Full Text
HIGH COURT OF DELHI
Date of Decision: 04th JULY, 2023 IN THE MATTER OF:
LOADSTAR EQUIPMENT LTD ..... Petitioner
Through: Mr. Ankit Jain, Mr. Mukesh Kumar, Ms. Meenakshi Sood and Mr. Aditya, Advocates
Through: Mr. Chetan Sharma, ASG with Mr.R.K. Joshi, Mr. Amit Gupta, Mr. R.V. Prabhat, Mr. Vinay Yadav, Mr. Saurabh Tripathi, Mr. Ojusya Joshi and Mr. Aakarsh Srivastava, Advocates for R-1
Mr. Divjyot Singh and Ms. Priaynshi Aggarwal, Advocates for R-2.
HON'BLE MR. JUSTICE SUBRAMONIUM PRASAD
JUDGMENT
1. The Petitioner company has filed the instant Writ Petition, for issuance of appropriate writ or directions to quash the communication dated 18.04.2023 issued by the Respondent No. 1 (Container Corporation India Ltd./CONCOR), declaring the Petitioner as technically disqualified from participating in the tender bearing reference no. CON/AREA1/TECH/FORKLIFT-20/2023, which was floated by Respondent No. 1 on their website vide NIT dated 08.02.2023.
2. The facts leading up to the present petition are that Respondent No.1 vide NIT bearing reference no. CON/AREA-1/TECH/FORKLIFT-20/2023, invited applications on the government portal, for bids from Original Equipment Manufacturers (OEMs)/authorized dealers, through a two packet online open tendering system, at an estimated total cost of Rs. 38,11,40,000/-, for the design, manufacture, supply, and commissioning of 20 forklifts of capacity 35 tons at specified terminals of Respondent NO. 1/CONCOR.
3. Respondent No.1/CONCOR subsequently issued a corrigendum in respect of the part of the NIT document which lays down qualification criterion for bidders. Accordingly, Clause 2.1(b) under Section II “General Instructions to Bidders” was added to the NIT document. The relevant portion of the NIT document prescribing qualification criterion is as follows: “2.0 Qualification Criteria The bidder shall provide satisfactory evidence acceptable to the Purchaser to show that- 2.[1] The bidder is a manufacturer or an authorized dealer of a manufacturer (as per Annexure 15) having experience of: a) Having successfully supplied I executed at least one single purchase order of Government departments/CPSEs/SPSEs/Public listed companies/ICD/DCT /MMLP /Ports/CFS/ CTOs for similar item during previous three financial years and current financial year last day of month previous to the one in which tender is invited. The said item should have been supplied and commissioned successfully during the period mentioned above. Work experience certificate issued by private individual shall not be considered. Work experience certificate as per format attached at Annexure-14 should be submitted. The work experience certificate should have been issued within 90 days prior to tender opening date. If an authorized dealer submits bid on behalf of the manufacturer, the same dealer shall not submit a bid on behalf of another manufacturer in the same tender for the same item/product. Either Manufacturer OR their authorised dealer can quote. But both cannot bid simultaneously for the same item/product in the same tender. b) The Tenderer must have received total contractual payments/ turnover/revenue (income) from operations of Rs.57.17 Crore in the previous three financial years (i.e., FY2019-20, FY2020-21 ft 2021-22) and the current Financial Year last day of month previous to the one in which tender is invited. The tenderers shall submit Certificates to this effect which may be an attested Certificate from the concerned department I client or Audited Balance Sheet duly certified by the Chartered Accountant/Certificate from Chartered Accountant duly supported by Audited Balance Sheet. For current Financial Year certificate with regard to received total contractual payment/turnover/revenue (income) from operation should be duly certified by the Chartered Accountant. Note: Client certificate from other than Govt Organization should be duly supported by Form 16A/26AS generated through TRACES of Income Tax Department of India.”
4. As per the NIT conditions, bids of participants were to be opened in two stages on 03.03.2023. The technical bids of the bidders was to be opened in the first stage, and the financial bids was to be opened only in the second stage, subject to evaluation of 1st stage technical bids. The Petitioner and Respondent No. 2, the only participating bidders, submitted their technical bids. Bids of both companies were opened by Respondent No.1 for evaluation in the technical stage.
