Jharkhand High Court
Amr Dev Prabha Through Its Power Of ... vs The Union Of India Through The Secretary ... on 16 August, 2017
Equivalent citations: 2018 (1) AJR 424, (2017) 4 JCR 674 (JHA)
Author: Rongon Mukhopadhyay
Bench: Rongon Mukhopadhyay
W. P. (C) No. 3685 of 2015 In the matter of an application under Article 226 of the Constitution of India --- AMR - DEV PRABHA, a Consortium of M/s. AMR India Ltd. and M/s Dev Prabha Construction Pvt. Ltd. having its head office at "Sai Krupa", D. No. 8-3-833, Phase-I, Kamalapauri Colony, Hyderabad-500073 through its power of attorney holder Mithilesh Kumar Singh S/o Shyam Bahadur Singh R/o Simlabahal Colliery, PO & PS-Jharia, Dist. Dhanbad ... ... Petitioner Versus 1.The Union of India through the Secretary, Ministry of Coal having its office at Shastri Bhawan, Level 3, Rajpath, New Delhi - 110001, PO & PS, Rajpath, District New Delhi 2.The Central Vigilance Commission through its Commissioner having its office at Satarkta Bhawan, A-Block, GPO Complex, I.N.A. New Delhi-110023, PO & PS - I.N.A., District New Delhi 3.The Bharat Coking Coal Limited, a company registered under the Companies Act, 1956 and Government of India undertaking, through its Chairman cum Managing Director, having registered office at Koyla Bhawan, PO & PS Koyla Nagar, Dist. Dhanbad 4.The Chairman cum Managing Director, Bharat Coking Coal Limited, Koyla Bhawan, PO & PS Koyla Nagar, Dist. Dhanbad 5.The General Manager, Contract Management and Sales, Bharat Coking Coal Limited, Koyla Bhawan, PO & PS Koyla Nagar, Dist. Dhanbad 6.M/s. C1 India Pvt. Limited having its registered office at C-104, Sector 2, Noida, U.P.-201301, authorised service provider/agent of Respondent nos. 1 to 3 for the purpose of the connected tender process, through its Chairman, officiating from C-104, Sector-2, Noida, U.P.-201301, PO & District Noida (U.P.) 7.The Chairman, M/s. C1 India Pvt. Limited, officiating from C-104, Sector 2, Noida, U.P.-201301, PO & PS and District Noida (U.P.) 8.M/s. R. K. Transport Co. having its registered office at Navkaar Parisar, Pulgoan Naka, Durg, Chattisgarh-491001 ... ... Respondents --- For the Petitioner : M/s. Kalyan Bandhopadhyay, Senior Advocate & Kumar Sundaram, Advocate For the Respondent Nos. 1 & 2: Mr. Rajeev Sinha, ASGI For the Respondent Nos. 3 to 5:Mr. P. S. Narsimha, Additional Solicitor General of India & Mr. Anoop Kumar Mehta, Advocate For the Respondent Nos. 6 & 7: M/s. Sharad Kaushal & Bharat Kumar, Advocate For the Respondent No. 8 : M/s. Ratan Kumar Singh, Ayush Aditya & Shashank Shekhar, Advocate -2- --- Present: HON'BLE MR. JUSTICE RONGON MUKHOPADHYAY --- C.A.V. Order 16.08.2017
Heard Mr. Kalyan Bandopadhyay, learned senior counsel for the petitioner, Mr. P. S. Narsimha, learned Additional Solicitor General of India, Mr. Sharad Kaushal, learned counsel for the respondent nos. 6 & 7 as well as Mr. Ratan Kumar Singh, learned counsel for the respondent no. 8.
2. In this writ application, the petitioner has prayed for the following directions:
I. For directing them to award the work of NIT No. BCCL/GM/CMC/E-Tender/F-HEMM-OS/2015/312 dated 09.03.2015 for which the tender process was already concluded on 05.05.2015 at 13:03:58 hrs. in favour of the petitioner while declaring the bid of the petitioner as successful and L1.
II. For showing cause the respondents as to how, under what circumstances and under what provisions of the tender conditions, they could relax the conditions of clause 9 to favour the respondent no. 8 and to simultaneously oust the petitioner in utter violation of Article 14 when the auction process was already closed on 05.05.2015 at 13:03:58 hrs and the petitioner was already declared as successful and L1.
III. For quashing and setting aside the letter of LOA dated 30.05.2015 whereby and whereunder the tendered work in question of the above referred NIT has been sought to be awarded in favour of the respondent no. 8.
3. An amendment application in I.A. No. 5185 of 2015 was preferred by the petitioner which was allowed on 09.09.2015 by this Court and which is also included in the prayer made by the petitioner.
4. The facts of the case of that of the petitioner is that the petitioner is a consortium of M/s. AMR India Ltd. and M/s. Dev Prabha Construction Pvt. Ltd. M/s. AMR India Ltd. is engaged in large mining, irrigation, power, construction work etc. having an annual turn over of more than Rs. 3,000/- crores. M/s. Dev Prabha Construction Pvt. Ltd. is engaged in similar work and by executing an agreement dated 03.04.2015 formed a consortium namely, AMR - Dev Prabha in order -3- to join their forces, experience and expertise. The respondent - BCCL vide NIT No. BCCL/GM/CMC/E-Tender/F-HEMM-OS/2015/312 dated 09.03.2015 issued an e-tender for the work of hiring of HEMM (Heavy Earth Moving Machinery) for removal of over burden, extraction and transportion of coal with fire fighting from XIV, XII, XI/XII, XII, XI, IX/X, VIIIA, V/VI/VII/VIII, IV(T), IV(B), III, II, I(T) and I(B) seams at PATCH- DE (MEGA PROJECT) of Dhansar - ENA Colliery of Kusunda Area along with crushing of coal by portable crusher with an estimated value of Rs. 16,94,84,38,224/- from the bidders having requisite experience and eligibility. The petitioner being eligible and having requisites qualifications participated in the tender process along with the other bidders/tenderers. As per the tender notice dated 09.03.2015, the bid submission date started on 23.03.2015 at 10:00 hours and ended on 13.04.2015 at 17:00 hours and thereafter the bid was opened on 21.04.2015 at 16:00 hours. As per the tender notice after qualifying in Part I (Techno Commercial) bid, the petitioner was invited for reverse auction which was to be conducted online and in accordance with the terms and conditions mentioned in the bid document. The petitioner duly participated in the reverse auction conducted on 04.05.2015 which was to be conducted in terms of clause IX of the NIT and especially Clause 9(ix), 9(x), 9(xi), 9(xii) and 9(xiii). On 04.05.2015 which was the first date of reverse auction, the bid continued for the day and was paused as per the conditions enumerated in NIT at 18:00 hours and it was to be continued on the next date i.e., on 05.05.2015. It is the case of the petitioner that on the second day of the reverse auction, the petitioner duly submitted its reverse bid at 12:33:47 hours and since no other reverse bid of any other party was submitted in the next 30 minutes, the E auction process at 13:03:46 hours showed time remaining as 00:00:01 and as per the norms prescribed in the Clause 9 of the NIT, the process was declared as closed and the petitioner's bid was declared as successful and L1. It is further case of the petitioner in the writ application that since the website of E Tender showed the auction closed at 13:03:58 hours on 05.05.2015, the petitioner was declared as the successful bidder, but the respondent - BCCL authorities in connivance with the service provider and the respondent no. 8, relaxed the mandatory conditions as enumerated in Clause 9 of the NIT and resumed the E auction process which ultimately led to the -4- respondent no. 8 being declared as the successful bidder and work was awarded to respondent no. 8 on 09.03.2015 which is under challenge in the present writ application.
