Andhra Pradesh High Court - Amravati
M/S Hema Sri Securities, vs The Union Of India, on 15 July, 2021
Author: U. Durga Prasad Rao
Bench: U. Durga Prasad Rao
THE HON'BLE SRI JUSTICE U. DURGA PRASAD RAO
WRIT PETITION No.1329 of 2021
ORDER:
The petitioner prays for writ of mandamus declaring the action of the respondents 3 and 4 in not considering the bid of the petitioner who is the successful bidder and complied with all conditions and instead, issuing work order dated 22.09.2020 to 5th respondent, who was disqualified in the tender process i.e., in the financial bid (Annexure-III), as illegal, arbitrary and against the tender conditions and for a consequential direction to the respondents 3 & 4 herein not to enter into agreement with 5th respondent by virtue of the aforesaid work order dated 22.09.2020 and pass such other orders deemed fit.
2. The petitioner's case succinctly is thus:
(a) The petitioner's firm offers outsourcing manpower and security agencies to the State and Central Government Sectors and also Private Sectors. Pursuant to the tender notification in Government e-
Procurement system of the 1ST respondent (CPP Portal) dated 05.02.2020, the petitioner submitted e-Tender on 19.02.2020 by complying all terms and conditions. In the technical bid opened on 21.02.2020 at the office of 3rd respondent, the petitioner's technical bid along with other was approved. In the said bid the 5th respondent was also shown as approved. However, later the petitioner came to know that the 5th respondent failed to comply with the conditions of the tender notification, more particularly, Annexure-III of the Financial Bid. The 2 petitioner further came to know that the respondent authorities did not assign said work to 5th respondent till date and the 7th respondent who was unsuccessful in the tender process, is still continuing by virtue of the orders of this Court in W.P.No.17926/2020. In fact, the 7th respondent succeeded in the e-Tender for the earlier year 2018-2019 and as per the agreement with the respondent authority, she was extended for further time till 30.04.2021. The petitioner has no dispute with regard to the extension of the tenure of the 7th respondent, but the petitioner's main grievance is against the approval of the 5th respondent.
(b) The 5th respondent was disqualified in the e-Tender dated 05.02.2020, for, he quoted lesser wages than stipulated in the Annexure- III, but still he was declared as lowest bidder i.e., L1, which is highly illegal and arbitrary and his bid ought to be rejected in the said e-Tender, but due to extraneous consideration he was shown as successful bidder.
(c) Likewise the 6th respondent who was declared as lowest bidder at Sl.No.2 also has not complied with the terms of the notification, more particularly clause iv of the terms and conditions of the tender notification, as monthly bills shall be accompanied with the list showing the names of the staff, wages per month or day, number of duty days, total days to be paid each, total recoveries of ESI, EPF etc., and those conditions are absent in his tender application and therefore, the 6th respondent's bid ought to have rejected.
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(d) Further, the respondents 5 & 6 never rendered their services to the respondent authorities and therefore, considering them as L1 & L2 is quite contrary to the conditions of the tender.
Hence, the writ petition.
3. The respondents 1 to 4 filed counter opposing the writ petition and contending thus:
(a) The 3rd respondent invited the e-tender quotations dated 05.02.2020 for the agencies to provide manpower to perform jobs assigned to Staff Nurse, Office Assistant, Lab Technicians, Pharmacist, Cook, Security Guards, Multi Tasking Staff, Peon, Electrician, Plumber & Safaiwala to Regional Research Institute of Homeoopathy, Dr. GGH Medical College Campus, Eluru Road, Gudivada for a period of one year.
