M/S Falcon Engineering vs Ut Of J&K And Others
2025 Latest Caselaw 856 J&K/2

Jammu & Kashmir High Court - Srinagar Bench

M/S Falcon Engineering vs Ut Of J&K And Others on 1 March, 2025

Author: Rajnesh Oswal

Bench: Rajnesh Oswal

     HIGH COURT OF JAMMU & KASHMIR AND LADAKH
                    AT SRINAGAR
                            (THROUGH VIRTUAL MODE)

                                                            Reserved on    24.02.2025
                                                            Pronounced on. 01.03.2025

WP(C) No. 2956/2024

M/s Falcon Engineering                      .....Appellant(s)/Petitioner(s)
                   Through: Mr. Javed Ahmad Kachroo, Advocate
                            Mr. Luqman, Advocate

              Vs
UT of J&K and others                                                 ..... Respondent(s)


                   Through: Mr. A. R. Malik, Sr. AAG
                            Mr. Mohd Younis, Advocate
                            Mr. Bhat Fayaz Ahmad, Advocate


 Coram: HON'BLE MR. JUSTICE RAJNESH OSWAL, JUDGE

                                  JUDGMENT

1. The official respondents issued e-NIT No. 41 of 2024-25 dated 13.08.2024

in respect of the work captioned as "Allied Works at Transit

Accommodation at Baba Daryadin Ganderbal" and the last date for

submission of the bids was 30.08.2024 (4.00 pm). The date and time of

opening of the technical bids (online) was 31.08.2024 at 11.00 AM. The

official respondents received the bids of the petitioner as well as respondent

No.5.The technical bids were opened on 03.10.2024 and both the bidders

were declared responsive during technical evaluation. Thereafter,

representation/complaint dated 03.10.2024 was submitted by the respondent

No. 5 against the petitioner stating therein that the petitioner has concealed

its ongoing work/existing commitment, in respect of work of

"construction/raising of second floor of Admin, Block (Phase 3) towards

south side of the Main Campus" and acting upon the said representation, a

communication dated 30.11.2024 was issued by the official respondents in

terms of which the petitioner was declared "Non-responsive" without

affording any opportunity of being heard to it, as urged by the petitioner. It is

contended by the petitioner that the petitioner was never intimated about the

representation/complaint submitted by the respondent No. 5 and as a matter

of fact, it came to know about the said representation/complaint only after

the said representation was considered and decision thereon was arrived at

by the official respondents. The petitioner immediately after being declared

"non-responsive" on 30.11.2024, on the next working day i.e. 02.12.2024

(01.12.2024 being Sunday) filed its objections in terms of Clause 22.6 of

Standard Biding Documents (SBDs) of aforesaid e-NIT. The official

respondents, without waiting for the mandatory period of two working days

and allowing the petitioner to file objections against the decision of the

official respondents, opened the financial bid of the sole responsive bidder

i.e. respondent No. 5 at 02.17 pm on the same day i.e. 02.12.2024.

2. It is alleged by the petitioner that the mode and manner, in which the official

respondents have dealt with the matter speak volumes of the arbitrary and

capricious exercise of powers by the official respondents. It is also

contended by the petitioner that before the opening of financial bid of the

respondent No.5 at 02.17 P.M on 02.12.2024, a communication was

uploaded at 11.41 AM on the portal by respondent No.4, in terms whereof,

the e-NIT was revoked by respondent No.2 and despite revocation of the said

e-NIT at 11.41 AM by the official respondents, the financial bid was opened

thereafter, which clearly shows that the respondents have acted in an

arbitrary and capricious manner. It is stated by the petitioner that had any

opportunity of being heard been afforded to the petitioner, it would have

been clarified that at the time of submission of bid i.e. on 30.08.2024, neither

the letter of acceptance nor allotment order was issued in favour of the

petitioner, as such, it would not constitute an „existing commitment or

ongoing work‟ because bid was yet to be accepted by the concerned officer,

rather the work was allotted to the petitioner only on 11.10.2024 i.e. 43 days

after the last date of submission of the bids. The petitioner has further stated

that almost in two similar cases, in terms of which the same issue of

misinterpretation of Clause 4.6 of the SBDs i.e. disclosing of existing works

which were being carried, was analyzed and decided in favour of the

tenderers. By placing these facts before this Court, the petitioner has sought

the quashing of communication dated 30.11.2024 in terms whereof the

petitioner has been declared as "Non-responsive" in relation to e-NIT No. 41

dated 13.08.2024. Further reliefs are also sought for the quashing of

communication dated 02.12.2024 in terms whereof the financial bid stands

opened and quashing of communication dated 12.12.2024 in terms whereof

the respondent No. 5 has been ordered to proceed with the execution of

above said work.

