Delhi High Court
Shri Swami Samarth Engineers Ltd. vs National Highways Authority Of ... on 12 February, 2021
$~
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Decision: 12.02.2021
+ W.P.(C) 1853/2021, CM APPL. 5361/2021 & CM APPL. 5362/2021
SHRI SWAMI SAMARTH ENGINEERS LTD.
..... Petitioner
Through: Mr. Vinay Navare, Sr. Adv with Mr.
Prashant S. Kenjale, Adv.
versus
NATIONAL HIGHWAYS AUTHORITY OF INDIA
..... Respondent
Through: Mr. Ankur Mittal, Mr. Abhay Gupta
& Mr. Karan Setiya, Advs.
CORAM:
HON'BLE MR. JUSTICE VIPIN SANGHI
HON'BLE MS. JUSTICE REKHA PALLI
VIPIN SANGHI, J (ORAL)
1. The present petition has been preferred by the petitioner/ M/s Shri
Swami Samarth Engineers Ltd. to seek the following reliefs:-
"(i) ISSUE appropriate writ (s) or writ in the nature of
mandamus directing Respondent to withdraw and cancel
the Technical Evaluation Report dated 03.02.2021 and
allow the Petitioner to participate in the bidding process
and clarify and submit any documents necessary;
AND/OR;
(ii) ISSUE appropriate writ or writs to protect the
rights of Petitioner to proper hearing and direct the
Respondent to consider Petitioner's bid in oral hearing;"
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
2. The petitioner, alongwith its joint-venture partner, responded to the
Tender/Request For Proposal (RFP) issued by the respondent/NHAI for 4-
laning of Pangare to Waranga Phata section from Km 134.500 to Km
174.645 (Design Chainage) of NH-161 including Bypasses at Kalamnuri
and Akhada Balapur and additional lengths of 800 m from Waranga
Junction to Nanded (NH-161) (existing Chainage 244.360) and 700 m road
from Waranga Junction (NH-161) to Mahagaon (NH-361) (existing
Chainage 253.700) in the State of Maharashtra on EPC mode. The bid was
submitted in the name of the joint-venture, namely M/s Shri Swami Samarth
Engineers Ltd.-M/s L B Kunjir (JV).
3. Learned counsel for the respondent/NHAI who appears on advance
notice, at the outset submits that the present writ petition is not maintainable,
having been filed by one of the members of the joint-venture. He submits
that if the joint-venture was aggrieved by any decision of the respondent, the
petition should have been preferred by the joint-venture itself and not by one
of the partners solely. We find merit in this submission. The petitioner being
only a member of the joint-venture cannot act singly, and would have no
locus standi to prefer this petition. It is the joint-venture which is the party
dealing with and recognised by the respondent and only the joint-venture
can raise a grievance with regard to rejection of its bid. On this short ground,
this petition is liable to be rejected. However, we have heard the
submissions of learned senior counsel for the petitioner on merits as well,
and so we proceed to deal with them as well.
4. The case of the petitioner is that in response to the bid submitted by
the joint-venture, the respondent had issued a communication on 05.01.2021
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
seeking certain clarifications from the joint-venture regarding its bid. The
relevant extract of the said letter reads as under:
"NHAI/Tech/MH/PangareWarangaPhata/PATSC/2019/00152
To,
M/s M/s Shri Swami Samarth Engineers Limited - M/s L.B. Kunjir
(JV)
773/3, PradyumnApts, Lano No. 9,
Bhandarkar Road, Pune 411004
Tel. No: 020 25679011/99
E-mail: [email protected]
Fax No. 020 25679099
Kind Attention: Mr. Kuldeep Dattatray Patil (Authorized Signatory)
Sub: 4-Laning of Pangare to WarangaPhata section from Km
134.500 to Km 174.645 (Design Chainage) of NH-161 including
Bypasses at Kalamnuri and AkhadaBalapur and additional lengths of
800 m from Waranga Junction to Nanded (NH-161) (existing
Chainage 244.360) and 700 m road from Waranga Junction (NH-
161) to Mahagaon (NH-361) (existing Chainage 253.700) in the State
of Maharashtra on EPC mode - Evaluation of Technical Proposals -
Reg.
