M/S Bvg India Bvg House Premier ... vs The State Of Madhya Pradesh
2021 Latest Caselaw 464 MP

                                1


            The High Court Of Madhya Pradesh

                  Writ Petition No.4923/2021

                      M/S BVG India Limited
                               Vs
                  The State of M.P. & Others

Present: Hon'ble Shri Mohammad Rafiq,Chief Justice
            Hon'ble Shri Justice Vijay Kumar Shukla,
            Judge.



     Shri   Kishore    Shrivastava,    learned      Senior   Counsel

assisted by Shri Kunal Thakre, Counsel for the petitioner.

     Shri A. A. Bernard, learned Deputy Advocate General for

the respondents/ State.



Whether approved for
reporting ?
Law laid down                     State has administrative discretion
                                 to cancel entire tender process in
                                 public interest provided such
                                 action is not actuated with ulterior
                                 motive, arbitrariness, irrationality
                                 or is in violation of some statutory
                                 provisions. However, in the facts
                                 of the present case, the petitioner
                                 could      not      establish   any
                                 arbitrariness on the part of the
                                 respondents in finalizing the bid of
                                 the respondents.
Significant paragraph Nos.          Para No.   12
                           O R D E R

( JABALPUR DATED .....-03-2021 )

Per: Shri Vijay Kumar Shukla, J.

The present petition has been filed under Article 226 of the

Constitution of India seeking quashment of the NIT (bid) open

tender process with regard to Revised 3 rd Call in relation to State

Level Centralized Call Centre/ Dial-100 Project Phase -II (2020-

2025) "On Turn-Key Basis" and to direct the respondents-State to

initiate the fresh tender process.

2. The petitioner is an existing Contractor performing the

tender work. On 9.12.2020 the respondents have invited Tender

(NIT). The last date for submission of NIT/ Tender was 24.12.2020.

It is alleged that the petitioner was restrained forcefully by using

Government Agency i.e. GST who has made raid and sealed the

office of the petitioner. On earlier two occasions two times

advertisements were issued but no party has participated on

account of harsh payment terms, as such 3 rd Revised Call was

made. It is further submitted that the respondents finalized the

technical bid by exercising colorable powers on 2.2.2021.

According to the petitioner, the petitioner's firm is having large

infra-structure and performing various contracts works in all over

the country. The petitioner is presently carrying out work of Dial-

100 in the State of Jammu and Kashmir and Maharashtra.

3. In the year 2014-15, the State Government has invited

open NIT for State Level Centralized Call Center / Dial-100. In

pursuance to the said open NIT, the petitioner's firm did participate

in open NIT process. The NIT was finalized in favour of the

petitioner and the work order was issued on 2.5.2015 for five years

i.e. from 1st April, 2015 to 31st March, 2020 and the petitioner's firm

entered into an agreement. As per the term of contract the period

of 5 years expired on 31 st March, 2020. Thereafter, the State

Government has extended the period by issuing First Extension

order dated 18.2.2020, whereby the period was extended for

another six months upto 30th September, 2020. The State

Government has again extended the term of contract vide order

dated 1.10.2020 for another six months i.e. from 1.10.2020 to 31 st

March, 2021. Now the extended period of contract is expiring on

31st March, 2021. The State has issued First NIT on 18 th March,

2020 for State Level Centralized Call Center/ Dial-100 Project

Phase II (2020-2025) "On Turn-Key Basis" for fresh grant of

contract. According to the petitioner various objections were

raised in respect of certain conditions and therefore no one

participated in the process for awarding of NIT. Thereafter, the

State Government issued a Second Call on 28.10.2020 with

modified conditions but still no one participated in the Second Call

also. Thereafter, the State issued revised 3 rd Call e-Tender (NIT)

document on 9.12.2020 for State Level Centralized Call Center/

Dial-100 Project Phase-II (2020-2025) "On Turn Key Basis", by

relaxing certain conditions of the first and second call. On-line bid

submission date commenced from 9.12.2020 upto 18 hrs. and the

last date of submission of on-line bid was 24.12.2020, upto 1800

PM. The date of opening of Bid was 26.12.2020 at 12:30 hrs.

