Kerala High Court
M/S.C.V.Thomas vs The State Of Kerala on 23 March, 2016
Author: P.V.Asha
Bench: P.V.Asha
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE SMT. JUSTICE P.V.ASHA
TUESDAY, THE 11TH DAY OF APRIL 2017/21ST CHAITHRA, 1939
WP(C).No. 18166 of 2016 (U)
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PETITIONER(S) :
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M/S.C.V.THOMAS, CONTRACTORS PRIVATE LIMITED(OPC),
VI/254 A, KOTTISSERIKUDIYIL, KOTHAMANGALAM P.O.,
KERALA - 686 691, REPRESENTED BY THE DIRECTOR,
SABU THOMAS.
BY SRI.G.SHRIKUMAR (SENIOR ADVOCATE)
ADV. SRI.ANIL VINCENT
RESPONDENT(S) :
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1. THE STATE OF KERALA,
REPRESENTED BY THE SECRETARYTO GOVERNMENT,
IRRIGATION DEPARTMENT, GOVERNMENT SECRETARIAT,
THIRUVANANTHAPURAM.
2. THE CHIEF ENGINEER,
IRRIGATION DEPARTMENT,
PROJECT - II, THIRUVANANTHAPURAM.
3. THE SUPERINTENDING ENGINEER,
IRRIGATION DEPARTMENT,
PROJECT CIRCLE, PIRAVOM.
4. M/S.MARY MATHA CONSTRUCTION COMPANY,
MARYMATHA SQUARE, ARAKKUZHA ROAD,
MUVATTUPUZHA - 686 661,
REPRESENTED BY THE POWER OF ATTORNEY HOLDER,
SIBU CHERIAN.
R1 TO R3 BY GOVERNMENT PLEADER SRI. K.V.MANOJKUMAR
R4 BY ADV. SRI.P.SHANES METHAR
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD
ON 24-03-2017, THE COURT ON 11-04-2017 DELIVERED THE FOLLOWING:
Msd.
WP(C).No. 18166 of 2016 (U)
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APPENDIX
PETITIONER(S)' EXHIBITS :
P1 TRUE COPY OF E-PROCUREMENT NOTICE/INVITATIONS FOR
BIDS (IFB).
P2 TRUE COPY OF BID DETAILS.
P3 TRUE COPY OF THE BID SUBMISSION CONFIRMATION.
P4 TRUE COPY OF THE INTIMATION DATED 23.03.2016 FROM
NATIONAL SMALL INDUSTRIES CORPORATION TO
THE 3RD RESPONDENT.
P5 TRUE COPY OF GOVERNMENT PURCHASE ENLISTMENT
CERTIFICATE ISSUED BY THE NATIONAL SMALL INDUSTRIES
CORPORATION LIMITED.
P6 TRUE COPY OF THE BID OPENING SUMMARY.
P7 TRUE COPY OF THE NOTIFICATION AWARDING THE CONTRACT IN
FAVOUR OF THE 4TH RESPONDENT.
P8 TRUE COPY OF THE TENDER SUMMARY REPORTS.
RESPONDENT(S)' EXHIBITS & ANNEXURES :
EXHIBIT R3(A): TRUE COPY OF THE RELEVANT EXTRACT OF
THE TENDER CONDITION.
EXHIBIT R3(B): TRUE COPY OF THE EXTRACT OF OFFICE MEMORANDUM
DATED 20.02.2014.
EXHIBIT R3(C): TRUE COPY OF THE JUDGMENT IN W.P(C).NO. 7201/2015
DATED 02.11.2015.
EXHIBIT R3(D): TRUE COPY OF THE BID SUBMISSION CONFIRMATION.
EXHIBIT R3(E): TRUE COPY OF THE EXTRACT OF CLAUSE 4.5 (A) IF ITB.
EXHIBIT R3(F): TRUE COPY OF THE LETTER DATED 18.04.2016 BY
THE ELECTION COMMISSION OF INDIA.
