Orissa High Court
Celex Technologies Pvt. Ltd And Another vs State Of Odisha And Others on 8 September, 2017
Equivalent citations: AIR 2018 (NOC) 182 (ORI.)
Author: Vineet Saran
Bench: Vineet Saran
HIGH COURT OF ORISSA : CUTTACK
W.P.(C) No. 4873 of 2017
In the matter of an application under Articles 226 and 227 of the
Constitution of India.
-----------
Celex Technologies Pvt. Ltd
AFR and another ........ Petitioners
-Versus-
State of Odisha and others ......... Opp. Parties
For petitioners : Mr. R.K. Mohanty, Sr. Advocate
along with M/s. A.K. Acharya,
S. Mishra and (Ms) S. Chakrabarty,
Advocates.
For opp. parties : Mr. S.P. Mishra, Advocate General
along with Mr. P.K. Muduli, Addl.
Government Advocate.
---------------
PRESENT
THE HONOURABLE THE CHIEF JUSTICE MR. VINEET SARAN
AND
THE HONOURABLE DR. JUSTICE B.R. SARANGI
---------------------------------------------------------------------------------
Date of hearing : 23.08.2017 :: Date of judgment: 08.09.2017
---------------------------------------------------------------------------------
2
DR. B.R. SARANGI, J Celex Technologies Private Limited-petitioner
no.1, a company incorporated under the Companies Act, 1956,
having its registered office at Kolkata, represented through its
Director-petitioner no.2, is carrying on its business of production
and distribution of High Security Registration Plates (HSRP). The
petitioners have filed this application challenging the letter
bearing no. 8290 dated 25.11.2016 of Commerce and Transport
(Transport) Department, Government of Odisha, as well as letter
bearing no. 18607/TC dated 28.11.2016 for cancelling the tender
dated 04.05.2015 issued by the Addl. Commissioner, Transport
(Technical), State Transport Authority, Odisha, Cuttack inviting
bids for manufacture, distribution and affixation of HSRP on a
Build, Own, Operate (BOO) basis, in which petitioner no.1 was
the lowest bidder and also assail the fresh tender notice bearing
no. 2834/TC dated 03.03.2017 inviting fresh bids for
manufacture, distribution and affixation of HSRP on a Build,
Own, Operate (BOO) basis on the ground that the same is
arbitrary, unreasonable and contrary to the provisions of law.
2. The factual matrix of the case is that the Government
of India on 28.03.2001 issued a notification under the provisions
of Section 41(6) of the Motor Vehicles Act, 1988 (in short "MV Act,
3
1988") read with Rule 50 of the Central Motor Vehicles Rules,
1989 (in short "CMV Rules, 1989") for implementation of the
provisions of the said Act and for introduction of a new scheme
regulating issuance and fixation of HRSP. In order to give effect to
the provisions of the MV Act, 1988 and the CMV Rules, 1989, the
Motor Vehicles (New High Security Registration Plates) Order,
2001 ( in short "2001 Order") came into force with effect from
September, 28, 2001. By the 2001 Order, certain standards in
respect of HSRP for motor vehicles and the process used by a
manufacturer or vendor for manufacturing or supplying such
plates were notified. Under Order 4(ii) of the 2001 Order, the
registration plates have to conform to the specifications spelt out
in Rule 50 of the CMV Rules, 1989. Further notifications were
also issued for implementation of the 2001 Order and the HSRP
Scheme. Rule 50 of the CMV Rules, 1989 was amended on
01.06.2005mandating the introduction of new tamper proof HSRP.
3. Challenging the Central Government's power to issue such notifications as well as the terms and conditions of the tender process, the Association of Registration Plates filed writ petitions before various High Courts. Ultimately those writ 4 petitions were transferred to the Supreme Court of India and heard together. The apex Court in Association of Registration Plates v. Union of India, (2005) 1 SCC 679 dismissed the writ petitions upholding the validity of Rule 50 of the CMV Rules, 1989, as well as the tender conditions, and directed for implementation of the Scheme. Due to non-implementation of HSRP Scheme, the apex Court passed orders time and again to ensure its implementation. On 8th May, 2008 in Maninderjit Singh Bitta v. Union of India, (2008) 7 SCC 328 the apex Court observed that it would be in the interest of all concerned the States and Union Territories directed to take definite decision within 6 months as to whether there was need for giving effect to the amended Rule 50 of the Rules, 1989 and Scheme of HSRP keeping in view that scheme was introduced in the interest of public safety. In spite of such order, the States failed to implement the schemes. By order dated 05.05.2009, the Supreme Court of India held that there is no discretion given to the States/ Union Territories in implementation of the amended Rules. By an order dated 07.04.2011 passed in Maninderjit Singh Bitta v. Union of India (2011) 11 SCC 315, the apex Court took serious view of the matter that there were certain States which have not 5 even started the process of implementation of HSRP Scheme and directed such States to file affidavits explaining why contempt proceedings should not be initiated against them. It was observed by the Supreme Court of India that despite tenders being issued long back, no further step was taken. The Supreme Court of India took serious view regarding the fact of non-implementation of HSRP Scheme in its order dated 30.08.2011 in Maninderjit Singh Bitta v. Union of India, (2011) 14 SCC 273 and also in its order dated 03.10.2011 in (2012) 1 SCC 273. Consequentially, due to non-implementation of such order, the Supreme Court of India held the State of Haryana to have committed contempt of its order. By order dated 08.12.2011 in (2012) 1 SCC 707 Supreme Court of India referred to the affidavits filed by various States and in order to ensure the implementation of HSRP Scheme, in which the State of Odisha had filed an affidavit stating therein that HSRP Scheme would be implemented in its entirety by April 30, 2012. Finally, on 07.02.2012 in (2012) 4 SCC 568, the Supreme Court of India disposed of the W.P.(C) No. 510 of 2005 by sending the files to the respective High Courts to take action as per law and further gave directions regarding implementation of HSRP Scheme.
