Bangalore District Court
M/S Abhay Solvents Private Limited vs Karnataka Cooperative Milk Producers ... on 11 June, 2024
1
Com.O.S.No.13/2022
KABC170000262022
IN THE COURT OF THE LXXXVII ADDL. CITY CIVIL
& SESSIONS JUDGE (EXCLUSIVE COMMERCIAL
COURT): BENGALURU CITY. (CCH-88)
Present: Smt. Roopa K.N., B.Sc., LL.B.,
LXXXVII Addl.City Civil &
Sessions Judge, Bengaluru.
Dated this the 11th day of June 2024
Com.O.S. No.13/2022
PLAINTIFF : M/s. Abhay Solvents Private Limited,
A-004, Mantri Greens,
No.1, Sampige Road,
Malleshwaram,
Bengaluru - 560003.
Having its administrative office at
Sy. No. 284/2,
Hospet Road,
Koppal - 583 231.
Represented by its Managing Director.
(By Sri K.G. Kamath - Advocate)
2
Com.O.S.No.13/2022
-Vs-
DEFENDANTS : 1. Karnataka Co-operative Milk Producers
Federation Ltd.
KMF Complex, Dr. M.H. Marigowda
Road, Bengaluru - 560 029.
Represented by its Managing Director.
2. Managing Director
Karnataka Co-operative Milk Producers
Federation Ltd.
KMF Complex,
Dr.M.H.Marigowda Road,
Bengaluru - 560 029.
3. Director (Purchase)
Karnataka Co-operative Milk Products
Federation Ltd.
KMF Complex,
Dr. M.H. Marigowda Road,
Bengaluru - 560 029.
4. National Co-operative Dairy Federation
of India Limited,
Having its Head Office at :
National Co-operative Dairy Federation
of India Limited,
Post Box.79, Anand 388 001.
Gujarat, India.
Also having its Area Office at
National Co-operative Dairy Federation
of India Limited
IDA House, Sector, IV,
R.K.Puram,
New Delhi - 110 022.
3
Com.O.S.No.13/2022
India.
Represented by its Director.
(By Sri YPG - Advocate)
Date of Institution of the 03.01.2022
suit
Nature of the suit (suit on Recovery of money
pronote, suit for declaration
& Possession, Suit for
injunction etc.)
Date of commencement of 18.08.2022.
recording of evidence
Date on which judgment 11.06.2024.
was pronounced
Total Duration Year/s Month/s Day/s
01 09 24
(Roopa K.N.)
LXXXVII Addl. City Civil & Sessions Judge,
(Exclusive Commercial Court),
Bengaluru City.
4
Com.O.S.No.13/2022
JUDGMENT
This suit is filed by the plaintiff against the defendant for recovery of EMD amount of Rs.18,79,395/- with interest at the rate of 15% p.a.
2. Brief Facts of the plaintiff case is that;
It is the case of the plaintiff that, plaintiff is in the business of Solvent Extraction and also one of the recognized customers from whom the De Oiled Rice Bran (DORB) is purchased by various entities, as a cattle feed in the State of Karnataka. The plaintiff is engaged in the manufacturing of 100% pure refined rice bran oil. Defendant No.1 is a company providing dairy products. The 2nd defendant is the managerial person of the 1st defendant.
3. The plaintiff has sold DORB to the 1st defendant for the last 25 years in respect of several places such as, Gubbi, Rajanukunte, Hassan, Dharwad and Shikaripura. In the beginning of 2019 the 1st defendant had sought to produce raw-materials i.e., DORB for Shikaripura Unit through e- tender as well as Online through 4th defendant. The said 5 Com.O.S.No.13/2022 tender commenced on 04.02.2019 and the last date of submission of bid was on 05.03.2019. In respect of the tender issued by the 4th defendant the last date for submission of tender was on 06.03.2019. Plaintiff submitted its bid to the 1st defendant on 05.03.2019 through e-procurement Online Portal and to the 4th defendant on 06.03.2019. The plaintiff paid Rs.42,06,000/- towards the Earnest Money Deposit to the defendant on 02.03.2019 by way of RTGS. However, due to typographical error the price was quoted as Rs.1,500/- per tonne in respect of bid submitted to 1st defendant instead of quoting Rs.15,000/- per tonne. Immediately this fact was brought to the notice of defendant Nos.1 to 3 by way of sending e- mail dtd:15.03.2019 wherein plaintiff intimated defendant Nos.1 to 3 about this typographical error. Anyhow 1st defendant did not allowed the plaintiff to rectify the typographical error nor responded to the e-mail sent by him. Apart from this defendant accepted the tender of the other bidder and issued purchase order No.386 dtd:18.03.2019. Upon coming to know this fact plaintiff again sent an e-mail on 19.03.2019 to defendant Nos.1 to 3 and requested for refund of the EMD. Despite this defendants neither allowed the plaintiff to rectify the typographical error in mentioning the amount nor refunded the entire EMD amount. Anyhow 6 Com.O.S.No.13/2022 on 03.04.2019 1st defendant transferred Rs.31,66,000/- in favor of the plaintiff through RTGS by withholding remaining Rs.10,40,000/- out of the EMD amount paid by the plaintiff. Later, plaintiff made several requests and demands to the defendant Nos.1 to 3 to repay the amount of Rs.10,40,000/- but defendants did not repaid the same. Hence, plaintiff filed the present suit for recovery of Rs.10,40,000/- with interest at the rate of 15% p.a. The suit claim is total sum of Rs.18,79,395/-.
