WA/8/2021
2021 Latest Caselaw 393 Gua

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GAHC010001472021




                       IN THE GAUHATI HIGH COURT
 (HIGH COURT OF ASSAM, NAGALAND, MIZORAM & ARUNACHAL PRADESH)

                                 WA 8/2021

     1. The Assam Fisheries Development Corporation Ltd.,
        A Government of Assam Undertaking,
        Represented by its Managing Director,
        Having its Office at Chachal, VIP Road,
        Guwahati-781036, Kamrup (M), Assam.

     2. The Managing Director,
        Assam Fisheries Development Corporation Ltd.,
        A Government of Assam Undertaking,
        Represented by its Managing Director,
        Having its Office at Chachal, VIP Road,
        Guwahati-781036, Kamrup (M), Assam.
                                                         -   Appellants.
                          - versus-


     1. Nihar Ranjan Hazarika,
        S/o Dilip Hazarika,
        R/o Village-Teliadonga Pukhuri Par,
        P.O. BharulaTiniali, P.S. Gaurisagar,
        District-Sivasagar, Assam,
        PIN-785664.

     2. Dilip Hazarika,
        S/o Late Juram Hazarika,
        R/o Village-Teliadonga Pukhuri Par,
        P.O. BharulaTiniali, P.S. Gaurisagar,
        District-Sivasagar, Assam,
        PIN-785664.
                                                         - Respondents.

3. The State of Assam, Represented by the Commissioner and Secretary to the Government of Assam, Fishery Department, having its Office at Dispur, Guwahati-781006, District-Kamrup(M), Assam.

4. The Secretary to the Government of Assam, Fishery Department, having its Office at Dispur, Guwahati-781006, District-Kamrup(M), Assam.

5. The Deputy Commissioner, Sivasagar, having its Office at Sivasagar Town, District-Sivasagar, Assam, PIN-785640.

6. Babul Das, S/o Late Kon Das, R/o Namdongia Bangali, P.O. Gaurisagar, PIN-785664, District-Sivasagar, Assam.

- Proforma Respondents.

WA 27/2021 Babul Das, S/o Late Kon Das, R/o Namdongia Bangali, P.O. & P.S. Gaurisagar, District-Sivasagar, Assam, PIN-785664.

- Appellant.

- versus-

1. The State of Assam, Represented by the Commissioner & Secretary to the Government of Assam, Fishery Department, Dispur, Guwahati-781006.

2. The Secretary to the Government of Assam, Fishery Department, Dispur, Guwahati-781006.

3. The Assam Fisheries Development Corporation Ltd., A Government of Assam Undertaking, Represented herein by its Managing Director, Having its Office at Chachal, VIP Road, Guwahati-781036, District-Kamrup (M), Assam.

4. Managing Director, The Assam Fisheries Development Corporation Ltd., A Government of Assam Undertaking, Having its Office at Chachal, VIP Road, Guwahati-781036, District-Kamrup (M), Assam.

5. Dilip Hazarika, S/o Late Juram Hazarika, R/o Village-Teliadonga Pukhuri Par, P.O. BharulaTiniali, P.S. Gaurisagar, District-Sivasagar, Assam, PIN-785664.

6. Nihar Ranjan Hazarika, S/o Dilip Hazarika, R/o Village-Teliadonga Pukhuri Par, P.O. Bharula Tiniali, P.S. Gaurisagar, District-Sivasagar, Assam, PIN-785664.

- Respondents.

                              BEFORE
         HON'BLE THE CHIEF JUSTICE MR. SUDHANSHU DHULIA
         HON'BLE MR. JUSTICE ACHINTYA MALLA BUJOR BARUA
Advocates present: (in WA 8/2021)
For appellants                    :      Mr. P. Sharmah.
For respondent no. 1              :      Mr. R. Borpatra Gohain.
For respondent no. 2              :      Mr. H. Buragohain.
For proforma respondent           :      Mr. T. C. Chutia,
nos. 3, 4 and 5                          Addl. Sr. Government Advocate.
For proforma respondent no. 6     :      Mr. S. Borthakur.

