Madras High Court
The Managing Director And Tender ... vs M/S.Xo Footwear Pvt on 19 August, 2024
Author: S.M.Subramaniam
Bench: S.M.Subramaniam
2024:MHC:3103
W.A.No.1337 of 2022
IN THE HIGH COURT OF JUDICATURE AT MADRAS
RESERVED ON : 01.08.2024
PRONOUNCED ON : 19.08.2024
CORAM
THE HONOURABLE Mr.JUSTICE S.M.SUBRAMANIAM
AND
THE HONOURABLE Mr.JUSTICE C.KUMARAPPAN
W.A.No.1337 of 2022
and
CMP.No.8509 of 2022
The Managing Director and Tender Inviting Authority,
Tamil Nadu Textbook and Educational Services Corporation,
EVK Sampath Maaligai,
D.P.I Campus,
68, College Road,
Chennai-600 006.
... Appellant
Vs.
M/s.XO Footwear Pvt., Ltd.,
Rep. by its Director Mr.Nalin Gupta,
Regd. Off: A-122, Mangolpuri Industrial Area,
Phase-II, New Delhi-110 034.
... Respondent
Prayer: Writ Appeal filed under Clause 15 of Letters Patent praying to set
aside the order dated 21.04.2022 in W.P.No.9046 of 2022.
1/13
https://www.mhc.tn.gov.in/judis
W.A.No.1337 of 2022
For Appellant : Mr.D.Ravichander
For Respondent : Mr.Satish Parasaran
Senior Counsel
for Mr.Ali Hassankhan
*****
JUDGMENT
[Judgment of the Court was made by C.KUMARAPPAN, J.]
“Tamil Nadu Textbook and Educational Services Corporation”
[hereinafter shall be referred to as “Corporation”] has filed the instant writ
appeal aggrieved with the order of the learned Single Judge passed in
WP.No.9046 of 2022 dated 21.04.2022.
2. The short facts which are necessary for the disposal of the present
writ appeal is that, the Corporation has floated tender for the supply of
socks for school children on Annual Rate contract basis for the year 2022-
2023. The said tender notification was advertised on 20.12.2021 informing
the time schedule that, Pre-Bid meeting on 04.01.2022 and the last date for
submission of Tender was on 20.01.2022. It was also mentioned that the
technical bid will also be opened on the same date. However, a
Corrigendum was issued subsequently by extending the tender opening
date.
https://www.mhc.tn.gov.in/judis
3. In the tender form, the Corporation has directed the bidders to
submit a declaration in respect of their status whether they have been
blacklisted or not vide Annexure-VI. For ready reference, Annexure-VI is
extracted hereunder:-
“DECLARATION
I/We ............................ having the registered office at
..................................... hereby declare that the
Firm/Company or its Partners/ Shareholders have not been
blacklisted by Central/any State Government and its Public
Sector Undertakings/Corporations.”
4. However, it appears that the bidder, qua the writ petitioner has not
submitted declaration, and when it came to light to this appellant that the
petitioner was blacklisted in the past, they have called for an explanation
from the petitioner vide impugned notice dated 01.03.2022. In the said
notice, the Corporation has mentioned about the confirmation of debarment
qua blacklisting of the petitioner by the Jharkhand High Court as well as the
Hon'ble Supreme Court of India. Therefore, the Corporation/Appellant has
requested the petitioner to provide their views on the above information.
https://www.mhc.tn.gov.in/judis
5. Immediately, on receipt of such notice, the petitioner sent a reply
on 03.03.2022 denying the statement made in the Corporation notice.
Thereafter, immediately, they filed the impugned writ petition on
07.04.2022, praying for a writ of Mandamus, directing the respondent to
consider the petitioner as qualified in the technical bid and for further
direction to the Corporation to open and consider the financial bid of the
petitioner.
6. The Writ Court, after considering the either side submission though
has not granted any relief in favour of the petitioner, has found that the writ
petition is maintainable against the impugned show cause notice and has
also directed in paragraph 49 of the writ order that whenever any
unsuccessful tenderer raises an objection, the Tender Accepting Authority
has to dispose of those objections as expeditiously as possible, preferably
within 48 hours. Only against these observations, the Corporation has
preferred the instant writ appeal. As a matter of fact, the tender process has
already been completed and awarded to some other bidder.
