Orissa High Court
A.K. Das Associates Limited vs Odisha Power Transmission on 2 December, 2022
ORISSA HIGH COURT: CUTTACK
AFR
W.P(C) NO. 20645 OF 2022
In the matter of an application under Articles 226 and 227
of the Constitution of India.
---------------
A.K. Das Associates Limited ..... Petitioner
-Versus-
Odisha Power Transmission
Corporation Limited (OPTCL)
and others ..... Opp. Parties
For Petitioner : Mr. Laxmidhar Pangari,
Senior Advocate along with
M/s. S. Mishra and A. Sahoo,
Advocates,
For Opp. Parties : Mr. A. K. Parija, Sr. Advocate
along with M/s. A. Behera
and A. Mohanty, Advocates
(O.P. Nos.1 to 3)
&
M/s. Sreejit Mohanty,
H.M. Panigrahi and S.K. Mishra,
Advocates.
(O.P. No.4)
P R E S E N T:
THE HONOURABLE DR. JUSTICE B.R.SARANGI
AND
THE HONOURABLE MR JUSTICE B.P. SATAPATHY
Date of Hearing: 24.11.2022 :: Date of Judgment : 02.12.2022
// 2 //
DR. B.R. SARANGI, J. A.K. Das Associates Limited, which is a
company registered under the Companies Act, 1956 and is
engaged in construction of Extra High Voltage (EHV)
Projects comprising of supply-civil installation and erection
of electrical sub-stations and tower lines on total turnkey
basis, has approached this Court by means of this writ
petition with a prayer to declare the decision of Orissa
Power Transmission Corporation Limited (OPTCL)-opposite
party no.1 in awarding the contract for the work "Design,
Engineering, Supply, Erection and Commissioning of (i) 2
x500 MVA, 400/220/33 KV Gas (SF6) Insulated Sub-station
(GIS) with SAS and 1X125 MVAr (400 KV) bus reactor with
control at Ersama, Paradeep. (ii) 400KV AIS feeder bay
extension with SAS (to be integrated with the existing SAS)
and 2 nos. 80 MVAr (400 KV) line reactors with suitable NGR
& its control (One dia) at 400KV New Duburi gird sub-station
for connectivity with proposed GIS S/S at Ersama, Paradeep,
on turnkey contract basis" in favour of opposite party no.4-
M/s. Bharat Heavy Electricals Limited (BHEL) as illegal,
arbitrary and contrary to the conditions of the tender, and
to quash the resolution of the Board of Directors of opposite
// 3 //
party no.1 under Annexure-13 dated 16.07.2022 approving
the decision of the tender committee to issue LOA in favour
of opposite party no.4, and further to issue direction to
opposite party no.1 to conduct a fresh tender in respect of
the very same work, as mentioned above.
2. The facts leading to filing of this writ petition are
that the Orissa Power Transmission Corporation Limited
(OPTCL)-opposite party no.1, a Government of Orissa
Undertaking and a Transmission Licensee under the
Electricity Act, 2003, which is engaged in transmission of
power in the State of Orissa on behalf of the State
Government, floated a tender vide NIT No. 36/2020-21
dated 24.12.2020 under Annexure-2 for "Design,
Engineering, Supply, Erection and Commissioning of (i) 2
x500 MVA, 400/220/33 KV Gas (SF6) Insulated Sub-station
(GIS) with SAS and 1X125 MVAr (400 KV) bus reactor with
control at Ersama, Paradeep. (ii) 400KV AIS feeder bay
extension with SAS (to be integrated with the existing SAS)
and 2 nos. 80 MVAr (400 KV) line reactors with suitable NGR
& its control (One dia) at 400KV New Duburi gird sub-station
// 4 //
for connectivity with proposed GIS S/S at Ersama, Paradeep,
on turnkey contract basis."
2.1 As per the Instruction to Bidder (ITB), a joint
venture or consortium of two qualified firms as partners can
bid in the tender. Accordingly, the petitioner entered into a
joint venture agreement with M/s Siemens Limited and
participated in the tender process, besides seven other
bidders including opposite party no.4-M/s Bharat Heavy
Electrical Limited (BHEL), pursuant to the NIT No.
36/2020-21 dated 24.12.2020 under Annexure-2.
2.2 Under clause-4.1.1(i) of the NIT it was provided
that to be qualified for the tender, the bidder must have
successfully executed and commissioned two numbers of
400 KV or higher voltage class GIS (SF6) Grid sub-station
on turnkey contract basis including Engineering, Design
with Supply, Erection and Commissioning and the said
work should have been completed during the last seven
years reckoned from the date of the opening of bid in India.
Opposite party no.4-M/s Bharat Heavy Electrical Limited
(BHEL) in its bid submitted the documents in the Schedule-
// 5 //
IV of the NIT, which included two performance certificates,
one from SJVN Ltd, a Government of Himachal Pradesh
Undertaking, and the other from NHPC. Of the two
performance certificates submitted by opposite party no.4 in
support of the declaration in Schedule-IV, the certificate
obtained from SJVN Ltd. although indicates that opposite
party no.4 had completed commissioning of 400 KV sub-
station on 04.10.2014, but the same does indicate that the
said project was completed on turnkey contract basis,
which is an essential and mandatory requirement of the
NIT.
2.3 In the meeting held on 03.11.2021, the Purchase
Sub-Committee (PSC) deliberated on the Techno
Commercial Report and recommended that the price bid of
opposite party no.4 may not be opened, as it is techno-
commercially non-responsive and does not meet the
qualifying requirement. Hence, six numbers of bidders,
including the petitioner-company, participated in the tender
process. On qualifying as the top 50% of the responsive
bidders, the petitioner participated in the e-reverse auction
and was found to be the lowest bidder. Accordingly, the PSC
// 6 //
in its meeting held on 25.11.2021 recommended for
issuance of LoA in favour of the petitioner on turnkey
contract basis.
2.4 But the PSC in its meeting held on 29.11.2021
recommended to cancel the NIT under Annexure-2 and to
go for a fresh bid. In the 125th meeting of the Board of
Directors of opposite party no.1-OPTCL, the Board of
Directors approved the recommendation of PSC. As a
consequence thereof, the OPTCL-opposite party no.1 issued
a fresh NIT vide No.CPC-49 of 2021-22 for the same project
for which the NIT vide No. CPC-36 of 2020-21 was issued.
In response to the NIT vide No. CPC-49 of 2021-22 under
Annexure-9, the petitioner as well as M/s BHEL-opposite
party no.4 and three other companies participated in the
tender process and submitted their respective bids along
with requisite documents, including the performance
certificates in respect of previous work orders completed as
per Clause 4.1.1(i) of the NIT.
2.5 In terms of Clause-4.1.1(i) of the NIT, M/s BHEL-
opposite party no.4, along with its bid documents submitted
// 7 //
the performance certificate issued by the SVJN limited,
which indicates that the project for installation of 400 KV
GIS at Rampur was completed and commissioned on
27.10.2015. In view of Schedule-IV of the NIT, the bid of
M/s. BHEL-opposite party no.4 has to be disqualified and
should have been rejected on the ground that the facts
indicated in the format and performance certificate attached
thereto do not disclose that it had executed the project of
SVJN Ltd. at Rampur on turnkey project basis, which is the
mandatory requirement as per Clause-4.1.1(i) of the NIT
and for which the bid of opposite party no.4, which was
submitted in pursuance of the 1st NIT under Annexure-2,
was disqualified. In the certificate furnished in the previous
tender it was indicated that the date of completion of
Rampur Project was 04.12.2014, whereas in the certificate
submitted in the present tender under Annexure-10 series,
the date of completion has been indicated to be 27.10.2015.
The petitioner downloaded from the website of the said
company, i.e. SJVN Ltd., the details of the project in respect
of the certificate obtained, which confirms that at Rampur,
opposite party no.4 has executed the project not on turnkey
// 8 //
basis but on a simple supply contract and the project was
completed on 04.12.2014. Thereby, for having not met the
requirement under Clause 4.1.1 of the NIT, the opposite
party no.4 has become in-eligible for the second tender.
Therefore, its bid should have been rejected. But the
financial bid of opposite party no.4 was opened by opposite
party no.1 for price evaluation, where it was found that
opposite party no.4 had quoted Rs.209,82,28,002/-, which
was 4.75% more than the revised estimated cost, i.e.,
Rs.200,31,49.600/- and Rs.9.00 crores more than the L1
price offered by petitioner in the first tender. Therefore, the
bid submitted by opposite party no.4 should have been
rejected and, as such, the petitioner raised protest against
such illegality and requested opposite party No.2 to take a
fair and just decision in conducting of the tender process.
