Karnataka High Court
Sis Limited vs Bangalore Metro Rail Corporation ... on 22 November, 2024
Author: Hemant Chandangoudar
Bench: Hemant Chandangoudar
-1-
NC: 2024:KHC:47777
WP No. 19441 of 2023
C/W WP No. 19442 of 2023
WP No. 22921 of 2023
AND 1 OTHER
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 22ND DAY OF NOVEMBER, 2024
BEFORE
THE HON'BLE MR JUSTICE HEMANT CHANDANGOUDAR
WRIT PETITION NO. 19441 OF 2023 (GM-TEN)
C/W
WRIT PETITION NO. 19442 OF 2023 (GM-TEN)
WRIT PETITION NO. 22921 OF 2023 (GM-TEN)
WRIT PETITION NO. 22938 OF 2023 (GM-TEN)
IN WP No. 19441/2023
BETWEEN:
SIS LIMITED,
A PUBLIC LIMITED COMPANY
INCORPORATED UNDER THE
COMPANIES ACT, 1956
AND HAVING ITS REGISTERED
OFFICE AT ANNAPOORNA BHAWAN,
PATLIPUTRA TELEPHONE
EXCHANGE ROAD, KURJI, PATNA,
REPRESENTED BY ITS MANAGER
MR.GOWTHAM B.N.
Digitally signed by B
K ALSO AT NO.106, 1ST FLOOR,
MAHENDRAKUMAR
Location: HIGH RAMANASHREE ARCADE,
COURT OF
KARNATAKA 18, MG ROAD,
BENGALURU - 560 001.
...PETITIONER
(BY SRI. I.S.DEVAIAH, ADVOCATE FOR
SRI.DEVARAJ K. S., ADVOCATE)
AND:
1. BANGALORE METRO RAIL
CORPORATION LIMITED,
3RD FLOOR, BMTC COMPLEX,
KH ROAD, SHANTHINGAR,
-2-
NC: 2024:KHC:47777
WP No. 19441 of 2023
C/W WP No. 19442 of 2023
WP No. 22921 of 2023
AND 1 OTHER
BENGALURU - 560 027.
A JOINT VENTURE OF
GOVERNMENT OF KARNATAKA AND
GOVERNMENT OF INDIA.
REPRESENTED BY ITS MANAGING DIRECTOR.
2. WISDOM SECURITY SERVICES,
HAVING ITS OFFICE AT
NO.106, 40 FEET ROAD, 1ST FLOOR,
WEST OF CHORD ROAD,
MANJUNATHNAGAR,
BENGALURU - 560 010.
A PROPRIETORSHIP CONCERN,
REPRESENTED BY ITS PROPRIETOR
MR.PRAKASH N.C.
3. GOVERNMENT OF KARNATAKA,
THROUGH THE CENTRE FOR E-GOVERNANCE,
HAVING ITS OFFICE AT 4TH FLOOR,
SRI.ARAVIND BHAVAN,
MYTHIC SOCIETY COMPOUND,
NRUPATHUNGA ROAD,
BANGALORE - 560 001.
REPRESENTED BY PROJECT-DIRECTOR,
E-PROCUREMENT CELL.
...RESPONDENTS
(BY SRI. VIKRAM A HUILGOL, SENIOR COUNSEL FOR
SRI. K. KRISHNA., ADVOCATE FOR R1;
SRI.JAYAKUMAR S PATIL, SENIOR COUNSEL FOR
SRI.DUSHYANTH ARADHYA H.C., ADVOCATE FOR R2;
SRI.ARUNA G.S., HCGP FOR R3)
THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE
CONSTITUTION OF INDIA PRAYING TO DIRECT THE R1 TO PLACE
BEFORE THIS HONBLE COURT THE ENTIRE FILE RELATING TO
THE TENDER FOR PROVIDING SECURITY AND ALLIED SERVICES
FOR DEPOT, STATIONS, VIADUCT, TRACK AND TRAINS OF
REACH-4 AND 4A SECTIONS OF THE R1, INCLUDING BUT NOT
LIMITED TO, ALL OF THE TENDER-RELATED DOCUMENTATION,
THE BID DOCUMENTS, FILED NOTINGS, CORRESPONDENCES,
AWARD DOCUMENTS, LETTER/S OF ACCEPTANCE, CONTRACT/S
ETC.,
-3-
NC: 2024:KHC:47777
WP No. 19441 of 2023
C/W WP No. 19442 of 2023
WP No. 22921 of 2023
AND 1 OTHER
IN WP NO. 19442/2023
BETWEEN:
SIS LIMITED,
A PUBLIC LIMITED COMPANY
INCORPORATED UNDER THE
COMPANIES ACT, 1956
AND HAVING ITS REGISTERED
OFFICE AT ANNAPOORNA BHAWAN,
PATLIPUTRA TELEPHONE EXCHANGE ROAD,
KURJI, PATNA,
REPRESENTED BY MANAGER,
MR.GOWTHAM B.N.
