Delhi High Court
M/S. Virtuous Security And ... vs Union Of India And Anr. on 13 October, 2015
Author: Sanjeev Sachdeva
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment Reserved on: 06th October, 2015
Judgment Delivered on: 13th October 2015
+ WP(C) No. 3806/2015 & CM No. 6808/2015
M/S. VIRTUOUS SECURITY AND FACILITY MANAGEMENT
PVT. LTD. ..... PETITIONER
VERSUS
UNION OF INDIA AND ANR. ..... RESPONDENTS
Advocates who appeared in this case:
For the Petitioner : Mr Syed Hasan Isthani, Mr Vikas Yadav and
Mr Rohit Grewal, Advocates.
For the Respondents : Mr Ashish Dholakia and Ms Shradha
Bhargava, Advocates for R-1.
Mr Saket Sikri and Mr Vaibhav Kalra,
Advocates for R-2.
CORAM:-
HON'BLE MR JUSTICE BADAR DURREZ AHMED
HON'BLE MR JUSTICE SANJEEV SACHDEVA
JUDGMENT
SANJEEV SACHDEVA, J
1. The petitioner has filed the present petition impugning the
decision of respondent No. 2 (National Institute of TB and
Respiratory Diseases "NITRD" for short) to scrap the tender dated
25.11.2014 and for directing the respondent No. 2 to issue the Letter
of Intent (LOI) to the petitioner and to quash the process of fresh
tender.
2. The respondent No. 2 had issued Notice for Inviting Tender
(NIT) dated 25.11.2014. The said tender has been scrapped by
respondent No.2 and a fresh NIT dated 30.03.2015 has been issued.
3. It is the contention of the petitioner that the petitioner was L-1
in the tender process initiated through the NIT dated 25.11.2014 and
without any rhyme or reason the said tender process has been
cancelled by respondent No.2 and fresh NIT dated 30.03.2015 has
been initiated.
4. On the contrary, the stand of respondent No.2 is that the
respondent No. 2 had the right to reject all or any of the bids and to
scrap the tender without assigning any reason. It is contended that the
respondents had not yet finalized the tender process consequent to the
NIT dated 25.11.2014 and had neither found the petitioner to be L-1
nor was he declared as L-1 but in fact the bid of the petitioner had
been found to be non compliant. It is contended that at the time of
consideration of the bids in respect of the first NIT, the respondent
No. 2 had come across an Office Memorandum (OM) dated 28th
January, 2014 issued by the Ministry of Finance, Department of
Expenditure directing the Ministry/Departments to consider inclusion
of a clause in the bid documents that "if a firm quotes „NIL‟
charges/consideration, the bid shall be treated as unresponsive and
will not be considered" and for giving effect to the said Office
Memorandum, the first NIT dated 25.11.2014 has been cancelled as it
did not contain the said clause and fresh NIT dated 30.03.2015 has
been issued incorporating the said clause.
5. To resolve the controversy, it would be appropriate to look at
some of ten tender conditions.
6. The instruction No. 2 to "Instructions to Bidders", part of NIT
dated 25.11.2014 stipulates as under:-
"2. NITRD reserves the right to accept or reject
any bid"
7. Instruction No. 10 reads as under:-
"10. The NITRD Delhi does not bind itself to
accept the lowest tender and reserves the right to:
(I) Reject any or all Tenders without assigning
any reason
(II) Accept any tender or part thereof.
8. In the counter affidavit the respondent No.2 has contended that
the bid of the petitioner consequent to NIT dated 25.11.2014 had been
rejected by the respondent No.2. The Petitioner contends that the
rejection was not legal and has not yet been communicated,
9. Since the entire tender process has been scrapped, we are
neither called upon nor are we examining the validity of the rejection
of the bid of the petitioner by respondent No.2. Suffice it to note that
the respondent No.2 had not completed the process of scrutiny of the
bids and declaration of the L-1 at the time the decision was taken to
scrap the tender.
10. In the counter affidavit, the respondent No.2 has taken a stand
that the entire tender process has been quashed in view of the
notification of the Ministry of Finance dated 28.01.2014 to the effect
that all the tenders issued have to include the clause in the bid
document to the effect that if a firm quotes „NIL‟ charges/service
charge consideration, the said bid shall be treated as non-responsive
and will not be considered.
11. The fresh NIT dated 30.03.2015 issued after the cancellation of
the first tender process contains the following note:-
NOTE: (i) As per Office Memorandum No.29(1)/2014-PPD
dated 28.01.2014 Issued by Ministry of Finance
(Department of Expenditure) "If a firm quotes 'Nil'
charges/ consideration, the bid shall be treated as
unresponsive and will not be considered."
12. Learned counsel for the respondent No.2 has produced before
us the Minutes of the Standing Purchase Committee of the respondent
dated 05.03.2015 and 25.03.2015. Perusal of the Minutes dated
05.03.2015 show that the Standing Purchase Committee had not found
the petitioner as qualified. It was proposed to award the contract to
some other bidder. However, in the subsequent meeting held on
25.03.2015, the Standing Purchase Committee, in view of the Office
Memorandum dated 28.01.2014, proposed withdrawal of the proposal
to award the tender to the bidder found qualified on 05.03.2015 and
re-processing of the tender after insertion of the clause as per the
Office Memorandum.
13. As per the NIT dated 25.11.2014, it is clear that the respondent
No. 2 had reserved the right to reject any or all bids and was not
obliged to accept or award the contract to even the L-1. The tender
inviting authority has the right to reject any bid and even scrap the
tender process for valid reasons and provided the right is exercised in
a reasonable manner and without ulterior motives. In the present case,
the respondent No. 2 decided to cancel the NIT dated 25.11.2014 in
view of the Office Memorandum dated 28th January, 2014 of the
Department of Expenditure/Ministry of Finance. It cannot be said that
there was no reasonable cause for the respondent No. 2 to scrap the
tender process and to invite a fresh tender after incorporating the
clause in terms of the Office Memorandum of the Department of
Expenditure, Ministry of Finance. In these circumstances, the action
taken by respondent No. 2 cannot be faulted. Even otherwise, perusal
of the Minutes of the Standing Purchase Committee dated 05.03.2015
and 25.03.2015 show that the petitioner was not declared as L-1 and
the respondent No.2 had not decided to award the contract to the
petitioner. The petitioner, thus, cannot have a grouse with regard to
the cancellation of the tender process consequent to the NIT dated
25.11.2014 and the issuance of a fresh NIT dated 30.03.2015.
14. In view of the above, we find no merit in the petition. The
same is dismissed leaving the parties to bear their own costs. Interim
order dated 20.04.2015 is vacated.
15. We may record that we have not considered on merits and
expressed any opinion on the validity of the rejection of the bid of the
petitioner consequent to the NIT dated 25.11.2014.
SANJEEV SACHDEVA, J
BADAR DURREZ AHMED, J
October 13 , 2015
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