Allahabad High Court
M/S Rhetoric Technologies Pvt. Ltd ... vs State Of U.P. ... on 30 January, 2023
Bench: Sangeeta Chandra, Manish Kumar
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH A.F.R. Court No. - 2 Case :- WRIT - C No. - 6210 of 2022 Petitioner :- M/S Rhetoric Technologies Pvt. Ltd Thru. Authorised Representative And Another Respondent :- State Of U.P. Thru.Prin.Secy.Transport Sectt. And 6 Others Counsel for Petitioner :- Aakash Prasad,Amitav Singh Counsel for Respondent :- C.S.C.,Ajai Kumar,Ayush Chaudhary,Rakesh Kumar Chaudhary,Vivek Kumar Rai along with Case :- WRIT - C No. - 6534 of 2022 Petitioner :- M/S Rosmerta Technologies Ltd. Lucknow Thru. Its Authorized Signatory Sri Shesh Nath Pandey Respondent :- State Of U.P. Thru. Prin. Secy. Transport Secrt. , Lucknow And Others Counsel for Petitioner :- Rakesh Kumar Chaudhary,Ayush Chaudhary Counsel for Respondent :- C.S.C.,Aakash Prasad,Ajai Kumar,Vivek Kumar Rai Hon'ble Mrs. Sangeeta Chandra,J.
Hon'ble Manish Kumar,J.
(Oral)
1. Writ-C No. 6210 of 2022 (M/S M/S Rhetoric Technologies Pvt. Ltd Thru. Authorised Representative And Another vs. State Of U.P. Thru.Prin.Secy.Transport Sectt. And 6 Others is taken along with Writ- C No. 6534 of 2022 (M/S Rosmerta Technologies Ltd. Lucknow Thru. Its Authorized Signatory vs. State Of U.P. Thru. Prin. Secy. Transport Secrt.) as both the writ petitions challenge the same decision taken by the State Government on almost same grounds.
2. The challenge in the writ petitions is to the minutes of the meeting dated 23.06.2022 and also to the publication of results dated 27.07.2022/28.07.2022 to the extent that it qualifies and includes the name of the Consortium of respondent nos. 5, 6 & 7. A further prayer has been made for a direction to the respondent nos. 1 to 4 to proceed with the tender in terms of the recommendations of the Bid Evaluation Committee which was constituted by the Transport Commissioner, copy of whose recommendations were sent by the Transport Commissioner to the State Government for approval.
3. When the Writ- C No. 6210 of 2022 was filed, this Court was pleased to pass a detailed interim order on 12.09.2022 which is being quoted hereinbelow:-
"Sri Vivek Kumar Rai, Advocate has put in appearance on behalf of respondent Nos. 5, 6 and 7.
The instant matter pertains to award of tender for work related to Inspection and Certification (I&C) of the commercial vehicles for the purpose of certification of their road worthiness.
Learned Senior Advocate, Sri Jaideep Narain Mathur, assisted by Sri Aakash Prasad, Shantanoo Saxena and Sri Amitav Singh, learned counsel representing the petitioners has submitted that the respondent No.5, who is the lead member of consortion selected as the lowest bidder, had not submitted RFB with the bid documents though "bid documents", as defined in Clause 1(iii) of the definition clause of the General Conditions of Contract, means certain documents to be prepared by the bidder under the contract "in addition to the RFB". He has further drawn our attention to the minutes of the Technical Bid Evaluation Committee which after evaluation of the technical bid of participating the bidders had clearly found respondent No.5 not to be technically qualified whereas the said Committee has found the petitioners to be qualified. It is also the argument of the Sri Mathur that as per the terms and conditions any recommendation made by the Technical Committee ought to have been considered by the Commissioner, Transport, U.P. and not by the State Government. He has also drawn our attention to the minutes of the meeting held under the Chairmanship of the Principal Secretary, Transport, a perusal of which reveals that after the recommendation of the Technical Bid Evaluation Committee regarding technical bid of all the participants which was held on 03.06.2022, some representation dated 05.06.2022 was made by the respondent No.5 and it is in the light of the said representation that the matter was considered again by a Committee headed by the Principal Secretary, Transport Department. It has further been argued by Sri Mathur that the recommendation made by the Technical Bid Evaluation Committee, vide its decision taken in the meeting held on 03.06.2022 was yet to be considered by the Transport Commissioner and the said recommendation was never published and thus, it is intriguing as to how this information was leaked to the petitioners which allowed him to make representation dated 05.06.2022. According to the petitioners, the entire bidding process was to be kept confidential and in the instant case the confidentiality has, thus, been breached.
