Gauhati High Court
Sargous Tours And Travels And Anr. vs Union Of India (Uoi) And Ors. on 14 August, 2003
Equivalent citations: AIR2004GAU53, (2004)2GLR283, AIR 2004 GAUHATI 53, 2004 (2) CTLJ 437, (2004) 2 GAU LR 283, (2003) 3 GAU LT 202, (2004) 3 CIVLJ 435
Author: I.A. Ansari
Bench: I.A. Ansari
ORDER I.A. Ansari, J.
1. In a State, which is governed by rule of law, every tender process set in motion by the State or its instrumentalities should undoubtedly, be transparent, fair and open. Can a tender process, which does not notify the procedure, which will be followed for acceptance or rejection of tenders, be described or treated as transparent, and open and if such a grievance is brought before the writ Court, should the writ Court interfere, are the questions, which have been raised in the present writ application.
2. In a nut-shell, the case of the petitioners may be described as follows :
The petitioner No. 1 is a company dealing with supply of vehicles, such as, trucks, buses and taxis and is registered as a transporter under the Head Quarters Eastern Command, Fortwilliam, Kolkata. The petitioner No. 2 is the sole proprietor of petitioner No. 1. A notice inviting tender (NIT), dated 28-12-2002, was issued by the Brigadier DDST Head Quarters Area, 101 Area, Shillong, for supply of various taxies and buses for the period commencing from 1-4-03 to 31-3-04 to various destinations. In accordance with the requirements of the NIT, the petitioner No. 2 submitted his tender in the name of petitioner No. 1 along with all requisite documents and earnest money. In pursuance of the NIT, the petitioner No. 2 was invited to participate in the open tender process to be held on 3-3-03. In all the items in which the petitioners participated, the petitioners had quoted lowest rates, but the respondent-authorities did not issue Acceptance of Tender in favour of the petitioners for the works mentioned at Sl. Nos. 26 (ABSD, Ghy to SP Hatigarh CRT), 43 (Ghy. to Narangi-local duty) and 44, (Ghy. to Shillong -- Jorhat -- Tezpur Michamarl -- Dimapur -- Rangia -- Tenga -- Silchar CHT) the petitioners having, however, been allotted the work as mentioned at Sl. Nos. 23 (FCI Ghy. to CHT ABSD) and 42 (ABSD, Ghy, Narangi -- Basistha -- Rly. Station and back CHT). Since the petitioners were the lowest bidder in respect of item Nos. 26, 43 and 44, the petitioners ought to have been, in terms of the requirement of para 8 of the NIT, invited for negotiation, but instead thereof, the works were allotted in favour of private respondent Nos. 5 and 6 violating, thus, the procedural norms set by the respondent-authorities themselves. The respondent-authorities issued Acceptance of Tender Note, dated 12-3-2003, in favour of private respondent Nos. 5 and 6 in respect of items aforementioned, though their rates were higher than those of the petitioners in all respects. Such action on the part of the respondent-authorities is illegal, arbitrary, unfair, unreasonable, capricious and against the principles of natural justice. The petitioners have been carrying on the work of supply of vehicles as mentioned hereinbefore to the fullest satisfaction of the authorities concerned. Thus, the exercise of the power by the respondent-authorities is on extraneous considerations and contrary to the factors governing the public interest and public welfare. The exercise of power is, thus, colourable in nature. The petitioners have, therefore, approached this Court seeking issuance of appropriate writ or writs setting aside and quashing the impugned Acceptance of Tender Note, dated 12-3-2003, aforementioned and commanding the official-respondents to issue allotment of work, in question, in favour of the petitioners.
