Rajeev Kumar vs The State Of Bihar
2023 Latest Caselaw 5412 Patna

         IN THE HIGH COURT OF JUDICATURE AT PATNA
                    Civil Writ Jurisdiction Case No.11234 of 2023
     ======================================================

Rajeev Kumar Son of Late Chandradeep Singh Resident of Tothan Lalganj, P.S. Lalganj, District-Vaishali, Bihar.

... ... Petitioner/s Versus

1. The State of Bihar through the Principal Secretary, Rural Works Department, Government of Bihar, Patna.

2. The Engineer-In-Chief, Rural Works Department, Government of Bihar, Patna.

3. The Chief Engineer, Rural Works Department, Government of Bihar, Patna.

4. The Superintending Engineer, Rural Works Department, Works Circle, Muzaffarpur Cum Chairman Technical Bid Evaluation Committee, Muzaffarpur, Bihar.

5. The Executive Engineer, Rural Works Department, Works Division-Mahnar, District Vaishali, Bihar.

... ... Respondent/s ====================================================== Appearance :

For the Petitioner/s : Mr. Prabhat Ranjan, Advocate For the Respondent/s : Mr. P.K. Shahi, Advocate General assisted by Mr. Anjani Kumar, AAG 4 ====================================================== CORAM: HONOURABLE MR. JUSTICE P. B. BAJANTHRI and HONOURABLE MR. JUSTICE ARUN KUMAR JHA

CAV JUDGMENT

(Per: HONOURABLE MR. JUSTICE P. B. BAJANTHRI)

Date : 18-10-2023

The petitioner has prayed for the following relief/reliefs:

"(i) Quashing of the Notice Inviting Tender No. RWD/PMGSY/HQ/ET/23-24/06 issued by the Engineer-In-Chief, Rural Works Department in so far as it relates to the work of "T19- Mahnar Railway Station Bajrangwali Chowk Se To Salha Chowk NH 103 Tak at Serial No. 97" by which Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

without complying the direction of this Hon'ble Court dated 24.07.2023 in CWJC No. 10068 of 2023, the aforesaid work has been readvertised;

(ii) Direction upon the respondents to cancel the tender process in connection with "T19 - Manhar Railway Station Bajrangwali Chowk Se To Salha Chowk NH 103 Tak at Serial No. 97" arising out of Notice Inviting Tender No. RWD/PMGSY? HQ/ET/23-24/06;

(iii) Direction upon the respondents to finalize the tender process followed by other formalities in connection with the first Notice Inviting Tender No. RWD/PMGSY/HQ/ET/22-23/34 dated 06.12.2022 for financial bid has also been opened; and

(iv) Restraining the Respondents from proceeding further and finalizing the Tender process arising out of Notice Inviting Tender No. RWD/PMGSY/HQ/ET/23-24/06 dated 28.07.2023 during the pendency of the present writ application and/or without the leave of this Hon'ble Court."

Brief facts of the case are as under:

2. The petitioner is one of the bidders to the NIT dated

06.12.2022 insofar as item No. 139 is concerned and name of

work is T 19 Mahnar Railway Station Bajrangwali Chowk Se To

Salha Chowk NH 103 Tak. He was held to be successful bidder in

the technical bid evaluation held on 01.02.2023. Further, in the

financial bid, he has been declared as L1 on 09.02.2023 having

quoted a price 0.77 % below the schedule rate for an amount of Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

Rs. 10,05,49,535.00/-. The estimated cost of the work is sum of

Rs. 10,13,29,774.28/-. On 14.07.2023, Engineer-in-Chief

cancelled the tender while assigning the reason that 'in the

interest of administrative'. The petitioner questioned the

cancellation of tender dated 14.07.2023 in C.W.J.C. No. 10068 of

2023.

3. This Court has set aside the order dated 14.07.2023

on 24.07.2023 while remanding the matter to pass fresh order

insofar as cancellation of tender while assigning the reasons.

Before complying the order of this Court dated 24.07.2023, fresh

tender was issued on 28.07.2023 which is the subject matter of the

present writ petition.

4. On 31.07.2023 a reasoned order has been passed

insofar as cancellation of tender in the light of the order of this

Court dated 24.07.2023 passed in C.W.J.C. No. 10068 of 2023.

The petitioner filed interlocutory application in questioning the

validity of the order dated 31.07.2023 by which earlier tender was

cancelled. Hence, the present writ petition.

Dates and events are as under:

  Sl.No.      Dates                                    Events
  1           06.03.2014 State Government evolved a policy while fixing the

minimum rates for the tenderers i.e. a ceiling of 10 % less than the rate of Bill of Quantity (BOQ), issued by the Road Construction Department, Government of Bihar.

