Madras High Court
Kandasami vs The Commissioner Of Rural ... on 9 June, 2023
W.P(MD)No.13511 of 2023
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED : 09.06.2023
CORAM
THE HONOURABLE MR.JUSTICE C.V.KARTHIKEYAN
W.P(MD).No.13511 of 2023
and
W.M.P(MD)Nos.11411 and 11413 of 2023
Kandasami ... Petitioner
Vs
1. The Commissioner of Rural Development
and Panchayat Raj Department,
Panagal Building, Chennai - 600 015.
2. The District Collector /
The Chairman of District Rural Development Agency (DRDA),
Sivagangai District,
Sivagangai.
3. The Project Director,
District Rural Development Agency,
Sivagangai, Sivagangai District.
4. The Executive Engineer,
District Rural Development Agency,
Sivagangai, Sivagangai District.
... Respondents
1/14
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W.P(MD)No.13511 of 2023
Prayer : Writ Petition filed under Article 226 of the Constitution of India,
praying this Court to issue a Writ of Certiorarified Mandamus, calling for the
records relating to the Tender Rejection Order dated 04.06.2023 on the file of
the second respondent and quash the same for Strengthening of Kalla
Mathagupatti Road to Kalavananthal (via) Poyyamanipatti road at Package
No.MGSMT SVG DT KKOIL_Pack_ 101 at Sivagangai District and to direct
the respondents to open the price bid and award the said contract work to the
petitioner.
For Petitioner : Mr. V.Kannan
For Respondents: Mr.V.Veera Kathiravan
Additional Advocate General
assisted by Mr.J.Ashok
Additional Government Pleader
*****
ORDER
The writ petition has been filed in the nature of a Mandamus, seeking
records relating to tender rejection order, dated 04.06.2023 on the file of
second respondent/District Collector/Chairman of District Rural Development
Agency (DRDA) Sivagangai District and to quash the same and to direct the
second respondent to open the price bid and award the said contract work to
the petitioner herein.
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W.P(MD)No.13511 of 2023
2.The petitioner had participated in a tender floated by the respondent
for Strengthening of Kalla Mathagupatti Road to Kalavananthal (via)
Poyyamanipatti road at Package No.MGSMT SVG DT KKOIL_Pack_ 101 at
Sivagangai District.
3.The petitioner is a Class I Contractor duly recognised and also
registered with GST Authority and issued with GST Registration Certificate.
The second respondent had issued a tender notice calling for tenders carrying
out works strengthening of roads under the Tamil Nadu Rural Road
Improvement Scheme 2022-23.
4.The petitioner had participated in the tender. The last date for
submission of tender was 19.05.2023 at 3.00 PM. The online opening of
tender was to be conducted on 19.05.2023 at about 4.00 PM. The entire
process was through e-tender. The petitioner had claimed that he uploaded all
the supporting documents and also paid EMD for the specified amount.
5.The petitioner had participated in the tender along with three other
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W.P(MD)No.13511 of 2023
tenderers. It is claimed by the learned counsel for the petitioner that the
tender documents were not opened on 19.05.2023 at 4.00 PM as scheduled.
Rather, the respondents awaited for 15 days and thereafter, the impugned
notice had been issued. In the impugned notice, the bid offered by the other
tenderers had been rejected, for the reason stated therein. The bid offered by
the petitioner alone could be then considered. The bid offered by the
petitioner was also rejected, on the ground that it was the only bid and
considered as a single bid, therefore, it was contended the said bid shall not be
opened. Questioning that reason for rejection of tender, the present writ
petition has been filed.
6.The learned Counsel for the petitioner stated that the respondents had
deliberately rejected the bids offered by other participants, only with a view to
reject the bid of the petitioner herein. It was also claimed that the bid was not
opened on the stipulated date and time, namely 19.05.2023 at 4.00 PM and
after 15 days the documents were opened in the absence of the petitioner. It
was therefore contended that the respondents had ensured that there was no
effective competition among the participants and holding that the bid
submitted by the petitioner was a single bid, it was rejected. Claiming mala
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W.P(MD)No.13511 of 2023
fide on the part of respondents, this writ petition has been filed.
7.The learned Additional Advocate General however asserted that the
petitioner had formed a cartel with the other participants. The other
participants had not challenged the reasons for rejection of their bid, thereby
leaving the petitioner’s bid alone for consideration. It was contended that it
was not an open and fair competition and therefore, the single bid of the
petitioner was rejected by the respondents.
