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2001 DIGILAW 51 (KER)

Asian Techs Ltd. v. State of Kerala

2001-01-22

G.SIVARAJAN

body2001
ORDER :- The matter relates to the contract work of "Tourism Department - Construction of new block to the Guest House, Ernakulam". The 3rd respondent-the Superintending Engineer, Buildings and local works, Public Works Department, Thrissur issued tender notification No. D8.3703/96 dated 30-6-2000 on 29-8-2000. Pursuant to the said notification, the petitioner, the 4th respondent and three others submitted their tenders. The work was awarded to the 4th respondent. The selection notice was issued to the 4th respondent on 9-11-2000. The 4th respondent executed the agreement on 14-11-2000 and the work started on 16-1-2000. The petitioner has filed this original petition on 18-11-2000. 2. The grievance of the petitioner is that though the tender submitted by the petitioner is the lowest among the 5, the work was arbitrarily given to the 4th respondent. The petitioner seeks for a declaration that they are entitled to the award of the said work and that their tender is the lowest. The petitioner also sought for a writ of prohibition restraining all further proceedings pursuant to the award of the work. 3. The 3rd respondent has filed a statement explaining the procedure adopted in the matter of award of the contract pursuant to the tender notification and justifying the grant is favour of the 4th respondent. The 4th respondent, who was awarded the work has also filed a statement. The petitioner has filed a reply affidavit. Along with the said reply affidavit he has produced certain pages of the tender documents as Ext. P3. 4. Learned senior Government Pleader appearing for respondents 1 to 3 has placed before the Court all the files relating to the award of the work in question. 5. The relevant clauses of the tender notification are given below : GOVERNMENT OF KERALA, PWD. BUILDINGS and LOCAL WORKS NOTICE INVITING TENDER TENDER NO. 9/SE/2000-2001/PQ/dt. 22-6-2000 1. The Superintending Engineer, P.W.D. Buildings and Local Works Central Circle, Thrissur invites on behalf of Government of Kerala. Competitive sealed tenders for pre-qualification and execution of work in Lump sum contract basis in three separate sealed covers. BUILDINGS and LOCAL WORKS NOTICE INVITING TENDER TENDER NO. 9/SE/2000-2001/PQ/dt. 22-6-2000 1. The Superintending Engineer, P.W.D. Buildings and Local Works Central Circle, Thrissur invites on behalf of Government of Kerala. Competitive sealed tenders for pre-qualification and execution of work in Lump sum contract basis in three separate sealed covers. (one cover for pre-qualification offer with EMD and Preliminary agreement, second cover for technical offer with design details and estimate (format I enclosed) and third cover the financial offer) superscribing the name of work and the nature of offer whether pre-qualification, technical offer or financial offer from eligible 'A' class contractors of Kerala PWD for execution of the project "Tourism Department". Construction of new block to the Guest House, Ernakulam" strictly in accordance with all the specifications and conditions as stipulated in tender documents. 1.2 The tenderer shall quote their rate in a Lump sum basis for the work with detailed estimate and rate for individual items (in the format II enclosed) based on the contractor's own structural design including furnishing of detailed designs, calculations, drawings and detailed specifications). 1.3 Sealed cover containing the pre-qualification offer and EMD with preliminary agreement will be first opened and evaluated by the pre-qualification committee of PWD. 1.4 The pre-qualification offer shall be streened on an objective evaluation of details regarding the past performance, technical and financial capabalities and resourcefulness of the tenderer. The pre-qualification committee reserves the right to reject any or all offers without assigning any reason thereof. 1.5 Technical offer (Design) of those tenderers which are found to be technically suitable upon evaluation of the pre-qualification offer will be opened and further considered for technical feasibility of the design by the PWD. The date and time for time will be notified later. 1.6 Financial offer of those tenderers whose technical offer (design) is found to be technically sound and financially viable, only will be opened and further considered for awarding the work. The date and time for this will be intimated later. The technical offer and financial offer of the tenderers who are not pre-qualified will be returned unopened. 1.6 Financial offer of those tenderers whose technical offer (design) is found to be technically sound and financially viable, only will be opened and further considered for awarding the work. The date and time for this will be intimated later. The technical offer and financial offer of the tenderers who are not pre-qualified will be returned unopened. 