Orissa High Court
M/S.H.M.Construction vs State Of Orissa & Others ......... ... on 3 September, 2012
Author: V.Gopala Gowda
Bench: V.Gopala Gowda
ORISSA HIGH COURT: CUTTACK
WRIT PETITION (CIVIL) No.14208 of 2012
In the matter of an application under Article 226 and 227 of the
Constitution of India.
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M/s.H.M.Construction ......... Petitioner
-versus-
State of Orissa & others ......... Opp.Parties
_______________
For petitioner : M/s.J.Das, Sr. Advocate along with
Mr.A.Routray, U.R.Bastia, M.Routray,
B.N.Swarnakar
For opp.parties : Mr.B.K.Nayak
Addl.Govt. Advocate
PRESENT:
THE HONOURABLE THE CHIEF JUSTICE SHRI V.GOPALA GOWDA
AND
THE HONOURABLE SHRI JUSTICE S.K.MSIHRA
Date of hearing & judgment : 03.09.2012
V.Gopala Godwa, C.J. The petitioner, who is a Super Class Contractor, has
filed this writ petition questioning the decision of the State Government
rejecting the technical bid as well as the tender call notice bid
identification No.CCE-UKP-03(3)/2011-12 and alleging that the said
decision is improper, oblique and with an alien purpose to prevent it
from effectively participating in the tender process urging various facts
and legal contentions.
2
2. Opposite party no.2 invited bids for four items of works in
bid identification No. CCE-UKP-03(3)/2011-12 pursuant to letter no.
1435 dated 26.3.2010 (Annexure-1). Out of the said four works, item
no.1 relates to excavation work including construction of a road work,
item no.2 is for construction of a road work and item nos.3 and 4 are
excavation work including construction of structures. Since the nature
of works are different from each other and separate invitation for each
item has been made, the petitioner and one M/s.Ratna Infrastructure
Project Pvt. Ltd. submitted their bids, both technical and financial along
with all the documents within the time stipulated in the tender notice
submitted its tender in respect of item no.3, i.e., Excavation of
Telengeri Main Canal from R.D. 6480m to 7650m, including
construction of four nos. of structures of EMIP, whose approximate
estimate value was Rs.792.50 lakhs. The bids were opened on
5.5.2012and the same were placed before the Project Level Technical Committee. On scrutiny by the Project Level Technical Committee, it was found that the petitioner satisfied all the conditions of the bid identification notification and, as such, the Technical Committee accepted the technical bid of the petitioner and decided to obtain approval from the Government. But so far as the technical bid of M/s.Ratna Infrastructure Project Pvt. Ltd. is concerned, the Technical Committee found that the original EMD and Demand Draft towards the tender paper cost produced by the said firm did not match with the 3 EMD and paper cost off loaded by him in web-site. Therefore, the bid of M/s.Ratna Infrastructure Project Pvt. Ltd. was considered as non- responsive. However, the opposite party no.2 in his letter no. 2341 dated 26.5.2012 (Annexure-5) submitted the bid document of e- procurement of the work in item no.3 to the State Government for its decision. In the said letter it was specifically suggested to the State Government to approve the technical bid of the petitioner.
4. The proposal sent by opposite party no.2 was discussed in the Tender Committee held on 25.6.2012 and the said Committee unanimously decided to cancel all the four nos. of tenders invited in a common tender call notice including the work in respect of which the petitioner had submitted its bid. The said Tender Committee also instructed the opposite party no.2 to issue show cause notice to M/s.Ratna Infrastructure Project Pvt. Ltd. as to why it had submitted two nos. of EMD and cost of tender paper for the same work and directed the opposite party no.2 to club up all the four works into a single package, if feasible, and invite fresh tender at the earliest. The said letter of cancellation of the earlier tender was communicated by the F.A.-cum-Addl. Secretary to the Government in the Department of Water Resources, Government of Odisha by letter dated 9.7.2012 (Annexure-6). Accordingly, the opposite party no.2 by letter no. 3437 dated 1.8.2012 (Annexure-11) cancelled the bid identification no. CCE- UKP-03(3)/2011-12 and again invited online item rate basis bid in 4 double cover system through e-procurement by clubbing up of all the four works together in daily news paper "The Samaja" on 9th August, 2012 (Annexure-12). The said decision of cancellation of the bid of the petitioner (Annexure-6) and clubbing up of all the four works together vide notification in Annexure-12 is challenged by the petitioner in the present writ petition urging the following grounds:
(i) Even though the petitioner's technical bid was found satisfactory, the action of the Government in cancelling the tender call notice pursuant to the decision of the Tender Committee dated 25.6.2012 in Annexure-11, is illegal and arbitrary.
(ii) The publication of e-procurement notice vide Annexure-12 calling for bids in double cover system through e-
procurement by clubbing up all the four works into a single package is arbitrary, unreasonable and violative of Article 14 of the Constitution of India.
5. Mr.Nayak, learned Additional Government Advocate seeks to justify the action of the State Government in cancelling the tender notice and the impugned notification published in 'The Samaja' dated 9th August, 2012 in Annexure-12 inviting e-procurement notice calling for bids in double cover system through e-procurement by clubbing up all the four works into a single package contending that the same is a 5 policy decision of the State Government and this Court should not interfere with such policy decision of the State Government by exercising judicial review power. In support of such submission, he has placed reliance on the decision of the Supreme Court in the case of Shimnit Utsch India Pvt. Ltd. and another v. West Bengal Transport Infrastructure Development Corporation and others, (2010) 6 SCC
303.
