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Judgment
B.S. Walia, J. - Challenge in the instant Letters Patent Appeal is to the judgment dated 19.02.2016 rendered by the Hon'ble Single Judge in OWP
No. 153/2016 whereby the writ petition filed by the appellant seeking a direction to the respondents to consider its technical bid submitted through
J and K Small Scale Industries Development Corporation Limited (SICOP) on its merit in reference to Notice Inviting Tender issued by
respondent Nos. 2 and 3 was dismissed.
Brief facts of the case leading to the filing of the instant appeal are that as per averments in the Letters Patent Appeal, the appellant is a Small
Scale Industrial Unit (hereinafter referred to as SSI) registered with the Directorate of Industries and Commerce, J and K engaged in manufacture
of absorbent cotton wool, absorbent cotton gauze, rolled bandages and bandage cloth.
That respondent Nos. 2 and 3 issued Notice No. JKMSCL/Dressing Material/2015/313 dated 12.12.2015 (Annexure-B to the writ petition)
inviting e-bid on behalf of the J and K Kashmir Medical Supplies Corporation for finalisation of Annual Rate Contract for the procurement of
Dressing material from the manufacturers/direct importers/authorised distributors/dealers of the manufacturers/direct importers. The tendering
process initiated vide aforesaid NIT was under two cover system i.e. Technical Bid in Cover 1 and Financial Bid in Cover 2.
That as per the appellant, being fully eligible and qualified in terms of the Notice Inviting Tenders, it applied for participation in the tendering
process by purchasing the necessary tender form from respondent No.2. On the basis of Clause 3.7 (iv) (f) in the Tender Document (Annexure-
B), it is the stand of the appellant that a local registered SSI unit could submit its quotation or seek supply order through SICOP or
request/authorize SICOP to represent its case before the Purchasing Department and that in all such cases, SICOP would be treated at par with
the SSI Unit or Units whose case(s), it may be representing in respect of all matters connected with the finalisation of the contract, delivery of
supplies and price preference.
Clause 3.7 (iv) (f) of the NIT is reproduced hereunder :-
It would be lawful for any local registered SSI Unit to quote through SICOP or to seek supply order through SICOP or to
request/authorize SICOP to represent its case before the Purchasing Department. In all cases, SICOP shall be treated at part with the SSI
Unit or units whose case it may be representing for all matters connected with the finalisation of the contract, delivery of supplies and price
preference.
That it is also the stand of the appellant that having got itself registered with SICOP and being desirous of participating in the aforesaid tendering
process through SICOP, it routed its tender bid through SICOP. Copy of the Registration Certificate under Marketing Assistance Scheme issued
by SICOP in favour of the appellant is annexed to the writ petition as Annexure-C while the authorisation to SICOP to participate in the aforesaid
tendering process vide authorisation letter dated 04.02.2016 is attached as Annexure-D to the writ petition.
That as per the NIT, every tenderer was mandatorily required to submit bid through electronic mode i.e. on e-portal and under no condition
tender bids were acceptable in physical form. As per NIT, Annexure B, last date for downloading bid document was 05.02.2016 by 1400 HRS,
last date for uploading of bid was 05.02.2016 by 1600 HRS while the date for opening of technical bid was 06.02.2016 at 1100 HRS.
That it is the stand of the appellant that SICOP completed all formalities on its behalf for filing of its e-bid one day prior to the last date of
uploading of tender bids i.e. 04.02.2016 but despite all efforts to upload the tender bid from its account i.e. of SICOP on the web-portal i.e.
www.jktenders.gov.in the same was unsuccessful due to the digital signature provided to SICOP not working properly as a result of which, the
tender bid could not be uploaded.
