Rajasthan High Court - Jodhpur
M/S Parihar Builder vs Jodhpur Development Authority ... on 22 November, 2024
Author: Nupur Bhati
Bench: Nupur Bhati
[2024:RJ-JD:47629]
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
S.B. Civil Writ Petition No. 18724/2024
M/s Parihar Builder, Mahamandir Circle, Mandore Road, Jodhpur
Through Its Proprietor Ravindra Singh Parihar S/o Madho Singh
Parihar, Aged 48 Years, R/o Bhagat Singh Marg, Mahamandir
Choraha, Jodhpur (Raj.).
----Petitioner
Versus
1. Jodhpur Development Authority, Jodhpur Through Its
Secretary, Infront Of Railway Hospital, Ratanada, Jodhpur.
2. Executive Engineer (West), Jodhpur Development
Authority, Jodhpur.
----Respondents
For Petitioner(s) : Mr. Dinesh Jain along with Mr.
Bhawesh Kumar Kumawat
For Respondent(s) : Mr. Rajat Dave
HON'BLE DR. JUSTICE NUPUR BHATI
Order 22/11/2024
1. Though the matter was listed in the 'Fresh' category, upon the joint request of both the parties, the matter is heard finally, today itself.
2. The instant writ petition has been filed by the petitioner under Article 226 of the Constitution of India challengeing the criteria for qualification with respect to the technical bid, issued by the respondent no. 1 in Notice Inviting Tender ('NIT') dated 30.10.2024 (Annex.2), stipulating that it is required for the contractor to have his own RMC/Bitumen Plant, if the estimated cost of the work is more than 50 lakhs.
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3. The writ petition has been preferred with the following prayers:
"It is, therefore, respectfully prayed that record of the case may be called for an by an appropriate writ, order or direction:
(i) The impugned criteria for qualification (Technical Bid) issued by respondent in NIT (Annex.2) to the extent of the arbitrary condition put by the respondent JDA to the effect that if the estimate cost of the work is more than 50 lacs for construction of Tarr/CC road, then the contractor should have his own RMC plant/ Bitumen Plant and he has to submit the document with regard to ownership of such plant, may kindly be quashed and set aside and the petitioner may be allowed to participate in the Bidding process in pursuance of NIT No. 06/2024-25 (Annex.2).
(ii) That if technical bid of the petitioner is found to be lowest, then the petitioner firm may be awarded the work contract.
(iii) Any other relief to which the petitioner is entitled, may be granted in his favour.
(iv) The writ petition may be allowed with costs."
4. Briefly stated, the facts of the case are that the respodent no. 1, Jodhpur Development Authority ('JDA') issued an NIT on 30.10.2024 (Annex.2) for calling upon bids for works relating to construction of road including construction of CC road at Tilwadiya Fanta and the estimated cost of work was Rs. 139.60 lakhs. The last date for filing the online application form and deposit of earnest money was fixed as 14.11.2024 and the date of opening of the bids was fixed at 15.11.2024.
5. Clause 20 of the NIT dated 30.10.2024 provides for a condition that if the estimate cost of work is more than 50 lakhs, then the contractor should have his own RMC/Bitumen plant and he has to submit the document with regard to the ownership of such plant in order to be eligible for submitting his tender. Thus, (Downloaded on 27/11/2024 at 09:46:41 PM) [2024:RJ-JD:47629] (3 of 15) [CW-18724/2024] aggrieved of the clause 20 of the NIT (Annex.2), the petitioner has preferred this writ petition.
6. Learned counsel for the petitioner submits that the action of the respondent no. 1 by putting the condition in Clause 20 of the NIT (Annex.2) is arbitrary and contrary to the very spirit of the fundamental principles enshrined under Section 4 of the Rajasthan Transparency in Public Procurement Act, 2012 ('RTPP'), which provides that it shall be the responsibility and accountability of the Procuring Entity to provide fair and equitable treatment to the bidders, promote competition and put in mechanics to prevent corrupt practices. However, he submits that, by way of imposing this condition, the Procuring Entity has deprived many prospective bidders from participating in the bidding process like the petitioner, just because they are not having ownership of the RMC/ Bitumen plant and thereby, drastically reducing the competition and favouring blue-eyed bidders.
7. Learned counsel for the petitioner also submits that according to the work order dated 27.06.2024 (Annex.3), issued by the Department of Finance, Government of Rajasthan, which provides that the class of contractor who are qualified to tender the amount, an AA Class contractor is qualified to tender any work upto any maximum amount and as per normal procedure of the bid, this type of condition was never imposed by the respondent no.1 or any other department in previous tenders.
