Himachal Pradesh High Court
M/S Chamunda Construction Company vs State Of Himachal Pradesh And Others on 28 September, 2020
Bench: Tarlok Singh Chauhan, Jyotsna Rewal Dua
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA CWP No. 3583 of 2020.
.
Judgment reserved on: 23.09.2020.
Date of decision: 28.09.2020.
M/s Chamunda Construction Company .....Petitioner.
Versus State of Himachal Pradesh and others .....Respondents.
Coram The Hon'ble Mr. Justice Tarlok Singh Chauhan, Judge.
The Hon'ble Ms. Justice Jyotsna Rewal Dua, Judge.
Whether approved for reporting?1 Yes For the Petitioner : Mr. B.C. Negi, Senior Advocate with Mr. Nitin Thakur, Advocate.
For the Respondents: Mr. Ashok Sharma, Advocate
General with Mr. Vikas
Rathore, Mr. Vinod Thakur,
Mr. Shiv Pal Manhans,
Additional Advocate
Generals, Ms. Seema
Sharma, Mr. Bhupinder
Thakur and Mr. Yudhbir
Thakur, Deputy Advocate
Generals, for respondents
No.1 to 5/State.
(Through Video Conferencing)
1
Whether the reporters of the local papers may be allowed to see the Judgment?Yes ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 2 Tarlok Singh Chauhan, Judge The petitioner has sought quashing of the entire .
tender work of Neugal Khad along Sourav Ban Vihar in Tehsil Palampur, District Kangra, H.P. regarding construction of retaining walls, wire crate works, stacking works and dredging works and has further sought quashing of the action of the respondents in rejecting the claim of the petitioner at the technical bid stage.
r In addition thereto, the petitioner has also sought quashing of the letter dated 29.08.2020, whereby the petitioner has been held to be a non-participating firm.
2. Respondent No.5 i.e. Executive Engineer, Jal Shakti Division, Palampur, on behalf of the Government of Himachal Pradesh, invited item rate bids for the aforesaid works. In all six number of bidders/firms/contractors including the petitioner firm participated in the e-tender process dated 03.08.2020.
3. The technical bid was opened online on 17.08.2020 by respondent No.5, who referred the same for further scrutiny by an Evaluation Committee at Jal Shakti Circle Dharamshala for further examination.
::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 34. The Superintendent Engineer after examining the case referred it for further examination at Zonal Office .
by a technical Committee by respondent No.3, which found that the petitioner firm/contractor and another contractor/firm 'M/s Gagan Kumar Ohri' were not eligible as both did not fulfill the eligibility criteria that was stipulated in the Notice Inviting Tender (NIT).
5. Accordingly, respondent No.3 i.e. Chief Engineer, Dharamshala Zone referred the matter for further clarification to respondent No.2, who observed that the petitioner firm/contractor did not fulfill the eligibility criteria as the work done certificate relied upon by the petitioner firm/contractor was not of the participating firm, which meant that the petitioner firm/contractor consists of three partners viz; Sh. Pankaj Sharma, S/o Sh. Som Raj, R/o VPO Indora, Tehsil Indora, District Kangra, H.P.; Sh. Mohinder Sharma, S/o Sh. Ram Lal, R/o VPO Damtal, Tehsil Indora, District Kangra, H.P. and Sh. Naresh Padiyal, S/o late Sh. Bal Krishan, R/o Village Sheela Chowk, P.O. Sidhpur, Tehsil Dharamshala, District Kangra, H.P., each having share to the extent of 40%, 40% and 20%, respectively and the work experience furnished is of Naresh Padiyal, whose share is ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 4 only to the extent of 20%. Therefore, the participating firm i.e. the petitioner firm/contractor did not fulfill the criteria of .
having work experience of 50% of the estimated cost.
Moreover, the similar work stipulated in the NIT was of 'Wire Crate Work in Flood Protection Works', whereas, the petitioner firm /contractor partner, namely, Sh. Naresh Padiyal had furnished the work experience of construction of Science Block/Buildings which were altogether different from the required 'Flood Protection Works' as stipulated in the NIT. Therefore, the petitioner firm/contractor was held ineligible and further process was undertaken to complete the codal formalities for final awarding the work in favour of the Lowest-1.
