Bombay High Court
Cooldeck Industries Pvt. Ltd. Mumbai ... vs The State Of Maharashtra, Thr. ... on 13 December, 2021
Author: Anil L. Pansare
Bench: Sunil B. Shukre, Anil L. Pansare
1 WP.8405-2018.P.odt
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT NAGPUR, NAGPUR.
...
WRIT PETITION NO. 8405 /2018
1) Cooldeck Industries Private Limited
Having its office at Unit No.121
Andheri Industrial Estate
Andheri Industrial Premises
Co-operative Society,
22 Veera Desai Road, Andheri (West)
Mumbai 400 053
Through Its authorized representative
2) Prakash Bhargawa
Aged about 74 years,
Director,
Cool Deck Industries Pvt.Ltd.
R/o 2201, Royal Empire Plot No.37
Shastri Nagar, Lokhandwala
Andheri (W) Mumbai 400 053.
3) Harsh s/o Prakash Bhargawa
Aged about 48 years, Director
Cooldeck Industries Pvt.ltd.
R/o 2201 Royal Empire, Plot No.37
Shastri Nagar, Lokhandwala
Andheri (W), Mumbai 400 053. ..PETITIONERS
{Petitioner Nos. 2 and 3 added vide
Court's Order dated 25.10.21}
versus
1) The State of Maharashtra
Through the Department of
Power & Energy, Mantralaya,
Mumbai 400 032.
2) Maharashtra State Power Generation
Company Limited,
Through its Managing Director
Prakashgarh, Bandra (East)
Mumbai.
2 WP.8405-2018.P.odt
3) Paras Thermal Power Station
Paras, Taluka: Balapur
Dist. Akola
Through its Chief Engineer
4) M/s Akshay Enterprises
Through its Proprietor
having its office at Shraddha Nagar,
Paras Teachers' Colony,
Taluka Balapur Dist.Akola-444109. ..RESPONDENTS
..................................................................................................................
Mr. S.S. Sanyal & Ms. Shiba Thakur, Advocates for petitioner
Mr. G.E. Moharir, Adv. For respondent nos.2 and 3
Mr. Y.D. Nagpure, Advocate for respondent no.4
Mr. A.M. Kadukar, AGP for respondent no.1
.............................................................................................................
CORAM: SUNIL B. SHUKRE &
ANIL L. PANSARE, JJ
DATE OF RESERVING: 28.10.2021
DATE OF PRONOUNCEMENT: 13.12.2021
JUDGMENT:(PER ANIL L. PANSARE, J.)
1. Rule. Rule made returnable forthwith. Heard finally with the consent of respective parties.
2. By means of this petition, the petitioner questions the manner in which the respondents, more specifically, the respondent no.3 has ignored the bid of petitioner. According to the petitioner, the bid of respondent no. 4 does not fulfill the essential criterias' mentioned in the tender details for "supply and installation of spares for NDCT of 3 WP.8405-2018.P.odt 250 MW Unit at Paras Thermal Power Station" (TPS).
3. The petitioner has come up with a case that the respondent no.3 has acted with pre-determined mind-set for allotting the tender to respondent no.4, and therefore, the bid of respondent no.4 has been accepted, despite absence of proper proof of qualifying requirements ("QR" for the sake of brevity). According to the petitioner, the respondent no.3 ought not to have opened the price bid of respondent no.4 as it had not fulfilled the conditions of tender in respect of Techno Commercial bid. Petitioner further claims that he was qualified bidder, however his documents have been ignored. The petitioner accordingly alleges that the act of respondent no. 3 in accepting bid of the respondent no. 4 is mala fide and arbitrary.
4. Having heard both the sides at length, it appears that prior to the present tender process, similar process was undergone under the tender bearing No.75989. The present tender bears No. 78126. The terms and conditions including the QR in both the tenders, were similar. In the previous tender, the petitioner and respondent no.4 had submitted Techno Commercial bids. Both the bids were scrutinized and deviation of tender committee was recorded. As per the deviation, 4 WP.8405-2018.P.odt respondent no.4 submitted requisite documents. However, the petitioner did not. As there was only one qualified agency / proposed tenderer, the tender was refloated for competitive bids that led to calling upon the subsequent tender No.78126. The petitioner and respondent no.4 again participated. According to respondent nos. 2 and 3, the respondent no.4 was qualified and was eligible for opening of its price bid, however the petitioner was not and hence the deviation was communicated to the petitioner calling for necessary documents. The petitioner on 17.11.2018 submitted the same documents as were already submitted, which were not sufficient for fulfilling the QR by the petitioner.
