Kerala High Court
M/S.Abg Cements Ltd vs The Cochin Port Trust on 3 March, 2012
Author: P.R. Ramachandra Menon
Bench: P.R.Ramachandra Menon
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR.JUSTICE P.R.RAMACHANDRA MENON
FRIDAY, THE 12TH DAY OF APRIL 2013/22ND CHAITHRA 1935
WP(C).No. 3590 of 2013 (W)
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PETITIONERS:
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M/S.ABG CEMENTS LTD., AGED 62 YEARS
BHUPATI CHAMBERS, 5TH FLOOR, 13
MATHEW ROAD
MUMBAI-400 004 REPRESENTED BY ITS POWER OF
ATTORNEY HOLDER CAPTAIN ALEX ANTONY
AGED 62, S/O ANTONY MATHEW MIG 395, PANAMPILLY NAGAR
COCHIN-682 036.
BY ADVS.SRI.DINESH R.SHENOY
SRI.G.HARIKRISHNAN (TRIPUNITHURA)
SRI.R.V.RAHUL
RESPONDENT(S):
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1. THE COCHIN PORT TRUST,
COCHIN-682 009, REPRESENTED BY THE SECRETARY.
2. THE CHAIRMAN,
COCHIN PORT TRUST, COCHIN-682 009.
R1 & 2 BY ADV. SRI.M.GOPIKRISHNAN NAMBIAR
R1 & 2 BY ADV. SRI.P.GOPINATH
R1 & 2 BY ADV. SRI.P.BENNY THOMAS
R1 & 2 BY ADV. SRI.K.JOHN MATHAI
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON
12-04-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
WP(C).No. 3590 of 2013 (W)
APPENDIX
PETITIONER'S EXHIBITS:
EXHIBIT P1: TRUE PHOTOCOPY OF NOTIFICATION PUBLISHED IN MALAYALA
MANHORAMA DAILY DATED 3.3.2012.
EXHIBIT P2: TRUE PHOTOCOPY OF ORDER DATED 9.5.2012 ISSUED BY THE 1ST
RESPONDENT.
EXHIBIT P3: TRUE PHOTOCOPY OF THE CORRIGENDUM ISSUED BY PORT TRUST.
EXHIBIT P4: NEWSPAPER REPORT IN THE MALAYALA MANORAMA DAILY DATED
10.5.2012.
EXHIBIT P5: TRUE PHOTOCOPY OF THE NOTIFICATION IN MALAYALA MANORAMA
DAILY DATED 20.9.2012.
EXHIBIT P6: TRUE PHOTOCOPY OF THE TENDERING DOCUMENTS AND ALL ANNEXURES.
EXHIBI P7: TRUE PHOTOCOPY OF LETTER DTED 19.12.2012 ISSUED BY THE
PETITIONER.
EXHIBIT P8: TRUE PHOTOCOPY OF LETTER DATED 26.12.2012 (SERVED ON
3.1.2013.).
EXHIBIT P9 TRUE PHOTOCOPY OF A COMPARATIVE STUDY BETWEEN THE SITES
ALLOTTED TO M/S. ZUARI CEMTNES AT Q-5 ERNAKULAM WHARF AND TO THE LAND
SITUATED ON THE NORTHER SIDE OF THE MATTANCHERRY WHARF TENDERED IN
COPT TENDER NO.EM/T/40/CEMENT STORAGE -IV/2012 DATED 20.09.2012 AND A
COMPARATIVE CHART OF EARNING TO THE COCHIN PORT TRUST OF Q5 BERTH AND
THE MATTANCHERRY WHARF.
/TRUE COPY/
P.S. TO JUDGE.
P.R. RAMACHANDRA MENON, J.
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W.P. ) No. 3590 OF 2013
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Dated this the 12th April, 2013
J U D G M E N T
Rejection of Ext.P6 Tender, inspite of quoting higher bid amount than the remaining bidder ( who happened to be disqualified for not submitting the EMD, leaving the petitioner as the sole valid tenderer) and the cancellation of Ext.P5 Tender notification vide Ext.P8, is the dispute raised in this writ petition.
