Madras High Court
New No.4/1 vs Tamil Nadu Electricity ... on 8 March, 2021
W.A.No.762 of 2021
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 08.03.2021
CORAM :
THE HON'BLE MR.SANJIB BANERJEE, CHIEF JUSTICE
AND
THE HON'BLE MR.JUSTICE SENTHILKUMAR RAMAMOORTHY
W.A.No.762 of 2021
Ind-Vigo Coal Pvt. Ltd.,
rep. by its Authorized Signatory
S.Thirumalaisamy,
4-106-B, CGE Colony, 3rd Street
(Near Thiraviyam Ortho Hospital)
Tuticorin – 628 002.
Also at
New No.4/1, Old No.23/1, 1st Floor,
Kanniappa Nagar, 86th Street,
Ashok Nagar, Chennai – 600 083. ... Appellant
Vs.
Tamil Nadu Electricity Generation and
Distribution Company Limited (TANGEDCO),
rep. by its Chairman,
NPKRR Maaligai, 144, Anna Salai,
Chennai – 600 002. ... Respondent
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Prayer: Appeal filed under Clause 15 of the Letters Patent against the
order dated 24.02.2021 passed in W.P.No.4357 of 2021.
For Appellant : Mr.Sathish Parasaran
Senior Counsel
for Mr.R.Parthasarathy
For Respondent : Mr.Vijay Narayan
Advocate-General
assisted by
Mr.Krishna Pradeep
JUDGMENT
(Delivered by The Hon'ble Chief Justice)
The appeal is directed against an order of February 24, 2021,
by which the appellant's writ petition challenging a tender process
initiated by respondent TANGEDCO has been dismissed.
2. The appellant had questioned the tender process initiated by
an advertisement published on January 18, 2021 for supply of 20 lakh
tonnes of imported coal having a particular calorific value during the
period May, 2021 to May, 2022. The last date for submission of the
offers was February 23, 2021. Only on-line bids were to be made till
2 pm on such day and the e-reverse auction method was to be
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followed.
3. According to the appellant, the tender documents were in
derogation of the Tamil Nadu Transparency in Tenders Act, 1998 and
the Rules of 2000 framed thereunder. The appellant complains that
the tender papers would reveal that TANGEDCO had deliberately
excluded any Indian party from participating in the process.
According to the appellant, even consortia could not participate as
would be evident from the nature of the documents demanded.
4. The principal grounds urged by the appellant are the
violation of Section 9(3) of the said Act of 1998, inasmuch as the
notice inviting tender was not published in the Indian Trade Journal
and that prior approval of the bid had not been obtained though the
bid involved an amount well in excess over the threshold limit
requiring such prior approval. The appellant insists that in terms of
Section 4 of the Act of 1998, no offer could have been invited and
none accepted except in accordance with the procedure specified in
the said Act and the Rules made thereunder. Once it was
demonstrated before the Writ Court that some provisions of the Act
and the Rules had not been complied with, the Writ Court had no
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W.A.No.762 of 2021
alternative but to quash the tender process upon annulling the same.
5. In addition, the appellant questions the propriety of the
Indian suppliers being excluded. The appellant says that all that the
respondent required was coal of a particular grade and it did not
involve either rocket science or any involved technology for effecting
supply of such grade of coal as specified in the tender documents.
6. By the judgment and order impugned dated February 24,
2021, the last date for the submission of tender has been extended
by permitting the respondent to obtain the approval and to publish
the notice inviting tender in the Indian Trade Journal. However,
again, the appellant has a grievance in such regard as the appellant
claims that the period of publication in the Indian Trade Journal
should be thirty days prior to the time for receipt of the offers and
the thirty-day period in this case has not been complied with. The
appellant also submits that this was a matter which ought to have
been planned well in advance and it will not do for the respondent to
seek an exemption and abridge the time for publication or obtain ex-
post facto approval.
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W.A.No.762 of 2021
7. On behalf of TANGEDCO, it is submitted that while the
planning on TANGEDCO's part should have been better and all loose
ends tied up before the publication was made, it is once again the
pandemic and the lockdown which is used as a magic wand to ward
off all objections. The excuse proffered in this case is that following
the lockdown in the wake of the pandemic and the closure of several
industries, TANGEDCO did not anticipate that upon the economy re-
starting, there would be such an increased demand that the reserve
quantities of coal may not be adequate to tide over even the summer.