Ref: Your RFP Application submitted on 07.12.2020
Sir,
With reference to your proposals submitted on 07.12.2020
w.r.t. subject project it is to inform that while evaluating the bid,
following has been observed:
S. Head Appendix/ Clarification Required
No. Clause
reference
xxx
4. Financial Annex III In case of SSSEL
Capacity Net worth certificate submitted,
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
net worth is mentioned as on
29.07.2020 instead of
31.03.2020. Further, net worth
calculated is not as per the
methodology mentioned in RFP.
Bidder to clarify how the U/s
Loan can be considered for
calculation of net worth duly
certified from the statutory
auditor of the bidder.
As per RFP, bidder is required to
submit the statutory auditor
certificate certifying the Net
worth as on 31.03.2020 for the
FY 2019-20 and in case the
Financial Statements are not
audited then the same us
required as on 31.03.2019 for
the FY 2018-19 after providing
the undertaking under clause
2.2.2.0 (ii) of the RFP.
The Networth of bidder as on
31.03.2019 is Rs. 12.10 cr (i.e.,
the Share Capital of the
Partners), Bidder to Clarify how
it is meeting the required criteria
of net worth as per the RFP
Bidder has submitted Annual
Report for the FY 2018-19
signed by its Statutory Auditor
dated 21.10.2019. However,
UDIN is not mentioned on the
same which was required as per
ICAI Guidelines.
Annual Reports submitted are
blurred and Annual report for
the FY 2014-15 are not found in
the submitted bid.
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
Further it has been observed that
Bidder has considered
consolidate figure for turnover.
Standalone figures are required
for amounts considered for
consolidation (bifurcation) are
required duly certified from the
statutory Auditor of the Bidder.
Bidder to clarify for above points.
5. Financial Annex III As per RFP, in case the annual
Capacity accounts for the latest financial year
are not audited and therefore the
Bidder cannot make it available, the
Bidder shall give an undertaking to this
effect and the statutory Auditor shall
certify the same.
However, undertaking for an audited
Annual Accounts for FY 2019-20 has
not been found in the submitted bid for
both the members.
Please provide the location in the
submitted bid from where the same
can be found duly stamped and signed
by the Statutory Auditor of the bidder
(along with UDIN).
6. Technical Annex IV In case of Shri Swami Samarth,
Capacity (Details of Project Code A claimed is related to
Eligible irrigation work. Bidder to clarify
Projects) through some substantial proof (like
client/SA certificate) that how the
subject projects covered under
category 3 (either it is NH or SH or
MDR or ODR) as per clause 2.2.2.5 of
the RFP.
Project Code C & D - Bidder to clarify
through some substantial proof (like
client/SA certificate) that how the
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
subject projectscovered under category
as per clause 2.2.2.5 of the RFP.
All projects- in statutory auditor
certificates submitted, date of
completion of projects are not
mentioned. Bidder to clarify.
In case of L B Kunjir,
Project code A & B - Bidder to clarify
through some substantial proof (like
client/SA certificate) that how the
subject projects covered under any
category as per clause 2.2.2.5 of the
RFP.
7. Technical 2.2.2.2(ii) As per RFP, at least one similar work
Capacity of 20% of Estimated Project Cost Rs.
149.28 crore shall have been completed
from the Eligible Projects in Category
1 and/or Category 3 specified in Clause
2.2.2.5. (project completed or 90 &
completed as on 31.03.2020.)
Please provide the location in the
submitted bid from where the
completed project or 90% completed
project (in absolute terms and
percentage terms) of similar nature in
last five years (i.e. 01.04.2015 to
31.03.2020) can be found.
2. You may submit your corrections, if any, at the earliest within 7
days (i.e. 11.01.2021), after that no representations will be considered.
Sd/
(Santosh K Bajpai)
DGM (T)
Maharashtra Division"
(The relevant aspects have been underlined by us)
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
5. By this communication, the joint-venture was called upon to "submit
your comments, if any, at the earliest within 7 days....".