Let instructions on the aforesaid as also on all the issues involved in the writ petition be obtained by the learned State Counsel by tomorrow i.e. 13.09.2022.
List/put up this case tomorrow i.e. 13.09.2022.
We have been informed that pursuant to the completion of the bid process, Letter of Award (LoA) has not yet been received by the respondent No.5. The respondents are accordingly advised not to issue the same or to act upon the same till tomorrow i.e. 13.09.2022."
Thereafter, the matter was taken up on past few occasions but could not be heard on merits and the stay vacation applications filed by the respondents remained pending while interim order was extended from time to time. The State respondents have prayed that the matter to be heard and disposed of expeditiously and it has been heard for the past three days by us.
4. The case as set up by the petitioners is that the Transport Department, Government of U.P. issued a Request for Bid (hereinafter referred to as 'the R.F.B.') for the operation of Inspection and Certification Centre (hereinafter referred to as 'the I & C') in respect of vehicles, at Lucknow, Uttar Pradesh for a period of five years. The R.F.B. prescribes the mode, manner and method of bid submission and the necessary qualifications required for such bidders. The bidding process was to be a two stage process. At the first stage, a technical evaluation had to be done of all the bidders. Those bidders who were found technically qualified were to be considered for their financial bids. The R.F.B. disabled any improvement, correction or alteration of documents once submitted. All documents had to be on notorized affidavits, there was no power of review given to the Procuring Authority.
5. It has been submitted by learned Senior Advocate, Sri J.N. Mathur assisted by Sri Amitav Singh and Sri Shantanu Saxena, for the petitioner - M/S Rhetoric Technologies Pvt. Ltd that a pre-bid meeting was held on 17.01.2022 which resulted in 49 suggestions being made and clarifications were issued thereafter by the Department. The date of submission of bid was extended after issuance of such corrigendum/addendum. On the last day of submission of bids determined to be 19.04.2022, only six bids were received including that of the Consortium of the petitioner and the Consortium of respondent nos. 5, 6 & 7. A six member Technical Committee was constituted by the Transport Commissioner to evaluate the bids, at the technical stage. The Technical Evaluation Committee met on three dates and the combined minutes of the meeting of the Technical Evaluation Committee were published on 01.06.2022 where the Committee found only three bidders to be qualified including the petitioner- M/S Rhetoric Technologies Pvt. Ltd. It disqualified three bidders including Consortium led by respondent no. 5. On 05.06.2022, the Consortium led by respondent no. 5 sent a representation through e-mail to the Principal Secretary/Additional Chief Secretary, Govt. of U.P. explaining its deficiency and asking for a review of the decision of the Technical Evaluation Committee constituted by the Transport Commissioner.
6. It has been argued by the learned counsel for the petitioner that strict confidentiality had to be maintained by all the bidders not only at the time of submission of their Technical and Financial bids but also all throughout the process of evaluation of the bids and therefore it is incomprehensible as to how the respondent nos. 5 to 7 came to know the reason for rejection of their Technical bids and sent an e-mail to the respondent no. 1. The Principal Secretary, Transport on 23.06.2022 called a meeting of a fresh Technical Evaluation Committee constituted by him, containing two members of the earlier Technical Evaluation Committee and the fresh Committee considered the representation of the Consortium led by respondent no. 5. It has been argued that the Committee so constituted was completely illegal and the process adopted by it was arbitrary as there was no power vested with the State Government to interfere in the tender process at any stage. In excess of the jurisdiction vested in him, the respondent no. 1 constituted the Committee for re-evaluation of Technical bids and against the clear provisions of the R.F.B., it declared the Consortium led by respondent no. 5 as successful along with another bidder who had earlier been declared unsuccessful by the Technical Evaluation Committee constituted by the Transport Commissioner. The results of the technical evaluation of the Committee consituted by the respondent no. 1 was declared on 27.07.2022 and on the same date, the financial bids were opened and the Consortium of respondent no. 5 was declared as L1 even though, it had quoted an abnormally low price for running the I & C.
