K. D. Transport vs Food Corporation Of India

S. No.,Name of Party,EMD Details,"S t a t us in the

Technical Bid","Rate quoted by technically qualified

bidders

1/4,"Shree Madhupuri Transport

Contractor",MSME,Unsuccessful,

S. No.,Name of Party,EMD Details,"S t a t us in the

Technical Bid","Rate quoted by technically qualified

bidders

1/4,"Shree Madhupuri Transport

Contractor",MSME,Unsuccessful,

2/4,Shree Mahalaxmi Road Lines,MSME,Successful,Rs. 1128 / MT (L-2)

3/4,Shah Transport Company,MSME,Successful,Rs. 1111 / MT (L-1)

4/4,K. D. Transport,MSME,Successful,Rs. 1295 / MT (L-3)

,,,,

(iv) the parties who have taken the benefit of such relaxation should not ordinarily be allowed to take a different stand in relation to compliance with another part of,,,,

tender contract, particularly when the was also not in a position to comply with all the conditions of tender fully, unless the court otherwise finds relaxation of a",,,,

condition which being essential in nature could not be relaxed and thus the same was wholly illegal and without jurisdiction;,,,,

 (v) when a decision is taken by the appropriate authority upon due consideration of the tender document submitted by all the tenderers on their own merits and if it,,,,

is ultimately found that successful bidders had in fact substantially complied with the purport and object for which essential conditions were laid down, the same may",,,,

not ordinarily be interfered with; …â€​ [para 66],,,,

We also agree with the contention of Shri Raval that the writ jurisdiction cannot be utilized to make a fresh bargain between parties.,,,,

In General Assurance Society Ltd. V. Chandmull Jain, (1996) 3 SCR 500, this Court, in a slightly different context, stated: “In other respects there is no difference",,,,

between a contract of insurance and any other contract except that in a contract of insurance there is a requirement of uberrima fides i.e. good faith on the part of the,,,,

assured and the contract is likely to be construed contra proferentem that is against the company in case of ambiguity or doubt. A contract is formed when there is an,,,,

unqualified acceptance of the proposal. Acceptance may be expressed in writing or it may even be implied if the insurer accepts the premium and retains it. In the case,,,,

of the assured, a positive act on his part by which he recognises or seeks to enforce the policy amounts to an affirmation of it. This position was clearly recognised",,,,

by the assured himself, because he wrote, close upon the expiry of the time of the cover notes that either a policy should be issued to him before that period had",,,,

expired or the cover note extended in time. In interpreting documents relating to a contract of insurance, the duty of the court is to interpret the words in which the",,,,

contract is expressed by the parties, because it is not for the court to make a new contract, however reasonable, if the parties have not made it themselves. Looking at",,,,

the proposal, the letter of acceptance and the cover notes, it is clear that a contract of insurance under the standard policy for fire and extended to cover flood,",,,,

cyclone etc. had come into being.â€​,,,,

In the light of the aforesaid judgment, the High Court was not correct in treating Respondent No.1’s offer as matching with the revised minimum wage",,,,

calculation, as that would make a new contract between the parties that the parties have not made themselves.",,,,

It is also well to remember the admonition given by this Court in Michigan Rubber (India) Limited v. State of Karnataka and Others, (2012) 8 SCC 216 in cases like",,,,

the present, as under:-",,,,

“In Jagdish Mandal v. State of Orissa, [(2007) 14 SCC 517], the following conclusion is relevant:",,,,

“22. Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and mala fides. Its purpose is to check",,,,

whether choice or decision is made ‘lawfully’ and not to check whether choice or decision is ‘sound’. When the power of judicial review is invoked in,,,,

matters relating to tenders or award of contracts, certain special features hould be borne in mind. A contract is a commercial transaction. Evaluating tenders and",,,,

awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona,,,,

fide and is in public interest, courts will not, in exercise of power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a",,,,

tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual",,,,

disputes. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary grievances,",,,,

wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to",,,,

interfere by exercising power of judicial review, should be resisted. Such interferences, either interim or final, may hold up public works for years, or delay relief and",,,,

succour to thousands and millions and may increase the project cost manifold. 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’;,,,,

(ii) Whether public interest is affected.,,,,

If the answers are in the negative, there should be no interference under Article 226. Cases involving blacklisting or imposition of penal consequences on a tenderer/",,,,

contractor or distribution of State largesse (allotment of sites/shops, grant of licences, dealerships and franchises) stand on a different footing as they may require a",,,,

higher degree of fairness in action.â€​[Para 21],,,,

We have seen that the present tender has not gotten off the ground since May 2015, and one year’s precious time has been wasted due to litigation between",,,,

the parties. We must hasten to add that the Government of Gujarat is partly to blame for this inasmuch as it arrived at a minimum wage figure and did not disclose the,,,,

same to the tendering parties twice. Even in the second round of litigation, the Government did not disclose the newly arrived at minimum wage figure of",,,,

