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Judgment
B.N. Mahapatra, J.—This Writ Petition has been filed with a prayer for quashing the Order Dated 04.10.2011 (Annexure-1) issued by Opp. Party No. 2-Executive Officer, Sambalpur Municipality by which allotment of sanitation work awarded in favour of the Petitioner in fifteen Wards of Sambalpur Municipal Sambalpur vide letter dated Council, office 27.07.2011 (Annexure-4) has been cancelled on the ground that such order is violative of the terms & conditions mentioned in the tender call notice floated under Annexure-2. Petitioner''s case in a nutshell is that on 18.06.2011, the tender call notice was published in the daily Odia Newspaper "The Sambad", which was cancelled due to unavoidable reasons. Another tender call Notice was published on 04.07.2011 (Annexure-2) inviting, quotations from the intending firms for executing the cleaning work in fifteen Wards of Sambalpur Municipal Council. The Petitioner is one of the tenderers to the Tender Call Notice dated 04.07.2011 (Annexure-2). In compliance to the tender call notice floated under Annexure-2, the Petitioner submitted all the required papers after complying with the terms & conditions as mentioned in the said tender call notice. The bids of the Petitioner along with others, who participated in the tender, were considered. After opening of the bid it was found that the Petitioner was the 2nd lowest (L-2) & another firm "DISA" became L-1 Since DISA (L-1) could not comply with the terms & conditions of the tender call notice, the Petitioner was called upon to match with the price quoted by ''DISA''. After negotiation, Petitioner had agreed to execute the work at the rate quoted by DISA(L-1) & the tender was finalized in favour of the Petitioner. After observing all the formalities the work Order Dated 27.07.2011 was issued in favour of the Petitioner. Pursuant to the work order issued under Annexure-4, the Petitioner started the sanitary work as per the work order. While the matter stood thus, letter dated 04.10.2011 (Annexure-1) was issued to the Petitioner cancelling the work order issued in his favour. Hence, the present Writ Petition.
Mr. B.K. Dash, Learned Counsel appearing on behalf of the Petitioner submits that after issuance of the work order under Annexure-4, the Petitioner keeping in view the urgency with regard to the sanitation work in respect of fifteen Wards of Sambalpur Municipal Council & as per the instruction of the Municipal Council & its Executive Officer, immediately started sanitation work on war footing & spent huge amount towards Labour charges, Sanitation equipments & other miscellaneous expenses. It is submitted that more than Rs. 17 lakhs has been spent for sanitation work in respect of 15 Wards of Sambalpur Municipal Council as per the work order. On 23.08.2011, Opp. Party No. 2 was intimated about the huge expenditure incurred by the Petitioner for the work which was already started on 15.08.2011. On account of extraneous reasons the Executive Officer of the Municipal Council did not co-operate with the Petitioner & some political persons of the locality at the behest of some of the councilors demanded money for their personal comfort for which from time to time the said fact has also been intimated to the Opp. Parties, which yielded no result. Without any reason & without giving an opportunity of being heard to the Petitioner, all of a sudden, a letter dated 04.10.2011 cancelling the work order was issued to the Petitioner, which is illegal, arbitrary & against the principles of natural justice.
Mr. B.P. Das, Learned Counsel appearing for Opp. Party Nos. 1 & 2 submits that the Opp. Parties have cancelled the work order vide office order No. 7109 dated 04.10.2011 due to exorbitant rate quoted by the Petitioner in course of negotiation & step for cancellation of work order was duly approved by the council of Sambalpur Municipality. Prior to publication of Tender Call Notice dated 04.07.2011, another agency namely, BISWA was executing the sanitation works & after completion of its contract, Sambalpur Municipality floated the tender in question on 04.07.2011 inviting sealed quotations from the intending & registered Firms/NGO''s/Organizations & contractors for executing the cleaning works in respect of 15 Wards of Sambalpur Municipality which includes road sweeping, cleaning, drain cleaning, lifting, bush cutting, spraying disinfectants, lifting of garbage to identified collection points of Municipal Council. It is submitted that pursuant to the work order, no agreement has been executed in respect of the work Order Dated 27.07.2011. Due to vehement objection of some of the Councilors of Sambalpur Municipal Council, the work order was not given effect to. On 26.08.2011, the Learned Collector & District Magistrate interfered in the matter & directed Opp. Party No. 2 to cancel the earlier tender & to go for a fresh tender fixing the ceiling price per Ward. The Collector, Sambalpur in exercise of power u/s 399 of the Orissa Municipal Act, 1950 directed the Executive Officer to undertake the work of cleaning of the Wards by hiring labours, vehicles, trolleys & purchasing necessary equipments in this regard. On the strength of the Collector''s order now the Municipality Authority is doing all sanitation works. However, due to inadequate number of staff, the Municipal Authority has admittedly failed to provide cent percent sanitation work. On the basis of the direction of the Collector, Sambalpur dated 26.08.2011, the work order issued in favour of the Petitioner was cancelled by the Executive Officer in his order No. 7109 dated 04.10.2011 (Annexure-1). Subsequently, vide Order Dated 28705 dated 20.10.2011, Government of Orissa, Housing & Urban Development Department has also cancelled the tender process due to exorbitant rate quoted by the Petitioner & direction was given to go for re-tender for privatization of sanitation works. A detailed price chart has been made in respect of each ward for cleaning, sweeping & lifting of garbage, but the same has not been given effect to due to the interim Order Dated 01.12.2011 passed in this case. Proposed rate was placed before the Council of Sambalpur Municipality for its approval before publication of tender call notice afresh. The Council in its C.R. No. 3 dated 29.10.2011 has approved the rate for each Ward & Rs. 1,60,000 has been fixed per month in respect of each Ward & also permission has been accorded for privatization of sanitation works of Sambalpur Municipality. Thus, Sambalpur Municipality has decided to go for fresh tender for privatization of sanitation works in respect of 15 Wards. It is stated that there are 29 Wards under Sambalpur Municipality & sanitation works are being done by Sambalpur Municipality with the help of its staff in respect of 14 Wards & for the rest 15 Wards, tender was floated for privatization due to inadequate staff. It is further submitted that the Petitioner has never started the work in question as per the work order. Therefore, the contentions raised by the Petitioner in the Writ Petition in this regard are not correct. Prior to cancellation of the work order, adequate opportunity of being heard was given to the Petitioner for negotiation & there is official record to this effect. Hence, there is no question of mala fide intention on the part of the Executive Officer as alleged by the Petitioner.