5. It has been stated by Mr. Kalyan Bandopadhyay, learned senior counsel for the petitioner that the respondent BCCL in active connivance with the service provider had maliciously got the E auction resumed which led to the respondent no. 8 being awarded the contract. Learned senior counsel submits that there was no occasion for the respondent - BCCL to get the E auction resumed as it is clear and categorical from Clause 9 of the Notice Inviting Tender that the conditions enumerated therein have to be rigorously followed and there is no question of any resumption of any E auction. Submissions have been advanced that the tender process closed after 30 minutes after the successful bid submitted by the petitioner at 12:33:47 hours, but even then the E tender process resumed only to shower benefit upon the respondent no. 8. The mala-fide action of the respondent - BCCL according to the learned senior counsel for the petitioner is conclusively proved on account of the resumption of the E auction as the same was resorted to in order to favour respondent no. 8. It has been submitted that once the tender process had already concluded, there was absolutely no occasion for resuming the tender process and granting letter of acceptance in favour of the respondent no. 8. Furthering his argument, Mr. Bandopadhyay has submitted that the relaxation of the conditions of bid are impermissible in law and even negligent mistakes in bid document cannot be permitted to be corrected on the basis of equity. Bharat Coking Coal Ltd. being a State within the meaning of Article 12 of the Constitution of India must be fair and non-discriminate in its attitude which however is clearly lacking as could be deciphered from the action of the respondent - BCCL in granting favour to the respondent no. 8. Learned senior counsel adds that the tender process has to be in conformity with Article 14 of the Constitution of India and it must also conform to the principles of non- arbitrariness. Argument has further been made that as per Clause 9 (IX) of the NIT, reverse auction was to be stopped if a particular bid remained unresponded for a continuous 30 minutes time. After the bid of the petitioner, the auction came to a close on expiry of 30 minutes which indicated that the petitioner was the successful bidder. Learned -5- senior counsel submits that after issuance of the letter of acceptance, the respondent - BCCL has not issued the work order nor they had entered into an agreement with the respondent no. 8. Learned senior counsel further submits that such blatant illegality needs to be corrected and an inquiry be set-up to take subsequent corrective measures and the petitioner be declared as the successful bidder while quashing the work order and the letter of acceptance dated 09.03.2015 and 30.05.2015.
6. Mr. P. S. Narsimha, learned Additional Solicitor General of India has raised a preliminary objection with respect to the principles of estoppel. He has stated that the petitioner has participated in the subsequent proceeding and therefore, he was precluded from challenging the issue in the present proceeding. It has been stated that the dispute had started on 05.05.2015 and the letter of acceptance was issued on 30.05.2015 whereas the writ petition was filed on 10.08.2015, as such, there was delay and latches on the part of the petitioner. It was submitted that it is not known as to why the petitioner kept silent for so long, although the letter of acceptance was issued on 30.05.2015. Learned senior counsel submits that if a judicial review is made, Rs. 170 crores have to be paid extra. Submissions have been advanced that the grievance which the petitioner is facing should have been addressed at the earliest and the delay is unpardonable and points to the fact that the petitioner does not have any case for interference by this Court. Learned ASGI further submits that there is no public interest involved in the present application. It has been stated that the credentials of the service provider C1 India Pvt. Ltd. is impeccable. It has further been submitted that C1 India casts various bidders at its website and it is backed by the server. The petitioner had availed of the alternative remedy by making a further presentation before the Independent External Monitor who after a detailed inquiry has submitted its inquiry report. This court as per the learned ASGI is only required to see as to whether the procedure of the tender process was transparent and reasonable and it is to be restricted itself only to the fairness of the decision making process and not beyond that. It has been stated that the independent body which conducted the inquiry comes under the Ministry of Communication and Information Technology, Government of India and could not detect any internal -6- interference, manipulation or interruption in the reverse E auction bid process running on the virtual server. While giving a broader outline of the arguments, he seeks to substantiate the same by various judicial pronouncements as also the factual aspects he has referred. On the question of suppression, it has been stated that the petitioner had suppressed the fact that he had placed as many as 12 bids after the auction process resumed. He has referred to paragraph 38 of the writ application by stating that it was an attempt made by the petitioner on the charge of suppression/obligation upon him to disclose the true and complete facts of the case. In support of his contention, learned ASGI has relied on the judgment passed in the case of "Prestige Lights Ltd. Vs. State Bank of India" reported in (2007) 8 SCC 449 as also in the case of "K. D. Sharma Vs. Steel Authority of India Ltd. & others" reported in (2008) 12 SCC 481.
7. With respect to the delay and latches on the part of the petitioner to the effect that although the auction resumed on 05.05.2015, the petitioner had approached this Court on 10.08.2015 without disclosing any justification for such delay. Further submission has been advanced that even after letter of acceptance was issued on 30.05.2015, the petitioner delayed challenging the process or the decision taken by more than 2 months. It has been stated that the letter of acceptance is treated as a concluded contract between the parties. In support of his contention, learned senior counsel has referred to the case of "Raunaq International Ltd. Vs. IVR Construction Ltd. & others" reported in (1999) 1 SCC 492. The preliminary objection which has been raised by the learned ASGI is with respect to the petitioner being barred by the principles of estoppel on the ground that though the challenge has been made to the resumption of the auction process, but the petitioner had willingly participated in the resumed auction process and had never raised any sort of objection at that point of time. It has been stated that after issuance of the letter of acceptance to the respondent no. 8 - M/s. BCCL in compliance with the terms and conditions of the NIT has duly returned the earnest money deposited to the unsuccessful bidder which included the petitioner also. The return of the bank guarantee was never protested or objected to by the petitioner. Learned ASGI has also submitted that if there was a technical fault, the auction was -7- permissible to be resumed for the paused period for which he has referred to Clause 9 (XIII) of the NIT. The petitioner after resumption has submitted 12 bids and even in the extended period, it had submitted 8 bids without any protest or objection. Submissions have been advanced that the petitioner is estopped by virtue of the principles of estoppel to challenge the auction process as he cannot be permitted to approbate and reprobate at the same breath. The contention of the petitioner that he was declared as L1 bidder at 13:03 hours is based on a wrongful assumption as the petitioner was also well aware of the resumption of the auction process, since it had participated in it whole heartedly without there being any sort of objection made on its behalf. In support of such contention reference has been made to the case of "THDC India Ltd. Vs. Voith Hydro GMBH Company & Anr" reported in (2011) 4 SCC 756. So far as the question of public interst is concerned, submission has been advanced that the bid offer of the petitioner being Rs. 2213 lacs is higher by Rs. 170 crores, if compared to the offer made by respondent no. 8 and the same is totally against the public interest as it would cost the State an enormous amount of Rs. 170 crores. It has therefore been submitted that since there is no public interest involved in the writ application and the same is in fact against the public interest, on such score also, the writ application is liable to be dismissed and in support of such contention reference has been made to the case of "Rajasthan Housing Board & Anr. Vs. G. S. Investments & Anr." reported in (2007) 1 SCC 477 as well as to the case of "Jagdish Mandal Vs. State of Orissa & Ors." reported in (2007) 14 SCC 517.
8. The question of alternative remedy has also been vehemently argued by the learned ASGI as in terms of contractual remedy under Clause 6(H) of the Tender document read with Section 8 of the terms and conditions of the E tender documents, the petitioner had approached the independent external monitor raising the very same grounds which has been taken in the present writ application and had also apart from appearing before the IEM had argued the matter in detail and had also filed written submissions. It has thus been submitted that having invoked the alternative remedy available to him under the contract, the petitioner cannot be permitted to raise the same issue before this Court.
-8-9. Finally, while coming to the merits of the case it has been stated that the issue relating to the findings of fact concerning system failure is highly technical in nature and the complaint made before the independent external monitor and their reports were placed before the CMD of BCCL which was considered and a decision was taken. As regards the delay in submitting the bank guarantee, submission has been advanced that as per the relevant clause, the successful bidder was to deposit the bank guarantee within 28 days from the receipt of the letter of acceptance, but before the expiry of the said period representation was submitted by the respondent no. 8 for extension of time by 2 months and the delay was condoned by the Chairman cum Managing Director vide its decision dated 22.09.2015. It has further been stated that the issuance of letter of acceptance is a concluded contract between the parties by virtue of Clause 23.2 of NIT and therefore, once the contract comes into force, the rights and liabilities of the parties will be confined to the terms and conditions of the specific contract. It has been concluded by the learned Additional Solicitor General of India that the factual and legal aspects do not point to any right of the petitioner in challenging the decision taken by respondent - BCCL in allotting the work order in favour of the respondent no. 8 and issuing the letter of acceptance in its favour and therefore, the present writ application is liable to be dismissed.