6. As per 'NIT', the definition of similar work as set out in the uploaded tender documents is as under:
"(a) Experience on similar works executed during the last seven years and details like monetary value, clients proof of satisfactory completion should be furnished before purchase of tender documents. The eligibility criteria are: Satisfactorily completed as prime contractor similar nature work, (similar nature means firm must have completed wire crate work in flood protection works and concrete work separately or together in a work ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 5 of following financial values) at least as under:
1. The bidder must have completed three similar .
works costing each not less than 40% of the given estimated cost for which the bid is invited which instant case is Rs.2,39,54,758(minimum value).
Or
2. The bidder must have completed two similar works costing each not less than 50% of the given estimated cost for which the bid is invited which instant case is Rs.2,99,43,447.
Or
3. The bidder must have completed one similar works costing not less than 80% of the given estimated cost for which th bid is invited which instant case is Rs.4,79,09,515.
Note:- Work shall be considered completed if it is executed 90% either awarded physical quantity or financial value."
7. The petitioner firm submitted three numbers work done certificates, which are detailed as under:
S.No. Name of Name of Work Value and
Firm/ Remarks
Contractor
1. M/S Providing flood 38,20,393/-
Chamunda protection work to (less than
Construction Lunkhari Khad in Tehsil required
Company Bangana Distt. Una (HP) criteria of 40%
(Sub Head: C/o 455 or 50% or
mtrs. Long earthen 80%, as the
embankment including case may be)
wire crated apron,
pitching etc. from RD
::: Downloaded on - 28/09/2020 20:18:48 :::HCHP
6
5515 to RD 5960 on left
bank of Lunkhari Khad.
.
2. Naresh Construction of Science 3,56,46,575/-
Padiyal Block in Govt. Degree This work is of
College at Dharamshala, construction of
Tehsil Dharamshala, buildings and
Distt. Kangra, H.P. (Sub not of Wire
Head: Construction of Crate Work in
building i/c W/S &S/I Flood
and rain water Protection
harvesting system etc. Works.
Moreover, it is
less than the
90% of
completion
value against
awarded
r amount of
Rs.7.65 lacs,
therefore, it is
of on-going
works and not
of completed
works.
3. Naresh Construction of 4,51,03,436/-
Padiyal additional This work is of
accommodation for construction of
Judicial Court Complex buildings and
Block A&B at not of Wire in
Dharamshala,Tehsil Flood
Dharamshala, Distt. Protection
Kangra, H.P. (Sub Head: Works as per
Balance work of building NIT
portion i/c W/S &S/I and requirement.
rain water harvesting
etc.
8. The respondents found the value of the work was only Rs.38.20 lacs which did not constitute either 80% or 50% or 40% of the estimated cost put to tender in question i.e. Rs.2,39,20,000/-, and, therefore, the petitioner did not ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 7 fulfill the condition of NIT and his tender was accordingly rejected.
.
9. However, Shri B.C.Negi, Senior Advocate assisted by Shri Nitin Thakur, Advocate, for the petitioner, would contend that the act of the respondent-department in rejecting the claim of the petitioner at the technical evaluation for not submitting work of similar nature done of the firm is against the prevalent practice.
r In addition, he would argue that the respondent-department cannot adopt different yardsticks in judging thees works which depicts biasness and arbitrariness on the part of the respondent-
department.
10. On the other hand, the learned Advocate General would argue that the petition is not maintainable as the petitioner does not fulfill the eligibility criteria and was rightly kept out of consideration of the evaluation after the technical bids.
11. We have heard the learned counsel for the parties and gone through the records of the case.
12. The law relating to award of a contract by the State, its corporations and bodies acting as instrumentalities and agencies of the Government has been settled by the ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 8 decisions of the Hon'ble Supreme Court in R.D. Shetty vs. International Airport Authority (1979) 3 SCC 488, .
