Madras High Court
R.K.Transport vs The Deputy General Manager (Lpg) on 31 July, 2015
Author: R.Mahadevan
Bench: R.Mahadevan
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED : 31.07.2015
CORAM
THE HONOURABLE MR.JUSTICE R.MAHADEVAN
W.P.(MD)No.2824 of 2015
W.P.(MD)No.2824 of 2015 and M.P.(MD)Nos.1 to 4 of 2015,
W.P.(MD)No.2866 of 2015 and M.P.(MD)Nos.2 to 4 of 2015,
W.P.(MD)No.2867 of 2015 and M.P.(MD)Nos.2 & 3 of 2015,
W.P.(MD)No.3909 of 2015 and M.P.(MD)No.2 of 2015
&
W.P.(MD)No.12040 of 2015 and M.P.(MD)Nos.1 and 2 of 2015
R.K.Transport
rep.by its Working Partner,
R.Shanmuganathan,
having its Head Office at
Duraisamy Rice Mill Campus,
Vellakkal, Manjampatti Post,
Manapparai-621 306,
Manapparai Taluk,
Trichy District. ... Petitioner
Vs.
1.The Deputy General Manager (LPG),
Indian Oil Corporation Limited,
Marketing Division,
Tamil Nadu State Office,
Indian Oil Bhavan,
No.139, Nungambakkam High Road,
Chennai-600 034.
2.The Chief Manager (LPG Operations),
Indian Oil Corporation Limited,
Tamil Nadu State Office (Level 5),
Tamil Nadu State Office,
Indian Oil Bhavan,
No.139, Nungambakkam High Road,
Chennai-600 034. ... Respondents
W.P.(MD)No.2866 of 2015:
1.Thayagam Indane Gas Agency,
rep.by its Proprietrix M.Chitraa,
44, Chilampakkam Main Road,
Kuttalam-609 801.
2.Balu Indane Gas Agency,
rep.by its Proprietor S.Balasubramanian,
227, Pattukottai Main Road,
Adirampattinam,
Thanjavur District-609 113. ... Petitioners
Vs.
1.Union of India represented by its
Secretary to Government of India,
Ministry of Petroleum & Natural Gas,
Government of India, Shastri Bhavan,
Dr.Rajendra Prasad Road,
New Delhi-110 011.
2.The State Level Coordinator,
IOCL, BPCL & HPCL Tamil Nadu & Puducherry (UT),
Indian Oil Corporation Ltd.,
Indian Oil Bhavan,
Nungambakkam, Chennai-600 034.
3.M/s.Indian Oil Corporation Ltd.,
rep.by its Chairman,
3079/3, Sadiq Nagar, JB Tito Marg,
New Delhi-110 049. ... Respondents
W.P.(MD)No.2867 of 2015:
1.Kalyani Gas Agencies,
rep.by its Partner R.Manikandan,
122R, Main Road, Angarai,
Lalgudi, Trichy.
2.Parimala Indane Gas Agency,
rep.by its Proprietrix K.Parimala,
4/138E, Main Road,
Thirumullaivasal-609 113.
3.Meenakshi Indane Gas Agencies,
rep.by its Proprietor Sivasankaran,
13/184, Pattamangalam Street,
Mayiladuthurai-609 001.
4.Mala Indane Gas Agencies,
rep.by its Proprietor A.Langovan,
73, Railady Street, Porayar,
Tharangampady Taluk,
Nagapattinam District.
5.Sri Kala Indane Gas Agency,
rep.by its Proprietor K.Jeyakumar,
1-A, Fund Office Agraharam,
M.K.Moopanar Road,
Near Dhinathanthi Office,
Thanjavur-613 001.
6.Sri Sai Domestic Gas Supplies,
rep.by its Proprietor K.Jayaseelan,
104, Neela South Street,
Nagapattinam.
7.S.M.J.Indane Agencies,
rep.by its Proprietrix J.Selvarani
135, Sethu Road,
Peravoorani-614 804.
8.Sivasakthi Gas Agencies,
rep.by its Proprietor R.Namachivayam,
31/1, Abirami Nagar,
Mayiladuthurai-609 002.
9.Sri Mookambikai Gas Agency,
rep.by its Proprietor R.Venkatesan,
32-A, Kamarajar Salai,
Kaveri Nagar, Kulithalai,
Karur District.
10.Rockfort Gas Agency,
rep.by its Proprietor Capt.R.S.Jagadeesan,
9, Prem Towers, Old Karur Road,
Trichy-2. ... Petitioners
Vs.
1.Union of India represented by its
Secretary to Government of India,
Ministry of Petroleum & Natural Gas,
Government of India, Shastri Bhavan,
Dr.Rajendra Prasad Road,
New Delhi-110 011.
2.The State Level Coordinator,
IOCL, BPCL & HPCL Tamil Nadu & Puducherry (UT),
Indian Oil Corporation Ltd.,
Indian Oil Bhavan,
Nungambakkam, Chennai-600 034.
3.M/s.Indian Oil Corporation Ltd.,
rep.by its Chairman,
3079/3, Sadiq Nagar, JB Tito Marg,
New Delhi-110 049. ... Respondents
W.P.(MD)No.3909 of 2015:
1.T.Krishnamoorthy
2.S.Dinesh ... Petitioners
Vs.
