Delhi High Court
Pink Housing Keeping vs Centre For Development Of ... on 25 October, 2016
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment Reserved on: 28.09.2016
Judgment delivered on: 25.10.2016
+ W.P.(C) 7681/2016
PINK HOUSING KEEPING ..... Petitioner
versus
CENTRE FOR DEVELOPMENT OF
TELEMATICS & ANR. ..... Respondents
Advocates who appeared in this case:
For the Petitioner : Mr Shaad Anwar with Ms Shabnam.
For Respondent No.1 : Mr J.C.Seth with Mr Udit Sethi.
For Respondent No.2 : Mr Balapara Maheshwari K.
CORAM:-
HON'BLE MR JUSTICE BADAR DURREZ AHMED
HON'BLE MR JUSTICE ASHUTOSH KUMAR
JUDGMENT
ASHUTOSH KUMAR, J
1. The petitioner, M/s Pink House Keeping, a contractor of manpower
supply, housekeeping, sanitation, horticulture etc, had participated in the
tender issued by Centre for Development of Telematics (hereinafter
referred to as 'C-DOT' or respondent no.1), a registered scientific society
set up by Government of India to carry out research and development
works in the field of telecommunication, for biennial contract for house
keeping and pest control services at C-DOT campus in Mehrauli, but was
not successful as it was adjudged L-2 whereas the contract was awarded
to respondent No.2 namely M/s Top Servers, another participant in the
tender.
2. The main grievance of the petitioner is that in the financial bid
tabled by the respondent No.2, "bonus" in accordance with Payment of
Bonus Act, 1965 and Rules was not included and therefore the bid of
respondent no.2 was not responsive and if at all, the statutory bonus
would have been included in the financial bid of respondent no.2, only
the petitioner and not respondent No.2 would have been adjudged L-1
and would have been successful in bagging the contract.
3. The respondent No.1 (C-DOT), had invited tenders on 11.03.2016
for housekeeping and pest control services at its office complex situated
at Mandi House Mehrauli, New Delhi. A pre-bid meeting was held on
22.03.2016, wherein the issue of payment of bonus was clarified and the
participants were made to understand that bonus as per law was required
to be included in the price bids.
4. The technical bids of the participants were opened on 07.04.2016
wherein the petitioner and the respondent No.2 along with certain others
qualified whereafter their financial bids were opened on the same day.
The financial bid of the petitioner was evaluated and adjudged as L-2
whereas the respondent no.2 was adjudged as L-1.
5. The respondent No.2, though, had indicated about payment of
bonus in its technical bid, but the amount of bonus was not shown in the
financial bid. The respondent No.1, therefore, sought clarification from
respondent no.2 regarding payment of bonus. Respondent no.2
communicated vide letter dated 15.07.2016 that the rates quoted in the
financial bid was inclusive of all expenses including bonus and that no
extra cost would be charged from respondent No.1. The aforesaid
clarification seems to have satisfied respondent No.1 and thereupon, the
contract was awarded to respondent No.2 on 16.08.2016.
6. The contention of the petitioner is that the financial bid of the
respondent No.2, in the first instance, was non-responsive and secondly,
if bonus would have been added in the financial bid by respondent no.2,
only the petitioner and not respondent No.2 would have been adjudged
the lowest bidder. The petitioner is also aggrieved by the calculation put
forth by the respondent in as much as the calculation has been made on
the basis of 2.5% service charges quoted by the petitioner over the entire
salary, inclusive of statutory payments whereas the petitioner had made it
clear in its commercial bid that the service charges would be on wages
simplicitor.
7. In response to the aforesaid contention of the petitioner, a
comparative chart of the financial bids of the two bidders namely the
petitioner and the respondent no.2 was furnished by respondent No.1
which is as follows:
Sl.No. Manpower/Consumable No. Top Server Pink
Detail Housekeeping
1. Housekeeping Manager 1 16236.25 14924.01
2. Housekeeping 2 26347.96 27514.16
Supervisor (2)
3. Housekeeping 50 542006.50 631500.00
Men/ladies unskilled
4. Plumber 1 13173.98 l3757.08
5. Carpenter 1 13173.98 13757.08
6. Manpower Total- 610938.67 641113.83
I(without service
charges)
7. Rate of Service 1.25 2.50
Charges(%)
Service Charges 7636.73 16027.85
Manpower cost 618575.40 657141.68
inclusive of service
charges) p.m
Sub-Total A (inclusive 7422904.84 7885700.11
of service charges)
P.A.
8. Rodent Control 26 23400.00 7800.00
Services
9. Disinfectation Services 52 15600.00 14400.00
Campus
10. Fumigating Canteen 12 12000.00 3600.00
Stores
11. Eradication of Bats 1 700.00 100.00
12. Catching of Snakes 1 500.00 500.00
13. Beehive Removal 1 500.00 500.00
Sub Total B (per 52700.00 26900.00
annum cost)
14. Consumable (Sub- 12 842052.00 800880.00
Total C) per annum
cost incl. of taxes
Gross Total (A+B+C) 8317656.84 8713480.11
Note:
Sub Total A (Manpower cost) = inclusive of service charges but
exclusive of service tax
Sub Total B (service cost) = exclusive of service tax (SI. No. 8,9,10 are
on per annum basis and SI. No. 11,12, 13 are on requirement basis)
Sub Total C (Consumables) = inclusive of taxes (VAT etc.)
