Gauhati High Court
Real Mazon India Ltd. vs State Of Assam And Ors. on 16 November, 2007
Equivalent citations: 2008(1)GLT1020
Author: Amitava Roy
Bench: Amitava Roy
JUDGMENT Amitava Roy, J.
1. The challenge in the constitutional attire, as the instant proceeding evinces, is mounted against the tender process initiated by the Transport Department of the State for selection of an eligible manufacturer to produce High Security Registration Plate (hereafter also referred to as the HSRP) for all types of vehicles. The assailment is spurred principally by the impugned corrigenda dated 26/12/ 2006,6/1/2007 and 16/1/2007 which while insisting on the Conformity Of Production Certificate (hereafter referred to as the COP) as a condition of eligibility for participation therein deleted the covenants pertaining to experience, expertise and exposure of the bidders in the enterprise of manufacture/production of the said plates as well as the earmarked percentage of turnover from such business demonstrating their eligibility for being considered for the proposed settlement. The petitioner perceives the impugned prescriptions embodied in the corrigenda as well as an annihilation of the essential conditions of tender for the HSRP contrary to the ratio decidendi in Association of Registration Plates v. Union of India and Ors. and the guidelines to the said effect formulated by the Central Government. This Court by its order dated 19/1/2007 while issuing notice restrained the State authorities from proceeding further with the exercise.
2. I have heard Mr. PK Goswami, Sr. Advocate assisted by Mr. Satyan Sharma, Mr. Arunabh Choudhury, Mr. J. Deka, Mr. A. Sharma and Mr. TK Bhuiyan, Advocates for the petitioner, Mr. N. Dutta, Sr. Advocate assisted by Mr. AK Bhuyan, Advocate for the State respondents, Mr. DK Mishra, Sr. Advocate assisted by Ms. Shamima Jahan, Advocate for the respondent No. 5 and 6 and Mr. D. Das, Advocate for respondent No. 8 and 9. Though an affidavit has been submitted on behalf of the respondent No. 4, none appeared to conduct the proceedings on its behalf.
3. The edificial facts in brief demand a narration to project the rival versions. The petitioner has introduced itself to be a Joint Venture Company between Mazon BV of Netherlands, CBM Industries Limited, New Delhi and Mr. NVS Rao. It asserts to be qualified to implement the HSRP scheme and claims to satisfy all the mandates of Rule 50 of the Central Motor Vehicle Rules, 1989 (hereafter referred to as the Rules) (as amended) as well as the enjoinments engrafted in the Association of Registration Plates (supra). It possesses a valid Type Approval Certificate (hereafter referred to as the TAC) issued by the Central Road Research Institute, New Delhi. The petitioner has affirmed that the Transport Department of the State is entrusted with the responsibility of implementation of the HSRP scheme in the State and that the respondent No. 3,4 and 5 are the approved Test Agencies authorized to issue the TAC as well as the COP for such plates. According to the petitioner, though no COP can be issued by any of such agencies unless a bidder/ venture is awarded with the contract for the manufacture of such plates and has started the production, supply and affixation thereof, the respondent No. 3,4 and 5 have been issuing at random such certificates to various manufacturers though still not awarded with the contract in any State in India.
4. The petitioner has maintained that in order to curb the growing menace of crime rentable more particularly to the terrorist activities employing motor vehicles to serve their diabolical ends, the Central Government in its wisdom on the advice of the concerned Technical Committee evolved a new scheme of HSRP consequent whereupon Rule 50 of the Rules was amended by the notification dated 23/8/2001. To fulfill the requirements of the said scheme, the Central Government issued notifications dated 22/8/2001 and 16/ 10/2001 as wel1 which not only regulated the same but also ensure that the avowed objective of safeguarding and enhancing public safety and security is essentially achieved.
5. The scheme comprehends technical high security features of such plates so much so that the same cannot be duplicated, removed or replaced ensuring certain and easy identification and tracking of the vehicle, if called for. It makes it mandatory for the intending manufacturers to obtain TAC from one of the notified agencies as per Rule 50 of the Rules to render it prima facie eligible to be entitled to be eligible for selection for manufacture and supply of HSR P. The implementing agency is the State through its registering authority. The concerned registering authorities have to issue the number as well as the HSRP to be fixed in the premises of the Regional Transport Officer by the selected manufacturer. While contending that the venture envisaged is thus to be conducted under the complete supervision of the State authorities, the petitioner has averred that the prescribed features of the plates have for the first time been introduced all at a time in India. According to it, the technology to produce such features is admittedly still not available in the country and accordingly the States being the implementing agencies, it is their solemn responsibility to select a suitable manufacturer from amongst the TAC holders tested on the touchstone of rigid and strict conditions of eligibility to guarantee the attainment of the salutary objective of the scheme.
6. Joint deliberations followed involving the States, Center and the prospective manufacturers to decide that the selection from amongst the TAC holders should be through a fair method by inviting tenders and that as having regard to the highly sophisticated device to be produced and the national interest and public security involved, strict and rigid eligibility conditions ought to be imposed to ensure that the most competent, experienced and technically and financially sound manufacturers participate in the process. After exhaustive parleys between the Transport Secretaries/Transport Commissioners of all States/Union Territories including the State of Assam, suggestive guidelines in this regard were framed on 6/3/2002.
7. Accordingly during the years 2002 and 2003 about 18 States in the country floated tenders for implementing the scheme, which amongst others specified the following conditions of eligibility.
1. The bidder or its joint venture partner must have experience of working in the specified security features in at least four countries (in some states the requirement was three and in some five countries).
2. The net worth of the bidder or its JV partner should be Rs. 30/- crores. This varied from State to State between 20/- to 50/- Crores.
3. The turnover should be Rs. 50/-Crores out of which 25% should be from HSRP business. Again this varied from State to State.
4. The period of contract should be for 15 years.
Most of the States preferred a single manufacturer for the whole State.
8. Certain TAC holders, which included Joint Venture Companies and indigenous manufacturers but had no technical collaboration challenged the tender conditions in various High Courts. These Companies neither did have any experience of working in the field of specified security features anywhere in the world nor possessed the financial capability to execute such a mega project. At the instance of All India Motor Vehicle Security Association of which the petitioner is a member, the said petitions were, however, transferred to the Supreme Court. The petitions challenging the tender conditions prescribed by various states as per the guidelines issued by the Central Government in various High Courts as well as the Supreme Court were eventually transferred to the Apex Court by order dated 2/5/2003 in T.P. (C) No(s). 995-997 whereby though the States involved were permitted to go ahead with the process and finalize the same, they were directed to file the letter of award before it without intimating the successful bidder. The tender conditions impeached were, after a comprehensive adjudication, sustained by the Apex Court in its decision in Association of Registration Plates and Ors. supra. Resultantly all the petitions were dismissed.
9. The Commissioner of Transport Department, Government of Assam, thereafter on 15/11/2006 issued an advertisement inviting bids for the HSRP project in the State of Assam. Though the same mentioned about the aforementioned guidelines and necessity of the requirement of experience in manufacture and production of HSRP and its business, it (advertisement) was withdrawn on 21 / 11 /2006 without, however, recording any reason therefor.
10. It was thereafter on 7/12/2006 that the State authority issued a fresh Invitation For Bids (hereafter referred to as IFB) inviting offers for selection of an eligible manufacturer having TAC and the requisite manufacturing capacity to produce HSRP in conformity with the specifications in the notifications dated 28/ 3/2001,22/8/2001, 16/10/2001 and 12/6/ 2006 appertaining to HSRP in India on "BUILD OWN AND OPERATE" BASIS.
11. The petitioner intending to participate in the pursuit obtained the bid document, which disclosed that the contract would be awarded to the successful bidder for 10 years for manufacture and supply of HSRP in the State of Assam. While Clause 1.2.3. disclosing the objective of the bidding process revealed HSRP as a highly sensitive product for prevention of crimes and involving high security features to prevent counterfeiting and duplication thereof, it underlined the imperative to select manufacturer(s) for Assam who would have necessary experience, expertise and exposure to such works and of such complexity in India and/or abroad, so that the security objective of the scheme may not be diluted or vitiated. The said Clause emphasized on the strictest adherence of high security features and the accountability of the successful bidder(s).
12. The eligibility criteria prescribed in Clause 1.5.3 of the IFB ordained sufficient experience in the field of Registration Plates with at least two security features as specified by the Government of India. Clause 2.20.1.3 dealing with the procedure for opening of the bids postulated that experience in the field of Registration Plates/Security Registration Plates would be evaluated on the basis of the marks obtained as per a pro forma attached by the bidder as Annexure 13 pursuant to Clause 1.5.3 and the qualification would depend on the marks secured. Thereunder a bidder to qualify was to secure at least 50% marks out of a total of 160 i.e. 80. Abidder was further required to obtain a minimum of 40 marks in both the sections A and B incorporated in Annexure 13.
13. While Section A obligated the bidder to list out the countries where the bidders) in the joint venture had worked or had been working, Section B enjoined the bidder/constituent partner to enumerate the details of the countries where it had worked or had been working for Security Registration Plates with the security features required by the Rules. Section B specified four security features and also provided columns to mention the countries, particulars whereof were required to be furnished by the bidder. Clause 1.5.5 and 2.3.6 of the IFB necessitated that a bidder should have a minimum average turnover equivalent to INR 30 Crores in the immediate preceding year of which 15% thereof should be from the registration plates business. Submission of a COP was not stipulated as an essential pre-qualification requirement.
14. The process contemplated a three tier bid comprising of the Pre-qualification bid in Envelope No. 1, the Technical Bid in Envelope 2 and the Financial Bid in Envelop 3 predicating that a bidder to advance to the phases of evaluation of its Technical and Financial Bid would have to cross the Pre-qualification stage.
15. The above notwithstanding, according to the petitioner, the Clauses were not free from ambiguities and vagueness and most importantly did not fully conform to the stipulations of experience approved by the Apex Court in Association of Registration Plates (supra). Representations of some of the manufacturers similarly situated as the petitioner and members of same association followed pointing out the deficiencies in the experience Clause.
16. The respondent No. 2, in the above background, issued the impugned corrigendum dated 26/12/2006 occasioning major amendments in Clause 1.1.21,1.2.3 and 2.20.1.3. thereby modifying the definition of "Prime Manufacturer" to mean an individual or firm or corporate entity engaged in carrying out the manufacturing activity of the HSRP having obtained TAC and COP from a Government authorized agency mentioned therein deleting the requirement of experience, expertise and exposure and paragraph 2 of Clause 2.20.1.3. specifying the marking system.
17. This was followed by the impugned corrigenda dated 6/1/2007 deleting the stipulation of experience mentioned in Clause 1.5.3. and Clause 2.20.1.3. and Annexure 13 providing for working out the marks for experience. The prescription of 15% turnover from registration plate business in Clause 1.5.5. was also effaced.
