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2006 DIGILAW 1407 (BOM)

B. Himmatlal Agrawal v. Western Coalfields Ltd.

2006-09-07

D.D.SINHA, S.R.DONGAONKAR

body2006
D. D. SINHA, J.:- Rule returnable forthwith. Heard finally by consent of Shri. Bhangde, learned Senior Counsel, assisted by Shri. Samarth, learned Counsel for the petitioners, Shri. Mehadia, learned Counsel for the respondent Nos.1 to 3 and Shri. Manohar, learned Senior Counsel, assisted by Shri. Anjan De, learned Counsel for the respondent No.4. 2. Shri. Bhangde, learned Senior Counsel for the petitioners, contended that respondent No.2 has published tender notice No.6/2006-07 dated 2-5-2006, whereby sealed tenders were invited in two bid system for transportation of coal by hiring of equipment such as pay loaders and tippers etc. from Gondegaon O.C. Mines of Nagpur area to Godhni Railway siding, from the experienced and reputed Contractors, who have in their name a prime Contractor experience of having successfully executed works of similar nature (Removal of coal from Face/Coal transportation/ Wagon loading/Removal of shale/Removal of extraneous material etc.) valuing 65% of the annualized value of the work put to tender in any year during last 7 (seven) years ending last day of month previous to the one in which bid applications are invited [Annualized value of work is Rs.14,33,18,500/- and 65% of the annualized value works to Rs.9,31,57 .057 .50 say Rs.9,31,57,000/-]. The learned Senior Counsel for the petitioners further contended that the petitioners submitted their bid along with others, including respondent No.4 as per the schedule mentioned in tender document. It was contended that condition No.3 of tender documents stipulates qualification of tender. Clause 3.1 contemplates that in the event pre-qualification of potential bidder or bidders has been undertaken, only bids from pre-qualified bidders will be considered for award of contract. These qualified bidders should submit with their bids any information updating their original pre-qualification applications or, alternatively, confirm in their bids that the originally submitted pre-qualification information remains essential correct as of the date of submission of bid. The learned Senior Counsel for the petitioners further contended that Clause 3.2 of the tender document stipulates that if the employer has not undertaken pre-qualification of potential bidders, all bidders shall require to include the information and documents mentioned in clauses (a) to (k) with their bids. The learned Senior Counsel for the petitioners further contended that Clause 3.2 of the tender document stipulates that if the employer has not undertaken pre-qualification of potential bidders, all bidders shall require to include the information and documents mentioned in clauses (a) to (k) with their bids. Shri. Bhangde, learned Senior Counsel submitted that the intending bidder was required to submit a declaration in support of the authenticity of the credential submitted by him along with the tender in the form of affidavit as per the format provided in the bid document as Annexure A-1, as mentioned in the note in Clause 3.2. 3. Shri. Bhangde, learned Senior Counsel for the petitioners, further contended that Clause 3.3 stipulates that the bidder, who shall fulfill the conditions mentioned in sub-clauses (a) to (d) of clause 3.3 would qualify for award of contract. Those conditions are (a) The intending tenderer must have in his name as a prime Contractor experience of having successfully executed works of similar nature (such as transportation of coal/ removal of coal and wagon loading/removal of shale/removal of extraneous materials etc. for coal transportation) valuing 65% of the annualized value of the work put to tender in any year during 7 (seven) years ending last day of month previous to the one in which bid applications are invited. (b) Evidence of possessing adequate working capital (at least 20% of the annualized value of this work) inclusive of access to lines of credit and availability of other financial resources to meet the requirement. (c) Ownership of a fleet of minimum 1/3rd of the tipping truck/trucks and equipments required for the annualized work. (d) Financial turn over and cost of completed works of previous works shall be given a weightage of 5% per year (Average annual rate of inflation to bring them it at current price level). The learned Senior counsel for the petitioners contended that Clause 3.4 of the tender document stipulates that subcontractors' experience and resources will not be taken into account in determining the Bidders' compliance with qualifying criteria. 4. The learned Senior counsel for the petitioners contended that Clause 3.4 of the tender document stipulates that subcontractors' experience and resources will not be taken into account in determining the Bidders' compliance with qualifying criteria. 