Calcutta High Court (Appellete Side)
R-Mc Power Recovery (India) Pvt. Ltd. & ... vs Union Of India & Ors on 27 March, 2019
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W.P. No. 7093(W) of 2018
IN THE HIGH COURT AT CALCUTTA
Constitutional Writ Jurisdiction
Appellate Side
R-MC Power Recovery (India) Pvt. Ltd. & Anr.
Vs.
Union of India & Ors.
For the Petitioners : Mr. Jishnu Saha, Sr. Advocate
Mr. Anuj Singh, Advocate
Mr. E. Huda, Advocate
Mr. Avishek Das, Advocate
Mr. Ritoban Sarkar, Advocate
Mr. A.K. Singh, Advocate
For the Union of India : Mr. Kausik Chanda, Ld. A.S.G.
Mr. Anirban Mitra, Advocate
Mr. Indrajit Dasgupta, Advocate
Hearing concluded on : March 20, 2019
Judgment on : March 27, 2019
DEBANGSU BASAK, J.:-
The petitioners have sought a direction upon the respondents to
allow the first petitioner to participate in the bid in respect of tender for 2 supply of non-arsenal (NARS) Spares for Jaguar aircraft being (RFP) No. AIRHQ/CPF/243/AHQ/JAGUAR/W1725041 dated March 12, 2018.
Learned senior advocate appearing for the petitioners has submitted that, the first petitioner is engaged in the business of providing repair and maintenance services, ground support equipment and also in supply of spares and consumables to the air force. The first petitioner is registered with the Hindustan Aeronautics Limited. He has referred to the various registrations of various categories that the first petitioner has with Hindustan Aeronautics Limited. He has submitted that, the first petitioner is registered with the Naval Aircraft Yard, Kochi. He has also referred to the list of supplies made by the first petitioner to various defence organisations appearing at page 48 of the affidavit in reply. He has drawn the attention of the Court to the vendor login issued by Indian Air Force in favour of the first petitioner. He has submitted that, the first petitioner had applied for registration with the Director General of Aeronautical Quality Assurance on March 27, 2017. The making of such an application and the decision thereon is governed by 3 the Standard Operating Procedure. Clause 23 of the Standard Operating Procedure requires the authorities to decide on the application within 90 days. The authorities did not decide on such registration. The petitioners had issued two reminders to the authorities. Even thereafter, the authorities did not decide on the application for registration. Referring to the letter dated January 6, 2018 issued by the authorities, learned senior advocate appearing for the petitioners has submitted that, the authorities claim that, the application for registration is under further deliberation. In effect, the authorities have not decided on the same. He has referred to page 50 of the writ petitioner and submitted that, the first petitioner has a certificate issued by the foreign manufacturer. He has referred to the orders passed by the High Court at Delhi as also the order of the Division Bench of this Hon'ble Court with regard to the petitioners being allowed to participate in similar tender processes. He has submitted that, the petitioners have always quoted less than the rates quoted by the other participants in the tender processes and that, the rate quoted by the petitioners is about 38% less than the last quoted 4 rate of other participants. However, despite the Division Bench allowing the petitioners to participate in such tender process, and despite the petitioner quoting a rate which is less than 38% of the last rate quoted by other participants, no work order has been issued in favour of the petitioners, in respect of such tender process.