On the rival contentions advanced by the parties, the only question that falls for consideration by this Court is as to whether in the facts & circumstances of the case the Opp. Party-Municipality is justified in cancelling the work order issued in favour of the Petitioner after negotiation.
Undisputed facts are that out of 29 Wards of Sambalpur Municipality, the Municipality intended to carry out the cleaning work in respect of 15 Wards through private parties. Accordingly, the Municipality floated tender call notice under Annexure-2, pursuant to which the Petitioner along with another firm namely M/s. DISA participated in the said tender process. On opening of the bids, the Petitioner was found to be the second lowest (L-2) whereas DISA has become L-1. Since DISA could not fulfill the terms & conditions, the Petitioner was called upon for negotiation. In the negotiation since the Petitioner, who was the second lowest bidder, agreed to execute the work in question at the rates quoted by DISA, the work order was issued in favour of the Petitioner under Annexure. 4. In the said order, the Petitioner was informed that his rate of negotiation was accepted & he was requested to start the sanitation work within seven days from the date of receipt of the letter as per the detailed terms & conditions referred to in the tender call notice No. 4421 dated 04.07.2011 (Annexure-2). Under the circumstances, the question arises as to whether Opp. Party-Municipality is competent to cancel the tender granted in favour of the Petitioner.
It is not the case of Opp. Party-Municipality that the Petitioner has violated any terms & conditions of the tender floated under Annexure-2. The only reason given by the Opp. Parties to cancel the work order is that the Petitioner has quoted exorbitant rate. This plea for cancellation of the work order is not available to the Opp. Party particularly when the bids were invited in open tender & on negotiation, the Petitioner agreed to execute the work at the rate quoted by DISA (L-1). The other reason given in the counter affidavit is that pursuant to the order of the Collector, the Executive Officer has cancelled the work order. But perusal of cancellation Order Dated 04.10.2011 (Annexure-1) does not show that the Executive Officer has cancelled the work order on the instruction of the Collector, Sambalpur. The other illegality that would have been noticed that when the Collector had not awarded the work order in favour of the Petitioner in emergency situation as provided u/s 399 of the Orissa Municipal Act, he (the Collector) could not have cancelled the work awarded in favour of the Petitioner, who has been selected as L2 in an open tender, thereafter on negotiation, he had agreed to execute the works as per the rates quoted by DISA (L-1.). The cancellation order passed under Annexure-1 also does not show that grave prejudice has been caused to public interest for which the Collector issued direction to the Executive Officer for cancellation of the work order issued in favour of the Petitioner. For this reason, the order of cancellation under Annexure-1 is bad in law & liable to be quashed.
It is further noticed that in the Order Dated 20.10.2011 (Annexure-F/2) issued by the Housing & Urban Development Department it is stated that in exercise of power under sub-Section (1), clause (d) of Section 398 of the Orissa Municipal Act, 1950, the State Government cancelled the tender/quotation called for by Sambalpur Municipality in their letter No. 4421 dated 04.07.2011 & also the subsequent work assignment order issued vide letter No. 6232 dated 27.07.2011. But prior to passing of the order of cancellation under Annexure- F/2, the impugned order of cancellation under Annexure-1 was passed by the Executive Officer of the Municipality. Annexure-2 further reveals that for awarding sanitation work through private agency direction has been given to go for fresh tender. The said order passed under Annexure-F 12 in exercise of power under sub-Section (1) clause (d) of Section 398 of the Orissa Municipal Act, 1950 also does not indicate that how the work order awarded in favour of the Petitioner was prejudicial to the interest of the Municipality as the same has been settled/finalized in favour of the Petitioner through open tender after the Petitioner matched the rate quoted by DISA (L-1). It is also admitted by Opp. Parties in their counter that due to inadequate number of staff, the Municipal authorities have failed to provide cent percent sanitation work in Sambalpur Municipality. Further the Housing & Urban Development Department of the State Government represented by its Deputy Secretary could not have cancelled the agreement executed in favour of the Petitioner as it was already cancelled by the Executive Officer of the Municipality. Therefore, the question of cancelling the agreement for second time by the Department did not arise at all.
For the foregoing reasons, we don''t find any valid & cogent reason to cancel the work order awarded in favour of the Petitioner under Annexure-4. Therefore, cancellation of the work order under Annexure-1/Annexure- F /2 is hereby quashed by issuing a writ of certiorari.
Since the order of cancellation passed under Annexure-1 by the Executive Officer, Sambalpur Municipality (Opp. Party No. 2) & the order passed by the Deputy Secretary to the Government in Housing & Urban Development Department are not valid in (sic) for the reasons stated above, we direct Opp. Party-Sambalpur Municipal Council to forthwith proceed with the work order issued under Annexure-4 in favour of the Petitioner, as the same is valid in law. With the above observation/direction, the Writ Petition is allowed.