8.The same allegations have been alleged stated by the petitioner
against the respondent and also by the respondents against the petitioner. The
petitioner claims that the other participants had been deliberately rejected by
the respondents, whereas, the respondents contend that the other participants
were cartel members of the petitioner, since they had not questioned the
reasons for the rejection of their bid.
9.It is seen from the grounds of rejection, quite apart from stating that
documents were not submitted, the original draft was not submitted was also
quoted. However, the EMD is paid in the form of Demand Draft, which
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W.P(MD)No.13511 of 2023
automatically means that cash had been paid and the Demand Draft was
purchased. It is strange that the other tenderers had not questioned that ground
for their rejection. Whether the other participants were cartel members of the
petitioner as claimed by the respondents or genuine participants as claimed by
the petitioner need not be discussed here. What remains is that the bid of the
petitioner was rejected.
10.There cannot around that cannot be any evolution of the final offer
made by the petitioner, since there was no comparable value. It is for that
reason, the bid offered by the petitioner was rejected.
11.In this connection, the learned Additional Advocate General placed
reliance on the guidelines issued by the Central Government in the National
Rural Roads Development Agency, Ministry of Rural Roads Development,
Government of India in No.P-17025/33/2011/P-1/RC, dated 15.01.2013. This
is a circular issued by Central Government and these guidelines have been
directed to be followed by the State Agencies also. The guidelines had been
called Pradhan Mantri Gram Sadak Yojana (PMGSY). The procedure for
tender had been examined and the guidelines of CVC and the Committee had
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W.P(MD)No.13511 of 2023
also been examined. They provide that a single tender can be accepted only
by recording detailed justification, in support of acceptance with the approval
of competitive authority.
12.In this case, there is no justification in seeking a direction to open
the bid of the petitioner alone, since it would not provide a fair value. The
object is transparency in the tender system.
13.In the said guideline with respect to determination of a single tender
and with respect to opening of single bid tendered, it had been provided as
follows:
“A.Definition of Single Tender: If, consequent to invitation of
tenders/bids for any package, only one bid/tender is received or
consequent to technical evaluation if only one bid/tender is found
eligible, such bids/tenders shall be termed as single tenders for
the purposes of PMGSY.
B.Opening of Single Bids/Tenders: If in the first
invitation/call, single bid is received, the State Rural Roads
Development Agency (SRRDA) or authority inviting the tenders/bids
shall not open the bid. In such cases the bids shall be re-invited.
Modification in the e-procurement software shall be made by the
NIC to delete the bid (while maintaining the data in the data base)
from the server after the date of opening of bids and generate
appropriate reports in this regard.”
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W.P(MD)No.13511 of 2023
14.It had also been provided that subsequent to invitation of bids, the
agencies are free to re-package the works or revise the estimate cost. Thus, as
a concept, opening of a single tender was frowned upon by the Central
Government.
15.This concept had been further examined by a Division Bench of this
Court in (1999) 3 MLJ 274 [R.J.Veeraraghavan vs The Tamil Nadu Slum
Clearance Board, represented by its Chairman, Chennai], wherein, the
Division Bench had stated as follows in paragraph No.53.
“53. With regard to other two writ appeals in W.A.Nos. 1694
and 1695 of 1998, petitioner's tender was not accepted for the
reason that the Board have taken policy decision not to accept the
single tender. It is an admitted fact that three persons purchased
the tender forms and appellant alone submitted the tender.
Respondents bona fide believed that the other two persons might
have colluded with petitioner and have withdrawn from the
competition. For the best interest of respondents and for getting
better competitive relates without any deterioration in the quality
of work, if respondents have taken policy decision, not to accept
the single tender, same cannot be said as mala fide.”
16.The Division Bench had clearly stated that a single tender system
cannot be opened after the other tenders have been rejected. The rejection of
the single tender cannot be said to be mala fide.
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17.In this case, the respondents allege that all the participants had
formed a cartel with the petitioner, whereas, it is alleged by the petitioner that
other participants are the agents of the respondents. Either way, the bid of the
petitioner alone cannot be opened and I hold was correctly rejected.
18.The learned Additional Advocate General also pointed out the
narrow scope of interference in tender issues while exercising discretion
under Article 226 of Constitution of India.