3. The respondent-authorities, namely, respondents Nos. 1 to 4, have resisted the reliefs as sought for by the petitioners, the case of these respondents being, briefly stated, thus : The Army-authorities conclude contracts for supply of civil hired transport mainly taxies, buses and load carriers on annual basis from amongst contractors, whose names appear in the list of approved contractors maintained by the Head Quarters Eastern Command (Supply & Transport Branch), Kolkata. These contracts are concluded by open tendering by the Deputy Director of Supply & Transport (i.e., DDST) on behalf of the General Officer Commanding (GOC), 101 Area, Shillong, who constitutes a Board of Officers for processing the tenders and a panel of two senior Army Officers of the rank of Brigadier and Colonel and a representative of Controller of Defence Accounts, who is a senior officer of Indian Defence Accounts Services Cadre. The Deputy Director of Supply & Transport, who is an officer of the rank of a Brigadier, is a part of this panel and he is known as the Executive Officer. The decision of the GOC, who, as per the Government Rules and Regulations, is the competent Financial Authority to finally settle all matters relating to tenders is final. In pursuance of the NIT, dated 28-12-2002, the petitioner No. 2 submitted his tender documents as per the procedure set by the respondent-authorities on 3-3-2003. The tenders were opened by the Board of Officers consisting of a Commissioned officer along with a Junior Commissioned Officer in presence of all the tenderers or their authorized representatives. The tenders were, thereafter, processed by the panel of Officers constituted as stated hereinbefore. The panel of Officers made their-recommendations taking into consideration all parameters as has been compiled in the booklet under the heading "Procedure for Conclusion of ASC Contracts", and the said recommendations had been put up before the competent Financial Authority. It is the further case of the respondent-authorities that there are several sets of parameters, which are to be taken into consideration by the competent Financial Authority as per terms and conditions of the contract amongst other things and the Financial Authority is empowered either to accept or reject any tender in whole or in part without assigning any reason or cause whatsoever. Extract of Para 13 of IAFZ-2137, relating to Invitation to Tender and Instruction to Tenders, reads as under :
"The approval or rejection of tenders rests with GOC 101 Area who reserves to himself the right to reject any tender in whose or part and item in whole or part in respect of any or all the delivery points shown in Schedule (i.e. IAFZ-2121) without cause assigned. The lowest tender will not necessarily be accepted".
Further, Para 8 of the NIT has been enlarged by Para 74 of the letter, dated 22nd Nov. 2000, of the Government of India, Ministry of Defence, which lays down that the tenders below 20% of reasonable rates would be rejected as fictitious. This condition has been incorporated to ensure that the services offered by the tenderer are maintained at the desired level. The petitioners cannot claim negotiation on account of the fact that their tenders were the lowest. Relevant paragraphs relating to sanction of contracts, which find place in the Government of India letter referred to above, have been relied upon by the respondent-authorities in support of their case. In the present case, upon opening of the tenders submitted by the writ petitioners, it was found that the rates offered by the petitioners in respect of item Nos. 26, 43 and 44 were far lower than the Reasonable Rates (RR) fixed by the authorities concerned in terms of Para 74 aforementioned and the same having, thus, been found to have been unfit for consideration was rejected and the work orders in the form of Acceptance of Tender Notes (AT Notes) were issued in favour of respondents Nos. 5 and 6. This was done in conformity with the requirements of law inasmuch as their rates were found to be the lowest in the light of the RR fixed by the authorities concerned.
The fact that the petitioners were carrying on the contract works mentioned at serial Nos. 26, 43 and 44, when the NIT, in question, was issued is immaterial inasmuch as the contracts are allotted afresh annually. The guidelines contained in para 74 are/were universally applied in respect of all items mentioned in the NIT and in every case, where the rates quoted by a tenderer are found to be below 20% of the RR, the panel of the Officers call the tenderer for discussion/negotiation giving, thus, the tenderer concerned an opportunity to justify the rates quoted and, then, only the tenders are either accepted or rejected. Since the petitioners have been working as supplier of transports with the respondent-authorities, they knew about the requirements of a valid tender and they also knew, because of their experience working with the respondent-authorities, about the concept and requirements of RR. The fact that para 74 would be applied to the present tender process too and the fact that if any rate submitted by any tenderer is below the RR, then, such tender would not be accepted were known to the petitioners. In terms of para 74, the petitioners too were given an opportunity to justify their rates. Even in respect of item No. 42, the petitioner's rate was found to be lower than the RR, but on being called to justify the rates offered, since the petitioners justified their rates, the same were accepted by the respondent-authorities, but as regard other items, the petitioners failed to justify that the rates offered by them were workable and, hence, their tenders were rejected. Thus, the decision-making process suffered from no illegality, procedural or otherwise, and no case for issuance of writ or writs under Article 226 of the Constitution could be made out by the petitioners. The respondent-authorities have acted in accordance with law and in the interest of State. There is no infirmity in awarding the contract works in favour of respondents Nos. 5 and 6. There is, therefore, no merit in the present writ petition and the same may be dismissed.