That it is the stand of the appellant that when its tender bid could not be uploaded due to fault in the web-portal, SICOP took up the matter with
respondent Nos. 2 and 3 vide letter dated 04.02.2016 i.e. (Annexure-E to the writ petition) addressed to respondent No.3 forwarding along with
the said letter the following documents pertaining to tender bid of the appellant :-
(a) Earnest money
(b) Demand Draft
(c) Drug Manufacturing License
(d) ISO 9001:2008 certification
(e) Authorization Letter
(f) Annual Turnover
(g) Sales Tax/VAT clearance
(h) PAN Card
(i) Proof of permanent registration
(j) Trade Mark Registration
(k) Income Tax Certificate
(l) GMP/Non conviction certificate
(m) Annexures A to S
Receipt qua earnest money deposited as also bid document fee and processing charges issued by respondent No. 2 has been attached along with
the writ petition as Annexure-F (Collectively).
That it is also the stand of the appellant that it on its own also took up the matter with respondent Nos. 2 and 3 by way of communication
(Annexure-G to the writ petition) dated 05.02.2016 indicating therein that its tender bid submitted by SICOP could not be uploaded due to non-
working of digital signature provided to SICOP, therefore last date for submission of the tender bid be extended by 7 days in the interest of local
SSI Units as also to get better competition.
That before the writ Court, plea of the appellant was that the technical bid of all tenderers who had responded to the aforesaid NIT although
had been opened but the same had not been finalised and the appellant having been deprived of its right to participate in the tendering process on
account of fault in the web-portal where e-bids were to be submitted, ought to have been allowed by respondent Nos. 2 and 3 to upload its tender
bid and to compete in the tendering process but respondent Nos.2 and 3 had turned deaf ears towards the genuine and lawful grievance of the
appellant, an SSI Unit, as a result of which, the appellant had been ousted from the tendering process. Secondly, it was incumbent upon
respondent Nos. 2 and 3 to ensure that every tenderer was able to submit tenders without any difficulty/hardship and in the event of any tenderer
facing any sort of difficulty/hardship in uploading tender bid, sufficient mechanism was required to have been provided to accept the tenderers bids
manually also. Thirdly, that despite request, even the date of submission of tenders had also not been extended and the same had been done by
respondent Nos. 2 and 3 to ensure that only blue eyed tenderers could participate in the tendering process/to restrict the participation of only such
tenderers in the tendering process who were having close nexus with the authorities of respondent Nos. 2 and 3 sitting at the helm of affairs.
Although allegations of malafide have been levelled, yet no particular person against who allegations of malafide are raised, has been named or
impleaded as party by name. Lastly, it was contended that the action of respondent Nos. 2 and 3 was totally illegal, arbitrary and unconstitutional.
That much emphasis has been laid on the fact that the tendering process was of two types i.e. Technical Bid and Financial Bid and tenderers
who qualified the technical bids were to be allowed to participate in the financial bid and that although the technical bids had been opened on
06.02.2026, yet the result thereof had not been declared, therefore, respondent Nos. 2 and 3 could very easily and without any difficulty accept
the tender bids of the appellant and consider their technical bid before declaring the result of the technical bids so as to enable the appellant to
complete in the process of tendering and in case of its qualifying in both the bids, then the contract be allotted/awarded to it. It is further contended
that as per the Industrial Policy of the State Government, respondent Nos. 2 and 3 were bound to grant preference to a local SSI unit like the
appellant so as to boost the economy of the State in general and SSI units in particular which were facing grave and serious hardship in the State
due to various factors including less competitive market.
That on 19.02.2016, on the prayer of learned senior counsel for the appellant, learned counsel for the appellant as well as respondent Nos. 2
and 3 i.e. caveators were heard and the writ petition decided leading to its dismissal.
That the thrust of the arguments of learned senior counsel for the appellant is that when due to problem in the web-portal including the digital
signature provided to SICOP the appellant could not participate in the tendering process and that before the last date, SICOP as well as appellant
had approached respondent Nos. 2 and 3 and requested for extension of time to enable submission of tender bid of the appellant, then the same
ought to have been accepted due to genuine difficulty stated above leading to non uploading of the appellants bid or in the alternative the tender bid
ought to have been accepted in physical form on account of the appellant being a SSI unit and the Industrial Policy making it incumbent upon
respondent Nos. 2 and 3 to grant preference to a local SSI Unit so as to boost the economy of the State in general and SSI Units in particular as
also to ensure supply of better quality products at competitive rates and to have a healthy competition in respect of the tendering process.
