Gujarat High Court
Bharat Parenterals Limited vs State Of Gujarat on 21 October, 2022
Author: Aravind Kumar
Bench: Aravind Kumar, Ashutosh J. Shastri
C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 20436 of 2022
FOR APPROVAL AND SIGNATURE:
HONOURABLE THE CHIEF JUSTICE MR. JUSTICE ARAVIND
KUMAR
and
HONOURABLE MR. JUSTICE ASHUTOSH J. SHASTRI
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1 Whether Reporters of Local Papers may be allowed to see
the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy of the
judgment ?
4 Whether this case involves a substantial question of law
as to the interpretation of the Constitution of India or any
order made thereunder ?
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BHARAT PARENTERALS LIMITED
Versus
STATE OF GUJARAT
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Appearance:
MR.SHALIN MEHTA, SENIOR COUNSEL WITH MR SAURIN A
MEHTA(470) for the Petitioner(s) No. 1,2
KRISHAL H PATEL(9644) for the Petitioner(s) No. 1,2
for the Respondent(s) No. 2
MRS.MANISHA L. SHAH, GOVERNMENT PLEADER WITH
MR.K.M.ANTANI, AGP for the Respondent(s) No. 1
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CORAM:HONOURABLE THE CHIEF JUSTICE MR. JUSTICE
ARAVIND KUMAR
and
HONOURABLE MR. JUSTICE ASHUTOSH J. SHASTRI
Page 1 of 46
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C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022
Date : 21/10/2022
CAV JUDGMENT
(PER : HONOURABLE THE CHIEF JUSTICE MR. JUSTICE ARAVIND KUMAR [1] By way of this petition under Article 226 of the Constitution of India, petitioners have prayed for following reliefs:-
A. YOUR LORDSHIPS may be pleased to issue a Writ of Mandamus or a Writ in the nature of Mandamus, or any other appropriate writ, order or direction, quashing and setting aside the impugned decisions/order/ Scrutiny Report of Respondent No. 2 GMSCL dated 01.07.2022 in respect of Tender Notice No. GMSCL/D-24/2021-2022 and Tender Enquiry No. GMSCL/D-686/ RC/2021-22 (ON RATE CONTRACT BASIS) and direct the Respondents to consider the price-bid of the Petitioners:
B. Pending hearing and final disposal of the Petition, YOUR LORDSHIPS may be pleased to stay the implementation, operation and execution of the impugned decisions/ Scrutiny Report of Respondent No. 2 GMSCL dated 01.07.2022 in respect of Tender Notice No. GMSCL/D 24/2021-2022 and Tender Enquiry No. GMSCL/D 686/RC/2021-22 (ON RATE CONTRACT BASIS) and further be pleased to stay the further scrutiny of Tender and also direct Respondents not to issue Acceptance Letter and allot the Tender and further direct the Respondent No.2 to reconsider the Representation applying the Guidelines dated 02.11.2021 issued by Government of India, Department of Expenditure, Ministry of Finance, Procurement Policy Division;
C. YOUR LORDSHIPS maybe pleased to grant ex-parte ad interim relief in terms of Para 8(C);
D. YOUR LORDSHIPS may be pleased to grant such other and further relief/s, as may be deemed fit by this Hon'ble Court, in the interest of justice.
Page 2 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 [2] Facts in brief as narrated in the Special Civil Application are that petitioner No.1 is a company registered under the provisions of the Indian Companies Act, 1956 and is being represented by its authorized person, i.e. petitioner No.2. Petitioner company is engaged in the manufacture, supply and sale of pharmaceutical products across the country over past 26 years. Petitioner No.1 had a tremendous growth track record and has been considered to be the best pharmaceutical company in India. Petitioner No.1 company has received best manufacturer SME since 5 years till the year 2022 from Times Group and co-sponsored with Ministry of MSME. Petitioner is having its own manufacturing facility with an ultramodern Quality Control Laboratory and is a well- equipped company in the manufacturing field of pharmaceuticals. Petitioner No.1 has GMP approval of the State. Plant has also been approved from foreign Drug Auhoroty like NAFDAC of Nigeria, FDB of Ghana, DPM of Ivory Coast, PMPB of Malawi and several other approvals from other countries. Product of the petitioner company was available even in foreign countries as well, as indicated in paragraph 2.2 of the Special Civil Application. Page 3 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 [3] Respondent No.2 - Gujarat Medical Services Corporation Limited (for short "GMSCL') is a procuring agency of Government of Gujarat, which procures drugs, surgical items, etc. from different manufacturers and distributors for supply of such products to the Government hospitals throughout State of Gujarat. A monopoly has been created by the State in the field of procurement and supply of drugs and surgical items to the Government hospitals across the State. In furtherance of this function, respondent No.2 floated a tender bearing Tender Enquiry No.GMSCL/D-686/RC/2019-20 inviting for Tablet, Capsule, Injection and Miscellaneous other drugs items (64 items in number) in the month of December 2021. Offers were invited from reputed manufacturers for supply of such medicine drugs for a period of two years on rate contract basis. Said tender was floated with due date and time of submission of technical bid and commercial bid (online) prescribed as 12.1.2022 upto 1800 hours, due date for physical submission of technical supporting document inclusive of document was 13.1.2022 upto 1800 hours, whereas, due date and time for opening of tender bid (online) as 17.1.2022 at 1500 hours. Page 4 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 Petitioner accordingly submitted its bid for four items, i.e. Item Code 1017 Amoxicillin Capsules IP 250 mg, Item Code 1403 Trimethoprime & Sulphamethoxazole 160 mg and 800 mg tablet, Item Code 2014 Atracurium Besylate Injection IP 10 mg/ ml and Item Code 2020 - Injection Bupivacaine HCL Anhydrous (Heavy (Spinal) (4 ml Amp). The Agency has confirmed the same by email communication and petitioner has submitted a bid submission report dated 12.1.2022.