6
4. In this backdrop of the issue, for the purpose of implementation of HSRP Scheme, on 28.02.2007, opposite party no.1 invited bids for selection of bidder for supply and installation of HSRP in the State of Odisha. After several extensions, 8 bidders finally submitted their bids. After opening of the bids, the Government of Odisha directed the bidders to submit revised price proposal. In response to the same, the lowest bid was offered by the Rosemarta Technologies Pvt. Ltd., which was also found to be too high. Consequentially, the Government of Odisha cancelled the tender process for supply and affixation of HSRP vide letter dated 05.05.2012. Being aggrieved by such action of the Government of Odisha, the Rosemarta Technologies Pvt. Ltd. filed W.P.(C) No. 9084 of 2012 in this Court challenging the annulment of the tender vide letter dated 05.05.2012. The said writ petition was dismissed by this Court on 04.09.2012. Consequentially, opposite party no.1 on 12.09.2012, again invited bids from interested parties for selecting an organization for supply and affixation of HSRP in the State of Odisha. Pursuant thereto, only one bidder, namely, M/s. Shimnit Utsch India Private Limited participated in the bid. Consequentially, the Government of Odisha cancelled the said tender to invite a fresh 7 tender for better competition. The said action of the State Government was challenged by M/s. Shimnit Utsch India Private Limited in W.P.(C) No. 1179 of 2015, but no order was passed by this Court in its favour.
5. On 04.05.2015, a fresh tender notice was issued by the State of Odisha inviting bids for manufacture, distribution and affixation of HSRP on Build, Own and Operate (BOO) basis. Petitioner no.1 participated in the tender by obtaining tender documents from the office of opposite party no.1 upon payment of cost of bid documents of Rs.30,000/-. By that time, W.P.(C) No. 1179 of 2015 filed by M/s. Shimnit Utsch India Private Limited being pending, this Court passed an interim order prohibiting finalization of tender in question, but it was made clear that the process of tender had not been stayed by the said interim order till 31.07.2015. On 21.08.2015, petitioner no.1 submitted its bid before opposite party no.2 along with bid security of Rs.20 lakhs in the form of irrevocable bank guarantee. Three bidders, other than petitioner no.1, including M/s. Shimnit Utsch India Private Limited submitted their offers pursuant to the tender notice dated 04.05.2015. On 06.05.2016 the tender committee examined all the documents and credentials, and after much deliberation, 8 short listed two out of four bidders. Consequentially, the bids of petitioner no.1 and M/s. Shimnit Utsch India Private Limited were opened. The bid submitted by M/s. Shimnit Utsch India Private Limited was found to be higher than that submitted by petitioner no.1. Consequentially, the offer given by petitioner no.1, being the lowest, the team of officers of State Transport Authority visited petitioner no.1's plant and submitted report in its favour on 18.02.2016. Accordingly on 14.03.2016, the tender committee decided to recommend the name of petitioner no.1 as the preferred bidder for execution of HSRP Scheme in Odisha at the price quoted by it along with the bid proposals. On 19.03.2016, opposite party no.2 forwarded the copy of the proceedings of the meetings held for evaluation of the bids by the tender committee for HSRP Scheme in the State of Odisha to opposite party no.1 for according necessary Government approval. By letter no. 18607/TC dated 28.11.2016 the Additional Commissioner, Transport (Technical), State Transport Authority, Odisha, Cuttack informed the petitioners that the tender notice dated 04.05.2015 of Government of Odisha had been cancelled as per the order contained in the letter no. 8290 dated 25.11.2016 of Commerce and Transport (Transport) Department, Government of Odisha. 9 Consequently, on 03.03.2017 a fresh tender call notice was issued for the self-same purpose. Hence this application.
6. Mr. R.K. Mohanty, learned Senior Counsel appearing along with Mr. A.K. Acharya and Ms. S. Chakrobarty, learned counsel for the petitioners strenuously urged that the order of cancellation of tender call notice dated 04.05.2015 communicated to the petitioners on 28.11.2016 has been passed without assigning any reason. Though the said order has made a reference to letter bearing No.8290 dated 25.11.2016 of Commerce and Transport (Transport) Department, Govt. of Odisha, the same has never been communicated to the petitioner. Therefore, cancellation of the tender, basing upon an un- communicated letter dated 25.11.2016 of Commerce and Transport (Transport) Department, Govt. of Odisha cannot sustain in the eye of law. Further, the letter dated 28.11.2016, which has been communicated cancelling the tender dated 04.05.2016, having not contained any reason, is liable to be set aside, and petitioner no.1, being the lowest bidder pursuant to the tender call notice dated 04.05.2015, necessary orders should have been passed awarding the tender in its favour for Manufacture, Distribution and Affixation of HSRP on a Build, 10 Own and Operate (BOO) basis. So far as the price quotation, as referred to in course of argument, is concerned, it is contended that since the Tender Evaluation Committee, having analyzed the tender documents of petitioner no.1 as well as other competitors, and having been satisfied with the price quoted, recommended to the Government for approval, subsequently it should not have turned around for cancellation of tender, which is arbitrary, unreasonable and contrary to the provisions of law. Consequentially, issuance of fresh tender notice dated 03.03.2017 also cannot sustain in the eye of law. It is further contended that the State Government is expected to act fairly and justly to implement the direction of the apex Court honestly and truly. Even though in the meantime ten years have elapsed since the amendment of the provisions of law, the same has not been given effect to on some plea or the other, and as such, on the analysis of the factual matrix it appears that for the self-same purpose, even though petitioner no.1 qualified in 3rd round of tender, the same has not been awarded in its favour, in spite of recommendation made by the tender committee and fresh tender notice has been issued on 03.03.2017, which cannot sustain in the eye of law. To substantiate his contentions, he has relied upon 11 Maninderjit Singh Bitta v. Union of India and others, (2012) 1 SCC 707, State of Punjab v. Bandeep Singh and others, (2016) 1 SCC 724, M/s Star Enterprises and others v. City and Industrial Development Corporation of Maharashtra Ltd. and others, (1990) 3 SCC 280, Food Corporation of India v. M/s. Kamdhenu Cattle Feed Industries, AIR 1993 SC 1601, Union of India v. Dinesh Engineering Corporation and another, AIR 2001 SC 3887, Mahabir Auto Stores and others v. Indian Oil corporation and others, AIR 1990 SC 1031, M/s. Shree Ganesh Construction v. State of Orissa and others, 2016(II) OLR 237, M/s. D.K. Engineering and Construction v. State of Odisha and another, 2016(II) ILR-CUT-515, M/s. B.M.P. and Sons Pvt. Ltd. v. State of Odisha and others, 2016(II) ILR-CUT-272 and Red Tech Solutions India Pvt. Ltd. and another v. State of Odisha and others, 2016(I) ILR-CUT- 1077.
