High Court · 2024
Legal Reasoning
wp-3153.241 IN THE HIGH COURT OF JUDICATURE AT BOMBAYBENCH AT AURANGABADWRIT PETITION NO.3153 OF 2024Bhagyadeep Industrial Co-operativeSociety Ltd., Having its registeredOffice address at N-11, F 21/7, Hudco,Aurangabad-431 003,Through its Member,Sachin S/o Sadashiv Birare,Age-38 years, Occu:Service,R/o-Navjivan Colony, Hudco,Chh. Sambhajinagar. ...PETITIONER VERSUS 1) The State of Maharashtra, Through its Principal Secretary, Election Commission, Mantralaya, Mumbai-32,2) The Collector and District Election Officer, Office of the District Collector, Election Branch, Jalgaon,3) Mangal Mandap decorators, Through its Proprietor, Kailash Diama, Age-40 years, Occu:Business, R/o-Station Road, Chalisgaon, Dist-Jalgaon. ...RESPONDENTS ... Mr. P.R Katneshwarkar Advocate for Petitioner. Mr. A.M. Phule, A.G.P. for Respondent Nos. 1 and 2. Mr. S.S. Thombre Advocate for Respondent No.3. ...
Legal Reasoning
wp-3153.242 CORAM: SMT. VIBHA KANKANWADI AND S.G. CHAPALGAONKAR, JJ.DATE OF RESERVING JUDGMENT : 1st APRIL 2024DATE OF PRONOUNCING JUDGMENT : 10th MAY 2024 JUDGMENT [PER SMT. VIBHA KANKANWADI, J.] :1.Rule. Rule made returnable forthwith. Heard learnedcounsel appearing for the respective parties finally, by consent.2.The petitioner challenges rejection order dated 15th March2024 intimated by respondent No.2 to him through E-mailregarding rejection of the tender proposal presented by thepetitioner in tender notice No. NIVAD-1/KAVI/254/2024, dated15th February 2024. The petitioner also prays to directrespondent No.2 to hold the petitioner as qualified bidder.3.The facts which are not in dispute are that respondentNo.2 had floated tender No. NIVAD-1/KAVI/254/2024 for supplyof various services like erecting pendal, giving furniture andother articles on rent for the upcoming Lok Sabha and VidhanSabha General Elections. The petitioner has submitted online bidon 5th March 2024 and had also paid an amount of Rs.2,40,000/- wp-3153.243towards the tender fee. Respondent No.2, upon verification ofdocuments of four participants, disqualified the petitioner bystating that the petitioner is not having experience of five yearsin two entire Districts at a time as stated in term /condition No.7of the E-tender, as regards the Envelope No.1 (TechnicalEnvelope) is concerned. It is further an admitted position that inthe said tender, respondent No.3 has been issued work order.4.The petitioner has come with the case that in fact thepetitioner completed the work in Pune District as well as ThaneDistrict at the same time in last five years, which was in respectof Lok Sabha elections. The petitioner had produced certificatesof competent authority to that extent. The petitioner hadcompleted the work in respect of entire Pune District and hadcompleted the work of part of Thane District. The certificatesissued by the competent authority were not considered byrespondent No.2. The petitioner also contends that the petitionerhad filled tender in respect of Nashik District also for similarE-tender having similar terms and conditions. He was held to bequalified for condition No.7. But the tender was rejected oncondition No.8 i.e. experience certificate from the competentauthority showing the works related to Lok Sabha / VidhanSabha elections carried for an amount equal to 80% of the wp-3153.244estimated amount mentioned in the said tender has not beenattached by the petitioner with the bid application. The petitionerhas challenged the said rejection by way of writ petition, beforethe Principal Seat of this Court. According to the petitioner theinterpretation, in respect of term / condition No.7 as regards theEnvelope No.1 of the tender document, has been wronglypressed into service by respondent No.2 and therefore, therejection is illegal.5.Learned Advocate Mr. Katneshwarkar appearing for thepetitioner has taken us through all the documents, especially thetender conditions wherein as regards the Envelope No.1(Technical Envelope) a list has been given of the documents. Weare more concerned with term / condition No.7 of the said list ofdocuments, which runs thus:-“7.ekxhy 5 o”kkZP;k dkyko/khr yksdlHkk lkoZf=d fuoM.kwdhr 2ftYg~;kauk ,dkp osGh dke dsY;kckcrp eaMi] QfuZpj o brj vuq”kafxdlkfgR; HkkMs rRokoj iqjoBk dsY;kckcrps l{ke izkf/kdkjh ;kauh fnysysvuqHko izek.ki= tksM.ks vko’;d vkgs-”.English translation