@JUDGMENTTAG-ORDER
Syed Saadatulla Hussain, J.@mdashAt the time of arguments the counsel for all the parties submitted that as the arguments in the W.P.M.P. and the writ petition, are one and the same, they agreed to dispose of the main writ petition.
2. In this writ petition, the petitioner seeks writ of mandamus declaring the action of respondents 1 and 2 in not disqualifying the 3rd respondent for submitting bid for the package No. VI, a.b.c. as the 3rd respondent did not fulfil with the pre-qualifications as prescribed by the pre-qualification document.
3. It is submitted by Mr. Ramana Reddy, Senior Counsel, appearing for the petitioner that the 1st respondent invited applications in Tender Notice No. HUDA/DEV/CE/GLU/9-95-96 dated 20.1.1995 from the leading Contractors/Firms of repute and other appropriate class of contractors registered with Government of Andhra Pradesh/CPWD/MES/Railways with suitable experience in construction of Flyovers, Bridges/ROBs etc. for pre-qualification for the works of construction of Flyovers/Bridges/ROBs etc. in Twin cities of Hyderabad and Secunderabad. These works were proposed to be entrusted on turnkey basis including surveying, soil and foundation investigation, planning, structural designing and execution as per the Ministry of Surface Transport (Most) Indian Road Congress (IRC) standards and specifications. The works were tentatively grouped in packages as detailed below :
-------------------------------------------------------------------------- S. No. Pakage No. Name of the Work -------------------------------------------------------------------------- 1. I Construction of Flyovers at :
(a) Ameerpet junction.
(b) Punjagutta junction.
(c) Visveswarayya junction.
(d) 2. II (a) Telugutalli junction.
(b) Ambedkar Statue junction.
(c) Basheerbagh junctiun.
3. III (a) R.T.C. Cross Roads junction.
(b) Narayanaguda junction.
(c) Mojamjahi Market junction.
4. IV (a) Secunderbad CTO junction.
(b) Airport junction.
(c) Sanjeevaiah Park (ROB) junction.
5. V (a) Chanderghat junction.
(b) Nalgonda ''X'' Roads junction.
6. VI (a) Parallel bridge at Nayapool.
(b) Flyover at Nayapool. -------------------------------------------------------------------------
4. It is submitted that the dates for issue of pre-qualification documents for the above works were fixed from 3.12.1995 to 27.12.1995 from the office of the 1st respondent. The last date for submission of pre-qualification documents was fixed on 30.12.1995 by 5 p.m. by the 1st respondent. Subsequently, the 1st respondent called for Chit Tenders Notice No. HUNA/DEV/GL/13-95-96, dated 1.3.1996. The petitioner has applied for the pre-qualification documents and submitted for the package No. VI as mentioned above. Subsequently, the 1st respondent informed the petitioner about his eligibility for tendering for package-VI works (Lr. No. 10369/HUDA/DEV/CE/FO/95, dated 1.3.1996), with some changes in package VI works as per the letter with changes consisting of (a) Parallel bridge at Nayapool, (b) Flyover at Masab Tank and (c) Flyover at Harisharakala Bhavan at Secunderabad. Along with letter, the 1st respondent called for Chit Tenders Notice No. HUNA/DEV/GL/U/13/95-96, dated 1.3.1996. The 1st date for submission of tenders for packages of works fixed on 30.3.1996 which was subsequently extended to 30.4.1996. The last date was further extended to 10.5.1996. The petitioner has submitted his tender on 10.5.1996. Tenders were opened on the same date. The petitioner had applied for package VI works viz., (a) Parallel bridge at Nayapool, (b) Flyover at Masab Tank and (c) Flyover at Hariharakala Bhavan, Secunderabad.
5. It is further submitted that there were 8 tenderers including the petitioner. The following contractors/firms offered their bids for the package VI :
(1) Madhav Hi-Tech. Engineering Limited (R-3).
(2) B. V. Subba Reddy (Petitioner).
(3) Navayuga Engineering Company.
(4) Prasad and Company (Project Works) Limited.
(5) Gammon Indian Limited.
(6) Hindustan Construction Company.
(7) Trafalgar Construction Company.
(8) Bhargeeratha Engineering Company.
