Orissa High Court
Afr vs State Of Odisha And Others ..... Opp. ... on 12 December, 2023
Author: B.R. Sarangi
Bench: B.R. Sarangi
ORISSA HIGH COURT: CUTTACK
W.P.(C) NO. 32454 OF 2023
In the matter of an application under Articles 226 and
227 of the Constitution of India.
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AFR
Rabi Narayan Sahoo ..... Petitioner
-Versus-
State of Odisha and others ..... Opp. Parties
For Petitioner : Mr. P.K. Rath, Senior Advocate
along with M/s S. Rath, A.
Behera, S.K. Behera, S. Das,
P.K. Basantia, C. Purohit, R.
Panigrahi and A. Rout,
Advocates.
For Opp. Parties : Mr. P.P. Mohanty,
Addl. Government Advocate
P R E S E N T:
THE HONOURABLE ACTING CHIEF JUSTICE DR. B.R. SARANGI
AND
THE HON'BLE MR. JUSTICE MURAHARI SRI RAMAN
Date of hearing: 06.12.2023 :: Date of judgment:12.12.2023
DR. B.R. SARANGI, J. The petitioner, who is a 'B' class
contractor and subsequently upgraded to 'A' class on
04.12.2009, has filed this writ petition seeking to quash
the letter no.3376 dated 15.09.2023 under Annexure-1,
whereby his technical bid has been rejected by the Chief
Construction Engineer, Rural Works Circle, Kendrapara-
Jajpur on the ground "disqualified due to insufficient
similar nature of work", and to issue direction to the
opposite parties to treat the petitioner's technical bid as
valid and open the financial bid of the petitioner and
consider the same along with others.
2. The factual matrix of the case, in brief, is that
the petitioner, being upgraded from 'B' class to 'A' class
contractor on 04.12.2009, constituted a partnership firm
in the name and style as "M/s BRS Construction" on
18.10.2013. During 2014-15, vide order dated
21.08.2014, the license of the petitioner was upgraded
from 'A' class to 'Special' class contractor. Subsequent to
such up-gradation, the partnership firm, of which the
petitioner was a partner, wanted to be a part of the
petitioner's special class license. For the said purpose, the
petitioner, as Managing Partner, submitted an application
to substitute the name of M/s BRS Construction, in place
of the petitioner, as a special class contractor and to issue
the license. Accordingly, M/s BRS Construction was
issued with special class license with effect from
19.04.2021. Thereafter, the petitioner undertook several
construction projects under the license of M/s BRS
Construction, in which he is the Managing Partner.
2.1 Partnership is not a justice person unlike a
company incorporated under the Companies Act. On the
other hand, a partnership is identified through its
partners like any other individuals. On account of dispute
among the partnership, on 10.04.2022, the petitioner
applied for cancellation of license in the name of
partnership firm, i.e., M/s BRS Construction. Consequent
upon such application, the Engineer-in-Chief (Civil),
Works Department, vide order dated 12.05.2022,
cancelled the special class license in favour of the
partnership firm. After cancellation of license, the
petitioner applied for issuance of a 'B' class license in his
favour, which was issued on 25.11.2022.
2.2 The Chief Construction Engineer, Rural Works
Circle, Kendrapara-Jajpur issued e-procurement notice
dated 09.08.2023 under Annexure-8 inviting tenders for
construction of several projects under it. The said tender
call notice was followed by two corrigenda dated
17.08.2023 and 25.08.2023 under Annexures-9 and 10
respectively. Pursuant thereto, the petitioner submitted
his bid for the work "Construction and Maintenance of
NH-16 to Kantabania via Sabar Sahi Neulpur Road under
MMSYTRIP" under R.W. Division-II, Jajpur at Jaraka. As
per the conditions stipulated in the Detailed Tender Call
Notice (DTCN), under the checklist to be filled up by the
bidder at sl.no.6 it was provided that "Works Experience
& Annual Turn Over" was to be furnished with reference
to clause-14 of the DTCN. The petitioner submitted
experience certificate in respect of the work, which was
executed during his continuance as the special class
contractor, as a partner of M/s BRS Construction, a
partnership firm. But, the Chief Construction Engineer,
Rural Works Circle, Kendrapara-Jajpur, without assigning
any reason and without applying its mind, rejected the
bid of the petitioner vide Annexure-1 dated 15.09.2023 on
the ground "disqualified due to insufficient similar nature
of work". Hence, this writ petition.