Advocates present: (in WA 27/2021)
For appellant                     :      Mr. S. Borthakur.
For respondent nos. 1 and 2       :      Mr. T. C. Chutia,
                                         Addl. Sr. Government Advocate.
For respondent nos. 3 and 4       :      Mr. P. Sharmah.
For respondent no. 5              :      Mr. H. Buragohain.
For respondent no. 6              :      Mr. R. Borpatragohain.

                       JUDGMENT AND ORDER (ORAL)

05.02.2021
(Sudhanshu Dhulia, CJ)

Heard Mr. P. Sarmah, learned counsel for the appellants in WA 8/2021 (respondent nos. 3 and 4 in WA 27/2021) and Mr. S. Borthakur, learned counsel for the appellant in WA 27/2021 (respondent no. 6 in WA 8/2021). We have also heard Mr. T. C. Chutia, leaned Additional Senior Government Advocate,

representing the State as well as Mr. R. Borpatragohain, learned counsel for respondent no. 1 in WA 8/2021 (respondent no. 6 in WA 27/2021) and Mr. H. Buragohain, learned counsel for respondent no. 2 in WA 8/2021 (respondent no. 1 in WA 27/2021).

2. In both these writ appeals, the appellants are aggrieved by the judgment and order dated 18.12.2020 passed by the learned Single Judge in WP(C) 3420/2020 and WP(C) 2762/2020. WA 8/2021 is filed by the Assam Fisheries Development Corporation Ltd. (respondent no. 3 in the writ petitions), and WA 27/2021 is filed by Babul Das, i.e. respondent no. 6 in WP(C) 3420/2020, in whose favour the settlement was made by the Assam Fisheries Development Corporation Ltd. (hereinafter referred to as "the Corporation"). By the order dated 18.12.2020, the learned Single Judge had set aside the order of settlement made in favour of Babul Das (appellant in WA 27/2021) and directed the authorities to make the settlement in favour of Dilip Hazarika (respondent no. 2)/writ petitioner in which he was the highest bidder. However, for sake of convenience and clarity, the facts which we would be referring here will pertain to WA 8/2021, with a reference to the other "writ appeal", as and when it is required.

3. A Notice Inviting Tender (NIT) was given by the Corporation on 18.02.2020. Bids were invited by the Corporation, only from the fishing communities as well as from "Samabai Samities" (i.e. co-operative societies) of fishermen, for settlement of lakes and ponds for the purposes of fisheries which were within the jurisdiction of the Corporation in various districts in the State of Assam. The bids were being invited for as many as thirty-six "Beels"1. We are presently concerned with Teliadonga Krishnachia Kurjan Beel" Min Mahal"2 in the district of Sivasagar, of which the land and water area are 13.69 and 13.19 Hectors, respectively, and which is at item no. 35 of the said NIT dated 18.02.2020.

4. One of the important conditions in the NIT was that "No tender will be accepted whose value is less than the minimum value mentioned against the

Lake or more precisely a water body.

Fishery

concerned Min Mahal". The minimum value mentioned in the NIT for Teliadonga Krishnachia Kurjan Beel Min Mahal was Rs. 5,26,800.00 per year. Against the aforesaid Min Mahal there were four bidders, which are as follows:

(a) Dilip Hazarika

(b) Nihar Ranjan Hazarika

(c) Sanjib Das

(d) Babul Das

5. It was a two-bid process and all the bidders were first evaluated in the technical bid and only if they qualified in the technical bid their financial bids were to be opened. The technical bids were opened on 07.03.2020 and the financial bids were opened on 22.05.2020. It is an admitted position that all the four bidders mentioned above had qualified in the technical bid. The financial bids of the technically qualified bidders were as follows:

(a) Dilip Hazarika - Rs. 73,92,007.00 for 7 years, i.e. for one year Rs. 10,56,001.00

(b) Nihar Ranjan Hazarika - Rs. 61,95,007.00 for 7 years, i.e. for one year Rs. 8,85,001.00

(c) Sanjib Das - Rs. 54,66,000.00 for 7 years, i.e. for one year Rs. 7,80,857.00

(d) Babul Das - Rs. 45,66,007.00 for 7 years, i.e. for one year Rs. 6,52,286.00

6. Even though the writ petitioner in WP(C) 2762/2020 (present respondent no. 2) was the highest bidder, the Corporation made settlement in favour of one Babul Das, who made the lowest bid out of the four bidders. In another words, the admitted case here is that instead of making the settlement in favour of the highest bidder, the settlement was made in favour of the lowest bidder. Aggrieved by the settlement, the highest bidder, i.e. Dilip Hazarika, and the second-highest bidder, i.e. Nihar Ranjan Hazarika, filed writ petitions [WP(C) 2762/2020 and WP(C) 3420/2020, respectively] before the learned Single Judge of this court. The writ petition 2762/2020 was allowed. Before the learned Single Judge as well as before this court the case of the writ appellant (i.e. the Corporation) is that they were justified in rejecting the offer of the highest bidder as the rate quoted in the bid were extremely exorbitant and there was every likelihood that if the fishery

was settled in favour of the highest bidder, he would have defaulted as it would be a venture which was unprofitable and hence bound to fail, which would have caused loss to the Corporation as such a person would leave midway. Moreover, they had also stated that the Corporation is well within its right to evaluate the bids in between the viable range as per the stipulation given in Clause 5(1) of the Memorandum & Articles of Association of the Corporation, which reads as under:

"5.Beel Management and implementation of development activities:

5.1 The Company shall manage the beels through tender process as per norms. The Company shall fix the minimum tender value as basic tender value and maximum limit of tender value in accordance with the situation of the beel environment and depending upon the minimum and maximum production capacity of the beel.

                                                           (emphasis provided)
             ***                  ***                  ***"

7. Learned counsel for the writ appellant has also invited out attention to Clause 4.7 of the NIT, which is as under:

"4.7. If the tenderer quote exorbitant rate than the minimum rate than the Corporation reserves the right whether to accept or not of that tenderer and final decision in this aspect will be with the Corporation considering all aspects. Earlier it was observed that by quoting exorbitant rate Mohaldar/Settlement holder could not run beels. For that reason the settlement holder also gets hurt financially. Moreover there should be scientific reasoning for production of fish. Quotation of exorbitant/unimaginable rate may not be accepted by the Corporation."

8. The writ petitioners [respondent no. 2 i.e. Dilip Hazarika before this court is the writ petitioner in WP(C) 2762/2020] had submitted that in terms of Regulation 5.1 of the Regulations the Corporation should have given both the rates, i.e. the minimum tender value and the maximum limit of tender value. Had there two values been disclosed then a bidder had to give his bid only between the two

values. The Corporation, admittedly has not done that. The NIT dated 18.02.2020 only shows the "minimum tender value" which in the present case has given as Rs.5,26,800/- per year. Therefore, the case of the writ petitioners before the Court was that when the highest tender value was not disclosed then how can the Corporation now say that the bid is exorbitant?

9. It must be recorded here that the stand taken by the Corporation was that it is not an ordinary commercial or financial Corporation, with only business interests in mind, but it also looks after the welfare of fishermen and, therefore, the conduct of the Corporation has to be seen not merely in the perspective of business transaction, but it is also to be seen whether the conduct of the Corporation is justified considering the duties of the Corporation towards the development and welfare of fishing communities, and development of fisheries in general. The learned Single Judge has dealt with this aspect and for this reason, the learned Single Judge also summoned the relevant records. The findings recorded by the learned Single Judge in paragraphs 8, 9 and 10 of the judgement are important for our consideration, which are reproduced below:

8) It is seen that the impugned order speaks about the past yield of

the fishery, but the record as produced does not reveal any document

showing yield of the concerned fishery in any previous years. The

records also do not contain any document regarding the value on which

the same fishery was settled in any of the previous years. Therefore,

from the records produced, there can be no other conclusion save and

except that while rejecting the bids submitted by the three highest

bidders and while settling the fishery with the respondent no.6, the

respondent nos. 3 and 4 have relied on some material which is neither

available in the record produced nor the gist of such document is found

to have been recorded in any of the note sheets contained in two office

files produced. In the note sheet, the authorities of respondent nos. 3

and 4 have stated that the respondent no.6 had quoted 2302.75 kg. per

hectare and that other bidders had quoted 3736.0 kg. per hectare,

3431.16 kg. per hectare, and 2762.70 kg. per hectare. However, such

figures are not found written in the bid documents submitted by any of

the bidders, nor such specific particulars have been entered in the

comparative statement prepared by the authorities. Moreover, one

intriguing fact is that as per the minutes of discussion on selection of

tenderers for settlement of beels for 2020-21, as contained in pages 2 to

7 of the note-sheet of file no. AFDC.486/2020, settlement was considered

for as many as 19 fisheries, but the weight and area wise (i.e. kg. and

hectare) breakup was calculated only in respect of the "Teliadunga

Krishnachigakur" fishery. However, there is no explanation in the note

sheet why such an departure was made in the present case in hand.

9) One of the argument made by the learned counsel for the

respondents was to the effect that the respondent nos. 1 to 4 had

calculated the viable range and found that the bid submitted by the

respondent no.6 was reasonable and that the bids submitted by the other

bidders was exorbitant and as respondent no.3 is not a profit making

company and that one of its objects is to ensure that the actual

fishermen actually earn their livelihood, there was no illegality in settling

the tender for the fishery in question with respondent no.6, which was in

consonance with Article 5.1 of the Articles of Association and such

settlement would secure livelihood of fishermen and would secure the

revenue of the respondent nos. 4 and 5. The said argument appears to be

appealing, but yet it is not found acceptable because the object of the

respondent no.1 at sl. no. 1 is "to undertake development of fisheries in

the State and ensure increased production". However, in the meeting

minutes dated 22.05.2020, there is no discussion to the effect that in the

past the respondent nos. 4 and 5 did not ensure increased production of

fish and therefore, there is no possibility for the three highest bidders to

get an increased production. It would be relevant to mention herein that

although the tender in question was under two bid system, i.e., technical

bid and financial bid, the respondent nos. 4 and 5 have only produced the

file relating to financial bid, which contains no supporting documents.

However, for the reasons best known to the respondent nos. 4 and 5, the

file relating to technical bids of the fishery in question has been

withheld.

"As per the minutes dated 22.05.2020, the officers of the respondent nos. 4 and 5 have recorded as follows:- "Further, the technical bid projected by all the four bidders shows that the technical bid submitted by Shri Babul Das is more reasonable among all which is in support the surroundings of the Beel as well as productive area. He quoted 2302.75 Kg/Ha which is proper and acceptable as per the past record of the Beels but the other bidders have quote 3736.0 Kg/Ha, 3431.16 Kg/Ha and 2762.70 Kg/Ha cannot be acceptable and seems to be imaginary having no knowledge over Beel. It will not be appropriate to allow persons who has no knowledge over because the Corporation has to secure the livelihood of the Fisherman as well as to secure earning of revenue. Because not only being the previous Lessee but having sufficient knowledge of fishing and management of the Beel Corporation may go for management of Teliadanga Beel in faour of Shri Babul Biswas. The rate quoted by him will be benefited for both Corporation and Shri Babul Biswas."

10) As indicated above, as the file relating to technical bid has been

withheld, thus, in the absence of any supporting documents, there is no

material before this Court to accept the correctness of the logic based

on which the herein before quoted observations has been made.