5. Upon examination of the bid documents in the technical stage, Respondent No.1 issued communications to the bidding parties on 23.03.2023 and again on 24.03.2023, calling upon them to submit additional documents to rectify discrepancies found in the documents, latest by 29.03.2023. The said communications issued by Respondent No.1 have been reproduced as under: “With reference to the above E-open tender for Design, Manufacture, Supply and Commissioning of 20 Nos. of Forklift capacity 35 Ton at specified terminals of CONCOR, there are some discrepancies found in documents you have submitted as mentioned below:
1. The name of the company in Udyam Registration Certificate, PAN, GSTIN etc is showing as M/s Loadstar Equipment Limited whereas the name mentioned in other documents like Auditor's Report, work completion certificate etc is MIs Loadstar Equipment Private Limited. This needs to be clarified and relevant documents (Certificate of incorporation, change of name of company, Memorandum of association, Article of association) in support of this name change should be submitted.
2. Work experience certificate issued by M/s Arcelor Mittal Nippon Steel India Limited is given on email. Work experience certificate as per the Annexure-14 of tender document should be submitted. Whether MIs Arcelor Mittal Nippon Steel India Limited is Govt departments/ CPSEs/SPSEs/Public listed companies / ICD / DCT/MMLP/Ports/CFS/ CTOs? Document in support of this shall be submitted.
3. As per clause 2.[1] of Section-II, "Client certificate from other than Govt Organization should be duly supported by Form 16A/26AS generated through TRACES of Income Tax Department of India". Hence, form 164/26AS generated through TRACES of Income Tax Department of India shall be submitted in support of the above-mentioned point.
4. As per clause 2.[4] of Section-II, "The supplier shall be required to provide a certificate from the statutory auditor or cost auditor of the company (in the case of companies) or from a practicing cost accountant or practicing chartered accountant (in respect of suppliers other than companies) giving the percentage of local content" in this regard you have submitted a certificate issued by Chartered Engineer rather than from the statutory auditor or cost auditor of the company.
5. You have submitted NIL Deviation certificate as per Annexure-4. But there is a Deviation of 'Controller' make (Refer
┌──────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────┐ │ Name of the Firm │ │ SL. Order Order Description Date of Remarks │ │ No. placed by No. and & quantity completion of indicating │ │ (full date of delivery reasons for │ │ address, e- FORKLIFT late │ │ mail, deliveries, │ │ telephone if any │ │ no. Fax No. │ │ Contact │ │ Person of │ │ Purchaser) │ │ As per Actual │ │ contract │ │ (Signature and seal of bidder) │ │ Note: The details of supply orders for the period of at │ │ least 3 years (36 months) prior to opening of the │ │ tender, should be furnished in above format." │ └──────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────┘
2.[1] shows that the qualification criteria stipulates that a manufacturer or an authorized dealer of a manufacturer must have the experience of successfully supplying/executing at least one purchase order of government departments/CPSCs/SPSCs/ Public Limited Companies etc. for a similar item during the previous three years and the last day of the current financial year previous to the one in which the tender is invited. It also stipulates that the bidder and the authorized dealer both cannot simultaneously bid for the same item or product in the same tender.
14. Admittedly, M/s Excellent Engineering & Allied Service Private Limited has withdrawn from the tender even before the last date of submission of the tender. The question that arises for consideration is as to whether the certificate issued by APL Apollo Steel Pipes to M/s Excellent Engineering & Allied Service Private Limited for having supplied the forklift can be considered in favour of the Petitioner who is the manufacturer and whether the rejection of the said certificate issued by APL Apollo Steel Pipes should be discarded only because it has been issued in favour of M/s Excellent Engineering & Allied Service Private Limited.
15. Clause 2.[1] stipulates that in order to be considered for the tender, the manufacturer or an authorized dealer has to prove of having successfully supplied or executed one purchase order. The certificate issued by APL Apollo Steel Pipes shows that M/s Excellent Engineering & Allied Service Private Limited has supplied the machine manufactured by the Petitioner.
16. The reason given by Respondent No.1 that just because the certificate issued by APL Apollo Steel Pipes was in favour of M/s Excellent Engineering & Allied Service Private Limited. This reason cannot be accepted because that certificate shows that the machine manufactured by the Petitioner has been executed by M/s Excellent Engineering & Allied Service Private Limited with Apollo Steel Pipes.
17. No doubt, it is well settled that judicial review in administrative actions that too in matters of tender is extremely limited. However, judicial review can be exercised to prevent arbitrariness, irrationality and unreasonableness.