3. Mr. P.K. Rath, learned Senior Counsel,
appearing along with Ms. Aroma Rout, learned counsel for
the petitioner, vehemently contended that though the
petitioner furnished all information with regard to
execution of similar nature of work worth 75% of the
estimated cost put to tender during any three financial
years taken together of the last preceding five years
excluding the current financial year, the Chief
Construction Engineer, Rural Works Circle, Kendrapara-
Jajpur did not take the same into consideration and
rejected the technical bid of the petitioner without
applying his mind in proper perspective. It is further
contended that technical bid of the petitioner has been
rejected on the plea that the petitioner has got work
experience from a partnership firm of a special class
contractor, which cannot be considered as a 'B' class
contractor, subsequently upgraded to 'A' class contractor.
Thereby, the Chief Construction Engineer, Rural Works
Circle, Kendrapara-Jajpur has committed gross error in
evaluating the technical bid, so far it relates to the
petitioner and, as such, the same is arbitrary,
unreasonable and contrary to the provisions of law. To
substantiate his contention, he has relied upon the
judgments of the apex Court in the cases of Ganpati RV-
Talleres Alegria Track Private Limited v. Union of
India and another, (2009) 1 SCC 589; and Maa
Nabadurga Construction v. Saroj Kumar Jena and
others, 2015 SCC OnLine SC 1933.
4. Mr. P.P. Mohanty, learned Addl. Government
Advocate appearing for the State-opposite parties
although admitted the factum of issuance of tender call
notice and participation of the petitioner in the tender
process, so far as the work in question is concerned, but
contended that during evaluation the petitioner did not
submit work experience certificate of similar nature of
work in his own name. Rather, he has submitted work
experience certificate of similar nature of work in the
name of M/s BRS Construction, which is a 'Special Class'
contractor, whereas the tenders were invited from 'A & B'
class contractors only. It is thus contended that since the
petitioner did not submit any experience certificate with
regard to execution of similar nature of work in his name,
the tender committee decided to disqualify his bid "due to
insufficient similar nature of work". Consequentially, no
illegality or irregularity has been committed by the
authority in rejecting the technical bid of the petitioner
assigning specific reason "disqualified due to insufficient
similar nature of work". It is further contended that after
uploading of the list of qualified bidders, the financial bids
of the said tender notice were opened on 21.09.2023 at
4.30 P.M. After opening of financial bids, it was found
that Satyabrata Jena and Sudam Charan Sethy were
qualified as first lowest tenderers in respect of two works,
including the work in question and, therefore, the tender
committee decided to award the work in favour of them.
As such, the tender for the above two works has been
ascertained vide office letter no.3735 dated 06.10.2023
and letter no.4335 dated 04.11.2023 respectively and
forwarded to the same to the Superintending Engineer,
R.W. Division No.2, Jajpur at Jarka for drawal of
agreement. But due to pendency of this case, no further
progress has been made. Consequentially, he sought for
dismissal of the writ petition.
5. This Court heard Mr. P.K. Rath, learned Senior
Counsel appearing along with Ms. Aroma Rout, learned
counsel for the petitioner and Mr. P.P. Mohanty, learned
Addl. Government Advocate appearing for the State-
opposite parties. Since pleadings have been exchanged
between the parties, with the consent of learned counsel
for the parties this writ petition is being disposed of finally
at the stage of admission.
6. For just and proper adjudication of the case,
relevant provisions of the Detailed Tender Call Notice are
extracted hereunder:-
"14. Qualification Criteria on general experience.
The Applicant shall meet the following minimum criteria
failing which the bid shall be summarily rejected:
Eligibility Criteria:
The eligibility criteria for participation in this tender are
given below. The tenderer (s) should go through these
eligibility criteria before purchasing the tender documents.
Tenderer (s) not fulfilling the eligibility criteria and submit
the tender, can do so at their own risk, as the tendere will
summarily rejected.
(a) The intending tenderer (s) should have to submit an
affidavit regarding correctness of information in schedule.
F. Non furnishing of the scanned copy of required
affidavit, the bid document will be summarily rejected.
The intending tenderer (s) should also have not abandoned
any work of similar nature nor should their contract have
been rescinded during the last five years and affidavit to
that effect is also to been closed as Schedule E.
(b) An Undertaking for installation of Hot Mix Plant within
60 km. An undertaking in shape of declaration by
the bidder should be uploaded with the bid documents
mentioning there in that, he will procure the material
mix from the Hot Mix Plant established within 63km
from the work site before execution of the work, failing
which the bid will be summarily rejected.
(c) The intending tenderer(s) should have the valid
Registration Certificate as on date, of the required class
as mentioned in Col-5 of the Annexure in NIT.