1.The Deputy General Manager (LPG),
Indian Oil Corporation Limited,
Marketing Division,
Tamil Nadu State Office,
IOC Bhawan,
No.134, Nungambakkam High Road,
Chennai-600 034.
2.The Chief Manager (LPG Operations),
Indian Oil Corporation Limited,
Marketing Division,
Tamil Nadu State Office,
IOC Bhawan,
No.134, Nungambakkam High Road,
Chennai-600 034. ... Respondents
W.P.(MD)No.12040 of 2015:
G.Shankar Transport
rep.by its Proprietor,
G.Shankar,
having Office cum Residence at
No.46, Vasanthanagar,
Tharanallur, Trichy-8. ... Petitioner
Vs.
1.The Deputy General Manager (LPG),
Indian Oil Corporation Limited,
Marketing Division,
Tamil Nadu State Office,
Indian Oil Bhavan,
No.139, Nungambakkam High Road,
Chennai-600 034.
2.The Chief Manager (LPG Operations),
Indian Oil Corporation Limited,
Tamil Nadu State Office (Level 5),
Tamil Nadu State Office,
Indian Oil Bhavan,
No.139, Nungambakkam High Road,
Chennai-600 034. ... Respondents
W.P.(MD)No.2824 of 2015 filed under Article 226 of the Constitution of
India praying for issuance of a Writ of Certiorarified Mandamus calling for
the entire records relating to the impugned e-tender notification issued by
the 2nd respondent herein in Tender TNSO/LPG-O/PT-12/TPT/2014-15, published
the same in the Indian Oil e-tendering portal dated 03.02.2015 and
particularly quash the clause No.5.2(ii) of general conditions of the tender
in question as unconstitutional, unreasonable, arbitrary and ab-initio void
in so far as the petitioner is concerned and consequently direct the
respondents herein to invite a fresh e-tender for the Transportation of
Indane cylinders in vertical position on unit rate basis from Ex-Trichy
Bottling Plant, without incorporating the said offending Clause No.5.2(ii) of
General conditions of the tender in question.
W.P.(MD)Nos.2866 and 2867 of 2015 filed under Article 226 of the
Constitution of India praying for issuance of a Writ of Certiorarified
Mandamus calling for the impugned tender Notification of the second
respondent in TNSO/LPG-O/108 for Trichy Bottling Plant dated 04.02.2015 more
particularly Clause 5.2(ii) regarding the calculation of age of the trucks
offered by the tenderers and quash the same and further direct the
respondents herein to give special preference to existing distributors owning
trucks as offered in other Bottling Plants in Tamil Nadu.
W.P.(MD)No.3909 of 2015 filed under Article 226 of the Constitution of
India praying for issuance of a Writ of Mandamus declaring Clause 5.2(ii)
contained in the Notice Inviting Tender bearing Notification No.TNSO/LPG-
O/PT-12/TPT/2014-15 of the second respondent herein, as arbitrary, illegal,
discriminatory and violative of Articles 14 and 19(1)(g) of the Constitution
of India and direct the respondents to process the tender without any
preference on the basis of the date of registration of the vehicles.
W.P.(MD)No.12040 of 2015 filed under Article 226 of the Constitution of
India praying for issuance of a Writ of Certiorarified Mandamus calling for
the entire records relating to the impugned e-tender notification issued by
the first respondent herein in Tender TNSO/LPG-O/PT-12/TPT/2014-15, published
the same in the Indian Oil e-tendering portal dated 04.02.2015 and
particularly quash the clause No.5.2(ii) of general conditions of the tender
in question as unconstitutional, unreasonable, arbitrary and ab-initio void
in so far as the petitioner is concerned and consequently direct the
respondents herein to invite a fresh e-tender for the Transportation of
Indane cylinders in vertical position on unit rate basis from Ex-Trichy
Bottling Plant, without incorporating the said offending Clause No.5.2(ii) of
General conditions of the tender in question.
W.P.(MD)No.2824 of 2015:
!For Petitioner : Mr.P.Sivakumar
For Respondents : Mr.K.Muraleedharan
For Impleading Petitioner : Mrs.Hema Sampath
(M.P(MD)No.4/2015) Senior Counsel for
Mr.S.Sundara Pandian
W.P.(MD)No.2866 of 2015:
For Petitioners : Ms.D.Geetha for
Mr.K.Rajendra Prasad
For Respondents : Mr.K.Asok Kumar Ram,
Central Govt.Standing Counsel
for R1
No appearance for R2
Mr.K.Muraleedharan for R3
For Impleading Petitioner : Mr.A.Thirumurthy
(M.P(MD)No.4/2015)
W.P.(MD)No.2867 of 2015:
For Petitioners : Mr.T.Mohan for
Mr.K.Rajendra Prasad
For Respondents : Mr.K.Asok Kumar Ram,
Central Govt.Standing Counsel
for R1
No appearance for R2
Mr.K.Muraleedharan for R3
W.P.(MD)No.3909 of 2015:
For Petitioners : Mr.AR.L.Sundaresan, Senior Counsel
for Ms.AL.Gandhimathi
For Respondents : Mr.K.Muraleedharan
W.P.(MD)No.12040 of 2015:
For Petitioner : Mr.RM.Loganathan
For Respondents : Mr.K.Muraleedharan
:COMMON ORDER
All the petitioners herein are challenging the e-tender notification issued by the Deputy General Manager of the Indian Oil Corporation, Marketing Division, Indian Oil Bhavan, Chennai, in Tender TNSO/LPG-O/PT-12/TPT/2014-15, published in the Indian Oil e-tendering portal dated 04.02.2015 and praying to quash Clause No.5.2(ii) of the General Conditions of the tender in question as unconstitutional, unreasonable, arbitrary and ab-initio void insofar as the petitioners are concerned.