8. From a perusal of the chart referred to above, it would appear that
with respect to both the bidders i.e. the petitioner and respondent No.2,
the calculation was made after adding 2.5% and 1.25% respectively as
service charges on the complete wages which is inclusive of the statutory
payments and not merely wages. In that view of the matter no prejudice
appears to have been caused to the petitioner even though there was a
specific stipulation in the bid of the petitioner that the service charges at
the rate of 2.5% were to be calculated on wages and not other
components namely statutory payments. It was submitted on behalf of the
respondents, in unison, that the bid of respondent No.2 was not at all
unresponsive as a clarification had already been sought to which there
was a specific reply of respondent No.2 that the bid included all payments
and in any event, no extra money would be charged by respondent No.1.
It was further submitted by the respondents that the Supreme Court in
Raunaq International Ltd. vs. I.V.R. Construction Ltd. & Ors. (1999) 1
SCC 492 has reiterated that a Court of law is not required to examine the
bid document clause by clause and would interfere only if the action of
the State is arbitrary or capricious and if any malafide could be shown in
the decision making process.
9. The only plausible grievance of the petitioner, therefore, could be
that if in its financial bid, the respondent No.2 would have had included
'bonus' according to the law in that regard, respondent No.2 would not
have been adjudged the lowest bidder and the petitioner would have been
the only choice for awarding of contract.
10. In order to test the correctness of the aforesaid argument of the
petitioner, we asked the counsel appearing for respondent No.1 to provide
a comparative chart of the financial bids of the petitioner and respondent
No.2 after notional loading of bonus in the bid of respondent No.2. The
chart made after notionally loading the bonus in the commercial bid of
respondent No.2 is as hereunder:
Top Server Pink House
Rs. Keeping
Rs.
Establishment cost including service 74,22,904.84 78,85,700.11
charge as evaluated
Cost of Consumables as evaluated 8,42,052.00 8,00,8800.00
Pest Control Cost as evaluated 52,700.00 26,900.00
Total Price as per Evaluation Report 83,17,656.84 87,13,480.11
Notional Loading of Bonus
(If required by Law) @
583.10 x12 for 55 persons, 3,84,846.00
as per Pink House-keeping Bid
Plus Service charges @ 1.25% if 4,810.57
notional BONUS is loaded
87,07,313.41 87,13,480.11
11. A bare look at the chart would make it obvious that even if the
bonus would have been added in the commercial bid of respondent No.2,
then also the bid of respondent No.2 would have been lower than that of
the petitioner. The issue, therefore, is clinched in as much as in any event
the petitioner could not have been the lowest bidder.
12. That apart, the Supreme Court in Tata Cellular vs. Union of India
(1994) 6 SCC 651 and Asia Foundation and Construction Ltd. vs.
Trafalgar House Construction (I) Ltd. & Ors. (1997) 1 SCC 738 has
decisively laid down the principles of judicial review in contractual
matters namely that it is only intended to prevent arbitrariness or
favouritism and could be resorted to only in larger public interest. What a
court of law is required to see is whether the decision making authority
committed any error so far as the extent of its powers are concerned or
with respect to observance of natural justice and whether there has been
any abuse of the governmental power. If a decision is fair and is not
irrational, no interference is required.
13. There does not appear to be any irrationality or arbitrariness in
accepting respondent No.2 as the lowest bidder and awarding contract to
it.
14. In Heinz India Pvt. Ltd. vs. State of UP (2012) 5 SCC 443, the
Supreme Court, while examining the legal dimensions of judicial review,
quoted the following passage from Reid vs. Secretary of State for
Scotland (1999) 2AC 512:-
"68. ... „Judicial review involves a challenge to the legal
validity of the decision. It does not allow the court of review
to examine the evidence with a view to forming its own
view about the substantial merits of the case. It may be that
the tribunal whose decision is being challenged has done
something which it had no lawful authority to do. It may
have abused or misused the authority which it had. It may
have departed from the procedures which either by statute or
at common law as a matter of fairness it ought to have
observed. As regards the decision itself it may be found to
be perverse, or irrational or grossly disproportionate to what
was required. Or the decision may be found to be erroneous
in respect of a legal deficiency, as for example, through the
absence of evidence, or of sufficient evidence, to support it,
or through account being taken of irrelevant matter, or
through a failure for any reason to take account of a relevant
matter, or through some misconstruction of the terms of the
statutory provision which the decision-maker is required to
apply. But while the evidence may have to be explored in
order to see if the decision is vitiated by such legal
deficiencies it is perfectly clear that in a case of review, as
distinct from an ordinary appeal, the court may not set about
forming its own preferred view of the evidence.‟ (Reid
case [Reid v. Secy. of State for Scotland, (1999) 2 AC 512 :
(1999) 2 WLR 28 : (1999) 1 All ER 481 (HL)] , AC pp. 541
F-H and 542 A)"
15. Thus finding that there is no illegality or irregularity in the decision
making process and the consequent final allotment of contract to
respondent No.2, we do not wish to entertain the present petition any
further.
16. The writ petition is dismissed without costs.
CM 31647/2016
1. In view of the petition having been dismissed, the application has
become infructuous.
2. The application is disposed of accordingly.
ASHUTOSH KUMAR, J
BADAR DURREZ AHMED, J
OCTOBER 25, 2016
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