4. In the Tender there is a requirement to deposit Earnest

Money Deposit (EMD) in the form of Bank Guarantee to the tune of

Rs.2.50 Crores. According to the petitioner, the petitioner stared

preparing for submission of the bid in right earnest and in

pursuance thereof got prepared a Bank Guarantee of Rs.2.50

Crores on 22.12.2020. It is asseverated that the petitioner's

Company was making preparation for submission of the price bid

on 24.12.2020 but the office of the Commercial Tax M.P.

conducted a raid with respect to Goods and Service Tax (GST) on

the very date and time for last date for submission of the

document. The said raid continued in the office of the petitioner

upto 20.00 hrs and thereafter the office was sealed. Due to the

above the petitioner's Company was precluded from submitting its

bid for the tender in question. It is stated that in the tender

process only two firms participated at 11 hrs. i.e. Respondent No.4

who submitted its bid at 05:45 PM and another firm GVK

Management & Research Institute at 05:28 PM on 24.12.2020. The

petitioner submitted that from the above facts it is clear that the

bidders waited till it was ensured that the petitioner was not in a

position to submit its bid and thereafter submitted its bid which

later turned out to be lowest.

5. It is alleged by the petitioner that the petitioner is presently

working at a rate which comes to rupees 405 Crore annually for

five years, whereas the respondent No.4 has submitted bid to the

tune of Rs.642 Crore annual for five years with a clause for

increase every year depending upon inflation. This shows that

huge price difference between the rates of the existing contractor

and the rates quoted by the Respondent No.4. The technical bids

of both the participants was evaluated after opening of price bids

on 2.2.2021. The technical bids of both the bidders were held to

be qualified. The petitioner raised its grievance on various forums

but no action has been taken despite the reminder submitted by

the petitioner on 21.2.2021.

6. The submission of learned counsel for the petitioner is that

the respondents have carried out the entire exercise in arbitrary

exercise of powers which suffers from outcome of malice and

entire process deserves to be set aside. The petitioner's firm who

is one of the strongest competitor to participate in the 3 rd Revised

Call was forcefully restrained by GST Team from participating in the

Tender process.

7. Counsel for the petitioner submitted that in the facts of the

present case and taking into consideration the vast difference of

the rates on which the petitioner was earlier working and the rates

which has been submitted by the respondent No.4, the

proceedings of the tender in pursuance to the impugned revised

3rd Call in relation to State Level Centralized Call Center/ Dial-100

Project Phase-II (2020-2025) "On Turn Key Basis" deserves to be

quashed and the respondents be directed to initiate fresh tender

process.

8. In support of his submissions, the learned counsel for the

petitioner placed reliance on the following judgments : (2010)6

SCC 303 - Shimnit Utsch India Pvt. Ltd. & Anr. Vs. West

Bengal Transport Infrastructure Development Corporation

Ltd. & Ors.; (2014)11 SCC 192 :: AIR 2014 SC 2307 - State

of Assam & Ors. Vs. Susrita Holding Pvt. Ltd.; (2015)13

SCC 233:: AIR 2014 SC 3358 - Rishi Kiran Logistics Pvt. Ltd.

Vs. Board of Trustees of Kandla Port Trust & Ors.; (1994)6

SCC 651 - Tata Cellular Vs. Union of India and (2000)5 SCC

287 - Monarch Infrastructure (P) Ltd. Vs. Commissioner,

Ulhasnagar Municipal Corporation & Ors.

9. Learned counsel for the respondents / State submits that there

is no arbitrariness on the part of the respondents in taking decision to

finalize the tender of respondent No.4. The petitioner could not

establish any malafide or arbitrariness in the action of the respondents.

It is further submitted that the petitioner was never interested in the

tender process. On-line bid submission date commenced from

9.12.2020 but the petitioner got prepared the bank guarantee on

22.12.2020 just before the last date of submission of bid i.e. 24.12.2020.

Further, there is no merit in the contention of the learned counsel for the

petitioner that the petitioner firm was precluded from participating in the

tender because of the action of the respondents. The action of raid was

conducted by the Commercial Tax Department whereas, the tender was

issued and finalized by the different department and different authorities

i.e. Police Department.

10. We have heard learned counsel for the parties and bestowed

our anxious consideration to the submissions made by the learned

counsel for the parties. We do not find any merit in the petition.

