Karnataka High Court
Beldar Basha Sab vs The Principal Secretary on 1 June, 2023
Author: S G Pandit
Bench: S G Pandit
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WA No. 100277 of 2023
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 1ST DAY OF JUNE, 2023
PRESENT
THE HON'BLE MR JUSTICE S G PANDIT
AND
THE HON'BLE MR JUSTICE VIJAYKUMAR A.PATIL
WRIT APPEAL NO. 100277 OF 2023 (GM-TEN)
BETWEEN:
BELDAR BASHA SAB
AGED ABOUT 60 YEARS,
S/O HUSSAIN PEER SAB
R/O HARPANHALLI VILLAGE AND TALUK,
FORMERLY DAVANGERE DISTRICT
PRESENTLY VIJAYANAGAR DISTRICT
...APPELLANT
(BY SRI. MAHESH WODEYAR, ADVOCATE)
VIJAYALAKSHMI
M KANKUPPI
AND:
Digitally signed by
VIJAYALAKSHMI M
KANKUPPI 1. THE PRINCIPAL SECRETARY
Location: High Court of
Karnataka, Dharwad
Date: 2023.06.21 13:25:20 DEPARTMENT OF FOOD AND CIVIL SUPPLIES
+0530
NO.29, GROUND FLOOR,
VIKAS SOUDHA,
DR. B.R.AMBEDKAR VEEDHI
BENGALURU-560001
2. THE COMMISSIONER FOR FOOD AND CIVIL SUPPLIES
5TH FLOOR, MARKETING FEDERATION BUILDING
CUNNINGHAM ROAD,
BANGALORE-560052
3. THE DEPUTY COMMISSIONER
VIJAYANAGAR DISTRICT
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WA No. 100277 of 2023
HOSPET
4. MALLIKARJUN S/O BASAPPA
MAJOR, PROPRIETOR
GOWTHAM TRANSPORT
MANVI TALUK
RAICHUR DISTRICT
...RESPONDENTS
(SRI. CHETAN MUNNOLI, ADVOCATE FOR C/R4;
SRI. V.S.KALASURMATH, HCGP FOR R1 TO R3)
THIS WRIT APPEAL IS FILED U/S.4 OF KARNATAKA HIGH
COURT ACT, 1961, PRAYING THIS HON BLE COURT TO, SET ASIDE
THE ORDER OF THE LEARNED SINGLE JUDGE DATED 31.03.2023
PASSED IN W.P.NO.106041/2022, AND ALLOW THE WRIT APPEAL
DIRECTING THE SECOND RESPONDENT TO CONSIDER THE TENDER
SUBMITTED BY THE APPELLANT IN THE PLACE OF RESPONDENT
NO.4.
THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY,
VIJAYKUMAR A. PATIL, J., DELIVERED THE FOLLOWING:
JUDGMENT
This intra-court appeal has been filed assailing the order dated 31.03.2023 passed by the learned single Judge in W.P.No.106041/2022 (GM-TEN), by which writ petition preferred by the appellant has been dismissed.
2. The brief facts giving rise to filing of this appeal are, the appellant has invoked writ jurisdiction under Article 226 of Constitution of India, seeking prayer to -3- WA No. 100277 of 2023 quash the work order dated 08.11.2022 issued by the third respondent - Deputy Commissioner, Vijayanagar District; to quash order dated 04.11.2022 passed by the second respondent - Commissioner for food and civil supplies - the appellate authority and to issue a writ in the nature of mandamus to the second and third respondent to consider the bid of the petitioner for transportation of food grains in respect of Hadagali taluk for the year 2022- 2024.
