AI Structured Summary
Not yet generated for this judgment
Judgment
A.S. Bopanna
The Petitioner is before this Court assailing the letter No. STS 157/2010 dated 05.02.2011 which is impugned at Annexure-P to the petition. By the said letter, the Petitioner has been informed that the Respondents cannot consider the Petitioner as qualified to award the work of fabrication of 18 Medium Water Tenders and thereby the offer has been rejected.
The brief facts are that the second Respondent floated a tender on. 21.09.2010 vide notification No. 157/2010 inviting tenderers from those who meet the requirement to respond to the same. The same was a two stage bid whereunder the technical bid was to be opened first and the financial bid of the tenderers qualifying in the technical bid was to be opened. The Petitioner which claims to be a company incorporated on 14.03.1960 under the provisions of Companies Act responded to the same on 25.10.2010 by submitting- it''s technical bid as well as financial bid. As per the other details indicated in the terms of the tender, the Petitioner is stated to have complied with the requirements. The technical bid was initially opened and therealter the financial bid of the persons who had qualified in the technical bid were also opened. The Petitioner is the lowest tenderer and therefore ''L1'' Though this was the position, by the impugned communication dated 05.02.2011 (Annexure-P) the second Respondent has communicated to the Petitioner that the Petitioner has not complied with the requirement of past performance in execution of minimum five similar contracts. Therefore, the Respondents have indicated that the Petitioner cannot be considered as qualified to award the work of fabrication of 18 Medium Water Tenders.
The Respondents have filed their objection statement seeking to justify their action, The sum and substance of their defence is that even prior to opening of the price bid, the Petitioners were required to furnish further materials to establish their past performance. In that regard, though certain documents were furnished and the technical bid as well as the financial bid was opened, it was found that the past performance did not indicate the Petitioners had in fact fabricated Medium Water Tenders for which the tender was floated. Subsequently, though a spot verification was made and report was secured, the same was not satisfactory and as such the Respondents have issued the communication dated 05.02.2011 since the Petitioner cannot be considered as qualified. Hence the Respondents claim that their action is justified and does not call for interference.
Heard Sri Sudhanshu Batra, learned senior counsel for P. Venkatsathyanarayana, learned Counsel for the Petitioner and Ms. M.C. Nagashree, learned Government Advocate for Respondents and perused the petition papers.
In the light of the rival contentions urged and. from the perusal of the papers, the undisputed fact is that the technical bid submitted by the Petitioner was analysed and thereafter the financial bid of the qualified tenderers including that of the Petitioner were opened. The statement produced at Annexure-R.1 to the objection statement would indicate that the Petitioner is the lowest tenderer, It is no doubt true in the said statement, as against the name of the Petitioner, it has been stated that they are new entrants and physical verification of the infrastructure and fabricated vehicles are to be made. This being the position, the question in the instant case would be as to whether the Respondents having opened the financial bid and having noticed that the Petitioner is the lowest tenderer, can thereafter turn around and reject the offer of the Petitioner on the ground that the Petitioner is not technically qualified when in the two cover bid system, the financial bid would be opened only on qualifying in the technical bid?
In order to consider the above aspects of the matter, it is seen thai the Petitioner submitted the technical bid dated 25.10.2010 (Annexure-F) wherein reference was made to the different types of fire fighting vehicles which have been fabricated by them and in the experience criteria, they have also indicated that that they have supplied more than 200 units of water and foam tenders in the last 30 years. The inspection certificates were also furnished and it was indicated that the fire tenders supplied by the Petitioner was to the defence, public sector and other reputed undertakings. The capabilities and the details of manufacturing facilities were also furnished. Thereafter the technical bids were opened and the Respondents addressed a letter dated 22.12.2010 (Annexure-G) to the Petitioner calling for further particulars which were to be furnished before the opening of the price bid. The said communication is relied on by both the parties in furtherance of their respective contention and as such it is necessary to extract the... same for better understanding:
Sir,
Sub: Fabrication of 18 Nos. of Medium size Water Tenders for Karnataka Fire and Emergency Services Department.
Ref: This office Tender Notification STS 157/2010 dated 21/09/2010
The bid documents, furnished by you for the fabrication of vehicles cited above have been scrutinized by the technical committee of the department after opening the same on 03.11.2010 in trie presence of the bidders.