EXHIBIT R3(G): TRUE COPY OF THE AGREEMENT DATED 18.05.2016.
EXHIBIT R3(H): TRUE COPY OF THE ACKNOWLEDGEMENT FORM OF
HANDING OVER THE SITE TO THE CONTRACTOR.
EXHIBIT R3(I): A TRUE COPY OF THE INVITATION FOR BID (IFB) &
INSTRUCTION OF BIDDERS (ITB).
WP(C).No. 18166 of 2016 (U)
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EXHIBIT R3(J): A TRUE COPY OF BID EVALUATION REPORT.
EXHIBIT R3(K): A TRUE COPY OF QUALIFICATION INFORMATION IN
SCHEDULE B SUBMITTED BY THE PETITIONER ALONG
WITH THEIR BID.
EXHIBIT R3(L): A TRUE COPY OF GOVERNMENT LETTER DATED 15.11.2016.
EXHIBIT R4(A): TRUE COPY OF THE TURNOVER CERTIFICATE AND IT
RETURN VERIFICATION FORM SUBMITTED BY
THE PETITIONER ALONG WITH BID.
ANNEXURE R3(A): PHOTO COPY OF THE BID SUBMISSION CONFIRMATION.
//TRUE COPY//
P.S.TOJUDGE.
Msd.
P.V.ASHA, J.
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W.P(C) No.18166 of 2016-U
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Dated this the 11th day of April, 2017
JUDGMENT
A private limited company engaged in Engineering Constructions Works has filed this writ petition challenging the action of respondents 1 to 3 in rejecting its bid as per Ext.P7 order by which the 4th respondent has been awarded the work, despite the fact that the petitioner was the lowest bidder.
2. The 2nd respondent - the Chief Engineer of Irrigation Department invited electronic tenders for "construction of new bridge for diversion of traffic for safety of old barrage at Bhoothathankettu", as per Ext.P1 notification dated 29.02.2016 under "National Competitive Bidding". The closing time fixed was 16 hours on 30.03.2016, which was later extended till 4 p.m on 15.04.2016. The petitioner submitted its online bid on 14.04.2016 and received confirmation for the same as per Ext.P3. It is submitted that the petitioner is eligible for tender fee exemption as well as EMD exemption as per Exts.P4 and P5 orders. "National small industries Corporation Ltd." had in its letter dated 23.3.2016 addressed to the Superintending W.P(C) No.18166 of 2016-U 2 Engineer of Irrigation Department, informed that the petitioner is a registered unit with them under the Government Stores Purchase Program and as per Government of India's letter F.No.25(2)2011-MA dated 14.10.2011 and the Kerala Government Finance Department's order - G.O(P). No.489/2013/Fin. dated 26.9.2013, the units registered under the Single Point Registration Scheme are eligible to avail the benefit of exemption from payment of earnest money, waiver of security deposit to the monetary limit for which the unit is registered, issue of tender sets free of cost and price preference upto 15% against L1, while participating in the tenders floated by Central/State Government Departments/Public Sector Undertakings and therefore, requested the 3rd respondent to extend those facilities to the petitioner. The petitioner claims that its annual turnover during the year 2011-12 was Rs.243.39 lakhs; in 2012-13 it was Rs.390.37 lakhs, and Rs.229.5 lakhs in 2013-14 with monetary limit of Rs.196 lakhs in Ext.P5 certificate. In Ext.P5 Government purchase Enlistment Certificate dated 30.12.2015, it was certified that the petitioner's name has been regisered as a SSI unit eligible for participation in the Central Government Store Purchase Program as per the Single Point W.P(C) No.18166 of 2016-U 3 Registration Scheme for the items listed therein, which included construction of bridges, roads and buildings. The petitioner submits that the certificate Ext.P4 was uploaded and it was thereafter Ext.P3 receipt was released confirming the bid of the petitioner. Thereafter when the bid opening was conducted on 22.04.2016, the petitioner's bid was rejected on the ground of non submission of bid security and immediately thereafter Ext.P7 notification awarding contract to the 4th respondent was uploaded after executing agreement with the 4th respondent on 18.05.2016 despite the fact that at the relevant time there was a ban for awarding works from the Election Commissioner. The petitioner submits that Ext.P6 bid opening summary would show that the exemption claimed by the petitioner was never objected and therefore, the rejection of its bid for nonsubmission of bid security without considering Ext.P4 intimation or Ext.P5 certificate was illegal and vitiated by mala fides. The petitioner further submits that even though the agreement was executed on 18.05.2016, the tender submission reports were uploaded by the 2nd respondent only on 21.5.2016 which also would show the foul play behind the awarding of work to the 4th respondent. The petitioner had quoted a sum of Rs.16,82,53,505/-; whereas the W.P(C) No.18166 of 2016-U 4 4th respondent had quoted a sum of Rs.17,67,50,362/-, i.e there was a difference of Rs.84,96,821/-. The writ petition was filed in the above circumstances challenging Exts.P7 notification and P8 report and for a direction to the respondents to award work in favour of the petitioner.
