Sree Datta Sai Cement Concrete Products vs The State of Karnataka and Others

Ram Mohan Reddy, J.—These intra Court appeals are by the unsuccessful writ petitioner calling in question the order dated 23.02.2015 of the learned single Judge.

Facts briefly stated are :- respondent Nos. 2 and 3 being the Bangalore Electricity Supply Company Limited (''BESCOM'' for short) issued three short term tender notifications for supply of RCC, PCC and PSC poles to Tumkur Circle for a period of two years through e-procurement portal. The appellant claiming to be a manufacturer of poles in the State of Andhra Pradesh and a supplier to the 2nd respondent as an approved vendor, aspiring to secure a contract for supply of poles, when sought to submit his bid was prevented in the light of the tender qualification, which read thus:

"The bidder shall have pole manufacturing unit located within BESCOM jurisdiction".

Aggrieved by the said term in the tender, appellant preferred W.P. Nos. 1254-1256/2015 to quash the tender notifications and to declare as null and void the said term in the notification as violative of Article 14 of the Constitution of India.

Before the learned single Judge, appellant advanced a submission that the aforesaid qualification in the tender notifications was violative of law, and arbitrary. The petitions were opposed by filing statement of objections of respondents 2 and 3, inter-alia denying the allegations of violation of law or occasioning arbitrariness in the matter of inviting bids from manufacturing units located within BESCOM jurisdiction. The learned single Judge having regard to the observations of the Apex Court in the authoritative pronouncements extracted in the order, framed the following question for consideration.

"16. The only question falling for my consideration is whether the impugned qualifying requirement is violative of law and/or arbitrary?"

The learned single Judge did not fall in favour with the submissions of the learned counsel for appellant and observed that it was trite law that laying the terms and conditions of a tender falls within the domain of the executive or experts and Courts would not substitute their wisdom for the wisdom of the experts in the field. In the matter of eligibility criteria, it was observed that the prescription was with a view to generate employment for local people, encourage local industries, get more VAT, bring about development in rural areas, reduce the cost of transportation, hence did not find fault with imposition of the qualification in the terms of tender. Learned single Judge further observed that in the neighboring States too, prescription of more or less similar requirement was made. Learned single Judge having made reference to the reported opinions of the Apex Court in Michigan Rubber (India) Ltd. Vs. The State of Karnataka and Others, AIR 2012 SC 2915 : (2012) 4 BC 177 : (2012) 7 JT 446 : (2013) 1 RCR(Civil) 202 : (2012) 7 SCALE 414 : (2012) 8 SCC 216 : (2012) AIRSCW 4727 , more appropriately at paragraph 23, that there was no need for interference in the matter of settlement of terms and conditions of tender on the ground that they are fairer, wiser or more logical, or scientific; and Arun Kumar Agrawal Vs. Union of India (UOI) and Others, (2013) 9 AD 57 : AIR 2013 SC 3127 : (2013) 7 JT 218 : (2013) 7 SCALE 333 : (2013) 7 SCC 1 : (2013) AIRSCW 2814 : (2013) AIRSCW 4804 : (2013) 6 Supreme 14 , that matters relating to economic issues always have an element of trial and error and so long trial and error is bona fide and with best intention, such decision cannot be questioned as arbitrary, capricious or illegal; Indian Drugs and Pharm and Others Vs. Punjab Drugs Manufactures Association and Others, AIR 1999 SC 1626 : (1999) 3 CTC 458 : (1999) 2 JT 445 : (1999) 123 PLR 38 : (1999) 2 SCALE 306 : (1999) 6 SCC 247 : (1999) 2 UJ 889 : (1999) AIRSCW 1236 : (1999) 3 Supreme 266 , over the observation that preference shown to public sector undertakings in public interest cannot be challenged on the ground that it would apparently affect the sale prospects of a company or it is violative of Article 14 of the Constitution, declined to apply the observations of the Apex Court in Ramana Dayaram Shetty Vs. International Airport Authority of India and Others, AIR 1979 SC 1628 : (1979) 2 LLJ 217 : (1979) 3 SCC 489 : (1979) 3 SCR 1014 , as well as the opinion in B.K. Bhaskar and Others Vs. The Commissioner, Bangalore Development Authority and Another, AIR 2009 Kar 2682 : (2009) ILR (Kar) 1483 : (2009) 5 KarLJ 337 , on the premise that the admitted factual matrix in the case on hand was totally different.

The learned single Judge, at paragraph 22 of the order observed that, there were no allegations of mala fides in the memorandum of writ petition and that the impugned term in the tenders though subsequent to the issue of the tenders but much before the last date for submitting the bids was not with a view to prevent the petitioner from participating in the impugned tender process.

Reference was made to the observations of the Apex Court in Pathan Mohammed Suleman Rehmatkhan Vs. State of Gujarat and Others, (2014) 1 JT 303 : (2013) 14 SCALE 385 : (2014) 4 SCC 156 : (2014) 3 SCJ 181 , opining that it was for the State and the authorities to take economic and management decisions depending upon the exigencies of the situation guided by appropriate financial policy notified in public interest and any effort to test the decision of the State by a microscopic and suspicious eye will affect the administration causing it to stand still and decision makers losing all initiative and enthusiasm.

In the High of the aforesaid reasoning, the learned single Judge negatived the challenge to the qualification requirement in question. While dismissing the petitions, opportunity was extended to the Appellant to make proper representation to respondents 1 to 3 on the terms and conditions for tender to be issued in future which the concerned authorities, were required to take material factors into consideration and decide what should be the terms and conditions for future tender notifications. Yet again, it was observed that there were as many as 15 tenderers who submitted their bids, while some of them had made applications for impleading and no opportunity was afforded to all the bidders, a reason to reject the petitions.

Although Sri G.S. Venkatasubba Rao, learned counsel for appellant reiterates the very submissions advanced before the learned single Judge and make reference to the reported opinions supra, in the facts and circumstances, we do not find any illegality in the order of the learned single Judge calling for interference in these appeals.

In the result, these appeals devoid of merit, are rejected. I.A. Nos. 1 and 2 of 2015 are rejected as having become unnecessary.