3. The official respondents have filed the response, stating therein that the

representation was submitted by the respondent No. 5 against the petitioner,

wherein it was contended that there were three shortcomings in the

documents uploaded by the petitioner including the one that the petitioner

had concealed the ongoing existing commitment vis-à-vis "raising of second

floor of Administration Block (Phase-3) towards south side at the Main

Campus. The Tender Evaluation Committee after due deliberation decided

that other two objections cannot be entertained, but objection regarding

concealment of existing commitment qua the raising of 2nd floor of

Administration Block (Phase-3) towards south side at the Main Campus was

taken up with the Executive Engineer, Construction Division, University of

Kashmir vide communication dated 05.10.2024 and the University of

Kashmir vide communication dated 07.10.2024 replied the queries by stating

that the bids for the work raising of 2nd Floor of Administration Block

(Phasee-3) towards south side at Main Campus were invited on 04.06.2024

and the financial bids were opened on 05.07.2024. M/s Falcon Construction

Company, the petitioner was found to be an L1 bidder but due to the

imposition of Model Code of Conduct, the letter of acceptance/Contract

allotment letter in favour of the Agency could not be issued. It has also been

mentioned in the reply that the lowest bidder, namely, M/s Construction

Engineer, Builders Contractors, Engineers, Fabricators for the work of

"construction of 04 storied Research Hostel at Zakura Campus" has

appointed M/s Falcon Construction Company as sub-contractor for the work

and the sub-contract agreement between both the parties stands accepted by

the competent authority. The committee after receipt of the aforementioned

reply from the University of Kashmir and subsequent deliberations, decided

that the petitioner has concealed the information with regard to existing

commitment, therefore, it is liable to be declared as non-responsive and

accordingly, it was unanimously decided by the Tender Evaluation

Committee to declare the petitioner as Non-responsive and the decision was

uploaded vide Revised Technical Evaluation Summary Sheet dated

30.11.2024 with the note citing the reasons therefor.

4. It has been further stated that since the petitioner was supposed to declare

and disclose all the existing commitments, which was not done by the

petitioner, which was duly confirmed by the employer i.e. University of

Kashmir, as such, two days‟ time period for calling of the objections was not

applicable to the petitioner as the petitioner was declared non-responsive due

to concealment of some facts. It is stated that if it had been a case of

declaring the petitioner non-responsive due to some technical shortcomings,

it would have surely been provided the time to respond to the action taken by

the Tender Evaluation Committee on 30.11.2024. So far as placing of

reliance on the communication dated 04.09.2023 issued by the

Superintending Engineer, Srinagar South is concerned, in the present case,

the employer-University of Kashmir has confirmed that the work was not

formally allotted only because of Model Code of Conduct implying that the

petitioner (L1) had to execute the said work for sure and it is clearly

understood that the said work was an existing commitment on the part of the

employer as well as the petitioner. It is further stated that the concerned

Executive Engineer had inadvertently written that the NIT is revoked,

instead of writing that the previous summary sheet is revoked, which would

enable him to upload the Revised Summary Sheet dated 30.11.2024. It is

asserted by the official respondents that the procedure adopted by them is

transparent and in accordance with law.

5. The petitioner has filed the reply to the objections filed by the respondents

reiterating therein that in view of the reply to the queries by the Kashmir

University, it is evident that the contract itself was not allotted to the

petitioner and work did not even exist at the time when the bids were

submitted and in absence of such a work being in existence officially, there

was no reason for the petitioner to disclose the same. It is further stated by

the petitioner that the petitioner was never informed with regard to the filing

of the representation and as such, he has been deprived of opportunity of

being heard. It is also averred that the contention of the official respondents

that Clause 22.6 of SBDs is not applicable to the petitioner, is without any

basis, as said Clause itself is based on the principle of natural justice. The

petitioner has denied the contentions raised by the respondents in their reply.

