Kadathanad Labour Contract Co-Operative Society Limited Vs

N.Nagaresh, J

The petitioners are aggrieved by the shortsighted implementation of the online portal dealing with the registration/renewal of licences issued to the PWD Contractors, due to which the petitioners who are Labour Contract Co-operative Societies are unable to renew their licences, which in turn prevent the petitioners from participating in tender processes.

The petitioners state that they are registered Co-operative Societies undertaking civil contract works. The petitioners are licensed contractors of the Public Works Department (PWD). The registrations granted by the PWD are expiring/ have expired.

In  the  year  2021,  the  Government  of  Kerala developed a new  online portal with an intention to   consolidate creation, renewal of licences   and awarding of contracts. The site is named http://contractors.kerala.gov.in/contractor  portal. The process of renewal of licence is migrated to the online portal, for all renewals from March, 2021. The contract tendering process for PWD works were also moved to the new portal.

Logins are created on the portal based on PAN Card of user. The contractors have to create login as per their status. In the portal, though there are options to create login for “Individual”, “Firm”, “HUF”, “Association of Persons” and “Body of Individuals”, there is no option to create login as a Co-operative Society. The option “Firm” only has “Company”, “Partnership” and “Proprietorship” as sub options. There is no option for “Co-operative Society”. As there is no option for Co-operative Societies, the petitioners had to create login as an “Association of Persons”.

The petitioners state that Co-operative Societies are granted certain benefits in the matter of Government Contracts. When the petitioners tried to register for civil works in the portal, the portal reported error saying that the petitioners are not eligible. In the circumstances, the petitioners preferred complaints pointing out the flaw and need for correcting the same. The petitioners are effectively disabled from participating in government contracts. The petitioners therefore prayed that the respondents be directed to allow petitioner-Societies to participate in tender process dehors renewed licence until online portal is capable of accepting “Co-operative Society” as an applicant type.

The Kerala Public Works Department resisted the writ petitions filing a statement in W.P.(C) No.27136/2021. The PWD stated that benefits if any conferred to the Labour Contract Societies are based on Government Orders issued by the Co-operative Department. The registration of Labour Contract Co-operative Societies and its classifications are also governed by orders issued by the Co-operative Department.

On the basis of registration certificates issued by the Co-operative Department, Labour Contract Co-operative Societies (LCCS) can submit bids. The LCCS must have valid registration certificates issued by the Department of Co-operation. As per Clause 1913 of the PWD Manual, the Rules for registration of PWD Contractors will not apply for the registration of LCCS, BSS, Kerala State Construction Corporation and other workers bodies which are governed by separate Government Orders. Hence, no provision is included in PRICE Software for renewing licence of LCCS. The issue of including LCCS in PWD works and the PRICE Software is under examination.

I have heard the learned counsel for the petitioners and the learned Senior Government Pleader representing the respondents.

The grievance of the petitioners is that as the category “Co-operative Societies” is not included in the PRICE portal through which PWD contracts are tendered and through which issuance and renewal of PWD Contractors Licence are made. The petitioners who are Labour Contract Co-operative Societies are effectively precluded from renewing their licences and participating in government tenders. In the PRICE portal as it exists now, the applicant type has the options “Individual”, “Firm”, “HUF”, “Association of Persons” and “Body of Individuals”. The option “Firm” only has “Company”, “Partnership” and “Proprietorship” as sub-options. There is option for Co-operative Societies.

The Government of Kerala is giving price preference to Labour Contract Co-operative Societies in all public works. The approved Labour Contract Societies, depending upon the class of registration, participating in the tenders floated by the Government, are eligible for a price preference up to 10% over the quoted amount of the lowest bidder in the matter of deciding the successful lowest bidder. This is evident from GO(Ms) No.41/2020/PWD dated 19.03.2020.When  the  Government  is  consciously preferring Co-operative Societies in the matter of public works, the respondents will not be justified in creating hurdles for the LCCS in the matter of renewal of licence and award of tenders.

The issue is a clear instance of digital discrimination which would indeed violate Article 14 of the Constitution of India. Labour Contract Co-operative Societies which are entitled to encouragement and protection under the extant Government Orders. Co-operative Societies are recognised under Part IX-B of the Constitution of India and cannot be made to suffer due to the omission of the respondents in creating appropriate option types in the PRICE portal.

In fact, this Court has considered the issue of non-renewal of registration of LCCS in view of the faulty formulation of online portal, in W.P.(C) No.7750/2021. The writ petition was disposed of by a learned Single Judge of this Court on 26.03.2021 directing the Chief Engineer (PWD) to take emergent action in the matter.

In the facts and circumstances of the case, the writ petitions are disposed of directing the competent among the respondents to take immediate steps to add “Co-operative Society” as an applicant type in the online portal, within a period of two months. There will be a further direction to the 2nd respondent to allow the petitioner-Societies to participate in tender processes dehors renewed licence until online portal is made capable of accepting “Co-operative Society” as an applicant type.