M/S Piya Communication vs Union Of India And Others
2021 Latest Caselaw 923 j&K

  THE HIGH COURT OF JAMMU & KASHMIR AND LADAKH
                     AT JAMMU

                                                   WP(C) No. 1246/2021
                                                     CM No. 5103/2021
                                                     CM No. 5252/2021

                                             Pronounced on: 21.08.2021

M/s Piya Communication                          .... Petitioner/Appellant(s)

                                  Through:- Mr. Ajay Bakshi, Advocate

                            V/s

Union of India and others                                .....Respondent(s)

                                  Through:- Mr. Vishal Sharma, ASGI


CORAM : HON'BLE MRS. JUSTICE SINDHU SHARMA, JUDGE
                                  JUDGMENT

01. A Request For Proposal (RFP) inviting bids for 85 conserving

staff and 7 Excavators with trolley and with drivers for the financial

year 2021-22 was issued for Akhnoor Military Station on 04.04.2021.

The petitioner alongwith other eligible contractors, participated in

tender bids and after evaluation of the bids was declared as L1 as per

bid detail No. GM/2021/B/1156225.

02. Two contractors, who had participated in the tender bids, filed

the writ petition titled Satish Kumar & anr. Vs. Union of India & ors.

bearing WP(C) No. 944/2021 assailing the eligibility of the petitioner to

participate in the tender bids. In the aforesaid petition, the respondents

vide order dated 06.05.2021 were directed to file short affidavit

showing the eligibility of the petitioner to participate in the bid process

in terms of Clause I(d) of General Information of NIT issued for the

Financial Year 2021-22 for engagement of contractors for Conserving

Service. The respondents in their affidavit submitted that the M/s Piya

Communication possessed the requisite eligibility and was accordingly,

declared as L1 while petitioner Nos. 1 and 2 in the aforesaid petition

were declared L3 and L4 respectively and, therefore, were not entitled

for allotment of the contract. After considering the objections, vide

order dated 18.05.2021, the official respondents in the aforesaid

petition were permitted to go ahead with the process of allotment. The

respondents, however, did not proceed with the allotment of contract to

the petitioner constrained him to file the present petition.

03. The petitioner is aggrieved of the action of the respondents of

not allotting the contract to him as per the impugned e-NIT and prays

for the following reliefs:

"I. Writ of Mandamus, directing the respondents, especially respondent No. 4 to proceed Request For Proposal (RFP) No. 312/SH/OS/Corrs/Q dated 4.04.2021 invited by the respondents whereby the petitioner was declared as L1 being eligible under the criteria of Class I Request For Proposal(RFP);

II. Writ of Prohibitory, restraining the respondents not to invite fresh Request For Proposal (RFP) No. 312/SH/OS/Corrs/Q dated 4.04.2021 inviting for bids for Akhnoor Military Station for 85 conserving staff and 7 Excavators with trolley and with drivers for the financial year 2021-22; and III. Any other writ, order or directions which this Hon‟ble Court deems fit under the circumstances of the case may kindly be passed in favour of petitioner."

04. The action of the respondents in not finalizing the allotment of

contract pursuant to RFA for Conservancy Staff to the petitioner, has

been assailed by the petitioner as being arbitrary and the same has

resulted in vitiating the rights of the petitioner. As per the petitioner,

since he possess the requisite eligibility was declared as L1, the

respondents, therefore, should have processed and allotted the contract

to him. More so when in earlier writ petition, they have admitted his

eligibility, therefore, the process should have been concluded and the

contract allotted to him.

05. Mr. Vishal Sharma, learned ASGI submits that though the

Technical Evaluation Committee (TEC) after evaluation of the

technical bid of the petitioner declared him eligible as L1 but the same

was subject to approval of higher authority, i.e, the GOC 16 Corps

(CFA). The higher authority in its communication dated 26.06.2021,

observed that there was ambiguity in the criteria prescribed for

experience in Part-I, para (1)(d) for Proof of Similar Works Already

Undertaken and the same has been misinterpreted by the Station HQ

Akhnoor. The Headquarter Northern Command vide letter No.

3003/2005 dated 27.05.2021 held that „unskilled labour‟ cannot replace

outsourcing Conservancy Service. As the petitioner, according to

respondents, did not meet the requisite criteria and, therefore, the same

was not approved and the respondents cancelled the tender process for

the outsourcing of conservancy services for Financial Year 2021-22 and

a fresh tender process for the same was directed to be carried out.

06. The petitioner submits that this cancellation is arbitrary and for

malafide reasons. The requisite eligibility as per the Request For

Proposal (RFP). The relevant Part-I, Para (1)(d) of the NIT of contract

for Conservancy Service reads as under:

"1. Eligibility Criteria for Vendors. Vendor fulfilling the following criteria are eligible to submit the tender:-

......................

(d).Proof of Similar Works Already Undertaken: The vendor should have three years experience with the

Government Agencies for providing Conservancy services. He should have average annual turnover of one third of the Bid Amount."

The petitioner in response to the eligibility criteria has

submitted four experience certificates; (1) Experience certificate dated

22.05.2019 issued by Municipality Committee Akhnoor for providing

Conservancy service for the year 2019-20 (2) Experience Certificate

dated 29.04.2018 issued by Commanding Officer 13 Punjab (Jind) for

providing Conservancy Service w.e.f 08.02.2018 to 28.04.2018 (3)

Experience certificate dated 20.04.2019 issued by Commanding Officer

Punjab (Jind) for providing Conservancy Service w.e.f 25.02.2019 to

06.04.2019 (4) Experience Certificate dated 20.08.2018 issued by

Alliance Enterprises for providing Manpower w.e.f. November, 2015 to

January, 2018.

