Jharkhand High Court
Sm & Snr (Jv) vs Bharat Coking Coal Ltd. Through The ... on 17 November, 2022
Author: Aparesh Kumar Singh
Bench: Aparesh Kumar Singh, Deepak Roshan
IN THE HIGH COURT OF JHARKHAND AT RANCHI
W.P (C) No. 4387 of 2021
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SM & SNR (JV), a Joint Venture Firm of M/s Sunrise Movers and M/s Singh Natural Resources Private Ltd., Dhanbad through the Authorized signatory Radha Bhattad --- --- Petitioner Versus
1. Bharat Coking Coal Ltd. through the Chairman-cum-Managing Director, Dhanbad
2. The Chairman-cum-Managing Director, Bharat Coking Coal Ltd., Dhanbad
3. The General Manager, Contract Management Cell, Bharat Coking Coal Ltd., Dhanbad
4. M/s MJM-RSSG-DS (JV) through Dadan Singh --- --- Respondents CORAM: Hon'ble Mr. Justice Aparesh Kumar Singh Hon'ble Mr. Justice Deepak Roshan
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For the Petitioner: M/s Navniti Prasad Singh, Sr. Advocate,
Aditya Shekhar, Baibhaw Gahlaut, Advocate
For the Resp.-BCCL: M/s Amit Sharma, A.K. Das,
Kanisha Deo, Advocates
For the Respondent No. 4: M/s Ajit Kumar, Sr. Advocate, Tanya Singh, Advocates
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15 / 17.11.2022 The writ petition was preferred with the following prayer:
A. Quashing of the Letter of Acceptance dated 20.10.2021 (Annexure
4) issued under the signature of General Manager (CMC), Bharat Coking Coal Limited by which tender (NIT No-BCCL/CMC/F-e NIT/Coal/Tptn43/Bastacolla/2021/182 dated 29.05.2021) for work of "Long Term Coal Transportation including crushing of coal from different sources of Bastacolla Area, BCCL to BNR Siding BCCL including allied jobs" has been awarded to the Respondent No. 4 despite the fact that the Independent External Monitors on 17.10.2021 have decided to conduct an enquiry regarding the said tender and have directed to not to finalize the tender till the completion of the enquiry and the submission of the report of the Independent External Monitors.
2. Earlier, the matter was taken up by the learned single Judge since the subject matter of the writ petition was assigned to the learned single Bench. When the matter was taken up on 29.10.2021 on I.A. No. 6218/2021, learned single Judge did not stay the tender in question, but made it subject to the final outcome of the writ petition. Respondent No. 4 was issued notices on the same day while the Respondent BCCL was granted time to file counter affidavit. Since the Respondent No. 4 did not appear even after notice and instructions conveyed through BCCL, bailable warrant was issued upon him by the learned single Judge on 20.07.2022. Thereafter, it has appeared and filed a counter affidavit also on 07.09.2022.
23. However, in view of the standing instruction dated 01.08.2022 issued by the Hon'ble Chief Justice, matters relating to grant of tender in public service have been assigned to the Division Bench. Therefore, the matter was posted before this Bench on 07.09.2022. Upon hearing the learned counsel for the parties at length, the gist of the case of the petitioner was recorded in the order dated 07.09.2022 which is extracted hereunder:
e-Notice Inviting Tender dated 29th May, 2021 was floated by the Respondent-BCCL for 'Long Term Coal Transportation' including crushing of coal from different sources at Bastacolla Area, BCCL to BNR Siding of BCCL including allied jobs for an estimated value of Rs. 150,78,88,016/-. The stipulated period of work was 1278 days. Petitioner was disqualified during technical evaluation by the duly constituted committee for the reason that 'Joint Venture SM and SNR(JV)' was not in existence before the JV Agreement dated 18th June, 2021, which makes all other documents such as Annexures-O, Annexure-B, Annexure-N, Annexure-P, etc. invalid and non-existent in the eyes of law. Petitioner complained to the Independent External Monitor (IEMs), who vide his communication dated 17th October, 2021 (Annexure-3/A), opined that the tender should not be finalized till completion of the enquiry and submission of the reports of IEMs.
2. Be it be noted here that Annexure-H is the INTEGRITY PACT i.e., PRE-CONTRACT INTEGRITY PACT, part of the tender document to be signed both by the employer and the bidders. The first recital thereof reads as under:
"To avoid all forms of corruption by following a system that is fair, transparent and free from any influence/prejudiced dealings prior to, during and subsequent to the currency of the contract to be entered into with a view to."