8. Learned counsel for the petitioner also submits that the respondent no. 1 had issued another NIT dated 15.10.2024 (Annex.5) for undertaking construction of CC road at Ward No. 14, 16, Pratap Nagar, Jodhpur and in the clause 13 of the said NIT (Downloaded on 27/11/2024 at 09:46:41 PM) [2024:RJ-JD:47629] (4 of 15) [CW-18724/2024] (Annex.5), the respondent no. 1 had put the condition of submitting the documents with regard to ownership of his own RMC plant, however the said condition was revoked, vide corrigendum issued on 22.10.2024 (Annex.6). He thus submits the imposition such condition in the present case is discriminatory and the respondents are trying to give undue advantage to blue- eyed persons with malafide intention and therefore, clause 20 of the NIT dated 30.10.2024 (Annex.2), needs to be struck down.
9. Learned counsel for the petitioner also submits that only four entities have their own RMC/Bitumen Plant (however the same is not mentioned anywhere in the writ petition), and if the clause 20 of the NIT dated 30.10.2024 (Annex.2), is not struck down, it would create barriers for other prospective participants in the bid and therefore, clause 20 is violative of Section 6 of the RTPP Act, which provides that the Procuring Entity shall not establish any requirement aimed at limiting the participation of bidders in the procurement process that discriminates against or among bidders or against any category thereof, except when authorised to do so by the Act.
10. Learned counsel for the petitioner also places reliance upon the judgment rendered by the Hon'ble Apex Court in the case of M/s N.G. Projects Ltd. v. M/s Vinod Kumar Jain & Ors. [Civil Appeal No. 1846 of 2022 decided on 21.03.2022] wherein the Hon'ble Apex Court has observed that the Court can exercise the power of judicial review to find out whether the decision of the State was manifestly arbitrary or unjust.
11. Learned counsel for the petitioner also submits that the clause no. 20 is bad in law and that, the respondent no.1 ought to (Downloaded on 27/11/2024 at 09:46:41 PM) [2024:RJ-JD:47629] (5 of 15) [CW-18724/2024] have given relaxation of leasing out the RMC/Bitumen Plant and thus, allow the petitioner to participate in the NIT dated 30.10.2024 (Annex.2).
12. Per contra, learned counsel for the respondent no. 1, while relying upon the judgment passed by the Hon'ble Apex Court in the case of N.G. Projects (supra) submits that the scope of judicial review is limited in case of such contracts and that, it is not for the Court to determine whether a particular policy or decision taken in the fulfilment of that policy is fair, the Court is only concerned with the manner in which those decisions are taken and thus, the administrative action is subject to the control of judicial review only upon the grounds of Illegality, irrationality, and Procedural Impropriety, which is clearly not the case here and therefore, the present case warrants no interference by this Court.
13. Learned counsel for the respondent no. 1 also draws attention of this Court towards the fact that although the counsel for the petitioner pleads for grant of relaxation of leasing out the RMC/Bitumen Plant, however, the said plea has been nowhere mentioned in the writ Petition and nor in any representation, and now is raising an entirely new ground.
14. Learned counsel for the respondent no. 1, by way of attaching photographs of both the locations, i.e. CC Road construction at Tiwadiya Fanta and Ward No. 14, 16 at Pratap Nagar, Jodhpur, for the purpose of which the NIT dated 30.10.2024 (Annex.2) and the NIT dated 15.10.2024 (Annex.6) and, had been issued respectively, draws a distinction on the basis of the width of the road and submits that Ward No. 14, 16 from Bhawani Dairy to the House of Sajjan Singh falling in the area of (Downloaded on 27/11/2024 at 09:46:41 PM) [2024:RJ-JD:47629] (6 of 15) [CW-18724/2024] Pratap Nagar, Municipal Corporation (North), Jodhpur, consists of a narrow lane where the operation of RMC Plant for construction of CC road is practically not possible and therefore, the condition of ownership of the RMC/Bitumen Plant was revoked by issuing the corrigendum dated 22.10.2024 (Annex.6), which is not the case in hand, inasmuch as area of Tiwadiya Fanta, for which NIT dated 30.10.2024 (Annex.2), had been issued, consists of a much broader lane, wherein the RMC/Bitumen Plant can be easily operated. He thus, submits that looking at the geographical location of the areas where the construction is to be done, allegations of discrimination and malafide levelled by the petitioner are baseless and devoid of merits.