ALSO AT NO.106, 1ST FLOOR,
RAMANASHREE ARCADE, 18
MG ROAD, BENGALURU - 560 001.
...PETITIONER
(BY SRI. I.S.DEVAIAH, ADVOCATE FOR
SRI.DEVARAJ K. S., ADVOCATE)
AND:
1. BANGALORE METRO RAIL
CORPORATION LIMITED,
3RD FLOOR, BMTC COMPLEX,
KH ROAD, SHANTHINGAR,
BENGALURU - 560 027.
A JOINT VENTURE OF
GOVERNMENT OF KARNATAKA AND
GOVERNMENT OF INDIA.
REPRESENTED BY ITS
MANAGING DIRECTOR.
2. WISDOM SECURITY SERVICES,
HAVING ITS OFFICE AT
NO.106, 40 FEET ROAD, 1ST FLOOR,
WEST OF CHORD ROAD, MANJUNATHNAGAR,
BENGALURU - 560 010.
A PROPRIETORY CONCERN,
-4-
NC: 2024:KHC:47777
WP No. 19441 of 2023
C/W WP No. 19442 of 2023
WP No. 22921 of 2023
AND 1 OTHER
REPRESENTED BY ITS PROPRIETOR
MR.PRAKASH N.C.
3. GOVERNMENT OF KARNATAKA,
THROUGH THE CENTRE FOR E-GOVERNANCE,
HAVING ITS OFFICE AT 4TH FLOOR,
SRI.ARAVIND BHAVAN,
MYTHIC SOCIETY COMPOUND,
NRUPATHUNGA ROAD,
BANGALORE - 560 001.
REPRESENTED BY PROJECT-DIRECTOR,
E-PROCUREMENT CELL.
...RESPONDENTS
(BY SRI. VIKRAM A HUILGOL, SENIOR COUNSEL FOR
SRI. K. KRISHNA., ADVOCATE FOR R1;
SRI.JAYAKUMAR S PATIL, SENIOR COUNSEL FOR
SRI.DUSHYANTH ARADHYA H.C., ADVOCATE FOR R2;
SRI.ARUNA G.S., HCGP FOR R3)
THIS WP IS FILED UNDER ARTICLE 226 OF THE
CONSTITUTION OF INDIA PRAYING TO DIRECTION IN THE NATURE
OF A WRIT OF MANDAMUS OR SUCH OTHER APPROPRIATE WRIT,
ORDER OR DIRECTION, DIRECTING THE R1 TO PLACE BEFORE
THIS HONBLE COURT THE ENTIRE FILE RELATING TO THE
TENDER FOR PROVIDING SECURITY AND ALLIED SERVICES FOR
DEPOT, STATION, VAIDUCT, TRACK AND TRAINS OF REACH-1
SECTION OF THE R1, INCLUDING BUT NOT LIMITED TO, ALL OF
THE TENDER-RELATED DOCUMENTATION, THE BID DOCUMENTS,
FILE NOTINGS, CORRESPONDENCES, AWARD DOCUMENTS,
LETTERS OF ACCEPTANCE, CONTRACTS ETC.,
IN WP NO. 22921/2023
BETWEEN:
SIS LIMITED,
A PUBLIC LIMITED COMPANY
INCORPORATED UNDER THE
COMPANIES ACT, 1956
AND HAVING ITS REGISTERED
OFFICE AT ANNAPOORNA BHAWAN,
PATLIPUTRA TELEPHONE EXCHANGE ROAD,
-5-
NC: 2024:KHC:47777
WP No. 19441 of 2023
C/W WP No. 19442 of 2023
WP No. 22921 of 2023
AND 1 OTHER
KURJI, PATNA,
REPRESENTED BY MANAGER,
MR.GOWTHAM B.N.
