Orissa High Court
Chandra Sekhar Swain vs State Of Odisha And Others on 3 March, 2017
Equivalent citations: AIR 2017 (NOC) 1071 (ORI.)
Author: Vineet Saran
Bench: Vineet Saran
ORISSA HIGH COURT: CUTTACK
W.P.(C) NO. 21355 OF 2016
AND
W.P.(C) NO. 19976 OF 2016
AFR
In the matter of applications under Articles 226 and 227 of the
Constitution of India.
----------------
Chandra Sekhar Swain (in both) ......... Petitioner
Versus
State of Odisha and others (in both) ......... Opp. Parties
For petitioner : Mr. R.K. Rath, Sr. Advocate
along with M/s. U.C. Mohanty,
T. Sahoo, B.K.Swain, P.B. Mohapatra
and S.K. Pattanaik, Advocates
For opp. parties : Mr. P.K. Muduli,
Addl. Government Advocate
PRESENT:
THE HON'BLE THE CHIEF JUSTICE MR. VINEET SARAN
AND
THE HON'BLE DR. JUSTICE B.R.SARANGI
Date of hearing : 21.02.2017 :: Date of Judgment : 03.03.2017
DR. B.R. SARANGI, J. Chief Engineer, World Bank Project, Odisha,
Bhubaneswar invited bids vide Bid Identification No. CE-WBP
(O)-02/2016-17 (Final No.P-IM-Misc.-10/2008 (Pt) No.18972
dated 30.04.2016) in respect of the work "Improvement to
Rajnagar-Dangamala-Talachuan road from 0.0 to 8.290 Km in
2
the District of Kendrapara under NABARD Assistance" for a
contract value of Rs.10,36,50,709.00 with the period of
completion within ten calendar months.
2. The petitioner participated along with another bidder
in the said tender process and, being qualified in the technical
as well as price bids evaluated on 22.07.2016 and 27.08.2016
respectively, was declared as L-I. The work value being more
than rupees ten crores, the recommendation of the tender
committee was placed before the Engineer-in-Chief-cum-
Secretary to the Government, Works Department, Odisha vide
letter no.40514 dated 14.09.2016 for approval. As the matter
was kept pending for a quiet long time, the petitioner
approached this Court by filing WP(C) No.19976 of 2016. By
order dated 16.11.2016, when the matter was placed for the
first time, this Court called upon learned Addl. Government
Advocate to obtain instructions or file counter affidavit within a
period of ten days. On 30.11.2016, when the matter was listed
again, the learned Addl. Government Advocate prayed for and
was granted further time till 07.12.2016 to obtain instructions
or file counter affidavit.
3. During pendency of WP(C) No.19976 of 2016,
petitioner preferred WP(C) No.21355 of 2016 alleging therein
that on the very same day, i.e., 30.11.2016, when the State
3
Counsel took further time till 07.12.2016 to obtain instructions
or file counter affidavit, the opposite parties cancelled the
previous tender and issued a fresh tender vide Annexure-8
thereto. The said writ petition (WP(C) No.21355 of 2016) was
listed on 06.12.2016, on which date learned Addl. Government
Advocate was directed to obtain instructions and produce the
records pertaining to the case on the next date, which was fixed
to 19.12.2016. When WP(C) No.19976 of 2016 was listed on
07.12.2016, it was directed to be listed on 19.12.2016 under the heading "Fresh Admission". However, in WP(C) No.21335 of 2016, by order dated 22.12.2016 this Court permitted the petitioner to file his tender in response to the fresh tender call notice dated 30.11.2016. On 11.01.2017, this Court passed an interim order in Misc. Case No.21058 of 2016 that, till 19.01.2017, any contract awarded in pursuance of the fresh tender call notice dated 30.11.2016 would be subject to further order to be passed in the writ petition. By order dated 19.12.2016 passed in WP(C) No.19976 of 2016 this Court directed that the said matter would be listed along with WP(C) No.21355 of 2016. Hence, both the writ petitions have been heard analogously and are disposed of by this common judgment.