Nine bidders participated in the tender process and finally the following firms were approved by 3rd respondent by following the terms and conditions:
(a) M/s. Polasi Vasudeva Rao (R5) Rs.13,11,984.27 ps
(b) M/s. Sri Vijaya Durga House Keeping & Electricals and Works (R6) Rs.13,52,846.40 ps
(c) M/s. Hema Sri Securities Rs.13,78,936.60 ps
(b) For the next three financial bids under category-IV post, the wages mentioned are the minimum wages prevailing in Andhra Pradesh i.e., Rs.9155.30 ps or Rs.16,000/- per month fixed by the Council. The L1-M/s. Polasi Vasudeva Rao quoted the rates as per the wages 4 mentioned above. Hence, the selection of 5th respondent is not arbitrary and illegal or against the tender conditions. The L1 has quoted his rates in Annexure-III (Financial Bid) for category-III for Rs.17,000/- & Category-IV for Rs.14,000/-, whereas 3rd respondent enquired the L1 vide letter No.7-3/2018-19/CCRH/Estt/CS/Gudivada/PC-II/848 dated 21.08.2020 for non-compliance of the above rates prescribed by the Government of Andhra Pradesh or by the CCRH. Then the 5th respondent has agreed to pay wages for the Category-III at Rs.20,000/-
and for Category-IV at Rs.16,000/- vide its letter dated 24.08.2020. After that 3rd respondent has issued the approval letter in favour of 5th respondent and directed 4th respondent to issue the supply order and 4th respondent obliged and directed him to supply the manpower to RRI(H), Gudivada vide letter No.01/2019-20/RRI/GDV/Manpower/508 to 510 dated 22.09.2020. Thus, there is absolutely no arbitrariness or illegality in the selection of 5th respondent.
(c) As the interim orders were in vogue in W.P.No.6350/2020 and 17926/2020, the agreement could not be executed and work could not be entrusted to 5th respondent. Subsequently the above writ petitions were dismissed vide common order dated 27.01.2021. It is not true that the 5th respondent has not complied with the conditions of the tender notification.
(d) It is further submitted that the same issue was also raised in W.P.No.17926/2020 by 7th respondent herein and this Court was pleased to dismiss the said writ petition and W.P.No.6350/2020 vide common 5 order dated 27.01.2021. Hence, in the light of these facts the present writ petition is not maintainable and may be dismissed.
4. The 5th respondent filed counter contending as follows:
(a) The writ petitioner is guilty of suppressio veri and suggestio falsi and did not approach the Court with clean hands. The petitioner having participated in the tender process and filed its bid on 19.02.2020 vide bid No.1919125, suppressed the material fact that bid of 7th respondent vide bid No.1919034 dated 19.02.2020 was rejected by the respondents at the technical level itself. However, surprisingly the petitioner impleaded the 7th respondent and 8th respondent as parties to the writ petition while ignoring other bidders, who filed their respective bids on 12.02.2020, 14.02.2020, 19.02.2020 and 20.02.2020. This would show that the present writ petitioner and 7th respondent are in collusion with each other and writ petition is filed at the instance of 7th respondent.
7th respondent filed writ petition Nos.6350/2020 and 17926 of 2021 and the issues raised in the instant writ petition and those writ petitions are one and the same. Those writ petitions are dismissed by this Court through a common order dated 27.01.2021. The contract awarded in favour of the 5th respondent is not vitiated by illegality and arbitrariness and therefore, the writ petition is liable to be dismissed. The tender was finalized on 18.09.2020 on approval by the competent authority and the respondents have already given the work order to the 5th respondent and after long lapse of time they entered into an agreement with 5th respondent on 16.03.2021 and he already executed bank guarantee for 6 Rs.6,00,000/- on 06.10.2020 towards performance security and therefore, the writ petition is not maintainable at this stage.
(b) It is further submitted that the tender filed by 5th respondent is not contrary to Clause II-A and E of the tender. As per the terms and conditions of the tender, respondents can always negotiate the rates with L1. As such the respondent authorities have directed the 5th respondent to pay the wages as per Annexure-III of the tender vide Lr No.7- 3/2018/19/CCRH/Estt /CS/Gudivada/2459, dated 18.09.2020 and F.No.01/2019-20/RRI/GDV/ Manpower/508, dated 22.09.2020 which are not under challenge in this writ petition. As is held in the order dated 27.01.2021 in writ petition No.17926/2020, quoting lesser rates was rectified by the respondent and that the same cannot be gone into this writ petition. Hence, the writ petition may be dismissed.