Learned senior advocate appearing for the petitioners has referred to the Request for Proposal dated March 12, 2018 issued by the Directorate of Procurement Foreign Purchase wing of the Air force and submitted that, the petitioners are capable of supplying the goods listed in Appendix A of the Request for Proposal dated March 12, 2018. He has referred to the General Informations contained in Part I of the Request for Proposal and submitted that, the Request for Proposal requires participants to submit the bids online. It requires a participant to disclose amongst other things, an Agency Agreement with Foreign Manufacturer/ Original Equipment Manufacturer (OEM) for specific product. It also requires a participant to upload the Permanent Account Number, CST/VAT/TIN/Registration. He has submitted that, the 5 Request for Proposal makes Defence Procurement Manual, 2009 applicable to the tender process. He has referred to clause 1.5.2 of the Defence Procurement Manual, 2009. Under such clause, internal orders and instructions, including Standard Operating Procedures issued by various wings of the Ministry of Defence and the Services have been deemed to be modified by the provisions of the Defence Procurement Manual, 2009 to the extent the former are not in conformity with such manual. Referring to clause 3.2.5 of the Defence Procurement manual, 2009, learned Senior Advocate appearing for the petitioners has submitted that, a firm registered with any department of the Ministry of Defence, the Services or Ordinance Factory Board or the Inter-services organisations, may be considered as a registered firm for procurement of other departments of the Ministry or the other services, for the same range of products/goods/services for which the firm is registered with any of the such organisations. According to him, the first petitioner being registered with the Hindustan Aeronautics Limited and the Naval base, the first petitioner has the right to participate in the tender 6 process. He has referred to the Request for Proposal and submitted that, the same is for a Limited Tender Enquiry. The Defence Purchase Manual, 2009 has dealt with Limited Tender Enquiry at clause 4.3 thereof. He has referred to Chapter 9 of the Defence Procurement Manual, 2009 and submitted that, the procurement of goods and services from foreign countries has been dealt with in such Chapter. Clause 9.3 of the Defence Procurement Manual, 2009 deals with registration of foreign Original Equipment Manufacturer and Vendors. According to him, such clause does not disqualify the first petitioner from participating in the tender process. He has submitted that, the petitioners should be allowed to participate in the tender process. The petitioners having participated in the tender process, in terms of the interim order passed by the Court, the bid of the petitioners be evaluated, in accordance with law.
Learned Additional Solicitor General appearing for the respondents has submitted that, the present writ petition is being finally heard. The earlier orders of the Division Bench of this Hon'ble Court as also the 7 Hon'ble Delhi High Court were interim orders. Such writ petitions have not been finally decided. Such interim orders should have no bearing upon the final decision that may be arrived at on the conclusion of the hearing of the present writ petition. Therefore, according to him, those orders should not be construed as a binding precedent upon this Court. He has submitted that, a participant in the tender process must have a valid registration. Defence Procurement Manual, 2009 no doubt is attracted to the tender process. The tender is in respect of procurement of goods from foreign countries. Such a procurement process is governed by Chapter 9 of the Defence Procurement Manual, 2009. Clause 9.3 of the Defence Procurement Manual, 2009 requires registration of foreign or original equipment manufacturer and vendors. He has referred to Clause 9.3.1 of the Defence Procurement Manual, 2009 and submitted that, for the present moment, foreign or original equipment manufacturers and vendors are being registered by the Service Headquarters and Headquarters of other Departments. Till such time common guidelines are formulated, the Registering Authorities would 8 continue to register only the foreign original equipment manufacturers and vendors as per the existing procedure followed by them. The authorities are yet to formulate the common guidelines for registering any other person other than foreign original equipment manufacturer and vendors. Therefore, the authorities are not in a petition to register any Indian manufacturer or vendor. The first petitioner being an Indian vendor, cannot be granted a registration. Therefore, the first petitioner cannot be allowed to participate in the subject tender process. He has relied upon the affidavit in opposition of the respondents in details in respect of his contentions. He has relied upon 2015 (1) Calcutta Law Times 384 (Kaberi (Dutta) Santra & Ors. v. State of West Bengal & Ors.) and submitted that, a person must have the requisite qualification to participate in the tender process. In the present case, the petitioners does not have the requisite qualifications to participate in the subject tender process. Therefore, the petitioners cannot have the remedy as prayed for.