3. Respondents 1 to 3 have filed a statement, counter affidavit and additional counter affidavit. In the counter affidavit it is stated that the bid opening of the work was conducted on 22.4.2016 at 11.30, and it was found that there were 7 valid bids including that of the petitioner. The lowest bidder M/s.T.T.Sunny & KSCC (joint venture) was not found eligible to participate in the bid. The petitioner was the second lowest bidder but the petitioner had not remitted the tender fee and required bid security as stipulated in clause 16 of the tender conditions. As per clause 16(1) the bidder shall furnish, as part of his bid, a bid security on the amount as specified in IFB (Instructions for bidders) for this particular work through on-line NEFT transaction. Under clause 16(2), any bid which is not accompanied by an acceptable bid security and not secured under sub clause 16(1) shall be rejected by the employer as non- responsive. Clauses 16.1 and 16.2 of Ext.R3(a) tender conditions W.P(C) No.18166 of 2016-U 5 read as follows:
"Clause 16(1) : The bidder shall furnish, as part of his Bid, a Bid security in the amount as specified in IFB for this particular work through ONLINE NEFT TRANSACTION. The online payment of bid security and bid submission fee should be made sufficiently early such that at the specified date and time of the opening of the bid the status of payment should be successful, No "subject to Bank Clearance" status will be entertained.
Clause 16(2): Any bid not accompanied by an acceptable Bid Security and not secured as indicated in Sub-Clauses 16.1 above shall be rejected by the Employer as non-responsive. The bid security of a joint venture must define as `bidder' all joint venture partners and list them in the following manner: a joint venture consisting of "........", ".........", and "...........".
4. In answer to the claim of the petitioner for exemption it is stated that the petitioner's claim for exemption was under
Micro Small and Minimum Enterprises (MSME), producing Exts.P4 and P5 certificates. The work for which the tenders were invited was one coming under Dam Rehabilitation and Improvement Project (DRIP). For tenders invited by national competitive bidding for world bank aided works, no exemption of tender fee/bid security can be permitted to any bidder or any class of bidders and there is no clause in the e-published bid document permitting tender fee/bid security exemption for any bidder. As the present work is not covered under the Micro Small and Medium Enterprises (MSME) procurement Policy, the petitioner is not entitled to avail the benefits of exemption. The respondents produced Ext.R3(b) office memorandum dated W.P(C) No.18166 of 2016-U 6 20.02.2014 relating to public procurement policies which contains answers to the frequently asked questions in respect of public procurement policy, which would show that the policy is meant for procurement of annual goods produced by MSME not applicable to work contract. Question No.18 in Ext.R3(b) and its answer reads as follows:
"Q.No.18: Whether this policy is applicable for works/trading activities also?
Answer: Policy is meant for procurement of only goods produced and services rendered by MSEs."