[4] It is the case of the petitioners that by that time, Government of Medical Store Depot, New Delhi, Directorate General of Health Services, Medical Store Organization (MSO) invited a bid for rate contract for supply of Generic drugs for a period of two years in the year 2019-20, in which petitioner was declared as successful bidder in several products, including Pantoprazole Table I.P. 40 mg and Rosuvastatin Tablets I.P. 20 mg. But, during subsistence of said contract, a show cause notice came to be issued on 5.1.2021 by the Medical Government Store Depot, Mumbai on behalf of Ministry of Health and Family Welfare for de-registering/ debarring the petitioner firm for a period of 3 years since the drug named as Page 5 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 Rosuvastatin Tables IP 20 mg supplied by it did not confirm to the standard requirement with respect to test for dissolution as it was found to be 'Not of Standard Quality'. Yet, another show cause notice was received by petitioners on 4.2.2021 with respect to yet another drug named as Pantoprazole Tables IP 40 mg. which also does not confirm IP 2018 standard with respect to its dissolution test and was found to be not of a standard quality. In respect of both these notices, replies came to be filed by the petitioner on 21.1.2021 and 15.2.2021 respectively, but then it is the case of the petitioners that without affording any opportunity of personal hearing, a blacklisting step was indicated for a period of 3 to 5 years, which was otherwise not stated in the show cause notice and ultimately, issued an order on 2.11.2021, debarring the petitioner company for supply of all products to MSO/ GMSD for a period of 5 years from 5.4.2021 since drugs supplied by the petitioner was found to be of substandard quality. It is the case of the petitioners that said order is challenged before the High Court of Bombay by Writ Petition (L) No.29081 of 2021 and same is pending for further hearing after issuance of notice.
Page 6 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 [5] It is the further case of petitioners that even after the said order of debarment dated 2.11.2021, petitioner has been considered by different States and its tender has been accepted and/or has been awarded contracts considering the guidelines issued by Department of Firm on bidding. Letters of Acceptance of different States have been appended to the petition compilation.
[6] Petitioners have further stated that in the meantime, in compliance of the tender conditions in Annexure-IV, an affidavit along with explanation came to be submitted indicating that company has been debarred from supplying all products to MSO/ GMSD for 5 years since its only two samples related to drugs having failed in dissolution test and it has been pointed out that guidelines on debarment from bidding dated 2.11.2021 indicates that said order of debarment shall be made applicable only to GMSD Mumbai and not otherwise. It is the say of petitioners that despite such guidelines issued by the Government of India and despite clarifying the same, yet, in utter disregard to the tender conditions, bid of the petitioner Page 7 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 came to be rejected and it is violative of tender condition No.B-
7. It is stated that out of four products offered in the tender by the petitioner, its price bid is lowest for two products and said two products are not in the list of tender floated by the Government Medical Store Depot, New Delhi. Impugned Scrutiny Report dated 1.7.2022 provided to make a representation within 48 hours and hence, petitioners without any undue delay has explained by way of representations dated 1.7.2022 and 2.7.2022 that impugned scrutiny report is required to be reconsidered and petitioners' bid is required to be declared as eligible. Along with such representation, explanation has been provided including the relevant guidelines dated 2.11.2021, but the authority has not considered the request of the petitioners. Consideration of petitioners' request still pending and the letter of acceptance having not been issued to any other bidders, request in the form of representation has been submitted by petitioners on 19.9.2022 and 22.9.2022 and being aggrieved by action of respondent in not considering said representations and dissatisfied with the action of the respondent authority, i.e. GMSCL, in rejecting the bid at the Page 8 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 threshold by way of scrutiny report dated 1.7.2022, left with no other alternate, petitioners have approached this Court by way of present petition under Article 226 of the Constitution of India.
[7] The matter being circulated upon advance copy on 6.10.2022. Learned Government Pleader appearing on behalf of the respondent authority had submitted that no final decision would be taken till next date of hearing insofar as products for which bid has been submitted by the petitioners and others and as such, we place on record said submission and undertaking and thereafter matter has been taken up for final disposal. Pleadings have been completed by filing affidavit-in-reply and also rejoinder by petitioners and looking into urgency, namely this being a tender subject and request having been made by both learned advocates for the respective sides to take up the matter, we permitted the learned advocates to canvass their submissions on main matter by taking it up for final hearing. [8] Learned senior counsel Mr. Shalin Mehta appearing on behalf of petitioners' has vehemently contended that impugned Page 9 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 action of rejection of bid of the petitioners is not only unjust and arbitrary, but also based upon complete misreading of the relevant clauses which are applied and as such, decision making process itself from initial stage is ill-founded, hence the reliefs prayed for be granted. It has been contended that apparent look at the impugned communication at Annexure-A is clearly reflecting that petitioner has been not considered on account of tender condition No.B-7 and said condition B-7 on plain reading as it is not applicable at all and as such, decision taken by the authority is based upon misconception, non-application of mind and apparently arbitrary, hence same is required to be quashed and set aside.
[9] It has been contended by learned senior counsel Mr. Shalin Mehta that petitioner is a well-recognized manufacturer of pharmaceuticals across the country and even outside the country, products manufactured by the petitioner are being supplied throughout globe and thereto since number of years and at no point of time, such eventuality has taken place. It has been pointed out that petitioner has offered its bid only for 4 items as indicated above and has been found eligible for 2 Page 10 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 items, i.e. Item No.2 Amoxycillin Capsules 250 mg and item No.32 Altracurium Besilate Injection 10 mg/ml and price bid with respect to these two items are quite competitive and is less than what L-1 has suggested and as such, non-consideration of bid of the petitioner would adversely affect the public exchequer as well.