18. It is now well settled and has been held by the Apex Court in times without number that basic requirement of Article 14 of the Constitution of India in action by the State and non-arbitrariness in essence and substance is the heartbeat of fair play and State actions are amenable to the judicial review to the extent that the State must act validly for a discernible reason and not whimsically. If the State or instrumentality of State does not act reasonably or fairly in awarding contracts, then the Court has to step in exercising its powers under Article 226 of the Constitution of India. The Apex Court in Vice Chairman & Managing Director, City and Industrial Development Corporation of Maharashtra Ltd. and Another v. Shishir Realty Private Limited and Others, 2021 SCC OnLine SC 1141 has observed as under:-
furtherance of the same. Such a practice is counterproductive to the economy and the business environment in general." (emphasis supplied)
19. It is well settled and has been stated by the Apex Court that arbitrariness is the antithesis of Article 14 of the Constitution of India and the State has to act in a fair and reasonable manner. As stated above, in order to meet the qualification criteria all that had to be shown by the bidder who is a manufacturer is that it is having the experience of supplying at least one single purchase order of government departments, CPSEs, SPSEs, Public listed companies, ICD, DCT, MMLP, Ports, CFS, CTOs for similar item during previous three financial years and current financial year last day of month previous to the one in which tender is invited.
20. The reason given by Respondent No.1 that since the certificate has been issued by APL Apollo Steel Pipes only in favour of supplier, and, therefore, it cannot inure in favour of the manufacturer, cannot be accepted.
21. At this juncture, it is apposite to reproduce Clause 5.[4] along with Annexure-10 & 11 of the NIT. “5.[4] For purpose of Para 2.[1] (a), the bidder should additionally submit- (a) Performance Statement as in Annexure-10, giving a list of major supplies (Forklift of Capacity 32-35 Ton), effected in the last 3 years from the date of tender opening, giving the details of Purchaser's name and address, e-mail, telephone No., Fax No., Contact Person, order No. and date and the quantity supplied and whether the supply was made within the delivery schedule as asked in Annexure-10 and information of Work Experience of Forklifts in Annexure-14. (b) A statement indicating details of equipment deployed and quality control measures adopted as in Annexure-11 shall be furnished. Copy of Quality Management System Certificates to be submitted.
(c) In case the bidder is an authorized dealer of manufacturer, a certificate with regard to design and manufacturing from by the manufacturer will be submitted along with the bid.
(d) In case the bidder is an authorized dealer of manufacture of Forklift, a certificate as per format Annexure-15 should be submitted along with bid document. xxx
PROFORMA FOR PERFORMANCE STATEMENT DETAILS OF OTHER CUSTOMERS Tender No........ Date of Opening....... Time...... Hours Name of the Firm SL. No. Order placed by (full address, email, telephone no. Fax No. Contact Person of Purchaser) Order No. and date Description & quantity of FORKLIFT Date of completion of delivery Remarks indicating reasons for late deliveries, if any Has the FORKLIFT/ been satisfactorily commissioned and is it giving trouble free service? As per contract Actual (Signature and seal of bidder) Note: The details of supply orders for the period of at least 3 years (36 months) prior to opening of the tender, should be furnished in above format."
PROFORMA FOR EQUIPMENT AND QUALITY CONTROL Tender No....................... Date of opening............... Time............. Hours. Name of the Firm................................................. (Note - All details required only for the items tendered)
1. Name & Complete Postal address of the firm
2. Telephone, Fax No. Office/Factory/Works
3. E-mail address
4. Location of the manufacturing factory
5. Details of Industrial Licence (if any) wherever required as per statutory regulations
6. Brief description of plant & machinery erected and functioning in each Deptt. (Monographs & description pamphlets be supplied if available).
7. Flow sheet of the process of manufacture of Forklift machines
8. Production capacity of Forklift Machine quoted for, with the existing plant & machinery Monthly Annual 8.[1] Normal 8.[2] Maximum
9. Brief details of arrangement for quality control of products such a laboratory, testing Equipment etc.
10. Organization chart of bidder to be enclosed.
11. Whether the Forklift machines are tested to any standard specification such as ISO, CE, if so, copies of specimen test certificates should be submitted. (Signature and seal of the manufacturer/Bidder)”
22. A cumulative reading of Clauses 2.1, 5.[4] along with Annexures-10 & 11 of the NIT only shows that the manufacturer has to show that it has supplied a machine which has been successfully installed. Similarly, Annexure-14 also requires the certificate to be given by the manufacturer. The Petitioner has established that it has fulfilled the eligibility criteria and, therefore, their bid ought not to have been rejected.
23. During the course of the hearing, this Court had directed the Respondent No.1 to open the financial bid of the Petitioner also and it transpires that the Petitioner is the lowest bidder.
24. In view of the above, the writ petition is allowed, along with pending application(s), if any. The Respondents are directed to proceed ahead in accordance with law.
SATISH CHANDRA SHARMA, CJ SUBRAMONIUM PRASAD, J JULY 04, 2023 hsk/ss