7. It is the case of the writ petitioner- M/S Rhetoric Technologies Pvt. Ltd. that after the enquiries were made, it came to know of colourable exercise of power by the respondent no. 1 causing undue favour in respect of respondent nos. 5 to 7. The petitioner wrote a letter to the Chief Minister complaining of such illegalities but no heed was paid and therefore the petitioner approached this Court in this writ petition.
8. It has been submitted by the learned counsel for the petitioner that on the basis of R.F.B., issued by the respondent, copy of which has been filed as Annexure no. 2 to the writ petition, that under Section 2 i.e. Instructions to bidders, clause 2 (f) clearly provided that the bid document had to be stamped and signed by the person duly authorized by the Company through its Board resolution. Any bid not complying with the terms and conditions as set out in the R.F.B. and/or not signed by the authorized person shall be rejected.
9. Learned counsel for the petitioner states that bid documents have not been defined but "Bidders Documents" has been defined. He has referred to General Conditions of Contract contained in Section 12 where in the definitions clause, sub-clause-iii, the "Bidders Document" has been described as meaning, in addition to R.F.B., those documents to be prepared by the bidder under the contract including without limitation, such technical documents specified in the technical conditions of the contract and such data, drawings, designs, information, calculation etc. and all other information and documents including legible data relating to execution of works or otherwise relating to the performance of the Contract.
10. Learned counsel for the petitioner has submitted that since the "Bidders Documents" as defined under Section 12(1)(iii) refers to the R.F.B. to be filed along with other technical documents specified in the technical conditions of the Contract, such R.F.B. was to be stamped and signed and submitted along with the Technical bid and a correct interpretation of such condition was made by the Technical Evaluation Committee of the Transport Commissioner when it disqualified the Consortium led by the respondent no. 5 on the ground that the R.F.B. document was neither signed nor stamped nor submitted along with the Technical documents/Technical bid of the contesting respondents.
11. Learned counsel for the petitioner has also argued that the State Government was not competent to review the minutes of the meeting of the Technical Evaluation Committee constituted by the Transport Commissioner as the 'Competent Authority' has been defined under Section 12 as the Transport Commissioner. It has been submitted that the contract had to be entered between the successful bidder and the Transport Commissioner and the execution of the agreement between successful bidder and the Transport department was to be through the Transport Commissioner as is mentioned in Section 1 i.e. the Introduction to the R.F.B., where the Transport Commissioner has been defined as the 'Procuring Authority' who shall invite the e-tenders for execution from bidders in the prescribed proforma, who shall thereafter constitute a Technical Evaluation Committee on terms and conditions as contained in the R.F.B.
12. Learned counsel for the petitioner has also referred to Clause 23 of the tender document where the representation and warranties of the bidders have been given which relate to the undertaking given by the bidder to the Transport Department, Govt. of U.P. and has argued that since all the undertakings were to be given in terms and on the conditions as mentioned in the R.F.B., the R.F.B. document itself had to be signed, stamped and submitted by the bidder. He has referred to various conditions regarding payment schedule etc. and also statutory liabilities mentioned in the R.F.B. to argue that unless the bidder signed the R.F.B. and submitted it along with the Technical bid, it could not be taken by the Procuring Authority that he agrees with all the conditions mentioned in the R.F.B. and was ready to be bound by them in case of dispute.