7. Per contra, Mr. S.P. Mishra, learned Advocate General appearing along with Mr. P.K. Muduli, learned Additional Government Advocate for the State-opposite parties stated that the writ petition is not maintainable either in fact or in law, as no right has accrued in favour of petitioner no.1, the bid submitted 12 by it being not accepted by the competent authority, i.e., the State Government. The matter relating to implementation of HSRP Scheme has been adjudicated by the Supreme Court in W.P.(C) No.510 of 2005, and in compliance of the direction of the Supreme Court of India, the proposals of the bidders were opened with the intention to finalize the tender process and implement the HSRP Scheme in the State of Odisha. After opening of price proposal, it revealed that the price quoted by petitioner no.1 was much higher compared to the rates finalized in some other States, where tender processes have been finalized/completed. It is further contended that merely because petitioner no.1 participated in the tender process, it cannot claim for award of work. It is contended that, the award of work depends upon several factors and more particularly, as per Clause 4.9.1 of the Bid Documents, the Government of Odisha reserves the right to summarily accept or reject any or all of the proposals, without assigning any reason, and to take any measure as it may deem fit, including annulment of the bidding process, at any time prior to the execution of the contract. Since the price quoted by petitioner no.1 is higher in comparison to other States, where the tender processes have been finalized, if the petitioner no.1 is allowed to 13 execute the work with that higher price, then the people of Odisha will be burdened. Therefore, the Government of Odisha have decided to invite fresh bids to select the suitable bidders for implementation of HSRP Scheme as per direction of Supreme Court of India. Consequentially, no illegality or irregularity has been committed by cancelling the tender notice dated 04.05.2016. It is further contended that the writ petition is otherwise also not maintainable in view of non-joinder of proper parties. In order to substantiate his case, he has relied upon State of Jharkhand and others v. M/s. CWE-SOMA Consortium, AIR 2016 SC 3366, Afcons Infrastructure Ltd. v. Nagpur Metro Rail Corporation Ltd. and others, AIR 2016 SC 4305, Rishi Kiran Logistics Private Limited v. Board of Trustees of Kandla Port Trust and others, (2015) 13 SCC 233, Chandra Sekhar Swain (in both) v. State of Odisha and others (in both), 2017 (I) OLR 666, Meerut Development Authority v. Association of Management Studies and another, (2009) 6 SCC 171 and Siemens Public Communication Networks Private Limited and another v. Union of India and others, (2008) 16 SCC 215.
8. Having heard learned Senior Counsel appearing for the parties and as the pleadings have been exchanged, with the 14 consent of the parties, this writ petition is disposed of finally at the stage of admission.
9. Undisputedly, the facts delineated above indicate that, in order to give effect to the provisions of the MV Act, 1988 read with CMV Rules, 1989 and 2001 Order, steps have been taken by the State Government for implementation of HSRP Scheme in compliance of the directions given by the apex Court.
For better appreciation, the provisions relevant for the purpose of this case are quoted below:
Section 41(6) of the Motor Vehicles Act, 1988.
41. Registration, how to be made. -
xx xx xx (6) The registering authority shall assign to the vehicle, for display thereon, a distinguishing mark ( in this Act referred to as the registration mark ) consisting of one of the groups of such of those and followed by such letters and figures as are allotted to the State by the Central Government from time to time by notification in the Official Gazette, and displayed and shown on the motor vehicle in such form and in such manner as may be prescribed by the Central Government.
Rule 50 of the Central Motor Vehicle Rules, 1989..
50. Form and manner of display of registration marks on the motor vehicles.--(1) On or after commencement of this rule, the registration mark referred to in sub-section (6) of section 41 shall be displayed both at the front and at the rear of all motor vehicles clearly and legibly in the form of security license plate of the following specifications, namely:-- 15
(i) the plate shall be a solid unit made of 1.0 mm aluminium conforming to DIN 1745/DIN 1783 or ISO 7591. Border edges and corners of the plate shall be rounded to avoid injuries to the extent of approx. 10 mm and the plates must have an embossed border.