2. Since the issue involved in these writ petitions is one and the same, all these writ petitions are taken up together and being disposed of by this common order.
PLEADINGS:
3. The petitioner in W.P.(MD)No.2824 of 2015 states that the petitioner's firm is carrying on the business of transportation of LPG Indane Cylinders from Ex-Trichy Bottling Plant for the respondent Corporation. The petitioner's existing contract for transportation of LPG cylinders is continuing and valid till 30.04.2015 as per the work order dated 28.05.2012 and the letter of intent issued by the respondent Corporation. The petitioner has invested huge amount in the vehicle in question, used for the transportation and also for its day-to-day maintenance. The petitioner states that the second respondent, through its website dated 03.02.2015, issued fresh notice inviting tender in Tender No.TNSO/LPG-O/PT-12/TPT/2014-15 for transportation of packed Indane LPG cylinders in vertical position on unit rate basis from Ex-Trichy Bottling Plant. The e-tender consists of credential bid and price bid. Price Bid Meeting was held on 13.02.2015. The submission of the tender document started from 13.02.2015 till 04.03.2015 upto 10.00 hours. The date of commencement of contract was from 01.05.2015, initially for a period of one year and extendable for a further period of two more years. The petitioner further states that e-tender documents must be downloaded from the website and the offer should also be submitted through online only. Pursuant to the tender, the petitioner participated in the Pre- Bid Meeting that was held on 13.02.2015 at Chennai. Immediately, after completion of the meeting, tender documents were made available in the website and the petitioner downloaded the same. On a reading of the tender documents, the petitioner was very much shocked to know that lot of unworkable clauses have been put up. He came to understand that due to Clause No.5.2(ii) of the tender document, the persons like that of the petitioner hailing from rural areas, can be easily thrown out from the contract. The petitioner states that the said clause was not incorporated in the earlier tenders and only in the present tender, it has been introduced. As per the said clause, only for those vehicles which are registered recently and permits obtained recently, will be given priority than the earlier registered vehicles. Even though as per Clause 1.8 of the General Conditions of Contract stipulates that the age of the trucks should not be more than 12 years as on the closing date of the tender in question, the tenderers who are residing in the urban areas and are able to get the vehicles registered immediately and obtain permit immediately, will be benefited. The petitioner submits that the persons like that of the petitioner who are residing in rural areas, will not be able to get the permit issued for the vehicle in a faster pace, since only a break Inspector will be posted in the rural areas, who has no authority to issue permit. When the vehicle is presented for registration in the Unit Office, the permit cannot be obtained immediately since it has to be forwarded to the concerned Regional Transport Office and only thereafter, permit will be transmitted to the rural office. The said process will consume about 3 to 4 working days. According to the petitioner, if similar rates are quoted by more than one tenderer and there is same financial outgo at any particular rank, the tenderer will be considered for further ranking only on the basis of the ascending order of the average age of the trucks quoted by the tenderer in terms of number of days and age of the vehicle based on the date of registration. Because of this undue advantage, even though the applicants are fully qualified as to the credentials, they are likely to be non-suited, by treating their vehicles as older vehicles by a day or two, than the other applicants. Stating so, the writ petition in W.P.(MD)No.2824 of 2015 is filed.
4. The petitioners in the other writ petitions are also placed in the similar footing as that of the writ petitioner in W.P.(MD)No.2824 of 2015.
5. A counter affidavit has been filed on behalf of the respondents in W.P.(MD)No.2824 of 2015, wherein it is stated that the writ petition is not maintainable both on law and facts. It is stated that the writ petitioner is estopped from questioning the terms and conditions of the tender and he has got no locus standi to file this writ petition. It is further stated that there is no illegality in calling for a new tender as the contract already in force is for a maximum period of three years and it is expiring on 30.04.2015. Since the contract is for more than one contractor, there should be evaluation criteria to select the parties and one of the evaluation is as per Clause 5.2(ii)-age of the truck. The tender clause was revised on All India Basis and implemented in all the States of India from the year 2013. Also, in Tamil Nadu, four tenders have been completed for other locations with the similar condition that the truck should be within 12 years model as on the closing date of the tender in question. It is further submitted that the respondents have no role in the activity of the functioning of the Regional Transport Office. The tender conditions are not opposed to any public policy and there is no illegality in the same. The allegation that the clause 5.2(ii) of the tender is unreasonable and unworkable is incorrect, misleading and meaningless and they are factually and legally not sustainable. It is incorrect to state that the said clause is an offending clause, where the response for the tender is overwhelming and competitive. The tender conditions are revised from time to time due to feasibility and other criteria, which are workable to the need of the Corporation and there is no illegality in framing conditions in line with the interest of the Corporation and the public. The security deposit was revised from Rs.30,000/- per truck to Rs.7.5 lakhs per contract, and this clause is applicable all over India. It is submitted that the petitioner cannot maintain the writ petition relating to tender conditions, when the tender is legal and all the terms and conditions and procedures are followed scrupulously. After admitting the terms and conditions, it is not fair on the part of the tenderer to dispute the tender conditions. Thus, it is stated in the counter that there is no merit in the writ petition and the same needs to be dismissed.
