Jatin Kalita vs Hindustan Paper Corporation Ltd. and Others

By a notice dated 14.12.2000, the Hindustan Paper Corporation Limited invited sealed tenders from experienced and financially sound parties for supply of Bamboo from Lower Assam by Rail through Rail points from and beyond Barpeta Road. In the said notice, it has been indicated that tender papers can be obtained from the office of the senior Manager (Forests). The petitioner''s case in this writ petition is that he went to the office of the Senior Manager (Forests) for obtaining tender papers, but he came to know that under clause-4 of the detailed terms of the tender some documents were required to be furnished along with the technical bid and the technical bid without the said documents would be rejected. The petitioner therefore decided not to submit his tender as he did not satisfy the requirements of technical bid and did not have the documents in support of the technical bid and in particular the requirements in sub-clauses (i) and (iii) of the said clause 4 of the detailed terms of the tender. The petitioner''s further case in the writ petition is that several other tenderers who are named in the writ petition also did not satisfy the requirements of the technical bid and did not furnish the documents in support of such technical bid as detailed in clause 4 of the detailed terms of the tender, but the authorities of the Hindustan Paper Corporation have relaxed clause-4 of the detailed terms of the tender and considered the tenders of such tenderers not satisfying the requirements of said clause-4. The petitioner has therefore prayed for appropriate writ/ direction on the respondents 1, 2 and 3 to strictly comply with the terms stipulated in the detailed terms of the tender.

Mr. B.K. Sharma, learned counsel for the petitioner, submitted that because of the aforesaid clause 4 of the detailed terms of the tender, the petitioner did not participate in the tender process by submitting his tender. If at this stage the authorities are permitted to relax the said clause 4 of the detailed terms of the tender and consider the tenders of other tenderers who did not satisfy the conditions of he said clause 4, the right of the petitioner under Article 14 of the Constitution of equal treatment in the matter of contract by the State and its Instrumentalities will be affected. In support of his submission, Mr. Sharma cited the judgment of the Supreme Court in Ramana Dayaram Shetty v. International Airport Authority of India (1979) 3 SCO 489. Mr. M. Hazarika, learned counsel appearing for respondents 1, 2 and 3, on the other hand, submitted that from the averments in the writ petition as well as the reliefs claimed therein it will appear that the petitioner is not so much interested in submitting his tender for supply of Bamboo and is more interested in enforcing the aforesaid clause 4 of the detailed terms of the tender. She further submitted that it will be clear from the averments in the affidavit-in-opposition filed on behalf of respondents 1, 2 and 3 that to the knowledge of the Hindustan Paper Corporation the petitioner has absolutely no experience in bamboo transportation. She further submitted that bamboo handling and transportation require skill and expertise and unless the petitioner has experience in such handling and transportation of bamboo, he cannot qualify in a bid for transportation of bamboo merely because he has executed supply orders for the Government and Financial Institutions. Mrs. Hazarika submitted relying on the averments in the affidavit-in-opposition filed on behalf of respondent 1, 2 and 3 that clause 4 of the detailed terms of the tender has to be interpreted in a rational way keeping in mind the public-interest and so interpreted tenderers with substantial experience in bamboo transportation will fall within the zone of consideration in respect of their tenders for supply of bamboo. She explained that it is for this reason that the authorities have taken a broader view of clause 4 of the detailed terms of the tender and negotiated with the different tenderers who had experience in the transportation and supply of bamboo and as a result a competitive rate of Rs. 1419 PMT has been determined by the authorities as the rate at which bamboos are to be supplied to the Corporation. She referred to paragraph-4 of the affidavit-in- op position field on behalf of respondents 1, 2 and 3 in which it has been stated that bamboo is a primary raw material for production of paper at Nagaon Paper Mill, and such bamboos were previously obtained in sufficient quantity from Karbi Anglong, but on account of deterioration of law and order situation in Karbi Anglong area, supply of bamboo to the aforesaid Paper Mill at Nagaon has been adversely affected. She submitted that unless the interim orders passed by this court are vacated and the authorities of Corporation are allowed to finalise the tender for supply of bamboo to the aforesaid Mill at Nagaon, the regular flow of bamboo to the Paper Mill cannot be maintained. I have also heard Mr G.N. Sahewalla, learned counsel appearing for respondent No. 4, Mr. N. Dutta, learned counsel appearing for respondents 5, 6, 7 and 8 and Mr. AK Phukan, learned counsel appearing for the respondent No. 9.

