Shaligram Singh vs The State Of Jharkhand
2024 Latest Caselaw 3547 Jhar

Jharkhand High Court

Shaligram Singh vs The State Of Jharkhand on 3 April, 2024

Author: Rongon Mukhopadhyay

Bench: Rongon Mukhopadhyay, Deepak Roshan

         IN THE HIGH COURT OF JHARKHAND AT RANCHI
                         W.P.(C) No. 6196 of 2023
                                     ---------
         Shaligram Singh, a proprietorship firm through its
         proprietor, Shaligram Singh, S/o Yadunandan Singh, R/o
         Mahabir Bhawan, Suresh Colony, P.O.- Hazaribag, P.S.-
         Sadar, Distt.- Hazaribag-825301           ... ... Petitioner
                                            Versus
         1.   The State of Jharkhand
         2.   The Principal Secretary, Road Construction
              Department, Government of Jharkhand, Office at
              Project Building, Dhurwa, Ranchi
         3.   The Engineer-in-Chief, Department of Road
              Construction, Govt. of Jharkhand, Ranchi-cum-
              Chairman, Departmental Tender Committee, Road
              Construction Department, Govt. of Jharkhand,
              Office at Project Building, Dhurwa, Ranchi
         4.   The Chief Engineer (Communication), Road
              Construction Department, Govt. of Jharkhand
              Ranchi-cum-Member,             Departmental     Tender
              Committee, Road Construction Department, Govt. of
              Jharkhand, Office at Project Building, Dhurwa,
              Ranchi
         5.   Internal Financial Advisor-cum-Joint Secretary,
              Road Construction Department, Govt. of Jharkhand,
              Ranchi-cum-Member,             Departmental     Tender
              Committee, Road Construction Department, Govt. of
              Jharkhand, Office at Project Building, Dhurwa,
              Ranchi
         6.   Preeti    Enterprises,      through     its Proprietor,
              Raghunath Mahto at Harina, P.O.- Nawagarh, P.S.
              Barora, Distt.- Dhanbad, PIN-828306
                                                ... ... Respondents
                                     ---------
    CORAM : HON'BLE MR. JUSTICE RONGON MUKHOPADHYAY
                   HON'BLE MR. JUSTICE DEEPAK ROSHAN
                                     ---------
        For the Petitioner      : Dr. Ashok Kr. Singh, Advocate
        For the Resp.-State     : Mr. Mohan Dubey, A.C. to A.G.
        For the Resp. No. 6     : Mr. Shrestha Gautam, Advocate
                                     ---------
Order No.09/Dated, the 3 April, 2024
                           rd

Per Rongon Mukhopadhyay, J.

Heard Dr. Ashok Kr. Singh, learned counsel for the petitioner, Mr. Mohan Dubey, learned A.C. to A.G. for the respondent-State and Mr. Shrestha Gautam, learned counsel appearing for the respondent no. 6.

2. In this writ application, the petitioner has prayed for the following reliefs:

i. For issuance of an appropriate writ(s), order(s), direction(s), or a writ in the nature of certiorari for quashing the proceedings of the Departmental Tender Committee of Road Construction Department, Government of Jharkhand issued vide letter no. S.S.-P.N.V./07-N.-74/2023 dated 12.10.2023 whereby and whereunder the petitioner firm has been held to be ineligible under clause nos. 16.2 and 4.5 B

(c) of Standard Bidding Document (SBD) and thus disqualified for opening of its Financial Bid for the tender/work in question.

ii. For issuance of an appropriate writ(s), order(s), direction(s), or a writ in the nature of certiorari for quashing and setting aside the letter no. S.S.-PNV/07-Nivida-74/2003- 4775(s) W.E. dated 12.10.2023 whereby and whereunder the Engineer-in-Chief, Road Construction Department, i.e. Respondent no. 3 took a decision to open the financial bids of Daroga Pradhan, Dhanbad and Preeti Enterprises, Dhanbad i.e. respondent no. 6 on 13.10.2023 at 3.30 PM holding these firms only to be substantially responsive.

iii. For issuance of an appropriate writ(s), order(s), direction(s), or a writ in the nature of mandamus commanding upon the concerned respondent authorities to open the financial bid of the petitioner firm and

consider its case for award of the tendered work on the basis of comparative statement to be prepared after opening of the financial bid of the petitioner firm when it is found to be L1 (lowest) bidder.

