Patna High Court
Rosmerta Technologies Limited vs The State Of Bihar on 1 May, 2024
Author: Harish Kumar
Bench: Chief Justice, Harish Kumar
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.7305 of 2024
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Rosmerta Technologies Limited having its registered office at 402, 4th Floor,
World Trade Tower, Barakhamba Lane, New Delhi- 110001, and corporate
office at Vatika Tower, Plot no.- 66, Sector- 44, Gurugram- 122003 (Haryana),
represented through its authorised Signatory namely Rajeev Kumar Jha, Male,
aged about 52 years, Son of Manoranjan Jha, working Professional in
Rosmerta Technologies Limited having his residence at Supaul near Sadar
Hospital, Ward No.- 19, Supaul- 852131 (Bihar).
... ... Petitioner/s
Versus
1. The State of Bihar through the Principal Secretary, Transport Department,
Vishwesaraiya Bhawan, Bailey Road, Patna- 800015.
2. Secretary, Transport Department, Govt. of Bihar, Vishwesaraiya Bhawan,
Bailey Road, Patna- 800015.
3. State Transport Commissioner, Transport Department, Govt. of Bihar,
Vishwesaraiya Bhawan, Bailey Road, Patna- 800015.
4. Deputy Secretary, Transport Department, Govt. of Bihar, Vishwesaraiya
Bhawan, Bailey Road, Patna- 800015.
5. M/s Ecartes Technology Private Limited, through its Managing Director,
having its office at 2nd Apna Nagar, Near Mandi Samiti, Transport Nagar,
Mathura- 281001 (U.P.).
... ... Respondent/s
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Appearance :
For the Petitioner/s : Mr. Rajendra Narayan, Sr. Advocate
Mr. Anju Kumari @ Anju Narain, Advocate
For the Respondent/s : Mr. P.K. Shahi, Advocate General
======================================================
CORAM: HONOURABLE THE CHIEF JUSTICE
and
HONOURABLE MR. JUSTICE HARISH KUMAR
ORAL JUDGMENT
(Per: HONOURABLE MR. JUSTICE HARISH KUMAR)
Date : 01-05-2024
We have heard Mr. Rajendra Narayan, learned
Senior Advocate for the petitioner and the learned Government
Advocate for the State.
2. The petitioner, a registered company
represented through its authorized signatory, on being aggrieved
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
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by the communication dated 12.04.2024 produced as Annexure
P5 has preferred the present writ petition seeking quashing of
the same. By the impugned order the respondent Transport
Department, Government of Bihar declared the petitioner
disqualified and rejected the technical bid. The petitioner is also
seeking a direction upon the respondent to accept the technical
bid and opening of the financial bid of the petitioner company
and award the tender as the petitioner is L1 bidder, having
quoted the lowest bid.
3. Learned Senior Counsel while questioning
the impugned order vehemently contended that the official
respondents rejected the technical bid of the petitioner on the
petty and flimsy ground without affording/giving any
opportunity to offer and explain about the typing error of one
digit at one place.
4. It is further contended that the mistake, if any
that occurred in the certificate of Human Resource Declaration,
in relation to man power, a minor typographical error had crept
into as instead of date 30.03.2024, wrong date as 30.03.2023
was erroneously typed/written this was clearly due to oversight
and thus the mistake was ignorable. The respondent authorities
ought to have followed the principles of natural justice, before
declaring the petitioner company disqualified.
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5. The defect if any, was a rectifiable defect at
the time of evaluation of the technical bid, specially when there
is a special clause, whereby clarification could have been asked
by the respondent authorities on such ignorable minor
typographical error before deciding against the petitioner, is the
contention of the petitioner.
6. Learned Senior Counsel also took this Court
to the relevant provisions of the NIT, specially clause 3.18 and
3.19, which in sum and substance stipulates that if deemed
necessary, the Transport Department, Government of Bihar may
seek clarification on any aspect from the bidder. However, that
would not entitle the bidder to change or cause any change in
the substance of tender submitted or price quoted. Transport
Department, Government of Bihar may, if then so desire, ask the
bidder to give a presentation for the purpose of clarification of
the tender. Further clause 3.19 mandates that only a bid
determined as not substantially responsive, will be rejected by
the Transport Department, Government of Bihar and it may not
subsequently be made responsive by the bidder, by correction of
the non-confirmity. The Transport Department, if necessary, can
waive any minor infirmity or non-confirmity or irregularity in a
bid which does not constitute a material deviation, provided
such a waiver does not prejudice or affect the relative ranking of
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any bidder.