1.7 The project includes the following : The work is to be executed in one package as detailed below : Tenderer Superintending Engineer 1.10 The completed tender documents in three sealed covers (one for pre-qualification offer with EMD and preliminary agreement, one for Technical offer (design), and other for financial offer) and details duty filled up in all respects should reach the address given below on or before 4.00 p.m. on 9-8-2000 by post. Pre-qualification tender alone will be opened on that day at 4.30 p.m. The department will not take any responsibility regarding non receipt or delay in receipt in time of tenders sent by post. If the last date is declared as holiday the Employer or the receiving officer, the next official working day shall be deemed as the last date of receipt of the tenders. There will be a pre-bid meeting on 5-8-2000 at 11-00 a.m. at the office of the Superintending Engineer, Buildings and Local Works, Central Circle, Thrissur. xxx xxx xxx xxx 1.17 All tenderers are hereby cautioned that conditional offers or deviation from the conditions of contract or other requirements stipulated in the tender documents shall be summarily rejected as non responsive and shall not to be considered further in tender evaluation. xxx xxx xxx xxx 1.20 Testing of piles (about 2%) should be done by the contractor at his own cost. No cost will be born by this department for any kind of test required to be done by the contractor. xxx xxx xxx xxx 1.26 This notice inviting tenders shall also form part of the agreement along with others section of tender documents and agreement coditions." 6. Sri. No cost will be born by this department for any kind of test required to be done by the contractor. xxx xxx xxx xxx 1.26 This notice inviting tenders shall also form part of the agreement along with others section of tender documents and agreement coditions." 6. Sri. M. P. Abraham, learned counsel for the petitioner submits that in a 3 cover system of submission of tender, the condition of each cover is mutually exclusive and therefore when the 3rd cover which contains financial offer is opened thee is no role for the documents contained in the first and second covers in the matter of selecting the person to whom the work is to be awarded. The counsel expatiated the same by further submitting that the first cover contains the documents regarding pre-qualification, that once the said documents are screened as required in paragraph 1.4 of the notice inviting tenders (N.I.T.), then the second cover of those persons, whose tenders are found to be technically suitable will be opened for consideration of the technical feasibility of the design and that when it is found that the documents contained therein are technically sound and financially viable the 3rd cover which contains the financial offer will be opened. He submits that once the 3nd cover which contains the financial offer is opened the person who submitted the lowest tender has to be selected without reference to the documents contained in the first and second covers. The counsel further submitted that the financial offer submitted by the petitioner in cover No. 3 was an unconditional one undertaking to do the work for the amount quoted therein. He further submitted that the respondents have no case that the petitioner did not satisfy the requirements with regard to pre-qualification and the technical and financial feasibility required in the first and second covers. It is pointed out that the 3rd respondent in his communication dated 2-11-2000 had clearly stated that the design and sections submitted by the petitioner in the second cover are generally O.K. and therefore the date for opening the price bid of the work is fixed to 8-11-2000. It is also stated that the price bid (financial offer cover) of the contractors, who are unwilling to submit the undertaking in the prescribed proforma will be summarily rejected. The counsel submitted that the petitioner had executed the undertaking in the proforma (Ex. It is also stated that the price bid (financial offer cover) of the contractors, who are unwilling to submit the undertaking in the prescribed proforma will be summarily rejected. The counsel submitted that the petitioner had executed the undertaking in the proforma (Ex. P2) enclosed along with Ext. P1. He, on the basis of the above, submitted that by executing the undertaking contained in Ext. P2 the 3rd respondent has condoned/waived the conditions contained in the documents in the second cover. He also submitted that though it is stated in Ext. P2 undertaking that the shortfalls observed by the department will be made good the petitioner was not given any such opportunity after opening the financial offer. The counsel submitted that the 3rd respondent arbitrarily and with mala fide intention took into account the conditions contained in the technical offer, which was undertaken to be withdrawn in Ext. P2 undertaking and awarded the work to the 4th respondent taking the view that the financial offer of the 4th respondent is the lowest. He reiterated that the 3rd respondent was not justified in looking into the technical offer while considering the financial offer which has been done arbitrarily and illegally only to award the work to the 4th respondent. 7. Sri. K. K. Ravindranath, learned senior Government Pleader and the Liaison Officer appearing for the 3rd respondent, based on the averments made in the statement filed by the 3rd respondent and the details available in the Government files submitted that the selection of the 4th respondent for awarding the work was made strictly in accordance with the tender notification. It is pointed out that the representative of the petitioner was present at the time of opening of the second cover, that the fact of having submitted the conditional tender is also mentioned in the register of tender page 218, that among the 5 tenders only the petitioner had submitted conditional offer in the second cover, that as per clause 1.17 of the NIT, tenders with conditional offer are to be summarily rejected, that however, in order to identify the best competitive offer the tender with