4
4. The factual matrix of the case, as is borne out from the records of both the writ petitions, is that the petitioner is a super class contractor having registration no.477/2016 issued by the Chairman of the Committee of Chief Engineers and Engineer-in-Chief (Civil), Bhubaneswar dated 31.05.2016, which is valid up to 31.03.2019. Opposite Party No.2 vide tender call notice dated 30.04.2016 (Annexure-1 to WP(C) No.219976 of 2016) invited bids only on "online" up to 07.06.2016 with the stipulation for opening of the bids on 16.06.2016 at 11.30 hours in the office of the Engineer-in-Chief (Civil), Nirmana Saudha, Unit-V, Bhubaneswar in presence of the bidders. As per clause-5 of the Detailed Tender Call Notice (DTCN), the bid was to be submitted in two covers. Cover-I was to contain scanned EMD, Cost and Vat of bid document, DTCN, scanned copy of contractor registration certificate for execution of civil works, PAN card, valid VAT clearance certificate required under Section 99 of Odisha VAT Act, besides other documents. Cover-II was to contain the price bid duly filled in and signed by the bidder. Clause-7 of the DTCN provided the documents to be produced by the successful lowest bidder, whereas clause-8 provided the work to be completed in all respect within the time period as specified in the Contract Data. Clause-10 of the DTCN 5 stipulated the various conditions to be complied with, while submitting bids, by the contractors.
5. Pursuant to the above tender call notice, the petitioner, in compliance of the conditions stipulated in the DTCN, furnished the affidavit of authentication and agreement for hiring machineries with one Subala Behera, which was valid for a period of twelve months commencing from 04.07.2016. Petitioner also extended the aforesaid agreement dated 04.07.2016 up to 02.11.2018 vide agreement dated 29.10.2016 covering the period from 03.06.2017 to 02.11.2018.
6. As per schedule, the technical bids were opened on 22.07.2017. The technical evaluation committee, which evaluated the technical bids, in which only the petitioner and one Sanjay Kumar Samntaray had participated, found them qualified and accordingly on 27.08.2016 recommended for consideration of their price bids. On the basis of such recommendation of the technical evaluation committee, the price bids were opened on 31.08.2016 at 4.30 p.m. and the finding thereof was floated on the website (e-Procurement System Government of Odisha) wherein the petitioner was found to be lowest successful bidder having quoted the lowest price of Rs.10,06,10,633.76 against the estimated rate of Rs.10,36,50,709.0602. The Chief Engineer, World Bank 6 Project, Odisha recommended the offer of the petitioner, being the lowest one and submitted the additional performance security amounting to Rs.30,42,000.00 against the requirement of Rs.30,40,075.00, and sought for administrative approval as per the codal provision, since the amount was more than rupees ten crores. Even though the recommendation was made by the Chief Engineer, World Bank Project, Odisha, as no action was taken, the petitioner approached this Court by filing WP(C) No.19976 of 2016.
7. When the above noted writ petition was pending before this Court and learned counsel appearing for State was asking for time to obtain instructions or file counter affidavit, on 17.11.2016, the Government of Odisha in Works Department communicated the Chief Engineer, World Bank Project, Odisha, to re-evaluate the bids and to take follow-up action under intimation to the Department. Pursuant to such letter, the Chief Engineer, World Bank Project, Odisha without issuing any intimation to the petitioner issued the 3rd corrigendum to Bid Identification No.CE-WBP(O)-02/2016-17 on 30.11.2016, whereby the previous tender for the work in question was cancelled without assigning any reason, and invited fresh tenders on the very same day, vide Annexures-7 and 8 7 respectively which are the subject-matter of challenge in W.P.(C) No.21355 of 2016.