4. Defendant No.3 who is the Director of KMF filed written statement denying the averments of the plaint and inter-alia contended that, plaintiff participated in the bid by knowing all conditions of the tender notification and hence, he is bound to follow the same. It is further contended that, as per clause 13.7 of the tender notification in case of a successful tenderer, if the tenderer fails to sign the contract, the security deposit paid by the tenderer is liable to be forfeited and for this reason defendants have forfeited the tender amount of Rs.10,40,000/-. According to 3rd defendant since the bid amount of the plaintiff was the lowest, same was accepted and purchase order was issued to the plaintiff dtd:22.03.2019. Since the plaintiff failed to sign the contract and refused to supply 500 MT of De Oiled 7 Com.O.S.No.13/2022 Rice Bran at the rate of agreed amount of Rs.1,500/-, defendants have forfeited the amount. In view of this, defendant sought for dismissal of the suit.
5. On the basis of the pleadings, this Court has framed the following issues:
ISSUES
1. Whether the plaintiff proves that defendants are not justified in forfeiting the payment of earnest money deposit?
2. Whether the plaintiff further proves that the defendants have manipulated the allotment of tender?
3. Whether the plaintiff proves that defendants withhold the earnest money deposit without any reason?
4. Whether the plaintiff proves that 1st defendant has not paid an amount of Rs.10,40,000/- out of Rs.42,06,000/- paid by the plaintiff?
5. Whether the plaintiff proves that the 1st defendant is liable to pay of Rs.18,79,395/- with interest at 15% p.a.?
6. Whether the plaintiff further proves that the defendants are jointly and severally liable to 8 Com.O.S.No.13/2022 pay of Rs.5,00,000/- as compensation to the plaintiff?
7. Whether defendants prove that 1st defendant has undergone huge loss by being the prevented from the benefit of the lowest rate offered by the plaintiff to the supply De-oiled rice bran?
8. Whether the defendants prove that plaintiff had breached the terms of contract in tender notification?
9. What order or Decree?
ADDITIONAL ISSUE
1. Whether the 1st to 3rd defendants prove that it has issued and provided the plaintiff with the purchase order bearing P.O.No. 416, bearing reference No. KMF/CFRM-345/2018-19 dated 18.03.2019?
6. The plaintiff in order to prove the issues has examined its authorized representative as P.W.1 and got marked the documents as Ex.P.1 to P.19. The defendants in order to prove its case examined its Joint Director as D.W.1 and got marked the documents at Ex.D.1 to Ex.D.14.
9Com.O.S.No.13/2022
7. Heard the arguments on both side.
8. My findings on the above issues are as under:
Issue No.1 to 4 : In the "Affirmative"
Issue No.5 : "Partly in the Affirmative"
Issue No.6 : In the "Negative"
Issue No.7 & 8 : In the "Negative"
Addl. Issue No.1 : In the "Negative"
Issue No.9 : As per final order, for the
following;
REASONS
9. Issue No.1 to 5 and ADDL. ISSUE NO.1: As these
issues are interrelated, they are taken up together for common discussion to avoid repetition of facts and evidence.
In order to prove its case one Hemanth Mehatha, Authorized signatory of plaintiff company examined himself as P.W.1 and got marked Exs.P.1 to 19, his affidavit filed in lieu of chief examination is a replica of plaint averments. Ex.P.1 is the tender notification dtd:02.02.2019, Ex.P.2 is the auction notice, Ex.P.3 is the financial bid details, Ex.P.4 purchase order dtd:18.03.2019, Ex.P.5 is a purchase order 10 Com.O.S.No.13/2022 said to have issued in favour of the plaintiff, Ex.P.6 is also a purchase order bearing No.383 dtd:18.03.2019. Ex.P.9 is the Board Resolution, Ex.P.19 is the legal notice issued by the plaintiff, Ex.P.8 is the reply legal notice issued by the defendants, Ex.P.12 is the bank statement of plaintiff, Ex.P.7, 10 to 18 are the e-mail and letters issued by the plaintiff to defendants and vice-versa. On the other hand, one Dr.K.G.Gopalakrishna, Joint Director of KMF examined himself as D.W.1 and he got marked Exs.D.1 to D.14. His affidavit is replica of averments of written statement. Ex.D.1 is the tender notification similar to Ex.P.1. Ex.D.7 is the purchase order dtd:18.01.2019 Ex.D.5 is an another purchase order dtd:18.03.2019, Ex.D.11 is a purchase order issued in favour of the plaintiff dtd:18.03.2019, Ex.D.2 to D.4, Ex.D.9 to D.14 are the copies of e-mails and letters exchanged between plaintiff and the defendants. Ex.D.8 is the authorized letter issued by the defendants in favour of the D.W.1 to give evidence in this case.
