Delhi High Court
Shree Durga Industry & Anr vs Union Of India & Anr on 28 January, 2020
$~13
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Decision : 28.01.2020
+ W.P.(C) 1362/2019 & CM Nos.6211/2019, 14252/2019,
14269/2019
SHREE DURGA INDUSTRY & ANR ..... Petitioners
Through: Mr.Yashvardhan, Mr.Piyush
Singh, Ms.Kritika Nagpal, Advs.
versus
UNION OF INDIA & ANR ..... Respondents
Through: Mr.M.K.Bhardwaj,
Mr.K.C.Dubey, Advs. for R-1-2.
CORAM:
HON'BLE MR. JUSTICE NAVIN CHAWLA
NAVIN CHAWLA, J. (Oral)
1. This petition has been filed by the petitioners challenging
the order dated 24.01.2019 passed by the respondent no.2,
blacklisting the petitioners for all BSF Public Procurements for
a period of two years from the date of issuance of the Impugned
Letter.
2. The respondent no.2 had floated a tender for procurement
of 'Ply Board (synthetic RESIN Bonded Grade BWR, Type
AA, 19 mm x 11 Ply) with (2100 x 900 mm) fitting material
and fitting charges for Steel Cots Folding Qty.-9645 Nos. to
various HQrs.' vide tender notice dated 11.07.2017.
WP(C)No.1362/2019 Page 1
3. Clause 11.1 of the Tender document required the tenderer
to deposit two pieces of ply wood along with a test report from
any NABL accredited Lab.
4. The petitioner submitted its tender along with a certificate
dated 25.07.2017, which it claimed to have been issued by the
Indian Ply wood Industries Research and Training Institute,
Kolkata (hereinafter referred to as the 'Institute').
5. The respondent, on 19.04.2018, cancelled the tender with
the intent to invite better competition for more participation of
firms. EMD submitted by the petitioners was also returned to
the petitioners on 12.06.2018. Thereafter, the respondent no.2
issued a Show Cause Notice dated 16.08.2018 to the petitioner
alleging that on an inquiry conducted with the Institute, the
Institute had reported that the said certificate is not issued by
the Institute and even the unique sample identification number
mentioned on the same does not match with their data of
samples received. The Show Cause Notice was issued to call
upon the petitioners to show cause as to why it should not be
banned from the business dealings with the respondent no.2.
6. The petitioner by its reply dated 20.08.2018 stated as
under:
"(1) Lab Test Report dated 25.07.2017 was sent
to you inadvertently by our staff vide our letter of
WP(C)No.1362/2019 Page 2
even No. dated 12.07.2017 which was not related
at all in connection with the aforesaid Tender.
Being a human error please condone us.
(2) Actually we intended to enclose the photo
copy of Lab Test Report which we was submitted
originally against the on-line Tender floated by
FTR HQ BSF, Jammu for the same identical stores
and on receipt of AT from them, we had also
executed the same successfully. Photo copies of
said Lab Test Report and Acceptance of Tender
(AT) are enclosed herewith for your kind perusal.
However, you have full liberty to confirm the
genuineness of the same from the concerned Lab as
well from IG, BSF, Jammu who had placed the AT
on us if you so desired.
(3) Our intention was only to convince you by
providing the photocopy of abovementioned Test
Report that we are quite capable to manufacture
the TE stores as because we had no original Lab
Test Report for the TE stores and for which we
could not furnish the same to you in line of Tender
conditions."
7. A reading of the above would show that the petitioners
did not deny that the certificate submitted by it along with the
tender was fake. It, in fact, stated that the same was
inadvertently sent by its staff as the petitioner firm was not in
possession of any original lab certificate as was required in the
tender document.
8. Considering the reply submitted by the petitioner, the
respondent no.2 has passed the Impugned Order.
WP(C)No.1362/2019 Page 3
9. The learned counsel for the petitioner submits that the
tender having been cancelled by the respondent no.2 and the
Earnest Money Deposit (EMD) amount also having been
returned, the Impugned Order could not have been passed
thereafter.
10. I do not find any merit in the said contention. The
cancellation of the tender was on the ground of not having
received adequate number of bids. It does not absolve the
petitioner from the consequence of it having submitted a false
and fake certificate.
11. Clause 2.1 of the tender further made the provisions of
the DGS&D Manual applicable to the tender. Clause 5.18.3(iii)
of the DGS&D Manual empowers the Authority to pass an
order banning the contractor for future tenders on inter-alia the
following ground:
"5.18.3 GROUNDS FOR BANNING OF
BUSINESS DEALINGS: The grounds on which
banning may be ordered are:-
xxxx
(iii) If there is strong justification for believing that
the proprietor or employee or representative of the
firm has been guilty of malpractices such as bribery,
corruption, fraud, substitution of tenders,
interpolation, mis-representation, evasion or habitual
default in payment of any tax levied by law; etc."
12. Clause 5.18.3(iii) was, therefore, rightfully invoked by
the respondent no.2 which passing the Impugned Order. Mere
WP(C)No.1362/2019 Page 4
cancellation of tender on account of non-receipt of adequate
number of bids, cannot absolve the petitioner of its actions or
relieve it of the consequences of such actions.
13. The learned counsel for the petitioner further submits that
in terms of the tender document, the DGS&D Manual was to
apply to the tender. Relying upon Clause 5.18.4 of the DGS&D
Manual, he submits that before passing the Impugned Order, the
procedure as prescribed in the above Clause has not been
followed.
14. I do not find any merit in the said submissions of the
learned counsel for the petitioner. Clause 2.2.3 of the tender
document read as under:
"2.2.3 Under Clause 2 (c)-page 5 of DGS&D
Conditions of contract, the word "Director General of
Supplies & Disposals or heads of his concerned regional
offices" may be replaced by Director General, Border
Security Force, Ministry of Home Affairs. Similarly the
reference to DGS&D wherever appearing may be
suitably modified."
15. A reading of the above would clearly show that for the
tender document, the Director General of Supplies and
Disposals has been replaced by the Director General Border
Security Force as the tender has been floated by the respondent
no.2 and the procurement was for the respondent no.2 only.
WP(C)No.1362/2019 Page 5
Clause 5.18.4 of the DGS&D would therefore, have to be read
in accordance with this amendment. The decision to ban the
petitioner has been taken by the Directorate General BSF, that
is the Competent Authority in terms of Clause 5.18.4 as
modified for the purposes of the tender document. I therefore,
find no infirmity with the Impugned Order.
16. The learned counsel for the petitioners further submits
that the submission of the certificate being an inadvertent error
by the staff of the petitioner, the penalty imposed by the
Impugned Order is highly disproportionate and is therefore,
liable to be set aside by this Court.
17. I again do not find any merit in the said submissions.
18. The allegation made against the petitioner is of grave
nature of having interpolated and submitted a false document to
the respondent no.2. In such cases, no leniency can be shown
to the defaulting party. As has been held by the Supreme Court
in Chief Executive Officer, Krishna District Cooperative
Central Bank Ltd. and Ors. v. K. Hanumantha Rao & Ors.,
(2017) 2SCC 528, the Court can interfere with the quantum of
punishment only when the punishment imposed by the
competent Authority is found to be so shocking in nature so as
to render it totally disproportionate to the offence alleged. In
the present case, I do not find the penalty imposed to be
disproportionate in any manner.
WP(C)No.1362/2019 Page 6
19. The petition is therefore, dismissed. The parties shall
bear their own costs.
NAVIN CHAWLA, J
JANUARY 28, 2020
RN
WP(C)No.1362/2019 Page 7