8. Mr. R.K. Rath, learned Senior Counsel appearing along with Mr. U.C. Mohanty, learned counsel for the petitioner stated that pursuant to the tender call notice issued on 30.04.2016 (Annexure-1), the petitioner participated in the tender process and was found to be L-1. His case was recommended by the Chief Engineer, World Bank Project, Odisha for approval by the Government, as the tender amount was exceeding rupees ten crores. There was no valid and justifiable reason to cancel the said tender and invite a fresh tender on 30.11.2016, when the inaction on the part of the authority in approving the L-1 bidder was pending consideration before this Court in W.P.(C) No.19976/2016. Therefore, such cancellation of tender dated 30.04.2016 and issuance of fresh tender dated 30.11.2016 is not justified and hit by the principle of lis pendence. It is further contended that, when in one hand State counsel was asking for time to get instructions or file counter affidavit on 30.11.2016, on the very same day the cancellation of earlier tender dated 30.04.2016 in respect of the work in question and issuance of fresh tender should not have been done without affording opportunity of hearing to the petitioner, when admittedly he was L-1 assessed 8 by the tender committee and recommendation was pending before the Government for approval. It is also contended that the action of the authority is arbitrary, unreasonable and contrary to the provisions of law. Therefore, the petitioner seeks interference of this Court. To substantiate his contention, he has placed reliance on M/s. Shree Ganesh Construction v. State of Orissa and others, 2016(II) OLR 237; M/s. D.K. Engineering v. State, 2016(II) ILR-CUT-515; Bhupendra Kumar Dash v. State of Odisha and others, 2016(ILR-CUT- 760; Homogenomics Private Ltd. V. State of Odisha, AIR 2016 Orissa 178; Rashmi Metaliks Limited and another v. Kolkata Metropolitan Development Authority and others, (2013) 10 SCC 95; Om Prakash Sharma v. Ramesh Chand, AIR 2016 SC 2570; State of Punjab v. Bandeep Singh and others, (2016) 1 SCC 724; Union of India v. Dinesh Engineering Corporation, AIR 2001 SC 3887; Food Corporation of India v. M/s. Kamdhenu Cattle Feed Industries, AIR 1993 SC 1601; M/s. Star Enterprises and others v. City and Industrial Development Corporatin of Maharashtra Ltd. and others, (1990) 3 SCC 280; Bakshi Security and Personnel Services Pvt. Ltd. V. Devkishan Computed P. Ltd. and an unreported judgment passed in 9 W.P.(C) NO.2529 of 2016 (Manash Kumar Sahu v. State of Odisha and others) disposed of on 19.07.2016.
9. Mr. P.K. Muduli, learned Additional Government Advocate for the State raised a preliminary objection with regard to participation of the petitioner in the tender dated 30.04.2016 (Annexure-1), as the petitioner incurred disqualification in view of non-availability of an agreement on the date of submission of tender for the period from 04.07.2016 to 02.11.2018. Thereby, it is contended that fraud vitiates the entire process of consideration in technical bid by the authority concerned and, consequentially, no illegality or irregularity has been committed in cancelling the contract. It is also contended that even if the petitioner's name was recommended by the Chief Engineer, World Bank Project to the Government for approval, since no approval was incurred no right accrued in favour of the petitioner to claim that the contract should be awarded in his favour. As such the authority has got power to reject the bid without assigning any reason as per the terms of the Detailed Tender Call Notice (DTCN). It is contended that even if the petitioner was not eligible to be considered and under mistake of fact he was considered and subsequently the same was brought to the notice of the authority, the authority has got power to rectify its own mistake. Above all, it is further 10 contended that for cancellation of the tender process, opportunity of hearing is not required. To substantiate his contention, he has relied upon State of Uttar Pradesh v. Al Faheem Meetex Private Ltd., (2016) 4 SCC 716; State of Jharkhand v. M/s. CWE-SOMA Construction, AIR 2016 SC 3366; Rishi Kiran Logistics v. Board of Trustees, (2015) 13 SCC 233; Pramod Kumar Sahu v. State of Odisha and others, 2016(II) OLR 819 and State of Andhra Pradesh v. T. Suryachandra Rao, AIR 2005 SC 3110.
10. For just and proper adjudication of the case, the relevant portions of the Bid Identification, as contained in the Notice Inviting Tender, are extracted hereunder:
"Clause-4. The Bid documents will be available in the website:
htpp://tendersodisha.gov.in from 10.00 AM of 0905.2016 to 5.00 PM of 07.06.2016 for online bidding. Any addendum/corrigendum/cancellation of tender can also be seen in the said website.
xx xx xx
GENERAL INFORMATIONS
xx xx xx
B. BID INFORMATION
xx xx xx
10. Last date and time of Time: 5.00 PM
submission of Bid (Clause No.2 Date: 07.06.2016 of DTCN) Opening of Technical Bid Time: 11.30 AM (Cover-I document (Clause No.3 Date: 16.06.2016 of DTCN) 11
14. Intended completion period/ 10(ten) Calendar Time period assigned for Months Completion as per clause 8 of DTCN.
15. Bid validity period (Clause No.9 90 days of DTCN).
16. Minimum period of contract / 13 (thirteen) agreement/ lease deed of Calendar Months equipment and machineries as per Clause No.10(v) of DTCN.
Detailed Tender Call notice for Road and Bridge Works xx xx xx Clause 10. (i) The Contractors are required to furnish evidence of ownership of principal machineries/ equipments in Schedule-C as per Annexure-1 for which contractor shall have to secure minimum 80% of marks failing which the tender shall be liable for rejection.