conditional offer submitted by the petitioner was not rejected at that stage and was accommodated for further total evaluation taking into consideration the financial implication of the conditions also. It is further pointed out that as per N.I.T. clause (4) detailed design for all structures including the piles have to be submitted in second cover, that the petitioner did not do so, that therefore only a general scrutiny of the provision given by the petitioner could be carried out in the absence of full details, that it is in those circumstances an undertaking was called for from the petitioner undertaking to make any deviation asked for by the department at his own cost and that this undertaking is not for facilitating withdrawal of the conditions already accepted by the department for evaluation of the tender submitted in cover 2. It is further pointed out that normally the second cover does not project any financial aspect. But the financial aspect of the conditional offer had to be taken into consideration while evaluating the financial offer in cover 3 so as to identify the best competitive offer, that the department has processed the tender with the good intention of getting the best competitive offer as explained earlier and that the second and third covers are interlinked so that the total evaluation can be made only by considering the contents of both the covers. It is also stated that after evaluating all financial aspects, the 4th respondent was the lowest and hence selection notice was issued to them on 9-11-2000, that they executed the agreement on 14-11-2000 and that in the meeting convened by the Hon'ble Minister for Tourism at Thiruvananthapuram on 6-11-2000 it was agreed upon by the department that the works will start at site on 15-11-2000 and that it is in the ab ove circumstances, the 4th respondent had commenced the work on 16-11-2000. The counsel also pointed out that as per the soil investigation report initial load test is to be conducted before commencement of the piling work for the building and that as per clause 1.20 of notice inviting tenders all costs of tests are to be borne by the contractor. The counsel also pointed out that as per the soil investigation report initial load test is to be conducted before commencement of the piling work for the building and that as per clause 1.20 of notice inviting tenders all costs of tests are to be borne by the contractor. It is pointed out that the rates submitted by the petitioner for piling did not include the cost of initial load test, but that was separately given as condition No. 5 to the effect that an additional amount of rupees 7 lakhs is to be given for initial load test and that it is in those circumstances a sum of Rupees 7 lakhs was also included to the financial bid for ascertaining the total bid amount. Besides the above, the petitioner (vide condition No. 7) has demanded 75% secured advance for steel, cement, lift, air condition, water supply, fire fighting, electrical items, etc., that there is no provision for advance payment, that the petititioner has (vide condition No. 9) offered only 100 users, septic tank in place of sewage treatment plant as specified by the department during the pre-bid meeting and the minutes of the pre-bid meeting form a part of the tender documents, that the petitioner (vide condition No. 3) also demanded by statutory increase in taxes and duties imposed by the Central or State Government and that it is taking into account all those matters the petitioner's tender could not be accepted. The Government Pleader in the above circumstances submitted that the entire procedure adopted by the 3rd respondent in the matter of selection of tender for award of the work in question was strictly in accordance with NIT and the accompanying documents and that the Board of Revenue has acted fairly in the matter. The senior Government Pleader relied on the decision of the Supreme Court in Tata Cellular v. Union of India (1994) 6 SCC 651 : (AIR 1996 SC 11) and submitted that judicial review is concerned only with the manner in which administrative decision is taken and that in judicial review proceedings the Court cannot sit as an appellate Court. He submitted that in the above circumstances, this Court may not interfere with the award of the work in favour of the 4th respondent. 8. Sri. He submitted that in the above circumstances, this Court may not interfere with the award of the work in favour of the 4th respondent. 8. Sri. S. A. Nagendran, senior counsel appearing for the 4th respondent also relied on the principles stated in the decisions of the Supreme Court mentioned above and submitted that this Court will interfere only if the decision making process is vitiated by illegality, irrationality or unreasonableness. He also submitted that unless the proceedings are vitiated by mala fides the Court will not interfere with the discretion exercised by the administrative authorities. The counsel refers to the terms and conditions contained in the technical offer submitted by the petitioner which is produced as Ext. R4(a) and submitted that if the financial implications contained in paragraphs 3 and 5 of Ext. R4(a) are also taken into account the financial offer of the 4th respondent is the lowest. He further submitted that pursuant to the selection memo dated 9-11-2000 the 4th respondent had executed the agreement on 14-11-2000 and the work started on 16-11-2000. He submitted that there is absolutely no illegality or irregularity in the selection made by the 3rd respondent. 