6. It is submitted that on the opening of tenders the 3rd respondent was found to be the lowest tenderer. The Contractors/Firms shall have to fulfil the conditions as per the Instructions 8(a)(i) and (ii) at page 15 of the Pre-qualification Document, dated 20.11.1995, which are :
(i) The Contractors/firms should have experience in construction of flyovers/bridges/ROBs/Aqueducts or similar structures.
(ii) The Contractors/firms having good experience in similar type of works indicated above and an annual turnover of not less than Rs. 10.00 crores for a similar group of works in any one year of the preceding 5 years and out of which, turnover on a single similar work should not be less than Rs. 3.00 crores, are only eligible for the pre-qualification of the works mentioned in this Office Tender Notice No. HUDA/DEV/CE/GLU/9-95-96 dated 20.11.1995.
7. It is submitted that the 3rd respondent does not fulfil the above requirements of annual turnover of more than Rs. 10.00 crores in construction of Flyovers/Bridges/ROBs/Aquaducts or similar structures of the preceding 5 years. The petitioner filed representation before the respondents requesting them to verify the bona fide of 3rd respondent regarding the fulfilment of the above requirements with the concerned Department where the 3rd respondent has executed the works and also the authenticity of the certificates produced to them for its eligibility for tendering, as it is necessary pre-qualification even to submit bids. The petitioner made four representations on 24.6.1996, 25.7.1996, 24.8.1996 and 4.9.1996 bringing to their notice that the 3rd respondent is having the habit of abandoning the works without completion mentioning the specific incident and that it has not executed works worth about 10.00 crores in any one year during the period 1990-91 till 1994-95. Hence, the respondents 1 and 2 should have disqualified the third respondent as it did not pre-qualify the conditions and they should have rejected its bid. But for the reasons best known to them, they did not disqualify it and made it eligible for consideration of the tender for the award of works.
8. Mr. Ramana Reddy submits that the petitioner is a Class I contractor having rich experience in executing the works of high magnitude for the last 20 years. He has executed the works relating to the bridges, flyovers and other related structure works. He has executed about 40 bridges in Andhra Pradesh and all the works were executed within time of agreement and with high proficiency. At present, he is executing a work worth of over Rs. 21.00 crores for construction of bridges with approaches near Anagarvadi village in Upper Krishna Project near Almathi Dam in Karnataka State. At present, he is executing the flyover at Fatehnagar, Hyderabad.
9. Further he submits that he is the next lowest tenderer and his case has to be considered in preference to other qualified tenderers whose bids are higher than his bid. The poor performance and claims and bona fides of the 3rd respondent, were not considered by the 1st respondent. The 1st respondent is contemplating to accept the tender of the 3rd respondent and trying to entrust the work without verifying the mandatory pre-requisite qualifications even to submit the bid, which is arbitrary, illegal, unjust and unfair.
10. A common counter-affidavit has been filed on behalf of respondents 1 and 2. It has been submitted that Traffic and Transportation Sector are one of the components of the Hyderabad Mega City Project. The State level Sanctioning Committee constituted for this purpose under the said project, consisting of the nominees of the Central and State Governments and the Planning Commission of India and this Committee approved the construction of Flyover in the Twin cities of Hyderabad and Secunderabad in its Meeting held on 6.11.1995 and 8.1.1996.
11. It is stated that the Government of Andhra Pradesh has also accorded Administrative sanction for the Project vide orders No. 1, G.O.Ms. No. 463, MA, dated 10.11.1995, G.O.Ms. No. 55 MA, dated 8.2.1996 and 3; G.O.Ms. No. 114 MA, dated 8.3.1996. For quick and effective processing and speedy implementation of the works, while ensuring quality, a Technical-cum-Tender Committee has been constituted by the Government in G.O.Ms. No. 463, MA, dated 10.11.1995 with certain members. As per the decisions of the Technical-cum-Tender Committee, a notice was issued on 20.11.1995 calling for pre-qualification tenders to reach HUDA on or before 30.12.1995 for shortlisting and enabling to bid for construction of Flyovers/Bridges/Road over Bridges (ROBs). Some of the important terms and conditions to qualify for shortlisting are :
"(a) The contractors and Firms must have registered themselves with specified Government Departments/Organisations in construction of flyovers/bridges/ROBs.
(b) The works are to be taken up on turnkey basis.
(c) The works are tentatively grouped in six packages, each package containing two to three flyovers/bridges/ROBs.
