Jharkhand High Court
Mandeepa Enterprises vs The State Of Jharkhand Through The ... on 2 August, 2018
Author: Rajesh Shankar
Bench: Rajesh Shankar
1
IN THE HIGH COURT OF JHARKHAND AT RANCHI
W.P.(C) No. 986 of 2018
Mandeepa Enterprises, having its office at G-1, Tulip Garden
Dasodrone, Rajarhat opp. SBI Bank, Kolkata, through its Operations
Manager Shri Mahesh Naik, son of Annu Naik, aged about 38 years,
resident of Unit G-1, Tulip Garden, Dasodrone, Rajarhat Main Road,
opp. SBI Bank, Kolkata (West Bengal) ... ... Petitioner
Versus
1. The State of Jharkhand through the Secretary, Road Construction
Department, Ranchi
2. The Engineer-in-Chief, Road Construction Department, Ranchi
3. The Chairman, Departmental Tender Committee-cum-Engineer-in-
Chief, Road Construction Department, Ranchi
4. The Executive Engineer, Road Construction Department, Road
Division, Chaibasa, West Singhbhum ... ... Respondents
With
W.P.(C) No. 888 of 2018
Mandeepa Enterprises, having its office at G-1, Tulip Garden
Dasodrone, Rajarhat opp. SBI Bank, Kolkata, through its Operations
Manager Shri Mahesh Naik, son of Annu Naik, aged about 38 years,
resident of Unit G-1, Tulip Garden, Dasodrone, Rajarhat Main Road,
opp. SBI Bank, Kolkata (West Bengal) ... ... Petitioner
Versus
1. The State of Jharkhand through the Secretary, Road Construction
Department, Ranchi
2. The Engineer-in-Chief, Road Construction Department, Ranchi
3. The Chairman, Departmental Tender Committee-cum-Engineer-in-
Chief, Road Construction Department, Ranchi
4. The Executive Engineer, Road Construction Department, Road
Division, Saraikella-Kharsawan ... ... Respondents
CORAM: HON'BLE MR. JUSTICE RAJESH SHANKAR
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For the Petitioner : Mr. Anil Kumar Sinha, Sr. Advocate Mrs. Sweety Topno, Advocate For the Respondent-State : Mr. Ajit Kumar, AG Mrs. Aprajita Bhardwaj, AC to AG
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Order No. 12 Dated: 02.08.2018 W.P.(C) No. 986 of 2018 has been filed for quashing the Re-e Tender (3rd call) Reference No. RCD/CHAIBASA/173 dated 15.02.2018 issued by respondent no. 4 - the Executive Engineer, Road Construction Department, Road Division, Chaibasa, West Singhbhum and further for direction upon the respondents to issue Letter of Award (LoA) to the petitioner as he has been found suitable twice by the Tender Committee.
22. W.P.(C) No. 888 of 2018 has been filed for quashing the Tender Notice dated 12.02.2018 being Tender Reference No. RCD/Saraikella/188 issued by the respondent no. 4 - the Executive Engineer, Road Construction Department, Road Division, Saraikella- Kharsawan and further for issuance of direction upon the respondents to issue a Letter of Award (LoA) to the petitioner.
3. During the pendency of the writ petition, by way of interlocutory applications, the petitioner also sought to challenge the decision of the tender committee dated 08.02.2018, whereby the recommendation was made for rejecting the bid of the petitioner. The interlocutory applications filed in both the writ petitions were disposed of vide order dated 19.07.2018 observing that the amendment sought by the petitioner shall be treated as the part of the original writ petitions.
