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Judgment
Dr. AR. Lakshmanan, J.—This petition raises a very interesting question of law. The petitioner Birla International Marketing Corporation, New Delhi/Cochin - submitted a tender through their Delhi Office along with an Earnest Money Deposit of Rs. 3,00,000/- in the form of Demand Draft drawn in favour of the respondent. The tender documents and the enclosures along with the covering letter were submitted to the respondent within the validity period. They are marked as Exts''.Pl(a) to Pl(j)- The tender documents were opened on 4-8-1999 and no defect of whatsoever nature was found or brought to the notice of the representative of the petitioner; nor the tender was rejected. Technical evaluation was also made, but no feedback was received thereafter. By letter dated 8-10-1999, the petitioner brought to the notice of the respondent that they have already submitted the tender documents and that they were also stamped in all the pages, and that by oversight and due to an inadvertant omission or slip, the K.F.C. Form No. 14 was omitted to-be signed, though stamped. Hence, the petitioner once again enclosed K.F.C. Form No. 14 duly stamped and signed with their assurance with all the terms and conditions of tender has been accepted as confirmed in their earlier letter dated 29-7-1999. This letter is marked as Ext.P2. It is pertinent to notice that the respondent did not communicate any decision regarding the tender submitted by the petitioner until they received Ext.P2 letter. But, subsequent to the receipt of Ext.P2, the respondent by their letter dated 27-10-1999 informed the petitioner that the tender submitted by them is seen unsigned and hence he is not in a position to accept the tender. This order is marked as Ext.P3. Ext.P3 reads thus:
" No. H3-11497/99
Office of the Director of Survey and Land Records, Thiruvananthapuram. Dated: 27-10-1999.
From
The Survey Director
To
Birla International Marketing Corporation, 41 Basant Lok Community Centre, 2nd Floor, Vasant Vihar, New Delhi-110057.
Sir
Sub:- Survey and Land Records Department - Purchasing of
Total Stations - Reg.
Ref:- 1. Your tender dated 4-8-99.
Your letter No. BIMC/TPD/99/748 dt. 8-10-99.
Please see the reference cited.
As per Kerala Store Purchase Mannual Rule 31 (a)(iii), it is stated '' that tenders have to be rejected when the tender is not signed by the tenderer.
The tender submitted by you as per the reference 1st cited is seen unsigned by the tenderer. So I am not in a position to accept your tender.
Yours faithfully,
Sd/- for Survey Director".
This writ petition has been filed to quash Ext.P3 and for a mandamus directing the respondent to consider the tender submitted by the petitioner on merits and evaluate the same with the other tenders and to award the, contract after such consideration only and to forbear the respondent from awarding any contract or doing any act in furtherance thereto until the consideration of the tender submitted by the petitioner on merits. The writ petition has been contested by the respondent. A statement by the Junior Superintendent, Office of the Director of Survey & Land Records dated 6-12-1999 and a counter affidavit by the Additional Director of Survey and Land Records dated 10-1-2000 were filed. According to the respondent, the tender has to be submitted in the prescribed form and, though the petitioner has submitted the lender in the prescribed form, the tender form was not signed by the tenderer, which is in violation of Rule 3l(a)(iii) of Kerala Store Purchase Mannual, wherein it is staled that tender has lo be rejected with the tender is not signed by the tenderer. In the counter affidavit it is submitted that since the tender form is unsigned by the tenderer, the same cannot be accepted, and that as per clause 3l(a)(iii) of the Kerala Store Purchase Mannual, such tender has to be rejected when the tender is not signed by the tenderer.
When C.M.P.47359/1999 came up on 29-11 -1999, this court ordered the status-quo as on that date. The said order was extended subsequently.
We heard Mr.P.R. Raman for the petitioner and Smt.Molly Jacob, Government Pleader, for the respondent.
Under clause 31(a) of the Stores Purchase Mannual, it has been specified that tenders which are in the prescribed form and are accompanied by the requisite Earnest Money Deposit shall be included for consideration, provided they have been received before the time prescribed for their receipt. It has been further stipulated therein that tenders shall be excluded in the following cases:
(i) When the tenders are not in the prescribed form;
(ii) When the tender is not accompanied by requisite earnest money;
(iii) When the tender is not signed by the tenderer;
(iv) When the lender is from a black-listed firm or a banned firm; and
(v) When the tender is received late.