(d) The approximate cost of each package of work will be around Rs. 20.00 crores;
3. Final tender documents would be issued to the shortlisted contractors and firms;
(e) The contractors/firms should have good experience with an Annual turn over of not less than Rs. 10.00 crores for a similar group of works in any one year of the preceding five years out of which the turn over for a single similar work should not be less than Rs. 3.00 crores and weightage is also fixed for assessing the present value of the turnover.
(f) The eligibility for the pre-qualification will be evaluated based on (a) Financial capability; (b) Technical capability; (c) Experience in construction of Flyover/Bridges/ROBs; and (d) Organisational capability;
(g) Contractors/Firms are required to furnish necessary data/documents along with their pre-qualification documents in support of each of the above capabilities indicated under (e) above, Data/Documents furnished shall be true in all respects.
(h) The zerox copies of certificates and other documents submitted with the tender should be tested by a Gazetted officer and also be signed by the applicant. The originals of the certificates shall be produced on demand within 3 days."
12. It is submitted that in response to this notice, 198 applications were received and the same number of documents were issued to the applicants. Only 63 Pre-qualification tenders were received. The Technical-cum-Tender Committee in their meetings held on 16.1.1996, 29.1.1996, 8.2.1996 and 18.2.1996, examined these documents. During the processing of examination, additional information and certificates received from the several applicants in support of their experience, turnover etc. have also been taken into consideration. After examining all the pre-qualification tenders, the Committee has shortlisted 27 contractors/firms.
13. It is stated that the Chit Tender Notice along with a letter dated 1.2.1996 were communicated to these 27 shortlisted contractors/firms for submitting tender bids specifically mentioning about re-grouping of package Nos. 6-5. The Chit Tender Notice also contains six packages; each package with three flyover/bridges/ROBs. The shortlisted contractors/firms include the petitioner and the 3rd respondent. A pre-bid meeting was also held on 6.4.1996 to clarify any doubts or points and the clarifications that were made, were also communicated to them vide letter dated 10.4.1996. Tenders were opened on 10.5.1996 and for package-6, 8 tenders were received including from the petitioner and the 3rd respondent. No objections were received from any tenderer. The technical evaluation of tenders was placed before the Technical-cum-Tender Committee. The details concerning the petitioner and the 3rd respondent are given in Annexure I to the counter affidavit.
14. It is admitted in the counter-affidavit that these respondents did receive a complaint from the petitioner dated 24.6.1996 to the effect that the 3rd respondent does not fulfil the above requirements of annual turnover of more than Rs. 10.00 crores in construction of Fluovers/Bridges/ROBs./Aqueducts or similar structures in any one year of the preceding 5 years and out of which turnover on a single similar work should be more than Rs. 3.00 crores, and if any certificate that were produced by Madhava Hi-tech Engineering Limited showing the above requirements for eligibility, they are false and the petitioner requested to verify the bona fides of the 3rd respondent in fulfilling the above requirements with the concerned Departments and to verify the authenticity of certificates before deciding on the contract work order for any package of works.
15. These respondents have taken steps to verify the truth and authenticity of the certificates and addressed letters to the concerned authorities in this regard enclosing the certificates said to have been issued by them. The said authorities have written back confirming the certificates and works done and also informed that the 3rd respondent is a reliable contractor. As such, it is submitted that there is no truth in the allegation of the writ petitioner. Copies of letters received from the authorities have been mentioned in Annexure II to the counter-affidavit. After receiving the reports and after examining all the facts and circumstances, the Technical-cum-Tender Committee on 4.10.1996 has considered the matter and having regard to the fact that the 3rd respondent''s tender being the lowest, recommended the acceptance of the tender. The 3rd respondent''s bid was Rs. 16,40,00,000 whereas the writ petitioner''s bid was Rs. 17,78,21.000 (sic) between the lowest and the 2nd lowest tender. On the recommendation of the Committee, acceptance letter was issued to the 3rd respondent on 5.10.1996 which was received by them on 7.10.1996.
16. It is further submitted that the Technical-cum-Tender Committee accepted the tender of the 3rd respondent having been found satisfactory that the firm has fully complied with the tender conditions and acted bona fide in the best interest of the Institutions. There are no valid grounds to interefere with the award of the contract in favour of the 3rd respondent and that it is prayed to vacate the interim orders passed in W.P. M.P. 26463/1996 on 9.10.1996 and dismiss the writ petition.