4. Shri. Bhangde, learned Senior counsel for the petitioners, contended that conditions mentioned in Clause 3.5 of the tender document are relevant for the controversy in issue, which read thus : "3.5 : Even though the bidders meet the above qualifying criteria, they are subject to be disqualified if they have: (a) made misleading or false representations in the forms, statements and attachments submitted in proof of the qualification requirements; and/or (b) record of poor performance such as abandoning the works, not properly completing the contract, inordinate delays in completion, litigation history, or financial failures etc. (c) The qualification criteria shown above are to be considered as standard for normal works." 5. Shri. Bhangde, learned Senior Counsel for the petitioners, vehemently submitted that tender conditions in Clause 3.5 are mandatory, essential eligibility criteria and the bidder, who does not fulfill the requirement of the said conditions, such bider shall be disqualified from the tender process even though such bidder was otherwise qualified as per Clause Nos.3, 3.2 and 3.3 of tender document. It was contended that, in the instant case, respondent No.4 has a past record of poor performance of works, such as abandoning of work, not properly completing the contract, inordinate delays in completion of work under contract and therefore, in view of condition No.3.5(b) of the tender document, respondent No.4 was disqualified from participating in the tender process. Consequently, question of considering the bid of respondent No.4 by the respondent western Coal Fields Limited did not arise. 6. Shri. Bhangde, learned Senior Counsel for the petitioners, vehemently argued that respondent No.4 is a habitual defaulter in completing the work of Western Coal Fields Limited, which is evident from the following facts - i) Respondent No.4 was awarded a contract pursuant to the tender notice dated 16-2000 for hiring of pay loaders and tippers for carrying coal from Pimpalgaon OC mines stock to Pimpalgaon CHP in Wani North area and unloading into CHP bunker worth Rs.56, 77,150/ -. Similarly, respondent No.4 was also awarded contract pursuant to the said tender notice for hiring of pay loaders and tippers for carrying coal from CHP of Pimp alga on to Wani Railway siding and unloading the same Rs.3, 12,24,000/ - However, respondent No.4 transported only 4.33 lakhs Metric tonnes of quantify for job No.1 (Pimpalgaon) and 6.52 lakhs Metric tonnes of quantity for job No.2 as against quantity of 8.50 lakhs metric tonnes. It was further contended that respondent No.4 did not complete the contract. Hence, respondent Western Coal Fields Ltd. had t6 issue short tender notice on 17-9-2001 to complete the said work and Mrs. R. K. Enterprise, Civil Lines, Chandrapur completed the same. Shri. Bhangde, learned Senior counsel, further contended that respondent No.4 was awarded work of transportation of coal from Umred to Umred CHP and the quantity of coal required to be transported under the contract was 18.00 lakhs M.T. during the contract period i.e. from 1-11-2001 to 30-11-2002 whereas respondent No.4 had transported only 8.42 lakhs M.T. even though the period of contract was extended up to 31-1-2003. It was submitted that respondent No.4 has a long record of abandoning and not completing the work awarded to him in the past by the respondent W.C.L. and therefore, incurred disqualification under Clause 3.5(b) and this tender ought to have been rejected on his count. 7. The learned Senior counsel for the petitioners further contended that the petitioners have submitted objection dated 18-7-2006 to the Chief General Manager, Western Coal Fields Ltd., whereby it was brought to the notice of the respondents-authorities that as per condition 3.5 of the tender document, any bidder/bidders even though was/were otherwise qualified as per clause 3.3 and 3.4 of the tender document, however, their tender/tenders would be subject to disqualification, if they have record of poor performance such as abandoning the work, not properly completing the work, inordinate delays in completion etc. The petitioners in the said objection also mentioned that the transport Contractors, who have abandoned the job, should be disqualified. The petitioners in the said objection also mentioned that the transport Contractors, who have abandoned the job, should be disqualified. It was submitted that for considering the objection raised by the petitioners, the respondent Western Coalfields Limited convened a meeting of Tender Committee on 20-7-2006, however, failed to consider eligibility of respondent No.4 in the light of essential conditions of eligibility stipulated in Clause 3.5 of the tender document only because petitioners failed to raise the said objection immediately on the opening of V-I (Envelope I) and the objection was raised after five days of opening of price bid. The learned Senior Counsel further contended that in fact it was not necessary for the petitioners to raise any objection. The respondent Western Coalfields Limited on its own was required to consider each and every tender as per mandatory requirement of condition No.3.5 and so far as tender of respondent No.4 is concerned, ought to have disqualified the same on the ground of poor performance of work in the past, such as abandonment of work at Ukni Mines, Umred and Pimpalgaon. However, respondent Western Coalfields Limited has conveniently taken a stand that the conditions stipulated in Clause 3.5 are ancillary or subsidiary conditions to the main tender condition mentioned in Clause 3.3 and non-fulfillment thereof by the tenderer does not result in rejection of such tender only to favour respondent No.4 since the fact of past poor performance of work by respondent No.4 was within knowledge of WCL and condition No.3.5 (b), if applied, respondent No.4 would be disqualified. 