10. The learned counsel for plaintiff while addressing his arguments submitted to the court that, it was a typographical error while mentioning the amount of bid as Rs.1,500/- instead of Rs.15,000/- and defendants knowing fully well that, plaintiff is doing business with them from 11 Com.O.S.No.13/2022 last 25 years did not allowed the plaintiff to rectify the error nor refunded the amount. According to plaintiff Ex.D.10 which is said to be a purchase order issued by the defendants is a fraudulent one as the plaintiff immediately after coming to know about the typographical error communicated the same to the defendants through e-mail but, knowing fully well about this fact they simply sent an e-mail which now the defendants name it as purchase order. Further, he drawn the attention of this court to Ex.P.5 which is a e-mail dtd:22.02.2019 which the defendant claims to be a purchase order issued in favour of the plaintiff which do not contain the number of purchase order nor the conditions and signature of the auditor and it was sent to the plaintiff on 22.02.2019 at about 5.03 p.m. Plaintiff further argued on Ex.D.11 which is a purchase order bearing No.416 dtd:18.03.2019 which according to plaintiff is a full fledged purchase order but it do not bear the seal and sign of the auditor and in Ex.D.11 dtd:18.03.2019 defendants have surprisingly mentioned "confirmation mail dtd:22.03.2019" the counsel for plaintiff expressed his surprise as to how it was possible for the defendants to mention about confirmation e-mail dtd:22.03.2019 on 18.03.2019 itself according to him the defendants intentionally not made refund of Rs.10,40,000/-
12Com.O.S.No.13/2022 towards the EMD amount paid by the plaintiff regarding supply of goods to Shikaripura Unit and hence, plaintiff is entitled for recovery of the suit claim amount. These similar facts have been narrated by the plaintiff in his written argument. Hence, same is not re-iterated.
11. Counsel for defendants 1 to 3 while addressing his arguments admitted that, it is true that, plaintiff has paid Rs.10,40,000/- towards EMD amount pertaining to Shikaripura Unit and plaintiff knowing fully well about the bid amount mentioned the same as Rs.1,500/- and since it was the lowest amount, bid of the plaintiff was accepted and purchase order was issued. Later, plaintiff in order to escape from his liability to supply the products took a contention that, it was a typographical error in mentioning the bid amount as Rs.1,500/- instead of Rs.15,000/-. According to defendants as soon as they accepted the bid amount raised by the plaintiff they issued purchase order but the plaintiff failed to produce the product and in turn through e-mail he requested the defendants to refund the Earnest amount which is not permissible under clause 13.7 of tender notification and defendants legally forfeited the EMD amount as per the above clause of the tender notification. Accordingly, defendants sought for dismissal of the suit.
13Com.O.S.No.13/2022
12. If we carefully peruse the oral and documentary evidence adduced by both plaintiff and defendants, Ex.P.1 and D.1 are the tender notification dtd:21.06.2012 which is an admitted document by both the parties and under this notification dtd:02.02.2019 defendant invited tenders from eligible tenderer for supplying raw-materials for various units like Gubbi, Rajanukunte, Dharwad, Hassan, Shikaripur Cattle Feed Plants and the the tenderer whose bit will be accepted were suppose to deliver the agreed products and goods to the defendants within the stipulated period. It is the specific case of the plaintiff that, he was one of the tenderer who filed an appl and raised bid and his bid was accepted by the defendants but, in reality the original bid amount which was suppose to be was mentioned Rs.15,000/- but, in the application filed by the plaintiff through Karnataka Public Procurement Portal the amount was wrongly mentioned as; Rs.1,500/- instead of Rs.15,000/-. The entire case revolves amount the fact as to whether there was typographical error on the part of plaintiff in mentioning this amount or whether the plaintiff has accepted the tender for Rs.1,500/- and not for Rs.15,000/- it is an admitted fact that, this alleged tender Ex.P.1 was called by the defendants for the supply of various types of goods for various units as mentioned above 14 Com.O.S.No.13/2022 and plaintiff being one of the bidder who participated in the tender agreed to supply the goods and mentioned his bid amount in the e-portal as mentioned in Ex.P.3 which is an admitted document. Whether, the amount is shown as Rs.1,500/- per tonne for supplying DORB for Shikaripura Unit. If we carefully peruse Ex.P.3, it is a copy of contents of Dashboard which consists item vice financial bid details. If we peruse Ex.P.3 the plaintiff who participated in the tender vide tender No.KMF-CFRM-345-2018-19 supply of Cattle Feed raw-material and this plaintiff who was a tenderer filed his application through e-portal for supply of goods to the Cattle Feed Plants of Rajanukunte, Gubbi, Dharwad, Hassan and Shikaripura. If we further peruse the amount mentioned for all the Cattle Feed Plants except Shikaripura the same shows as follows;
