Delhi High Court
Frontline (Ncr) Business ... vs Indian Agricultural Research ... on 26 February, 2016
Author: Sanjeev Sachdeva
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment reserved on: 16th February, 2016
Judgment delivered on: 26th February, 2016
+ WP(C) 12024/2015
FRONTLINE (NCR) BUSINESS SOLUTIONS PRIVATE
LIMITED ..... Petitioner
versus
INDIAN AGRICULTURAL RESEARCH INSTITUTE
& ANR ..... Respondents
Advocates who appeared in this case:
For the Appellant : Mr Saurabh Prakash, Advocate.
For the Respondents : Mr Piyush Sharma for R-1 Mr A.K. Mishra for R-2, Advocates.
CORAM:-
HON'BLE MR JUSTICE BADAR DURREZ AHMED
HON'BLE MR JUSTICE SANJEEV SACHDEVA
JUDGEMENT
SANJEEV SACHDEVA, J
1. The petitioner (M/s Frontline (NCR) Business Solutions Private
Limited) has filed the present petition seeking quashing of two orders
passed by the respondent No. 1, both dated 11.12.2015. By one of the
said orders, respondent No. 1 has awarded the contract for providing
watch and ward/security services at its premises, to Respondent No. 2
(M/s King Security Guards Services Pvt. Ltd.) and by the other order
it has directed the petitioner to hand over the existing charge to
respondent No. 2. The Petitioner has further sought the issuance of the
contract in its favour.
2. By invitation to tender dated 13.08.2015 Respondent No. 1
invited bids for a job work contract for "PROVIDING SECURITY /
WATCH AND WARD SERVICES" at its premises at IARI, Pusa
Campus, New Delhi.
3. Annexure A to the Notice stipulated as under:
"The lARI campus is a self-contained complex
spread over an area of about 500 hectares
(approx. 1250 acres) consisting of research
farm/Held; 38 office buildings/ Laboratories; 8
students hostels, 3 Guest houses; One Shopping
Complex; and number of glass/net houses and
sheds in the farm/field as well as in office
premises. The Institute has also three residential
zones namely Main campus, Krishi Kunj and Loha
Mandi consisting of 1905 Quarters for officers and
staff. The Institute has 8 main gates and 15 small
gates for movement. Whole campus is covered with
the boundary wall. The check section/points may
range 75-80 which will be identified by the
Security Officer in order to maintain smooth and
efficient functioning of the security system in the
whole area. At least 01 four wheeler vehicle and
six motor cycles with Driver/Riders are required
for patrolling and supervising the whole area of
Institute including fields and residential zones. For
overall control and management of security
services at the Campus, qualified and trained Field
Officers and Supervisors are to be provided round
the clock besides gunman as per requirement.
Gunman 3 x 3 =9 (Round the clock)
Motor Cycle Patrolling - 6 with rider = 6 x 3 =
18 (Round the clock)
Supervisor 4 x 3 =12 (Round the clock)
4 wheeler vehicle = 01 with Driver
Agency should deploy Supervisors (Ex-
seiviceman not below the rank of JCO) with
motor cycle to supervise &control the
patrolling party round the clock."
(underlining supplied)
4. The above referred clause shows that the number of security
guards is not fixed and the security officer has to identify the check
points which may range from 75 to 80.
5. Further the relevant clauses of the NIT stipulate that the
agency/contractor shall comply with all the statutory labour laws and
regulations inter alia with regard to minimum wages, employee state
insurance and employee provident fund etc. The relevant clauses read
as under:
"(iv) The agency/ contractor shall be wholly responsible
for paying monthly wages/salaries and other
admissible allowances to the personnel engaged for
security services as applicable laws at the IARI as in
Annexure-A of this tender documents and the institute
shall in no way be responsible for meeting any kind of
expenditure on salaries etc. to these personnel. The
contractor shall be wholly responsible for compliance of
all statutory labour laws/regulations in force and any
contravention of the same or any dispute arising there
from shall be the responsibility of the contractor/firm and
the Institute shall in no way be responsible for meeting any
obligation and liabilities from financial/legal
Implications of the contractor or any other arising there
from. Periodical inspections will be carried out by the
designated officers of the Institute. The institute shall not be
responsible for payment of damages/compensations etc.
