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1999 DIGILAW 1079 (PAT)

Kartik Kumar v. State of Bihar

1999-10-07

N.PANDEY

body1999
Order This petition under Article 226 of the Constitution of India is for an appropriate writ/order to quash the decision of the Board of Directors, Bihar Rajya Pool Nirman Nigam Limited (hereinafter to be referred as the 'Nigam') dated 9.3.1999, as contained in Annexure-11, whereby the construction work of Pantoon bridge, across the river Koshi at Vijaya Ghat, connecting Naugachhia and Dholbajja Bazar in the districts of Bhagalpur and Madhepura, was allotted in favour of Bharat Wagon & Engineering Company Limited (respondent no.7), as also the letter dated 8.7.1999, contained in Annexure-14, whereby, the said decision was communicated to the petitioner. I have heard all the relevant parties, therefore, with their consent this writ application is being disposed of at the stage of admission itself. 2. From the facts on record, it would appear that the Government of Bihar having regard to the need of general public, had sanctioned the concerned pantoon bridge, to be fabricated from steel materials such as, M.S. Plates, M.S. Angles etc. It was also decided to get this project executed by the 'Nigam' a Government Undertaking under the administrative control of the Road Construction Department. Since such a work was to be carried out by healthy skilled personnels, tenders were invited on 28.8.1998 in a daily newspaper, having a value or bill of quantity at Rs.2,79,20,400/-. Considering the importance of quality and fabrication, the Nigam also decided to make available the steel material components departmentally and, therefore, such a condition was also inserted in the tender document. Two tenders were received, one by the petitioner and the other on behalf of Bharat Wagon & Engineering Company Ltd. (respondent no.7). As per the terms of N.I.T., the tenderers were required to deposit Rs.5,58,500/- as earnest money in the shape of Post-Office Saving Bank Accounts Pass Book/Post Office Tie De Account (1, 2, 3 or 5 years) and/or National Savings Certificates (Vth, VIth, VIIth or VIIth) issued and pledged in favour of Senior Project Engineer, Bihar Rajya Pool Nirman Nigam Ltd., Works Division, Saharsa. The petitioner did not deposit the earnest money on a plea that the firm was a registered Small Scale Industry (S.S.I.) Unit. The second tenderer i.e. Bharat Wagon and Engineering Company Limited (respondent no.7) deposited the earnest money vide Allahabad Bank Fixed Deposit receipts on being pledged in favour of the 'Nigam'. 3. The petitioner did not deposit the earnest money on a plea that the firm was a registered Small Scale Industry (S.S.I.) Unit. The second tenderer i.e. Bharat Wagon and Engineering Company Limited (respondent no.7) deposited the earnest money vide Allahabad Bank Fixed Deposit receipts on being pledged in favour of the 'Nigam'. 3. On behalf of the petitioner, a condition was also imposed in the tender that steel materials will be procured by this tenderer from the Steel Authority of India Limited (SAIL) on a plea that in case of supply by the department, there are chances of undue delay in completion of the bridge. 4. The department as well as the Chief Engineer of the Nigam decided that both the tenderers may be called for negotiation for reducing the rate and also to waive the conditions imposed by them in the tender. On 16.11.1998 after negotiation, the petitioner agreed to reduce the rate to 10 per cent over B.O.Q. rates from 19.4 per cent whereas Bharat Wagon (respondent no.7) agreed to reduce the rate to 9 per cent over the B.O.Q. rates i.e. 1 per cent less than the negotiated offer of the petitioner. It was further discovered that the petitioner failed to deposit Sales Tax Clearance Certificates, Registration of Contractor Certificate, S.S.I. Unit Certificate, Labour Licence etc. That apart, only one of the partners had signed the tender document and there was no power of attorney on behalf of the other partners in favour of such a person. 5. On 28.11.1998 a letter was written by the petitioner to the Managing Director that all the required documents will be produced at the time of agreement. But the condition to supply materials by the contractor was reiterated. The Tender Committee, consisting of the Managing Director as its Chairman, in its meeting dated 4.2.1989 considering that the petitioner's firm had agreed to complete the work within a period of nine months and had also reduced the rate to 10 per cent made recommendation before the Board of Directors for allotment of work in its favour. But having regard to the conditions, imposed by the petitioners in the lender as also having regard to the lacking of different requirements, the Board of Directors decided to allot the construction work to Bharat Wagon (respondent no.7). Thereafter, the agreement was also executed on 17.5.1999 and the work order was issued. But having regard to the conditions, imposed by the petitioners in the lender as also having regard to the lacking of different requirements, the Board of Directors decided to allot the construction work to Bharat Wagon (respondent no.7). Thereafter, the agreement was also executed on 17.5.1999 and the work order was issued. It would further appear from the counter affidavit filed on behalf of Bharat Wagon (respondent no.7) that execution of work as well as supply of raw materials has already started for necessary fabrication of bridge. 