10. Mr. Kalyan Bandopadhyay, learned senior counsel appearing on behalf of the petitioner replying to the contentions advanced by the learned ASGI has stated that the question of estoppel which has been sought to be raised by the learned counsel for the respondent nos. 3 to 5 cannot be decided as a preliminary issue. He has once again referred to the conditions of the NIT and had stated that an illegality having been committed the rule of law has to be established by correcting such illegality. In support of his contention, learned senior counsel has referred to Clause 9(IV), (V), (XII) and (XIII) of the NIT. Reference has also been made to the business rules and it has been stated that Clause 9 (IX) of the NIT has to be read with Clause VII of the business rules. It has been stated that Clause 7 specifies that on the second day of the auction, no auto extension will be given after 18:00 hours on the second day of the auction. Learned senior counsel has also made a reference to the screenshot of the auction held on the -9- second day which indicated that on 05.05.2015, the time remaining for the auction to close was 1 second and the auction was subsequently shown to be closed and it was never shown to be paused. It has therefore been submitted that the resumption of the bid after closure of the auction is an illegal act on the part of the respondent - BCCL in connivance with the service provider and the respondent no. 8. Reference has also been made to the counter affidavit of the BCCL by stating that nowhere it has been mentioned as to with whom the consultation was made in the office of the Chairman cum Managing Director. No disclosure from any of the bidders as to whether any complaint has been made with respect to the technical snag purported to have disrupted the auction process has been made and the averments made in the third supplementary counter affidavit by the BCCL is not the actual fact. It has been stated that if the process was closed on 01:03 PM, how could the respondents have stated that the system was affected from 12:55 to 01:05 PM. Further submission has been advanced that Clause 9 (XIII) is for the service provider and not for the BCCL. It has been submitted that the statement that there is no requirement for the service provider to consult BCCL is totally contradictory. Learned senior counsel thus submits that whether in the given circumstances, the doctrine of estoppel will lie. Referring to the supplementary affidavit filed by the petitioner, much stress has been given to the report of the independent external monitor who had concluded that there is no system failure and resumption of reverse auction was not a fair decision. Reference has also been made to the second supplementary counter affidavit of the respondent nos. 3 to 5 which includes a copy of the independent external monitor which suggested that the resumption of the reverse auction was in order. Learned senior counsel further submits that several questions were formulated by the other independent external monitor, but all the questions were irrelevant and beyond his purview. Question has been raised with respect to the jurisdiction of the other Independent External Monitor (IEM) with respect to answering the question which was beyond his purview as he could not have usurped the jurisdiction of the Court. Learned senior counsel further submitted that Clause 9 (IX) has to be given a strict interpretation and no relaxation on the said condition is permissible in law and therefore, no bid could have been -10- continued after 18:00 hours. Learned senior counsel has referred to the order of this Court passed in the writ application specifically to the order dated 18.08.2015 wherein it was directed that the respondent no. 8 shall not execute the agreement. In support of the various contentions, learned senior counsel has referred to the judgments in the cases of -
"Olga Tellis and others Vs. Bombay Municipal Corporation & others" reported in (1985) 3 SCC 545;
"Nar Singh Pal Vs. Union of India & others" reported in (2000) 3 SCC 588;
"W. B. State Electricity Board Vs. Patel Engineering Co. Ltd. & others" reported in (2001) 2 SCC 451;
"Jagdish Mandal Vs. State of Orissa & others" reported in (2007) 14 SCC 517;
"Ashoka Smokeless Coal India (P) Ltd. & others Vs. Union of India & others" reported in (2007) 2 SCC 640;
"Himachal Pradesh Housing and Urban Development Authority Vs. Universal Estate and Anr" reported in (2010) 14 SCC 253;
"Dutta Associates Pvt. Ltd. Vs. Indo Merchantiles Pvt. Ltd. & others" reported in (1997) 1 SCC 53;
"B. S. Minhas Vs. Indian Statistical Institute & others"
reported in (1983) 4 SCC 582;
"Roots Industries India Ltd. Vs. Airports Authority of India & others" reported in (2016) 3 SCC 569;
"Tata Cellular Vs. Union of India" reported in (1994) 6 SCC
651.
11. So far as the respondent - BCCL is concerned, apart from bolstering his argument with the judicial pronouncements referred to above, reliance has also been placed in the cases of -
"THDC India Ltd. Vs. Voith Hydro GMBH Company & Anr"
reported in (2011) 4 SCC 756;
"Prestige Lights Ltd. Vs. State Bank of India" reported in (2007) 8 SCC 449;
"K. D. Shrama Vs. Steel Authority of India Ltd. & Others"
reported in (2008) 12 SCC 481;
-11-"Rajasthan Housing Board & Anr. Vs. G. S. Investments & Anr." reported in (2007) 1 SCC 477;
"Jagdish Mandal Vs. State of Orissa & Ors." reported in (2007) 14 SCC 517;
"Michigan Rubber (India) Ltd. Vs. State of Karnataka & Anr."
reported in (2012) 8 SCC 216;
"Raunaq International Ltd. Vs. IVR Construction Ltd. & others" reported in (1999) 1 SCC 492, as well as the order passed by the Bombay High Court in the case of "Arunoday Magaswargiya Mazdoor Kamgar Sahakari Sanstha, Ltd., Walni Vs. State of Maharashtra and Others" reported in 2013(2) Mh.L.J.
12. Learned counsel for the respondent no. 8 has apart from adopting the argument advanced on behalf of respondent nos. 3 to 5 has stated that the reverse auction process had suddenly got interrupted at 1:00 PM on account of technical failure at the end of the service provider for which an email was sent which was acknowledged by the service provider with respect to the technical snag which had occurred. It has been stated as regards non-furnishing of the performance guarantee within a period of 28 days as per the terms and conditions of the NIT, that the letter dated 07.07.2015 submitted by the respondent no. 8 mentions about the reasons regarding the delay and an extension of 2 months was sought for. Learned counsel further submits that on 30.07.2015 and 11.08.2015, the General Manager, Kusunda Area, BCCL has requested respondent no. 8 to submit the bank guarantee immediately and pursuant to the same on 27.08.2015, the bank guarantee was submitted by the respondent no. 8. Learned counsel submits that after the letter of acceptance was issued in its favour, huge amount has been expended towards infrastructural set- up. It has also been stated that the bid of the respondent no. 8 was much less than that of the petitioner and considering the entire scenario, the present application is liable to be dismissed.
13. On consideration of the submissions advanced by the learned counsel for the respective parties, it is to be seen as to whether the decision making process was fair, rational, reasonable or whether the same suffers from arbitrariness and unfairness.
14. The crux of the issue is the notice inviting E tender dated
09.03.2015. The stand taken by the respective parties has to be -12- considered in the backdrop of the terms and conditions of the notice inviting tender. Clause 9 of the NIT deals with the opening of the bid and it stipulates at Sub-clause 4 that after opening of the price bid, the system will evaluate each bid by multiplying the quantity with the unit rate quoted for the respective items. It further stipulates that the overall quoted lowest price along with the details of rate and amount of each item will be displayed by the system without disclosing the name of the bidder during reverse auction. At Sub-clause 5, it was mentioned that the reverse auction will be carried out as per the terms and conditions of the Annexure M and the bidder must comply with the requirement of Annexure M. The primary Sub-clause of Clause 9 which has been relied upon by both the sides are Sub-clauses VIII, IX, XII and XIII, which are quoted hereinunder:
9(viii) "The lowest bidder has to email a scanned copy of the duly signed filled-in prescribed formal for Price Bid Breadup (Form - III of Annexure M) to service provider within 2 Hours of the conclusion of the Auction. Any variation between the on-line bid value and signed document will be considered as sabotaging the auction process and will invite disqualification of vender to conduct business with BHARAT COKING COAL LIMITED as per prevailing procedure.
(ix) By default 11:00 hrs. of the scheduled date of Reverse Auction will be the start time of Reverse Auction. The Reverse Auction will remain open for 4 houses i.e., from 11:00 hrs. to 15:00 hrs. on the scheduled date. However, the bidding time will go on extending automatically after 15:00 hrs. in the slab of 30 minutes each from latest bid time, if the latest response in the bidding is submitted within last 30 minutes of scheduled extended closing time of bidding. The reverse auction will be paused on 18:00 hours for the first day. The Reverse Auction will again be continued on the 2nd day from 11:00 hrs. as per the norms followed after 15:00 hrs. on the first day of the Reverse Auction. The process of Reverse Auction will finally stop sharp at 18:00 hrs. on the 2nd day.-13-
The Reverse Auction will also stop in case the particular bid remains unresponded for continuous 30 minutes time between 15:00 hrs. to 18:00 hrs. in the 1st day and 11:00 hrs. to 18:00 hrs. in the 2nd day.
(xii) The Service provider of e-Tendering will take all necessary steps to ensure smooth and uninterrupted functioning of system at their end. Bidders are advised to ensure stable connectivity at their end. Service provider or BCCL will not be responsible for any disruption or connectivity or any failure at bidders end.