Fertilizer Corporation Kamgar Union vs. Union of India (1981) 1 SCC 568, Assistant Collector, Central Excise vs. Dunlop India Ltd. (1985) 1 SCC 260=1984 (2) SCALE 819, Tata Cellular vs. Union of India (1994) 6 SCC 651= 1995 (1) Arb. LR 193, Ramniklal N.Bhutta vs. State of Maharashtra (1997) 1 SCC 134= 1996 (8) SCALE 417 and Raunaq International Ltd. vs. I.V.R. Construction Ltd. (1999) 1 SCC 492=1999 (1) Arb. LR 431 (SC).
13. 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 consideration which are of 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 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 ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 9 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 depart 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 r by mala fides, unreasonableness and arbitrariness.
14. 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 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.
15. It is well settled that the Court should not ordinarily interfere in commercial activities under its power ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 10 of judicial review and reference in this regard can conveniently be made to a fairly recent judgment of the .
Hon'ble Supreme Court in Silppi Constructions Contractors vs. Union of India and another etc. etc. (2019) 11 Scale 592, wherein it was observed as under:
"6. Aggrieved, the original writ petitioner is before us in these petitions. This Court in a catena of judgments has laid down the principles with regard to judicial review in contractual matters. It is settled law that the writ courts should not easily interfere in commercial activities just because public sector undertakings or government agencies are involved.
7. In Tata Cellular vs. Union of India (1994) 6 SCC 651, it was held that judicial review of government contracts was permissible in order to prevent arbitrariness or favouritism. The principles enunciated in this case are :
"94. .......
(1) The modern trend points to judicial restraint in administrative action. (2) The Court does not sit as a court of appeal but merely reviews the manner in which the decision was made.
(3) The Court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible.::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 11
(4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of .
contract.
Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts.
(5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-
administrative sphere. However, the decision must not only be tested by the r application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides.
(6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure."
8. In Raunaq International Ltd. vs. I.V.R. Construction Ltd. (1999) 1 SCC 492, this Court held that superior courts should not interfere in matters of tenders unless substantial public interest was involved or the transaction was mala fide.
9. In Air India Limited vs. Cochin International Airport Ltd.(2000) 2 SCC 617, this Court once again stressed the need for overwhelming public interest to justify judicial intervention in contracts involving the State and its instrumentalities. It was held that Courts must proceed with great caution ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 12 while exercising their discretionary powers and should exercise these powers only in furtherance .
of public interest and not merely on making out a legal point.
10. In Karnataka SIIDC Ltd. vs. Cavalet India Ltd.
(2005) 4 SCC 456, it was held that while effective steps must be taken to realise the maximum amount, the High Court exercising its power under Article 226 of the Constitution is not competent to decide the correctness of the sale affected by the Corporation.
11. In Master Marine Services (P) Ltd. vs. Metcalfe & Hodgkinson (P) Ltd.(2005) 6 SCC 138, it was held that while exercising power of judicial review in respect of contracts, the Court should concern itself primarily with the question, whether there has been any infirmity in the decision making process. By way of judicial review, Court cannot examine details of terms of contract which have been entered into by public bodies or State.
12. In B.S.N. Joshi & Sons Ltd. vs. Nair Coal Services Ltd.(2006) 11 SCC 548, it was held that it is not always necessary that a contract be awarded to the lowest tenderer and it must be kept in mind that the employer is the best judge therefor; the same ordinarily being within its domain. Therefore, the court's interference in such matters should be minimal. The High Court's jurisdiction in such matters being limited, the Court should normally exercise judicial restraint ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 13 unless illegality or arbitrariness on the part of the employer is apparent on the face of the record.
.
13. In Jagdish Mandal vs. State of Orissa (2007) 14 SCC 517, it was held:
"22. Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and mala fides. Its purpose is to check whether choice or decision is made "lawfully" and not to check whether choice or decision is "sound". When the power of judicial review is invoked in matters relating to tenders or award of contracts, certain special features should be borne in mind. A contract is a commercial transaction. Evaluating tenders and awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona fide and is in public interest, courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review, should be resisted. Such interferences, either interim or final, may hold up public works for years, or delay relief and succour to thousands and millions and may increase the project cost manifold........"
