Sourav Kr. Roy vs The State of West Bengal and Others

Pratap Kumar Ray, J.—Heard the learned Advocates appearing for the parties.

Challenging the judgment and order dated 16th May, 2007 passed by the learned trial Judge in W.P. No. 7738 (W) of 2007, this appeal has been preferred by the appellant/writ petitioner.

Learned trial Judge dismissed the writ application on the findings that the writ petitioner had no locus standi to move the writ application and furthermore already after completion of 45% of the work and payment made thereof to the allottee concerned for construction of the boundary wall of the Panchayat Samity with reference to the first tender floated wherein he was the only eligible tenderer, the petitioner, moved the writ application to assail the same.

The factual matrix of the writ application was to this effect.

For construction of a boundary wall in the office of the Panchayat Samity concerned, a tender notice was issued on 13th January, 2006 from Binpur-I, Panchayat Samity. Out of many applications, only one person was eligible to submit the tender in terms of the eligibility criteria fixed and the respondent No. 9 herein submitted his tender form by quoting the rate and deposited the earnest money as was fixed. The tender was opened and his tender was accepted. But no work order was issued. Assailing such action, the respondent No. 9 moved the writ application in the Hon''ble High Court at Calcutta, registered as W.P. No. 5121 (W) of 2006 wherein the Court asked the Panchayat Samity to keep their hands off so far as floating of the second tender was concerned. However, the Panchayat Samity proceeded to float the second tender inviting application on 27th November, 2006, but subsequently they recalled it and thereafter they issued the work order in favour of the respondent No. 9 whose tender was accepted with reference to the first tender. The respondent No. 9 in terms of the work order completed 45% of work regarding construction of boundary wall and got part payment of such work at the time of hearing of the writ application, which was the finding of the learned Judge. The learned trial Judge considered the question of locus standi as well as the question of entertainability of the writ application as the power of Writ Court is discretionary and answered the point negatively against the appellant/writ petitioner. Being aggrieved this appeal.

Learned advocate for the appellant has raised a point of applicability of the legitimate expectation principle on the premises that his client had the intention to submit tender form but could not due to postponement of second tender notice which subsequently was cancelled. It is the case of the appellant that had there been floating of second tender, his client would have submitted the tender form. In the instant case as well as from the action of the respondent, Panchayat Samity it appears that they did not cancel the first tender but on selecting a candidate by accepting his tender did not issue the work order which became the subject matter of the writ application and during the pendency of that writ application they floated the second tender, but subsequently recalled it. The question of recalling of any tender which is also an administrative function is within the domain of the concerned authority and if there is any mistake on their part to float a second tender during the pendency of the writ application with reference to the first tender is concerned, such action cannot be said as arbitrary action. It is a settled legal principle that the administrative body has the power to cancel any tender notice as per their own discretion. Judicial review is only permissible with reference to the arbitrary action and mala fide action on the part of the authority concerned to select a tenderer but it requires a positive foundation in the pleading of the writ application by assailing such mala fide and arbitrary action with appropriate reference to the allegation as well as making the person concerned involved in such mala fide action as a party in the proceeding.

In the instant case, it is the further case of the appellant that the respondent authority, the Panchayat Samity acted in mala fide manner by recalling the second tender notice. We are afraid to consider such allegation since there is no whisper in the pleading about such mala fide action. It is a settled legal proposition of law now that mere submission of mala fide action will not assist the person concerned to base his case for judicial review until and unless the particulars of such mala fide action are detailed on making the person concerned involved in such mala fide action as a party of the proceeding since the mala fide action is nothing but a mental phenomenon being an action derived from the mind''s reaction which could be answered properly by the person concerned in the event of making such allegation against him. The Apex Court accordingly answered the point in the language that there must be firm foundation of fact pleaded and established and no inference of mala fide could be arose on the basis of insinuation and vague suggestion in the case Rajendra Roy Vs. Union of India (UOI) and Another, . It is also a settled legal proposition by judgment of the Apex Court that against whom any mala fide is alleged he must be impleaded as a party in the proceeding to satisfy the principle of natural justice. Reliance may be placed to the judgment passed in the case I.K. Mishra Vs. Union of India and Others, . In the instant case, there is no ingredient alleged to probe into the point of mala fide as urged. Nobody has been added as a party in this proceeding by name and there is no allegation of mala fide against any person in the writ application. As such, the point as raised has no basis.

