Karnataka High Court
Astrix Technologies Pvt Ltd vs The State Project Director on 8 February, 2013
Author: Mohan Shantanagoudar
Bench: Mohan .M. Shantanagoudar
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IN THE HIGH COURT OF KARNATAKA AT BANGALORE
DATED THIS THE 8TH DAY OF FEBRUARY 2013
BEFORE
THE HON'BLE MR.JUSTICE MOHAN .M. SHANTANAGOUDAR
W.P.NO.506 OF 2013 (GM-TEN)
BETWEEN:
ASTRIX TECHNOLOGIES PVT LTD.,
REPRESENTED BY ITS MANAGING
DIRECTOR SRI. R. SHANKAR
100/E, 16TH MAIN
1ST FLOOR, VIJAYNAGAR
BANGALORE-40.
... PETITIONER
(By Sri:B.G. SRIDHARAN, SR. ADV,. FOR
A.C. BALARAJ, )
AND
1. THE STATE PROJECT DIRECTOR
RASHTRIYAMADHYAMIKSHIKSHAABHIYAN
NEW PUBLIC OFFICES ANNEX BUILDING
NRUPATHUNGA ROAD
KR CIRCLE
BANGALORE-560 001.
2. M/S. ASIAN SECURITY AND PERSONNEL
ARRANGEMENTS
REPRESENTED BY ITS PROPRIETOR
SRI SHANMUKHAGULLAPPABENDIGERI
D-15, LAKSHMI COMPLEX
COURT CIRCLE,
HUBLI-580 029.
3. THE SECRETARY
PRIMARY AND SECONDARY EDUCATION
2
GOVERNMENT OF KARNATAKA
MS BUILDING
BANGALORE-560 001.
... RESPONDENTS
( BY SRI P.S. DINESH KUMAR, ADV., FOR R1
B.S MURALI, ADV,. FOR R2)
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THIS WRIT PETITION IS FILED UNDER ARTICLE 226
AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO
QUASH THE ORDER OF THE RESPONDENT NO.1 DATED
24.12.2012 VIDE ANNEXURE-K.
THIS WRIT PETITION COMING ON FOR ORDERS THIS
DAY, THE COURT MADE THE FOLLOWING:-
ORDER
The petitioner has sought for quashing the order Annexure-K dated 24.12.2012, passed by first respondent, by which, the second respondent's tender is accepted and it is assigned work. A direction is also sought in this writ petition to the first respondent to award contract in favour of the petitioner, who is the successful bidder('H1' bidder).
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2. The first respondent issued tender notification as per Annexure-A dated 3.9.2012 calling for tenders to provide services of Human resources of Lab attendants and office assistants; The bidder would be declared as successful(H1) if he secures highest score as per QCBS(Quality and Cost Based Selection). The petitioner, respondent No.2 and two others participated in the tender process. The tender notification reveals that the tender will be evaluated on two scores i.e., technical evaluation and financial evaluation. The petitioner as well as respondent No.2 were held to be technically qualified, whereas other two tenderers did not technically qualify. In financial evaluation, second respondent had quoted lesser amount than the petitioner and that therefore 4 respondent No.2 was selected as successful bidder and he was assigned work as per the impugned order.
3. Sri. B.G. Sridharan, learned Senior counsel appearing on behalf of the petitioner submits that successful bidder would be selected as per the Quality & Cost Based Selection and that the combined score in respect of financial evaluation and technical evaluation will be considered for the purpose of conclusion; since the petitioner has scored 76.13% (combined score of technical evaluation and financial evaluation) and as the 2nd respondent has scored only 63.9%, the petitioner ought to have been selected; He further draws the attention of the Court to clause 7 of the tender notification regarding financial proposal which 5 says that financial proposal will be the total contract value of human resource services for the entire contract period as per the Appendix-I. The financial proposal shall be inclusive of all duties and all types of taxes as applicable under the statutory obligations. Thus according to him, the financial proposal quoted should include all types of duties and all types of taxes as applicable under the statutory obligations. In other words, the total amount quoted by each tenderer should be the basis to consider the financial proposal and not in respect of only one head relating to service charge.