18. By the impugned letter dated 16/1/ 2007, the respondent No. 2 intimated the petitioner that consequent upon the amendment of Clause 1.5.5. and deletion of the condition of 15% turnover from registration of plate business, the said requirement appearing in Clause 2.3.6. also stood omitted. Thereby the petitioner was further informed that the date for submission of bids had been extended till 24/1/2007 and that the same would be opened on the very same date at 1600 hours.
19. The petitioner has asserted that through the corrigenda as above, the requirement of experience originally mandated in the IFB had been done away with in contravention of the law laid down by the Apex Court in Association of Registration Plates (supra) and derogation of the guidelines for implementation of HSRP issued by the Ministry of Road Transport and Highways, Government of India, formulated in accord with Rule 50 of the Rules. Not only the insistence for COP at the bidding stage lacked logic and rationale, such document being issuable only after the authorization is received by the successful bidder from the Road Transport Officer to supply HSRP as per para 4(ix) of the Motor Vehicles (New High Security Registration Plates) Order, 2001 (hereafter referred to as the Order), it afflicts the tender process with an incurable illegality. The withdrawal of the essentiality of 15% of the turnover from registration plate business has also been denunciated to be extinctive of the imperative trait of experience recognized as a quintessential demand for the desired implementation of the HSRP scheme considering the underlying end objective thereof. The petitioner thus seeks annulment of the IFB dated 7/12/2006 and the corrigenda dated 26/12/ 2006,6/1/2007 and 16/1/2007.
20. The petitioner has in support of its challenge referred amongst others to an order dated 27/3/2006 of the Madras High Court in Writ Petition No. 8460/2006 questioning the requirement of furnishing COP in the tender dated 22/2/2006 issued by the State of Tamil Nadu for implementation of HSRP scheme in the State. The Madras High Court while issuing notice recorded the statement of the learned Additional Advocate General of the State that the tenders would not be finalized for the present and that the petitioner would not be disqualified on the ground of COP. By the said order, the State of Tamil Nadu was restrained from opening the Financial Bids pending further orders. Reference has also been made of a similar tender process initiated in the State of West Bengal wherein the requirement of experience initially incorporated in the notice inviting tender was deleted. Though the challenge thereto before the Calcutta High Court in WP(C) 2083/ 2005 was negated the related SLP(C) 11621/ 2006 by Shimnit Utsch India Pvt. Ltd. and another against West Bengal Transport Infrastructure Development Corporation Limited and others before the Apex Court is pending and by an interim order, the State of West Bengal has been restrained from awarding the final contract. A declaration in the present case has also been prayed for adjudging the COPs issued by the respondents 3 to 5 to other manufacturers/vendors who have not implemented the HSRP project as illegal, null and void.
21. The State respondents in their affidavit while denying the charge of arbitrariness, illegality and discrimination vis-a-vis the tender process have contested the averment that the IFB and the impugned corrigenda seek to completely delete the conditions pertaining to experience, expertise and exposure. They have categorically denied that the IFB and the impugned corrigenda are contrary to the law laid down by the Apex Court in Association of Registration Plates (supra) and the guidelines promulgated by the Central Government for the implementation of HSRP scheme.
22. Refuting the allegation that the IFB and the impugned corrigenda, if sustained, would be detrimental to the larger public interest, the answering respondents have iterated that the eligibility criteria stipulated in the IFB and the impugned corrigenda have been directed to ensure participation of all entities having a valid TAC from any of the authorized test agencies specified in the Order. They have disclosed that on receipt of various representations from several TAC holders a decision was taken to delete the experience clause to enlarge the field of participation to facilitate the availability of HSRP at the most competitive price in public interest.
23. The State respondents have maintained that the IFB contains other stringent provisions adequate enough to protect the objective for which the HSRP scheme has been introduced. While emphatically pleading that the petitioner's contentions are based on a wrong interpretation of the decision of the Apex Court in Association of Registration Plates (supra) they have insisted that in the matter of formulating the conditions of a tender document and awarding of contract for HSRP, a greater latitude has to be conceded to the State authorities as held therein. Not only the Central Government guidelines are suggestive in nature, the above judicial pronouncement clearly acknowledges the prerogative of the State Government in fashioning the eligibility norms in the notice inviting tender, which cannot be subjected to judicial review.
24. According to the answering respondents, not only the IFB does not suffer from any ambiguity or shortcomings as alleged, with the corrigenda, the tender document has become less cumbersome and onerous whereby all contending bidders have been provided a level plane with uniformly fair and impartial eligibility criteria to ensure a free, open and a participatory competition for the settlement. Not only the Apex Court in the said decision has not mandated an inflexible adherence to the experience clause involved therein inhibiting any deviation therefrom, the amendments neither prohibit the petitioner's partaking in the process nor impinge upon any of its constitutional or legal rights.
25. The respondents have clarified in clear that the corrigendum dated 26/12/2006 does not incorporate the submission of COP as an obligatory pre-condition for participation in the tender process. According to them, there is no reference of "Prime Manufacturer" otherwise than in Clause 1.1.21. of the IFB. While admitting that the State is responsible for the implementation of the HSRP scheme in Assam, it has been admitted that the amendments in the original clauses of the IFB vide the impugned corrigenda had been effected on account of representations received from various TAC holders. The State respondents have pleaded that the steps to the said effect had been taken to ensure participation of all 18 TAC holders and guarantee competitive pricing through a fair, impartial and transparent venture. They have insisted that the condition of experience and percentage of turnover from registration plate business are neither essential nor mandatory and the Apex Court as well have not adjudged those to be so. They have alleged that the petitioner's impugnment of the subsisting IFB Clauses is impelled by its monopolistic designs and to exclude eligible competitors by constricting the field of fray even at the cost of public interest and State revenue. The impugned tender affords an equal opportunity to all the approved TAC holders and is in no way repugnant to the letter and spirit of the scheme. The respondents have assured that the bids submitted would be evaluated technically as well as financially by a team of experts and that the most suitable and technically qualified bidder would be selected for execution of the scheme. The respondents have contended that the petition does not disclose any cause of action warranting dismissal thereof.
26. The Respondent No. 4, M/s Automotive Research Association of India while claming itself to be one of the Approach Authorities notified under Rule 126 of the Rules for issuance of TACs to the automotive vehicles, auto components and pollution testing equipments etc. has abstained from offering any comment on the averments bearing on the experience in and turn over from HSRP business being not concerned therewith. It, however, clarified that the test agencies under the Rules work on the basis of COP procedure and check points issued by the Ministry of Road, Transport and Highways, Government of India vide its letter No. RT-11028/ 5/2002-MVL dated 4/9/2002 and as per the laid down procedure there are two types of COP viz. the first COP and the subsequent COP. As per the said letter the prospective vendors after establishing the manufacturing plants in the country would inform the concerned Testing Agency which had granted TAC within one month of the commencement of manufacturing. The agency would draw samples of the plates from the plants within three months of the date of commencement of the production (COP) and carry out all the tests, which are carried out at the Type Approval stage.
27. The first COP would be conducted at the manufacture's plants and the subsequent COPs would be done on the basis of the samples picked at random from the vendors' premises. The letter required that the checks of the first and subsequent COP were to be carried out in accordance with the steps specified in the annexures appended thereto. The deponent, Deputy Director of the answering respondents pleaded that the first COP seems to be for confirming the manufacture's capability for producing HSRP to the specified requirements and the subsequent COP is to be performed after implementation of HSRP. According to the deponent, the first COP was thus to be done after establishing facility and commencement of pilot production, whereas the subsequent COP is to be conducted only after the contract is awarded to the vendors by the State. Reinforcement of the above view is sought to be drawn from the letter No. 1028/5/MVL dated 20/6/2005 of the Ministry of Road Transport and Highways, Govt. of India. The deponent, therefore, asserted that that the respondent No. 4 on following the procedure and checkpoints laid down by the Ministry of Road Transport and Highways acted within the scope and parameters of the Rules and thus the COP certificate issued by it cannot be dubbed or styled as unwarranted and/or illegal.
28. In their counter, the respondent Nos. and 7 have presented the former to be a Company incorporated under the Companies Act, 1956 with its registered office in New Delhi. They have claimed that the respondent company is possessed of a valid TAC granted by the respondent No 5 and is one of the prospective bidders in the process involved. The respondents have denied the allegation that the IFB is arbitrary, illegal or discriminatory and have affirmed that the eligibility criteria stipulated by the impugned corrigenda are construed to afford an opportunity to all 18 TAC holders to participate in the process thereby infusing competition for the benefit of the public at large. While pleading that the pet doner's interpretation of the decision of the Apex Court in Association of Registration Plates (Supra) is erroneous, they have contended that it was not held therein that the conditions pertaining to the experience, expertise and exposure were essential in nature. On the other hand, the Apex Court had declared the stipulations under challenge therein were beyond judicial review. According to them, the Transport Department, Assam, in larger public interest deleted the conditions relating to experience to facilitate wider participation ensuring competitive prices and by incorporating the eligibility criteria relating to the financial capability and solvency to the extent of Rs. 30 crores, the respondent No. 2 thereby guaranteed effective and efficient implementation of the Project by the successful bidder.
29. The respondents maintained that the Corrigendum dated 26/12/2006 did not require any bidder to furnish COP certificate as a condition precedent for participating in the tender process, the only eligibility criteria prescribed by Clause 1.5 and 1.5.6 being a valid TAC from any of the test Agencies under the Order. They emphasized that only eligibility criteria laid down in Rule 50 of the Rules is a valid TAC from any of the prescribed 3 test Agencies and that no other condition or eligibility criteria has been specified by the said provision of the Rules or under the Order or by the Apex Court in Association of Registration Plates (Supra).
30. The respondents averred that the guidelines issued by the Ministry of Road Transport and Highways, Government of India is only indicative and suggestive in nature and thus not binding on the State Government. The eligibility criteria prescribed in Clause 1.5.3 of the IFB dated 7/12/2006 as it deleted by the Corrigendum dated 6/1/2007 has the potential of restricting participation of all the TAC holders and thus excluded competition to ensure the least possible price. The respondent No. 6 being faced with that constriction thus submitted a representation before the respondent No. 2 for deletion of the experience clause to ensure equal opportunity of participation of all TAC holders. The eligibility criteria after such deletion is consequently fair providing a level playing field for all concerned without in any way causing any prejudice or detriment to the interest of any bidder. While contending that it was impermissible for the petitioner to claim that the condition regarding experience, expertise and exposure should be compulsorily incorporated in the IFB, it being the sole prerogative of the State Government, the respondents referred to the tender process of the State of Uttar Pradesh and West Bengal which similarly did not stipulate experience in different countries and certain percentage of turnover from the registration plates business as a condition of eligibility.
31. They, in turn, imputed the motive of the petitioner and other two companies namely, Tonnges Eateren Security Technologies Primate Limited and Shimnit Utsch India Private Limited forming a cartel to usurp the entire business of HSRP throughout the country at highly exorbitant rates by insisting upon the incorporation of covenant of experience, exposure and expertise in the NITs floated by various States Governments.