The authenticity of the performance certificate issued by the
SVJN Ltd. in respect of the project for installation of 400 KV
GIS at Rampur which was submitted by M/s BHEL-
opposite party no.4 for the tender process under Annexure-
9 has been ignored. The inconsistency in the details
regarding the date of completion of the above project has
// 9 //
also been ignored. More so, M/s BHEL-opposite party no.4
does not meet the qualifying requirement as stated in
Clause-4.1.1 of the NIT, as the earlier work executed by the
M/s BHEL-opposite party no.4 was not on turnkey contract
basis, which is an essential and mandatory condition of the
qualifying requirement for bidders under Clause 4.1.1 for
the NIT. In the 129th meeting of the Board of Directors of
opposite party No.1-Corporation, the Board of Directors
ignoring the qualifying requirements in respect of M/s.
BHEL-opposite party no.4, approved the proposal for
issuance of LoA in favour of M/s. BHEL-opposite party
no.4. Hence, this writ petition.
3. Mr. L. Pangari, learned Senior Counsel appearing
along with Mr. S. Mishra, learned counsel for the petitioner
vehemently contended that the acceptance of the bid
submitted by M/s. BHEL-opposite party no.4 by taking the
decision in the Board of Directors' meeting of opposite party
no.1 for issuance of LoA is arbitrary, unreasonable and
contrary to the provisions of law. The performance
certificate dated 07.08.2017 and the performance certificate
dated 22.12.2021 are identical and issued on the self-same
// 10 //
subject-matter. When the first certificate dated 07.08.2017
had not been accepted, the second certificate in respect of
the same subject-matter ought not to have been accepted,
as the performance certificate dated 22.12.2021 did not
envisage a turnkey project that was executed by opposite
party no. 4, which is the requirement in the NIT bearing No.
CPC-49/2021-22. It is further contended that the NIT
bearing No. CPC-49/2021-22 includes execution of civil
work within the scope of the project. The performance
certificate submitted by opposite party no. 4 does not certify
that it has conducted any civil work in execution of such
project.
3.1 It is further contended that once on the basis of
the documents submitted by M/s BHEL-opposite party no.4
in the first tender, the PSC found that the bid of opposite
party no.4 was techno-commercially non-responsive, for the
second tender having the same scope of work and same
qualifying requirement, the documents submitted by M/s
BHEL could not have been accepted. Furthermore, on
receipt of the bid, opposite party no.1 having sought for
information from opposite party no.4 pertaining to techno
// 11 //
commercial evaluation and asked to submit complete order
copy along with the BOQ for supply, erection and civil
contract of the Rampur Hydro Power Station and to submit
credentials/documents/evidence in support of turnkey
project executed, and as per the said query, opposite party
No.4 in its reply vaguely mentioned that M/s BHEL fully
meets the OPTCL QR as far as the turnkey scope is
concerned. According to him, not being satisfied with the
explanation of M/s BHEL-opposite party no.4 that it had
completed the Rampur GIS S/S on turnkey basis, opposite
party no.1 through e-mail made query from SJVN Ltd. to
the effect that "whether both first and second contract
executed by M/s BHEL-opposite party no.4 has been
awarded under turnkey contract basis for 400 KV GIS S/S".
In reply to the said query, SJVN clarified that the contract
for Rampur Hydro Electric Project was awarded to M/s
BHEL covering engineering, design, supply, storage,
erection, testing and commissioning scopes lying with M/s.
BHEL (including 400 KV GIS Switchyard scope), but did not
mention that the contract was executed under turnkey
contract basis.
// 12 //
3.2 It is further contended that PSC of opposite party
no.1 in its proceeding took sudden U-turn and
recommended that M/s BHEL-opposite party no.4 is
meeting both technical and financial qualifications
stipulated in the bid documents by intentionally ignoring
the fact that opposite party No.4 has not submitted any
document to indicate that they have completed any 400 KV
GIS S/S on turnkey basis with associated civil work.
Though the scope of the work of the subject tender includes
massive civil construction, for which the bidders were
required to submit proof, that they have executed similar
type of contracts on turnkey basis with associated civil
works, but ignoring the same the Board approved the
proposal for issuance of LoA in favour of M/s BHEL-
opposite party no.4. That itself vitiates the acceptance of
bid of opposite party no.4, which was otherwise disqualified
for non-compliance of the QR, and the decision of opposite
party no.1 is arbitrary, unfair and illegal.
3.3 It is also contended that M/s BHEL-opposite
party no.4 was disqualified for not having met the techno
commercial requirement of the tender. In the first tender,
// 13 //
the petitioner was the lowest bidder having quoted
Rs.2,00,63,35,946/-. Considering the same, in the second
tender opposite party no.1 had fixed the estimate cost of
the package for Rs. 200.31 crore on turnkey contract basis.
But opposite party no.1 decided to award the contract in
favour of opposite party no. 4 at Rs. 209.32 crore at the
cost of public exchequer, which cannot sustain, and
accordingly contended that the same should be quashed. It
is further contended that the decision taken by opposite
party no.1 to award the contract in favour of opposite party
no.4 is arbitrary, illegal, discriminatory and smacks
favoritism which is against public policy and rule of law. It
is also contended that the basic principles of turnkey
project has not been understood, therefore, award of the
contract in favour of opposite party no.4 cannot sustain.
According to him, "turnkey" means "turn the key" and open
and enter into the house. Meaning thereby, to complete the
work in all respect and allow the awardee of the contract to
enter into the house. The same having been lacked in this
case, the award of contract in favour of M/s BHEL-opposite
// 14 //
party no.4 cannot sustain and the same is liable to be
quashed.
To substantiate his contention, reliance has been
placed by the learned Senior Counsel appearing for the
petitioner on the cases of West Bengal State Electricity
Board v. Patel Engineering Co. Ltd and others, (2001) 2
SCC 451 : AIR 2001 SC 682, Kanhaiya Lal Agrawal v.
Union of India (UOI) and others, (2002) 6 SCC 315 :AIR
2002 2 SC 2766 and Poddar Steel Corporation v. Ganesh
Engineering Works and others, (1991) 3 SCC 273 : AIR
1991 SC 1579 and also Black's Law Dictionary 8th Edition
and Cambridge Business English Dictionary and Wikipedia
for explaining the meaning of turnkey.
4. Mr. A.K. Parija, learned Senior Counsel
appearing along with Mr. Arnav Behera, learned counsel for
opposite party no.1 contended with vehemence that the
performance certificates dated 07.08.2017 and 22.12.2021
are different in context and issued in verification of different
scopes of work, and are also issued for different purposes.
To clarify the same, the performance certificate dated
// 15 //
07.08.2017 was issued for certification that M/s BHEL Ltd.
had designed, manufactured, supplied, tested, erected and
commissioned six (6) numbers of Hydro Generating Sets for
participating in future hydro tenders. Whereas, the
performance certificate dated 22.12.2021 was issued in
respect of complete design, engineering, supply, inland
transportation, insurance, delivery, handling, storage,
erection, testing and commissioning of all equipments
required for 400 KV GIS Switchyard. This clearly satisfies
the 'turnkey' requirement under the tender. It is also
contended that the certificate dated 22.12.2021 clearly
states that the date of commissioning of 400KV GIS
Switchyard was 27.10.2015, which is within a period of 7
years on the date on which the NIT was issued, i.e., on
07.01.2022. Opposite party No.1 sought clarifications from
opposite party no. 4 regarding the issuance of performance
certificates dated 07.08.2017 and 22.12.2021 vide email.
Opposite party no. 4 on 05.03.2022 clarified in clear terms
that the performance certificate dated 22.12.2021 is
specifically for 400 KV GIS Switchyard portion for complete
Rampur HEP (412 MW) E&M package which was
// 16 //
successfully commissioned by M/s BHEL as an EPC
contractor on 27.10.2015. On the other hand, the
performance certificate dated 07.08.2017 was issued by
SJVN Ltd. for Generating Units. M/s. BHEL further clarified
that the performance certificate dated 22.12.2021 was
issued for "Engineering, Design, Erection and
Commissioning" of the Project which was the pre-requisite
as per tender definition for a turnkey contract.