for any injury/disablement suffered by the staff of
contractor/Agency during the contract period. "
***** ***** ***** *****
(x) Scrupulous compliance of Minimum Wages Act to
security personnels, EPF Act, ESIC Act. Service tax
shall be ensured by the agency. The Institute shall
pay these statutory charges to the agency as per the
rates stipulated by the GOI/ICAR from time to time.
The agency will be required to disburse wages to
the security personnels through Bank/Cheque and
deposit statutory charges through electronic mode
preferably from the office/Institute to avoid any
delays and strictly in compliance of provisions of all
applicable laws."
(underlining supplied)
6. With regards to the price bid, the notice stipulated as under:
"14. After physical inspection of the site, a detailed
assessment/requirement of personnels for
providing security services at the IARI shall have
to be furnished alongwith the Tender. However,
the Tenders should indicate only the lump-sum
amount in respect of all the services covered under
this contract. No request for alteration in the rates
once quoted will be permitted within one year.
15. The rates to be quoted should include cost of each
and every item including transportation cost,
manpower cost and taxes etc. IARI shall not bear
any extra charge on any account whatsoever i.e.
EPF contribution, ESI contribution, Uniform,
Liveries, OTA etc.
16. The contractor will discharge all his legal
obligations in respect of the workers/supervisors to
be employed/ deployed by him for the execution of
the work in respect of their wages and service
conditions and shall also comply with all the rules
and regulations and provisions of law in force that
may be applicable to them from time to time. The
contractor shall indemnify and keep indemnified
the IARI from any claims, loss or damages that
may be caused to it on account of any failure to
comply with the obligations under various laws. In
case of any dispute, the decision of Director, IARI
shall be final and binding on the contractor.
***** ***** ***** *****
21. The contract is subject to the condition that the
tenderer will comply with all the laws and acts of
Central Govt., State Govt. relating to this contract
made applicable from time to time. All laws and
enactments including concerned minimum wages
for security personnels, EPF, ESIC, Service Tax
etc. should be scrupulously complied by the
contractor. Vague, deficient and such rates as-do
not meet the statutory requirements will not be
accepted.
7. For submission of the price bid, the bidder had to furnish
detailed assessment/requirement of personnels for providing security
services. The Tender however, is to indicate only the lump-sum
amount in respect of all the services covered under the contract. The
rates to be quoted are to include cost of each and every item including
transportation cost, manpower cost and taxes etc. including EPF
contribution, ESI contribution, Uniform, Liveries, OTA etc. Further
the contractor is to discharge all its legal obligations in respect of the
workers/supervisors to be employed/ deployed by him for the
execution of the work in respect of their wages and service conditions
and also has to comply with all the rules and regulations and
provisions of law in force that may be applicable to them from time to
time including concerned minimum wages for security personnels,
EPF, ESIC, Service Tax etc. Vague, deficient and such rates that do
not meet the statutory requirements are not to be accepted.
8. Schedule - II, for submission of Financial Bid reads as under:
"
SCHEDULE - II
FINANCIAL BID
To,
Joint Director (Admn.)
IARI, New Delhi - 110012
Sir/Madam,
I/We wish to submit our Tender for providing
SECURITY/WATCH & WARD SERVICES AT IARI,
PUSA, NEW DELHI on the following rates.