2. Ext.P5 Tender was floated by the first respondent for leasing out 3.19 hectares of land to the north of Mattancherry Wharf in Willingdon Island for setting up facilities for handling bulk cement and allied cargo and bagging plant. The lease was for a period of 'thirty' years and the mode of allotment was by way of 'Tender cum Auction'. The petitioner and M/s. Malabar Cements Ltd.(who has not been included in the party array) were the only participants in the Tender proceedings.. The case of the petitioner is that, the particular Berth, which is the subject matter of Tender, is in fact to be developed by the successful bidder spending a huge amount, as part of the BOT (Build, Operate and Transfer) arrangement and on expiry of the W.P. ) No. 3590 OF 2013 2 tenure, the entire infrastructure will stand handed over to the respondent/Cochin Port Trust. The petitioner satisfied all the requirements specified for Tender No.EMT/40/CEMENT STORAGE- IV/2012 in Ext.P6 and stood far above the other contestant viz. M/s.Malabar Cements. According to the petitioner, with intent to extend undue advantage to M/s.Malabar Cements Ltd., the better offer placed by the petitioner has been simply rejected without assigning any reason, which is contrary to the law declared by the Hon'ble Supreme Court, on the point and hence under challenge.
3. The respondents have filed a statement, pointing out that there is absolutely no basis for the allegations levelled against the respondents and that, by cancelling the Tender, no undue advantage is extended to the other tenderer, M/s. Malabar Cements Ltd. It is pointed out that the Net Present Value (NPV) offered by the petitioner was approximately Rs. 56.90 crores, whereas the NPV in the case of M/s. Malabar Cements was only Rs. 26.86 crores. On adding these amounts to the premium quoted, the total figure offered by the petitioner came W.P. ) No. 3590 OF 2013 3 to be Rs.58.40 crores; whereas the figure in respect of M/s.Malabar Cements was only Rs.49.86 crores. It is true that the total amount offered by the petitioner was higher than that of M/s.Malabar Cements. But, since the amounts offered by both the contestants were much below the 'reserve price/base price' fixed in terms of the 'Land Policy' for the Major Ports evolved by the Government of India, (Ministry of Shipping), the Tender Committee had no other alternative, but to recommend 'Discharge of the Tender', thus leading to Ext.P8 communication. Reliance is sought to be placed on Clause 13 (Section 2- Instructions to Tenderers), which clearly stipulates that the Port Trust does not bind itself to accept the highest One Time Non- refundable Premium or any other Tender and reserves the right to accept any Tender in part or to reject any Tender or all Tenders without assigning any reasons whatsoever.
4. Mr. Dinesh R. Shenoy, the learned Counsel for the petitioner submits with reference to the materials on record that this is the second time, that the respondent Cochin Port Trust is pursuing such cancellation of Tender so as to oust the petitioner W.P. ) No. 3590 OF 2013 4 from the field, for extraneous reasons. It is stated that the respondents are having two different Berths to be operated as Cement Terminals and both were sought to be leased out for long tenure. In respect of Plot No.2, the respondents had invited Tender and the petitioner as well as M/s. Malabar Cements Ltd. participated in the bid. After submitting the Tender, they were invited to the second stage of oral auction . In the course of further steps, it was brought out that M/s. Malabar Cements had not fulfilled the mandatory requirement of furnishing Earnest Money Deposit and hence, they were disqualified. Since the petitioner Company had fulfilled all the terms and conditions, the petitioner's bid ought to have been accepted. But the Tender itself was simply cancelled without assigning any reason and without even inviting the petitioner for any negotiation. Anyhow, the petitioner did not choose to challenge the same, as a new Tender was floated for the very same plot (Plot No.2) on 22.05.2012. This time, some modifications were made allegedly to cater to the needs and requirements of parties like M/s. Malabar Cements, who could not satisfy the terms in the earlier W.P. ) No. 3590 OF 2013 5 round. The petitioner also participated in the Bid and ultimately, the above Plot having an extent of 2.4 hectares of land came to be allotted to M/s. Zuari Cements Ltd., who quoted a higher amount than the petitioner.