That on the other hand, learned counsel for respondent Nos. 2 and 3 caveators has argued that as per Bidder Information Report dated
06.02.2016 it is clear that 24 valid bidders had participated in the tendering process and that there were only four invalid bidders including the
appellant. Learned counsel further submitted that the tenders had been invited online as per criteria which was uniformly applicable to all the
bidders and that it was the duty of the participants to ensure fulfilment of conditions stipulated in the NIT, that there was no fault in the web portal
as was evident from the submission of 24 valid bids and merely because of fault if any in digital signature of SICOM, which in no way was
attributable to respondent Nos.2 and 3, terms and conditions stipulated by respondent Nos. 2 and 3 in the NIT could not be faulted and the entire
bidding process could not be jeopardized. It was also contended that no doubt, the appellant was a SSI unit but there was many other SSI units
which had participated by submitting online bids, therefore, the appellant had no right in the eyes of law to insist either for extension of time for
uploading of bid documents or for acceptance of the bid documents in physical form, that there were sufficient number of bidders i.e. 24 who had
been found to be valid bidders so as to ensure healthy competition, that the plea of the appellant, if accepted, would tantamount to there being no
legal finality to the terms and conditions of NIT, lastly that as evident from communication dated 04.02.2016, SICOP had merely forwarded the
bid documents of the appellant on 05.02.2016 and the same made no mention of any fault in the web portal or difficulty in digital signature of
SICOP. On the aforementioned basis, it has been contended that the appeal is devoid of merit, consequentially, the same be dismissed so as to
enable finalisation of the tendering process and allotment/award of contract.
We have perused the record and given our thoughtful consideration to the submissions made by learned counsel for the parties. Terms and
conditions stipulated in the NIT categorically stipulate invitation of e-bids with last date of downloading of bid documents being 1400 HRS on
05.02.2016, last date of uploading of bid being 1600 HRS on 05.02.2016 while date for opening of the technical bids was mentioned as 1100
HRS on 06.02.2016. Bid was to be submitted through e-portal only after Pre-Bid meeting. Clause 7 of the NIT is very clear that the Bid is to be
submitted only through e-procurement portal of J and K Government i.e. www.jktenders.gov.in and that in no condition would bids be accepted in
physical form.
Apparently, the appellant did not have its own digital signature. Had the appellant been possessing its own digital signature it could have
uploaded its bid through its own digital signature and sought benefits as admissible to SSI unit by citing inability of uploading of its bid by SICOP.
The appellant having authorised SICOP to participate in the tender process on its behalf is apparent from authorisation letter (Annexure-D) dated
04.02.2016 as also communication addressed by the General Manager, SICOP to respondent No.2 dated 04.02.2016 forwarding documents
vide Annexure-E attached along with the writ petition as also receipt qua bid document fee and processing charges besides receipt qua earnest
money deposited in respect thereto i.e. Annexure-F dated 05.02.2016. It needs mention here that no time is recorded on the aforesaid receipts
nor on the communication dated 04.02.2016 i.e. Annexure-E. The said communication also does not mention attempt having been made to upload
the bids through e-procurement portal and of the same being unsuccessful due to technical snag etc. It is only by way of letter No.
SICOP/MM/2015-2016/6427 dated 06.02.2016 that a communication was addressed by the General Manager, SICOP to the appellant of
inability to participate in the tender online due to problem in the web-portal website of the State Department whereas a perusal of Annexure-G i.e.
communication from the appellant to respondent No.2 reveals that non-participation of the appellant in the tendering process was stated to be due
to non-working of digital signature of SICOP, therefore, the last date of submission of bid be extended by 7 days in the interest of local SSI units
as also to get better competitive rate. However, in the appeal, the reason for being ousted from the tendering process has progressed to problem in
the web-portal as also in the digital signature provided to SICOP. Thus there are three versions qua inability of the appellant to participate in the
tendering process all attributable to the appellant/its agent SICOP.