The plate shall be suitable for hot stamping and reflective sheet has to be guaranteed for imperishable nature for minimum five years. The fast colouring of legend and border to be done by hot stamping;
(ii) the plate should bear the letters "IND" in blue colour on the extreme left centre of the plate. The letter should be one-fourth of the size of letters mentioned in rule 51 and should be buried into the foil or applied by hot stamping and should be integral part of the plate;
(iii)each plate shall be protected against counterfeiting by applying chromium-based hologram, applied by hot stamping. Stickers and adhesive labels are not permitted. The plate shall bear a permanent consecutive identification number of minimum seven digits, to be laser branded into the reflective sheeting and hot stamping film shall bear a verification inscription;
(iv)apart from the registration marks on the front and rear, the third registration mark in the form of self- destructive type, chromium based hologram sticker shall be affixed on the left-hand top side of the windshield of the vehicle. The registration details such as registration number, registering authority, etc., shall be printed on the sticker. The third registration mark shall be issued by the registering authorities/approved dealers of the license plates manufacturer alongwith the regular registration marks, and thereafter if such sticker is destroyed it shall be issued by the license plate manufacturer or his dealer;
(v)the plate shall be fastened with non-removable/non- reusable snap lock fitting system on rear of the vehicle at the premises of the registering authority;
The license plates with all the above specifications and the specified registrations for a 16 vehicle shall be issued by the registering authority or approved the license plates manufacturers or their dealers. The Central Road Research Institute, New Delhi or any of the agency authorized by the Central Government shall approve the license plates manufacturers to the above specification;
(vi)the size of the plate for different categories of vehicles shall be as follows:--
For two and three-wheelers 200 x 100 mm
For Light Motor Vehicles/ 340x200mm/
Passenger cars 500x 120 mm
For medium commercial
vehicles, heavy commercial
340 x200 mm
vehicles and Trailer/
combination
Provided that this sub-rule shall apply to already registered vehicles two years from the date of commencement:
Provided further that the size of the registration plates for agricultural tractors shall be as follows:--
Front - - 285x45 mm Rear - - 200x100 mm:
Provided also that the size of registration plate for power tiller shall be 285x45 mm and shall be exhibited at the front. Further, in case of trailer coupled to power tiller, the size of registration plate shall be 200x100 mm and shall be exhibited on its rear:
Provided also that in case of a motor cycle, the size of 285x45 mm for front registration plate shall also be permitted.
(2) In the case of motor cycles the registration mark in the front shall be displayed parallel to the handle bar or on any part of the vehicle including mudguard 17 facing the front instead of, on a plate in line with the axis of the vehicle:
Provided that--
(a) the registration mark exhibited at the rear of a transport vehicle shall be affixed to the vehicle on the right hand side at a distance not exceeding one metre from the ground as may be reasonably possible having regard to the type of the body of the vehicle;
(b)the registration mark shall also be painted on the right and left side on the body of the vehicle in the case of a transport vehicle;
(c) the registration mark shall also be painted and exhibited on the partition provided between the driver and the passengers, facing the passengers' seats or, where there is no such partition, on the front interior of the vehicle near the roof to the left side of the driver's seat facing the passengers' seats in the case of a stage carriage or a contract carriage and in the case of a motor cab or a taxi cab it shall be sufficient if the registration mark is painted on the dash-board;
(d)the letters of the registration mark shall be in English and the figures shall be in Arabic numerals and shall be shown:--
(A)in the case of transport vehicles in black colour on yellow background; and (B) in other cases, in black colour on white background, the registration mark on the trailer shall be exhibited on the left hand side in black colour on yellow background. In addition, the registration mark on the drawing vehicle shall be exhibited on the trailer also and this shall be done on the right hand side at the rear of the trailer or the last trailer as the case may be, in black colour on retro-
reflective type yellow background:
18
Provided that where provisions of this clause have not been complied with in respect of motor vehicle, on or before the commencement of the Central Motor Vehicles (8th Amendment) Rules, 2001, then the provisions shall be complied with,--
(i) in respect of transport vehicle, on or before 1st February, 2002; and
(ii) in other cases, on or before 1st July, 2002.
(3) The registration mark shall be exhibited in two lines, the State code and registering authority code forming the first line and the rest forming the second line, one below the other:
Provided that the registration mark in the front may be exhibited in one line:
Provided further that in models of two vehicles having no sufficient provision at the rear to exhibit the registration mark in two lines, it shall be sufficient if in such vehicles registration mark is exhibited in a single line:
Provided further that registration mark on a light motor vehicle may be in the centre with illumination.
(4) Every motor vehicle, except motor cab and motor car, manufactured on and from the date of commencement of the Central Motor Vehicles (Amendment) Rules, 1993, shall be provided with sufficient space in the rear for display of registration mark in two lines.
(5) In case of agricultural tractors, the registration mark need not be inclined to the vertical plane by more than 45 degrees.
(6) The registration mark of the drawing agricultural tractor may not be exhibited on the agricultural trailer or trailers."19
Order 4(ii) of the Motor Vehicles (New High Security Registration Plates) Order, 2001.
4. A manufacturer or supplier of new high security registration plates shall comply with the following specifications, namely:--
xx xx xx
(ii) The registration plate shall conform to the specifications spelt out in rule 50 of the Central Motor Vehicles Rules, 1989; and shall conform to 2 [DIN 74069--1975 and ISO 7591--1982, as amended from time to time till such time as the corresponding BIS specifications are notified]. The Registration Plate has to be guaranteed for imperishable nature for a minimum of five years.
(iia) The size of the registration plate for different categories of vehicles shall be in accordance with clause
(vi) to sub-rule (1) of rule 50 of the Central Motor Vehicles Rules, 1989. However, in case of motorcycles, the size of the plate may be used 285 x 45 mm.
xx xx xx"
10. The above being the provisions of law governing the field, to give effect to such provisions, the apex Court, time and again, issued directions to all the State Governments for implementation of HSRP Scheme to provide HSRP to the users of the motor vehicles. Time and again the Government has floated tenders, and on some plea or other, cancelled the same. Finally on 04.05.2016, when a tender notice was issued inviting bids, the petitioner along with three others participated in the tender process and out of them, after examining all the documents and credentials and after much deliberation, the tender committee 20 short listed two bidders on 06.02.2016. Consequentially, the bids of petitioner no.1 and M/s. Shimnit Utsch India Pvt. Ltd. were opened. As the bid submitted by M/s. Shimnit Utsch India Pvt. Ltd. was found to be higher than that of the petitioner no.1, the tender committee decided to recommend the case of petitioner no.1 for execution of HSRP Scheme in Odisha at the price quoted by it along with bid proposal. Accordingly, on 19.03.2016 opposite party no.2 forwarded the copy of the proceedings of the meeting, held for re-evaluation of bids by the tender committee for implementation of HSRP Scheme, to the Government for according necessary approval. As per the order dt. 28.11.2016, the Additional Commissioner, Transport (Technical) State Transport Authority, Odisha, Cuttack communicated petitioner no.1, as well as other bidders, stating inter alia that the tender notice dated 04.05.2015 of Government of Odisha inviting bids for implementation of HSRP in Odisha was cancelled. Though reference was made to letter no. 8290 dated 25.11.2016 of Commerce and Transport (Transport) Department, Government of Odisha, the said letter was not communicated to petitioner no.1. More so, the order of cancellation of the tender in Annexure-1 21 dated 28.11.2016 does not indicate any reason for such cancellation.