5. The respondent nos. 2 and 3 submit that, earlier when the petitioner was disqualified considering the QR, it did not challenge the disqualification. Therefore, now it is not open for the petitioner to challenge its disqualification with regard to the present tender process, particularly when specifications as well as QR in both the tenders were identical. Emphasis of both the parties is on conditions of contract under Clause 2.1 and QR's which reads as under:
2. Requirement from Tenderers 2.1. The tenderer shall provide satisfactory evidence concerning that:
5 WP.8405-2018.P.odt
a) The TENDERER has proven experience of design, manufac-
ture, testing supply of similar material / equipment, which are in operation on the date of submission of the tender.
b) The TENDERER does not anticipate change in the owner- ship during the proposed period of contract. If such a change is anticipated, the scope effect thereof shall be defined. QUALIFYING REQUIREMENT: (SUPPLY) I) TECHNICAL CONDITIONS
1) The bidder should have 3 years' experience in design, man- ufacture and supply.
2) During the last 3 years bidder should have executed at least single order equal to 25% value of tendered items.
3) This item should have been supplied to State/Central power generating company / Any Other State/Central Government undertaking /Public Sector undertaking of India. II) FINANCIAL / COMMERCIAL CONDITIONS:
1) The bidder should have annual average turnover for last 3 years equal to estimated cost of the tender items.
2)The bidder should produce the copies of statement of An-
nual Accounts for previous three years duly certified by a Chartered Accountant OR produce a certificate of annual turnover during previous three years duly certified by a Chartered Accountant. QUALIFYING REQUIREMENT: (WORK) A. Average annual financial turnover during the last 3 years ending 31st March of the previous financial year should be at least 30% of the estimated cost.
6 WP.8405-2018.P.odt B. Experience of having successfully completed similar works during last 7 years ending last day of month previous to the one in which applications are invited should be either of the following I. Three similar completed works costing not less than the amount equal to 40% of the estimated cost.
Or II. Two similar completed works costing not less than the amount equal to 50% of the estimated cost.
Or III. One similar completed works costing not less than the amount equal to 80% of the estimated cost.
(Similar work Means: Proven experience of mechanical main- tenance work of NDCT or annual maintenance Contract of NDCT in any 200 MW or above capacity unit at MSPGCL/NTPC/ SEB's/Public Sector Undertaking/Central Power Generation Company/ (Approved sub vendor of EPC/Turnkey/ BoT contractor of MAHAGENCO.) C. Bidder should submit the documentary evidence regarding satisfactory performance certificate previously executed similar work contracts.
D. Bidder should have successfully completed the similar na- ture works in MSPGCL/NTPC/SEB's/Public Sector Undertak- ing/Central Power Generation Company/ (Approved sub ven- dor of EPC/Turnkey/ BOT contractor of MAHAGENCO) Bidder must enclose copies of experience/executed work orders.
6. After going through the record, it appears and would also be relevant to mention that, Estimated Cost of the Tender was Rs. 45,76,815/- of which the bifurcation leads to Estimated value of Work 7 WP.8405-2018.P.odt QR towards Rs. 9,00,000/- and Estimated value of Supply QR towards Rs. 36,76,815/-. It also appears from the tender documents that the Tender on the supply part was for items named PVC fills, Asbestos Cement pipes, Asbestos cement couplings and end caps and on work part was for mechanical maintenance work of NDCT (Natural Draught Cooling Tower) or annual maintenance contract of NDCT in any 200MW or above capacity unit.
7. It is the case of the petitioner that he had satisfied the QR and therefore his tender ought to have been accepted inasmuch as his price bid was lower than the price bid quoted by respondent no.4. Despite this, his tender has been rejected and the tender of respondent no.4 has been accepted.
8. Since the petitioner has alleged arbitrary act on part of the respondent nos. 2 and 3 while allotting the tender in favour of respondent no.4 and while rejecting the tender of petitioner, it will be necessary to find out whether the petitioner indeed has tendered the requisite documents.