In the light of the above provision, Smt. Molly Jacob, learned Government Pleader submitted that the tender submitted by the petitioner, which is not properly signed, cannot be accepted and that the petitioner is not having any legally valid reason to contend that the tender submitted by him has to be considered on. merits and evaluate the same with other tenders and to award the contract after such consideration especially when the tender itself is not a valid one.
When the Original Petition was posted before J.B. Koshy, J., the learned Judge by his Reference Order dated 4-1-2000 referred the matter to a Division Bench for an authoritative pronouncement on the question at issue.
The following questions arise for determination:
(i) In this case the tenderer has submitted all the tender documents including the agreement in the stamped paper after duly signed, except K.F.C. Form No. 14 inadvertently, but with the seal of the company. In this background whether the omission to put the signature in Form No. 14 is unintentional and by pure mistake and such defect can be cured by signing Form No. 14 duly stamped with the assurance of the petitioner that all the terms and conditions of tender has been accepted as confirmed in their letter dated 29-7-1999.
(ii) Whether the non-signing in Form No. 14 alone originally submitted is only an accidental omission or a clerical error, which is only a mistake in relation to non-essential or collateral matter which ought to have been condoned by the respondent?
We have gone through the entire pleadings and perused the following documents. Ext.P1(a) - photo copy of the letter dated 29-7-1999 addressed to the respondent; Ext. PI (b) - photo copy of the Demand Draft for Rs. 3,00,000/-; Ext.PI (c) - photo copy of the offer dated 29-7-1999; Ext.P1 (d) - photo copy of the agreement dated 30-6-1998; Ext.PI (e) - photo copy of the Assessment order and enclosures; Ext.PI(f) - photo copy of the agreement dated 29-7-1999 executed by the petitioner; Ext.PI (g) - photo copy of GTS 700 series; Ext.Pl(h) -photocopy of ISO 9001 certification; Ext.PI(i)- photo copy of partial list of customers; Ext.P1 (j) - photo copy of tender document; Ext.P2 - photo copy of the letter dated 4-10-1999 addressed to the respondent; and Ext.P3 - photo copy of the letter dated 27-10-1999 sent by the respondent to the petitioner.
Under Ext.P 1 (a) dated 29-7-1999, the petitioner while acknowledging the receipt of the tender documents, submitted their tender for supply of Electronic Total Station Model GTS-701 and GTS-702 vide their offer dated 29-7-1999 and Earnest Money Deposit of Rs. 3,00,000/- was also enclosed along with other enclosures, numbering 9.
Ext.Pl(f) is the agreement executed on 29-7-1999 between the Governor of Kerala, referred to as "the Government" of the one part and Grasim Industries Ltd., referred to as "the boundeh", of the other part. This agreement is duly signed by Shri. Jayanta Chatterjee, General Manager, Grasim Industrie? Ltd., Divn. Birla International Marketing Corporation in the presence of two witnesses - Sri. Astt Srivastava and Sri.Ganesh''. D., Asst. Manager and Secretary respectively of Birla International Marketing Corporation, New Delhi - and it is attested by Notary Public.
The tender document has been filed as Ext.PI (j), which runs into 5 pages (General Conditions). K.F.C. Form No. 14 is attached to the tender document, which reads as follows:-
K.F.C. FORM 14 (See Chapter VII, Art. 143) FORM OF TENDER
Sir,
I/We hereby tender to supply, under the annexed general conditions of contract, the whole of the articles referred to and described in the attached specification and schedule, or any portion thereof as may be decided by Government, at the rates quoted against each item. The articles will be delivered within the time and at the places specified in the schedule.
I/We am/are remitting/have separately remitted the required amount, of Rs. ..... as earnest money.
Yours faithfully,
(Signature) (Address)
Date:
BIRLA INTERNATIONAL MARKETING CORPN.
