Gujarat High Court
Shri Shivshakti Services vs Jetpur Navagadh Nagarpalika & on 7 April, 2016
Author: Akil Kureshi
Bench: Akil Kureshi, A.Y. Kogje
C/SCA/2011/2016 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL CIVIL APPLICATION NO. 2011 of 2016
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SHRI SHIVSHAKTI SERVICES....Petitioner(s)
Versus
JETPUR NAVAGADH NAGARPALIKA & 1....Respondent(s)
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Appearance:
MR ASHISH M DAGLI, ADVOCATE for the Petitioner(s) No. 1
ADVANCE COPY SERVED TO GP/PP for the Respondent(s) No. 2
MR BHAVESH P TRIVEDI, ADVOCATE for the Respondent(s) No. 1
MR RR TRIVEDI, ADVOCATE for the Respondent(s) No. 1
NOTICE SERVED BY DS for the Respondent(s) No. 2
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CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI
and
HONOURABLE MR.JUSTICE A.Y. KOGJE
Date : 07/04/2016
ORAL ORDER
(PER : HONOURABLE MR.JUSTICE AKIL KURESHI)
1. The petitioner, a proprietary concern, has challenged the action of the respondents of cancellation of the earlier tender process and inviting new tenders, for which, notice dated 18.01.2016 was issued.
2. Brief facts are as under.
3. Petitioner is engaged in the business of Page 1 of 9 HC-NIC Page 1 of 9 Created On Thu Apr 14 00:06:03 IST 2016 C/SCA/2011/2016 ORDER supplying manpower. Respondent No.1 is the Jetpur Navagadh Nagarpalika. Respondent No.2 is the Director of Municipalities. Currently the petitioner is engaged in supplying manpower to respondent No.1 Nagarpalika by way of extension of the previous contract so awarded to the petitioner.
4. Since the earlier tender period for supplying manpower was getting over, the respondent No.1 Nagarpalika invited tenders from interested contractors. After couple of failed attempts, the Municipality through the third tender process, received offers from different contractors. It was found that five agencies including the petitioner were qualified. Their financial bids were opened. Admittedly, the offer of the petitioner was lowest for supplying different kinds of personnel. The head clerk of the Nagarpalika, therefore, put a note dated 17.12.2015 for consideration of the Chief Officer. In such note, copy of which is produced at Annexure:RVI with the reply, he pointed out that out of the five qualified agencies, some of them had quoted rates below the minimum wages, which was not permissible as per the letter of the Labour Commissioner dated Page 2 of 9 HC-NIC Page 2 of 9 Created On Thu Apr 14 00:06:03 IST 2016 C/SCA/2011/2016 ORDER 15.09.2015. For the remaining agencies, he had prepared comparative charts. He noted that one Kavach Security Service Private Limited had quoted administrative charge at the rate of Rs.0.10 paisa per day, which is the lowest amongst all tenderers. However, in some categories, he has quoted below the minimum wages regarding Shivshakti Security Service i.e. the petitioner. He noted that the offers of the petitioner as well as one Success Services have quoted rates in tune with the minimum wages. However, the rates of Success Services for administrative charge are higher than that of the petitioner. He therefore suggested that the rates of the petitioner Shivshakti Security Service are in tune with the minimum wages, but his administrative rate of Rs.10 per day may be negotiated. On this note, the Chief Officer of the Nagarpalika marked as under:
"As per the report, it is necessary to call L1 for negotiations regarding the administrative rates."
This notice alongwith the remarks of the Chief Officer were placed before the President of the Nagarpalika, who on 23.12.2015, remarked as under:
"As per your report, there is a big gap Page 3 of 9 HC-NIC Page 3 of 9 Created On Thu Apr 14 00:06:03 IST 2016 C/SCA/2011/2016 ORDER between the lowest offerer and the rate of Rs.10 quoted by Shivshakti Security. In the interest of Nagarpalika, process may be initiated for inviting tenders."
5. When the respondent No.1 thus, invited fresh tenders, the petitioner filed this petition and questioned the cancellation of earlier tender process. According to the petitioner, the tender was cancelled without assigning any reasons. It was done only to favour certain individuals. The petitioner has therefore prayed for quashing and setting aside the fresh tender process.
6. On the other hand, the case of the respondent No.1 putforth by their advocate Shri Bhavesh Trivedi is that tender process was cancelled by recording and assigning proper reasons. The administrative rate of Rs.10 quoted by the petitioner was excessive. For better competition, it was decided to tender afresh.