4.1 It is further contended that opposite party no. 1
sought clarifications from SJVN Ltd., which were confirmed
vide E-mail dated 14.03.2022, thereby, so far as non-
execution of civil work is concerned, that is completely a
misconceived one. The NIT at Clause 2.2 (ix) (G), (H) and (I)
identifies the civil work to include, inter alia, construction
of control room building & other systems like illumination
of building, ventilation, ceiling, air conditioning, firefighting
& smoke detection facility as per specification. Therefore,
the submission that M/s BHEL-opposite party no.4 had
not executed any civil work even though the same was
required by the NIT, is not tenable. In so far as the
allegation that the project executed by M/s BHEL Ltd. was
// 17 //
not on a turnkey basis is concerned, the same does not
stand on any legal footing.
4.2 To substantiate his contention, reliance has been
placed on the definition of "turnkey" as laid down by the
apex Court in the Indure Ltd. & Anr. v. Commercial Tax
Officer & Ors. (2010) 9 SCC 461, Director of Income Tax-
II (International Taxation) New Delhi and Anr. v.
Samsung Heavy Industries Company Ltd, (2020) 7 SCC
347. Reliance is also placed on Black's Law Dictionary
(8th edn.) at page 1555.
4.3 Further, it is contended that the scope of judicial
review in respect of award of tenders is very limited and
interference can only be made if a clear-cut case of
arbitrariness, mala fide, or bias or irrationality is made out.
To substantiate the same, reliance is placed on the cases of
Pratap Chandra Sahu v. State of Odisha and others,
2020 (II) OLR 126; Utkal Suppliers v. State of Odisha &
Ors. 2020 SCC OnLine Oni 670, Silppi Constructions
Contractors v Union of India & Anr, (2020) 16 SCC 489,
Uflex Limited v. Government of Tamil Nadu and others,
// 18 //
(2022) 1 SCC 165 and N.G. Projects Limited v. Vinod
Kumar Jain & others, (2022) 6 SCC 127. Thereby, it is
contended that there is no infirmity in the decision making
process, nor is the decision of opposite party no.1 to award
tender in favour of opposite party no.4 arbitrary, illegal or
contrary to the conditions of the tender so as to warrant
interference by this Court.
4.4 It is further contended that the petitioner has
abandoned his bid being not participated in the E-Reverse
Auction by not reducing his bid price. Therefore, the
petitioner has no locus standi to maintain the present writ
petition. The petitioner, having abandoned his bid by not
participating in the E-Reverse Auction by not reducing his
price, is not a "Person Aggrieved" and, therefore, has no
locus to challenge the grant of tender to opposite party no.
4. Accordingly, he contended that the writ petition is liable
to be dismissed.
5. Mr. S. Mohanty, learned counsel appearing for
opposite party no.4 very fairly contended that M/s BHEL is
the beneficiary of the decision taken by opposite party no.1-
// 19 //
OPTCL and whatever argument has been advanced by Mr.
A.K. Parija, learned Senior Counsel appearing for the
opposite party no.1 is being adopted by it. In addition to the
same, it is contended that the petitioner was a constituent
of an unincorporated joint venture led by M/s Siemens Ltd.
The said unincorporated joint venture, which is a legal
entity, was the bidder. But the instant writ petition has
been filed by the petitioner alone who, on its own, is not
qualified as a bidder. It is contended that the petitioner,
being ineligible to bid on its own, cannot have any
independent cause of action to file this writ petition.
Thereby, seeks for dismissal of the writ petition.
5.1 It is further contended that opposite party no. 4
fulfills the requirements stipulated in Clause-4.1.1 of the
NIT on the basis of the performance certificates issued in
respect of the work executed for Gujarat State Electricity
Corporation Ltd. and SJVN Ltd. at Rampur Project.
Therefore, the allegation made, that Rampur Hydroelectric
Project of SJVN Ltd. was not executed by opposite party
no.4 on turnkey basis, cannot sustain in the eye of law. It is
contended that the employer of the said project i.e., SJVN
// 20 //
Ltd., a PSU has expressly certified vide performance
certificate dated 22.12.2021 that opposite party no.4 has
done "complete design, engineering, supply, inland
transportation, insurance, delivery, handling, storage,
erection, testing & commissioning of all equipment required
for 400 KV GIS Switchyard". Thereby, the term "turnkey" is
explained in dictionary to mean "complete and ready to use
immediately". This term has varied meaning as per the
definitions in legal dictionaries. Clause-4.1.1 (i) of the NIT
employs the term "turnkey contract" in the context of
specifying the qualifying requirements of the bidders. As
such, the term "on turnkey contract" in sub-clause-(i) of
Clause-4.1.1 of the NIT is preceded by the words,
"Engineering, Design, Erection and Commissioned of: (i)
two nos. of 400 KV or higher voltage class GIS (SF6) Grid
sub-station with minimum (Three) Bays in each S/S".
Therefore, it is contended that the word preceding the
phrase "on Turnkey Contract" lend colour to the term "on
turnkey contract". As M/s BHEL-opposite party no.4 had
executed the work of different nature, that fulfills the
requirement of "on Turnkey Contract" as per Clause-4.1.1
// 21 //
(i) of the NIT. Thereby, no illegality or irregularity has been
committed in settling the contract in its favour. According
to him, if at all there is any ambiguity in construing the
meaning of the term "on Turnkey Contact" at Clause-
4.1.1.(i) of the NIT, then the interpretation of the said term
by the author of the NIT, namely, OPTCL- opposite party
no.1 deserves primacy. Opposite party no.1-OPTCL having
examined the information and documents furnished by M/s
BHEL-opposite party no.4, who was fulfilling the qualifying
requirement as per the NIT, has also sought clarification
and opposite party no.4 has responded to such request by
furnishing explanation with supporting material, and
opposite party no.1 has cross-checked the correctness of
the explanation furnished by opposite party no.4 from
SJVN Ltd. and only after deliberating on the clarification
furnished, proceeded to qualify the opposite party no.4. As
such, the petitioner cannot raise objection on such decision
and also in exercise of power of judicial review, the Court
should not interfere with the said decision making process,
as there is no arbitrariness, unreasonableness by reaching
// 22 //
such conclusion. Thereby, he prayed for dismissal of the
writ petition.
5.2 To substantiate his contention, reliance has been
placed on Gammon India Limited v. Commissioner of
Customs, Mumbai, (2011) 12 SCC 499 and Consortium of
Thermopads Pvt. Ltd v. National Aluminum Company
Ltd, MANU/OR/0441/2022.
6. This Court heard Mr. L. Pangari, learned Senior
Counsel appearing along with Mr. S. Mishra, learned
counsel for the petitioner and Mr. A.K. Parija, learned
Senior Counsel appearing along with Mr. A. Behera, learned
counsel for the opposite parties no.1 to 3, and Mr. S.
Mohanty, learned counsel appearing for opposite party no.4
in hybrid mode and perused the records. Pleadings have
been exchanged between the parties and with the consent of
learned Counsel for the parties, the writ petition is being
disposed of finally at the stage of admission.
7. On the face of the factual matrix as well as the
rival submissions of the parties, as delineated above, the
// 23 //
following issues are framed for effective adjudication of the
case:-
(1) Whether the decision taken for issuance of
LoA by the OPTCL-opposite party no.1 in
favour of BHEL-opposite party no.4 on the
basis of the performance certificate furnished
by it satisfying the requirement of "Turnkey
Contact", pursuant to the NIT No. CPC
49/2021-22 is justified or not ?
(2) Whether the petitioner has locus to file the
present writ petition or whether the writ
petition filed at the behest of the petitioner is
maintainable or not ?
(3) Whether the petitioner is a person aggrieved
or not?
8. Issue No.1.
To answer this issue in proper perspective, it is
worthwhile to take note of the relevant conditions stipulated
in the E-Tender Notice No.CPC-49/2021-22 for Package-
49/2020-21 under Annexure-9.
(Page-82 of the Brief)
"ODISHA POWER TRANSMISSION CORPORATION LTD.
invites bids (in e- tendering mode only) under single
stage two-envelop system from reputed EPC/Turnkey
Contractors for Design, Engineering, Supply, Erection
and Commissioning of:
(i) 2x500 MVA, 400/220/33KV Gas (SF6) Insulated
Sub-station (GIS) with SAS and 1X125 MVAr (400 KV)
bus reactor with control at Ersama, Paradeep.
(ii) 400KV AIS feeder bay extension with SAS (to be
integrated with the existing SAS) and 2 nos. 80 MVAr
// 24 //
(400 KV) line reactors with suitable NGR & its control
(One dia) at 400KV New Duburi gird sub-station for
connectivity with proposed GIS S/S at Ersama,
Paradeep.
at an Estimated Cost of the Package for Rs. 200.31
Crore on "Turnkey CONTRACT BASIS".