13. Learned counsel for the petitioner has placed reliance upon judgement rendered by the Supreme Court in Kanhaiyalal Agarwal Vs. Union of India and others AIR 2002 Supreme Court 2766 (paragraph 6), wherein the Supreme Court has observed that when an essential condition of tender is not complied with, it is open to the person inviting tender to reject the same. Whether a condition is essential or collateral could be ascertained by reference to consequence of non-compliance thereto. If non-fulfilment of the requirement results in rejection of the tender, then it would be essential part of the tender, otherwise it is only a collateral term while placing reliance upon judgement rendered by it in G. J. Fernandez Vs. State of Karnataka and others 1990 (1) SCR 229.
14. It has also been argued by learned counsel appearing for the writ petitioner in Writ-C No. 6534 of 2022 that M/S Rosmerta Technologies Ltd. Lucknow has challenged the technical evaluation not only of the petitioner- M/S Rhetoric Technologies Pvt. Ltd but also the respondent nos. 5 to 7, the Consortium led by Hari Filling Centre on merits. Shri Rakesh Kumar Chaudhary, learned counsel appearing for the petitioner in Rosmerta Technologies Limited has pointed out that both the petitioner and respondent nos. 5 lack the technical qualification and the experience that was required to run the I & C and Rosmerta Technologies Limited having already qualified and being found competent to run the I & C on earlier occasion, had necessary experience and competence to do so. He has referred to the abnormally low price quoted by the Consortium led by respondent no. 5 in the financial bid to say that even the Procuring Authority, the Transport Commissioner had expressed a doubt regarding the capability of the respondent no. 5 to stick to its undertaking regarding the low price for running the I & C. He has on the question of competence of the State Government and also on the question of submission of R.F.B. alongwith Technical bid documents adopted the arguments made by Shri J.N. Mathur, learned Senior Advocate on behalf of the Rhetoric Technologies Ltd.
15. Shri Rakesh Chaudhary has placed reliance upon two judgements of the Supreme Court, which are namely:-
i) West Bengal State Electricity Board Vs. Patel Engineering Company Ltd and Others, 2001 Vol. 2 SCC page 451 (Paragraphs 24, 25, 27, 28, 31, 33, 34)
ii) Municipal Corporation Ujjain and Another V. B.V.G. India Ltd and others 2018 Vol. 5 SCC 462 (paragraphs 42,43) In West Bengal State Electricity Board (supra), the Supreme Court observed that negligent mistakes in bid documents cannot be permitted to be corrected on the basis of equity where the facts indicated that it was not beyond the control of the bidder to correct the error before submission of the bid; and that he was not vigilant, and that he did not seek to make corrections at the earliest opportunity. Strict adherence to instructions to bidders is essential and cannot be branded as a pedantic approach. The scope of judicial review in Government tenders is limited but it cannot mean permitting the bidder to correct the errors in the bid documents which were not merely clerical or mechanical, when such corrections were not permissible under the Rules governing the process of tender. Also, it was observed that there is no obligation to award the contract to the lowest bidder and it is always open to the Government or its agency to negotiate with the next lowest bidder and to try to reach an economically viable and mutually acceptable price.
In Municipal Corporation Ujjain (supra), the Supreme Court had observed that the High Court should not ordinarily interfere with the judgement of expert consultants on the issue of technical qualifications of a bidder when the consultant had taken into consideration various factors including basis of non-performance of the bidder. It is not open to the Court to independently evaluate technical bids and financial bids of the parties as an Appellate Authority for coming to its own conclusion in as much as unless thresholds of malafide intention to favour someone or bias, arbitrariness, irrationality or perversity are met. The Court observed that if the decision is taken purely in public interest, the Courts ordinarily should exercise judicial restraint.