14. In Michigan Rubber (India) Ltd. vs. State of Karnataka & Ors. (2012) 8 SCC 216, it was held ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 14 that if State or its instrumentalities acted reasonably, fairly and in public interest in .
awarding contract, interference by Court would be very restrictive since no person could claim fundamental right to carry on business with the Government. Therefore, the Courts would not normally interfere in policy decisions and in matters challenging award of contract by State or public authorities.
15. In Afcons Infrastructure Ltd. vs. Nagpur Metro Rail Corporation Ltd. (2016) 16 SCC 818, it was held that 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. 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 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.
::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 1516. In Montecarlo vs. NTPC Ltd. AIR 2016 SC 4946, it was held that where a decision is taken that is .
manifestly in consonance with the language of the tender document or subserves the purpose for which the tender is floated, the court should follow the principle of restraint. Technical evaluation or comparison by the court would be impermissible. The principle that is applied to scan and understand an ordinary instrument relatable to contract in other spheres has to be treated differently than interpreting and appreciating tender documents relating to technical works and projects requiring special skills. The owner should be allowed to carry out the purpose and there has to be allowance of free play in the joints.
17. In Municipal Corporation, Ujjain and Another vs. BVG India Ltd. and Others (2018) 5 SCC 462 , it was held that the authority concerned is in the best position to find out the best person or the best quotation depending on the work to be entrusted under the contract. The Court cannot compel the authority to choose such undeserving person/company to carry out the work. Poor quality of work or goods can lead to tremendous public hardship and substantial financial outlay either in correcting mistakes or in rectifying defects or even at times in redoing the entire work.
18. Most recently this Court in Caretel Infotech Limited vs. Hindustan Petroleum Corporation ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 16 Limited and Others (2019) 6 Scale 70 observed that a writ petition under Article 226 of the .
Constitution of India was maintainable only in view of government and public sector enterprises venturing into economic activities. This Court observed that there are various checks and balances to ensure fairness in procedure. It was observed that the window has been opened too wide as every small or big tender is challenged as a matter of routine which results in government and public sectors suffering when unnecessary, close scrutiny of minute details is done.
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 clearcut 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 ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 17 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 realise 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 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 realise that the authority floating the tender is the best judge of its requirements and, therefore, the court's ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 18 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."
16. Similar reiteration of law can be found in another recent judgment of the Hon'ble Supreme Court in M/s N. Ramachandra Reddy vs. State of Telangana and others, AIR 2019 SC 4182.
17. Bearing in mind the aforesaid exposition of law, we really do not find any infirmity much less an illegality in the action of the respondents in rejecting the case of the petitioner for not having requisite experience of executing similar works, as the combined value of the work of the petitioner is Rs.38.20 lacs as against the requirement of Rs.2,39,20,000/- and the same does not constitute either 80% or 50% or for that matter 40% of the estimated cost put to the tender in question.
::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 1918. Confronted with this, learned Senior counsel for the petitioner would argue that the respondents should have .
taken into consideration the other works of similar nature executed by one of its partner Naresh Padiyal as depicted at serial No. 2 and 3.
19. We have considered the submissions and are of the considered view that now that the respondents have evaluated similar contracts towards experience, it is not open for this Court to review the said order, especially, when the same is neither perverse, mala fide nor intended to favour one of the tenderers.
20. In drawing such conclusion, we are supported by the judgment of the Hon'ble Supreme Court in Afcons Infrastructure Ltd. vs. Nagpur Metro Rail Corporation Ltd., (2016) 16 SCC 818 at 825-26, para 4.2(a) of Section III of the tender conditions in support of certain similar contracts, as previous works experience. The question before the Hon'ble Supreme Court was whether an inter-state high speed railway project could be similar to metro civil construction work. After laying down the parameters of judicial review and referring to various judgments for the same, the Hon'ble Supreme Court held as under:
::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 20"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.