CFP Rajanukunte 3000 MT Unit Rate Rs.15,000/-
CFP Gubbi 1500 MT Unit Rate Rs.14,500/- CFP Dharwad 2200 MT Unit Rate Rs.14,100/- CFP Hassan 8500 MT Unit Rate Rs.15,450/- CFP Shikaripura 5000 MT Unit Rate Rs.1,500/-
13. Ex.P.4 is said to be a purchase order No.386 issued by the defendants in favour of M/s.Sri.V.S.Sudhiksha Solvent 15 Com.O.S.No.13/2022 Industries, Koppal under which the very same defendants accepted the bid of this M/s.Sri.V.S.Sudhiksha Solvent Industries for the same Shikaripura CFP wherein the quantity mentioned was 5000 MT and the bid amount was Rs.14,390/-, according to defendants immediately after accepting the bid of the plaintiff they issued Ex.P.5 which is a purchase order bearing No.416 on 22.03.2019. Ex.P.6 is a purchase order pertaining to CFP Gubbi. Ex.P.7 is an e- mail dtd:15.03.2019 sent by the plaintiff to the purchase officer of KMF under which plaintiff informed the defendants that due to typographical error instead of mentioning the unit price for Shikaripura Rs.15,000/- the amount was wrongly mentioned as; Rs.1,500/- and through that e-mail plaintiff requested the defendants to consider the price as Rs.15,000/- / PMT instead of Rs.1,500/- pertaining to Shikaripura Unit. Again on 19.03.2019 plaintiff sent another e-mail to the defendants as per Ex.P.11 under which he requested the defendants to consider the typographical error and requested to return the EMD amount. Ex.P.13 letter dtd:19.03.2019, Ex.P.14 letter dtd:22.03.2019, Ex.P.16 and 17 letters dtd:03.04.2019 and 15.04.2019 are addressed to defendants under which plaintiff requested for refund of EMD amount. Ex.P.18 is an e-mail sent by the plaintiffs to the defendants under which 16 Com.O.S.No.13/2022 plaintiff asked explanation to the defendants as to under which terms and conditions they have withheld the EMD amount of Rs.10,40,000/- . In this regard plaintiff has adduced evidence through P.W.1 and P.W.1 has been duly cross examined by learned counsel for defendants. P.W.1 in his cross examination admitted that, tender was called by defendant Nos.1 to 3 as per Ex.P.1 and after knowing the entire contents of tender notification he gave his declaration as per Ex.D.6. He also admitted that, tender was called in respect of Shikaripura plant and the requirement was DORB of 500 MT he also admitted that, in the said declaration amount has been shown as Rs.1500/- but, he deposed that, it should have been Rs.15,000/- and even in Ex.P.3 the total amount has been wrongly mentioned as Rs.75,00,000/-. He denied that, plaintiff was the lowest bidder. According to him, the lowest bidder from one Shiraguppa factory and their bid amount was Rs.14,200/- - Rs.14,300/-. He further denied issue of purchase order by the defendants on 18.03.2019 itself. According to him Ex.P.5 dtd:22.03.2019 which was sent to him through e- mail is not of purchase order but, it is only information. He further admitted that, he did not supplied the goods to the defendants as he sought for refund of EMD amount. He further admitted that, defendants have 17 Com.O.S.No.13/2022 returned Rs.31,66,000/- towards supply of goods to other CFP. According to him, plaintiff never received purchase order from the defendant. He also admitted that, in clause 13.7 of tender notification it has been mentioned as to in what circumstances EMD has to be forfeited. He also deposed that, he did not received purchase order on 21.03.2019 through e-mail pertaining to Gibbi Plaint but, thereafter he admitted one document marked as Ex.D.14 according to him Ex.P.5 is not a complete purchase order. He further deposed that, purchase order was issued to L.1 M/s.Sri.V.S.Sudhiksha for Rs.14,100/- he also admitted that, before defendants sending purchase order he sought for refund of EMD mount on 19.03.2019 itself. Except this, nothing much has been elicited from P.W.1. Similarly, if we peruse the evidence of defendants D.W.1 in his cross examination admitted about the process of calling e-tender and the related factors. He admitted that, in Ex.P.1 quantity of 500 MT which is shown is the highest quantity and he also admitted that, for 1 unit 2 lowest bidders if bid then tender will be equally distributed amongst such lowest bidder. He also admitted that, in Ex.D.10 the plaintiff shown lowest bidders 1, 2 and 3. He further admitted that, after his verification purchase order will be placed before the Director and before the Director issues purchase order, the 18 Com.O.S.No.13/2022 Manager has to approve the same and