Gujarat High Court
M/S Reliable Art Printery (Ahmedabad) ... vs Women And Child Development Department ... on 8 June, 2021
Equivalent citations: AIRONLINE 2021 GUJ 1604
Author: J.B.Pardiwala
Bench: J.B.Pardiwala, Vaibhavi D. Nanavati
C/SCA/15863/2020 ORDER DATED: 08/06/2021
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 15863 of 2020
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M/S RELIABLE ART PRINTERY (AHMEDABAD) PRIVATE LIMITED
Versus
WOMEN AND CHILD DEVELOPMENT DEPARTMENT (WCD)
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Appearance:
MS J N DEKAVADIYA(7792) for the Petitioner(s) No. 1
MR MIT THAKKAR AGP(1) for the Respondent(s) No. 1,2,3
MR. TIRTHRAJ PANDYA(6685) for the Respondent(s) No. 1,2,3
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CORAM: HONOURABLE MR. JUSTICE J.B.PARDIWALA
and
HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI
Date : 08/06/2021
ORAL ORDER
(PER : HONOURABLE MR. JUSTICE J.B.PARDIWALA) 1 By this writ application under Article 226 of the Constitution of India, a Private Limited Company registered under the Companies Act, 1956, has prayed for the following reliefs:
"A) Your Lordships may be pleased to admit this matter and direct to respondent(s) to maintain the status quo and not to issue any contract and/or tender in connection with bid No.GeM/2020/B/780894.
B) Your Lordships further be please to direct the respondent(s) through the issuance of writ of mandamus to withdraw the disqualification of the petitioner and issue the public apology for issuance and public announcement of such reasons for such disqualification.
C) Your Lordships further be please to direct the respondent(s) through the issuance of writ of mandamus to issue public apology followed by public announcement of such apology clarifying the premature declaration of the 'conviction', followed by specific directions to reissue of the fresh bid for the subject matter of bid No.GEM/2020/B/780894.Page 1 of 6 Downloaded on : Wed Jun 09 23:40:07 IST 2021
C/SCA/15863/2020 ORDER DATED: 08/06/2021 D) Your Lordships further be please to direct the respondent(s) to pay the exemplary cost of Rs.10,00,000/ to set an example for not to disqualify and/or have preconceived notion regarding the petitioner and not to indulge into such malpractice by overruling the due process of laws."
2 The facts giving rise to this writ application may be summarised as under:
3 The writ applicant is engaged in the business of setting up of printing press as well as printing. The respondent No.3 issued a notice of Tender dated 9th September 2020 for the printing service. The bid document is at page : 15 of the paper book (Annexure : B). It is the case of the writ applicant that pursuant to the notice of Tender, it offered its bid along with the necessary documents as required in accordance with the terms and conditions of the Tender document. The respondent No.3 came to learn before the technical bid could be open that one F.I.R. has been registered against the Directors of the writ applicant - company by the Gujarat Council of Educational Research and Training alleging fraud. In such circumstances, the technical bid of the writ applicant came to be rejected invoking Rule 151 of the General Financial Rules, 2017 issued by the Ministry of Finance, Department of Expenditure. Rule 151 of Chapter 6 of the Rules, 2017 provides for debarment from bidding. It reads thus:
"Rule 151 Debarment from bidding.
(i) A bidder shall be debarred if he has been convicted of an offence
(a) under the Prevention of Corruption Act, 1988; or
(b) the Indian Penal Code or any other law for the time being in force, for causing any loss of life or property or causing a threat to public health as part of execution of a public procurement contract.
(ii) A bidder debarred under subsection (i) or any successor of the bidder Page 2 of 6 Downloaded on : Wed Jun 09 23:40:07 IST 2021 C/SCA/15863/2020 ORDER DATED: 08/06/2021 shall not be eligible to participate in a procurement process of any procuring entity for a period not exceeding three years commencing from the date of debarment. Department of Commerce (DGS&D) will maintain such list which will also be displayed on the website of DGS&D as well as Central Public Procurement Portal.
(iii) A procuring entity may debar a bidder or any of its successors, from participating in any procurement process undertaken by it, for a period not exceeding two years, if it determines that the bidder has breached the code of integrity. The Ministry/Department will maintain such list which will also be displayed on their website.
(iv) The bidder shall not be debarred unless such bidder has been given a reasonable opportunity to represent against such debarment."
4 As the technical bid came to be rejected on such grounds, the writ applicant had to come before this Court with the present writ application.
5 During the pendency of the present writ application, the Tender came to be awarded in favour of one M/s. Wilson Printcity Private Limited vide work order dated 23rd November 2020. The following has been stated in the affidavitinreply filed on behalf of the respondent No.2:
"6. At the outset, it is submitted that present petition qua prayer 7(A) become infructuous inasmuch as, the tender in question came to be awarded in favour of M/s. Wilson Printcity Private Limited vide work order dated 23.11.2020. It is also pertinent to mention here that pursuant to work order dated 23.11.2020, M/s. Wilson Printcity Private Limited has already satisfied the tender in question was published. Hence, present petition qua challenge to the tender in question does not survive. A copy of work order dated 23.11.2020 is annexed hereto and marked as Annexure R1 and copies of work completion certificates are annexed hereto and marked as AnnexureR2(colly).