ALSO AT NO.106, 1ST FLOOR,
RAMANASHREE ARCADE, 18
MG ROAD, BENGALURU - 560 001.
...PETITIONER
(BY SRI. I.S.DEVAIAH, ADVOCATE FOR
SRI.DEVARAJ K. S., ADVOCATE)
AND:
1. BANGALORE METRO RAIL
CORPORATION LIMITED,
3RD FLOOR, BMTC COMPLEX,
KH ROAD, SHANTHINGAR,
BENGALURU - 560 027.
A JOINT VENTURE OF
GOVERNMENT OF KARNATAKA AND
GOVERNMENT OF INDIA.
REPRESENTED BY ITS
MANAGING DIRECTOR.
2. WISDOM SECURITY SERVICES,
HAVING ITS OFFICE AT
NO.106, 40 FEET ROAD, 1ST FLOOR,
WEST OF CHORD ROAD, MANJUNATHNAGAR,
BENGALURU - 560 010.
A PROPRIETORSHIP CONCERN,
REPRESENTED BY ITS PROPRIETOR
MR.PRAKASH.
3. GOVERNMENT OF KARNATAKA,
THROUGH THE CENTRE FOR E-GOVERNANCE,
HAVING ITS OFFICE AT 4TH FLOOR,
SRI.ARAVIND BHAVAN,
MYTHIC SOCIETY COMPOUND,
NRUPATHUNGA ROAD,
BANGALORE - 560 001.
REPRESENTED BY PROJECT-DIRECTOR,
E-PROCUREMENT CELL.
...RESPONDENTS
-6-
NC: 2024:KHC:47777
WP No. 19441 of 2023
C/W WP No. 19442 of 2023
WP No. 22921 of 2023
AND 1 OTHER
(BY SRI. DHANANJAYA JOSHI, SENIOR COUNSEL FOR
SRI.VACHAN H.U., ADVOCATE FOR R1;
SRI.JAYAKUMAR S PATIL, SENIOR COUNSEL FOR
SRI.DUSHYANTH ARADHYA H.C., ADVOCATE FOR R2;
SRI.ARUNA G.S., HCGP FOR R3)
THIS WP IS FILED UNDER ARTICLE 226 OF THE
CONSTITUTION OF INDIA PRAYING TO DIRECTING THE R1 TO
PLACE BEFORE THIS HONBLE COURT THE ENTIRE FILE RELATING
TO THE TENDER VIDE TENDER NOTIFICATION NO. BMRCL/O AND
M/HR/SECURITY/R3 AND 3A/2023/2 DATED 20/03/2023 FOR
PROVIDING SECURITY AND ALLIED SERVICES FOR DEPOT,
STATIONS, VIADUCT, TRACK AND TRAINS OF REACH-3 AND 3A
SECTION OF THE R1, INCLUDING BUT NOT LIMITED TO, ALL OF
THE TENDER-RELATED DOCUMENTS, THE BID DOCUMENTS, FILE
NOTINGS, CORRESPONDENCES, AWARD DOCUMENTS, LETTER/S
OF ACCEPTANCE, CONTRACT/S, ETC.,
IN WP NO. 22938/2023
BETWEEN:
SIS LIMITED,
A PUBLIC LIMITED COMPANY,
INCORPORATED UNDER THE
COMPANIES ACT 1956,
AND HAVING ITS REGISTERED OFFICE
AT ANNAPOORNA BHAWAN,
PATLIPUTRA TELEPHONE EXCHANGE ROAD,
KURJI, PATNA,
REPRESENTED BY ITS MANAGER
MR. GOWTHAM B N,
ALSO AT NO.106, 1ST FLOOR,
RAMANASHREE ARCADE, 18,
MG ROAD,
BENGALURU - 560 001.
