NIRAJ PRATIBHA J. v. VS INDORE DEVELOPMENT AUTHORITY
2008-06-05
SHANTANU KEMKAR
body2008
DigiLaw.ai
Judgment Shantanu Kemkar, J. ( 1. ) Feeling aggrieved by the non consideration of its financial bid the petitioner a Joint Venture Company of Niraj Cement Structural Ltd. and Pratibha Industries Ltd. has filed this petition under article 226 of the Constitution of India seeking direction to the respondent to treat the petitioner qualified in technical bid and to direct the respondent to open its financial bid. ( 2. ) On 15.2.2008, the respondent, an authority constituted under Nagar Tatha Gram Nivesh Adhiniyam, 1973, published a notice inviting tender for construction of Western Ring Road (R.W.2) of 75m. Wide in scheme no. 151 from MR-10 Ujjain Road junction to Airport- Pithampur Road junction as per Bus Rapid Transit System (for short B.R.T.S.) under Jawaharlal Nehru National Urban Renewal Mission (Phase-1). Thereafter the respondent amended the tender amount, amount of earnest money; the date of submission of bid; dates of opening of technical and financial bids. Accordingly, as per amendments, the bid was required to be submitted up to 01.3.2008. Opening of technical bid was on or before 14.3.2008 and opening of financial bid was fixed on 20.3.2008 at 4.00 pm. ( 3. ) The case of the petitioner is that it has submitted its bid on 14.3.2008 with all the necessary documents fulfilling the eligibility criteria required for opening the technical bid. On 19.3.2008 vide annexure P-8.the respondent informed to the petitioner the extension of date of opening of the financial bid from 20.3.2008 to 28.3.2008. Having received this intimation dated 19.3.2008 (Annexure P-8), the petitioner sent its representative to attend the opening of the financial bid on 28.3.2008. However the petitioners financial bid was not opened and its representative was informed by the respondent that since the petitioner did not qualify the eligibility criteria in the technical bid, it has been held disqualified for opening of the financial bid. Being aggrieved by the said act of respondent, petitioner has filed this petition. ( 4. ) The petitioner averred in the petition that a three stage procedure for opening and evaluation of bid has been mentioned at Clause-E of the tender form. Clause 24.1 (a)(b) and (c) on which the petitioner placed reliance reads thus:- 24.Bid Opening. 24.1. xxxx- xxxxx xxxxx A three stage procedure will be adopted in opening and evaluating the proposal. (a) In first stage the envelop of Bid security shall be opened and checked.
Clause 24.1 (a)(b) and (c) on which the petitioner placed reliance reads thus:- 24.Bid Opening. 24.1. xxxx- xxxxx xxxxx A three stage procedure will be adopted in opening and evaluating the proposal. (a) In first stage the envelop of Bid security shall be opened and checked. In case requisite bid security is not found the technical and financial proposal of the bidder shall not be entertained and shall be returned unopened.. (b) In the second stage, the technical proposal shall be opened and eligibility and bid capacity of the firm will be ascertained on the basis of qualification criteria as specified in this document. The financial proposal of only those bidders, who are declared technically qualified, shall be opened. The schedule of opening of the financial proposal shall be intimated to only those bidders who are declared technically qualified, by the Authority. (emphasis supplied). (c) In the third stage, the financial proposal of the bidders who are declared qualified on the basis of technical evaluation shall be invited to be present in order to witness the opening of financial proposal. The financial bids shall be evaluated on the basis of rates quoted by the bidder. ( 5. ) On the strength of underlined portion of sub-clause (b) of Clause 24.1, the petitioner averred that since vide Annexure P-8 the petitioner was intimated by the respondent, the schedule of opening of the financial proposal it is deemed that the petitioner is declared technically qualified. In the circumstances, it was not open for the respondent to say that the petitioner did not qualify in the technical bid. In the premises, it is averred that the action of the respondent in not opening its financial bid is contrary to the terms of the tender conditions. ( 6. ) The respondent in its reply has averred that the technical bids of all the bidders were opened as per the Schedule on 14.3.2008. The technical bids were bulky in volumes; it contained various datas furnished by the bidders. The scrutiny and verification required considerable time and as such it could not be possible for the Tender Evaluation Committee constituted by the respondent to report the result of the scrutiny and as such the date of opening of the financial bid was required to be extended from 20/3/2008 to 28.3.2008.