[10] Learned senior counsel Mr. Shalin Mehta has further submitted that undisputedly, clause B-7 of tender condition is pressed into service for ousting the petitioner from further tender process and on a plain reading of the said clause, it would clearly indicate that petitioner is neither convicted by any Court of law nor its product found spurious or adulterated and as such, when said clause B-7 is not at all applicable rejection of petitioners' bid is illegal and it would indicate decision making process itself is erroneous and as such it deserves to be quashed.
[11] It has been further pointed out that even debarment order also cannot be pressed into service for rejection of bid of the petitioner in view of the fact that such debarment is with Page 11 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 respect to only two items which are not tendered by the petitioner. By referring to said order dated 2.11.2021, it has been submitted that in respect of Pantoprazole Tablets and Rosuvastatin Tablets only, samples have not been found on a dissolution test, but the debarment order relates to items which are not related to two items for which petitioner was found to be eligible of the subject tender and as such said debarment order cannot be applied to reject the bid of the petitioner. [12] Learned senior advocate Mr. Mehta has further vehemently contended that said debarment order is dated 2.11.2021, but then even after this debarment order, there are several States which have awarded tenders to the petitioner and considered the bid. By referring to several orders issued by the the State of U.P., PMDI, State of Orissa and State of West Bengal respectively, it has been pointed out that these States have considered the tenders of the petitioner and as such, State of Gujarat cannot discriminate and disallow the bid of petitioner. According to Mr. Shalin Mehta, on the contrary, a clarification has been issued by the Government of India on 16.6.2022 clarifying in paragraph 2 that since GMSD, Mumbai Page 12 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 has blacklisted the petitioner firm, such blacklisting would be applicable only in respect of procurement being made by GMSDs but not to procurement being made by other procurement entities of the Ministry in terms of department of expenditure guidelines dated 2.11.2021 and in view of this clarification, it is not open for the respondent authority to reject the bid of the petitioner and that too under a misconception about applicability of clause B-7.
[13] Learned senior advocate Mr. Shalin Mehta has further submitted that surprisingly, during the course of proceedings, a stand is tried to be taken by altering the ground of rejection by the respondent authority by indicating that clause B-8/B is applicable and not clause B-7 which is impermissible. This is outrageously violative of the settled position of law. By affidavit- in-Reply, a stand cannot be improved or altered than what has been taken during the decision making process and on this score also, action on the part of the authority is to be held as illogical, particularly when malafides are attributed to the petitioner.
Page 13 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 [14] Learned senior counsel Mr. Shalin Mehta has further submitted that debarment order is not in respect of quoted drugs and bid which has been offered with respect to two items in which petitioner found to be lowest when compared with the rate quoted by L-1, there is huge difference in price and it is impermissible by the State authority to ignore such difference. However, the reasons which are now attempted to be supplied by way of affidavit are impermissible and as such stand taken by authority may not be accepted and in view of the aforesaid situation, which is prevailing on record, he has sought for grant of the reliefs as prayed for in the petition.
[15] By referring to the related documents attached to the petition compilation, in consonance with the aforesaid submission, learned senior advocate Mr. Mehta has vehemently contended that action on the part of the authority is impermissible, outrageously violative of the settled proposition of law, and has prayed for the reliefs being granted as prayed for in the Special Civil Application in the interest of justice. [16] To summarize his submission, learned senior counsel Mr. Page 14 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 Shalin Mehta has submitted that once a decision is taken on a particular issue, no improvement can be permitted by applying clause B-8/B to oust the petitioner from tender process. If this is permitted, this would encourage bias and predetermined approach of the authority. Even after debarment order, when other States have qualified the petitioner with respect to several items and petitioner not being a fly by-night bidder, its case deserves consideration. In addition to this, according to Mr. Mehta, even on merit also, clause B-8/B is not at all applicable as the drugs for which petitioner has been debarred is not the drug which has been tendered and apart from that, very order of debarment is subject matter of scrutiny before the Bombay High Court and taking note of the said order, High Court of Bombay also issued notice and matter is awaiting hearing. Hence, in a situation like this, rejecting the bid of petitioner is not only impermissible but will have a far-reaching consequence even upon the image of petitioner as throughout it has been found to be best manufacturer in the field of pharmaceuticals. Hence, reason which is assigned by the authority not to consider the bid of petitioner is impermissible, unreasonable, Page 15 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 irrational and arbitrary, which deserves to be corrected by quashing and setting aside the same. To substantiate his submission, learned senior advocate Mr. Shalin Mehta has relied upon the decisions reported in (2001)1 SCC 610 (paragraph 49) and (2022)6 SCC 707 (paragraph 12) to contend that reasons for rejection cannot be supplied or supplemented at a later point of time and improvise its position. Learned senior advocate Mr. Mehta has further relied upon the decision delivered by the Division Bench of this Court reported in AIR OnLine 2020 Gujarat 235 and decision dated 5.4.2022 taken by Division Bench in Special Civil Application No.20161 of 2021 by referring to relevant paragraphs and contending an attempt has been made by the respondent to justify the action by way of an affidavit, which is not permissible and as such, by referring to these decisions, a contention is raised that in no case, stand of the authority deserves any consideration. Hence, he has prayed for the reliefs sought for in the petition be granted in the interest justice.