5. The respondents also relied on the judgment of the Delhi High Court in W.P(c).No.7201 of 2015 in which the work awarded granting exemption on the basis of MSME as claimed by petitioner was found illegal holding that the public procurement policy for MSME does not cover works contract, relying on question No.18 and 19 of Ext.R3(b). In that case it was found that no preference could have been given to the person who was awarded works on the basis of services from MSME. The respondents have produced the bid submission confirmation issued in favour of another person saying that it has remitted tender fee and bid security, despite the fact that it was also registered under MSME. The further contention raised is W.P(C) No.18166 of 2016-U 7 that the petitioner does not fulfill the basic eligibility criteria provided in clause 4.5A(a) of ITB (Instructions to Bidders), according to which, the minimum annual financial turnover of the bidder shall be Rs.12.9 crores in any of the past 5 years. Ext.R3(e) contains clause 4.5A, which reads as follows:
"4.5 A: To qualify for award of the contract, each bidder in its name should have in the last five years : 2014-15, 2013-14, 2012-13, 2011-12 and 2010-11
(a) achieved, in at least one financial years, a minimum annual financial turnover (in all classes of civil engineering construction works only) of INR 129 million @ 2014-15 price level.
(b) satisfactorily completed (not less than 90% of contract value), as a prime contractor, (or as subcontractor duly certified by the employer/main contractor) at least one similar work** of value not less than INR 97 million @ 2014-15 price level.
Therefore, it is submitted that eventhough the fact that the petitioner was the second lowest bidder, his bid was rejected on the ground of (1) non submission of bid security and tender fee as provuded in clause 16.2 (Ext.R3(a)) of ITB (2) not having required bid capacity in accordance with Section 4 of ITB and (3) not having minimum annual financial turnover under clause 4.5A
(a) - Ext.R3(e). In answer to the contention of the petitioner that work was awarded and agreement was executed despite the ban order of the election commission, it is stated that the election W.P(C) No.18166 of 2016-U 8 commission had granted permission as per Ext.R3(f) letter dated 18.4.2016 for awarding works for tenders already floated coming under DRIP, on the basis of intervention of Special Secretary, Government of India, MOWR River Development and Ganga Rejuvenation and that the bid opening summary could be uploaded only on 21.5.2016 on account of certain technical problems relating to the internet connectivity. It is the further case of the respondents that the privilege of claiming tender fee/EMD exemption has been allowed as per the default settings in the e- procurement website and acceptance of the same would be done by the tender inviting authority only on eligibility basis. According to the respondents, the 4th respondent already started the work immediately on execution of the agreement on 18.5.2016 based on which the site was handed over to him as per Ext.R3(h) on 23.5.2016.
6. In the additional counter affidavit filed by the 3rd respondent, the respondents have explained the process of selection producing Ext.R3(i) procurement notice/invitation for bids (IFB) National Competitive Bidding of the DRIP issued on 29.2.2016, which is the full text of Ext.P1, stating that there are 3 stages in the process of selecting bidders as per IFB and ITB. W.P(C) No.18166 of 2016-U 9 Process of bid opening is explained in clause 23 of ITB, which contains clauses 23.1 to 23.4 which read as follows:
"23.1: The Employer inviting bids or its authorized representative will open the bids online (except those whose original documentsd were not received upto specified time) and this could be viewed by the bidders also onlone in the presence of the bidders or their authorized representatives who wish to be present on the date and time specified in the IFB and venue specified in Clause 20. The bids will be opened as per the procedures mentioned in the guidelines vide 2.45. In the event of the specified date for the opening of bids being declared a holiday for the Employer, the bids will be opened at the appointed time on the next working day.
23.2 In all cases, the amount of bid security, cost of bid documents, and validity of the bid shall be scrutinized. Thereafter, the bidders' name and such other details as the Employer may consider appropriate, will be notified as Part I bid opening summary by the authority inviting bids at the online opening. A separate electronic summary of the opening is generated and kept online.
