Karnataka High Court
M/S Sanjay Marketing And Publicity ... vs State Of Karnataka on 17 April, 2012
Bench: D.V.Shylendra Kumar, K.Govindarajulu
1
IN THE HIGH COURT OF KARNATAKA
AT BANGALORE
Dated this the 7h day of April, 2012
PRESL\ F
THE HONBLE MR JUSTICE D V SHYLENDRA KUMAR
AND
THE HON'BLE MR JUSTICE K GOVINDARAJULU
WniAjpcu1 Vos, 28G287f 201 JpMTjJ
BETWEEN:
M/S SANJAY MARKETING & PUBLICITY SERVICES
REPRESENTED BY I PS PROPRIETOR
MR R NAGARAJ NO 131.
15TH MAIN 35TH CROSS.
F BLOCK, JA'ANAGAR,
I3AGALORE 560 0 \PPELLANT
[By Sn Javakurnar S I aLl Sr Ad for
Sri M Rudraiali & Sri Ajav Ktiina N. Advs.l
AND:
iaiE OF iL\N\-\[AI\A
RET, BY HL: PRJN. IPAL SEC R iA
Pf BLI( WORKS DUPAF IMI N
\ IKASA SO Di-L\
JilL C LII' I EN( INF ER K
Di3I1( \ORKS POPI' LV\L
\ 'J LU I RAN SW JRI L)f I AI' I VII N
[F\J ) IL L( NI A
\ fJ )\ J)!iiii-
2
FIlE EXE(YTIVE ENGINEER NO.1
131 1LDINGS DIVISION,
PUBLIC WORKS. PORTS TM V\
i)
1
WATER TRA\SPOR1 T)EPAR [AIEN I
K.R CIRCI F
IA\c;AL )RE 6() (JO I
5. \SIAN LAB IECH LID..
1
M
PLOT NO. iT 11 i>IIASE.
PEENYA INDI 1
STRIAL AREA
BANGALORE 560 058 RESPO\DFZ\ IS
[BY Sri B Veerappa. AGA for Ri R3.
Sri Chandrasliekhar & Sri M L Gowda, Advs. for R4J
CHESE APPEALS ARE PILED UNDER SECTION 4 OF TIlE
KARNAFAKA hiGh COURT ACT. PRAYING TO SET ASIDE IIIE
ORDER PASSED IN TI-IF WRIF PETITION NOS46088 89/2011
(GM
TEN) DATED 27/12/2011 AND ETC..
THESE APPEALS COMING (IN FOR PRELIMINARY HEARING
I'IIIS DAY SHYLENDRA KUMAR J, DELIVERED THE FOLLOWIN
G'
JUDGMENT
1 hese appeals. which had corn up for prelinunar Iiearnig along witH inIer1oiitor ppIl itions ttr clot.
otic
I N rr1 a writ .titiiis h.' III,/
3
challenging the said order of the learned Single Judge. the prc.scnt appeals.
3. The appellant was an aspu ant for getting the contract foi supply of furniture to 14/15 quarter% ol the govenunent constructed for judges of High Court of Karnataka. for their residential purpose. The appellant was responding to an electronic tender InvItation format notified on 7 7-2011 by the third respondent executive engineer for supph /exeeution ol the following works amongst many other similar twins:
1) Providing and Jalng wardrobe 26500 sq flL
- of minimum depth qf 0.60 m -
21 ProvIding and fIxation wooden 453.00 sq iii. book Rack 31 ProvIding Teak wood I)ouble 45.00 Nos. wls • 41 Providing teak wood Tea pos 245.0() Xc,s. 3 Providing Teak rood ?/?/ 1' T36 00 'c' tar scaLErsqfasc s --
61 Provldir'q rcak IL'flod LJuarig 12 Cli) No%. libk • 71 Providing Foik u'orxl f)inimi löftOO Nit,,.
rhafrs I 4
4. The tender document' also indicated eligibility criteria. xistenc e of wIth ft alone enabled a tenderer to
l)tLs% the technical bid. which could enable opening of his/her financial bid. 11w salIent aspects of the eligibility criteria as per the tender document'.. are as under:
3. Qualfflcatinn of the Tenderer:
3.2 To qualify for award of this contract each Tenderer In his name should have in the lastjlve years period.
(a) achieved In at least two Jinanclal years an average annual financial turnover of Rs (usually not less than two times the estimated annual payment under this contract. (hi Should han. satisfactory completed as aprime contractor Jor at least one surular work to an extent oj 8O' 01 the cost ot rhc woik. icr aLl works ostuiq IIIO1E than Rs 100 Lakh Ic) ewczziecL in wtu one qc'w 'jar U onlzn isrcr,xL )rn Ii it tallc'u'ing 'iijnlri ituli 'gLuuLUiies '!i on' 9 . . 9...