before issuing purchase order it should be verified by the auditor and it is true that, without the signature of the auditor no purchase order will be sent to anyone. He also admitted that, purchase order will be sent by giving numbers in a Chronological order and Ex.D.1 was issued on 18.03.2019. According to him before 18.03.2019 itself they sent purchase order through e-mail marked as Ex.P.5 on 22.03.2019 at 5.00 p.m. He has not produced e-mail sent earlier to Ex.P.11. He further admitted that, on 19.03.2019 itself plaintiff issued e-mail and intimated about typographical error in mentioning the bid amount and requested for refund of EMD. He also admitted that, plaintiff was suppose to deliver the goods on 01.04.2019. According to him since plaintiff did not delivered the goods in time they gave the tender to M/s.Sri.V.S.Sudhiksha Solvent Industries as per Ex.D.5 and 7. He also admitted that, said tender was issued to M/s.Sri.V.S.Sudhiksha Solvent Industries on 18.03.2019 itself and in Ex.D.10 name of L.2 M/s.Sri.V.S.Sudhiksha Solvent Industries is not at all shown. He further admitted that, purchase order number mentioned in Ex.D.7 is 386 and purchase order number mentioned in Ex.D.11 to 416. He further admitted that, the amount that has been withheld by the defendants 19 Com.O.S.No.13/2022 i.e., Rs.10,40,000/- is towards non supply of goods to Shikaripura Unit. He also admitted that, in Ex.D.10 date on which this amount was forfeited has not been mentioned and Ex.D.11 has not been cancelled.
14. If we carefully peruse the oral and documentary evidence adduced by both the plaintiff and defendants it is an undisputed fact that, e-tender was called by the defendants from the tenderer for supply of cattle feeds to their various units including Shikaripura and it is also not in dispute that, plaintiff was a successful bidder and he filed his final bid details as per Ex.P.3. It is also true that, in Ex.P.3 it has been submitted by the plaintiff through e- portal bid amount for 5000 M.T. is shown as Rs.1,500/- to supply of DORB to CFP Shikaripura and the amount in words is shown as Rs.75,00,000/-. Now, the court has to ascertain whether plaintiff has successfully proved that, there was a typographical error in mentioning the bid amount as shown in Ex.P.3. defendant never disputed the fact that, plaintiff is a long term tenderer from last 25 years he was supplying the requisite goods to the defendants. If we carefully peruse Ex.P.3 it can be clearly seen that, a bid amount pertaining Rajanukunte, Gubbi, Dharwad, Hassan were clearly shown as Rs.15,100, Rs.14,500/-, Rs.14,100/-, 20 Com.O.S.No.13/2022 Rs.15,450/- but, the amount shown for unit is Rs.1,500/-. It is quite difficult to believe the version of defendants that, plaintiff quoted the lowest price for Shikaripura unit i.e., for Rs.1,500/- when plaintiff has quoted amount around Rs.14,000/- to Rs.15,500/- for other units as soon as the tender was accepted plaintiff when came to know about this typographical error they brought the same to the notice of defendants by sending the e-mail on 15.03.2019 itself as per Ex.P.10 under which plaintiff has intimated the defendants about this typographical error and required the defendants to consider the price of the tender for Shikaripura Unit as Rs.15,000/- PMT and similar e-mails were sent to defendants on 19.03.2019 under which plaintiff required for reconsider the amount and refund of Rs.10,40,000/- . If we carefully peruse Ex.P.10 which is a e-mail sent by the plaintiff to the purchase officer of KMF, it was sent on 15.03.2019 at about 5.14 p.m. and Ex.P.11 another e-mail sent to defendants was on 19.03.2019 and by sending these 2 mails plaintiff duly intimated the defendants about the typographical error while mentioning the amount. In spite of this, very shockingly defendants have sent Ex.P.5 and Ex.P.6 which are the 2 purchase orders. If we peruse these 2 purchase orders, Ex.P.6 is a purchase order dtd:18.03.2019 bearing purchase order 21 Com.O.S.No.13/2022 No.383 and Ex.P.5 is an email dtd:22.03.2019 sent by the defendants at 5.03 p.m. and in the said mail it has been mentioned as; "please find below the purchase order details for ..... accordingly" and the purchase order number mentioned as 416 and purchase order issued in favour of M/s.Sri.V.S.Sudhiksha Solvent Industries was dtd:18.03.2019 bearing purchase order No.386. D.W.1 in his cross examination has categorically admitted that, purchase order number will be issued on Chronological order. If we peruse Ex.D.11 which is an official purchase order dtd:18.03.2019 it bears the terms and conditions, signature of the purchase Director of KMF but, it do not bear the signature of pre auditor. One question which remained unanswered by the defendant is that, when on 15.03.2019 itself plaintiff brought the notice of the defendants about the