5. The 5th respondent filed additional counter stating that the writ petitioner has no real interest and he was set up by the 7th respondent, whose bid was rejected on the technical level itself. The prayer in the present writ petition is similar to that of filed by the 7th respondent which was dismissed. The writ petition is bereft of merits and may be dismissed.
6. Heard arguments of Sri C. Prakash Reddy representing Sri B. Ramesh, learned counsel for the petitioner and Sri Pasala Ponna Rao, Central Government Standing Counsel representing respondents 1 to 4, 7 Sri M.R.K. Chakravarthy, learned counsel for respondent 5 and Sri V. Sai Kumar, learned counsel for respondent 7.
7. The main plank of argument of learned counsel for petitioner is that there are 4 categories of jobs and for each category, minimum wages that have to be paid by the outsourcing agency has been fixed. For instance, category-I carries wages @ Rs.30,000/- per month; category-II @ Rs.24,000/- per month; category-III @ Rs.20,000/- per month and category-IV @ Rs.16,000/- per month. However, the 5th respondent has quoted Rs.17,000/- p.m and Rs.14,000/- p.m for category III and IV respectively instead of Rs.20,000/- p.m and 16,000/- p.m as stipulated. As per the terms and conditions, his bid ought to be rejected. However, the official respondents have colluded with the 5th respondent and gave him an opportunity to re-quote the monthly emolument and selected him as L-1 to somehow confirm the tender in his favour. Thus the entire tender process is vitiated by arbitrariness and illegality. Learned counsel argued that in common order in W.P.Nos.6350/2020 and 17926/2020 filed by the 7th respondent, this Court no doubt discussed the very same point raised by the 7th respondent and negatived. However, since the petitioner is not a party respondent in those writ petitions, he is not bound by the findings in the said common order. He further argued that in the said common order no reason was assigned for dismissing the contention of the 7th respondent except stating that the error in quoting the lesser emoluments has been rectified by the 5th respondent. On that ground also the said common order is not binding in the instant case. To bolster his 8 argument, he placed reliance on Arnitdas Vs. State of Bihar1. He thus prayed to allow the writ petition.
8. Per contra, Sri Pasala Ponna Rao, Central Government Standing Counsel representing respondents 1 to 4 argued that the contention of the petitioner that despite 5th respondent quoting lower rates than the stipulated rates for category-III and IV, official respondents accommodated him by holding negotiations in violation of the terms of the tender notification, is far-fetching and unjustifiable for the reason that the terms of the notification has clearly provided for such negotiations by the authorities with the L1 tenderor. Referring to Sub Clause-iv of Clause-E under the caption "Evaluation criteria for Financial Bid" of E-Tender Document, learned counsel would argue that pursuant to the power conferred on the tendering authority, it has negotiated with 5th respondent who is the L1 and as he agreed to rectify the amounts for category III and IV to bring them to the minimum level by way of his letter dated 24.08.2020, the 3rd respondent has issued the approval letter. He would argue that since the terms and conditions of the tender are not under challenge, it does lie in the mouth of the petitioner to contend that the 5th respondent was unduly accommodated through negotiations. Thus he prayed to dismiss the writ petition.
9. Sri M.R.K. Chakravarthy, learned counsel for 5th respondent while arguing in similar lines, submitted that the writ petition is liable to be dismissed in limini since the petitioner was not qualified in the technical 1 (2005) 5 SCC 9 bid. This writ petition is not maintainable also for the reason that the petitioner did not seek for a consequential relief of confirming his tender by deleting the name of 5th respondent. Learned counsel vehemently argued that the 5th respondent complied with the mandatory condition of minimum wages by way of his letter dated 24.08.2020 after having negotiations with the tendering authority. Hence, on that ground also the writ petition is not maintainable. Finally, he argued that the petitioner utterly failed to establish that in the entire tender process, public interest was defeated. Hence, the writ petition is not sustainable. He thus prayed to dismiss the writ petition.