6. The joint-venture, of which the petitioner is a partner, sent a detailed
response thereto by its letter dated 09.01.2021 which was followed by
another letter dated 22.01.2021. After consideration of the said
representation, the respondent has issued the impugned communication
dated 03.02.2021, informing the joint-venture that it was unable to establish
its eligibility in terms of the tender conditions.
7. The submissions of Mr. Navare, learned senior counsel for the
petitioner is that the decision arrived at by the respondent, as contained in
the communication dated 03.02.2021, is patently incorrect. In order to
examine his submissions, it would be apposite to refer to the impugned
communication dated 03.02.2021, which reads as under:-
"To,
M/s M/s Shri Swami Samarth Engineers Limited - M/s L.B.
Kunjir (JV)
773/3, PradyumnApts, Lano No. 9,
Bhandarkar Road, Pune 411004
Tel. No: 020 25679011/99
E-mail: [email protected]
Fax No. 020 25679099
Kind Attention: Mr. Kuldeep Dattatray Patil (Authorized
Signatory)
Sub: 4-Laning of Pangare to WarangaPhata section from Km
134.500 to Km 174.645 (Design Chainage) of NH-161
including Bypasses at Kalamnuri and AkhadaBalapur and
additional lengths of 800 m from Waranga Junction to Nanded
(NH-161) (existing Chainage 244.360) and 700 m road from
Waranga Junction (NH-161) to Mahagaon (NH-361) (existing
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
Chainage 253.700) in the State of Maharashtra on EPC mode -
Evaluation of Technical Proposals - Reg.
Ref:
(i) Your RFP Application submitted on 07.12.2020.
(ii) NHAI HQ letter no.
NHAI/Tech/MH/PangareWarangaPhata/PATSC/2019/00152
dated 05.01.2021.
(iii) Your letter no. SSSEL/Tender/100/2020-2021 dated
09.01.2021.
Sir,
Please refer to your proposal submitted on 07.12.2020
and observations communicated to you vide ref. - ii, wherein 7
days' time was provided to you for representation, if any.
Further, you have submitted clarifications w.r.t. observations
communicated to you vide ref. - ii, vide letter dated 09.01.2021.
2. In this regard, it is to inform that your proposal has been
considered as Non - responsive pursuant to the provisions of
RFP on following basis :
2.1 AS per clause 2.2.2.3 (i), The Bidder shall have a
minimum Net Worth (the "Financial Capacity") of Rs. 37.32
crore at the close of the preceding financial year.
2.2 Bidder has been claimed the net worth for the FY 2019-
20 based on the unaudited books of accounts for the FY 2019-
20. Clarification was sought from the Bidder for the same.
2.3 Bidder in its reply has submitted its Audited Annual
statements for the FY 2019-20 which is dated 17.12.2020 i.e.
after the Bid Due Date.
2.4 As the Annual Accounts of the Bidder for the FY 2019-20
was not audited as on Bid Due Date, therefore net worth of the
Bidder for the FY 2019-20 may not be considered.
2.5 Also net worth certificate submitted by the Bidder is not
submitted by the Statutory Auditor of the Bidder.
2.6 Based on above facts net worth for the FY 2018-19 is
calculated from the Audited Financial statements submitted in
the Bid for the FY 2018-19 which works out to be Rs. 12.10 cr
i.e. less than the required criteria.
2.7 As per clause 2.2.2.2 (ii) of RFP, "Provided that at least
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
one similar work of 20% of Estimated Project Cost Rs. 149.28
crore shall have been completed from the Eligible Projects in
Category 1and / or Category 3 specified in Clause 2.2.2.5. For
this purpose, a project shall be considered to be completed
value of work is equal to or more than 20% of the estimated
project cost. " No such project found in the submitted bid.
2.8 Bidder has claimed two projects. Details of which are as
follows:
Project 1 - Constructions of Barrages on Painganga River at
Rajgaon, Ukali, Songhavan, Tanka, Dhilli, Jaipur. Dist.
Washim for Irrigation Department Govt. of Maharashtra.