(ii) In case the contractor executing several works he is required to furnish a time schedule for movement of equipment/machinery from one site to work site of the tendered work in Annexure-IV of Schedule-C.
(iii) The contractor shall furnish ownership documents for those machineries which he is planning to deploy for the tendered work if these are not engaged and produce certificate from the Executive Engineer as per Annexure-III of Schedule- C under whom these are deployed at the time of tendering as to the period by which these machines are likely to be released from the present contract. Certificate from the Executive Engineer of Government of Odisha or Engineer-in-Charge of the project (in case of non-Government projects) under whose jurisdiction the work is going on, shall not be more than 90 days old on the last date of receipt of tender.
(iv) In case the contractor proposes to engage machineries and equipments as asked for in the tender document, owned or hired but deployed outside the State, he/she is required to furnish additional 1% EMD/Bid Security. The entire bid security including the additional bid security shall stand forfeited in case the contractor fails to mobilize the machineries within a period as to be able to execute an item of work as per original programme which will be part of the agreement.
(v) The contractor intending to hire/lease equipments/ machineries are required to furnish proof of ownership from the 12 company/person providing equipments/ machineries on hire/lease along with contracts/ agreements/lease deed and duration of such contract. The contracts/agreements /lease deed should be on long term basis for a minimum period of as mentioned in contract data from the last date of receipt of Bid documents.
xx xx xx
Clause 121.4 : Equipment capabilities: Fulfilling
requirement of Clause 10 above
xx xx xx
Clause 122- The bidder must fulfill the eligibility criteria & qualifying criteria in order to qualify for the bid:
A. ELIGIBILITY CRITERIA: To be eligible for evaluation of qualifying criteria, applicants shall furnish the followings.
a. Required E.M.D (Bid Security) as per the clause No.06.
b. Scanned Copy of valid Registration Certificate, Valid VAT clearance certificate, PAN card along with the tender documents as per Clause No.07.
c. Information regarding (i) Evidence of ownership of principal machineries/equipments in Schedule-C as per Annexure-I of Schedule-C (ii) Annexure-III of Schedule-C & (iii) Annexure-IV of Schedule-C if required as per Clause No.10 scanned copy of all documents are to be furnished with the bid.
d. Information in scanned copy regarding current litigation, debarring/expelling of the applicant or abandonment of work by the applicant in schedule "E" and affidavit to that effect including authentication of tender documents in schedule "F" as per clause 11.
e. Information regarding experience in similar nature of works in Schedule D-1 and progress of Civil Engineering works in Schedule-D 2 as per Clause No.13 with scanned copy of experience certificate.
f. Submission of original bid security and tender paper cost as prescribed in the relevant clause of DTCN after last date and time of submission of bid but before the stipulated date and time for opening of the bid. Non-submission of original bid security and cost of bid document within the designated period shall debar the bidder from participating in the on-line bidding system and his 13 portal registration shall be cancelled. His name shall also be informed to the registering authority for cancellation of his registration.
B) QUALIFYING CRITERIA: As per Clause-121 of DTCN."
11. In compliance of the tender conditions, as discussed above, the petitioner submitted relevant documents. The technical evaluation committee in its meeting held on 27.08.2016 at 4.30 P.M. under the Chairmanship of Engineer- in-Chief (Civil), Odisha, Bhubaneswar scrutinized the technical bids under Agenda No.2 and found as follows:
"Sri Chandra Sekhar swain, super Class Contractor:
The bidder have furnished the Demand Draft of State Bank of India, Patamundai Branch, Kendrapara bearing No.474937 dated 08.07.2016 amounting to Rs.10,500.00 towards required paper cost and required EMD in shape of Term Deposit Advice A/C NO.35844402780 dated 17.06.2016 of State Bank of India, Rajnagar Branch, Kendrapara amounting to Rs.10,37,000.00 duly pledged in favour of executive Engineer, Kendrapara (R & B) Division, Kendrapara. The bidder has furnished copy of Registration Certificate valid up to 31.03.2019, VAT clearance certificate valid up to 31.03.2017 & PAN Card. He has secured 100% marks in respect of required machineries against minimum requirement of 80% as per DTCN Clause No.10. The bidder has Bid capacity of Rs.40.01 Crore against requirement of Rs.9.76 Crore and hence has satisfied the qualifying criteria for bid capacity as per Clause No.121.7 of DTCN. The bidder has satisfied the experience criteria as per Clause No.121 of DTCN.
