Delhi High Court
Paltech Cooling Towers And ... vs Union Of India And Ors. on 10 November, 2017
$~38
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 9959/2017
PALTECH COOLING TOWERS AND EQUIPMENTS
LTD. AND ANR. ..... Petitioners
Through: Mr Sudipta Basu, Ms Sakshi Mahley
and Ms Harshita Kumar, Advocates.
versus
UNION OF INDIA AND ORS. ..... Respondents
Through: Mr Bhagwan Swarup Shukla, CGSC
with Mr Kamaldeep and Mr Suraj
Kumar, Advocates.
CORAM:
HON'BLE MR. JUSTICE VIBHU BAKHRU
ORDER
% 10.11.2017
VIBHU BAKHRU, J
1. The petitioners have filed the present petition, inter alia, claiming that
the petitioner no.1 - a micro/small enterprise - is entitled to award of the
contract in question, pursuant to its bid as the price quoted by the petitioner
no.1 was within the price band of L-1 + 15%.
2. Briefly stated, the relevant facts necessary to address the present
controversy are as under:-
2.1 Respondent no.2 issued a notice inviting tenders for execution of
"RCC cooling tower and cooling water treatment plant package for PDPP,
Kochi".
2.2 In pursuance of the aforesaid notice, the petitioner submitted its bid
on 13.04.2017. The bids received were subsequently opened and the bid
submitted by one M/s Hammon Shriram Cottrell (P) Ltd. was the lowest and
the said company was declared L-1. Although the financial bid made by the
petitioner no.1 was not the lowest, it was within the band of 15% of the
financial bid of M/s Hammon Shriram Cottrell (P) Ltd.
3. It is the petitioners‟ case that by virtue of the Public Procurement
Policy Order dated 23.03.2012 (hereafter „PPP Order‟), petitioner no.1 is
entitled to the award of the contract as its financial bid was within the price
band of L-1 plus 15%.
4. The PPP Order was issued with the view to support micro and small
enterprises. The relevant extract of the said order, which is relied upon by
the petitioners in support of their contention, is as under:-
"6. Price quotation in tenders %(1) In tender,
participating Micro and Small Enterprises quoting price
within price band of L1+15 per cent shall also be allowed to
supply a portion of requirement by bringing down their price
to L1 price in a situation where L1 price is from someone
other than a Micro and Small Enterprise and such Micro and
Small Enterprise shall be allowed to supply up to 20 percent
of total tendered value."
5. Admittedly, the contract is an indivisible one and it is not possible of
apportion the contract in the manner so as to award 20% of the same to the
petitioner and the balance to another bidder/contractor.
6. The learned counsel for the petitioners submits that in such cases,
micro and small enterprises would be entitled to the entire order. In support
of his contention, he has referred to a press release dated 12.02.2015. He
further submits that the respondents have been implementing the PPP Order
and in the past, certain benefits have been granted to petitioner no.1 as well;
this is by waiver on Tender fee and Earnest Money Deposit (EMD). He
further submits that petitioner no.1 has a legitimate expectation of being
awarded the contract.
7. The contentions advanced on behalf of the petitioners are bereft of
any merit.
8. Admittedly, the contract cannot be split and, therefore, the petitioner
has no legal right to claim that the contract be awarded to the petitioner in
preference of the lowest bidder (L1). The PPP Order, which postulates that
20% of the procurement orders by Central Public Sector Undertakings
(hereafter „CPSUs‟) be awarded to micro and small enterprises is thus, ex
facie, inapplicable in the facts of the present case.
9. The reliance placed by the petitioners on the Press Release dated
12.02.2015 is also misplaced. The said Press Release is set out below:-
"PRESS RELEASE
It has been represented to Ministry of Micro, Small and
Medium: Enterprises that in some cases due to the peculiar
nature of the procurement such as Import Substitution,
Product Development to CPSUs, non-feasibility to break-up
size of the order etc., some of CPSUs prior to the
implementation of the Public Procurement Policy for MSEs
Order 2012 from 1st April 2012, were awarding more than
20% or upto 100% of supplies to the micro and small
enterprises who could match L-1 price where L-1 is quoted
by other than micro and small enterprises.
2. As per the provision 6 of the Public Procurement Policy
for micro and small enterprises quoting the price band of L-
1+15% are allowed to supply upto 20% of the total tender
value provided such micro and small enterprises bring down
their price to L-1. However, it has been brought to notice by
micro and small enterprises that this provision 6 is coming
into the way of earlier higher procurement from micro and
small enterprises in above referred situation at Para-1. It is to
mention that intention of provisions of provision 6 of the
policy is not to restrict earlier high supply opportunity for
micro and small enterprises.
3. In light of the above, it is clarified that in the situation of
L-1 + 15% as mentioned at Para-1 above, CPSUs may take
more than 20% supplies from micro and small enterprises as
per their previous procurement pattern on case to case basis
for which this Ministry has no objection.
4. The above clarification is issued as per the provision
available under Para-16 of the Policy."
10. As is apparent from the above, the press release dated 12.02.2015
merely enables - and not obligates - CPSUs to procure more than 20%
supplies from micro and small enterprises. A plain reading of the said press
release indicates that it was issued as the PPP Order was being read in a
manner so as to restrict the CPSUs, who were sourcing more than 20% of
their requirement from micro and small enterprises, from sourcing more
than 20% of their requirement from micro and small enterprises. The said
release can in no manner be read so as to compel the respondents to award
the entire contract to a micro and small enterprise notwithstanding that such
enterprise is not the lowest bidder.
11. The fact that petitioner no.1 has derived certain benefits by way of
waiver of Tender fee and/or EMD does not in any manner entitle the
petitioners to expect that the contract would be awarded to petitioner no.1
even though petitioner no.1 is not the lowest bidder.
12. The petition is, accordingly, dismissed.
13. No order as to costs.
VIBHU BAKHRU, J
NOVEMBER 10, 2017
RK