9. So far as the scope of judicial review is concerned, the House of Lords in C.C.S.U. v. Minister for the Civil Service (1984) 3 All ER 935 has held that judicial review of administrative action can be classified under three heads, viz., 'illegality', 'irrationality' and 'procedural impropriety'. By illegality, it is meant that the decision maker must understand correctly the law that regulates his decision making power and must give effect to it. 'Irrationality' is referred to as 'Wednesbury unreasonableness'. Again the House of Lords in Nottinghamshire County Council v. Secretary of State for the Environment and another appeal (1986) 1 All ER 199 dealing with the abuse of powers of public authorities and the parameters for the exercise of power by the Court stated that examination by a Court would be justified only if a prima facie case were to be shown for holding that the authority had acted in bad faith, or for an improper motive. This is reiterated again in Puhlhofer v. Hillingdon London Borough Council. (1986) 1 All ER 467. This is reiterated again in Puhlhofer v. Hillingdon London Borough Council. (1986) 1 All ER 467. It is held that the ground on which the Courts will review the exercise of an administrative discretion is abuse of power, e.g. bad faith, a mistake in construing the limits of the power, and procedural irregularity or unreasonableness in the Wednesbury sense. 10. The Supreme Court in Tata Cellular v. Union of India, (1994) 6 SCC 651 : (AIR 1996 SC 11) observed as follows : "The principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. However, there are inherent limitations in exercise of that power of judicial review. The 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 of while accepting or refusing a tender. There can be no question of infringement of Art. 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." After detailed survey of the English and Indian decisions, the Supreme Court summarised the legal position at page 687 of the report thus : "(1) The modern trend points to judicial restraint in administrative action. (2) The Court does not sit as a Court of appeal but merely reviews the manner in which the decision was made. (3) The Court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. (5) The Government must have freedom of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. (5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (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." 11. The Supreme Court in Raunaq International Ltd. v. I.V.R. Construction Ltd., AIR 1999 SC 393 in the context of acceptance of a tender observed that often when an evaluation committee of experts is appointed to evaluate offers, the expert committee's special knowledge plays a decisive role in deciding which is the best offer, that the price offered is only one of the criteria and that the Court should not substitute its own decision for the decision of the expert evaluation committee. 12. Again the Supreme Court considered the law relating to award of contract by the State and its instrumentalities in Air India Ltd. v. Cochin International Airport Ltd., (2000) 2 SCC 617 : (AIR 2000 SC 801) and on a consideration of its earlier decisions (some of which are mentioned above) summarised the position thus : "The award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision considerations which are paramount are commercial considerations. The State can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. It can enter into negotiations before finally deciding to accept one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to be the highest or the lowest. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to be the highest or the lowest. But the State, its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot depart from them arbitrarily. Though that decision is not amenable to judicial review, the Court can examine the decision-making process and interfere if it is found vitiated by mala fides, unreasonableness and arbitrariness. The State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision-making the Court must exercise its discretionary power under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The Court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the Court should intervene." 13. It is also a settled position that the Court will not interfere with the administrative decision in awarding contract to an individual or a body unless there are vitiating circumstances like malice, favouritism etc. Similarly mala fides have to be specifically alleged and established. 14. The work, as already stated, is for the construction of a new block to the Guest House at Ernakulam. The 3rd respondent issued notification inviting tenders on 30-6-2000. As per the tender notification the tenders have to be submitted in separate sealed covers (one cover for pre-qualification offer with E.M.D. and preliminary agreement, second cover for technical offer with design details and estimate and the 3rd cover for financial offer). The tenderers have to quote their rate in a lump sum basis for the work with detailed estimate and rate for individual items based on the contractors' own structural design including furnishing of detailed designs, calculations, drawing and detailed specifications. The notification further provides that sealed cover containing the pre-qualification offer and EMD with preliminary agreement will be first opened and evaluated by prequalification committee of PWD. The notification further provides that sealed cover containing the pre-qualification offer and EMD