The scrutiny and verification required considerable time and as such it could not be possible for the Tender Evaluation Committee constituted by the respondent to report the result of the scrutiny and as such the date of opening of the financial bid was required to be extended from 20/3/2008 to 28.3.2008. Thus, due to non receipt of the recommendation from the Tender Evaluation Committee, all the bidders were informed the extended date of opening of the financial bid from 20.3,08 to 28.3.2008. It is stated that the letters issued by the respondent intimating the extension of date of opening of financial bid which were sent to all the bidders who submitted their bids will not give any right to the petitioner so as to contend that by receipt of such letter, it qualified technically and became eligible for opening of its financial bid. It is further stated that on opening of the petitioners technical bid, it was found that the petitioner did not fulfill the eligibility criteria as per clause-3 of the tender conditions. The respondent, placed on record the decision of the Tender Evaluation committee as Annexure R-10 spelling out the reasons for rejection of the petitioners technical bid. According to the respondent, for better and enhanced connectivity and for rapid movement of the traffic, the construction of RW-2 as per the norms of B.R.T.S. is to be completed in schedule time. In order to award the contract of such a prestigious nature the respondent is duty bound to ascertain that only the competent bidder may be awarded the contract. In order to award this important and prestigious award, following eligibility criteria was prescribed in the tender document. 3. Eligibility criteria 3.1 Eligibility criteria for sole applicant firm or lead partner in case of JV shall be as under:- (1) Minimum experience of successful completion of four/six laning of Highways (NH/SH/Equivalent); Firm should have successfully completed similar job of at least one single highway project of four/six laning costing at least 50 crore and should have executed work amounting 40crore in one single year fro any completed work in same name and capacity last five years under one single work order ( certificate issued by Principal Employer (Central Govt./Local Bodies only) should be submitted alongwith Technical Bid).
OR Minimum experience of successful completion of civil infrastructure project: Firm should have successfully completed at least on single civil infrastructure project (i.e. Roadwork/Bridge work) of 100 crore and should have executed work amounting 40 crore in one single year for any completed work in same name and capacity in last five years under one single work order ( certificate issued by Principal Employer (Central Govt./ State Govt/ Local Bodies only) should be submitted along with Technical Bid). In support of above the bidder should enclose not more than 5 relevant certificates. (ii) Annual average turnover: Minimum Average Annual construction turnover of the firm as per the audited balance sheet for the immediate last five years should be equivalent to the 50% (fifty percent) of cost of the project. Note: (a) The experience should be as on the date of submission of bid document. (b) This successful completion certificate should be clearly marked separately in the Technical Proposal. (c ) The financial year means year starting from 1st April to 31 st March of next year. (iii) MINIMUM NETWORTH of the bidder should be minimum 10% of the probable amount of the contract as mentioned in Para 1 of the invitation for bid. Note. The bidders are requested to enclose only requisite and relevant data in prescribed format shall be considered only. Information in other format shall be liable for rejection. 3.2 In case of JV, lead partner must fulfill all of above requirements and other JV partner should fulfill minimum 50% of above mentioned criteria fixed for lead partner for Experience, Average Annual Turnover and Net worth ( as mentioned in clause 3.1 (i), (ii) and (iii) above). OR JV partner should fulfill minimum 75% of above mentioned criteria fixed for lead partner for Average Annual Turnover and Net worth. Joint Venture shall not have more than two firms. 3.2 (i) A Bidder shall not have a conflict of interest. All Bidders found to be in conflict of interest shall be disqualified.
OR JV partner should fulfill minimum 75% of above mentioned criteria fixed for lead partner for Average Annual Turnover and Net worth. Joint Venture shall not have more than two firms. 3.2 (i) A Bidder shall not have a conflict of interest. All Bidders found to be in conflict of interest shall be disqualified. A Bidder may be considered to have a conflict of interest with one or more parties in the bidding process, if they; a) Have controlling share holder in common; or b) Receive or have received any direct or indirect subsidy from any of the them; or c) Have the same legal representative for purposes of this Bid; or d) Have a relationship with each other directly or through common third parties that put them in a position to have access to information about or influence on the Bid of another bidder, or influence the decision of the Authority regarding the Bidding process. 3.2(ii) Government owned enterprises shall be eligible only if they can establish that they are legally and financially autonomous and operate under commercial law and that they are not a dependent agency of the Authority. 3.2 (iii) In case of Joint venture, the firm, which has submitted experience certificates to meet the Eligibility requirements, will act as the lead firm representing the Joint Venture. The duties, Responsibilities, and powers of such lead firm shall be specifically included in the MOU/agreement. It is expected that the lead partner would be authorized to incur liabilities and to receive instructions and payments for and on behalf of the Joint Venture. For a JV to be eligible for bidding, the experience of lead partner and other partner should be an indicated in date sheet. 3.2 (iv) A firm can bid for project either as a sole bidder or in the form of joint venture with other construction firms. However, alternative proposals i.e. one as sole or in JV with other contractor and another in association/JV with any other contractor for the same package will be summarily rejected. In such cases, all the involved proposals shall be rejected. 3.2(v) Bidder should submit information in relevant forms. 3.3. Available Bid Capacity The available bid capacity of the bidders shall be assessed at the time of Technical evaluation.