8. Shri. Bhangde, learned Senior Counsel for the petitioners, contended that the respondent Western Coalfields Limited has not denied the statement made by the petitioners in the petition that the respondent No.4 had abandoned the work in the past, however, tried to justify the conduct of the respondent No.4 on some reason or the other and failed to disqualify the respondent No.4 in view of condition No.3.5(b). It was submitted that action of respondent Western Coalfields Limited in accepting tender of respondent No.4 is not only arbitrary, but same is also unjust and liable to be quashed. 9. The learned Senior Counsel for the petitioners submitted that conditions of tender contained in Clause 3.5 are mandatory and essential. It was submitted that action of respondent Western Coalfields Limited in accepting tender of respondent No.4 is not only arbitrary, but same is also unjust and liable to be quashed. 9. The learned Senior Counsel for the petitioners submitted that conditions of tender contained in Clause 3.5 are mandatory and essential. Hence, it was obligatory on the part of the Tender Committee to consider the bid for allotment of work order only of such bidder, who was not disqualified as per essential conditions stipulated in Clause 3.5 even though such bidder was eligible in view of conditions stipulated in Clause 3.3 It was contended that respondent No.4, because of poor past performance of work, had incurred disqualification in view of essential condition stipulated in Clause 3.5(b) and, therefore, the Tender Committee could not legally approve the bid of respondent No.4. 10. Shri. Bhangde, learned Senior counsel for the petitioners, submitted that the petitioners have not suppressed any material facts nor misled the Court in order to obtain any ex parte interim order against respondents in the present writ petition. According to learned senior counsel, even if there is some unintended misstatement of facts due to oversight made in para (9) of the petition, that should not result in dismissal of the petition particularly when the petitioners have not obtained any ex parte interim order against the respondents. 11. Shri. Mehadia, learned Senior Counsel for the respondent Nos.1 to 3, submitted that grievance made by the petitioners is misconceived and based on misreading of tender conditions. It was contended that in response to the tender notice dated 2-5-2006, in all five tenders were received by the respondent Nos.1 to 3. Part-I of the tender i.e. qualifying bid was opened on 2-6-2006. After scrutiny of tender documents, it was noticed that respondent No.4 was qualified. The petitioners and other tenderers were duly informed aboutopenil1g of price bid at 4.00 p.m. on 13-7-2006. On 13-7-2006, the respondents along with other qualified tenderers were present at the time of opening of price bid and the price bid was opened in presence of respondent No.4. After scrutiny of tender documents, it was noticed that respondent No.4 was qualified. The petitioners and other tenderers were duly informed aboutopenil1g of price bid at 4.00 p.m. on 13-7-2006. On 13-7-2006, the respondents along with other qualified tenderers were present at the time of opening of price bid and the price bid was opened in presence of respondent No.4. It was contended that the time of opening of price bid, no' objections were raised by the petitioners regarding works undertaken by the respondent No.4 in the past with the respondent Nos.1 to 3, however, objection in this regard was taken by the petitioners only after knowing the fact that respondent No.4 is the lowest tenderer. It was submitted that the rates quoted by tenderers except respondent No.4 are inclusive of service tax (which is about Rs.30 lakhs). 12. Learned Counsel Shri. Mehadia further contended that bare perusal of Clause 3 of tender documents shows that the bidder must fulfill the criteria laid down in Clause 3.3 to be qualified for award of the contract. It is not disputed that the petitioners as well as respondent No.4 and other two bidders were qualified in accordance with Clause 3.3. 13. Learned Counsel Shri. Mehadia further contended that conditions mentioned in Clause 3.5 are ancillary or subsidiary conditions and are not the main eligibility criteria. It was contended that essential conditions of eligibility are stipulated in Clause 3.3 and conditions stipulated in Clause 3.5 of tender documents are merely ancillary or subsidiary to the main conditions stipulated in Clause 3.3 and therefore, even if it is presumed for the sake of argument that disqualification, if any, is incurred by a bidder in view of the said conditions, however, that by itself does not render such tender disqualified. It was contended that the objection dated 18-7-2006 as well as another objection raised vide telegram dated 24-7-2006 by the petitioners were totally vague and of general nature. It was contended that in objection dated 24-7-2006 as well as in para (8) of the petition, a solitary instance of abandonment of work by