4. Respondent No. 5 has also contested the claim of the petitioners, the case of respondent No. 5 being, in brief, as under :
Awarding of contract works mentioned in item Nos. 43 and 45 in favour of respondent No. 5 is wholly consistent with law and the relevant policies/guidelines issued by the authorities concerned. Allotment of works was made on finding that, the rates offered by the respondent No. 5 were most appropriate and nearest to the RR. There was nothing mala fide, there was no illegality and no violation of the conditions of the NIT. The writ petition is wholly without merit and the same deserves to be dismissed and the interim directions issued by this Court, on 21-3-2003, need to be vacated and/or modified inasmuch as continuance thereof would cause grave prejudice, irreparable loss and injury to the respondent No. 5.
5. Reacting to the above ease set up by the respondent-authorities, the petitioners have submitted an additional affidavit, their further case being as follows :
The petitioners came to know about the concept of RR only after filing of affidavit-in-opposition by the respondent-authorities. No negotiation was ever entered into by the respondent-authorities with the writ petitioners before awarding the contract works in favour of respondents Nos. 5 and 6. The petitioners were never called for any negotiation. Considering the undertaking given by the petitioners, the authorities awarded the contract to the petitioners other than the ones mentioned under serial Nos. 26, 43 and 44. The petitioners were merely called by the authorities concerned to file an affidavit giving an undertaking that they would be able to run the contract at the rate offered by them as against the item No. 42, but no opportunity was given to the petitioners to justify their rates in respect of allotment of work orders, in question. In view of the fact that the petitioners had already recovered the value of their vehicles and as the prices of the essential oil had gone down compared to previous year, their rates quoted were lower than those of others.
6. I have perused the materials on record including the relevant records as produced by the respondent-authorities. I have heard Mr. Nilay Dutta, learned senior counsel, appearing for the petitioners, Mr. S. Bhattacharjee, learned Addl. Central Government Standing Counsel, appearing for the Union-respondents Nos. 1 to 4, and Mr. K. N. Choudhury, Learned senior counsel appearing for the respondent No. 5. Respondent No. 6 has not contested the case and none had appeared on its behalf.
7. Presenting the case on behalf of the petitioners, Mr. N. Dutta, learned senior counsel, has submitted that the NIT did not, admittedly, inform the tenderers about the existence of para 74 and about the concept of RR. This apart, submits Mr. Dutta, though the petitioners had been working as a transporter with the respondent-authorities, they never knew about the concept of RR as they had never been informed about the RR and the respondent-authorities have completely failed to show that the petitioners were aware of the concept of RR and/or that the concept of RR would be applied to the case at hand. Whatever conditions are, according to Mr. Dutta, laid down by a NIT, the same cannot be deviated from and the scope of the same cannot be enlarged subsequently. Support for this submission is sought to be derived by Mr. Dutta from the decision of the Apex Court in Dutta Associates Pvt. Ltd. v. Indo Merchantiles Pvt. Ltd., reported in (1997) 1 SCC 53.
8. In the case at hand, points out Mr. Dutta, the scope of the NIT has been broadened by application of para 74, which is contrary to the law laid down by the Apex Court in Dutta Associates Pvt. Ltd. (supra). It is also pointed out by Mr. Dutta that in Dutta Associates Pvt. Ltd. (supra), the Apex Court has clearly laid down that fairness demands that the authority should state in the tender notice itself the procedure, which would be adopted for accepting the tenders. The instructions contained in para 74 aforementioned, according to Mr. Dutta, form internal communication of the respondent-authorities and since the same are marked confidential, the petitioners never had any access to the said letter/instructions. In such a situation, submits Mr. Dutta, the contents of the said letter/instructions cannot be relied upon by the respondent-authorities for denying the contract works to the petitioners when they were the lowest tenderer in respect of the items, in question, and they were, admittedly, qualified to participate in the tender process.