32. While referring to the observation of " the Apex Court in the aforementioned decision that greater latitude is required to be conceded to the State authorities in the matter of formulation of conditions of a tender document and awarding of contract for supply of HSRP, the respondents emphasized that the Corrigenda neither debarred the petitioner from participating in the process, nor prejudiced it in any manner whatsoever. They categorically averred that the criteria of experience and percentage of turnover were not essential or mandatory as per the Rules or the verdict in the Association of Registration Plates (Supra). They maintained that TAC in the country is granted only after the HSRP submitted to any of the three test agencies for testing, conform to extremely stringent standards, specifications and tests considering that the security features insisted upon are being introduced for the first time in the country.
33. In their additional affidavit, the said respondents have furnished clippings from the dailies, Assam Tribune, Shillong Times and Week, National News Magazine highlighting the resentment of the Joint Action Coordination Committee, a conglomerate of several social organizations demanding reduction of rates fixed for High Security Registration Number Plates in Meghalaya.
34. The counter of the Respondent Nos. 8 and 9 is structured similarly as that of the respondent Nos. 6 and 7. The deponent thereof claiming to be the Director of the Respondent Nos. 7 and 8 has contended that the latter holds the TAC granted by the respondent No. 3. It too is one of the prospective bidders for the process. The answering respondents have reiterated the averments made in the affidavit of the respondent Nos. 6 and 7 in all essential particulars for which the repetition thereof is considered inessential. They have, however, alleged that the petitioner and other two companies named in the counter of the respondent Nos. 6 and 7 have initiated legal proceedings in different courts insisting upon the incorporation of clauses relating to the experience, exposure and experience in the Notice Inviting Tender (NIT) and Information for Bidder (IFB) by various State Governments contending the same to be essential and mandatory to achieve a monopolistic end and usurp in the business of HSRP throughout the country at a highly inflated and exorbitant rates to the extent of five times than that of the lowest bidder.
35. The respondent Nos. 6, 7, 8 and 9 amongst other have annexed to their counter an affidavit filed by the West Bengal Transport Infrastructure Development Corporation Ltd. in SLP No. 11621/2006 pending before the Apex Court and have pleaded inter alia that the conditions of experience, exposure and expertise were not incorporated in the NIT involved therein so that the price of HSRP was not abnormally engineered by some unscrupulous and dishonest business-men forming caucus and coteries for their own business interest at the cost of the public at large.
36. The answering respondents reiterated that the impugned Corrigenda prevents the monopoly of the petitioner and its associates members and promote participation of all TAC holders to achieve the objectives of the amended Rule 50 in a most effective and efficient manner.
37. In its reply affidavit to the counter of the Respondent Nos. 1 and 2, the petitioner while generally reiterating and reaffirming the averments in the writ petition, have sought to drill in the plea that the State respondents have failed to disclose the reason for deleting the essential conditions of experience, expertise and exposure and has insisted that from the amended definition of prime manufacturer, COP is evidently a condition of eligibility for participation in the tender process. It reiterated that the deletion of clause pertaining to experience, expertise and exposure is at the instance of TAC holders referred to as " Fly by Night Operators" by the Apex Court in Association of Registration Plates (Supra).
38. While insisting that the technology for the manufacture of HSRP with the security features as sought for is not available in India till date, except the State of Meghalaya, the petitioner has dismissed the plea of wider participation and competition as a bogie, thus undermining the sanctity of the scheme, national security and public safety involved. It has avowed that the technology or know how in the manufacture of HSRP is presently available outside India and the scenario as it existed at the adjudication in Association of Registration Plates (Supra) remains the same till date. The petitioner has insisted that the Central Government's guidelines are binding on the State Government and that the tender process structured on the IFB dated 7/12/ 2006 and the impugned Corrigenda are opposed to the letter and spirit of the decision of the Apex Court in the aforementioned decision and the said guidelines and if sustained would defeat the scheme of HSRP and prove repugnant to the larger public interest.
39. Replying to the pleaded averments of the respondents 6 and 7, in its rejoinder, the petitioner while reasserting its contentions has avouched that the respondent No. 6 being reportedly engaged in the business of CNG Kit Converters and Hydraulic Press Machines, has no experience what so ever in HSRP and, therefore, awarding of the contract to it would be evidently on a hit and trial basis which the Apex Court has propounded to be impermissible. The petitioner reiterated that the deletion of the essential conditions of experience, expertise and exposure would have a cascading effect on the project and utterly defeat the same and the underlying objective thereof. The tender process seeks to provide access to inexperienced and incapable bidders with no exposure to or concern about the strategic significance of HSRP which if sustained would be a travesty of a selection envisaged in law.
40. As a TAC is not an impregnable index of the capacity, capability, experience and exposure of the holder thereof for implementation of the project in hand, the relaxation of the essential conditions of experience, defies logic and would facilitate admission of "fly by night operators" like the respondent No. 6, 7,8 and 9 to the tender process though categorically discountenanced by the Apex Court in Association of Registration of Plates (supra). The petitioner has alleged that the corrigenda demonstrates the State authorities submission to the pressure of respondent No. 6 and other units unqualified to participate in the venture.
41. According to the petitioner, the tender process initiated by the State of Uttar Pradesh sans the strict conditions of experience has faced a serious set back for which the project remained unimplemented for the last four years and eventually the letter of acceptance issued in favour of the lowest bidder on 5/7/ 2003 has been cancelled. The lis pertaining to the tender in the State of West Bengal dehors the essential conditions of experience is presently awaiting adjudication before the Apex Court in SLP(C) 11621 /2006 wherein the State authorities have been restrained from awarding the final contract pending disposal thereof.
42. The petitioner has specifically denied the allegation that it, along with the other members of its Association, has formed a coterie to usurp the entire business of HSRP. Citing the instance of an identical process launched in the State of Tamil Nadu challenged by it before the Madras High Court in writ petition No. 8460/2006 questioning the omission of the essential conditions of experience and prescription of a valid COP at the bidding stage, the petitioner has affirmed that the State Government during the pendency of the said proceeding by order dated 21/3/2007 has cancelled the related NIT and decided to commence a new process in terms of the guidelines of the Government of India and the ratio decidendi in Association of Registration Plates (supra). A copy of the affidavit filed by the State of Tamil Nadu on the above effect has been annexed.
43. The petitioner has repudiated the newspaper reports submitted by the respondents 6 and 7 to be irrelevant and inconsequential to the issue and has referred to an order dated 18/12/2006 passed by this Court in WP(C) 294 (SH)/2006 assailing the decision of the Government of Meghalaya suspending the implementation of the HSRP scheme in the State. The relevant extracts of the order has been set out in the affidavit whereby this Court stayed the impugned order observing that the implementation of the scheme was called for in public interest and that the State respondents were not expected to buckle under the pressure of Non-Governmental Organizations when the cause espoused by them was obviously repugnant thereto (public interest).
44. The petitioner's reply to the pleaded stand of the respondents 8 and 9 is essentially the same. It has stated that the respondent No. 8 who claims to have entered into a Joint Venture with Ameera Foods Pvt. Ltd., an exporter of Basmati rice obviously has no experience in the business of HSRP. Not only the said respondent has failed to disclose any experience or expertise in the manufacture of HSRP, its participation in the process eased by the deletion of the essential conditions of experience, expertise and exposure merely as a holder of TAC would be incompatible with the elucidation of the Apex Court in Association of Registration Plates (supra) discountenancing such an access. The petitioner has maintained that considering the strategic location of the State of Assam geographically with alarming rate of crimes involving motor vehicles, a rigorous implementation of the scheme without diluting the conditions of experience, expertise and exposure is uncompromisingly essential in the interest of the safety and security of the State and its people.
45. While reiterating that a TAC is not adequate to demonstrate a bidder's technology and wherewithal to implement the project and that the impugned relaxations approve the participation of bidders having no experience and exposure and capability or capacity to implement the project, the petitioner has pleaded that the impugned tender process displays unjustified departure from the ratio in Association of Registration Plates (supra) binding on all States and Union Territories. The allegation of wilting of the State authorities to the pressure of the otherwise unqualified TAC holders including the respondent No. 8 having no experience in the field of HSRP has been reiterated. The charge against the petitioner of forming a cartel with other members of its association to hijack the process for monopolistic attainments has been categorically denied. The counter affidavit of the West Bengal Transport Infrastructure Corporation Ltd. (supra), in SLP(C) 11621/2006 before the Apex Court has been dismissed as irrelevant for the instant proceeding. By its additional affidavit, the petitioner has placed on record, the corrigendum dated 26/12/ 2006.
46. In the face of the intensely competing pleadings, Mr. Goswami has argued that having regard to the factual background, the wholesome objectives of the scheme, the technically sophisticated device involved and the technical expertise and financial soundness essential to administer the mammoth project to be implemented, the conditions of experience, expertise and exposure are obviously essential in nature to achieve the purpose of the enterprise and, therefore, the impugned tender process patterned on deviations therefrom is extinctive of the scheme and is thus liable to be adjudged illegal, unconstitutional, null and void. As the technology for the manufacture of the HSRP with the features prescribed by Rule 50 is admittedly not available in India and the achievement of the purpose of the scheme and its objectives is of indispensable necessity, the process imperatively has to be restrictive in nature inadmissible for any and every prospective entrepreneur to chance the award, he urged. The learned Sr. Counsel contended that the scrutiny for selection therefor has to be unmistakably focused on the experience having capability of a bidder lest the whole exercise ends in a misadventure with serious adverse consequences bearing on national security and public safety.
47. Referring to the relevant Clauses in the IFB dated 7/12/2006 and the amendments introduced by the impugned corrigenda, Mr. Goswami has emphatically pleaded that the precondition for the submission of COP as is apparent from the definition of prime manufacturer in Clause 1.1.21. is per se arbitrary, illogical and unrealistic inasmuch as such a certificate is issued by the acknowledged test agencies under the Order only to a successful bidder once it commences the manufacture of the HSRP pursuant to the award of the contract for it. Mr. Goswami was skeptical about the pleaded stand of the State respondents that such a certificate, the definition of prime manufacturer notwithstanding was not an essential condition of eligibility for participation in the process in absence of any corrigendum by the State authorities to the said effect. He, therefore, maintained that on this ground alone the impugned tender process is liable to be struck down.
48. The learned Sr. Counsel was persuasively critical on the deletion of the clauses relating to the experience, expertise and exposure as well as the turnover from HSRP business contending that the same is in outright contravention of the mandate engrafted in the decision of the Apex Court in Association of Registration Plates (supra) ruling those to be essential having regard to the nature and character of the manufacturing activity and the underlying objective of the scheme, Mr. Goswami urged that the State authorities being convinced that the experience and adequate financial involvement in HSRP business were indispensably essential as conditions of eligibility for a bidder intending to participate in the tender process, had consciously incorporated stipulations pertaining thereto in the original IFB and therefore the systematic withdrawal thereof consequent upon the submission of representations by the TAC holders not meeting the said criteria is not only mutilative of the scheme but proclaims an arbitrary and malafide executive fiat.