17. In the counter-affidavit filed by the 3rd respondent, it is stated that the 3rd respondent is a reputed firm well experienced in the execution of bridge works on South Central Railway apart from a variety of other works. It is a registered special class contractor with the State Government. It is on the approved list of contractors for execution of major works on Indian Railways. It has constructed about 30 bridges with P.S.C. Girders and about 9 major works have been mentioned apart from others given in the material papers. It is submitted that it is eminently experienced with proven record to carry out the works under package VI i.e., parallel bridge at Nayapool, Flyover at Masab Tank junction and flyover at Hari Hara Kala Bhavan in twin cities and basing on its record, the Technical-cum-Tender Committee consisting of high rank officials has evaluated the tenders. It is also submitted that the petitioner never raised any objection against it either at the time to pre-qualification stage or at the time of opening tenders on 10.5.1996. It is stated that realising that the petitioner has no chance to secure this tender, has obviously started making false representations, to the authorities with a view to prejudice them, the representations were also false, vexatious and devoid of merits. It is incorrect that the authorities have not taken any action on the representations of the petitioner. With regard to the abandoning of the work in a contract which is a reference to 1988 work, it is stated that a Civil suit in O.S. 632/1993 is pending on the file of the 1st Additional Judge, City Civil Court, Hyderabad and the matter is sub-judice. With regard to the pendency and turnover as per the requirements of the Tender document, it denies the allegations of the petitioner after narrating in brief the execution of works executed during the relevant period at paras 10 and 11. It is stated that it possesses valuable machinery the details of which have been mentioned in the material papers of the present work. On the other hand, the petitioner has executed only minor works at the relevant period and he has not completed the execution of the said works also till now and it is stated that it is reliably understood that the petitioner has no adequate means and machinery to carry out the work. The petitioner has not executed any bridge works with PSC with his own designs. He has no experience to execute the present works under Package IV. The machinery available with the petitioner is used only for the purpose of executing minor road earth work and minor bituminous works and it is not useful for execution of bridges and flyovers. With this kind of machinery, the petitioner cannot execute the works in question. Denying the other allegations, it is stated that its tender has been accepted by Technical-cum-Tender Committee having found, that it has fully complied with the tender conditions and the Tender Committee has acted bona fidely. It is prayed to vacate the interim order dated 9.10.1996 made in W.P. M.P. 26463 of 1996 in W.P. No. 21446 of 1996 and dismiss the writ petition with exemplary costs.
18. From the above pleas of the parties, it is evident that there is no dispute in proceedings between the parties from the date of the 1st respondent calling the pre-qualification tender notice dated 20.11.1995 till the opening of tenders on 10.5.1996; in respect of package VI works viz., a parallal bridge at Nayapool, (b) Flyover at Masab-Tank and (c) Flyover at Hari Hara Kala Bhavan, Secunderabad, the petitioner challenges on the ground that he is the second lowest tenderer and he has to be considered; but ignoring the same, the 1st respondent without verifying the poor performance of the 3rd respondent and the mandatory pre-requisite qualifications even to submit the bid, has accepted the tender of the 3rd respondent on 10.5.1996, which is arbitrary, illegal, unjust and voilative of Article 14 of the Constitution of India, as they are treating unequals as equals in the matter of experience as prescribed by them.
19. Mr. Ramana Reddy, Senior counsel, appearing for the petitioner submits that after opening of the tenders, the petitioner came to know that the 3rd respondent was the lowest tenderer. The petitioner has submitted representations before respondents 1 and 2 on 24.6.1996, 25.7.1996, 24.8.1996 and 4.9.1996 requesting them to verify the bona fides of the 3rd respondent regarding the fulfilment of requirements with the concerned Departments where R. 3 has done works and also authenticity of certificates produced by it for its eligibility for tendering bids, as the 3rd respondent has submitted incorrect and false documents and certificates and not qualified to submit the bid for package-VI. It has not executed the works worth not less than about Rs. 10.00 crores in any one year during the period 1990-91 to 1994-95. As the 3rd respondent does not fulfil the mandatory requirement of pre-qualification, the authorities should have rejected its tender. But, for the reasons best known to them, respondents 1 and 2 did not verify the false certificates and its authenticity, but made it eligible and accepted its tender.