...PETITIONER
(BY SRI. I.S.DEVAIAH, ADVOCATE FOR
SRI.DEVARAJ K. S., ADVOCATE)
-7-
NC: 2024:KHC:47777
WP No. 19441 of 2023
C/W WP No. 19442 of 2023
WP No. 22921 of 2023
AND 1 OTHER
AND:
1. BANGALORE METRO RAIL
CORPORATION LIMITED,
3RD FLOOR, BMTC COMPLEX,
KH ROAD, SHANTHINAGAR,
BENGALURU - 560 027.
A JOINT VENTURE OF KARNATAKA
AND GOVERNMENT OF INDIA,
REPRESENTED BY ITS
MANAGING DIRECTOR.
2. WISDOM SECURITY SERVICES,
HAVING ITS OFFICE AT
NO.106, 40 FEET ROAD, 1ST FLOOR,
WEST OF CHORD ROAD,
MANJUNATHNAGAR,
BENGALURU - 560 010.
A PROPRIETORSHIP CONCERN,
REPRESENTED BY ITS
PROPRIETOR PRAKASH.
3. GOVERNMENT OF KARNATAKA,
THROUGH THE CENTRE FOR E-GOVERNANCE,
HAVING ITS OFFICE AT 4TH FLOOR,
SRI.ARAVIND BHAVAN,
MYTHIC SOCIETY COMPOUND,
NRUPATHUNGA ROAD,
BANGALORE - 560 001.
REPRESENTED BY PROJECT-DIRECTOR,
E-PROCUREMENT CELL.
...RESPONDENTS
(BY SRI. DHANANJAYA JOSHI, SENIOR COUNSEL FOR
SRI.VACHAN H.U., ADVOCATE FOR R1;
SRI.JAYAKUMAR S PATIL, SENIOR COUNSEL FOR
SRI.DUSHYANTH ARADHYA H.C., ADVOCATE FOR R2;
SRI.ARUNA G.S., HCGP FOR R3)
THIS WP IS FILED UNDER ARTICLE 226 OF THE
CONSTITUTION OF INDIA PRAYING TO i) DIRECTING THE R1 TO
PLACE BEFORE THIS HONBLE COURT THE ENTIRE FILE RELATING
TO THE TENDER VIDE TENDER NOTIFICATION NO.BMRCL/O AND
-8-
NC: 2024:KHC:47777
WP No. 19441 of 2023
C/W WP No. 19442 of 2023
WP No. 22921 of 2023
AND 1 OTHER
M/HR/SECURITY/UG-1 AND UG-2/2023/2 DATED 18/03/2023
ANNEXURE-C FOR PROVIDING SECURITY AND ALLIED SERVICES
FOR DEPOT, STATIONS, VIADUCT, TRACK AND TRAINS OF REACH
UG-1 AND UG-2 SECTION OF THE R1, INCLUDING BUT NOT
LIMITED TO, ALL OF THE TENDER-RELATED DOCUMENTATION,
THE BID DOCUMENTS, FILE NOTINGS, CORRESPONDENCES,
AWARD DOCUMENTS, LETTER/S OF ACCEPTANCE, CONTRACT/S,
ETC
THESE PETITIONS, COMING ON FOR ORDERS, THIS DAY,
ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE HEMANT CHANDANGOUDAR
ORAL ORDER
The petitioner is common to all these petitions and is challenging the rejection of their bid on the grounds that the price quoted for the supply of devices was deemed unrealistic.
2. Respondent No. 1 issued a tender document for providing security and allied services for Reach-4. In response to the tender, the petitioner submitted bids for all sections of Reach-4. The technical bid submitted by the petitioner was accepted; however, upon the opening of the financial bid, Respondent No. 1 rejected the petitioner's bid.
3. The tender document stipulated the criteria for qualifying both the technical and financial bids. One of the conditions, as specified in Clause 6.3(4), Sub-section 3, stated that bidders shall not quote unrealistic prices for the supply of devices. Additionally, the qualification criteria outlined in Sl. No. 7 of the instructions appended to the tender document required that the price quoted for the devices should align with the prices in recent contracts. To demonstrate this alignment, bidders were required to -9- NC: 2024:KHC:47777 WP No. 19441 of 2023 C/W WP No. 19442 of 2023 WP No. 22921 of 2023 AND 1 OTHER provide at least three invoices reflecting the latest purchase orders. Moreover, bidders were expected to produce purchase orders or invoices showing that they had previously supplied devices at the quoted rates for BMRCL.