No doubt having a larger number of participants in the tendering process would ensure better competitive rates but at the same time sanctity
has to be accorded to the terms and conditions stipulated in the NIT. A business entity participating in the tendering process has to participate as
per the terms and conditions stipulated in the NIT and cannot insist for redrawing up of the terms and conditions for participating in the tendering
process. Besides this, as has been noted above there is a contradiction in the stand of SICOP and appellant in their written communications as also
of a third stand emerging in the appeal. As per intimation dated 06.02.2016 addressed by SICOP to the appellant online participation in the
tendering process was unsuccessful due to problem in the web-portal website of respondent No.2 whereas as per the communication of the
appellant dated 05.02.2016 to respondent No. 2, there was inability to upload the bid on account of some problem due to non-working of the
digital signature of SICOP. However, in appeal the stand on behalf of the appellant is of inability to participate in the tendering process due to
problem in the web-portal including the digital signature provided to SICOP. Thus at every turn, the stand of the appellant is different and not
worthy of acceptance. The stand of SICOP does not commend acceptance for the simple reason that the bidder information report dated
06.02.2016 of e-procurement system of J and K Government reveals that bids were received starting from 2:16 pm on 04.02.2016 in the case of
M/s Farhat Traders up till 3:55 pm from Om Surgical Industry on 05.02.2016 as against the last time of uploading of bid being 1600 HRS on
05.02.2016. Thus, in other words, upto five minutes before the closure of time for uploading of bids, bids had been received from other
participants in the tendering process, therefore, defect, if any, was in the digital signature of SICOP which was obtained by SICOP at its own level
otherwise than from respondent No. 2 and 3 and for which no fault can be attributed to respondent Nos.2 and 3 or for that matter to the e-
procurement system of Government of Jammu and Kashmir.
The Single Judge has taken note of the fact that NIT was issued on 12.12.2015 and bids were to be uploaded by the eligible bidders by 1600
HRS on 05.02.2016 after holding pre-bid meeting on 23.12.2015 at 1100 HRS. In other words, the appellant was having close to 1½ months
time for submission of its bid through e-portal. Thus even if the appellant did not have its own digital signature it could have obtained the same
within the aforesaid period of time. However, the appellant chose not to ensure availability of digital signature, instead routed its bid through
SICOP allegedly on 04.02.2016 and, that too, against receipt dated 05.02.2016 in physical form. There is no mention in communication dated
05.02.2016 from SICOP to respondent No.2 of there being any technical snag in uploading bid documents. The Single Judge has also taken note
of the fact that on 04.02.2016, 11 eligible bidders and on 05.02.2016, 12 eligible bidders respectively, uploaded their bids through e-portal well
before the cut off time fixed in respect thereto and that in the circumstances, stand with regard to digital signature provided to SICOP not working
properly, was not acceptable and that if the appellant was unable to upload the bid on 04.02.2016, the same could have been uploaded before
1600 HRS on 05.02.2016 by sorting out the issue with the web portal administrator but there was no averment to the effect that attempts were
made to sort out the technical snag with the web portal administrator on 04.02.2016 or for that matter on 05.02.2016. Besides the Single Judge
has also taken note of the fact that when the appellants bid could not be uploaded on 04.02.2016, SICOP had allegedly brought the matter to the
notice of respondent No.3 on the very same day and submitted the bid documents in physical form but that communication dated 04.02.2016
nowhere disclosed that the bid of the appellant could not be uploaded because of problem in digital signature while uploading the same, therefore,
the tender documents were being submitted in physical form and secondly, that the receipt issued by the officials of respondent No.3 on the
Communication from SICOP was dated 05.02.2016 and on the basis of the same, the Single Judge concluded that the aforementioned stand had
been made just to make out a case and further that once the technical bid of all other tenderers through e-portal had been opened, then the plea of
the appellant to participate in the tendering process by extending the time for submission of bid on line or for receiving the bid in physical form
could not be accepted.
Technical bids of 24 tenderers i.e. sufficient number of bidders in response to the NIT have already been opened though not finalized.