7. The learned Special Government Pleader would vehemently
contend that the prayer of this petitioner seeking for a Mandamus to
https://www.mhc.tn.gov.in/judis
consider the petitioner as a qualified bidder in a technical bid cannot be
sought for. It is also the submission of the learned Special Government
Pleader that under “The Tamil Nadu Transparency in Tenders Rules, 2000”
[hereinafter shall be referred to as “Tender Transparency Rule”], the Tender
Issuing Authority is competent to seek bona fide clarification from the
bidders under Rule 27(4) of the Tender Transparency Rule. Therefore,
contended that filing of writ petition against the notice seeking bona fide
clarification is not maintainable, and if such writ permitted, then it will
hamper in providing welfare measures to the citizen, and would result in the
danger of price rise. It was also the submission of the learned Special
Government Pleader that time limit given by the learned Single Judge,
directing the Corporation to dispose of the objections within 48 hours is
beyond the scope of the writ petition and contrary to the Rules. Hence, the
learned Special Government Pleader prayed to interfere with the order of
the learned Single Judge.
8. Per contra, the learned Senior Counsel Mr.Satish Parasaran
appearing on behalf of the writ petitioner would vehemently contend that
the writ petition emanated based upon the show cause notice issued by the
Corporation on 01.03.2022, whereby they have attempted to reject the
https://www.mhc.tn.gov.in/judis
petitioner on the ground that the petitioner was blacklisted by the Jharkhand
High Court and Hon'ble Supreme Court of India. He would contend that
such finding of the respondent-Corporation is contrary to the Rules and
procedures, as the said debarment/blacklisting was not for infinite period
and only for a period of one year. He would also contend that by virtue of
the letter dated 04.11.2020, even Jharkhand Education Project Council has
permitted them to participate in the tender. He would also contend that, the
order of blacklisting has been stayed by the Hon'ble Supreme Court.
Therefore, it is his contention that as on the date of submission of the price
bid, the petitioner was not at all blacklisted. Therefore, it is submission of
the learned Senior Counsel that impugned notice is contrary to law. Thus,
he contended that this writ petition is maintainable and there is no infirmity
in the order passed by the Writ Court. Hence, he prayed to dismiss the writ
appeal.
9. We have given our anxious consideration to either side
submissions.
10. It is well settled principle of law that, if tender process is
challenged before the Writ Court, while exercising the power of judicial
https://www.mhc.tn.gov.in/judis
review, this Court should not substitute it's views in the commercial wisdom
of the tender issuing authority.
11. The Hon'ble Supreme Court in Jagdish Mandal Vs. State of
Orissa and others reported in (2007) 14 SCC 517 has clearly held that,
before the Writ Court interfering with the tender, while exercising the power
of judicial review, should pose itself the following questions:-
“(i) Whether the process adopted or decision made by the
authority is mala fide or intended to favour someone; or
(ii) Whether the process adopted or decision made is so
arbitrary and irrational that the court can say: “the
decision is such that no responsible authority acting
reasonably and in accordance with relevant law could have
reached”;
(iii) whether public interest is affected.”
It was held that if the answers are in the negative, then the Writ Court
should not interfere in the tender process under Article 226 of The
Constitution of India.
12. Here, the one and the only ground to file this writ petition is that
the letter dated 01.03.2022 is contrary to the factual position which believed
https://www.mhc.tn.gov.in/judis
by the petitioner that he was not at all blacklisted as on the date of the
submission of the tender. However, while looking at the Annexure VI of the
Tender form, which is extracted elsewhere in this order, the Corporation has
sought for mere declaration from the tenderers as to whether they have been
blacklisted or not.
13. The harmonious reading of Annexure VI would only indicate
whether they have been blacklisted or not at any point of time. The
annexure does not seek any declaration whether they are blacklisted as on
the date of submission of the tender. Here, the petitioner though admittedly
was blacklisted in the past, has not informed such factual position before the
tender issuing Authority inspite of a specific declaration format provided.