9. It is also submitted by Mr. Dutta that the Central Vigilance Commission has issued letters, dated 18-11-1998, 24-8-2000 and 3-8-2001, making it mandatory for the respondent-authorities to negotiate with the lowest tenderer, but in the case at hand, this statutory requirement was violated and it is sought to be projected on behalf of the respondents that the lowest tenderer would mean the lowest valid tenderer and that any tenderer, whose rate is rejected on the ground that the same was lower than the RR, would not be a valid tenderer. If such an interpretation, according to Mr. Dutta, is given to the letter of the, CVC then, it would open the flood-gates for corruption and arbitrariness.
10. It is further submitted by Mr. Dutta that the respondent-authorities have violated even the provisions of para 74 inasmuch as no negotiation and/or discussion ever took place between the respondent-authorities and the writ petitioners before the petitioners' offer in respect of item Nos. 26, 43 and 44 was rejected, though even for such rejection, para 74 made it mandatory for the respondent-authorities to negotiate with the tenderer and give them an opportunity to show cause. The petitioners have categorically stated, points out Mr. Dutta, that they were never called upon to justify their rates in respect of item Nos. 43, 44 and 26, but no contrary assertion by way of sworn affidavit has been made by the respondent-authorities on the said testimony. Thus, according to Mr. Dutta, violation of para 74 is clearly established. By interim order, dated 21-3-2003, this Court, points out Mr. Dutta, gave liberty to the respondent-authorities to make alternative arrangements in respect of item Nos. 43, 44 and 26 without involving the respondents Nos. 5 and 6 and on the basis of this interim direction, the respondent-authorities have allowed the petitioners to provide the services in respect of item Nos. 43 and 44 with effect from 1-4-2003 and till today, the petitioners have been providing the services in respect of the said items, which clearly establishes that fixation of RR in respect of item Nos. 43 and 44 is ex facie absurd. Since the petitioners are willing to supply and are capable of supplying the vehicles as per their rates quoted in respect of item Nos. 43 and 44, awarding of these contract works in favour of private respondents at higher rates is, contends Mr. Dutta, not only an abuse of the power but also contrary to the public interest. Such arbitrariness, according to Mr. Dutta, should not be allowed to continue. Reliance in support of his submissions is placed by Mr. Dutta on the decisions in Air India Ltd. v. Cochin International Airport Ltd.. reported in (2000) 2 SCC 617 : (AIR 2000 SC 801), Centre for Public Interest Litigation v. Union of India, reported in (2000) 8 SCC 606 : (AIR 2001 SC 80), Ramana v. Indian Airport Authority of India, reported in AIR 1979 SC 1628, M/s. G. J. Fernandez v. State of Karnataka, reported in AIR 1990 SC 958, Asia Foundation & Construction Ltd. v. Trafalgar, reported in (1997) 1 SCC 738, Joy Bee Energey Services Pvt. Ltd. v. Oil India Ltd., reported in 2002 (i) GLT 329 and S. K. Rai v. Union of India, reported in 2002 (3) GLT 463 : (AIR 2003 Gauhati 313).
11. It is also contended by Mr. Dutta that the RR has been fixed in such a manner so as to favour the private respondents Nos. 5 and 6 and this is clear, according to Mr. Dutta, from a close reading of the RR fixed and the offers made by the petitioners as well as the private-respondents. The decision making process, thus, according to Mr. Dutta, suffers from mala fide and the same cannot be upheld.
12. Fixation of rates in the present case, according to Mr. Dutta, is not very technical in nature and, hence, it is clear that when the petitioners are willing to supply vehicles at the rates quoted by them, there is no justification why the State shall pay more just to maintain the RR fixed by the respondent-authorities.
13. Controverting the submissions made on behalf of the petitioners, Mr. S. Bhattacharjee, learned Additional Central Government Standing Counsel, has submitted that the petitioners having worked with the respondent-authorities must be presumed to know about the existence of para 74 and that the concept of RR would be applied for settlement of every tender. The requirements set by para 74, according to Mr. Bhattacharjee, must be deemed to exist as a condition of the NIT, in question, and the respondent-authorities cannot be said to have deviated from the conditions laid down in the NIT. The law laid down in Dutta Associates (supra), according to Mr. Bhattacharjee, does not apply to the case at hand. Mr. Bhattacharjee has also submitted that the respondent-authorities had given adequate opportunity to the petitioners to justify their rates even in respect of item Nos. 26, 42, 43 and 44, but while the writ petitioners could justify their quoting of rates in respect of item No. 42, they would not justify the rates in respect of the remaining items and, hence, the authorities were wholly justified in rejecting the petitioners' offer. Mr. Bhattacharjee has also pointed out that the RR was fixed by the respondent-authorities on the very day of re-opening of tenders, but before the tenders were opened. Mr. Bhattacharjee further submits that when the petitioners were found to have quoted rates, in question, which were lower than the RR, the petitioners were given due opportunity to justify their rates, but as the petitioners failed to do so in respect of item Nos. 26, 43 and 44, the contract works could not be allotted to them in respect of the said items.