Central Government evolved a scheme called Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

Pradhan Mantri Gram Sadak Yojana (hereinafter referred to as 'PMGSY') in the year 2015. The object of PMGSY

- III envisages consolidation of the existing rural road network by upgradation of existing through routes and major rural links that connect habitations to Gramin Agriculture Markets (GrAMs), Higher Secondary Schools and Hospitals and includes various linkages. 2 06.03.2014 Vide letter No. 2046, State of Bihar evolved a policy decision in respect of quoting minimum rates for the tenders that is ceiling of 10 % less than the rate of BOQ, issued by the Road Construction Department, Government of Bihar.

3 16.01.2020 Road Construction Department abolished quoting of minimum rates for the tenders i.e. ceiling of 10 % less than the BOQ.

4 29.11.2022 Project proposal of 236 roads have been sanctioned by Ministry of Rural Development, Government of India under PMGSY - III (Page II), 2022 - 2023.

5 02.12.2022 State Government issued brief letters while granting to administrative approval, tenders were invited for the 22.12.2022 aforementioned works. 06.12.2022 is one of the letter relates to the present case.

6 21.12.2022 In C.W.J.C No. 9941 of 2022, this Court has passed the following order "we stay the operation of the impugned notification dated 16.01.2020. We clarify that our order would operate only for such of those tenders, for which bids are yet required to be submitted".

Notification dated 16.01.2020 for abolition of minimum rates for the tenders i.e. on ceiling of 10 % less than the rate of Bill of Quantity meaning thereby earlier letter No. 2046 dated 06.03.2014 issued by the Road Construction Department, Government of Bihar was restored and it has to be given effect.

7 26.12.2022 Rural Works Department by its letter dated 26.12.2022 communicated to all the respective Executive Engineers to ensure compliance of the order of this Court dated 21.12.2022. This communication was shared with the Ministry of Rural Development, Government of India. 8 27.12.2022 State proceeded to issue tenders/re-tenders with the to conditions of minimum limit of quoted rate up to 10 % 17.02.2023 less than the BOQ for unawarded works of PMGSY - III by various letters.

9 24.02.2023 Ministry of Rural Development, Government of India informed that programme of PMGSY provides that any matter of tender of works sanctioned under PMGSY of States/UTs will follow the provisions prescribed in the Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

Standard Bid Document (SBD) issued by the National Rural Infrastructure Development Agency (NRIDA). It was further clarified in paragraph Nos. 4 and 6, they are as under:

4. In no case any variations would be allowed or any limits placed on the quantum of bid which can be submitted for a particular work in case of violation/deviation of States/UTs of the above SBD provisions, such work shall be frozen on OMMAS, and no payment would be allowed on OMMAS from PMGSY funds for such works.

6 (b) The award process of PMGSY works sanctioned to the State be kept in abeyance till matter is finally decided judicially.

10 09.05.2023 Ministry of Rural Development, Government of India intervened and so also added as respondent No. 10 in C.W.J.C. No. 9941 of 2022 vide order dated 09.05.2023. 11 06.07.2023 C.W.J.C. No. 9941 of 2022 in which 16.01.2020 order relating to withdrawal of 10 % minimum was dismissed. 12 14.07.2023 Ministry of Rural Development, Government of India directed that there should be no impediment to process of tender for PMGSY works as per the Standard Bidding Document (SBD) norms of the programme. State Government of Bihar is requested to take required action expeditiously as per the SBD of PMGSY.

13 14.07.2023 On receipt of communication from the Ministry of Rural Development, Government of India all tenders invited from 02.12.2022 to 17.02.2023 were cancelled on administrative reasons.

14 15.07.2023 Fresh tenders were issued (other than the subject matter of this case).

15 24.07.2023 The present writ petitioner - Rajiv Kumar filed C.W.J.C.

No. 10068 of 2023 connected with C.W.J.C. No. 10069 of 2023, C.W.J.C. No. 10126 of 2023 and C.W.J.C. No. 10125 of 2023 wherein cancellation of tender dated 14.07.2023 was subject matter and this Court set aside the order dated 14.07.2023 and remanded the matter to the Engineer-in-Chief, Rural Works Department, Bihar, Patna to proceed with fresh detailed reasoned/speaking order to be passed for cancellation of tender, if it is warranted.

16 31.07.2023 Engineer-in-Chief, Rural Works Department proceeded to pass a reasoned order insofar as cancellation of various tenders.

17 07.08.2023 Ministry of Rural Development, Government of India has set timeline of completion of PMGSY - III works as Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

31.03.2025.