4. Sri. P.S. Dinesh Kumar, learned counsel for respondent No.1 opposes the writ petition by filing statement of objections. In page 5 of the statement of objections, respondent No.1 has 6 given comparative table in respect of amounts quoted by the petitioner as well as respondent No.2. He also admits that the petitioner has scored 71.22% of marks in technical evaluation and whereas respondent No.2 has scored 51.87% of marks in technical evaluation. He further admits that the financial score of the petitioner is 90.91% and whereas, the financial score of respondent No.2 is 100%. These facts are not in dispute. However according to Sri. Dinesh Kumar, learned counsel nine components are taken into consideration by respondent No.1 while evaluating the tenders under the head 'financial evaluation'. Out of such nine components, component No.8 relates to service charge including of all taxes. He further submits that all other components 7 quoted by both the parties are almost similar, but the component in respect of service charge varies to a greater extent, inasmuch as, the petitioner has quoted `2063 as service charge including of all taxes in respect of each of the employee and whereas respondent No.2 has quoted service charge to an extent of `1209.50 paise in respect of each employee. Thus according to him, even if the tender work is assigned in favour of the petitioner, the petitioner would get higher service charge and consequently, neither the employees/teachers nor the State would be benefitted.
5. Sri. B.S. Murali, learned counsel for respondent No.2 brings to the notice of the Court that already 500 lab attendants and office assistants are appointed and they are assigned 8 respective schools for working and because of the interim order granted by this Court, remaining 100 employees though are selected are not given appointment.
Said submission is however disputed by the petitioner's counsel.
6. Having heard learned counsel on both the sides, the Court is of the opinion that the petitioner's counsel is justified in arguing that respondent No.1 was not correct in taking into consideration the component relating only to service charge inclusive of all taxes as the basis for financial evaluation, and that the first respondent should have taken the total contract value of Human Resource service for the entire contract period and that the financial proposal 9 shall be inclusive of all types of duties and all types of taxes etc., Tender document(clause 7) reads thus:-
7. The 'Financial Proposal' should include the following.
The financial proposal will be the total contract value of the human resources services for the entire contract period as per Appendix-I. The financial proposal shall be inclusive of all duties, and all types of taxes etc., as applicable under the statutory obligations."
7. From the above, it is clear that respondent No.1 is bound to take all the components into consideration while considering the financial proposal. It is not open for the first respondent to take into consideration only the component of service charge while evaluating the 10 financial bids. In addition, as aforementioned, the petitioner's quality was higher than the respondent No.2's quality, inasmuch as, petitioner has scored 71.22% marks in technical evaluation, whereas respondent No.2 has scored 51.87% of marks.
8. Thus in the normal course, this Court would have quashed the impugned order. However, having regard to the fact that 500 employees are already appointed and they have joined the services as per the documents produced by the counsel for respondent No.2 before this Court including copies of the appointment order and having regard to the fact that there is much difference in the rates quoted by the petitioner and respondent No.2 in respect of service charges(amount quoted in respect of 11 other components being similar), this Court proposes not to interfere in the impugned order. As could be seen from the financial evaluation table, as mentioned in the statement of objections, the amounts quoted by both the tenderers in respect to gross compensation, employees share, net take home compensation, employer share in ESI, are almost same. The difference is only of about 50 paise in respect of those components. But the component relating to service charge including of all taxes makes all the difference. The petitioner has quoted service charge inclusive of all taxes at `2063, whereas, respondent No.2 has quoted `1029.50 paise, which means that if the petitioner performs the work assigned to it, it would get `2063 as service charge (in other words commission), whereas 12 respondent No.2 would get 1029.50 paise as service charge(commission). The rates quoted in respect of other components as aforementioned are similar. The rates quoted by both the parties clearly go to show that net take home salary for each appointee is `6877/-. Even if the contention of the petitioner is accepted, then the petitioner would be benefitted and the State would be at loss and in the process, the employees appointed are not benefitted. Ultimately, it is for the State to take decision based on the financial feasibility also. The respondent No.1 having found that the service charge quoted by the petitioner is on the higher side and that there will be lot of financial burden by the said process on the State, has decided not to allot work in favour of the petitioner. 13
9. It is by now settled that mere making out a legal point in writ proceedings would not be sufficient to pass orders in favour of petitioner. It is relevant to note certain observations of Supreme Court in that regard in the case of AIR INDIA LTD., VS. COCHIN INTERNATIONAL AIRPORT LTD., AND OTHERS reported in (2000) 2 SCC 617, wherein it is held as follows:-
"The award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision considerations which are paramount are commercial considerations. The state can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. It can enter into negotiations before finally deciding to 14 accept one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to be the highest or the lowest.
But the State, its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot adhere from them arbitrarily. Though that decision is not amenable to judicial review, the court can examine the decision-making process and interfere if it is found vitiated by mala fides, unreasonableness and arbitrariness. The State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision- making process the court must exercise its discretionary power under Article 226 with great caution and should exercise it only in 15 furtherance of public interest and not merely on the making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should intervene."
Since this Court finds that the action taken by respondent No.1 is just and proper, no interference is called for. Petition fails and the same stands dismissed.
Sd/-
JUDGE *mn/-