3. It is averred that, the appellant is the existing contractor transporting food grains on the strength of work order issued in his favour for the last two years i.e. from 2018 to 2020 from the Godown to the Fair Price Depot (FPD), within the jurisdiction of Huvinahadagali taluk. It is averred that, on expiry of the contract period, the duration of the contract were extended from time to time. The second respondent invited the tender vide notification dated 24.12.2021 in two cover system for the transportation of food grains from KFCSC/TAPCMS and -4- WA No. 100277 of 2023 other wholesale Godowns to the Fair Price Depots including loading, unloading and arranging in stack formation in the Fair Price Depot in 179 talukas of 30 districts for 2022-2024.
4. It is further averred that, the respondent No.4 who has participated in the tender process would not fulfill the eligibility conditions terms of the tender notification and he has obtained bogus certificate from private agency namely Mahila Pooraka Nutrition Food Production Centre, Haravi, Manvi taluk, Raichur district and submitted to meet the eligibility criteria at Condition No.4 (ii) of the Tender document. It is also averred that, the certificate obtained and produced by the fourth respondent along with the tender document is issued by the society which did not have annual turn over of more than Rs.75 lakhs and if such certificate is rejected he cannot be termed as a L1. Admittedly, he does not fulfill the required condition, however, the committee headed by the second respondent has considered the bid of fourth respondent -5- WA No. 100277 of 2023 and rejected the bid of the petitioner on the ground that, his bid is on higher side. When the appellant came to know that the bid of the fourth respondent has been wrongly accepted and his bid was rejected, he has filed appeal before the second respondent and also submitted representation dated 27.10.2022 to the appellate authority requesting to reject the tender of the fourth respondent. The appellate authority has passed non-speaking order on 04.11.2022 confirming the decision of the committee. It is also averred that, the appellant had approached the first respondent by submitting the representation requesting him not to finalize the tender process. The authorities without considering the appeal on merits and without considering the representations, awarded the work in favour of the fourth respondent knowing fully well that, he does not fulfill the eligibility criteria and ignoring the fact that, the appellant was transporting the food grain till this date.
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5. The respondents have filed their objections denying the averments of the writ petition. It is averred that the second respondent has invited the tender which is two cover system for transportation of food grains from wholesale godown to the Fair price depots in the entire State of Karnataka. It is further averred that the tender evaluation committee in its meeting held on 06.09.2022 evaluated all the bids and approved the technical bid of the respondent No.4. Feeling aggrieved by the decision of the technical committee, the appellant approached the appellate authority by preferring an appeal and after hearing and on detailed consideration the appellate authority has dismissed the appeal preferred by the petitioner on 04.11.2022. Since the fourth respondent is a successful bidder, the respondent No.3 has issued the work order to him on 08.11.2022. It is also averred that, the respondent No.4 fulfills the eligibility criteria. The respondent No.4 has an experience of transporting food grains to the society namely Mahila Pooraka Poushtika Aahar Utpadana Kendra, Haravi, for three years and the -7- WA No. 100277 of 2023 said society is registered under the provisions of Karnataka Societies Registration Act, 1960 and the said society had turn over of more than Rs.6.50 Crores for 2018-19, 2019-20 and 2020-21 and the copies of the certificate are placed before the evaluation committee. Hence, it fulfills all the requisite conditions of tender and sought for dismissal of the writ petition. The respondent Nos.1 to 3 have not filed any statement of objections. Learned Single Judge after hearing the parties, was pleased to dismiss the writ petition. In the aforesaid factual background, this appeal has been filed.
6. Learned counsel Sri. Mahesh Wodeyar, appearing for the appellant submits that the learned single Judge has erred in interpreting clause 4 of the eligibility criteria of the tender document. It is submitted that, the experience certificate obtained and produced by the fourth respondent is not of a society registered or under the Companies Act, 1956 and it is of the society which is registered under the Karnataka Societies Registration Act -8- WA No. 100277 of 2023 and on the other hand, the experience certificate has not been obtained from the society as required under the condition. Therefore, the eligibility criteria having not fulfilled by the fourth respondent, the learned single Judge ought to have allowed the writ petition on this ground.