16. In the present appeals, although there does not appear to be any ambiguity or doubt about the interpretation given by NMRCL to the tender conditions, we are of the view that even if there was such an ambiguity or doubt, the High Court ought to have refrained from giving its own interpretation unless it had come to a clear conclusion that the interpretation given by NMRCL was perverse or mala fide or intended to favour one of the bidders. This was certainly not the case either before the High Court or before this Court.
21. In Montecarlo Ltd. vs. NTPC Ltd. (2016) 15 SCC 272 at 288, the Hon'ble Supreme Court referred to ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 21 various judgments including the judgment in Afcons Infrastructure Ltd.(supra) and concluded as follows:
.
"26. We respectfully concur with the aforesaid statement of law. We have reasons to do so. In the present scenario, tenders are floated and offers are invited for highly complex technical subjects. It requires understanding and appreciation of the nature of work and the purpose it is going to serve. It is common knowledge in the competitive commercial field that technical bids pursuant to the notice inviting tenders are scrutinized by the technical experts and sometimes third party assistance from those unconnected with the owner's organization is taken. This ensures objectivity. Bidder's expertise and technical capability and capacity must be assessed by the experts. In the matters of financial assessment, consultants are appointed. It is because to check and ascertain that technical ability and the financial feasibility have sanguinity and are workable and realistic. There is a multi-
prong complex approach; highly technical in nature. The tenders where public largesse is put to auction stand on a different compartment. Tender with which we are concerned, is not comparable to any scheme for allotment. This arena which we have referred requires technical expertise. Parameters applied are different. Its aim is to achieve high degree of perfection in execution and adherence to the time schedule.::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 22
But, that does not mean, these tenders will escape scrutiny of judicial review. Exercise of .
power of judicial review would be called for if the approach is arbitrary or malafide or procedure adopted is meant to favour one. The decision making process should clearly show that the said maladies are kept at bay. But where a decision is taken that is manifestly in consonance with the language of the tender document or subserves the purpose for which the tender is floated, the court should follow the principle of restraint. Technical evaluation or comparison by the court would be impermissible. The principle that is applied to scan and understand an ordinary instrument relatable to contract in other spheres has to be treated differently than interpreting and appreciating tender documents relating to technical works and projects requiring special skills. The owner should be allowed to carry out the purpose and there has to be allowance of free play in the joints."
22. Similar issue thereafter came up before the Hon'ble Supreme Court in Sam Built Well Private Limited vs. Deepak Builders and others, (2018) 2 SCC 176 wherein the Hon'ble Supreme Court after placing reliance on the aforesaid judgments observed as under:
"12.We have already noticed that three expert committees have scrutinized Respondent No.1's ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 23 tender and found Respondent No.1 to be ineligible. The impugned judgment of the Division .
Bench of the High Court expressly states that no malafides are involved in the present case. Equally, while setting aside the judgment of the learned Single Judge, the Division Bench does not state that the three expert committees have arrived at a perverse conclusion. To merely set aside the judgment of the learned Single Judge and then jump to the conclusion that Respondent No.1's tender was clearly eligible, would be directly contrary to the judgments aforestated.
Not having found malafides or perversity in the technical expert reports, the principle of judicial restraint kicks in, and any appreciation by the Court itself of technical evaluation, best left to technical experts, would be outside its ken. As a result, we find that the learned Single Judge was correct in his reliance on the three expert committee reports. The Division Bench, in setting aside the aforesaid judgment, has clearly gone outside the bounds of judicial review. We, therefore, set aside the judgment of the Division Bench and restore that of the learned Single Judge."
23. It is next contended by learned Senior Counsel for the petitioner that the respondents cannot adopt two different yardsticks while carrying out the technical evaluation. He in particular has invited our attention to the ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 24 proceedings of the meeting for opening of technical bids held on 16.01.2015 (Annexure P-9) regarding Swan River .
Flood Management Project from Daulatpur Bridge to Gagret Bridge in Main Swan River and all tributaries joining main Swan River from Daulatpur Bridge to Santokhgarh Bridge in Distt. Una (HP) (Phase-4th) (SH:- Construction of Earthen embankment including wire crated apron, stone pitching & RCC bod etc. from RD 31050/0 to 5000 on both sides of "Panjawar/Nagnoli Khad" on Right bank of Swan River (From RD 31050/0 to 2000 on both side of Khad) (For 1 st km & 2nd km).