The contents of the NIT are as follows:-
(Page-83 of the Brief)
Sl. No. Particulars Page No
From To
1. Tender Notification
Notice Inviting Tender (NIT) 2 2
2. Bid Documents
VOLUME-I (Free View) 5 8
Section-I- e-Notice Inviting Tender (e-NIT) 9 42
Section-II: Instruction to Bidder (ITB) 43 98
Section-III : General Conditions of 99 113
Contract
Section-IV: BID PROPOSAL SHEET (BPS) 114 148
Section-V: ANNEXURE
For Participant Bidder (s)
VOLUME-II : (ENCLOSED SEPARATELY)
Section-I: SCOPE OF WORK,
TECHNICAL SPECIFICATIONS.
Section-II: GUARANTEED TECHNICAL
PARTICULARS (GTP)
3. For Participant Bidder (s)
Bid Forms (In. XLS Formats):
(AVAILABLE IN THE E-TENDER PORTAL
OF OPTCL)
Section-I: TECHNICAL SCHEDULES.
Section-II : PRICE SCHEDULES.
(Page-84 of the Brief)
VOLUME-I
Section-I: e-Notice Inviting Tender (e-NIT)
Section-II: Instruction To Bidder (ITB)
Section-III: General Conditions of Contract (GCC)
Section-IV: BID PROPOSAL SHEET (BPS)
Section-V : ANNEXURES.
(Page-91, 92 & 93 of Brief)
Instruction to Bidder (ITB)
// 25 //
2.0 Brief Scope of Package (s)/Works:
2.1 Package (s)/Work No.: <49/2021-22>
2.2 Scope of Works: Design, Engineering, Supply,
Erection and Commissioning of:
(i) 2x500 MVA, 400/220/33KV Gas (SF6) Insulated
Sub-station (GIS) with SAS and I X125 MVAr (400 KV)
bus reactor with control at Ersama, Paradeep.
(ii) 400KV AIS feeder bay extension with SAS (to be
integrated with the existing SAS) and 2 nos. 80 MVAr
(400 KV) line reactors with suitable NGR & its control
(One dia) at 400KV New Duburi gird sub-station for
connectivity with proposed GIS S/S at Ersama,
Paradeep.
i) Supply of all equipment & materials for the sub-
station including 2x500 MVA, 400/220 KV ICTs
& 125MVAr (400 KV) Bus Reactor and 80MVAr
(400 KV) Line Reactors with NGR etc as per
Price Schedule & Technical Specification
xxx xxx xxx
vii) Execution of civil works as per schedule for
erection of Building (S/S), equipment
foundation(S/S), construction of earth mat, cable
trench, drainage system, Boundary Land
Scaping, approach roads, inside roads, Main
Gate etc. etc. as per Price Schedule &
Technical Specification
xxx xxx xxx
ix) Name of the work: Construction of 2x500 MVA,
400/220/33 KV Gas (SF6) Insulated Sub-
station (GIS) with SAS at Ersama, Paradeep
and 125 MV Ar bus reactor.
Details of Provisions to be kept in the Sub-
station are as follows:
Scope of work for GI sub-station:
xxx xxx xxx
(E) Supply, installation, testing & commissioning
of Sub-station automation system including
protection panels as per specification. The SAS
architecture shall be on PRP (Parallel
Redundancy Port) based, therefore accordingly
all the LED's (IEC 61850) shall be selected for
the GIS station.
// 26 //
(F) Supply and installation of equipment &
materials as per BPS (including all civil works)
(G) Construction of 400KV & 220 KV GIS
room building with BOT crane & other system
like illumination of building, ventilation system
with separate AHU unit, Air conditioning for
panel rooms, firefighting & smoke detection
facility etc. as per specification and BPS.
Provision of Building, lightning protection. The
outer & internal painting shall be suitable to
resist from the effect of saline & chemical as
Paradeep is near sea coast.
(H) Construction of Control room building &
other system like illumination of building,
ventilation, Ceiling, Air conditioning, firefighting
& smoke detection facility etc as per
specification and BPS. Provision of Building
lightning protection. The outer & internal
painting shall be suitable to resist from the
effect of saline & chemical as Paradeep is near
sea coast.
(I) Provision of store shed, earthing, fencing,
roads, drains, gates, security shed, water
arrangement, Lighting cum Lightning Masts,
Switchyard illumination and all other civil
works etc as per specification and BPS.
xxx xxx xxx
(M) Other requirement as indicated below for
both the GIS sub-stations:
1. Construction of GIS and Control room
building. Construction of other pudding as
indicated in the price schedule. Paintings
of the buildings.
2. Provision of equipment foundations,
erection of structures & equipment. Store
shed, Boundary wall & its painting, earth
mat & earth pits & provision of water to
the earth pits, fencing, roads, drains,
gates, security shed, Bore wells for water
arrangement, provision of PHED system,
Lighting cum Lightning Mast, Switchyard
illumination, switch yard building & other
// 27 //
building illumination, Transformer
foundation, oil sump pit for the
transformer, Fire wall, street lighting, and
all other civil works etc. as per
specification.
3. Testing and commissioning of Substation
equipment & accessories.
4. Contractor is advised to procure the
equipment & materials sequentially as per
the requirement at field, to avoid
unnecessary dumping at the site.
Therefore. prioritization of such
procurement shall he carried out in
consultation with the Engineer in Charge.
5. Successful testing, commissioning &
inspection of the installations as per Govt.
rule to be considered.
6. Commissioning of the Sub-station & detail
material reconciliation.
7. Handing over of the completed system to
the Owner.
(Page-95, 96 of Brief)
4.0 QUALIFYING REQUIREMENTS (QRs) OF
BIDDER(S):
4.1 Technical Qualification:
This bid is open to any EPC/Turnkey Contractor
domicile in India independently or in Joint
Venture/Consortium, who meets the following
Technical qualifying requirement;
4.1.1 The bidder, as a Principal Contractor must have
successfully executed and Engineering, Design,
Erection and commissioned of:
(i) Two nos. of 400 KY or higher voltage class GIS
(SF6) Grid sub-station with minimum 3 (Three)
Bays in each S/S on Turnkey Contract-
// 28 //
(ii) Erection and Commissioning of at least one no.
of ICT of capacity 315 MVA (400/220 KV) or
above.
(iii) Must have successfully executed and
Commissioned of Two nos. of 400 KV or higher
voltage class Bay (AIS) on Turnkey Contract
basis including Engineering, Design with
Supply, Erection and Commissioning.
(iv) The GIS must be offered from Indian
Manufacturer, who meets the requirement
mentioned at 4.1.2.
On Turnkey Contract basis in India for,
Any Transmission/Generation Utility
State Govt. / Central Govt. / any PSU.
OR
Any Associated Transmission System
for IPPs (Independent Power Producers)
having installed capacity of 500MW or
above in India.
OR
Any agency awarded in a Tariff Based
Competitive Bidding (TBCB) by any
State Govt. / Central Govt. /PSU in
India.
The above work should have been
completed during last 7 (Seven) years
reckoned from the date of opening of
Bid(s) in India.
The above work should have been
under successful operation for a
minimum period of one year reckoned
from the date of opening of Bid(s).
(Page-99 &100 of the Brief)
4.1.3 Other Technical Qualification:
4.1.3.2 The Bidder must upload copies of the relevant
Work Orders along with Handing Over and Taking over
Certificate or Client certified copies of Completion
Certificate in proof of successful execution of Works and
// 29 //
Performance Certificates duly signed by the competent
authority of the Principal employer in proof of
successful operation of the above quantum of work's.
The works experience schedule shall be as per
proforma given here under.
Table: Tech-1
Work Experience Schedule
Work Order Sub-Stations/Lines Installed,
Ref. Erected Commissioned
Sl. FY Name Work Qty (No. of Date of Documents
No of the Order Sub- Completio provided in
Client Ref Stations/ n of proof of
(No. & Kms of Commissio having
Date) Lines) ning completed
Installed/ the works
Erected and/ or of
successful
operation as
the case
may be.
(As
Attachment)
Note:
1. The Tech-1 (Work Experience Schedule) is in
XIS format as Schedule-IV of Technical bid
hosted in the Tender portal and the same shall
be keyed in by the bidder(s).
2. Supporting documents in favour of the above
mentioned requirement shall have to be
submitted/ uploaded by the Bidder as an
attachment to the e-tender folder (Attach 3.pdf).
3. Failure to furnish/upload any or all
information as required as a part of Bid
document in all respect will be at the Bidder's
risk and may result in rejection of the Bid.