1.t'1 5
3.:.3 Equipment (cipczcily:
Ecicli Lenclerer siioul.ct Ii in her demonstrate availability of [blowing key and critical equipment:
pçlsI Total
Ownershi
Number Lease
1
(ctl Availability by owning cit least :50% of the required / specified key and critical ecjuipmenl [br this work with relevant ownership documents.
{b) the remaining 50% can be deployed
on lease / hire basis jbr all works
provided, the relevant documents
com.mnitmenI agreement etc.] for
availability for this work are
furnished.
(e) Liquid assets and or availabilittj of
credit facilities oj not less than Rs, (Credit ines / Letters of Credit / CertLficates from Bunks) for meeting the ftmcl requirement etc, 36 Teiderers who meet the above spec(fleci 1 fl UtUfl tO 11f1JO(3 iL b quaifled, (f their available tender capacity is more than the total tender caIne. The cwctilable tender capacity a .jJ( be ccdcul.eci as under:6
Assessed available tender capacity = (A x Nxl.5-B) where A = Maximum value qf civil engineering works executed in any one year during the last JIve years (updated to Current Financial Year price level) (Fl' in which tenders are Invited) taking Into account the completed as well as works in progress.
N= Number of years prescribed for
completion of the works for which
Tenders are invited.
B= Value, at Current FinancIal Year (Fl'
In which tenders are invited) price level, of existing commitments and on-going works to be completed during the next . Years (period of completion of the works for which Tenders are Invited) Note:The statements showing the value of existing commitments and on-going works as well as the stipulated period of completion remaining for each of the works listed should be counterslgned by the Employer In charge. not below the rank of an Executive Engineer or equivalent
5. The offers of the bidders were examined for technical fulfilment and such examination took place on 16-9- 7
2011. It is the version of the respondents that there were only three applicants Including the appellant and the fourth respondent. but other applicants having been found to have furnished wrong or Insufficient documents, were not considered for the technical bid.
6. According to the respondent-authorities, while the fourth respondent passed the technical bid. appellant failed and therefore the contract was entrusted to the fourth respondent as per the decision dated 19-9-2011. However, as the appellant's application was eliminated by the technical evaluation committee as per the resolution dated 19-9-2011. appellant had Initially approached this court by filing WP No 38423-24 of 2011, questioning this evaluation by the committee. These writ petitions came to be dismissed, with this court noticing that the appellant had alternative remedy by way of a statutory appeal under Section 16 of the Karnataka Transparency In Public Procurements Act. 1999 [for short, the ActJ. 8
7. The appellant tiled an appeal before the government and the said appeal ame to be dismissed as per order dated 1 12 2011 [copy at Annexurt 0 to the writ petitionj.
8. Challenging the evaluation of the committee and the affirming order by the appellate authority, the appellant approached this court by filing P Nos 46088 89 of 2011 Writ petitions having been dismissed by a learned Single Judge of this court, the present appeals against this order for setting aside the same and also for setting aside the orders of the appellate authority as well as the technical evaluation committee 9 Noties had hcn issued to the rcspondnts in thcse ipp us Respondents are sen ed and rc spond nt 1 to 3 arc epn € nt€ d Sn I eerappa roe I AC A i I e h p id n c- ' i I b ii C r incir k il/I CoudaAd 1 9
10. Counter has been filed on behalf of the respondents I IL) 3. lii the absence of a.n statement hi the wilt petitions, as the writ petitions had been dismissed (IL limine and so also b3 the fourth respondent.