Section 2 relates to Commitments of the Bidder(s)/Contractor(s) and provides for the enumerated undertakings, to which the bidders have to commit themselves during participation in the tender process and during execution of the contract. Section 6 thereof provides for equal treatment to all Bidders/Contractors/Subcontractors. It stipulates that the principal employer will enter into the agreement with all Bidders and Contractors with identical conditions. Section 8 thereof provides the duties and responsibilities of the Independent External Monitor.
3. The Forum of Independent External Monitor was invoked by the petitioner through his representation dated 13th October, 2021 upon being technically disqualified (Annexure-3). During technical evaluation of bids of all 17 bidders, 8 bidders were disqualified. The financial bids were opened thereafter. Respondent no. 4 was found to be lowest bidder having quoted price of Rs. 122,89,28,733/-. Letter of Acceptance was issued upon respondent no. 4 on 20th October, 2021 (Annexure-4 to the writ petition/Annexure-1 to the counter affidavit of respondent no.4). Work order was issued upon respondent no. 4 on 24th October, 2021. The writ petition was filed on 25th October, 2021. By order dated 29th October, 2021, the award of work in favour of the respondent no. 4 was made subject to the outcome of the writ petition by learned Single Judge.
4. Be it noted here that on account of Standing Instruction dated 1st August, 2022 issued by Hon'ble the Chief Justice, all 3 tender matters are to be heard by the Division Bench. That's why the matter has been placed before this Bench after assignment of roster.
5. Meanwhile Independent External Monitors were undertaking the exercise on representation of the petitioner. BCCL also participated therein and its submissions are noted by the Independent External Monitors as enclosed in their counter affidavit. The Independent External Monitor took note of the stand of the BCCL that once the bidder had signed the Integrity Pact, it should not have approached the Court. Having represented the matter before the IEMs, they should have waited for their decision in the matter. BCCL also submitted its comments on the merits of the complaint relating to disqualification of the technical bid of the petitioner. The Independent External Monitor conveyed their opinion on 28th November, 2021 to the Chairman and Managing Director, BCCL, Dhanbad on 20th November, 2021 in the following terms:
"Conclusion In view of the pending case before Hon'ble High Court of Jharkhand and taking cognizance of the award of the tender by BCCL, the IEMS decided to refrain from offering any opinion at this stage."
6. Learned senior counsel for the petitioner submits that the rejection of the technical bid by the Respondent-BCCL on the ground that Joint Venture was not in existence before the JV Agreement dated 18th June, 2021 and all other documents such as Annexure-O, Annexure-B, Annexure-N, Annexure-P etc. were invalid and non-existent in the eyes of law, is a ploy / subterfuge to disqualify the petitioner / bidder as such correction in the date of the Joint Venture agreement executed on 15th June, 2021, notarized on 18th June, 2021 was made at the request of the employer, BCCL, as per Annexure 1/A at page-147, which is as under:
"You are requested to submit the following - i. Rectified Copy (date mismatch) of JV agreement by the concerned Notary Public who has notorized the JV Agreement earlier. Ii. Affidavit or any other document to prove proprietorship/Individual status of the firm which should be valid on the day of Bid Submission by the bidder."
7. The bidder was disqualified on technical grounds as the authorization in favour of one of the Directors of the Joint Venture was treated to be invalid having been executed on 17th June, 2021 i.e. before the notarization of Joint Venture agreement on 18th June, 2021 i.e. cut-off date for submission of the bid.
8. Learned senior counsel for the petitioner submits that if the petitioner was allowed to participate in the financial bid, its bid would have been the lowest i.e. 24.52% below the estimated value of Rs.150.78 Crores. Its bid was Rs. 9.00 crore (approximately) lower than the bid quoted by the respondent no. 4. Therefore, petitioner approached this Court.
9. Respondent-BCCL has filed counter affidavit. Respondent no. 4 has also appeared and filed its counter affidavit today. Both the respondents have defended the award of work in favour of respondent no.4. Respondent no. 4 has indicated that it is executing the work since November, 2021. Coal Transportation schedule (work schedule) from November, 2021 till May 2023 has been enclosed as Annexure-3 showing varying amounts of quantity of coal to be transported in each month. Respondent no. 4 had also submitted performance guarantee to the tune of Rs. 1,05,29,000/- and odd before award of work.
410. Upon consideration of the relevant materials borne from the record taken note above, we find that the Independent External Monitors have laid off their hands on the enquiry only for the reason that the matter is sub-judice before this Court. Independent External Monitors have been appointed as per the tender documents. Every bidder including the petitioner and the respondent no. 4 must have signed the Integrity Pact. The object of the entering into Integrity Pact was to ensure that the tender process is undertaken in a fair and transparent manner and is not influenced by any dealings prior to, during and subsequent to the currency of the contract to be entered into. The bidders were also required to give an undertaking as per Section 2 thereof and all bidders were to be treated equally as per Section 6 of the Integrity Pact. The Independent External Monitors, in fact, on 17th October, 2021 before award of Letter of Acceptance in favour of the respondent no.4, opined that the tender should not be finalized in favour of any tenderer. We do not find any reason as to why the Independent External Monitor should have kept the inquiry in abeyance only on account of the fact that the petitioner has approached this Court. Independent External Monitors are experts in their field nominated by Central Vigilance Commission to act as a watchdog in award of tender in such contracts as per Section 8 of the Integrity Pact.