6. Learned counsel for the petitioner contended that the decision of the Board of Directors of the 'Nigam' to allot construction work in favour of respondent no. 7 was completely malafide and arbitrary. Because from a bare reference to the facts, noticed above, it would appear that the petitioner being the lowest tenderer was only entitled to get the work. It was also contended that the Board of Directors failed to appreciate that the petitioner being a registered S.S.I. Unit was not required to deposit earnest money. Therefore, on this ground also the tender form of the petitioner could not have been rejected. Learned counsel further contended that even the Tender Committee of which the Managing Director was the Chairman after considering all the relevant materials had recommended before the Board of Directors for grant of tender in favour of the petitioner. But the Board of Directors arbitrarily ignored the decision of the Tender Committee and took a decision for allotment of construction work in favour of respondent no.7. 7. On the other hand, it was contended on behalf of the respondent that the Board of Directors being the final authority of the 'Nigam' was vested with the powers to accept or reject the recommendation of the Tender Committee. The Chief Executive i.e. the Managing Director was only delegated with the powers for day-to-day functions regarding execution of programmes and plans to achieve the objectives set out in the Memorandum of Association. Therefore, the Board of Directors having noticed that there ,were several defects in the tender of the petitioner including lacking of the deposit of the earnest money and further having regard to the unacceptable condition of the petitioner for supply of steel material components by the Contractor, took decision to allot the tender work to the Bharat Wagon (respondent no. Therefore, the Board of Directors having noticed that there ,were several defects in the tender of the petitioner including lacking of the deposit of the earnest money and further having regard to the unacceptable condition of the petitioner for supply of steel material components by the Contractor, took decision to allot the tender work to the Bharat Wagon (respondent no. 7), which is a Government of India Undertaking, on which a better reliance can be placed regarding qualities and workmanship for fabrication of the Pantoon bridge. The Board of Directors also took exception to the decision of the Managing Director, since it was completely against the terms and conditions of the tender notice. Apart from the aforesaid, the past performance regarding fabrication of such work of the Bharat Wagon was also found quite satisfactory in comparison to the petitioner. 7. From the materials noticed above, there appears no dispute that the rate quoted by the petitioner for the fabrication work was certainly lower to that of the Bharat Wagon. Therefore, in normal course construction work should be allowed in favour of a tenderer, which had offered the lower rate. But undisputedly acceptance of such offer depends upon fulfilment of other conditions of the tender notice. In case other conditions are not fulfilled the offer of a lowest tenderer can be safely rejected. In this case, as I have already noticed, the petitioner inspite of a chance for negotiation did not accept the terms and conditions of the 'Nigam' regarding supply or the steel material components departmentally, which was one of the conditions inserted in the tender document that M.S. Plates, R.S. Joints, Grider Angles, M.S. Channels and Plates etc. would be issued by the 'Nigam' at the rates given in the tender document at Schedule-X. Apart from the aforesaid, it has also been noticed that even the earnest money was not deposited by the petitioners on a plea that firm was registered as a S.S.I. Unit. It would further appear that on negotiation, which took place on 8th March, 1999, the Bharat Wagon had also reduced the rate to 9 per cent over and above the B.O.Q. rates i.e. 1 per cent below the negotiated rate offered by the petitioners. Therefore, in my view, there appears nothing wrong if the Board of Directors took a decision to allot the tender work in favour of Bharat Wagon (respondent no. 7). 8. Therefore, in my view, there appears nothing wrong if the Board of Directors took a decision to allot the tender work in favour of Bharat Wagon (respondent no. 7). 8. Apart from the aforesaid, one has to bear in mind that any judicial relief at the instance of a party, which does not fulfil the requisite criteria of the advertisement would be misplaced. The Court must be satisfied that there is some element of public interest involved in entertaining such a petition. In this case, as I have already noticed that after the allotment of the contract work, the Bharat Wagon after executing the agreement had also started fabrication work for the project. Therefore, even in case of a mere difference in the price offered by the two tenders, unless the court is satisfied that there is a substantial amount of public interest, or the transaction is entered into malafide, the court should not intervene under Article 226 of the Constitution in disputes between the two rival tenderers. Reference in this regard can be usefully made to a decision of the Apex Court in the case of Raunaq International Ltd. vs. I.V.R. Construction Ltd. & Ors., A.I.R. 1999 SC 393. 9. In this case, as noticed above, the State Government having regard to the dire need of general public of the concerned locality took a decision as back as in the year, 1997 to construct a pantoon bridge across the river Koshi, since a regular construction of bridge requires enomerous amount and the State was not in a position to make such a huge expenditure. But due to the disputes between the rival tenderers in spite of the execution of agreement etc. and allotment of tender work the object has not been achieved as yet. 10. I, therefore, taking into consideration the facts, stated above, find no reason to quash the impugned decision of the Board of Directors of the 'Nigam'. In the result, this writ application fails, as devoid of any merit.