Sl. No. Particulars Rs. Per Month in
figures & in words
1 Monthly charges of a security
Guard for job work/services
contract for providing
Security / Watch & Ward
Services at IARI, Pusa
Campus, New Delhi,
including all material,
transportation, all acts,
minimum wages, EPF, ESIC
& taxes etc (Break up may be
given)
2 Monthly charges of a Security
Supervisor for job
work/services contract for
providing Security / Watch &
Ward Services at IARI, Pusa
Campus, New Delhi,
including all material,
transportation, all acts,
minimum wages, EPF, ESIC
& taxes etc (Break up may be
given)
3 Monthly charges of a Security
Gunman for job
work/services contract for
providing Security / Watch &
Ward Services at IARI, Pusa
Campus, New Delhi,
including all material,
transportation, all acts,
minimum wages, EPF, ESIC
& taxes etc (Break up may be
given)
I/We agree to forfeit of the earnest money if I/we
fail to comply any of the terms and conditions in whole or
in part laid down in the Tender Form.
We have carefully read the terms and conditions of
the Tender and agree to abide by these in letter and
spirit.
Signature_____________________________
Name &Address of the Firm______________
_____________________________________
Telephone No._________________________
Mobile No.___________________________
E-mail.______________________________"
9. A reading of Schedule II shows that the bidders have to submit
the financial bid by separately quoting monthly charges for each
Security Guard, Security Supervisor and Security Gunman and also to
provide breakup of the monthly charges which is to include all
material, transportation, all acts, minimum wages, EPF, ESIC & taxes
etc.
10. There is a clear contradiction between Clause 14 and Schedule
- II. On the one hand, clause 14 requires the bidders to indicate only
the lump-sum amount in respect of all the services covered under the
contract. On the other hand the schedule - II i.e. Financial Bid does
not have any column for a lump sum amount but requires bidders to
quote monthly charges for each Security Guard, Security Supervisor
and Security Gunman and also to provide breakup of each component
for the monthly charge. Another ambiguity that is noticed is that the
number of checkpoints are variable between 75 to 80 and the number
of security guards is not fixed but are variable depending upon the
detailed assessment/requirement of personnel for providing security
services to be furnished by the bidder in terms of clause 14. Further,
the bidders have to comply with the minimum wage as laid down by
the competent government. However, which would be the competent
government, the Delhi government or the Central Government is not
stipulated. Clause 21 requires the bidders to comply with all laws and
enactments of both Central Government and State Government. This
becomes relevant in view of the fact that the minimum wage notified
by both is different.
11. The respondent No. 1 produced the original "note sheet"
containing the details of the various bids received and the evaluation
of the bids by the said respondent.
12. The technical committee comprised of five officials including
the Comptroller's nominee. Total 11 bids were received. On
evaluation of the technical bids, the committee opined that 5 out of 11
bidders did not qualify and as such only six remaining firms were to
participate in the financial bids.
13. On opening of the financial bids, the technical committee noted
the financial bids of the six bidders as under:
"Following particulars/information is put up as per
financial bid.
King Frontline National Everest Kore Good Year
Name of the Security (NCR) Protective Human Security Security
firms Guards Business Security Resource Services Services
Services Pvt. Solutions Services Consultants (Regd.)
Ltd. Pvt. Ltd.
Monthly 19,35,796.83 12,205 15,768.10 14,314.47 11,078.79 16,115.32
charges of a
Security
Guard (All
inclusive)
Monthly 1,55,497.43 13,503 17,365.89 15,836.41 13,466.46 17,705.92
charges of a
Security
Gunman
(All
inclusive)
Monthly 1,88,705.74 13,503 17,756.46 15,836.41 13,466.46 21,431.28
charges of a
Security
Supervisor
(All
inclusive)
Total 22,80,000 - - 28,66,225.67 - 40,42,475.67
(Month)
14. On evaluation of the bids, the committee
observed/recommended as under:
"Observations/Recommendations:-
1. The firm (sr. No. 1) M/s King Security Guards
Services Pvt. Ltd quoted their rates on
consolidated basis of job contract instead of
quoting monthly rates as required in the tender.
As mentioned in our tender 75-80 check points
need to be covered round the clock, it means more
than 200 guards are required for these points in a
day. While dividing the quoted amount i.e. Rs.
19,35,796.83 by 200, it comes to Rs. 9679/- per
month per guard, which is far below the minimum
wages & statutory obligations (Rs. 15,551.54).