On 07.08.2023 in C.W.J.C. No. 10966 of 2023 Rita Singh @ Reeta Singh vs. State of Bihar and others passed the following order "Re-tender dated 15.07.2023 shall not be processed till next date of hearing." 18 24.08.2023 In C.W.J.C. No. 12030 of 2023 in the case of Alok Kumar vs State of Bihar and Others, identical order was passed to that of order passed in C.W.J.C. No. 11271 of 2023.

19 01.09.2023 In C.W.J.C. No. 11234 of 2023 Rajiv Kumar vs. State of Bihar and others and connected matters, it is ordered that concerned respondents are hereby directed stall the re-tender process dated 28.07.2023 till the next date of hearing.

20 04.09.2023 In compliance of the order dated 01.09.2023 passed in C.W.J.C. No. 11234 of 2023 in the case of Rajiv Kumar vs. State of Bihar and other and connected cases, State of Bihar have taken a decision to not to open the bid.

5. Learned counsel for the petitioner submitted that

letter bearing No. 2046 dated 06.03.2014, relating to ceiling of 10

percent less than the rate of BOQ read with its withdrawal dated

16.01.2020 and order of this Court dated 06.07.2023 passed in

C.W.J.C. No. 9941 of 2022, is not applicable to the subject matter

of tender issued on 06.12.2022 read with evaluation of technical

bid dated 01.02.2023 wherein petitioner and others were

successful and further, financial bid was opened on 09.02.2023 in

which petitioner has been declared as L1. It is submitted that

subject matter of contract is one of the contract under PMGSY -

III.

6. The aforementioned policy decision of the State

Government dated 06.03.2014 and its withdrawn on 16.01.2020 is Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

not applicable to the case in hand, for the reasons that PMGSY -

III is covered by SBD document issued by National Rural

Infrastructure Development Authority (herein after referred to as

'NRIDA'). SBD of NRIDA does not stipulate the minimum limit

of 10 % less than the scheduled rate in the light of said policy

decision. On the other hand, bid pricing in SBD issued by NRIDA

is silent on the minimum limit of percentage to be quoted by the

bidder, therefore, the official respondent cannot take shelter of this

Court's decision dated 06.07.2023 passed in C.W.J.C. No. 9941 of

2022 and proceed to cancel the tender dated 06.12.2022 on

31.07.2023 and re-tender dated 28.07.2023.

7. It is further submitted that for cancellation of tender,

another reason assigned is that bid validity was for 90 days with

reference to last date of submission of tender, the same cannot be

good ground to cancel the tender dated 06.12.2022 in view of the

fact that technical bid evaluation was held on 01.02.2023 and

financial bid was concluded on 09.02.2023. It is also submitted

that another reason for cancellation is that tenders became six

months old and further Government of India brought certain

variations in standard of construction, in other words, ceiling

improvement in road construction which has resulted in increase

in cost of the tenders.

Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

8. Learned counsel for the petitioner submitted that yet

another reason is that tenders are six months older, therefore,

respondents have cancelled tenders may not be a good ground for

the reasons that technical bid as well as financial bid have attained

finality five months earlier to the proposed cancellation. It is

further submitted that if there are any change in standard of

construction, it is applicable to future tenders. Therefore, reasons

assigned for cancellation in the order dated 31.07.2023 are not

tenable. It is also submitted that respondents have discriminated in

cancelling the tender. In other words, some of the tender processes

prior to order of this Court dated 06.07.2023 passed in C.W.J.C.

No. 9941 of 2022 have been given effect. In this regard, he has

pointed certain documents like Annexure P - 19 to the connected

writ petition, which is delinked. Those documents are relating to

maintenance of roads constructed under PMGSY scheme.

9. It is submitted that EMD pursuant to NIT dated

06.12.2022 paid was refunded during the intervening period from

16.07.2023 to 22.07.2023. Such refund of EMD is not at the

behest of the petitioner. On the other hand, respondents on their

own deposited EMD amount in the petitioners' bank account.

Therefore, returning EMD amount at the behest of the respondents Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

would not be a hurdle in questioning the cancellation of tender

and re-tendering process.

10. Per contra the learned Advocate General submitted

that the present writ petition is not maintainable in view of the fact

that EMD amount furnished by the petitioner was refunded during

the period from 16.07.2023 to 27.07.2023. Re-tender process was

undertaken on 28.07.2023. Further, reasons have been assigned as

to why the tender notification issued on 06.12.2022 has been

cancelled. It is for the employer to take a decision as to whether

earlier NIT issued could be cancelled and whether to proceed with

re-tender or not. In the present case, reasons assigned are in the

guise of implementation of the order dated 21.12.2022 passed in

CWJC No. 9941 of 2022, validity is for 90 days from the last date

of submission of tender. The last date of submission of tender

being 16.01.2023 and it has not attained finality as on 14.07.2023,

the date on which initially NIT dated 06.12.2022 was cancelled.