11. It is well settled principle of law laid down by the apex Court time and again that the authority should pass reasoned order. Reasons being a necessary concomitant to passing an order, the authority can thus discharge its duty in a meaningful manner either by furnishing the same expressly or by necessary reference.
In Union of India v. Mohan Lal Capoor, AIR 1974 SC 87, it has been held that reasons are the links between the materials on which certain conclusions are based and the actual conclusions. They disclose how the mind is applied to the subject- matter for a decision whether it is purely administrative or quasi- judicial and reveal a rational nexus between the facts considered and conclusions reached. The reasons assure an inbuilt support to the conclusion and decision reached. Recording of reasons is also an assurance that the authority concerned applied its mind to the facts on record. It is vital for the purpose of showing a person that he is receiving justice.
22
Similar view has also been taken in Uma Charan v. State of Madhya Pradesh, AIR 1981 SC 1915 and in Patitapaban Pala v. Orissa Forest Development Corporation Ltd. & another, 2017 (I) OLR 5 and in Banambar Parida v. Orissa Forest Development Corporation Limited, 2017 (I) OLR 625.
12. As it appears from the counter affidavit filed by the opposite parties, now reasons have been assigned why such cancellation of tender has been made by the authority concerned. On perusal of the counter affidavit, in paragraph-6 it is mentioned that after opening of the price proposal it was revealed that price quoted by petitioner no.1 was much higher as compared to the rates finalized in some other States, where tender process have been finalized/completed. When the tender committee, on consideration of the price quoted by the bidders, found that petitioner no.1 has quoted lowest price and recommended its case to the State Government for approval, at that point of time question of comparison of the price quoted by petitioner no.1 vis- à-vis the bidders in other States who have quoted lower price, does not arise. No such consideration can be made by the authority concerned at the fag end of tender process. The letter dated 25.11.2016, which has not been communicated but 23 referred to in the impugned order dated 28.11.2016 at Annexure- 1, has been annexed as Annexure-B. It is stated therein that, in view of the fact that the percentage of two wheeler population is almost 80% of the total vehicle population in Odisha and the lowest rate quoted for two wheeler is very high in comparison to other States, the Government was pleased to cancel the tender floated by the Transport Commissioner on 04.05.2015 for greater public interest and directed to go for fresh tender and revise the bid documents to be prepared to provide for selection of L1 party by taking weighted average of the rate quoted for different types of vehicles. The explanation submitted by way of counter affidavit justifying the action taken by the Government has not been communicated to petitioner no.1, though in the impugned letter dated 28.11.2016 in Annexure-1 a reference has been made to the said letter dated 25.11.2016, and simply it has been sated that the tender notice dated 04.05.2015 issued by the Government of Odisha inviting bids for implementation of HSRP Scheme in Odisha is hereby cancelled.
13. It is well settled principle of law laid down by the apex Court in Mohinder Singh Gill and another v. The Chief 24 Election Commissioner, New Delhi and others, AIR 1978 SC 851 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."
In Commissioner of Police, Bombay v. Gordhandas Bhanji, AIR 1952 SC 16, the Apex Court held as follows :
"Public orders publicly made, in exercise of a statutory authority cannot be construed in the light of explanations subsequently given by the officer making the order of what he meant, or of what was in his mind, or what he intended to do. Public orders made by public authorities are meant to have public effect and are intended to affect the acting and conduct of those to whom they are addressed and must be construed objectively with reference to the language used in the order itself. Orders are not like old wine becoming better as they grow older."
Similar view has also been taken in Bhikhubhai Vithlabhai Patel and others v. State of Gujarat and another, (2008) 4 SCC 144 as well as in M/s. Shree Ganesh Construction (supra).
In the case of Bandeep Singh (supra) the apex Court held that the validity of administrative orders/decisions/executive 25 instructions/orders/circulars must be judged by reasons stated in decision or order itself. Subsequent explanations or reasons cannot be accepted to sustain decision or order.
14. Reliance has been placed by the opposite parties on Chandra Sekhar Swain (supra). In paragraph 21 of the said judgment it has been observed as follows:
"21. Annexure-7 dated 30.11.2016 is the order impugned, whereby the bid in respect of the work in question has been cancelled. The contention raised by learned Senior Counsel for the petitioner is that no reason has been assigned in support of such cancellation. To buttress his contention, he has placed reliance on M/s. Shree Ganesh Construction (supra). On perusal of the materials available on record, it appears that on 28.11.2016 the technical evaluation committee scrutinized the technical bids afresh on the basis of communication made on 17.11.2016. The proceedings of the technical evaluation committee held on 28.11.2016, which indicate the reasons for cancellation of the tender in question, were evidently made available on the website. On the basis of such reasons, as a consequential follow up action, the cancellation order was passed on 30.11.2016 in Annexure-7. In view of that, it cannot be said that the order of cancellation is a cryptic one, particularly when the same has been explained subsequently in the counter affidavit. If the reasons were available to the parties on the website on the date of cancellation, i.e., on 28.11.2016 itself, the communication vide Annexure-7, which was made on 30.11.2016, cannot be held to be unsustainable in the eye of law for not containing the reasons for cancellation of the bid in question. As such, the ratio decided in M/s. Shree Ganesh Construction (supra) is absolutely not applicable to the present case."26
In the said case, though the reasons had not been assigned, it was specifically mentioned that the proceedings of the technical evaluation committee held on 28.11.2016 which indicated reasons for cancellation of the tender in question was evidently made available on the website. Therefore, if the reasons were made available on the website itself, the communication made without assigning any reason cannot be said to be illegal or arbitrary or unreasonable. Therefore, the case of Chandra Sekhar Swain (supra) is distinguishable on the facts and circumstances of the instant case, and on the other hand the law laid in M/s Shree Ganesh Construction (supra) is applicable to the present case.