typographical error why Ex.D.11 was issued on 18.03.22019 and what made the defendants to again issue a 2nd purchase order by way of e-mail on 22.03.2019 as per Ex.P.5. Ex.P.5 do not consists any terms and conditions of purchase order nor the signature of Director of purchase and the auditor. Another important point to be noted is; in Ex.D.11 purchase order dtd:18.03.2019 defendants have mentioned 5 references out of which the 5th one reads as follows; "confirmation e-mail 22 Com.O.S.No.13/2022 dtd:22.03.2019" as rightly argued by the counsel for plaintiff it is surprising fact as to how these defendants had a dream about the e-mail said to have been sent to plaintiff on 22.03.2019 i.e., 4 days after issuance of Ex.D.11. This shows the fraud committed by the defendants in sending these purchase orders knowing fully well about the typographical error committed by the plaintiff while mentioning the bid amount for Shikaripura Unit. If at all the defendants were fair enough on their part, they could have produced the previous tender documents to show that, even earlier to Ex.P.1 when earlier tenders were called plaintiff has quoted similar lessor amount of Rs.1,500/- for any units. The fact that, plaintiffs immediately informed the defendants about the typographical error itself can be a proof and no further proof can be accepted by the court. Apart from this, plaintiff is a bidder for other 4 units along with Shikaripura . When plaintiff has rightly quoted his amount for other 4 units, how could he quote such a lessor amount for only Shikaripura unit?. These facts clearly goes to show that, plaintiff was right in informing the defendants that, there was typographical error. Apart from this, another fact needs to be given much importance is that, on 18.03.2019 the 1st purchase order was issued in favour of the plaintiff as per Ex.P.6 and as per Ex.P.5 2nd purchase 23 Com.O.S.No.13/2022 order was issued on 22.03.2019.l Ex.P.4 which is an admitted document by the defendant is a purchase order bearing No.386 has been issued by the defendants in favour of M/s.Sri.V.S.Sudhiksha Solvent Industries on 18.03.2019 itself. If we peruse Ex.P.4 and Ex.D.11 these two are 2 different orders dtd:18.03.2019 which shows on 18.03.2019 defendants issued Ex.D.11 in favour of plaintiff accepting his tender and on the same day they issued Ex.P.4 in favour of M/s.Sri.V.S.Sudhiksha Solvent Industries. How 2 different purchase orders came to be issued in favour of both plaintiff and M/s.Sri.V.S.Sudhiksha Solvent Industries never answered by the defendants. It is the specific contention of the defendants that, since plaintiff did not supplied the goods as per the tender notification they issued the purchase order for the 2nd lower bidder i.e., M/s.Sri.V.S.Sudhiksha Solvent Industries. The learned counsel for plaintiff rightly drawn the attention of this court to Ex.D.10 which is an e-procurement document which consists the name and details of 3 bidders in respect of Ex.D1 i.e., (1) Praveen Mehta (Abhay Solvent Pvt. Ltd.,) i.e., plaintiff (2) G.Rajesh, (3) Rakesh Kumar. Name column of evaluators remarks it is mentioned as; accepted (Shikaripura EMD at Rs.10,400/- forfeited) this Ex.D.10 is a electronic document but, the date on which the said 24 Com.O.S.No.13/2022 amount was forfeited is not at all mentioned and shockingly name of M/s.Sri.V.S.Sudhiksha Solvent Industries is not at all found along with above bidders including the plaintiff. When such being the case how the said tender was issued in favour of M/s.Sri.V.S.Sudhiksha Solvent Industries when his bid was not at all accepted is a question never explained before this court by the defendants nor defendants prodcued any document to show this M/s.Sri.V.S.Sudhiksha Solvent Industries was also a bidder along with the plaintiff and his bid amount was lessor than the others. Apart from this, if we further peruse Ex.D.10 out of 3 bidders the defendants have accepted the bid of plaintiff and rejected the bid of G.Rajesh and Rakesh Kumar who were L.2 and L.3 . If at all the purchase orders were to be issued other than the plaintiff, the defendants ought to have issued the same in favour of either L.2 or L.3 which they never issued and without having any proof they have issued purchase order in favour of M/s.Sri.V.S.Sudhiksha Solvent Industries. Even the defendants could have examined any person from this M/s.Sri.V.S.Sudhiksha Solvent Industries to prove how purchase order was issued in their favour. No such person has been examined. Both plaintiff and defendants have relied on tender notification 25 Com.O.S.No.13/2022 marked as Ex.P.1 and D.1. defendants relied on clause 13.0, 13.5, 13.6, 13.7 which reads as follows;
13.4 Any tender not secured in accordance with ITT Clauses 13.1 and 13.3 above will be rejected by the Purchaser as non-responsive, pursuant to ITT Clause 22.
