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2002 DIGILAW 1213 (DEL)

EVEREST ENTERPRISE v. NIPC

2002-08-19

MUKUL MUDGAL

body2002
MUKUL MUDGAL ( 1 ) THIS writ petition challenges the Limited Tender, issued on the 17th June, 2002, by respondent No. 1 for annual Maintenance Contract (hereinafter referred to as amc for specialized upkeep and maintenance of the noida Township of National Thermal Power Corporation which admittedly is amenable to the writ jurisdiction of this Court as covered within the meaning of the Article 12 being held wholly owned Government undertaking and 100% shares being held by the President of India. ( 2 ) THE writ petitioner avers as under : the petitioner is aggrieved by the action of the respondent No. 1 in calling for AMC without issuing any letter or bid documents to the petitioner, who is the existing contracter and has been registered contractor with the respondent No. 1 for the last 8 years. On 1st may, 1994, the petitioner was appointed as a contractor by the respondent No. 1 for fouse-keeping and sanitation continuously working with respondent No. 1. On 11th august, 2000, the petitioner was awarded contract for specialized upkeep and maintenance of Candd Type Quarter in ntpc Township at Noida for a period of one year and this contract, was extended on 1st August, 2001. This maintenance contract for Cando Type quarters in NTPC township NOIDA is the subject matter of the present dispute. Significantly, the contract was for a period of one year extenadable at the sole discretion of NTPC by another one year. It is not in dispute that the contract of the petitioner was extended on 1st of August, 2001. The petitioner has contended that it has been Kept out of the tender process for the future tenders issued on 17th june, 2002 without any notice or cause and thus has been discriminated against. On coming to know that the petitioner was wrongly excluded from the tender process, a representation was made by the petitioner to the respondent No. 1 by a letter dated 25th July, 2002 which demonstrated the malice and the hostile and arbitrary treatment to the petitioner by some senior officers. On coming to know that the petitioner was wrongly excluded from the tender process, a representation was made by the petitioner to the respondent No. 1 by a letter dated 25th July, 2002 which demonstrated the malice and the hostile and arbitrary treatment to the petitioner by some senior officers. ( 3 ) BY way of illustration of the bias of the respondent, the petitioner submitted that tenders were earlier invited on 19th July, 2001 for the maintenance contract for PMI sector 16 A NOIDA and the petitioner was found to be the lowest bidder but even then the petitioner bid did not find favour with the respondent. This bid was therefore not finalized and again a limited tender was invited on 1st of March, 2002 and the petitioner s bid for PMI was still the lowest and yet against the bid was cancelled and the contract was awarded to Sulabh International which had not even submitted its bid. The Sulabh International was granted the contract at a price of Rs. 55,024/- per month as against the petitioner s quotation of Rs. 25,997/- per month which was not found acceptable. It was further submitted that the petitioner s work had been satisfactory and no adverse comment had been made by respondent against it nor any show cause notice has been issued by the respondent No. 1, corporation against the petitioner. Consequently the petitioner who is the existing contractor, figuring on the approved tenderers list, could not have been excluded from the Limited Tender dated 17th June, 2002. The petitioner s case is that the tenders were invited from approved vendors and the petitioner was working as an approved vendor and thus respondent No. 1 wrongly denied the bid documents to the petitioner. The representation of the petitioner dated 25th July 2002 which complained against the unfair treatment awarded to it, not having been replied to and the petitioner having coming to know of the awarding of the contract on 1st august, 2002 it approached this Court by serving an advance copy on the respondent on 30th July, 2002. Notice in the writ petition was issued on 6th august, 2002 and order of status quo was passed. The writ petition was heard on 8th august, 2002 and judgement was reserved. Notice in the writ petition was issued on 6th august, 2002 and order of status quo was passed. The writ petition was heard on 8th august, 2002 and judgement was reserved. ( 4 ) THE respondent No. 1 by its counter affidavit, however, does not dispute the plea of the petitioner that it is an approved vender and working contractor. It merely states that the letter for invitation were only issued on 17th June, 2002 to the approved vendors. However, it is pleaded that the petitioner being a working contractor was aware of the contracting process and it has been submitted that the plea of the petitioner on coming to know of the limited tender dated 17th June, around 25th July 2002 is not correct as being a working contractor, the petitioner whould have know of 17th June, 2002 tender and the representation made by it on 25th July, 2002 is an afterthought. However, It has not been