Gujarat High Court
Hof Furniture System Pvt Ltd & vs State Of Gujarat & 3 on 20 February, 2017
Author: Anant S. Dave
Bench: Anant S. Dave, A.Y. Kogje
C/SCA/19439/2016 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL CIVIL APPLICATION NO. 19439 of 2016
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HOF FURNITURE SYSTEM PVT LTD & 1....Petitioner(s)
Versus
STATE OF GUJARAT & 3....Respondent(s)
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Appearance:
MR BB NAIK SENIOR ADVOCATE WITH MR PARTHIV A BHATT,
ADVOCATE for the Petitioner(s) No. 1 - 2
MR KAMAL TRIVEDI ADVOCATE GENERAL WITH MS SK VISHEN AGP for
the Respondent(s) No. 1 - 3
MR MIHIR JOSHI SENIOR ADVOCATE WITH MR HARDIK P MODH,
ADVOCATE WITH MR AMIT LADDHA ADVOCATE for the Respondent(s) No.
4
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CORAM: HONOURABLE MR.JUSTICE ANANT S. DAVE
and
HONOURABLE MR.JUSTICE A.Y. KOGJE
Date : 20/02/2017
ORAL ORDER
(PER : HONOURABLE MR.JUSTICE ANANT S. DAVE) 1 Heard learned counsels for the parties.
2 Mr. B.B.Naik, learned Senior Advocate appearing for the petitioner, has drawn our attention to the special conditions No.1 and 2 of the NIT for supply, installation and testing of office modular furniture and hostel furniture for projects of project implementation unit across the State of Gujarat and price quoted for the items by the petitioner are Page 1 of 6 HC-NIC Page 1 of 6 Created On Sun Aug 13 15:18:03 IST 2017 C/SCA/19439/2016 ORDER within the parameters of ±25% of estimated rate. However, the offer of general rebate by the petitioner is proportionally divided qua each of the items and the petitioner is disqualified on the ground of non compliance of special conditions No.1 and 2. Mr. Naik, Senior Advocate, further submits that by letter dated 09.11.2016 reasons are assigned for disqualification on the ground of noncompliance of special conditions No.1 and 2 and by subsequent letter dated 25.11.2016 issued by the authority upon representation made by the petitioner, another ground is assigned for disqualification that the tender of the petitioner was nonresponsive as per the special conditions No.1 and 2 of the NIT. It is further submitted that criteria of nonresponsiveness will apply only under the circumstance prescribed in clause 24.4. of NIT. The whole process is undertaken by the authority resulting into disqualification of the petitioner on such grounds is unjust, unreasonable, arbitrary and violative of Articles 14 and 19 of the Constitution of India and accordingly the prayers made in this petition are required to be granted.
3 Mr. Kamal Trivedi, learned Advocate General, appearing for respondent Nos.1 to 3, has placed reliance on interpretation of Special Conditions No.1 and 2 of the NIT visavis amount quoted of Rs.27,34,43,444.7261 by the petitioner after grant of general rebate of 36.5550%, which at the relevant point of time was the lowest price bid and by applying special clauses No.1 and 2, the petitioner is Page 2 of 6 HC-NIC Page 2 of 6 Created On Sun Aug 13 15:18:03 IST 2017 C/SCA/19439/2016 ORDER disqualified of not complying with ±25% of the estimated rate so published and displayed at the notice Board of the PIU office. It is further submitted that after the petitioner is disqualified, in a negotiation with remaining two bidders, respondent No.4 is found lowest and the tender process is to be further carried out accordingly.
3.1 Mr. Kamal Trivedi, learned Advocate General, further submits that to avoid imaginary price hike or otherwise for the items of NIT criteria ±25% is prescribed. By offering general rebate of 36.5550% the petitioner wanted to wriggle out of rigour of conditions No.1 and 2 which are special in nature and made applicable to all bidders and finally negotiation with the respondent No.4 resulted into lowest price bid which is beneficial to the public exchequer. Thus, no case is made out to accept the prayers of the petitioner, who stood disqualified on the ground of noncompliance of conditions No.1 and 2 of NIT.
4 Mr. Mihir Joshi, learned Senior Advocate, appearing for the respondent No.4 would contend that offering general rebate amounts circumventing special condition Nos.1 and 2 and therefore the petitioner is rightly disqualified.