5. Plot No.1 (North of Mattancherry Wharf having an extent of 3.19 hectares ) was notified as per Ext.P5 Tender Notification dated 20.09.2012. The petitioner as well as M/s. Malabar Cements Ltd., were in the field. According to the petitioner, some modifications were effected in the Tender conditions so as to suit to the convenience of M/s.Malabar Cements Ltd. The Technical Bid was opened on 30.11.2012 and both the Companies got qualified to participate in the oral auction to be held on 11.12.2012 . According to the petitioner, the total value offered by the petitioner was to the tune of Rs.58.4 Crores, while that of M/s. Malabar Cements Ltd., was only Rs.49.87 crores. Inspite of the higher amount offered by the petitioner, the bid proceedings were not finalised by the respondents and the petitioner requested to have the Tender finalised in their name by sending an E-mail on 03.01.2013. In W.P. ) No. 3590 OF 2013 6 the meanwhile, the petitioner was served with Extr.P8 letter dated 26.12.2012 informing that the petitioner's Tender was being 'discharged'; simultaneously asking for the particulars of the Bank Account of the petitioner for arranging 'e-payment' in respect of the money (EMD) to be returned to the petitioner. The learned Counsel submits that, this is nothing but an arbitrary exercise of power, which is liable to be intercepted by this Court and that the petitioner is having every right to have the Tender finalised in their name. It is stated that there is absolutely no basis for rejecting the Tender referring to fixation of 'reserve price" for the land, which is kept as 'secret' by the respondents . It is also pointed out that, there is a duty for the respondents to have the same published, instead of keeping the same secret in a sealed cover. With reference to the contents of the reply affidavit filed by the petitioner, the learned Counsel tried to establish that the final figure offered by the petitioner in respect of the particular Berth, though having an extent of 3.19 hectares, is quite substantive in view of the huge investment to be made by the petitioner in order to construct the Wharf and to W.P. ) No. 3590 OF 2013 7 provide necessary infrastructure, which was not necessary in respect of Plot No.2, as there is already a ready made and fully functional Wharf and such other facilities in the said property consisting of an an extent of 2.4 hectares, Tender for which was finalised in the name of M/s. Zuari Cements Ltd., for a sum of Rs.80,75,00,000/-
6. Mr. P. Gopinath Menon, the learned Standing Counsel for the Cochin Port Trust submits that there is no vested right for the petitioner to contend that the Tender has to be finalised in the name of the petitioner for having offered higher amount than that of the remaining tenderer; more so when the said amount is less than the 'reserve price' fixed by the Tender Committee. It is also stated that the 'reserve price' has been fixed as per the norms evolved and let known by the Ministry of Shipping, with reference to the extent of land involved and considering such other relevant criteria. This was kept as secret with a view to avoid forming a cartel in the bid proceedings . The evaluation of the Tender has been described in the Tender documents; particularly under Clause 1.7 of Section 2 of Ext.P6 and there is W.P. ) No. 3590 OF 2013 8 no challenge against the said same or the process of evaluation. It being the property of the respondents, it is for them to decide whether the property has to be leased out for the amount quoted by the bidder. If the amount quoted is not up to the level of expectation, it is always open for the respondents to reject the Tender and go for a fresh exercise for procuring more revenue. The learned Counsel further submits that the proceedings pursued by the respondents are transparent in all respects, as discernible from the contents of the File placed for consideration of this Court, to arrive at a finding on merit.
7. The evaluation of bids is stated to be on the basis of one time non-refundable premium (as per Tender/Auction, whicheer is higher) and the NPV (Net Present Value) to be worked out, as prescribed. The petitioner quoted Rs. One Crore towards one time non-refundable premium in the Tender documents, while a sum of Rs.1.5 crores was offered at the time of 'Auction'. M/s.Malabar Cements Ltd., quoted a sum of Rs 23 crores as one- time non-refundable premium in the Tender documents and they did not offer any other figure at the time of 'Auction'. On W.P. ) No. 3590 OF 2013 9 evaluation of the 'Minimum Guaranteed Throughput' (MGT) quoted as above, the Net Present Value (NPV) of the petitioner turned out to be of Rs. 56.90 crores, whereas in respect of M/s. Malabar Cements Ltd., it was Rs.26.86 crores. On adding these figures to the former figures, the total output in respect of the petitioner came to be Rs.58.40 crores; while in respect of M/s. Malabar Cements Ltd., it was Rs.49.86 crores. According to the respondents, both these figures were much below the 'reserve price' fixed in terms of the Land Policy and in turn, the Tender Committee decided to recommend 'Discharge of the Tender' and the same was let known to the petitioner as per Ext.P8.