respondent No.4 at Ukni is mentioned. It was contended that the said contract is yet to be closed and answering respondents are yet to take permissible legal action against respondent No.4, if necessary. It was contended that in objection dated 24-7-2006 as well as in para (8) of the petition, a solitary instance of abandonment of work by respondent No.4 at Ukni is mentioned. It was contended that the said contract is yet to be closed and answering respondents are yet to take permissible legal action against respondent No.4, if necessary. It was submitted that the conduct of the bidder was required to be seen in totality with an object to get the work executed in most reasonable price. In the present case, the offer of respondent No.4 is lowest and the respondent No.4 being otherwise qualified and eligible in view of Clause 3.3 is considered for grant of allotment of work under tender in the public interest. 14. Shri. Mehadia, learned Counsel, submitted that so far as the objection of the petitioners in respect of abandonment of work by respondent No.4 at Pimpalgaon is concerned, the said objection is misconceived in view of the completion Certificate dated 27-9-2003 issued by respondent- WCL in favour of the respondent No.4 in respect of the said work. It is mentioned in the said Certificate that respondent No.4 has completed the said work to the satisfaction of the Management. Similarly, another objection raised by the petitioners about abandonment/non-completion of work by respondent No.4 in respect of Umred is also misconceived since the respondent-WCL has also issued certificate of completion in respect of the said work, which is annexed with the reply of respondents No.1 to 3, wherein it is mentioned that respondent No.4 has satisfactorily completed the said work. Learned Counsel Shri. Mehadia submitted that so far as objection raised by the petitioners in respect of work at Gondegaon is concerned, respondent No.4 was permitted to carry out the work under the relevant contract, in view of interim order passed by this Court in Writ Petition No.5063 of 2003 filed by respondent No.4 and after dismissal of the petition, respondent No.4 could not carry out the work under contract, which will not amount to abandonment of work. 15. Shri. Mehadia, learned Counsel for the respondent Nos.1 to 3, contended that the Tender Committee in the meeting held on 20-7-2006 considered the entitlement and eligibility of all four qualified bidders including respondent No.4 and their quality of performance in respect of works done by them in the past. 15. Shri. Mehadia, learned Counsel for the respondent Nos.1 to 3, contended that the Tender Committee in the meeting held on 20-7-2006 considered the entitlement and eligibility of all four qualified bidders including respondent No.4 and their quality of performance in respect of works done by them in the past. The Tender Committee has also considered the rates received from all four tenderers, which are competitive as well as reasonable and since the bid of respondent No.4 was lowest, the Tender Committee thought it fit to recommend the offer of respondent No.4 for finalizing the contract under tender. It was, therefore, contended that the procedure undertaken by respondent- WCL is consistent with the conditions of tender and the decision taken by the Tender Committee in recommending the offer of respondent No.4 for finalizing the contract is just and proper and sustainable-in-law. 16. Shri. Manohar, learned Senior Counsel for the respondent No.4, raised a preliminary objection and contended that the petitioners in para (9) of the petition have stated that they were not given any information as to opening of 2nd part of the bid and they came to know about the same at a later point of time and as soon as they came to know about the same, they submitted their objection dated 18-7-2006 to respondent No.2. The learned Senior Counsel vehemently contended that petitioners/ representatives of the petitioners were present at the time of opening of 2nd bid on 13-7-2006. The notice regarding opening of 2nd bid was issued to all the bidders accordingly. All the qualified bidders were present including the petitioners on 13-7-2006 which is also evident from the tender document dated 13-7-2006, which is signed by the petitioners. Learned Senior Counsel Shri. Manohar, therefore, contended that the petitioners have made a false statement in para (9) of the petition and suppressed the material facts that they were present at the time of opening of 2nd bid on 13-7-2006 and misled the Court and therefore, the present writ petition needs to be dismissed on the ground of suppression of material facts and in view of the false statement made by the petitioners in para (9) of the petition. In order to substantiate his contentions; reliance is placed on the judgments in The King V s. The General Commissioners for the purposes of the Income Tax Acts for the District of Kensington (1917 King's Bench Division 486); S. H. Motor Transport Co. Vs. Motilal and Others, (A.I.R. 1965 Bombay 24) and Pawan Kumar Vs. State of Haryana and another (1994(5) SLR 73). 