49. The HSRP being a sophisticated product as featured by Rule 50 of the Rules, the State Governments, the Union Territories, the Central Government and the prospective bidders after comprehensive deliberations concurred on broad parameters culminating in the guidelines formulated by the Central Government for uniform application and, therefore, the verdict of the Apex Court in Association of Registration Plates (supra) on a consideration of all relevant facts, declared the conditions of experience and financial soundness as prescribed to be peremptory not relaxable in the perspective of the uniqueness of the scheme and the sanctity of the objectives sought to be achieved. Not only the so called justifications offered by the State respondents for construing these determinants to be inessential are neither convincing nor cognizable in law, such an approach is in breach of the judicial adjudication in Association of Registration Plates (supra) approving the criteria of experience and financial soundness to be indispensably essential, he urged.
50. Mr. Goswami argued that the plea of wider participation having been negated by the Apex Court in the aforementioned decision, bearing in mind, the scheme and the objectives thereof and tested in the touchstone of public safety and security, the tender process is opposed to the letter and spirit of the pronouncement besides trivializing the significance of security features as mandatory attributes of the HSRP comprehended under Rule 50. By no means, the learned Sr. Counsel contended that the TAC as the sole condition of eligibility and enhanced field of participation at the cost of experience and financial credibility of the bidders can be legally acceptable grounds in defence of the assailed IFB Clauses. As stringency of the stipulations of eligibility is contingent on the nature of the work to be performed in any venture, the participation in the related process has to be necessarily confined to those who qualify in terms thereof, he maintained. Mr. Goswami sought to impress upon this Court that the situation as obtained at the pronouncement in Association of Registration Plates (supra) has remained unchanged as on date and that the technology of the manufacture of the HSRP is still not available in India and thus the relaxation of the conditions of experience and financial capability vis-a-vis HSRP business is a patently illegal, arbitrary and whimsical abandonment by the State of the framework of essential conditions approved by the Apex Court as above.
51. Not only the plea of monopoly and exclusion of indigenous entrepreneurs similarly raised in Association of Registration Plates (supra) has been rejected by the Supreme Court, on a consideration of the schematic characteristics of the project and the end goal in view, the impugned action is not only annihilative of the scheme but seeks to overreach the binding conclusions in the said decision, he urged. As the competitive rates offered only by eligible tenderers complying with the recognized and proclaimed essential conditions of eligibility would be legally ac-knowledgeable, the reasons for omitting the criteria of experience and financial returns in HSRP business are purported and not real and manifestly demonstrate an autocratic exercise of executive authority thoroughly unmindful of the overwhelming purpose of the scheme and the State's responsibility for the due accomplishment thereof.
52. Besides as the State authorities have resorted to the amendments readily acting on the representations by the TAC holders including respondents 6,7,8 and 9 enabling them, otherwise not eligible, to participate in the process, they have unjustifiably compromised with the essential conditions of eligibility and thus the impugned action lacks in bonafide and transparency vitiating the entire exercise. The learned Sr. Counsel with reference to the similar process in the State of UP and Tamil Nadu argued that while in the former the project in absence of the essential conditions of experience and financial stability had to be eventually cancelled for the attendant predicaments, the State of Tamil Nadu in its wisdom decided to recall the exercise for initiating a fresh one inconformity with the decision in Association of Registration Plates (supra) and the Central Government guidelines. Mr. Goswami referring to the order dated 22/8/2006 passed by the Apex Court in SLP(C) 11621/2006 involving a similar process in the State of West Bengal contended that the same only reinforces the petitioner's contentions. In all, Mr. Goswami urged that the tender process in the present form is patently illegal and unconstitutional and is therefore liable to be adjudged inoperative, nonest and void.
53. Mr. Dutta as against this submitted that their being no discernible mandate in Association of Registration Plates (supra) that the tender conditions involved therein including those of experience and financial capability vis-a-vis HSRP business were peremptorily essential and not depurtable in any circumstances, the wisdom and dominion of the State to frame its norms for distribution of State largesse including contracts cannot be questioned as no existing law prohibits the State to alter the IFB conditions involved to appropriately suit its demands. The learned Sr. Counsel urged that the petitioner's insistence for the incorporation of exclusionary clauses of experience and financial involvement in HSRP business is to unfairly compress the field of competition to its benefit and wrest the contract on superior money power. The impugned corrigenda being engendered by administrative exigencies and not inhibited by any statute more particularly Rule 50 of the Rules with the altruistic purpose of permitting greater competition for competitive price, no interference in the exercise of the power of judicial review is warranted. Mr. Dutta affirmed that the COP has not been prescribed as a pre-requisite for a valid offer and contended that, therefore, the arguments built thereon are immaterial and ought to be ignored. The stipulations of the IFB being within the realm of contract and the reasons assigned in support of the corrigenda being objective logical and rationale, the prayer for judicial intervention is misconceived more particularly as neither the petitioner is disqualified thereby nor is its right or interest in any manner adversely affected, he urged. Mr. Dutta pointed out that not only the representation submitted by a Company of the same group as the petitioner is conspicuously silent about any transgression of the proposition recorded in Association of Registration Plates (supra) the modifications as perceived to be necessary having been made at a pre-bidding stage, the same by no means vitiate the tender process. He argued that a corrigendum altering or modifying a clause in a tender process being an inseparable part thereof and the State's power to issue the same being not under challenge, having regard to reason and purpose thereof, the impugned action cannot be faulted with.
54. Referring to the affidavit of the West Bengal Transport Infrastructure Development Corporation in SLP(C) 11621/2006 pending before the Apex Court, Mr. Dutta highlighted that on the face of the record, the tender process with the conditions of experience and financial involvement in HSRP business fetched much higher rates than those dehors the same, the difference on an average in the offers of the lowest bidder's being Rs. 1000/ - per motor vehicle. The incorporation of these two conditions, therefore, denied the prospect of procuring competitive price(s) for the execution of the project. As the approved test agencies referred to in Rule 50 are possessed of necessary expertise to certify the compliance of the prescriptions thereof and the TAC are issued after subjecting the product to unsparingly rigorous tests, the holders thereof cannot be unreasonably excluded from participating in the process for settlement of the contract of manufacture and supply of HSRP.
55. He admitted that the COP is issued after ascertaining whether the final product adheres to the sample for which the TAC had been issued. The learned Counsel urged that there being no conceivable reason to discredit a holder of TAC as deficient in bidding for the contract, his offer being finally acceptable subject to the scrutiny thereof on the basis of the relevant norms uniformly applicable to all, the impugned tender process is unassailable. Mr. Dutta argued that experience in HSRP business is neither a statutory mandate nor there is any ordained restriction of the eligibility to an entity enjoying foreign collaboration therefor. There being no material on record to even infer at this stage that the State authorities in assessing the tenders would slight the scheme or the purpose thereof or compromise with any essential features of the plates, the challenge is pre-matured and misconceived, he contended. The learned Sr. Counsel argued that as the IFB contains sufficient safeguards pertaining to the experience and financial credibility of a bidder, the petitioner's endeavour to stall the ongoing process is not only frivolous but also lacks bonafide. The learned Sr. Counsel maintained that the appraisal of a bidder need not necessarily be formularistic but objective, based on ground realities and as the IFB guarantees such an evaluation, mere deletion of the Clauses bearing on experience and financial capability relating to HSRP business would not render the process flawed or invalid. The petition is also wanting in factual foundation to substantiate the plea of bias or malafide as alleged, he insisted.
56. Further there being no discernible material suggesting misuse of statutory powers in absence of any particular technology prescribed by Rule 50 or infringement of the said legal provision, the assailment is per se unsustainable, he argued. As the corrigenda enlarges the field of choice on considerations, relevant and germane, this Court acting on the petitioner's paranoia against competition would not interdict a process at its nascent stage in absence of any material to presume that the State authorities would not choose the best for the work involved. Mr. Dutta argued that the Apex Court in Association of Registration Plates, supra, did not recognize any legal requirement of foreign collaboration for prosecuting the project and its determination that the tender conditions therein were not discriminatory does not necessarily make it obligatory for all the subsequent process to obdurately adopt the same regardless of the local conditions and situational exigencies. The learned Sr. Counsel emphasized that the States power of evolving the norms for designing its exercise for the project having been acknowledged in the above decision with the mandate of extra latitude vis-a-vis HSRP scheme, the petitioner's impugnment falls short of the legally comprehended grounds of judicial review and is thus liable to be repudiated.
57. Mr. Mishra, referring to the deliberations in the joint meeting of the States, Union Territories, Central Govt., and the participating manufacturers as well as the guidelines formulated by the Central Govt., in the matter of settlement of contract for manufacture of HSRP plates has persuasively urged that the parameters enumerated therein are only suggestive in nature and it is incomprehensible that those were binding on the State Governments and that too for all times to come. Insisting that the technology of manufacture of such plates is presently available in India and that the technical safeguards in the IFB sufficiently ensure that the tender process accords with the demands of the scheme, the challenge laid is untenable. Not only it is permissible for the State Governments to alter the IFB conditions to appropriately suit its requirements without compromising with the prescripts of the scheme and the purpose of the project, as a matter of fact, many states have in the meantime given a go by to the clause of experience, expertise and exposure in HSRP business as a condition precedent for participation in the tender process.
58. Relying on the instance of the West Bengal Transport Infrastructure Development Corporation Ltd. in SLP (Civil) No. 11621 of 2006, the learned Senior counsel has reiterated that the tender process commenced in the State of West Bengal, sans the condition of experience has drawn much lower rates thereby offering an option to the State to settle for a competitive price to the advantage of the public ultimately required to bear the expenses for the product. The learned Senior counsel has also referred to uproar in the State of Meghalaya against the exorbitant rates on which the contract had been awarded.
59. Mr. Mishra submitted that the noticeable phenomenon being that the tender conditions with experience as an essential condition of eligibility, fetch much higher rates, the impugned corrigenda to facilitate wider competition for competitive bids are in valid exercise of executive discretion according with public interest. The learned Senior counsel submitted that not only the State authorities have a prerogative to determine the tender conditions as has been amongst others recognized in Association of Registration Plates (Supra), the impugned corrigenda neither impinges upon any right of the petitioner nor prevents its participation in the on going process. On the other hand, as the same opens up an uniform plane for all TAC holders to vie for the contract, the assailment is misconceived. The TACs having been approved by test Agencies following vigorous tests of the samples of HSR plates, the holders thereby have been rightly held to be eligible and the petitioner's endeavour to exclude them from the fray is clearly prompted by extraneous and selfish considerations. The learned Senior counsel urged that the Apex Court in the Association of Registration Plates (Supra) did not hold the conditions of experience and financial capacity as essential so as to enjoin incorporation thereof in all tenders relating to manufacture of HSR plates impliedly permitting the States to adopt their own need based stipulations and therefore, the petitioner's contentions based on that judgment are misplaced. Mr. Mishra to reinforce his arguments placed reliance on the following decisions of the Apex Court in Director of Settlements, A.P. and Ors. v. M.R. Appurao and Anr. , Union of India and Anr. v. International Trading Company and Anr. , Global Energy Ltd. and Anr. v. Adani Exports Ltd. and Ors. , State of Orissa and Ors. v. Gopinath Dash and Ors. .
