Andhra HC (Pre-Telangana)
B.Jaya Babu vs The Regional Managar (Gr) Apsrtc And ... on 9 August, 1995
Equivalent citations: AIR1996AP30, 1995(3)ALT157, AIR 1996 ANDHRA PRADESH 30, (1995) 3 CURCC 427
Author: K.B. Siddappa
Bench: K.B. Siddappa
JUDGMENT
1. This writ appeal by the third respondent in the writ petition is directed against the order dated 20-2-1995 passed in Writ Petition No. 9447 of 1994 by a learned single Judge of this Court, whereby the contract for running the APSRTC canteen at New Bus Stand, Siddipet has been quashed.
2. In pursuance of an advertisement issued on 3-4-1994 by the first and the second respondents herein, as many as 11 persons submitted their tenders for running the APSRTC canteen at New Bus Stand, Siddipet. The writ appellant and the third respondent herein were also amongst them. The tenders were opened on 13-4-1994. Of all the offers received, the offer of the writ appellant to pay a monthly rent of Rs. 33,399.99 p. for running the said APSRTC canteen at New Bus Stand, Siddipet (in short, the "canteen"), was the highest. Second highest offer of Rs.3I,299.99p. made was that of the third respondent herein. The third respondent and perhaps some others were invited for negotiations on 22-4-1994 by the first and the second respondents herein. During the course of these negotiations, the third respondent herein enhanced his offer from Rs. 31,299.99 p. to Rs. 45,999.99 p. According to the writ appellant, he did not participate in the said negotiations dated 22-4-1994 and did not agree to enhance his tender offer of Rs. 33,399.99 p. As the third respondent was a defaulter in respect of APSRTC Bhongir Bus Stand canteen and Bhongir and Yadagiri-gutta sugarcane stalls, the contract for running the said canteen was awarded to the writ appellant by the first and the second respondents herein, which was challenged by the third respondent by filing Writ Petition No. 9447 of 1994 before this Court, The writ petition was allowed by a learned single Judge of this Court by his impugned order dated 20-2-1995 and, therefore, the third respondent in the writ petition has preferred this writ appeal before us.
3. Having heard the learned Counsel for the parties, we are of the view that the learned single Judge has committed an error in quashing the contract awarded to the writ appellant by the first and the second respondents herein. Admittedly the third respondent herein was an existing contractor of the APSRTC canteens and as such he had submitted a "No Due Certificate" dated 12-4-1994 purported to have been issued by the Depot Manager, Yadagirigutta. This "No Due Certificate" was demonstrated to be a false certificate by production of a letter dated 26-4-1994 written by the Depot Manager, Yadagirigutta to the Divisional Manager, Medak Division, Sangareddy in reply to his letter dated 25-4-1994. This letter dated 26-4-1994 of the Depot Manager would show that in respect of one canteen and the two sugarcane stalls, the third respondent herein was not only in arrears of huge amounts of rent and/or licence fee to the tune of Rs. 1,49,364.67 p., but had also dragged the Corporation in several litigations therein detailed. In these circumstances, we are of the view that the offer of the third respondent herein was rightly rejected by the first and the second respondents herein.
4. Clause 11 of the terms and conditions of tender notice specifically provided that "The Corporation reserves the right to reject one or all the tenders received without assigning any reasons therefor or to allow the stall to any person of its choice". The third respondent herein, therefore, cannot claim that his offer during the course of negotiations being the highest, he ought to have been awarded the contract. Similarly for similar reasons and for the further reasons to be stated hereafter, the argument of the learned Counsel for the third respondent herein that the contract if not awarded to the third respondent on the ground that he was a defaulter, ought to have been awarded to a third person, viz. Sri N. Raghavendra Rao, whose offer for Rs. 42,005/- during negotiations was alleged to be the second highest; deserves to be rejected. It is worthy to note that though not a party to the writ petition, Sri N Raghavendra Rao filed his affidavit dated 3-9-1994 in the said petition and deposed: "Now, the Corporation having called for negotiations instead of handing over the contract to the persons i.e. myself, or petitioner but they have given to one Mr. Sri Jaya Babu for only Rs. 33,399.99 incurring huge losses to the Corporation and also contrary to the procedure and acted in a bias manner". No explanation is given why he himself did not file any petition, if he was really interested in the contract. The third respondent herein cannot be allowed to agitate the cause of a third person, who is not before the Court as a party to the petition.
5. Though having knowledge that the contract was awarded to the writ appellant, the third respondent herein did not choose to join him as a party in his writ petition. It was on the basis of his own application for intervention that the writ appellant was joined as the third respondent in the writ petition.
6. In our considered view, the Courts are normally relunctant to interfere in such matters of contract in proceedings under Article 226 of the Constitution. It is only when it is demonstrated that there was an element of arbitrariness, or voilation of equality clause enshrined in Article 14 of the Constitution in the matter of granting any contract that the Courts decide to intervene. In the present case, what we find is that under clause 11 of the tender notice, the Corporation had a right to reject all or any of the tenders. It was not bound to accept the highest offer and in the facts and circumstances of the case, the decision of the Corporation, not to award the contract to the writ petition, i.e., the third respondent herein, cannot be said to be an arbitrary decision. Further, the tender notice in the present case did not contemplate any negotiation after the opening of the tenders. As per the tenders submitted by the various tenderers, the offer of the writ appellant was the highest. Under the circumstances, if the writ appellant did not participate in any such negotiations, and/or if the Corporation overlooked the offers that were received during negotiations, that cannot be made, a ground for quashing the contract awarded to the writ Appellant. All desirous persons similarly situated were allowed to submit tenders and the third respondent herein was also not denied an opportunity to compete and, therefore, there appears no violation of Article 14 of the Constitution.
7. The learned single Judge has also come to the conclusion that the impugned award of contract to the writ appellant was not in the public interest, because by allotment of the vacant stall to him, the Corporation was to suffer loss of income at the rate of Rs. 12,600.00 per month. We are of the view that in every such case of contract, the discretion must be left with the authority that gives the contract to decide what is and what is not in its best interest. In the present case, it would appear from the letter dated 26-4-1994 of the Depot Manager, Yadagirigutta addressed to the Divisional Manager, Medak Division, Sangareddy that the third respondent herein was running the Bhongir canteen without renewal of licence since 1-6-1991 and the Bhongir sugarcane stall without renewal of licence since 1-6-1986. Similarly in respect of Yadagirigutta sugarcane stall, the third respondent herein filed Writ Petition No. 4174 of 1987 instead of vacating the stall in pursuance of notice dated 31-3-1987 by the Corporation. The petition was dismissed on 6-8-1990, but in pursuance of an interim order of the Court, he carried on his business at the said stall between 1-4-1987 to 30-9-1990 without payment of any rent. The arrears still continue to the extent of Rs. 26,169.62 p. including electricity charges. In these circumstances, if the Corporation did not give any credence to the higher offer of the writ petitioner made during negotiations and did not award the contract to him, it cannot be blamed, or said to have sacrificed the interest of the Corporation or that of the public.
8. For the foregoing reasons, this writ appeal succeeds and it is hereby allowed. The impugned order of the learned single Judge of this Court in Writ Petition No. 9447 of 1994 is set aside. As a necessary consequence of this, the writ petition of the third respondent herein stands dismissed with costs. Consolidated counsel fee for this appeal and the writ petition is fixed at Rs. 500/-, payable by the writ petitioner to the contesting appellant (third respondent in the writ petition).
9. Order accordingly.