17. Shri. Manohar, learned Senior Counsel, submitted that the conditions stipulated in Clause 3.3 of the tender documents are only essential eligibility criteria and the conditions stipulated in clause 3.5 are ancillary and subsidiary conditions. It was contended that non-fulfillment of essential eligibility criteria undoubtedly disqualifies the bidder. However, non-fulfillment of condition, which is ancillary or subsidiary in nature, does not by itself disqualify the tenderer, though in the present case, respondent No.4 has not incurred any disqualification in view of Clause 3.5(b), either on account of abandonment or non-completion of work in the past. It was submitted by the learned Senior Counsel that in view of the completion certificate issued by respondent WCL in respect of the work at Pimpalgaon and Umred as well as for want of decision by respondent-WCL about the abandonment of work by respondent No.4 in respect of work at Ukni Mines, it was impermissible for the respondent WCL to hold that the respondent No.4 had abandoned the work and incurred disqualification. It was further submitted that the discontinuation of work by respondent No.4 at Gondegaon mines was due to dismissal of the Writ Petition No.5063 of 2003 and therefore, the work which was carried out by respondent No.4 in view of the interim order, could not be carried out after the dismissal of the said writ petition and therefore, this conduct would not amount to either abandonment of work or not completing the work. 18. Shri. Manohar, learned Senior Counsel, vehemently argued that the Tender Committee in its meeting dated 20-7-2006 considered the past performance of contract work of all qualified bidders and it is only thereafter found that respondent No.4 did not incur any disqualification in view of Clause 3.5(b) and his offer being lowest, he was recommended for finalization of the contract. 18. Shri. Manohar, learned Senior Counsel, vehemently argued that the Tender Committee in its meeting dated 20-7-2006 considered the past performance of contract work of all qualified bidders and it is only thereafter found that respondent No.4 did not incur any disqualification in view of Clause 3.5(b) and his offer being lowest, he was recommended for finalization of the contract. It was contended that this Court while exercising the power under Article 226 of the Constitution of India, does not have jurisdiction to consider whether the material available on record before the Tender Committee was adequate for the Tender Committee to conclude that respondent No.4 had incurred disqualification or not under Clause 3.5(b). It was contended by the learned Senior Counsel that the objection raised by the petitioners in respect of the past performance of contract work of respondent No.4 at Ukni, Pimpalgaon, Umred and Gondegaon does not amount to either abandonment of work or non-completion of the said work by respondent No.4, as contemplated under Clause 3.5(b), since it is the specific stand of respondent No.4 as well as respondent Nos.1 to 3 that the respondent No.4 has satisfactorily completed the works at Pimpalgaon and Umred and so far as the work at Ukni is concerned decision about abandonment or otherwise has not yet been taken by the respondent-W.C.L. and till such time, it cannot be concluded that the respondent No.4 had either abandoned the work or not completed the same. 19. Shri. Manohar, learned Senior Counsel, further contended that the offer of respondent No.4 is not only the lowest but it is Rs.3,40,81,500/- less than the petitioners and since respondent No.4 is otherwise eligible and qualified as per the terms and conditions of the tender documents, acceptance of offer of respondent No.4 undoubtedly is in public interest and the decision of the Tender Committee, therefore, apart from being sustainable in law also serves the public purpose. 20. We have given anxious thought to the various contentions canvassed by the learned respective counsel, perused the relevant conditions of tender and decisions relied on and cited by the learned Counsel for the parties. In view of above submissions, it will be appropriate to examine the nature of conditions in tender document stipulated in Clauses 3.3 and 3.5. 20. We have given anxious thought to the various contentions canvassed by the learned respective counsel, perused the relevant conditions of tender and decisions relied on and cited by the learned Counsel for the parties. In view of above submissions, it will be appropriate to examine the nature of conditions in tender document stipulated in Clauses 3.3 and 3.5. So far as conditions stipulated in Clause 3.3 are concerned, we have already reproduced the same in the earlier para of the judgment, However, conditions in Clause 3.5 read thus: "3.5 Even though the bidders meet the above qualifying criteria, they are subject to be disqualified if they have: (a) made misleading or false representations in the forms, statements and attachments submitted in proof of the qualification requirements; and/or (b) record of poor performance such as abandoning the works, not properly completing the contract, inordinate delays in completion, litigation history, or financial failures etc. (c) The qualification criteria shown above are to be considered as standard for normal works." It is the stand of the learned Senior Counsel for the petitioners that conditions in Clauses 3.3 and 3.5 are essential eligibility conditions whereas according to learned Counsel for the respondent Nos.1 to 3 and 4, conditions mentioned in Clause 3.3 alone are of mandatory nature being essential eligibility criteria whereas conditions stipulated in Clause 3.5 are ancillary or subsidiary in nature and, therefore, it was open for the Tender Committee not to insist on strict compliance of the conditions in Clause 3.5, for the reasons to be recorded. 