iv. For issuance of an appropriate writ(s), order(s), direction(s), or a writ in the nature of mandamus commanding upon the respondent authorities not to enter into an agreement with the respondent no. 6 and consequently to issue a work order in favour of respondent no. 6 for execution of the tendered work under reference.

v. For issuance of an appropriate writ(s), order(s), direction(s), or a writ in the nature of mandamus commanding upon the respondent authorities not to take any further step towards the execution of the tendered work unless and until the financial bid of the petitioner firm is opened and a fresh decision is taken on the basis of the comparative statement to be prepared thereafter.

vi. For issuance of an appropriate writ(s), order(s), direction(s), or a writ in the nature of mandamus commanding upon the respondent no. 6 not to take any step towards the execution of the tendered work till the financial bid of the petitioner firm has been opened and a fresh decision is taken on the basis of the financial bid submitted by the petitioner firm.

vii. To stay the operation, implementation and execution of the above mentioned decisions

of the Departmental Tender Committee taken on 12.10.2023 as well as a stay on any further action pursuant to the opening of (two) 2 financial bids on 13.10.2023 at 3.30 PM declaring respondent no. 6 to be the lowest bidder (L1) under this N.I.T. And/Or viii. For issuance of any other appropriate Writ(s)/ order(s)/ direction(s) as this Hon'ble Court may deem fit and proper under the facts and circumstances of this case.

3. By virtue of an amendment application preferred by the petitioner through I.A. No. 2065 of 2024 having been allowed by this Court the petitioner has also challenged the corrigendum issued vide Memo No. 4935(s) dated 25.10.2023 by the Engineer-in-Chief Road Construction Department as well as the proceeding of the Departmental Tender Committee held on 25.10.2023.

4. The facts in brief are that the petitioner is a proprietor firm registered as a Class-1 contractor in the State of Jharkhand through Contractor Shaligram Singh vide letter no. RCD/Online/Class-I/8640 dated 22.02.2022. The Road Construction Department had invited a tender on 10.07.2023 for widening and strengthening/reconstruction of Loharmore (On MDR-237)- Koridih- Murlipahari (On MDR-089) Road (Total Length 7.530 KM) under Road Division, Jamtara for the year 2023-24 vide Tender Reference No. RCD/ JAMTARA/ 621/2023-24. In response to the notice inviting tender the petitioner-firm had submitted its tender on 12.09.2023 along with Bank Certificate as stipulated under Clause 4.5 B (c) for the value of Rs. 4,40,00,000/- and the Bank Certificate as provided under Clause 16.2 of the Standard Bidding Document. In the meeting held on 12.10.2023, the

Departmental Tender Committee held the petitioner-firm ineligible in view of the provisions as contained in Clause 16.2 and 4.5 B (c) of the Standard Bidding Document vide letter no. S.S.-PNV/07-N.-74/2003 dated 12.10.2023. After the petitioner-firm was technically ineligible the respondent- authorities have declared Preeti Enterprises (respondent no. 6) as the lowest bidder and have taken a decision to award the work to respondent no. 6. It has been stated that a 3rd Departmental Tender Committee meeting was held on 25.10.2023 wherein the petitioner was held to be technically disqualified on account of being unresponsive also to Clause 4.3 (h) besides 4.5 B (c). A corrigendum was issued with regard to Clause 16.2 which was now to be read as Clause 16.3. The decisions of the Departmental Tender Committee was issued vide Memo No. 4935(s) dated 25.10.2023.

5. Dr. Ashok Kr. Singh, learned counsel appearing for the petitioner has submitted that the Bank Certificate furnished by the petitioner along with the bid document is of Rs. 4,40,00,000/- which is much more than the stipulated 10% of the value of estimated cost of the project which is 1.75 times approximately. The bank guarantee submitted by the petitioner as provided in Clause 16.2 of the Standard Bidding Document has a validity period of upto 07.09.2024 which is much beyond the period stipulated in the said Clause. The petitioner-firm, therefore, had fulfilled all the eligibility criteria as per the Standard Bidding Document and there was no occasion for the respondent-authorities to have technically disqualified the petitioner-firm. It has been submitted by Dr. Singh, that in the PWD code or in the Standard Bidding Document there is no provision for review or reconsideration of the decision of the Departmental Tender Committee and to furnish fresh reasons for technical disqualification in the garb of issuance of a corrigendum.

