Madhya Pradesh High Court
M/S Shree Enterprises Thru.Sanjay Jain vs National Fertilizers Limited on 22 February, 2018
Author: P.K. Jaiswal
Bench: Virender Singh, P.K. Jaiswal
1
W. P. No.2230 of 2017
THE HIGH COURT OF MADHYA PRADESH, BENCH AT INDORE
Division Bench: Hon'ble Shri P.K. Jaiswal &
Hon'ble Shri Virender Singh, JJ.
W. P. No.2230 of 2017
(M/s Shree Enterprises vs. National Fertilizers Ltd. & others)
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Shri Amit S. Agrawal, learned Senior Counsel with Shri Aniket
A. Naik, learned counsel for the petitioner.
Shri V. K. Jain, learned Senior Counsel with Shri Vaibhav Jain,
learned counsel for the respondent Nos.1 and 2.
None for the respondent No.3, though served.
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ORDER
(Indore, Dated : 22.02.2018) Per P.K. Jaiswal, J.
Heard.
By this writ petition under Article 226 of the Constitution of India, the petitioner is claiming for the following reliefs :-
1. Quashing the NIT No.NFL/ZOBPL/LOG/22/Ratlam/2016 dated 20.07.2016 (Annexure-P/3) and entire tender process initiated in pursuance to Annexure-P/3.
2. Directing the respondents to permit the petitioner to submit the fresh bid for NIT No.NFL/ZOBPL/LOG/22/Ratlam/2016 dated 20.07.2016 (Annexure-P/3).
3. Any other relief deemed fit and proper in the facts and circumstances of the case.
4. Costs be awarded to the petitioner.
2. Facts of the case are that the respondent Nos.1 and 2 have issued Notice Inviting Tender (NIT) for appointment of Handling & Clearing 2 W. P. No.2230 of 2017 Contractor at Ratlam Rake Point/Centre.
3. The petitioner's firm is involved into the business of handling and transportation of goods from the rake point. In order to make the fertilizers available to the farmers through the network of dealers, co- operatives, agro-industries, corporation etc. the respondent Nos.1 and 2 dispatches the fertilizers through rakes from the production units upto rake point in different States. One of the rake point in the State of Madhya Pradesh is Ratlam.
4. The petitioner was awarded contract vide order dated 26.12.2014 for handling and clearing of fertilizers at Ratlam rake point and the rates given therein.
5. After completion of the contract period, an extension has been granted for the period from 26.12.2016 to 25.03.2017 (Annexure-P/2). After completion of the aforesaid period of extension, fresh NIT was issued by the respondent Nos.1 and 2 on their web portal on 20.07.2016. The last date of submission of tender was 23.08.2016 and the opening date of tender was also 23.08.2016. The tender work involves handling and transportation of fertilizers packed in 50 kg. bags from rake point/warehouses to various destinations.
6. After issuance of fresh tender on 20.07.2016, the petitioner visited the respondent No.2 for submission of the bid along with demand draft of Rs.25,000/- towards earnest money deposit and another demand draft of Rs.250/- towards tender form charges. There is discrepancy in the rates and submitted his representation dated 01.08.2016 and, therefore, he could not submit his tender. However, the petitioner came to know that another bidder i.e., MJ Rail Road Pvt. Ltd. through Director Mr. Subhash Jain has already submitted its bid and last date for submission of tender was 23.08.2016. The petitioner had written a letter dated 24.08.2016 to the respondent Nos.1 and 2 3 W. P. No.2230 of 2017 informing that MJ Rail Road Pvt. Ltd. has submitted its bid for the subject tender whereas, on account of undertaking dated 17.06.2013 furnished by Mr. Subhash Jain in M.Cr.C. No.1821/2013, the said bidder is prohibited from competing with the petitioner.
