Sai Construction vs State Of Bihar And Ors

Due to COVID-19 Pandemic, the matter is being taken up by way of Virtual Court proceeding.

Heard Mr. Rajendra Narayan, learned Senior Counsel for the petitioner and Mr. Nadim Seraj, learned counsel for the State.

The present writ application has been filed by the petitioner for quashing the decision taken by the Departmental Tender Committee vide letter Nos. 606 dated 05.03.2020 and 912 dated 15.05.2020, annexed as Annexures-P-4 and P-7 respectively, whereby and whereunder the said Committee has rejected the technical bid of the petitioner and decided to cancel the entire tender. The petitioner has also sought the quashing of Re-e-tender issued by the Executive Engineer vide Memo No.842 dated 26.05.2020 as contained in Annexure-P-9 to this writ application.

The facts, in brief, giving rise to the present writ application are that a Notice Inviting Tender No. 10 Chhapra/2019-20 was published in newspapers and was also uploaded on departmental websites by the Building Construction Department, Works Division, Chhapra. By the said Notice Inviting Tender, eligible bidders were invited for participating their bids for "Construction of additional 300 beded boys Hostel (Two Blocks) for Rajikiya Polytechnic College, Chhapra" at Madhepura for the year 2019-20. The petitioner participated in the bid on 07.01.2020 for the aforesaid work by e-tendering method. Only two bidders took part in the said tender. One being the petitioner and the another was M/s S.K. Enterprises, Patna. Thereafter, documents submitted/ uploaded by both the bidders were preliminarily assessed and evaluated by the Technical Bid Evaluation Committee headed by the concerned Chief Engineer. On 11.02.2020, after evaluating the documents of both the bidders, the Technical Bid Evaluation Committee found that M/s S.K. Enterprises, Patna fulfilled all the eligibility criteria and recommended it to be responsive. So far as the bid of the petitioner is concerned the Technical Bid Evaluation Committee found that the bid of the petitioner was non-responsive in terms of Clause 4.5 A(d) of Instruction to Bidders (I.T.B.) of the Standard Bidding Document. Relevant extract of letter No. 606 dated 5.3.2020 (Annexure-P-4) is as under:

"समिति द्वारा जाचोपरांत पाया गया कि इनके द्वारा एस0बी0डी0 की कंडिका- 4.5 A (b) के तहत इन्होंने Sub-Contract के रूप में Vishnu Construction (विद्युत निबंधन सं0- 441718) का विद्युत निबंधन प्रमाण पत्र समर्पित किया है एवं निविदाकार द्वारा Sub-Contract के पक्ष में Affidavit दिया गया है परन्तु Sub-Contract "Vishnu Construction" द्वारा Sub-Contract के पक्ष में Affidavit/Consent letter नहीं दिया गया है। अतः इन्हें एस0बी0डी0 की कंडिका- 4.5 A (b) के तहत नान-रिस्पान्सिव पाया गया तकनीकी बीड में असफल घोषित करने की अनुशंसा की जाती है। अतः प्रथमवार एकल निविदाकार होने के कारण वित्त विभाग की अधिसूचना संख्या- 7806 दिनांक 30.09.16 के आलोक में पुनर्निविदा करने की अनुशंसा की गयी एवं विभागीय निविदा समिति के समक्ष सहमति हेतु उपस्थापित करने का निर्णय लिया गया।"

The Technical Bid Evaluation Committee also suggested that since it has found the bid of the petitioner to be non-responsive, there will be only one successful bidder for the Financial Bid. Therefore, in pursuance to Finance Department letter No. 7806 dated 30.09.2016 in such a situation Re-Tender should be done. Based on the aforesaid decision/ recommendation of the Technical Bid Evaluation Committee, the Departmental Tender Committee headed by the Principal Secretary vide Letter No. 606 of 2020 dated 05.03.2020 (Annexure-P-4) agreed by the Technical Bid Evaluation Committee's decision and declared the bid of the petitioner to be 'Non Responsive' in terms of Clause 4.5 A(d) of Instruction to Bidders (I.T.B.) of the Standard Bidding Document. Further, it was also decided by the Departmental Tender Committee that in case any objection related to tender is received till 11:00 AM on 12.03.2020, the concerned Chief Engineer will call a meeting of the Technical Bid Evaluation Committee and will reconsider its decision and will present the same before the Departmental Tender Committee. If, no objection related to the tender is received till the above stipulated time then the concerned Chief Engineer will proceed for Re-Tender.