4. The technical bids of the petitioner and two other bidders were accepted. However, upon opening the financial bids of these three bidders, the Tender Evaluation Committee recorded the following:
"As per submittals, the quoted rates towards HHMDs by the Three (03) Tenderers are as follows:
Required Bid Unit Rate Total Cost Tenderer Quantity No. (In Rs) (In Rs) (Nos.) 1 M/s CISB 2,000.00 1,28,000.00 64 2 M/s Wisdom 1,865.00 1,19,360.00 3 M/s SIS Limited 49.00 3,136.00 The above quotes, have been evaluated based on the conditions specified in the Table-2 of Form-9B and brought out the position the above three Tenderers with regard to supply of HHMDs as detailed below:
a. M/s CISB (1/3) has quoted Rs.2,000/- per HHMD as per quotation and also submitted four invoices showing HHMD unit rate @ Rs.3,250/-, Rs.3,000/-, Rs.2,200/- & Rs.2,119/- (Without GST) issued by HHMD manufacturer M/s Master Kings Corps, to establish that the price quoted by him is in line with the latest POs. The Tenderer has complied the conditions indicated in Table-2 of Form-9B. Hence, the
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NC: 2024:KHC:47777 WP No. 19441 of 2023 C/W WP No. 19442 of 2023 WP No. 22921 of 2023 AND 1 OTHER Tenderer's quote is considered to be in order and acceptable.
b. M/s Wisdom Security Services (2/3) has quoted Rs.1,865/-
per HHMD and also submitted Three (03) invoices showing HHMD unit rate @ Rs.1,017/-, Rs.1,017/- & Rs.1,865/- (Without GST) issued by HHMD manufacturer M/s Magtech Security Systems Pvt Ltd., to establish that the price quoted by him is in line with the latest POs. The Tenderer has complied the conditions indicated in Table-2 of Form-9B. Hence, the Tenderer's quote is considered to be in order and acceptable.
c. M/s SIS LIMITED (3/3) has quoted Rs.49/- per HHMD and also submitted Five (05) PO/GEM contract/CR&AC report showing HHMD unit rate @ Rs.2,400/-, Rs.2,369/-, Rs.2,965/-, Rs.3,614/- & Rs.2,685/- (Without GST) issued by HHMD manufacturer M/s Hope Security Equipment's Pvt Ltd. The quoted price of Rs.49/- per HHMD evidently confirms that the price is 'Unrealistic' & 'NOT' in line with the price of latest contracts/Invoices submitted by the Tenderer. The Tenderer has NOT complied with the Tender conditions specified in Table-2 of Form-9B. Hence, the financial package is NOT considered for evaluation."
5. Learned counsel for the petitioner contended that the price quoted by Respondent No. 2 for the devices to be supplied is equally unrealistic. He further argued that the price quoted by the petitioner and Respondent No. 2 for the provision of manpower and
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NC: 2024:KHC:47777 WP No. 19441 of 2023 C/W WP No. 19442 of 2023 WP No. 22921 of 2023 AND 1 OTHER devices is more or less the same. Therefore, the rejection of the petitioner's bid on the ground of quoting an unrealistic price is arbitrary and discriminatory. The counsel also emphasized that the petitioner was not afforded an opportunity to be heard before the rejection of the bid, thereby violating the principles of natural justice and Article 14 of the Constitution of India. Additionally, the learned counsel asserted that Respondent No. 1 did not float the tender under the provisions of the Karnataka Transparency in Public Procurement Act, 1999 (hereinafter referred to as the 'KTPP Act'), and as such, the issuance of the tender document and the subsequent award of the contract to Respondent No. 2 lack legal authority.
6. In support of his contentions, the learned counsel for the petitioner relied upon the following judgments:
i. Sical Logistics Ltd. v. KPCL, reported in ILR 2006 KAR 4216.
ii. B.K. Bhaskar and Others v. Commissioner, BDA, reported in ILR 2009 KAR 1483.
iii. State of West Bengal v. Gitashree Dutta, reported in 2022 SCC Online SC 691.
iv. Logwell Forge Ltd. and Others v. BMRCL, reported in 2017 (2) KAR LJ 358.
