Page No.# 1/8 vs The Oil And Natural Gas ...
2021 Latest Caselaw 2811 Gua

                                                                Page No.# 1/8

GAHC010072112019




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

                            Case No. : WP(C)/2223/2019

         GAUTAM BARUAH AND 4 ORS.
         S/O- LT GANESH BARUAH, R/O- VILL- GARMUR DULIA GAON, P.O.
         JORHAT ENGINEERING COLLEGE, JEC ROAD, GARMUR, PIN- 785001, AND
         THE PROPRIETOR OF M/S MINAKSHI DRUGS, JORHAT

         2: BHAWAR LAL LAKHOTIA
          S/O- LT SOHAN LAL LAKHOTIA
          R/O- BORGOLA MARKET
          3RD FLOOR
          MARWARIPATTY
          P.O. JORHAT
          PIN- 785001
         AND THE PROPRIETOR OF M/S LAKHOTIA MEDICAL HALL
          JORHAT

         3: RANJIT BORDOLOI
          S/O- LT ANIL BORDOLOI
          R/O- VILL- CHARI GAON
          P.O. BAHORU
          P.S. BHUGDOI
          PIN- 785001
         AND PROPRIETOR OF M/S DEEPALI PHARMACY
          JORHAT

         4: SATADAL GHOSH
          S/O- NARENDRA CH. GHOSH
          R/O- J.B.ROAD
          NEAR STATE BANK OF INDIA ATM
          JORHAT
          PIN- 785001
         AND THE PROPRIETOR OF M/S NORTH EAST MEDICAL HALL
          JORHAT

         5: KHIRUD SAIKIA
                                                                     Page No.# 2/8

             S/O- LT SARAT SAIKIA
             R/O- BAGHDHORA CHARIALI
             CINNAMARA
             NEAR ONGC COLONY
             PIN- 785008
             AND THE PROPRIETOR OF M/S JOY SHANKAR MEDICAL
             CINNAMARA
             JORHA

            VERSUS

            THE OIL AND NATURAL GAS CORPORATION LTD AND 2 ORS.
            REP. BY ITS CHAIRMAN/MANAGING DIRECTOR, A COMPANY REGD.
            UNDER THE COMPANIES ACT, 1956, AND HAVING ITS REGD. OFFICES AT
            PANDIT DEEN DAYAL UPADHYAYA URJA BHAVAN, 5 NELSON MANDELA
            MARG, VASANT KUNJ, NEW DELHI- 110070

            2:THE DY. GENERAL MANAGER (MM)
             I/C MATERIALS MANAGER
             ONGC
             MATERIALS MANAGEMENT DEPTT.
             2ND FLOOR
             DHANSIRI BHAVAN
             ONGC CINNAMARA COMPLEX
             JORHAT
             PIN- 785704

            3:THE EXECUTIVE DIRECTOR-BASIN MANAGER
            ASSAM AND ASSAM-ARAKAN BASIN
             LUIT BHAVAN
             CINNAMARA
             JORHAT
             PIN- 78570

Advocate for the Petitioner   : MR. M K CHOUDHURY

Advocate for the Respondent : MR G N SAHEWALLA
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                                    BEFORE
                     HONOURABLE MR. JUSTICE SOUMITRA SAIKIA

                                       ORDER

11.11.2021

Heard Mr. M.K. Choudhury, learned Senior Counsel assisted by Mr. A. Barkataki, learned counsel for the petitioners and Mr. G.N. Sahewalla, learned Senior Counsel assisted by Mr. A.N. Singh, learned counsel for the respondent/ONGC.

2. The petitioners are businessmen and proprietors running their respective firms which deals in supply, distribution and sale of medicines in the district of Jorhat, Assam. The learned Senior counsel for the petitioners submits that they developed their goodwill in their businesses over the years as chemists/pharmacists/stockist etc in the said region. The petitioners also claimed that they have been consistently supplying medicines and drugs as prescribed by ONGC medical personnel to their staff, employees and their families. The learned Senior counsel for the petitioners submits that they have been empanelled as pharmacists/stockist to supply medicines and drugs to the staff, employees and their families of the ONGC. The said practice of empanelling, the petitioners and other similar situated persons was long standing practice followed by the ONGC.