(Page-100 &101 of the Brief)
// 30 //
4.2 Bidder's Performance Qualification:
xxx xxx xxx
4.2.4 The bidder must not been declared Insolvent or
referred to National Company Law Tribunal (NCLT)
under the Insolvency and Bankruptcy Code (IBC), 2016.
In such case the bid shall also be rejected. In this
respect one undertaking from the bidder that they are
not declared as Insolvent or referred to NCLT under IBC
shall be submitted along with the bid. Non-disclosure of
this fact by the bidder will lead to rejection of the bid or
termination of the contract with forfeiture of
EMD/CPBG.
Note:
1. The intending bidder shall furnish/upload the
undertaking to this effect in the prescribed format
enclosed to the e-tender.
2. Failure to furnish/upload any or all information as
required as a part of Bid document in all respect will be
at the Bidder's risk and may result in rejection of the
Bid.
(Page-103-104 of the brief)
4.4 BID CAPACITY QUALIFICATION:
iii. Bidder's Technical Bidder shall be Technically
Eligibility eligible based on the
qualifying requirement
mentioned under Clause-4
(Qualifying Requirments
(QRs) of Bidder) except
Bidders Bid Capacity.
(Page-110-111 of the brief)
5.5 Documents/ Schedules to be Furnished/
Uploaded/ Keyed-in:
// 31 //
1. Technical Bid-Part-I
(B) Soft Form of Documents (Scanned Copy to be
uploaded in the e-Tender Portal of OPTCL):
Following are the Soft form of scanned documents in PDF
file to be uploaded on the Official e-Tender Portal of
OPTCL www.tenderwizard.com/OPTCL as an
attachment.
3. Following documents/Credential in support of
meeting Technical Qualifying requirement:
i. Work Orders/LOA (including detailed bill of
quantity for supply & erection works with
associated civil works)
ii. Commissioning Certificate/ Handing Over
and Taking Over Certificate/ Client Certified
copies of completion certificate in respect of
the work orders furnished as above.
iii. Performance Certificate in respect of the
work orders furnished as above.
iv. Valid HT/EHT Electrical License of the EPC/
Turnkey Contractor available from
anywhere in India. (In case of Joint
Venture/Consortium Valid HT/EHT license
available from anywhere in India possesses
by the Lead partner).
8.1 Taking into consideration the above conditions, it
is to examine whether M/s. BHEL-opposite party no.4 has
satisfied the requirement or not. There is no dispute that
earlier opposite party no.1 issued a notice inviting tender
bearing NIT No. CPC-36/2020-21 (PACKAGE- 36 (i)/2020-
21). But the same was cancelled, pursuant to which the
second tender was issued vide NIT No. CPC-49/2021-21
(PACAKGE-49/2020-21) under Annexure-9. Thereby, the
// 32 //
bidder has to satisfy the requirement, as mentioned in the
bid documents. For the purpose of adjudication, the
relevant portion of the NIT has already been referred to
above. On that basis, the petitioner and opposite party no.4
applied for the same. On receipt of the bids, the OPTCL-
opposite party no.1 sought clarification from M/s. BHEL-
opposite party no.4 pertaining to techno commercial
evaluation and also asked to submit complete order copy
along with the BOQ for supply, erection and civil contract of
Rampur Hydro Power Station and to submit credentials/
documents / evidence in support of turnkey project
executed vide letter dated 03.03.2022 under Annexure-F/1
and directed that the same should reach before 11.00 A.M.
on 07.03.2022.
8.2 The query made was to the following effect:-
(Page-196 of the brief)
Sl. No. Requirement as Bidders to comply
per bid document (uploaded the same in
tender wizard and also
submit hard copy of the
same.
Two nos. of 400 (i) The bidder have done
KV or higher the E&M works of
voltage class GIS Rampur HEP (412 MW)
(SF6) Grid sub- including scope of 400kV
station with GIS switchyard of SJVN
minimum 3 Ltd. The bidder should
(Three) Bays in submit the complete order
// 33 //
each S/S on copy along with the BoQ
Turnkey for Supply, Erection and
Contract. Civil contract of above
work.
(ii) Again as per
performance certificate
issued by AGM/Project
Manager (EM Works),
Rampur HPS, Bayal
against Pkg-36(II)/2020-
21, the RAMPUR HPS
units along with 420 KV
Gas Insulated Switchgear
have been commissioned
between 19.03.2014 to
04.12.2014. As per
Performance certificate,
after completing the 420
kV Gas Insulated
Switchyard and other
Associated work of HPS,
Unit-1 Generating Set was
put on commercial
operation from
19.03.2014.
(ii) But now as per the
Performance certificate
submitted for Pkg-
49/2021-22, the
commissioning date is
27.10.2015 for same
RAMPUR HPS
From point (i) & (ii) above,
it is not clear how the
same 420 KV switchyard
can be commissioned in
two different dates.
Again the performance
certificate issued on
22.12.2021 by SJVN Ltd.
Is for 400 KV Switchyard.
However as per Tender
condition you have to
submit the credentials for
2 nos. of 400 KV GIS s/s
with minimum 3 nos.
bays in each S/S on
turnkey basis.
Please justify the above
// 34 //
along with evidentiary
documents. Otherwise
submit
credentials/documents
evidence in support of
turnkey project executed.
8.3 In reply to the above query, M/s BHEL-opposite
party no.4 submitted under Annexure-G/1 dated
05.03.2022 as follows:-
(Page 201 & 202 of the brief)
Part-i
The complete Order copy of Contract Agreement &
NOA has been submitted along with our hid (the same
is being enclosed again as Annexure-IA). As desired
BOQ/BBU for 400 kV GIS Switchyard at Rampur HEP
is being enclosed as Annexure-IB.
It is Submitted that, as per OPTCL Tender
specification (Qualification criteria for EPC Bidder for
GIS project as per clause 4.1.1 of ITB of tender
specification), following is the requirement: -
"The bidder, as a Principal Contractor must have
successfully executed and Engineering, Design.
Erection and Commissioning of:
i. Two nos. of 400kV or higher class GIS (SF6) Grid
sub-station (with minimum three bays in each S/S
on Turnkey contract"
It is evident from the above that "Engineering, Design,
Erection and Commissioning" is the pre-requisite
requirement as per tender definition.
In line with above requirement, BHEL had submitted
following performance certificates issued by M/S
GSECL and M/S SJVN (The same was also submitted
// 35 //
along with our original techno-commercial bid and
attached as Annexure-2 with this letter)
a. M/s GSECL for 400 kV GIS Switchyard at 1x800
MW Wanakbori TPS (comprising of 7 nos. of 400
kV GIS bays)
b. M/s SJVN for 400 kV GIS Switchyard at 412 MW
Rampur HEP (comprising of 12 nos. of 400 kV
GIS bays)
The performance certificate clearly states that the
project scope included "Engineering, Design, Erection
and Commissioning" in line with OPTCL tender
specification requirement.
With the above, BHEL meets the specific tender
Qualification Requirement of OPTCL.
Part-ii (Para-1)
Performance certificate issued by M/s SJVN (a Mini
Ratna, Category-I and Schedule-'A' CPSE under
administrative control of Ministry of Power, Govt. of
India) on 22.12.2021 is specifically for the 400 kV GLS
Switchyard portion for complete Rampur HEP (412 MW)
E&M package which was successfully commissioned
by BHEL as an EPC contractor (400 KV GIS scope as
complete system) and taken over by M/s SJVN Ltd. on
27.10.2015.
Performance certificate, as is being referred to by
OPTCL (submitted by BHEL, for package-36(II)/2021)
was issued by M/s SJVN for Generating units (related
to Power Plant scope for the E&M package).
Since OPTCL had raised post bid query/objection on
bid submitted by BHEL for package-36(II)/2021
regarding the language used in the said performance
certificate ("for the purpose of Hydro tenders"), a 400KV
GIS scope specific certificate (for better clarity) was
requested to M/s SJVN and the same was duly issued
by M/s SJVN on 22.12.2021 clearly certifying BHEL's
credentials for 400 kV GIS EPC scope.
Part-ii (Para-2 and 3)
// 36 //
Regarding "Turnkey" word mentioned in the said
paras, please refer to the constituent scopes as defined
in the said term "Turnkey" as per OPTCL tender QR
vide clause 4.1.1 of ITB of tender specification, which
explicitly stipulates that
"The bidder, as a Principal Contractor must have
successfully executed and Engineering, Design,
Erection and Commissioning of
i. Two nos. of 400kV or higher class GIS (SF6) Grid
sub-station (with minimum three bays in each S/S on
Turnkey contract"
It is evident from above that "Engineering, Design,
Erection and Commissioning" is the pre-requisite
requirement as per tender definition for a turnkey
contract.