60. Mr. Das, appearing for the Respondent Nos. 8 and 9 while endorsing the above has reiterated that the experience, expertise and exposure clause dwelt upon by the Apex Court in the above decision has not been adjudged to be mandatory for general application in all tender process pertaining to HSRP. According to the learned Counsel that a TAC holder is eligible to contend for the contract has been conceded to by the petitioner. The authority of the State respondents to alter the tender conditions has also not been questioned. Even the guidelines incorporate such a power of the State authorities. The learned Counsel referring to the minutes of the joint meeting and the Central Government guidelines have emphasized that not only all specified vendors are to be treated equal, the main concern as discernible has been to ensure a competitive price. Mr. Das thus maintained that the impugned corrigenda cannot be dubbed and denounced as antithetical to the pronouncement in Association of Registration Plates (supra) as well as the Central Government's guidelines. Moreover, the essentiality of the deposit of Rs. 25 lakhs as earnest money rules out the access of any " Fly by Night Operators", he urged. The learned Counsel argued that the tender conditions amongst others requiring disclosure of the plants and machineries to demonstrate the bidder's equipments capabilities is also a determinative test to assess their competence for executing the project. Mr. Das has reiterated that the impugned corrigenda having been introduced to widen the field of competition on objective considerations, no challenge thereto is entertainable as neither the petitioner has been hindered thereby from participating in the process nor any of its right has been affected.
61. In his reply, Mr. Goswami has underlined that the rival assertions ought to be evaluated in the perspective of developments following the amendment of Rule 50 as well as the background of facts leading to the adjudication in Association of Registration Plates (supra). He insisted that the tender stipulations approved by the Supreme Court therein were for standardizing the same and structuring the discretion of the State authorities in the matter of settlement of contract of manufacture and supply of HRS plates. Though the State authorities have the ultimate choice in selection, but the criteria both for determining the scope of entry, participation as well as the ultimate evaluation have to sub serve the end purpose of the amendment of Rule 50. The negation of the plea based on monopoly, foreign collaboration and denial of indigenous participation is a clear indication of the mandatory nature thereof, he urged. Not only the amendments effected by the corrigenda do away with the original norms bearing on experience, expertise and exposure, no other objective standard to analyze the experience, expertise and capability of the bidders has been enumerated.
62. Mr. Goswami in the alternative, while relenting to the extant that the State authorities may not be totally debarred from departing from the required and essential stipulations of experience, exposure and expertise has assiduously urged that they, however, cannot be absolved of their responsibility of providing a logical, cogent and persuasive justification therefor. The learned Senior counsel maintained that not only every tender process has an element of monopoly depending on the conditions of eligibility prescribed, in essence, in the face of the competition invited thereby, the same recedes to the background. The learned senior counsel rejected the plea of wider competition and competitive price. Asserting that in the face of the fact that even after the amendments only 18 TAC holders would partake in the pursuit, the justifications akin to the one put forward by the State authorities having considered and rejected by the Supreme Court in the above decision, resort to the same is illegal and utterly arbitrary as the factual panorama noticed by it has remained unchanged as on date.
63. The learned Senior counsel maintained that the insistence on the COP as a condition of eligibility would render the petitioner disqualified thus adversely affecting his right to participate in the process. He maintained that the petitioner has a right to fair procedure, more particularly when the same is obligatorily required by the decision of the Apex Court in Association of Registration Plates (supra). He elaborated that the aspect of competitive price did not escape the notice of the Court in that decision but the assertions based thereon did not weigh with it noticing the stringent demand of quality of the plates to be processed. As in the reported decision, the Apex Court took all pains to probe into the facts, tested the tender conditions under challenge and returned a finding that the same were essential, no departure therefrom on the grounds recited is permissible, he argued. Consequently, therefore, Mr. Goswami urged that any State initiating the similar process can ill afford to disregard the ratio of the said decision and any deviation from the essential conditions enumerated therein without any compelling and convincing justification would invalidate the same. Mr. Goswami asserted that a digression can presumably be conceived of in the above premise only if the situation prevalent at the decision in Association of Registration Plates (supra) has undergone a change or if called for on new circumstances to better sub serve the end goal of Rule 50. In the contextual facts, there being none, the impugned process is unsustainable in law, he urged. Following decisions were relied upon by the learned Counsel. Mohinder Singh Gill and Ors. v. the Chief Election Commissioner, New Delhi and Ors. (1978) 1SCC 408, Ramana Dayarama Shetty v. International Airport Authority of India and Ors. Fuzlunbi v. K. Khader Vali and Anr. , Association of Registration Plates v. Union of India and Ors. .
63A. Mr. Dutta answered by contending' that the plea of want of procedural fairness in the facts and circumstances of the case is untenable. He reiterated that considering the issues raised in the Association of Registration Plates (supra), the decision therein is not a binding precedent on the State of Assam under Article 141 of the Constitution of India and the petitioner's case founded thereon is evidently fallacious. He sought to draw sustenance for his submissions from the decisions of the Apex Court in G. J. Fernandez v. State of Karnataka and Ors. , Tata Cellular v. Union of India (1994) 6 SCC 651, Monarch Infrastructure (P) Ltd. v. Commissioner, Ulhasnagar Municipal Corporation and Ors. , Puravankava Projects Ltd. v. Hotel Venus International and Ors. (2007) 2 SCC 532, of the Delhi High Court in Hotel Pradeep and Anr. v. Indian Railways Catering and Tourism Corporation Ltd. AIR 2007 (NOC) 1385 and that of the Calcutta High Court in GA No. 545 of 2006 arising out of W.P. 2083/05, Shimnit Utsch India Ltd. and Anr. v. West Bengal Transport Infrastructure Development Corporation Ltd. and Anr.
64. The debate bearing on the peripheral issues of moment needs to be addressed at the outset. The plea regarding the essentiality of the COP as a condition of eligibility is generated by the amendment to the definition of "Prime Manufacturer" provided in Clause 1.1.21 of the original IFB, dated 07/12/2006. The definition initially illustrated' 'Prime Manufacturer" to mean individual/firm or the corporate entity engaged in carrying out the manufacturing activity of HSRP. The amended definition of the said expression is:
Prime Manufacturer shall mean individual/ firm or the corporate entity engaged in carrying out the manufacturing activity of the HSRP having obtained TAC and conformity of the Production Certificate from a Government authorized agency like ARAL CRRI, VRDE or any one of the testing agency authorized by the Central Government under rule 126 of the Central Motor Vehicle Rules 1989.
65. The amended definition thus demonstratively introduced the necessity of possessing TAC and COP from the recognized Government agencies mentioned therein, to be acknowledged as a prime manufacturer for the bidding process. While the petitioner contends that the requirement of obtaining Conformity of Production Certificate by a prospective bidder is impracticable and unrealistic, such a certificate being issuable only after the commencement of the manufacture of the HSRP, on being awarded the contract, the State respondents in particular, have clarified that such a certificate is not being insisted upon as a prerequisite to qualify a bidder to participate in the process. Noticeably, while referring to the conditions of the eligibility of a bidder enumerated in Clause 1.5 of the IFB the State respondents have emphasized on Clause 1.5.6 to underline the essentiality of the TAC from the testing agencies for the HSRP, as the only peremptory requirement. The definition of 'Bidder(s)\ as provided in Clause 1.1.6 of the IFB, has also been adverted to contend that Bidder (s), means a legal entity including vendor/consortium incorporated as a Company registered under the Indian Companies Act, 1956 and holding a valid TAC from the competent authorities. Noticeably, none of the respondents has disputed the petitioners' assertion that the Conformity of Production Certificate is neither comprehended nor issued before the manufacturing process of the HSRP by a successful bidder commences on being settled with the contract therefor. Though, in the affidavit of respondent No. 4, the deponent therein, has expressed an opinion that such a certificate being "first COP", can be issued prior to the implementation of the HSRP and commencement of regular production, a plain reading of the letter No. RT-11028/5/2002-MVL dated 04.09.2002 of the Ministry of the Road Transport and Highways, Government of India, based on which the view has been offered belies the same. It is instead obvious therefrom that the steps preceding the issuance of the COP certificate, are to be taken after the commencement of production of the HSRP, the first COP to be conducted at the manufacturing plant and the subsequent COPs on the basis of the samples drawn at random from the vendors premises. Clause 4 (xiv) of the Order is further suggestive of the construction hereinabove provided to the contents of the letter dated 04/09/2002. Understandably, therefore, insistence for COP certificate at the bidding stage, in the above premise, would be illogical, insensible and unrealistic. Logically, therefore, the State respondents, have clarified that the COP certificate is not an imperative precondition for participation in the ongoing tender process.
66. The above notwithstanding, it is observable that the amendment to the expression "Prime Manufacturer" as above, was introduced by the corrigendum dated 26.12.2006. The official respondents though, have pleaded that the expression prime manufacturer appears in the IFB only at Clause 1.1.21 of the ITB, Annexure V thereto, dealing with the "Structure and Organization" of the bidder refers to the same expression for eliciting informations about its experience in the manufacture of HSRP in the country and beyond. It is, therefore, incorrect that the expression prime manufacturer finds place only in the definition clause and, therefore, in face of Clause 1.1.2 and 1.5.6 looses all significance vis-a-vis the stipulation of Conformity Production Certificate. This is more particularly, as neither any corrigendum nor any step has yet been taken to either clarify that Conformity of Production Certificate is not a condition of eligibility for the prospective bidders nor any consequential amendment to Annexure V, has been effected. In absence of such elucidation that above provisions of the IFB/ITB project an anomalous and inconsistent facet of the process undertaken, having the potential of misleading the prospective tenderers while offering their bids. The issue does not deserve further dilation in view of the consistent and categorical assertion of the State respondents that the COP would not be construed to be a condition of eligibility.
67. Having regard to the chequered factual background culminating in the adjudication in Association of Registration Plates (supra), endeavours to implement the project in some other States as well as the pending litigations bearing on the deletion of the covenants of experience and business returns in HSRP vendors and as Court orders therein, I do not feel persuaded to dismiss the petitioner's assailment to be lacking in bonafide or to espouse its narrow monopolistic ends. Indubitably, the impugnment if upheld, would constrict the area of the competition but in the face of wholesome objectives of the scheme, the pleaded assertions ought not to be jettisoned on that consideration alone. The plate require to be manufactured, is a highly sophisticated item with complex and intricate features, for the first time introduced in the country and would therefore, demand a high degree of expertise and experience to prosecute and attain the job as statutorily comprehended and ordained.