7. According to the petitioner, there was some discrepancy in the tender conditions with regard to distances of different locations like Raoti, Mahidpur City, Khachrod, Nagda etc. from Railway Rake Point, Ratlam. Therefore, he submitted a detailed representation dated 01.08.2016 pointing out the aforesaid discrepancy and submits that during existing work of the petitioner, same discrepancy has arisen which has been finally settled down upon due inspection conducted by the respondent Nos.1 and 2 when the contract was awarded to the petitioner in 2015-16 vide inspection report dated 27.03.2015 (Annexure-P/4) and fixed the rates as per the distances and road informed therein. Clause 3 of the said inspection report dated 27.03.2015 is relevant, which reads as under :-
3- nksuks i{k bl rF; ij lger gS fd jryke ls mDr dsUnzks dh nwjh dk fooj.k iwoZ lR;kiu Ogk;k tkojk rFkk uohu nwjh yks-fu-fo- jryke ds nwjh izek.k i= dz- 622@Vh-,l-@14&15 fnukad 24-03-2015 vuqlkj fuEu gSA dzekad dsanz jryke ls nwjh Jryke ls nwjh Ogk;k Ogk;k tkojk eyoklk yks-fu-fo- ¼fdeh-½ ¼fdeh-½ iwoZ izek.k i= dz-622 fnukad lR;kfir 24-03-2015 1 [kkpjksn 46 27 2 ukxnk 62 45 3 efgniqj flVh 98 85
8. Later on, he came to know that the work has been awarded to the respondent No.3 - contractor on 16.03.2017 as there was single tender for two years, extendable for another three months or part thereof on mutual consent without deciding his representation and, therefore, he 4 W. P. No.2230 of 2017 challenged the said action on the ground that respondent Nos.1 and 2 be directed to scrutinize the feasibility of relevant tender conditions and modify the same accordingly and, thereafter, issue fresh tender for the work in question.
9. A preliminary objection has been raised by the respondent Nos.1 and 2 on the ground that petitioner has not challenged any order of grant of work order issued in favour of the respondent No.3 and appointment of handling and clearing contractor on 16.03.2017 and agreement executed with the respondent No.3 on 30.03.2017. The petitioner has no locus standi as he has not submitted his tender nor participated in the tender process and prayed for dismissal of the present writ petition.
10. It is also submitted that the petitioner was well aware of the tender process but he has not participated in the tender and, therefore he cannot challenge the contract awarded to the respondent No.3. It is also pointed out that in earlier tender, which was floated in the year 2014, the respondent No.3 along with the present petitioner had participated in the tender process. The said tender was awarded in favour of the petitioner and at that time, the petitioner did not raise any objection with regard to the participation of M/s MJ Rail Road Pvt.
Ltd. in the said tender and the reason is apparent that in the said tender, the petitioner was the successful bidder and, therefore, he cannot raise an objection regarding participation of the respondent No.3.
11. It is further submitted that when the tender of the petitioner was not accepted, he challenged the same by filing a civil suit but he failed to obtain any interim order. Earlier also, the petitioner had filed a writ petition bearing W. P. No.1715/2016 and the same was dismissed on 11.01.2017.
5 W. P. No.2230 of 201712. According to the respondent Nos.1 and 2, the basic objection and dispute of the petitioner is that the petitioner wanted to prevent respondent No.3 to participate in any tender process because of their inter-se dispute to which the respondent Nos.1 and 2 have no concern. The petitioner being fully aware of the tender notice was willing to participate in the tender process but has deliberately refrained from participation therein with ulterior motive or for the reasons the best known to the petitioner.
13. The main contention of the learned Senior Counsel for the respondent Nos.1 and 2 is that the petitioner did not submit his tender form hence, he has no locus standi to challenge the award of contract issued in favour of the respondent No.3.
14. To support the aforesaid, he has drawn our attention to the decision of the Division Bench in the case of Maxima Traders Pvt. Ltd. vs. State of MP reported in 2014 (II) MPWN 5, decision of Apex Court in the case of Michigan Rubber (India) Ltd. vs. State of Karnataka & others reported in 2012 (8) SCC 216 and submitted that in matters of formulating conditions of tenders and awarding contract, greater latitude is to be conceded to State authorities, unless action of tendering is malafide and is a misuse of statutory powers, interference by Court is not warranted. If the State or its instrumentalities act reasonably, fairly and in public interest in awarding contract, interference by Court is very restrictive since no person can claim a fundamental right to carry on business with the government. The government and their undertakings must have a free hand in setting terms of the tender and only if it is arbitrary, discriminatory, malafide or actuated by bias, the Courts would interfere. The Courts cannot interfere with the terms of the tender prescribed by the government because it feels that some other terms in 6 W. P. No.2230 of 2017 the tender would have been fair, wiser or logical.