3. The learned Senior counsel for the petitioners submits that a bid for entities interested to be empanelled as chemists/pharmacists at Jorhat City, Borholla, Cinnamara and Sarupathar for three (3) years, the NIT No. L26NC18002 dated 06.11.2018 was floated by the ONGC authorities. The petitioners being eligible and participated in the Bid process. During the process of the NIT, the tenure of the petitioners as suppliers of drugs and medicines was Page No.# 4/8

extended by the ONGC. Suddenly on 08.03.2019, the petitioners were informed by respective letters from the ONGC that the Bank Guarantee which was submitted as Earnest Money Deposits (EMD) in respect of the Tender No. L26NC18002 dated 06.11.2018 had been returned in its original and without any intimation as to what is the progress or status of the tender process initiated. The petitioners upon making enquiries came to be informed that the tender process has been cancelled and consequently, the EMD has been returned. Subsequently, a fresh tender being Tender No. L26NC19001 dated 22.03.2019 was published in the website inviting online bids/tenders for empanelment of retail chain pharmacies/chemists shops for supply of medicines and consumables etc. The petitioners are aggrieved by one eligibility criteria in the fresh tender namely, Clause B.1.2 which provided that the bidder should have at least twenty owned operational pharmacy outlets and also have atleast thirty pharmacists on their rolls. The petitioners are aggrieved by the fact that they are individual pharmacy and chemist shops and they have earned their reputation in their area of businesses by dint of their sincere efforts and goodwill earned by rendering their services to consumers. The petitioners contend that the insertion of the said clause will not permit individual or smaller establishments like the petitioners to participate in the bidding process and it will be left open to only the chain pharmacies operating in several parts of the country. Being aggrieved, the present writ petition has been filed. Seeking issuance of writ of mandamus for setting aside and quashing Tender No. L26NC19001 dated 22.03.2019 and also with a direction to hold the Bid Evaluation and Criteria Clause B.1.2 (i) and (ii) to be arbitral, discriminatory and accordingly, issue appropriate orders interfered with the said criteria.

4. Mr. G.N Sahewalla, learned Senior counsel for the respondent submits that Page No.# 5/8

the evaluation clause was decided in a Board Meeting held in the Head Office, New Delhi of the ONGC. The learned Senior for the respondent submits that merely because it is not suitable to the petitioners, the same will be not be a ground for seeking appropriate directions from this Court for setting aside the clause. The learned Senior counsel has referred to the records available in Court to show that the Board decision to go for Chain Pharmacies was taken on 21.02.2019. Pursuant thereto, a fresh NIT was issued on 21.03.2019 and the earlier EMD was returned and the earlier NIT was withdrawn. During the course of hearing, the learned Senior counsel referred to a decision rendered by a Division Bench of this Court in W.A. No. 116/2021 which was delivered on 29.06.2021. The learned Senior counsel referring to the said Judgment submits that in a similar matter filed by other similarly situated persons, the issue of the evaluation criteria being Clause B.1.2 of the NIT was a matter of challenge. The writ petition was initially allowed by a Single Bench of this Court interfering with the evaluation criteria. However, on appeal by the order dated 29.06.2021 passed in W.A. No. 116/2021, the Division Bench over turned the Judgment of the learned Single Judge. The Division Bench of this Court by referring to various Judgments of the Apex Court arrived at a finding that in matters of contract, the scope of judicial review and tender process is extremely limited. The Division Bench did not find any infirmity with the decision of the Board in coming out with its decision to call for chain medical suppliers/stores which offered medicines to the employees 24 X 7. A Division Bench was of the view that if the ONGC authorities felt that empanelment of such chain pharmacies are in the interest of employees on their families, there could be no interference by this Court. The relevant paragraphs of the Judgment are extracted below:

23. All the aforesaid judgments point out that the scope of judicial review in contractual and in tender process is extremely limited.