Therefore, at this stage, to permit the appellant to submit its bids would tantamount to rewriting the terms and conditions stipulated in the NIT and
if so allowed, there would be no finality to the tendering process and in such eventuality, it would always be open to any other person to file a writ
petition taking up a different plea for extension of time to enable him or it to submit bid by citing a ground on which he had been unable to
participate in the tendering process. If the plea of the appellant is to be accepted then the only course open would be to order fresh tendering so
that others who also could not submit their bids online within the stipulated period of time also get opportunity to participate on fresh NIT. The
same would result in unnecessary delay and taking into account that supplies in respect of which NIT was issued brooks of no delay we are of the
view that the action of respondent Nos. 2 and 3 not to entertain the bid of the appellant is in accordance with law. Thus the contention that the
action of respondent Nos. 2 and 3 was arbitrary, illegal and unconstitutional is also devoid of merit.
We have also considered the plea of malafide that despite request, even the date of submission of tenders had also not been extended and the
same had been done by respondent Nos. 2 and 3 to ensure that only blue eyed tenderers could participate in the tendering process/to restrict the
participation of only such tenderers in the tendering process who were having close nexus with the authorities of respondent Nos. 2 and 3 sitting at
the helm of affairs. Although allegations of malafide have been levelled, yet no particular person against whom allegations of malafide are raised,
has been named or impleaded as party by name. No specific allegation or person responsible for malafide exercise of power has been impleaded
as party respondent by name. The plea is devoid of merit and is therefore rejected. Reference in this connection is made to the decision of the
Hon'ble Supreme Court in THDC India Ltd. v. Voith Hydro GmbH Co., (2011) 4 SCC 756. Relevant extract of the same is reproduced
hereunder :
Shri Desai, learned Senior Counsel appearing on behalf of Voith GMBH (Respondent 1), invited our attention to the allegations of bias,
discrimination, etc. It cannot be forgotten that at a point of time, the Executive Director felt that in fact THDC (the appellant) was showing a
tilt in favour of Voith GMBH (Respondent 1). When the documents and the correspondences are examined, we do not find any tilt in favour
of either party and in our opinion, there is no scope to accept the allegation that THDC wanted to favour Alstom (Respondent 2) and had,
therefore, changed the rules of the game. That contention is clearly without any merits. The allegations of mala fides and bias are directed
towards THDC as a whole without naming any individual person. Such allegations are easy to be made but very difficult to justify. Precisely
that has happened here also. The extremely general nature of allegations would desist us from accepting the same. Particularly, when there is
hardly any material justifying the same.
Having given our thoughtful consideration to the matter, we are of the view for the reasons recorded above, that although the State
Government in terms of the Industrial Policy was required to take steps to promote SSI Units but the same does not imply promotion of an SSI
unit, in this case, the appellant, in violation of the terms and conditions stipulated in the NIT. The action of respondent Nos. 2 and 3 being in
accordance with the terms and conditions stipulated in the NIT is immune from challenge on grounds of being arbitrary, illegal or unconstitutional. It
is settled law that ordinarily, Courts will not interfere with an administrative action, 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. Reference in this connection is made to the decision in Monarch
Infrastructure (P) Ltd. v. Ulhasnagar Municipal Corpn., (2000) 5 SCC 287 wherein the Hon'ble Supreme Court was pleased to hold as under :
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.
12....The only question therefore remaining is whether any contract should have been awarded in favour of Konark Infrastructure (P) Ltd.
The High Court had taken the view that if a term of the tender having been deleted after the players entered into the arena it is like changing
the rules of the game after it had begun and, therefore, if the Government or the Municipal Corporation was free to alter the conditions, fresh
process of tender was the only alternative permissible. Therefore, we find that the course adopted by the High Court in the circumstances is
justified because by reason of deletion of a particular condition a wider net will be permissible and a larger participation or more attractive
bids could be offered.
In the circumstances, we find that the judgment delivered by the Hon'ble Single Judge dismissing the writ petition does not warrant any
interference. Accordingly, the appeal being bereft of merit is dismissed. No costs.