[17] Rebutting the said contentions, learned Government Pleader Mrs. Manisha Shah appearing on behalf of authority Page 16 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 with the assistance of learned Assistant Government Pleader Mr. K.M. Antani has vehemently contended that entire stand taken by the petitioners is erroneous, impermissible and rather misconstruing the debarment order itself. It has been pointed out that subject tender is for supply of various items of medicine drugs, namely in all 64 drugs, for being supplied to Government hospitals in the State of Gujarat for a period of two years on a rate contract basis and items which are in controversy are of huge quantity and the authority cannot put to danger the lives of public by allowing substandard medicines being supplied by petitioners. For example, Amoxycillin Capsules 250 mg is a medicine demanded some 5 crores and more, whereas Atracurium Besilate Injection in large quantity and State machinery is quite clear that no substandard supply to be permitted from any corner and as such, in larger public interest also, it is not desirable that the firm, like petitioner, who is found to be not matching with the standards prescribed, there is hardly any reason for the authority to consider the stand of the petitioner. According to learned Government Pleader Mrs. Shah, there is a consistent policy of the State Government that Page 17 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 manufacturers whose product was declared as not of standard quality should be kept away from the tender process and said policy is in vogue right from 2005 by virtue of Government Resolution dated 25.10.2005 and as such, there is no erroneous approach adopted by the authority in not considering the bid of the petitioner.
[18] It has been vehemently submitted by learned Government Pleader Mrs. Manisha Lavkumar Shah that it is oversimplified by the petitioner which is not permitted at all that only for two items projected in the order of debarment, petitioner has been disqualified/ debarred and as such, for other items petitioners can be considered. She would contend this is not in consonance with the order of debarment itself. By referring to order dated 2.11.2021, she has contended that petitioner has been de- registered/ debarred for supply of "all drugs/ products" to MSO/GMSDs for a period of 5 years with effect from 5.4.2021 and reason thereto is on account of repeated failure of drugs supply. Dissolution test has not been cleared by the petitioners, may be in two items, but the debarment order explicitly indicate that such debarment is for supply of all drugs/ products and Page 18 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 therefore, for sake of convenience, petitioner cannot be permitted to contend that since dissolution test has been failed with respect to two items, except those two items, other drugs may be permitted to be considered. This is impermissible and not in consonance with the policy of the State itself. [19] Learned Government Pleader Mrs. Shah has further submitted that it may be that authority might have committed some mistake through inadvertence by mentioning condition No.B-7, but it is a settled position of law that wrong mentioning of clause will not be fatal when ultimate action is based on another substantive clause, namely Clause B-8/B. Learned Government Pleader Mrs. Shah has further submitted that clause B-8/B found in the tender condition clearly indicate that concerned company or firm who has been blacklisted / debarred by GMSCL or any other State / Central Government and its Drug Procurement Agencies due to failure in supply of Quality of Quoted drugs shall not participate in the tender during the period of debarring/ blacklisting. Learned Government Pleader Mrs. Shah has submitted that these items for which petitioner has been debarred were also quoted drugs undisputedly and as Page 19 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 such, when debarment is with respect to such quoted drugs, there is hardly any reason for the authority to accept the bid of petitioner despite this undisputed position. Hence, it has been vehemently contended that State would not be willing to allow any substandard drugs being supplied to the Government hospitals in any form which would adversely affected the users namely consumers of such drugs. Once it has been noticed that a person is found to be guilty of supply of substandard quality drugs and debarment is in existence, State authority will not consider such firm in view of their consistent policy taken in the best interest of public at large. That being so, according to learned Government Pleader, simply because a clause inadvertently invoked it will not alter the situation. Hence, in such situation, petitioner cannot be allowed to raise hyper- technical contention and allow the relevant applicable clause to sale into insignificance. Ultimately, it is settled position of law that when substantial justice is pitted against technical consideration, substantial justice must be given a preference and further wrong mentioning of a clause may not be allowed to stand as it would be fatal in the larger interest of public. Hence, Page 20 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 she would contend this is not a fit case in which the stand of petitioner can be accepted.
[20] Learned Government Pleader Mrs. Shah has further submitted that an attempt has been made to seek shelter under the guidelines issued by Government of India, which is per-se not applicable. The guidelines which are attached with the petition compilation can be classified under two heads; (i) in cases where debarment is proposed to be limited to a single Ministry the appropriate orders can be issued by that Ministry itself, thereby banning all its business dealing with the debarred firm, (ii) where it is proposed to extend the debarment beyond the jurisdiction of the particular Ministry, i.e. covering all central Ministries/ Departments, the requisite orders shall be issued by the Department of Expenditure (DoE), Ministry of Finance (MoF) and as such also, such guidelines would be of no assistance to the petitioners and in addition thereto, Government of India, Ministry of Health and Family Welfare has issued a clarificatory order dated 16.6.2022 itself is making it clear that since GMSD, Mumbai has blacklisted the petitioner firm, blacklisting should be applicable only in respect of Page 21 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 procurement being made by GMSDs but not to procurement being made by other procurement entities of Ministry and this apparently indicate that same is not binding on other agencies or applicable to the State of Gujarat or its authority and as such, this clarification or guidelines is of no assistance to the petitioners. [21] Learned Government Pleader has further submitted that there is serious defect in supply of substandard quality of drugs by the petitioner and for that reason, petitioner has been debarred from all drugs. According to learned Government Pleader Mrs. Shah, no case is made out by the petitioner. She has further submitted that in any case if petitioner is so aggrieved about applicability of clause B-7, which is apparently not applicable, then in that case, authority is ready to issue a communication to the petitioner seeking its response and then put it before the Board to take a fresh decision, but it has been conveyed that prima facie, in terms of clause B-8/B of the tender document, authorities are well within their rights to decline to entertain the bid for two drugs out of 64. Hence, there is hardly any reason for the petitioner to raise any grievance as long as petitioner is visited with the debarment order. It is also Page 22 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 contended that applicability of wrong provision or clause would not have a fatal effect on a decision and for that purpose, reliance is placed on the decisions reported in (2016)16 SCC 818 (paragraph 5) and (2004) 12 SCC 278 (paragraph 9) and by referring to these, a contention is raised that so long the power is there to reject, wrong mentioning of a clause, will not be a fatal to a decision making process as endeavour is to see that best quality drug is supplied to the Government Hospitals and to consider such type of bidders like petitioners, who have been found to have supplied defective quality of drugs. Hence, according to learned Government Pleader Mrs. Shah, petition deserves to be dismissed with costs.