7. In response, the learned counsel for the respondents argued that Clause 6.3(4)(iii) of the tender document clearly stipulates that bids quoting unrealistic prices for the supply of
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NC: 2024:KHC:47777 WP No. 19441 of 2023 C/W WP No. 19442 of 2023 WP No. 22921 of 2023 AND 1 OTHER Hand-Held Metal Detectors (HHMDs) shall be rejected. Despite being aware of this clause, the petitioner quoted an unrealistic price for the devices. Therefore, Respondent No. 1 was justified in rejecting the petitioner's bid. The respondents further contended that the petitioner, having participated in the tender process and accepted its terms and conditions without protest, is now estopped from challenging the legality of the process on the ground that it was not conducted under the KTPP Act. They also argued that the provisions of the KTPP Act were duly complied with, and the petitioner has failed to demonstrate any procedural irregularity.
8. The arguments advanced by the learned counsel for both parties have been duly considered.
9. Clause 6.3(4)(iii) of the tender document stipulates that bids quoting below minimum wages, nil service charges, or unrealistic prices for devices shall be rejected. It further specifies that incomplete bids shall also be disqualified. This clause forms a fundamental part of the evaluation criteria and was binding on all bidders, including the petitioner.
10. In the present case, the petitioner quoted a price of Rs.49/- per device and submitted five purchase orders purporting to show device rates of Rs.2,400/-, Rs.2,369/-, Rs.2,965/-, Rs.3,614/-, and Rs.2,685/-. In contrast, Respondent No. 2 quoted a price of Rs.1,865/- per device and provided three invoices reflecting rates of Rs.1,017/-, Rs.1,017/-, and Rs.1,865/-. The Tender Evaluation Committee, after a thorough assessment of the
- 13 -
NC: 2024:KHC:47777 WP No. 19441 of 2023 C/W WP No. 19442 of 2023 WP No. 22921 of 2023 AND 1 OTHER bids and supporting documents, concluded that the price quoted by the petitioner was unrealistic. Alternatively, the price quoted by Respondent No. 2 was found to be reasonable and the lowest among the bids. Consequently, the contract was awarded to Respondent No. 2.
11. Given these facts, Respondent No. 1 acted within its rights and in accordance with Clause 6.3(4)(iii) of the tender document when it rejected the petitioner's bid. The petitioner's participation in the tender process without any objections and subsequent challenge only after rejection of the bid indicates an acceptance of the process and terms. The petitioner has not provided sufficient evidence to substantiate claims of arbitrariness or discrimination. Furthermore, the petitioner has failed to demonstrate any prejudice caused by the lack of a personal hearing prior to the rejection of the bid.
12. The respondents' contend that the tender was not conducted through the e-portal due to technical reasons, and that the petitioner cannot challenge the tender process on this ground after having accepted and participated. The arguments revolve around the doctrines of waiver, acquiescence, and estoppel, which are fundamental in matters involving awarding of contracts. The petitioner voluntarily participated in the tender process, fully aware of its terms and conditions. By submitting a bid, the petitioner accepted the rules and procedures governing the tender, including the mode of publication and submission. Once the petitioner participated without objection, it effectively acknowledged the
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NC: 2024:KHC:47777 WP No. 19441 of 2023 C/W WP No. 19442 of 2023 WP No. 22921 of 2023 AND 1 OTHER validity of the process. Raising objections regarding non- compliance with the KTPP Act only after the rejection of the bid constitutes a belated challenge and indicates an attempt to circumvent an unfavorable outcome.
13. The judgments cited by the petitioner are distinguishable from the present case. In those decisions, there was no specific clause stipulating the rejection of bids on the grounds of unrealistic pricing. Therefore, the principles laid down in those cases are not applicable to the facts at hand.
14. In light of the foregoing, it is concluded that the rejection of the petitioner's bid is neither arbitrary nor discriminatory. The decision of Respondent No. 1 is in accordance with the tender terms and conditions, and no procedural irregularity or violation of legal provisions has been established.
15. Accordingly, petitions are dismissed.
Sd/-
(HEMANT CHANDANGOUDAR) JUDGE RKA List No.: 1 Sl No.: 69