All other requirement of eligibility criteria and qualifying criteria as per DTCN Clause No.122 have been fulfilled." And consequentially recommendation was made to the following effect:
Recommendation "After detailed discussion and deliberation the committee unanimously recommended to qualify the Technical Bid (Cover-14
I) of both the bidders (i) Sri Sanjay Kumar Samantray, Super Class Contractor & (ii) Sri Chandra Sekhar Swain, Super Class Contractor for fulfilling all the eligibility criteria and qualifying criteria as per requirement of Clause No.122 of DTCN."
12. Thereafter, the price bids were opened and, accordingly, the Chief Engineer, World Bank Project, Odisha vide letter dated 14.09.2016 made following recommendations in respect of the petitioner:
"After opening of Price Bid (Cover-II) it is observed that, the 1st lowest bidder Sri Chandra Sekhar Swain, Super Class Contractor has quoted 2.933% less than the estimated cost of Rs.10,36,50,709.00 put to tender at S/R-2014, with corresponding bid amount of Rs.10,06,10,634.00 as appeared in the computer generated comparative statement (copy enclosed). The 1st lowest bidder has submitted the Additional Performance Security Deposit amounting to Rs.30,42,000.00 against the requirement of Rs.30,40,075.00 according to their bid amount.
Administrative Approval for Rs.10,81,86,000.00 has been accorded for this work by Government in Works Department vide letter No.9833 dated 05.08.2016."
13. On 07.11.2016, the tender committee meeting was held at 4.30 p.m. in the conference hall of the Works Department and under item No.11 the work in question was again considered and the decision to the following effect was taken:
"11. Improvement to Rajnagar- Dangamala-Talachuan road from 0.0 to 8.200 Km in the District of Kendrapara under NABARD Assistance RIDF-XXII The Chief Engineer, World Bank Projects, Odisha has recommended the lowest tender of Sri Chandra Sekhar Swain, Super Class contractor amounting to Rs.10,06,10,634.00 (Rupees Ten Crore Six Lakh Ten Thousand Six Hundred Thirty- Four) only which is 2.933% less than the corresponding 15 estimated cost of Rs.10,36,50,709.00 put to tender at S.R-2014 for approval of Government.
Administrative Approval for Rs.10,81,86,000.00 has been accorded vide Works Department Letter No.9833 dated 05.08.2016.
Revisided Technical sanction for an amount of Rs.10,36,50,709.00 vide Sl. No.06/2016-17 of Technical Sanction Register of C.E. World Bank Projects, Odisha. The total completion period of the work is 10(Ten) calendar months.
The amount put to tender for the work is Rs. 10,36,50,709.00 at S/R-2014.
There is a Budget provision of Rs.0.02 lakh for this project during the Outcome Budget 2016-17.
The tender for the above work being invited through Bid Identification No. C.E.-WBP (O)-02/2016-17 issued dated 30.04.2016.
The NIT was published in the English National Daily "The Times of India" on 07.05.2016 and in the Odia daily "The Dharitri" on 08.05.2016. The NIT was also posted to the State Govt. Website. The sale and receipt of the Bid document was allowed for 70 days. In response to the NIT, two numbers of bids were received from the following contractors within stipulated date and time.
1. Sri Sanjay Kumar Samantaray, super class Contractor
2. Sri Chandra Sekhar Swain, Super Class Contractor The technical bids of all the bidders were opened on 22.07.2016 and scrutinized by the Evaluation Committee chaired by the EIC (Civil), Odisha on 27.08.2016. The Technical Committee found both the bidders to be qualified for opening of their cover-II Price Bid.
The cover-II (Price Bid) of both the qualified bidders were opened and worked out to be as follows:
Sl. Name of the Quoted Calculated Amount
No. Bidder Rate
1. Sri Chandra Sekhar 2.933% Rs.10,06,10,134.00
Swain, Super Class
Contractor
2. Sri Sanjay Kumar At par Rs.10,36,50,709.00
Samantaray, Super
Class Contractor
16
As reported by the Chief Engineer, World Bank Projects, Odisha the lowest bidder has satisfied the qualifying criteria for bid capacity.
The tender was placed before the Tender Committee of Works Deptt. In their meeting held on 07.11.2016 at 4.30 P.M. in the Conference Hall of Works Department for detailed discussion. During discussion, the allegation received against the lowest bidder was raised. The CE apprised the Committee that the Technical Evaluation Committee has inadvertently qualified the bidder when the validity8 of lease deed of machineries/equipment of the L1 bidder is up to 03.07.2016 against the requirement up to 17.08.2016. So, after detailed discussion the Committee unanimously decided to recommend that the tender be evaluated again by the Technical Evaluation Committee strictly as per conditions of DTCN."