[22] In rejoinder to this, learned senior advocate Mr. Shalin Mehta has submitted that it is not only wrong mentioning of a provision of law, but also wrong mentioning of a tender condition which is not a law or statutory provision and therefore, proposition which is tried to be canvassed by learned Government Pleader is not at all applicable to substantiate such plea. Mr. Shalin Mehta has referred to paragraph 54 of the decision delivered by this Court on 5.4.2022 in Special Civil Page 23 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 Application No.20161 of 2021 in support of this submission. He would contend when undisputedly, condition No.B-7 has been pressed into service, which is apparently not applicable at all, there is hardly any reason for the respondent authority to dislodge the proposition canvassed by the petitioner. It has been submitted that clause B-8 refers to quoted drugs, whereas order of debarment dated 02.11.2021 (Annexure-H) is for two items of drugs only and on account of same, petitioner cannot be outsted from consideration of tender process for other drugs. Mr. Mehta has vehemently contended that no-doubt, authority may have a zero tolerance policy but then applying such policy, law cannot be ignored and the authority may not be allowed to take an arbitrary stand. Hence, looking to the background of facts, the case of petitioners deserves to be considered and to substantiate his overall stand, the decisions which have been pressed into service are requested to be considered. No other submissions have been made.
[23] Having heard the learned senior counsels appearing for the parties and having given our anxious consideration to the controversy involved in this petition and on perusal of the Page 24 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 records placed before us, following are the circumstances which are not possible to be ignored by the Court:-
[24] First of all it is appearing from the tender notice Annexure-E that Gujarat Medical Services Corporation Limited (GMSCL) floated a tender for purchase of some 64 quoted drugs and petitioners though affected for four (4) items in this petition, we are concerned with only 2 items, namely, "Amoxycillin Capsules of 250 mg." continuity thereof is 50561000 Capsules to be supplied to Government Hospitals and another quoted drug is "Atracurium Besylate Injection of 10 mg/ ml," Item No.32 of 433000 Ampule to be supplied and such huge quantity of drugs was to be supplied for a period of 2 years on rate contract basis and for said purpose, tender came to be floated by the second respondent authority. These drugs are undisputedly specified / quoted drugs as is reflecting from the list of 64 items reflecting in the tender document.
[25] Petitioners have been undisputedly facing with an allegations of supply of defective standard product and for said Page 25 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 reason, they have been debarred for a period of 5 years with effect form 05.04.2021 and due to repeated failure of drugs supplied within a period of 1 year under Category 'A' as found by Testing Laboratories. Hence, debarment order dated 02.11.2021 (Annexure-H) came to be passed by Government of India which is quite evident from records. It was found by said authority that some of the quoted drugs supplied by petitioners was found to be not of standard quality and those drugs when tested did not conform to specified sample or in other words, it did not conform to the IP 2018 test for dissolution, which is declared as Category 'A' defect. On account of such conduct of petitioners, de-registration / debarment order dated 02.11.2021 came to be passed for supply of all drugs / products to MSO/GMSDs for a period of 5 years. Thus, it is clear that petitioners' firm is not debarred in respect of 2 items specified in the order only as claimed but has been debarred from supply of all drugs / products. It is also true that litigation in that regard is pending before High Court of Bombay as stated by the learned counsel appearing for the petitioners. However, as on date, petitioners are facing a debarment order from supply of all Page 26 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 drugs and petitioners have also been de-registered under said order.
[26] In addition to this, it also appears from the clarification issued by Government of India on 16.06.2022 (found on page 42 of the petition compilation at Annexure-A) that blacklisting of petitioner firm, would be applicable in respect of procurement being made by GMSDs only and not to procurement made by other entities of the Ministry. This clarification itself makes it clear that such clarification will not come to the rescue of the petitioners. The relevant paragraph of said clarification reads as under:-
"3.It has also been decided no to clarify that since GMSD Mumbai blacklisted the firm, the blacklisting should be applicable only in respect of procurement being made by GMSDs but not to procurement being made by other procurement entities of the Ministry, in terms of Department of Expenditure guidelines dated 02.11.2021 on Debarment of Firms from Bidding."
(emphasis supplied by us) [27] Apart from that guidelines on the debarment of firm from Page 27 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 the bidding process also indicates clearly that attempt is made by the petitioners contending that respondent authority has acted dehors the clarification is also ex facie not appealable in view of 2 types of guidelines classified by the authority. Thus we deem it proper to extract the same. It reads hereunder:-
"1.The Guidelines are classified under following two types:
(ii) In cases where debarment is proposed to be limited to a single Ministry the appropriate Orders can be issued by that Ministry itself, thereby banning all its business dealing with the debarred firm.
(ii) Where it is proposed to extend the debarment beyond the jurisdiction of the particular Ministry i.e. covering to all central Ministries / Departments, the requisite Orders shall be issued by Department of Expenditure (DoE), Ministry of Finance (MoF)."