6. Mr. Mohan Dubey, learned A.C. to Advocate General for the respondent-State has submitted that the corrigendum dated 25.10.2023 was issued in continuance and as a supplement to the original Office Order dated 12.10.2023 in terms of which the original order dated 12.10.2023 has been revised and certain corrections to the same has been incorporated by way of corrigendum letter dated 25.10.2023. It has been submitted that the petitioner has been found unresponsive to Clause 4.3 (h) of the Standard Bidding Document as the undertaking provided by the petitioner was not in consonance with Clause 4.3 (h) of the Standard Bidding Document.

7. Mr. Shrestha Gautam, learned counsel appearing for the respondent no. 6 has submitted that there is an error in the Bank Certificate furnished by the petitioner as the name of the work for the contract is mentioned as RWD/JAMTARA/621/2023-24 instead of RCD/JAMTARA/ 621/2023-24 and the period during which the credit facility will be furnished by the firm is also missing. It has been submitted that the Bank Guarantee is not in the prescribed format as indicated in Clause 16.1 (d) of the Standard Bidding Document. Mr. Shrestha Gautam, learned counsel for the respondent no. 6 has also submitted that the respondent no. 6 was declared the L1 bidder and it has commenced the work and has completed 40% of the tender work. It has also been submitted that the State-respondents had acted in all fairness and, therefore, the decision making process cannot be questioned by way of a judicial review.

8. Initially the bid of the petitioner was found to be non-responsive vide Office Order dated 12.10.2023 as it did not cater to the requirements of Clause 16.2 and 4.5 B (c) of the Standard Bidding Document. Subsequently a corrigendum was issued vide letter dated 25.10.2023 to supplement the original Office Order dated 12.10.2023 in which the petitioner-

firm has been declared to be non-responsive by taking recourse to Clause 16.3 and Clause 4.3 (h) in addition to Clause 4.5 B (c) of the Standard Bidding Document.

9. Since Dr. Singh, learned counsel for the petitioner has set forth that all the eligibility criteria in the Standard Bidding Document have been fulfilled by the petitioner, we now venture to give our anxious consideration to the relevant Clauses of the Standard Bidding Document in order to ascertain the submission of the learned counsel for the petitioner regarding a flaw in the decision making process itself.

10. Clause 16.2 and 4.5 B. (c) of the Standard Bidding Document were the clauses which were not complied with by the petitioner as per the original Office Order dated 12.10.2023. These clauses are quoted hereinunder:

"Clause 4.5 B. (c) Liquid assets and/or availability of credit facilities of no less than amount indicated in Appendix (credit lines/letter of credit/certificates from Banks for meeting the funds requirements etc.-usually not less than 10% of the value of estimated cost of the project.) Clause 16.2 Bank guarantees (and other instruments having fixed validity) issued as surety for the bid shall be valid for 45 days beyond the validity of the bid."

11. The corrigendum dated 25.10.2023 referred to Clause 16.3 in place of 16.2 and Clause 4.3 (h) which was in addition to Clause 4.5 B. (c) of the Standard Bidding Document and Clause 4.3 (h) and 16.3 are quoted herein under:

Clause 4.3 (h) Undertaking that the bidder will be able to invest a minimum cash upto 25% of contract value of work, during implementation or work.

Clause 16.3 Any bid not accompanied by an acceptable Bid Security and not secured

as indicated in Sub-Clauses 16.1 and 16.2 above shall be rejected by the Employer as non- responsive.

12. Clause 4.3 (h) of the Standard Bidding Document specifies an undertaking that the bidder will be able to invest a minimum cash upto 25% of the Contract Value of Work. The undertaking given by the petitioner is contrary to Clause 4.3 (h) of the Standard Bidding Document which would be apparent from the undertaking itself and which reads as follows:

M/S SHALIGRAM SINGH Govt. Contractor SHRI MAHABIR BHAWAN, SURESH COLONY, PS-SADAR, HAZARIBAGH-825301 Ref. No. ........................... Date : 09.09.2023

UNDERTAKING I, the undersigned do hereby undertake that out firm SHALIGRAM SINGH would invest minimum cash up to 10% of the value of the work during implementation of the contract.

