ABHAY KUMAR SAHU vs STATE OF ODISHA AND OTHERS

VINEET SARAN, C.J.

In response to a tender call notice dated 20.12.2016 issued by the opposite party no.2, the petitioner as well as opposite party no.3 and others had

applied. The technical bids were opened on 30.01.2017 and result of the same was uploaded on the website on 15.02.2017, in which the petitioner as

well as opposite party no.3 and two other bidders were found to be qualified. The price bids of all the four qualified bidders were opened on

16.02.2017 and the price offered by the petitioner was found to be the lowest. To clarify here, it may be mentioned that the lowest price of the

petitioner was 8.22% less than the estimated value, whereas that of the opposite party no.3 was 7.2% less than the estimated value. The price quoted

by the other two bidders was much more than that of the petitioner, and hence they are not relevant for the purpose of this case. The petitioner

thereafter waited for the contract being awarded in his favour, but to his surprise, he learnt that on 18.03.2017 the Engineer-in-Chief, Rural Works,

Odisha-opposite party no.2 wrote to the opposite party no.3 (who was second lowest bidder) calling him for negotiations. Challenging the same, this

writ petition has been filed with the further prayer that the petitioner, being the lowest bidder, should be awarded the contract.

We have heard Sri S.K. Mishra, learned counsel for the petitioner, as well as Sri P.K. Muduli, learned Addl. Government Advocate appearing for

State opposite parties no.1 and 2 and Sri P.K. Rath, learned counsel for private opposite party no.3 and perused the record. Counter affidavit has been

filed by State opposite parties, to which rejoinder affidavit has also been filed. However, despite time having been granted, no counter affidavit has

been filed by opposite party no.3.

The facts as stated above are not disputed. The question to be decided by this Court is as to whether the second lowest bidder could be called for

negotiations in the absence of there being any such provision. It is also to be considered as to whether the lowest bidder, after having been found to be

technically qualified, would have a right to be awarded the contract.Â

In the counter affidavit filed by the State opposite parties it has been admitted that the petitioner, who was found to be technically qualified, was the

lowest bidder having quoted rate of 8.22% less than the estimated value, but considering the past performance of the petitioner regarding execution of

roads under R.W. Division-II, Cuttack and other works, in which it was found that the petitioner was a slow performer, the petitioner was not

awarded the contract. It is however not denied that the petitioner was found to be technically qualified.Â

Once a party is found to be technically qualified and his financial bid has been opened, his bid cannot be rejected because of his past performance,

which would amount to blacklisting the contractor without passing any order or without providing the contractor an opportunity of hearing. If there was

any complaint with regard to slow performance or adverse report against the petitioner, action could have been taken against the petitioner, after

giving notice and complying the principles of natural justice. Debarring the petitioner from being awarded the contract, even though he is found to be

the lowest bidder after having been found to be technically qualified, cannot be justified in law. We may reiterate that the same would amount to

blacklisting the contractor without following principles of natural justice. It may further be stated that no order for not accepting the bid of the

petitioner (which was the lowest) has been passed by the opposite party and the reasons as given above have only been given in the counter affidavit,

which is also not permissible in law.

The apex Court in Commissioner of Police, Bombay v. Gordhandas Bhanji, AIR 1952 SC 16 held as follows:

“Public orders publicly made, in exercise of a statutory authority cannot be construed in the light of explanations subsequently given by the officer

making the order of what he meant, or of what was in his mind, or what he intended to do. Public orders made by public authorities are meant to have

public effect and are intended to affect the acting and conduct of those to whom they are addressed and must be construed objectively with reference

to the language used in the order itself.â€​Â

The Constitution Bench of the apex Court in Mohinder Singh Gill v. The Chief Election Commissioner, New Delhi, AIR 1978 SC 851, the apex

Court held :

 “ …… when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and

cannot be supplemented by fresh reasons in the shape of affidavit or otherwise. Otherwise, an order bad in the beginning may, by the time it comes to

court on account of a challenge, get validated by additional grounds later brought out. Orders are not like old wine becoming better as they grow old.â€​

Further, in the counter affidavit, the opposite parties have not placed any provision of the tender call notice under which the second lowest bidder

could be called for negotiations. In the absence of there being any such provision, negotiations with the second lowest bidder would not be permissible

in law. As such, we are of the firm opinion that the communication dated 18.03.2017 made by opposite party no.2 with the opposite party no.3 is

wholly unjustified and liable to be quashed, and accordingly the same is set aside.

In the facts of the present case, since the petitioner was found to be technically qualified and he was the lowest bidder and no order rejecting his bid

has been passed, the petitioner ought to have awarded the contract. Accordingly, it is directed that the State opposite parties may pass suitable orders

in accordance with law with regard to awarding of contract within 15 days from the date of receipt of a certified copy of this order before the

opposite party no.2.

The writ petition stands allowed. No order to costs.