15. Learned counsel for the respondent no. 1 also submits that in order to avoid the rift between the parties, to whom the RMC/Bitumen Plants can be leased out, this condition of ownership had been imposed and it is only the petitioner who is aggrieved of the said condition, i.e. clause 20 of the NIT dated 30.10.2024 (Annex.4), and he thus submits that the condition cannot be struck down merely because it does not suit the petitioner.
16. Learned counsel for the respondent no. 1 places reliance upon the following judgments
(a) Jagdish Mangal v. State of Orissa, reported in (2007) 14 SCC 517, passed by the Hon'ble Apex Court.
(b) Tata Motors Ltd. v. Brihan Mumbai Electric Supply and Transport Undertaking (BEST) and Ors. [Civil Appeal No. 3897 of 2023, decided on 19.05.2023], passed by the Hon'ble Apex Court.
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(c) M/s M.K. Enterprises v. State of Rajasthan [S.B. Civil Writ Petition No. 13491/2023 decided on 09.11.2023], passed by the Coordinate Bench of this Court.
17. Heard learned counsel for the parties, perused material available on record and judgments cited at the Bar.
18. The learned counsel for the petitioner, while placing reliance upon Section 4 and Section 6 of the RTPP Act, submits that clause 20 of the NIT (Annex.2) falls foul of both these provisions inasmuch as it does not provide fair and equitable treatment to bidders and is anti-competitive and this submission is on the anvil of the ground that there are only four contractors in Jodhpur who own RMC/Bitumen plant and in order to favour them such condition has been imposed. The relevant provision is reproduced as under:
"4. Fundamental principles of public procurement.-
(1) In relation to a public procurement, the procuring entity shall have the responsibility and accountability to -
(a) ensure efficiency, economy and transparency;
(b) provide fair and equitable treatment to bidders;
(c) promote competition; and
(d) put in place mechanisms to prevent corrupt practices. (2) Subject to the provision of sub-section (3) of section 3, every procuring entity shall carry out its procurement in accordance with the provisions of this Act and the rules and guidelines made thereunder.
xxxx
6. Participation of bidders.-
(1) The procuring entity shall not establish any requirement aimed at limiting participation of bidders in the procurement process that discriminates against or among bidders or against any category thereof, except when authorised or required to do so by this Act or the rules or guidelines made (Downloaded on 27/11/2024 at 09:46:41 PM) [2024:RJ-JD:47629] (8 of 15) [CW-18724/2024] thereunder or by the provisions of any other law for the time being in force.
xxxx"
However, when a specific query was made by this court as to whether petitioner has any factual data to support this submission that there are only four contractors owning their their own RMC/Bitumen Plant, he failed to provide any answer. Also, there is no pleading in the writ petition that there are only 'n' number of contractors having their own RMC/Bitumen Plant, which indicates that the petitioner, without having any data as to how many contractors are having their own RMC/Bitumen Plant and how many contractors are not owning the same, has raised this plea that it goes againt Section 4 of the RTPP Act, which provides that one of the fundamental principles of public procurement is to promote competition, and thus, in the absence of any data, to support the contentions of the petitioner to this aspect, this Court finds that the said contention is devoid of merits.
19. Further, the learned counsel for the petitioner has made a submission that such condition has been incorporated with malafide intention so as to reduce the competition and favour a few contractors, however, the petitioner has failed to make out a case how it is malafide and also to implead any such contractors to show the malafide intention on the part of respondent no.1. At this juncture, this court finds it apposite to refer to the judgment of the Hon'ble Supreme Court passed in Afcons Infrastructure Ltd. v. Nagpur Metro Rail Corpn. Ltd., (2016) 16 SCC 818, wherein it was observed that the threshold of malafides, intention to favour someone must be met before the constitutional court (Downloaded on 27/11/2024 at 09:46:41 PM) [2024:RJ-JD:47629] (9 of 15) [CW-18724/2024] interferes with the decision making process. The relevant paragraph of the aforesaid judgment is reproduced as under:
"13. In other words, a mere disagreement with the decision-making process or the decision of the administrative authority is no reason for a constitutional court to interfere. The threshold of mala fides, intention to favour someone or arbitrariness, irrationality or perversity must be met before the constitutional court interferes with the decision-making process or the decision. XXX
15. We may add that the owner or the employer of a project, having authored the tender documents, is the best person to understand and appreciate its requirements and interpret its documents. The constitutional courts must defer to this understanding and appreciation of the tender documents, unless there is mala fide or perversity in the understanding or appreciation or in the application of the terms of the tender conditions. It is possible that the owner or employer of a project may give an interpretation to the tender documents that is not acceptable to the constitutional courts but that by itself is not a reason for interfering with the interpretation given."