7. Referring to the afore-noted clauses, learned
Senior Counsel would thus submit that the declaration of giving
certificate through its Human Resources regarding the fact of
existence of more than hundred persons working on its pay roll,
is not a material requirement, nor would it prejudice or affect
any relevant ranking of the bidder. The respondent authorities
ought to have considered the fact at the time of perusing the
technical bid which was submitted by the petitioner. However,
the Transport Department neither sought a clarification in this
matter, nor waived off the error.
8. If in the tender process this practice is
allowed to be followed it would always end in hurried and hasty
opening of financial bids, in which event both clause number
3.18 and 3.19 becomes obsolete and redundant. It is also the
contention of the petitioner that the petitioner's company stood
to be the lowest in the bidding process, saving atleast INR 4
crores as compared to the leading bidder at present in the
absence of the petitioner.
9. Adverting to the aforesaid facts, Mr. Narayan,
learned Senior Advocate, relied upon a decision of the Supreme
Court in the case of Poddar Steel Corporation vs. Ganesh
Engineering Works, AIR 1991 SC 1579 which held that as a
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
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matter of general proposition it cannot be found that an
authority inviting tenders is bound to give effect to every term
mentioned in the notice in meticulous details and is not entitled
to waive even a technical irregularity of little or of no
significance. The requirements in a tender notice can be
classified into two categories, those which lay down the
essential conditions of eligibility and the others which are
merely ancillary or subsidiary with the main object to be
achieved by the condition. In the first case the authority issuing
the tender may be required to enforce them rigidly and in the
other cases, it would be open to the authority to deviate from
and not to insist upon the strict literal compliance of the
condition in appropriate cases.
10. Further reliance has also been placed on a
decision in the case of B.S.N. Joshi and Sons Ltd. Vs. Nair
Coal Service Ltd. & Ors.,2006 (11) SCC 548, on a similar issue
as noted hereinabove; that if a party fails and neglects to comply
with the requisite conditions which are merely ancillary or
subsidiary to the main object to be achieved by the condition,
the same can be ignored by the authority.
11. On the other hand learned Counsel for the
State countering the submission of the learned Senior Advocate
for the petitioner submitted that admittedly an insufficient
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
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certificate in relation to man power declaration was submitted
and, as such, even if it is an inadvertent error it is a material
requirement which cannot be waived of or rectified. There is no
reason for seeking any clarification since there was no anomaly
and the self-declaration made was existence of hundred
personnel an year back.
12. We have carefully heard the submissions
advanced on behalf of the respective parties and perused the
materials on record.
13. The petitioner company in response to the
NIT No. 02/Samagri-01/2024/1301 dated 27th February, 2024
for selection of agency for supply and printing of laminated
cards without chips for issuance of vehicle registration
certificate and driving license, has submitted his response
through online mode alongwith other eligible bidders. The last
date for submission of proposal was 20.03.2024. The date of
opening of technical bid was fixed as 20.03.2024. The date and
time of technical presentation and proof of concept was fixed on
21.03.2024
and the date of opening of financial proposal and
declaration of result were to be intimated later. Subsequently the
date and time for submission of proposal by bidders were
revised by the corrigendum dated 16.03.2024, marked as
Annexure-P3 extending the last date and time of submission of
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
proposal from 20.03.2024 to 04.04.2024 and as regards opening
of pre-qualification and technical proposal, it was revised from
20.03.2024 to 04.04.2024 and as regards opening of technical
presentation and proof of concept it was revised from
21.03.2024 to 05.04.2024.
14. It would be worthy to note that Clause 5 of
the NIT, which deals with Evaluation Criteria contemplates
basic requirement that a bidder has a minimum of hundred
professionals on its payroll as on bid submission date and a
certificate from HR was/is necessary, as documentary proof for
it. The term of the NIT also speaks of filing one declaration on
employee's strength on letter head of the bidder, addressed to
the State Transport Commissioner as provided in Annexure 10
at page 54, containing the number of professionals in the
organization's pay roll, as on the date of submission of the
tender.