of the above-said term / condition No.7is as under:- wp-3153.245“7.It is necessary to attach an experiencecertificate issued by the Competent Authorityregarding the supply of pendal (pavilion), furnitureand other ancillary materials on lease for serving 2districts simultaneously in the Lok Sabha GeneralElections during the last 5 years.” (Translated by Senior Translator and Interpreter, High Court of Bombay, Bench at Aurangabad)6.Learned Advocate for the petitioner has then taken usthrough the certificate issued by Additional Assistant ElectionOfficer, 24-Kalyan Lok Sabha Constituency, 141-UlhasnagarVidhan Sabha Constituency, dated 20th June 2019, stating that inthe elections of Lok Sabha the petitioner was given the contractand he has done the work for Kalyan as well as Ulhasnagarconstituencies. He also points out the revised certificate dated 5thJanuary 2024 issued by the Deputy Collector cum Deputy DistrictElection Officer, Pune regarding supply of the material in LokSabha General Elections for 2019 for the entire Pune District.Learned Advocate categorically mentions that the petitioner isnot challenging the term / condition No.7 but the petitionerchallenges the interpretation that has been put by respondentNo.2. Condition No.7 does not, in any manner, speaks that thework should have been done in the entire District. If the work is wp-3153.246allotted to many persons / contractors by the competentauthority by dividing, then it cannot be said that on his volitionthe said contractor has not carried out the work in the entireDistrict. He, therefore, prays for setting aside the rejection of thebid of the petitioner and holding him as qualified. 7.Learned AGP relies on the affidavit-in-reply filed by KishorAmbadas Kadam, Tahasildar (Election) at Collector Office,Jalgaon. It has been filed on behalf of respondent No.2 whereinit has been submitted that the interpretation put by thecommittee who was managing the tender process, is correct.The petitioner has not done the work for entire Thane District,which was the condition precedent in condition No.7. This Courtat Nagpur Bench in Meenakshi Traders vs. the State ofMaharashtra and others (Writ Petition No.7006 of 2023 andother connected matters), decided on 17th October 2023, hadheld that there is no fundamental right available to any of thetenderers to do business with the Government, what to sayabout business with Government on their own conditions. It wasfound that the tender conditions, especially condition Nos. 7 and8 were held to be having some rational and should be germaneto the nature of work to be performed by the tenderer. It hasbeen further pointed out on behalf of respondent No.2 that wp-3153.247before the committee there were four tenderers and the otherthree tenderers had worked for two entire Districts andtherefore, if the preference is given to respondent No.3, then thepetitioner cannot be said to be aggrieved. 8.Learned AGP relies on the said decision of this Court,Bench at Nagpur in Meenakshi Traders vs. the State ofMaharashtra and others (supra) as well as decision in M/s.Agmatel India Pvt. Ltd. vs. M/s Resoursys Telecom, AIR 2022 SC1103, wherein it has been observed that :-“The author of the tender document is taken to be the bestperson to understand and appreciate its requirements; andif its interpretation is manifestly in consonance with thelanguage of the tender document or sub-serving thepurchase of the tender, the Court would prefer to keeprestraint. Further to that, the technical evaluation orcomparison by the Court is impermissible; and even if theinterpretation given to the tender document by the personinviting offers is not as such acceptable to the ConstitutionalCourt, that, by itself, would not be a reason for interferingwith the interpretation given.” 