6. Mr. Javed Ahmad Kachroo, learned counsel for petitioner has reiterated the

submissions made in the petition and has laid much stress that the petitioner

was not having ongoing work as alleged by the official respondents which

the petitioner concealed from the official respondents because the contract

was allotted to the petitioner after 43 days of submission of bids. He has

further argued that no opportunity of hearing has been afforded to the

petitioner before passing the order on the representation filed by the

respondent No. 5. He has also argued that two different yardsticks cannot be

applied while dealing with the same situation.

7. Per contra, Mr. Abdul Rashid Malik, learned Sr. AAG has argued that the

petitioner was L1 bidder in respect of the e-NIT of Kashmir University and

once he was declared as L1 bidder, he was committed towards the said work

and the purpose of disclosing the commitment in respect of ongoing and

existing works is to ensure that proper human and financial resources are

available with the bidder. He has further submitted that the petitioner has

concealed its ongoing work/existing commitment, as such, the official

respondents have rightly declared the petitioner "non-responsive" in respect

of the NIT in question. He has also argued that it was wrongly mentioned on

the portal that the tender has been revoked, whereas the earlier technical

evaluation report was to be revoked and further that the communication

dated 04.09.2003 relied upon by the petitioner does not belong to their office

and otherwise too, the same cannot come to the rescue of the petitioner.

8. Heard learned counsel for the parties and perused the record.

9. The first ground urged by the petitioner is that no opportunity of hearing was

afforded to the petitioner in terms of Clause 22.6 of the SBDs. Clause 22.6 of

the SBDs provides that the result of technical evaluation shall be made

public on jktenders.gov.in site following which there will be a period of two

working days during which any bidder may submit objections, if any, in

writing to the tender receiving authority, which shall be considered for

resolution before opening of financial bids. In the present case, initially both

the bidders i.e. private respondent No. 5 and the petitioner were declared

responsive during technical evaluation of the bids vide communication dated

03.10.2024. Thereafter, a representation/complaint was filed by the

respondent No. 5 to the official respondents to the effect that the petitioner

concealed its ongoing work/existing commitment, in respect of

"construction/raising of second floor of Admin, Block (Phase 3) towards

south side of Main Campus, which was considered by the official

respondents and vide its communication dated 30.11.2024, the petitioner was

declared as „non-responsive‟. This is a fact that no opportunity of hearing has

been afforded to the petitioner before declaring him non-responsive vide

communication dated 30.11.2024 pursuant to the representation/complaint

submitted by the respondent No.5, but it appears from the record that the

official respondents did not simply act on the complaint/representation of the

respondent No.5, but they sought information from the University of

Kashmir and the University of Kashmir vide communication dated

07.10.2024 stated that the bids for the work "raising of 2ndFlooor of

Administration Block (Phase-3) towards south side at Main Campus were

invited on 04.06.2024 and the financial bids were opened on 05.07.2024.

M/s Falcon Construction Company was found to be an L1 bidder, however,

due to imposition of Model Code of Conduct, the letter of

acceptance/Contract allotment letter in favour of the agency could not be

issued. Taking into consideration the reply submitted by the University of

Kashmir, the petitioner was declared as non-responsive vide Revised

Technical Evaluation Summary Sheet dated 30.11.2024. This is not the case

herein that the official respondents declared the petitioner non-responsive at

the time of opening of technical bids, but the petitioner was declared to be

non-responsive only after the complaint/representation was submitted by

respondent No.5. Technically, there is no violation of Clause 22.6 of SBDs.

This is also not the case, where the official respondents have taken the

decision without eliciting the information from University of Kashmir. Had

the official respondents taken a decision solely on the

representation/complaint of the respondent No.5, then the petitioner would

have been right in submitting that not affording the opportunity of hearing to

the petitioner before declaring it non-responsive has caused prejudice to it.

The petitioner has admitted that the petitioner was declared to be an L-1

bidder by University of Kashmir and it is not that the petitioner has new

facts, which the petitioner could not bring to the notice of the official

respondents for want of notice and as such the petitioner cannot claim to

have been prejudiced by non-affording of opportunity of hearing by the

official respondents before declaring the petitioner non-responsive.