15. Lastly, he has drawn our attention to the law laid by the Apex Court in the case of Villianur Iyarkkai Padukappu Maiyam vs. Union of India & others reported in 2009 (7) SCC 561 wherein the Apex Court has held that a person, who had neither participated in the process of selection of consultant/developer nor had expressed desire to develop the port, filing writ petition to challenge the award of contract as arbitrary on the ground that the same was contrary to earlier decision of government to get feasibility report before making up development of the port is not maintainable and prayed for dismissal of the writ petition.
16. Per contra, learned Senior Counsel for the petitioner has drawn our attention to paras-1 and 2 of the reply and submits that in the year 2014, work was awarded to the petitioner and, thereafter, extension was granted till 25.03.2017 and the joint measurement report dated 27.03.2015, which has been quoted by us in the preceding paragraphs.
17. In the present case, vide Annexure-P/3, NIT was invited on 20.07.2016. The rates prescribed therein is relevant which reads as under :-
Destination-wise /District-wise /Distance-wise tentative movement plan for Rake Point, Ratlam for two years Sr. No. Destination District Distance in Qty. (MT) KM.
1 Raoti Ratlam 29 2000 2 Khachrod Ujjain 31 1800 3 Nagda Ujjain 46 2800 4 Mahidpur Ujjain 76 700
18. He has also drawn our attention to para-9 of the decision of the Apex Court in the case of Ramana Dayaram Shetty vs. International Airport India & others reported in 1979 (3) SCC 489 7 W. P. No.2230 of 2017 and submitted that for his work, petition is maintainable. Para-9 reads as under :-
9. That takes us to the next question whether the acceptance of the tender of the 4th respondents was invalid and liable to be set aside at the instance of the appellant. It was contended on behalf GI the 1st and the 4th respondents that the appellant had no locus to maintain the writ petition since no tender was submitted by him and he was a mere stranger. The argument was that if the appellant did not enter the field of competition by submitting a tender, what did it matter to him whose tender was accepted; what grievance could he have if the tender of the 4th respondents was wrongly accepted. A person whose tender was rejected might very well complain that the tender of someone else was wrongly accepted, but it was submitted, how could a person who never tendered and who was at no time in the field, put forward such a complaint ? This argument, in our opinion, is mis-conceived and cannot be sustained for a moment. The grievance of the appellant, it may be noted, was not that his tender was rejected as a result of improper acceptance of the tender of the 4th respondents, but that he was differentially treated and denied equality of opportunity with the 4th respondents in submitting a tender.
His complaint was that if it were known that non-fulfilment of the condition of eligibility would be no bar to consideration of a tender, he also would have submitted a tender and competed for obtaining a contract. But he was precluded from submitting a tender and entering the field of consideration by reason of the condition of eligibility, while so far as the 4th respondents were concerned, their tender was entertained and accepted even though they did not satisfy the condition of eligibility and this resulted in inequality of treatment which was constitutionally impermissible. This was the grievance made by the appellant in the writ petition and there can be no doubt that if this grievance were well founded, the appellant would be entitled to maintain the writ petition. The question is whether this grievance was justified in law and the acceptance of the tender of the 4th respondents was vitiated by any legal infirmity.
19. On due consideration of Para-9 of the law laid down by the Apex 8 W. P. No.2230 of 2017 Court, in the case of Ramana Dayaram Shetty (supra), which is distinguishable on facts and the same will not be applicable in the present case of the petitioner.
20. He has further drawn our attention to the decision of the Apex Court in the case of Union of India & others vs. Hindustan Development Corporation & others reported in 1993 (3) SCC 499 and submitted that even if the petitioner had not participated in the tender, then he being the aggrieved person is entitled to invoke judicial review and prayed that the preliminary objection be overruled.
21. It is well settled that if an authority who has full discretion to grant a licence prefers an existing licence holder to a new applicant, the decision cannot be interfered with on the ground of legitimate expectation entertained by the new applicant applying the principles of natural justice. It can therefore be seen that legitimate expectation can at the most be one of the grounds which may give rise to judicial review but the granting of relief is very much limited.
22. In the present case, admittedly, petitioner never participated in the tender process. There was some discrepancy in the rates in the earlier contract and he was awarded some other rates as per the joint inspection report and, therefore, he made a representation and as the same has not been decided therefore, he could not participate in the tender process.