21. It is no doubt true that one, who invokes the discretionary jurisdiction of this Court under Article 226 and/or 227 of the constitution of India, must come with clean hands, must not suppress any relevant fact from the court, must refrain from making misleading statement and should not give incorrect information to the Court. It is equally true that when the petitioner, under Article 226 of the Constitution of India, has failed to state the correct facts or has made a false statement with a view to obtain ex parte order, in such situation, this court will be justified in dismissing such writ petition on this count only. However, suppression of facts, which are material or otherwise, will necessarily depend upon the facts and circumstances of each case. However, suppression of facts, which are material or otherwise, will necessarily depend upon the facts and circumstances of each case. There is no quarrel with the proposition laid down in lis regard in the decisions cited by learned Senior Counsel Shri. Manohar, so far as this aspect is concerned. However, in order to ascertain whether facts stated by the petitioner in para (9) the petition amount to false statement or suppression of material facts with a view to mislead the Court for the purpose of obtaining ex parte order, it is necessary for us to consider the text of para (9) of the petition, which reads thus "It is most humbly submitted that, although no information for opening the Part-II of the bid was given to the petitioners, when the petitioners came to know that Part-II of the bid is likely to be opened in respect of respondent No.4, who had made himself liable for disqualification for abandoning the work, the petitioners immediately put their objections to the respondent No.2 by a letter dated 18-7-2006. A copy of the said letter dated 18-7-2006 is annexed as Annexure'C' to this petition." 22. In the instant case, it is not in dispute that the petitioners have not obtained any ex parte interim order. On careful perusal of paragraph (9) of the petition, it would be seen that the only contention raised by the petitioners is that no intimation of opening of Second Part of the bid was given to the petitioners and as soon as petitioners came to know about the same, they raised objection regarding disqualification of respondent No.4 by letter dated 18-7-2006. In these circumstances, although the petitioners/ representatives appeared to have signed the statement of bid, which was opened on 13-72006 and though there appears to be somewhat incorrect statement in para (9) of the petition, however, in the facts and circumstances of the present case, it is difficult for us to conclude that the incorrect statement was made to mislead the Court with a view to obtain ex parte order. In the instant case, the interim orders were passed after hearing both the sides and therefore, this is not the case where misstatement can be treated to be a falsehood or suppression of material facts with a view to mislead the Court and therefore, petition does not deserve to be dismissed on this ground and the preliminary objection raised by learned Senior Counsel Shri. Manohar is rejected in view of facts involved in the present petition. 23. In the present case, conditions in Clause 3.3, in our view, undoubtedly are essential eligibility conditions since only on fulfillment thereof, the bidder becomes qualified for award of contract. It is also not disputed by all the parties to the petition that conditions in Clause 3.3 are the essential conditions of eligibility and petitioners, respondent No.4 as well as other two bidders were qualified for award of work since they fulfill these conditions. 24. The controversy in issue is as to whether the tender conditions stipulated in Clause 3.5 are essential conditions or ancillary, subsidiary and non-essential conditions. The relevant condition is 3.5(b). The plain reading of Clause 3.5(b) shows that bidder, even though is qualified as per conditions in Clause 3.3, would be subject to disqualification, if he has a past record of poor performance of work, such as abandoning the work, not properly completing the contract, inordinate delay in completion of work, litigation, financial failure, etc. In other words, the bidder, who, in past, had abandoned the work under contract or caused inordinate delay in completion of work, etc would be subject to disqualification as per Clause 3.5(b), however, does not get disqualified automatically till such time decision is taken on such subject by the Tender Committee. To be a subject of disqualification and being disqualified though are two different and distinct situations, however, the result is the same, i.e. tenderer gets disqualified. In former, disqualification shall come into effect only after decision is taken on the subject by the Tender Committee, i.e. bidder, who is