16. Learned counsel appearing for the State-respondents, Shri Rajesh Tiwari, learned Additional Chief Standing Counsel assisted by Shri Nishant Shukla, learned Standing Counsel have argued that both the submissions made by the learned counsel for the petitioner in Rhetoric Technologies regarding the 'Competent Authority' and the technical disqualification regarding requirement of submitting the R.F.B. are untenable on the ground that R.F.B. is only an Invitation to Offer. He has referred to the power of the State Government which has been reserved in the tender document given in Clause 13 and 15 of Section 2 i.e. the Instructions to Bidders. He has referred to Clause 13 (d) and (e) where the Transport Department, Government of U.P. could call for clarification from bidders and the Transport Department, Government of U.P. reserved the right to finalize the technical evaluation by seeking such clarifications and conducting an evaluation before the time of opening of the financial bid. He has also referred to Clause 15 of Section 2 where the Transport Department, Government of U.P. had reserved the right to accept or reject any bid and to annul the tender process and reject all bids, at any time prior to the award of the contract, without assigning any reasons for such acceptance/rejection, without incurring any liability to the affected bidder/bidders or any obligations to inform the affected bidder/bidders of the grounds for the Transport Department, Government of U.P.'s action. Such residual and supervisory right once exercised by the Government of U.P. would not give any cause of action to any of the bidders to claim any compensation for rejection of their bids by the Transport Department, Government of U.P.
17. The learned Counsel appearing for the State respondents has also referred to the definition of Competent Authority as given under the General Conditions of the Contract Section 12, where Competent Authority has been defined as the Transport Department, Government of U.P. and not the Transport Commissioner.
18. Learned Standing Counsel has also referred to definition of R.F.B. as given under Section 12 (1) (XXIX) where R.F.B. has been defined to mean request for bid issued by the Transport Department, Government of U.P. through e-Tender for operation of vehicle, inspection and Certification Centre at Lucknow, and includes the bid document alongwith its annexures, enclosures, schedules, Sections, Forms, Addendum/Corrigendum and clarification etc issued from time to time during the bid process.
19. Learned counsel for the State-respondents has pointed out that it is not the bid document that would include the R.F.B. but it is the other way round i.e. the R.F.B. would include the bid document, and only the bid document had to be submitted by the bidders at the time of technical evaluation and this fact was clarified in the meeting of the Committee that was constituted by the Competent Authority i.e. the State Government, whose minutes have been challenged before this Court.
20. The learned counsel for the State-respondents has led this Court through the Sections which are relevant relating to submission of technical documents. He has referred to Clause 8 (f) which refers to the documents that have to be submitted alongwith Technical bid of bidder. The Table 2 contained under Clause 8 (f) does not call for the R.F.B. to be submitted alongwith the Technical bid.
21. It has been argued by the learned counsel for the State respondent that had it not been required under the tender document to submit the Evaluation Committee's report to the respondent no. 1, for its approval, the Transport Commissioner would not have submitted the recommendations of the Technical Evaluation Committee for the approval of the State Government at all. The result published on 01.06.2022 was only a recommendation of the Technical Evaluation Committee and not a decision taken by the Technical Evaluation Committee and therefore, it was submitted to the Competent Authority for its approval.
22. Replying to the arguments made by Shri Rakesh Kumar Chaudhary, learned counsel for the petitioner-Rosemerta Technologies Ltd. regarding the incompetence of Rhetoric Technologies or respondent no. 5 to 7 in terms of experience, it has been argued that the recommendations of the Technical Evaluation Committee constituted by the Transport Commissioner have not been challenged by the petitioner-Rosmerta Technologies Ltd. and therefore, taking of any other ground to challenge the competence of respondent nos. 5 to 7 to run the I & C, would mean unraveling the entire tender process without the challenge being made to it in the first place.