6. Learned Addl. Government has also produced the concerned Government file in support of his submission and invited our attention to the note-sheet page no.3 of Govt. File No.IIT-UKP-7/2012, wherein, the decision of the Tender Committee for cancelling the earlier tender and to invite fresh tender by clubbing up of all the works into a single package has been communicated to the opposite party no.2 for finalizing the pre-qualification bid as per office order no.8522 dated 22.3.2010 (at flag 'A' of the Govt. file), which was issued by the Commissioner-cum-Secretary to Government. Therefore, he submits that this is not a fit case to interfere with the impugned notice and the order of the State Government and prays for dismissal of the writ petition.
7. With reference to the aforesaid rival contentions, we have very carefully gone through the Government file, more particularly, order No.8522 dated 22.3.2010, with a view to find out as to whether the order of cancellation and clubbing up of four works into a single 6 package is a decision of the Government and is also a policy decision but it had earlier invited the tender by segregating the four works when the financial bid of the petitioner as a single tenderer was not acceptable to the State Government, the same was sent by the opposite party no.2 to the Government for approval. The office order no. 8522 dated 22.3.2010 issued by the Commissioner-cum-Secretary to Government, on which reliance has been placed in the note-sheet of the Government file is extracted below:
" GOVERNMENT OF ORISSA DEPARTMENT OF WATER RESOURCES OFFICE ORDER II-M-6/2010 No.8522/W.R. dated 22.3.2010 As per Para 6.3.15 of OPWD Code Vol.I, the pre-qualification bids and financial bids in respect of the tender costing Rs.7.00 crores and above are being placed before the Tender Committee for suitable recommendation. After obtaining the recommendation of the Tender Committee on prequalification bids, Government orders are being obtained and communicated to the Project Authority for opening of the financial bids of the qualified bidders. Thereafter the financial bids of the above bidders are being placed before the Tender Committee and Government orders are taken on the recommendation of the Tender Committee. This is communicated to the Project Authority for award of the work. As such, Government orders are taken twice in a bid, which delays finalization of Tender within the validity period (due to processing of proposals for obtaining Government orders twice).
With a view to avoid the delay caused due to this process, Government have been pleased to authorize the Tender Committee of the Department to finalize the prequalification bids and to communicate orders to the Project Authority for opening of the financial bids of the qualified bidders.
Sd/-22.3.2010 Commissioner-cum-Secretary to Government Memo No.8523/W.R. dated 22.3.2010 Copy to Finance Department/ Law Department/ All Engineer-in- Chief, Water Resources/ All Chief Engineer and Basin Managers/ All CEs/ All CCEs of Department of Water Resources for information.
Sd/-
F.A.-cum-Addl.Secretary to Government."
8. On perusal of the office order extracted above, it reveals that the said order indicates only fixation of pre-qualification bids, but 7 does not speak about clubbing of all the four works into a single package, which, according to the learned Addl. Govt. Advocate, is a policy decision. That apart, the said office order was issued in the year 2010 and the note sheet reveals that the State Government referring to the said office order of the year 2010 issued the impugned order dated 9.7.2012 (Annexurer-6) rejecting four nos. of tenders and directing the opposite party no.2 to club up all the four works into a single tender package. The rejection of the financial bid of the petitioner on the recommendation made by the Tender Committee, which was forwarded to the State Government, because of the fact that the petitioner was a single tenderer, may be a correct decision, but clubbing up of all the four works together must be a decision to be taken by the State Government and the said decision must be approved by political executive. As can be seen from the file, there is no such signature of the political executive except the signature of F.A.-cum-Addl. Secretary, which was signed on 7.7.2012 and the same has been communicated to the opposite party no.2 on 9.7.2012 (Annexure-6). Therefore, the order cannot be termed as a decision of the Government approved by political executive as per the rules of business of the Government in exercise of power by His Excellency, the Governor under Article 166 of the Constitution of India. Therefore, clubbing up of four works together into a single package cannot be termed as a policy decision of the Government in order to exclude the judicial review 8 power of this Court and therefore, the decision referred to above by the learned Additional Government Advocate is not at all applicable to the case in hand. To the extent of clubbing up of all the four works together, we are required to interfere, for the reasons that it is not the decision of the State Government and there is absolutely no reason forthcoming either from the impugned order or from the Government file for clubbing up of the four works together when the Tender Committee had earlier invited the bids by segregating all the four works in the tender notice referred to supra. Therefore, the decision of the tender committee clubbing up of all the four works on the basis of the approval made by the F.A.-cum-Addl. Secretary to the Government, cannot be a decision of the Government and on that basis the tender committee should not have decided to club up all the four works into a single tender package. Thus, in our considered opinion, the decision of the tender committee recommending to club up all the four works into a single tender package is arbitrary and unreasonable.
9. In view of the foregoing discussions, we set aside the decision relating to clubbing up of all the four works together into a single tender package pursuant to the letter dated 9.7.2012 (Annexure-
6) and quash the e-procurement notice in Bid Identification No.CCE- UKP 02/2012-13 in Annexures-12 & 13 and direct the opposite parties to segregate the said work as was done earlier and re-issue the tender so that more than one tenderer would participate in the tender and the 9 work would be completed expeditiously if it is entrusted to more than one contractor which would be in the interest of public.
10. The writ petition is allowed in part. However, in the facts and circumstances of the case, there shall be no order as to cost.
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V.Gopala Gowda,C.,J.
S.K.Mishra,J. I agree.
............................................. S.K.Mishra,J.
Orissa High Court, Cuttack September 3, 2012/ PKSahoo