20. Mr. Ramana Reddy also made a feeble attempt to the effect that the instructions in the pre-qualification document do not disclose the beginning or end of the year. He submitted that normally, the calendar year begins at first January and ends on 31st December and the Financial year begins from first April and ends on 31st March. But, after arguments on either side, he accepted that the period of one year referred to in clause 8(a)(ii) at page 15 of the Hyderabad Urban Development Authority-Pre-qualification document for construction of Flyovers/Bridges/ROBs in Twin cities of Hyderabad and Secunderabad (hereinafter referred to as the Document) should be reckoned from first of April.
21. Next he contended that in the certificates submitted by the petitioner (respondent), he took exception to the certificate issued by Mr. P. Seetharamaiah, M.E., M.I.E., Chief Engineer/Cons./Planning, Chief Engineer (Cons.) dated 19.7.1993. In the certificate, the Chief-Engineer has stated that Sri K. Madhava Rao, 12.13.245, Street No. 15 Tarnaka, Secunderabad-500 017 is a long-standing Contractor working on South Central Railway and borne on the approved list with experience of about two decades in execution of major Civil Engineering Works both in open line and construction organisation. In the said certificate, the Chief Engineer has also stated that Sri K. Madhavarao is also the Managing Director of M/s. Madhava Hi-Tech Engineers Private Limited working on S.C. Railway and executing works in his personal name also. They have been able to successfully complete major value works of complicated nature within the schedule time frame by virtue of their back-up organisation. They have also at their back-up organisation. They have also at their disposal skilled staff, financial resources and required plant and machinery. They have eminent consultants and specified the works undertaken by the 3rd respondent and also by Sri K. Madhavarao in his personal capacity and lastly it is stated that simultaneously with the above work, the value of which is Rs. 4.71 crores, Sri K. Madhavarao executed Reach II work on Secunderabad Mahbubnagar section for Guage conversion from M.G. to B.G. including strengthening of 26 bridges, the value of work being around Rs. 3.00 crores. Thus, he was able to execute works worth about Rs. 7,7 crores in a year in respect of these two works.
22. Similarly, he has taken exception to certificates issued by Mr. V. Kalikavatharam, Chief Administrative Officer (C) in CAO(C)/TA/Cont./Misc. dated 6.9.1993 with regard to the works undertaken by the 3rd respondent. He has taken exception to items 1 to 5 stating that only the particulars regarding Agreement Number, Overall value and date of completion are mentioned. But it is pertinent to note that the certificates issued by authorities belie his contentions.
23. It is significant to note that there is no plea raised in the affidavit filed in support of the writ petition nor the petitioner has filed any application to raise additional pleas before the court.
24. In such circumstances, there is no merit in the said contention.
25. The only dominant point to be considered is whether the respondents 1 and 2 authorities have scrutinside and evaluated the experience, works and certificates of the 3rd respondent as contemplated under instructions 8(a)(i) and (ii) of the Document which is extracted below :
"8(a) Separate tender documents for each package of works will be issued after short listing of Contractors/Firms. Contractors/Firms have to indicate clearly number of package of works and package numbers interested in tendering the works.
Following are the minimum requirements for applying for the single package of works.
(i) The Contractors/Firms should have experience in construction of Flyover/Bridges/ROBs/Aquaducts or similar structions.
(ii) The Contractors/Firms having good experience in similar type of works indicated above and an annual turnover of not less than Rs. 10.00 crores for a similar group of works in any one year of the preceding 5 years and out of which, turnover on a single similar work should not be less than Rs. 3.00 crores, are only eligible for the pre-qualification of the works mentioned in this office. Tender Notice No. HUNA/DEV/CE/GLU/9/95-96, dated 20.11.1995. The experience and turnover certified by the concerned Executive Engineer and countersigned by Superintending Engineer should be produced. For assessing the present value of the turnovers indicated by the firms, the following weightage factors will be applied
---------------------------------------------------------------------------- Year Weightage ---------------------------------------------------------------------------- 1990-91 1.46 1991-92 1.33 1992-93 1.21 1993-94 1.10 1994-95 1.00 ----------------------------------------------------------------------------
26. Mr. Ramana Reddy submits that the respondents 1 and 2 authorities have not properly considered those certificates filed by the 3rd respondent before permitting him for pre-qualification which entitles him to tender the bids and the tender should have been rejected.