8. Perusal of the office note concerning deviation (Annexure R-5 to the petition) would show as to why petitioner is found to be 8 WP.8405-2018.P.odt ineligible for opening of his price bid. The QR for supply in tender on the point of financial/commercial conditions, firstly is that the bidder should have annual average turnover for last three years equal to estimated cost of tender items and secondly, that the bidder should produce the copies of statement of annual accounts of previous three years duly certified by a Chartered Accountant or produce a certificate of annual turnover during previous three years duly certified by a Chartered Accountant. The petitioner has not supplied adequate information to that effect. This appears to be one of the essential reasons for disqualification of the petitioner. The report would also show that the petitioner failed to submit necessary documents in respect of the technical conditions, other financial/commercial conditions and QR for work. The respondent no.3 appears to have given an opportunity to the petitioner to submit the documents through deviation letter. The respondent no.3 called upon the petitioner to submit-
(i) details of order qualifying QR for tendered items supply part;
(ii) work details of order along with execution document for similar work portion and
(iii) proof of being manufacturer of tender items or of participating as dealer.
9 WP.8405-2018.P.odt The petitioner vide letter dated 17th November, 2018 admits that it has received tender deviation for submission of documents, but claims that it had already submitted all the required documents as per Tender QR, and resubmitted the documents. Thus, the petitioner did not submit any new document in response to the deviation letter. Furthermore, petitioner has not even clarified as to how it was eligible to be qualified or whether it has adequately responded to the deviation letter.
10. In addition to the above, respondent nos. 2 and 3 have also pointed out as to how the purchase orders submitted by the petitioner do not qualify the QR for supply and QR for works on the basis insufficiency in the purchase orders of the petitioner.
(i) The purchase orders dated 28th April, 2014 and 13th October, 2014 submitted by the petitioner did not qualify under QR for supply as they were not within three years prior to the date of submission of tender date 30th November 2018 in terms of QR supply I-1 and therefore could not be considered. These two Purchase orders did not even qualify under QR for work regarding experience of mechanical maintenance work of NDCT or annual maintenance Contract of NDCT 10 WP.8405-2018.P.odt in any 200 MW or above capacity unit [Refer QR for work- B as the purchase orders were only for supply and not work.
(ii) The purchase order dated 12th August, 2016 was for supply of only PVC fills and not for Asbestos Cement pipes, Asbestos cement couplings and end caps thereby not qualifying under QR for supply for remaining items. It did not even qualify under QR for work regarding experience of mechanical maintenance work of NDCT or annual maintenance Contract of NDCT in any 200 MW or above capacity unit in terms of QR for work- B as the purchase order was only for supply and not work.
(iii) Purchase orders dated 13th July 2018, 14th March, 2017, 29th December, 2017 were for supply of only PVC fills with installation and not for Asbestos Cement pipes, Asbestos cement couplings and end caps thereby not qualifying under QR for supply for remaining items. It did not even qualify under QR for work regarding experience of mechanical maintenance work of NDCT or annual maintenance Contract of NDCT in any 200 MW or above capacity unit in terms of QR for work - B as the purchase order is only for installation of PVC fills.
(iv) Purchase order dated 4th April,2018 was only for supply of asbes- tos cement pipes and not for Asbestos cement couplings, end caps thereby not qualifying under QR for supply for remaining items. It did not even qualify under QR for work regarding experience of mechanical maintenance work of NDCT or annual maintenance Contract of NDCT in 11 WP.8405-2018.P.odt any 200 MW or above capacity unit in terms of QR for work - B as the purchase order is only for supply of asbestos cement pipes.
11. As per Respondent no. 2 and 3 all the above purchase orders submitted by the petitioner did not qualify the QR for supply as they did not cover the items namely end caps and cement couplings. Furthermore, they did not even meet the QR for work requiring experience for work-B, which conclusion we find to be in consonance with the QR of the tender in question.
12. On the point of acceptance of tender of respondent no.4, the respondent no.2 and 3 have referred to following documents:
(i) Purchase order dated 24th May 2017 qualifies QR for supply for end caps, Asbestos cement pipes and Asbestos cement couplings
(ii) Purchase order dated 2nd May 2017 qualifies QR for supply for PVC fills for Rs. 16,15,597/-.