6. The above counter filed by the respondent Corporation in W.P.(MD)No.2824 of 2015 is applicable to all the writ petitions, as in all the writ petitions, the same clause i.e., Clause No.5.2(ii) of the tender is under challenge.
CONTENTIONS:
7. Mr.P.Sivakumar, learned Counsel for the petitioner in W.P(MD)No.2824 of 2015, made the following submissions:
7.1. The petitioner is prejudiced by clause No.5.2(ii) of the impugned tender notification, by which, it is mandated that if similar rates are quoted by more than one tenderer and there is same financial out go at any particular rank, the tenderer shall be considered for further ranking on the basis of ascending order of average age of the trucks quoted (owned as well as attached trucks) by the tenderer in terms of number of days.
7.2. However, the above said clause stood contrary to clause 1.8 of the general conditions of contract, wherein it is stated that the age of the trucks should not be more than 12 years as on the closing date and time of the tender in question.
7.3. More so, the petitioner, being hailed from rural area, could not be in a position to obtain the permit immediately, that may take nearly four working days, but the case of the persons residing in urban areas is otherwise.
7.4. Though the date of opening of the tender document was fixed on 04.03.2015, the price bid meeting was held on 13.02.2015, and thereafter only, the tender in question was made available to the petitioner and therefore, he had lost the opportunity to put forth his grievance in the price bid meeting.
7.5. Therefore, he prayed for quashing the impugned clause 5.2(ii) of the e-tendering portal dated 03.02.2015 and for the above relief.
8. Per contra, Mrs.Hema Sampath, learned Senior Counsel appearing for Mr.S.Sundara Pandian, learned Counsel for the impleading petitioner in M.P(MD)No.4 of 2015 in W.P(MD)No.2824 of 2015, made the following submissions:
8.1. Having challenged the impugned e-tender notification, the petitioner had participated in the tender and hence, the present writ petition is not maintainable.
8.2. Because of the order of interim stay granted by this Court, the existing contractors, whose term already got expired as early as on 01.05.2015, have made a huge profit.
8.3. Until the tender is finalised, the trucks concerned could not participate in any other tender.
8.4. The impugned condition imposed in clause 5.2(ii), fixing the lowest average age of the trucks, is only on safety consideration and hence, it cannot be found fault with.
8.5. The bidders are put to heavy loss of income around Rs.50,000/- per month.
8.6. Further, the existing distributors have been given priority than that of L-2 transporters, as per clause 5.5(i)(a) of the standard conditions of the impugned tender notification.
8.7. Placing heavy reliance on the decision of this Court in Vijay Roadlines Prop.S.Thukaram and others v. Indian Oil Corporation, New Delhi - 110 049 and another reported in 2012 (4) TLNJ 308 (Civil), the learned Senior Counsel contended that the scope of interference by this Court in contractual matters is well settled as the action of the respondent Corporation in inviting the tender is purely a contractual affair and prayed for the dismissal of the writ petition.
9. Ms.D.Geetha, learned Counsel appearing for Mr.K.Rajendra Prasad, learned Counsel for the petitioners in W.P(MD)No.2866 of 2015, made the following submissions:
9.1. The distributors who are owning the trucks only for transportation of LPG cylinders could not be treated on par with the other transporters owning trucks for commercial purposes.
9.2. The calculation of age of the trucks as found in clause 5.2(ii) of the impugned tender notification is arbitrary as it has no legal basis to impose such condition.
9.3. If such condition is imposed, the petitioner would be greatly prejudiced, for the reason that the owner of the new truck will get more chances of succeeding in the tender than that of the owner of the old trucks.
9.4. Therefore, she prayed for quashing the said clause 5.2(ii) in the tender notification and for a direction to the second respondent to give preference to the existing distributors owning trucks over the other transporters.
10. Mr.A.Thirumurthy, learned Counsel for the impleading petitioner in M.P(MD)No.4 of 2015 in W.P(MD)No.2866 of 2015, made the following submissions:
10.1. The impleading petitioner participated in the tender process and claimed that she is said to be declared as the successful bidder.
10.2. As per the schedule of the tender, the date of commencement of the contract was 01.05.2015, however, because of the pendency of the present writ petitions, the respondent Corporation was not in a position to confirm the e-auction.