4. The factual background of the case as stated in the writ petition is that the respondents for the purpose of selection of bidder for collection of user fee through fee collecting agency on the basis of competitive bidding through e-Tender at km 13+400 at Sangajata Toll Plaza for the section from km 0.00 to km 47.86 (Chaibasa-Kandra Road Section) of State Highways No. 5 in the State of Jharkhand, invited e-Tender No. RCD/CHAIBASA/1138/2017-18 (2nd Call). The petitioner participated in the tender and the Tender Inviting Committee found his technical bid as responsive and thereafter his financial bid was also opened, however, no decision was taken. Thereafter, the petitioner filed several representations to the respondent authorities, but all went in vein. The petitioner received the Tender Summary Reports through Internet on 12.02.2018 which reflected that the bid/tender of the petitioner was found financially responsive. However on 15.02.2018, the petitioner came to know that the Executive Engineer, Road Construction Department, Road Division, Chaibasa again issued the Tender being Re-e-Tender (3rd Call) Reference No. RCD/CHAIBASA/173 dated 15.02.2018 for the same work which gives rise to the filing of present writ petition.
5. The learned Senior Counsel for the petitioner submits that 3 the petitioner should not be deprived of allotment of the work when both the financial and technical bids have been found responsive. It is further submitted that M/s Mandeepa Enterprises is the sole proprietary concern of Mr. Madan Satya Das and as such, Mandeepa Enterprises has no separate identity under law. It is further submitted that the respondents have not given any opportunity of hearing to the petitioner before rejecting his bid and thus, the impugned orders also violate the principles of natural justice. It is further submitted that the solvency certificate has been issued by the petitioner's bank in the standard format meant for the said purpose and thus, the same should not have been rejected.
6. Per contra, the learned Advocate-General appearing on behalf of the respondents submits that on the basis of the complaint submitted by one HSM Holding Pvt. Ltd., the bid documents of the petitioner were re-examined and it was found that there was a difference in net worth certificate and the balance sheet submitted by the petitioner. The petitioner had submitted the certificate for the net worth of Rs.1.65 crores, but in the balance sheet submitted by it, net worth was found as 1.018 crores. It was also found that the solvency certificate issued by the Syndicate Bank was a conditional one, wherein it was mentioned that the bank would not take any responsibility and guarantee. It is further submitted that after having found the aforesaid infirmities in the tender documents of the petitioner, the tender committee decided to reject the bid of the petitioner and subsequently a fresh tender was published.
7. Heard the learned counsel for the parties and perused the materials available on record. The bids of the petitioner were rejected for two reasons; firstly, there was difference in the net worth certificate and the balance sheet submitted by the petitioner and secondly, the solvency certificate issued by the Syndicate Bank was a conditional one.
8. On perusal of the record, it appears that initially both the bids of the petitioner were found responsive and only on the complaint of one HSM Holding Pvt. Ltd., the respondents decided to 4 revisit the tender documents of the petitioner. The thrust of the argument of the learned Senior Counsel for the petitioner is that if the respondents on re-examining the tender documents of the petitioner purportedly found certain infirmities in the same, it was incumbent on the part of the respondents to issue notice to the petitioner seeking appropriate clarification in that regard, however, the respondents arbitrarily rejected the bids of the petitioner without issuing any notice to him.
9. The learned Advocate-General appearing for the respondents has put strong reliance on Clause 2.5.2 of the bid documents and has submitted that it was specifically provided therein that in case of Partnership firm/Proprietary firm, the net worth of the firm and not of the individual partners shall be considered. In case of individuals, the capacity of the individual for the applicable financial year shall be considered on the basis of valuation certificate from the registered valuer and certification of the same by the Chartered Accountant.
10. It is, however, contended on behalf of the petitioner that the respondents have misconstrued the entity of the petitioner as a firm, rather it is a proprietary concern, thus the petitioner should be treated as an individual. In support of his contention, the learned Senior Counsel for the petitioner has put reliance on the judgment of the Hon'ble Supreme Court rendered in the case of "Ashok Transport Agency Vs. Awadhesh Kumar & Anr." reported in (1998) 5 SCC 567. I have perused the said judgment, wherein the Hon'ble Supreme Court has held that a partnership firm differs from a proprietary concern owned by an individual. A proprietary concern is only the business name in which the proprietor of the business carries on the business. In the event of death of a proprietor of a proprietary concern, it is the legal representative of a proprietor who alone can sue or be sued in respect of the dealings of the proprietary business.
