MS SATYA SAI BUILDERS Vs MS LAKSHAY CONSTRUCTION AND OTHERS

Uttarakhand High Court 10 May 2018 SPECIAL APPEAL No. 297 of 2018 (2018) 05 UK CK 0046
Bench: Division Bench
Result Published
Acts Referenced

Judgement Snapshot

Case Number

SPECIAL APPEAL No. 297 of 2018

Hon'ble Bench

K.M. JOSEPH, C.J, SHARAD KUMAR SHARMA, J

Advocates

T.A. Khan, Aditya Kumar Arya, Rajendra Singh Azad, Pradeep Joshi

Final Decision

Allowed

Acts Referred
  • Constitution of India, - Article 226

Judgement Text

Translate:

K .M. Joseph, C.J Â Â Â Â Â Â Â

1. When the appeal was taken up, though it was listed for admission, on agreement of the both the parties, the Appeal was itself heard.Â

2. Appellant is the 7th respondent in the writ petition. Writ petitioner and the appellant participated in a tender, which was done through e-

tendering for flood construction work on right bank of river Mandakini. The work consisted of two stages, namely, technical and financial.  The

technical bid of the writ petitioner was rejected. This occasioned filing of the writ petition and he sought quashing of the order dated 31.10.2017

issued by respondent nos. 2 to 6 Committee (Annexure-11 to the writ petition). A mandamus was sought to command acceptance of his technical

bid and also to open the financial bid afresh considering the technical bids of the petitioner and other successful bidders. Be it noted that on the basis

of opening of the financial bid, bid of the appellant was found to be apparently lowest and it was accepted.Â

3. The learned Single Judge allowed the writ petition. The reasoning of the learned Single Judge appears to be as follows:

Tenders were invited by respondent no. 3 from eligible candidates on 22.09.2017. The auction was to be done by way of twotier bidding process.Â

The technical bids were to be opened on 31.10.2017 and after evaluation of the technical bids, the financial bids of the persons, who qualified in the

technical bids were to be opened on 21.11.2017. Â

4. Thereafter, the learned Single Judge reasons as follows:

“8. It is an admitted case of the State Government that the technical bid of tuhe petitioner has been rejected but it was never informed to the

petitioner prior to 21.11.2017. the admitted case of the respondents is that the technical bid was uploaded on 21.11.2017 and financial bid was

opened on the same day at 05.18 P.M. This is clearly the violation of the tender conditions. By not informing the petitioner that he has been

unsuccessful in his bid, the essential condition of the tender has been violated. Had the petitioner been informed in time that his technical bid has

been rejected, he could have made a representation before the respondent authorities to make out a case that the rejection of his technical bid is on

nonessential ground and they may reconsider his bid. This opportunity, however, was never given to the petitioner. Moreover, out of the total 17

candidates, the technical bids of 14, candidates have been rejected and only three candidates were declared successful in the technical bid.

 9. The comparative rates of the three companies who have qualified the technical bid show that the difference in rates bid made by them is

extremely marginal. However, nothing needs to be said on this aspect.â€​

 5. He notes that normally, the Court would have refrained from interfering in such matters, which are purely commercial in nature, but since in the

present case, there has been a clear violation of the tender conditions, therefore, an interference is required in this matter. The writ petition was

allowed and the entire bidding process adopted by the respondents was quashed and fresh bids were directed to be invited by the respondents in

accordance with law. Â

6. We heard Mr. T.A. Khan, learned Senior Counsel on behalf of the appellant, Mr. Rajendra Singh Azad, learned counsel for the writ petitioner and

Mr. Pradeep Joshi, learned Standing Counsel on behalf of the official respondents.Â

7. Mr. T.A. Khan, learned Senior Counsel would submit that this is a case, where the writ petitioner had not complied with the mandatory conditions

and, therefore, his technical bid was rejected; whereas, appellant’s bid, which was found responsive, was processed and the contract was finalized

in his favour, but what is more, approximately 35 per cent of the work has already been carried out. He would submit that there was no basis for

the learned Single Judge to interfere with the matter as the technical bid of the writ petitioner was not responsive. Â

8. Per contra, Mr. Rajendra Singh Azad, learned counsel for the writ petitioner would point out that this is a case, where the last date was 31.10.2017

for submission of the bids. The writ petitioner had submitted the bid, which was responsive in law. He has a definite case that the writ petitioner

had made available the hard copy of the document in question. In this regard, he drew our attention to Paragraph 4 of the writ petition. He would

submit that, in fact, official respondents have favoured the appellant. In this regard, he points out that the bids of five other tenderers have also been

rejected in the same vein and, therefore, this probabalises his case that the attempt is to favour certain persons. He would next contend that under

the e-tendering procedure, there was a duty on the part of the official respondents, who are in-charge of e-tendering process, to communicate the

decision rejecting the technical bid. He expands the argument by pointing out that the technical bid was to be opened on 31.10.2017.  He

receives a communication, which he has challenged, but that is done on 21.11.2017. On the same day, the financial bid is opened and it is

finalized.  He would submit that actually the petitioner gave the hard copy and there was no basis to reject his technical bid. Â

9. We also heard Mr. Pradeep Joshi, learned Standing Counsel for the respondent No. 7. He would submit that the hard copy was not submitted and

also he would submit that at the time when the technical bids were opened, the representatives were present.