27. Mr. Kannabhiran, Senior counsel appearing for 3rd respondent and Mr. N. Subba Reddy appearing for respondents 1 and 2 contend that t consider the eligibility of the 3rd respondent, suitable experience in construction of flyovers/bridges/ROBs and pre-qualified it on the authenticated documents and certificates submitted by it.
28. Mr. Subba Reddy, learned Senior Counsel submits that after receipt of representations from the petitioner after the opening of the tenders, i.e., on 10.5.1996, the 1st respondent has verified the genuineness of the certificates issued by the various authorities wherein the value of the works and the nature of the works executed by the 3rd respondent are mentioned and the respondents 1 and 2 have filed copies of correspondence with the authorities who have issued the certificates in favour of the 3rd respondent, which have been filed in the material papers in Annexure II from pages 59 to 70. A perusal of the said correspondence in Annexure II clearly establishes theauthenticity and genuineness of the certificates produced by the 3rd respondent before it was pre-qualified for tendering.
29. Mr. Ramana Reddy, learned Senior Counsel appearing for petitioner submitted that the pre-qualification tenders were received on 30.12.1995. The Tender-cum-Technical Committee met four times during 16.1.1996 and 18.2.1996 and evaluated the qualifications of the 3rd respondent while actually the certificates were received in September, 1996 and hence the pre-qualification/shortlisting of the 3rd respondent is wrong and the 3rd respondent has no experience in construction of flyover/bridges/ROBs. In reply to this Mr. N. Subba Reddy, learned Senior Counsel for respondents 1 and 2 submitted that as per conditions of pre-qualification, the Tenderers were to submit necessary documents including the experience certificate issued by the Competent authorities along with pre-qualification tender. The 3rd respondent too, like others submitted the tender. In all 63 pre-qualification tenders were received but the Committee in its meeting held on 18.2.1996 pre-qualified or shortlisted only 27 tenderers including the petitioner and the 3rd respondent. It is only because the petitioner complained on 24.6.1996 about the authenticity of the certificates produced by the 3rd respondent, the HUDA addressed the concerned authorities on 12.7.1996 for confirmation and their opinions and got confirmation from them. Again because the petitioner complained on 25.7.1996 and 24.8.1996, the concerned authorities were again addressed on 3.9.1996 for specific confirmation of the experience and got the replies confirming the same. The various certificates produced by the 3rd respondent evidence that the respondent has got experience and built the same not only during the last five years but also earlier to these years also pre-qualified during the year by the Railway Authorities to do the same work. It is further submitted by Mr. Subba Reddy that the evaluation was done by the High Power Committee called Technical-cum-Tender Committee constituted by the Government for the purpose of quick and effective processing and speedy implementation of the works, while ensuring quality consisting of the following members :
(1) Engineer-in-Chief (World Bank Projects) Roads and Buildings Department.
(2) Engineer-in-Chief-Hyderabad Metropolitan Water Supply & Sewerage Board.
(3) Chief Engineer, Municipal Corporation of Hyderabad.
(4) Joint Secretary to Government, Finance Department.
(5) Chief Engineer, HUDA (Conveynor).
30. The Tender-cum-Technical Committee met on 4.10.1996 and considered the complaints of the petitioner and the replies received from the authorities who issued the experience certificates to the 3rd respondent and then decided to award the contract to the 3rd respondent whose is the lowest tender which is less than tender of the petitioner by about Rs. 1.38 crores.
31. Mr. Ramana Reddy, Senior Counsel appearing for the petitioner relied on a decision
"On a proper construction what the notice required was that only a person running a registered II class hotel or restaurant and having at least 5 years'' experience as such should be eligible to submit a tender. This was a condition of eligibility and it is difficult to see how this condition could be said to be satisfied by any person who did not have five year''s experience of running a IInd Class hotel or restaurant. The test of eligibility laid down was an objective test and not a subjective one."