Mr. N. Dutta, learned counsel appearing for respondents 5 to 8 in particular relied on the decision of the Supreme Court in GJ Fernandez v. State of Karnataka (1990) 2 SCO 488 , in support of his submission that the authorities inviting tenders is not altogether precluded from relaxing the conditions in the tender notice and considering the tenders of those tenderers who did not strictly satisfy the conditions in the tender notice. According to Mr. Dutta, the aforesaid decision of the Supreme Court in GJ Fernandez (supra) will make it clear that the tender process would be vitiated only if discrimination and violation of Article 14 are established. Mr. A.K. Phukan, learned counsel appearing for respondent No. 9 however, relied on the decision of the Supreme Court in M/s. Monarch Infrastructure (P) Ltd. Vs. Commissioner, Ulhasnagar Municipal Corporation and Others, in which the Supreme Court upheld the orders of the High Court in directing the process of tender to be carried out afresh instead of awarding the contract to one of the existing bidders as one of the conditions of eligibility was detailed after expiry of the time limit for submission of tenders but before opening of the tenders.

Clause 4 of the detailed terms of the tender for supply of bamboo in the present case is to be following effect:

"4. DOCUMENTS TO BE ENCLOSED WITH THE TENDER :-

Technical Bid part (Part-I) of the tender shall be opened first and following documents are required to accompany the Technical Bid. Otherwise to treat the Technical Bid as incomplete and tender will be rejected.

(i) Tenderers must possess experience certificate or completion of certificate of work order of supplying minimum 5,000 MT (Five thousand metric tone) bamboo by Rail transport against a single contract to any Paper Mill in India during any of the calendar year of 1999 & 2000.

(ii) Copy of the valid ITCC issued by Income Tax Department. In the case proprietary Firms, the ITCC issued by the Authority shall be accepted subject to submission of Court Affidavit.

(iii) Copy of permission by the Railway Authority of Stations Barpeta Road and others beyond Barpeta Road allowing the parry to use that particular stations to store bamboo for despatch by Rail.

NB Technical Bid without above documents will be considered as incomplete and tenders with such Technical bids will be rejected.

(iv) Earnest Money Drafts in the manner desired for the quoted quantity."

The aforesaid clause 4 of the detailed terms of the tender provided that technical bid part (Part-I) of the tender shall be opened first and the documents indicated therein are to accompany the tender papers, otherwise, the technical bid will be treated as incomplete and the tender would be rejected. The expression "tender will be rejected" is different from the expression "tender is liable to be rejected". In the case of the expression "tender will be rejected", no scope is available to consider a tender which does not satisfy the requirements of the said technical bid. Thus, an intending tenderer is likely to get an impression that a tender not satisfying the said requirements of technical bid in clause 4 will be rejected and will not be considered at all. With this impression an intending tenderer may not submit his tender at all and if at a later stage the authorities inviting tender take a view that they can consider a tender even if it does not satisfy strictly the requirements of the said clause-4, the right of such intending tenderer under Article 14 of the Constitution will stand affected because on account of his non-submission of tender his tender cannot at all be considered by the authorities. The petitioner''s case in the writ petition in fact is that he did not submit his tender as he did not satisfy the requirements of said clause-4. It is quite possible that the petitioner may not have the required knowledge and experience in transportation and supply of bamboo. But as to whether he has such knowledge or experience for supply and transportation of bamboo to any party could only be considered after he submitted his tender. Since the petitioner was unable to submit his tender on account of the aforesaid clause 4 of the detailed terms of the tender, I am of the considered opinion that his right under Article 14 of the Constitution has been affected.

But this is not to say that the authorities cannot at all consider the tenders which have been submitted by the tenderers which do not satisfy strictly the requirements of the said clause-4 of the detailed terms of the tender. As has been held by the Supreme Court in GJ Fernandez (supra) it is not that the authorities inviting tenders cannot deviate from the conditions in the tender at all in any situation, but that any deviation, if made, should not result in arbitrariness or discrimination. The Supreme Court further observed in the said case that changes or relaxation in the conditions would be unobjectionable unless the benefit of those changes and relaxation are extended to some but denied to others. Referring to the case of Ratnana Dayaram Shetty v. Internationa) Airport Authority of India, (supra), the Supreme Court held in the said case of GJ Fernandez (supra) that the rule in Ramana case (supra) would be readily applied by courts to a case where a person complains that a departure from the qualifications has kept him out of the race, but injustice is less apparent where the attempt of the applicant before court is only to gain immunity from competition.