14. In the case at hand, contends to Mr. Bhattacharjee, the allotment of works in favour of respondents Nos. 5 and 6 is wholly Justified, in accordance with law and deserves to be maintained.
15. As far as Mr. K. N. Choudhury is concerned, his submission is that Dutta Associates (supra) does not lay down the law of universal application and/or general in nature and the law laid down therein must be treated to have been kept confined to the facts involved in the said case. In the case at hand, points out Mr. Choudhury, the petitioners nowhere submitted and/or stated that they had been prejudiced by either application of para 74 and/or for the reason that the NIT did not disclose that para 74 would be applied to the NIT. It is also submitted by Mr. Choudhury that since the petitioners have been working with the respondent-authorities as a transporter, they must be deemed to have known about the existence of para 74. It is further submitted by Mr. Choudhury that the respondent-authorities have clearly brought on record that the petitioners had been given due opportunity to justify their rates, but the petitioners failed to do so and, hence, the contract works were allotted in favour of the private-respondents. In granting of such work orders, according to Mr. Choudhury, the respondent-authorities did not act mala fide nor did they act contrary to law and public interest. Allotment of works, therefore, according to Mr. Choudhury, deserves to be maintained. Reliance in support of his submission is placed by Mr. Choudhury on Bharat Singh v. State of Haryana, 1988 (4) SCC 534 : (AIR 1988 SC 2181).
16. Controverting the above submissions made on behalf of the contesting-respondents, Mr. Nilay Dutta has pointed out that the official records, as produced by the respondent-authorities, give no indication at all that the RR was fixed before the tenders were re-opened. In fact, points out Mr. Dutta. the records produced by the respondent-authorities give no indication at all that any contemporaneous record of the proceeding was maintained. In the case at hand, points out Mr. Dutta, the tenders were re-opened on 3-3-2003 and on being asked to submit their affidavit, the writ petitioners submitted, on 4-3-2003, their affidavit justifying their rates in respect of item No. 42, but there is nothing on the record to show that any negotiation took place in respect of remaining items in dispute and/or that the petitioners were given any opportunity to justify their rates in respect of the disputed items.
17. As regards Mr. K. N. Choudhury's submission that the petitioners having not pleaded any where in the writ petition that they had been prejudiced for not granting work orders in respect of items, in dispute, Mr. N. Dutta has pointed out that in the case at hand, prejudice caused to the interest of the petitioner is apparent on the face of the record inasmuch as they have been illegally, unjustly and deliberately not given the work orders in respect of items, in dispute, by taking resort to the concept of RR. which the NIT, in question, never disclosed to be of relevance in determining the eligibility of a tenderer. In a situation, such as this, contends Mr. Dutta, it will be too technical an approach on the part of any Court to hold that on account of the fact that the petitioners have not mentioned the word 'prejudice' in the writ petition, no prejudice can be taken to have been caused to the petitioners. The facts stated in the writ petition speak, according to Mr. Dutta, loud and clear that prejudice has been caused to the petitioners.
18. Upon hearing the learned counsel for the parties and upon perusal of the materials on record, what transpires is that the respondent authorities rely heavily on paragraphs 63, 70 and 74 of the Government of India, Ministry of Defence letter, which lay down the policy regarding determination of reasonable rates (RR) and rejection of tender if the rate quoted in the tender is below 20% of the RR. For the sake of brevity, the relevant paragraphs prescribed by the Government of India's letter aforementioned and referred to by the respondent-authorities are reproduced below :
"Para 63 : The Reasonable Rates (RR) once determined will be put down in writing and signed by the panel of officers and will be kept in a sealed cover. No changes will be made to these rates thereafter. These rates will be then attached to the CST for perusal of the sanctioning authorities. Normally RR once fixed will not be revised. However, if revision of RR has to be done because of unavoidable reasons, detailed justification will be given in the panel proceedings.