subject of disqualification has incurred disqualification and is disqualified. In latter, disqualification comes into effect on breach of conditions itself and disqualifies such bidder automatically. In former, disqualification shall come into effect only after decision is taken on the subject by the Tender Committee, i.e. bidder, who is subject of disqualification has incurred disqualification and is disqualified. In latter, disqualification comes into effect on breach of conditions itself and disqualifies such bidder automatically. Clause 3.5 gives right, power and jurisdiction to the Tender Committee to take decision on the subject of disqualification only after following rules of natural justice and it is the decision of the Tender Committee, which will determine whether such bidder has been disqualified. However, having taken such decision by the Tender Committee, such bidder gets disqualified in view of condition 3.5(b). So far as condition 3.5(b) is concerned, record of poor performance or abandonment of work is a matter, which Tender Committee needs to consider while awarding contract in public interest. It is also well settled that Public Authorities while discharging public duty have to act in a transparent manner and their actions must be just, fair and free from arbitrariness as well as favouritism. It is also well settled that essential eligibility conditions are incorporated in the tender document in order to ensure proper implementation and fulfillment of objective of tender. We want to express that whenever conditions of tender require an act to be done in a particular manner and also lay down that failure to comply with the said requirement result in disqualification, such conditions of tender are always treated to be essential conditions of tender. In the case in hand, condition 3.5(b) though gives right, power and discretion to the Tender Committee, to decide question of disqualification, however, that does not render condition 3.5(b) as ancillary or subsidiary, particularly when such decision of the Tender Committee in a given case would result in disqualification of such tenderer. Careful evaluation of condition 3.5(b) shows that it has an overriding effect even on the essential conditions of eligibility stipulated in Clause 3.3 and can disqualify a bidder even though such bidder otherwise fulfills essential eligibility criteria stipulated in Clause 3.3 of the tender document. Careful evaluation of condition 3.5(b) shows that it has an overriding effect even on the essential conditions of eligibility stipulated in Clause 3.3 and can disqualify a bidder even though such bidder otherwise fulfills essential eligibility criteria stipulated in Clause 3.3 of the tender document. It is well established that while construing the terms and conditions of documents of tender, the Courts are required to interpret them on the basis of language used in such terms and conditions, purpose for which such terms and conditions are incorporated as well as objective to be achieved and not on the basis of explanation given by the Authority in the affidavit filed in the Court justifying the action of the Tender Committee. 25. Even otherwise, it will be meaningless to treat the condition, which has an overriding effect even on essential conditions of eligibility, as ancillary or subsidiary and, therefore, by necessary implication, such condition has to be treated to be essential in nature. In the backdrop of these rules of interpretation, if we consider condition 3.5(b), it is implicitly clear that if the past performance of work of the bidder is poor, then such bidder would not achieve the objective for which tender is floated nor can ensure proper implementation of contract, which would result in defeating the public purpose and such bidder would be subject of disqualification and if the Tender Committee after proper consideration, concludes that such bidder has incurred disqualification, in that case, such bidder would get disqualified. Looking to the language used in condition 3.5(b) and purpose and objective to be achieved by the said condition, we have no hesitation to hold that condition 3.5(b) is an essential condition. We, therefore, agree with the contentions advanced by learned Senior Counsel Shri. Bhangde in this regard and reject the contentions of the learned Counsel for the respondents. 26. It is no doubt true that right to choose a bidder as per conditions and procedure stipulated in the tender document is of the Authority/Tender Committee and the Court does not sit in appeal on the decision taken by the Authority in this regard. Nevertheless such decision must be free from arbitrariness and favouritism, must be in the public interest and must be taken by the Tender Committee after proper application of mind. Nevertheless such decision must be free from arbitrariness and favouritism, must be in the public interest and must be taken by the Tender Committee after proper application of mind. The decision taken by the Tender Committee, in view of mandatory condition 3.5(b), therefore, must demonstrate that the Tender Committee has applied its mind to the contingencies mentioned in the said condition and on the basis thereof, has considered performance of work executed by the bidder on the earlier occasion and it must show that it is only thereafter the Tender Committee has concluded the issue of disqualification. If the decision of the Tender Committee is silent on these aspects, such decision, in our view, undoubtedly would be arbitrary, unjust and no amount of explanation given in the affidavit filed on behalf of the Authority can legitimise such decision, which does not show proper application of mind by the Tender Committee as required in view of essential conditions of tender. It is the decision, which must show that same is taken by the Tender Committee after proper application of mind and such inference cannot be drawn on the basis of explanation or justification given by the Authority in the affidavits filed in the Court. 