(xiii) Manual extension of bidding time will not be allowed at the request of bidder. In case there is any technological or system failure at service provider's end the bidding will be paused and it will get extended for the period, the system remained down."
15. The validity of the bid has been mentioned at Clause XI which states that the bid shall remain valid for a period of 120 days from the date of opening of Part I bid. As regards the performance guarantee, the same has been stipulated in Clause 4.3 in the general terms and conditions of the contract which states that failure of the successful bidder to comply with the requirement as noted in the preceding, conditions enumerated in Clause 4.3 shall constitute sufficient ground for cancellation of the Award of Work and forfeiture of the bid security. However, the same seems to have been relaxed by the subsequent condition that if the contractor fails to submit the performance security within 28 days of receipt of letter of acceptance due to some reasons or otherwise and if the management takes it to be reasonable, this period of within 28 days of receipt of LOA may be waived and the agency can be allowed to submit the performance guarantee upto an extended period as deemed fit with the approval of CMD, BCCL. The integrity pact between the Principal and the bidder which is Annexure 8 to the terms and conditions of the contract reveals that since the monitor notices or believes to notice violation of this agreement, he would so inform the management of the Principal and request the management to discontinue or heal the violation or to take other relevant action. It further goes on to add that the monitor can in this -14- regard submit non-pointing recognition and beyond this the monitor has no right to demand from the parties that the act in a specific manner refrain from action or tolerate action. The business rules for reverse action specifies in Clause 7, the auto extension of bid time and it reads as follows:
7 "Auto Extension of Bidding Time: Initial time of Reverse auction will be 11:00 to 15:00 hours. If a bidder places a bid in the last 30 minutes of closing of the Reverse Auction and if that bid gets accepted, then the auction's duration shall get extended automatically for another 30 minutes, for the entire auction (i.e. for all the items in the auction), from the time that bid comes in. Please note that the auto-extension will take place only if a bid comes in those last 30 minutes and if that bid gets accepted. If the bid does not get accepted, the auto-extension will not take place even if that bid might have come in the last 30 minutes. In case, there is no bid in the last 30 minutes of closing of Reverse Auction, the auction shall get closed automatically without any extension. However, this extension process will continue up to 18:00 Hours on the 1st day of bidding day. The reverse bidding will again be continued on the 2nd day from 11:00 hrs. As per the norms followed after 15:00 hrs. on the first day of the reverse bidding. The process of reverse bidding will finally stop sharp at 18:00 hrs. On the 2nd day. No auto extension will be given after 18:00 hrs. of second day of bidding."
16. Clause 10 of the terms and conditions of the reverse auction reveals that neither the service provider which in this case was C1 India Pvt. Ltd. nor M/s. BCCL shall have any liability to bidders for any interruption or delay in excess to the site irrespective of the cause. The E auction which was held on 04.05.2015 which is the first day of the auction was paused at 18:00:16 hours. The petitioner had relied on a screenshot that the time remaining for the auction to be closed is 00:00:01. Since the respondent no. 8 on resumption of the reverse auction has been successful, he was declared L1 and vide letter dated 30.05.2015, it was issued the work order and it was advised to furnish -15- performance guarantee/security to be deposited within 28 days from the date of receipt of the letter of auction. The petitioner has mainly relied on Clause 9 of the NIT that the auction will stop in case a particular bid remained unresponded for a continuous 30 minutes time between 15:00 hours to 18:00 hours on the first day and 11:0 hours to 18:00 hours on the second day. The petitioner has contended that since after the petitioner had made the bid and since the same remained unresponded for a period of 30 minutes continuously, the BCCL does not have any option, but to declare the petitioner as the successful bidder being L1. The said contention of the petitioner has been vociferously countered by the learned ASGI as has been indicated in the preceding paragraphs. Since the auction process had stalled on account of technological glitches which had occurred and was interrupted at the end of the service provider, the respondent no. 8 had sent an email which was also acknowledged by the service provider which can be detected from the email sent by the respondent no. 8 to the respondent - BCCL to which reply was sent to the respondent no. 8 that on account of unexpected occurrence at the auction server, the auction get interrupted on 01:03 PM and got closed. It was further intimated to the respondent no. 8 that the auction will get restarted at 2:30 PM and the remaining time between closure time of the auction and resuming time of the auction will be provided if the auction will reach in the extension time past 6 PM. Basically the gist of the mail dated 05.05.2015 sent to the respondent no. 8 is in adherence to the terms and conditions of the NIT with respect to giving extra time for making up the loss due to the technical snag which had occurred. It appears that the auction process was resumed on 05.05.2015 at 2:30 PM and the bidders including the petitioner and the respondent no. 8 had participated and it went beyond the schedule closure of 18:00 hours and was finally stopped at 19:27 hours when the respondent no. 8 was declared as the successful bidder. The NIT document reveals that C1 India Pvt. Ltd. was selected as the service provider to provide electronic tendering. The service provider under the terms and conditions of the NIT had the authority to restart and resume the reverse auction process without seeking permission without any authority of the BCCL and could have extended the time for reverse auction if there was an interruption or disruption. In the said context, it -16- would be necessary to refer to the counter affidavit filed on behalf of respondent nos. 6 & 7 which is M/s. C1 India Pvt. Ltd. The respondent nos. 6 & 7 have claimed that C1 India Pvt. Ltd. is a pioneer in developing E procurement solution as per the process followed by the Central Government, State Government and Public Sector Undertakings. The solutions developed and implemented by C1 India Pvt. Ltd. according to them have been independently audited for security by Price Water House Cooper and Standardising, Testing and Quality certification (STQC), a Directorate attached to the Ministry of Communication and Information Technology, Government of India. In the said affidavit, it has been stated that the help desk of C1 India Pvt. Ltd. had received calls from the participating bidders on 05.05.2015 between 12:35 to 13:00 hours that they were facing problems in submitted their bid. The initial study was carried out which revealed that due to intermittent bandwidth problem, the auction server has become unresponsive which led to data packet loss. It further appears from the said affidavit that the BCCL servers were hosted in the Tata Telecommunication Ltd., data centre which is equipped with control power high bandwidth cooling system physical security and excess control. After the rectification of the technical fault in the data centre of TCL, the E auction was resumed and proper communication was made to all the bidders and 1 hour 27 minutes time was extended beyond the scheduled closing time. On a report of a complaint made by the petitioner with respect to the resumption of the auction process inquiry was conducted by the Independent External Monitor namely, Sri L. N. Singhi who had come to a conclusion that C1 India Pvt. Ltd. could prove the interruption caused in the system during the auction process and as such, the resumption of reverse auction on 05.05.2015 was in accordance with the procedure specified in the NIT. A further finding has been given that prior to the respondent no. 8 reporting about the disruption in the auction process to either BCCL or to C1 India Pvt. Ltd., C1 India Pvt. Ltd. had already sent an email to Tata Communication at 12:59 hours informing them about the disruption in the system. A contrary view has been taken in the report of another Independent External Monitor namely, Sri N. Chaturvedy who had submitted a report on 23.09.2015 in which he had come to a conclusion that there was no system failure as alleged and the -17- resumption of reverse auction was a fair decision. A comparison of the separate reports submitted by the independent external monitors does reveal that the report of L. N. Singhi seems to be a much more comprehensive and reasoned report than compared to the subsequent report of Sri N. Chaturvedy. Although at some places in the report submitted by Sri L N. Singhi, he appears to have gone beyond his jurisdiction, but on a careful look and comparison of both the reports, confidence would clearly be placed on the report submitted by Sri L N. Singhi.
17. From the averments made in the various petitions filed on behalf of the parties, it is an admitted fact that the petitioner after resumption of the auction process had duly and actively participated even during the extended time of 01:27 hours. During the extended period, the petitioner had submitted 8 bids.
18. Since the independent external monitors had differed in their views, respondent - BCCL had sent a request letter to the Director General, Computer Emergency, Response Team, India which is an independent body under the Ministry of Communication and Information Technology, Department of Electronics and Information Technology to conduct an audit on the reverse auction on the server of C1 India Pvt. Ltd. posted at Tata Telecommunication Ltd., Data Centre from 12:30 PM onwards on 05.05.2015. The Director General, CERT- IN had sent a letter dated 28.12.2015 in connection with the said investigation enclosing the incident report which has been brought on record. The critical observation which have been made and the conclusion in the incident analysis report are as follows:
Critical Observations "During the crucial period of the dual fiber cable cut, the bandwidth available to the bidders was extremely low, but it was never zero and this was the reason that the bidders were not able to submit their bids during this period. Same is also evident from the graphics provided by M/s. Tata Communications Ltd.