Para 70 : The Panel of Officers will be responsible to examine the tendered rates in hand in relation to the Reasonable Rates which have been decided earlier on Para 74 : In case rates quoted are lower than 20% of RR, the same will be treated as fictitious and rejected by the Panel of Officers. Action should be taken against such tenderers, as per the prescribed procedure. However, the decision to reject such tenders may be taken by the panel only after discussion with the tenderers and reasons for rejection/acceptance should be recorded in the panel proceedings."
19. From a careful reading of what have been laid down in paragraphs 63, 70 and 74, it is clear that tenders in which the rates quoted are less than 20% of the RR have to be rejected, but this rejection under para 74 is not automatic inasmuch as the power to reject any tender, which quotes a rate lower than 20% of the RR as fictitious, is subject to the condition that the decision to reject the tender must proceed by a discussion with the tenderer by the authorities concerned. This discussion is not a mere formality inasmuch as para 74 reveals that following such discussion with the tenderers, the tender may not only be rejected but may even be accepted and for such acceptance or rejection, reasons have to be assigned. It is thus, clear that rejection or acceptance of tender merely on the ground that the rate quoted by the tenderer is less than 20% of the RR is, if I may reiterate, not automatic; far from this, though RR is determined for the purpose of disallowing submissions of fictitious tenders, yet the fact remains that the tenderer needs to be called for discussion and if he can justify his rates, though lower than the RR, such rates have to be accepted and if the same are not accepted, reasons thereof have to be assigned. The reasons to be so assigned cannot, however, be perfunctory in nature.
20. Coupled with the above, the letter, dated 18-11-98, read with letters, dated 24-8-2000 and 3-8-2001, issued by the Central Vigilance Commission shows that these directions are statutory in nature inasmuch as the same have been issued under Section 8(1)(h) of the Central Vigilance Commission Ordinance, 1998. In the letter, dated 18-11-98 aforementioned, the CVC has stated to the effect that it is the post-tender negotiations, which form the main source of corruption, and, hence, post-tender negotiations are banned with immediate effect except in the case of negotiations with lowest tenderers. As far as the letter, dated 3-8-2001, is concerned, this letter clarifies that the post-tender negotiations are not permissible except with the lowest tenderer if the tender relates to award of work/supply orders, where the Government of India has to make payments.
21. In view of the fact that para 74 makes it more than abundantly clear that post-tender negotiations are not merely permissible, but mandatory in case of tenderer, whose rates are lower than 20% of the RR, it logically follows, in the light of the three letters aforementioned of the CVC, that even in a case, where the lowest tenderer has quoted rates 20% lower than the RR, Post-tender negotiations can be only which such tenderer. It can, therefore, be safely held that the lowest tenderer may be a tenderer, who has quoted rates at par with RR or above the RR or even less than 20% of the RR. In other words, no tender can be straightway rejected: on the ground that rate quoted therein is less than 20% of the RR and, hence, if I may repeat, negotiation with such tenderer is not only permissible, but imperative. If on negotiation and/or discussion, as the case may be, the rates quoted are found unworkable, the same may be rejected. In the case of such rejection, in the light of the letters of the CVC, new tenders have to be invited and such new tenders can, indeed, be invited on the basis of limited or short notice as indicated by letter, dated 24-8-2000, of the CVC.