Both the documents would show that items were delivered at the respective destination. Thus, it covers the items required to be supplied and also qualify QR for supply of 3 years. The requirement under QR Supply I (2) for purchase orders is to the tune of 25% of value of tendered items i.e. 25% of Rs.36,76,815 = 9,19,204. The above documents indicate experience of supply required under QR 12 WP.8405-2018.P.odt Supply I(2).
(iii) Purchase order dated 13th August 2014 for annual maintenance contract for NDCT unit 250 MW of Rs. 15,05,734 qualifies the QR for work with regard to experience for similar works during last 7 years as mentioned in "QR Work B". It also qualifies QR for work with regard to one similar completed works costing not less than the amount equal to 80% of the estimated cost i.e., 80% of Rs. 9,00,000/- (Estimated cost of work) = Rs. 7,20,000/- as mentioned in "QR B. III".
13. The respondent no. 4 has also filed certificate of manufacturers, M/s ZEMKAL for Plastic Industrial Component, i.e., PVC fills and M/s ARL Infratech Ltd. manufacturer of asbestos pipes and components. Thus, Respondent No. 4 had established eligibility as per QR for supply part.
14. The above justification for accepting tender of respondent no. 4 and rejecting tender of petitioner appears to us to be in accordance with the tender conditions.
15. Learned counsel for the petitioner has also argued that there was no scope for issuance of deviation in view of clause no.27 of 13 WP.8405-2018.P.odt the tender. This clause is under the head 'ambiguity in quotation or deviations' and provides that the tenderer shall ensure that his quotation should quote the tender in clear terms and that there shall be no deviation in respect of the terms specified in clause 27. One of the terms is non-compliance of special conditions specified. It is accordingly, argued that if the petitioner had not submitted the requisite documents, the deviatikon ought not to have issued to him, which according to petitioner, has been done to avoid retender and thus to favour the respondent no.4.
16. On the point of deviation, the petitioner has relied upon the judgment rendered by the Hon'ble Supreme Court in the case of Reliance Energy Limited vs. Maharashtra State Board Development Corporation Ltd. and others, reported in (2007) 8 SCC 1. The emphasis is on paragraph 38 and 39 which read as under:
"38. When tenders are invited, the terms and conditions must indicate with legal certainty, norms and benchmarks. This "legal certainty" is an important aspect of the rule of law. If there is vagueness or subjectivity in the said norms it may result in unequal and discriminatory treatment. It may violate doctrine of "level playing field".
14 WP.8405-2018.P.odt "39. In the case of Reliance Airport Developers (P) Ltd. v. Airports Authority of India and others -(2006) 10 SCC 1, the Division Bench of this Court has held that in matters of judicial review the basic test is to see whether there is any infirmity in the decision-making process and not in the decision itself. This means that the decision-maker must understand correctly the law that regulates his decision- making power and he must give effect to it otherwise it may result in illegality. The principle of "judicial review" cannot be denied even in contractual matters or matters in which the Government exercises its contractual powers, but judicial review is intended to prevent arbitrariness and it must be exercised in larger public interest. Expression of different views and opinions in exercise of contractual powers may be there, however, such difference of opinion must be based on specified norms. Those norms may be legal norms or accounting norms. As long as the norms are clear and properly understood by the decision-maker and the bidders and other stakeholders, uncertainty and thereby breach of rule of law will not arise. The grounds upon which administrative action is subjected to control by judicial review are classifiable broadly under three heads, namely, illegality, irrationality and procedural impropriety. In the said judgment it has been held that all errors of law are jurisdictional errors. One of the important principles laid down in the aforesaid judgment is that whenever a norm/benchmark is prescribed in the tender process in order to provide certainty that norm/standard should be clear. As stated above "certainty" is an important aspect of rule of law. In the case of Reliance Airport Developers (supra), the scoring system formed part of the 15 WP.8405-2018.P.odt evaluation process. The object of that system was to provide identification of factors, allocation of marks of each of the said factors and giving of marks had different stages. Objectivity was thus provided."
