Orissa High Court
Case Details
ORISSA HIGH COURT: CUTTACK AFR W.P(C) NO. 13667 OF 2023 In the matter of an application under Articles 226 and 227 of the Constitution of India. --------------- Aparna Sahoo ..… Petitioner -Versus- State of Odisha & Ors. ….. Opp. Parties For petitioner : M/s. S.K. Dash, P.Dash, A.K. Biswal and P. Harichandan, Advocates For opp. parties : Mr. P.P. Mohanty, Addl. Govt. Advocate [O.Ps.1 to 3 & 5] M/s. R.N. Behera, L.K. Padhi and S. Dora, Advocates [O.P.4] P R E S E N T: THE HONOURABLE DR. JUSTICE B.R.SARANGI AND THE HONOURABLE MR JUSTICE MURAHARI SRI RAMAN Date of Hearing : 31.07.2023 :: Date of Judgment: 03.08.2023 DR. B.R. SARANGI,J. The petitioner, by means of this writ petition, seeks to quash the decision taken by the // 2 // opposite parties no.2, 3 & 5 vide Annexure-2 dated 11.04.2023 and Annexure-4 series dated 13.04.2023 and 11.04.2023 in allowing the technical bid of opposite party no.4 and declaring him as the successful bidder in respect of appointment of handling and transport contractor (transport agent) under Mid-Day Meal programme of Balasore district for the year 2023-24, in pursuance of the tender call notice dated 15.03.2023. 2. The factual matrix of the case, in brief, is that opposite party no.2-Collector & District Magistrate, Balasore-cum-Chairman (MDM), Balasore vide Annexure-1 invited a tender call notice on 15.03.2023 for appointment of transport agent under Mid-Day Meal programme in respect of Balasore district for the year 2023-24 from the eligible contractors. As per the said tender call notice, the tender was to be submitted through registered post and the last date for submission of tender was 10.04.2023 at 4.00 PM. The date and time of opening of tender papers was 11.04.2023 at 11.00 AM. Clause-2 of the tender call notice contained the general instructions and guidelines // 3 // for the tenderer. Under Clause-2.3 thereof, it was stipulated that ‘in case the cost of tender paper, EMD and any other document as per Annexure-II is not enclosed with the technical bid, the tender paper shall be rejected’. 2.1 Pursuant to the tender call notice dated 15.03.2023, the petitioner, being an experienced transport and handling contractor having valid license, submitted her bid on 06.04.2023 enclosing all the relevant documents. The tender was opened on 11.04.2023 by the tender committee and the said committee prepared a comparative statement in presence of the representatives of the tenderers and/or tenderers. In the said check list/comparative statement, the tender committee as against opposite party no.4 recorded, in respect of the documents required under column nos.6, 7, 10, 11, 12, 13, 14 and 15, that “Not submitted in Technical Bid but submitted in Main envelope”. Even though opposite party no.4, along with the technical bid, had not submitted the documents required under the columns noted above, his technical // 4 // bid was allowed by the tender committee contravening the conditions stipulated in the tender call notice. 2.2 The authorized representative of the petitioner immediately submitted an objection on 11.04.2023, which was received on 12.04.2023 by the District Education Officer, Balasore, whom the tender was submitted. But, without considering the objection, the tender committee opened the price bid on 13.04.2023 in absence of two members of the tender committee, namely, DSWO, Balasore and R.T.O, Balasore. On the said date, the tender committee drawn a proceeding and declared opposite party no.4 as L-1 and selected him as H & T Contractor (MDM) for the year 2023-24 (up to 30.04.2024). Hence, this writ petition. 3.