Next he relied on a decision reported in
"7 - In contractual sphere as in all other state actions, the State and all its instrumentalities have to conform to Art. 14 of the Constitution of which non-arbitrariness is a significant facet. There is no unfettered discretion in public law. A public authority possesses powers only to use them for public good. This imposes the duty to act fairly and to adopt a procedure which is "fairplay in action." Due observance of this obligation as a part of good administration raises a reasonable or legitimate expectation in every citizen to be treated fairly in his interaction with the State and its instrumentalities with this element forming a necessary component of the decision-making process in all State actions. To satisfy this requirement of non-arbitrariness in a State action, it is, therefore, necessary to consider and give due weight to the reasonable or legitimate expectations of the persons likely to be affected by the decision or alse that unfairness in the exercise of the power may amount to an abuse or excess of power apart from affecting the bona fides of the decision in a given case. The decision so made would be exposed to challenge on the ground of arbitrariness. Rule of law does not completely eliminate discretion in the exercise of power, as it is unrealistic, but provides for control of its exercise by judicial review.
8. The mere reasonable or legitimate expectation of a citizen, in such a situation may not by itself be a distinct enforceable right, but failure to consider and give due weight to it, may render the decision arbitrary and this is how the requirement of due consideration of a legitimate expectation forms part of the principle of non-arbitrariness, a necessary concomitant of the rule of law. Every legitimate expectation is a relevant factor requiring due consideration in a fair decision-making process. Whether the expectation of the claimant is reasonable or legitimate in the context is a question of fact in each case. Whenever the question arises it is to be determined not according to the claimant''s perception but in a larger public interest wherein other more important considerations may outweigh what would otherwise have been the legitimate expectation of the claimant. A bona fide decision of the public authority reached in this manner would satisfy the requirement of non-arbitrariness and withstand judicial scrutiny The doctrine of legitimate expectations gets assimilated in the rule of law and operates in our legal system in this manner and to this extent."
Next he relied on a decision reported in
"It is true that by way of judicial review the Court is not expected to act as a court of appeal while examining an administrative decision and to record a finding whether such decision could have been taken otherwise in the fact and circumstances of the case. In the book Administrative Law, Prof. Wade has said :
"The doctrine that powers must be exercised reasonably has to be reconciled with the no less important doctrine that the Court must not usurp the discretion of the public authority which Parliament appointed to take the decision. Within the bounds of legal reasonableness is the area in which the deciding authority has genuinely free discretion. If it passes those bounds, it acts ultra vires. The court must therefore resist the temptation to draw the bounds too tightly, merely according to its own opinion. It must strive to apply an objective standard which leaves to the deciding authority the full range of choices which legislature is presumed to have intended. The decisions which are extravagant or capricious cannot be legitimate. But if the decision is within the confines of a reasonableness, it is no part of the court''s function to look further into its merits. With the question whether a particular policy is wise or foolish the court is not concerned; it can only interfere if to pursue it is beyond the powers of the authority."
32. Relying upon the above decisions of the Apex Court, Mr. Ramana Reddy submitted that the respondent authorities failed to scrutinise the documents and the certificates in correct perspective; as such, there is infirmity in the decision and they have arbitrarily came to the conclusion that the 3rd respondent did satisfy the preconditions prescribed under instruction 8(a)(i) and (ii) of the Document.
33. With regard to the acceptance of certificates supplied by the tenderer-Sufficiency-Justiciability, it is observed that Notification inviting tenders for construction work-pre-qualifications of tenderer for issue of tender forms-Experience in insulation and brick work Certificate given by prospective tenderer about his work experience-sufficiency to be decided by authority calling tenders and not by court, for which Mr. N. Subba Reddy relied on a decision
"The principles deducible from the above are :
(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 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.
(4) The terms of invitation to tenderer cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts.
(5) The Government must have freedom of contract. In other words, a fairplay 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 effected 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."
He has also relied on a Division Bench Judgment of this Court reported in
"No statutory provision or regulation challenged-Objection raised is only that Board has not followed terms of tender specification-Objection not raised by appellant at the time of evaluation of price bids before the Board when tender of 4th respondent was considered-Appellant not entitled to raise objection in that respect in court after the he lost award of Contract."