23. The learned Standing Counsel appearing on behalf of the State Respondents has placed reliance upon judgement rendered by the Supreme Court in N.G. Projects Ltd versus Vinod Kumar Jain and others 2022 (6) SCC 127; and paragraphs 13, 14, 15 and 23 thereof. The Supreme Court observed that the owner or the employer of a project, having authored the tender documents, is the best person to understand and appreciate its requirements and interpret its documents. With regard to the interpretation of terms of the contract and the question as to whether a term of the contract is essential or not is to be viewed from the perspective of the employer and by the employer. The Courts should not use a magnifying glass while scanning the tenders and make every small mistake appear like a big blunder. In fact, the Courts must give "fair play in the joints" to the Government and Public Sector Undertakings in matters of contract. The Courts must also not interfere where such interference would cause unnecessary loss to the public exchequer and while entertaining the writ petition and/or granting the stay which may ultimately delay the execution of public projects, it must be remembered that it might seriously impede the execution of the projects and disable the State and or its agencies/instrumentalities from discharging their Constitutional and legal obligation towards the citizens. It was observed by the Supreme Court that the High Court should be extremely careful and circumspect in exercise of the discretion while entertaining such petitions and/or while granting stay in such matters. The Writ Court should refrain itself from imposing its decision over the decision of the employer as to whether or not to accept the bid of a tender. The Court does not have the expertise to examine the terms and conditions of the present economic activities of the State and this limitation should be kept in view. The Courts should be even more reluctant in interfering with the contracts involving technical issues as there is a requirement of the necessary expertise to adjudicate upon such issues. The Court should only examine as to whether the decision making process is after complying with the procedure contemplated by the tender conditions. If the Court finds that there is a total arbitrariness or that the tender has been granted in a malafide manner, the Court should relegate the parties to seek damages for the wrongful exclusion rather than to injunct the execution of the contract. The injunction or interference in the tender leads to additional cost on the State and is also against public interest. Any contract of public service should not be interfered with lightly and in any case, there should not be any interim order derailing the entire process of the services meant for the larger public good.
24. Shri Prashant Chandra, learned Senior Advocate assisted by Ms. Radhika Singh, learned Advocate for the respondent nos. 5 to 7 has placed before this Court the Tender document and the requirement therein of a pre-bid Bid Meeting to be held between the prospective bidders and the Officials of the Transport Department. It was in the pre-bid Meeting that clarification was sought by the respondent nos. 5 to 7 whether R.F.B. was to be submitted alongwith the Technical bid and it had come out during the deliberations that only Bid documents had to be submitted duly signed and stamped by the authorized representative of the bidder, and not the R.F.B, and therefore once the Technical Evaluation Committee constituted by the Transport Commissioner made a recommendation against the respondent nos. 5 to 7, the respondent nos. 5 to 7 made a calculated guess that because the R.F.B. had not been submitted perhaps they had been disqualified on this ground alone. He has referred to paragraph 11 of the counter affidavit filed on behalf of the respondent nos. 5 to 7 in the writ petition No. 6210 of 2022 to which no reply has been given by the petitioners- Rhetoric Technologies Pvt. Ltd. He has referred to Clause 7 (b) of the Tender documents and also Clause 8 (f) of Section 2, which is Instructions to bidders. Clause 7 (b) refers to Technical bid submission and it says that the documents shall be filled as per the formats provided in the R.F.B. with required supporting documents. Technical Bid should be duly signed by the authorized signatory and scanned and uploaded on the E-Tender portal. The only requirement for Technical bid submission as given in Clause 7 (b) was for the bidder to fill in all information in the formats provided in the R.F.B. There was no requirement to submit a signed and stamped copy of the R.F.B also alongwith the Technical bids.
25. Shri Prashant Chandra, learned Senior Advocate has also reiterated the arguments regarding Clause 8 (f) which have been advanced by the learned Standing Counsel appearing for the State respondents, where the documents that had to be filed alongwith the Technical bid have been mentioned in the Form of a Table namely, Table 2, which only requires notorized copies of the original certificates and notorized undertakings to be given by the bidder and notorized affidavits etc., including the letter of undertaking as given in the Format/Form (B) duly signed by the authorized signatory of the bidder concerned. It has been argued that there is no requirement in Table 2 of submission of R.F.B. Twelve documents have been mentioned therein and all such twelve requirements were fulfilled by the respondent nos. 5 to 7.
26. With regard to the competence of the State Government, learned Senior Advocate has adopted the arguments made by the learned Standing Counsel on behalf of the State respondents and has referred to Clause 9 (c) which makes it amply clear that it is the Transport Department, Government of U.P. which had the right reserved to it without limitation, and without incurring any obligation or liability vis-a-vis any bidder, to independently verify and disqualify, reject/accept any or all of the bids.