17. In our view, the aforesaid judgment will be of no help to the petitioner inasmuch as the facts before the Hon'ble Supreme Court were altogether different. The petitioner therein had challenged the disqualification by the respondent which was on the basis of the account statement submitted by the petitioner. The account statement submitted by the petitioner was in terms of different accounting system than what the respondent adopted. The respondent therein had in its tender document not clarified the accounting system that would be adopted to assess the account statement furnished by the respective bidders. It is in this backdrop, the Hon'ble Supreme Court has held that the terms and conditions must indicate with legal certainty, norms and benchmark.
18. In the present case, it is nobody's case that any of the terms or condition in the tender was ambiguous. What is questioned by the petitioner is the deviation addressed to petitioner by respondent no.3 calling upon him to furnish documents. In our considered view, such a letter could only be termed deviation in the form of relaxation given 16 WP.8405-2018.P.odt to the petitioner thereby granting an opportunity to submit requisite documents in support of its claim which is permissible. The petitioner appears to have overlooked the observations made by Hon'ble Apex Court in paragraph 37 of the said judgment which reads thus:
"37(15). While the discretion to change the policy in exercise of the executive power, when not trammelled by any statute or rule is wide enough, what is imperative and implicit in terms of Article 14 is that a change in policy must be made fairly and should not give impression that it was so done arbitrarily or by any ulterior criteria."
19. We may lay down emphasis on the judgment in the case of Tata Cellular vs. Union of India, reported in (1994) 6 SCC 651 wherein the Hon'ble Supreme Court held that the principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness and favoritism and, therefore, there are inherent limitations in exercise of that power of judicial review. The Court further held that the Government is the guardian of the finances of the State and that Government is expected to protect the financial interest of the State and that he right to refuse the lowest or any other tender is always available to the Government. The Court then held that there can be no question of infringement of Article 14 of the 17 WP.8405-2018.P.odt Constitution if the Government tries to get the best person or the best quotation. The right to choose cannot be considered to be an arbitrary power unless it is shown that said power is exercised for collateral purpose.
20. The petitioner appears to have pleaded arbitrariness and favoritism just to wriggle out of the well-settled principles of law as enumerated in the aforesaid judgment. It is so because apart from the words, there is absolutely nothing on record to show that respondent no.3 has acted arbitrarily or unfairly or irrationally to favour respondent no.4. Rather it appears that respondent no.3 has given a fair opportunity to petitioner to submit requisite documents and complete the QR of technical bid. However, petitioner failed. We, thus find no substance in the petitioner's contentions.
21. The sum and substance of the above discussion is that the petitioner and respondent no.4 had participated in both the tenders i.e. Tender Nos. 78126 and 75989. Both were found ineligible in the technical/financial bid in previous tender. Deviation was issued to both. Petitioner failed to submit requisite documents but respondent no.4 did. There being only one valid bid, tender was refloated. The petitioner 18 WP.8405-2018.P.odt did not challenge his qualification in the previous tender. The petitioner did not allege that he was disqualified by respondent nos.2 and 3 in order to favour the respondent no.4 in the previous tender. The petitioner did not challenge refloating of the tender. The petitioner participated in the subsequent tender without any protest. The eligibility criteria for both the tenders was identical. The petitioner, knowing fully well that he could not disqualify in the technical/financial bid in the previous tender, failed to submit the requisite documents in subsequent tender. He levelled allegations against the respondent no.3 for the first time when he failed to qualify in the technical/financial bid in the second round. The petitioner was given opportunity to submit the requisite documents by way of deviation in the form of relaxation in both the tenders. However, he failed to avail opportunity.
22. In the above set of facts it cannot be said that the respondent nos.2 and 3 have acted with predetermined mind to allocate tender to respondent no.4. It appears from record that the petitioner did not qualify in terms of the qualifying requirements mentioned in the tender. The respondent no.4 has submitted the requisite documents and, therefore, found to be eligible and, accordingly, the tender has been allotted to respondent no.4. In the circumstances, keeping in mind 19 WP.8405-2018.P.odt the law laid down by the Hon'ble Supreme Court in Tata Cellular vs. Union of India ( cited supra) no interference is permissible in the action taken by the respondent nos.2 and 3 in processing tender.
23. The petitioner, thus, has failed to make out any case. The petition is devoid of merit, hence dismissed. Rule discharged.
JUDGE JUDGE sahare