10. The issue involved in this case relates to judicial review of the decision to distribute largesse by way of contractual rights. Interference in such

matters, though permissible, must be limited to ascertaining whether any illegality has been committed and further whether there is overwhelming

public interest justifying interference.

11. In this case, the e-tendering was resorted to. One of the conditions for making technical bid responsive was admittedly the production of hard copy

of Form ‘C’. In fact, learned Senior Counsel, Mr. T.A. Khan, would point that purport of this is to bind the contractor so that he would honour

the obligations towards the Government.Â

12. The substantive reasoning of the learned Single Judge appears to be as found in Paragraph 9, namely, there was a failure on the part of the

authorities, intimating the rejection of the technical bid except when they did so on 21.11.2017 and that had the petitioner been given an opportunity to

represent against the rejection, he could have pointed out that it pertains to a non-fulfillment of non-essential condition and therefore, the matter could

have been considered. He also has reasoned that a perusal of the financial bid would show that there was not much difference in the rates. The

financial bids were opened on the same day and the matter was finalized.

13. Therefore, it becomes necessary to examine whether the argument, which, in fact, is also raised before us by Mr. Rajendra Singh Azad, learned

counsel for the writ petitioner that in fact, there was a duty to communicate the rejection of his technical bid and as to when it was to be

communicated is justified with reference to the specific terms of the tender. In the first place, before this Court, he made available across the bar, a

document, which apparently was not produced in the writ petition and does not form part of the record. Nonetheless, we had a glance at the same. It

appears to be a notice to bidders on e-tendering and comes with the heading Government eProcurement System. The relevant portion, which he

emphasizes, which comes under the heading “Advantages of E-Tendering Systemâ€​, reads as follows:

“The bidders will be able to see the status of the tenders for which they have submitted quotes in different stages and would also be informed of

the status by E-Mail. For the bidders who have specify the Product Category through “Product Category†option, information of all the tenders

published under the selected product category will be sent by E-Mail.â€​

14. We are unable to see how this will advance the arguments of the writ petitioner. This, as we note, is only to point out the advantages of e-

tendering system. It proceeds to say that the bidders will be able to see status of the e-tenders, for which they have submitted quotes in different

stages and they will also be informed of the status by email and for the bidders, who have specified the product category, through product category

option, information will be sent by Email under the selected product category. We notice incidentally that this relates to work and it is not really relating

to procurement, but even assuming for a moment that it has sway over the contract in question, it does not in any way help the writ petitioner to make

out a case that there was requirement on the part of the official respondents to communicate the rejection at a particular time or that it contemplated

giving an opportunity to the tenderers, whose technical bids were rejected to make good any lacunae in the bids. Therefore, we cannot attach any

significance to this document.

15. The next question, which we may consider is whether the writ petitioner had made available the hard copy as the same is undoubtedly and

admittedly a requirement. In this regard, we may notice the averment made in Paragraph 4 of the writ petition which reads as follows:

“4. That it is also pertinent to mention here that the petitioner has submitted all required documents and furnished all the information required in the

aforesaid tender documents with the e-tender and uploaded on the same site. The tender was submitted by the petitioner online in

http//www.uktenders.gov.in website as required in the bid form / tender documents stated above withini time on 30-10-2017 as well as a hard copy of

all the same wre also submitted in sealed cover by the petitioner in the office of respondent no. 3 ojn 31-10-2017 through sealed envelop which was

received in the office within time on 31-10-2017. A true Photostat copy of the received acknowledgements of uploaded bid dated 30-10-2017 and of

hard copy dated 31-10-2017 are being filed herewith jointly and marked as Annexure no. 2 to this writ petition.â€​Â

16. This is controverted by respondent no. 3 in the counter affidavit in Paragraph 5, which reads as under:

“5. That the contents of para 4 of the writ petition are wrong hence denied. It is submitted that the petitioner has uploaded affidavit / Form-C,

but has not submitted the original / hard copy of the same before the office of the answering respondent in pursuance of the tender notice dated