Rs.2,91,00,000/- to the two persons in the fray before us. Ordinarily, therefore, we would have asked the Government to disclose the second figure of minimum wage",,,,

and restart the tendering process. However, we do not think that the justice of the case requires us to do so, for two reasons. First and foremost, Respondent No.1",,,,

before us has clearly violated the strict terms of the tender condition on every occasion and hence cannot be given relief. And, secondly, we already find that due to",,,,

litigation the present tender has not taken off for over one year. In the absence of malafides, and indeed the High Court judgment has found that malafides did not",,,,

vitiate the calculation of minimum wage by the Labour Department, we cannot accept Shri Divan’s submission that the figure of Rs.2,91,00,000/- was tailor made to",,,,

suit the bid offered by the Appellant herein. We, therefore, set aside the decision of the Gujarat High Court and allow the Government to proceed further in finalizing",,,,

the tender in favour of the Appellant herein. The appeal is, accordingly, allowed with no order as to costs.",,,,

The aforesaid paragraphs makes it very clear that the essential conditions are required to be adhered to and in the present case also the essential,,,,

conditions have been adhered to and, therefore, the question of interference by this Court in the peculiar facts and circumstances of the case, does not",,,,

arise.,,,,

Reliance has also been placed upon the judgment delivered in the case of Vidharbh Irrigation Development Corporation Vs. Anok Kumar Garwala,,,,

reported in 2019 SCC Online SC 89. Paragraph 15 of the aforesaid judgment reads as under :,,,,

Similarly in B.S.N. Joshi & Sons Ltd. v. Nair Coal Services Ltd. [B.S.N. Joshi & Sons Ltd. v. Nair Coal Services Ltd., (2006) 11 SCC 548] this Court held as under:",,,,

(SCC pp. 571-72, para 66) “(i) if there are essential conditions, the same must be adhered to;",,,,

(ii) if there is no power of general relaxation, ordinarily the same shall not be exercised and the principle of strict compliance would be applied where it is possible for",,,,

all the parties to comply with all such conditions fully;,,,,

(iii) if, however, a deviation is made in relation to all the parties in regard to any of such conditions, ordinarily again a power of relaxation may be held to be existing;",,,,

(iv) the parties who have taken the benefit of such relaxation should not ordinarily be allowed to take a different stand in relation to compliance with another part of,,,,

tender contract, particularly when he was also not in a position to comply with all the conditions of tender fully, unless the court otherwise finds relaxation of a",,,,

condition which being essential in nature could not be relaxed and thus the same was wholly illegal and without jurisdiction;,,,,

(v) when a decision is taken by the appropriate authority upon due consideration of the tender document submitted by all the tenderers on their own merits and if it is,,,,

ultimately found that successful bidders had in fact substantially complied with the purport and object for which essential conditions were laid down, the same may",,,,

not ordinarily be interfered with;…â€​,,,,

This Court is of the considered opinion that in the present case the respondent No.3 does have the requisite qualifications and experience as per the,,,,

NIT and he was rightly found eligible by the tender evaluation committee. This Court does not find any reason to interfere with the process, as work",,,,

has been awarded to a person who is L1 and the petitioner is the person who has offered highest rate.,,,,

Ms. Swati Ukhale, learned counsel for the respondent - Food Corporation of India has argued before this Court that as per Circular dated 5/2/2020,",,,,

the right to raise grievance is restricted only to disqualified bidder and the petitioner who has been found technically qualified, has got no locus to raise",,,,

a grievance. The Clause 1(c) of the circular dated 5/2/2020 reads as under:,,,,

(c) The results of technical evaluation will be uploaded on the CPP Portal. In case there are technically disqualified bidders, the reason for disqualification will be",,,,

uploaded and price bid shall be opened only after three working days. If any of the bidders is disqualified, he may submit grievance (if any), to General Manager",,,,

(Region) within three working days from the date of disqualification. However, no new documents will be accepted. In case of receipt of grievance, General Manager",,,,

(Region) will redress the grievance by passing Speaking Order within seven (7) working days. In case of receipt of grievance from any disqualified bidder, the validity",,,,

period of the tender shall get automatically extended by 15 working days, which shall be binding on all the bidders.",,,,

This Court has carefully gone through the aforesaid clause in Circular dated 5/2/2020. It is true that the aforesaid circular provides that a disqualified,,,,

person who has been disqualified by a tender evaluation committee can raise the grievance to the General Manager and the same shall be decided by,,,,

passing a speaking order. The aforesaid circular nowhere debars any person to challenge the decision taken by the technical evaluation committee in,,,,

respect of the other bidders. If such an interpretation is given, as argued by the learned counsel, it will give unfettered powers to the Food Corporation",,,,

of India and they will be rejecting all the representations of all those persons who have been found technically fit, in respect of their grievance in",,,,

respect of other bidders by taking shelter of the aforesaid clause. The other participants who attended the process does have a right, as guaranteed",,,,

under the Constitution of India to approach this Court for ventilating their grievance. Any Circular / Executive Instructions cannot stop people from,,,,

approaching the High Courts under Article 226 of the Constitution of India or the Hon'ble Supreme Court. Otherwise also, the Circular nowhere says",,,,

that a person aggrieved in the matter cannot approach the High Court and, therefore, the argument to the extent the interpretation of the Circular",,,,

dated 5/2/2020 has been canvassed by the learned counsel for the respondent - Food Corporation of India is repelled. The petitioner has rightly,,,,

approached this Court being aggrieved by acceptance of tender in favour of respondent No.3 though this Court has arrived at a conclusion that there,,,,

is no irregularity in the matter of allotment of work to respondent No.3.,,,,

This Court does not find any reason to set aside the Letter of Intent already issued in favour of respondent No.3 and as no case is made out on merits,",,,,

the Writ Petition is accordingly dismissed.,,,,