23.3 The Bidder's names, the bid prices, the total amount of each Bid and of any alternative Bid (if alternatives have been requested or permitted), any discounts, Bid modifications and withdrawals, the presence or absence of Bid security, and such other details as the employer may consider appropriate, will be recorded as bid opening summary and uploaded by the Employer on the portal. No bid shall be rejected at bid opening (except those whose original documents were not received upto specified time and the bids of the bidders who had withdrawn online upto the specified time). Any bid price, which is not declared and recorded, will not be taken into account in Bid Evaluation.
23.4: The Emplohyer will also prepare minutes of the Bid opening, including the information disclosed in accordance with Clause 23.3 of ITB and uplopad the same for viewing online."
Therefore, under clause 23.3, any discounting bid modification and withdrawal, presence or absence of bid security and such other details as the employer may consider appropriate, will be W.P(C) No.18166 of 2016-U 10 recorded as bid opening summary and uploaded by the employer on the portal. No bid shall be rejected at bid opening and any bid price which is not declared and recorded will not be taken into account in bid evaluation. That is, only those bids which are not attended with original documents within the specified time and remains not withdrawn online upto that time sould be rejected summarily. The examination of bids and determination of responsiveness are decided under clause 26 which read as follows:
"26. Examination of Bids and Determination of Responsiveness 26.1 Prior to the detailed evaluation of Bids, the Employer will determine whether each Bid (a) meets the eligibility criteria defined in Clause 3; (b) has been properly signed; (c) is accompanied by the required securities and; (d) is substantially responsive to the requirements of the Bidding documents.
26.2 A substantially responsive Bid is one which conforms to all the terms, conditions, and specifications of the Bidding documents, without material deviation or reservation. A material deviation or reseryation is one (a) which affects in any substantial way the scope, quality, or performance of the Works; (b) which limits in any substantial way, inconsistent with the Bidding documents, the Employer's rights or the Bidder's obligations under the Contract; or (c) whose rectification would affect unfairly the competitive position of other Bidders presenting substantially responsive Bids.
26.3 If a Bid is not substantially responsive, it will be rejected by the Employer, and may not subsequently be made responsive by correction or withdrawal of the non - conforming deviation or reservation."
Clause 26.1 provides that the employer has to determine W.P(C) No.18166 of 2016-U 11 whether the bidder fulfills the eligibility criteria as provided therein under clause 26.3, the bid which is not substantially responsive would be rejected by the employer and there cannot be any correction or withdrawal. The process of evaluation and comparison are the next stages which are provided under clause 29 which reads as follows:
"29. Evaluation and Comparison of Bids 29.1 The Employer will evaluate and compare only the Bids determined to be substantially responsive in accordance with Clause
26. 29.2 In evaluating the Bids, the Employer will determine for each Bid the evaluated Bid Price by adjusting the Bid Price making appropriate adjustments for any other acceptable variations, deviations 29.3 The Employer reserves the right to accept or reject any variation, deviation, or alternative offer. Variations, deviations, and alternative offers and other factors w'hich are in excess of the requirements of the Bidding documents or otherwise result in unsolicited benefits for the Employer shall not be taken into account in Bid evaluation.
29.4 The estimated effect of the price adjustment conditions under Clause 47 of the Conditions of Contract, during the period of implementation of the Contract, will not be taken into account in Bid evaluation.
29.5 If the Bid of the successful Bidder is seriously unbalanced in relation to the Engineer's estimate of the cost of work to be performed under the contract, the Employer may require the Bidder to produce detailed price analysis for any or all items of the Bill of Quantities, to demonstrate the internal consistency of those prices with the construction methods and schedule proposed. After evaluation of the price analysis, the Employer may require that the amount of the performance security set forth in Clause 34 be increased at the expense of the successful Bidder to a level sufficient to protect the Employer against financial loss in the event of default of the successful Bidder under the Contract."