8. It is settled law, that mere incorporation of a clause that Tender can be cancelled for any reason whatsoever, cannot give any unbridled power to the Authority issuing the Tender to pursue any arbitrary exercise and that proper reason has to be there, for cancellation of the Tender. In the instant case, the reason is that the amounts quoted by the two participants in the field were much below the 'reserve price' fixed by the Tender Committee. By virtue of the terms of the Tender and the process W.P. ) No. 3590 OF 2013 10 of evaluation, the final figures could be worked out only after completing the different levels of assessments including oral auction and when the final figures were worked out, the same happened to be less than the 'reserve price' and hence the Tender had been rejected.
9. The only question to be considered is whether any arbitrary exercise has been pursued by the respondents or whether there is any material irregularity in the 'decision making process'. Going by the pleadings and proceedings, there cannot be any doubt or dispute that the Tender in respect of the property to be leased out is for a long term and it is for the Authority issuing the Tender, to decide whether the amount quoted by a particular bidder, though it be the highest among the participants, is to be accepted, if it did not come to the level of their expectation. Various factors have to be considered, so as to protect /generate revenue in respect of the Tender and all these aspects have been considered by the Tender Committee who has fixed the 'reserve price'. This Court does not find any force in the contention raised by the petitioner that the 'reserve W.P. ) No. 3590 OF 2013 11 price' should be revealed to the participants well in advance and that the petitioner can be said as aggrieved only if the Tender happens to be finalised in favour of somebody else, who has quoted a price less than that the one offered by the the petitioner in the re-Tender conducted subsequently.
10. In the light of the pleadings and materials as aforesaid, this Court finds that the course pursued by the respondents cannot be said to be tainted in any manner . The case has been moulded by the petitioner mainly pointing out that, undue advantage has been extended to M/s. Malabar Cements Ltd. Admittedly, M/s.Malabar Cements Ltd., quoted only much lesser amount than the petitioner and as such, in what way, cancellation of the Tender has resulted in any 'advantage' to M/s. Malabar Cements Ltd., is a matter which is not known. On the other hand, the attempt of the respondents is only to procure more fund/value for the property to be leased out. This Court has also gone through the contents of the File produced by the respondents before this Court. No incriminating circumstance is revealed therefrom.
W.P. ) No. 3590 OF 2013 12
11. The limited question that is coming up for scrutiny before this Court is the defect, if any, in the 'decision making process'. The comparative figures in respect of the virtues in relation to Plot No.1 involved herein and Plot No.2 already auctioned in favour of M/s. Zuavari Cements Ltd., sought to be explained by the petitioner in the reply affidavit, do not deserve to be analysed or appreciated, as the comparative data in this regard is not a relevant factor at all. The point is whether the amount quoted by the petitioner is adequate enough or acceptable to the Authority who floated the Tender. This being less than the 'reserve price' fixed by the Tender Committee, this Court does not find it necessary to venture into any such exploratory analysis, as to the plus and minus points of two different plots subjected to Tender by way of two different Tender notifications.
12. As mentioned hereinbefore, the vital aspect to be considered is, whether the 'decision making process' pursued by the respondents could be held as arbitrary in any manner, in rejecting the petitioner's offer as per Ext.P8 and going in for re- W.P. ) No. 3590 OF 2013 13 tender. It is true that, by virtue of the relevant Clauses of the Tender conditions, the respondent Port Trust does reserve the right to reject the Tender even without assigning any reason. The stand of the respondents is that, the offer made by the petitioner was far below the 'reserve price' fixed by them, which was kept in a sealed cover and was never published. In the course of auction proceedings, the petitioner had made it clear that the petitioner was ready to satisfy the 'base price', if any, as discernible from the video recordings of the proceedings. In spite of this, the petitioner's offer was not accepted and the 'reserve price' was never revealed, which according to the learned Counsel for the petitioner is an arbitrary exercise of power.
13. It is settled law that the bidder does not have any indefeasible right to have his Tender accepted merely for being the highest one. But by virtue of the law declared by the Apex Court in Star Enterprises v. City & Industrial Dev. Corpn. Ltd. (1990 (2) KLT 37), judicial review of administrative action has become expansive and is becoming wider day by day. It has W.P. ) No. 3590 OF 2013 14 been observed that traditional limitations have been vanishing and the sphere of judicial scrutiny is being expanded. The Apex Court held that rejection of the highest bid is of course possible, but reasons for the same must be given and communicated to the party concerned. In Food Corporation of India v. M/s.Kamdhenu Cattle Feed Industries (1993 (1) SCC 71), the Apex Court found that the highest price offered by the concerned party was not found sufficient, under which circumstance, negotiations were held, pursuant to which, it was awarded to a third person, who offered the highest price. The challenge raised before the Apex Court against such allotment was repelled, holding that 'inadequacy of price' is a cogent reason to reject the same and that equal opportunity was given to all the applicants to revise their bids by inviting them to negotiation.