7. It is further submitted that, the learned single Judge has erred in appreciating the document placed before it by the fourth respondent at Annexure-D1 which is a certificate issued in favour of the fourth respondent who has supplied the commodities every year i.e. 2018- 19, 2019-20 and 2020-21 to the tune of Rs.9,03,000/-, Rs.9,15,000/- and Rs.9,23,500/- totaling to Rs.27,41,500/- which does not satisfy the requirement of eligibility criteria condition No.4(ii) which requires the annual turn over of Rs.75 lakhs. He also submits that, the appellate authority has not assigned any reason whatsoever while dismissing the appeal filed by the appellant. The appellate authority as well as the learned Single Judge have not properly appreciated the material -9- WA No. 100277 of 2023 on record, hence, sought to interfere in the present appeal.
8. Per contra, Sri. Chetan Munnoli, learned counsel appearing for respondent No.4 submits that, the learned single Judge has examined the eligibility criteria prescribed in the tender document by comparing with the documents placed by the respondent No.4 and has come to a definite conclusion that the fourth respondent meets the eligibility criteria. It is submitted that, the documents produced by the respondent No.4 at Annexure-D the certificate issued by Manvi taluk, MSPC, Haravi village, document at Annexures-R1 to R4 to the Statement of Objections clearly establishes that the respondent No.4 had experience of transporting six tons and above capacity trucks and have supplied food grains to the society having annual turnover of Rs.75 lakhs. It is further submitted that, the petitioner has failed to establish the fact that, the fourth respondent does not meet the eligibility criteria before the appellate authority as well as before the learned single Judge and
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WA No. 100277 of 2023both the forums have concurrently held that the fourth respondent meets the eligibility criteria and have dismissed the appeal and the writ petition, and does not call for any interference in this appeal. Sri. V.S.Kalasurmath, learned HCGP supports the impugned Judgment of the learned Single Judge and submits that, the appellant has failed to establish that the respondent No.4 has not fulfilled the eligibility criteria, hence, no merit in the appeal and seeks to reject the same.
9. We have heard the learned counsels for the parties, perused the material on record. It would be useful to refer the various decisions of Hon'ble Supreme Court before adverting to the case on hand.
(a) Scope of judicial review :
(i) Tata Cellular Vs. Union of India, reported in (1994) 6 SCC 651. Para Nos. 70, 71 & 77.
"70. It cannot be denied that the principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. However, it must be clearly stated that there are inherent limitations in exercise of that power of judicial review. Government is the guardian of the finances of the State. It is expected to protect the financial interest of the State. The right to refuse the lowest or any other tender is always available to the Government. But, the principles laid
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down in Article 14 of the Constitution have to be kept in view while accepting or refusing a tender. There can be no question of infringement of Article 14 if the Government tries to get the best person or the best or the quotation. The right to choose cannot be considered to be an arbitrary power. Of course, if the said power is exercised for any collateral purpose the exercise of that power will be struck down.
71. Judicial quest in administrative matters has been to find the right balance between the administrative discretion to decide matters whether contractual or political in nature or issues of social policy; thus they are not h essentially justiciable and the need to remedy any unfairness. Such an unfairness is set right by judicial review.
77. The duty of the court is to confine itself to the question of legality. Its concern should be:
1. Whether a decision-making authority exceeded its powers?
2. Committed an error of law,
3. committed a breach of the rules of natural justice,
4. reached a decision which no reasonable tribunal would have reached or,
5. abused its powers.
Therefore, it is not for the court to determine whether a particular policy or particular decision taken in the fulfillment of that policy is fair. It is only concerned with the manner in which those decisions have been taken. The extent of the duty to act fairly will vary from case to case. Shortly put, the grounds upon which an administrative action is subject to control by judicial g review can be classified as under
i) Illegality: This means the decision-maker must understand correctly the law that regulates his decision-making power and must give effect to it.
(ii)Irrationality, namely, Wednesbury unreasonableness.