27. In the backdrop of above, let us consider minutes of the meeting of the Tender Committee dated 20-7-2006. On perusal of the minutes, it would be seen that the Tender Committee has treated conditions in Clause 3.5 as merely ancillary or subsidiary only because by their application, most of the working Contractors would have been disqualified. In our considered view, this cannot be a ground for not complying with the essential conditions or to ignore them. We want to mention that while floating tender, it is for the Department/Authority, which floats such tender, to evolve essential conditions of tender as well as ancillary or subsidiary conditions looking to the objective to be achieved under tender. However, having formulated such essential conditions of tender, strict compliance of such conditions is mandatory and it is not open for the Authority to ignore such essential conditions, which, in our view, undoubtedly would affect the public interest and also defeat the objective of tender. 28. It is no doubt true that it would have been proper, if the petitioners would have raised objection on 13-7-2006 when the price bid was opened. 28. It is no doubt true that it would have been proper, if the petitioners would have raised objection on 13-7-2006 when the price bid was opened. However, merely because petitioners raised objection at later point of time, in our opinion, in view of facts and circumstances of the present case, will make no difference vis-a-vis qualification/ disqualification of respondent No.4 insofar as condition 3.5(b) is concerned. The reason given by the Tender Committee that if cognizance of objection of the petitioners is taken, there would be likelihood of disruption in work, is wholly misconceived. In our view, it was incumbent on the Tender Committee to consider past performance of each bidder in terms of Clause 3.5(b) and then record its reasons whether or not the bidder has incurred disqualification. 29. In the case in hand, in our considered view, the minutes of the meeting of the Tender Committee do not show that the Tender Committee has considered past performance of any qualified bidder including respondent No.4 vis-a-vis condition 3.5(b) of the tender, which has resulted in violation of essential conditions of tender and, therefore, decision taken by the Tender Committee to recommend bid of the respondent No.4 for finalizing the contract, in our view, is bad-in-law and liable to be set aside. 30. We are aware of the powers of this Court in respect of judicial review of administrative actions and, therefore, factual aspect though raised by the parties in respect of abandonment of work and non completion of work allotted to respondent No.4 in earlier contracts, it will not be possible for this Court to consider and conclude this issue while exercising writ jurisdiction of this Court and it is for the respondent Nos.1 to 3 to consider the same in the light of Clause 3.5(b) and take appropriate decision on the basis of material available on record after following rules of natural justice. 31. For the reasons stated hereinabove, the decision of the Tender Committee, dated 20-7-2006 recommending bid of respondent No.4 for finalizing the contract is hereby quashed and set aside. 31. For the reasons stated hereinabove, the decision of the Tender Committee, dated 20-7-2006 recommending bid of respondent No.4 for finalizing the contract is hereby quashed and set aside. The matter is remitted back to the Tender Committee for reconsideration of bids of all the four bidders, who are qualified in terms of Clause 3.3, including respondent No.4, as per condition 3.5 in general and 3.5(b) in particular, on the basis of material available on record against each one of them, after following rules of natural justice, within a period of 4 weeks from the date of communication of this judgment, keeping in view the aspect of lowest price bid and proceed according to law. Till such time present arrangement made by this Court vide interim order dated 3-8-2006 shall continue. In case while reconsidering the bids of the qualified bidders by the Tender Committee, as per Clause 3.5(b), all the four bidders get disqualified, in that event, respondent No.2 shall float fresh tender after formulating essential subsidiary terms and conditions, which shall be unambiguous, clear and shall provide such procedure, which is transparent, straight forward and shall serve public purpose. 32. The rule is made absolute in the above terms. No order as to costs. Petition dismissed.