15. Much emphasis has been laid by the opposite parties on letter dated 25.11.2016, which has been filed as Annexure-B to the counter affidavit. In para-11 of the counter affidavit, it has been categorically mentioned as follows:
"..... As regards non-supply of copy of letter No.8390 dated 25.11.2016 of Government in Transport Department to the Petitioner it is humbly submitted that said letter is an internal communication between the Opp.Parties, as such the Petitioner is not entitled to get copy of the same. However, on basis of letter dtd.25.11.2016 of Government, the Petitioner and other bidders were intimated vide letter No.18607, dtd.28.11.2016 (Annexure-1) that Tender Notice dtd. 04.05.2015 (Annexure-7) was cancelled but the 27 Petitioners did not show any interest to obtain a copy thereof under the Right to Information Act....."
On one hand, vide letter dated 28.11.2016 in Annexure-1 the opposite parties are referring to letter dated 25.11.2016, and on the other, in the counter affidavit the aforesaid stand has been taken by them to justify the reason for non-supply of such documents in the name of inter departmental communication between the opposite parties, and it is admitted that the petitioner is not entitled to get copy of the same. Therefore, on the basis of an un-communicated letter, the order of cancellation of tender notice dated 04.05.2015, having been issued without assigning any reason, cannot sustain in the eye of law.
16. It was emphatically urged in course of argument, with reference to letter dated 25.11.2016, that the tender in question was cancelled, as the price quoted in different States for different categories of vehicles was lesser than that quoted by the petitioner no.1. From the comparative price statement for HSRP finalized in different States in past, which is available at Page 260 of the brief as part of Annexure-13, it appears that for a spell of 5 years, 10 years and 15 years the price has been quoted. So far as the price for the State of Odisha is concerned, it is for a period of 28 10 years. Therefore, only question has been raised in letter dated 25.11.2016 that since the percentage of two wheelers population is almost 80% of the total vehicles population in Odisha and the price quoted for the same being higher in comparison to other States, the tender has been cancelled. But the subject-matter or conditions stipulated in the tender documents do not indicate to take a comparative study of the price quoted in different States. Rather each State has to take a unique decision on the basis of different categories of vehicular movement, and accordingly price has to be fixed. Therefore, at this point of time, this Court is refrained from making any observation with regard to price quoted by petitioner no.1 in respect of various categories of vehicles moved in the State of Odisha. More so, when letter dated 25.11.2016 has not been communicated, no reliance can be placed on the reasons assigned in the said document.
Therefore, this Court is of the considered view that by virtue of subsequent explanation given in the counter affidavit, the order dated 28.11.2016 in Annexure-1 communicated to petitioner no.1 cancelling the tender in question, without assigning any reason, cannot sustain in the eye of law. 29
17. Much reliance has been placed by the learned Advocate General on Afcons Infrastructure Ltd. (supra), in support of posing the question of maintainability on account of non-joinder of parties. In paragraph-18 of the said judgment, the apex Court held that it would be more appropriate for the constitutional Courts to insist on all eligible bidders being made parties to the proceedings filed by the unsuccessful or ineligible bidder. Petitioner no.1 before this Court is neither an unsuccessful nor an ineligible bidder so as to implead any other unsuccessful bidders who have participated in the tender process, nor M/s. Shimnit Utsch India Private Limited has filed an application to be impleaded as a party and participate in the proceeding. It is an admitted fact that pursuant to tender notice dated 04.05.2015 inviting bids, four bidders participated in the tender process and of them the tender committee rejected the bids of two bidders and only petitioner no.1 and M/s. Shimnit Utsch India Private Limited remained in the fray, and ultimately petitioner no.1's case was recommended to the Government for final approval. Since no work order was issued in its favour, even though petitioner no. 1 was the successful bidder in the process of tender, it has approached this Court in the instant writ 30 petition. In view of such position, there is no need to implead any other bidders as parties to the proceeding. More so, in view of the provisions contained under Order-1 Rule-9 CPC, preliminary objection with regard to non-joinder of party should have been raised at the earliest point of time, and that question had to be decided first. It is not out of place to mention that, though the provisions of Order-1, Rule-9 have no application to the proceeding under Article 226 of the Constitution of India, the principle may apply. Apparently, no such plea has been taken by the State in its counter affidavit that the writ application is liable to be dismissed on the ground of non-joinder of parties. Therefore, this Court is of the considered view that at the fag end of the hearing, the question of maintainability of writ petition for non- joinder of parties cannot sustain in the eye of law.
18. Mr. S.P. Mishra, learned Advocate General contended that pursuant to tender notice dated 04.05.2015 petitioner no.1 having remained as single tenderer, in absence of real competition, the State Government has got power to cancel the tender in view of Clause-4.9.1 of the bid documents. 31
In support of such contention, reliance has been placed on M/s. CWE-SOMA Consortium (supra). In paragraph-14 of the said judgment, the apex Court held as follows:
"14. The State derives its power to enter into a contract under Article 298 of the Constitution of India and has the right to decide whether to enter into a contract with a person or not subject only to the requirement of reasonableness under Article 14 of the Constitution of India. In the case in hand, in view of lack of real competition, the State found it advisable not to proceed with the tender with only one responsive bid available before it. When there was only one tenderer, in order to make the tender more competitive, the tender committee decided to cancel the tender and invited a fresh tender and the decision of the appellant did not suffer from any arbitrariness or unreasonableness."
There is no dispute with regard to the law laid down by the apex Court, but each case has to be decided on its own facts. In the instant case, pursuant to tender call notice issued on 04.05.2015, four bidders had participated and of them the bids of two bidders having been rejected, there was a competition between two remaining bidders. On evaluation made by the tender committee, petitioner no.1 having offered the lowest price, its case was recommended to the Government for approval. Even though by virtue of Clause-4.9.1 of the bid documents the Government reserved its right and is empowered to summarily accept or reject any or all of the proposals without assigning any 32 reason, that power cannot be exercised arbitrarily or unreasonably. Therefore, the contention raised, that petitioner no.1 being a single tennderer the action has been taken for cancellation of tender notice in question, is contrary to the materials available on record itself. Consequentially, such ground cannot sustain.