with preliminary agreement will be first opened and evaluated by prequalification committee of PWD. This will be screened on an objective evaluation of details regarding the past performance, technical and financial capabilities and resourcefulness of the tenderer. The committee has got the right to reject any or all offers without assigning any reason thereof. The technical offer (design) of those tenderers which are found to be technically suitable upon evaluation of the prequalification offer will be opened for technical feasibility of the design by the P.W.D. The financial offer of those tenderers whose technical offer (design) is found to be technically sound and financially viable only will be opened and further considered for awarding the work. It is that there will be a pre-bid meeting on 5-8-2000. Clause 1.17 of the notification inviting tenders provides that all tenderers are hereby cautioned that conditional offers or deviation from the conditions of contract or other requirements stipulated in the tender documents shall be summarily rejected as non-responsive and shall not be considered further in tender evaluation'. Clause 1.20 provides that testing of piles (about 2% should be done by the contractor at his own cost. No cost will be borne by this department for any kind of test required to be done by the contractor'. Clause 1.26 states that the notice inviting tenders shall also form part of the agreement along with others section of tender documents and agreement conditions. 15. Pursuant to the tender notification, the petitioner, the 4th respondent and 3 others had submitted their tenders. The petitioner and the 4th respondent had passed in the pre-qualification evaluation. Ext. P1 communication issued by the 3rd respondent shows that the petitioner's designs and sections are generally O.K. The petitioner was therefore requested to attend the office of the 3rd respondent with proforma undertaking on stamp paper worth Rs. 50/-. It was also stated that the price bid (financial offer cover) of the contractors/firms who were unwilling to submit the undertaking in the prescribed proforma will be summarily rejected unopened. The petitioner in obedience to the said communication had executed the undertaking in the proforma Ext. P2. 50/-. It was also stated that the price bid (financial offer cover) of the contractors/firms who were unwilling to submit the undertaking in the prescribed proforma will be summarily rejected unopened. The petitioner in obedience to the said communication had executed the undertaking in the proforma Ext. P2. The performa undertaking shows that certain detail furnished while submitting the tender for the work does not fully satisfy the provisions in the N.I.T., that the undertaker realises that these defects have to be rectified. It further stated that the undertaker will make good all the short-falls observed by the department within the time limit specified after opening of the financial bid. There is a further undertaking that the undertaker will not putforward any claim over and above the financial offer amount in the event, the executed quantities exceed due to the deviations and alterations submitted later. Thus it would be clear that the department had okeyed the petitioner's designs and sections contained in the second cover subject to what is stated in Exts. P1 and P2. 16. The Executive Engineer, (Building Division) P.W.D., Ernakulam entrusted the work of soil investigation in respect of the proposed guest house building to M/s. Ben-Tech Soil Investigation, Maradu P.O., Cochin-682 304 who submitted the report which forms part of the tender documents. Based on the said report the Consulting Engineer observed that the actual capacity can be found out only by a load test and therefore it is advisable to conduct an initial load test before foundation design is finalised. It is thus clear that initial test was absolutely necessary for the construction of the proposed guest house building and that it did form part of the work under tender notification. It must be noted that as per Clause 1.20 of the N.I.T., testing of piles should be done by the contractor at his own cost and no cost will be borne by the department for any kind of test required to be done by the contractor. 17. As noted earlier, the second cover contains the technical offer with design details and estimates. It contains a brief description of the work itemised schedule of work including rates and amounts, design particulars, etc. The petitioner in his technical offer had stated that the lump sum amounts quoted for the work is subject to the terms and conditions enclosed. 18. As noted earlier, the second cover contains the technical offer with design details and estimates. It contains a brief description of the work itemised schedule of work including rates and amounts, design particulars, etc. The petitioner in his technical offer had stated that the lump sum amounts quoted for the work is subject to the terms and conditions enclosed. 18. A perusal of the terms and conditions enclosed in the technical offer shows that condition No. 5 states as follows : "5. Our rate is inclusive of test loading of one working pile of 1 metre dia only for a load of 11/2 times the design as specified in the tender. In case any initial test is to be done (testing to destruction) we have to be paid extra rate of Rs. 7 lakhs for one number of one metre dia pile." Besides the above, condition No. 3 provides that the amounts quoted for various items of work are based on the prevailing rates of taxes and duties as on the date of tender and that any statutory increase to taxes and duties imposed by the Central or State Government shall be reimbursed. In the conditions they also demanded monthly payments for all the works executed on pro rata basis. The 3rd cover, as already noticed, contains the financial offer. The petitioner has quoted a lump sum of Rupees 8,23,55,160/- for the work. It is also stated that the amount so quoted was unconditional and final. 