Nodoubt 14.07.2023 cancellation of tender was subject matter of

CWJC No. 10068 of 2023 and it was quashed on 24.07.2023

which resulted in passing a fresh cacellation order on 31.07.2023

read with re-tender process dated 28.07.2023. It was also noticed

by the competent authority before cancellation that tender dated

06.12.2022 is six months old tender, in such an event the Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

authorities could proceed for re-tendering. That apart Central

Government has taken a policy decision on resurfacing and there

are certain changes in the standard of construction of the subject

matter road work. Therefore, there is no arbitrariness in the

impugned action of the respondents.

11. The question of discrimination in implementation of

certain NIT and cancellation of certain NIT is not a ground to

interfere. In fact there is no discrimination insofar as the present

case with reference to Annexure P - 13 series and Annexure P - 19

series furnished by the petitioner read with later document. The

later document is relating to maintenance of the roads which was

already constructed. Therefore, factual aspect of the matter of the

present case and giving effect to such of those NITs are relating to

maintenance of various roads. On this ground, there is no

discrimination. He also submitted that time and again Courts have

held that Courts shall not interfere unless and until there are

arbitrariness in the process of tendering and its consideration. In

the present case there are no arbitrariness in respect of any of the

action. Hence, petitioner has not made out a case. Consequently,

writ petition is liable to be dismissed.

12. Controversy in the present matter is whether principle

of arbitrariness or irrationality is attracted in cancelling the tender Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

dated 06.12.2022 on 31.07.2023 while re-tendering on 28.07.2023

or not?

13. Before adverting to the merits of the case, it is

necessary to take note of the general principles relating to

interference in a tender matter under Article 226 of the

Constitution of India. In a recent decision of the Apex Court in

the case of Tata Motors Limited Vs. BEST and others reported in

(2023) SCC Online SC (671) in paragraph-48, it is held as under:

"48. This Court being the guardian of fundamental rights is duty-bound to interfere when there is arbitrariness, irrationality, mala fides and bias.

However, this Court has cautioned time and again that courts should exercise a lot of restraint while exercising their powers of judicial review in contractual or commercial matters. This Court is normally loathe to interfere in contractual matters unless a clear-cut case of arbitrariness or mala fides or bias or irrationality is made out. One must remember that today many public sector undertakings compete with the private industry. The contracts entered into between private parties are not subject to scrutiny under writ jurisdiction. No doubt, the bodies which are State within the meaning of Article 12 of the Constitution are bound to act fairly and are amenable to the writ jurisdiction of superior courts but this discretionary power must be exercised with a great deal of restraint and caution. The courts must realise their limitations and the havoc which needless interference in commercial matters can cause. In contracts involving technical issues the courts should Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

be even more reluctant because most of us in Judges' robes do not have the necessary expertise to adjudicate upon technical issues beyond our domain. The courts should not use a magnifying glass while scanning the tenders and make every small mistake appear like a big blunder. In fact, the courts must give "fair play in the joints" to the government and public sector undertakings in matters of contract. Courts must also not interfere where such interference will cause unnecessary loss to the public exchequer. (See : Silppi Constructions Contractors v. Union of India, (2020) 16 SCC 489)"

14. Undisputed factual matrix are that the State

Government evolved a policy on 06.03.2014 while fixing

minimum rates for the tenderers i.e. ceiling of 10% less than the

rate of BOQ, issued by the Road Construction Department,

Government of Bihar. Central Government evolved a scheme

called 'PMGSY' in the year 2015. One of the scheme is road

construction projects and they were required to be implemented

by the State Government, whereas the Central Government is

funding to some extent and State Government is also contributing

certain funds. The State Government is required to execute

'PMGSY' projects in the light of the rate of standard bid

documents issued by the NRIDA. Therefore, the policy of the

State Government dated 06.03.2014 cited supra is not applicable

to 'PMGSY' projects. Therefore, withdrawal of State Policy Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

decision dated 06.03.2014 on 16.01.2020, the interim order dated

21.12.2022 passed in C.W.J.C. No.9941 of 2022 and, thereafter,

dismissal of C.W.J.C. No.9941 of 2022 on 06.07.2023 have no

bearing on the 'PMGSY' projects like in the present case of

'PMGSY' project vide NIT dated 06.12.2022 read with technical

bid evaluation dated 01.02.2023 and declaring the petitioner as L1

in the final bid on 09.02.2023.