The petitioner filed objection on 09.03.2020 (Annexure-P-5) stating therein that his bid was wrongly declared to be "Non-Responsive" in terms of non-fulfilment of Clause 4.5 A(d) of the Instructions to Bidders of the Standard Binding Document and it fulfills all the eligibility criteria and requested the Technical Bid Evaluation Committee for reconsideration of its bid. Relevant extract of the objection filed by the petitioner, as stated in Annexure-P-5, is as under:

"लेकिन विभागीय निविदा समिति ने केवल हमारे द्वारा ही दिये गये Affidavit का जिक्र किया गया ऐसा प्रतीत होता है कि हमारे द्वारा अपलोड किये गये Affidavit को डाउनलोड करने में कोई विभागीय गलती हुई है।"

The Technical Bid Evaluation Committee considered the objection filed by the petitioner and for verifying the grievance raised by the petitioner, the Technical Bid Evaluation Committee wrote to BELTRON (Service Provider) and it was replied by BELTRON. Relevant extract of letter no. 912 dated 15.5.2020 (Annexure-P-7) is as under:

"The mentioned vendor uploaded general document is itself corrupted and unable to read the same."

In light of the above fact, it was decided by the Technical Bid Evaluation Committee that due to non-compliance of Clause 4.5 A(d) of the Instructions to Bidders, the technical bid of the petitioner was rejected. Further, it was also pointed out by the said Committee that vide letter No. 7287 dated 08.08.2019, a Check-list mandating filing of Affidavit by the Sub-Contractor is required to be annexed with the Tender notice which was not annexed with the tender notice in question. As a result of which, it was decided that the tender in question is defective and the same was cancelled and recommendation for Re-Tender was given. The same decision was placed before the Departmental Tender Committee which accepted the same and by letter No. 912 dated 15.5.2020 (Annexure-P-7), the technical bid of petitioner was cancelled in terms of non-compliance of requirement of Clause 4.5 A(d) and for non-compliance of the letter No. 7287 dated 08.08.2019, the tender was declared to be defective and decision regarding Re-Tender was taken. Thereafter, acting upon the above-mentioned decision dated 08.08.2019, a fresh tender notice was published vide Letter No.842 of 2020 dated 26.05.2020 (Annexure-9). As stated above, the petitioner has challenged Annexures-P-4, P-7 and P-9 in the writ application on the ground of they being arbitrary and in contravention of the conditions of the contract.

Learned Senior Counsel, appearing on behalf of the petitioner, has submitted that the petitioner has duly uploaded the Affidavits (one of the petitioner and another of the Sub-Contractor) as per general practice and the technical bid of the petitioner has been wrongly rejected by the Committee in an arbitrary manner because as per Clause 4.5 A(d) of the I.T.B. of the Standard Bidding Document, no affidavit was required to be filed by them. It has also been submitted by learned Senior Counsel that since the requirement of furnishing the said Affidavits is a mandate which arises from Departmental letter No. 7287 dated 08.08.2019 which was not made a part of the Tender notice in question. The uploading of the Affidavits was not at all required and, therefore, rejection of its technical bid on account of not uploading the Affidavits, as per Clause 4.5 A(d) of the I.T.B. of the Standard Bidding Document, is bad in law. It has further been submitted by learned Senior Counsel for the petitioner that while submitting the necessary documents, a check-list was also uploaded by the petitioner as per practice. Therefore, the tender has been cancelled by the respondent authorities on non-est ground.

Learned counsel appearing for the State while refuting the submissions made by the petitioner has submitted that the Technical Bid Evaluation Committee considered bids of both the bidders and found that the bid of the petitioner as "Non-Responsive" in terms of Clause 4.5 A(d) of the Instruction to Bidders of the Standard Bidding Document. Learned counsel for the State has also pointed out that after the objections filed by the petitioner (Annexure-P-5), a report was called for from BELTRON (Service Provider) and it was found that because of the corrupt file being uploaded, it was not possible to evaluate the same and the Committee rejected the bid of the petitioner vide Annexure-P-7 after considering the objections raised by the petitioner.

Learned counsel for the State, by way of filing a counter affidavit, has brought on record letter No.7287 dated 08.08.2019 along with the Check-list which was supposed to be the part of the tender notice. Learned counsel for the State has also drawn the attention of this Court towards Clause 17 of the Tender Notice whereby and whereunder the right to cancel the Tender without assigning any reason has been reserved by the Respondent State authorities. He further submits that after finding that the Tender Notice did not contain the check-list which was required to be annexed with it as per the mandate of Letter No. 7287 dated 08.08.2019, the Respondent authorities cancelled the entire tender.

In light of the above facts, it appears that there are two issues which arise for consideration before this Court. The first issue is that whether the reason assigned (i.e., nonfulfillment of the requirement of Clause 4.5 A (d) in Annexure-P-4 by which the technical bid of the petitioner has been cancelled, is arbitrary and in contravention to the provision as stipulated in Clause 4.5 A(d)? The second issue is whether the Respondent Authorities were justified in cancelling the Tender vide Annexure-P-7 and in issuance of Re-Tender as contained in Annexure-P-9 and is the same tenable and justified in the eyes of law?