14. In Union of India and Ors. v. Dinesh Engineering Corporation and Another (2001 ( 8 ) SCC 491), the Apex Court observed that public authority, even in contractual matters, should not have unfettered discretion and in contracts having commercial element, even though some extra discretion is to be W.P. ) No. 3590 OF 2013 15 conferred in such authorities, they are bound to follow the norms recognised by Courts while dealing with public money, lest arbitrary decisions should be taken by such authorities. It is true that, no reason has been stated in Ext.P8, while rejecting the Tender quoted by the petitioner, which necessitated scrutiny of the 'File' so as to ascertain whether the course of action pursued by the respondents is sustainable, more so in view of the law declared by the Division Bench of this Court in M/s. Zoom Developers Pvt.Ltd v. State of Kerala and Others (2008 (4) KHC 934) holding that, though the reason for rejection of the bid need not be reflected in the relevant order, it shall be discernible from the relevant records/files.
15. The proceedings of the Tender finalised in favour of M/s. Zuvari Cements in respect of Plot No.1 also form part of the 'File' and it gives a clear idea as to the course and proceedings being pursued by the respondents. The 'File' reveals that the Tender Committee, based on the 'Land Policy Guidelines for Major Ports 2010' had fixed a 'reserve price' and the same was kept in a sealed cover, which was never revealed to the participants W.P. ) No. 3590 OF 2013 16 including the petitioner herein or anybody else. On finalisation of the price bid (by way of tender/auction), it was found that the total bid amount in tune with the relevant clauses of the Tender notification, offered by the highest bidder was substantially above the 'reserve price' fixed and kept in the sealed cover and it was accordingly, that the bid was finalised in the name of the concerned party (M/s. Zuvari Cements Ltd.)
16. In respect of the present Tender proceedings as well, the Tender Committee had fixed the minimum amount acceptable ('reserve price) as per the valuation methodology in Clause 1.7 of Section 2 of the Tender documents and it was kept in a sealed cover for the bid of 3.19 hectares of land proposed to be leased out through Tender. The amount quoted by the petitioner is stated as much below the 'reserve price' fixed by the Tender committee and it was after detailed discussion and deliberation, that the Tender Committee recommended to 'Discharge the Tender'. It has been repeatedly held by the Apex Court as well as by this Court that, it is not the decision that is being subjected to judicial scrutiny; but the 'decision making process'. W.P. ) No. 3590 OF 2013 17 The 'File' produced before this Court reveals that the 'decision making process' is not tainted with any malafides or arbitrariness. As held by the Apex Court in Food Corporation of India v. M/s.Kamdhenu Cattle Feed Industries (1993(1) SCC 71), inadequacy of price is of course a cogent reason to reject the Tender. In Meerut Development Authority v. Association of Management Studies and another (2009(6) SCC 171), it has been held that refusal to accept the Tender on the ground that the offer made was lower than the 'reserve price' is legally valid. In Michigan Rubber (India ) Ltd. v. The State of Karnataka and Ors.(2012 ( 8) SCC 216, the Apex Court held that the Government and their undertakings shall have free hand in setting 'terms of Tender' and only if it is arbitrary, discriminatory, malafide or actuated by bias, then alone shall the Court interfere. After discussing the salient aspects governing the scope of interference made by the Apex Court in the earlier judgments including in Jagdish Mandal v. State of Orissa and Others (2007 (14) SCC 517) and in Tejas Constructions and Infrastructure Pvt. Ltd v. Municipal Council, Sendhwa and W.P. ) No. 3590 OF 2013 18 Another (2012 (6) SCC 464), it was held by the Apex Court in paragraph 20 of the decision in Michigan Rubber (India ) Ltd. v. The State of Karnataka and Ors.(2012 ( 8) SCC 216 ) as follows :
"Therefore, a Court before interfering in Tender or contractual matters, in exercise of power of judicial review, should pose to itself the following questions :
(i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone; or whether the process adopted or decision made is so arbitrary and irrational that the court can say: "the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached"; and (ii) Whether the public interest is affected. If the answers to the above questions are in negative, then there should be no interference under Article 226."
