Full Text
HIGH COURT OF DELHI
Date of Decision: 06th November,2019
M/S SILICA INFOTECH PVT. LTD.(SAHARSA)..... Petitioner
Through: Mr.Vipul Ganda, Mr.Vikas Yadav, Ms.Dipika Ganda and Mr.Aman
Chaudhary, Advts.
Through: Mr.Ashim Sood, CGSC for R-1.
Ms.Meenakshi Arora, Sr.Adv. with Ms.Mala Naryan, Ms.Neha Dawar, Mr.Rahul Narayan and Mr.Digvijay, Advts. for R-2/IOCL.
HON'BLE MR. JUSTICE ANUP JAIRAM BHAMBHANI G.S.SISTANI, J. (ORAL)
JUDGMENT
1. This petition has been filed by the petitioner under Article 226 of the Constitution of India seeking a writ of mandamus against the respondents to quash decision dated 26.03.2019 of respondent No.2, whereby it is contended that the technical bid of the petitioner was rejected without giving any justifiable reasons and with the sole motive to favour another bidder.
2. Some necessary facts which are required to be noticed for disposal of this writ petition are that on 11.07.2018, a notice was issued by 2019:DHC:5801-DB respondent No. 2 inviting E-tender for setting-up new LPG Bottling facilities at 60 different locations from private bottlers having ready built plant/willing to construct new LPG bottling facility.
3. Accordingly, a common tender for all 60 identified locations was floated. The object was that the successful bidder should be able to create adequate plant and infrastructural facilities and possess competence to engage in the activities required for handling of the LPG bottling operations with caution and safety.
4. The petitioner claims to be a registered company dealing in LPG products since 2013 and having sound financial track record to carry-out the work of refilling LPG cylinders by establishing a new bottling plant.
5. The petitioner company participated in the E-tender issued by respondent No. 2 for one location i.e. Saharsa and submitted the required documents.
6. On 03.12.2018 a techno-commercial query was raised by respondent NO. 2 on its e-portal, which was duly replied to by the petitioner company on 10.12.2018. After evaluation of the pre-qualification criteria, eligibility criteria and technical bid documents, the petitioner was found eligible for Round II; and was interviewed on 23.01.2019, when original digital records were submitted on the e-portal. After the interview, the petitioner was found eligible for Round III and was called for site- inspection.
7. The complaint of the petitioner is that the technical bid of the of the petitioner has been rejected after site inspection in Round III without respondent No.2 giving any cogent grounds/reasons for doing so.
8. Mr. Ganda, learned counsel for the petitioner submits that within 24 hours of rejection of the petitioner’s technical bid, respondent No. 2 hurriedly fixed the time for opening of financial bid on 27.03.2019 at
4.10 p.m. Mr. Ganda further submits that the rejection of the tender by the respondents is baseless, mala fide and arbitrary; and has been done with a view to accommodating particular parties, in whose favour respondent No.2 had pre-decided that the tender should be awarded. Site at Saharsa
9. Mr. Ganda submits that the purported ground of rejection of the technical bid of the petitioner was that the names of the co-owners of the plot offered by the petitioner as appearing in the land revenue records are different from the names that find mention in the lease deed submitted by the petitioner. It is submitted that the lessor mentioned in the lease deed is the son of the co-owner mentioned in the revenue records. The co-owner, being an ailing octogenarian, had consented that his son should execute the lease deed while bearing witness to the same at the time of registration before the Registrar. Thus, the decision of respondent No. 2 in rejecting the technical bid of the petitioner is without any cogent reason and is arbitrary.