A Division of Grasim Industries Ltd. 4, Vasaht Lok Community Centre, 2nd Floor, Vasant Vihar, New Delhi - 110057
*To be scored in cases where no earnest money deposit is furnished
It is seen from Ext.Pl(j) tender document that the petitioner has signed in all the pages of General Conditions, which is duly attested by a Notary Public, whereas the petitioner has, by an inadvertent omission, not signed Form No. 14, which is only a tender to supply, under the annexed general conditions of contract, the whole of the articles referred to and described in the attached specification and schedule, or any portion thereof, as may be decided by the Government, at the rates quoted against each item and that the articles will be delivered within the time and at the places specified in the schedule. In this case, the petitioner has remitted a sum of Rs. 3,00,000/- as Earnest Money as prescribed under Form No. 14 as early as on 28-7-1999. The petitioner has signed all other papers and submitted the same to the respondent, of which there is no dispute.
On 8-10-1999, the petitioner has addressed a letter (Ext.P2) to the respondent herein, which reads thus:-
BIMC/TPD/99/747.
Friday, October 8, 1999.
Director of Survey & Land Records, Directorate of Survey & Land Records, Government of Kerala, Vazhuthakadu Thiruvananthapuram.
Sub:-
Tender No. 2/1999-2000, No. Sy.H3-l 1497/99 opened on August 04, 1999 for 50 Nos. Total Stations.
Our offer No. BIMC/TPD/99/505 dated July 29, 1999 for GTS-701 (2 Sec. accuracy and GTS-702 (3 sec. accuracy) with accessories.
Dear Sir,
We would like to draw your kind attention that against your above mentioned Tender, we had submitted our offer along with the following enclosures:
Earnest Money Deposit for Rs. 3,00,000/- in the form of Demand Draft No. 797668 dated July 28, 1999 drawn in favour of Director of Survey & Land Records, payable at State Bank of India, Thiruvananthapuram.
Offer for 50 Nos. Total Stations duly signed and stamped.
Terms & Conditions including Delivery period, validity of offer, prices, sales tax rate, octori charges, payment terms, warranty terms, security deposit, operational training duly stamped and signed.
Topcon''s agency certificate copy.
Income tax/Sales tax Clearance Certificate''s copy.
Agreement as per Tender Terms on Kerala Government Stamp Paper.
Product Literature.
TOPCON ISO 9001 Certificate.
Partial List of TOPCON Customers.
Tender Documents duly stamped (all pages)
Please note the following:
Our executive had purchased tender documents after necessary payment and same has been signed in presence of your official.
Entire original tender documents was stamped on all pages and sent the same along with our offer.
K.F.C. Form 14 FORM OF TENDER was stamped with full address and logo of company as acceptance of your Tender Terms and due to over-sight it was not signed. This is not effecting the eligibility for participation in the Tender.
All terms and conditions of Tender has been accepted and confirmed vide our covering letter Nb.BIMC/TPD/99/505 dated July 29, 1999 sent along with our offer against your above referred tender.
We are enclosing once again K.F.C. Form 14 FORM OF TENDER duly stamped and signed for your reference and further action.
Since we have received no feedback after technical evaluation, we will be appreciated if you kindly inform us the current status of the case.
Thanking you and assuring you of our best services at all times,
Yours faithfully,
For Birla International Marketing Corporation.
Sd/- Jayanta Chatterjee (General Manager).
Encl: Duly signed and stamped with company''s full address and logo.
C.C. Special Secretary (Revenue), Government of Kerala. Tniruvananthapuram.
Kind attention: Mr. V.S. Sentil, for your kind information please.
Under Ext.P2, the petitioner has once again enclosed K.F.C. Form No. 14, Form of Tender, duly stamped, signed and attested for further action. A perusal of the entire tender documents would show that the petitioner has complied with all the tender conditions, but by over-sight, has omitted to sign Form No. 14, which is only a declaration/assurance to supply the materials, etc. as per the tender terms and conditions. Ext.P2 was sent by the petitioner voluntarily and before that the defect of non-signing of Form No. 14 by the petitioner was not detected or noticed. However, subsequent to the receipt of Ext.P2, the respondent informed the petitioner, by, Ext.P3, that the tender submitted by them is seen unsigned and, therefore, they are not in a position to accept the same.