7. At first brush, the ground recorded by the President of Nagarpalika for canceling the tender and to invite tenders afresh, may seem convincing and attractive. However, the issue requires a closer scrutiny. We may recall, the head clerk as well as Page 4 of 9 HC-NIC Page 4 of 9 Created On Thu Apr 14 00:06:03 IST 2016 C/SCA/2011/2016 ORDER the Chief Officer of the Nagarpalika were of the opinion that the offer of the petitioner Shivshakti Security Service was in tune with the minimum wages prescribed, was the lowest of all other tenderers and in any case, even after accounting for Rs.10 by way of administrative rate was much lower than the comparative offer of Shri Kavach Security Service Private Limited, which had quoted Rs.0.10 paisa for such administrative rates.
8. Since the annexures referred to in the report submitted by the head clerk in his note dated 17.10.2016 were not annexed with the reply, by our order dated 01.04.2016, we had requested the Nagarpalika to supply the same to us, which were produced on record today. Perusal of this comparative chart would show that in majority of rates for supply of manpower, the basic rates offered by Shivshakti Security Service i.e. the petitioner towards daily rates inclusive of PF and ESI were substantially and not just marginally below the next lowest rate. For example, for site supervisor with minimum qualification of B.E., Civil Engineering, the petitioner had offered Rs.345.01 as against Rs.386 by Page 5 of 9 HC-NIC Page 5 of 9 Created On Thu Apr 14 00:06:03 IST 2016 C/SCA/2011/2016 ORDER Growmore, 805 by Kavach, 710 by Success Services and 600 by Secured Services. In case of site supervisor with minimum qualification of diploma in civil engineering, offer of the petitioner was Rs.345.01 as against those of his competitors as Rs.369, 720, 591, and 525 respectively. Towards administrative rates, the petitioner quoted Rs.10 per day, Growmore has quoted Rs.19, Kavach Securities has quoted Rs.0.10, Success Services Rs.33, and Secured Services, no charge. Even after, therefore, adding Rs.10 per day towards service charges, the offer of the petitioner for supplying such manpower services was way below those of his competitors. We are not unmindful of the fact that in some of the services inclusive of the service charges, the petitioner's offer was marginally higher than the next lowest tenderer. However, the overall picture that clearly emerges from the comparative charts prepared by the Head Clerk is that the petitioner's offer was way below the consolidated offers of all other competitors. The view of the President has therefore to be seen in this background. He found the petitioner quoting Rs.10 per day per person towards service charges too high; in the Page 6 of 9 HC-NIC Page 6 of 9 Created On Thu Apr 14 00:06:03 IST 2016 C/SCA/2011/2016 ORDER process conveniently ignoring that the petitioner's base rates for supplying these manpower services, was much lower than the rates quoted by all other agencies. The decision of the Municipality to invite fresh tenders therefore was based on wholly arbitrary consideration. When the very basis on which the President opined that the fresh tenders would be in the interest of the Municipality is found to be invalid, the final decision would be tainted with invalidly. To reiterate, to call for fresh tenders only on the ground that the petitioner's offer of Rs.10 per day for service charge is on the higher side compared to Shri Kavach Security Service Private Limited, who has quoted 10 paisa per day towards such head, completely ignores the ground reality that the base rates of Shri Kavach Security Service Private Limited for supplying the manpower was way above those quoted by the petitioners.
9. The ground that the petitioner had already participated in the fresh tender proceedings and therefore, cannot challenge, needs a summary response. What the petitioner has essentially challenged is the decision of the Municipality to cancel the previous Page 7 of 9 HC-NIC Page 7 of 9 Created On Thu Apr 14 00:06:03 IST 2016 C/SCA/2011/2016 ORDER tender process. Inviting fresh tenders is a mere fall out of this decision. If the decision itself is quashed, the consequential steps initiated by the Municipality for inviting fresh tenders would automatically be rendered invalid. In order to ensure that the petitioner does not lose the right to participate in the new tender if he fails in this petition if he has also applied in response to the fresh tenders, his right to question the cancellation of the earlier tender process cannot be taken away. This is not a case where a tenderer who has participated in the tender process and who has been at the end of the excise told that his offer is not lowest and therefore, not accepted, turns around and questions the validity of the tender process.
10. In the result, the petition is allowed. The respondents shall proceed further from the stage of considering the offer of the petitioner pursuant to the note made by the Head Clerk dated 17.12.2015. In other words, the petitioner would be called for further negotiations in respect of Rs.10 of service charge per person per day. The respondent Nagarpalika shall take final decision thereafter, bearing in mind Page 8 of 9 HC-NIC Page 8 of 9 Created On Thu Apr 14 00:06:03 IST 2016 C/SCA/2011/2016 ORDER the observations made in this order. Any steps taken pursuant to fresh tender process initiated by the Nagarpalika by issuance of notice dated 18.01.2016 would be rendered ineffective. Petition disposed of accordingly. Direct service is permitted.
(AKIL KURESHI, J.) (A.Y. KOGJE, J.) ANKIT Page 9 of 9 HC-NIC Page 9 of 9 Created On Thu Apr 14 00:06:03 IST 2016