(iii) Procedural impropriety.
The above are only the broad grounds but it does not rule out addition of further grounds in course of time. As a matter of fact, in R. v. Secretary of State for the Home Department, ex Brind28, Lord Diplock refers specifically to
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WA No. 100277 of 2023one development, namely, the possible recognition of the principle of proportionality. In all these cases the test to be adopted is that the court should, "consider whether something has gone wrong of a nature and degree which requires its intervention".
(ii) Jagadish Mandal Vs. State of Orissa reported in (2007) 14 SCC 517. Paragraph Nos.21 and 22:
21. We may refer to some of the decisions of this Court, which have dealt with the scope of judicial review of award of contracts.
21.1) In Sterling Computers Ltd vs. M & N Publications Ltd [1993 (1) SCC 445], this Court observed :
"While exercising the power of judicial review, in respect of contracts entered into on behalf of the State, the court is concerned primarily as to whether there has been any infirmity in the 'decision making process'...... the courts can certainly examine whether 'decision making process' was reasonable, rational, not arbitrary and violative of Article 14 of the Constitution."
21.2) In Tata Cellular v. Union of India [AIR 1996 SC 11], this Court referred to the limitations relating to the scope of judicial review of administrative decisions and exercise of powers in awarding contracts, thus :
(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 action. 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.
(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...... More often
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than not, such decisions are made qualitatively by experts.
(5) The Government must have freedom of contract. In other words, a fairplay 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 application of Wednesbury principle of reasonableness (including its other facets 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. This Court also noted that there are inherent limitations in the exercise of power of judicial review of contractual powers. This Court also observed that the duty to act fairly will vary in extent, depending upon the nature of cases, to which the said principle is sought to be applied. This Court held that the State has the right to refuse the lowest or any other tender, provided it tries to get the best person or the best quotation, and the power to choose is not exercised for any collateral purpose or in infringement of Article 14.
21.3) In Raunaq International Ltd., vs. I.V.R. Construction Ltd. [1999 (1) SCC 492], this Court dealt with the matter in some detail. This Court held :
"9. The award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision considerations which are of paramount importance are commercial considerations. These would be :
(1) The price at which the other side is willing to do the work;
(2) Whether the goods or services offered are of the requisite specifications;
(3) Whether the person tendering has the ability to deliver the goods or services as per specifications. When large works contracts involving engagement of substantial manpower or requiring
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specific skills are to be offered, the financial ability of the tenderer to fulfil the requirements of the job is also important;
(4) the ability of the tenderer to deliver goods or services or to do the work of the requisite standard and quality;
(5) past experience of the tenderer, and whether he has successfully completed similar work earlier; (6) time which will be taken to deliver the goods or services; and often (7) the ability of the tenderer to take follow up action, rectify defects or to give post contract services.
Even when the State or a public body enters into a commercial transaction, considerations which would prevail in its decision to award the contract to a given party would be the same. However, because the State or a public body or an agency of the State enters into such a contract, there could be, in a given case, an element of public law or public interest involved even in such a commercial transaction.
10. What are these elements of public interest? (1) Public money would be expended for the purposes of the contract; (2) The goods or services which are being commissioned could be for a public purpose, such as, construction of roads, public buildings, power plants or other public utilities. (3) The public would be directly interested in the timely fulfilment of the contract so that the services become available to the public expeditiously. (4) The public would also be interested in the quality of the work undertaken or goods supplied by the tenderer. 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 re-doing the entire work - thus involving larger outlays or public money and delaying the availability of services, facilities or goods, e.g. A delay in commissioning a power project, as in the present case, could lead to power shortages, retardation of industrial development, hardship to the general public and substantial cost escalation.