7. The petition also deserves to be dismissed at the threshold for the failure of the petitioner in availing alternate efficacious remedy to approach the tendering authority within 48 hours of incurring disqualification in technical criteria to get the reasons for rejection reviewed and to raise one time representation to challenge rejection for any incorrect Page 3 of 6 Downloaded on : Wed Jun 09 23:40:07 IST 2021 C/SCA/15863/2020 ORDER DATED: 08/06/2021 disqualification. It is also provided that the tendering authority is duty bound to respond to such representation. A copy of screen shot in this regarding is annexed hereto and marked as AnnexureR3. It is deemed that the petitioner was conscious of such alternate remedy as the same was intimated on the GeM portal from where the petitioner received the reasons for its disqualification."
6 We have heard Ms. J. N. Dekavadiya, the learned counsel appearing for the writ applicant and Mr. Mit Thakkar, the learned A.G.P. appearing for the respondents.
7 Ms. Dekavadiya vehemently submitted that the technical bid of her client was wrongly rejected invoking Rule 151 of the Rules, 2017 referred to above. The learned counsel submits that none of the Directors of the writ applicant - company has been convicted for any offence. She further clarifies that even the company, as a legal entity, has not suffered any conviction for any particular offence. She would argue that Rule 151 speaks about conviction of an offence under the Prevention of Corruption Act, 1988 or the Indian Penal Code or any other law for the time being in force. She would submit that mere registration of an F.I.R. against the writ applicant - company for the alleged fraud could not have been a ground to disqualify the company from bidding invoking Rule 151 of the Rules 2017. It is argued that it was a mistake on the part of the respondents which has proved to be very costly to her client. It is argued that it has caused a social stigma on her client.
8 However, in view of what has been averred in the affidavitin reply filed on behalf of the respondents referred to above, Ms. Dekavadiya would fairly submit that she would not press the reliefs as prayed for in paras 7(A), 7(B) and 7(C). However, she very firmly submitted that she would press for the relief as prayed for in para 7(D).
Page 4 of 6 Downloaded on : Wed Jun 09 23:40:07 IST 2021C/SCA/15863/2020 ORDER DATED: 08/06/2021 9 On the other hand, this writ application has been vehemently
opposed by Mr. Mit Thakkar, the learned A.G.P. appearing for the respondents. At the outset, Mr. Thakkar submitted that this writ application has become infructuous as the entire work allotted pursuant to the Tender has been completed. Nothing remains to be done. Mr. Thakkar would clarify that in fact, what weighed with the respondents in rejecting the bid offered by the writ applicant is the registration of the F.I.R. and the allegation of fraud alleged to have been committed by the writ applicant with a government company. However, he fairly conceded that while rejecting the bid offered by the writ applicant, the reference of Rule 151 referred to above was not necessary. It is argued that it is within the discretion of the respondents to reject the bid if something like fraud as alleged comes to its notice. He would submit that if the writ applicant has grievance in any manner, then it is open for the writ applicant to file a suit for damages before a competent Civil Court. However, the relief as prayed for in para 7(D) may not be granted.
10 Having heard the learned counsel appearing for the parties and having gone through the materials on record, the only question that falls for our consideration is whether in view of the facts recorded above, the writ applicant is entitled to the relief as prayed for in para 7(D).
11 We are at one with Ms. Dekavadiya that the invocation of Rule 151 of the Rules 2017 was a blunder on the part of the respondents. There is no doubt that Rule 151 would be attracted only in the case of the writ applicant - company or one of its Directors has suffered a conviction for the offence punishable under the provisions of the Prevention of Corruption Act or the Indian Penal Code or any other enactment of law. Such is not the case over here. It may be true that an Page 5 of 6 Downloaded on : Wed Jun 09 23:40:07 IST 2021 C/SCA/15863/2020 ORDER DATED: 08/06/2021 F.I.R. has been registered alleging fraud, but, if the respondents wanted to reject the bid offered by the writ applicant on such grounds, then it should not have said anything about Rule 151 of the Rules, 2017. They could have said that having regard to the nature of the allegation of fraud, the technical bid offered by the writ applicant is rejected. The matter should have been closed over there.
12 However, the fact remains that the entire work allotted pursuant to the Tender document has been completed by one company referred to above. Nothing remains to be done further. So far as the exemplary cost of Rs.10 Lakh, as prayed for, is concerned, we are of the view that the writ applicant may consider preferring a civil suit in accordance with law before a competent Civil Court and pray for damages if at all it is maintainable in law. We clarify that it is not that this Court cannot or should not grant such exemplary cost as prayed for, but, in the peculiar facts and circumstances of the case, we are not inclined to pass such order.
13 In view of the aforesaid, this writ application stands disposed of.
(J. B. PARDIWALA, J) (VAIBHAVI D. NANAVATI,J) CHANDRESH Page 6 of 6 Downloaded on : Wed Jun 09 23:40:07 IST 2021