15. The petitioner company submitted its bid
documents on 04.04.2024 in relation to the aforesaid tender of
the Government of Bihar. All the bids of the candidates were
duly verified and in course of the verification it was noticed that
the HR declaration was effective as on 30.03.2023, whereas, as
per the NIT (Annexure 2 to the writ petition) it was to be on the
date of submission of the bid. Having noticed the aforenoted
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
mistake, the tender documents/bid of the petitioner came to be
rejected and a communication in this regard was sent to the
petitioner through mail on 12.04.2024. From the reading of the
relevant terms of the relevant clauses of the NIT, there is no
ambiguity that the declaration of employee's strength must be of
the date on which the bid was submitted. This was also very
material in qualifying the bidder on the technical evaluation.
16. Even as per the NIT, the last date for
submission of proposal was 20.03.2024 and the opening of the
technical bid was fixed on the very same date. The corrigendum
further revised the date of submission of proposal by bidders
from 20.03.2024 to 04.04.2024 and further the opening of the
technical bid was also revised from 20.03.2024 to 04.04.2024.
In both the NIT or the corrigendum, the date of only opening of
the financial bid and declaration of the result were to be
intimated later.
17. From the aforesaid facts, it is crystal clear
that the last date for submission of the proposal by bidder was
either as per the NIT on 20.03.2024 or as per the corrigendum
04.04.2024. However, even as admitted by the petitioner, the
HR declaration was of 30.03.2023 and he submitted the bid on
04.04.2024 which in any view of the matter, cannot be said to be
a mere oversight. It is negligence of the grossest nature, which
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
results in the bidder being disqualified at the threshold of
technical evaluation. The condition of furnishing HR declaration
of more than hundred personnel was an essential condition
being part of the basic requirement as indicated under clause no.
5 of the NIT. The capacity and strength of the company, in
producing the required materials as per the work order, is
dependent upon the man power and thus, by no stretch of
imagination, such condition can be said to be ancillary.
18. The submission of the learned Senior
Counsel that the Transport Department, Government of Bihar
should seek clarification on any aspect from the bidder would
not come to his rescue as that would certainly amount to change
in the substance of the tender submitted, thus, certainly not
permissible even as per clause no. 3.8. It would result in an
allegation of nepotism of having procured a declaration in
consonance with the tender, after the technical bid evaluation,
which is contrary to and in variance to that submitted originally
by the bidder. Clause 3.9 though empowers the Transport
Department, Government of Bihar to waive any minor infirmity
or non-conformity or irregularity in a bid, the instantly alleged
mistake of submission of the declaration certificate in relation to
man power of a far earlier date, would substantially make the
bid non-responsive. The alleged mistake would certainly
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
constitute a material deviation and cause prejudice by affecting
the relative ranking of the bidders. Thus, even clause no. 3.19 of
the NIT would not help the petitioner.
19. In view of the aforesaid discussion, the
contention of the petitioner that he has not been given
opportunity of hearing before declaring him disqualified and
rejecting its technical bid cannot arise. That there is a special
clause whereby clarification could have been asked by the
respondent authorities, would not be applicable on the facts of a
declaration submitted which substantially does not comply with
the technical requirements. This Court finds that the declaration
of employee's strength; through the HR declaration in relation
to man power, is a basic document necessarily required to be
furnished, which declaration should also be as on the date of
submission of the bid. Non-furnishing of the basic required
documents would lead to rejection of the bid by treating it as
non-responsive.
20. The reliance of the learned Senior Counsel
on the decision in case of Poddar Steel Corporation (supra) as
well as B.S.N. Joshi and Sons Ltd. Vs. Nair Coal Service Ltd.
& Ors.(supra) are not applicable. This Court accepts with
respect the proposition of law as mandated by the Hon'ble Apex
Court, that in appropriate cases the authority inviting tender is
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
entitled to waive even a technical irregularity of little or no
significance.
21. In Poddar Steel Corporation (supra) under
the terms of tender notice the earnest money was permitted to be
deposited only by cash or demand draft drawn on the State Bank
of India, failure in which led to rejection of the tender. The
rejection of the tender was upheld by the Hon'ble High Court
against which the matter came up for consideration before the
Apex Court. The Hon'ble Supreme Court having considered the
fact that the payment of earnest money was made by a certified
cheque of the Union Bank of India, drawn on its own branch,
could be treated as sufficient compliance of the terms and held
that it could not be said that the authority inviting the tender
could not waive the literal compliance of such a condition and
accept the tender especially when it was in its interest not to
reject the bid, which was the highest.