Legal Reasoning
Mr. S.K. Dash, learned counsel appearing for the petitioner vehemently contended that the selection of opposite party no.4 as successful bidder is in gross violation of the conditions stipulated in the tender call notice. Thereby, his selection is arbitrary, unreasonable // 5 // and contrary to the provisions of law. Apart from the same, there was gross defect in the decision making process of selecting opposite party no.4 as successful bidder. Nevertheless, the objection raised by the petitioner with regard to disqualification incurred by opposite party no.4 was not considered. Therefore, the decision making process adopted by the opposite parties cannot be sustained in the eye of law and consequentially, the same should be quashed. 4. Mr. P.P. Mohanty, learned Addl. Government Advocate appearing for the State-opposite parties contended that on the date of opening of the tender, as per guidelines, the EMD, technical bid and price bid should be kept in the main envelope and at the time of opening of the envelops, it was found that all envelopes were found in order, but some papers of technical bid (check list of Annexure-II) of opposite party no.4 were not kept in the technical bid envelop, but those documents were kept in the main envelop. It is further contended that opposite party no.4 had quoted the lowest amount of Rs.127/- per quintal, whereas the // 6 // petitioner had quoted Rs.148.70 per quintal and another bidder, namely, Sri Surenjan Barik had quoted Rs.149.09 per quintal. Therefore, opposite party no.4 was selected and appointed as transport contractor. Thereby, no illegality or irregularity has been committed by the tender committee in selecting opposite party no.4 as successful bidder. 5. Mr. R.N. Behera, learned counsel appearing for opposite party no.4 vehemently contended that pursuant to bid invitation notice of re-tender for transportation of MDM food grain in Balasore district issued on 15.03.2023, opposite party no.4, being eligible, submitted his technical and financial bid along with tender papers, cost of Rs.20,000/- (non- refundable) within time to the office of the District Education Officer, Balasore. The tender paper was opened on the given date and time in the bid invitation notice (Annexure-I), where opposite party no.4 came out successful and other two tenderers became unsuccessful. Therefore, the work was allotted in favour of opposite party no.4. It is further contended that // 7 // opposite party no.4 submitted all the relevant documents, as stipulated under Claue-7 (tenderer process) of the tender call notice, i.e., Annexure-1 (Technical Bid), Annexure-II (Check list), Annexure-III (Declaration), Annexure-IV (price bid) and Annexure-V. On consideration of the same, opposite party no.4 was declared successful bidder. Therefore, the writ petition at the instance of the petitioner should be quashed. 6. This Court heard Mr. S.K. Dash, learned counsel appearing for the petitioner; Mr. P.P. Mohanty, learned Addl. Government Advocate appearing for the State-opposite parties and Mr. R.N. Behera, learned counsel appearing for opposite party no.4 in hybrid mode. Pleadings have been exchanged between the parties and with the consent of learned counsel for the parties, the writ petition is being disposed of finally at the stage of admission. 7. Before delving into the issue involved in this case, the relevant provisions contained in the bid invitation notice of re-tender for transportation of MDM // 8 // food grain in Balasore district under Annexure-1 dated 15.03.2023 are quoted below:- “2. General Instruction and Guidelines for the Tenderer:- 2.3. In case the cost of Tender Paper, EMD and is not any document as per ANNEXURE-II enclosed with the Technical Bid, the Tender Paper shall be rejected. 2.4. The District Tender Committee reserves the right to negotiate with the Tenderer for a workable rate. xxx xxx xxx 7. Tenderer Process:- 7.1 Tenderer participating in the tender process shall submit a technical bid & price bid in response to the Tender call notice. 7.2 Earnest Money Deposit (EMD), Technical Bid and Price Bid shall be contained in separate sealed envelopes clearly marked “EMD”, “Technical Bid” & “Price Bid” as per norms specified below. 7.2.1 First sealed envelope will contain only the EMD. This envelope shall be marked “PART-I- EMD”. 7.2.2. Second sealed envelope will contain the Technical Bid list (Annexure-II) & Declaration (Annexure-III) & solvency certificate. This envelope shall be marked: “PART-II-TECHNICAL BID”. (Annexure-1), check 7.2.3 Third sealed envelope will contain the Price Bid (Annexure-IV), of this envelope shall be marked PART-III-PRICE BID. 7.2.4. FOURTH sealed envelope will contain all the THREE envelopes sealed separately i.e. EMD, TECHNICAL BID & PRICE BID with superscription “TENDER FOR APPOINTMENT // 9 // OF TRANSPORTING AGENT UNDER M.D.M PROGRAMME IN BALASORE DISTRICT.” xxx xxx xxx 8.4. Information about Tenderers. The Tenderers must furnish full, precise, correct and accurate details of information asked for in the Tender documents. Technical Bid & Price Bid. xxx xxx xxx 30. Instruction to fill up the Technical Bid:- “30.1 The Tenderer shall go through the Tender Documents thoroughly before filing the Technical Bid (Annexure-I) and submitting the same at Office of the DEO Balasore. 30.2. The number of pages in the Tender Paper and Tender Document to be checked to ascertain that all the pages are intact. 30.3 The Technical Bid has to be filled neatly and there shall be no overwriting. 