10. The learned Single Judge, then, discussed the matter in detail and found that there is nothing on record which shows that the technical committee or financial committee, which had evaluated the bids of the four bidders, had applied its mind to this "viability aspect". In other words the case of viability as made by the Corporation before this Court is not supported by any documents of the Corporation. Moreover, the fact remains that the bidding was admittedly a two-bid process and the private respondent no. 2 as well as the other bidders had qualified in the technical bid. Since they admittedly qualified in the technical bid, now, at this late stage, when financial bids had already been opened, it cannot be said that the highest bidder do not have any experience in fishing or that the calculation of the highest bidder as to the yield of fish per Hector, as projected in

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the financial bid is exorbitant and, hence, it is likely that the highest bidder would default and it is the Corporation which ultimately would suffer loss. The only anxiety shown by the Corporation for not giving the settlement in favour of the highest bidder is that he may, ultimately, leave the project and create trouble for the Corporation. This contingency, however, can very well be met by implementation of Clause 10.1 of the tender document, where there is a provision for getting higher security on bank guarantee in favour of the Corporation.

In other words, the Corporation can take additional security in terms of the aforesaid provision from the highest bidder in order to ensure that such a contingency may not happen and if it happens, the Corporation is at least financially covered. But to take the extreme measure of rejecting the highest bidder although he has been declared technically qualified is wholly arbitrary, and in against the procurement laws.

11. Learned counsel for the private respondent no. 2 has relied upon the judgment of the learned Single Judge in the case of Jewti N.G.O. vs. State of Assam &Ors., reported in 2017 (4) GLT 762, which addresses a similar contingency. The learned Single Judge had observed in paragraph 18 of the judgment as under:

"18. While it may be true that there may be bidders offering exorbitant price so as to grab the settlement only to subsequently end up as defaulter and to that extent it cannot be denied that the tendering authorities must have the liberty to eliminate such superficial bidders. But such process of elimination must be fair and transparent whereby, the bidders are notified before the submission of the bids as to the criteria that would be followed for evaluation of the price bids. If the authorities are of the view that the predatory price offers should be discouraged and such bids should be eliminated at the threshold, there is nothing preventing them from incorporating suitable clauses in the NIT providing for the same. The authorities may even impose stringent default conditions in the NIT so as to act as a deterrent for such bidders quoting un-realistic prices. That apart, the option of insisting on additional security from the successful

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bidder if the price is found to be abnormally high, is also available to the authorities by making suitable provision in the NIT."

12. Although the learned counsel for the Corporation as well as the learned counsel for the appellant in WA 27/2021 would argue that the case which has been relied on by the learned counsel for the respondent no. 2, in which the above observation was made by the learned Single Judge, is not applicable to the facts of the present case inasmuch as the case which is being referred to was regarding Government fisheries covered by the Assam Fishery Rule, 1953, whereas under the rules of the Fisheries Development Corporation much more power are given to the Corporation to reject the bid of a bidder in a given contingency. We, however, disagree with the contention inasmuch as the observations of the learned Single Judge are very general in nature and can be applied to the present contingency as well.

13. Learned counsel for the Corporation has relied upon the judgement of the Full Bench of this Court in M/s 129 Haria Dablong Min Mahal Samabai Samity Ltd. And etc. vs. Assam Fisheries Development Corporation Ltd. and others, reported in AIR 2001 Gau 139.

14. Learned counsel for the Corporation would argue that it is because of the direction given by the Full Bench that the regulations, more particularly, Clause 5(1) of the Articles of Association and Clause 4.7 of the tender conditions, were framed, reference of which has already been made in the preceding paragraph.