27. It has also been argued by learned Senior Counsel appearing for the respondent nos. 5 to 7 that the arguments regarding abnormally low priced Financial bid submitted by it has been appropriately answered in the reply submitted by them on 08.08.2022 to the Transport Commissioner as is evident from the recommendation of the Transport Commissioner made in favour of the successful bidder i.e. respondent nos. 5 to 7. It has been argued that in the letter dated 08.08.2022, the respondent nos. 5 to 7 have clarified that they have sufficient experience in various States for running I & C and they wish to enter the State of U.P. also. They have, therefore, quoted a price which is attractive and possibly the lowest, and they have sufficient financial capability to run the I & C as per the requirements of the Transport Department. The respondent nos. 5 to 7 had also clarified that since they were running I & C in various States, they had the technical knowhow and qualification. Moreover, they were also aware of the risk of being blacklisted in one State i.e. the State of U.P. in case they could not fulfill their undertaking to run the I & C successfully for the period as required under the R.F.B and that they would not abandon the running of the Contract mid way and thus, mar their prospects in other States as well. The respondent nos. 5 to 7 had given the Performance Bank Guarantee for running the I & C, and were also aware that such Performance Bank Guarantee may be forfeited in case of failure to run the I & C as per the conditions given under the R.F.B. It is only on the basis of representation/clarifications given by the respondent nos. 5 to 7 through their letter dated 08.08.2022 that the Transport Commissioner by his letter dated 16.08.2022 had recommended giving of the contract to the Consortium of respondent nos. 5 to 7, it being also the lowest bidder/L-1 as found in the Financial bid.
28. The learned Senior Counsel appearing on behalf of the respondent nos. 5 to 7 has placed reliance upon two judgements of the Supreme Court namely: -
i) Poddar Steel Corporation versus Ganesh Engineering Works and others 1991 (3) SCC 273 (paragraph 6);
ii) Agmatel India Private Limited versus Resoursys Telecom and others 2022 (5) SCC 362 (Paragraphs 2, 24, 25, 28, 30) In Poddar Steel Corporation (supra), the Supreme Court had observed that it cannot be held as a matter of general proposition that an Authority inviting tenders is bound to give effect to every term mentioned in the notice in meticulous detail, and he is not entitled to waive even a technical irregularity of little or no significance. The requirements in the tender notice can be classified into two categories - those which lay down the essential conditions of eligibility, and the others which are merely ancillary or subsidiary with the main object to be achieved by the condition. In the first case, the Authority issuing the tender may be required to enforce them rigidly. In the other cases, it must be open to the Authority to deviate from and not to insist upon the strict literal compliance of the conditions in appropriate cases.
In Agmatel (Supra) the Supreme Court was considering the issue as to whether the High Court was justified in interfering with the view taken by the tender inviting authority. The Supreme Court made observations in paragraphs cited before us to the effect that the scope of judicial review in contractual matters, and particularly in relation to the process of interpretation of tender document, has been considered in various earlier judgements of the Court and it referred to the three Judges Bench decision of the Supreme Court in Galaxy Transport Agencies Vs. New J.K. Roadways, Fleet Owners and Transport Contractors (2021) 16 SCC 808; and the decision in Afcons Infrastructure Ltd versus Nagpur Metro Rail Corporation Limited (2016) 16 SCC 818; to say that interference by the High Court in interpretation given by the tender inviting authority of the eligibility terms relating to the requirements to be fulfilled by the bidders should not be lightly interfered with. Supreme Court observed that in a series of judgements it had held that the authority that authors the tender document is the best person to understand and appreciate its requirements and thus its interpretation should not be second guessed by a Court in judicial review proceedings. The Constitutional Courts must defer to the understanding and appreciation of the tender documents by the owner of the project unless there is malafide or perversity in the understanding or appreciation or in the application of the terms of the tender conditions. It is possible that the owner or the employer of a tender may give an interpretation to the tender documents that is not acceptable to the Constitutional Courts but that by itself is not a reason for interfering with the interpretation given.