11. When a writ petition is filed in the High court challenging the award of a contract by a public authority or the State, the court must be satisfied that there is some element of public interest involved in entertaining such a petition. If, for
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WA No. 100277 of 2023example, the dispute is purely between two tenderers, the court must be very careful to see if there is any element of public interest involved in the litigation. A mere difference in the prices offered by the two tenderers may or may not be decisive in deciding whether any public interest is involved in intervening in such a commercial transaction. It is important to bear in mind that by court intervention, the proposed project may be considerably delayed thus escalating the cost far more than any saving which the court would ultimately effect in public money by deciding the dispute in favour of one tenderer or the other tenderer. Therefore, unless the court is satisfied that there is a substantial amount of public interest, or the transaction is entered into mala fide, the court should not intervene under Article 226 in disputes between two rival tenderers."
21.4) In Air India Ltd. vs. Cochin International Airport Ltd [2000 (2) SCC 617], this Court summarized the scope of interference as enunciated in several earlier decisions thus :
"7. The award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision considerations which are paramount are commercial considerations. The State can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. It can enter into negotiations before finally deciding to accept one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to be the highest or the lowest. But the State, its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot 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 by mala fides, unreasonableness and arbitrariness. The State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision-making process the court must exercise its discretionary power under Article 226 with great caution and should exercise it only in
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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."
[Emphasis supplied] 21.5) In Association of Registration Plates vs. Union of India [2005 (1) SCC 679], this Court held:
"....Article 14 of the Constitution prohibits government from arbitrarily choosing a contractor at its will and pleasure. It has to act reasonably, fairly and in public interest in awarding contracts. At the same time, no person can claim a fundamental right to carry in business with the government. All that he can claim is that in competing for the contract, he should not be unfairly treated and discriminated, to the detriment of public interest.."
21.6) In B.S.N. Joshi v. Nair Coal Services Ltd. [2006 (11) SCALE 526], this Court observed :
"56. It may be true that a contract need not be given to the lowest tenderer but it is equally true that the employer is the best judge therefor; the same ordinarily being within its domain, court's interference in such matter should be minimal. The High Court's jurisdiction in such matters being limited in a case of this nature, the Court should normally exercise judicial restraint unless illegality or arbitrariness on the part of the employer is apparent on the face of the record."
22. Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and malafides. 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
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WA No. 100277 of 2023review 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. Therefore, a court before interfering in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions :
i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone.
OR Whether the process adopted or decision made is so arbitrary and irrational that the court can say : 'the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached.'
ii) Whether public interest is affected. If the answers are in the negative, there should be no interference under Article 226. Cases involving black-listing or imposition of penal consequences on a tenderer/contractor or distribution of state largesse (allotment of sites/shops, grant of licences, dealerships and franchises) stand on a different footing as they may require a higher degree of fairness in action.
(b) Writ Court cannot act as an appellate authority over the decision of the experts/Tender scrutiny authority:
(i) National High Speed Rail Corporation Vs. Montecarlo Limited and another, reported in (2022) 6 SCC 401. Para Nos.26, 27 and 28.1:
26. ................However, it is required to be noted that when the author of the tender document, in the present case, JICC/JICA, had taken a conscious decision that the Bid submitted by the respondent - original writ petitioner can be said to be non-responsive and suffering from material deviation, it was not for the High Court to consider/opine whether the Bid submitted by the original writ petitioner is substantially
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responsive Technical Bid or not unless the decision is found to be perverse and/or suffered from mala fides and/or favoritism.
27. At the cost of repetition, it is to be noted that under the contractual obligation, it was not open for the appellant - corporation and/or even the Republic of India to deviate from any of the terms and conditions of the loan agreement and/or the decision of JICC/JICA. Therefore, in absence of any allegation of mala fides/arbitrariness and/or favouritism, we are of the opinion that the High Court has committed a grave error in interfering with a conscious decision taken by the JICC/JICA, which has been followed by the appellant.