11. Therefore, we are of the considered view that the Independent External Monitor should arrive at a considered opinion after due enquiry in respect of the issues raised before it by the petitioner. The report of the Independent External Monitor though being recommendatory in nature, has substantive value. BCCL would submit that report before this Court. Let such a report be submitted within a period of 2 weeks.
12. Since the work has progressed from November, 2021 till date, in order to secure the interest of the employer as well as to have the commitment of the petitioner to undertake the work if it ultimately succeeds, we deem it proper to direct the petitioner to make a deposit of amount of Rs. 2.5 Crore with learned Registrar General within two weeks through a demand draft. Learned Registrar General would keep the amount in an interest bearing account.
13. Matter be listed on 27th September, 2022.
Let a copy of this order be handed to the learned counsel for the Respondent-BCCL by tomorrow.
4. It appeared to this court that the Independent External Monitors ('IEMs' in short) had been in seisin of the matter and vide communication dated 17.10.2021, IEMs had opined that tender should not be finalized till completion of the inquiry and submission of the reports of IEMs. However, later on as per their opinion dated 20.11.2021, the inquiry was put in abeyance on account of filing of the instant writ petition. This court, upon hearing the parties on 07.09.2021, was of the view that the IEMs being experts in their field, nominated by the Central Vigilance Commission to act as a watchdog in award of tender in such contracts, as per Section 10 of the INTEGRITY PACT, should have arrived at a considered opinion after due inquiry in respect of the issues raised before it by the petitioner. This court also directed the petitioner to make a deposit of Rs. 2.5 crore before the learned Registrar 5 General of this court in order to secure the interest of the Employer as also to ensure commitment of the petitioner to undertake the work if it ultimately succeeds. Deposits were made by it. The final opinion of the IEMs were brought on record through an affidavit dated 22.09.2022, taken note of in the order dated 27.09.2022. The IEMs held that the rejection of the bid of the petitioner on 12.10.2021 was bonafide on merits and facts on record. Its conclusions are extracted hereunder :
(i) there is no evidence to indicate that the JV agreement was finalised and concluded by the JV partners prior to 18-6-2021;
(ii) the bid of the complainant was invalid as the annexures required to be submitted under the NIT, were signed and submitted on 17-6-2021 i.e. prior to the formation/finalisation of the JV as a legal entity;
(iii) the rejection of the bid of the JV/complainant by the tender committee on 12-10-2021 was bonafide on merits and facts on record;
(iv) the complainant's claim that they/the JV, felt mislead by the suggestion of the tender committee to re-submit the original document rectified as they did, may be deemed as misplaced.
During the Hearing on 13-9-2022, Shri Bharati explained that they suggested rectification based on their understanding that at the time of executing a notarised document, the signatories have to be present before the Notary. By suggesting rectification, BCCL was in fact giving an opportunity to them to clarify the shortfall/lacuna that was perceived by the tender committee. If no rectification the heading of the JV agreement was necessary, the complainant/JV should have pointed out in their response; and
(v) the role of IEMs is to ensure that integrity of the tender process is maintained. In the instant case, the IEMs are of the considered view that, the tender committee has not deviated from this fundamental requirement and the grievance of the complainant has been dealt with in essence, fairly.
5. This court after hearing the counsel for the parties on 27.09.2022, felt it necessary to be informed about the exact Financial Bid quoted by the writ petitioner. His Financial Bid had remained unopened because he was disqualified in the Technical Bid. Learned counsel for the BCCL was asked to bring on record a comparative chart of the Financial Bids of the technically qualified bidders and also the Financial Bid of the petitioner which had been kept unopened vide order dated 27.09.2022. However, on the next date i.e. 13.10.2022, BCCL expressed its inability to produce the Financial Bid of the petitioner since the tender portal of CIL was maintained by NIC. The comparative chart of price quoted by the technically qualified bidders were furnished vide Annexure-A to the affidavit dated 10.10.2022. It appeared to this court that no formal request had been made to NIC by the BCCL to furnish the Financial Bid of the petitioner. On the request of the learned 6 counsel for the BCCL, the matter was adjourned to 02.11.2022 so that they can make a request to the NIC to provide Financial Bid of the petitioner which had remained unopened due to his technical disqualification. The Financial Bid of the petitioner has been furnished in sealed cover on 02.11.2022. Learned counsels for the parties have advanced their submissions and the case has been posted today. The sealed cover has been opened today.