M/s. BCCL has reported to M/s C1 India Pvt. Ltd. that the bidders have complained that they are not able to submit their bids. However, M/s. C1 India Pvt. Ltd. did not pause the running of the Reverse Auction -18- Bidding application, which resulted in the start of the reverse auction closure process automatically at 13:03:47 hrs., i.e., automatically scheduled after 30 minutes of the last bid at 12:33:47 hrs. by M/s. Amar Dev Prabha Consortium."
Conclusion By the aforesaid analysis following is evident:
1. During the crucial period i.e. from 12:50 hours to 13:05 hours the bandwidth available to the bidders was very low and web access logs shows that all the bidders had faced problem in connecting to the server running the web application, which could be due to dual fiber cable cut as reported by M/s. Tata Communications Ltd.
and also evident from the various graph provided by them. However it was noticed after the analysis of the web access logs that the webserver connectivity problem was severe for (I) M/s. Madhucon Projects Ltd.,
(ii) M/s. R K Transport Co. and (iii) M/s. Dhansar Eng. Co. Pvt. Ltd; while for the other three, namely (I) M/s. Montecarlo Ltd., (ii) M/s. Amar Dev Prabha Consortium, and (iii) M/s. Ambey Mining Pvt. Ltd. faced the same problem intermittently.
2. The service provider, M/s. C1 India Pvt. Ltd. was well connected to the server running the web application throughout the reverse auction process including the crucial period, i.e. from 12:50 hrs. to 13:05 hrs., since they were connected to the data centre running the server through lease line. So, they did not face any difficulty at all to connect to the server. However, even after receiving the complaint from BCCL about the problem faced by the bidders in submitting their bids, M/ s. C1 India Pvt. Ltd. did not pause the Reverse Auction Application running on the served which led to closure of the reverse auction bidding process during the crucial period.
3. By careful examination and analysis of the logs, as provided to CERT-IN by M/s. C1 India Pvt. Ltd., -19- CERT-IN could not find any external interference, manipulation or interruption to the Reverse e-Auction Bidding Application running on the virtual server."
19. The report therefore, revealed that the web server connectivity problem was severe for some of the bidders including the respondent no. 8 and intermittent for some of the bidders including the petitioner. The analysis report further revealed that in spite of receiving complaints regarding the problem faced by the bidders in submitting their bids, C1 India Pvt. Ltd. did not pause the reverse auction application running on the server which led to closure of the reverse auction bidding process during the crucial period. Analysis report of CERT-IN conclusively proves that the reverse auction which was held on 05.05.2015 was not running smoothly which led to severe connectivity problem for the respondent no. 8 as well as for some other bidders. Adverting back to the terms and conditions of the NIT, Clause 9 (xiii) gives the power of extension in case of any technological or system failure at the service provider end and it will get extended for the period, the system remained down. The resumption of the reverse auction after the technical snag was corrected was in accordance with the terms and conditions of the NIT. Therefore, the act of resumption of the reverse auction process being in conformity with the terms and conditions of the NIT and being without doubt was on account of the technological failure which on being detected led to resumption of the reverse auction, the said process cannot be called into question. The procedure which had been followed to ensure fair impartial and a level playing field to the participants of the tender was a justifiable action on the part of the respondent - BCCL.
20. In the case of "Olga Tellis and others Vs. Bombay Municipal Corporation & others" reported in (1985) 3 SCC 545 (supra), the question of estoppel had been dealt with and it has been held as follows:
29. "The plea of estoppel is closely connected with the plea of waiver, the object of both being to ensure bona fides in day-to-day transactions. In Basheshar Nath v. CIT a Constitution Bench of this Court considered the question whether the fundamental rightsconferred by the Constitution can be waived. Two members of the Bench (Das, C.J. and Kapoor, J.) held that there can be no waiver of the fundamental right -20- founded on Article 14 of the Constitution. Two others (N.H. Bhagwati and Subba Rao, JJ.) held that not only could there be no waiver of the right conferred by Article 14, but there could be no waiver of any other fundamental right guaranteed by Part III of the Constitution. The Constitution makes no distinction, according to the learned Judges, between fundamental rights enacted for the benefit of an individual and those enacted in public interest or on grounds of public policy."
21. In the case of "Nar Singh Pal Vs. Union of India & others"
reported in (2000) 3 SCC 588 (supra) which has been referred to by the learned senior counsel for the petitioner in order to answer the submission of learned ASGI that when the petitioner had participated in the resumption of the E auction, he was precluded from challenging the same, it was held as follows:
13. "The Tribunal as also the High Court, both appear to have been moved by the fact that the appellant had encashed the cheque through which retrenchment compensation was paid to him. They intended to say that once retrenchment compensation was accepted by the appellant, the chapter stands closed and it is no longer open to the appellant to challenge his retrenchment. This, we are constrained to observe, was wholly erroneous and was not the correct approach.
The appellant was a casual labour who had attained the "temporary" status after having put in ten years of service. Like any other employee, he had to sustain himself, or, maybe, his family members on the wages he got. On the termination of his services, there was no hope left for payment of salary in future. The retrenchment compensation paid to him, which was only a meagre amount of Rs 6350, was utilised by him to sustain himself. This does not mean that he had surrendered all his constitutional rights in favour of the respondents. Fundamental Rights under the Constitution cannot be bartered away. They cannot be compromised nor can there be any estoppel against the exercise of Fundamental Rights available under the Constitution. As pointed out earlier, the termination of the appellant from service was punitive in nature and was in violation of the principles of natural justice and his constitutional rights. Such an order cannot be sustained."
22. In the case of "W. B. State Electricity Board Vs. Patel Engineering Co. Ltd. & others" reported in (2001) 2 SCC 451 (supra), the question of public interest was considered and it was held as follows:
-21-24. "The controversy in this case has arisen at the threshold. It cannot be disputed that this is an international competitive bidding which postulates keen competition and high efficiency. The bidders have or should have assistance of technical experts. The degree of care required in such a bidding is greater than in ordinary local bids for small works. It is essential to maintain the sanctity and integrity of process of tender/bid and also award of a contract. The appellant, Respondents 1 to 4 and Respondents 10 and 11 are all bound by the ITB which should be complied with scrupulously. In a work of this nature and magnitude where bidders who fulfil prequalification alone are invited to bid, adherence to the instructions cannot be given a go-by by branding it as a pedantic approach, otherwise it will encourage and provide scope for discrimination, arbitrariness and favouritism which are totally opposed to the rule of law and our constitutional values. The very purpose of issuing rules/instructions is to ensure their enforcement lest the rule of law should be a casualty. Relaxation or waiver of a rule or condition, unless so provided under the ITB, by the State or its agencies (the appellant) in favour of one bidder would create justifiable doubts in the minds of other bidders, would impair the rule of transparency and fairness and provide room for manipulation to suit the whims of the State agencies in picking and choosing a bidder for awarding contracts as in the case of distributing bounty or charity. In our view such approach should always be avoided. Where power to relax or waive a rule or a condition exists under the rules, it has to be done strictly in compliance with the rules. We have, therefore, no hesitation in concluding that adherence to the ITB or rules is the best principle to be followed, which is also in the best public interest."
23. Strict adherence has to be made with the guidelines/terms and conditions of the contract and there cannot be any dilution of the same is the essence of the said judgment referred to by the learned senior counsel for the petitioner. In the case of "Jagdish Mandal Vs. State of Orissa & Ors." reported in (2007) 14 SCC 517 (supra), the question of judicial review was under consideration and reference has been made to the following paragraphs:
22. "Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and mala fides. Its purpose is to check whether choice or decision is made "lawfully"
and not to check whether choice or decision is "sound". When the power of judicial review is invoked in matters relating to tenders or award of contracts, certain special features should be borne in mind. A contract is a commercial transaction. Evaluating tenders and -22- awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona fide and is in public interest, courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review, should be resisted. Such interferences, either interim or final, may hold up public works for years, or delay relief and succour to thousands and millions and may increase the project cost manifold. Therefore, a court before interfering in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions:
(i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone;
OR Whether the process adopted or decision made is so arbitrary and irrational that the court can say: "the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached";
(ii) Whether public interest is affected.