23. Nothing has been pointed out by the petitioner that the respondent Nos.1 and 2 acted arbitrarily in awarding the work in favour of the respondent No.3 and, therefore, we cannot accept the contentions of the learned Senior Counsel for the petitioner that the work order be quashed. A person who had neither participated in the process of selection of handling & clearing agent nor had expressed desire to carry out the work, filing writ petition to challenge the award 9 W. P. No.2230 of 2017 of contract to the respondent No.3 on the ground that the same was contrary to earlier decision of the department, has no merit.
24. In the case in hand, rates has been prescribed, which we have quoted in the proceeding paragraphs and, therefore, it cannot be said that there is any arbitrariness in awarding the work to the respondent No.3.
25. In the earlier round of litigation, question regarding eligibility of the petitioner for participation in tender was considered by us and we dismissed the writ petition of the petitioner on 11.01.2017 in W. P. No.1715/2016 (M/s Sri Enterprises vs. M. P State Civil Supplies Corporation Ltd. & others). The order dated 11.01.2017 reads as under :-
Heard on the preliminary objection about maintainability of the writ petition raised by the counsel for respondent Nos.3 and 4.
In brief, the petitioner has approached this Court by way of the present petition raising the grievance that respondent Nos.3 and 4 had given the undertaking in M.Cr.C.No.1821/2013 that they will not compete directly or indirectly with the business of the petitioners but violating the said undertaking, the respondent Nos.3 and 4 had participated in the tender issued by respondent Nos.1 and 2, therefore respondent Nos.1 and 2 should disqualify the respondent Nos.3 and 4.
Learned counsel for respondent Nos.3 and 4 has raised a preliminary objection that giving of undertaking is private dispute between the petitioner and respondent No.4 and for such a private dispute, writ petition is not maintainable. He has further submitted that petitioner has filed civil for the same issue and M.Cr.C. in which the undertaking was given, is also pending and since the conditions of the order in M.Cr.C. have not been complied with, therefore he has already applied for withdrawal of undertaking and that, the petitioner has remedy to make a complaint about breach of undertaking in the M.Cr.C. and that the tender has already been awarded to respondent Nos.3 and 4 and they have started the work.10 W. P. No.2230 of 2017
Learned counsel for respondent Nos.1 and 2 has also supported the preliminary objection.
Learned counsel for petitioners has responded to the above preliminary objection and has submitted that in view of clause 41.4 of the tender document since the incorrect information was submitted, therefore the tender is required to be rejected and that in the writ petition, the petitioner has prayed for a direction to respondent Nos.1 and 2 to decide the complaint, therefore writ petition is maintainable and that there was interim order passed by this court, therefore work could not be allotted to respondent Nos.3 and 4.
Having heard learned counsel for the parties and on perusal of the record, it is noticed that the petitioners have already filed the civil suit at Ratlam raising the same grievance. Having filed the civil suit, it was not open to the petitioners to invoke the parallel proceedings by filing the writ petition. So far as one of the prayer in the writ petition for issuing a direction to respondent Nos.1 and 2 to pass fresh order after considering the complaint of the petitioners, such a direction is not warranted at this stage because the lis in this regard is already pending in the civil suit and the parties would be bound by the outcome of the suit. That apart, no legal enforceable right of issuing such a Mandamus has been pointed out by the counsel for the petitioners.
Record also reflects that meanwhile the bid of respondent Nos.3 and 4 has been finalised and the work order dated 17.6.2016 has been issued in favour of respondent Nos.3 and 4. This fact has been disclosed by the petitioners themselves in I.A.No. 3621/2016. Though this court on 8.3.2016 has passed the interim order in the matter but the said interim order was not continued on 22.3.2016. This Court is not expressing any opinion in respect of the scope of clause 41.4 of the tender document because the issues are subject matter of consideration in the civil suit. At this stage, suffice it to say that on the basis of said clause, writ cannot be entertained and no direction can be issued.
In view of aforesaid analysis, I am of the opinion that writ petition filed by the petitioners is not maintainable, which is accordingly dismissed.
11 W. P. No.2230 of 201726. On due consideration of the aforesaid so also the decisions cited by the learned Senior Counsel for the petitioner, we are of the view that the petitioner did not submit his tender form hence, he has no locus standi to challenge the award of contract issued in favour of the respondent No.3. The writ petition filed by the petitioner has no merit and is accordingly, dismissed with cost of Rs.10,000/-.
(P. K. Jaiswal) (Virender Singh)
Judge Judge
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Digitally signed by Geeta Pramod
Date: 2018.02.26 16:58:16 +05'30'