10.3. The impugned clause is only to find out the eligible candidate among the persons quoting similar rates.
10.4. It is only to rectify the ambiguity in regard to the ranking of the tenderers and finalization as well.
10.5. Having participated in the tender process and invested huge amounts in complying with the work order for transportation of the packed LPG cylinders, the impleading petitioner was put to great prejudice and prayed for vacating the interim order already granted by this Court.
10.6. In support of his contentions, he relied on the decision of the Honourable Supreme Court in Shimnit Utsch India (P) Ltd., v. W.B. Transport Infrastructure Development Corporation Ltd., reported in (2010) 6 Supreme Court Cases 303 and the decision of this Court in Misha Power Pvt. Ltd., v. Tamil Nadu Generation and Distribution Corporation Ltd., reported in (2013) 2 MLJ 129.
11. Mr.T.Mohan, learned Counsel appearing for Mr.K.Rajendra Prasad, learned Counsel for the petitioners in W.P(MD)No.2867 of 2015, made the following submissions:
11.1 The respondent Corporation gave preference to the existing distributors owning trucks over the other tenderers, for, it is based on a policy that the distributors who had the dealership for distribution of LPG cylinders to the consumers, have a mandatory obligation to supply cylinders at all time, despite strike of the truck owners.
11.2. Also, the grievance of the petitioner is that the preference given in the earlier tenders was not made available in the present tender process and the petitioner was put to great prejudice by not giving such preference to the existing distributors.
11.3. By the impugned clause 5.2(ii), if the age of the trucks was calculated, then, the preference given to the distributors owning trucks as stated above, would be taken away and the calculation of average age method is arbitrary as it is in violation of Article 14 of the Constitution of India.
11.4. The distributors owning trucks only for the transportation of the LPG Cylinders could not be equated with the other transporters having trucks for commercial purposes.
11.5. The petitioner claimed that there must be a preference to the distributors even in the calculation of average age of the trucks, if not, their interest would be prejudiced.
12. Though no counter affidavit has been filed by the first respondent in W.P(MD)Nos.2866 and 2867 of 2015, Mr.K.Ashok Kumar Ram, learned Central Government Standing Counsel appearing for the Union of India, denied the claim of the petitioners and contended that the scope of interference by the Writ Court in contractual matters is limited and the respondent Corporation is the competent authority to review the policy in regard to the tender process and what the conditions impugned herein, are imposed only in the interest of the general public at large and hence, the relief sought for by the petitioners, is not sustainable in law and prayed for the dismissal of these writ petitions.
13. Mr.AR.L.Sundaresan, learned Senior Counsel appearing for M/s.AL.Gandhimathi, learned Counsel for the petitioners in W.P(MD)No.3909 of 2015, made the following submissions:
13.1. The only grievance of the petitioners is that by virtue of the impugned clause, the persons hailing from rural areas, like the petitioners are put to great loss as there are many difficulties in obtaining the Permits in time.
13.2. Because of the same, the tenderers could not succeed in the tender process and if the contracts are given in proportionate basis, no one would be deprived of his right.
13.3. The respondent Corporation failed to appreciate the fact that when the trucks have been used for transportation of the packed LPG Cylinders, they could not be put to use for other commercial purposes.
13.4. Further, the method of calculation of the average age is arbitrary as it has been invented to pave way for discrimination among the participants.
13.5. By the impugned clause, it is the petitioners, hailing from rural areas, are made to suffer the loss and considering the overall implications, the said clause has to be struck down.
14. Mr.R.M.Loganathan, learned Counsel for the petitioner in W.P(MD)No.12040 of 2015, made the following submissions:
14.1. The only contention that gives rise, is as to whether the respondent Corporation adhered to fair, equal and transparency while imposing the impugned clause in regard to the calculation of the average age of the trucks, that would be succeeded in the tender process and according to the petitioner, the respondent Corporation failed to do so, warranting interference by this Court in the writ proceedings.
14.2. By the impugned clause, the respondent Corporation had made an unequal competition among the equals, which vitiated the entire tender process itself.
14.3. The petitioner would be denied of his right in participating in the tender process and if at all, the said condition is struck down, the rights of the petitioner would be greatly prejudiced, however, the respondent Corporation imposed such condition arbitrarily.
15. No counter affidavit is forthcoming on the side of the respondent Corporation till date, however, Mr.K.Muraleedharan, learned Counsel appearing for the Indian Oil Corporation Limited, in all the writ petitions, made the following submissions:
15.1. First of all, the writ petitions challenging the impugned clause, i.e. Clause 5.2(ii) of the e-tender portal, dated 04.02.2015, are not at all maintainable, for the reason that the scope of interference by the Writ Court in a contractual matter is very limited, as has been held in various decisions of the Honourable Supreme Court.
15.2. Once the petitioners herein had participated in the tender process, it is deemed that they had accepted all the terms and conditions of the tender and when that being so, now, they could not re-agitate the issue at a belated point of time.
15.3. The respondent Corporation called for e-tender for transportation of the LPG Cylinders from the Bottling Plant to the Godowns and this transportation assumes great importance, as the general public are in fond hope that the LPG Cylinders would be delivered at their door-steps without any undue delay.
15.4. The main object of the respondent Corporation is that at no point of time, there should be any undue delay in distributing the LPG Cylinders to the needy customers in time and for that, they have imposed certain conditions to ensure promptness at the time of unexpected events, such as, strike of the owners of the trucks.