Page No.# 6/8

24. Coming to the submission of Mr. M.K. Choudhury, learned senior counsel for the respondents who submits that the eligibility condition has ousted the petitioners and others and it is tailor-made to suit big corporate houses, it must be stated that the ONGC is the best judge to evaluate as to what is most suitable to its employees and if in its judgment they have come to the conclusion that the present process would suit them better, then the process cannot be faulted merely because the petitioners are now ineligible to meet the pre-conditions. On our consideration of all the relevant factors, we have absolutely no doubt in our mind that under the new scheme the interest and well being of the employees of ONGC was the prime considerations. The scheme and its conditions are in public interest and therefore even if the implementation of the scheme is contrary to the interest of a few chemists and pharmacists, it will not run contrary to the overall merit of the scheme.

25. The contention of the learned senior counsel appearing for the respondents that the decision of the ONGC is only to implement the scheme in metropolitan cities is also not correct. This Court has been informed that the process is being carried out even in smaller towns like Rajahmundry in Andhra Pradesh and Agartala in Tripura, both of which have a much smaller population compared to Sivasagar which has a population of 11.5 lakhs. The contention of the learned senior counsel for the respondents that the eligibility conditions have absolutely no nexus with the object sought to be achieved is also not correct. There is definitely a purpose in bringing out the scheme, which is to get better quality medicines at cheaper rates 24 X 7 to its employees. It has already been come in the interim orders of this Court that it is an admitted case that the petitioners will not be able to supply medicines at the rates required by the ONGC. So, in any case, they are not qualified now to participate in the bid. We do not agree with the reasoning given by the learned Single Judge that the action of the ONGC violates the fundamental rights of the petitioners given to them under Articles 14, 19(1)(g) and 21 of the Constitution of India. We are afraid that the findings of the learned Single Judge that the estimated annualize contract value in all the centres comes up to only Rs.91,50,000/- is a finding which is not reflected either form the record or the pleadings. In fact, the total value of all the running contracts which were awarded to total thirteen numbers of suppliers for different locations comes to Rs.36 Crores and it is on this basis that projections of Rs.54 Crores have been calculated for next three years. Similarly, there is nothing on record to show that the land of the petitioners was acquired by the ONGC. Consequently, we allow these writ appeals and set aside the order of the learned Single Judge dated 02.03.2021 passed in WP(C) No.3230/2020 and WP(C) No.3079/2020.

We must, however, note that since the ongoing contract in favour of the petitioners has been extended till 18.08.2021, that shall not be disturbed till 18.08.2021 Page No.# 7/8

5. Upon the last date of hearing in this matter, the learned Senior counsel for the petitioners submitted that although the Division Bench upheld the decision of the Board for Chain Pharmacies and overturned the Judgment of the learned Single Judge, however, in respect of withdrawal of the earlier tender pursuant to evaluation of technical and financial bids, there has to an administrative decision taken by the ONGC, Nazira. The learned Senior counsel submits that whether such a decision was taken or not and if such a decision was not taken then perhaps this Court would like to examine this issue in respect of withdrawal of the earlier tender process.

6. The learned counsel on record appearing for the ONGC produced the records. Upon due perusal of the records, it is seen that pursuant to the Board's decision taken on 21.02.2019, the administrative decision was also taken to close the earlier tender process and return the EMD and go for fresh tendering.

7. Considering the fact that the Board's decisions are a part of the records of the Department, this Court propose not to extract the same. However, copy of the Minutes of the meeting held on 19.02.2019 reflecting the Board's decision is kept as a part of the case record.

8. In view of all the above, considering the fact that Division Bench of this Court has declined to interfere with the decision taken by the ONGC in its Board Meeting in the Head Office, New Delhi to call for Chain Pharmacies and thereby declining to interfere with the tender process, this Court does not find any reason to proceed any further in the matter and propose to reject the contentions made by the petitioners. It is also submitted at the Bar that during the process of issuance of the tender, since the matter was pending before this Court, extensions were given to the petitioners and the extension to the Page No.# 8/8

petitioners will expire on 31.12.2021. It is fairly submitted by the learned Senior counsel for the ONGC that since the extensions were given by the ONGC till 31.12.2021, the same will be allowed to continue notwithstanding the Judgment of this Court passed in W.A. No. 116/2021.

9. Accordingly, this writ petition stands disposed of in terms of the above.

JUDGE

Comparing Assistant