The project includes Construction of Barrages for Irrigation
Department which covers under category 4 therefore said
project cannot be considered pursuant to above mentioned
criteria.
Project 2 - Rehabilitation and Upgradation of Khamgaon
todeulgaonSakarsha Section of NH-548C from design
Ch.0+000 to 35+786 in the state of Maharashtra to 2 lanes
with paved shoulder on EPC mode.
Based on the documents submitted, completion status of the
project as on 31.03.2020 cannot be ascertained. Hence,
eligibility of the Bidder pursuant to clause 2.2.2.2 (ii) for
completed project cannot be established.
3. In view of the above, your proposal has not been
considered for next stage of Bidding Process.
Sd/
(Santosh K Bajpai)
DGM (T)
Maharashtra
Division"
8. Learned senior counsel submits that along with the clarification
furnished on 09.01.2021, the joint-venture had submitted duly audited
accounts for the financial year 2019-20. He, thus, contends that the
respondent was not justified in rejecting the said audited annual statements
of the financial year 2019-20, only on account of the fact that the said
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
statements were audited on 17.12.2020 i.e, after the bid due date of
07.12.2020.
9. Moreover, the respondents in the impugned communication have also
stated that the joint-venture had not submitted the net-worth certificate from
its statutory auditor along with its bid. On a query put by us, Mr. Navare
states that the said document was subsequently submitted, i.e., after the
issuance of the impugned communication.
10. By drawing our attention to Clause 2.2.2.8(ii) of the tender conditions,
which deals with submission of documents in support of the bidder's
financial capacity, he contends that once the audited financial statements
itself were provided, there was no requirement of any undertaking being
furnished. The said clause reads as under:
"2.2.2.8(ii) In case the annual accounts for the latest
financial year are not audited and therefore the Bidder
cannot make it available, the Bidder shall give an
undertaking to this effect and the statutory auditor shall
certify the same. In such a case, the Bidder shall provide the
Audited Annual Reports for 5 (five) years preceding the year
for which the Audited Annual Report is not being provided."
11. The annual accounts of the joint-venture for the latest financial year
i.e. 2019-20 were not audited at the time of submission of the bid. The joint-
venture should, therefore, have submitted the undertaking in terms of the
aforesaid clause. The joint-venture, admittedly, did not submit the
undertaking as required by the aforesaid clause along with its bid, and
submitted the audited annual account statement for the financial year 2019-
20, only after the bid due date. As noticed hereinabove, even the net-worth
certificate initially submitted by the bidder was not prepared by its statutory
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
auditor, and the said certificate as prepared by its statutory auditor was
provided only subsequently.
12. In our view, the aforesaid itself was sufficient to reject the bid of the
joint-venture. There is no gainsaying that the terms and conditions of the
NIT have to be strictly adhered to and followed by all bidders in order to
keep the entire process above board and free from allegations of bias or
irregularities. In the process of tendering, all bidders have to strictly follow
the rules and failure of even the most competent bidder to meet the
conditions of the NIT would non-suit him.
13. The Petitioner's joint-venture, admittedly, neither submitted the
undertaking in terms of Clause 2.2.2.8(ii), nor did it submit the requisite net-
worth certificate from its statutory Auditor along with its bid. The purpose
of seeking clarifications was not to grant another opportunity to the bidders
to fulfill a deficiency in the bid. The petitioner was only asked to provide
clarification and not to complete an incomplete bid. Therefore, for the
petitioner to claim that the respondent should have looked into the audited
annual accounts for the year 2019-20 which the joint-venture provided with
its clarification, has no merit. The joint-venture's bid was, therefore, rightly
rejected on this ground.
14. We find that the impugned communication, in fact, contains another
ground for rejection of the joint-venture's bid, namely, that it was unable to
establish its past experience as required in terms of Clause 2.2.2.2(ii). From
the impugned communication, it appears that said clause prescribed that the
bidder should have experience of completing "at least one similar work of
25% of Estimated Project Cost Rs. 189.57 crore (Rs. one hundred eighty
nine crore and fifty seven lakhs only) shall have been completed from the
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
Eligible Projects in Category 1 and/or Category 3 specified in Clause
2.2.2.5. For this purpose, a project shall be considered to be completed, if
more than 90% of the value of work has been completed and such completed
value of work is equal to or more than 25% of the estimated project cost".