28. xxxxxx 28.1. In the case of Afcons Infrastructure Limited Vs. Nagpur Metro Rail Corporation Limited, AIR 2016 SC 4305, this Court in paras 11 to 13 and 15 has observed and held as under
:-
"11. Recently, in Central Coalfields Ltd. v. SLL-SML (Joint Venture Consortium), (2016) 8 SCC 622, it was held by this Court, relying on a host of decisions that the decision-
making process of the employer or owner of the project in accepting or rejecting the bid of a tenderer should not be interfered with. Interference is permissible only if the decision- making process is mala fide or is intended to favour someone. Similarly, the decision should not be interfered with unless the decision is so arbitrary or irrational that the Court could say that the decision is one which no responsible authority acting reasonably and in accordance with law could have reached. In other words, the decision- making process or the decision should be perverse and not merely faulty or incorrect or erroneous. No such extreme case was made out by GYT-TPL JV in the High Court or before us.
12. In Dwarkadas Marfatia and Sons v. Port of Bombay, (1989) 3 SCC 293, it was held that the constitutional courts are concerned with the decision-making process. Tata Cellular v. Union of India, (1994) 6 SCC 651 went a step further and held that a decision if challenged (the decision having been arrived at through a valid process), the constitutional courts can interfere if the
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decision is perverse. However, the constitutional courts are expected to exercise restraint in interfering with the administrative decision and ought not to substitute its view for that of the administrative authority. This was confirmed in Jagdish Mandal v. State of Orissa, (2007) 14 SCC 517, as mentioned in Central Coalfields Ltd. v. SLL-SML (Joint Venture Consortium), (2016) 8 SCC
622.
13. In other words, 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.
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."
(ii) Agmatel India Private Limited Vs. Resoursys Telecom and others, reported in (2022) 5 SCC 362. Para No.25:
25. This Court referred to various decisions on the subject and stated the legal principles as follows: -
"14. In a series of judgments, this Court has held that the authority that authors the tender document is the best person to understand and appreciate its requirements, and thus, its interpretation should not be second-guessed by a court in judicial review proceedings. In Afcons
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Infrastructure Ltd. v. Nagpur Metro Rail Corporation Ltd., (2016) 16 SCC 818, this Court held:
"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."
10. The Hon'ble Supreme Court has laid down the ratio in the cases referred supra. The Judicial review in the matter of tender should be very minimal and Courts should restrain in interfering with the administrative actions insofar as contracts. The Courts should not sit as an appellate authority and review the decision of the experts as Courts does not have expertise in the field of contracts. The Courts are entitle to examine whether any infirmity in the decision making process. The Court can examine whether the decision making process was reasonable, rational and not arbitrary in violation of Article 14 and not the decision as such. Now we advert to the
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WA No. 100277 of 2023reliefs sought by the appellants keeping in mind the law laid down by the Hon'ble Supreme Court referred supra. It is not in dispute that, the second respondent has invited tender vide notification dated 22.12.2021 for the year 2022-2024 in two cover system for transpiration of food grains and other items from KFCSE/TAPCMS/other wholesale godowns to Fair Price Depots including loading, unloading and arranging in stack in Fair Price Depots in 179 talukas of 31 districts through E-Tender platform of the Government of Karnataka. It is also not in dispute that pursuant to the tender notification the appellant as well as the respondent No.4 have participated in the tender process and the Vijaypur District Tender Scrutiny Committee has evaluated all the bids and accepted the bid of respondent No.4. The appellant herein has assailed the evaluation proceeding dated 06.09.2022 before the appellate authority i.e. Commissioner, Food and Civil Supplies, Bengaluru. The appeal was dismissed on 04.11.2022. Being aggrieved by the order of the appellate authority dated 04.11.2022 and the issuance of work
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WA No. 100277 of 2023order dated 08.11.2022 issued in favour of respondent No.4 at Annexure-H, filed the writ petition seeking prayer to quash the orders and sought a prayer to issue writ in the nature of mandamus to the second and third respondent to consider the bid of the appellant for transportation of food grains in respect of Hadagali taluk of Vijayanagar District for the year 2022-2024. The learned single Judge dismissed the writ petition vide order dated 31.03.2023 holding that, the fourth respondent meets the eligibility criteria.