15.5. Similarly, the impugned clause has also been imposed only to identify eligible participants in the tender process and the age of the trucks would play a vital role in transportation of the LPG Cylinders and if any untoward incidents that would happen due to the conditions of the trucks, then, it would reflect on the interest of the public at large.
15.6. The respondent Corporation could be able to identify the participants, who are eligible in all criteria, for transportation of the LPG Cylinders.
15.7. The contention of the petitioners that the said clause is arbitrary, could not be countenanced for the reason that the respondent Corporation, being an Government of India Undertaking, cannot shirk its responsibility in ensuring the safety during transportation of such LPG Cylinders.
15.8. He, therefore, prayed for the dismissal of all these writ petitions.
16. I have carefully considered the submissions made on either side and meticulously perused the materials available on record. ANALYSIS:
17. To make it easier, the impugned clause, i.e. Clause 5.2.(ii) of the e-tender portal, dated 04.02.2015, is reproduced hereunder:
"5.2.(ii) In case, similar rates are quoted by more than one tenderer and there is same financial out go at any particular rank, the tenderer shall be considered for further ranking on the basis of ascending order of average age of the trucks quoted (owned as well as attached trucks) by the tenderer in terms of number of days. The age shall be calculated as under:
Date of tender opening Date Month Year Date of original registration of owned & attached Trucks offered Date Month Year Difference Days Months Years Total age in days Days + Month X 30 + Year X 365 Avg age Total age in days of all quoted trucks/No.. of quoted eligibel trucks Remarks In case date of registration is not mentioned in RC book, tenderer has to take the first date of the month in which vehicle is registered. If month is also not mentioned in RC book, tenderer has to take 01st January of that particular year to calculate the average age.
18. From the pleadings, what this Court is able to understand, is that if the age of the trucks is calculated as per the method invented by the respondent Corporation in the impugned clause in Clause 5.2(ii), as above, the petitioners, who are claiming to be hailed from rural areas, would be put to great prejudice as they could not get it registered and obtained the Registration Certificate as well as Permits, as done by the participants from the urban areas, so to say, they can easily get both the Registration Certificate and the Permit on the very same day. According to the petitioners, the delay in obtaining the Permit in each day, assumes great importance as it has heavy impact on their outcome in the tender process during the calculation of the average age of their trucks as per the impugned clause. The only apprehension of the petitioners is that if their tenders are evaluated as per the impugned clause, they may not succeed in the tender process and hence, they challenged it before this Court. Hence, they have come forward with the present writ petitions seeking to quash the said clause stating that it is arbitrary and against Article 14 of the Constitution of India.
19. It is just and proper to recapitulate what had transpired from the date of the issuance of e-tender portal till date, as under:
(i) The e-tender portal came to be issued on 03.02.2015 and 04.02.2015, respectively, as the case may be.
(ii) Price-bid meeting was held on 13.02.2015.
(iii) Date of opening of the Credential Bids was on 04.03.2015.
(iv) The expected date of commencement of the Contract was on 01.05.2015.
(vi) On 03.03.2015, this Court stayed the confirmation of the e-auction alone and thereafter, the same has been extended periodically.
20. Considering the rival submissions in the light of the pleadings made therein and also taking into account the nature of the relief sought for by the petitioners in these writ petitions, this Court finds it apposite to recall the principles enunciated in the decision of this Court in Vijay Roadlines Prop.S.Thukaram and others v. Indian Oil Corporation, New Delhi - 110 049 and another reported in 2012 (4) TLNJ 308 (Civil), wherein, after a deep analysis of the decisions of the Honourable Supreme Court, it is held as under:
"18. The action of the respondents in inviting tender is purely a contractual affair. The scope of interference by the Courts in contractual matters has already been settled by the Honourable Supreme Court in very many decisions.
(a) In (1994) 6 SCC 651 (Tata Cellular v. Union of India) in paragraph 94 the Supreme Court held thus, "(1) The modern trend points to judicial restraint in administrative action.
(2) The court does not sit as a court of appeal but merely reviews the manner in which the decision was made.
(3) The court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible.
(4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts.
(5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides.
(6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure."
(b) In (1999) 1 SCC 492 (Raunaq International Ltd. v. I.V.R.Construction Ltd) the Supreme Court reiterated the said principle and held that the writ Court would not be justified in interfering with the commercial transaction in which the State is one of the parties to the same except where there is substantial public interest involved and in cases where the transaction is mala fide.
(c) In (2000) 2 SCC 617 (Air India Ltd. v. Cochin International Airport Ltd.) the Supreme Court held that the award of contract is essential in commercial transaction, which involves commercial consideration and results in commercial decision. In para 7 it is further held, "7. ........... The State can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. .........."
(d) In (2007) 14 SCC 517 (Jagdish Mandal v. State of Orissa) in paragraph 22 it is held thus, "22. ................... a court before interfering in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions:
(i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone;
OR Whether the process adopted or decision made is so arbitrary and irrational that the court can say: the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached;
(ii) Whether public interest is affected.
