLIANCE BY RESPONDENT NO.4 AND THE
WARNING LETTER BY US FDA TO RESPONDENT
NO.4
32. The petitioner not being successful in the tender itself,
seeks to make allegations against respondent no.4 so
that respondent no.4 is knocked out and a fresh
tender process is initiated. One of the pleas raised is
that of non-conformity of a condition of the tender by
respondent no.4. This is regarding the requirement of
a cycle temperature of 40-500C while in case of
respondent no.4 the cycle temperature of its
instrument, as per brochure, is 550C. The respondent
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no.4 has explained that the cycle temperature of its
product is stated to be less than 550C in the brochure
while the white paper provided by respondent no.4
with the tender clearly states that the cycle
temperature of its sterilizer is reported to be less than
500C. There is, thus, no mis-declaration in this case by
respondent no.4.
33. Learned counsel for respondent nos.2 & 3 rightly
pointed out that the scrutiny of the tender was still in
progress when the petitioner approached this Court
seeking to stall it. It is always open to respondent
nos.2 & 3 to seek necessary clarifications in this behalf
from respondent no.4. As far as the effect of Warning
Letter is concerned, the additional affidavit filed by
respondent no.4 lucidly explains the position. The
powers of FDA were earlier explained which included
the power to direct recall of the product or cancellation
by the US FDA. Neither of the two things occurred in
the present case. There was no recall, seizure or
injunction by the US FDA, but on the other hand, the
US FDA certificate continues to subsist in respect of
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the product in question. The recall was with respect to
the oil mist filter and that aspect is stated to have
been corrected. The petitioner can, thus, hardly make
a grievance in this behalf.
THE ALLEGATION OF RESPONDENT NO.4 QUA
THE PETITIONER REGARDING A PAST TENDER
34. At the request of respondent no.4, the records of the
tender no.1-13/H/M&E/09-10 were called for as it is the
plea of respondent no.4 that the petitioner had even
earlier made a false declaration. The bidders as per
the terms and conditions of the tender had submitted
IFUs of reputed device manufacturers. The petitioner
while submitting the tender had given a letter of
endorsement by Olympus Korea Company Limited.
This letter of endorsement dated 26.08.2010 had been
signed by Mr.C.S.Lee as Marketing Manager. The
records of this tender show that respondent no.2
sought a clarification regarding the letter of
endorsement by Olympus Korea Company Limited. On
clarification being sought, respondent no.2 received a
communication from Olympus Medical Systems India
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Pvt. Limited to the effect that as per their Tokyo Office
and Olympus Korea, no such letter had been issued
and there was no Marketing Manager by the name of
Mr.C.S.Lee in Olympus Korea office. A serious note
was taken of this matter with a direction to further
enquire into it. The notings in the file show that the
allegations made qua the certification by a hospital in
Ahmedabad about its user was not found to be correct,
but no final picture could emerge about the
certification from Olympus Korea as no direct
communication was received from Japan. The tender
itself was cancelled. We do feel that the matter should
not have been put to rest only on the basis that the
clarification of petitioner should be accepted of non-
forgery of certificate as the tender was being
cancelled. The local entity Olympus Medical Systems
India Pvt. Ltd. had clarified that no such certificate was
issued. This is stated to have been done on the basis
of verification both from Japan and Korea. The matter
needed to be investigated further. We consider it
appropriate that respondent no.2/AIIMS should look
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into the matter further to verify whether the
certification submitted by the petitioner was fabricated
as undoubtedly grave doubt has been cast on the
same and this may impact any future dealing with the
petitioner.
CONCLUSION
35. We are unequivocally of the view that the present writ
petition filed by the petitioner is belated, the tender
submitted by the petitioner was with wrong
declarations and facts, the petitioner having been
exposed, sought to challenge the terms and conditions
of the tender to somehow prevent the award of the
tender. The explanations forthcoming from the
petitioner as to how he understood the terms and
conditions of the tender are unacceptable in view of an
earlier tender and the stand of the petitioner. The writ
petition is a commercial adventurism by the petitioner
to somehow delay the award of the tender. Also, the
petitioner has not come with clean hands before this
Court.
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36. The writ petition is devoid of any merit whatsoever
and is liable to be dismissed with actual costs as per
the bill of costs and fees filed by the parties in view of
what has been set out hereinabove and the conduct of
the petitioner. The costs payable by the petitioner as
per the bill of costs and fees is, thus, quantified at
Rs.37,000/- to respondent nos.2 & 3 and Rs.14,65,339/-
to respondent no.4. Ordered accordingly.
SANJAY KISHAN KAUL, J.
AUGUST 08, 2011 RAJIV SHAKDHER, J.
dm
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