11. Before adverting to the issue in the case on hand, it will be useful to refer the subject minimum eligibility criteria of the Tender document for easy reference:
Clause No.4:
"The Bidders shall possess the following minimum eligibility criteria to participate in this Tender:
(i) xxxxxx
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WA No. 100277 of 2023
(ii) Experience in transportation: The
transporter should have minimum of three years experience in transportation by Six ton and above capacity trucks in government department or corporations/public sector undertaking/public or private ltd companies having annual turnover of Rs.75.00 lakhs and above and registered under company's act 1956 and societies registered under Societies Registration Act. Attested copies of the 3 years experience certificates shall be produced as per (Annexure-IV) from customers evidencing proof of satisfactory execution and completion of the contract
(s) besides duly certifying, nature, period of contract and value of work handled."
12. On careful perusal of the minimum eligibility criteria at Clause 4(ii) of the tender document extracted supra it is evident that the transporter should have minimum three years experience of transportation of food grains in trucks having six tons capacity and the said work should have been carried in the Government Department or corporations/public sector undertaking, public or private limited companies, having annual turn over of Rs.75 lakhs. The said undertaking should have been registered under the Companies Act, 1956, or Society registered under the
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WA No. 100277 of 2023Societies Registration Act and the bidder should produce the certificate evidencing proof of satisfactorily execution of the work and including the value of the work. To meet the said eligibility criteria, the respondent No.4 has produced the copies of the certificate at Annexure-R1, the certificate of registration of Manvi taluk MSPTC under the provisions of Societies Registration Act, 1960, Annexures- R2 to R4 are the balance sheets profit and loss account of the said organization for three years which are certified by the Chartered Accountant and the document at Annexure- D to the writ petition, the certificate for carrying out the volume of work during the said three year. The aforesaid documents evidences that, Manavi taluk MSPTC has a turnover of Rs.1,53,24,947/-, more than the required turnover stipulated in the minimum eligibility criteria. The respondent No.4 has supplied food grains to the said society for three years in the required capacity of trucks. On careful scrutiny of the aforesaid documents, it is very much clear that the successful bidder i.e. respondent No.4 has fulfilled the minimum eligibility criteria at Clause 4(ii).
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WA No. 100277 of 2023The contention of the appellant that, the respondent No.4 where he has carried out transportation business is not a Society registered under the Societies Registration Act, 1960 as required under Clause 4 of the tender document is contrary to material on record and on the other hand a perusal of the document at Annexure-R1 to the Statement of objection filed by the respondent No.4 clearly reveals that it is a Society registered under the Societies Registration Act, 1960. Hence, the said contention has no merit.
13. The learned counsel for the appellant has raised another contention that the appellate authority while deciding the appeal has not assigned any reason while passing the order dated 04.11.2022 and on this ground he has sought to allow the appeal. Before meeting the said contention urged by the learned counsel for the appellant, it will be useful to refer Sections 16 & 13 of the Karnataka Transparency in Public Procurements Act, 1999, which reads as under:
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"16. Appeal - (1) Any tenderer aggrieved by an order passed by the Tender Accepting Authority other than the Government under Section 13 may appeal to the prescribed authority within (fifteen) days from the date of receipt of the order:
Provided that the prescribed authority may, in its discretion allow further time not exceeding (fifteen) days for preferring any such appeal, if it is satisfied that the appellant had sufficient cause for not preferring the appeal in time.
(2) The prescribed authority may after giving opportunity of being heard to both the parties pass such order thereon as it deems fit and such order shall be final.
(3) the prescribed authority shall as far as possible dispose of the appeal within thirty days from the date of filing thereof."
