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Judgment
Sanju Panda, J.—Though all these Writ Petitions were heard on different dates, they raise a common question of law relating to the constitutional validity of the office memorandum dated 13.2.2002 of the Government of Orissa, Works Department amending Rule 3 of the P.W.D Contractor''s Registration Rules, 1967 &, therefore, they are disposed of by this common Judgment.
Public works are executed through registered contractors. No person shall be awarded any work except within permissible limit on job basis under any wing of the P.W.D. & unless he has been registered as a contractor & has obtained a valid certificate of registration. The registration of contractors is governed by the P.W.D Contractor''s Registration Rules, 1967 which came into force with effect from 16th of October, 1969. Rule 3 of the aforesaid rules deals with classification of contractor, According to the aforesaid rules, as amended in 1989, contractors were classified into Special Class, ''A'' Class, ''B'' Class, ''C Class & ''D'' Class & the monetary limit of the cost of the works for the respective category of contractor was accordingly fixed. The aforesaid, Rule 3 underwent an amendment in 1995 which was concurred in by the Finance Department in their U.O.R. No. 446 WF-1 dated 14.9.1995.The said amendment read as under:
For the purpose of registration, the contractors shall be classified as follows & award of any work to any individual contractor the cost of which exceeds the amount noted against the class to which he belongs, is prohibited except with the prior approval of the C.E. or A.C.E.
Class of Contractor Amount (i) Super Class Unlimited (ii) Special Class Not exceeding Rs. 3.00 crores (iii) ''A'' Class Not exceeding Rs. 60.00 lakhs (iv) ''B'' Class Not exceeding Rs. 15.00 lakhs (v) ''C'' Class Not exceeding Rs. 6.00 lakhs. (vi) ''D'' Class Not exceeding Rs. 3.00 lakhs.
According to the aforesaid rules award of work cost of which exceeds the amount noted against a particular class was. prohibited meaning thereby that there was no restriction for a higher class contractor to undertake the work cost of which'' is below the upper limit of his class. While the matter stood thus, the Opp. Party by office memorandum No. Codos-19/2002-3099 dated 13.2.2002 vide Annexure-2 further amended Rule 3 which reads as under:
For the purpose of Registration, the contractors shall be classified as follows & award of any work to any individual contractor the cost of which exceeds the amount rioted against the Class to which he belongs, is prohibited except with the prior approval of the Engineer-in-Chief of Chief Engineer.
Class of Contractors Amount (1) Super Class Unlimited (2) Special Class Not exceeding Rs. 5.00 crores (3) ''A'' Class Not exceeding Rs. 1.00 crore (4) ''B'' Class Not exceeding Rs. 25.00 lakhs (5) ''C'' Class Not exceeding Rs. 10.00 lakhs (6) ''D'' Class Not exceeding Rs. 5.00 lakhs
A contractor having licence for a particular class can offer tender meant for his next below class of the contractor in addition to his own class, e.g. a Super Class can offer bidding meant for ''Special Class'' contractor in addition to ''Super Class'' & ''Special Class'' Contractor can offer bidding meant for ''A'' Class in addition to Special Class & so on." The Petitioners are contractors of different class registered under the P.W.D. Contractor''s Registration Rules.
It is contended by the Learned Counsel for the Petitioners that the aforesaid amendment is arbitrary & unreasonable as it prohibits a contractor having licence for a particular class to offer tender meant for the classes below his class & therefore, the same is violative of Article 19(1)(g) of the Constitution of India. The question for consideration is that as to why the contractors have been classified as Super Class Contractor, Special Class Contractor, ''A'' Class Contractor, ''B'' Class Contractor, ''C Class Contractor & ''D'' Class Contractor. Naturally, the answer would be that the State Government given opportunity to register as Contractor to the persons according to their financial capacity. Presumption is always in favour of the constitutionality of an enactment, since it must be assumed that the Legislature understands & correctly appreciates the needs of its own people, that its laws are directed to problems made manifest by experience & its discriminations are based on adequate grounds.
Hon''ble Apex Court in R.K. Garg v. Union of India 1981 SC 2138 held that while considering the constitutional validity of a statute said to be violative of Article 14, it is necessary to bear in mind certain well established principles which have been evolved by the Courts as rules of guidance in discharge of constitutional function of judicial review. The first rules is that there is always a presumption in favour of the constitutionality of a statute & the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional principles. Another rule of equal importance is that laws relating to economic activities should be viewed with greater latitude than laws touching civil rights such as freedom of speech, religion etc. 1966 Supreme Court 1044.
It is the settled principle laid down by the Hon''ble Apex Court in the case of Harman Singh and Others Vs. Regional Transport Authority, Calcutta and Others, that a legislation is not to be struck down as discriminatory if any state of facts may reasonably be. conceived to justify it. To our opinion, if the Government would have allowed the super class contractor to participate in tender meant for all lower class categories, then there would have been no scope for any inferior class of contractor to participate as for super class contractor who is capable to take work of unlimited value, would not be difficult to take contract up to D Class. There is a saying that big fish eats small fishes & in that case the said saying would have been befitting & the lower class contractors would have been deprived of their right to livelihood guaranteed as their fundamental rights enshrined in the Constitution of India. Therefore, the classification in the impugned notification is rational & on the face of it the Government have made an attempt to categorise the contractors to give opportunity to do their business by way of getting registration under any of the categories of contractors according to their financial status.
Further the Government by the impugned amendment have taken care & allowed a contractor registered under a particular category to participate in tender for his next below class. This very amendment was challenged by a contractor in W.P.(C) No. 2140 of 2008 & did not found favour by this Court. A Division Bench of this Court presided over by the then Chief Justice held that the classification has been done in order to give some protection to A Class, B Class, C Class & D Class Contractors. Since they arc small contractors, they have been given some protection in bidding against the bigger contractors. It was further held therein that such protection is given in order to give fair opportunity of participation to all classes of contractors. The Division Bench held that without such protection, it will be difficult for A,B,C & D Class contractors to bid with Super Class Contractors. The Court held that Article 14 does not prohibit classification & that the classification must not amount to discrimination. Considering the facts & circumstances the Division Bench came to hold that the classification made was based on the value of the contract & by making such classification the authorities have acted in a reasonable manner & there is an object behind such classification which is sought to be achieved by giving some protection to small contractors from the big contractors in the matter of bidding.
In the impugned amendment, the State Government have allowed a particular class of contractor to bid for the class to which he belongs as well as the class next below his class.
We, therefore, see no discrimination or violation of fundamental rights in the impugned amendment. There is, therefore, no merit in these Writ Petitions which arc accordingly dismissed.
There would be no order as to costs.
I.M. Quddusi, A.C.J.
I agree.