Some of me important observations, made by the Tech veal Committee of the department are as fellows:
a One of the criteria to qualify is to furnish the details of past performance in the execution of minimum 5 similar contracts. This has not been complied fully arid a few documents, furnished, are pertaining to the vehicles of different type. This requires clarification.
b). The details of infrastructures like in-house testing, covered area to protect the chassis etc have not been furnished.
c) Drawings pertaining to load distribution, layout of pump and PTO, mounting of tank and details showing the location of Lockers have not been clearly indicated.
Subject to the production of above details She opening of price bid is scheduled on 30.12.2010 at 10.30 hrs. Before opening Inn price bid, the required documents will be verified and only the qualified bidders will be allowed to participate in the price bid opening process.
Yours faithfully.
Deputy Inspector Gencal of Police and Chairman Tender Opening and larder Scrutiny Committee Karnalaka Fire and Emergency Services
By relying on the above said letter, the Respondents contend that the technical bid was incomplete and therefore the additional details were sought. The Petitioner however contends that the said details were furnished and as indicated in the said letter, the price bid was opened only after the Respondents were satisfied with the requirement. In that regard, the communication extracted above would no doubt indicate that certain details were sought by the Respondents. Thereafter it has been indicated that the price bid is scheduled to be opened on 30.12.2010 and the required documents will be verified before opening the price bid and only the qualified bidders will be allowed to participate in the price bid opening process.
The undisputed position as noticed above, is that the price bid of the Petitioner has been opened and they are found to be the lowest tenderer. It is therefore contended on behalf of the Petitioner, fact that the price bid of the Petitioner also has been opened would indicate that the Petitioner had qualified in the technical bid and as such the Respondents cannot at this juncture contend that the Petitioner had not furnished all documents to qualify in the technical bid. On this aspect, the defence put forth by the Respondents in their objection statement at para-13 requires to be noticed. The same reads as hereunder:
It is submitted that the Petitioner has falsely submitted, that he has delivered the required documents on 29.12.2010. But in fact the documents were handed over just before the opening of price bid by one representative (Sri Nagarqj Rao). Since the documents were handed over just before the opening of the price bid and the Respondent has to complete the process in time, the Respondent has glanced the documents and allowed the representative of the firm to be present during the opening process of price bids. Later the documents were fully scrutinized and the decision was taken to disqualify the Petitioner after arranging an inspection of the works place at the Petitioners premises. There is no malafide intention to disqualify the Petitioner. It is only on the technical ground.
9, A perusal of the above aspect would indicate that as desired in the communication dated 22.12.2010, the Petitioner in fact had submitted the documents prior to the opening of the price bid which according to the Petitioners would comply with the requirement. But, the explanation put forth by the Respondents indicates that after having accepted the documents and having opened the financial bid, they have now come up with the explanation that the documents were not verified properly and had only been glanced. Such explanation on the part of the Respondents in a matter of the present: nature cannot be accepted where the Petitioner is sought to be discarded though the Petitioner is the lowest tenderer.
Notwithstanding the above, the further procedure adopted in the instant case is also to be noticed. Having accepted the technical bid and also after opening the price bid. the Respondent addressed a letter dated 07.01.201 1 (Annexure-R-2) to the Petitioner which reads as hereunder:
Sir,
SILO: Regarding the fabrication of 18 Nos. of Medium Water Tenders for Karnataka State Fire and Emergency Services Department.
Ref: 1) This office Tender Notification No. STS/157 12010 dated 21.09.2010.
2) Your Tender No. 4.302/KSF and ES/WT/42/ 10 dated 27.12.2010.
Please refer to this office tender Notification and your offer cited above. Karnataka State Fire and Emergency Services department has tentatively accepted the rates quoted by you for the fabrication of 18 Nos. of Medium Water Tenders as per the specification of the department at 12,00,000/- per Water-Tender on the. chassis to be collected from the department.
In this regard, since your firm is one of the new entrants to the Karnataka State Fire and Emergency Services department, the following officers of the department would be visiting your works place on 09.01.2011 or 10.01.2011 to assess about the Infrastructure available and your capacity to execute the work as per the specification and within the time schedule.
1) Sri B.K. Hampagol Dy.Director (Technical) Ph.No. 25544042/9342165994
2) Sri. J.H. Kavishankar Regional Fire Officer Bangalore South Ph. No. 22971529-9448321212
A few similar venules, fabricated by you and available in the nearby places may also be shown to the officers. The travel plan of the officer may please be ascertained. 1 request you to make all arrangement for their visit to your works place.