"13. Acceptance of Tender : - The Tender Accepting Authority shall, after following such procedure as may be prescribed pass order accepting the tender and shall communicate the information relating to acceptance of tender together with a comparative analysis and reasons for accepting of tender to the procurement entity and (on the Karnataka Public Procurement Portal):
Provided that where the Tender Accepting Authority consists of single officer who is due to retire within the next six months, from the date fixed for the acceptance for tender, he shall not act to keep the tender without obtaining prior approval of the Procurement Entity:
Provided further that subject to such general or special order as may be issued by the Government from time to time, the Tender Accepting Authority may before passing order accepting a tender negotiate with lowest tenderer."
14. On bare perusal of the extracted Sections supra, it is very much clear that any tenderer aggrieved can invoke the jurisdiction of the appellate authority under Section 16 of the Act, assailing the order passed under Section 13 of the Act. Admittedly, in the instant case the
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WA No. 100277 of 2023appellant has knocked the doors of the appellant authority challenging the tender evaluation proceedings dated 06.09.2022 and not the order passed under Section 13 of the Act by the tender accepting authority. Hence, filing of the appeal by the appellant itself was not maintainable before the appellate authority. Hence, we are of the opinion that, the appellant has not challenged the order of tender accepting authority passed under Section 13 before the appellate authority, hence, appeal was not maintainable.
15. It will be useful to refer the decision of the Hon'ble Supreme Court in the case of Shilppi Constructions Contractors Vs. Union of India and anothers, reported in (2020) 16 SCC 489, at paragraph No.25 it is held as under:
"25. That brings us to the most contentious issue as to whether the learned Single Judge of the High Court was right in holding that the appellate orders were bad since they were without reasons. We must remember that we are dealing with purely administrative decisions. These are in the realm of contract. While rejecting the tender the person or authority inviting the tenders is not required to give reasons even if it be a State within the meaning of
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Article 12 of the Constitution. These decisions are neither judicial nor quasi-judicial. If reasons are to be given agt every stage, then the commercial activities of the State would come to a grinding halt. The State must be given sufficient leeway in this regard. Respondents 1 and 2 were entitled to give reasons in the counter to the writ petition which they have done."
16. Keeping in mind the ratio laid down by the Hon'ble Supreme Court supra, we are of the considered view that, the contention of the appellant that the appellate authority has not assigned any reason while passing the orders on his appeal is required to be rejected.
17. In view of the preceding analysis, we are of the considered view that, the judicial review in the matters of award of tender is very limited and this Court cannot expected to sit as a appellate authority over the decision of the experts/tender evaluation committee/tender accepting authority. Unless the action of the authority is malafide or colorable exercise of power, this Court cannot be sit on the decision of the tender accepting authority and to come to a conclusion that whether the decision is correct or not. In the light of the well settled legal position, we are of the considered view that, there is no
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WA No. 100277 of 2023error in the order of the learned single Judge, which calls for interference in the present appeal. This Court is conscious that, the private interest should make way to the public interest. In the instant case, award of contract in favour of the fourth respondent, is as per law and completion of the tender should be in a time bound manner. Tender in question is in the larger public interest, and if any delay it would affect the public at large. The appellant is one of the participant in the tender process and he has no fundamental right to carry on trade or business with the State or instrumentalities of the State, hence, he cannot claim that tender should be awarded to him only. The learned Single Judge has rightly refused to interfere in the writ petition. We do not find any error in the said decision. Hence we need not go into the legality or otherwise of the order of the appellate authority dated 04.11.2022 in this appeal. Even otherwise, we have considered the case of the appellant on its merits de horse, the fact that the appeal was not maintainable under Section 16 of the Act. Hence, the contention of the
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WA No. 100277 of 2023appellant that the appellate authority has not passed the reasoned order is required to be rejected at the threshold.
For the aforesaid reasons, we do not find any merit in the present appeal. The same fails and hereby dismissed.
Sd/-
JUDGE Sd/-
JUDGE SVH List No.: 1 Sl No.: 5