TANGEDCO says that it has adequate coal supply to last it till the end
of April or the beginning of May, but it needs a kind of a buffer of a
few days and in terms of the tender documents, the prospective
supplier would need sufficient time to effect the supply. Whether or
not the limited supply argument is made to persuade the Court to
overlook the shortcomings on the part of TANGEDCO or there is any
basis to the claim of increased demand in recent times, cannot be
ascertained immediately.
8. However, the other grounds urged on behalf of TANGEDCO
stand to reason. For one, TANGEDCO says that the appellant herein
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has no business to interfere with the process since the appellant does
not meet even one of the three essential eligibility criteria set down
in the tender papers. According to such conditions, a prospective
bidder should have supplied five lakh tonnes of coal in a year within
the last few years to any one entity; it should have had a turnover in
excess of Rs.335 crore in one of the last three financial years; and, it
ought to have a tie-up with a coal producing mine. TANGEDCO
claims that despite its challenge, the appellant did not produce any
document to suggest that it qualified under even one of the three
heads.
9. As to the contention of the appellant that Indian suppliers
appear to have been excluded, TANGEDCO says that suppliers of
Indian origin have not been excluded, but certain conditions have
been imposed which all enure to the benefit of TANGEDCO and for a
simpler process of identifying the genuineness and capability of the
supplier. TANGEDCO says that it needs the specified calorific value of
coal to mix the same with Indian grade coal obtained by it on an
annual basis from Coal India or its subsidiaries for the purpose of
generating electricity at the several thermal units in the State.
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W.A.No.762 of 2021
TANGEDCO adds that while it is open to any person qualifying to
participate in the tender process to make a bid, usually the coal of
Indonesian origin has been found to be the best for the purpose of
completely answering to the calorific content as sought by
TANGEDCO.
10. TANGEDCO confirms that it has obtained ex-post facto
approval of its notice inviting tender since the value of the quantum
of goods to be supplied thereunder exceeds Rs.75 crore. TANGEDCO
also confirms that the publication of the notice inviting tender has
been made in the Indian Trade Journal. In such regard, TANGEDCO
refers to sub-rule (2) of Rule 20 of the said Rules to contend that in
case of an urgent requirement, the time provided under the Rules
may be abridged.
11. In the tender papers, export licenses have been sought
from the bidders and the supplies are required to be effected through
bills of lading where TANGEDCO would be the consignee. In response
to the appellant's assertion that these are all ruses to keep the Indian
participants at bay, TANGEDCO claims that previous experiences in
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such regard reveal the submission of manufactured or fabricated
documents to establish the eligibility criteria without the supplier
having the capability to effect such a large supply. TANGEDCO
points out that the supply in this case is of 20 lakh tonnes over a year
and it is only entities which have direct tie-ups with foreign coal
mines or the like which may be in a position to effect the regular and
uninterrupted supply during such period. In other words, TANGEDCO
suggests that parties which deal in trading may not be ideal to award
such a contract to as such parties may not be able to ensure
uninterrupted supply. Any disruption in supply, TANGEDCO is quick
to point out, may result in electricity not being generated at the
thermal units for want of the appropriate quality and quantity of coal.
12. The Writ Court addressed the two principal grounds urged
by the appellant herein by requiring TANGEDCO to obtain an approval
and publish the notice inviting tender in the Indian Trade Journal
upon extending the deadline for receiving the bids.
13. TANGEDCO claims to have complied with the directions in
such regard. In addition, it must not be lost sight of that the writ
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petition has not been filed in public interest. Even if the reliefs were
to be granted, the appellant would not be eligible to participate in the
bidding process since the appellant does not appear to possess any of
the three essential qualifications as stipulated.
14. For the reasons aforesaid, the judgment and order
impugned dated February 24, 2021 do not call for any interference,
particularly at the behest of the present appellant. The deadline for
receiving the bids has been extended to March 10, 2021.
15. W.A.No.762 of 2021 is dismissed. There will, however, be
no order as to costs. Consequently, C.M.P.Nos.4076 and 4078 of
2021 are closed.
(S.B., CJ.) (S.K.R., J.)
08.03.2021
Index : No
bbr
To
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W.A.No.762 of 2021
The Chairman,
Tamil Nadu Electricity Generation and
Distribution Company Limited (TANGEDCO),
NPKRR Maaligai, 144, Anna Salai,
Chennai – 600 002.
THE HON'BLE CHIEF JUSTICE
AND
SENTHILKUMAR RAMAMOORTHY, J.
bbr
W.A.No.762 of 2021
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