Mohammad Atiqullah Dar vs Union of India and Others

Mohammad Yaqoob Mir, Judge

Bids from approved and eligible contractors of CPWD and those of appropriate list of M.E.S, BSNL, Railway & State PWD (B&R) of J&K,

Punjab, H.P, Haryana and U. T Administration (Chandigarh) for the worki.e. ""repair and renovation of Tawi Hostel Mess, Guest House and C

Block at NIT, Srinagar (J&K), have been invited. The estimated cost of the work was Rs. 65,04,547. The petitioner had submitted his bid and

was found to be the single bidder. The amount tendered by the petitioner was Rs. 1,09,78,900. The Executive Engineer, Central Division, CPWD,

Srinagar recommended that the lowest tender of the petitioner may be accepted after negotiation if deemed fit. While doing so, the said Executive

Engineer has mentioned that the petitioner has casted the lowest tender which is 68.79% above the estimated cost of Rs.65,045,547/ and is

2.75% above the justified amount of Rs.1,06,84,815/ but the respondent Superintending Engineer has rejected the single tender of the petitioner in

view of high rates vide his letter dated 03.01.2012 and thereafter fresh bids have been invited for three works which include the work in question.

Dissatisfied with the action of respondents instant petition has been filed and vide order dated 20.01.2012 status quo has been directed to be

maintained till next date of hearing.

The respondents have filed their reply whereas petitioner has also filed supplementary affidavit. Keeping in view the urgency involved in the

matter petition is taken up for final disposal.

Learned counsel for the petitioner would contend that the estimated cost is based on schedule of rates prevalent in the year 2007, thereafter

schedule of rates has not been published and it is in view of that, in accordance with present prevalent market rate, justified cost is made mention

of by the Executive Engineer in his recommendation.

Learned counsel while referring to CPWD Works Manual, 2012, referred to Section 20.4.5 of the Manual which provides for acceptance of

single tender on occasions, then also referred to Section 20.4.7 which provides for negotiations to be restricted to the lowest tenderer, then also

referred to Section 20.4.3.2 which provides that variation up to 5% over the justified rates may be ignored, variation up to 10% may be allowed in

special circumstances and for peculiar situations, tenders above this limit should not be accepted.

While referring to these provisions, learned counsel would contend that the Manual would provide for accepting single tender, then would

provide for scope of negotiations and also the position of variation up to 5% over justified rates. Least the respondents should have done is that the

petitioner should have been asked for negotiations and in the process of negotiations the offer could be reduced below justified rates but the

petitioner has been deprived of that right and added that the petitioner is still ready to execute the work even on the justified rates as worked out

by the Executive Engineer.

Learned counsel would further contend that two other works, such as 0.25 dormitory for girls and 0.75 dormitory for boys at Qatrunka JNV

Bundhil district Rajouree J&K I/C Development of site Ag. No. 31 of 2011-12 and Administrative block quarter guard and store block Bn.

Camping site of CRPF Sundarbani Jammu (J&K) Ag. No. 34 of 2-11-12, were allotted after negotiations wherein justified rates were accepted

subject to rebate in percentage. By referring to above said position, it clearly emerges that in case petitioner would have been invited for

negotiation, the work might have been allotted to him after due rebate but he has been altogether deprived of the said right.

Learned counsel for the respondents Mr. Makroo, with all vehemence at his command and with all seriousness, projected that the respondents

have authority to reject the tender without assigning any reason.

The contention of the learned counsel has to be repelled, becausefairness and reasonableness are the hallmark of the exercise of discretionary

power, rejection of the tender shall not be an automaticprocess. In case petitioner would have offered rate much higher thanthe justified amount,

then definitely it could be inferred that thenegotiation would not work but the tendered amount is such which,according to Executive Engineer, is

only 2.75% above the justified amount but according to learned counsel for the respondents same is 4.75% above the justified amount which

would means a negotiablesituation because Section 20.4.3.2 of the CPWD Works Manual providesfor ignoring of variation up to 5% over the

justified amount. Thatapart, petitioner himself has volunteered to give rebate of percentagewhich is above the justified amount or even has

volunteered tonegotiate even below the justified amount. Secondly when similar othercontractors were called for negotiation and those works on

negotiationwere allotted to them, therefore, petitioner could not be deprived of such right.

Legitimate expectation is also a right which cannot be deniedunless the petitioner is given chance to negotiate. It is discerniblefrom the records

that the action of respondent (Superintending Engineer) in rejecting tender of the petitioner does not appear to besound. Simply to say tender is

rejected because of higher rates can beenough but when the records produced indicate that the percentage abovethe justified amount is negotiable,

then rejection without suchnegotiation is not permissible. Fairness should not become casualty. It is true that the respondents cannot be forced,

rather compelled, toaccept the tender of the petitioner but in the given facts andcircumstances and keeping in view the scope of legitimate

expectation,then the scope of controversy, more particularly, estimated cost andjustified cost, then the cost offered by the petitioner, right

tonegotiate cannot be ignored. Public interest has to be promoted, individual interest has to yield to the public interest. In the instant case if the

petitioner would have been called for negotiation, may be that would have promoted public interest as on negotiation he might offer to execute the

work on justified cost or less than what has been shown as justified cost and after negotiation it is for the authorities to see whether offer of the

petitioner would be compatible to the public interest and would be on lower side, then to accept it or to reject it.

Viewed thus, this petition is allowed. Order of rejection is quashed. Respondent No. 3 is directed to call the petitioner for negotiation and after

negotiation respondent No. 3 shall be free to pass such orders as shall be warranted and while doing so shall keep the public interest in view.

The process of re-tender of the work as initiated vide tender notice under challenge to the extent it pertains to the work in question i.e. repair

and renovation of Tawi Hostel Mess, Guest House and C Block at NIT, Srinagar (J&K), shall await result of such negotiation. In case on

negotiation work is allotted to the petitioner, then the fresh tender notice under challenge shall be withdrawn. In case negotiation fails, then

petitioner shall be given time to respond to the said tender notice. Disposed of as above along with connected CMP.