In such cases, all the involved proposals shall be rejected. 3.2(v) Bidder should submit information in relevant forms. 3.3. Available Bid Capacity The available bid capacity of the bidders shall be assessed at the time of Technical evaluation. The bidders to be eligible for award of work shall have the bidding capacity more than the total estimated cost of the works as indicated in the bid document. The available bid capacity will be calculated as under: Assessed Available Bid Capacity (A* N*2-B), where A. Maximum value of construction turnover in civil engineering works executed in any one year during the last five years (updated to price level of the year in which contract is to be awarded). B. Value of balance works of existing contract commitments. ( for next two years) N. Number of years prescribed for the present contract. ( Period upto 6 months to be taken as half year and more than 6 months and up to 12 months as one year) Note: 1. Certificate duly signed or counter signed by the Engineer-in-charge should be submitted in support of the above. 2. Contractor should submit the bid capacity assessment format ( Form Exp-2,4) duly filled and signed by him. 3.4 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 arid attachments submitted in proof of the qualification documents; 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; and /or c) Participated in the bidding for the other work and had quoted unreasonably high bid prices/low bid prices and could not furnish rational justification to the authority. ( 7. ) It is further stated by the respondent in its reply that the audited balance sheets of five financial years of the petitioners lead partner did not tally with the balance sheets furnished by the same lead partner in its previous bid submitted for awarding of contract to the respondent for MR-9. The balance sheet of 2006-07 submitted by the lead partner and audited by Ajay B. Garg, a chartered Accountant and the balance sheet of the same year audited by another Chartered Accountant CN Shanbag and Company were showing different figures.
The balance sheet of 2006-07 submitted by the lead partner and audited by Ajay B. Garg, a chartered Accountant and the balance sheet of the same year audited by another Chartered Accountant CN Shanbag and Company were showing different figures. It is further averred that the petitioner did not satisfy the eligibility criteria in respect of experience. The lead partner claimed experience of widening of 4/6 lanes and strengthening of existing 2 lane carriage way of National Highway-60 in the State of Orissa . The said contract was not awarded to the lead partner but was awarded to Larsen and Turbo Ltd. (for short LandT) by National Highway Authority of India Ltd. (for short NHAI).. The lead partner was awarded sub contract by the LandT of the portion of the work allotted to it by the NHAI. Thus the lead partner executed part of the work as sub contractor and for this reason the petitioner did not satisfy the experience criteria of the tender document. It is also stated that the petitioners lead partner and the other partner did not disclose all the works in hand and have disclosed only the works allotted to it by the respondent. In the circumstances, the petitioners bid capacity could not be assessed. The respondent also averred the unsatisfactory performance of the lead partner and the other partner in the work allotted to them by the respondent as also by the Indore Municipal Corporation. ( 8. ) A Rejoinder and an affidavit have been filed by the petitioner explaining the circumstances under which the other work allotted by the respondent to the lead partner could not be completed in speedy way. In regard to the experience claimed, it is stated that in the tender document there is no bar of claiming experience as sub contractor, therefore, it is argued that rejection of the petitioners bid on this count amounts to change in the tender condition which is impressible. The petitioner placed reliance on the judgment of the Supreme Court passed in the case of Monarch Infrastructures (P) Ltd. Vs. Commissioner Ulhasnagar Munnicipal Corporation and others (2005) 5 SCC 287.
The petitioner placed reliance on the judgment of the Supreme Court passed in the case of Monarch Infrastructures (P) Ltd. Vs. Commissioner Ulhasnagar Munnicipal Corporation and others (2005) 5 SCC 287. So for as the alleged discrepancies of the financial statements of the year 2006-07 it is stated that the report of G. N. Shanbag and Company Chartered Accountant was submitted for the previous bid on or before 22.6.2007 which was not finally audited report as by that date the statutory period of getting the financial record audited was not complete. It is further averred that the lead partner was not having any incomplete work except shown in Form No.IV on 14.3.2008, the date of submission of bid. There was no suppression or misrepresentation on the part of the petitioner in regard to the works in hand. As regards the other partner, the datas of the lead partner only are relevant for assessment of the bid capacity as per the tender condition, therefore, there is no question of disclosure of other works except shown in Form TV by the other partner. It is further stated that in the letter dated 19 3.2008, the respondent, has nowhere mentioned that the technical bids have not been scrutinized and therefore the petitioners financial bid ought to have been opened. ( 9. ) In reply to the Rejoinder, the respondent has stated that all the bidders including the petitioner were informed on 19.3.2008 about the extended date of opening of the financial bid. In support the postal receipts have been filed to demonstrate that all the bidders were informed about extension of the date of opening of the financial bid. ( 10. ) 1 have heard learned senior counsel for both the parties and also.gone through the pleadings and the documents filed by them. ( 11. ) There cannot be a dispute that the project in question of which the tenders were invited, is a time bound and huge money involved project. In order to get the work under the project performed within the stipulated period, the bids were invited by the respondent with the aforesaid conditions in regard to eligibility including experience bid capacity of the bidder etc.. It is revealed from the decision of the tender evaluation committee the petitioner was adjudged disqualified in the technical bid on various counts.