14. On 17.11.2016, a communication was made to the Chief Engineer, World Bank Projects, Odisha stating that the tender committee in its meeting held on 07.11.2016 has recommended for evaluation of bid again by the technical evaluation committee strictly as per conditions of DTCN. Accordingly, follow-up action should be taken by the Chief Engineer, Work Bank Projects. The Technical Evaluation Committee in its meeting held on 28.11.2016 scrutinized the technical bid and observed as follows:
Observation by the Committee:-
"As per direction of Government in Works Department vide letter No.14700 dt.17.11.2016, the committee examined thoroughly again for the Technical Bid (Cover-I) documents of the bidder Sri Chandra Sekhar Swain, Super Class Contractor and following observations made:-
Clause No.10(v) of the DTCN states "The contractor intending to hire/lease equipments/machineries are required to furnish proof of ownership from the company/per providing equipments/machineries on hire/lease along with contracts/agreements/lease deed and duration of such contract. The contracts/agreements/lease deed should be on 17 long term basis for a minimum period of as mentioned in contract data from the last date of receipt of Bid documents".
As mentioned in the contract data at Sl. 16 the minimum period of contract/agreement/lease deed of equipments and machineries is 13(thirteen) calendar months. In this case Sri Chandra Sekhar Swain, super Class contractor has made lease deed Agreement with two machine owners on dt. 04.07.2016 for 12 (twelve) months as such lease deed is valid upto 03.07.2017. Requirement of validity of lease deed should be upto 13 months from last date of receipt of bid i.e. 13 months from 18.07.2016 which is upto 17.08.2017. As such there is a gap of 1 month 14 days against requirement as per DTCN. The eligibility criteria as 121 of DTCN states "The bidder must fulfill the eligibility and qualifying criteria in order to qualify the bid" Committee observed that the bidder Sri Chandra Sekhar Swain, Super class Contractor has not fulfilled the eligibility criteria at 122 © of DTCN as requirement of clause 10(v) of DTCN is not fulfilled. So there is a shortfall with a gap of one month and 14 days against requirement as per Clause No.10(v) of DTCN as submitted by the bidder Sri Chandra Sekhar Swain, Super Class contractor. Recommendation After detailed discussion and deliberation the committee unanimously recommended to cancel the above tender and to invite fresh tender for better competition. The meeting ended with vote of thanks to the Chair."
15. From the aforesaid, what can be followed is that the technical evaluation committee inadvertently qualified the bidder, inasmuch as the validity of the contract/agreement/ lease deed of the equipments/machineries was not in accordance with the requirement stipulated in the Contract Data. As mentioned in the Contract Data at Sl. No.16, the minimum period of contract/agreement/lease deed of the equipment/machineries should have been for a period of 13 calendar months from the last date of receipt of the bid 18 documents, i.e., from 18.07.2016 up to 17.08.2017. But, as a matter of fact, the lease deed/ agreement, which was furnished by the petitioner with two machine owners, was dated 04.07.2016 for a period of 12 months. That means, the lease deed is valid up to 03.07.2017, whereas, as per the requirement, it should have been for 13 months from the last date of receipt of the bid. Therefore, there was a gap of one month and 14 days against requirement as per the DTCN. Furthermore, lease agreement, which was furnished by the petitioner, is stated to have been executed on 04.07.2016 and further extension of the lease deed was admittedly executed and registered on 29.10.2016. So, it can be safely construed that by the time the tender document was submitted for consideration of technical bid, the petitioner did not comply with the conditions stipulated under Clause-121 of the DTCN. Therefore, the petitioner's technical bid was inadvertently qualified by the technical evaluation committee at its first instance and on that basis recommendation was made by the Chief Engineer, World Bank Projects, Odisha for approval by the Government. But, on scrutiny of the documents, the Government decided to reconsider the same and to make re-evaluation by the technical committee and on reconsideration of the same the technical evaluation committee recommended to cancel the tender. In 19 such view of the matter, it cannot be construed that any illegality or irregularity has been committed by the authority in cancelling the tender on 30.11.2016 on the basis of the recommendation made by the tender evaluation committee dated 28.11.2016.