(d) The intending tenderer (s) should have up to date, GSTIN
Certificate & process PAN CARD, Labour License. No
undertaking forwards GSTIN & PAN Card is acceptable.
i. The intending tenderer (s) should have executed
similar nature of work worth 75% of the
estimated cost put to tender during any three
financial years taken together of the last
preceding five years excluding the current
financial year. In case of Contract spanning for
more than one financial year, the breakup of
execution of work in each of financial year
should be furnished A certificate to this effect
must been closed from the officer not below the
rank of Executive Engineer to be enclosed as
Schedule -D.
ii. The intending tenderer(s) should have the total
financial turn over in respect of Civil
Engineering works of an amount not less than
the amount put to tender during any 3 (three)
financial years taken together of the last
preceding five financial years (excluding the
current financial year). The financial turn over
certificate for Civil Engineering works should be
submitted from the Charted Accountant showing
clearly the financial turn over financial year
wise with UDIN as per schedule - H."
7. On perusal of the aforementioned provisions, it
is made clear that the intending tenderer (s) should have
executed similar nature of work worth 75% of the
estimated cost put to tender during any three financial
years taken together of the last preceding five years
excluding the current financial year. But in the said
provisions it is nowhere stated that the experience
certificate should be in the name of the bidder or in the
name of individual. On the other hand, the petitioner has
all through been contending that he has got experience of
a partnership firm, of which he is the Managing Partner,
which fully satisfied the requirement of the tender
conditions. More so, the conditions stipulated in the
tender documents, do not indicate that the experience of
the partnership firm will be excluded from consideration.
Rather, the status of the partnership is that of an
individual and partnership firm is not a juristic person, so
as to have an independent status. Therefore, the
experience certificate submitted by the petitioner of a
partnership firm, of which he was the Managing Partner,
will be counted towards his experience for all practical
purposes. The question raised by the opposite parties is
that whether the experience certificate of a special class
contractor will be considered valid for the tender invited
for 'A' and 'B' class contractor. On perusal of the
conditions stipulated in the DTCN, it is revealed that
there is no such condition that experience certificate of
any particular class of contractor is to be filed. In absence
of any such stipulation in the tender notice, the
experience of the petitioner, while he was a special class
contractor, cannot be rejected on the ground that the
experience certificate was not of the similar class of
contractor, for which the tender was invited. As such, in
absence of any such stipulation in the tender notice, the
authority cannot act on the basis of conjectures and
surmises, which would amount to re-writing the tender
conditions, which is not permissible under law.
8. Though it is admitted fact that there was
dispute between the partners, for which the petitioner, on
10.04.2022, applied for cancellation of special class
license issued on the name of M/s BRS construction, but
on perusal of document, which has been annexed as
Annexure-5 to the writ petition, it is made clear that the
petitioner applied for cancellation of the special class
license and there is nothing available on record to show
that the experience gained by the petitioner as Managing
Partner of the partnership firm shall not be counted for
participating in the bid. Thereby, the petitioner, who
furnished the experience certificate, relying upon the
experience gained as a special class contractor, for the
purpose of participation in the bid, having 'B' class license
and upgraded to 'A' class, that ipso facto cannot deprive
the petitioner of the benefit of participating in the bid.
9. In Maa Nabadurga Construction (supra), the
apex Court, in paragraph-11 of the judgment, held as
under:-
"11. This court was of the view that the experience of a
joint venture is akin to the experience of a partnership
and further observed as under: "The expression "Joint
venture" is more frequently used in the United States. It
connotes a legal entity in the nature of a partnership
engaged in the Joint undertaking of a particular
transaction for mutual profit or an association of
persons or companies jointly undertaking some
commercial enterprise wherein all contribute assets and
share risk. It requires a community of interest in the
performance of the subject-matter, a right to direct and
govern the policy in connection therewith, and duty,
which may be altered by agreement, to share both in
profit and losses."
10. In New Horizons Limited v. Union of India,
(1995) 1 SCC 478, the apex Court held as under:-
"While considering the requirement regarding
experience it has to be borne in mind that the said
requirement is contained in a document inviting offers
for a commercial transaction. The terms and conditions
of such a document have to be construed from the
standpoint of a prudent businessman. When a
businessman enters into a contract whereunder some
work is to be performed he seeks to assure himself about
the credentials of the person who is to be entrusted with
the performance of the work. Such credentials are to be
examined from a commercial point of view which means
that if the contract is to be entered with a company he
will look into the background of the company and the
persons who are in control of the same and their
capacity to execute the work. He would go not by the
name of the company but by the persons behind the
company. While keeping in view the past experience he
would also take note of the present state of affairs and
the equipment and resources at the disposal of the
company."
11. In view of the above, there is no iota of doubt
that 'experience' is something which cannot be an asset of
the firm and, therefore, not capable of being attributed to
a firm is not correct. It is settled law that a partnership
has been held to be a compendious name for its partners
and that experience is a human attribute which does not
form part of the assets or property of the firm in the usual
sense.