17. On going through the pleadings and proceedings and also the contents of the 'File', and considering the factual position in the light of the binding precedents as above, this Court finds that inadequacy of the amount quoted by the petitioner was the W.P. ) No. 3590 OF 2013 19 reason for rejecting the Tender vide Ext.P8 and that there is no attempt to extend undue favour to anybody, but to protect or procure more amounts in the deal, in respect of the public property. As such, there is nothing wrong or arbitrary in having rejected the offer of the petitioner.
18. The next point to be considered is, whether the petitioner should have been called for a negotiation. The specific case of the petitioner is that, the 'reserve price' was always kept a secret and was never let known to the parties at any point of time. In spite of expressing willingness to satisfy the 'reserve price '( stated as discernible from the proceedings videographed), the respondents did not accede to the same, which is stated as an instance of arbitrariness. The stand of the respondents is that, the very purpose of keeping the 'reserve price' a secret, is to avoid unhealthy cartels in the bid proceedings and once it is notified, there will be every chance for the parties to have quoted an amount just above the 'reserve price' and to stall the competitive bidding. The respondents place reliance on the decision rendered by the Apex court in Meerut Development W.P. ) No. 3590 OF 2013 20 Authority v. Association of Management Studies and another (2009 ( 6) SCC 171), whereby the offer made by the respondent therein subsequently, to satisfy the 'base price' was not entertained. It was a case where, a plot of 20,000 sq.m. was alloted to an Educational Institution situated in a Residential Scheme at the rate of Rs.560 per Square Metre to be utilised for educational purpose. The 'reserve price' was fixed in terms of the Government Order providing for allotment of plots for Educational Institution/Engineering Colleges, at 50% of the sector rate. Subsequently, the Educational Institution requested to allot additional extents of 20,000 sq.m. and 37,000 sq.m. under the same Scheme, for setting up an Engineering College and other Degree Colleges. After considering the request and the relevant factors, the appellant/Meerut Development Authority resolved to invite Tender from interested parties fixing the 'reserve price' as Rs.690/- per square metre, in respect of the 20,000 sq.m. and Rs.500/- per sq.m. for the plot having an extent of 37,000 sq.m., both being 50% of sector rate. The concerned Educational Institution quoted only a rate of Rs.560/- W.P. ) No. 3590 OF 2013 21 per sq.m. i.e. much below the reserve rate of Rs.690/- per sq.metre, who hence was put on notice to give consent within one week, if the party was desirous of paying the amount at the rate of Rs.690/- per sq.m., on which event, the MDA was ready to allot the entire extent of 57,000 sq.m. for educational purpose. In the course of further proceedings, the Educational Institution sought to have allotment of 37,000 Sq.m., who raised an objection in respect of fixing the'reserve price' at the rate of Rs.690 sq.m., as the adjoining plots were alloted at the rate of Rs.500/sq.m. and Rs. 560/sq.m.. Finally, the MDA decided to proceed with 'Open Tender' after notifying the land for 'Residential' use. On coming across better offers made by some others, the concerned Educational Institution came up with the willingness to satisfy the amount @ Rs.690 per sq.m., which was not accepted by the Development Authority, who proceeded with the steps for re-tender. After considering the sequence of events, the Apex Court held (in paragraph 40) that there was no difficulty to hold that the authorities owed a duty to act fairly, but it was equally well settled that in the process of judicial review, W.P. ) No. 3590 OF 2013 22 the Court is not concerned with the merits or correctness of the decision, but with the manner in which the decision is taken or the order is made; reiterating that the Court cannot substitute its own opinion for the opinion of the authority in deciding the matter.