[28] As against this, a clear stand is taken by respondent State authority in its affidavit-in-reply where a clear assertion is made that State authority is committed to its own policy not to consider the bids of manufacturers of drugs who are declared as not having supplied standard quality of drugs and those are to be kept outside the tender process. When petitioners have been Page 28 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 declared debarred by order dated 02.11.2021 (Annexure-H) from supply of all drugs, there appears to be no illegality committed by the respondent authority in adhering to its own policy. The said policy is traceable to Government Resolution dated 25.10.2005 which is appended to reply affidavit of second respondent. It reads :
"9. It is further submitted that the policy enunciated by the Government of Gujarat through the Health and Family Welfare Department vide Government Resolution dated 25.10.2005 stipulates that manufacturer whose product to declared as not of standard quality shall be kept out of tender process. the translation of relevant clause (item No.5 @ page No.173) of the Government Resolution dated 25.10.2005 reads as under:-
"Manufactures of drugs declared as not of standard quality shall be kept out of tender process"
In view of above policy of the Government, Petitioner is not eligible to participate in tender process and decision of the Answering Respondent of rejecting the bid of the Petitioner is in accordance with the law and policy of the Government.
Annexed hereto and marked as Annexure R1 is a copy of the said resolution"
(emphasis supplied by us).Page 29 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022
C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 [29] From the aforesaid policy and in view of undisputed situation that petitioners have been found to be prima facie guilty of not supplying standard quality of drugs which is clarified as defect under Category 'A', we are of the clear opinion that stand of the authority cannot be said to be erroneous in any form and not permitting the petitioners from participating from the tender process cannot be found fault with. When question of dealing with public health effecting large number of people across the State from the society who are normally taking treatment from Government Hospital is concerned, we cannot ignore the public interest behind the action of State authority being the paramount consideration, more particularly when the rate is prescribed lowest by the petitioners in respect of huge quantity of aforesaid two drugs i.e. Item Nos.2 and 32 from the list. The State is right in not compromising with the quality aspect by disallowing the petitioners from participating further in the tender process.
[30] Further, we notice that a hyper-technical argument is Page 30 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 sought to be canvassed by the petitioners contending at best petitioners have been found to be guilty of not supplying standard quality of 2 items of drugs and as such they cannot be held to be debarred from other drugs. However, we cannot ignore the fact that debarment order dated 02.11.2021 (Annexure-H) is for all drugs and further for reasons best known by impugned communication it has been indicated as tender condition No.B7 is attracted and same has been taken in aid for not allowing the petitioners from participating in tender process. It has been categorically stated by second respondent that due to inadvertence condition No.B7 has been indicated in the impugned order though factually condition No.8B is attracted for which reason petitioners have been disallowed from taking part. A wrong mentioning of clause will not in our opinion alter the situation particularly when the circumstance under which petitioners are not being permitted to participate is clearly visible from clause B8 and not B7. Said error has been clarified by the authority in its affidavit-in-reply. When two clauses are apparently read, it would be definitely clear that condition No.8B is clearly attracted and petitioners have been Page 31 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 debarred on account non supply of quoted drugs and therefore such hyper technical plea in the larger interest of public cannot be allowed to be given undue weightage To further elaborate on this aspect, we deem it proper to extract herein-below said 2 clauses which makes it clear that intent of these two clauses has to be seen. Condition No.7 and 8 under which a tenderer is prohibited from submitting are as under:-
"7.Bid should not be submitted for the product/products for which the concern/company stands blacklisted/banned/ debarred either by Bid inviting Authority or Govt. of Gujarat or its departments on any ground. The Bid should not be submitted for those products also for which the concern/company stands blacklisted/banned/debarred by any other State/Central Govt. or it's any agencies (central Drugs procurement agencies) on the ground of conviction by court of law or the products being found spurious or adulterated.
8.A) xxx B) The concerned company/firm/bidder who has been blacklisted/debarred by GMSCL or any other State/Central Government and its Drug Procurement Agencies due to failure in supply of Quality of Quoted drugs, shall not participate in the tender during the period of debarring /blacklisting If any product of company/firm/bidder were blacklisted/debarred at the time of bidding, for a specified Page 32 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 period, then the same will become eligible after blacklisting/debarring period is over. In case the period is not specified the debarment order, the firm shall be eligible to participate in bidding only after two year of the date of issue of the order of blacklisting/debarment. If any tenderer is debarred or black listed due to failure in supply of Quality of Quoted Drug during the tender validity or during the validity of the rate contract by any other State and central Government and its Drug Procurement Agencies, it is his (tender's) responsibility to inform such thing to the Managing Director, GMSCL."
[31] From reading of the aforesaid conditions, it would be quite clear that condition No.8B relates to failure in supply of quality of quoted drugs and when read conjointly with the debarment order dated 02.11.2021 (Annexure H) which is in respect of all drugs, it would be apparently clear that respondent authorities are justified in applying condition No.8B for disallowing the petitioners from participating any further. Hence, erroneous mentioning of a condition inadvertently cannot be allowed to be capitalized by the petitioners to get any equitable relief in such a serious contract of supply of medicines. Hence, the stand of the petitioners are not possible to be accepted.
Page 33 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 [32] At this stage, we may refer to the settled proposition of law laid down by Hon'ble Apex Court in the case of N. Mani versus Sangeetha Theatre and others reported in (2004) 12 SCC 278 and relevant observations contained in paragraph 9, we may deem it proper to reproduce hereunder:-
"9.It is well settled that if an authority has a power under the law merely because while exercising that power the source of power is not specifically referred to or a reference is made to a wrong provision of law, that by itself does not vitiate the exercise of power so long as the power does exist and can be traced to a source available in law."
[33] Hence we are of the clear opinion that stand of the petitioner is not possible to be accepted.