34. In the instant case, based on the anvil of the principles laid down by the Apex Court in the above decisions, with regard to the aspect whether the awarding of tender suffers from the infirmity of pre-qualifications and the process making decision is arbitrary, I examined the process of the decision undertaken by respondents 1 and 2 below :
"As already stated, there is no dispute between the parties with regard to the facts from the date of tender Notification No. HUDA/DEV/CE/GLU/9/95-96 dated 20.11.1995 and the Chit Tender Notice No. HUDA/DEV/CE/GLU dated 1.3.1996 wherein item-C for package VI is included, bid conference held on 6.4.1996 and the opening of tenders on 10.5.1996 in the presence of representatives of the tenderers. No objection, whatsoever was raised by the petitioner. It is only when the petitioner lost the tender being the second lowest, he has filed representations to respondents 1 and 2 on 24.6.1996, 25.7.1996, 24.8.1996 and lastly on 4.9.1996. Following the decision reported in Bhanu Construction Co. Ltd. v. A.P. State Electricity Board, (stated supra), it can be said that the objection of the petitioner, which is belated and after opening of the tenders, does not merit any consideration and apart from this, the 1st respondent has addressed letters to the concerned Chief Engineer, Construction/Planning, South Central Railway on 3.9.1996, another letter to the Chief Administrative Office (C) South Central Railway, Secunderabad on 3.9.1996 and another, letter to the Chief Engineer/Dy. Chief Engineer, Konkan Railway Corporation Limited Panaji, Goa on 3.9.1996 to the effect that the 3rd respondent is one of the tenderer who has tendered for the above works and produced various certificates issued by their department and before its offer is considered, it is desired that the information and certificates furnished by it needs confirmation from the concerned. Further, it was also requested to furnish their views on its performance on the projects executed under their Department in the past. In response to which, the Chief Engineer/Constructions, South Central Railway, Secunderabad sent a letter to the 1st respondent on 9.9.1996 stating that the certificate issued by Sri P. Seetharamaiah Chief Engineer/Con/Planning (Retd.) is bona fide and issued by him and the 3rd respondent is financially sound, dependable and capable of executing major bridge works with their designs. Dy. Chief Engineer, Konkan Railway Corporation Limited, Canacona sent a confirmation letter on 15.9.1996 stating that he is confirming the contents of certificate issued by the office. Likewise, the Chief Administrative officer. South Central Railway Secunderabad also sent a letter on 27.9.1996 to the 1st respondent stating that the certificate issued by V. Kalikavatharam, CAO/Con/SC (Retd.) is bona fide and issued to 3rd respondent."
35. The respondents 1 and 2 have filed Annexure 1 and 2 along with their counter affidavit. They are at pages 57 to 70 in material papers. Annexure I is the comparative Statement showing the experience, turn over and bids tenders for package VI by the petitioner and the 3rd respondent. Annexure-II contains the above correspondence. A perusal of Annexure I at pages 57 and 58 of the material papers, vividly explains the turn over of single similar work in a year of 3rd respondent is more than Rs. 3.00 crores and its annual turn-over in the construction of group work is more than Rs. 10.00 crores which satisfied the conditions laid down in instruction 8(a)(i)(ii) of the Document. It is specifically stated in the counter affidavit of respondents 1 and 2 at paras 5 and 7 that the technical evaluation of the tenders was got done by the Jawaharlal Nehru Technological University. The technical and financial evaluation of the tenders were placed before the Technical-cum-Tender Committee. It is stated in para 2 of the counter affidavit of respondents 1 and 2 that this High Power Technical-cum-Tender Committee has been constituted by the Government in G.O.Ms. No. 463 MA dated 10.11.1993, G.O.Ms. No. 55, MA, dated 8.2.1996 with five members. The Committee has also considered the representations of the petitioner and the replies received from the authorities who issued the certificates to the 3rd respondent and then decided to award the Contract to the 3rd respondent which is the lowest tenderer and which is less than the tender of the petitioner by about Rs. 1.38 crores, which is specifically stated at paras 2, 5 and 7 of the counter-affidavit of respondents 1 and 2. Basing the criteria that the court does not have the expertise to correct the technical decision. If a review of such decision is permitted it will be substituting its own decision without the necessary expertise which itself may be fallible. The terms of invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract.
36. In the light of the above facts and the principles laid down by the Apex Court, I have no hesitation to hold that the decision to accept the tender of 3rd respondent has been reached by fair process, without discrimination and with intrinsic merits in accordance with condition-8(a)(i)(ii) of the Document and not actuated by bias or mala fides.
37. Apparently, the petitioner has not pointed out any arbitrariness that is affected by biased or acted by mala fides in awarding the contract to the 3rd respondent.
38. In view of my above findings, the petitioner has not substantiated his case; as such, the writ petition lacks merits and deserves to be dismissed.
39. In the result, the writ petition is dismissed with costs. Advocate fee Rupees 5,000.
40. Petition dismissed.