stated in the counter affidavit as to whether any reply , was sent to the petitioner s represenation dated 25th July, 2002. It has also been averred that the petitioner s name does not figure in the list of approved vendors because of its bad performance and low quality work. ( 5 ) IT has been averred that the letter of award has already been issued to the M/s Walia and Sons on 2nd august, 2002. However it has not been explained as to why this has been done in spite of the service of the copy of the petition on the respondent No. 1 on 30th july, 2002. The counter itself states that the petitioner s work was not satisfactory and the petitioner was sent letters to this effect time and again. Thus in the counter respondent No. 1 admits that the petitioner has been excluded on the ground of inefficient and unsatisfactory work. However, it is interesting to note that the respondent No-1 has not denied the plea that the petitioner s name did figure in the letter dated 6th June, 2001 by which Limited Tender enquiry was issued for the last year to the petitioner and thus it was an approved vendor at least till 6th june, 2001. However, it is interesting to note that the respondent No-1 has not denied the plea that the petitioner s name did figure in the letter dated 6th June, 2001 by which Limited Tender enquiry was issued for the last year to the petitioner and thus it was an approved vendor at least till 6th june, 2001. The letter dated 1st March, 2002 of NTPC also shows that the petitioner is on the approved list as the petitioner was issued bid for providing specialized cleaning, Maintaining services at PMI, sector-16a, Noida. ( 6 ) THE course of conduct of respondent No. 1 does demonstrate that the petitioner is fully justified in the grievance that it has been wrongfully denied the bonder documents. The respondent No. 1 had not denied that the representation of the petitioner dated 25th july, 2002 was not replied to and the explanation now nought to be given that it was not done as the representation was "an after though, merit less and of no consequences. ". In so far as laches is concerned, the respondent No. 1 contended that the petitioner was aware about the tender exercise but has not demonstrated how the petitioner was aware or had been made aware of the issuance of the tenders impugned. Secondly the lack of tespouse to the petitioner s representation lends substance to the petitioner s plea that it was being subjected to hostile discrimination and thus the plea of laches cannot be held against the petitioner. ( 7 ) IT is not in dispute that the petitioner is a working and an approved vendor as the averment of the petitioner in the writ petition to this effect was not denied by the respondent No. 1 specifically in its counter affidavit. The respondent No. 1 has sought to justify the denial of the tender to the petitioner on the ground that its procurement and work policy submitted that the list of approved vendors is reviewed and necessary changes made on the basis of performance at the time of issuance of notice inviting tenders. ( 8 ) IT is stated that the previous performance was reviewed and necessary changes Mere made on the basis of tendor performance on 12th June, 2002. ( 8 ) IT is stated that the previous performance was reviewed and necessary changes Mere made on the basis of tendor performance on 12th June, 2002. It is averred that the name of the petitioner did not figure on the approved tenders listist on account of unsatisfactory performance and for this purpose, reliance has been placed on 2 letters dated 4th April, 2002 and 2nd May, 2002 sent in respect of PMI contract to the petitioner. The petitioner in reply has however relied upon the following certification for PMI contract given by the respondent s Supervisor (administration) 5th April, 2002 and 3rd May, 2002 :- "work has been carried out satisfactory as per LOA all the terms and conditions of the contract/loa has been fulfilled. All the statutory obligation has been completed by the agency. "the petitioner s counsel has contended that the certification on 5th April, 2002 and 3rd May, 2002 by the respondent No. 1 s own Supervisor belies the plea of the respondent that the petitioner s services were not satisfactory. He states that obviously the letters dated 4th Aptii and 2nd May 2002 complaining unsatisfactory services in respect of PWI tender could not have been sent and are motivated even if they were sent, as these fly in the face of the certification of satisfactory work given by the respondents own supervisior. ( 9 ) THE PMI contract s performance cannot have a direct bearing in the present writ petition which is in respect of Candd quarters in NTPC. Even if the performance in PMI is considered relevant then the certification of the supervisor (administration) dated 5th April and 3rd May 2002 is in favour of the petitioner demonstrates eloquently that the letters dated 4th April and 2nd May 2002 appeared to have been issued regarless of the certificates, lending substances to the petitioner s plea that there is a hostile discrimination against it and clear non application of mind. ( 10 ) THE real issue which arises in the present writ petition is the petitioner s removal from the