22. B.S.N. Joshi and Sons Ltd. (supra) was a
case in which the award of the work to the successful bidder
was challenged on the premise that they failed to fulfill the
essential qualifications. The writ petition was allowed by
the Division Bench of the High Court which came to be
challenged before the Hon'ble Supreme Court. The appeal was
allowed with cost of Rs. 50,000/- against the private
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
respondents holding inter alia that the legal principles operating
in the filed, though not res integra, it would all the same depend
upon the facts and circumstances of each case. The terms
contained in the notice inviting tender may have to be construed
differently having regard to the fact situation obtaining in each
case. The Hon'ble Supreme Court drew a distinction between
essential conditions and those which are ancillary or subsidiary
to the main object. Essential conditions are to be adhered to and
if there is failure so to do, then no bidder can supply the details
at a later stage.
23. In the case at hand, in the opinion of this
Court the requirement of furnishing HR declaration in relation
to man power as on the date of submission of tender was a basic
or essential requirement which cannot be waived off. There is
no reason to seek clarification regarding a declaration made by
the bidder; apprehending that it could be an error.
24. On the invocation of power of judicial
review in matters relating to Government contracts/ tenders, the
Hon'ble Supreme Court in the case of Jagdish Mandal vs. State
of Orissa, 2007 (14) SCC 517 has held that in matters relating
to tenders or award of contract, certain special features should
be borne in mind. A contract is a commercial transaction.
Evaluating tenders and awarding contracts are essentially
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
commercial functions. Principles of equity and natural justice
stay at a distance. If the decision relating to award of contract is
bonafide and is in public interest, Court will not in exercise of
power of judicial review interfere even if procedural abrasion or
error in assessment resulting in prejudice to a tenderer is made
out. The power of judicial review will not be permitted to be
invoked to protect private interests at the cost of public interest,
or to decide contractual disputes.
25. The Hon'ble Supreme Court in the case of
Tata Cellular vs. Union of India, (1994) 6 SCC 651 referring
the limitation relating to the scope of judicial review of
administrative decisions and exercise of powers in awarding
contracts has enunciated the following principles:-
"(1) The modern trend points to
judicial restraint in administrative
action.
(2) The court does not sit as a court of
appeal but merely reviews the manner
in which the decision was made.
(3) The court does not have the
expertise to correct the administrative
action. 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.
(4) The terms of the invitation to
tender cannot be open to judicial
scrutiny because the invitation to
tender is in the realm of contract.
More often than not, such decisions
are made qualitatively by experts.
(5) The Government must have
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
freedom of contract. In other words, a
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 principle of
reasonableness (including its other
facts pointed out above) but must be
free from arbitrariness not affected by
bias or actuated by mala fides.
(6) Quashing decisions may impose
heavy administrative burden on the
administration and lead to increased
and unbudgeted expenditure."
26. The Hon'ble Supreme Court also
highlighted the inherent limitations in the exercise of power of
judicial review of contractual powers. It was observed that the
duty to act fairly will vary in extent, depending upon the nature
of cases, to which the said principle is sought to be applied. The
State has the right to refuse the lowest or any other tender,
provided the endeavor is to get the best person or the best
quotation and the power to choose is not exercised for any
collateral purpose or in infringement of Article 14 of the
Constitution of India.
27. Admittedly the petitioner failed to satisfy
the basic requirement of filing necessary documents in relation
to man power as on the date of submission of the bid, leading to
disqualification of the petitioner in the technical evaluation,
which in the opinion of this Court does not result in any
Patna High Court CWJC No.7305 of 2024 dt.01-05-2024
illegality, infirmity or impropriety.
28. In view of the discussions made
hereinabove, this Court does not find any merit in the present
writ petition.
29. The writ petition stands dismissed.
(K. Vinod Chandran, CJ)
(Harish Kumar, J)
supratim/-
AFR/NAFR AFR
CAV DATE NA
Uploading Date 06.05.2024
Transmission Date NA