13.5 Unsuccessful Tenderer's earnest money deposit will be discharged / returned as promptly as possible but not later than 30 days after the expiration of the period of tender validity prescribed by the Purchaser, pursuant to ITT Clause 14.
13.6 The successful Tenderer's earnest money deposit will be discharged upon the Tenderer signing the Contract, pursuant to ITT Clause 30, and furnishing the performance security, pursuant to ITT Clause 31.
13.7 The tender security may be forfeited:
(a) if a Tenderer (I) withdraws its tender during the period of tender validity specified by the Tenderer on the Tender Form; or (ii) does not accept the correction of errors pursuant to ITT Clause 22.2;26
Com.O.S.No.13/2022 or
(b) in case of a successful Tenderer, if the Tenderer fails:
(i) to sign the Contract in accordance with ITT Clause 30; or
(ii)to furnish performance security in accordance with ITT Clause 31.
15. I have carefully perused the above clause of tender notification and also clause No.22.2 which deals with arithmetical errors and the notification has made it clear that, if there is a discrepancy between the unit price and the total price i.e., obtained by multiplying the unit price and quantity, unit price shall prevail and the total price shall be corrected. If there is a discrepancy between words and figures, the lowest of the 2 will prevail. If the supplier does not accept the corrections, errors, its tender will be rejected and its tender security may be forfeited apart from mentioning this nowhere in the tender notification there is a mention about any clause dealing with other type of arithmetical errors like what happened in the present case. Anyhow, if we peruse clause No.13.7 it deals with circumstances tenderer does not accept the corrections of errors. In the present case plaintiff honestly accepted his 27 Com.O.S.No.13/2022 mistake in mentioning the bid amount and it was duly intimated to the defendants immediately when the plaintiff came to know about the typographical error. The conduct of defendants in issuing 2 different purchase orders despite knowing the fact about this error compels the court draw adverse inference against the defendants. Further, issuing purchase order in favour of M/s.Sri.V.S.Sudhiksha Solvent Industries on the same day when purchase order was issued in favour of plaintiff also creates a doubt in the mind of the court regarding the conduct of defendants. All these facts clearly goes to show that, plaintiff was clear on his part in informing the defendants about the typographical error and the defendants who is doing business with the plaintiff from last 2 decades though aware about the manner in which plaintiff was conducting the business with all awareness accepted the bid amount of Rs.1,500/- though other bid amount for other units were for more than Rs.14,000/- these facts shows that, plaintiff has successfully proved that, there was typographical error while mentioning the bid amount for Shikaripura Unit and on the other hand, defendants who were very well aware of this fact neither accepted the mistake of the plaintiff nor made the refund of Rs.10,40,000/- which is an EMD 28 Com.O.S.No.13/2022 deposited by the plaintiff towards the Shikaripura Unit from 15.03.2019 till this date.
16. The learned counsel for plaintiff along with written arguments relied on decisions rendered by Hon'ble Apex Court held between Union of India .Vs. Vertex Broadcasting Company Ltd. This decision is in respect of forfeiture of EMD amount. On the other hand, the learned counsel for defendant was also relied on decision rendered by Hon'ble Apex Court held in (2015)4 SCC 252 national Thermal power Corporation Ltd. Vs. Ashok Kumar Singh. This decision also relating to forfeiture of EMD. I have carefully perused these 2 decisions. Any how, in the decision relied by the plaintiff in para 9 Hon'ble Apex Court has observed when the EMD amount ash to be forfeited. Since the facts and circumstances in both these cases differs from the case in hand, these decisions could not be relied upon.
17. The learned counsel for plaintiff further argued that, legal notice was issued to the defendant on 03.10.2019 as per Ex.P.19 which is an admitted document, no reply was given by the defendants which shows defendants have admitted the claim of the plaintiff. It is true that, no reply notice was given by the defendant to Ex.P.19 which compels 29 Com.O.S.No.13/2022 this court to draw adverse inference against the conduct of defendants.
18. In view of all these facts, I hold plaintiff has proved issue No.1 to 4. Coming to the question of issue No.5 plaintiff has claimed interest of 15% p.a. on the suit claim. Since there is no contractual rate of interest agreed between the parties payable in case of default by anyone of them plaintiff is entitled for interest at the rate of 12% p.a. Accordingly, I answer issue Nos.1 to 4 in the "AFFIRMATIVE" and issue No.5 "PARTLY IN THE AFFIRMATIVE" and Addll. Issue No.1 in the "NEGATIVE".
19. ISSUE NO.6:- In para 24 of the plaint plaintiff has given a description of the suit claim amount and in Sl.No.4 he has sought for compensation of Rs.5,00,000/-. If we peruse the plaint averments no pleadings are there in respect of claiming this compensation of Rs.5,00,000/- and plaintiff has not explained to the court as to why this court has to award this amount as compensation. When such being the case plaintiff has not entitled for compensation of Rs.5,00,000/-. Accordingly, issue No.6 is answered in "NEGATIVE".