15. In the decision of the Full Bench being cited have indeed the Full Bench had given guidelines in Paragraph 31 of its order. They all relate to the duties and responsibilities of the Corporation, i.e. the writ appellant before us. The order reads as follows:

"31. In view of our foregoing discussion and decisions, we answer the question raised as follows:

1) Assam Fisheries Development Corporation has the sole authority and jurisdiction to lease out/settle the fisheries which have been transferred or vested with them under Rule 8(c)(ii) if the Assam Fishery Rules;

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2) The AFDC shall have no power to make any direct settlement as per the proviso to Rule 12 of the Assam Fishery Rules. The Director of the AFDC shall have the authority to make settlement and for that purpose definite guidelines may be laid down so that there is transparency in the matter of settlement. The need for transparency need not be reemphasized in view of the catena of decisions of the Apex Court on the point.

3) While laying down the guidelines or resolutions the spirit of the Fishery Rules may be given due weightage/consideration. Fishery Rules were enacted to provide stimulus the fish production and help the population which is engaged with the occupation of fishing. Under the Fishery Rules preference is given to the co-operative societies formed by 100% fisherman belonging to Scheduled Caste community and Mainao Community of Cachar. Hence the AFDC is directed to lay down the definite guidelines in the matter so that there is no ambiguity.

4) As the AFDC has been found to have powers to make settlement in respect of the fisheries vested with them they have implied power to pass orders regarding extension of the settlement. We may however like to add here that extension of fisheries creates unnecessary problems and as such definite criteria or parameter may be laid down or some alternative may be found out to give relief to the lessee in proper and suitable cases.

5) *** *** ***."

We, however fail to understand as to how the aforesaid findings help the writ appellant. What has been done at the hands of the writ appellant cannot be justified, the least by taking shelter of the above findings. What has been indicated by the court states the duties of the corporation which are, inter alia, the development of fisheries and fishing communities. But it does not mean that these powers should be misused as it is apparently the case at hand.

16. The only contention of the learned counsel for the appellants in WA 8/2021 before this court for not accepting the highest bid and for giving the settlement to the lowest bidder is that it is not possible to yield from the fishery, as projected by

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the highest bidder and it is not viable at the amount of Rs. 73,92,007.00 for seven years. In order to arrive at such a conclusion, the Corporation has relied upon the existing figures of the last seven years. The admitted position is that the settlement was given in favour of Babul Das, who is respondent no. 6 herein (writ appellant in WA 21/2021) all these years. Naturally, the figures which have been evaluated are the figures on which the contract was given in favour of the respondent no. 6 earlier. He continues to make the bid for almost the same amount now as well. The appellant Corporation is a Fisheries Development Corporation, if there is a bidder which has seen the potential of the present fishery to yield higher amount of fish then all this is in the interest of the Corporation. Moreover, neither the rates nor the production of fish per Hector can remain stagnant. There must be a change and a change for the better. Another settled position in this matter is that though the Corporation was not bound to accept and execute the bid of even the highest bidder, but since, admittedly, he was the highest bidder, if his bid was not being accepted, an explanation should have been called for and reasons should have been given as to why he had quoted such a high rate when, more importantly, Clause 10.1 of the tender condition itself protects the Corporation in such a contingency which provides for taking three times of the minimum value as security in the form of Bank guarantee/FDR from the bidder with whom the settlement is made. However, this has not been done. This is not a case where the Corporation only refused the bid of the highest bidder, but they have gone a step further. They not only refused the bid of the highest bidder, they refused the next highest bidder and, then, they also refused the bid of the third highest bidder and gave the settlement to the lowest bidder by giving an extremely strange logic. The writ petition, therefore, was rightly allowed by the learned Single Judge. We totally agree with the findings of the learned Single Judge and there is absolutely no scope for interference with the order passed by the learned Single Judge.

17. In view of the observations above, we dismiss the writ appeals.

18. We make it very clear that in the settlement to be made in favour of Dilip Hazarika (private respondent no. 2) i.e. the highest bidder, the Corporation would

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be at liberty to take additional security, including Bank Guarantee from him as permissible under the law.

                             JUDGE                 CHIEF JUSTICE




Comparing Assistant