The same necessitated the Corporation to clarify the position, by invoking
power under Rule 27(4) of the Tender Transparency Rules. For ready
reference, this Court deems it appropriate to extract Rule 27(4) of the
Tender Transparency Rules:-
“27. Process of tender evaluation to be confidential until
the award of the contract is notified. -
(1) ..........
https://www.mhc.tn.gov.in/judis
(2) ..........
(3) ..........
(4) Notwithstanding anything contained in sub-rule(3), the
Tender Inviting Authority or the Tender Accepting Authority,
may seek bona fide clarifications from tenderers relating to
the tenders submitted by them during the evaluation of
tenders.”
14. Any tender issuing Authority has got absolute right to know the
reliability and trustworthy of a bidder in the context of a commercial
transaction. In the case on hand, the tender issuing authority has floated
tender on behalf of the Tamil Nadu Government to provide socks to the
school going children. They have got every right to know the commercial
reliability and trustworthy of the bidder in the light of their past conduct in
the context of the transaction in question. Therefore, the writ petitioner
cannot raise any objection at the threshold of the tender process to challenge
the notice which sought the clarification. It is also pertinent to mention here
that even the mere non consideration of bidder's representation thereof
cannot be a ground to seek a Mandamus for consideration of their objection,
when bids were still under consideration and evaluation not yet finalised. It
https://www.mhc.tn.gov.in/judis
is also relevant to refer that the Writ Court while exercising tender
jurisdiction should maintain restrain in exercise of power of judicial review.
In this regard, it is useful to refer the judgment of the Hon'ble Supreme
Court in Tamil Nadu Generation and Distribution Corporation Limited
(TANGEDCO) Vs. CSEPDI-Trishe Consortium reported in (2017) 4 SCC
15. At this juncture, this Court would also like to look at the issue in a
different perspective. Here, the petitioner has challenged the show cause
notice dated 01.03.2022. It is well settled principle of law that mere
issuance of show cause notice will not infringe the right of the party, and
that only the ultimate decision will have effect in affecting the rights of the
parties. To put it differently, the mere issuance of show cause notice
seeking bona fide clarification will not give any cause of action to the writ
petitioner, unless such show cause notice was issued by an incompetent
person or such show cause notice was issued with mala fide intention. As
we already discussed, the Corporation has got power to issue such notice by
virtue of Rule 27(4) of Tender Transparency Act. Therefore, even if the
petitioner has got any grounds in the writ petition, they do not have any
https://www.mhc.tn.gov.in/judis
right to challenge the show cause notice as the same was issued by the
competent authority that too by employing the power conferred under Rule
27(4) of the Tender Transparency Rules.
16. The yet another angle of the instant writ appeal is that, if at all the
petitioner has got any grievances in respect of the show cause notice, they
ought to have preferred an appeal before the Government as contemplated
under Section 11 of the Act. Further, Section 11 statutorily provided 15
days to dispose of the appeal. It is obvious that when a Statute provide a
maximum time period qua 15 days to dispose the appeal, any direction of
granting 48 hours to dispose of the objections is contrary to Section 11 of
the Tender Transparency Act. Whenever, a Statute is available, the Writ
Court while exercising the power of judicial review cannot give a different
time frame. Therefore, this Court is of the firm view that, though no relief
was granted to the petitioner in the writ petition, the finding rendered by the
learned Single Judge in paragraph 49 of the writ order is not in consonance
and contrary to the provisions under Section 11 of the Tender Transparency
Act.
https://www.mhc.tn.gov.in/judis
17. Thus, for all the above reasons, this Court has to necessarily
interfere with the order of the learned Single Judge.
18. In the result, this Writ Appeal is allowed and the writ order
impugned dated 21.04.2022 made in W.P.No.9046 of 2022 is set aside.
No costs. Consequently, connected CMP is also closed.
[S.M.S., J.] [C.K., J.]
19.08.2024
kmi
Index : Yes
Speaking order : Yes
Neutral Citation : Yes
https://www.mhc.tn.gov.in/judis
S.M.SUBRAMANIAM, J.
and
C.KUMARAPPAN, J.
kmi
Pre-delivery judgment in
19.08.2024
https://www.mhc.tn.gov.in/judis