07. The stand of the respondents is that the Technical Evaluation

Committee (TEC) while evaluating the Technical qualification of the

bidder has misinterpreted Part-I, Para-1(d) of the Request For Proposal

(RFP) and, accordingly, the clause with respect to similar services other

than Conservancy Services and accepted the experience certificate

issued by the Alliance Enterprises for providing Manpower (Unskilled

Labour) w.e.f. November, 2015 to January, 2018 for calculating the

experience in terms of RFP further they also considered the two

certificates issued by Commanding Officer for the whole year whereas

the same was only for two months and 20 days in the year 2018 and one

month and 13 days for the year 2019. Accordingly, the petitioner was

declared L1. However, allotment of contract was subject to approval of

the higher authority, i.e., the GOC 16 Corps (CFA).

08. The Higher Authority after analyzing the entire process held that

there was ambiguity with regard to the criteria specified with

experience. It was held that the same was misinterpreted by the Station

HQ Akhnoor with respect to similar works undertaken by the petitioner

and the same was clarified that „unskilled labour‟ cannot replace

outsourcing of Conservancy Services, therefore, the petitioner was

found ineligible of the allotment of contract and the contract was not

approved by the CFA and direction was issued to carry out fresh tender

process.

09. Learned counsel for the petitioner, however, has submitted that

Para (1)(d) of the NIT cannot be interpreted to the disadvantage of the

petitioner whereas respondents submit that as per tender document, the

petitioner should have had proof of providing Conservancy Services as

per schedule of requirement which he did not possess. The question

with regard to interpretation of tender document had been considered

by Hon‟ble the Supreme Court in Afcons Infrastructure Ltd. V.

Nagpur Metro Rail Corporation Ltd., 2016(16) SCC 818, Para 15 of

which is as under:

"15. We may add that the owner or the employer of a project, having authored the tender documents, is the best person to understand and appreciate its requirements and interpret its documents. The constitutional Courts must defer to this understanding and appreciation of the tender documents, unless there is mala fide or perversity in the understanding or appreciation or in the application of the terms of the tender conditions. It is possible that the owner or employer of a project may give an interpretation to the tender documents that is not acceptable to the

constitutional Courts but that by itself is not a reason for interfering with the interpretation given."

In view of the settled position of law, it is the respondents who

are best persons to understand and appreciate the requirements of

tender documents and interpret the same. The only consideration being

in awarding contract is that the public interest is to be of paramount

consideration and there should be no arbitrariness in awarding contract

as all participants must be treated alike. In „Tata Cellular Vs. Union of

India, 1994 (6) SCC 651, while considering the scope of judicial

review, it was held as under:

"Before interfering in tender or contractual matter, the Court in exercise of its powers of judicial review should pose to itself the following questions:

(a) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone or whether the process adopted or decision made is so arbitrary or irrational that the Court can say that the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached;

(b) Whether the public interest affects, if the answer is in the negative, there should be no interference under Article-226 of the Constitution and judicial review it appears is always to test the grievance under Article 14 of the constitution."

After considering the fact that since there was no illegality,

irrationality or procedural impropriety conducted by the decision

making authority, therefore, this Court cannot sit in an appeal over the

decision of the respondents. The Courts have only to examine, if the

decision making process was fair reasonable, transparent arbitrary with

no perceptible injury to public.

10. The fact that approval was not granted and the contract was

cancelled and all the participants are treated alike, therefore, no ground

for interference in exercise of judicial review is made out. The scope of

judicial interference with regard to contractual matter is only to see that

there is no malafides or arbitrariness in the decision making process.

This not being the case in the present petition, as the respondents

neither acted arbitrarily or for malafide reasons neither is same

irrational and the decision has been taken based on the opinion of

experts, who after noticing the misinterpretation, cancelled the NIT and

directed of fresh tender. Thus, no ground for interference is made out in

view of the law as laid down in Jagdish Mandal V. State of Orissa

and others' (2007) 14 SCC 517 in which the Supreme Court was

pleased to hold as under:

"22. Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and malafides. Its purpose is to check whether choice or decision is made 'lawfully' and not to check whether choice or decision is 'sound'. When the power of judicial review is invoked in matters relating to tenders or award of contracts, certain special features should be borne in mind. A contract is a commercial transaction. Evaluating tenders and awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona fide and is in public interest, courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary

grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review, should be resisted. Such interferences, either interim or final, may hold up public works for years, or delay relief and succour to thousands and millions and may increase the project cost manifold."

11. This apart the Request For Proposal (RFP) also includes

Condition No. 4 which reads as under:

"4. This RFP is being issued with no financial commitment and the Buyer reserves the right to change or vary any part thereof at any stage. Buyers also reserve the right to withdraw the RFP, should it become necessary at any stage."

As per this, the respondents could vary or change any part of

the tender and also had the right to withdraw the same at any stage.

Considering that the respondents had deemed it necessary to cancelled

due to misinterpretation which they are well within their right to do so.

In view of the aforesaid discussion, there is no merit in this petition

and, the same, is accordingly, dismissed alongwith connected

application(s).

(Sindhu Sharma) Judge JAMMU 21.08.2021 SUNIL-II Whether the order is speaking : Yes Whether the order is reportable : Yes

SUNIL KUMAR 2021.09.02 16:45 I attest to the accuracy and integrity of this document