As per above requirement, BHEL had duty submitted
the performance certificates (Rampur and Wanakbori),
wherein, both the certificates clearly states that the
project scope included "Engineering, Design, Erection
and Commissioning"
Hence it is submitted that BHEL fully meets the OPTCL
QR as far as the "turnkey" scope deis concerned.
Please note that the QR does not include "civil works"
categorically as QR requirement."
Thus, the query, which was made by the OPTCL vide letter
dated 03.03.2022 in Annexure-F/1, was replied by M/s.
BHEL on 05.03.2022, i.e. within seven days period
contending that it satisfies the requirement.
8.4 Again a query was made, with regard to
confirmation of satisfactory work completion from Rampur
HPS, by the OPTCL vide letter under Annexure-H/1. In
// 37 //
response to the same, clarification was also received on
05.03.2022 through e-mail to the following effect.
(Page-209 of the brief)
"OPTCL Query 1 : Regarding issuance of both
the performance certificates.
Draft Reply: It is confirmed that both the certificates
are issued by SJVN.
A Performance Certificate dated 07.08.2017 was
issued on BHEL's request (For Unit 1 &6) as
credentials for participation in future Hydroelectric
project tenders (Power Plant Scope).
A Performance Certificate dated 22.12.2021 was
issued on BHEL's request as credentials for 400 kV
GIS Switchyard Scope (Part of complete Rampur
Hydroelectric Project Package including addition
Bay for Reactor) for participation in all future GIS
project tenders.
OPTCL Query 2: Whether both 1st & 2nd
contract executed by M/s BHEL has been
awarded under turnkey contract basis for 400
kV GIS Substation.
Draft Reply: The contract for Rampur Hydro Electric
Project was awarded to M/s BHEL covering
Engineering, Design, Supply, Storage, Erection,
Testing and Commissioning scopes lying with M/s
BHEL (including 400 KV GIS Switchyard scope)."
8.5 The petitioner vehemently contended that the
performance certificate, which was produced by M/s BHEL-
opposite party no.4, does not meet the requirement of the
NIT. Therefore, it would be just and proper to refer to the
performance certificate issued by SJVN Ltd, a joint venture
// 38 //
of Government of India & Government of Himachal Pradesh
indicating therein that the opposite party no.4 has
discharged its responsibility for Rampur Hydro Power
Station (412 MW). The performance certificate dated
22.12.2021, which has been annexed as Annexure-10 reads
as follows:-
(Page-119 of the brief)
To Whomsoever it may concern
Performance Certificate
"This is to certify that M/s. Bharat Heavy Electricals
Limited (BHEL) has been awarded the contract by
M/s SJVN Ltd. (Formerly Satluj Jal Vidyut Nigam
Limited) for E&M works of Rampur HEP (412 MW)
including scope of 400 kV GIS Switchyard vide
Contract Ref: SJVN/ECD/RHEP/ EM (Pkg-I) 1st
contract. 08-1 & 2nd Contract/08-2 dated 16.10.2008.
The Scope of Switchyard includes complete design,
engineering, supply, inland transportation, insurance,
delivery, handling, storage, erection, testing and
commissioning of all equipment required for 400 KV
GIS Switchyard.
400kV GIS Switchyard Configuration as below:
Scheme-Two Main Bus Bar Scheme
Total Bays- 12 Nos CB bays with following feeders:
1. 400 kV Line Bays-4 Nos.
2. 400 kV Generator Transformer Bay-6 Nos.
3. 400 kV Bus Reactor Bay-1 No.
4. 400 kV Bus Coupler Bay-1 No.
Following BHEL make equipments were also supplied
including complete design, engineering,
manufacturing, inland transportation, insurance,
delivery, handling, storage, erection, testing and
commissioning) as part the scope of 400 kV GIS
Switchyard.
1. 1 no. 80 MVAR, 420 Bus Reactor.
// 39 //
2. 12 nos. 400 kV Capacitive Voltage
Transformers.
3. Control, Protection & Relay Panels with
Switchyard SCADA.
4. Porcelain Disc Insulators and associated
hardware.
The above 400 kV GIS Switchyard was successfully
commissioned by M/s BHEL w.e.f 27.10.2015.
The 400 kV GIS Switchyard including all equipment
has been operating satisfactorily since then.
This certificate is being issued to M/s BHEL on their
request vide letter No. Ref: TBMS/21/PC/400KV
Swyd Rampur Dated:20.12.2021, to enable them
participate in forthcoming/future tenders."
On perusal of the above mentioned performance certificate,
it is made clear that the scope of Switchyard includes
complete design, engineering, supply, inland transportation,
insurance, delivery, handling, storage, erection, testing and
commissioning of all equipment required for 400 KV GIS
Switchyard. Therefore, from the starting to finishing of work
called Turnkey Project and erection comes under civil work.
Therefore, M/s. BHEL-opposite party no.4 satisfies the
requirement of NIT.
8.6. The meaning of "ERECTION" if will be taken into
consideration, then "ERECTION," generally, is a wider term
than "BULDING" and may include trade FIXTURES.
// 40 //
"ERECTION" in relation to a building includes extension,
alteration or re-erection.
8.7. In H.E. Dibble Ltd. v. Moore, (1969) 3 All ER
1465, 1471 (CA), while considering Section 62 (1) of Law of
Property Act, 1925, the word 'erection' does not embrace
something that is not a part of the land, either as a fixture
or otherwise.
Erection, commissioning and installation" means
any service provided by commissioning an installation
agency in relation to erection, commissioning and
installation of plant, machinery or equipment.
In view of Section 65 and 39 (a) of the Finance
Act 32 of 1994, which has been inserted by Finance Act 23
of 2004 in Section 90.
Thereby, there is no iota of doubt that if the
meaning of erection will be taken into consideration, then it
includes a nature of work which will be done extension or
alteration or does not embrace something that is not a part
of the land, either as a fixture or otherwise.
// 41 //
Thereby, for the fixture or otherwise, it requires a
civil work. Thus, it cannot be construed that the opposite
party no.4 had no experience on turnkey contract.
8.8. Turnkey Project means a contract under which
the contractor assumes responsibility to the client for
constructing productive installation and ensuring that they
operate effectively before turning them over to the client.
8.9. In Understanding & Negotiating Turnkey and
EPC Contract, 2nd Ed. By Joseph A. Huse, the concept of
turnkey contracts has been discussed in detail and it has
been held as follows:
"The 'turnkey' arrangement (also known as the
'package deal', 'design and build', 'de-en-main',
'design and construct' or 'EPC' places the duty to
design and construct solely on the contractor. There
is no accepted definition for each of these terms in
the construction field. The term 'turnkey' tends to
mean the most extreme form of placing design and
construction responsibility on the contractor, such
that after completion the employer need only turn the
key to commence operation of the constructed
facility."
8.10 In Hudson's Building and Engineering
Contracts, 11th Ed., para 3.029 at p. 428, the essential
conditions of a turnkey contract are enumerated as under :
// 42 //
"Thus, in these contracts the essential feature is that
the owner does not employ his own professional
advisers to produce the design of the building or
project which he requires. Either by negotiations or
by outline specification to tendering contractors, the
owner makes known his requirements and the
contractor then produces the design, in the form of
drawings, a specification and sometimes schedules
of rates to cover possible variations. Bills are not
usually used in such contracts, which will almost
invariably be lump 'sum, since clearly there would be
unacceptable pricing risks for an owner if bills were
to be prepared by a contractor for use in a measured
contract....."
8.11 In FIDIC- An analysis of International
Construction Contracts (Edited by Robert Knutson, p.
127-28, it has been stated :
"In India the concept of Turnkey is understood in the
same way as it is in most of the other countries.
Generally speaking, it relates to that aspect of
Construction Con-tracts where the contractor takes
'complete responsibility' for an engineering project.
Complete responsibility would include furnishing of
all plant, labour materials, supplies, equipment
transportation, super-vision, technical, professional
and other services. The contractor is under an
obligation to perform all operations relating to design,
manufacture, delivery installation and the design
and execution of building or engineering works as
contracted. In the case of Turnkey Contract or a
product-in-hand con-tract, the general description of
a scope of construction may be contemplated by
additional contractual provisions, obligating the
contractor to effect all construction which, although
not specifically described is nevertheless necessary
or usual, having regard to the agreed operational
capabilities of the works. Such a provision may avoid
disputes as to who is to supply all items of material
or perform minor items of construction either
forgotten during the negotiation or not considered
worthy or special mention. The mere use of the term
Turnkey may not be sufficient to impose such an
obligation on the contract."