Applying the aforesaid principles laid down by the Apex Court to the present case, it appears that the authorities have relaxed the requirements of clause 4(1) of the detailed terms of the tender and considered the tenders of the tenderers who had not satisfied the said requirements in clause 4(1) and as a result of such consideration has obtained a competitive rate of Rs. 1419 PMT for supply of bamboo. Thus, the relaxation of clause 4(i) of the detailed terms of tender has been done by the authorities in the public interest with the view to obtain a better competitive rate. The only prejudice which however has been caused by such act of relaxation of clause 4(i) of the detailed terms of tender by the authorities is that the parties who intended to submit their tenders but could not submit tenders on account of strict requirements of clause 4 of the detailed terms of the tender, such as the writ petitioner, have been kept out of tender process. This prejudice caused to the parties, such as the petitioner, who have been kept out of the tender process can be rectified either by inviting fresh tender or by issuing a corrigendum to the notice inviting tender. Mrs. Hazarika, counsel appearing for the respondents 1, 2 and 3 has stated that the authorities have now finalised the rate of Rs. 1419 PMT for supply of bamboo and therefore no useful purpose would be served by calling for fresh tenders. She further submitted that rather calling for fresh tenders would further delay the process of finalisation of tender for supply of bamboo and in the result the flow of bamboo to the Paper Mill at Nagaon cannot be maintained. In these circumstances, it will be more appropriate if the prejudice caused to the parties who have been excluded from the tender process, such as the petitioner, is rectified by issuing a corrigendum to the notice inviting tenders stating therein that clause 4(1) of the detailed terms of the tender would be relaxed in appropriate cases by the authorities. Such a procedure for issuing corrigendum, in my considered opinion, will not lead to any arbitrariness or discrimination and violation of Article 14 of the Constitution. In Monarch Infrastructure (P.) Ltd. (supra), the Supreme Court observed that the High Court was justified in setting aside the award of contract in favour of Monarch Infrastructure (P.) Ltd on the ground that it did not fulfil the conditions relating to clause 6(a) of the tender notice which had been subsequently deleted, and held in para-14 of the judgment that public interest in that case would be served by reason of allowing the tender process to be completed by accepting the highest offer made by Monarch Infrastructure (P.) Ltd subject to raising its bid to Rs.42 crores matching with that of Ramchand Mahadeo Rao. The Supreme Court further did not allow Konarch Infrastructure (P.) Ltd or M/s. Jai Krishna Infrastructure such an opportunity as they had submitted lower bids. Thus, in the said case of Monarch Infrastructure (P) Ltd., cited by Mr. Phukan, ultimately no direction was given for fresh tender by the Supreme Court keeping in view the facts and circumstances of the case. In the said decision, the Supreme Court held in para-11 that broadly stated the courts would not interfere with the matter of administrative action or changes made therein, unless the Government''s action is arbitrary or discriminatory or the policy adopted has no nexus with the object it seeks to achieve or is mala fide. In the present case, it is difficult to hold that the action of the Corporation in making the changes by relaxation of clause 4(1) of the detailed terms of the tender was vitiated by mala fide or was contrary to public interest. Such action however has worked out some arbitrariness or discrimination in excluding the parties who intended to submit tenders but could not due to strict requirements of in clause 4(1) of the detailed terms of tender. Such arbitrariness or discrimination can be rectified by issue of a corrigendum to the tender notice in the manner indicated above so that such parties can submit their tenders and the tenders can be considered by the authorities for supply of bamboo at the rate of Rs. 1419 PMT already negotiated by the parties.

With the aforesaid observations and direction, the writ petition stands disposed of. Interim order passed by this court on 25.1.2001 directing the respondent Nos. 1. 2 and 3 not to settle the supply work with any person who does not fulfil condition No. 4 mentioned in the tender notice dated 14.12.2000 is vacated. Considering however the entire facts and circumstances of the case, I leave the parties to bear their own costs.