M/S Hytronics Enterprises vs Uunion Of India
2023 Latest Caselaw 3027 Tel

       HON'BLE MRS JUSTICE SUREPALLI NANDA

           WRIT PETITION No.25868 OF 2023


ORDER:

Heard learned counsel for the petitioner and

learned counsel appearing for the respondents.

2. The petitioner approached the Court seeking the

prayer as follows:

"To issue a writ of Mandamus or any other writ / order / direction declaring the action of the Respondents in not opening the financial bid of the Petitioner despite the petitioner satisfying the tender conditions in Tender No.C_SG_C_36_5_385 dated 26.06.2023 issued by 3rd respondent as illegal, arbitrary, highhanded and contrary to the settled position of law apart from being violative of Article 14, 19(1)(g) and Article 21 of Constitution of India and consequently direct the Respondents to open the financial bid of the Petitioner submitted by them pursuant to the said Tender Notification and pass such other order or orders as this Hon'ble Court may deem fit and proper in the circumstances of the case."

PERUSED THE RECORD

3. The case of the petitioner, as per the averments

made in the affidavit filed by the petitioner in support

of the present writ petition, in brief, is as follows:-

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a) The petitioner is a private limited company, which

deals with the manufacture of Vital Safety Relays and also

executes Railway Signalling interlocking projects, involving

Relay Logic and Computer based interlocking (CBI) or

Electronic Interlocking (Ei). The petitioner pursuant to the

tender No.C_SG_C_36_5_385 dated 26.06.2023 with issued

by the 3rd respondent, pertaining to "Comprehensive

signalling and telecommunication works for provision of

automatic block signalling system in Mandamari-Peddapalli jn

Section of Secunderabad division in south central railway", the

petitioner submitted technical and financial bid on 07.08.2023

with estimated cost of the tender being Rs.77,89,57,843,73/-.

b) As per the tender document, the technical bids of the

participants would first be opened and those participants who

qualify in the technical bid will then be short listed for the

financial bid stage and then the financial bids of the short

listed participants are opened and the bidders are sorted in

ascending order. The pre-qualification bid opening date was

on 14.08.2023 and the petitioner being qualified to take part

in the tender process, downloaded the tender document and

after verifying the eligibility criteria in Clause No.2.2 of the

tender document, took part in the tender process.

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c) In accordance with clause 1.2.4 of the tender

document, the petitioner submitted bid security for

Rs.38,94,800/- vide BG Ref No.050-5523-bg-000-2350 dated

04.08.2023. As per the said clause the bidder will have to

provide the bid security through e-payment Gateway of

Authority or submit as Bank Guarantee Bond from a

scheduled State Bank of India, Commercial Branch. The Bank

Guarantee Bond shall be valid for a period of 90 days beyond

the bid validity period.

d) The petitioner observed that during the submission of

the bid, the petitioner has inadvertently mentioned the claim

period of the bank guarantee submitted by the petitioner to

be till 30.04.2024 instead of 30.04.2025. Then the 3rd

respondent had sought clarification in this regard from the

bank vide letter dated 18.08.2023 to which the bank has

replied vide letter dated 21.08.2023 thereby indicating that

the claim period of the Bank Guarantee submitted by the

petitioner is until 30.04.2025. The petitioner informed the 3rd

respondent vide representation dated 30.08.2023 that the

petitioner had inadvertently mentioned the claim period of the

Bank Guarantee submitted by the petitioner to be till

30.04.2024 instead of 30.04.2025. The SBI vide letter dated

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21.08.2023 indicated that the claim period of the bank

guarantee is till 30.04.2025.

e) Further the 3rd respondent has orally informed the

petitioner that the petitioner's bid would be disqualified for the

reason that the claim period of the bank guarantee submitted

by the petitioner is mentioned as 30.04.2024 instead of

30.04.2025. The petitioner pointed out that it was eligible for

taking part in the tender process and also the documents

were scrutinized by the 3rd respondent and no objection was

ever raised by them and also the 3rd respondent had sought

clarification from the bank vide letter dated 18.08.2023 and

had acknowledged the reply received from the bank vide

letter dated 21.08.2023 indicating that the claim period of the

bank guarantee submitted by the petitioner is till 30.04.2025.

Therefore, the petitioner's bid cannot be rejected. The

petitioner also addressed a representation dated 30.08.2023

to the 3rd respondent but the same has not been considered

till date. The respondents informed the petitioner on

13.09.2023 that they will be opening the price bid on

16.09.2023 and that the petitioner's price bid would not be

opened. Therefore, the present writ petition is filed.

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4. The counter affidavit has been filed by the

respondents and in particular,, the relevant portion of

paragraph No.4 and paragraph No.10 of the said

counter affidavit reads as under:

"Whereas the petitioner submitted bank guarantee which is valid upto 30-04-2024 only and it is not in terms of Clauses 1.2.2 and 1.2.4 of the RFP (Request for Proposal). On this ground the present writ petition is liable to be dismissed.

With regard to para (11) it is submitted that the contention of the petitioner that the defect is curable or cured by the bidder then rejecting the entire bid of the participant amount to gross illegality and such rejections have been held to be fault as held by various Courts, is not applicable to the present case of the petitioner, since the technical bid is not yet finalised till date nor draft minutes are circulated among the Tender Committee Members."