If the answers are in the negative, there should be no interference under Article 226."
(e) In AIR 2009 SC 2894 (Meerut Development Authority v. Association of Management Studies) it was held that the tender is an offer. It is something which invites and communicated to the intending tenderers to notify their acceptance. The terms of invitation of tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract.
(f) The decisions cited in (a) to (d) above were followed in the recent decision of the Supreme Court reported in (2012) 6 SCC 464 (Tejas Constructions & Infrastructure (P) Ltd v. Municipal Council, Sendhwa) and dismissed similar challenge by holding that in the absence of any mala fide or arbitrariness in the process of evaluation of bids and determination of the eligibility of the bidders, the Court shall not interfere.
(g) The fixation of different unit price for transportation of petroleum products was challenged as arbitrary before the Orissa High Court in W.P.(C)No.1105 of 2012 order dated 31.7.2012 and the said contention was negatived by holding that the unit price can be fixed depending upon the distance.
(h) The Division Bench of the Allahabad High Court in Civil Miscellaneous Writ Petition No.38215 of 2005 by order dated 10.5.2005 rejected the contention of arbitrariness in reserving tenders in favour of big transporters. It is further held that the Court cannot strike down the terms of the tenders prescribed by the competent authority merely because it feels that earlier term of contract could have served the purpose better or could be more fair. The said decision was rendered in a batch of cases filed by transport companies like the present petitioners challenging the conditions made in the terms and conditions inviting tenders by IOC.
(i) The Division Bench of Punjab & Haryana High Court at Chandigarh in CWP No.21361 of 2011 by order dated 8.8.2012 in the case filed by IOCL upheld the provision enabling the RO Dealers to submit tenders and upheld the similar provision specifying to offer minimum of 5 TTs by following the Division Bench judgment of Delhi High Court.
(j) This Court in 1999 (2) LW 134 (M/s.Jaganathan & Sekar & Others v. M/s.Indian Oil Corporation Ltd.) upheld the exemption of paying EMD given to RO Dealers of LPG cylinders for transportation as the Distributors and retailers are already having sufficient deposits with IOC and therefore there is an excess with the object sought to be achieved.
19. In the light of the above cited decisions, I am unable to find any ground to interfere with the tender conditions impugned in these writ petitions, as none of the conditions are arbitrary, irrational or unreasonable."
21. Keeping in mind the dicta laid down by the Honourable Supreme Court in the above decisions, this Court is of the view that the act of the respondent Corporation in calling for the tenders, is purely a contractual matter and this Court has to examine as to whether the decision making process was free from arbitrariness, not affected by bias or actuated by mala fides and here, the petitioners did not raise such bias or mala fides against the respondent Corporation. When that being the factual scenario, as held by the Honourable Supreme Court while pointing out the limit of judicial review, this Court will examine the decision making process alone and not the decision itself.
22. Also, this Court, in an unreported decision in Sakthi Gas Agency, rep. by its Partner, K.Mahendran and others v. Union of India [W.P.Nos.5229 and 5230 of 2015, decided on 04.03.2015], in similar circumstances, has held thus:
"10. It is to be noted that the tender notification was published on 03.12.2014. Admittedly, the petitioners have downloaded the tender applications and they were well aware of all the conditions contained therein. The petitioners submitted their tender documents before the cut off date namely 05.01.2015. Therefore, it is deemed that the petitioners have accepted the tender conditions as such and have submitted their bids agreeing to the terms specified therein. In such circumstances, it has to be necessarily held that the petitioners are estopped from questioning the tender conditions after having submitted their bids on 05.01.2015, when the Writ Petitions were filed only on 26.02.2015. Hence, the prayer sought for is liable to be rejected on this ground itself.
11. The petitioners would contend that the preferential condition, which was in-existence in the previous tender notification has been dispensed with in the impugned tender and the same is arbitrary and unreasonable.
12. It is settled legal position that though one of the contracting parties is the Government or a Government undertaking organisation that by itself will not make the contract a statutory contract and the impugned tender notification and the works to be allotted are commercial transactions. The Hon'ble Supreme Court while pointing out the limit of judicial review in these matters held that the Court will examine the decision making process and not the decision itself. That the Court will test the matter by applying the Wednesbury principle of reasonableness and to examine as to whether the decision making process was free from arbitrariness, not affected by bias or actuated by malafide. Admittedly, the petitioners have not alleged any bias or malafide on the respondents.
13. The only issue pointed out to state that the decision of the respondent is arbitrary, is by contending that the preferential clause which was existing in the earlier tender notification could not have been deleted in the impugned tender notification. In my view such deletion by itself will not make the impugned tender as being arbitrary, as each tender notification is in individual exercise and the respondent Corporation are the best persons to exercise discretion in the manner in which the tenders have to be invited. Equally settled is the legal principle that the Government must have freedom to contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere [Tata Cellular vs. UOI reported in (1994) 6 SCC 651].