22/9/2017. It is further submitted that as per Clause 4.2 of Instruction to Bidder prescribed in tender document, Point No. 7 of the date-sheet / table

of tender notice and clause 8.4 of Instruction to Bidder, the original documents were to be submitted before the office of the answering respondent

with the tender form, but the petitioner has not submitted the same, therefore, the bid of the petitioner was found non-responsive by the Technical

Evaluation Committee. For kind perusal of the Hon’ble Court copies of the relevant extract of the Clause 4.2, Clause 8.4 of Instruction to Bidder

(in short I.T.B.) and point no. 7 of the date-sheet / table of tender notice are being jointly filed herewith and marked as

ANNEXURE NO. C.A.-1 to this affidavit.â€​

17. We notice that conspicuous by its absence is a rejoinder affidavit rebutting the allegations made in the counter affidavit that the writ petitioner

did not make available the hard copy. In proceedings under Article 226 of the Constitution of India, if the petitioner does not choose to join issue, with

the stand taken by the official respondents in the counter affidavit and unless the Court finds that the averment in the counter affidavit is so untenable

that it is to be rejected, the Court would conclude that the un-rebutted allegation in the counter affidavit is to be treated as a fact, which can be acted

upon. Therefore, we are constrained to proceed on the basis that the writ petitioner has not made available the hard copy contrary to his contention as

required by Form ‘C’ of Section 4 of the ITB conditions.

18. We also lay store by the fact that just as in the case of the writ petitioner, in the case of five other tenderers, the technical bids have been rejected

on the self same ground. Far from advancing the case of writ petitioner that this is all done to select a few, it only goes to show that the board has

applied a standard across the board and acted fairly in terms of the contractual conditions which they were obliged to and therefore it goes to show

that they have rejected the tender wherever it was found non-responsive and they have treated it as a mandatory condition.Â

19. The learned counsel for the writ petitioner would draw our attention to Page 159 of the paper book of the writ petition and point out that Annexure

12 which is produced therein goes to show that the committee had met at 3.00 p.m. and finalized the candidates, whose technical bids apparentlyÂ

were responsive and the name of the appellant figures at serial no. 1. He next draws our attention to a document at page 160, which appears to be the

tender summary report. It goes to show, among other things, that the bid of the writ petitioner was rejected along with 13 others and the bids of three

persons were accepted under the heading “Financeâ€. There were 17 persons and only 3 persons, who passed muster in the technical bids stage.

He draws our attention to last column, namely, “Status Updated On†and would contend that it shows that in regard to the technical bids, which

were found accepted, the same are shown accepted at 06:47 PM. Therefore, this is in contradiction to what is stated in Annexure 12, which shows

that it is done on 03:00 PM. He also points out that in Paragraph 12 of the counter affidavit, it is mentioned that the bids were finalized at 05:08 PM.Â

As far as the attempt to point out the existence of discrepancy between the documents annexed as Annexure 12 and Page 160 of the Paper Book is

concerned, we are of the view that it is totally untenable. The column actually relates to time, at which the decision was uploaded. The decision was

apparently uploaded only after it was taken. Therefore, the fact that it is shown as uploaded at 06:47 PM on 21.11.2017 cannot militate the action or

the fact that the decision was taken at an earlier point of time on the same day and cannot in any way advance the case of the writ petitioner.

20. It is also relevant to notice the version of the government as to what has happened in regard to the bids. This is discernible from the un-rebutted

allegations (as there is no rejoinder affidavit) in Paragraph 12 of the counter affidavit, which reads, inter alia, as follows:

 “12. That the contents of paras 13 to 21 of the writ petition are wrong hence denied. It is submitted that the technical bids were opened on

31/10/2017 by the Tender Evaluation Committee, the details of the documents submitted by the participants were prepared. It will not be out of

place to mention here that after opening the technical bid the Tender Evaluation Committee scrutinized and verified the documents submitted by the

participants from 1/12/2017 to 21/12/2017 after this proceeding the evaluation sheet was prepared and the same was prepared on 21/11/2017 and was

finalized at about 10:30 A.M. due to the non-availability of the network / interruption in the internet, the same was uploaded on 21/11/2017 at about

5:00 PM. It is pertinent to mention here that the evaluation chart has not been uploaded after opening the financial bid. A copy of the office order

dated 21/11/2017 uploaded on the website is being filed herewith and marked as ANNEXURE NO. C.A.-4 to this affidavit.Â

It is stated here that as the evaluation chart of the technical bid could not be uploaded due to the nonavailability of network so the financial bid was

opened on 21/11/2017 at about 5:08 P.M. after uploading of technical evaluation chart i.e. at about 5:00 P.M. thereafter the price bid of the successful

bidders were opened on 21/11/2017 at about 5:18 P.M., the tender proceedings were completed as per Clause 23 of the Instructions of the Bidders.Â

It is further submitted that the petitioner has been intimated through mail regarding rejection of his technical bid on the same day at about 5:00 P.M.

before opening the financial bid. Being a lowest one (L-1) bidder, the respondent no. 7 was declared successful bidder and an agreement was

executed between the department and the respondent no. 7 on 21/12/2017.). It is further submitted that the respondent no. 7 has completed 8 % of

the total work till 12/2/2018.â€​

21. No doubt, it is true that in the counter affidavit, it is stated that the technical bid was opened at about 5.08 p.m. We do not think that this aspect is

such that it should lead an interference with the case of distribution of largesse.