In our opinion, such rejection is wholly illegal and unsustainable. The petitioner had submitted all the tender documents including Earnest Money Deposit. They had sent an agreement in stamped paper, which inter-alia provides solitary agreement that when the tender as submitted is accepted by the Government will execute an agreement incorporating all the terms and conditions under which the government accepted the tender. The tender documents were purchased from the respondent after duly signing the paper. The petitioner made an Earnest Money Deposit as required in the tender condition. The only omission was that inadvertently Form No. 14 was not signed, but stamped with the seal of the company. The omission to put the signature in Form No. 14 is unintentional and by pure inadvertent mistake. The non-signing was purely a mistake and, therefore, there is no reason to reject the tender. On the other hand, the petitioner has once again submitted Form No. 14 duly signed along with their letter dated 8-10-1999 and, thus, the defects if any having been cured, it was no more a ground to refuse consideration of the tender submitted by the petitioner along with other tenders. It is only a mistake in relation to non-essential or collateral matter, which ought to have been condoned by the respondent. It is a matter of form and not a substance and hence the omission to put the signature is not fatal and the tender documents should not have been rejected. The non-consideration of the tender submitted by the petitioner in the aforesaid facts and circumstances is only an afterthought and with a view to avoid the petitioner.
In the decision reported in M/s. Poddar Steel Corporation Vs. M/s. Ganesh Engineering Works and others, , the Supreme Court held as follows:
It is true that in submitting its tender accompanied by a cheque of the Union Bank of India and not of the State Bank cluase 6 of the tender notice was not obeyed literally, but the question is as to whether the said non-compliance deprived the Diesel Locomotive Works of the authority to accept the hid. As a matter of general proposition it cannot be held that an authority inviting tenders is bound to give effect to every term mentioned in the notice in meticulous detail, and is not entitled to waive even a technical irregularity of little or no significance. The requirements in a tender notice can be classified into two categories - those which lay down the essential conditions of eligibility and the others which are merely ancillary or subsidiary with the main object to be achieved by the condition. In the first case the authority issuing the tender may be required to enforce them rigidly. In the other cases it must be open to the authority to deviate from and not to insist upon the strict literal compliance of the condition in appropriate cases.
It is seen from the judgment that the requirements in a tender can be classified into two categories - those which lay down the essential conditions of eligibility and the others which are merely ancillary or subsidiary with the main object to be achieved by the condition. It is not the case of the department that the petitioner has not complied with the essential conditions of eligibility, etc. etc., whereas the tender is rejected on a merely ancillary or subsidiary condition. Under such circumstances, the Supreme Court held that it must be open to the authority to deviate from and not to insist upon the strict literal compliance of the conditions in appropriate cases.
Tata Cellular Vs. Union of India, - In this case, the rejection of tender was questioned in the writ petition. The High Court was directed reconsideration of the bid. With regard to the compliance statement, it was stated that the company agrees to fully comply with all paragraphs of Chap.II of the General Conditions and Chap.V, Tariffs and Document, without any deviation and reservation. In that case, there was a failure in the first instance to state about the compliance with Chapters II and IV, which is an accidental omission. In the above decision, the Supreme Court has also referred to the decision of the Privy Council in Mohammad Ejas Hussain v. Mohammad Iftikhar Hussain, AIR 1932 PC 78, wherein it was held that it is always a matter of form and not of substance. In para. 196 of the Tata Cellular case, the Supreme-Court has dealt with the case of Kutchison Max. Their tender was rejected by the TEC on the ground of non-compliance of operative and Financial Conditions laid down in Chap.III at the time of opening of Financial Bids. They Have accepted these conditions, through a letter, explaining their earlier non-compliance as typographical error.
In this case, the matter is purely technical and, therefore, the authority should not have rejected the tender. We find great force in this submission made by Mr. P.R. Raman. We are clearly of the opinion that the mistake of non-signing of Form No. 14 is in relation to a non-essential matter, that is, in relation to peripheral or collateral matter. The entire tender documents filed, signed, stamped and attested will clearly reveal that there is every intention to comply with the tender conditions. For an accidental or inadvertent omission, the petitioner cannot be punished. The non-consideration of the tender on this sole ground is therefore vitiated as non-consideration of the tender submitted by the petitioner on hyper-technical ground, amounting to arbitrary exercise of power and is also against the principles of natural justice. The tender submitted by the petitioner is entitled to be considered on its merits and awarding of any contract without considering the tender submitted by the petitioner and evaluating the same on various aspects without tender would amount to a gross violation of Art. 14 of the Constitution.
For the foregoing reasons, we allow the writ petition and issue a mandamus directing the respondent to consider the tender submitted by the petitioner on merits and evaluate the same with other tenders and to award the contract after such consideration. However, there will be no order as to costs.