68. While, mere deposit of Rs. 25 lakhs as the earnest money, cannot be an unfailing assurance against the participation of "fly by night" or unreliable bidders, the facts present a debate demanding an in depth scrutiny of the rival stand points for a judicial resolution thereof.
69. On the date of the institution of the instant proceeding with the amended definition of "Prime Manufacturer" read with Annexure V to the IFB, the petitioner's right of participation was evidently affected as the COP, could not have been produced at that stage. Though, the State respondents, in their affidavit, have assured that such a document is not recorded as a proof of eligibility of a participating bidder, they appear to be oblivious of Annexure V, which seeks to draw information from the prime manufacturer about their experience in the HSRP business. Admittedly no corrigendum has been issued declaring that the COP is not a condition of eligibility and that the expression "Prime Manufacturer" as defined in Clause 1.1.21, is inconsequential qua Annexure V. As one of the key issues to be addressed, is whether the decision in Association of Registration Plates (supra), propounds the conditions of experience and financial reforms in HSRP business are inviolably essential, the instant petition deserves examination on merits and ought not to be thrown over board for want of cause of action. On these considerations, the challenge cannot be repudiated as prematured either.
70. The pleaded facts of the petitioner do not provide any foundation to proscribe the impugned State action to be vitiated by bias or mala fide. The State authorities in their wisdom construing the TAC to be the only enjoinment rendering a bidder to be qualified to participate in the process deleted the originally stipulated conditions of experience and earmarked quota of business returns in HSRP enterprise as determinants of eligibility viewing the Central Government guidelines to be suggestive in nature and the determination in Association of Registration Plates (Supra), as not binding vis-a-vis the covenants as experience and financial returns in HSRP business. The incorporation of such conditions originally in the 1FB and there gradual deletion by the corrigenda admittedly acting on the representation of the TAC holders, who were ineligible in the teeth thereof, ipso facto, do not justify impeachment of the impugned State action to be impaired by bias or mala fide. Having regard to the rigorous legal standards prescribed therefor, any contrary view would be inferential and unfair.
71. The adjudication in Association of Registration Plates (Supra) and the propositions recorded therein in the above backdrop thus act as the lodestar in resolving the present controversy. Both the parties as noticed hereinabove, have relied thereon, to reinforce their own stands. The litigation pertaining to the terms and conditions of Notices Inviting Tenders for supply of HSRP for motor vehicles though originated in various High Courts came to be analyzed and resolved by the Apex Court in that verdict. Initially, the lis was lodged before a Division Bench thereof, but following a divergence of opinions, it was referred to a larger bench following which the decision to be addressed to was rendered. The tenders under challenge as observed hereinabove, had been issued by various State Governments on the guidelines circulated by the Central Government for implementing the provisions of the Motor Vehicles Act, 1988 (hereafter for short referred to as the 'Act') and the Rules. The principal grievance of the petitioners, was that the Notices Inviting Tenders (hereafter for short also referred to as the 'NITs'), had been issued with conditions tailored to favour companies having foreign collaborations and aimed to exclude indigenous manufactures from the related process. The remonstrance registered was also against the proposal to entrust the work of supply of HSRP for all existing vehicles and new vehicles to a single licence plate manufacturer in a State or a region for a long period of 15 years, thus creating a monopoly in favour of the selected bidders to the complete exclusion of all others in the field. Contravention of Article 14 and 19 (1) (g) of the Constitution of India was also asserted.
72. As a preface before embarking on the rival arguments advanced, their Lordships preferred a survey of the related provisions of the Act, the Rule and the Scheme appertaining to the HSRP comprehended in terms of Rule 50. The Court noticed that the object of the new scheme was to curb the increasing menace of vehicle thefts, their usage in commission of murder, dacoity, kidnapping etc. and to check the detailment of motor vehicles in terrorist activities. It took note of the fact that the Central Government on the recommendation of the Technical Committee had devised a system of HSRP to ensure public safety and security. It observed that Rule 50 required manufacture of such registration plates that would be non-reusable and non-replaceable besides making identification of the vehicle and its tracking to be easier and certain with the technical specifications prescribed. It noticed that the other requirements contained in the said Rule apart from regulating the aspect of issuing registration mark with use of specification kinds of letters and numerals, sought to ensure the safety and security of the plate by regulating issuance and fixation thereof, at the premises of the Regional Transport Officer (hereafter also referred to as the RTO) of the area concerned. It noted that the said provision required the RTO to issue the registration number as well as the plate suggesting that the same with specified technical features was to be issued under Governmental control and supervision. It thus opined that the implementation he Rule would require cooperation and cc ii-nation between the authorities of the State and the manufacturer of the registration plates. The main features of the HSRP as identified by the Court from Rule 50 and the Order, are extracted hereinbelow:
1. It provides for a solid aluminum plate.
2. The plate should be suitable for hot stamping and would be a reflective sheet.
3. The plate should bear the letters "IND" in blue colour.
4. It should have a chromium-based hologram, which shall also be hot-stamped.
5. There would be a third registration mark which would be self-reflective being a chromium-based hologram sticker and which would be affixed on the windshield of the vehicle.
6. The plate on the rear shall be fastened with non-removable/non-reusable snap-lock fitting system.
73. The reasons for obligating the above features were also culled out and being instructive are set out hereunder as well:
1. Hot chromium-based hologram would prevent counterfeiting.
2. The ingress letter "IND" on the plate would secure national identity and standardization.
3. The laser-etched seven-digit code to be given by the manufacturer to each plate is with a view that there should be a sequential identification of individual registration plates across the country. This would act as a watermark and would not be erasable by any mechanical or technical process.
4. Snap-lock to be fitted on the rear portions of the vehicle would be temper-proof. Any attempt to remove the plate would break it.
5. The reflective sheet of superior grade would be visible from a minimum of 200 meters.
6. The alpha numeral would be easily readable and identifiable.
7. On alpha numeral border, ingress letters "IND'' would prevent painting and screen printing which would act as protection against counterfeiting.
8. The sticker to be affixed on the windshield would have seven-digit laser code containing the engine number and the chassis number. This is so designed as to be self-destructive upon removal.
74. The Apex Court, while dwelling on the sequence of events following the amendment of Rule 50 and framing of the Order recorded that following a series of parleys between the representatives of all States and Union Territories as well as the Central Government guidelines were formulated for incorporating of necessary conditions in the Notices Inviting Tenders to be issued by the various States. The guidelines in substance were specified as follows:
1. The tender document would specify whether the appointment of the vendor was for the whole State or for certain parts.
2. The tender document would specify the terms of the bank guarantee.
3. The tender document would require a report-back on certain aspects on "a periodic and regular basis.
4. The bidder must furnish proof of past experience/expertise in this area or proof of the same with a collaborator.
75. A meeting of the officials of the Ministry of Road Transport and Highways, Government of India, the representatives of the State and Union Territories and manufacturers of new registration plates was held thereafter on 16.09.2002, following which a clarificatory letter was issued on 13/11/2002, stating that the guidelines were suggestive in nature. On the guidelines given by the Central Government and pursuant to join deliberations between the officials of the Union Territories and the manufacturers, several States issued NITs, which led to the filing of writ petitions in various High Courts, challenging the terms and conditions thereof, and eventually all those were transferred to the Apex Court for decision along with writ petitions directly filed. The Apex Court discerned the following three stipulations in various NITs, which comprised the subject matter of assailment in the petitions under adjudication.
Condition (a) The tenderer/bidder or the promoter or any of the members of joint venture should have sufficient experience in the field of registration plates and should be working at least in five countries for licence plates and in a minimum of three countries with licence plates having security features worldwide (necessary credentials from the Government of such country should be attached along with pro forma as per Annexure XIII duly filled in). Apart from the above credentials the tenderer/bidder should furnish "type approved certificate" from testing agencies. Condition (b).
The tenderers/bidders of the joint venture partners together must have had a minimum annual turnover equivalent to INR 30 crores in the immediately preceding last year. At least 25% of this turnover must be from the licence plate business. Certificate confirming and the certification of this minimum 25% turnover being from licence plate business will have to be provided duly attested by a chartered accountant/any bank to be attached in support of fulfillment of this condition.
Condition (c) The contract will be for a period of fifteen years commencing from the date of commencement of the scheme. A detailed agreement shall be entered into between the successful bidder and the Government for a period of fifteen years and the Government ensures that no second bidder will be approved during the currency of the contract in the State except in the case of termination of the contract in view of the strictest of adherence to high security features and to impose answerability on to the successful bidder.
76. It was urged on behalf of the petitioners, therein that the conditions concerning experience and extent of business were discriminatory and unreasonable as those were designed to subserve business interest of a class of manufacturers having foreign collaboration and form a cartel of Companies. This enjoinment of collaboration of the bidders with a few known foreign companies in the field of manufacture satisfying the stringent eligibility conditions incorporated. It was contended that Rule 50 with its inbuilt safeguards ensure the technical competence of the prospective manufacturer and controlled issuance of registration plates. As manufacture of such plates can be made only on obtaining TAC from one of the autonomous certifying agencies and the supply thereof, permissible only after the grant of COP of the standard of production, there was no jurisdiction of the State to decide or declare any of the manufactures as competent or incompetent with respect to their technical competence.
77. Referring to some of the countries smaller than India, where registration plates with specified security features are in use, it was argued that not only the experience of working therein, with a very small vehicle population could not be comprehended of being of any help as an experience for supplying registration plates for the large vehicle population in India with needs and requirement of far greater magnitude, the insistence therefor, was highly unreasonable resulting in complete exclusion of indigenous manufacturers. It was asserted that indigenous manufacturers of high security plate can manufacture and supply registration plates on their own strength by complying with all standard and inconformity with all norms laid down in Rule 50 without entering into collaboration with any foreign partner. It was sought to be emphasized that by seeking to enforce such conditions in the tender, the existing rights of the manufacturers of plates in India, were being trampelled signifying that though capable of fulfilling the requirements of Rule 50, they were thereby prohibited to do business of manufacturing and supplying the high security plates in violation of their fundamental right under Article 19 (1) (g) of the Constitution. It was urged that the security features for the number plates having been specified for the first time in India, the insistence on experience in 5 countries from the manufacturers, was to eliminate the manufacturers of India though fully competent for implementation of the new scheme of high security plates.
78. Impugning the condition regarding prescribed minimum turn over of business, it was insisted that such a high turn over for a new business was to espouse the interest of a group of Companies having foreign links and support it being impossible for any indigenous manufacture to earn such a turnover from the HSRP sought to be introduced in India for the first time. It was argued as well that the condition of a period of 15 years of the contract was a demonstrative attempt to create a monopoly in favour of one Company or a cartel of companies, which would leave the consumers/vehicle owners at the disposal of a sole successful bidder. The arguments highlighted that if indigenous manufacturers are involved in the implementation of the scheme, the market price of a pair of HSRP, would range between Rs. 800 to Rs. 900, which would stand inflated in case manufactured by joint venture companies with foreign collaboration to not less than Rs. 2000. It was indicated that keeping in view of the large vehicular population in the country, the sole manufacturer was likely to gain a profit of Rs. 2500/- crores in first two years itself.