[34] Yet another reason for us not to extend any equitable relief in extraordinary jurisdiction vested in this Court in addition to aforementioned circumstances is that decision making process neither can be held mala fide nor it is arbitrary since reasons for rejection is : petitioner has been debarred at Government Medical Stores Deports for all drugs for 5 years Page 34 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 from 05.04.2021 as clearly emerging from order dated 02.11.2021 issued by Government of India and merely on account of mentioning a similar condition which relates to blacklisting is no ground for the petitioners to agitate and contend respondent authority is supplementing its reasons than what is assigned. In substance the reason is, petitioner is debarred for 5 years from supply of all drugs and this reason clearly attracts condition No.8B as noted hereinabove. Hence, we see no reason to ignore this basic fact for which petitioner us not allowed to further participate in tender process. When technicality is pitted against substantial justice, substantial justice must be given a predominance which is trite law propounded by series of decisions of Hon'ble Apex Court and as such when the main reason is clearly in tune with the language of condition No.8B, we have no hesitation in discarding the stand of petitioners that subsequently an attempt is made to alter the condition for ousting petitioner from tender process. [35] In fact at this stage, even the State authority was inclined to extend an opportunity to the petitioners for such clarification Page 35 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 but in a given situation like this, we see no reason to allow such stand even to operate, since consent does not confer jurisdiction or compel the Court to accept the said contention. In fact when a question of public health is to be taken care of by the State authority and State authority once adhere to zero tolerance in respect of quality medical drugs, we are not at all inclined to substitute the decision of respondent authority in any manner.
[36] At this stage, we may refer to the decision of Hon'ble Apex Court which has been relied by the learned Government Pleader in the case of Afcons Infrastructure Limited versus Nagpur Metro Rail Corporation Limited and another reported in (2016) 16 SCC 818 and the concept of judicial review in respect of tender matters, whereunder certain propositions have been indicated by Hon'ble Apex Court and we deem it proper to quote hereunder:-
"11. Recently, in Central Coalfields Ltd. v. SLL-SML (Joint Venture Consortium)[2] it was held by this Court, relying on a host of decisions that the decision making process of Page 36 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 the employer or owner of the project in accepting or rejecting the bid of a tenderer should not be interfered with. Interference is permissible only if the decision making process is mala fide or is intended to favour someone. Similarly, the decision should not be interfered with unless the decision is so arbitrary or irrational that the Court could say that the decision is one which no responsible authority acting reasonably and in accordance with law could have reached. In other words, the decision making process or the decision should be perverse and not merely faulty or incorrect or erroneous. No such extreme case was made out by GYT-TPL JV in the High Court or before us.
12. In Dwarkadas Marfatia and Sons v. Board of Trustees of the Port of Bombay[3] it was held that the constitutional Courts are concerned with the decision making process. Tata Cellular v. Union of India[4] went a step further and held that a decision if challenged (the decision having been arrived at through a valid process), the constitutional Courts can interfere if the decision is perverse. However, the constitutional Courts are expected to exercise restraint in interfering with the administrative decision and ought not to substitute its view for that of the administrative authority. This was confirmed in Jagdish Mandal v. State of Orissa[5] as mentioned in Central Coalfields.
13. In other words, a mere disagreement with the decision making process or the decision of the administrative authority is no reason for a constitutional Court to Page 37 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 interfere. The threshold of mala fides, intention to favour someone or arbitrariness, irrationality or perversity must be met before the constitutional Court interferes with the decision making process or the decision.
14. We must reiterate the words of caution that this Court has stated right from the time when Ramana Dayaram Shetty v. International Airport Authority of India[6] was decided almost 40 years ago, namely, that the words used in the tender documents cannot be ignored or treated as redundant or superfluous - they must be given meaning and their necessary significance. In this context, the use of the word 'metro' in Clause 4.2
(a) of Section III of the bid documents and its connotation in ordinary parlance cannot be overlooked.
15. We may add 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. The constitutional Courts must defer to this understanding and appreciation of the tender documents, unless there is mala fide 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 employer of a project 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."
[37] In addition to this, the decision of recent past rendered by Page 38 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 Hon'ble Apex Court in the case of N.G.Projects Limited versus Vinod Kumar Jain and Others reported in (2022) 6 SCC 127 would be useful to be referred whereunder the Hon'ble Apex Court has propounded the scope of interference in exercise of extraordinary jurisdiction in respect of tender matters. It reads:
"12. In Afcons Infrastructure Limited v. Nagpur Metro Rail Corporation Limited & Anr.5, this Court held 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. It was held as under:
"13. In other words, a mere disagreement with the decision-making process or the decision of the administrative authority is no reason for a constitutional court to interfere. The threshold of mala fides, intention to favour someone or arbitrariness, irrationality or perversity must be met before the constitutional court interferes with the decision-making process or the decision.
15. We may add 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. The constitutional courts must defer to this understanding and appreciation of the tender documents, unless there is mala fide 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 employer of a project 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."Page 39 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022
C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022
13. This Court sounded a word of caution in another judgment reported as Silppi Constructions Contractors v. Union of India and Ors.6, wherein it was held that the Courts must realize their limitations and the havoc which needless interference in commercial matters could cause. In contracts involving technical issues, the Courts should be even more 5 (2016) 16 SCC 818 6 2019 SCC OnLine SC 1133 reluctant because most of us in judges' robes do not have the necessary expertise to adjudicate upon technical issues beyond our domain. As laid down in the judgments cited above, 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. Courts must also not interfere where such interference would cause unnecessary loss to the public exchequer. It was held as under:-
"19. This Court being the guardian of fundamental rights is duty bound to interfere when there is arbitrariness, irrationality, mala fides and bias. However, this Court in all the aforesaid decisions has cautioned time and again that courts should exercise a lot of restraint while exercising their powers of judicial review in contractual or commercial matters. This Court is normally loathe to interfere in contractual matters unless a clear-cut case of arbitrariness or mala fides or bias or irrationality is made out. One must remember that today many public sector undertakings compete with the private industry. The contracts entered into between private parties are not subject to scrutiny under writ jurisdiction. No doubt, the bodies which are State within the meaning of Article 12 of the Constitution are bound to act fairly and are amenable to the writ jurisdiction of superior courts, but this discretionary power must be exercised with a great deal of restraint and caution. The Courts must realize their limitations and the havoc which needless interference in commercial matters can cause. In contracts involving technical issues the courts should be even more reluctant Page 40 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 because most of us in judges' robes do not have the necessary expertise to adjudicate upon technical issues beyond our domain. As laid down in the judgments cited above 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. Courts must also not interfere where such interference will cause unnecessary loss to the public exchequer.