Yours faithfully, Director General of Police and Director General, Karnataka Fire and Emergency Services
A perusal of the said letter would indicate that "though the Respondents had assessed the technical and price bid and the Petitioner was found to be the lowest tenderer, the only other concern expressed was that the Respondents needed to satisfy themselves about the available infrastructure since the Petitioner was a new entrant insofar as the Respondents are concerned. As indicated, the designated officers carried out physical verification and they were satisfied with the. available infrastructure. This is evident from the averments made in paragraphs 7 and 8 of the objection, statement, which reads as hereunder :
It is further submitted thai two technical officers of the department have visited the works of the Petitioner at Gurgaon, Haryana and Mayapun industrial area. New Delhi on 11.01.2011 and. 12.01.2011. The said Officers have given report on 18.01.2011 and the same is produced herewith and marked as Annexure-R.3. In the said report the concerned officers have confirmed the availability of all infrastructures in the works place to fabricate the vehicles in and around the works placed at Haryana/New Delhi.
It is true that the Petitioner has fabricated Crash Fire tenders. Air Craft Refueller, Riot control vehicle. Mechanical Runway sweepers etc. But the Petitioner has not fabricated the tendered vehicles and is not qualified for the fabrication of 18 Medium Size Water Tenders which is one of the qualifying criteria.
Despite all the above, the only contention on which the Respondents seek to disqualify the Petitioner is that they have not complied with the condition regarding experience and past performance in the execution of minimum of five similar contracts. In that regard the fact that the Petitioners have sufficient experience in fabricating fire tenders and have supplied to Defence establishment and other public sector undertakings cannot be in dispute as the documents are produced to that effect. In fact after the physical verification, the report submitted by the Deputy Director (Technical) of the second Respondent as at Annexure-R-3 to the objection statement would indicate that the tenor of the same is for favourable consideration.
Having noticed the above, this Court will also have to keep in view the limited power of the Courts to interfere in matters relating to tender. In several decisions, more particularly in the case of M/s. Monarch Infrastructure (P) Ltd. Vs. Commissioner, Ulhasnagar Municipal Corporation and Others, ). the Hon''ble Supreme court has held that while public interest is paramount, there should be no arbitrariness or unreasonableness in the matter of award of contract and there should be fair play in action. Though the tender inviting authority is entitled to prescribe terms and conditions, there should not be arbitrariness by making changes after the tenderers have entered the field and satisfied the conditions. In the case on hand, as noticed, the Petitioner herein had qualified in the technical bid which resulted in opening of the price bid wherein they are the lowest tenderer. The physical verification carried out thereafter is also favourable, but while now rejecting the Petitioner the reason assigned is that of not performing similar contract and that too on the contention that identical contract of fabricating ''Medium Water Tender'' has not been performed. The basic technical requirement of Medium Water Tank of the Respondent is with the water tank capacity of 4500 liters and the output of 1100-1400 liters per minute at pressure of 7 kg/sq.cm. The pump high pressure output sought is of 300 liters per minute at 35 kg.cm The documents furnished by the Petitioner based on which details have been furnished in the rejoinder statement which has not been disputed would indicate that the Petitioners have fabricated fire tenders which are of higher capacity and therefore, in the instant case, it cannot be said that the Petitioners have not performed similar contracts. With regard to such vehicles fabricated, the photographs have been furnished for perusal as indicated m the report dated 18.01.2011 (Anntxure-R-3), yet it is on these reasons the impugned communication dated 05.02.2011 (Annexure-P) has been issued, which in ray view lacks bona fide.
In spite of the entire exercise undertaken as noticed above and there being nothing adverse against the Petitioner, the power of rejection has been exercised in an arbitrary manner. It is well settled that while exercising the power of judicial review in respect of contracts entered into on behalf of the State, this Court would be concerned primarily as to whether there has been any infirmity in the decision making process. The. Court can examine as to whether the decision making process is reasonable, rational, not. arbitrary or whether it is violative of Article 14 of the Constitution. The procedure adopted in the instant case up to the stage of opening the tenders; in so far as the Petitioner is concerned and the manner in which they have been subsequently dealt with would indicate flaw in the decision making process which smacks of unreasonableness and id irrational.
For all the above stated reasons, the following:
ORDER
i) The letter No. STS 157/2010 dated 05.02.2011 (Annexure-P) is quashed.
ii) The second Respondent shall now proceed to finalise the bid from the stage it was prior to issue of the letter dated 05.02.2011 which is now quashed,
iii) These petitions stand disposed in the above terms. No costs.