If the answers are in the negative, there should be no interference under Article 226. Cases involving blacklisting or imposition of penal consequences on a tenderer/contractor or distribution of State largesse (allotment of sites/shops, grant of licences, dealerships and franchises) stand on a different footing as they may require a higher degree of fairness in action.
24. The tender conditions give an option to the tenderer, to furnish earnest money deposit, by pledging NSC/postal time deposit/postal saving passbook/deposit receipts issued by any nationalised bank. The first respondent pledged a postal TD account passbook relating to a deposit of Rs 1,70,000 in fulfilment of the condition regarding EMD. The Department is entitled to verify the genuineness of the TD passbook to ensure that the required EMD is furnished. In this case, even before the Committee could consider the tenders, a complaint was also received alleging that the TD passbook produced by the fifth respondent was tampered and manipulated. It was therefore but natural for the Department to seek -23- confirmation from the Postal Department as to whether the TD passbook was genuine and valid. Its query elicited a reply from the Superintendent of Post Offices that the term deposit passbook for Rs 1,70,000 produced by the fifth respondent was not to be acted upon. Therefore, the Committee concluded that the tender of the fifth respondent was defective as not being accompanied by a valid EMD. It cannot be said that the Committee acted unreasonably and arbitrarily, in arriving at the said decision. The Committee did not send show-cause notice to the fifth respondent before rejecting the TD passbook and consequently the tender, as Clause 3.5.18 of the Code makes it clear that acceptance of any tender is entirely at the discretion of the accepting authority and no tenderer can require the authority to show cause for rejection of the tender.
28. The limited scope of judicial review by the High Court envisaged examination of the question whether there was any material irregularity in the decision- making process or whether the decision of the Committee and consequential rejection of fifth respondent's tender was irrational, unreasonable or arbitrary. The validity of the decision of the Committee taken on the material available at the time of consideration of tenders, cannot be tested with reference to a subsequent police enquiry report submitted in the writ proceedings. Nor can it be held that the Committee acted arbitrarily in not accepting the passbook, on the basis of some report opining that the TD passbook is genuine. The High Court was not sitting in appeal over the decision of the Committee. The High Court could not, therefore, by relying on a subsequent police enquiry report, the correctness of which is yet to be established, hold that the Tender Committee was wrong in rejecting the TD passbook. Further, the High Court missed the issue. The question for consideration was not whether the TD passbook pledged by the fifth respondent is genuine or not. The question for consideration was whether the Committee acted arbitrarily or irrationally in rejecting the said TD passbook."
24. In the case of "Ashoka Smokeless Coal India (P) Ltd. & others Vs. Union of India & others" reported in (2007) 2 SCC 640 (supra), it was held as follows:
91. "The State, however, while distributing its largesse at a price, if involved in distribution of a commodity, which would attract the provision of Article 39(b) of the Constitution of India, would stand on a different footing.
113. The State or a public sector undertaking plays an important role in the society. It is expected of them that -24- they would act fairly and reasonably in all fields; even as a landlord of a tenanted premises or in any other capacity. (See Baburao Shantaram More v. Bombay Housing Board SCR at p. 577, Dwarkadas Marfatia & Sons v. Board of Trustees of the Port of Bombay SCR at pp. 760, 762 and Pathumma v. State of Kerala SCR at p. 545.)"
25. Learned senior counsel for the petitioner has also referred to the case of "Himachal Pradesh Housing and Urban Development Authority Vs. Universal Estate and Anr" reported in (2010) 14 SCC 25 (supra), in which it was held that the State and its instrumentalities are bound to adhere to the norms, standards and procedures laid down by them and cannot depart from them arbitrarily. It was further held therein that the decision making process can be examined by the Court, though the decision is not amenable to judicial review. In the case of "Dutta Associates Pvt. Ltd. Vs. Indo Merchantiles Pvt. Ltd. & others" reported in (1997) 1 SCC 53 (supra), it was held that the consideration of the tender received and the procedure to be followed in the matter of acceptance of a tender should be transparent, fair and open, while a bona-fide error or error of judgment would not certainly matter in abuse of power for extraneous reasons. Strict adherence to the terms and conditions of the contract has once again be reiterated in the case of "B. S. Minhas Vs. Indian Statistical Institute & others"
reported in (1983) 4 SCC 582 (supra), and the relevant paragraphs are quoted hereinunder:
23. "The next question that arises for consideration is whether the appointment of Respondent 4 as Director of Respondent 1 is illegal because of non-compliance with bye-law 2. Bye-law 2 does require that before appointment, the vacancy in the post of Director should be suitably publicised. In the instant case, it is admitted on both sides that no publicity whatsoever was given in respect of the vacancy. The contention of Shri Garg, however, is that the bye-law having no force of statute, non-compliance with its requirement cannot in any way affect the appointment of Respondent 4 as Director of Respondent 1. Shri Tarkunde, however, contended that assuming that the bye-law is not statutory, even so Respondent 1 was bound to comply with it. In support of his contention he strongly relied upon Ramana Dayaram Shetty v. International Airport Authority of India. The Court in that case held: (SCC p. 503, para
10) "It is a well-settled rule of administrative law that an executive authority must be rigorously held -25- to the standards by which it professes its actions to be judged and it must scrupulously observe those standards on pain of invalidation of an act in violation of them. This rule was enunciated by Mr Justice Frankfurter in Vitarelli v. Seaton where the learned Judge said:
An executive agency must be rigorously held to the standards by which it professes its action to be judged.... Accordingly, if dismissal from employment is based on a defined procedure, even though generous beyond the requirements that bind such agency, that procedure must be scrupulously observed.... This judicially evolved rule of administrative law is now firmly established and, if I may add, rightly so. He that takes the procedural sword shall perish with the sword.'"
The aforesaid principle laid down by Mr Justice Frankfurter in Vitarelli v. Seaton has been accepted as applicable in India by this Court in Amarjit Singh Ahluwalia v. State of Punjab and in subsequent decision given in Sukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi. Mathew, J. quoted the above-referred observation of Mr Justice Frankfurter with approval.
24. In view of the pronouncement of this Court on the point it must be held to be obligatory on the part of Respondent 1 to follow the bye-laws, if the bye-laws have been framed for the conduct of its affairs to avoid arbitrariness. Respondent 1 cannot, therefore, escape the liability for not following the procedure prescribed by bye-law 2."
26. In the case of "Roots Industries India Ltd. Vs. Airports Authority of India & others" reported in (2016) 3 SCC 569 (supra), it was held that even though the tender/bid process had been finalised and contract awarded to another while writ petitioner was in the process of challenging rejection of its bid is not a ground on which a writ petition can be dismissed. The question of judicial review in government contracts has come up for consideration before the Hon'ble Supreme Court in the case of "Tata Cellular Vs. Union of India" reported in (1994) 6 SCC 651 (supra), in which it was decided and held as follows:
70. "It cannot be denied that the principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. However, it must be clearly stated that there are inherent limitations in exercise of that power of judicial review. Government is the guardian of the finances of the State. It is expected to -26- protect the financial interest of the State. The right to refuse the lowest or any other tender is always available to the Government. But, the principles laid down in Article 14 of the Constitution have to be kept in view while accepting or refusing a tender. There can be no question of infringement of Article 14 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. Of course, if the said power is exercised for any collateral purpose the exercise of that power will be struck down.
71. Judicial quest in administrative matters has been to find the right balance between the administrative discretion to decide matters whether contractual or political in nature or issues of social policy; thus they are not essentially justiciable and the need to remedy any unfairness. Such an unfairness is set right by judicial review.
73. Observance of judicial restraint is currently the mood in England. The judicial power of review is exercised to rein in any unbridled executive functioning.
The restraint has two contemporary manifestations. One is the ambit of judicial intervention; the other covers the scope of the court's ability to quash an administrative decision on its merits. These restraints bear the hallmarks of judicial control over administrative action.
75. In Chief Constable of the North Wales Police v. Evans Lord Brightman said:
"Judicial review, as the words imply, is not an appeal from a decision, but a review of the manner in which the decision was made.
* * * Judicial review is concerned, not with the decision, but with the decision-making process. Unless that restriction on the power of the court is observed, the court will in my view, under the guise of preventing the abuse of power, be itself guilty of usurping power."