Therefore, under clause 26 the employer has to determine W.P(C) No.18166 of 2016-U 12 whether the bid has been properly signed, accompanied by required security and whether it is substantially responsive to the requirement of the bidding documents. According to the respondents, the 3rd respondent has followed the procedure prescribed in clause 23 and 26 for bid opening, and evaluation of the bid opening summary was prepared in accordance with clause 23 of ITB after preliminary examination, in which it was found that the petitioner's bid was not accompanied by the required bid security. Ext.R3(j) evaluation report was prepared thereafter considering the cases of the 7 bidders when it was found that the petitioner failed to meet the basic eligibility requirement under clause 4.5A(a) for not having the financial turnover of 12.9 crores in any of the past 5 years and it failed to qualify clause 4.7 of ITB, according to which, the bid capacity of the firm was calculated. The bid capacity is calculated in accordance with Ext.R3(k) given in Schedule B, which is calculated on the basis of the total valuation of civil engineering construction work executed and payments received in the last 5 years. The maximum payment received during the past 5 years came to only 6.75 crores. The respondents have produced Ext.R3(l) letter dated 15.11.2016 of the Government addressed W.P(C) No.18166 of 2016-U 13 to the Chief Engineer informing that exemption of EMD/Tender fee/security deposit and price preferences allowed to MSME bidders as per Government order dated 7.11.2013 is not applicable to major/minor construction work tenders floated by PWD/Irrigation Departments. It is therefore stated that the awarding of work to the 4th respondent was in accordance with law.
7. In the counter affidavit filed by the 4th respondent he has produced annual turnover certificate as Ext.R4(A) stating that he fulfills all the tender conditions and was awarded the work on being the succesful bidder who quoted the lowest bid amount. Accoridng to him, clause 5 of Ext.P1 notice inviting tender provided that bid would be conducted in accordance with the proceedings specified in the world bank guidelines and only eligible bidders with the key qualification provided therein shall participate in the bidding. In order to qualify for award of the contract each bidder should have attained a minimum annual financial turnover (in cases of civil engineering construction works of INR 129 million @ 2014-15 price level, satisfactorily completed not less than 90% of the contract valuation as a prime contractor or as a sub contractor duly certified by the W.P(C) No.18166 of 2016-U 14 employer/main contractor of not less than INR 97 million of civil @ 2014-15 price level. It was also provided that the financial turnover and cost of completed works of previous years shall be given weightage of 5% per year based on rupee value to bring them to 2014-15 price level. Producing Ext.R4(A) the 4th respondent claimed he was fully qualified in terms of the guidelines as given in clause 5. It is stated that the annual turnover of the petitioner was only 229.5 lakhs in 2013-14 and 7.44 crores in 2014-15 as seen from Ext.P5. He also states that the certificates produced from the Chartered Accountant and Government purchases enlistment certificate from NSIC were contradicatory. According to him, the biddding was conducted in accordance with the procedure specified in the world bank guidelines. According to which there shall not be any sort of exemption to the bidders and the bidders are required to furnish security as provided in clause 6 of the tender notice and the petitioner's bid was rejected as non responsive. The 4th respondent alleges fraud having committed by the petitioner by submitting false certificates. Apart from that it is stated that the petitioner was not a qualified bidder and it did not possess sufficient financial capacity to carry out the work tendered. W.P(C) No.18166 of 2016-U 15
8. Heard Sri G.Sreekumar, the learned Senior Counsel appearing for the petitioner, Sri K.V.Manoj Kumar Special Government Pleader and Sri Shine Mathew, learned counsel appearing for the 4th respondent.
9. The main contention of the petitioner raised in the writ petition is that the respondents who accepted and acknowledged the bid submitted by the petitioner as per Ext.P3 cannot later turn round and disqualify the petitioner on the ground that the petitioner did not remit the bid security. The petitioner has got a case that in case there was no acknowledgment confirming its bid submission as per Ext.P3 the petitioner would have remitted the bid security and could have particiapted as a valid tenderer. After having acknowledged and confirmed its bid exempting it from submission of bid security, which the petitioner claimed by uploading the certificate and letter Exts.P4 and P5, rejection of it thereafter was only for favouring the 4th respondent. Further contentions are on the basis of the haste shown in the matter when the ban of Election Commissioner was in force.
