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(iii) The next point urged on behalf of the HSCL is that they had entered into a turnkey contract with the Steel Authority of India Ltd., Durgapur Steel Plant. As per the said contract the respondent was to receive the payment from the Steel Authority of India Ltd. (hereinafter referred to as SAIL) in foreign currency for ocean freight and insurance for customs duty in Indian rupees. If HSCL obtains the instruments from the petitioner, HSCL will be deprived of the benefit of the currency fluctuation which is about 200% and also towards reimbursement of the customs duty as the petitioner has refused to indicate the break up of the original price paid to the foreign suppliers, customs duty. If the break up information was so useful to the respondent HSCL, it could insist for these particulars before placing the order. There is nothing on record to show that these particulars were asked for or insisted. It is also submitted that in case HSCL buys the materials from the petitioner, HSCL will be burdened with the additional Sales Tax of 9.2%. It has been sought to be alleged that against of Rs. 44.30 lakhs from SAIL for the five instruments, HSCL will have to incur Rs. 414.09 lakhs for these instruments bringing about a direct loss to the respondent of about 369.79 lakhs. These are matters to be considered prior to the placing of the order and there was nothing to prevent the respondent from not placing the order if it was disadvantageous to do so, Even the contract will sail (sic) has not been disclosed.

(iv) It has also been sought to be alleged that HSCL has now proposed to directly order the said instruments from the foreign suppliers in an attempt to avoid the loss which is likely to suffer by obtaining the goods from the petitioner and also keeping in view of the office memorandum No. F23 (1) -- E2(A)/ 89 dated 31st January, 1989 of Ministry of finance, Department of Expenditure, Government of India. I shall consider the said memorandum at a later stage.

8. The more important ground of justification for issuing the letter dated 26th November, 1992 which has been argued with great stress, is, that on 20th November. 1992, HSCL came to know that the price at which the goods could be imported were very low. It is to be seen that the invitation to tender was for supply of goods of foreign manufacture by India Suppliers, on principal to principal basis and against rupee payment. Several tenderers participated in the tender which appears from the minutes of one of the meetings. The Indian Supplier will have to pay Sales Tax. It also appears that it HSCL would have imported the goods directly, it could do so by paying less customs duty than the Indian suppliers, because the respondent could get the benefit of lower rate of customs duty for import against a project. HSCL in case of direct import had to pay customs duty @ 35% under project import benefit whereas the Indian suppliers who offered the materials to HSCL under the invitation offender had to pay customs duty @ 55%. This item alone that is the difference in customs duty increase the offer by about Rs. 30 lakhs. According to HSCL's calculations the customs duty at 35% under project import benefit would amount to 50.98 lakhs and according to the calculations of the writ petitioner the customs duty on landed cost @ 55% would come to about Rs. 82,41,046.58 paise. There is also the question of Sales Tax @ 9.2%. Furthermore, there is also the question of packing, Inland Freight and Insurance making difference of more than Rs. 7 lakhs. Furthermore, a supplier could not also be expected to supply without any margin of profit. The supplier also runs the risk in entering into a contract at firm rate, because various items of expenditure may increase between the period when the order is placed and the goods are supplied.

9. The contract in question also provides for supervision during erection, testing and commissioning, etc. It is quite possible that HSCL wanted to purchase the materials from Indian suppliers as is evident from their invitation to tender and the negotiations and the ultimate order. It is also quite clear that HSCL did not get any offer from any Indian supplier at a rate of lower than the rate offered by the petitioner. After the contract is placed it becomes a legally binding document and it is no ground in law that that if the purchaser could have purchased from the foreign supplier directly, or in the foreign market he could get the goods at a cheaper rate. The respondent No. 1 before placing the order was at liberty to make whatever enquiries it wanted to make either from the local market or from the foreign market or foreign suppliers. If the order was kept pending for more than 11 months there was no reason why they could not wait for further 5 or 7 days if at all their representative was there in Germany for making enquiries or if at all it was intended to make enquiries through a representative. No name of the representative has been disclosed. As a matter of fact, there is no document to support the alleged enquiry on 20th November, 1992. I should have thought that even at the time of placing the order HSCL or its Purchase Committee members must have known that a direct import could save a lot of money for them in the form of lower rate of Customs Duty. No Sales Tax, no inland packing and forwarding charges, no suppliers' margin of profits and that if they imported directly from the foreign suppliers then they could get the goods at a much cheaper rate. The grounds as to lesser costs or other benefits in case of direct import must have been known prior to the placing of the order. The enquiry that is alleged to have been done on 20th November, i.e. a day after the placing of the order could easily be done prior to 19th November, i.e. before placing the order or alternatively they could wait for a day or two. When they placed the order they must have known that the materials could be obtained at a lower price if they imported the same directly.

10. The next ground urged was that it HSCL obtained the goods from the Indian suppliers at a firm rate basis then HSCL will get less reimbursement from their purchaser i.e. Steel Authority of India Limited. HSCL has not disclosed the contract which they had with SAIL/ DSP. It has also been stated that the contract between HSCL and its purchaser was on a turnkey basis. If it was on a turnkey basis then the price of the goods must have been included in the contract itself. All the facts with regard to the contract of HSCL with SAIL/DSP were must have been within the knowledge of HSCL. Prior to placement of order on the petitioner. Furthermore, the contract with HSCL has not been disclosed before this Court. If HSCL knowing all the facts decided to place the order on the petitioner then they cannot turn round and say that they did not consider all aspects before placement of order or that they want to become wiser after placing the order. The consideration if any should have been made before the placing of the order and after the placing of the order the consequences have to follow. That they will suffer disadvantage by procuring goods from an Indian supplier or that they will be in advantageous position by procuring goods directly from the foreign suppliers were matters to be considered before placing of the order and the facts relating thus to were also within the knowledge of HSCL. The calculations which are annexed at pages 41 and 42 of the affidavit-in-opposition seem to be vague and are not supported by any evidence and cannot be relied on. The alleged calculations do not contain all the particulars therein. In the calculation at page 41, they have converted Deutche mark into rupees at the exchange rate of 7.9. That was not the exchange rate prevailing at the relevant time. This is proved even by their next calculation at pages 42 and 43 where they have mentioned that the conversion rate of 1 DM was equal to Rs. 17.05. If it was 17.05 then how they could convert in the calculation at page 41 as 1 DM equal to Rs. 7.90. This shows that the motive was to reduce the figure to a lower amount in the calculation at page 41. Be that as it may, these calculations or particulars which are sought to be given, relate to facts which were or should have been well within the knowledge of HSCL at or before the date of placing of the order and that is not the reason for which HSCL should be allowed, after the order, to allege that they did not consider something which they should have considered before placing the order.