15. No doubt, at given point of time while cancelling the

Tender Notification dated 06.12.2022 on 14.07.2023 and

31.07.2023, respondents have taken a decision that the policy

decision of the State Government dated 06.03.2014 read with its

withdrawal dated 16.01.2020, interim order dated 21.12.2022

passed in C.W.J.C. No.9941 of 2022 and its dismissal on

06.07.2023 have bearing to the extent that State Government

Policy dated 06.03.2014 is applicable as narrated in the

cancellation of tender dated 14.07.2023 read with 31.07.2023.

Later on, learned Advocate General fairly submitted that State

Policy dated 06.03.2014 is not applicable to the 'PMGSY' project

like the present one in the light of SBD issued by the NRIDA.

16. The other reasons for cancellation of tender are that

the tender is valid for 90 days only, six months older tender and it

has not attained its finality. There is some substance in reasons Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

assigned for cancellation of tender even though the one of the

reasons for cancellation, i.e., the event arising out of order dated

06.03.2014 may not favour the State Government. We find prima

facie there is no arbitrariness or irrrationality insofar as assigning

the reasons for cancellation of tender.

17. Learned Advocate General submitted that EMD

deposited by the petitioner and others have been refunded to the

respective bidders before re-tendering the subject matter of

'PMGSY' project. That apart, the petitioner has not protested the

same and he has also not apprised this Court in the writ petition

pleadings to the extent that he is in receipt of refund of EMD

deposit.

18. On the other hand, learned counsel for the petitioner

submitted that refund of EMD deposit was not at his request. The

concerned authority deposited in the petitioner's account.

Therefore, the petitioner is not prevented in questioning the

cancellation of tender or re-tendering process. In all fairness, the

petitioner should have accepted the EMD fund under protest or he

should have refunded EMD amount to the concerned authority, if

he really intends to question the validity of cancellation of tender

and retender process. Recently the Bombay High Court in its

order dated 15.03.2023 in the case of Ram Omprakash Patil vs. Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

The Secretary and others in WRIT PETITION (L) NO. 31918

of 2022 held that wining bidder cannot challenge tender

cancellation after accepting the refund of deposit. Therefore on

this score also petitioner has not made out a case.

19. The learned Advocate General in support of

cancellation and re-tendering submitted that during the pendency

of the NIT dated 06.12.2022 and present petition, State

Government is in receipt of certain changes in the Central

Government policy insofar as the implementation of 'PMGSY'

project. In other words, Central Government has revised the

standard of construction with certain variations. This is also one

of the reasons for cancellation of tender and re-tendering process.

20. Learned counsel for the petitioner submitted that such

a decision of the Central Government is much later than the

opening of the financial bid dated 09.02.2023 and the same is not

applicable. Petitioner's above contention cannot be appreciated

for the reasons that the Government must have freedom of

contract as held by the Apex Court in the case of Master Marine

Services (P) Ltd. Vs. Metcalfe & Hodgkinson (P) Ltd. reported

in (2005) 6 SCC 138 in paragraph-12 reads as under:

"12. After an exhaustive consideration of a large number of decisions and standard books on administrative law, the Court enunciated the principle that the modern trend points to judicial restraint in Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

administrative action. The court does not sit as a court of appeal but merely reviews the manner in which the decision was made. The court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise, which itself may be fallible. The Government must have freedom of contract. In other words, fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principles of reasonableness but also must be free from arbitrariness not affected by bias or actuated by mala fides. It was also pointed out that quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure. (See para 113 of the Report, SCC para

94.)"

21. Time and again the Courts have held that the Court

does not have expertise to correct administrative decisions in the

tender matters. The issue involved in the present matter is whether

the State Government in cancelling the tender and re-tendering in

the light of the certain administrative reasons like the tender is

valid for 90 days, six months older tender and the tender not

attaining finality and before execution of the project, the Central

Government proceeded to revise certain standard of construction

resulting in escalation of cost and other technical factors. These Patna High Court CWJC No.11234 of 2023 dt.18-10-2023

issues cannot be examined by the Court as if the Court is the

expert body.

22. In the light of these facts and circumstances, the

petitioner has not made out a case so as to interfere with the

impugned decisions of the State authorities in cancelling the

tender dated 06.12.2022 on 31.07.2023 read with re-tender dated

28.07.2023.

23. Accordingly, the present writ petition stands

dismissed. No order as to costs.

(P. B. Bajanthri, J)

(Arun Kumar Jha, J)

GAURAV S.

P.S./-

AFR/NAFR
CAV DATE                10.10.2023
Uploading Date          18.10.2023
Transmission Date