79. It was replied on behalf of the Union of India that the State Governments were legally competent to formulate an appropriate policy for chosing a sole or more manufacturers in order to fulfill the object of affixation of security plates. It was contended that such a selection could not be said to confer any monopoly right by the State on any private individual or concern and was akin to the selection of an appropriate person for grant of a contract or largesse by the State on laid down criteria of experience and technical qualifications. It was urged that a fair process of selection may eliminate presence of parties, who cannot be found technically financially and on the basis of past experience sound to be awarded the contract.
80. On behalf of the State of West Bengal, one of the parties in the fray, it was argued that the main objective of the competitive bidding process was to ensure that such manufacturers as selected by the State, would be able to comply with the requirements of Rule 50 and, therefore, his capability and capacity to invest and provide the necessary infrastructure has to be assessed so that the scheme becomes operationable from the targeted date and remains unhindered for a long period to achieve the end purpose of the project. While supporting the tender conditions, it was contended that those had been deliberately framed so as to eliminate newly floated companies commonly described as "fly by night companies'', which merely compete to obtain the contract but are devoid of technical or financial capacity to administer the same of such vast dimensions.
81. It was argued further that the tender conditions had been devised bearing in mind the considerations of public interest and high security. As the States are not possessed of requisite resources of their own to implement the scheme, each of those is to search and select a dependable manufacturer, technically and financially sound to conform to the specifications of HSRP. Not only the manufacturer should have a permanent technical partner to the venture to secure the technological support for the entire period of contract, it should also be in a position to upgrade, expand and excel on continuing and sustainable basis.
82. The stipulation relating to 15 years as a contract period was also endorsed to be in public interest, so much so that having regard to the amount of investments to be made for installing the high technology based networking at the RTO's Office, a short term settlement would not attract an experienced and reliable manufacturer. Further, the period prescribed, would ensure against price increase therefor, and thus prove beneficial to the customers against inflation.
83. It was highlighted that the tender conditions had been suitably formulated for performance guarantee, experience and understanding of business, financial strength and capacity of creating and stalling the entire infrastructure and networking. The eligibility criteria were advocated to be commensurate not only with the scale of operation and size of network to be created by the operator but also to ensure that the statutory requirement of the State's obligations to the vehicle owners to deliver the HSRP without any interruption is complied with.
84. On this matrix of facts and the emulous asseverations, the Apex Court in categorical terms held that in view of the enormous work involved in switching over to the new plates regime within two years for the existing vehicles of such large number in each State, resort to trial and error method, would prove hazardous. While acknowledging the State's prerogative to eliminate manufacturers, who have developed recently just to enter into the new field, the Apex Court upheld its (State) insistence to search for an experienced manufacturer with financial and technical capability and observed that the relevant terms and conditions involved were so formulated to enable the State to adjudge the capacity of a particular tenderer, who can provide a failsafe and sustainable delivery commitment. It emphasized that only such a tenderer can be selected, who can take the responsibility of marketing, surveying and continuously supplying plates for vehicles in large numbers, firstly in the initial two years and annually in the next thirteen years. It recognized the manufacturer chosen to be a sort of agent or medium of RTOs concerned for fulfillment of the statutory obligation on them of providing high security plates to vehicles in accordance with Rule 50. It held that capacity and capability are the two most relevant criteria for framing suitable conditions of any Notice Inviting Tenders.
85. Referring to the impugned clauses requiring the tenderer individually or as a member of a joint venture to have experience in the field of registration plates in at least three countries and a common minimum net worth of Rs. 40 crores and a minimum annual turnover 50 crores with a minimum of 15% from registration plate business, their Lordships viewed the same as essential conditions to ensure that the manufacturer selected would be technically and financially competent to fulfill the contractual obligations, which looking into the magnitude of the job required huge investments qualitatively and quantitatively.
86. The Apex Court placed on record that it was not in dispute that the technical know how for the HSRP, was outside the country and that though, there are many tenderers, who possessed TACs in order to ensure the major quantity of supply in the initial two years and a periodical supply for new vehicles for a long period, only a manufacturer, which is sound both technically and financially would be required. It noticed that technically and financially competent indigenous manufacturers are mostly those, who are collaboration with foreign companies engaged in such activities and, therefore, concluded that the scheme under Rule 50 being a new experiment for India, at the initial stage of its implementation, tender conditions encouraging such manufacturers, who are in foreign collaborations cannot be impeached as discriminatory to indigenous manufacturers. Keeping in view the nature of the contract and job involved, particularly its magnitude and the huge investment for infrastructure required, the attempt to select such manufacturer having collaboration with foreign companies and experience therein, could not be held to be a deliberate attempt on the part of the State authorities to eliminate indigenous manufacturers.
87. In this context, the Apex Court reiterated that in the matter of formulating conditions of a tender document and awarding contract of the nature of ensuring supply of HSRP, greater latitude is to be conceded to the State authorities and that unless the action of the tendering authority was found to be malicious and in misuse of its statutory power, tender conditions were unassailable.
88. With regard to the clauses requiring experience in the field of supplying registration plates and the quantum of business turnover, it negated the plea that those are intended to keep indigenous manufacturers out of the field. The respondents' affirmation that on the date of formulation of the scheme in Rule 50 and issuance of guidelines thereunder, by the Central Government, there were not many indigenous manufacturers in India with the technical and financial capability to undertake the job of supply of such high dimension on a long term basis was also noticed. The covenant to select one manufacturer for the supplies was also sustained on the consideration that a huge investment would be required towards the infrastructure by the selected manufacturer and though the major return would be expected in initial period of two years, he would be bound to render his service for future vehicles periodically for a long period.
89. Keeping in view the huge investment required and the nature of the job, which was most sophisticated requiring a sound network and infrastructure for a long-term contract, such stipulation was unassailable, it held. The Apex Court ruled that a contract providing for technical expertise, financial capability and experience qualifications with a long term of 15 years would serve the dual purpose of attracting sound parties to stake their money in undertaking the job of supply and also safeguard the public interest by ensuring that for a long period so that the work of affixation of security plates would continue uninterrupted in fulfillment of the object of the scheme. It also took into account the fact that the terms of the tender prescribing the quantum of turnover of business in plates with a long term period of contract had been incorporated to ensure uninterrupted supply of plates to a large number existing vehicles within a period of 2 years and new vehicles for a long period in coming years. The plea of creation of monopoly in favour of parties having foreign collaborations was also dismissed as without substance observing that selection of a competent contractor for assigning the job of supply of a sophisticated article through a open tender process cannot be an act of creating monopoly. The Apex Court thus upheld the impugned clauses in the tender conditions and expressed that merely because a few manufacturers like the petitioners, did not qualify to submit the tender being not in a position to satisfy the terms and conditions laid down, the same could not be held to be discriminatory.
90. Reading between the lines, the determination as above, in my view, cannot be limited in its essence, purport and amplitude as a response simpliciter to the assailment before the Apex Court and the resolution of the issues before it with no general overtones vis-a-vis, the identical process in comprehension as well as in progress in other States. Indubitably, any tender process for selecting a manufacturer for the HSRP, as dealt with in the aforementioned decision, would have to be conceived of in the background of the same legal provisions, scheme and the guidelines and the objectives. Though, admittedly, their Lordships have not spelt out explicitly that the propositions enunciated would be applicable to all tender process to implement the scheme founded on Rule 50 and clause 4 of the Order, it is perceptibly discernible from the narration and the reasonings preceding the various conclusions. Significantly all the contentions raised in the instant proceeding on behalf of the respondents, in substance have been exhaustively dealt with by their Lordships eventually to be rejected. The decision as required, was oriented on the impugnment projected and while sustaining the tenders stipulations under challenge, the Apex Court reiterated the oft quoted proposition acknowledging the authority, dominion and discretion of the State and its functionaries in designing the tender nonns, countenancing greater latitude vis-a-vis HSRP. This observation, however, in my estimate, cannot be understood to be an unreserved relaxation in favour of the State to pattern tender provisions to evidently depart from the basal framework and the salient features approved, consented and recited in the Central Government guidelines, for the due attainment of the objectives of Rule 50 and the Order as well as the reasoned findings on merit recorded by the Court.
91. The Apex Court while assaying the rival assertions did not leave the contentious issues unanswered recognizing the prerogative and discretion of the State authorities in formulating the same but on an exhaustive appraisal thereof, sustained the impugned tender conditions. It noticed that though, the guidelines were regarded as suggestive in nature, the same inter alia insisted on the proof of past experience/expertise in the manufacture of HSRP. The tender conditions culled out for its scrutiny formed the quintessence of the scheme to further the objective of Rule 50. The plea of imminent exclusion of the indigenous manufacturers, and promotion of the business interest of a group of companies having foreign collaborations, was comprehensively dealt with. The aspect of difference in the price of manufacture of the plates in both the contingencies, did not escape its notice. That the tender conditions were formulated, keeping in mind the public interest and the aspect of high security and that the manufacturer was essentially required to have a permanent technical partner, to ensure technological backup for the entire period of contract also weighed with it in sustaining the assailed covenants.
92. Resort to trial and error method was categorically held to be hazardous in the face of the magnitude of the work and the challenges posed by it. It thus underlined that the terms and conditions so formulated were to enable the State to appreciate the competence and capability of a particular tenderer to guarantee sustainable and uninterrupted delivery of the plates on long-term basis. The prescription of experience in the field of registration plates in at least three countries and a minimum turnover in such business was held to be essential conditions to make sure that the selected manufacturer would be technically and financially equipped to satisfy the contractual obligations, which having regard to the massive frame of the work demanded huge investment qualitatively and quantitatively. The Apex Court was unambiguous in concluding that a contract demanding technical expertise, financial capability and experience, with a long term of 15 years, would serve the dual purpose of attracting sound parties to invest their money in undertaking the job and supply and safeguard the public interest by ensuring uninterrupted delivery of security plates in the fulfillment of the job of the scheme generated by Rule 50. In arriving at this conclusion, the Apex Court was not unmindful of the existence of many tenderers, who possessed TACs but held the view that to ensure the supply of such vast quantity of security plates in the initial two years and continued delivery thereof thereafter for the new vehicles for a long period, selection of a manufacturer, who was sound both technically and financially, is an imperative necessity.
93. To wish away these determinations as the yield of adjudication limited to the contextual facts alone, would be a misconstruction of the renderings denying the same their due significance, import and connotations in obvious disregard of the pronounced background of the underlying objectives of the amendment of Rule 50, the scheme to further the same, the uniqueness of the product involved, the intervening developments as well as the supervening public interest, I am, therefore, of the unhesitant opinion that the conditions of experience and business turnover visa-vis a tender process pertaining to HSRP for implementation of the scheme furthering the objectives of Rule 50, have been held to be essential by the Apex Court in Association of Registration Plates (Supra). The findings are categorical determinate and unambiguous and do not admit of in my opinion any other deduction. The decision, therefore, has an all permeating application to all such tender process.