The said communication states that the joint venture had not submitted any
documents to establish its past experience in terms of the said clause. The
documents submitted by it in relation to construction of barrages for
irrigation department were not accepted by the respondent on the ground
that these projects were covered by category 4, and did not constitute
category 1 and or/category 3 projects as specified under Clause 2.2.2.5.
15. In this regard, the submission of Mr. Navare is that the respondent
itself had accepted the similar past experience certificate of the joint venture
of construction of barrages for irrigation department, in respect of its bids in
relation to other similar contracts and, therefore, there was no reason to hold
that the joint venture did not have the requisite past experience.
16. In support of his contention, Mr. Navare has drawn our attention to
the legal notice issued by the joint-venture, post the issuance of the
impugned communication, wherein it has set out in detail the work awarded
to the joint venture on the basis of the same past experience certificate. The
relevant extracts of the notice read as under:
2.8 Bidder has claimed two projects. On this same certificate of our clients were
Details of which are as follows: qualified by MORTH & NHAI for below
mentioned Projects.
Project 1 - Construction of
Barages on Painganga River at Sr.No. Name of Cost Date of
Rajgaon, Ukali, Songhavan, Work (Cr) Qualification
Tanka, Dhilli, Jaipur. Dist. 1. Malegaon 227.l57 17 March
Washim for Irrigation Department to Rishod 2018
Govt. of Maharashtra.
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
2. Astamode 191.53 18 Sept 2019
The project includes Construction to Tivatyal
of Barrages for irrigation 3. Nagaur to 291.26 24 March
Department which covers under Bikaner 2020
category 4 therefore said project 4. Akola to 222.14 09 July 2020
cannot be considered pursuant to Akot
above mentioned criteria.
Project 2 - Rehabilitation & Sr.No. Name of Cost Date of
Upgradation of Khamgaon to Work (Cr) Qualification
Deulgaon Sakarsha Section of 1. Malegaon 300.99 24 Dec 2020
NH-548C from design Ch.0+000 to Rishod
to 35+786 in the state of 2. Astamode 191.53 18 Sept 2019
Maharashtra to 2 lanes with paved to Tivatyal
shoulder on EPC mode. 3. Nagaur to 291.26 24 March
Bikaner 2020
Based on the documents 4. Akola to 222.14 09 July 2020
submitted, completion status of Akot
the project as on 31.03.2020 5. `Khed 119.80 24 Sep 2020
cannot be ascertained. Hence, Sinner
eligibility of the bidder pursuant section
to clause 2.2.2.2(ii) for completed 6. Bidar to 300.99 24 Dec 2020
project cannot be established. Humnabad
7. Indore 258.14 11 Jan. 2021
Gujarat
MP
Border
17. Pertinently, it is not the petitioner's case that the respondent erred in
coming to the conclusion that the past experience of the petitioner's joint
venture in respect of construction of barrages for irrigation department is
covered by the work in category 4 as specified in Clause 2.2.2.5; his
submission, however, is that the same experience certificates have been
accepted in the past for award of work in respect of various other projects.
We are unable to accept this contention as, in the present case, we are
examining and are concerned only with the joint-venture's disqualification
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
from this tender. The circumstances under which the said experience
certificate was accepted for award of contracts to the petitioner's joint
venture in the past are not a subject matter of consideration in the present
petition. Admittedly, the experience certificate submitted by the joint-
venture does not relate to work in category 1 and or/category 3 as defined.
That being the position, the decision of the respondent to not consider the
joint-venture's bid is justified on that ground as well.
18. We, therefore, do not find any merit in the present petition which is
dismissed alongwith the pending applications.
VIPIN SANGHI, J
REKHA PALLI, J
FEBRUARY 12, 2021
kk
Signature Not Verified
Signed By:GARIMA MADAN
Location:
Signing Date:16.02.2021