6. On the basis of the pleadings on record, the issue posed for consideration before this court is, whether the rejection of the Technical Bid of the petitioner on the grounds contained in the letter dated 12.10.2021 (Annexure-2) was proper in the eye of law or not?
As has been taken note of in the order dated 07.09.2022, the Technical Evaluation Committee had pointed out the following defects to be rectified by the petitioner.
"You are requested to submit the following - i. Rectified Copy (date mismatch) of JV agreement by the concerned Notary Public who has notorized the JV Agreement earlier. Ii. Affidavit or any other document to prove proprietorship/Individual status of the firm which should be valid on the day of Bid Submission by the bidder."
7. Petitioner acting thereupon, made a correction in the date of the execution of the joint venture agreement from 15.06.2021 to 18.06.2021, the date on which the joint venture agreement was notarized and the bid was submitted. As a result of such correction, the bidder was disqualified on technical grounds as the authorization in favour of one of the directors of the joint venture was treated to be invalid having been executed on 17.06.2021 i.e. before the notarization of joint venture agreement on 18.06.2021, the cut- off date for submission of the bid. The reason for rejection of the technical bid was on the ground that joint venture was not in existence before the JV agreement dated 18.06.2021 and as such, all other documents such as Annexure-O,B,N,P were invalid and non-existent in the eye of law. As per the Clause 2.1 of Instruction to Bidders (ITB) under the Standard Bidding Document (SBD), Joint Venture / consortium were also eligible to participate in the bid if they fulfil the qualifying / eligibility criteria specified in tender notice. The format of joint venture agreement was enclosed as an Annexure-L The terms and conditions under the Standard Bidding Document and Instructions to Bidders, also relied upon by learned counsel for the Respondent BCCL and the Respondent no. 4 such as Clause 2 relating to Eligibility of Bidders, Clause 20 relating to Technical Evaluation of Tender 7 and Clause 22 relating to the Employer's right to accept, negotiate and reject any or all the bids do not indicate that there was any requirement for any joint venture agreement to be notarized before its submission. Petitioner submitted the joint venture agreement however duly notarized by the Notary Public, (which is at page 153 to 159). The joint venture agreement originally submitted by the bidder contained the date 15.06.2021 at the top of the first page and at the last page 159 also. It was indicated that the parties have under their respective hands and seals executed it on the day, month, year first above written. It is true that the format of the joint venture agreement (at page 137 to 141 of the writ petition), part of the Instruction to Bidders, required the parties to endorse their signature with official seal and also provide the place and date of execution. The witnesses were required to inscribe their signature only. However, this was not the defect pointed out by the Technical Evaluation Committee, rather the defect, quoted above, was in respect of a date mismatch of the joint venture agreement by the concerned notary public who has notarized the JV agreement earlier. The mismatch had occurred because though, the joint venture agreement was executed between the parties on 15.06.2021, but it was notarized on 18.06.2021 (though it was not necessary as per the Instruction to Bidders under the SBD). The petitioner on being requested to make the necessary correction had thereafter got the date at the top in the first page of the joint venture agreement (at page 153 of the writ petition) from 15.06.2021 to 18.06.2021. What happened as a result of such correction was that the Tender Evaluation Committee treated the date of execution of the joint venture agreement as 18.06.2021 and consequently other document such as Annexure-O (affidavit dated 17.06.2021), Annexure-B (affidavit dated 17.06.2021), Annexure-N (format for declaration and Annexure-P (Undertaking ) (Format of which are at page 167, 164, 143, 145) were deemed invalid having been executed prior to formation of joint venture agreement. The cut-off date for submission of the bid was 18.06.2021. As such, these documents could not be resubmitted by the petitioner, nor were they asked to be rectified. However, such correction made by the petitioner on being asked by the Technical Evaluation Committee became the bane of the petitioner as his bid was held to be technically disqualified. It is also true that the petitioner complained before the IEMs on 13.10.2021, one day after his bid was declared technically disqualified (Annexure-3). Thereafter, IEMs did ask the BCCL to refrain from finalizing the tender on 17.10.2021. However, BCCL proceeded to 8 open the Financial Bids of the remaining nine bidders who were technically qualified and proceeded to issue a Letter of Acceptance on 20.10.2021 in favour of the Respondent No. 4. Since the respondent BCCL had disregarded the opinion of IEMs, petitioner was left with no other option than to approach this court in the instant writ petition on 25.10.2021.