Hence, the rates offered by the firm cannot be
considered and rejected.
2. The firm (sr. no. 2) M/s Frontline (NCR) Business
Solutions Pvt. Ltd. has quotes their rates on
monthly basis for a guard, gunman and supervisor
(Rs. 12,205/-, 13,503/- and 13,503/- respectively)
but the same are lower than the prescribed wages
& statutory obligations i.e. Rs. 15,551.54,
17,126.89 and 17,512.11 respectively for guard,
gunman and supervisor. Hence, the rates offered
by the firm cannot be considered and rejected.
3. The firm (sr. No. 3) M/s National Protective
Security Services quoted their rates on monthly
basis for a guard, gunman and supervisor. Quoted
rates (Rs. 15,768.10 for guard, 17,365.89 for
gunman and 17,756.46 for supervisor) are in
accordance with minimum wages, EPF, ESIC and
Service tax, hence the offer of the firm is
considered.
4. The firm (sr. no. 4) M/s Everest Human Resource
Consultants quoted their rates on monthly basis
for a guard, gunman and supervisor (Rs.
14,314.47, 15,836.41 & 15,836.41 respectively)
but the same are lower than the prescribed wages
& statutory obligations i.e. Rs. 15,551.54,
17,126.89 & 17,512.11 respectively for guard,
gunman and supervisor, hence the rates offered by
the firm cannot be considered and rejected.
5. The firm (sr. no. 5) M/s Kore Security services
quoted their rates on monthly basis for a guard,
gunman and supervisor (Rs. 11,078.79, 13,466.46
& 13,466.46 respectively). They have also
mentioned that Service Charge @ 14% will be
applicable on the bill. It is seen that even
excluding the component of Service Tax/charges,
their rates fall short against Rs. 13,641.70,
15023.59 and 15361.50. Hence the quoted rates
are not in accordance with minimum wages &
statutory obligations, the firm's offer cannot be
considered and rejected.
6. The firm (sr. no. 6) M/s Good Year Security
Services (Regd.) quoted their rates on monthly
basis for a guard, gunman and supervisor. Quoted
rates (Rs. 16115.32 for guard, Rs. 17705.92 for
gunman and Rs. 21431.28 for supervisor) are in
accordance with minimum wages, EPF, ESIC &
statutory obligations. Hence the offer of the firm is
considered.
In view of above perusal evaluation and facts, it is
quite evident that only two firms i.e. M/s National
Protective Security Services and M/s Good Year
Security Services (Regd.) only stand eligible for
comparison and consideration.
Based on the requirement given in the tender
document, the consolidated amount for a month for
the Watch and ward/Security work may be
calculated as below, in respect of above
eligible/qualified firms.
1.Security Guard = 75 points (225 Guards round the clock)
2.Security Gunman = 3 points (9 Gunmen round the clock)
3.Security Supervisor = 4 points (12 Supervisors round the clock)
Name of National Protective Security Good Year Security Services
the firms Services
Rate Amount Rate (Minimum Amount
(Minimum wages + EPF +
wages + EPF + ESIC + Service
ESIC + Charge +
Service Charge Service Tax) per
+ Service Tax) month
per month
Guard 225 15768.10 3547822.5 16115.32 3625946.97
nos.
Gunman 9 17365.89 156293.01 17705.92 159353.30
nos.
Supervisor 17756.46 213077.52 21431.28 257175.39
12 nos.
Total - 39,17,193.03 - 4042475.67
In view of above facts, it is clear that M/s National
Protective Security Services have quoted the lowest (L-1)
rates per guard, per gunman, per supervisor/ per month
inclusive of all statutory obligations. Accordingly the
contract of providing Watch and Ward/Security services at
IARI, Pusa, New Delhi may be awarded to the eligible and
lowest quoted firm (L-1) i.e. M/s National Protective
Security Services on standard term and conditions.