22. Keeping in view the above scope and ambit of para 74 vis-a-vis the letters aforementioned of the CVC, let me, now, come to the question as to whether the NIT can be sustained in the light of the law laid down by the Apex Court in DUTTA Associates (supra). In this ease, out of 17 tenders received, tenders of tenderers placed at Sl. Nos. 1 and 2 were found ineligible and were, therefore, excluded from consideration. On such rejection, the offer of the tenderer placed at Sl. No. 3, namely, Dutta Associates Private Limited, which was the lowest tenderer amongst the eligible ones, was not accepted by the official-respondents; rather, the officials determined what they called Viability range'. This viability range was said to have been determined keeping in view the prevailing prices outside the State inasmuch as most of the rectified spirit to be supplied under the contract had to be procured from outside the State. Though the offer of the tenderer placed at Sl. No. 11 was lowest within the viability range, the State-officials did not invite even this tenderer to allot the work. They called upon Dutta Associates Private Limited to revise its offer, which it did and its bid was accepted. This was challenged before the Gauhati High Court. The learned single Judge dismissed the writ petition, but on appeal, the Division Bench directed issuance of fresh tenders. The Apex Court, while dealing with this case, laid down as follows :
"............Firstly, the tender notice did not specify the 'viability range' nor did it say that only the tenders, coming within the viability range will be considered. More significantly, the tender notice did not even say that after receiving the tenders, the Commissioner/ Government would first determine the 'viability range' and would then call upon the lowest eligible tenderer to make counter-offer. The exercise of determining the viability range and calling upon Dutta Associates to make a counter-offer on the alleged ground that he was the lowest tenderer among the eligible tenderers is outside the tender notice. Fairness demanded that the authority should have notified in the tender notice itself the procedure which they proposed to adopt which accepting the tender. They did nothing of that sort. Secondly, we have not been able to understand the very concept of 'viability range'........., The tenderers are all hard-headed businessmen. They know their interest better. If they are prepared to supply rectified spirit at Rs. 11.14 per LPL or so, it is inexplicable why should the Government think that they would not be able to do so and still prescribe a far higher viability range.....Thirdly, the Division Bench states repeatedly in its judgment that having determined the 'viability range', the government called upon only the appellant-Dutta Associates (third respondent in the writ petition/writ appeal) to make a counter-offer to come within the Viability range and that his revised offer at the higher limit of the 'viability range' (Rs. 15.71) was accepted. The Division Bench has stretched that no such opportunity to make a counter-offer was given to any other tenderer including the first respondent. As the Division Bench has been rightly pointed out, this is equally a vitiating factor.
It is thus clear that the entire procedure followed by the Commissioner and the Government of Assam in accepting the tender of Dutta Associates (appellant herein) is unfair and opposed to the norms which the Government should follow in such matters, viz.. openness, transparency and fair dealing. The Grounds 1 and 2, which we have indicated hereinabove are more fundamental than the third ground upon which the High Court has allowed the writ appeal."
23. From a close reading of what have been observed above by the Apex Court, it is clear that there were altogether three grounds, which according to the Apex Court-made the acceptance of the tender by the Government unsustainable. Out of these three grounds, grounds Nos. 1 and 2 aforementioned were held to be more fundamental than the third ground. This clearly shows that since ground Nos. 1 and 2 are fundamental in nature, the grounds laid down therein are imperative and must be followed in every tender process and omission to follow the law laid down in ground Nos. 1 and 2 will vitiate the acceptance of tender. In other words, the law laid down in Dutta Associates (supra) with regard to, at least, ground Nos. 1 and 2 are general in nature and must be applied in every tender process. A close reading of ground Nos. 1 and 2 aforementioned clearly shows that the tender notice, according to the Apex Court, ought to have stated that after receiving the tenders, the Commissioner/Government would, first, determine the Viability range' and would, then, call upon the lowest eligible tenderer to make a counter-offer and, secondly, the concept of viability range' was not appealing to reasons. In the present case, since the question of viability range is not involved, one has no option, but to hold that if in a tender process, the tender notice does not state as to what considerations would prevail upon the authorities concerned in accepting or rejecting the tender then, such a tender process is not sustain-able. In other words, every NIT must disclose the procedure, which would be followed in the matter of acceptance of tender so that the entire tender process becomes transparent, fair and open.
24. I am guided to adopt the above view from the following further observations made in Dutta Associates (supra) :
"......We reiterate that whatever procedure the Government proposes to follow in accepting the tender must be clearly stated in the tender notice. The consideration of the tenders received and the procedure to be followed in the matter of acceptance of a tender should be transparent, fair and open. While a bona fide error or error of judgment would not certainly matter, any abuse of power for extraneous reasons, it is obvious, would expose the authorities concerned, whether it is the Minister for Excise or the Commissioner of Excise, to appropriate penalties at the hands of the Courts, following the law laid down by this Court in Shiv Sagar Tiwari v. Union of India, (1996) 6 SCC 558 : (AIR 1997 SC 1483) (In re, Capt. Satish Sharma and Sheila Kaul (sic).