// 43 //
8.12 In Black's Law Dictionary, Eighth Edition, page-
344 states as follows:-
Engineering, procurement and construction contract.
A fixed-price, schedule-intensive construction
contract-typically used in the construction of single-
purpose projects, such as energy plants- in which the
contractor agrees to with variety of responsibilities,
including the duties to provide for the design,
engineering, procurement and construction of the
facility, to prepare start up procedures; to conduct
performance tests; to create operating manuals; and
to train people to operate the facility-Abbr. EPC
contract- Also termed turnkey contract."
8.13. Therefore, Turnkey Project in which the
ownership is originally transferred from original
builder/proprietor only after ensuring that everything is
"turn on" and running properly.
8.14 In Indure Ltd. (supra), the apex Court at
paragraph-3 observed as follows.
"Tenders were invited by N.T.P.C on 08.01.1988 for
submitting bids for Ash Handling Plant Package for
its Farakka Super Thermal Power Project, Stage-II,
by way of International Competitive Bidding,
popularly known as Global Tender. The scope of
work involved in such package included designing
and engineering, manufacture, inspection and
testing at suppliers works, packing, transportation to
site, unloading, storage and handling at site,
erection, testing and commissioning of complete Ash
Handling Plant for 2 x 500 MW Steam Generating
Units (for short 'the plant'). Such type of works
contract is known as 'On C.A. No. 1123 of
2003 Turnkey Basis'. Bids made by bidders were to
// 44 //
cover whole of the work as abovementioned. Bid
made by any person not covering the entire scope of
work was liable to be treated as incomplete and
could be rejected on that ground only. The bidder
was required to quote a lump sum price in its
proposal for the entire scope of work covered under
the bid documents. It further required that bidders
shall indicate the bid price in their home currency or
in US dollars."
8.15. In Director of Income Tax-II (supra), the apex
Court at paragraph-2 observed as follows:
"On 28.02.2006, the Oil and Natural Gas Company
("ONGC") awarded a "turnkey" contract to a
consortium comprising of the Respondent/Assessee,
i.e. Samsung Heavy Industries Co. Ltd. (a Company
incorporated in South Korea), and Larsen & Toubro
Limited, being a contract for carrying out the "Work",
inter alia, of surveys, design, engineering,
procurement, fabrication, installation and
modification at existing facilities, and start-up and
commissioning of entire facilities covered under the
'Vasai East Development Project' ("Project").
8.16 Therefore, on the basis of the performance
certificate issued by SJVN Ltd. in favour of M/s. BHEL-
opposite party no.4 and taking into consideration the red
herring prospectus, there is no iota of doubt that opposite
party no.4-M/s. BHEL has got the experience in executing a
contract on turnkey basis. Therefore, the objection so raised
by the petitioner cannot sustain in the eye of law.
8.17 In the proceeding dated 22.03.2022, the PSC of
the OPTCL recommended five bids as being techno-
// 45 //
commercially compliant and the committee recommended
for opening of the price bids. On 30.03.2022, the price bid
for the NIT bearing CPC-49/2021-22 was opened. Fifty
percent of the responsive bidders, i.e., minimum three were
allowed to participate in the e-Reverse Auction held
thereafter, on 07.04.2022. The details of the price after the
e-Reverse Auction are as under:-
(Page 146 of the Brief)
Details of Price after e-RA.
Name of Initial Evaluated Price after e- Tendered %
the Bidder Price including Reverse Auction estimated cost deviation
GST (Price in INR) including GST (including GST) after e-
(Price in INR) (Price in INR) Reverse
Auction.
(i) M/s. 2,10,45,41,526.70 2,09,82,28,002.70 2,00,31,49,600.00 (+) 4.75
Bharat (L1)
Heavy
Electrical
Ltd
(ii) M/s. 2,21,52,65,754.72 2,10,13,84,814.70 2,00,31,49,600.00 (+) 4.9
L&T Ltd. (L2)
(iii) M/s. 2,14,66,82,726.56 2,00,31,49,600.00 + 7.17
Siemens (L3)
Ltd. JV
with A.K.
Das
Associates
Ltd.
The above price as per bidding condition is inclusive of all taxes & duties under
Works Contract @ 18% GST.
8.18 The petitioner, along with its lead partner M/s
Seimens Ltd., was given opportunity to make the lowest bid
by lowering their quoted price, but they did not do so.
// 46 //
8.19. Taking into consideration the aforesaid e-Reverse
Auction, the PSC of OPTCL on 27.06.2022 recommended for
issuance of LoA in favour of M/s. BHEL-opposite party no.4
vide Annexure-L/1, basing upon which the Board of
Directors on 16.07.2022 approved the proposal for award of
LoA in favour of M/s. BHEL-opposite party no.4 on turnkey
contract basis as recommended by the PSC. Since the
order value of the project was more than Rs.100 crore,
necessary approval of the State Government was sought for.
8.20 In view of the aforesaid provision, it is made clear
that M/s. BHEL-opposite party no.4 satisfies the
requirement of Clause-4.1.1 of the NIT. Thereby, the
objection so raised by the petitioner cannot have any
substance. As a result, the writ petition cannot sustain.
Issue No.1 is accordingly answered against the petitioner.
9. Issue No. 2.
It is evident that after the evaluation of the
techno commercial bid, the petitioner and M/s. BHEL-
opposite party no.4 were qualified along with three others.
The PSC in its proceeding dated 22.03.2022 had
// 47 //
recommended for opening of the price bids and accordingly
the price bid was opened on 30.03.2022. Out of the 50% of
the responsive bidders, minimum three were allowed to
participate in the e-Reverse Auction held on 07.04.2022.
But neither the petitioner nor his lead partner M/s Seimens
Ltd., even after affording opportunity to them to make the
lowest bid by lowering their quoted price, does so. In view of
the table quoted in the foregoing paragraphs it is made clear
that since the petitioner and his lead partner M/s Seimens
Ltd. did not participate in the e-Reverse Auction, it has no
locus to challenge the same by filing the present writ
petition. As such, at the behest of the petitioner, the writ
petition cannot sustain.
9.1 In National Highways Authority (supra), the
apex Court at paragraph-20 of the judgment held as
follows:-
"While considering the relief claimed by the
respondent (claimant), the same should have been
tested on the touchstone of the principle governing
the tender process, especially when the validity of
the tender document has not been put in issue or
challenged before any competent forum. Going by the
terms and conditions in the tender documents, as
already alluded to in paragraph 8 above, there is no
tittle of doubt that the right of the claimant
(respondent) to match the bid of L-1 or to exercise
// 48 //
ROFR would come into play only if the respondent
was to participate in the tender process pursuant to
the notice inviting tenders from the interested
parties. The objective of tender process is not only to
adhere to a transparent mechanism but to encourage
competition and give equal opportunity to all
tenderers with the end result of getting a fair offer or
value for money. The plain wording of the eligibility
clause in the tender documents and the incidental
stipulations make it explicit that the respondent was
required to participate in the tender process by
submitting its sealed bid (technical and financial).
The fact that a deeming clause has been provided in
the tender document that if the respondent was to
participate in the bidding process, it shall be deemed
to fulfill all the requirements of the tender clauses 3
to 6 of the RFP, being the existing concessionaire of
the Project, does not exempt the respondent from
participating in the tender process; rather the tenor
of the terms of the documents made it obligatory for
the respondent to participate in the tender process to
be considered as a responsive bidder, along with
others. Having failed to participate in the tender
process and, more so, despite the express terms in
the tender documents, validity whereof has not been
challenged, the respondent cannot be heard to
contend that it had acquired any right whatsoever."
9.2 In the judgment rendered in the case of Pratap
Chandra Sahu (supra), of which one of us (Dr. Justice B.R.
Sarangi) was the author, this Court held that if the
petitioner does not choose to participate in the same, at his
behest, the benefit sought cannot be extended and no
direction can be issued for cancellation of such E-Tender
issued by opposite party no.3 in Annexure-2.
// 49 //
9.3 Therefore, this Court unhesitatingly comes to a
conclusion that the petitioner has no locus to assail the
settlement of contract in favour of opposite party no.4.