8. As has been observed by us in the order dated 07.09.2021, there was no reason why IEMs should have kept the inquiry in abeyance as per their opinion on 28.11.2011 conveyed to the CMD, BCCL in view of filing of the writ petition. However, their final opinion furnished pursuant to the order dated 07.09.2022, as noted above, has found the rejection of the bid of the petitioner on technical grounds as valid. We are thus required to examine, whether the rejection was proper in the eye of law and in consonance with the terms and conditions of the NIT and the Instruction to Bidders under Standard Bidding Document. If the rejection of his tender as technically disqualified was not proper, the consequent award of work to the Respondent No. 4 after opening the Financial Bid of rest of the qualified tenderers could be open to question. The petitioner or any other bidder did not have legal obligation to notarize the joint venture agreement at the time of submission of the bid. There is no requirement in law and under the Notaries Act to do so. Section 8 (1) (a) of Notaries Act, 1952, prescribing the function of the Notary, does not require the document to be notarized is to be executed in the presence of the Notary Public. Section 8 is extracted hereunder:
"8. Functions of notaries.- (1) A notary may do all or any of the following acts by virtue of his office, namely:-
(a) verify, authenticate, certify or attest the execution of any instrument;
(b) present any promissory note, hundi or bill of exchange for acceptance or payment or demand better security;
(c) note or protest the dishonour by non-acceptance or non-
payment of any promissory note, hundi or bill of exchange or protest for better security or prepare acts of honour under the Negotiable Instruments Act, 1881 (XXVI of 1881), or serve notice of such note or protest;
(d) note and draw up ship's protest, boat's protest or protest relating to demurrage and other commercial matters;
(e) administer oath to, or take affidavit from, any person;
(f) prepare bottomry and respondentia bonds, charter parties and other mercantile documents;
(g) prepare, attest or authenticate any instrument intended to take effect in any country or place outside India in such form and language as may conform to the law of the place where such deed is entitled to operate;
(h) translate, and verify the translation of, any document, from one language into another;
1 [(ha) act as a Commissioner to record evidence in any civil or criminal trial if so directed by any court or authority;] 9 1 [(hb) act as an arbitrator, mediator or conciliator, if so required;]
(i) any other act which may be prescribed.
(2) No act specified in sub-section (1) shall be deemed to be a notarial act except when it is done by a notary under his signature and official seal.
One of the functions of the Notary which applies to the present case, is to verify, authenticate, certify or attest the execution of any instrument. This doesn't imply that the execution of the instrument has to be done in the presence of the Notary Public itself on that particular day. In this regard, learned counsel for the petitioner has placed reliance upon a decision of Delhi High Court the case of M/s Madhucon Projects Ltd. Versus National Highways Authority of India & others - WPC number 8418/2010 dated 10.03.2011, Para-41 to 46].
9. As the undisputed facts emerge from the pleadings on record, the joint venture agreement was executed on 15.06.2021 between the parties. But since it was notarized on 18.06.2021 before submission of the bid, such a defect or mismatch in the dates was pointed out by the Technical Evaluation Committee and the petitioner was requested to submit the rectified copy of the mismatch of joint venture agreement by the concerned Notary Public. The Tender Evaluation Committee was not required to point out such a defect as the SBD and the Instruction to Bidders did not stipulate notarization of any joint venture agreement As observed here in above, in law also, there was no requirement that the date of execution of the agreement should be the same as the date on which the document is notarized. It was obvious to the naked eye that the joint venture agreement had been executed on 15.06.2021 and as such, the Letter of Undertaking, Declaration and affidavits such as Annexures-O, B, N and P, all were executed thereafter on 17.06.2021 before the cut-off date i.e. 18.06.2021 submission of the bid. An innocuous correction in the execution of the joint venture agreement from 15.06.2021 to 18.06.2021 at the top of the first page of the JV agreement, and that too on the request of the Respondent BCCL led to disqualification of the petitioner on technical grounds. It is idle to suggest that even if there was a mismatch in the date of the execution of the JV agreement and the date on which it was notarized, it was not a term falling within the mandatory conditions of the tender which vitiated the entire bid of the petitioner. Learned Division Bench of Delhi High Court in the case of M/s Madhucon Projects Ltd. (supra) in a more or less similar situation had the reason to observe in the following manner:
10"A typographical error of a date in the Power of Attorney when it is duly signed, accepted and notarized can at worst be a technical defect..................."