30Com.O.S.No.13/2022
20. ISSUE NO.7 AND 8 - While discussing issue Nos.1 to 4 this court has already observed as to how these defendants have played fraud on the plaintiff and issued purchase orders both to plaintiff and M/s.Sri.V.S.Sudhiksha Solvent Industries on the very same day. In my opinion it is the plaintiff who is suffering loss not the defendants as on 18.03.2019 itself defendants have issued tender in favour of M/s.Sri.V.S.Sudhiksha Solvent Industries. Further plaintiff was clear enough to accept the typographical error and intimated the same to defendant on 15.03.2019 itself when such being the case question of plaintiff violating the terms of tender notification does not arise. When such being the case what was the loss caused by the plaintiff to the defendants is not at all explained. Hence, I answer issue Nos.7 and 8 in "NEGATIVE" and pass following;
21. ISSUE NO.9:- In view of my findings to issue Nos.1 to 9 and additional Issue No.1 as stated above, I proceed to pass the following;
ORDER The suit of the plaintiff is decreed with cost. The plaintiff is entitled for recovery of Rs.10,40,000/- with interest at the rate of 12% p.a. from the date of suit till the date of realization.
31Com.O.S.No.13/2022 Defendants are hereby directed to refund Rs.10,40,000/- with interest at the rate of 12% p.a. to the plaintiff within 3 months from the date of decree.
Draw decree accordingly.
(Dictated to the Stenographer online, typed by her, corrected and then pronounced by me in open Court on this the 11th day of June, 2024).
(Roopa K.N.) LXXXVII Addl. City Civil & Sessions Judge, (Exclusive Commercial Court), Bengaluru City.
ANNEXURE
1. LIST OF WITNESSES EXAMINED ON BEHALF OF THE PLAINTIFF PW-1 Sri Hemanth Mehta.
2. LIST OF DOCUMENTS EXHIBITED ON BEHALF OF THE PLAINTIFF Ex.P1 Tender Notification No. LFT No. KMF/CFRM-
32Com.O.S.No.13/2022 345/2018-19 dtd: 02.02.2019.
Ex.P2 Auction Notice. Ex.P3 Financial bid details Ex.P4 Purchase order bearing no. dtd: 18.03.2019 Ex.P5 Purchase order favouring the plaintiff. Ex.P6 Purchase order favouring the plaintiff. Ex.P7 E-Mail dtd: 07.06.2019. Ex.P8 Notice reply dtd: 10.01.2020. Ex.P9 Board Resolution
Ex.P10 E-Mail sent by Plaintiff to Defendant.
Ex.P11 Copy of e-mail dtd: 19.03.2019.
Ex.P12 Bank Statement with certificate of u/sec. 65(b).
E-Mail dated 19.03.2019 identified by Plaintiff Ex.P13 to the Defendant.
Letter dated 22.02.2019 by plaintiff to the Ex.P14 defendant.
Ex.P15 Courier receipt.
Ex.P16 Letter dtd: 03.04.2019 by plaintiff to defendant.
Letter dtd: 15.04.2019 by plaintiff to the Ex.P17 defendant.
33Com.O.S.No.13/2022 Email dtd: 07.06.2019 sent by plaintiff to the Ex.P18 defendant.
Ex.P19 Legal notice dtd: 03.10.2019.
3. LIST OF WITNESSES EXAMINED ON BEHALF OF THE DEFENDANTS DW1 Dr. K.G. Gopalkrishna
4. LIST OF DOCUMENTS EXHIBITED ON BEHALF OF THE DEFENDANTS Ex.D1 Tender notification bearing No.IFT No.KMF/CFRM-345/2018-19 dated 02.02.2019 Ex.D2 E-mail correspondence dated 19.03.2019 Ex.D3 Letter dated 22.03.2019 from plaintiff to defendant No.3 requesting to cancel purchase order Ex.D4 Letter dated 03.04.2019 from plaintiff to KMF Ex.D5 Purchase order dated 18.03.2019 from KMF L2 bidder clarification Ex.D6 Dashboard dated 28.10.2022 34 Com.O.S.No.13/2022 Ex.D7 Purchase order dated 18.01.2019 Ex.D8 Authorization letter Ex.D9 Online copy of tender notification dated 02.02.2019 with 65(B) certificate Ex.D10 Online copy of e-procurement item wise revolution of financial bid Ex.D11 Purchase order dated 18.03.2019 identified by KMF in favour of plaintiff Ex.D12 Letter identified by plaintiff in favour of defendant No.1 dated 03.04.2019 Ex.D13 E-mail dated 07.06.2019 sent by KMF to the plaintiff with 65(B) certificate Ex.D14 Purchase orders dated 21.03.2019 (Roopa K.N.) LXXXVII Addl. City Civil & Sessions Judge, (Exclusive Commercial Court), Bengaluru City.