So far as the legitimate expectation point is concerned, learned advocate for the appellant has referred many cases in support of his point being the cases Ghaziabad Development Authority and State of U.P. Vs. Delhi Auto and General Finance Pvt. Ltd. and Maha Maya General Finance Co. Ltd. and another, and Food Corporation of India Vs. M/s. Kamdhenu Cattle Feed Industries, All those cases relate to the issue wherein the person concerned who took the plea of legitimate expectation either was a grantee and/or licensee and/or continuing with some work for a longer period and thereby suffered a termination or cancellation and/or selection of a stranger without considering his/her case and on that factual scenario the legitimate expectation principle was applied by the Apex Court. The legitimate expectation principle has no applicability in air, but it requires a space with a foundation that the person concerned who is urging to apply the legitimate expectation principle must set up a ground of such expectation in the nature as has been discussed in those Apex Court judgments. The Apex Court answered the legitimate expectation principle as akin to the principle of natural justice in the case Ashoka Smokeless Coal Ind. P. Ltd. and Others Vs. Union of India (UOI) and Others, in paragraph 83 in the following language "principle of natural justice will apply in cases where there is some right which is likely to be affected by an act of administration. Good administration demands observance of doctrine of reasonableness in other situation also where the citizens may legitimately expect to be treated fairly". The doctrine of legitimate expectation developed in the context of natural justice principle. In this case it appears from the factual matrix that when the first tender was floated wherein the respondent No. 9 was selected but work order was not issued, the present writ petitioner even did not participate in the first tender. The question of participation for the second tender never arose as the second tender was recalled prior to submission of the applications by the tenderers concerned by the administrative decision. Hence, from the facts it appears that the writ petitioner acquired no right so far as acceptance or cancellation of first tender is concerned by the authority which, in fact, is the nucleus of the writ application assailing the selection made in favour of the candidate of first tender. Hence, we are of the reasoned view that the legitimate expectation principle has no applicability. The floating of tender and selection thereof all are within the absolute discretionary jurisdiction of the concerned authority and/or Government. It is a general rule that where a Government invites a tender for a contract, it reserves a right to reject any tender, even the highest amount because the Government has a liberty to choose any person for a contract with a rider that Court may intervene applying the principle of judicial review if and only if in making a choice in the same manner the Government violates Article 14 by excluding the person by discrimination. Reliance may be placed to the case Radhakrishna Agarwal v. State of Bihar, reported in (1997) 3 SCC 457. If the terms and conditions laid down in the tender notice is breached, there is a scope of juridical review. Reliance may be placed to the case Ramana Dayaram Shetty Vs. International Airport Authority of India and Others, . When the action by the authority concerned is unreasonable or contrary to the public interest in terms of the judgment passed in the case Harminder Singh Arora Vs. Union of India (UOI) and Others, , judicial review is permissible. In that case R.D. Shetty (supra) the Apex Court held " it is open to the Government to adopt a policy other than the settlement of a contract by tender hence after tenders have been invited, Government remains free to reject all tenders received and enter into direct negotiation with any person including one of the tenderers".

Having regard to the basic principle of considering any matter relating to the public auction and the tender in terms of the judgment aforesaid, we are not finding any illegality in the action of the Panchayat Samity to have the judicial review of the fact namely issuance of work order to the person concerned of first tender in view of the cancellation of the second tender by themselves which under their discretionary jurisdiction always they were entitled to and furthermore when the writ application was pending filed by the respondent No.9 assailing the action of the Panchayat Samity about their inaction to issue work order in his favour.

Considering the fact of this case and particularly when the writ petitioner was not at all the tenderer of the first tender which has been finalized by issuing the work order, we are of the view that there is no scope of judicial review to identify any action and the writ petitioner as rightly held by the learned trial Judge cannot be said as a party affected by the action impugned to reach the conclusion of non-having any locus standi on the part of the writ petitioner. We are not finding any illegality in the judgment under appeal before us as the learned trial Judge rightly exercised the discretionary power rejecting the writ application on the special fact of the case when already 45% of the work has been completed and part payment have been released in favour of the respondent No. 9.

With that findings and observations, we are not finding any merit in the appeal.

Accordingly, the appeal stands dismissed.

Pranab Kumar Deb, J.

I agree.