20. The essence of the law laid down in the judgments referred to above is the exercise of restraint and caution; the need for overwhelming public interest to justify judicial intervention in matters of contract involving the state instrumentalities; the courts should give way to the opinion of the experts unless the decision is totally arbitrary or unreasonable; the court does not sit like a court of appeal over the appropriate authority; the court must realize that the authority floating the tender is the best judge of its requirements and, therefore, the court's interference should be minimal. 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, irrationality, bias, mala fides or perversity. With this approach in mind, we shall deal with the present case."
(Emphasis supplied) "22. The satisfaction whether a bidder satisfies the tender condition is primarily upon the authority inviting the bids. Such authority is aware of expectations from the tenderers while evaluating the consequences of non-performance. In the tender in question, there were 15 bidders. Bids of 13 tenderers were found to be unresponsive i.e., not satisfying the tender conditions. The writ petitioner was one of them. It is not the case of the writ petitioner that action of the Technical Evaluation Committee was actuated by extraneous considerations or was malafide. Therefore, on the same set of facts, different conclusions can be arrived at in a bona-fide manner by the Technical Page 41 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 Evaluation Committee. Since the view of the Technical Evaluation Committee was not to the liking of the writ petitioner, such decision does not warrant for interference in a grant of contract to a successful bidder.
23. In view of the above judgments of this Court, 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 tenderer. The Court does not have the expertise to examine the terms and conditions of the present-day economic activities of the State and this limitation should be kept in view. Courts should be even more reluctant in interfering with contracts involving technical issues as there is a requirement of the necessary ex-pertise to adjudicate upon such issues. The approach of the Court should be not to find fault with magnifying glass in its hands, rather the Court should 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 total arbitrariness or that the tender has been granted in a malafide manner, still the Court should refrain from interfering in the grant of tender but instead 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 costs on the State and is also against public interest. Therefore, the State and its citizens suffer twice, firstly by paying escalation costs and secondly, by being deprived of the infrastructure for which the present- day Governments are expected to work.
Page 42 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022
26. A word of caution ought to be mentioned herein that 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 larger public good. The grant of interim injunction by the learned Single Bench of the High Court has helped no-one except a contractor who lost a contract bid and has only caused loss to the State with no corresponding gain to anyone."
[38] From the aforesaid authoritative principles laid down by the Hon'ble Apex Court, it is indicative of the fact that the authority inviting the bids is to be primarily satisfied that the bidder satisfies the tender condition. The Courts would not sit in the armchair of the tender inviting authority to evaluate the decision so arrived at by authority inviting the bids. If the decision making process is flawed, this Court in exercise of extraordinary jurisdiction would interfere. However, if the decision is flawed, the interference is not called for in tender matters. In the instant case, the State on the ground of Zero Tolerance Policy has resolved to reject the bid of the petitioner on the ground of petitioner having been blacklisted. As to why the State should adopt Zero Tolerance Policy cannot be subject to judicial scrutiny when the State is asserting that the health of the general public is of paramount importance and there cannot Page 43 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 be any compromise in the quality of tablets or drugs being administered to the general public and in this process if it arrives at a conclusion that on account of petitioner having been blacklisted, it would still refuse to accept the bid of the petitioner though it is L1, on the ground of financial gain to the State, such offer from the petitioner cannot be accepted that too at the cost of the common man. Mere acceptance of the bid of the petitioner earlier would not justify the illegality being perpetrated. Hence, we are of the considered view that petitioner has not made out any case calling for interference. [39] Under the aforementioned circumstances, we are of the view that judgments relied upon by Mr. Shalin Mehta, learned senior counsel appearing for the petitioners would not come to his rescue and apparently not attracted or of any assistance to the petitioners' stand for the simple reason that background of facts is altogether different then what is prevailing on hand and we have discussed already the applicability of the relevant condition which is literally and meaningfully it is applied to the case on hand.
Page 44 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 [40] One of the decision of this Bench which has been tried to be pressed in aid of the prayer sought for in the application is the decision delivered on 05.04.2022 in Special Civil Application No.20161 of 2021. A bare reading of facts of said case itself would make it clear that same would not be applicable to the case of the petitioners particularly when in the first stage of bid process petitioners' case was considered and in the second stage without extending any opportunity was not considered and in that context, observations came to be made by this Court and as such the said judgment would also not be of any assistance to the petitioners. Even otherwise the law on precedent is quite clear and well settled that if the facts are different even one additional fact would make a world of difference in applying the precedent and as such, we are of the clear opinion that judgment cited by the learned senior counsel appearing for the petitioners is of no assistance in the background of present fact situation prevailing on record. Hence, we are of the view that no case is made out by the petitioners.
Page 45 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022 C/SCA/20436/2022 CAV JUDGMENT DATED: 21/10/2022 [41] Accordingly, petition is dismissed as devoid of merits with no order as to costs.
(ARAVIND KUMAR,CJ) (ASHUTOSH J. SHASTRI, J) DHARMENDRA KUMAR Page 46 of 46 Downloaded on : Sat Oct 22 20:19:29 IST 2022