19. As noticed, the petitioner had clearly stated that the lump sum amount quoted by them for the work is subject to the following conditions. I have already mentioned the relevant terms having financial implications in the preceding paragraph. A combined reading of the conditions enclosed along with technical offer and the financial offer contained in the third cover would show that the lump sum amount quoted by the petitioner at Rs. 8,23,55,160/- is for the work excluding the initial test mentioned in condition No. 5. Since the initial test is an essential part of the work for which tenders are invited Condition No. 5 contained in the technical offer (second cover) has necessarily to be taken note of while considering the cover containing the financial offer. 20. 8,23,55,160/- is for the work excluding the initial test mentioned in condition No. 5. Since the initial test is an essential part of the work for which tenders are invited Condition No. 5 contained in the technical offer (second cover) has necessarily to be taken note of while considering the cover containing the financial offer. 20. Here, it must be noted that the contention of the petitioner is that in a three cover system of submission of tender which consists of pre-qualification documents, technical offer and financial offer the procedure contemplated in the N.I.T. is to process the pre-qualification documents first, then to consider the technical offer of those persons who are pre-qualified and that once the pre-qualified persons satisfy the requirements of the technical offer the 3rd cover containing the financial offer will be opened and thereafter there is no question of going back either to the technical offer or to the pre-qualification documents for determining the financial offer. In other words, according to the petitioner, when once the cover containing the financial offer is opened that alone should be considered for making the selection. I am unable to agree with the said proposition. 21. The 3rd respondent had invited tenders for the work of Tourism Department-Construction of new block to the Guest House, Ernakulam' as per tender notification dated 30-6-2000. Though it was directed that the tenders must be submitted in 3 covers, really, the tender is one for the said work. It is only for the convenience of the department that the 3 cover system is introduced. Though the cover containing the pre-qualification documents are found first and pre-qualified persons are selected and then the cover containing the technical offer which contains the design details, estimate, etc. for satisfying as to whether the same is in order, it does not mean that those documents should not be considered while considering the question of selection of the tender for awarding the work. As already noted, the tender is one and all the details contained in the tender which takes in all the documents contained in the 3 covers have to be considered while making the selection. It must be noted that the tender is an offer and the tenders undertake to take up the work provided the terms and conditions contained in the said offer are agreeable to the department. It must be noted that the tender is an offer and the tenders undertake to take up the work provided the terms and conditions contained in the said offer are agreeable to the department. In this case, as already noted the petitioner had clearly stated in the documents submitted that their tender is subject to the terms and conditions enclosed. It is clearly stated in the terms and conditions that the 'lump sum amount quoted by us for the above work is subject to the following terms and conditions'. 22. I have already referred to the term and conditions. Though it is stated that the lump sum amount offered for the work in the financial offer is an unconditional one it must be noted that it is only for the work excluding the one specified in Condition No. (5). That apart, various other conditions which have got financial implications are also included in the conditions. So necessarily the department has to consider the terms and conditions included in the technical offer subject to which the lump sum amount is quoted in the financial offer. This is what the department has done. 23. The further contention of the petitioner is that though the petitioner had incorporated certain conditions in the documents contained in the second cover the same were given a go-by and/or condoned by the department by getting Ext. P2 undertaking from the petitioner. The case of the department is that Ext. P2 undertaking was obtained for the reason that the technical offer containing the design details, etc. were not complete in all respects and that it is in those circumstances Ext. P2 undertaking was required. The wording of the undertaking in Ext. P2 also is to the effect that certain details furnished while submitting the tender for the work does not fully satisfy the provisions in the N.I.T. and that the tenderer realises that these defects have to be rectified. It is in those circumstances the tenderers are required to undertake that they will make good all