10. Sri V. Sai Kumar, learned counsel for 7th respondent while strongly refuting the allegation that the present writ petitioner is his proxy, argued that he has nothing to do with the writ petitioner. He further argued that since at the first instance, the 5th respondent failed to quote the wages for category III and IV in accordance with stipulation, the tender authorities should not have made any negotiations with him.
11. The point for consideration is, whether there are merits in the writ petition to allow?
(a) I gave my anxious consideration to the pleadings and respective arguments of the parties. The nub of the issue in this case is, the writ petitioner challenges the confirmation of the tender in favour of the 5th respondent on the main ground that the wages quoted by the 5th respondent for category III and IV jobs were far lesser than stipulated 10 amounts and on that ground alone his bid should have been rejected outright. However, the tendering authority has unjustly and illegally made negotiations with him somehow confirmed the bid in his favour by facilitating him to amend the emoluments quoted earlier by him.
(b) Per contra, it is the contention of the respondents 1 to 5 that the 5th respondent stood as L1 in other respects and as the tender conditions contain a clause to make negotiations with L1, in pursuance thereof L1 was confirmed and since he readily agreed to enhance the emoluments payable to category III and IV jobs to commensurate with the stipulation, tender was confirmed in its favour which is perfectly valid and legally sustainable.
(c) As can be seen from Annexure-III of E-Tender Document, dated 05.02.2020, minimum monthly wages per head payable by RRI are to the effect that category-I @ Rs.30,000/- per month; category-II @ Rs.24,000/- per month; category-III @ Rs.20,000/- per month and category-IV @ Rs.16,000/- per month. It is stated at the bottom of these rates (vide page-15 of E-Tender Document) that rates to be quoted either as per the minimum wages fixed by the Government of Andhra Pradesh or the minimum monthly wages payable by the Council whichever is higher as indicated in the tender document at Para No.1. So, the tenderors should quote either the minimum wages fixed by the Government of Andhra Pradesh or minimum monthly wages payable by the CCRH council whichever is higher. Be that it may, the 5th respondent said to have quoted Rs.30,000/- per month for category-I; Rs.24,000/- per 11 month for category-II; Rs.17,000/- per month for category-III and Rs.14,000/- per month for category-IV. Thus, it is obvious that wages quoted for category III and IV are lesser than the stipulated amounts. Perhaps on this count, learned counsel for petitioner vehemently argued that the bid of the 5th respondent is liable to be rejected in limini. However, that is not the end of the matter. In the E-Tender document, Sub Clause-iv of Clause-E under the caption "Evaluation criteria for Financial Bid" (Page-10 of E-Tender Document) reads thus:
"iv. In case it is found that different firms have quoted lowest service charges for different categories of employees/ workers, the L-1 firm will be decided on the basis of lowest service charge for all categories of employees on cumulative basis. The negotiation of rates, if required, would be held with the L-1 firm considering the reasonability of rates for different categories."
Thus, the above condition would show that the tendering authority has power to negotiate with the L-1 for the rates quoted considering the reasonability of the rates for different categories. Therefore, I find any amount of force in the arguments of respondents 1 to 5 that the tendering authority is empowered to make negotiations with the 5th respondent who is the L1. As rightly argued by the respondents, the petitioner has not challenged the legality and validity of the terms of the E-Tender Document including the above term.
12. In that view, he cannot now harp that the official respondents colluded with the 5th respondent and held negotiations to accommodate him. The contentions of the petitioner are far-fetched and the writ 12 petition does not merit consideration. So far as common order in writ petition Nos. 6350/2020 and 17926/2020 is concerned, since the petitioner was not a party therein, the said order is not binding on him. However, that fact has no impact on the result in this writ petition. The decisions cited by the petitioner do not advance his cause. Accordingly, this writ petition is dismissed. No costs.
As a sequel, interlocutory applications pending, if any, shall stand closed.
__________________________ U. DURGA PRASAD RAO, J 15th July, 2021 krk 13 THE HON'BLE SRI JUSTICE U. DURGA PRASAD RAO W.P No. 1329 of 2021 15th July, 2021 krk