19.In (2022) 6 SCC 127 [N.G.Products Limited Vs Vinod Kumar Jain
and others], where, the relief of a rejected tenderer was examined, the
Hon’ble Supreme Court had held as follows:
“21. Since the construction of road is an infrastructure
project and keeping in view the intent of the legislature that
infrastructure projects should not be stayed, the High Court would
have been well advised to hold its hand to stay the construction of
the infrastructure project. Such provision should be kept in view
even by the Writ Court while exercising its jurisdiction
under Article 226 of the Constitution of India.
22. ….
23. In view of the above judgments of this Court, the Writ
Court should re-frain 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
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W.P(MD)No.13511 of 2023
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 ex-
pertise 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 malafide 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.”
20.In Uflex Limited Vs Government of Tamil Nadu and Others, in
Civil Appeal No.4862-4863 of 2021, dated 17.09.2021, which was filed by
State of Tamil Nadu against the Judgment of a Division Bench of this Court,
the Hon’ble Supreme Court had frowned upon the Division Bench in an issue
relating to tender adjudication in favour of rival tenders. The observation of
the Hon’ble Supreme Court as follows:
“42. We must begin by noticing that we are examining the case,
as already stated above, on the parameters discussed at the inception.
In commercial tender matters there is obviously an aspect of
commercial competitiveness. For every succeeding party who gets a
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W.P(MD)No.13511 of 2023
tender there may be a couple or more parties who are not awarded the
tender as there can be only one L-1. The question is should the judicial
process be resorted to for downplaying the freedom which a tendering
party has, merely because it is a State or a public authority, making
the said process even more cumbersome…. The objective is not to
make the Court an appellate authority for scrutinizing as to whom the
tender should be awarded. Economics must be permitted to play its
role for which the tendering authority knows best as to what is suited
in terms of technology and price for them.”
21.The learned counsel for the petitioner drew the attention of this
Court to Section 8 of the Tamil Nadu Transparency in Tenders Act relating to
opening of tender. Section 8 of the Act is as follows.
“8. Opening of Tender.- The Tender Accepting Authority or
any other officer authorised by it, shall open the tenders in the
presence of tenderers present and who have submitted tenders in
such time and in such place as may be specified in the tender
document.”
22.If according to the learned counsel for the petitioner, there is a
violation of this particular provision, then that is a ground to reject the entire
process and to direct the respondents to re-issue and call again for fresh
tenders.
23.The learned counsel for the petitioner also placed reliance on Rule
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W.P(MD)No.13511 of 2023
21(1) of the Tamil Nadu Transparency in Tender Act Rules, 2000. The said
rule is extracted below.
“21. Opening of tenders.- (1) All the tenders received by the
Tender Accepting Authority shall be opened at the time specified in the
Notice Inviting Tenders and in cases where an extension of time for the
submission of tenders has been given subsequent to the original Notice
Inviting Tenders in accordance with sub-rule (5) of Rule 18 at the time so
specified subsequently. 1 “The e-submitted tenders may be permitted to
be opened by a Tender Inviting Authority or a member of the Tender
Scrutiny Committee from their new location if they are transferred after
the issue of Notice Inviting Tender and before tender opening and where
the new incumbent is yet to obtain his digital signature certified.”;
24.Viewed from any angle, either accepting the arguments advanced by
the learned Counsel for the petitioner or the arguments advanced by the
learned Additional Advocate General. I hold that the respondents had
correctly cancelled the entire tender process and had taken a decision to re-
issue the tender.
25.I am informed that a tender notice had been again re-issued. The
petitioner can always participate in the said process. He can also ensure that
the other participants are not those, whom the respondents would categorise
as members of his cartel.
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W.P(MD)No.13511 of 2023
26.Reference was made to Section 11 of the Act. That issue is left open,
since it is a statutory right of the petitioner and he may take any decision in
this regard. This Court cannot interfere in that process.
27.In view of the above reasons, this writ petition stands dismissed.
Consequently, connected miscellaneous petitions are closed.
09.06.2023
NCS : Yes/No (4/5)
Index : Yes / No
Internet: Yes/ No
PNM
To
1. The Commissioner of Rural Development
and Panchayat Raj Department,
Panagal Building, Chennai - 600 015.
2. The District Collector /
The Chairman of District Rural Development Agency (DRDA),
Sivagangai District,
Sivagangai.
3. The Project Director,
District Rural Development Agency,
Sivagangai, Sivagangai District.
4. The Executive Engineer,
District Rural Development Agency,
Sivagangai, Sivagangai District.
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W.P(MD)No.13511 of 2023
C.V.KARTHIKEYAN, J.
PNM
ORDER IN
W.P(MD).No.13511 of 2023
09.06.2023
(4/5)
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