(K.K. Kulshreshtha) (S. Neeraj) (Chaman Singh)
Chief Admin. Officer - 1 Admin. Officer - 3 Fin. & Acc. Officer
(Ram Karan) (K.P. Meena)
Asst.Admin. Officer (St) Security Officer
Comptroller/Director"
15. When the observations/recommendations of the technical
committee were put up to the Comptroller, he directed the Finance &
Accounts Officer to examine the bids to determine L - 1 on a
common platform as per GFR.
16. The Finance & Accounts Officer in response observed that
comparison on common platform is difficult as out of 6 technically
responsive tenders, one bidder has quoted lump sum rates, two bidders
have quoted per guard as well as total monthly rate while remaining
three bidders have quoted only per guard rates as called for in the
tender. He reported as under:
"Subject: Proposal for Security/watch & Ward job at IARI
With reference to the remarks on the Page-3/N the
comparison on common platform is difficult as out of 6
technically responsive tenders one bidder has quoted
lump sum rates, two bidders have quoted per guard as
well as total monthly rates while the remaining three
bidders have quoted only per guard rates as called for in
the tender.
However, as per tender notification the scope of work
was 75-80 security points to be manned round the clock
and if we take the minimum No. of points (i.e. 75) into
consideration a minimum of 225 Security guards may be
required apart from 9 Gunmen and 12 Supervisors.
While working out the minimum wages of a guard for 30
days admissible as on the date of opening of tender (i/c
EPF/ESCIC/S.Tax) the minimum payable to a guard for
one shift of 8 hrs comes to Rs.15540/-.
On the basis of total points/scope of work given in the
tender document and rates per guard quoted by the
bidders following amount of quote by different bidders
may be worked out.
King Frontline National Everest Kore Security Good Year
Security NCR Prot. Ser Human Sec
2280000.00 3029688.00 3917193.03 2904226.00 3164096.68 4426476.00 X
(Blue) (Blue) (Blue)
Amount in Blue Ink is worked out for work scope as per
unit rate quoted in the bid. Figures in Black Ink are the
total rates quoted in the bid by the respective bidders.
Submitted for perusal please."
17. The Comptroller on perusal of the report submitted by the
Finance & Accounts Officer directed as under:
"The proposal for Job Contract in r/o Security
Services/Watch & Ward for IARI Campus has been
examined in the light of following facts:-
(1) Documents submitted by 6 nos. of Technically
qualified firms;
(2) Recommendations of Committee and Evaluation of
Financial bids at prepage
(3) Working out the L-1 Bid out of 6 technically qualified
bids on the basis of scope of work as per Annexure -
A of Bidding Document ('X' above)
(4) Outstanding Audit para No.2 (FY 2012-14) in r/o
excess payment for outsourced Security Services (M/s
Frontline Business Solutions, Delhi)
The undersigned after going through the above
parameters recommends the following:-
The invitation of Tender has been specifically advertised
for Job Contract. The same was not based on manpower
or mandays. Hence the L-1 bid evaluation amongst the
technically qualified bids had to be made in that light.
The nature of outstanding Audit para as referred at (4)
above was in the nature of non supply of Attendance
Register of Security personnel of outsourced agency, non
compliance of EPF & ESI act & proof of payment to the
security personnel of outsourced agency was also not
provided by the Office of IARI/Outsourced Agency. In its
reply to Audit para, the Admin. of Institute always
maintained that the Job Contract was given to
Outsourced Agency as per Committee's instructions.
In view of above, it is amply clear that till any revised
guidelines are issued by MOF/ ICAR, the Institute has to
abide by the Job Contract instructions issued by ICAR.
Hence, it is recommended that IARI's Admn. can enforce
the tight control & monitoring of Job Contract without
resorting to the Manpower contract which will be against
the extent guidelines.
Hence from the foregoing analysis, it is recommended
that the award of Job Contract for providing security &
watch and ward may be given to the L-1 Bid as worked
out at prepage ('X') to M/s King Security Guards
Services (Pvt.) Ltd., New Delhi at the monthly rate of
22,80,000/-. This will also reduce the expected annual
liability to the amount of Rs.1.96 cr per annum as the L-1
firm recommended by the Committee at p7/N has been
worked out for monthly quote of Rs.39.17 lakhs.