10. Petitioner has strongly contended before this court that its Financial Bid was 24.52% below the estimated value of Rs. 150.78 crores (approximately Rs. 9.00 crores lower than the bid quoted by the Respondent no. 4). If the Technical Evaluation Committee was so particular regarding the notarized JV agreement submitted by the petitioner, though there being no requirement of notarization of the JV agreement, it could have disqualified the petitioner on that score itself or it could have chosen to ignore it. As there was no requirement of notarization of the JV agreement, it could have made no difference on the joint venture agreement in the award of work. However, this Court is conscious that under process of judicial review, it should not step into the shoes of the Technical Evaluation Committee and second guess their opinion. But it is true that if the decision is such which falls within the scope of judicial review under the Wednesbury Principles of Reasonableness as laid down in the case of Tata Cellular versus Union of India [(1994) 6 SCC 651] and also relied upon in successive decisions by the Apex Court in the case of New Horizons Limited and Another Versus Union of India and others [(1995) 1 SCC 478, Para- 18 and 19], the same can be interfered with under Article 226 of the Constitution of India. One of the grounds laid down is irrationality. The Apex court in the case of Tata cellular (supra) has mentioned two other facets of irrationality as also quoted in the case of New Horizons Limited and Another :
"1. It is open to the court to review the decision maker's evaluation of the facts. The court will intervene where the facts taken as a whole could not logically warrant the conclusion of the decision maker. If the weight of facts pointing to one course of action is overwhelming, then a decision on the other way, cannot be upheld.
2. A decision would be regarded as unreasonable if it is partial and unequal in its operation as between different classes."
11. The sealed cover which has been submitted by the BCCL pursuant to the order dated 27.09.2022 and 13.10.2022 has been opened today. However, it does not contain the Financial Bid of the petitioner who was technically disqualified. The summary of the Financial Bids of the technically qualified bidders however, are available which shows that the bid quoted by the Respondent No. 4 @ Rs. 1,04,14,65,028.00 was 11 accepted as L-1 amongst nine other bidders. The reply to the e-mail dated 19.10.2022 of the General Manager (MM), BCCL by the NIC indicates that the bid submitted by the bidders will be signed and encrypted using public keys of the designated bid openers of the department at the bidder end and will be transmitted to the server. These encrypted bids can be decrypted only by the designated bid opener's private key of the Digital Signature Certificate. Without the bid openers DSC, neither NIC nor tender Inviting Authority can open the bids (technical / financial) received in the tender. Hence, Tender Inviting Authority should ensure availability of digital Signature Certificate of bid openers with which all bids have been encrypted. At the end of this reply, a request has been made that an official letter from Tender Inviting Authority to NIC should be sent for bringing the tender to the Financial Evaluation Stage as mentioned in para-4(a) which reads as under:
"4(a) As the tender that are concluded (issued Award of Contract) in the portal, tenders cannot be revoked & brought back by the Tender Inviting Authority. As per the direction of the Honorable High Court of Jharkhand, NIC as an Application Administration through Administrative corrigendum can revoke & bring back this tender one stage prior to Award of Contract that is Financial Evaluation Stage."
12. It however appears that such a request vide e-mail dated 19.10.2022 was sent by the General Manager (MM), CIL Headquarters to the NIC. NIC was requested to provide Financial Bid data of the petitioner M/s SM & SNR (JV), which remained unopened due to technical disqualification in relation to the reference tender in a sealed envelope to the BCCL so that the same can be submitted to the Hon'ble High Court for next hearing date i.e. 02.11.2022.
13. Therefore, it appears that the NIC has, despite such a request made by the BCCL pursuant to the orders passed by this Court, misunderstood the purport of the order and failed to furnish the Financial Bid of the petitioner in sealed cover as desired. As such, the only useful information which can be drawn out of the documents supplied by the NIC is the Financial Bid of the Respondent No. 4 of Rs. 1,04,14,65,028.00 against which the work was awarded to him as L-1. As such, the only other document or statement on record indicating the Financial Bid of the petitioner is the supplementary affidavit filed by the petitioner dated 11.10.2022. Petitioner has enclosed the relevant page of 12 the price bid as Annexure-7 which is to the effect that its Financial Bid is 24.52% less than the estimated value of Rs. 150.78 crore i.e. Rs. 96,45,37,181.76 crore (approximately Rs. 9.00 crore less than the price quoted by the Respondent No. 4 on which he has been granted the Letter of Acceptance / Work Order). As such, it is apparent that, had the bid of the petitioner been accepted as technically qualified in all respects, petitioner could have been the lowest bidder, meaning thereby that the Public Exchequer could have been saved approximately Rs. 9.00 crores in the award of the instant work.