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Directorate of Procurement, Foreign Purchase Wing, Air Force had issued a Request for Proposal for supply of non-arsenal spares for Jaguar aircraft bearing (RFP) No. AIRHQ/CPF/243/AHQ/JAGUAR/W1725041 under single system on Limited Tender Enquiry basis dated March 12, 2018. According to the petitioners, the first petitioner has requisite qualification to participate in such tender process. The respondents dispute such contention. According to the parties to the proceedings, Defence Procurement Manual, 2009 applies to the tender process. Clause 4 of Part I General Information of the subject tender clarifies that, only those tenderers who are willing to abide by the terms and conditions of the Defence Procurement Manual, 2009 need to participate in the tendering. Appendix A of the subject tender lists the Spares that are required to be supplied under the subject tender. The spares are of foreign origin. In any event, nothing has been placed before the Court to suggest that, an Indian manufacturer is capable of manufacturing and supplying the spares which are subject matter of the tender. Chapter 9 of the Defence 10 Procurement Manual, 2009 deals with procurement of goods and services from foreign countries. Given the nature of the subject tender, Chapter 9 of the Defence Procurement Manual, 2009 applies. Clause 9.3 of the Defence Procurement Manual, 2009 deals with the registration of foreign original equipment manufacturers and vendors. It is as follows: -
"9.3 Registration of Foreign OEMs and Vendors 9.3.1 Procedure for Registration: At present foreign OEMs and vendors are being registered by the Service Headquarters and Headquarters of other Departments. Till such time as common guidelines are formulated, these Registering Authorities would continue to register foreign OEMs and vendors as per the existing procedure followed by them. 9.3.2 Registration of Authorized Vendors/Stockists of Foreign OEMs by the Service Headquarters etc.: Widening of the foreign vendor base is a multi-disciplinary and techno- commercial exercise. Registration of foreign OEMs and their authorized vendors/stockists is to be undertaken as per laid down guidelines, with the help of the Defence Attaches and Commercial Counselors in the Indian Embassies/High Commissions abroad."
The first petitioner is not a foreign original equipment manufacturer or a foreign vendor. In terms of clause 9.3.1 of the Defence Procurement Manual, 2009, the first petitioner is not entitled to registration. Registration is limited to foreign original equipment 11 manufacturers and foreign vendors. Nothing has been placed before the Court to suggest that, common guidelines have been formulated for the purpose of considering registration of entities other than foreign original equipment manufacturers and foreign vendors. The first petitioner has applied for registration by the writing dated March 27, 2017. The first petitioner acknowledges, by making such an application that, registration is required. However, as on date, and as the policy stands, the first petitioner is not entitled to the registration as applied for. Therefore, the first petitioner cannot draw sustenance from its application for registration dated March 27, 2017 and contend that, having applied for registration, and such application not being considered within 90 days from the date of the making of the application, in terms of the Standard Operating Procedure, the first petitioner should be allowed to participate in the tender process. The contention of the first petitioner that, it is supplying to Hindustan Aeronautics Limited and to the Naval Base, Kochi, is of no consequence as, the first petitioner has to abide by the Defence Procurement Manual, 12 2009 and the terms and conditions of the subject tender. As noted above, Defence Procurement Manual, 2009 requires registration of a participant as a foreign original equipment manufacturer or a foreign vendor. The first petitioner does not have such registration. In absence of such registration the first petitioner does not qualify to participate in the tender process. A person who does not possess the qualification prescribed to participate in the tender process cannot be allowed to participate therein.
Kaberi (Dutta) Santra & Ors. (supra) has considered a case where, a participant in a selection process was over qualified than the qualification required, and suppressed such fact. In such context, it has held that, a participant in a selection process must have the requisite qualification to participate therein validly. The order of the Delhi High Court in the matter of the petitioner, proceeds on the basis of the policy of 2001. The terms and conditions of the Defence Procurement Manual, 2009 were not considered. It was not placed before the Court. In any event, such an order is an interim order. Such writ petition is yet to be 13 decided. There is a subsisting interim order in the present writ petition allowing the petitioners to participate in the tender process on the condition that, ultimately, if it is found that, first petitioner is not entitled to participate then its tender would be cancelled.
The authorities are obliged to apply the terms and conditions of the tender uniformly amongst the participants. They are entitled to interpret the terms and conditions and apply it uniformly. A writ court need not interfere if the interpretation given is plausible and applied uniformly. In this case, the authorities are of the view that, the tender is limited to foreign original equipment manufacturers and foreign vendors having requisite registration. Nothing has been placed before the Court to suggest that such an interpretation is perverse or that such an interpretation has not been applied uniformly amongst all persons intending to participate.
In such circumstances, there being no merit in the writ petition, W.P. No. 7093 (W) of 2018 is dismissed. Interim orders stand vacated. No order as to costs.
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Urgent certified website copies of this judgment and order, if applied for, be made available to the parties upon compliance of the requisite formalities.
[DEBANGSU BASAK, J.]