11. We have heard Sri Jayakumar S Path, learned senior counsel appearing tbr the appellant. Sri B Veerappa. learned AQA for respondents 1 to 3 and Sri ('handrashekar. learned counsel for fourth respondent. 12 Examination by this court is only because of the provisionca of the Act and the statutory provisions therein. parneularlv the maiidaton provisions oh Section 5 of the c t. readmg as under
5. Procurement other than by tender prohibited On - and from the cicue qI uinmencvrilent (4 thL% Act rio Ptocurenrnr .1 thy ta'1ro un pod icc i c's ept a twig craft' ugpk
11. W'liik tin w n- at 'ci-- of the appellant F. perhap'.
C 1 C t
''ii Iie t,4
iii 1 1: u:'I ' h i.,.
I:," n .rlo.i, I t)a41z d
10
the contracL But flue uroLInds i 1r&e(1 on behalf of the
appellant ar( ihat the rcspondt fits aullioiitics ha e not tdhered to the norms e en as per the lendex document, thai they have not applied 1 inilornt siandards in evaluating the bid of the appellant vis a-vis fourth respondent and theretore there is not only violation of Section 5 of the Act but also Rule 21 of the Karnataka Fransparency in Public Procurements Rules, 2000 [for short. the Rulesi. reading as under:
21, Tender evaluation to be in accordance with evaluation criteria The Tender Accepting Authority shall cause the evaluation ol tenders to be carried out stricthj in accordance u'itli the CVUhtLQLiOTl crueraa Lad icated (ii th tender docwnei tts dud bccaus ot flue (llscuuunhrlatory and irriiuary iuiannci of cx aluanon of tIle i cndei docuimenr. eX en tin a tlOfl Ofl I p rt of I a e iol I I I I t rHti lion I lath H aid Is to hay ante 3nç cl '(I a a I poir d c 1 11 with reference to the eligibility criteria that the requirement of clauses 3.2(a), (b) and (c) are to be fulfilled by any bidder: that the manner of fulfillment required under each of these clauses Is different and independent and as It was found that while the appellant did not fuiffi such requirements, particularly, as the appellant did not fuffil the requirement under clauses 3.2(b) and (c) of the tender document, the appellant did not get through the technical evaluation, whereas the evaluation committee found that the fourth respondent did pass through this test and survived for the stage of opening of the financial bid.
15. While Sri Jayakumar S Path, learned senior counsel appearing for the appellant does not dispute much that the appellant may not qualify for fulfilling the eligibility criteria I.e. fulfillment of requirement of clauses 3.2 (a), (b) and (c) of the tender document within five financIal years from 2006-07 to 2010-11, the respondents I to 3 having not acted in a fair manner by applying the same norms, 12 but deviating from the prescribed norms as per the tender documents and have shown a marked favouritism in favour of the fourth respondent. even In violation of Rule 21 of the Rules and In turn giving a go-by to the requirement of Section 5 of the Act. What Is pointed out In particular Is that for maldng good the qualification as per clause 3.2 (c) of the tender document I.e. execution of the requisite quantity of works within a continuos period of 12 months, the evaluating committee has reckoned the work executed by the fourth respondent for the continuous period of 12 months starting from February, 2006 and ending with January, 2007 and therefore reckoning the period between February and March 2006 and the work executed during this period for the purpose of evaluating the eligibifity criteria of the fourth respondent is virtually giving a go-by to the tender conditions: that certain works executed by the fourth respondent for the period which was not a qualiIiing period as per the tender documents has been taken Into 4 fr 13 consideration to enable the fourth respondent as a person who can survive th technic al e aluat ion and therefore the enthe proceedings in ihated 16 It is also submith d that if the sime norm I e taking the calendar vc ar starting from January 2006 should have been applied even to the appellant the appellant, perhaps, c ould have qualified, but that has not bec n resorted to by the respondent authorities and th respondents while have consciously evaluated the earlier performance of the appellant strictly for the five yeai s pci iod from 1 April 2006 to 31 March 2011 in the as of fourth respondent h ii ing cvalu ited thc peifoim inc c of thc fourth rcspondnt for h period tvio north prior 4 2006 is it cd he pr e n, d I I 2 4 14 requirement of work having been executed within a particular financial year. but It could be a continuous period of 12 calendar months in a year or any continuous period of 12 months In the five years qualififlng period and therefore reckoning the performance of fourth respondent for the continuous period of February 2006 to January.
2007 Is well within the scope of clause 3.2(c) and therefore the evaluating committee has not deviated from the norms stipulated as per the tender documents.