14. On the part of the BCCL, learned Counsel Mr. Amit Sharma has taken this court to the terms and conditions of Instruction to Bidders under the SBD. Reference is made to sub-clause iii, iv and vii of clause 2 of the Instruction to Bidders under SBD, which prescribes the eligibility criteria and the format for joint venture agreement (Annexure-L). He has also drawn the attention of this court to sub clause 2.4 (at page 46), which provides that the bidders have to accept unconditionally the online user portal agreement; Clause 20.3 on Technical Evaluation of Tender; Clause 20.4 which provides that in case of change in joint venture agreement, all relevant documents have to be resubmitted in conformity with the NIT; clause 20.5 provides that the tender will be evaluated on the basis of documents uploaded by bidders. Learned counsel for the BCCL has also referred to clause 20 which relates to the right of the employer to accept negotiate or reject any or all the bids. It is submitted that the reasons of rejections are not malafide as the bidding process was undertaken through the NIC and the Financial Bids of none of the bidders were known to the BCCL. Learned counsel for the BCCL has also referred to the final report of the IEMs in the affidavit dated 22.09.2022, wherein they have not found any fault in the rejection of the bid of the petitioner on technical evaluation. Learned counsel for the BCCL has relied upon the decisions of the Apex Court in the case of Jagdish Mandal versus State of Orissa and others [(2007) 14 SCC 517 Para 22] in support of his submission that the process adopted by the employer cannot be said to be intended to favour Respondent No. 4 as it was not known to the employer as to which of the bidders had quoted the lowest price. Reliance is also placed in the case of Galaxy Transport Agencies, Contractors, Traders, Transports and Suppliers versus New J.K. Roadways, Fleet Owners and Transport 13 Contractors and Others [2020 SCC Online SC 1035 Para-14 and 15] where the Apex court has opined that the courts exercising powers of judicial review should not indulge in second guessing the requirements of the tender condition in place of the employer or the authority who is the best person to decide as to whether the concerned bidder fulfils the required terms and conditions of the NIT. Learned counsel for the respondent BCCL and respondent no. 4 both have submitted that the total value of work awarded to the Respondent No. 4 is approximately Rs. 104 crore. This matches with the L-1 rate found in the summary of Financial Bids as submitted by the NIC in the sealed cover.
15. Learned counsel for the Respondent No. 4 has also taken this court through the terms and conditions contained in clause 2.1. He has also drawn the attention of the court to the format of the letter of the affidavit, format of the joint venture agreement and pointed out that the JV agreement submitted by the petitioner did not contain the dates of execution on its last page i.e. page 159. It was therefore not in consonance with the Format of joint venture agreement. He has also referred to the Annexures-O filed by the petitioner which doesn't contain any date, except the notaries date i.e. is 17.06.2021. It is submitted that because of such infirmity in other documents also such as annexure-O, the Technical Evaluation Committee of BCCL requested the petitioner to correct the date mismatch in the joint venture agreement as notarized by the Notary Public. It is submitted that the Respondent No. 4 has competed with eight other bidders who were technically qualified and on account of being the lowest bidder, has been awarded the work. The Respondent No. 4 has harnessed machinery and equipment to execute the work of transportation and crushing of coal. The period for execution of the work is three years out of which one year is already over. Responded No. 4 has executed approximately 25% of the allotted work on the date it filed its affidavit and by now, about 33% of the work. Learned counsel for the Respondent No. 4 has relied upon the decision rendered in the case of N.G. Projects Limited and Vinod Kumar Jain and others [(2022) 6 SCC 127, para-10, 17, 22 and 23] which reiterates the principles on which the powers of judicial review should be exercised by the writ court.
16. Learned senior counsel for the petitioner has reiterated his submissions as have been captured in the order dated 07.09.2022, 14 reproduced in the foregoing paragraphs. It is submitted that the petitioner has not alleged malice on facts, but the facts and circumstances of the case borne out from the pleadings on record, do create an impression that the exercise of power is vitiated by malice in law. Malice in law means lack of bonafides in taking action. He has relied upon the case of Smt. S.R. Venkataraman versus Union of India and another [(1979) 2 SCC 491, para-5 and 6] in support of the aforesaid submission. Reliance has also been placed in the case of Jai Bholenath Construction versus The Chief Executive Officer, Zilla Parishad, Nanded & Ors - Civil Appeal No. 4140/2022], where the Apex Court has clarified its earlier judgment rendered in the case of N.G. Projects (Supra). It is submitted that since there was no mismatch in the dates in the JV agreement submitted by the petitioner, there was no obligation on the part of the petitioner to rectify the alleged mismatch in dates. Learned counsel for the petitioner has also relied upon the provisions of Section 8 (1) (a) of the Notaries Act, which do not require that the execution of the JV agreement should be done on the date on which it is notarized. The notary has to only authenticate or attest the JV agreement, which was executed by the joint venture partners on 15.06.2021. Since such correction was made at the instance of the BCCL, it doesn't lie in the mouth of the respondents BCCL to debar the petitioner on technical grounds after such correction was made. It is submitted that the larger public interest has suffered on account of disqualification of the bid of the petitioner since his bid happens to be the lowest amongst all the technically qualified bidders. As such, Respondent BCCL may be directed to entertain Financial Bid of the petitioner. Disqualification of the petitioner's bid on technical grounds be set aside. Petitioner has duly submitted Rs. 2.5 Crore with the Registry of this Court as directed vide order dated 07.09.2022 to show his earnestness in executing the remaining part of the work.