22. We may also advert to Clause 26 of the Conditions of Contract, which relates to examination of bids and determination of responsiveness. The

same reads as under:Â

“26. Examination of Bids and Determination of Responsiveness.Â

26.1 Prior to detailed evaluation of Bids, the Employer will determine whether each Bids.Â

(a) Meets the eligibility criteria defined in Clause 3. (b) Has been properly signed by an authorized signatory (accredited representative holding

Power of Attorney shall inter alia include a include a provision to bind the Bidder to settlement of disputes clauses.Â

26.2 A responsive Bid is one which conforms to all the terms, conditions and specifications of the Bidding documents without material deviation or

reservation. A material deviation of resonation is one.Â

(a) Which effects in any substantial way the scope quality or performance of the Works.Â

(b) Which limits in any substantial way the Employer’s rights or the Bidder’s obligation under the Contractor.Â

(c) Whose rectification would affect unfairly the competitive position of other Bidders presenting substantially responsive Bids.Â

26.3 If a Bid is not substantially responsive, it will be rejected by the Employer, and may not substantially be made responsive by correction or

withdrawal of the non conforming deviation or reservation. “

23. No doubt, Clause 23, as we have noticed, refers to Bid opening and in the counter affidavit, there is reference to the financial bid being opened in

terms of clause 23. Clause 23 reads as follows:

“23. Bid Opening  23.1 On the due date and appointed time in the office of Superintending Engineer Irrigation Works Circle Rudraprayag a

committee comprising of Superintending Engineer Irrigation Works Circile Muni Ki Reti and Superintending Engineer, Irrigation Work Circle, Srinagar

will first open online tenders.

23.4(1) Subject to confirmation of the bid security by the issuing Bank, The Bids accompanied with valid bid security will be taken up for evaluation of

the technical containing qualification information and other information required to be furnished in pursuant of Clause 12 if any bid contains any

deviation from the bid documents and / or deviation of the bid security, then the bid will be rejected and the bidder informed accordingly. (ii) The

name of successful bidder, whose technical bid and documents, after its opening and evaluation are found to be in accordance with the requisite and

prescribed qualifying criteria for technical eligibility for consideration and opening of price bid, shall be announced and displayed in the office of the

Superintending Engineer, Irrigation Works Circle Rudraprayag.Â

(iii) The sealed envelop-II (original and copy) containing process BOQ of the unsuccessful bidder’s shall be returned to him without opening.Â

(iv) After receipt of confirmation of the bid security by the issuing bank, the valid price bids of successful technical bidders shall be opened on date

and time which will be announced by a committee, as specified in Clause 23.1.â€​

24. Clause 23.4, in particular, we notice provides that after receipt of confirmation of the bid security by the issuing bank, the valid price bids of

successful technical bidders shall be opened on the date & time which will be announced by a committee, as specified in Clause 23.1. The bids have

been opened admittedly on 21.11.2017 immediately on the same day on which the technical bids were also rejected a little earlier. We may have been

inclined to be detained more by this aspect had it been a case where the petitioner has established his case to be considered in the financial bid. Here,

the petitioner must make good his case about the illegality in the rejection of his technical bid. His definite case that he has produced the hard copy

is one which cannot be accepted at all. If that is so, the rejection of his technical bid also cannot be faulted.

25. We may also in this context notice that the petitioner has not chosen to challenge communication dated 06.12.2017, which is adverted to by the

petitioner in Paragraph 10 of the writ petition. He has also not challenged the communication on whatsapp dated 21.11.2017, which is found in

Paragraph 12 of the writ petition. In fact, the communication dated 06.12.2017, by which the bid was specifically rejected giving reasons, petitioner

has still not chosen to challenge the same. What he has challenged appears to be the ‘technical bid comparative chart statement’. Â

26. In the above circumstances, we do not think that the judgment of the learned Single Judge on the reasoning, which he has given should be

supported. Accordingly, the Appeal will stand allowed and the judgment of the learned Single Judge will stand setaside. No order as to costs.

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