16. In the above context, the law is fairly settled that if an inadvertent mistake/error is found to be committed by the technical evaluation committee, while evaluating the technical bids, and subsequently it is required to be corrected, the authority has got every power to do the same. The ratio decided by this Court in Pramod Kumar Sahu (supra) is applicable to the present context. To be more specific, merely because recommendation was made by the Chief Engineer, World Bank Projects, Odisha, on consideration of the erroneous evaluation made by the technical evaluation committee, to the State Government for approval, that by itself does not create any right in favour of the petitioner to award the work in his favour. When the bid of the petitioner was not accepted by the State/competent authority, no right could accrued in favour of the petitioner to award the work.
17. In State of Uttar Pradesh and another (supra), the apex Court in paragraphs-14 and 15 held as follows: 20
"14. We find force in the aforesaid argument of the learned counsel for the appellants. In the first instance, it is to be noted that BEC is only a recommendatory authority. It is the competent authority which is to ultimately decide as to whether the recommendation of BEC is to be accepted or not. We are not entering into the discussion as to whether this competent authority is the State Government or the Municipal Corporation. The fact remains that there is no approval by either of them. Matter has not even reached the competent authority and no final decision was taken to accept the bid of Respondent 1 herein. Much before that, when BEC was informed that there were only two valid bids before it when it made its recommendation on 8-9-2010 and as per the Financial Rules there must be three or more bids to ensure that bidding process becomes competitive, BEC realised its mistake and recalled its recommendation dated 8-9-2010. It cannot be said that such a decision was unfair, mala fide or based on irrelevant considerations. This, coupled with the fact that the authority has right to accept or reject any bid and even to annul the whole bidding process, the High Court was not justified in interfering with such a decision of BEC.
15. The High Court has also gone wrong in finding fault with the decision of BEC by holding that such a subsequent decision could not have been taken by BEC without notice to or in the absence of the appellant. When the decision-making process had not reached any finality and was still in embryo and there was no acceptance of the bid of Respondent 1 by the competent authority, no right (much less enforceable right) accrued to Respondent 1. In such a situation, there was no question of giving any notice or hearing to Respondent 1."
18. In State of Jharkhand (supra), the apex Court in paragraphs 12 and 14 held as follows:
"12. In case of a tender, there is no obligation on the part of the person issuing tender notice to accept any of the tenders or even the lowest tender. After a tender is called for and on seeing the rates or the status of the contractors who have given tenders that there is no competition, the person issuing tender may decide not to enter into any contract and thereby cancel the tender. It is well-settled that so long as the bid has not been accepted, the highest bidder acquires no vested right to have the auction concluded in his favour (vide Laxmikant and Ors. v. Satyawan and Ors. (1996) 4 SCC 208: (AIR 1996 SC 2052); Rajasthan Housing Board and Anr. v. G.S. Investments and Anr. (2007) 1 SCC 477 : (2006 AIR SCW 5968) and Uttar Pradesh Avas Evam Vikash Parishad and Ors. v. Om Prakash Sharma (2013) 5 SCC 182 : AIR 2013 SC (Supp) 495))."21
"14. The State derives its power to enter into a contract under Article 298 of the Constitution of India and has the right to decide whether to enter into a contract with a person or not subject only to the requirement of reasonableness under Article 14 of the Constitution of India...."
19. As there is no concluded contract exists between the parties, the claim made by the petitioner to award the contract in his favour on the basis of recommendation made by the Chief Engineer, World Bank Projects, Odisha to the Government for approval by virtue of the erroneous consideration made by the technical evaluation committee, cannot be acceded to. Direction given for re-evaluation of the assessment made by the tender committee on the basis of the materials available cannot be also said to be mala fide exercise of power by the authority concerned. If the DTCN specifies the mode of submission of tender document and that mode is found to have been not followed, the submission of tender document itself is defective one. The tender document has to be in consonance with the DTCN and it must be unconditional one and in proper form. Merely because the petitioner was found, on consideration of an erroneous document, to have quoted lowest price, that by itself cannot create a right in favour of the petitioner, unless the parties have entered into agreement and there is concluded contract to that extent. Reference made to Rishi Kiran 22 Logistics mentioned (supra), in our view, is squarely applicable to the present context.
20. On the basis of the pleadings available on record and also materials produced before this Court, the cancellation of bid made by the authority has got ample justification, as there was erroneous consideration by the technical evaluation committee and non-compliance of the provisions contained in Clause-10 read with Clause-121 of the DTCN. The contention raised by learned Addl. Government Advocate, that fraud vitiates everything, has no bearing in the instant case. Ordinarily, fraud is proved, when it is shown false representation has been made knowingly. But, as has been stated earlier, in the instant case evidently the technical evaluation committee had erroneously considered the documents submitted by the petitioner which has been subsequently rectified on the basis of the direction given by the Government/appropriate authority.