As per the term of the contract of the petitioner, the period of five

years expired on 31st March, 2020. Thereafter, the State

Government has extended the period by issuing first extension

order dated 18.2.2020 whereas, the period was extended for

another six months upto 31st September 2020. the State

Government has extended the term of the contract vide order

dated 1.10.2020 for another six months i.e. from 1.10.2020 to 31 st

March, 2020. The period of contract is to expire on 1 st March,

2020. In the meantime, the respondents have issued first NIT on

18th March, 2020 for State Level Centralized Call Center/ Dial-100

Project Phase-II (2020-2025) "On Turn Key Basis" for fresh grant of

contract but since no one participated, the same could not be

materialized. Thereafter, another second call NIT was issued on

28.10.2020 with certain modified conditions but still no one

participated in the same also. Thereafter, the respondents have

issued 3rd Call e-Tender on 9.12.2020 by relaxing certain conditions

of the 1st and 2nd Call. The on-line bid submission commenced

from 9.12.2020 upto 18 hours and the last date of submission on-

line was 24.12.2020 and the date of opening of the bid was

26.12.2020 at 12.30 hrs. The petitioner has sufficient time for

making preparation for submission of the bid from 9.12.2020 till

the last date i.e. 24.12.2020 but he opted to wait till 22 nd

December, 2020 to prepare the bank guarantee of Rs.2.50 Crore to

participate in the bid. On the last date a raid was conducted by

the Commercial Tax, M.P. If the petitioner would have been

interested to participate, he could have prepared the bank

guarantee well in advance and could have submitted the bid much

before the last date i.e. 26.12.2020. The two other tenderers

submitted their bid on the last date, would not mean that it was

compulsorily necessary for all the bidders to submit their bid on

the last date of submission of bid. Even otherwise, for the same

the respondents cannot be blamed that because of their action the

petitioner was precluded from participating in the 3rd revised call.

11. The respondents have duly considered the two eligible

tenderers who had submitted their bid well in time before last date

of submission of the bid. There is no element of pick and choose

as due process of tender was followed by the respondents.

12. The petitioner has relied upon the judgments passed by the

Supreme Court in the case of Shimnit Utsch India Pvt. Ltd.

(supra), wherein it has been held that State has administrative

discretion to cancel entire tender process in public interest

provided such action is not actuated with ulterior motive,

arbitrariness, irrationality or is in violation of some statutory

provisions. In the facts of the present case, there is no

arbitrariness on the part of the respondents in finalizing the

selection of respondent No.4, especially when the petitioner had

not submitted any bid before the cut-off date. Since the petitioner

has not participated, therefore, his argument that the respondents

could have fatched better price has no merit. The petitioner got

advantage of already extended one year in two phases of six

months for one or another reason. In the 3 rd Call e-tender NIT the

process commenced from 9.12.2020 and the petitioner got

prepared the bank guarantee on 22nd December 2020 just few days

before the last date. The respondents cannot be held responsible

for the raid conducted by the Commercial Tax, M.P. under GST.

13. The judgment in the case of Susrita Holding Pvt. Ltd.

(supra) the Apex Court held that "the sale may be either by public

auction or private contract. In either case the trustee has to keep

in mind that he must obtain the most advantageous price." In the

facts of the said case the tender process was set aside and

directions were issued for fresh tender but in the facts of the

present case nothing has been brought by the petitioner to show in

what manner the respondents have acted arbitrarily in finalizing

the tender of the respondent No.4.

14. In the case of Rishi Kiran Logistics Pvt. Ltd. (supra) it has

been held that the respondents had a right to cancel the process

which had not resulted in a concluded contract. The aforesaid

judgment would not render any assistance in the facts of the

present case.

15. In the case of Tata Cellular (supra) it has been held that

Government is the guardian of the finances of the State. It is

expected to protect the financial interest of the State. The right to

refuse the lowest or any other tender is always available to the

Government. The same law has been reiterated in the case of

Monarch Infrastruction (P) Ltd. (supra) that Government

cannot arbitrarily choose any person it likes for entering into such

a relationship or to discriminate between persons similarly situate.

It is open to the government to reject even the highest bid at a

tender where such rejection is not arbitrary or unreasonable or

such rejection is in public interest for valid and good reasons.

16. In the present case the petitioner has failed to point out any

arbitrariness on the part of the respondents in selection of

respondent No.4. The petitioner has to blame himself for not

participating in the tender process.

17. In view of the aforesaid, we do not find any illegality or

arbitrariness in decision making process of the respondents in

finalizing the bid of the respondent No.4, especially when the

petitioner himself has not participated in the tender process.

18. Accordingly, the writ petition is dismissed.

               (MOHAMMAD RAFIQ)             (VIJAY KUMAR SHUKLA)
                  CHIEF JUSTICE                    JUDGE


Mrs.mishra