11. Thus, I am of the considered view that in the given facts and circumstances, the petitioner was required to be afforded sufficient opportunity to explain/clarify the issues which arose on 5 re-examination of the tender documents, more so when initially the bids of the petitioner were found responsive and subsequently on the application of a stranger (as it was not the participant in the tender in question), the respondents decided to re-examine the documents of the petitioner. Rejection of bid on the ground that the petitioner fell short of the requirement of the terms and conditions of the tender is one aspect, however, if on acceptance of the bids, it was subsequently decided to take any contrary view, then the principles of natural justice comes into play and it was required by the respondent authorities to provide proper opportunity of hearing to the petitioner to clarify the doubts.
12. Concept of natural justice has undergone a great deal of change in recent years. These may be implied from the nature of the duty to be performed by the authorities under a statute. What particular rule of natural justice should be implied and what should be its context in a given case must depend to a great extent on the fact and circumstances of that case within the frame-work of law under which the enquiry is held. Even an administrative order which involves adverse civil consequences must be consistent with the rules of natural justice.
13. So far the objection of the respondents with regard to the solvency certificate submitted by the petitioner is concerned, I have perused the judgment of Andhra Pradesh High Court rendered in the case of "Sree Sairam Enterprises Vs. Government of A.P & Ors." reported in 2004 (2) ALD 494, wherein it has been held as under:
10. The solvency of an individual or agency indicates his or its financial capacity. Whenever transactions are contemplated with such persons or agencies, the contracting party prefers to take into account such capability. In this process, instead of relying upon the self-serving statements of the persons or agencies, certifications are required to be furnished by certain known authorities or organizations. Irrespective of the circumstances under which these certifications are required, except certifying the financial capability of the person, the certifying agencies do not undertake any liability, either direct, or vicarious on behalf of such persons and agencies. Certification by itself, cannot be treated as indemnity or guarantee. By no 6 stretch of imagination, the certification of solvency can be equated with such legal concepts.
14. The petitioner has also brought on record the form/format of Solvency Certificate which is generally issued by the Nationalized/ Scheduled Banks which contains the rider that the Solvency Certificate is issued without any guarantee or responsibility of the Bank or any of its officers. I am in agreement with the view taken by the Andhra Pradesh High Court on this issue. The solvency certificate is issued with regard to the financial capacity of any person considering his past conduct/transaction with the issuing Bank. The certifying officer does not undertake any liability on behalf of the person in whose favour the solvency certificate is issued. Thus, the objection of the respondents with respect to the content in the solvency certificate filed by the petitioner is not tenable.
15. It appears from the record that during the pendency of the writ petition, the technical bid of the petitioner in 3rd Call has been rejected by Tender Committee on the ground that while issuing the solvency certificate, the bank has not taken any kind of responsibility and guarantee. Thereafter, the Executive Engineer, Road Construction Department, Road Division, Seraikella-Kharsawan has invited e-Tender for the 4th Call vide short term e-Tender Reference No. RCD/SERAIKELLA/712 dated 14.06.2018. Due to the said subsequent development, the petitioner's prayer for quashing of tender notice dated 12.02.2018 and Re-e Tender (3rd Call) Reference No. RCD/CHAIBASA/173 dated 15.02.2018 has become infructuous.
16. Under the aforesaid circumstance, the decision of the Tender Committee dated 08.02.2018 with regard to the rejection of bid of the petitioner is quashed. The matter is remanded to the Tender Committee to provide an opportunity of hearing to the petitioner/his representative to explain/clarify the issues which were earlier considered by the said Committee, as impugned in the present writ petition. The fresh decision taken by the Tender Committee shall be placed before the Secretary, Department of Road Construction, Government of Jharkhand. Till the final decision is taken in this regard by the Secretary, the respondents shall not proceed further with the 7 subsequent tender i.e., the Notice Inviting e-Tender for the 4th Call vide e-Tender Reference No. RCD/SERAIKELLA/712 dated 14.06.2018.
17. The writ petition is accordingly disposed of.
(Rajesh Shankar, J.) Manish/A.F.R.