Thus, in cases where tenderer fails to show malafides on the part of the tendering authorities, the interference of the constitutional courts are not called for.
19.1. Further, the Hon'ble Supreme Court in Silppi Constructions Contractors v. Union of India, (2020) 16 SCC 489 has observed that the authority floating the tender is the best judge of its requirements and the court will only interfere to prevent arbitrariness, irrationality, bias, mala fides or perversity. The relevant paragraph of the aforesaid judgment is reproduced as under:
"20. The essence of the law laid down in the judgments referred to above is the exercise of restraint and caution; the need for overwhelming public interest to justify judicial intervention in matters of contract involving the State instrumentalities; the courts should give way to the opinion of the experts unless the decision is totally arbitrary or (Downloaded on 27/11/2024 at 09:46:41 PM) [2024:RJ-JD:47629] (10 of 15) [CW-18724/2024] unreasonable; the court does not sit like a court of appeal over the appropriate authority; the court must realise that the authority floating the tender is the best judge of its requirements and, therefore, the court's interference should be minimal. The authority which floats the contract or tender, and has authored the tender documents is the best judge as to how the documents have to be interpreted. If two interpretations are possible then the interpretation of the author must be accepted. The courts will only interfere to prevent arbitrariness, irrationality, bias, mala fides or perversity. With this approach in mind we shall deal with the present case."
Now coming to the facts of the present case, the petitioner has merely made allegations that clause 20 of the NIT (Annex.2) is incorporated with malafide intention in order to favour some contractors, however, nothing has been brought on record nor any factual data has been presented before this court to show that the imposition of the said condition has been done with malafide intention and would reduce the competition, thus, this court is unable to accept the contention of the petitioner in this regard. 19.2 Moreover, this Court also finds takes into consideration the judgment rendered by the Hon'ble Apex Court in the case of Ratnagiri Gas and Power Private Ltd. v. RDS Projects Ltd. And Ors. reported in (2013) 1 SCC 524, wherein the Hon'ble Apex Court had highlighted one of the most pertinent principles of administrative law that in cases where allegations of malafide are made, the persons against whom the same are made, need to be impleaded as parties to the proceedings, in their personal capacity, in order to enable them to answer. The relevant para of the judgment rendered in the case of Ratnagiri (supra) is reproduced as under:
"27. There is yet another aspect which cannot be ignored. As and when allegations of mala fides are made, the persons against whom the same are levelled need to be impleaded as (Downloaded on 27/11/2024 at 09:46:41 PM) [2024:RJ-JD:47629] (11 of 15) [CW-18724/2024] parties to the proceedings to enable them to answer the charge. In the absence of the person concerned as a party in his/her individual capacity it will neither be fair nor proper to record a finding that malice in fact had vitiated the action taken by the authority concerned......"
However, this Court finds that in the present case, learned counsel for the petitioner though alleges malafide on the part of a few bidders, however, the alleged blue-eyed bidders have not been impleaded to the proceedings. The relevant para of the writ petition is reproduced as under:
"(iv) That the respondent JDA had issued another NIT for undertaking construction of CC road at Ward No. 14, 16 Pratap Nagar, Jodhpur and in the clause 13 of the said also the respondent JDA had put the condition of submitting documents with regard to ownership of his own RMC plant.
However, for the reasons best known to the respondents, the respondent JDA issued a corrigendum on 22.10.2024 whereby, the clause 13 with regard to submitting the documents with regard to ownership of RMC plant was deleted. Thus, it is very much clear that the action of the respondents is nothing but arbitrary, illegal and discriminatory and it seems that the respondents want to give undue advantage to blue eyed persons with malafide intention by putting arbitrary condition in one NIT and waiving it off in another NIT."