10. It would be profitable to take note of the judgment of the Apex Court in

State of Uttar Pradesh versus Sudhir Kumar Singh, 2020 SCC Online

SC 847, wherein Apex Court considered the scope of audi alteram partem

and has observed as under:

39. An analysis of the aforesaid judgments thus reveals:

(1) Natural justice is a flexible tool in the hands of the judiciary to reach out in fit cases to remedy injustice. The breach of the audi alteram partem rule cannot by itself, without more, lead to the conclusion that prejudice is thereby caused. (2) Where procedural and/or substantive provisions of law embody the principles of natural justice, their infraction per se does not lead to invalidity of the orders passed. Here again, prejudice must be caused to the litigant, except in the case of a mandatory provision of law which is conceived not only in individual interest, but also in public interest. (3) No prejudice is caused to the person complaining of the breach of natural justice where such person does not dispute the case against him or it. This can happen by reason of estoppel, acquiescence, waiver and by way of non-challenge or non-denial or admission of facts, in cases in which the Court finds on facts that no real prejudice can therefore be said to have been caused to the person complaining of the breach of natural justice.

(4) In cases where facts can be stated to be admitted or indisputable, and only one conclusion is possible, the Court does not pass futile orders of setting aside or remand when there is, in fact, no prejudice caused. This conclusion must be drawn by the along with connected matters Court on an appraisal of the facts of a case, and not by the authority who denies natural justice to a person.

(5) The "prejudice" exception must be more than a mere apprehension or even a reasonable suspicion of a litigant. It should exist as a matter of fact, or be based upon a definite inference of likelihood of prejudice flowing from the non-

observance of natural justice.

(emphasis added)

11. It is also urged that no contract was issued in favour of the petitioner by the

University of Kashmir, as such, non-disclosure of the same would not

amount to concealment of fact in respect of "existing commitments and

ongoing construction works", which the bidder was mandated to disclose.

Clause 1.5(b)(2) of Appendix to ITB mandated the disclosure of existing

commitments and ongoing construction works in a tabular form. As per the

stand of the official respondents, the petitioner was declared to be an L1

bidder by University of Kashmir in respect of raising of 2 nd Floor of

Administration Block (Phasee-3) towards south side at Main Campus and the

non-disclosure of the same amounts to concealment of fact. Clause 4.6(C) of

SBDs provides that to qualify for a package of contracts, the bidder must

demonstrate having experience and resources sufficient to meet the

aggregate of the qualifying criteria for the individual contracts. Clause 4.6 of

the SBDs provides that the bidder, who meets the minimum qualification

criteria will qualify only if their available bid capacity is more than the total

estimated cost of the works. It also provides the formula for calculating the

available bid capacity. Note appended to Clause 4.6(C) of the SBDs provides

that the statements showing the value of existing commitments and ongoing

works as well as the stipulated period of completion remaining for each of

the works listed should be countersigned by the Engineer in-charge not

below the rank of an Executive Engineer or equivalent. The certificate

should be furnished as per format shown in qualification information

(section 2). The official respondents have taken a decision that non-

disclosure on the part of the petitioner as a successful bidder in the tender

floated by the University of Kashmir for raising of 2 ndFlooor of

Administration Block (Phasee-3) towards south side at Main Campus,

amounts to concealment of existing commitment. In that case the allotment

order could not be issued only because of the imposition of the Model Code

of Conduct and but for imposition of Model Code of Conduct, the contract

would have been allotted to the petitioner, meaning thereby that the

petitioner in fact had committed to execute the work for which he had

participated in tendering process and declared to be an L1 bidder. The

respondents have placed on record the mechanism for determining the

financial and technical capacity of the bidder so as to ensure that proper

resources and manpower are available at the disposal of the contractor for

timely completion of the contract. The official respondents are of the opinion

that once the petitioner has been declared as L-1 bidder, though not allotted

contract work due to imposition of Model Code of Conduct and the factum

of non-disclosure of the same, would fall within the meaning of existing

commitments. This Court is of the considered view that the opinion formed

by the official respondents cannot be faulted.