9.Respondent No.3 has filed affidavit-in-reply and submitsthat he had produced all those necessary documents which havebeen considered by respondent No.2 and appropriate decisionhas been taken. Learned Advocate for respondent No.3 alsorelies on the decision in Meenakshi Traders vs. the State ofMaharashtra and others (supra) to say that condition No.7 has wp-3153.248been upheld by this Court. Learned Advocate for respondentNo.3 then relies on following decisions:-“ (1)N.G. Projects Limited vs. Vinod Kumar Jain and others,AIR 2022 SC 1531,(2)Jagdish Mandal vs. State of Orissa and others, (2007)14 SCC 517,(3)Central Coalfields Limited and others vs. SLL-SML(Joint Venture Consortium) and others, AIR 2016 SC 3814,(4)Ramana Dayaram Shetty vs. International AirportAuthority of India and others, AIR 1979 SC 1628,(5)Michigan Rubber (India) Ltd. vs. the State ofKarnataka and others, AIR 2012 SC 2915,(6)Afcons Infrastructure Ltd. vs. Nagpur Metro RailCorporation Ltd. and others, AIR 2016 SC 4305,(7)The Silppi Constructions Contractors vs. Union of India(UOI) and others, (2020) 16 SCC 489,(8) Uflex Ltd. vs. Government of Tamil Nadu and others,(2022) 1 SCC 165,(9) Galaxy Transport Agencies, Contractors, Traders,Transports and Suppliers vs. New J.K. Roadways, FleetOwners and Transport Contractors and others,MANU/SC/0959/2020,(10)Santosh Sakharam Chandre vs. the State ofMaharashtra and others, decided by this Court on 15th March2023 (Writ Petition No.112 of 2022).”10.As aforesaid, this is a question of interpretation ofCondition No.7 as regards the Envelope No.1 of the tenderdocument. It is quite clear that Condition No.7 does not use the wp-3153.249word “ iw.kZ “ (whole) specifically. But certainly respondent No.2was aware about the fact that in a District there can be two ormore constituencies, yet Condition No.7 was not so worded.Here we are aware that in Meenakshi Traders vs. the State ofMaharashtra and others (supra), challenge was to Condition Nos.7 and 8 but perusal of the said Judgment would show that thesaid challenge was on different footing. It was stated that thesaid conditions were absolutely arbitrary, unreasonable andsuffers from the vice of mala fides and therefore, prayer was toquash those conditions. But this Court, by order dated 17thOctober 2023, upheld those conditions and dismissed the WritPetition. At the cost of repetition, it can be said that the presentPetition is based on the alleged wrong interpretation put byrespondent No.2 of Condition No.7 of the tender document. Inother words, there was no intention the part of the petitioner tochallenge the legality, validity of Condition No.7 in the presentPetition. Therefore, certainly we cannot dispose of the WritPetition only on the basis of the decision in Meenakshi Tradersvs. the State of Maharashtra and others (supra). 11.Now coming to the challenge by the petitioner, certainlythe petitioner had produced on record two certificates issued bytwo competent authorities. There is no issue in respect of wp-3153.2410certificate issued by the competent authority from Pune. Itclearly says that the petitioner had done the work in respect ofentire Pune District. However, as regards the another certificateis concerned, it is issued by the Election Officer who wasconcerning to Kalyan Lok Sabha constituency and UlhasnagarVidhan Sabha constituency. The petitioner has produced thetender invited by the District Collector and District ElectionOfficer, Thane and also the work order issued to the petitioner. Itappears that though the tender was in respect of entire ThaneDistrict, the work order says that the work was divided amongstnine contractors and in the said division, work of Kalyan andUlhasnagar was given to the petitioner. Now the petitionercannot be faulted for such division of work but it appears thatthe said division / distribution of the work was never challengedeither by the petitioner or by any of the other eight contractors.Now the certificate has been given only in respect of particularconstituencies. Whether to accept the same for the entire Districttaking into consideration the fact that the said work order was inpursuant to the E-tender for the entire District, will have to beleft to present respondent No.2. That liberty is available torespondent No.2 in view of M/s. Agmatel India Pvt. Ltd. vs. M/sResoursys Telecom (supra). wp-3153.241112.We are aware of the decision in Jagdish Mandal Vs. Stateof Orissa, (2007) 14 SCC 517, wherein Hon’ble Supreme Courthas held that :-“22.Judicial review of administrative action is intendedto prevent arbitrariness, irrationality; unreasonableness,bias and mala fides. Its purpose is to check whetherchoice or decision is made “lawfully” and not to checkwhether choice or decision is “sound”. When the powerof judicial review is invoked in matters relating totenders or award of contracts, certain special featuresshould be borne in mind. A contract is a