(Emphasis is added)
25. In the case at hand, there is no dispute before me that the NIT did not speak of the fact that there would be RR determined by the authorities concerned and if any tenderer quotes a rate, which is lower than 20% of the RR, then, such a tender would be rejected.
26. In view of the fact that I have already held that the law laid down in Dutta Associates (supra) is bound to be followed in every tender process and the primary requirement of a tender process to remain valid is that it must notify the intending tenderers of the procedure that the authorities concerned propose to follow in accepting the lender, it clearly follows that omission to mention about the concept and working of RR is fatal in the present case. It is, no doubt, true that the petitioners have been working with the authorities concerned and though, ordinarily, they were likely to know about the existence of the RR. the fact remains that in the face of categorical assertions made, on oath, by the writ petitioners that they had not been informed about the RR, it was the duty of the respondent-authorities to show by producing materials on record that the RR were within the knowledge or information of the writ petitioners. In this regard, the respondent-authorities have miserably failed inasmuch as there is nothing in the materials on record to show that the petitioners were aware of, and/or had been informed about, the existence of the RR and/ or of the fact that the tender, which quotes a rate, which is lower than 20% of the RR, would not be accepted. Viewed from this angle, omission to mention in the NIT the fact that quoting of rates must not be less than 20% of the RR, which may be fixed by the authorities concerned, one has no option but to hold that the procedure to be followed had not been notified in the NIT and in such a situation, the procedure adopted cannot be said to be, as held in Dutta Associates (supra), transparent, fair and open.
27. In view of the fact that I have already held that since the NIT did not disclose about the existence of the RR, the rejection of the tender on the ground that the rates quoted by the petitioners were less than 20% of the RR and could not be justified by them is clearly against the law laid down by the Apex Court in Dutta Associates (supra) and cannot be sustained. It is, therefore, not necessary for this Court, now, to enter into the question as to whether in fixing of RR, the respondent-authorities have acted mala fide or with ulterior motive and/or rejection of the petitioners' tender was aimed at giving benefit to the private-respondents or not.
28. As regards Mr. K. N. Choudhury's submission that the petitioners have not mentioned in their writ petition that they had been prejudiced by rejection of their offer in respect of item Nos. 26, 43 and 44, suffice it to mention here that if the contents of any writ petition reveal that the petitioner has been prejudiced by any act(s) or omission(s) of the official-respondents, the Court cannot refuse to entertain such writ petition by merely taking resort to the fact that the petitioner has not specifically and categorically stated in the writ petition that he/she stands prejudiced by such act or omission of the official respondents. Such an approach by a Court, while dealing with a writ application, will be too pedantic and defeat the very purpose for which Articles 226 and 227 stand incorporated in the Constitution of India as a part of basic structure thereof. Hence, the mere fact that the petitioners have not stated in the present writ petition that they have been prejudiced by rejection of their tenders, the same will not be sufficient for the Court to refuse to look at the grievances of the petitioners. In fact, a careful reading of the averments made in the writ petition shows that according to the petitioners, they have been denied their rightful claim to receive the work orders by adopting a procedure, which was not notified in the NIT. Coupled with this, when this Court has already held that the NIT did not clearly reveal the procedure, which was to be followed in accepting or rejecting the tenders, the entire tender process suffered from violation of law governing a valid tender process. In such a situation, I find considerable force in the submission of Mr. Dutta that prejudice caused to the petitioners is apparent on the face of the record.
29. In the result and for the foregoing reasons, this writ petition succeeds. The impugned Acceptance of Tender Notes, dated 12-3-2002, and the work orders, dated 12-3-2003, issued in favour of the respondents Nos. 5 and 6 are hereby set aside and quashed. The respondent-authorities are hereby directed to float, within two months from today, tenders afresh and while inviting such fresh tenders, the respondent-authorities shall bear in mind the observations made in the preceding paragraphs of this judgment and order. Until such time that the fresh tenders are finalized, as directed, in accordance with law, the interim arrangements made by the respondent-authorities in respect of item Nos. 26, 43 and 44 may be continued.
30. There shall be no order as to costs. Petition allowed.