94. While elaborating on the aspect of judicial discipline in obeying precedents, the Apex Court in Fuzlun Bi (Supra), held that vis-a-vis a pronouncement by it that no judge in India except a larger Bench of the Supreme Court can whittle down or be unbound by the ratio thereof. It held that the discipline of law, the due process of law and the rule of law, would become mere claptrap, if judges bound by such a decision chose to disregard the same on untenable alibi. The following paragraph therefrom is extracted as hereunder:
Glanvile Williams in his LEARNING THE LAW, gives one of the reasons persuading judges to distinguish precedents as "that the earlier decision is altogether unpalatable to the court in the later case, so that the latter court wishes to interpret it as narrowly as possible". The same learned Author notes that some judges may in extreme and unusual circumstances, be ap tto seize on almost any factual difference between this previous case and the case before him in order to arrive a different decision. Some precedents are continually left on the shelf in this way, as a wag observed, they become very "distinguished". The limit of the process is reached when a judge says that the precedent is an authority only "on its actual facts.
We need hardly say that these devices are not permissible for the High Courts when decisions of the Supreme court are cited before them not merely because of the jurisprudence of precedents, but because of the imperatives of Article 141.
95. In Dr. Thadani v. Union of India and Ors. (Supra), the challenge laid before the Delhi High Court principally asserted absence of rule making power of the Central Government in the matter relating to fixation of High Security Registration/Number Plates. Dismissing the petition, it was held that judicial notice could be taken of the fact of increase in the theft of car and commission of several offences by using forged number plates. Having regard to the recent spurt of terrorism for which extra security as regard identification of cars, has become all the more necessary, the contention that the implementation of the scheme would entail extra expenditure of the State was rejected as irrelevant. It was observed further that the hardship of an individual or a group of individuals cannot be a ground to strike down an otherwise validly enacted statute or rule. The Court noticed that the purport and object of the amendment in the Rules was to ensure against the change in the registration/number plates or tampering thereof and that the new High Security Registration/Number Plates, was conceived of to sub serve the said purpose. This view as well in substance aligns with the basic premise that informs the decision in Association of Registration Plates (Supra).
96. The contention that the terms of a tender being in the realm of contract is beyond judicial review unless arbitrary, discriminatory, mala fide or biased and that the State authorities have discretion to formulate the same to suit the demands of their purposes in the unique background of the present case, does not merit acceptance. In that view of the matter, the decisions of the Apex Court in M/s. Puravankar Pproject Ltd., Directorate of Education and Ors. (Supra), Global Energy Limited and Anr. (Supra), Tata Cellular (supra), G J. Fernandez (supra), Monarch Infrastructure (P) Ltd. (supra) and that of the Delhi High Court in M/s. Hotel Pradeep and Anr. (Supra), have no application in the instant proceeding. These decisions, which in substance propound the above proposition thus being of no consequence in the face of the deduction made hereinabove, are therefore, not being dilated upon for the sake of brevity.
97. That by the corrigenda, the criteria of experience and turnover in HSRP business as originally incorporated in the IFB, have been deleted, is evident. By the corrigendum dated 26/12/2006, amongst others the definition of "Prime Manufacturer", had been amended and the requirement of securing at least 50% marks out of 160 marks with the apportionments as specified in Annexure XIII to the IFB representing the experience record was dropped. The corrigendum dated 06/01/ 2007, was more effacing, whereby the enjoinment of experience in the works relating to HSRP as referred to Clause 1.2.3, objective of bidding process, Clause 1.5.3, 2.20.1.3 and Annexure XIII as well as the edict of 15 % turnover from registration plate business embodied in Clause 1.5.5, were deleted. By the communication/corrigendum dated 16.01.2007, Clause 2.3.6, incorporating the precept of 15% of the business turnover of a bidder from the registration plate business consequently, was also deleted. The tender conditions were thus clipped off the clauses demanding disclosure of particulars regarding experience of a bidder in manufacture business of HSRP and turnover there from.
98. This palpably is a digression, which flies in the face of the decision in Association of Registration Plates (Supra), prohibiting such a course. Tested from the viewpoint that the Apex Court's pronouncement notwithstanding the State of Assam on the singular facts and circumstances prevalent in the area and its distinctive exigencies can permissibly do away with the conditions of experience and business turnover in HSRP also, the impugned action cannot be upheld on the materials available on record. Not only, the State respondents have omitted to plead that the technology of manufacture of the HSRP is presently available in India, the other respondents do not claim to have the required experience and business commitment in the said field of activity. The policy decision as claimed by the State authorities, which expectedly has preceded the issuance of the corrigenda, is also not on record. Irrefutably, the contract to be awarded has inherent features and cannot be equated with any other government contract with different attributes. The avowed objective of the scheme in introducing the HSRP is principally for prevention of crimes so much so that the product needs to embody high security features to prevent counterfeiting and duplication thereof, demanding unquestionable experience, expertise and exposure of its manufacturers. Given the sophisticated and complex technology involved, past experience in this area of enterprise is of cardinal relevance.
99. Considering the strategic location of the State of Assam and the escalating menace of terrorist activities and crimes/offences threatening public safety and the security of the State, strict adherence to the essentialities of the scheme ought to be the solemn obligation and mandatory commitment lest the objectives of Rule 50, be frustrated. The reasons in support of the corrigenda are conceptually not different from the corresponding plea? advanced on behalf of the petitioners in Association of Registration Plates (Supra) and dismissed by the Apex Court on due consideration. These, therefore, do not project grounds emanating from facts and circumstances distinguishable from those as obtained at the adjudication in that case. The rationale behind the corrigenda assigned by the State respondents also do not promise better implementation of Rule 50 to approve the deletion of the needfulness of the criteria of experience and business turnover in the manufacture of HSRP. The assertion of the respondents that these stipulations are inessential is thus unconvincing. In the opinion of this Court, the tender conditions as exist following the aftermath of the corrigenda display an elasticity in the process to accommodate a trial and error course strongly discountenanced by the Apex Court. Having regard to the definitive bearing of the post Rule 50 amendment developments on the process any relaxation of the criteria of experience and business turnover in the manufacture and sup-ply of HSRP sustained, have to be justified by reasons persuasively cogent, convincing and potent, even if held to be permissible in recognition of the States power to devise its tender conditions in face of the judicial determination by the Apex Court.
100. Rule 50, does not definitively and conclusively lay down the TAC to be the only condition of eligibility so as to unassailably entitle a manufacturer in possession thereof, to participate in a process concerning manufacture and supply of HSRP, as a matter of right. Had it been so, the representatives of the Central Government, States and the existing manufacturers would not have engaged themselves in protective discussions and deliberations to concur on guidelines enumerating other qualifying criteria for a intending bidder. The possession of a TAC therefore, was thus not considered enough by the Apex Court, considering the magnitude of the project to be undertaken and the uncompromising needfulness of unhindered supply of plates on a long term basis. ATAC therefore, was not construed to be an unassailable index of the holder's experience in HSRP business.
101. The plea based on competitive price thus fade into insignificance considering the critical objectives of the scheme and the ensuing benefits to the public at large if implemented as expected. In any case the consideration of a competitive price is unacceptable at the cost of the quality of the plates and the end purpose in view. Insistence on experience and business turnover in the manufacture and supply of HSRP is further on assurance of consistency in approach of all the States that would auger well for the attainment of the legislative intendment embodied in Rule 50.
102. The Apex Court in Union of India and Anr. v. International Trading Co. and Anr. (Supra), while dwelling on the prerogative of the Government to formulate its policies held that though the same is wide enough, it has to, even in contractual matters essentially satisfy the tenet of reasonableness, fairness and non-arbitrariness, it being the constitutional guarantee enshrined in Article 14. It was of the view that a State action is amenable in the panorama of judicial review only to the extent that it must act validly for a discernible reason and not whimsically for any ulterior purpose.
103. Though, the materials available do not proclaim unequivocally that the impugned action had been actuated by malice, it is conspicuously incongruent with the initial approach and comprehension evinced by the original tender conditions. The State respondents in the IFB dated 07.12.2006, had duly engrafted the clauses pertaining to experience and business turnover in the manufacture and supply of HSRP as peremptory conditions of eligibility, which admittedly they meandered from solely acting on the representation of ineligible Typed Approval certificate holders. The deletion of the stipulations regarding experience and business turnover apparently is in the teeth of the decision in Association of Registration Plates (Supra), the conclusions recorded wherein, could not have been disregarded by the State authorities. As observed hereinabove, the justifications put forward do not either respond to the underlying objectives of Rule 50 and the Scheme prepared to effectuate the same or satisfactorily provide an acceptable logic based on updated circumstances or grounds not raised or analyzed in course of the judicial determination in the said pronouncement.
104. The rule of administrative law judicially evolved as a check against exercise of arbitrary power by the executive authority, was reiterated by the Apex Court in Ramana Dayaram Shetty (Supra), enunciating that the State need not enter into a contract with any one but if it does so, it must do fairly without discrimination and without unfair procedure. It proclaimed that the power and discretion of the Government in the matter of grant of largesse including award of jobs, contracts, quotas, licenses etc. must be confined and structured by rational, relevant and non-discriminatory standards or norms and if the Government strays from such standards or norms in any particular case or cases, the action would be liable to be struck down unless it can be shown by the Government that the departure was not arbitrary but was based on some valid principle, which in itself is not irrational, unreasonable or discriminatory. The impugned State action fails to conform to this profound dictum adumbrated hereinabove.
105. As the corrigenda assailed in the opinion of this Court, are in disregard of the ratio decidendi in Association of Registration Plates (Supra), those are in breach of the process envisaged in terms of the said decision and is thus actionable at the instance of the petitioner as observed by the Apex Court in Mohinder Singh Gil (Supra). The Apex Court in Association of Registration Plates (Supra), having recognized and sustained the conditions of experience and business turnover in the manufacture and supply of HSRP, every prospective tenderer has a right to insist for a process in harmony therewith.
106. In the above premise, the pronouncement of the Apex Court in Directorate of Settlement, A.P and Ors. (Supra), enjoining the edict of existence of a legal right of the person aggrieved as a prerequisite to seek a writ of mandamus for the enforcement thereof, is of no avail to the respondents.
107. For the reasons mentioned hereinabove with respect, I am unable to subscribe to the view expressed by the Calcutta High Court in Shimnit Utsch India Ltd. and Anr. (Supra) vis-a-vis the decision rendered in Association of Registration Plates (Supra).
In the result, I find sufficient force in the petition, which therefore, is allowed. The impugned tender process in the form as it stands today, being opposed to the letter and spirit of the pronouncement of the Apex Court in Association of Registration Plates (Supra), is hereby adjudged illegal, unconstitutional, null and void and is non est in law. No costs.