In the same case Lord Hailsham commented on the purpose of the remedy by way of judicial review under RSC, Ord. 53 in the following terms:
"This remedy, vastly increased in extent, and rendered, over a long period in recent years, of infinitely more convenient access than that provided by the old prerogative writs and actions for a declaration, is intended to protect the individual against the abuse of power by a wide range of authorities, judicial, quasi- judicial, and, as would originally have been thought when I first practised at the Bar, administrative. It is not intended to take away from those authorities the powers and -discretions properly vested in them by law and to substitute the courts as the bodies making the decisions. It is intended to see that the relevant -27- authorities use their powers in a proper manner (p. 1160)."
In R. v. Panel on Take-overs and Mergers, ex p Datafin plc, Sir John Donaldson, M.R. commented:
"An application for judicial review is not an appeal."
In Lonrho plc v. Secretary of State for Trade and Industry, Lord Keith said:
"Judicial review is a protection and not a weapon."
It is thus different from an appeal. When hearing an appeal the Court is concerned with the merits of the decision under appeal. In Amin, Re, Lord Fraser observed that:
"Judicial review is concerned not with the merits of a decision but with the manner in which the decision was made.... Judicial review is entirely different from an ordinary appeal. It is made effective by the court quashing the administrative decision without substituting its own decision, and is to be contrasted with an appeal where the appellate tribunal substitutes its own decision on the merits for that of the administrative officer."
82. Bernard Schwartz in Administrative Law, 2nd Edn., p. 584 has this to say:
"If the scope of review is too broad, agencies are turned into little more than media for the transmission of cases to the courts. That would destroy the values of agencies created to secure the benefit of special knowledge acquired through continuous administration in complicated fields. At the same time, the scope of judicial inquiry must not be so restricted that it prevents full inquiry into the question of legality. If that question cannot be properly explored by the judge, the right to review becomes meaningless. 'It makes judicial review of administrative orders a hopeless formality for the litigant. ... It reduces the judicial process in such cases to a mere feint.' Two overriding considerations have combined to narrow the scope of review. The first is that of deference to the administrative expert. In Chief Justice Neely's words:
'I have very few illusions about my own limitations as a judge and from those limitations I generalise to the inherent limitations of all appellate courts reviewing rate cases. It must be remembered that this Court sees approximately 1262 cases a year with five judges. I am not an accountant, electrical engineer, financier, banker, stock broker, or systems management analyst. It is the height of folly to expect judges intelligently to review a 5000 page record addressing the intricacies of public utility operation.' -28- It is not the function of a judge to act as a superboard, or with the zeal of a pedantic schoolmaster substituting its judgment for that of the administrator.
The result is a theory of review that limits the extent to which the discretion of the expert may be scrutinised by the non-expert judge. The alternative is for the court to overrule the agency on technical matters where all the advantages of expertise lie with the agencies. If a court were to review fully the decision of a body such as state board of medical examiners 'it would find itself wandering amid the maze of therapeutics or boggling at the mysteries of the pharmacopoeia'. Such a situation as a state court expressed it many years ago 'is not a case of the blind leading the blind but of one who has always been deaf and blind insisting that he can see and hear better than one who has always had his eyesight and hearing and has always used them to the utmost advantage in ascertaining the truth in regard to the matter in question'.
The second consideration leading to narrow review is that of calendar pressure. In practical terms it may be the more important consideration. More than any theory of limited review it is the pressure of the judicial calendar combined with the elephantine bulk of the record in so many review proceedings which leads to perfunctory affirmance of the vast majority of agency decisions."
114. Mr B.R. Nair was not a decision-maker at all. He was one of the recommending authorities. As Director General of Communication as well as Telecom Authority his involvement in the approval and selection of tender was indispensable. He came to be appointed as Member (Services) on 29-5-1992. By virtue of the notification dated 28-7-1992 Mr B.R. Nair became the Director General of Telecommunication. As such, he could exercise all the powers under Section 3(6) of the Indian Telegraphs Act of 1885. Such a Telecom Authority has the right to grant cellular operating licences to the successful party and also reject any bids without assigning any reason. Registration fees, security deposit and other financial charges shall be fixed by the licensor in consultation with the Telecom Authority. This is what is stated in the financial bid. Therefore, Mr B.R. Nair could not dissociate himself from the decision-making process. It is under these circumstances the High Court rightly applied the doctrine of necessity. This Court in Charan Lal Sahu v. Union of India dealt with this doctrine which is stated as follows : (SCC p. 694, para 105) "The question whether there is scope for the Union of India being responsible or liable as -29- joint tort-feasor is a difficult and different question. But even assuming that it was possible that the Central Government might be liable in a case of this nature, the learned Attorney General was right in contending that it was only proper that the Central Government should be able and authorised to represent the victims. In such a situation, there will be no scope of the violation of the principles of natural justice. The doctrine of necessity would be applicable in a situation of this nature. The doctrine has been elaborated, in Halsbury's Laws of England, 4th Edn., p. 89, paragraph 73, where it was reiterated that even if all the members of the Tribunal competent to determine a matter were subject to disqualification, they might be authorised and obliged to hear that matter by virtue of the operation of the common law doctrine of necessity. An adjudicator who is subject to disqualification on the ground of bias or interest in the matter which he has to decide may in certain circumstances be required to adjudicate if there is no other person who is competent or authorised to be adjudicator or if a quorum cannot be formed without him or if no other competent tribunal can be constituted."
Therefore, we are unable to accept the contentions of Mr Soli J. Sorabjee and Mr Harish Salve.
152. We make it clear that we are not disturbing the other selections since the power of judicial review is not an appeal from the decision. We cannot substitute our decision since we do not have the necessary expertise to review.
154. In view of the foregoing, we thus reach the conclusion that Bharati Cellular could not claim the experience of Talkland. This conclusion has come to be arrived at on the basis of the parameters we have set out in relation to the scope of judicial review. We may reiterate that it is not our intention to substitute our opinion to that of the experts. Apart from the fact that the Court is hardly equipped to do so, it would not be desirable either. Where the selection or rejection is arbitrary, certainly this Court would interfere."
27. Mr. Narsimha, learned ASGI apart from citing the judgment which has been referred to above has placed reliance in the case of "THDC India Ltd. Vs. Voith Hydro GMBH Company & Anr" reported in (2011) 4 SCC 756 (supra), with respect to the fact that there was absolute fairness and transparency in the entire E-auction process and he has placed reliance on the following:
-30-29. "It has already been pointed out that it is only when all the exercise was taken in pursuance of this Court's judgment dated 26-3-2010 that Respondent 1 chose to raise the issue about the non-responsive bid of Alstom (Respondent 2). It went on with the whole exercise including the arguments before the panel of experts not once but twice and thereafter, also took part in the negotiations. But its stance changed only after the final decision was taken by the competent authority on 1-10-2010 and more particularly, after the Tender Committee had finalised the report on 14-12-2010.
30. In our opinion, since the whole process was absolutely transparent and since these issues, which were raised by way of a writ petition, were not even argued before the Court in the first round, there is no scope to stall the whole process by finding fault with the tendering process and insisting that THDC could not invite the fresh pricing bids. In our opinion, in inviting the fresh pricing bids, particularly after conveying the deficiencies or non-conformities to both the respondents and making it clear to them that they would have to comply with the same as at the first stage, we do not think that any change is being made in the bidding conditions."
28. Reference has also been made to the case of "Prestige Lights Ltd. Vs. State Bank of India" reported in (2007) 8 SCC 449 (supra), on the following paragraphs:
33. "It is thus clear that though the appellant Company had approached the High Court under Article 226 of the Constitution, it had not candidly stated all the facts to the Court. The High Court is exercising discretionary and extraordinary jurisdiction under Article 226 of the Constitution. Over and above, a court of law is also a court of equity. It is, therefore, of utmost necessity that when a party approaches a High Court, he must place all the facts before the Court without any reservation. If there is suppression of material facts on the part of the applicant or twisted facts have been placed before the Court, the writ court may refuse to entertain the petition and dismiss it without entering into merits of the matter.
35. It is well settled that a prerogative remedy is not a matter of course. In exercising extraordinary power, therefore, a writ court will indeed bear in mind the conduct of the party who is invoking such jurisdiction. If the applicant does not disclose full facts or suppresses relevant materials or is otherwise guilty of misleading the court, the court may dismiss the action without adjudicating the matter. The rule has been evolved in larger public interest to deter unscrupulous litigants from abusing the process of court by deceiving it. The very basis of the writ jurisdiction rests in disclosure of true, -31- complete and correct facts. If the material facts are not candidly stated or are suppressed or are distorted, the very functioning of the writ courts would become impossible."
