C.V. Nagarjuna Reddy
1. This Writ Petition is filed for a Mandamus to set aside proceedings in letter No. SE/TL&SS/MC/Hyd/ADE (T)/AE2/F:TRE/D.No: 2527/12 dated 22.09.2012 issued by respondent No. 1 based on letter No. CE/MZ/Hyd/ADE(T)/AE1/D. No. 802/12 dated 28.06.2012 of respondent No. 2. The petitioner sought for a consequential direction to the respondents to accept the security deposit by way of bank guarantee as per the tender specification. The petitioner submitted its tender in response to a tender notice issued by the respondents for carrying out TRE assistance on works contract basis for the period from 01.07.2012 to 31.03.2014. It is the pleaded case of the petitioner that it has furnished bank guarantee as bid security for the sum equivalent to 2% of the estimated cost. The petitioner emerged as the successful bidder. Respondent No. 1 has addressed letter dated 22.09.2012 to the petitioner wherein while stating that after adjusting the bank guarantee furnished by it, the petitioner has to pay the balance security deposit of Rs. 30,246/- in the shape of demand draft drawn on any scheduled Bank. Feeling aggrieved by the condition stipulated by respondent No. 1 relating to furnishing of balance security deposit amount in the shape of demand draft instead of permitting the petitioner to furnish bank guarantee, the present writ petition is filed.
2. At the hearing, Mr. P.R. Balarami Reddy, learned counsel for the petitioner submitted that under Clause 7 of the tender conditions, the petitioner is liable to furnish bid security amount in the form of bank guarantee or crossed demand draft and that the petitioner having already furnished the bank guarantee, it is not liable to pay the amounts by way of demand draft. He further submitted that even if the petitioner is liable to pay the security deposit amount in excess of the bank guarantee already furnished by way of bid security, the same can be demanded only in the form of bank guarantee and not by way of cash in the shape of demand draft.
3. Mr. O. Manohar Reddy, learned standing counsel for APCPDCL appearing for the respondents submitted that under Clause 9 of the tender conditions, the successful tenderer has to pay the security deposit at 5% of the agreement value. He, therefore, submitted that the option given to the petitioner for furnishing security by way of bank guarantee or demand draft was confined only to bid security and the same does not extend to security deposit.
4. In order to resolve this controversy, it is appropriate to reproduce Clauses 7 and 9 of the tender conditions hereunder:
Clause 7 - Bid Security
Bid security as indicated at Annexure-V in the form of Bank guarantee or Crossed Demand Draft on any schedule bank drawn in favour of the respective Superintending Engineer/TL & SS as indicate at Annexure-V should be enclosed to the Tender. Tenders not accompanied by such drafts towards Bid security will be rejected. The Bid security will be refunded in the case of unsuccessful tenders after finalization of tenders and it will not carry any interest. "The 2% bid security amount (EMD amount) is for a period of one year only on the total estimated cost of the work even though the tenders are being called for awarding the works for more than one year".
Bid security in case of successful tenders will be adjusted towards security deposit.
Tenderers belonging to individuals & the Registered Societies belonging to Wadderas i.e., SC, ST are exempted from payment of bid security at the time of submission of tender up to the value of tender of Rs. 20.00 lakhs taking the value of tender for one year. But they must submit necessary proof in support of their belonging to SCs, STs or Wadderas societies & individuals. However, if the value of tender exceeds Rs. 20.00 lakhs taking the value of tender for one year, they should pay bid security on total value of the work.
In respect of Man Power Co-operative Societies whose Security Deposits are available against running contracts will be adjusted towards Bid Security. If the above Security Deposits are not sufficient the respective societies have to pay the balance amount towards Bid Security by way of BG/DD.
The adjusted Security Deposit amount will be retained by APTRANSCO till the finalization of tenders and Agreements entered into.
The Bid security will be forfeited in the following cases:
1. If the Tenderer does not produce the labour (to be engaged under the Works Contract) within stipulated time on issuing of the direction by the Field Engineer of APTRANSCO.
2. When the successful tenderer does not accept the order after issue of letter of intent/acceptance letter.
3. When the successful tenderer fails to furnish the proof of payment towards security deposit within specified period after issue of letter of intent/acceptance letter.
4. When the tenderer alters his prices or withdraws his offers during the validity period.
5. APTRANSCO reserves the right to decide and award the work elsewhere in the exigency under (1) to (4).
6. When the successful tenderer fail to furnish EPF, ESI code numbers and service tax registration.
Clause 9 - Security Deposit
The successful Tenderer have to pay Security Deposit @ t% of the agreement value of works. The Security Deposit will be released after three months after satisfactory completion of work entrusted, which will not carry any interest. The Security Deposit shall be forfeited if the tenderer does not fulfill the terms and conditions of the works contract.
5. From a reading of the above-mentioned clauses, it is evident that bid security has to be furnished by all the tenderers, while security deposit has to be paid by the successful tenderers. Clause 7 dealing with bid security gave option to furnish security @ 2% of the estimated cost of the work either in the form of bank guarantee or crossed demand draft. However, in respect of the successful tenderers, they have to pay the security deposit @ 5% of the agreement value of the works. No option as provided to the tenderers for payment of the bid security has been made available to the successful tenders in the matter of payment of security deposit under Clause 9. The only consideration that was shown in respect of the successful tenderers is adjustment of bid security towards security deposit. Under the impugned letter, such adjustment of bank guarantee already furnished by way of bid security has been made and it is only the balance amount which has been demanded towards the security deposit. In my opinion, the impugned demand is in consonance with the tender conditions referred to above and, hence, the same does not call for interference of this Court.
6. For the above-mentioned reasons, the Writ Petition is dismissed. As a sequel to dismissal of the writ petition, W.P.M.P. No. 38546 of 2012 is disposed of as infructuous.