commercialtransaction. Evaluating tenders and awarding contractsare essentially commercial functions. Principles of equityand natural justice stay at a distance. If the decisionrelating to award of contract is bona fide and is in publicinterest, courts will not, in exercise of power of judicialreview, interfere even if a procedural aberration or errorin assessment or prejudice to a tenderer, is made out.The power of judicial review will not be permitted to beinvoked to protect private interest at the cost of publicinterest, or to decide contractual disputes. The tendereror contractor with a grievance can always seek damagesin a civil Court. Attempts by unsuccessful tenderers withimaginary grievances, wounded pride and businessrivalry, to make mountains out of molehills of sometechnical/procedural violation or some prejudice to self,and persuade courts to interfere by exercising power ofjudicial review, should be resisted. Such interferences,either interim or final, may hold up public works foryears, or delay relief and succour to thousands and
Decision
wp-3153.2412millions and may increase the project cost manifold.Therefore, a Court before interfering in tender orcontractual matters in exercise of power of judicialreview, should pose to itself the following questions :(i) Whether the process adopted or decision made bythe authority is mala fide or intended to favour someone;orWhether the process adopted or decision made is soarbitrary and irrational that the court can say: “thedecision is such that no responsible authority actingreasonably and in accordance with relevant law couldhave reached”;(ii)Whether public interest is affected.If the answers are in the negative, there should be nointerference under Article 226. Cases involvingblacklisting or imposition of penal consequences on atenderer/contractor or distribution of State largesse(allotment of sites/shops, grant of licences, dealershipsand franchises) stand on a different footing as they mayrequire a higher degree of fairness in action.”13.We would like to rely on the observations from the recentdecision by the Hon’ble Supreme Court in M/s. N.G. ProjectsLimited (Supra), in which the earlier decisions have been takennote of and it has been observed that :-“23.In view of the above judgments of this Court, theWrit Court should refrain itself from imposing its decisionover the decision of the employer as to whether or not toaccept the bid of a tenderer. The court does not have wp-3153.2413the expertise to examine the terms and conditions of thepresent-day economic activities of the State and thislimitation should be kept in view. Courts should be evenmore reluctant in interfering with contracts involvingtechnical issues as there is a requirement of thenecessary expertise to adjudicate upon such issues. Theapproach of the Court should be not to find fault withmagnifying glass in its hands, rather the Court shouldexamine as to whether the decision-making process isafter complying with the procedure contemplated by thetender conditions. If the Court finds that there is totalarbitrariness or that the tender has been granted in amala fide manner, still the Court should refrain frominterfering in the grant of tender but instead relegate theparties to seek damages for the wrongful exclusionrather than to injunct the execution of the contract. Theinjunction or interference in the tender leads toadditional costs on the State and is also against publicinterest. Therefore, the State and its citizens suffertwice, firstly by paying escalation costs and secondly, bybeing deprived of the infrastructure for which theypresent-day Governments are expected to work.”14.The scrutiny-sheet produced along with the affidavit-in-reply of respondent No.3 would show that the other biddersappears to have worked for entire two or more Districts and thepetitioner was the only bidder whose second certificate was notin respect of the entire District. Therefore, the interpretation putby respondent No.2 cannot be said to be with mala fide intentionor arbitrary. The disqualification can be said to be justified. No wp-3153.2414case is made out for exercise of the constitutional powers of thisCourt and the Writ Petition deserves to be dismissed.14.Accordingly, the Writ Petition stands dismissed. Rule standsdischarged. [S.G. CHAPALGAONKAR] [SMT. VIBHA KANKANWADI] JUDGE JUDGEasb/MAY24