19. It is to be noted that, the case of the petitioner herein is with reference to the denial of opportunity to have the bid finalised in the name of the petitioner having offered to satisfy the 'reserve price'. The case of the first respondent in Meerut Development Authority v. Association of Management Studies and another (2009 ( 6) SCC 171) was almost similar, as taken note of in paragraph 22 of the said verdict (besides some other aspects dealt with, therein). The offer made by the first respondent in the said case was held as not liable to be acted upon or acceptable, in view of the reasons given therein. But it is equally important to note that, the 'reserve price' fixed was well notified in the said case and there was absolutely no confusion for any of the parties with regard to the said 'reserve price', as observed by the Apex Court in paragraph 33. The W.P. ) No. 3590 OF 2013 23 observation of the Court in this regard is relevant and hence it is extracted below :
" The subsequent letters sent by AMS at its own choice are of no consequence. MDA did not make any promise that the suggestion of AMS to allot the plot at Rs.560 per square metre was under its consideration. Many a letters including the letter dated 3-1-2002 of the Society makes it clear that there was no confusion whatsoever with regard to the reserved price fixed at Rs.690 per square metre. Once it is clear that there was no vagueness, uncertainty, or any confusion with regard to the reserved price there is no scope for any interference in the matter by this Court. The terms and conditions of the Tender were expressly clear by which the Authority as well as the bidders were bound and such conditions are not open to judicial scrutiny unless the action of the tendering authority is found to be malicious and misuse of its statutory powers."
20. Coming back to the instant case, this Court finds that absolutely nothing is wrong on the part of the respondents, for having fixed the 'base price' and in view of the Land Policy for Major Ports 2010 issued by the Ministry of Shipping, Government W.P. ) No. 3590 OF 2013 24 of India. There cannot be any dispute that the respondents, in dealing with their property, are to decide what should be the minimum price to be procured and it is not for the petitioner to dictate terms. Equally correct and sustainable is the stand of the respondents that, the Tender Committee fixed the 'base price' on the basis of the relevant norms and that the same was kept in a sealed cover, to prevent unhealthy cartels among the participants from quoting something just above the 'base price' and to have the deal and thus avoid possible loss of revenue. However, another question to be considered is, whether the 'base price' fixed by the respondents and kept in the sealed cover, is to remain as secret for ever or should it be opened after finalising the quote of the concerned participants, enabling them to have a fair understanding as to their position, giving an opportunity for all the parties to see whether they are ready to quote the 'base price' or more.
21. There is no dispute from the part of the petitioner that the petitioner had offered to satisfy the 'base price' if any, and that only two parties remained in the scene, that is, the W.P. ) No. 3590 OF 2013 25 petitioner and M/s. Malabar Cements Ltd. Absolutely no reliable material has been produced by the respondents, to sustain that the 'base price' fixed by the respondents and kept in the sealed cover was always to be kept in tact and that at no point of time, shall it be let known to any of the participants. This Court finds it difficult to accept any such proposition, for the reason that, if it is allowed to remain as secret for ever, there may have to be 'ten' or 'twenty' rounds of Tender proceedings leading to cancellation each time, if the highest bid is less than the 'secret base price' (which is known only to the respondents). Each round of Tender proceedings will naturally involve spending of huge amounts by the parties desirous to participate in the bid, involving expensive travel and stay of officers to participate in the bid and return unfruitful, despite offering the highest quote, for not knowing the 'base price' at least at some point of time. How far such an exercise can go on ? Will not the delay, by virtue of such repeated/futile exercise, cause loss of 'public revenue' which otherwise could have been generated had the Tender been finalised, if anybody was willing to quote the 'base price which W.P. ) No. 3590 OF 2013 26 was initially kept as secret; although keeping of 'base price' as secret (initially), is with an object to procure more revenue from willing participants.
22. If the amounts quoted by all the participants happen to be less than the 'base price', there is nothing wrong in revealing the 'base price' to all the participants, giving them a chance to quote an amount higher than the 'base price' by way of negotiation and to finalise the bid. This Court finds it fit and proper to direct the respondents to pursue such course hereafter and it is ordered accordingly.
23. However, since the proper course to be followed is being made clear only now, this Court does not find it as a fit case to invoke the discretionary jurisdiction of this Court and to intercept Ext.P8 proceedings, directing the respondents to give a chance to the petitioner to top up the figure to the 'base price' and to have the offer accepted. To have clarity and to maintain transparency, it is desirable to have the course to be pursued by the respondents as above, be notified and included in the Tender conditions to the effect that the base price/minimum expected W.P. ) No. 3590 OF 2013 27 price will be fixed and kept in a sealed cover during the Tender proceedings and that the same will be let known to the participants, if at all necessitated, so as to give a chance to all the participants to decide, whether they should quote the 'base price' or something more. Necessary notification shall be issued with wide publicity and it is open for the petitioner to participate in the Re-Tender accordingly.
The writ petition is disposed of. The 'File' produced by the learned Standing Counsel for the respondents is returned.
P.R.RAMACHANDRA MENON JUDGE lk/sv.