5 Heard learned counsels for the parties and perused the record of the case. For prima facie consideration of the case at this stage, it is profitable to reproduce Special Condition Nos.1 and 2 Page 3 of 6 HC-NIC Page 3 of 6 Created On Sun Aug 13 15:18:03 IST 2017 C/SCA/19439/2016 ORDER of the NIT and clause 24.4 of Preliminary Examination of NIT, which read as under:
Special Condition Nos.1 and 2 of the NIT "NO1 ESTIMATE OF WORK BASED ON SOR PUBLISHED BY ROAD & BUILDING DEPARTMENT GUJARAT WHICH IS OPEN FOR VISUAL INSPECTION OF PROSPECTIVE BIDDERS AT PIU OFFICE. BIDDERS ARE INSTRUCTED TO QUOTE WORKABLE TENDER ITEMS RATES. QUOTING OF UNWORKABLE AND HIGHER TENDER ITEMS RATE ARE LIABLE FOR REJECTION ON THIS REASON.
NO2 PLEASE NOTE SPECIFICALLY THAT QUOTING UNBALANCED TENDER ITEM RATES (±25% OF ESTIMATED RATES) FOR THE PIU WORKS SHALL DISQUALIFY THE BIDDERS FOR AWARDING PIU) CONTRACTS".
Clause 24.4 of Preliminary Examination of NIT "24.4 Prior to the detailed evaluation, pursuant to ITB Clause 26, the Purchaser will determine the substantial responsiveness of each bid to the bidding documents. For purposes of these Clauses, a substantially responsive bid is one which conforms to all the terms and conditions of the bidding documents without material deviations.
Deviations from or objections or reservations to critical provisions such as those concerning Performance Security [GCC Clause 7]. Warranty [GCC Clause 15], Force Majeure [GCC Clause 25], Limitation of Liability [GCC Clause 29], Applicable Law [GCC Clause 31], and Taxes & Duties [GCC Clause 33] will be deemed to be a material deviation. The Purchaser's determination of a bid's responsiveness is to be based on the contents of the bid itself without recourse to extrinsic evidence."
[emphasis supplied] Page 4 of 6 HC-NIC Page 4 of 6 Created On Sun Aug 13 15:18:03 IST 2017 C/SCA/19439/2016 ORDER 5.1 That when price bids were opened on 23.08.2016 the petitioner No.1 was admittedly the lowest bidder and the respondent No.4 was found to be the second lowest bidder. After offer of rebate of 36.5550% the final bid of the petitioner No.1 was Rs.27,34,43,444.7261 while of respondent No.4 was Rs.32.37 crores, who had not offered any rebate. Later on by applying special condition Nos.1 and 2 the petitioner came to be disqualified as per letter dated 09.11.2016 and upon representation vide letter dated 25.11.2016 it was communicated that the tender is non responsive as per the special condition Nos.1 and 2 of NIT.
6 Prima facie, we find that General Rebate offered by the petitioner was not in any manner restricted or prohibited by NIT made applicable to disqualify the petitioner for bringing the same to apply the parameter of ±25% of the estimated rate is arbitrary, unreasonable and discriminatory also resulting into loss to the public exchequer and accordingly we deem it just and proper to grant further stay. The respondent Nos.1, 2 and 3 are restrained from awarding the contract in pursuance of the tender being Tender for Supply, installation and Testing of Office modular furniture and Hostel furniture for projects of Project Implementation Unit across the State of Gujarat being Tender No.218701 [Tender Notice No.2016/17/06/03].
Page 5 of 6HC-NIC Page 5 of 6 Created On Sun Aug 13 15:18:03 IST 2017 C/SCA/19439/2016 ORDER 7 Issue Rule returnable on 14th March, 2017. Learned advocates for the respective respondents have waived service of Rule on behalf of respective respondents.
8 However, it will be open for the respondent Nos.1, 2 and 3 to negotiate or renegotiate the price offered by the parties in accordance with tender conditions other than ±25% estimated rates and in accordance with law.
Direct service is permitted.
(ANANT S.DAVE, J.) (A.Y. KOGJE, J.) pvv Page 6 of 6 HC-NIC Page 6 of 6 Created On Sun Aug 13 15:18:03 IST 2017