12. Further in terms of Clause 28.1 of the SBD, the employer reserves the right

to accept or reject any bid and to cancel the bidding process and reject all

bids at any time prior to award of contract without thereby incurring any

liability to the affected bidder or bidders or any obligation to inform the

affected bidder or bidders of the grounds for the employer‟s action. Once the

tender inviting authority, i.e. the official respondents have taken a decision

with regard to the concealment of fact, this Court cannot sit as a court of

appeal over the decision taken by the Tender Inviting Authority. In this

context, it would be appropriate to refer to the decision of the Apex Court in

Afcons Infrastructure Limited v Nagpur Metro Rail Corporation

Limited and another, (2016) 16 SCC 818 in which, the Apex Court has

held 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."

(emphasis added)

12. The Apex Court in „Uflex Limited v Government of Tamil Nadu (2022) 1

SCC 165' held as under:

"2. The judicial review of such contractual matters has its own limitations. It is in this context of judicial review of administrative actions that this Court has opined that it is intended to prevent arbitrariness, irrationality, unreasonableness, bias and mala fide. The purpose is to check whether the choice of decision is made lawfully and not to check whether the choice of decision is sound. In evaluating tenders and awarding contracts, the parties are to be governed by principles of commercial prudence.To that extent, principles of equity and natural justice have to stay at a distance."

(emphasis added)

13. It would also be apt to take note of the judgment the Hon'ble Apex Court in

'Silppi construction Contractors vs. Union Of India, 2019 SCC Online

SC 1133‟, wherein it has been held as under:

"20. The essence of the law laid down in the judgments referred to above is the exercise of restraint and caution; the need for overwhelming public interest to justify judicial intervention in matters of contract involving the state instrumentalities; the courts should give way to the opinion of the experts unless the decision is totally arbitrary or unreasonable; the court does not sit like a court of appeal over the appropriate authority; the

court must realise that the authority floating the tender is the best judge of its requirements and, therefore, the court's interference should be minimal. The authority which floats the contract or tender, and has authored the tender documents is the best judge as to how the documents have to be interpreted. If two interpretations are possible then the interpretation of the author must be accepted. The courts will only interfere to prevent arbitrariness, irrationality, bias, mala fides or perversity. With this approach in mind we shall deal with the present case."

(emphasis added)

In view of the above, there is no force in this contention raised by the

petitioner. Accordingly, the same is rejected.

14. The second contention raised by the petitioner is that the official respondents

had revoked the tender and published the same on the website portal at 11.41

AM and once the tender was revoked there was no occasion for the

respondents to open the financial bid at 2.17 P.M. on 2nd December 2024.

The official respondents in their objections have categorically stated that due

to mistake, the concerned Executive Engineer had inadvertently written that

e-NIT is revoked, instead of writing that previous technical bid evaluation

summary sheet is revoked. The official respondents have sufficiently

explained the publication of the communication in respect of the revocation

of the e-NIT due to the mistake of the concerned Executive Engineer and

there is no reason for this Court to doubt the same.

15. Lastly, it is contended by the petitioner that the office of the Superintendent

Engineer (R&B) Circle South vide communication dated 04.09.2023 has

observed that as the contract in that case was not allotted in favour of the

bidder therein, so the same cannot be treated as existing commitment. A

perusal of the communication dated 04.09.2023 reveals that in the said case

the contract was not allotted in favour of the bidder and as such, the same

was not considered as existing commitment. So far as the present case is

concerned, the petitioner has been declared as L-1 in the e-NIT floated by the

University of Kashmir and the contract could not be allotted to the petitioner

because of operation of Model Code of Conduct. The case of the petitioner is

distinguishable from the case projected by the petitioner as contained in

communication dated 04.09.2023 as it is not forthcoming from the

communication dated 04.09.2023 as to whether the bidder therein was

declared to be an L-1 or not. The respondents have taken a decision that

declaration of the petitioner as L1 bidder would fall within the meaning of

existing commitment. It is for the employer to interpret the terms and

conditions of its contract, and the Court cannot substitute the decision of the

employer with its decision merely because other view is also possible.

16. In view of what has been said and discussed hereinabove, this Court is of the

considered opinion that there is no merit in the present petition. The same

deserves to be dismissed, hence dismissed. Interim direction, if any, shall

stand vacated.

(RAJNESH OSWAL) JUDGE

Jammu:

01.03.2025 Karam Chand/Secy.

                                      Whether the order is speaking:     Yes
                                      Whether the order is reportable:   Yes