18. JudIcial review of administrative action Is the manner of decision making process and If has been proper, law-conforming, statute-conforming and has been carried out In a fair and non-arbitrary manner. An action/decision which is non-conforming with the statutory requirement or even a non-adherence to the tender conditions which are published, automatically attracts the vIe of provisions of Rule 21 of the Rules and Section 5 of the Act.
4 15
19. Five years' duration as notified. during which five years, the performance of any tenderer will be examined and about his ability to have executed the work within the period in terms of clauses 3.2(a), (b) and (c) of the tender document is the proper norm for evaluation.
20. Five years even as per the tender documents and as per the counter, are five years from 2006-07 to 2010-il. Though Sri Veerappa has very strenuously contended that the period to begin with for reckoning the five years can be from first January 2006 onwards and therefore evaluation of the capacity of the fourth respondent starting from February, 2006 Is not In violation, we are not at all convinced of this argument, as we find that splitting 12 months Into two years I.e. 2006-07 can only mean that It is financIal year of 2006-07. Financial year begins on the first April of each year and ends on 3 iM March of the following year. Calendar year begins and ends In the same year and will not telescope into next year. 16
21. While for ihe fulfillment of the criteria in terms of clauses 3.2 (c) of the tender document. execution of the work by a bidder for any consecutive 12 calendar months during the five years period starting from first April 2006 and endin& on 3 1 March. 2011 can be reckoned. it cannot either io for any months or days or years prior to the beginning of the financial year 2006 i.e. prior to 1--4- 2006 nor can go beyond the financial year 2010-11 i.e. beyond 31st March 2011.
22. The very case of the respondents to justify the decision of the evaluating committee is that while no doubt the perlormance of the fturth respondent lot the two months of February and March 2006 is also included for the 1,2 mont.hs period for reckoni.ng the fulfillment of clauses 3.2 (c) of th.e tender doe'ument, there is nothing wronti in this method, as financial year is referred to in eIause-32cL
23. While it is true t.hat .finaneial year '.i not referred to in clause 3,2(c) and it ca.n he a contIguous pe.rlod of 12 a v.
'4 17months In one calendar year or in two calendar years, partly In one year and other part In other year, it can ever go beyond 1-4-2006, but unfortunately for the fourth respondent, the technical evaluation committee has gone two months behInd 1-4-2006, which means the committee has taken into consideration the performance of fourth respondent for a two months' period, which did not qualiIr for reckoning the performance of a bidder as per the tender documents.
24. Such method of evaluation is clearly In violation of Rule 21 of the Rules and In turn is a deviation from the mandatory requirement that the contract be awarded only by Inviting tenders.
25. Sri Chandrashekat, learned counéel for fourth respondent, on his part has submitted that the fourth respondent has placed its performance level and it is for the technical evaluation committee and if the committee has found the performance levels of fourth respondent as 4--
18one qualiing the requirement there is nothing further for the fourth respondent to contribute and points out that work has already been executed up to 50°o of th total work entrusted and therefore no need for interference at this stage.
26. While from the records, we find that the estimated value of the work was 5, l3O3OOO/ hut what was quoted by the fourth respondent for executing the work is 633OOOOO/, It is also submitted on behalf of the respondents that as the appellant did not get through the technical evaluation and therefore did not qualilr, there was no occasion for opening the financial bid of appellant and therefor it is of no consequence I With thc fourth respondent being the lone candidate left ir he field hc respondcnt In 3 ir justified in r Ii i& nu i t ii our ml rc p naen ir ci r for c r V app i k a rn d AC A pr not di Ii ft it I ii liT 19 28 While practical difficulties may be pleaded. equities rna be invoked and such other aspe( ts niay also be hroulit to the notice of the court, such as disruption at this stag( will COfli( in the w'iy of satisfactory completion of the work dc,, but fori uriatelv or unfortunately when court examines a matter in the exercise of constitutional jurisdiction of judicial review of administrative a tion, the parameters can only be statutory provisions and constitutional provisions 29 In the present case, the technical evaluation eommltt(( whik perhaps could not ha'e approved the applu alion f the appellant as it found the appellant did not ilfil th cIigibiht ritt ii xithi i In tipuIatd I ne ar per od r1 rut m f tI fats plac d In ft r ur nd I as pe th id )l c Inhic t t urth p nd r I ft I t I hi Ii In it i it I I c h n I It ti it 20 respondent did fulfil the eligibility criteria, it is not only ghJng a go b to tlR notifit d tendei ( onditions but also results in violation of Rule 2 1 of the Rules and de iating from the mandatory iquiremerit of Stion of the At. 30 Accepting the submissions on behalf of the respondents will be nothing but giving a go by to the provisions of the Act, If such submissions are ac(epted, the x cry purpos and object of legislatun having made such a law will be defeated More importantly. it also attracts Article 14 of the Constitution of India. as it I', time mandah to the state that th state accords equal opportunity to rll intending partnipants Whn one the terid i clo uniein' irid ft ndt r (oridiLioris am c notified ui.