30.4 All the columns of the Technical Bid have to be filled Column which is not required to be filled by a Tendered, a cross mark (X) has to be given against that Column. 30.5 The Tenderer shall affix a self attested pass port size photograph on the Technical Bid at the specified space. 30.6 The Tenderer shall enclose the cost of Tender Paper. 30.7 The tenderer shall enclose the cost of EMD of requisite amount. 30.8 All the documents as per the Check List (Annexure-II) have to be . 30.9 Conditional Bid shall not be accepted. 30.10 In case any Forged Documents noticed during verification of documents or period of Agreement, the EMD & Security Deposit as the case may be shall be forfeited. // 10 // 30.11 The Tenderer shall submit an declaration stating the fact that he has agreed to the conditions, terms and other details of the Tender Paper and Documents (Annexure-III). 30.12 The Tender Paper, Tender Document, Technical Bid and copy of the documents (Annexure-II) & declaration (Annexure-III) have to be signed by the Tenderer. to be enclosed as per 30.13 Documents Annexure have to be attested by the Notary Public. 30.14 All the pages of the Tender paper should be duly signed by the Tenderer.” Annexure-II states about Check List which categorically speaks about the document to be attached with the technical bid. 8. If aforementioned provisions of the bid invitation notice are carefully perused, it would be seen that Clause-2.3 clearly provides that in case the cost of tender paper, EMD and any document as per Annexure- II is not enclosed with the technical bid, the tender paper shall be rejected. Clause-7 deals with Tenderer Process. Under Clause-7.2.2 it is clarified that second sealed envelope will contain the Technical Bid (Annexure-1), check list (Annexure-II) & Declaration (Annexure-III) & solvency certificate. The said envelope shall be marked “PART-II-TECHNICAL BID”. Clause- 7.2.3 envisages that Third Sealed Envelope will contain // 11 // price bid and Clause-7.2.4 states that Fourth Sealed Envelope will contain all the three envelopes sealed separately, i.e., EMD, technical bid and price bid with superscription “TENDER FOR APPOINTMENT OF TRANSPORTING AGENT UNDER M.D.M. PROGRAMME IN BALASORE DISTRICT”. Clause-7.3 provides that envelope containing technical bid will be opened first and Clause-7.4 states that price bid of the tenderer, who qualifies in the technical bid shall be opened and considered. In Clause-8.4, it has been stated that the tenderer must furnish full, precise, correct and accurate details of information asked for in the tender documents, technical bid and price bid. Similarly, Clause-30 deals with the instruction to fill up the technical bid. Annexure-1 of the tender documents relates to technical bid, which specifies filing of different documents. Annexure-II of the tender documents relates to check list, which speaks about the documents to be attached with the technical bid. Therefore, these are the requirements to be fulfilled by the tenderers pursuant to bid invitation notice. // 12 // 9. Pursuant to such notice inviting tender, the petitioner, opposite party no.4 and one Surenjan Barik submitted their bids within the specified date and time and their tender papers were also opened on the date and time fixed by the tender committee, i.e., 11.04.2023. The tender committee also prepared a check list/comparative statement in presence of the representatives of the tenderers. In the said check list/comparative statement, the tender committee stated as against opposite party no.4, in respect of the documents required under column nos.6, 7, 10, 11, 12, 13, 14 and 15, that “Not submitted in Technical Bid but submitted in Main envelope”. Since the documents filed in the main envelope were taken into consideration, opposite party no.4 was selected as successful bidder. 10. Therefore, the question arises if the tender conditions stipulate in Clauses-7.2.1, 7.2.2 and 7.2.3 a specific mode of submission of documents, whether any deviation thereof can be legally permissible and if any relaxation has been made by the tender committee for determination of the bid in favour of opposite party // 13 // no.4, in that case whether the tender committee has acted in consonance with the tender conditions or not. 11. As per Clause-7.2.1 of the tender documents, first sealed envelope will contain only the EMD and the said envelope shall be marked “PART-I-EMD”. Clause- 7.2.2 states that second sealed envelope will contain the Technical Bid (Annexure-1), Check List (Annexure-II) & Declaration (Annexure-III) & solvency certificate. The said envelope shall be marked as “PART-II-TECHNICAL BID”. Similarly, Clause-7.2.3 indicates that “Third sealed envelope will contain the Price Bid (Annexure- IV), of this envelope shall be marked PART-III-PRICE BID. Clause-7.2.4 indicates that fourth sealed envelope will contain all the three envelopes sealed separately i.e. EMD, technical bid & price bid with superscription “TENDER FOR APPOINTMENT OF TRANSPORTING AGENT UNDER M.D.M. PROGRAMME IN BALASORE DISTRICT”. Therefore, each envelope contains relevant documents for each category. If any of the tender conditions is not satisfied, then, as per Clause-2.3 of the bid inviting notice, the tender paper shall be // 14 // rejected. As such, there is no relaxation clause available in the bid documents. Therefore, a tenderer should adhere to Clauses-7.2.1 to 7.2.4 scrupulously. Clause- 30 of the bid invitation notice states about instruction to fill up the technical bid. As per Clause-30.1, the tenderer shall go through the tender documents thoroughly before filling the technical bid (Annexure-1) and submitting the same at Office of the DEO Balasore. Similarly, Clause-30.8 states that all the documents, as per the check list (Annexure-II), have to be submitted. Since a mode has been prescribed how to submit bid and if it is not adhered to, there is defect in submission of technical bid. 12. In Shiv Sagar Tiwari v. Union of India and Ors., AIR 1997 SC 1483. The apex Court held that whatever procedure the Government proposes to follow in accordance with the tender must be clearly stated in the tender notice. The consideration of the tender received and procedure followed in the matter of acceptance of tender should be transparent, fair and open. // 15 // Similar view has also been taken in Common Cause v. Union of India, 1996 (6) SCC 593. 