the short falls observed by the department within the time limit specified after opening of the financial bid. 24. I have perused the files produced by the department in respect of this work. It is seen that Ext. It is in those circumstances the tenderers are required to undertake that they will make good all the short falls observed by the department within the time limit specified after opening of the financial bid. 24. I have perused the files produced by the department in respect of this work. It is seen that Ext. P2 undertaking was required from all the tenderers, whose technical offers were found to be generally O.K. It must also be noted in this context that when the second cover containing the technical offer was opened it was specifically recorded that the technical offer submitted by the petitioner alone contained conditions. In other words, the tenders submitted by the other tenderers did not contain any conditions at all. In spite of the above, as already noted, all of them were required to submit the undertaking contained in Ext. P2 and all of them had submitted the same. This would clearly show that the undertaking was obtained only in respect of the defects/short comings in the designs, etc. and not with reference to the conditions. Here it must also be noted that the petitioner had not chosen to withdraw the conditions in spite of that it was specifically mentioned at the time of opening the second cover that the petitioner alone had submitted a conditional tender. In the above circumstances, there is no merit in the said contention also. 25. As already noted, the work with respect to which tenders were invited was inclusive of the initial test. The petitioner in condition No. 5 has stated that the lump sum amount quoted in the financial cover is in respect of the work excluding the initial test to be done for which extra amount of Rs. 7 lakhs for one number of one metre dia pile has to be paid. In this context it must be noted that none of the other tenderers including the 4th respondent had made any conditions subject to which the financial offer is made. In other words, they have undertaken to do the work including the initial test for the amount quoted in the financial offer. So taking the Condition No. 5 mentioned above, a minimum amount of Rs. 7 lakhs has to be added to the amount of Rs. 823.55 lakhs quoted by the petitioner in the financial offer. In other words, they have undertaken to do the work including the initial test for the amount quoted in the financial offer. So taking the Condition No. 5 mentioned above, a minimum amount of Rs. 7 lakhs has to be added to the amount of Rs. 823.55 lakhs quoted by the petitioner in the financial offer. Thus the lump sum amount quoted by the petitioner for the work comes to Rs. 830.55 lakhs. It must be noted that this is besides the other conditions, which also have got financial implications. For the reasons already mentioned, I do not find any merit in the contention of the petitioner that the financial offer contained in Cover 3 was unconditional. 26. Now coming to the rates quoted by the petitioner and the 4th respondent it could be seen that though the petitioner had quoted a sum of Rs. 823.55 lakhs only in the financial offer in view of the condition contained in paragraph 5 regarding the amount for the initial test to be conducted a minimum amount of Rs. 7 lakhs has to be added to the above. By adding the sum of Rs. 7 lakhs the financial offer comes to Rs. 830.55. The 4th respondent's unconditional offer was for Rs. 8,30,38,414/- which included the work of initial test also. The 4th respondent did not mention any condition as contained in the petitioner's technical offer such as additional demand for initial test, statutory increase in taxes and duties imposed by Central and State Governments, monthly advances etc. From the above it is clear that the offer made by the 4th respondent was the lowest. It must be noted that when offers of equally qualified persons are available, the choice is for the awarder to select the one which is commercially viable. Whereas the 4th respondent's offer was for undertaking the work for the amount of Rs. 8,30,38,414/- without any conditions the petitioner had offered to undertake the work only subject to conditions which enhances the financial burden and further the work in respect of some items is sought to be executed in variance from that contained in the tender conditions. The 3rd respondent, in such circumstances, had acted prudently and with due caution in not selecting the tender of the petitioner and selecting the 4th respondent for award of the work. The 3rd respondent, in such circumstances, had acted prudently and with due caution in not selecting the tender of the petitioner and selecting the 4th respondent for award of the work. There is neither illegality nor irrationality nor Wednesbury unreasonableness nor any procedural impropriety in the said administrative decision. Though the petitioner has alleged mala fide in paragraphs 3, 8 and also in Grounds 4 and 10 of the O.P. except the bald allegations, the petitioner could not make out a prima facie case of mala fides or favouritism in awarding the work to the 4th respondent. As the Supreme Court has held, mala fide is a matter which has to be specifically alleged and established. In the instant case, the petitioner could not establish any mala fides. There is also no material to show that the 3rd respondent was in any manner biased. Thus, I do not find any merit in this O.P. It is accordingly dismissed. Petition dismissed.