19. Reliance was also placed by the learned Advocate General on the judgment rendered by this Court in W.P.(C) No. 22315 of 2016 (Debabrata Samal v. State of Odisha), which was dismissed on 09.05.2017 referring to M/s CWE-SOMA Consortium (supra) and also M/s Kalinga Order Supplier v. State of Orissa, 2014 (I) ILR-CUT 382 on the ground of single tender. But if the facts of the aforesaid cases are taken into consideration, the same are totally different from that of the present one, where four bidders were participated in the tender process and of them, two having been disqualified, the competition remained between two tenderers, and petitioner having offered lowest price, its case was recommended to the Government by the tender committee, which is expert in the field of awarding tender, for approval, and the same should not have been lightly interfered with. In that view of the matter, case of 33 petitioner no.1 cannot be construed to be that of a single tenderer, so as to apply the ratio decided in the above mentioned cases.
20. It is apt to mention here that a tender is an offer. It is something which invites and is communicated to notify acceptance. It must be unconditional; must be in the proper form, the person by whom tender is made must be able to and willing to perform his obligations. The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. However, a limited judicial review may be available in cases where it is established that the terms of the invitation to tender were so tailor-made to suit the convenience of any particular person, with a view to eliminate all others from participating in the bidding process. The bidders participating in the tender process have no other right, except the right to equality and fair treatment in the matter of evaluation of competitive bids offered by interested persons in response to notice inviting tenders in a transparent manner and free from hidden agenda. The Authority has the right not to accept the highest bid and even to prefer a tender other than the highest bidder, if there exist good and sufficient reasons, such as, the 34 highest bid not representing the market price, but there cannot be any doubt that the authority's action in accepting or refusing the bid must be free from arbitrariness or favouritism. Therefore, invoking Clause 4.9.1 of the bid document for cancelling the tender has to be examined on the touchstone of the arbitrariness, unfairness and unreasonableness of the exercise of power by the State authority. The authority cannot exercise its power at its caprice and whims arbitrarily and unreasonably to deprive a legitimate bidder whose case has been recommended to the Government for approval and allotment of the work.
21. Further contention raised, that in the interest of the public the cancellation of tender dated 04.05.2015 has been done, is absolutely a misconceived statement. It is of relevance to note that the provisions of CMV Rules, 1989 were amended in the year 2001 and consequentially 2001 Order and HSRP Scheme were framed, and thereafter the apex Court issued several directions for compliance of the same. Although in the meantime ten years have elapsed, the State Government has been issuing tender notices and cancelling the same from time to time. When the tender floated on 04.05.2015 was at the final stage, the same has been rejected on the basis of un-communicated reasons, in order 35 to just frustrate the direction issued by the apex Court. Though by filing the interim application time was sought by the State to comply with the direction given by the Supreme Court to implement the HRSP Scheme in consonance with the provisions of MV Act, 1988 and CMV Rules, 1989, as well as 2001 Order, a deliberate attempt has been made by the State Government not to implement the same for some reason or the other, which is tell- tale from the factual matrix available on record. This Court expresses its displeasure on the action of the authorities, which, instead of complying with the directions of the apex Court, have been issuing tender notices and also cancelling the same time and again.
22. The scope and power of the Court to interfere with a contractual matter is well justified in various judgments of the apex Court, namely, Tata Cellular v. Union of India, AIR 1996 SC 11; Master Marine Service (P) Ltd. v. Metcafe & Hodgkinson (P) Ltd., (2005) 6 SCC 138; Sterling Computers Ltd. v. M & N Publications Ltd., (1993) 1 SCC 445; M/s. B. S. N. Joshi and Sons Ltd v. Nair Coal Services Ltd., AIR 2007 SC 437; Reliance Airport Developers (P) Ltd. v. Airports Authority 36 of India, (2006) 10 SCC 1; Siemens Public Communication Networks Private Limited (supra).
23. In M/s Star Enterprises (supra), the apex Court in paragraph 10 of the judgment held as follows:
"10. In recent times, judicial review of administrative action has become expansive and is becoming wider day by day. The traditional limitations have been vanishing and the sphere of judicial scrutiny is being expanded. State activity too is becoming fast pervasive. As the State has descended into the commercial field and giant public sector undertakings have grown up, the stake of the public exchequer is also large justifying larger social audit, judicial control and review by opening of the public gaze; these necessitate recording of reasons for executive actions including cases of rejection of highest offers. That very often involves large stakes and availability of reasons for actions on the record assures credibility to the action; disciplines public conduct and improves the culture of accountability. Looking for reasons in support of such action provides an opportunity for an objective review in appropriate cases both by the administrative superior and by the judicial process. The submission of Mr Dwivedi, therefore, commends itself to our acceptance, namely, that when highest offers of the type in question are rejected reasons sufficient to indicate the stand of the appropriate authority should be made available and ordinarily the same should be communicated to the concerned parties unless there be any specific justification not to do so."
24. In M/s Kamadhenu Cattle Feeds Industries (supra), the apex Court in paragraph 7 of the judgment ruled as follows: 37
"7. In contractual sphere as in all other State actions, the State and all its instrumentalities have to conform to Art, 14 of the Constitution of which non- arbitrariness is a significant facet. There is no unfettered discretion in public law: A public authority possesses powers only to use them for public good. This imposes the duty to act fairly and to adopt a procedure which is 'fairplay in action'. Due observance of this obligation as a part of good administration raises a reasonable or legitimate expectation in every citizen to be treated fairly in his interaction with the State and its instrumentalities, with this element forming a necessary component of the decision-making process in all State actions. To satisfy this requirement of non-arbitrariness in a State action, it is, therefore, necessary to consider and give due weight to the reasonable or legitimate expectations of the persons likely to be affected by the decision or else that unfairness in the exercise of the power may amount to an abuse or excess of power apart from affecting the bona fides of the decision in a given case. The decision so made would be exposed to challenge on the ground of arbitrariness. Rule of law does not completely eliminate discretion in the exercise of power, as it is unrealistic, but provides for control of its exercise by judicial review."
