M/s. Gopal Dal Mills vs State of Haryana and Another

Sanjay Kishan Kaul, C.J.—Notice of motion.

Mr. Gagandeep Singh Wasu, Advocate, accepts notice for respondents No. 1 and 2.

The petitioner is a proprietorship firm dealing with the business of foodgrains. A scheme for auction/procurement of pulses is envisaged by respondent No. 2/CONFED in terms of tender notice dated 22.5.2014 (Annexure P/1). It is the case of the petitioner that the terms and conditions specified in Clause-9(f) are so oppressive that they amount to an unfair trade practice and per se are arbitrary and illegal in character. The relevant clause is as under:-

f) If reference sample sent by successful bidder fails, his entire security money (including earnest money) shall be forfeited. The forfeited amount will be transferred to Confed Account by the exchange through RTGS after deducting its applicable transaction cost. In case Confed decides to allot tender to L-2, it would be so done at the risk and cost of L-1. If forfeited security of L-1 does not take care of difference in the rate of L-1 and L-2, L-1 would be liable to compensate Confed for additional liability. L-1 will also be debarred from participation in all future auctions conducted by Confed.

Learned counsel for the petitioner contends that there are three consequences on failure of sample test of foodgrain: (i) forfeiture of the earnest amount; (ii) right to recover the differential between the bid of the L-1 and L-2 in case respondent No. 2 allots the tender to L-2; and (iii) a debarment for participation in future auctions for all times to come.

Learned counsel appearing for respondents No. 1 and 2 on the first date itself states that the petitioner had in fact submitted a tender earlier where the sample failed and even the re-sample failed and is now seeking to pre-empt the present tender somehow, even though the objective of the respondent No. 2 is only to ensure that quality foodgrains are supplied. He further submits that this fact has not been disclosed by learned counsel for the petitioner in the present petition.

Learned counsel for the respondents, however, concedes that keeping in mind the rigours of the failure of the test, it would be appropriate to provide for a re-testing mechanism and he has instructions to state that such re-testing would be permitted. Not only that, in future tenders, the provision for re-testing would be incorporated in the tender conditions itself and due care will be taken to modify the relevant clause(s) accordingly.

On the third aspect also, learned counsel for the respondents concedes that such a blacklisting for all times to come cannot be sustained in view of the judgment of Hon''ble Supreme Court in Kulja Industries Limited Vs. Chief Gen. Manager W.T. Proj. BSNL and Others, as also the various orders following the same by this Court in CWP No. 8554 of 2014 titled as Harikesh Pattar vs. State of Haryana and others, decided on 06.05.2014, CWP No. 10160 of 2014, titled: Satwant Singh and others vs. State of Haryana and others, decided on 23.05.2014, CWP No. 4815 of 2014, titled: Sh. Parteek Jain vs. The Director, Food Civil Supplies & Consumer Affairs Department, Punjab and others, decided on 14.3.2014 and CWP No. 5114 of 2014, titled as Subhash Kumar vs. Union of India and others, decided on 19.3.2014. He, thus, submits that in the event of even the re-testing failing, the party will be put to prior notice about any proposed blacklisting and after considering the response and giving adequate opportunity, a reasoned order would be passed qua blacklisting and that too for a limited period. For future tenders, the clause will be modified accordingly.

In view of the aforesaid two concessions made by learned counsel for respondents No. 1 and 2, learned counsel for the petitioner cannot advance any further grievance in this behalf.

The result is that the aforesaid concessions are taken on record and the petition is accordingly disposed of.