13. After opening of the technical bid, a comparative statement was prepared. The tender committee also recorded, so far as columns no.6, 7, 10, 11, 12, 13, 14 & 15 are concerned “not submitted in technical bid but submitted in the main envelope” which is apparent from the document annexed as
Decision
Annexure-2 to the writ petition. Thereby, opposite party no.4 has violated the condition stipulated under Clause-7.2.2 of the bid invitation notice. As a consequence thereof, he, having not adhered to the tender conditions, has incurred disqualification and any relaxation given by the tender committee is in gross violation of the said clause. 14. It may be contended that it is too technical to take such a plea. But Clauses-7.2.1 to 7.2.4 of the bid invitation notice prescribe the specific mode that cannot be ignored on mere understanding of technical defect. There is some meaning attached to each of the clause to // 16 // be adhered to for the purpose of consideration of selection of tenderer. If in violation thereof the tender committee selects, the decision has to be considered illegal, arbitrary and contrary to the provisions of law. This fact has been admitted in paragraph-6 of the counter affidavit filed by opposite party no.3, which is quoted below:- “6. ……. It is humbly submitted that on the date of opening of the tender, as per guidelines, the EMD, technical bid and the price bid should be kept in the main envelope and at the time of opening of the envelopes, it was found that all envelopes were found in order, but some papers of technical bid (Check list of Annexure-II) of the Opp. Party No.4 were not kept in the Technical Bid envelop, but those documents were kept in the main envelope.” From the above, it can be safely inferred that what has been stated by the tender committee in their comparative statement in respect of the technical bid, the same has been duly acknowledged in the counter affidavit filed by opposite party no.3. As such, opposite party no.4 has taken a contrary stand in paragraph-6 of his counter affidavit. But the comparative statement of technical bid under Annexure-2, to which the representative of opposite party no.4 is also a signatory, // 17 // clearly states what the technical committee has noted. Thereby, opposite party no.4, having acknowledged the defect in his own tender document, cannot take a different stand than that has been recorded in the document placed on record as Annexure-2. Once opposite party no.4 has acknowledged the recording of the tender committee made in Annexure-2 by putting his signature therein, which has been duly endorsed in the counter affidavit filed by opposite party no.3, viz., the tendering authority, who is also a party to the tender committee, any action taken or any stand taken by opposite party no.4 bereft of any document available cannot be sustained in the eye of law. 15. It may be noted that in exercise of power of judicial review in respect of contracts entered into on behalf of the State or instrumentality of the State, such as Corporation, the Court prima facie concerns whether there has been any infirmity in the decision making process. In that case, the Court can examine whether the decision making process was reasonable, rationale // 18 // not arbitrary and not violative of Article-14 of the Constitution of India. 16. In Sterling Computers Ltd. v. M & N Publications Ltd. (1993) 1 SCC 445, the apex Court observed as under:- “18. While exercising the power of judicial review, in respect of contracts entered into on behalf of the State, the court is concerned primarily as to whether there has been any infirmity in the ‘decision-making process’. … the courts can certainly examine whether ‘decision- making process’ was reasonable, rational, not arbitrary and violative of Article 14 of the Constitution.” 17. In Tata Cellular v. Union of India, (1994) 6 SCC 651 : AIR 1996 SC 11, the apex Court, referring to the limitations relating to the scope of judicial review of administrative decisions and exercise of powers in awarding contracts, held to the following effect:- “(1) The modern trend points to judicial restraint in administrative action. (2) The court does not sit as a court of appeal but merely reviews the manner in which the decision was made. (3) The court does not have the expertise to correct the administrative action. If a review of the administrative decision is permitted it will be substituting the necessary expertise which itself may be fallible. its own decision, without // 19 // (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. … More often than not, such decisions are made qualitatively by experts. (5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or the quasi-administrative the decision must not only be of of Wednesbury application reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides. sphere. However, tested by principle (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure.” The