12. In Black's Law Dictionary, the meaning of
'experience' has been defined to the following effect:-
"Experience- A state, extent, or duration of being
engaged in a particular study or work; the real life as
contrasted with the ideal or imaginary. A word implying
skill, facility, or practical wisdom gained by personal
knowledge, feeling and action, and also the course or
process by which one attains knowledge or wisdom."
13. In Ganapati RV-Talleres Alegria Track
Private Limited (supra), the apex Court, in paragraph-23
of the judgment, held as under:-
"23. Even if it be assumed that the requirement
regarding experience as set out in the advertisement
dated 22-4-1993 inviting tenders is a condition about
eligibility for consideration of the tenders, though we
find no basis for the same, the said requirement
regarding experience cannot his name only. It is
possible to visualize a situation where a person having
past experience has entered into a partnership and the
tenderer has been submitted in the name if the
partnership firm which may not have any past
experience in its own name. That does not mean that the
earlier experience of one of the partners of the firm
cannot be taken into consideration. Similarly, a
company incorporated under the Companies Act having
past experience may undergo reorganization as a result
of merger or amalgamation with another company
which may have no such past experience and the tender
is submitted in the name of the reorganized company. It
could not be the purport of the requirement about
experience that the experience of the company which has
merged into the reorganized company cannot be taken
into consideration because the tender has not been
submitted in its name and has been submitted in the
name of the reorganized company which does not have
experience in its name. Conversely there may be a split
in a company and persons looking after a particular
field of the business of the company form a new company
after leaving it. The new company, though having
persons with experience in the field, has no experience
in its name while the original company having
experience in its name lacks persons with experience.
The requirement regarding experience does not mean
that the offer of the original company must be
considered because it has experience in its name though
it does not have experienced persons with it and ignore
the offer of the new company because it does not have
experienced persons with it and ignore the offer of the
new company because it does not have experience in its
name thought it has persons having experience in the
field. While considering the requirement regarding
experience it has to be borne in mind that the said
requirement is contained in a document inviting offers
for a commercial transaction. The terms and conditions
of such a document have to be construed from the stand
point of a prudent businessman. When a businessman
enters into a contract whereunder some work is to be
performed he seeks to assure himself about the
credentials of the person who is to be entrusted with the
performance of the work. Such credentials are to be
examined from a commercial point of view which means
that if the contract is to be entered with a company he
will look means that if the contract is to be entered with
a company he will look into the background of the
company and the persons who are in control of the same
and their capacity to execute work. He would go not by
the name of the company but by the persons behind the
company. While keeping in view the past experience he
would also take note of the present state of affairs and
the equipment and resources at the disposal of the
company. ....."
14. In view of the law, as discussed above, it is
made clear that where a person, having past experience,
has entered into partnership and the tender has been
submitted in the name of partnership, which may not
have any past experience, that does not mean, earlier
experience of one of the partners of the firm, cannot be
taken into consideration. From the ratio decided by the
apex Court, as mentioned supra, it is made clear that the
experience gained by the petitioner from the erstwhile
special class contractor-M/s BRS Construction, a
partnership firm, being remained as Managing Partner,
cannot be brushed aside to declare him disqualified from
the technical bid. Thereby, the technical evaluation
committee has committed gross error apparent on the face
of record in rejecting the bid of the petitioner on the
ground "disqualified due to insufficient similar nature of
work". If the work undertaken by the petitioner as
Managing Partner of the erstwhile special class
contractor-M/s BRS Construction had been taken into
account for the purpose of determination of his work
experience, that would have been more than 75% of the
estimated cost of the tender in question, and his bid could
not have been declared as "disqualified due to insufficient
similar nature of work".
15. In the above view of the matter, the inevitable
conclusion is that the view taken by the technical
evaluation committee, that the petitioner is disqualified
due to insufficient similar nature of work and, therefore,
not fulfilled the eligibility criteria, is not correct. Thereby,
this Court directs the technical evaluation committee to
consider the technical bid of the petitioner and allow him
to participate in the financial bid, along with two others
who have been selected, and take a final decision thereon.
16. In the result, the writ petition is allowed.
However, there shall be no order as to costs.
..................................
DR. B.R. SARANGI,
ACTING CHIEF JUSTICE
M.S. RAMAN, J. I agree.
..................................
M.S. RAMAN,
JUDGE
Orissa High Court, Cuttack
The 12th December, 2023, Ashok
Signed by: ASHOK KUMAR JAGADEB
Location: HIGH COURT OF ORISSA
Date: 13-Dec-2023 18:06:50