9.4 In Patel Engineering (supra), the apex Court at
paragraph-25 of the judgment observed as follows:-
"The controversy in this case has arisen at the
threshold. It cannot be disputed that this is an
international competitive bidding which postulates
keen competition and high efficiency. The bidders
have or should have assistance of technical experts.
The degree of care required in such a bidding is
greater than in ordinary local bids for small works. It
is essential to maintain the sanctity and integrity of
process of tender/bid and also award of a contract.
The appellant, respondent Nos.1 to 4 and respondent
Nos.10 & 11 are all bound by the ITB which should be
complied with scrupulously. In a work of this nature
and magnitude where bidders who fulfill pre-
qualification alone are invited to bid, adherence to the
instructions cannot be given a go-bye by branding it
as a pedantic approach otherwise it will encourage
and provide scope for discrimination, arbitrariness
and favoritism which are totally opposed to the Rule
of law and our Constitutional values."
On the basis of the facts and law, as discussed above, this
Court has already come to a conclusion that the selection of
M/s. BHEL-opposite party no.4 is in consonance with the
Clause-4.1.1 of the NIT. Therefore, the ratio decided in the
case of Patel Engineering (supra) has no application to the
present context.
// 50 //
9.5 Similarly, in Kanhaiya Lal Agrawal (supra) at
paragraph-5 of the judgment, the apex Court observed that
the Court is normally reluctant to intervene in matters of
entering into contracts by the Government, but if the same
is found to be unreasonable, arbitrary, mala fide or is in
disregard of mandatory procedures, the Court will not
hesitate to nullify or rectify such actions. It is the settled
law that when an essential condition of tender is not
complied with, it is open to the person inviting tender to
reject the same. Whether a condition is essential or
collateral could be ascertained by reference to consequence
of non-compliance thereto. If non-fulfillment of the
requirement results in rejection of the tender, then it would
be essential part of the tender otherwise it is only a
collateral term. This legal position has been well explained
in G.J.Fernandez vs. State of Karnataka & Ors., 1990(2)
SCC 488. Even if this contention is taken into
consideration, as urged by the learned Senior Counsel
appearing for the petitioner, by applying the above ratio to
the present context the same cannot justify to nullify the
// 51 //
contract awarded in favour of M/s. BHEL-opposite party
no.4.
9.6 In Poddar Steel (supra), the ratio decided in the
case of G.J. Fernadez (supra) has also been taken note of.
Since this Court has already held against the petitioner, the
judgment so cited by learned Senior Counsel for the
petitioner does not have any application to the present
context.
9.7 In Uflex Limited (supra), the judgment cited by
learned Senior Counsel appearing for opposite party no.1,
the apex Court referring to Jagdish Mandal v. State of
Orissa, (2007) 14 SCC 517 at paragraph-2 of the judgment
observed as follows:-
"The judicial review of such contractual matters has
its own limitations. It is in this context of judicial
review of administrative actions that this Court has
opined that it is intended to prevent arbitrariness,
irrationality, unreasonableness, bias and mala fide.
The purpose is to check whether the choice of
decision is made lawfully and not to check whether
the choice of decision is sound. In evaluating tenders
and awarding contracts, the parties are to be
governed by principles of commercial prudence. To
that extent, principles of equity and natural justice
have to stay at a distance."
// 52 //
Further, referring to Tata Cellular v Union of India,
(1994) 6 SCC 651, the apex Court came to a conclusion at
paragraph-42 to the following effect:-
"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 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 [36]
more cumbersome. We have already noted that
element of transparency is always required in such
tenders because of the nature of economic activity
carried on by the State, but the contours under which
they are to be examined are restricted as set out in
Tata Cellular26 and other cases. 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."
9.8 In Utkal Suppliers (supra), the judgment of
which was authored by one of us (Dr. Justice B.R. Sarangi),
at paragraph-21 of the said judgment it was observed as
follows:-
"Coming to the power of judicial review in the
matters relating to tenders or award of contracts, it
is to be borne in mind some special features. A
contract is a commercial transaction. Evaluating
tenders and awarding contracts are essentially
// 53 //
commercial functions. Principles of equity and
natural justice stay at a distance. If the decision
relating to award of contract is bona fide and is in
public interest, courts will not, in exercise of power of
judicial review, interfere even if a procedural
aberration or error in assessment or prejudice to a
tenderer, is made out. The power of judicial review
will not be permitted to be invoked to protect private
interest at the cost of public interest, or to decide
contractual disputes. The tenderer or contractor with
a grievance can always seek damages in a civil
Court. Attempts by unsuccessful tenderers with
imaginary grievances, wounded pride and business
rivalry, to make mountains, out of molehills of some
technical/procedural violation or some prejudice to
self, and persuade courts to interfere by exercising
power of 36 judicial review, should be resisted. Such
interferences either interim or final, may hold up
public works for years, or delay relief of succour to
thousand and millions and may increase the project
cost manifold. Therefore, a Court before interfering in
tender or contractual matters in exercise of power of
judicial review may very cautious and as such, the
scope of judicial review to award of contract has
been considered by the apex Court in various
judgments."
9.9 Therefore, while exercising power of judicial
review, the apex court has already set up the principle,
which has been taken note of in Sterling Computers Ltd.
v. M & N Publications Ltd. (1993) 1 SCC 445; Raunaq
International Ltd. v. I.V.R. Construction Ltd. (1999) 1
SCC 492; Air India Ltd. v. Cochin International Airport
Ltd. (2000) 2 SCC 617; Assn. of Registration Plates v.
Union of India (2005) 1 SCC 679; B.S.N. Joshi & Sons
Ltd. v. Nair Coal Services Ltd. (2006) 11 SCC 548 : (2006)
// 54 //
11 Scale 526; Michigan Rubber (India) Limited v. State
of Karnataka, (2012) 8 SCC 216; Maa Binda Express
Carrier v. North East Frontier Railway, (2014) 3 SCC
760.
9.10 In Gammon India Limited (supra), referring to
paragraphs- 28, 30 and 31, it was observed by the apex
Court that New Horizons Ltd v. Union of India, (1995) 1
SCC 478, recognizes a joint venture to be a legal entity in
the nature of a partnership of the constituent companies.
The partnership concept in relation to a joint venture is to
be accepted then the joint venture could be treated as a
`legal entity', with the character of a partnership.
9.11 In Consortium of Thermopads (supra), the apex
Court at paragraph-14 of the judgment observed as
follows:-
"14. In view, (Me principles of law laid down by the
apex Court, as discussed above, it is made clear that
the apex Court has time and again put restriction
with regard to the interpretation given to the
conditions of tender document and, as such, it has
been held that unless there is mala fide or perversity
in the understanding or appreciation or the
application of terms and conditions of the tender
documents, constitutional Courts should not interfere
with the interpretation given to such tender
documents. The apex Court has given a caution with
// 55 //
regard to exercise of the power of judicial review and
laid down the law stating that exercise of power of
judicial review would be called for if the approach is
arbitrary or mala fide or-procedure adopted is meant
to favour one. The decision making process should
clearly show that the said maladies are kept at bay.
But where a decision is taken by the Tendering
Authority, which is manifestly in consonance with
the language of the tender document or sub-serves
the purpose for which the tender is floated, the Court
should follow the principle of restraint. More so, the
Tendering Authority, who is the author of the tender
document, is competent person to interpret the
conditions of the tender document and, as such the
Constitutional Court should not interfere with the
interpretation given by the Tendering Authority.
Thus, this Court is of the firm opinion that the power of
judicial review being limited one, so far as tender matters
are concerned, in exercise of the same to the present facts,
the writ petition is not maintainable at the instance of the
present petitioner.
9.12 In view of the foregoing discussions, the
petitioner has no locus to file the writ petition and at his
behest the writ petition is not maintainable. Accordingly
issue no.2 is answered against the petitioner.
10. Issue No.3.
In view of the foregoing discussions, it is made
clear that the petitioner having forgone his right by not
participating in e-Reverse Auction, at his behest the writ
// 56 //
petition cannot sustain. Apart from that, the petitioner is
not the person aggrieved so as to approach this Court in
exercise of extraordinary jurisdiction under Article 226 of
the Constitution of India. Consequentially, this issue is also
answered against the petitioner.
11. On the basis of the facts and law, as discussed
above, since all the issues have been answered against the
petitioner, this Court is of the considered view that the writ
petition merits no consideration and the same stands
dismissed. However, there shall be no order as to costs.
(DR. B.R. SARANGI)
JUDGE
B.P. SATAPATHY. I agree.
(B.P. SATAPATHY)
JUDGE
Orissa High Court, Cuttack
The 2nd December, 2022, Arun/GDS