21. Annexure-7 dated 30.11.2016 is the order impugned, whereby the bid in respect of the work in question has been cancelled. The contention raised by learned Senior Counsel for the petitioner is that no reason has been assigned in support of such cancellation. To buttress his contention, he has placed reliance on M/s. Shree Ganesh Construction 23 (supra). On perusal of the materials available on record, it appears that on 28.11.2016 the technical evaluation committee scrutinized the technical bids afresh on the basis of communication made on 17.11.2016. The proceedings of the technical evaluation committee held on 28.11.2016, which indicate the reasons for cancellation of the tender in question, were evidently made available on the website. On the basis of such reasons, as a consequential follow up action, the cancellation order was passed on 30.11.2016 in Annexure-7. In view of that, it cannot be said that the order of cancellation is a cryptic one, particularly when the same has been explained subsequently in the counter affidavit. If the reasons were available to the parties on the website on the date of cancellation, i.e., on 28.11.2016 itself, the communication vide Annexure-7, which was made on 30.11.2016, cannot be held to be unsustainable in the eye of law for not containing the reasons for cancellation of the bid in question. As such, the ratio decided in M/s. Shree Ganesh Construction (supra) is absolutely not applicable to the present case.
22. The facts and circumstances of the case in M/s. D.K. Engineering (supra), on which reliance has been placed by learned Senior Counsel for the petitioner, are different from the case in hand and as such is not applicable. Similarly, in 24 Bhupendra Kumar Dash (supra) consideration was made that the District Tender Committee, after having given the report and having approved the tender of the petitioner therein for grant of contract, had become "functus officio", meaning thereby it had no longer power or jurisdiction. Therefore, this Court held that the District Tender Committee could not have recommended the matter one month after having given the report on 23.04.2015 and having approved the tender of the petitioner for grant of contract. The said judgment has been rendered on the basis of the facts of the said case, but the present case is totally different to the extent that the tender committee, having erroneously considered the documents, the case of the petitioner was recommended for approval by the competent authority, but the competent authority instead of approving the same directed for reconsideration, which is well within its jurisdiction. Consequentially, the ratio decided in Bhupendra Kumar Dash (supra) has also no application to the present case.
23. A further argument was advanced before this Court by learned Senior Counsel for the petitioner that, when the petitioner had approached this Court by filing W.P.(C) No.19976 of 2016 for delay in approving the recommendation made by the Chief Engineer, World Bank Projects, Odisha on the basis of the 25 consideration made by the tender committee, and when such matter was pending, the cancellation thereof and consequential issuance of fresh tender on 30.11.2016 cannot sustain. The plea advanced was that the action of the authority is hit by the principle of lis pendence and, as such, is liable to be quashed. To substantiate his claim, reliance has been placed on Homogenomics Private Ltd. (supra). In the instant case, since there is no approval of the recommendation made by the Chief Engineer, World Bank Projects, Odisha, on the basis of assessment of the tender committee, no right has been accrued in favour of the petitioner. Even if the matter was pending before this Court for consideration, the tender committee could reconsider the matter on the basis of the direction given by the competent authority, namely, the approving authority. Thereby, the ratio decided in Homogenomics Private Ltd. (supra) is also not applicable to the present case.
24. Insofar as other judgments are concerned, on which reliance has been placed but not specifically dealt in, in view of the factual matrix of the case in hand and discussion made in the foregoing paragraphs, we are of the considered view that the same are not applicable to the present context and they have been decided on their respective facts.
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25. In view of the aforesaid facts and circumstances, we are of the considered view that, since no right had been accrued in favour of the petitioner and the authorities, having realized their mistakes, have rectified the same, which is well within their jurisdiction, we are not inclined to interfere with the decision so taken. However, since by virtue of the order passed by this Court on 22.12.2016 the petitioner has been permitted to file tender in response to the fresh tender call notice dated 30.11.2016, the same may be considered by the authority on its own merit, on which we do not express any opinion.
26. Thus, we do not find any merits in both the writ petitions, which are hereby dismissed. No order as to cost.
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VINEET SARAN CHIEF JUSTICE ...............................
DR.B.R.SARANGI, JUDGE Orissa High Court, Cuttack The 3rd March, 2017/GDS/Alok 27