Submitted for approval."
18. In view of the recommendations of the Comptroller, the
Director, directed as under:
"In view of the above recommendations of the Finance
for the L1 firms (M/s King Security Guards Services Ltd,
ND), it is essential that the L1 firm gives undertaking to
meet all the terms and conditions of the tender. Hence
the 4 firms has to submit the undertaking to the following
Committee - Dr. K.V. Prabhu, JD (R) as Chairman,
Comptroller as member, CAO I as member and Security
Officer as Member, as early as possible. Immediate
necessary action be taken."
19. The note sheet further shows that the respondent No. 2 (M/s
King Security Guards Services Pvt. Ltd.) completed the various
formalities of giving an undertaking and bank guarantee and was
approved as L - 1 for being awarded the work order.
20. The ambiguity in the invitation to tender is further exposed
from the note sheet. There is no clarity as to the number of security
guards required. The tender document states that there are 75 - 80
checkpoints. Which would translate into 225 to 240 security guards
i.e. 75 x 3 or 80 x 3 considering an 8-hour shift with security required
round the clock. The evaluation committee found that four out of six
bidders (including both the petitioner and the respondent No. 2) had
quoted rates below the minimum wage and were thus disqualified.
21. The Finance & Accounts Officer has also stated that
comparison on common platform is difficult as out of six technically
responsive tenders, one bidder has quoted lump sum rates, two bidders
have quoted per guard as well as total monthly rate while remaining
three bidders have quoted only per guard rates as called for in the
tender. He however tried to bring the bids of all the six onto a
common platform by converting the rates quoted by the bidders to
lump sum rate as quoted by respondent No. 2. He assumed the guards
required to be 225 and then multiplied it with the monthly rate quoted
per guard. The rate quoted by the respondent No. 2 was not converted,
as the same was already a lump sum rate. Even though he noted that,
the minimum wage payable to a security guard was Rs. 15540/- he did
not consider it while submitting his report. He also did not take into
account the report of the technical committee that had rejected the bid
of the respondent No. 2 on the ground that if the lump sum rate was
divided by the number of security guards required, it fell way below
the minimum wage. The technical committee had assumed the number
of guards required to be 200 instead of 225 as assumed by the Finance
& Accounts Officer. Calculated based on 200 workers, the monthly
wage had worked out to Rs. 9679/- per month as against the minimum
wage of Rs. 15540/- per month. If the figure of 225 workers were to
be taken, the monthly wage would be still lower.
22. Clearly, the Respondent No. 1 could not have held the bid of
the respondent No. 2 to be compliant and declared the bid of
Respondent No. 2 as L - 1.
23. Not only is the Invitation to Tender ambiguous on various
aspects as noted hereinabove and liable to be set aside, we find that
the evaluation of bids and comparison of rates have also been done in
an illegal manner. The acceptance of the bid of Respondent No. 2 and
its declaration as L - 1 and further the award of contract to it is held to
be illegal.
24. In view of the above, the entire tender process is quashed. The
respondent No. 1 is directed to re-initiate the tender process after
removing the ambiguities in the Notice Inviting Tender.
Consequently, the order dated 11.12.2015 issued by Respondent No. 1
directing Respondent No. 2 to take charge of the Watch and ward
security services from the petitioner is quashed. The order dated
11.12.2015 directing the petitioner to hand over the charge of Watch
and ward security services to Respondent No. 2 is also set aside on the
ground of quashing of the entire tender process. This, however, would
not preclude the respondent No. 1 from taking over charge from the
petitioner in accordance with law. The Writ Petition is allowed in the
above terms. There shall be no orders as to costs.
SANJEEV SACHDEVA, J
BADAR DURREZ AHMED, J
FEBRUARY 26, 2016
HJ/st