apex Court also noted that there are inherent limitations in the exercise of power of judicial review in contractual matter. As such, it was observed that the duty to act fairly will vary in extent, depending upon the nature of cases, to which the said principle is sought to be applied. It was further held that the State has the right to refuse the lowest or any other tender, provided it tries to get the best person or the best quotation, and the power to choose is not exercised for any collateral purpose or in infringement of Article 14. // 20 // 18. In Air India Ltd. v. Cochin International Airport Ltd. (2000) 2 SCC 617, the apex Court, while summarizing the scope of interference as enunciated in several earlier decisions, held as follows:- are are paramount “7. … The award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision considerations commercial which considerations. The State can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. It can enter into negotiations before finally deciding to accept one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to be the highest or the lowest. But the State, its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot that depart decision is not amenable to judicial review, the court can examine the decision-making process and interfere if it is found vitiated by mala fides, unreasonableness and arbitrariness. The State, its corporations, instrumentalities and agencies have to all concerned. Even when some defect is found in the decision-making process the court must exercise its discretionary power under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should intervene.” them arbitrarily. Though the public duty to be from fair // 21 // 19. The scope of judicial review has also been taken into consideration elaborately in Jagdish Mandal v. State of Odisha, (2007) 14 SCC 517. In paragraph- 22 of the said judgment, the apex Court held as follows:- “…………..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 tenderer/contractor or consequences on a (allotment of largesse distribution of State sites/shops, grant of licences, dealerships and franchises) stand on a different footing as they may require a higher degree of fairness in action.” Similar view has also been reiterated in Michigan Rubber (India) Limited v. State of Karnatak, (2012) 8 SCC 216 and Maa Binda Express Carrier v. North East Frontier Railway, (2014) 3 SCC 760. // 22 // 20. In Vidarbha Irrigation Development Corporation v. M/s Anoj Kumar Agarwalla), (2020) 17 SCC 577, the apex Court, in paragraph-16 of the judgment, held as under:- “16. It is clear even on a reading of this judgment that the words used in the tender document cannot be ignored or treated as redundant or superfluous they must be given meaning and their necessary significance. Given the fact that in the present case, an essential tender condition which had to be strictly complied with was not so complied with, the appellant would have no power to condone lack of such strict compliance. Any such condonation, as has been done in the present case, would amount to perversity in the understanding or appreciation of the terms of the tender conditions, which must be interfered with by a constitutional court.” Since in the instant case opposite party no.4 has not complied with the conditions, as stipulated in the tender notice, and the committee has decided to make a verification and confirmation from the concerned authorities, instead of doing so, the same could not have been settled in favour of opposite party no.4. 21. In Afcons Infrastructure Limited v. Nagpur Metro Rail Corporation Limited, (2016) 16 SCC 818, // 23 // the apex Court held that the constitutional courts are concerned with the decision making process. A decision if challenged (the decision having been arrived at through a valid process), the constitutional Courts can interfere if the decision is perverse. However, the constitutional Courts are expected to exercise restraint in interfering with the administrative decision and ought not substitute its view for that of the administrative authority. 22. Considering the facts and law, as discussed above, since the selection of opposite party no.4 as a transport agent has been made in gross violation of the tender conditions contained in Annexure-1, this Court, in exercise of power under judicial review, as the decision making process for selection of opposite party no.4 is arbitrary, unreasonable and contrary to the provisions of law and violates the terms and conditions of the tender, holds that the same cannot be sustained in the eye of law. Accordingly, the decision of the tender committee taken, vide Annexure-2 dated 11.04.2023 and Annexure-4 series dated 13.04.2023 and // 24 // 11.04.2023, in selecting opposite party no.4 as transport agent, pursuant to bid invitation notice under Annexure-1 dated 15.03.2023, is liable to be quashed and is hereby quashed. As a consequence thereof, this Court directs opposite party-authorities to go for a fresh tender in conformity with the provisions of law for appointment of transport agent under M.D.M. programme in respect of Balasore district for the year 2023-24. 23. In the result, the writ petition stands allowed, but, however, under the circumstances of the case there shall be no order as to costs. (DR. B.R. SARANGI) JUDGE M.S. RAMAN, J. I agree. (M.S. RAMAN) JUDGE Signature Not Verified Digitally Signed Signed by: ALOK RANJAN SETHY Designation: Secretary Reason: Authentication Location: Orissa High Court Date: 03-Aug-2023 16:39:09 Orissa High Court, Cuttack The 3rd August, 2023, Alok