24. It is argued that while evaluating these bids of the similar nature, the respondents awarded the work to M/s R.S. Constructions after holding its work of concrete lining of Rajpura Disty at District Fatehgarh Sahib satisfactory towards experience of having successfully completed similar works.
25. We have considered the argument and in absence of any particulars and records regarding the terms and conditions of the tender, the nature of the work etc. are not in a position to uphold the contention, but nonetheless, we can definitely observe that the respondents after specifically ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 25 and clearly laying down the terms and conditions should not and cannot deviate from the conditions. After-all, the .
respondents being a State cannot be permitted to say that "show me the face and I will show you the rule".
26. Learned Senior Counsel for the petitioner would then argue that since this substantial compliance with the tender conditions regarding experience and executing the work had been made, the claim of the petitioner should not have been rejected.
27. In support of such contention, reliance is placed by the learned Senior Counsel for the petitioner, on the judgment of the Hon'ble Supreme Court in B.S.N. Joshi & Sons Ltd. vs. Nair Coal Services Ltd. and others (2006) 11 SCC 548, more particularly, the observations made in paragraphs No. 8, 24, 28, 66(v) and 69 and another judgment of the Hon'ble Supreme Court in Tejas Constructions and Infrastructure Private Limited vs. Municipal Council, Sendhwa and another (2012) 6 SCC 464, more particularly, the observations made in paragraphs No. 27 to 31.
28. We have gone through these judgments and find that the same are not at all applicable to the facts of the ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 26 instant case. What has been laid in the aforesaid judgments is that when a decision is taken by the appropriate authority .
upon due consideration of the tender document submitted by the tenderers on their own merits and if it is ultimately found that the successful bidder had in fact substantially complied with the purport and object for which the essential conditions were laid down, the same may not ordinarily be interfered with.r
29. This is not the fact situation obtaining in the instant case because as against the requirement of the bidder having executed the similar works of at least Rs.2,39,20,000/-, the petitioner had only an experience of executing work only of Rs.38.20 lacs and could not, therefore, be said to have substantially complied with the conditions of the tender and thus his claim has rightly been rejected at the technical bid stage.
30. As a last ditch effort, learned Senior Counsel for the petitioner would argue that the correctness of the order passed by the respondents can be judged only on the basis of the reasons stated in the impugned order and not on the basis of the subsequent materials, much less on the basis of the affidavit filed before this Court.
::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 2731. Strong reliance in support of such contention is placed on the judgment rendered by a Constitutional Bench .
of the Hon'ble Supreme Court in Mohinder Singh Gill and another vs. The Chief Election Commissioner, New Delhi and others (1978) 1 SCC 405, wherein it was observed as under:
"8. The second equally relevant matter is that when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of affidavit or otherwise. Otherwise, an order bad in the beginning may, by the time it comes to Court on account of a challenge, get validated by additional grounds later brought out."....
32. It is not in dispute that one of the primary reasons for not considering the claim of the petitioner as per the rejection letter is that "Further, it has been found that M/S Chamunda Construction Company VPO &Tehsil Indora Distt. Kangra HP has uploaded work done certificates which are not of the participating firm". Whereas, now the claim of the petitioner is sought to be rejected on additional grounds as set out above.
::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 2833. Obviously, there can be no quarrel with the proposition as laid down by the Hon'ble Supreme Court in .
Mohinder Singh Gill's case (supra), but then it cannot be ignored that the petitioner is not eligible and cannot be awarded the work in question and the subsequent material to support the reason given by the respondents is in the larger public interest.
34. The Hon'ble Supreme Court in its subsequent judgment has clearly held that the propositions laid down in Mohinder Singh Gill's case (supra) are not applicable where larger public interest is involved and, in such circumstances, the additional ground is to be looked into to examine the validity of the order.