M/S SHALIGRAM SINGH

[ Proprietor

13. The Bank Certificate which was to be furnished in terms of the sample format should be the following:

SAMPLE FORMAT FOR EVIDENCE OF ACCESS TO OR AVAILABILITY OF CREDIT FACILITIES (Clause 4.2 (i) OF ITB) BANK CERTIFICATE This is to certify that M/s. ______________ is a reputed Company with a good financial standing. If the contract for the work, namely _________________ is awarded to the above firm, we shall be able to provide overdraft/credit facilities to the extent of Rs. _________ to meet their working capital requirements for executing the above contract during the contact period.

_____________________ (Signature) Name of Bank Senior Bank Manager Address of the Bank

14. The Bank Certificate furnished by the petitioner apart from wrong mentioning of the work for which the said certificate was submitted also did not mention "during the contract period" and, therefore, the same was contrary to the mandatory requirements.

15. Even the Bank Guarantee which was submitted by the petitioner did not confirm to the specifications as it does not contain Clause (c) as given in the format and Clause a (A) is also erroneous.

16. It would thus be abundantly clear that the specifications set forth in the Standard Bidding Document were not fully met by the petitioner as would be evident from what we have discussed above. Issuance of a Corrigendum on 25.10.2023 was basically correcting the Clauses of the Standard Bidding Document which were invoked earlier and such corrigendum would not be an aberration in the decision making process.

17. In the background facts of the case and the inadequacies in the submission of the documents being stark, we may now refer to the case of "M/s. N.G. Projects Limited versus M/s. Vinod Kumar Jain & Others" reported in (2022) 6 SCC 127, on the question of judicial review and it has been held as follows:

"23. In view of the above judgments of this Court, the writ court should refrain itself from imposing its decision over the decision of the employer as to whether or not to accept the bid of a tenderer. The Court does not have the expertise to examine the terms and conditions of the present day economic activities of the State and this limitation should be kept in view. Courts should be even more reluctant in interfering with contracts involving technical issues as there is a requirement of the necessary expertise to adjudicate upon such issues. The approach of the Court should be not to find fault with magnifying glass in its hands,

rather the Court should examine as to whether the decision-making process is after complying with the procedure contemplated by the tender conditions. If the Court finds that there is total arbitrariness or that the tender has been granted in a mala fide manner, still the Court should refrain from interfering in the grant of tender but instead relegate the parties to seek damages for the wrongful exclusion rather than to injunct the execution of the contract. The injunction or interference in the tender leads to additional costs on the State and is also against public interest. Therefore, the State and its citizens suffer twice, firstly by paying escalation costs and secondly, by being deprived of the infrastructure for which the present day Governments are expected to work."

18. In the case of "National High Speed Rail Corporation Limited versus Montecarlo Limited & Anr." reported in (2022) 6 SCC 401, it has been held as follows:

"34. Even otherwise it is required to be noted that once a conscious decision was taken by JICC and JICA, who can be said to be the author of the terms and conditions of the tender document, taking a view and stand that the bid submitted by the original writ petitioner suffers from material deviation and the said decision was taken after considering the relevant clauses of ITB, thereafter it was not open for the High Court to interfere with such a conscious decision in exercise of powers under Article 226 of the Constitution of India and take a view that the bid submitted by the original writ petitioner was in substantial compliance.

35. As observed hereinabove, there are as such no allegations of mala fides and/or favouritism at all. Therefore, the High Court has erred in holding that the bid submitted by the original writ petitioner was in substantial compliance. Whether the bid submitted by a bidder suffers from any material deviation and/or any substantial deviation should be left to the author of the bid document and normally, the High Courts, in exercise of the powers under

Article 226 of the Constitution of India, should not interfere with the same unless such a decision is found to be mala fide and/or there are allegations of favouritism and/or such a decision is arbitrary."

19. The scope of judicial review of a decision making process is very limited and can only be invoked when in such process arbitrariness, unfairness and mala fide are glaring. As we have noticed above, it was the petitioner whose documents which were submitted did not meet the specifications and it was rightly declared as non-responsive. Such action on the part of the State-respondents do not call into question the decision making process which strictly adhered to the conditions demarcated in the Standard Bidding Document.

20. We, therefore, in view of the discussions made above, do not find illegality in the impugned orders and, consequently, this writ application is dismissed.

21. Pending I.A(s), if any, are closed.

(Rongon Mukhopadhyay, J.)

(Deepak Roshan, J.)

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