approved vendors list on 12th June 2002 and it has been contended by the respondent that this Mas done after reviewing the petitioner s performance. ( 10 ) THE real issue which arises in the present writ petition is the petitioner s removal from the approved vendors list on 12th June 2002 and it has been contended by the respondent that this Mas done after reviewing the petitioner s performance. No other judgement except two letters dated 4th April and 2nd May nor that too in respect of another contract at PWI were brought before the Court to demonstrate the unsatisfactory performance of the petitioner or any communication to the petitioner that his work was not satisfactory Significantly the letter dated 12th June 2002 which is relied upon by the respondent to exclude the petitioner is in fact also the proposal for tender for the AMC involved in the present case. The petitioner s exclusion is based on the following note in the said letter dated 12th June, 2002. "m/s Everest Enterprises was awarded the house Keeping Job at Township and PMI two years back for the period of one year extendable for another one year. Their performance at PMI was not found satisfactory. Copy of note duly approved from ED (PWI) is enclosed for reference. Keeping in view of the same name of M/s everest Enterprises has not been proposed fot issurance of LTE against the case. "the petitioner has thus been excluded on the alleged unsatisfactory performance in PMI. The respondent has defended this exclusion on the ground that it is open to the respondent to prepare a limited vendor list and in support of this reliance has been placed on a judgment of the Division Bench of this Court n. J. Contractors and Engineers and Another Vs MTNL Others 1995 (2) Arbitration Law Reports 495 where the process of Limited tenders was approved. The reliance on the said judgement is misplaced as the petitioner has not challenged the approved limited list of vendors but has challenged his exclusion from the said vendors list for no fault of his. The petitioner has relied upon the judgement of the Hon ble Supreme Court in M/s Sauthern painters Vs. Fertilizer and Travancore Ltd. reported as AIR 1994 SC 1277 . The relevant portion of the said judgement relied upon by the petitioner reads as follows : "9. The petitioner has relied upon the judgement of the Hon ble Supreme Court in M/s Sauthern painters Vs. Fertilizer and Travancore Ltd. reported as AIR 1994 SC 1277 . The relevant portion of the said judgement relied upon by the petitioner reads as follows : "9. The deletion of the appellant s name from the list of approved contractors on the ground that there were some vigilance report against it, could only be done consisent with and after the compliance of the principles of natural justice. That not having been done, it requires to be held that withholding of the tender form from the appellant was not justified. In out opinion, the High Corurt was not justified in dismissing the writ petition. "the principle laid down in the aforesaid judgment squarely applies to the facts of the present case. The petitioner s name having been excluded on the ground of unsatisfactory services could not have been done by the respondent when no opportunity or notice had been given to the petitioner before excluding its name from the vendor s list. The only two documents shown to this court i. e. the letters dated 4th April and 2nd May 2002 have been found to be wholly untenable in view of the certificates of the petitioner given by the supervisor on 5th April and 3rd May, 2002 about the satisfactory performance of the petitioner. In fact these documents pertain to another contract of PMI, Sector 16a, NOIOA and not the contract in the present case i. e. the contract for maintenance of Cando Quarter in NTPC Township noida. However, we are proceeding on the assumption that since both the petitioner and respondent are common, the nature of the services provided by the petitioner even in another contract can be considered. thus we find that the petitioner s name has been wrongly excluded from the approved vendors list by the respondent in clear violation of the principles of natural justice without any notice whatsoever to It. Accordingly the writ petition is liable to be allowed. The decision of the limited tender issued on 17th June 2002 by the respondent is quashed and set aside on the ground of illegal exclusion of the petitioner from the approved list. Accordingly the writ petition is liable to be allowed. The decision of the limited tender issued on 17th June 2002 by the respondent is quashed and set aside on the ground of illegal exclusion of the petitioner from the approved list. It is open to the respondent to float tenders afresh and the petitioner is permitted to participate in the said tender alongwith other approved vendors and will be issued the appropriate tender and other documents for this purpose. The interim order of this court dated 6th August 2002 to continue until the contract is awarded to the successful tenderer pursuant to the fresh tendering as directed by this judgment, ( 11 ) WITH the above direction the writ petition is allowed and stands disposed of in the terms of the directions given in this judgment.