10. The question to be examined is whether the uploading of certificate and Ext.P3 confirmation alone will show that the W.P(C) No.18166 of 2016-U 16 petitioner satisfied all the conditions for entering a bid and whether the bid submitted by the petitioner could have been rejected subsequently. Ext.P1 invitation of tender, full text of which is produced as Ext.R3(i), would show the conditions prescribed for submission of bid. The provisions contained in ITB clause 5 of Ext P1/Ext.R3(i) provides that bidding would be conducted through the National Competitive Bidding procedures specified in the world bank's guidelines and that only the eligible bidders having the given qualification shall participate in the bid. The qualifications prescribed clause 5 reads as follows:
"5. Bidding will be conducted through the National Competitive Bidding procedures specified in the World Bank's Guidelines, and is open to all bidders as defined in the Guidelines. Only eligible bidders with following key qualifications shall participate in this bidding. To qualify for award of the contract, each bidder in its name should have in the last five years : 2014-15, 2013-14, 2012-13, 2011-12 and 2010-11
(a) achieved, in at least one financial year, a minimum annual financial turnover (in all classes of civil engineering construction works only) of INR 129 million @ 2014-15 price level.
(b) satisfactorily completed (not less than 90% of contract value), as a prime contractor, (or as subcontractor duly certified by the employer/main contractor) at least one similar work of value not less than INR 97 million of Civil @ 2014-15 price level.
Clause 6 provides that bidders shall furnish as part of bid, bid submission fee and bid security for the amount as specified therein through online NEFT transaction and that any bid not accompanied by an acceptable bid security and not secured as W.P(C) No.18166 of 2016-U 17 indicated in clause 16.1 of ITB shall be rejected as non responsive. The procedure for bid submission are provided in clause 16, 23 and 29 which are already extracted. While clause 16 provides for furnishing of bid security sufficiently early and clause 16.2 provides that bid not accompanied by acceptable bid security would be rejected as non responsive and the bids would be opened as provided in clause 23. The petitioner cannot claim that only because the confirmation was received as per Ext.P3 its bid was not liable to be rejected when the other conditions are not satisfied.
11. As per clause 23.3 no bid shall be rejected at bid opening; at the same time the employer can record and upload the bid's opening summary along with bidder's name, bid price, discount, modification, withdrawal, presence or absence of bid security etc. and upload the same in the bid opening summary. The determination of responsiveness is only at the subsequent stage. The rejection of the petitioner's bid was made at that stage only. The respondents have stated that the default settings in the e procurement website allows the privilege of claiming tender fee/EMD expenditure of participation and acceptance of that is done only thereafter on eligibility basis. Therefore, what W.P(C) No.18166 of 2016-U 18 is to be looked into is whether the petitioner was eligible under the terms and conditions provided.
12. Even though the petitioner has filed a reply affidavit, the petitioner only claims the exemption on the basis of Exts.P4 and P5. Nothing is stated regarding the fulfilment of conditions prescribed in Clause 5 of Ext P1. According to him that was not the ground on which his bid was rejected. As provided in Ext.R3
(b), which is upheld in Ext.R3(e) judgment, the exemption claimed by the petitioner is not applicable to work contracts. Apart from that the petitioner is not eligible under clause 5 of Ext.P1. Ext.R3(j) would show that the pretitioner does not fulfill the bid capacity for not having required annual financial turnover. These are clear from Ext.R3(j) evaluation report. Claim of the petitioner on the basis of MSME cannot be accepted in the light of Ext.R3(b) which provides that there cannot be any exemption of bid security in respect of tenders invited by national competitive bid for world bank in respect of works contract. In the evaluation report Ext.R3(j), the respondents have stated that, even though the letter produced by the petitioner from NSIC to the effect that it is eligible for exemption from remitting bid security, tender fees and relaxation in W.P(C) No.18166 of 2016-U 19 security deposit for tenders floated by Central/State Govt./PSU, the relaxations can only be availed in the case of store purchase tenders and not for civil work tenders. It was also found that no exemption of bid security or security deposit can be permitted to any bidder or class of bidders for tenders invited by national competitive bidding and this has been specified in clause 16.2 of ITB, which reads as follows:
"Clause 16(2): Any bid not accompanied by an acceptable Bid Security and not secured as indicated in Sub-Clauses 16.1 above shall be rejected by the Employer as non-responsive. The bid security of a joint venture must define as `bidder' all joint venture partners and list them in the following manner: a joint venture consisting of "........", ".........", and "...........".