ligil mlit rite i rn nia kim ri t Iii lii I ii
id F I ix ft r F hgit flit ii r It r
Ic I F
qu jil uit i ( a F iiti. iiduii.
oi i. i r I
21
will be a clear instance of arbitrary exercise of power in violation of statutory r quireme nt 31 While it is not on record as to what was the financial hid offered by the appellant and even the respondent authorities are unable to place the figure, as it is stated that the system has been so programmed by the e governance that when once a technical evaluation committee rejects a bid, It does not allow opening of the financial hid itself, Sri Jayakumar S Patil, learned senior counsel appearing for the appellant has submitted that the appellant had made a bid for 4q23 crore This is not borne out on record nor in the objection pleading or writ appeal grounds et 3? It is h refor we rc inabk to opirn orn i a or thc other rn thi ispeet I it it is lefinift hat pp rtt nit i 1 ,t )1dder, e Fo ,i1i p- t IllaLk i mpttn fkr ai I p i .d pp t nt rpet h Ift ' I ri 22 is much ihovc even the standard value of work s per the flOl Ills d(lu{)ttd i)\ Ilir rrspoiidciii s I to 3.
33. fIns is a situation where Article 1 1- of the Constitution of India is clearly ittrcted nd this court functioi tirig as constitutional court cannot overlook constitutional violation committed by the executie part of the stale atid in the instant case not rnerel the action of the stale is violative of Article 14 of the Constiltition of India but even the very statutory provisions are violated and respoiideiits 1 to 3 having not adhered and followed their own tender conditions. It is therefore, that the action of the t hnical evali iai ion committee aro ing the candid iture of I ourtn respondent cannon be susnaineu i den dated 19 2 2011 passed by hc C mrni Icc a di as h rder 2 1 c 12 2011 p the ppc hIt IlitijulIte it t1 iiaslit'd the aid (a Ott i rd Sjiit t(iLt i ci'IU atd I hd WI a Tii iri' €ue jI!'\i 1 Oc i-i( (J in I tua h- cli \ic'x 'n I) 23 and G to the writ petitions are quashed by Lssue of writ of c citloxari.
3 1. That still leave us with the request of lmirth respondent to lwnnht it to complete the ececutlon of the contract in the larger interest of the development work being completed etc.
35. A submission of this nature cannot be entertained. The moment this court find stal utory violations and when by operation of laM the state action is quashed by Issue of a proper writ, that cannot he avoided by any oilier backdoor met hod or on ronsiderarioji of rquity or on practical aspeetc of the mat itt.
3€ It Is. thuetore, that the '4at gocr uncut I directed
rcno ly the e t ii f flit wit d r fat as iii
p j Ii he 1- j Ic
LI LL1 1 'lb I. • v 1 tabllltv ut It In ft
C ) .ki'it is to' tunE thi u cort' itt i
t.' .. un .,
y,eq , ..l.ttiti.itl(_ '!' f ti-h _lh1ritlt ..I
24
cannot be allowed to execute the work. but we leave It to the Mate to evahiate the work eNectiteci hitherto at any rat c' belrn t he 't andard rate a ad keeping in mind the possible oilers that the Mate will receive br similar work which is to be renotifled and to (ompensate the fourt h respondent only to this extent and not beyond.
37. In view of disposal of the appeals, applications in IA 1/20 12 and IA 11/2012 do not sun'ive for considera tion and they are accordingly rejected.
Sd RIDGE TUDC.1 'piP