35. Reference in this regard can conveniently be made to the judgment of the Hon'ble Supreme Court in Chairman, All India Railway Recruitment Board and another vs. K.Shyam Kumar and others (2010) 6 SCC 614 and it shall be apposite to refer to paragraphs 44 and 45 of the judgment which reads as under:
"44. We are also of the view that the High Court has committed a grave error in taking the view that the order of the Board could be judged only ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 29 on the basis of the reasons stated in the impugned order based on the report of vigilance .
and not on the subsequent materials furnished by the CBI. Possibly, the High Court had in mind the constitution bench judgment of this Court in Mohinder Singh Gill and Anr. Vs. The Chief Election Commissioner, New Delhi and Anr. (1978) 1 SCC
405.
45. We are of the view that the decision maker can always rely upon subsequent materials to support the decision already taken when larger public interest is involved. This Court in Madhyamic Shiksha Mandal, M.P. v. Abhilash Shiksha Prasar Samiti and Others, (1998) 9 SCC 236 found no irregularity in placing reliance on a subsequent report to sustain the cancellation of the examination conducted where there were serious allegations of mass copying. The principle laid down in Mohinder Singh Gill's case is not applicable where larger public interest is involved and in such situations, additional grounds can be looked into to examine the validity of an order.
Finding recorded by the High Court that the report of the CBI cannot be looked into to examine the validity of order dated 04.06.2004, cannot be sustained."
36. The aforesaid judgment was then followed by the Hon'ble Supreme Court in PRP Exports and others vs. Chief Secretary, Government of Tamil Nadu and ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 30 others (2014) 13 SCC 692, in 63 Moons Technologies and others vs. Union of India and others (2019) SCC .
online SC 624, wherein the Hon'ble Supreme Court clarified that though there is no broad principles that Mohinder Singh Gill's test will not apply where a larger public interest is involved, subsequent materials in the form of facts that have taken place after the order in question is passed, can always be looked at in the larger public interest, in order to support the administrative order.
37. All the aforesaid judgments have in turn now been considered and approved by three Judge Bench of the Hon'ble Supreme Court in Internet and Mobile Association of India vs. Reserve Bank of India (2020) 3 Madras Law Journal 541, wherein it was observed as under:
" M.S.Gill Reasoning 6.126.The impugned Circular cannot be assailed on the basis of M. S. Gill test, for two reasons. First is that in Chairman, All India Railway Recruitment Board v. K. Shyam Kumar & Ors,(2010) 6 SCC 614, this court held that MS Gill test may not always be applicable where larger public interest is involved and that in such situations, additional ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 31 grounds can be looked into for examining the validity of an order. This was followed in PRP .
Exports & Ors v. Chief Secretary, Government of Tamil Nadu & Ors.,(2014) 13 SCC 69. In 63 Moons Technologies ltd. & Ors v. Union of India & Ors,(2019) SCC online SC 624, this court clarified that though there is no broad proposition that MS Gill test will not apply where larger public interest is involved, subsequent materials in the form of facts that have taken place after the order in question is passed, can always be looked at in the larger public interest, in order to support an administrative order. The second reason why the weapon of MS Gill will get blunted in this case, is that during the pendency of this case, this court passed an interim order on 21-08- 2019 directing RBI to give a point-wise reply to the detailed representation made by the writ petitioners.
Pursuant to the said order, RBI gave detailed responses on 04-09-2019 and 18-09-2019.
Therefore, the argument based on MS Gill test has lost its potency."
38. From the aforesaid discussion and the reasons as stated above, it is abundantly clear that the petitioner does not fulfill the eligibility criteria as per NIT and since the work for which the NIT is issued carries a special nature of work and it is the prerogative of the respondents/tender approving authority to include any term and condition as ::: Downloaded on - 28/09/2020 20:18:48 :::HCHP 32 per the requirement of the work to be executed at field and the same being not perverse, arbitrary or mala fide or with .
an intent to benefit anyone of the contractors cannot be interfered with.
39. Accordingly, we find no merit in this writ petition and the same is dismissed, leaving the parties to bear their own costs. Pending application, if any, also stands disposed of. r (Tarlok Singh Chauhan) Judge (Jyotsna Rewal Dua) Judge 28th September, 2020.
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