5. A bare perusal of the contents of the letter dated

21.08.2023 reads as under:

"With reference to your mail and letter No.C/SG/C/36/5/385 dated 18.08.2023, we confirm having issued BG No.0505523BG0002350 for Rs.38,94,800/- in favour of beneficiary FA&CAO/CN/SC, South Central railway on behalf of M/s Hytronics Enterprises India Private Limited as on 04.08.2023. The claim period is till 30.04.2025. The beneficiary has the complete rights on the BG till 30.04.2025. The Bank

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has charged the Company (HEIPL) the fees applicable till 30.04.2025."

DISCUSSION AND CONCLUSION

6. The specific case of the petitioner is that the petitioner

submitted a bid security of Rs.38,94,800/- as on 04.08.2023

vide bank guarantee No.0505523BG0002350 and the

petitioner participated in the bid and made an application by

duly offering the bid security from period 12.07.2023 to

30.04.2025 and the same had been confirmed in favour of the

petitioner. But however, on the ground that the same is not

in terms of Clauses 1.2.2 and 1.2.4 of the request for

proposal, the same is not being considered by the

respondents.

7. Further the case of the petitioner is that a mistake crept

in the tender filling form and though the petitioner had

furnished the security commencing from 12.07.2023 to

30.04.2025 in the application due to the error it was filled as

30.04.2024 whereas the bid security drawn from SBI vide

BG.No.0505523BG0002350 dated 04.08.2023 clearly shows

that the validity is till 30.04.2025.

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8. A bare perusal of the letter dated 21.08.2023 of the

State Bank of India, Secunderabad, clearly indicates the date

of claim period as 30.04.2025, pertaining to the bank

guarantee amount of Rs.38,94,800/- in favour of beneficiary

FA and CAO/CN/SC, South Central Railway on behalf of the

applicant i.e. M/s Hytronics Enterprises (India) Private Limited

i.e. the petitioner herein as on 04.08.2023 vide bank

guarantee No.0505523BG0002350.

9. Learned counsel for the petitioner places reliance

on the judgment dated 11.09.2013 of the Hon'ble Apex

Court reported in (2013) 10 SCC 5 in Rashmi Metaliks

Limited and another v Kolkata Metropolitan

Development Authority and others, and in particular

paragraph 18 and 19, reads as under:

"18. We think that the income tax return would have assumed the character of an essential term if one of the qualifications was either the gross income or the net income on which tax was attracted. In many cases this is a salutary stipulated, since it is indicative of the commercial standing and reliability of the tendering entity. This feature being absent, we think that the filing of the latest income tax return was a collateral term, and accordingly the Tendering Authority ought to have brought this discrepancy to the

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notice of the appellant Company and if event thereafter no rectification had been carried out, the position may have been appreciably different. It has been asserted on behalf of the appellant Company, and not denied by the learned counsel for the respondent authority, that the financial bid of the appellant company is substantially lower than that of the others, and, therefore, pecuniarily preferable.

19. In this analysis, we find that the Appeal is well founded and is allowed. The impugned judgment is accordingly set aside. The disqualification of the Appellant-company on the ground of it having failed to submit its latest Income Tax Return along with its bid is not sufficient reason for disregarding its offer/bid. The Respondents are directed, therefore, to proceed further in the matter on this predication. The parties shall bear their respective costs. "

CONCLUSION

10. Taking into consideration the above referred facts and

circumstances of the case and also the contents of the letter

dated 21.08.2023 issued by the State Bank of India,

Secunderabad (referred to and extracted above), and duly

considering the averments made at para 10 of the counter

affidavit filed by the respondents that technical bid is not yet

finalized as on date and duly taking into consideration the

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view taken by the Apex Court in judgment dated

11.09.2013 reported in (2013) 10 SCC page 95 in

Rashmi Metaliks Limited and another v Kolkata

Metropolitan Development Authority and others, the writ

petition is disposed of directing the respondent Nos.2 and 3 to

consider the representation of the petitioner dated

30.08.2023 addressed to the respondent Authority clarifying

Bid clarification with regard to BG Ref No.050-5523-bg-000-

2350 dated 04.08.2023 as effective from 12.07.2023 to

30.04.2025 drawn from SBI, Commercial Branch,

Secunderabad within a period of two weeks from the date of

receipt of copy of the order in accordance to law, duly taking

into consideration the view taken by the Apex Court in its

judgment dated 11.09.2013 reported in (2013) 10 SCC

page 95 in Rashmi Metaliks Limited and another v

Kolkata Metropolitan Development Authority and others

and duly understanding the fact that respondent Nos.2 and 3,

should have sufficient reason for disregarding petitioner's bid

which admittedly as borne on record does not exist in the

present case, and pass appropriate reasoned order, duly

communicating the decision to the petitioner. Until a decision

is taken by respondent Nos.2 and 3, upon the representation

dated 30.08.2023 of the petitioner within the time period

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stipulated by this Court, the respondents are directed to

maintain status quo with regard to the subject issue. It is also

observed that if the respondent authorities need any

clarification or any further documents, they are at liberty to

issue notice to the petitioner and secure the same in deciding

the subject issue. However, there shall be no order as to

costs.

Miscellaneous petitions, if any, pending in this Writ

Petition, shall stand closed.

___________________________________ MRS JUSTICE SUREPALLI NANDA

Date: 10.10.2023 Kgk