20. The learned counsel for petitioner has further contented, while placing reliance on NG Projects (Supra), that clause 20 of the NIT (Annex.2) is arbitrary and the respondent no.1 has abused and exceeded its power by imposing such condition and therefore, judicial review of the same is called for. Before dealing with this contention, this court finds it apposite to refer to the judgment of the Hon'ble Supreme Court passed in Jagdish Mandal v. State of Orissa, (2007) 14 SCC 517, wherein it has (Downloaded on 27/11/2024 at 09:46:41 PM) [2024:RJ-JD:47629] (12 of 15) [CW-18724/2024] been observed that the purpose of the judicial review of administrative actions is to check whether the choice or decision is made lawfully and not to check whether such choice or decision is sound. The relevant paragraph of the aforesaid judgment in as under:
"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 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.(Downloaded on 27/11/2024 at 09:46:41 PM)
[2024:RJ-JD:47629] (13 of 15) [CW-18724/2024] If the answers are in the negative, there should be no interference under Article 226. ...."
Thus, the constitutional court before interfering in tender or contractual matters in exercise of its power of judicial review should restrict itself to check: (i) Whether the process adopted is malafide/intended to favour someone or is so arbitrary and irrational that the responsible authority acting reasonably and in accordance with the relevant law could not have adopted such process or made such decision?; (ii) Whether the public interest is affected by such actions?
Now coming to the facts of the present case the learned counsel for the petitioner has failed to demonstrate before this court as to under what provisions or rules the respondent no.1 has exceeded and abused its power and as to how it will affect the public interest. Further, as already been discussed in the preceding paragraphs the petitioner has failed to demonstrate before this court, the malafides on the part of the respondent no.1 in imposing condition contained in clause 20 in NIT (Annex.2), thus, the contention raised in this regard by the petitioner is devoid of any force.
21. The counsel for the petitioner has also contended that an identical condition (to that of condition no.20 in the present case) which was present in another NIT dated 15.10.2024 (Annex.5) issued by the respondent no.1 for undertaking construction of CC road at Ward No. 14, 16, Pratap Nagar, Jodhpur was deleted, vide the corrigendum issued on 22.10.2024 (Annex.6) thus, the incorporation of such condition in the NIT (Annex.2) is discriminatory and the respondent no.1 is trying to give undue advantage to blue-eyed persons with malafide intention. However, (Downloaded on 27/11/2024 at 09:46:41 PM) [2024:RJ-JD:47629] (14 of 15) [CW-18724/2024] this court, upon perusal of the photographs of both the sites (Annex. R/1 and R/2), finds that the proposed construction site in the NIT (Annex.2) is different from the construction site in NIT (Annex.5) inasmuch as in the present construction site there is enough space to install or operate RMC/Bitumen plant whereas at the construction site in NIT (Annex.5) there was lack of space in order to install or operate RMC/Bitumen plant and for this reason, the respondent no.1, being the best judge of its requirements and understanding of projects, waived the identical condition present in the NIT (Annex.5) vide the corrigendum issued on 22.10.2024 (Annex.6). Moreover, the counsel for the respondent no.1 has also explained before this court that clause 20 has been incorporated in NIT (Annex.2) in public interest as there is probability that in case of any rift between a tenderer and the person from whom he lease out the RMC/Bitumen plant, such projects of public interest might get delayed and in order to avoid such possibility this condition has been incorporated.
22. As far as the contention of the petitioner that the respondent no.1 ought to have been given relaxation of leasing out the RMC/Bitumen plant is concerned, this court finds that the petitioner has nowhere averred in the instant writ petition and not made any prayer in this regard that relaxation of leasing out RMC/ bitumen plant should be granted to the petitioner, thus, this court does not find any force with the contention of the petitioner in this regard as well.
23. Further, the learned counsel for petitioner has also raised a contention that order dated 27.06.2024 (Annex.3), issued by the Department of Finance, Government of Rajasthan, provides the (Downloaded on 27/11/2024 at 09:46:41 PM) [2024:RJ-JD:47629] (15 of 15) [CW-18724/2024] class of contractor who are qualified to tender the amount, and an AA Class contractor is qualified to tender any work upto any maximum amount and as per normal procedure of the bid, this type of condition was never put up by the respondent no.1 or any other department in previous tenders. However, this court does not find any force in this contention as the authority floating the tender is the best judge of its requirements and as already has been discussed in the preceding paragraphs the scope of judicial interference is very restricted in these matters and is only permissible if the process or decision is arbitrary or suffers from malafides.
24. Therefore, in view of the discussion in the above paragraphs, the instant writ petition does not warrants the interference of this court under Article 226 of the Constitution of India, 1950. Accordingly, the instant writ petition, being devoid of any merit, is dismissed. Any application(s), if pending, shall also stand dismissed. No order as to the cost.
(DR. NUPUR BHATI),J 321-/pradeep/-
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