17. We have considered the submission of learned counsel for the parties. The narration of facts and events recorded earlier need not be repeated again. On a careful and composite reading of the relevant terms and conditions of the Instruction to Bidders and the SBD under the NIT in question, it is but obvious that there was no requirement for a joint venture bidder to submit JV agreement in notarized form. However, submission of JV agreement in notarized form has also not been treated 15 as ineligible under the ITB. It is not a requirement of law either that such a document has to be executed on the same day in the presence of the Notary. The defect of mismatch in dates pointed out by the employer BCCL was therefore neither a contravention in terms of the ITB to SBD, nor was a requirement in law to be pointed out. It is obvious on the face of the joint venture agreement that it had been executed on 15.06.2021 and as such, other documents such as Annexure-N and O executed by the joint venture partners as notarized on 17.06.2021 were valid on the date on which the joint venture agreement was submitted i.e. the cut-off date 18.06.2021. It was only on the request of the Employer that the correction in the date at the top of the first page of JV agreement was made by the petitioner from 15.06.2021 to 18.06.2021. The employer then cannot be allowed to say that the bid of the petitioner becomes technically disqualified as other documents such as Annexure- N, P etc. were of prior date. Since all these tender processes were being done online, petitioner could not be expected to physically convince the Tender Evaluation Committee that there was no mismatch in the execution of the JV agreement and the date on which it was notarized. The petitioner did not have an option to refuse to make the correction pointed out by the Technical Evaluation Committee, which ultimately resulted in its bid being declared non responsive. The decision of the Tender Evaluation Committee of the Employer BCCL therefore, can be said to be irrational as evaluation of the bid of the petitioner as per the terms and conditions of the ITB to SBD taken as a whole, did not logically warrant the conclusion taken by the Tender Evaluation Committee. This being a facet of irrationality as propounded in the case of Tata cellular (Supra) being one of the grounds under the Wednesbury Principles of Reasonableness in the field of award of contract by Government Bodies, we are persuaded to interfere in the matter under Article 226 of the Constitution of India. Taking into consideration the larger object of public interest in the award of such works also, such a decision cannot be sustained in the eye of law as it has led to arbitrary results. The Respondent BCCL has awarded the work to a person whose Financial Bid appears to be approximately Rs. 9.00 crore higher than that of the petitioner.
18. However, having observed here in above, we are unable to find fault with the Respondent No. 4 in the award of work in his favour. No 16 infirmity in the evaluation of his tender document and award of work in his favour as L-1 can be found once the Respondent BCCL had disqualified the bid of the petitioner on technical grounds. However, the stipulated period of the work is 1278 days i.e. more than three years, only one year has elapsed since the award of work in favour of Respondent No. 4. This court is therefore required to mould the relief in the following manner to suit the interests of justice. i. Since the technical disqualification of the petitioner's bid cannot be upheld in the eye of law, the Respondent BCCL shall treat the Technical Bid of the petitioner as duly qualified for opening of its Financial Bid.
ii. Since the Respondent No. 4 has harnessed its resources, plants and machinery for the execution of the work allotted to it under the Letter of Acceptance / Work Order and some part of the work may be in execution at this stage, the Respondent BCCL should direct the Respondent no. 4 to complete it within a period of two months.
iii. Upon evaluation of the Financial Bid of the petitioner vis-a-vis the Respondent No. 4, Employer BCCL shall take a decision on the award of the remaining unexecuted work in favour of the petitioner with suitable terms and conditions and upon furnishing of Performance Guarantee etc., as required.
iv. Petitioner has shown his earnestness in execution of the work by complying with the terms imposed by this court and depositing Rs. 2.5 Crore through demand draft with the Registry of this court. Petitioner undertakes to comply with all such conditions including submission of Performance Guarantee to the Employer BCCL on award of the remaining part of the work in question i.e. lifting and long term transportation including crushing of coal from different sources at Bastacolla area, BCCL to the BNR Siding of BCCL including allied jobs.
v. The amount of Rs. 2.5 Crore deposited by the petitioner shall be released in his favour upon such decision by the BCCL and submission of any Performance Guarantee etc. within the aforesaid period of two months. Learned Registrar General shall release the demand draft of Rs.2.5 crore with interest as accrued thereupon after seeking permission from the Bench.
1719. As a result of the discussions made hereinabove and for the reasons recorded, the writ petition is allowed in the manner and to the extent indicated hereinabove.
(Aparesh Kumar Singh, J) (Deepak Roshan, J) Ranjeet/