29. The issue raised by the learned ASGI with respect to suppression made by the petitioner has been relied upon in another judgment in the case of "K. D. Sharma Vs. Steel Authority of India Ltd. & others" reported in (2008) 12 SCC 481 (supra) on the following paragraphs:
38. "The above principles have been accepted in our legal system also. As per settled law, the party who invokes the extraordinary jurisdiction of this Court under Article 32 or of a High Court under Article 226 of the Constitution is supposed to be truthful, frank and open.
He must disclose all material facts without any reservation even if they are against him. He cannot be allowed to play "hide and seek" or to "pick and choose"
the facts he likes to disclose and to suppress (keep back) or not to disclose (conceal) other facts. The very basis of the writ jurisdiction rests in disclosure of true and complete (correct) facts. If material facts are suppressed or distorted, the very functioning of writ courts and exercise would become impossible. The petitioner must disclose all the facts having a bearing on the relief sought without any qualification. This is because "the court knows law but not facts".
39. If the primary object as highlighted in Kensington Income Tax Commrs. is kept in mind, an applicant who does not come with candid facts and "clean breast"
cannot hold a writ of the court with "soiled hands".
Suppression or concealment of material facts is not an advocacy. It is a jugglery, manipulation, manoeuvring or misrepresentation, which has no place in equitable and prerogative jurisdiction. If the applicant does not disclose all the material facts fairly and truly but states them in a distorted manner and misleads the court, the court has inherent power in order to protect itself and to prevent an abuse of its process to discharge the rule nisi and refuse to proceed further with the examination of the case on merits. If the court does not reject the petition on that ground, the court would be failing in its duty. In fact, such an applicant requires to be dealt with for contempt of court for abusing the process of the court."
30. In "Rajasthan Housing Board & Anr. Vs. G. S. Investments & Anr." reported in (2007) 1 SCC 477 (supra), the question of public interest in a covered transaction was under consideration and it was held as follows:
-32-11. "The sale of plots by the Rajasthan Housing Board by means of an auction is essentially a commercial transaction. Even if some defect was found in the ultimate decision resulting in cancellation of the auction, the Court should exercise its discretionary power under Article 226 of the Constitution with great care and caution and should exercise it only in furtherance of public interest. The Court should always keep the larger public interest in mind in order to decide whether it should interfere with the decision of the authority. In the present case, there was enough material before the State Government to show that in the past plots in the area had fetched a price of Rs 10,000 per square metre and the highest bid made by the respondent in the present case was nearly half i.e. Rs 5750 per square metre, which clearly indicated that the auction had not been conducted in a fair manner. If in such a case the State Government took a decision to disapprove the auction held and issued a direction for holding of a fresh auction, obviously the said decision was taken in larger public interest. In these circumstances there was absolutely no occasion for the High Court to entertain the writ petition and issue any direction in favour of the contesting respondent. The orders passed by the learned Single Judge on 4-8-2004 and the order passed by the Division Bench of the High Court on 23-9-2004 are clearly erroneous in law and are liable to be set aside."
31. Similar was the views expressed in the case of "Jagdish Mandal Vs. State of Orissa & others" reported in (2007) 14 SCC 517 (supra), and the relevant paragraphs for the purposes of this case are quoted hereinunder:
19. "In the second case, it was contended that the High Court had wrongly allowed the writ petition, without even referring to the facts or considering the contentions. It was submitted that the High Court ought to have considered the separate reasons given by the Committee for rejection of the tender of the fifth respondent, that is, quoting of unduly low rate for Item 19 and quoting a manipulated rate for Item 4.
20. The learned counsel for Respondents 1 to 4 broadly agreed with the contentions urged by the appellants. The fifth respondent, however, supported the reasoning of the High Court. On the contentions urged, the question that arises for consideration is whether the High Court in exercise of power of judicial review, was justified in quashing the award of the contract relating to first stretch to Jagdish Mandal and award of contract relating to second stretch to Laxman Sharma and directing reconsideration of tender."-33-
32. In the case of "Michigan Rubber (India) Ltd. Vs. State of Karnataka & Anr." reported in (2012) 8 SCC 216 (supra), it was held as follows:
35. "As observed earlier, the Court would not normally interfere with the policy decision and in matters challenging the award of contract by the State or public authorities. In view of the above, the appellant has failed to establish that the same was contrary to public interest and beyond the pale of discrimination or unreasonable. We are satisfied that to have the best of the equipment for the vehicles, which ply on road carrying passengers, the 2nd respondent thought it fit that the criteria for applying for tender for procuring tyres should be at a high standard and thought it fit that only those manufacturers who satisfy the eligibility criteria should be permitted to participate in the tender.
As noted in various decisions, the Government and their undertakings must have a free hand in setting terms of the tender and only if it is arbitrary, discriminatory, mala fide 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 the tender would have been fair, wiser or logical. In the case on hand, we have already noted that taking into account various aspects including the safety of the passengers and public interest, CMG consisting of experienced persons, revised the tender conditions. We are satisfied that the said Committee had discussed the subject in detail and for specifying these two conditions regarding pre-qualification criteria and the evaluation criteria. On perusal of all the materials, we are satisfied that the impugned conditions do not, in any way, could be classified as arbitrary, discriminatory or mala fide."
33. In the case of "Arunoday Magaswargiya Mazdoor Kamgar Sahakari Sanstha, Ltd., Walni Vs. State of Maharashtra and Others" reported in 2013(2) Mh.L.J. (supra), a Division Bench of the Bombay High Court had held that no protest was ever lodged by the writ petitioner during the entire process and having failed, in such process he cannot have a grudge. This view was affirmed by the Hon'ble Supreme Court in Special Leave to Appeal (Civil) No. 9941 of 2013.
34. On a consideration of the factual aspects juxtaposed with the judicial pronouncements advanced on behalf of all the sides, it clearly reveals that the petitioner did not raise any grievance or any objection at the time of resumption of the auction process and he duly -34- participated in the same having submitted 12 bids including 8 bids which were submitted by the petitioner during the extended period. The petitioner was precluded from challenging the entire process after being unsuccessful in the bidding process. Although the petitioner had relied on the case of "Nar Singh Pal Vs. Union of India & others"
(supra), but the fact of the said case under reference was with respect to the litigant being a casual labour having encashed the retrenchment compensation and then subsequently challenged the order of retrenchment. The case of the petitioner is on an altogether different level, moreso when the commercial bidding process was under way.
The entire tender process have been held in a fair and transparent manner and the respondent - BCCL had given a level playing field to all the participants. The resumption of the tender process was not contrary to the terms and conditions of the NIT and as has been held above, there was indeed a system failure which affected the respondent no. 8 as well as some other bidders and on being corrected further participation in the extended bidding process took place which also included the petitioner. The bid offer of the petitioner is much higher than what has been offered by the respondent no. 8. The Court has to weigh the pros and cons and will not exercise the powers of judicial review if the decision making process is in consonance with the terms and conditions of the contract. The public interest is writ large considering the bid offer made by the petitioner which is much higher than that of the respondent no. 8 and no aberration or any fault could be pointed out which would need interference by this Court in the decision making process itself. The powers of a judicial review is to remove arbitrariness, unreasonableness, unfairness and irrationality. The act of the M/s. BCCL or for that matter C1 India Pvt. Ltd cannot be termed to be an unreasonable exercise on their part which would further be substantiated by the fact that never did the petitioner raise any objection with respect to the resumption of the auction process or participating in the auction process. It is thus held that the respondent - BCCL had acted in a fair and reasonable manner in conducting the entire tender process and this Court is not inclined to exercise its powers of judicial review as the entire process itself has been found to be transparent and in adherence to the terms and conditions of the NIT. Coming back to the last leg of the argument with -35- respect to acceptance of the performance guarantee, even after the expiry of 28 days from the date of receipt of the letter of acceptance, it appears that the prior to the expiry of the period of 28 days, the respondent no. 8 had made a representation before the competent authority and thereafter had submitted the performance guarantee which was accepted by the respondent - BCCL as the CMD had condoned the delay by invoking Clause 4.3 of the terms and conditions of the contract. Clause 4.3 clearly gives discretion to the CMD, BCCL to permit the successful agency to submit performance security upto an extended period and therefore, on such score also, the petitioner has failed to make out a case of non-adherence to the terms and conditions of the NIT.
35. As a consequence to what has been discussed above, this writ application fails and the same is accordingly, dismissed.
(Rongon Mukhopadhyay, J) Jharkhand High Court at Ranchi The 16th day of August, 2017 R.Shekhar/NAFR/Cp 2