Before dealing with and adverting to the issues raised in this writ application, I find it necessary to discuss the limited scope of judicial review which a Writ Court can exercise under Article 226 of the Constitution of India in contractual matters arising out of disputes related to Tender. It is a settled principle of law that submission of a tender in response to a notice inviting such tenders is no more than making an offer which the State or its agencies are under no obligation to accept. The Court, while exercising the powers of Article 226 of the Constitution of India can only interfere with the decision taken by the State in Contractual Matters where it is sufficiently demonstrated before it that the action of the State is discriminatory, mala fide or arbitrary. The Writ Court cannot and ought not to sit as an appellate authority to the decision taken by the concerned department. The Hon'ble Supreme Court in Tata Cellular v. Union of India reported in (1994) 6 SCC 651, has held that

"It cannot be denied that the principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. However, it must be clearly stated that there are inherent limitations in exercise of that power of judicial review. Government is the guardian of the finances of the State. It is expected to protect the financial interest of the State. The right to refuse the lowest or any other tender is always available to the government. But, the principles laid down in Article

14 of the Constitution have to be kept in view while accepting or refusing a tender. There can be no question of infringement of Article 14 if the Government tries to get the best person or the best quotation. The right to choose cannot be considered to be an arbitrary power. Of course, if the said power is exercised for any collateral purpose the exercise of that power will be struck down."

The Hon'ble Apex Court in another case of Maa Binda Express Carrier and Ors. Vs. Northeast Frontier Railway and Ors. reported in (2014) 3 SCC 760 has categorically held that -

"All that participating bidders are entitled to is a fair, equal and non-discriminatory treatment in the matter of evaluation of their tenders. It is also fairly well-settled that award of a contract is essentially a commercial transaction which must be determined on the basis of consideration that are relevant to such commercial decision. This implies that terms subject to which tenders are invited are not open to the judicial scrutiny unless it is found that the same have been tailor made to benefit any particular tenderer or class of tenderers. So also the authority inviting tenders can enter into negotiations or grant relaxation for bona fide and cogent reasons provided such relaxation is permissible under the terms governing the tender process."

(Emphasis applied)

The petitioner, at the time of participating in the bid, uploaded his Affidavit and the Affidavit of its Sub-Contractor as per general practice and not in terms of Clause 4.5 A(d) of the I.T.B of the Standard Bidding Document. The Affidavits which the petitioner and its Sub-Contractor were supposed to upload were required to be both in terms of Clause 4.5 A(d) of the I.T.B of the Standard Bidding Document and the check-list enclosed with Letter No. 7287 dated 08.08.2019. The said check-list was not a part of the tender notice. A bare perusal and comparison of the check-list annexed by the petitioner and the check-list brought on record by way of counter affidavit make it clear that both the check-lists are different and hence, it cannot be said that the check-list uploaded by the petitioner was in consonance with the check-list enclosed with letter No.7287 dated 08.08.2019. The petitioner cannot blow hot and cold at the same time and take stands as per his own convenience.

After considering the entire gamut of facts, arguments advanced from both the sides, the decisions rendered by Hon'ble Apex Court in a catena of judgments enumerating the scope of judicial review that can be exercised under Article 226 of the Constitution of India in contractual matters related to Tender, this Court is of the opinion that the Respondent authorities have rightly rejected the technical bid of the petitioner vide Annexure-P-4 and the reason assigned in the order that the petitioner failed to comply with the provisions enumerated in Clause 4.5 A(d) of the I.T.B. of the Standard Bidding Document is well-reasoned and justified.

So far as the second issue regarding cancellation of tender and issuance of Re-Tender vide Annexures-P-7 and P-9 respectively, is concerned, since the tender itself was defective for the reason that it did not contain the Check-list as per the departmental letter no. 7287 dated 08.08.2019, such a deficiency is a sufficiently justified reason for cancellation of the entire Tender process. Thus, the Respondent authorities were well within their right as per Clause 17 of the tender notice in taking the said decisions regarding cancellation of Tender and issuance of Re-Tender. At this point, it is of much relevance to mention here that in Maa Binda Express Carrier and Ors. (Supra), the Hon'ble Apex Court while dealing with a similar issue has held in para 11 of the judgment that -

"On the contrary, if a contract had been awarded despite the deficiencies in the tender process serious questions touching the legality and propriety affecting the validity of the tender process would have arisen. In as much as the competent authority decided to cancel the tender process, it did not violate any fundamental right of the Appellant nor could the action of the Respondent be termed unreasonable so as to warrant any interference from this Court."

In view of the discussions made hereinabove, in the light of decisions rendered by the Hon'ble Supreme Court in above- mentioned cases and the facts of the case in hand being pari materia with the facts of the Maa Binda Express Carrier and Ors. (Supra), I am of the considered opinion that the respondent authorities have rightly cancelled the defective tender and decided to go for Re-tender and as such, no interference is required by this Court.

The writ application lacks merit. It is, accordingly, dismissed.