25. In Mahabir Auto Stores (supra), the apex Court observed in paragraph 12 of the judgment as follows:
"12. It is well settled that every action of the State or an instrumentality of the State in exercise of its executive power, must be informed by reason. In appropriate cases, actions uninformed by reason may be questioned as arbitrary in proceedings under Article 226 or Article 32 of the Constitution. Reliance in this connection may be placed on the observations of this Court in M/ s. Radha Krishna Agarwal v. State of Bihar, (1977) 3 S.C. 457: (AIR 1977 SC 1496). It appears to us, at the outset, that in the facts and circumstances of the case, the respondent-company 38 IOC is an organ of the State or an instrumentality of the State as contemplated under Article 12 of the Constitution. The State acts in its executive power under Article 298 of the Constitution in entering or not entering in contracts with individual parties. Article 14 of the Constitution would be applicable to those exercises of power. Therefore, the action of State organ under Article 14 can be checked. See M/s. Radha Krishna Agarwal v. State of Bihar at p. 462 (at SCC) : (at p. 1499-1500 of AIR) (supra), but Article 14 of the Constitution cannot and has not been construed as a charter for judicial review of State action after the contract has been entered into, to call upon the State to account for its actions in its manifold activities by stating reasons for such actions. In a situation of this nature certain activities of the respondent company which constituted State under Article 12 of the Constitution may be in certain circumstances subject to Article 14 of the Constitution in entering or not entering into contracts and must be reasonable and taken only upon lawful and relevant consideration, it depends upon facts and circumstances of a particular transaction whether hearing is necessary and reasons have to be stated.
In case any right conferred on the citizens which is sought to be interfered, such action is subject to Article 14 of the Constitution, and must be reasonable and can be taken only upon lawful and relevant grounds of public interest. Where there is arbitrariness in State action of this type of entering or not entering into contracts, Article 14 springs up and judicial review strikes such an action down. Every action of the State executive authority must be subject to rule of law and must be informed by reason. So, whatever be the activity of the public authority, in such monopoly or semi-monopoly dealings, it should meet the test of Article 14 of the Constitution. If a Governmental action even ,in the matters of entering or not entering into contracts, fails to satisfy the test of reasoned ableness, the same would be unreasonable. In this connection reference may be made to E. P. Royappa v. State of Tamil Nadu, (1974) 4 SCC 3 : (AIR 1974 SC 555); Maneka Gandhi v.
Union of India, (1978) 1 SCC 248: (AIR 1978 SC 597), Ajay Hasia v. Khalid Mujib Sehravardi, (1981) 1 SCC 39 722: (AIR 1981 SC 487); R. D. Shetty v. International Airport Authority of India, (1979) 3 SCC 489: (AIR 1979 SC 162) and also Dwarkadas Marfatia and Sons v. Board of Trustees .of the Port of Bombay, (1989) 3 SCC 293 : (AIR 1989 SC 1642). It appears to us that rule of reason and rule against arbitrariness and discrimination, rules of fair play and natural justice are part of the rule of law applicable in situation or action by State instrumentality in dealing with citizens in a situation like the present one. Even though the rights of the citizens are in the nature of contractual rights, the manner, the method and motive of a decision of entering or not entering into. a contract, are subject to judicial review on the touchstone of relevance and reasonableness, fair play, natural justice, equality and non-discrimination in the type of the transactions and nature of the dealing as in the present case."
Similar view has also been taken in D.K. Engineering and M/s B.M.P. & Sons Pvt. Ltd. (supra).
In view of the law discussed above, this Court observed that the rights of citizens are in the nature of contractual rights, the manner, the method and motive of a decision of entering or not entering into a contract, are subject to judicial review on the touchstone of relevance and reasonableness, fair play, natural justice, equality and non-discrimination in the type of the transactions and nature of the dealing, as in the present case. Therefore, this Court has every justified reason to exercise the power of judicial review in the present context. 40
26. In course of hearing, this Court sought instructions with regard to steps taken pursuant to the tenders invited on 03.03.2017. Mr. S.P. Mishra, learned Advocate General, on having received instructions, brought to the notice of this Court that only pre-bid meeting has been held and no action has been taken pursuant to such fresh tender notice dated 03.03.2017, and that three months time has been sought for to carry out the tender process for implementation of HSRP Scheme in Odisha in compliance of the judgment of the apex Court. As such, no material progress has taken place on record to substantiate such contention.
27. In view of the factual and legal analysis made above, this Court is of the considered view that the action taken by the State opposite parties is arbitrary, unreasonable and contrary to the provisions of law. Therefore, the order dated 28.11.2016 in Annexure-1 issued by the Addl. Commissioner, Transport (Technical), State Transport Authority, Odisha, Cuttack, as well as letter no. 8290 dated 25.11.2016 in Annexure-B of Commerce & Transport (Transport) Department, Government of Odisha (not communicated), cannot sustain in the eye of law. Accordingly, 41 the same are liable to be quashed and are hereby quashed. The consequential fresh tender notice dated 03.03.2017 in Annexure- 2 is also hereby quashed and the opposite parties are directed to proceed with the tender notice floated on 04.05.2015 and finalize the same, as expeditiously as possible, preferably within a period of one month, hence in order to comply with the direction of the apex Court for implementation of HSRP Scheme in Odisha.
28. The writ petition is thus allowed. There shall be no order as to cost.
Sd/-
(VINEET SARAN) CHIEF JUSTICE Sd/-
(DR. B.R. SARANGI) JUDGE Orissa High Court, Cuttack The 8th September, 2017, GDS/Alok/Ajaya True Copy Sr. Secretary