10. Ms. Meenakshi Arora, learned senior counsel for the respondent No.2 submits that the petitioner was provided one final opportunity to submit the registered lease deed with respect to the offered plot. After availing such opportunity, the petitioner submitted a lease deed; however, after examining the revenue records, it was found that the names of the owners as recorded in the revenue records were different from those mentioned in the lease deed. To buttress this argument Ms. Arora relies upon Clause A of Part II of Pre-Qualification Criteria and Clause 9 (Round I) of the tender document, which we reproduce below: - “Part II. For Bidders Willing to Construct New Bottling Plant at the advertised Location:
11. We have heard learned counsel for the parties and have considered their rival submissions.
12. Though Mr. Ganda strongly contends that all co-owners of the offered land have consented to the lessors, whose names find mention in the lease deed, to execute the said lease deed. However, a perusal of the lease deed and land revenue records annexed at pages 56 and 61 of the petition show that the names of the owners in the revenue records are Shri Dev Dat Yadav and Smt. Bhibha Devi; whereas the names mentioned as lessors in the lease deed are Smt. Bhibha Devi and Mr. Nirmal Kumar Yadav. No documents were submitted by the petitioner to explain the difference of names in the said two documents. Based upon Clause A of Part II of the Pre-Qualification Criteria, it is clear that the submission of a registered lease deed was an essential condition of the tender, which the petitioner failed to comply with in view of the material discrepancy in the lease document submitted.
13. The law on the scope of judicial review in tender matters is well-settled. A brief reference to some judicial precedents may not be out of place. In the case of Tata Cellular v. Union of India reported as (1994) 6 SCC 651, the Supreme Court held as under: "70....the principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. However, it must be clearly stated that there are inherent limitations in exercise of that power of judicial review. Government is the guardian of the finances of the State. It is expected to protect the financial interest of the State. The right to refuse the lowest or any other tender is always available to the Government. But, the principles laid down in Article 14 of the Constitution have to be kept in view while accepting or refusing a tender. There can be no question of infringement of Article 14 if the Government tries to get the best person or the best quotation. The right to choose cannot be considered to be an arbitrary power. Of course, if the said power is exercised for any collateral purpose the exercise of that power will be struck down." xxxx xxxx xxxx xxxx
(including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides. (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure."
14. Thereafter in the case of Afcons Infrastructure Limited v. Nagpur Metro Rail Corporation Limited and Another reported as (2016) 16 SCC 818, the Supreme Court held as under:
the constitutional court interferes with the decision-making process or the decision."
15. Following the principles of Tata Cellular (supra) and Afcons Infrastructure Limited (supra) the Supreme Court in Municipal Corporation, Ujjain and Another v. BVG India Limited and Others reported as (2018) 5 SCC 462, has further held as under:
16. Also, in Silppi Constructions Contractors v. Union of India and Another reported as 2019 SCC OnLine SC 1133, the Supreme Court has held as under:
the aforesaid decisions has cautioned time and again that courts should exercise a lot of restraint while exercising their powers of judicial review in contractual or commercial matters. This Court is normally loathe to interfere in contractual matters unless a clear-cut case of arbitrariness or mala fides or bias or irrationality is made out. One must remember that today many public sector undertakings compete with the private industry. The contracts entered into between private parties are not subject to scrutiny under writ jurisdiction. No doubt, the bodies which are State within the meaning of Article 12 of the Constitution are bound to act fairly and are amenable to the writ jurisdiction of superior courts but this discretionary power must be exercised with a great deal of restraint and caution. The Courts must realise their limitations and the havoc which needless interference in commercial matters can cause. In contracts involving technical issues the courts should be even more reluctant because most of us in judges' robes do not have the necessary expertise to adjudicate upon technical issues beyond our domain. As laid down in the judgments cited above the courts should not use a magnifying glass while scanning the tenders and make every small mistake appear like a big blunder. In fact, the courts must give “fair play in the joints” to the government and public sector undertakings in matters of contract. Courts must also not interfere where such interference will cause unnecessary loss to the public exchequer.
tender, and has authored the tender documents is the best judge as to how the documents have to be interpreted. If two interpretations are possible then the interpretation of the author must be accepted. The courts will only interfere to prevent arbitrariness, irrationality, bias, mala fides or perversity. With this approach in mind we shall deal with the present case."
17. In view of the above discussion, we do not find any ground to interfere in the decisions taken by respondent No. 2. We accordingly find no merit in the petition; which therefore stands dismissed. CM APPL. 18423/2019 (stay)
18. In view of the order passed in the writ petition, the application also stands dismissed. G.S.SISTANI, J ANUP JAIRAM BHAMBHANI, J NOVEMBER 06, 2019 //