14. Further, it has to be pointed out that the impugned tender notification also provides for certain preferential treatment for their distributors. This is clear from clause No.4.1, by which an Indane Distributor, who has offered a Truck is required to pay lesser EMD and Security Deposit compared to that of a non-distributor tenderer. Similarly clause 5.5(i) also gives its first preference to Indane Distributor in order of their ranking. Thus, it cannot be stated that the distributors have been left in a lurch, but the distinction between Distributor tenderers and other tenderers continuous to be maintained in the impugned tender notification in exercise of the discretion power of the respondent Corporation. It may be true that in the earlier round of litigation both before this Court and the Kerala High Court, the preferential clause in the earlier tender which was put to challenge and the preference was upheld, that by itself cannot be a mitigating factor to state that the respondent cannot review their policy or revise the terms and conditions of tender.
15. As pointed out earlier each tender is an individual contract and a deviation from the past condition by itself cannot render a fresh tender as being arbitrary or unreasonable. In any event, the tenders were opened on 05.01.2015 and Letter of Intents have been issued on 17.02.2015. It is submitted by the learned Senior counsel appearing for the respondent Corporation that the contract has to commence from 01.03.2015 and the present Writ Petitions appear to be a belated attempt by the distributors to set at naught the impugned tender, much after the entire tender process was concluded. Hence, no grounds have been made out to grant the relief sought for."
23. In the firm opinion of this Court, the conditions imposed by the respondent Corporation could not be testified before this Court by filing the writ petitions as it is a contractual obligation between the parties concerned and they have to seek remedy in accordance with law and not by way of the writ proceedings.
24. Admittedly, all the petitioners have participated in the tender process and before confirmation of the same, they have rushed to this Court to get struck down the impugned clause, i.e. Clause 5.2(ii) of the tender portal. It is, no doubt, clear that once the petitioners have participated in the tender, it means that they have accepted the entire tender process as it is and therefore, they are not justified in raising disputes belatedly.
25. Moreover, this Court, while exercising the inherent jurisdiction under Article 226 of the Constitution of India, has to analyse two aspects, i.e. (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, and (ii) Whether public interest is affected. Applying these principles to the case on hand, it is pertinent to point out that the answers to both the questions would be, undoubtedly, in negative, for the following reasons:
(i) Challenge put to the impugned clause could not be portrayed as mala fide or intended to favour someone as several participants had already participated in the tender process and it has to reach the finality only.
(ii) By the impugned clause, at no point of time, the interest of the public would be affected.
FINDINGS:
26. Therefore, the contention of the petitioners that the impugned clause imposed by the respondent Corporation is arbitrary and unreasonable, is liable to be rejected.
27. In the case on hand, the date of commencement of the fresh contract is stated to be on 01.05.2015 and by virtue of the interim order granted by this Court, the respondent Corporation did not confirm the tender process, so to say, it is in the mid-way. Hence, this Court holds that the challenge made to the impugned clause, i.e. Clause 5.2(ii) cannot be gone into by this Court in a writ proceedings and accordingly, it is rejected. Considering the overall circumstances of the issue involved in these writ petitions, this Court finds that because of the litigations pending before this Court, impugning a particular clause in the tender notification, the entire public interest should not be thrown to winds. If the petitioners felt that a particular clause of the tender notification is offending, they could have brought it to the notice of the respondent Corporation at the time of Pre-Bid Meeting held on 13.02.2015, however, having participated in the tender process, now, they cannot raise a plea that the impugned clause is arbitrary.
28. The petitioners herein, are none other than the existing distributors of the LPG Cylinders and on expiry of the lease period, they would cease to transport the same and the successful bidders are, now, awaiting for confirmation of the tender to carry on the business as per the tender. In these circumstances, the interest of the general public looms large in the mind of this Court and pendency of these writ petitions, the transportation of the LPG Cylinders may be affected, which, would ultimately interrupt the supply its customers.
29. For the foregoing reasons, all the writ petitions are disposed of, with the following directions:
(i) The respondent Corporation shall, forthwith, confirm the tender process and proceed further in accordance with law.
(ii) Further, the respondent Corporation is directed to ensure that the tender process is being proceeded with, without compromising on safety, security and quality or sustainable capacity.
(iii) Also, the petitioners are at liberty to work out their remedy, if any, in the manner known to law.
Consequently, the connected miscellaneous petitions are closed. However, there shall be no order as to costs.
To
1.The Deputy General Manager (LPG), Indian Oil Corporation Limited, Marketing Division, Tamil Nadu State Office, Indian Oil Bhavan, No.139, Nungambakkam High Road, Chennai-600 034.
2.The Chief Manager (LPG Operations), Indian Oil Corporation Limited, Tamil Nadu State Office (Level 5), Tamil Nadu State Office, Indian Oil Bhavan, No.139, Nungambakkam High Road, Chennai-600 034.
3.The Secretary to Government, Government of India, Ministry of Petroleum & Natural Gas, Government of India, Shastri Bhavan, Dr.Rajendra Prasad Road, New Delhi-110 011.
4.The State Level Coordinator, IOCL, BPCL & HPCL Tamil Nadu & Puducherry (UT), Indian Oil Corporation Ltd., Indian Oil Bhavan, Nungambakkam, Chennai-600 034.
5.M/s.Indian Oil Corporation Ltd., rep.by its Chairman, 3079/3, Sadiq Nagar, JB Tito Marg, New Delhi-110 049.
.