There is no provision in Ext.P1/Ext.R3(i) which provides for exemption from bid security. Therefore, just because the petitioner received a confirmation as per Ext.P3 it cannot claim that the work should have been awarded in its favour since it was the second lowest bidder or that there was a difference of 85 lakhs in the amount quoted. Even assuming that the contention raised by the petitioner that it was eligible for exemption from remitting the security can be accepted, it would not have been eligible on the basis of the requirement of annual turnover and in the absence of sufficient bid capacity which is also one of the conditions to be looked into. Further it is also stated that the W.P(C) No.18166 of 2016-U 20 work commenced as early as in May, 2016 itself. In the above circumstance petitioner has not made out a case for interference of this court under Article 226 of the Constitution of India in awarding the work to 4th respondent, that too at a time when the work has already commenced even before filing the writ petition and progressed considerably thereafter.
13. It is seen that Ext.P1 notice was issued on 29.2.2016 fixing the last date as 30.03.2016, which was later extended till 15.4.2016. From the pleadings it is seen that the date of bid opening was on 22.4.2016. Evaluation report was finalised on 29.4.2016 and the Chief Engineer approved evaluation report on 6.5.2016 and issued a letter of acceptance on 9.5.2016. The 4th respondent submitted bank guarantee and security deposit on 11.5.2016 and agreement was executed on 18.5.2016 and site was handed over on 26.8.2016. The petitioner's contention was that the execution of the agreement on 18.5.2016 was made with undue haste contravening the ban order issued by the election commission. Ext.R3(f) letter issued by the Election Commission would show that the execution of agreement was with the permission of the election commission. The further contention that the agreement executed on 18.5.2016 was uploaded only on W.P(C) No.18166 of 2016-U 21 24.5.2016 is also explained by the respondents saying that there occurred some technical problems relating to internet connectivity. Therefore, the contention raised by the petitioner at the time of filing the writ petition regarding undue haste and fraud committed etc. are baseless.
14. The learned Government Pleader relied on the decisions of the Apex Court in Tata Cellular v. Union of India [(1994) 6 SCC 651] and Elektron Lighting Systems (P) Ltd. v. Shah Investments Financial Developments & Consultants (P) Ltd.[(2015) 15 SCC 137], wherein the Apex Court has reiterated the position that the interference under Article 226 in the matter of awarding of contract shall be limited. It is held therein that court does not have expertise to correct the administrative decision ; invitation to the tender is in the realm of contract and such decisions are made qualitatively by experts. Par.94 of Tata Cellular v. Union of India held as follows:
"94. The principles deducible from the above are:
(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 reivew of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible.W.P(C) No.18166 of 2016-U 22
(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 Ihe 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.
Based on these principles we wiii examine the facts of this case since they commend to us as the correct principles."
This has been reiterated in Elektron Lighting Systems (P) Ltd. v. Shah Investments Financial Developments & Consultants (P) Ltd. (supra) in para.12.
In the above circumstances, I do not find any circumstance to interfere with Ext.P7 or Ext.P8. The writ petition therefore fails and is accordingly dismissed.
Sd/-
(P.V.ASHA, JUDGE) rtr/