Gaurav Traders and Another vs State of U.P. and Others

Amitava Lala, A.C.J.

The writ Petitioners have filed this writ petition for quashing condition No. 3 of deposit of solvency certificate in the name of the partnership firm as mentioned in the technical bid sheet issued from the office of the Executive Engineer, National Highway Division, Public Works Department, Moradabad in regard to the auction notice dated 24th of April, 2010 in respect of collection of toll tax on NH-119. Meerut Pauri Marg, KM-68 situated at Ganga Barrage Bridge. The writ Petitioners further prayed to allow them to participate in the auction bid. The writ Petitioners also prayed not to reject the tender document submitted by them for collection of toll tax. The writ Petitioners, lastly prayed that the solvency certificate of the partnership firm be treated as guarantee on the part of the firm.

According to us, it is, by and large, a commercial dispute and with limited scope only, we can interfere with it in the writ jurisdiction. From the condition of the technical bid, we find that the solvency certificate of Rs. 400 lacs of the firm is required for the purpose of entrusting the work. According to the writ Petitioners, this clause is arbitrary in nature to eliminate the small entrepreneurs, who have clubbed together and formed a firm for the purpose of carrying out the business. From the annexures to the writ petition, we find that there are six partners and their shares in the partnership have been specified in Annexure-2 to the writ petition, but the present writ petition has been filed only by the partnership firm and one partner supported by the affidavit of Satya Pal Singh, R/o Village and Post Office- Bamnauli, District Baghpat. Initially, we found that Satya Pal Singh is husband of one of the partners, namely, Smt. Jagdish Kaur, but she is resident of C-37, Pandav Nagar, Meerut. Good, bad or indifferent, no authorisation on the part of such Satya Pal Singh is available with us excepting the description in the affidavit that he is pairokar of the firm.

Background of this dispute is required to be discussed herein. In an earlier occasion, a writ petition, being Civil Misc. Writ Petition No. 16786 of 2010. Jai Singh v. State of U.P. and Ors. was disposed of by a Division Bench of this Court presided over by one of us (Amitava Lala, J.), whereunder the Division Bench has shifted the place of tender to different Commissionery, i.e., Commissioner, Bareilly Division to maintain the transparency with regard to the public auction in entrusting the job. Such order was passed by this Court on 31st of March, 2010. In compliance of such order, fresh tender notice has been issued and it is going to be held by the end of this month. Yet another writ petition has been filed by the name of firm. It is significant to note that a further writ petition was filed by M/s. Gaurav Traders and another, was dismissed for non-prosecution on 1st of April, 2010.

In this background, the genuinity of the grievance before this Court is not much trustworthy.

Learned standing counsel appearing on behalf of the State-Respondents has contended before us about the maintainability of the writ petition as well as made submission on the merit of the case. So far as the maintainability part is concerned, it is technical in nature, therefore, we should not make any comment with regard to the maintainability of the writ petition. So far as the merit of the case is concerned, he relied upon a judgment of the Supreme Court in Jagdish Mandal v. State of Orissa and Ors., 2007 (8) SCJ 359, wherein it has been held that 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.

(ii) 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.''

(iii) Whether public interest is affected.

If the answers are in the negative, there should be no interference under Article 226 of the Constitution of India.

The very basis of the argument, as advanced before us by the learned Counsel appearing for the writ Petitioners, is that the small entrepreneurs have joined hands together and formed a firm and if they are allowed to give their own solvency certificate instead of the firm, no harm will be caused to the authorities.

Against this background, we want to say that in contractual obligations, no question of showing any sympathy to the small entrepreneurs or big entrepreneurs can arise. The unreasonableness or arbitrariness will have to be based on the materials. But we do not find any such material in the tender form on the part of the authorities. One significant part is that in the toll tax matter on the bridges under the National Highways Authority, the authority of the Central Government is principal, and the State is its agent. Therefore, in this case, law of beneficial piece of legislation only to show sympathy to the small entrepreneurs cannot be attracted. Moreover, we are strictly governed by the guidelines issued by the Supreme Court as above. We will neither be able to come to the conclusion that the intention of the authority is mala fide, nor it shocks the conscience of the Court. On the other hand, public interest might have been affected, if the genuine persons with sound financial status are not entrusted the work of collection of toll tax and if for any financial ground, they leave the work in the midway. Both the Central and State Governmental authorities will face many problems.

Against this background, we cannot hold and say that interference by the writ court under Article 226 of the Constitution of India, is a welcoming situation. This classification has to be reasonable and we do not think that the said classification is unreasonable.

Having so, this writ petition is dismissed, however, without imposing any cost.

Supplementary affidavit filed today be kept with the record.

Shabihul Hasnain, J.--I agree.