29. The Supreme Court also referred to the judgement in Silppi Constructions Contractors Vs. Union of India (2020) 16 SCC 489; and observations made in paragraph 20 thereof to the effect that the authority which floats the contract or tender and has authored the tender documents is the best judge as to how the documents have to be interpreted. If two interpretations are possible then the interpretation of the author must be accepted. The Courts will only interfere to prevent arbitrariness, rationality, bias, Malafides or perversity. The Court further observed that evaluating tenders and awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to Award of Contract is bonafide and is in public interest, Courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. The tenderer or contractor with a grievance can always seek damages in a Civil Court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review should be resisted. Such interference either interim or final may hold up public works for years, or the relief and succour to thousands and millions and may increase the project cost manifold. Therefore, a Court before interfering in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions:
(i) whether the process adopted or decision made by the authorities is malafide and intended to favour someone;
Or Whether the process adopted or decision made is so arbitrary and irrational that the court can say "the decision is such that no responsible authority acting reasonably and in accordance with the relevant law could have reached";
(ii) whether public interest is affected.
If the answers are in the negative, there should be no interference under Article 226. ..,"
30. This Court has been led through various judgments of Hon'ble Supreme Court by learned counsel appearing for all the parties mention of which has been made only for the purpose of record as this Court is not satisfied on the factual aspect of the matter as argued by the petitioners of Writ-C No. 6210 of 2022 & Writ-C No. 6534 of 2022.
31. This Court on due consideration of the arguments raised by learned counsel for the parties finds also from perusal of the Tender documents that the Instructions to bidders (Section 2) clearly states that only bid documents had to be stamped and signed by duly authorized representative of the Company/bidder and the bid documents did not include the R.F.B. but the R.F.B. included the bid document. Moreover the Transport Department, Government of U.P. is the Competent Authority as defined under the Tender document and the Transport Department, Government of U.P. had reserved the right to independently verify, disqualify/reject or accept any or all of the bids. The Transport Commissioner may have been the Procuring Authority, but the contract had to be entered into by the Transport Commissioner in the name of the Government of U.P. It was only an Agent of the Government of U.P. and when the Principal decides to act in a particular manner on the basis of Tender documents as interpreted by it, it cannot be said that it exceeded its jurisdiction by constituting a Committee for review of decision taken by the Transport Commissioner.
32. This Court has also gone through the submissions made by the respondent nos. 5 to 7 in their counter affidavit regarding the Pre Bid Meeting that was held amongst the bidders and the State respondents and the specific contentions raised by learned counsel for the respondent nos. 5 to 7 that it had been clarified therein that the R.F.B was not to be submitted along with the bid documents which has not been controverted by either of petitioners i.e. the M/S Rhetoric Technologies Pvt. Ltd and the M/S Rosmerta Technologies Ltd. Lucknow and has to be taken as closure of the issue regarding confidentiality being raised by the petitioners herein.
33. This Court finds that both the arguments raised by the petitioners M/S Rhetoric Technologies Pvt. Ltd being found untenable by this court, its Writ C No. 6210 of 2022 deserves to be dismissed.
34. Since, M/S Rosmerta Technologies Ltd. Lucknow has adopted the arguments of learned counsel for the M/S Rhetoric Technologies Pvt. Ltd with regard to the competence of the State Government to interfere in the matter of evaluation of Technical bids and with regard to the requirement of the R.F.B. to be submitted alongwith the Technical bid documents. Both such arguments having been found untenable, the challenge of M/S Rosmerta Technologies Ltd. Lucknow to the decision taken by the Government on these grounds, also deserves to be rejected.
35. Since, M/S Rosmerta Technologies Ltd. Lucknow has not challenged the recommendation of Technical Evaluation Committee dated 01.06.2022 regarding the experience and other technical qualifications of the respondent nos. 5 to 7, this Court does not find it necessary to make any observations regarding the competence or otherwise of the respondent nos. 5 to 7 in terms of experience.
36. This Court finds itself even otherwise to be limited in its capabilities of evaluating the Technical qualifications of each of the bidders as that has been evaluated already by two Experts' Committees constituted by the Competent Authority and the Procuring Authority.
37. In view of the discussion made hereinabove, both the writ petitions are dismissed.
Order Date :- 30.1.2023 Nitesh