In order to get the work under the project performed within the stipulated period, the bids were invited by the respondent with the aforesaid conditions in regard to eligibility including experience bid capacity of the bidder etc.. It is revealed from the decision of the tender evaluation committee the petitioner was adjudged disqualified in the technical bid on various counts. Before dealing with the grounds of rejection of the petitioners bid, it would be appropriate to deal with the first ground raised by the petitioner based on clause 24.1(b) and (c) of the tender document. From the amendment in the dates of the submission and opening of the technical and financial bids, it is clear that the opening of the technical bid was scheduled on 14.3.2008 and the opening of the financial bid was scheduled on 20.3.2008. The technical bids were opened on 14.3.2008 as per schedule. Having regard, to the nature and volume of the documents required to be submitted and submitted by all the bidders alongwith the technical bid, the contention of the respondent that the scrutiny and verification process of the documents submitted alongwith the technical bids could not be completed and in the circumstances all the bidders were informed on 19.3.2008, the extended date for opening the financial bid appears to be fully justified. On the basis of such letter by which the bidders were informed the extended date of opening of the financial bid in which there is no declaration that the petitioner is technically qualified, the petitioner who is otherwise disqualified in the technical bid can not claim any right to be declared qualified in the technical bid and seek consideration of its financial bid. In the letter Annexure P-8, it is nowhere mentioned that the petitioner is declared technically qualified. In this view of the matter the petitioners contention that having received intimation about extension of the date of opening of financial bid, it became eligible for opening of its financial bid is wholly misconceived and cannot be accepted. ( 12. ) On going through the reasons assigned by the Tender Evaluation Committee it is1 revealed that one of the grounds for holding the petitioner to be disqualified in the technical bid is that the petitioner has failed to fulfill the requirement of minimum experience prescribed by the respondent.
( 12. ) On going through the reasons assigned by the Tender Evaluation Committee it is1 revealed that one of the grounds for holding the petitioner to be disqualified in the technical bid is that the petitioner has failed to fulfill the requirement of minimum experience prescribed by the respondent. The petitioner claimed experience on the basis of work done by its lead partner as sub contractor of LandT which was awarded contract by NHAL A perusal of Form Ex.P.2.1 in regard to general construction experience and from the perusal of the certificate issued by L and T. filed by the petitioner, it is clear that petitioner did only part of the single work order which was issued by the NHAI in favour of LandT and did not perform the entire work. The main contract was between the NHAI and LandT. and the LandT which was assigned the contract in its turn sub contracted part of its work to the lead partner of the petitioner. Thus, the petitioner was rightly held to be not fulfilling the criteria of having minimum experience as fixed in the aforesaid clause of the tender document. The contention of the petitioner that in the tender document it was not mentioned that the work experience as sub-contractor will not be accepted, has no force. The condition no. 3.1 (i) of Eligibility Criteria is very clear and according to which minimum experience of successful completion of four/six laning of highways (NH/SH/equivalent) and the Firm should have successfully completed similar job or at least one single highway project of four/six laning costing at least 50 crore and should have executed work amounting to 40 crore in one single year of any completed work in same name and capacity last five years under one single work order ( Certificate issued by Principal employer (Central Govt/Local bodies only) should be submitted alongwith technical bid. ( emphasis supplied). In the light of this condition there is no scope for the petitioner to contend that the work done by it as sub contractor through the contractor of the Principal employer NHAI deserves to be considered as fulfillment of the requirements of experience.
( emphasis supplied). In the light of this condition there is no scope for the petitioner to contend that the work done by it as sub contractor through the contractor of the Principal employer NHAI deserves to be considered as fulfillment of the requirements of experience. The condition about the experience has to be interpreted in the manner it has been incorporated in the tender document any deviation of it so as to include the sub contractor also would be adding something which is not in the condition. When the condition is clear, there is no scope of interpretation of it in the way the petitioner suggests which would dilute the condition of experience of the bidder. The requirement of submission of certificate issued by Principal employer (Central Govt./ local bodies only) makes the condition clear that the bidder has to be the contractor and not a sub contractor of the contractor of the Principal employer. The nature of the duties and responsibilities of the sub contractor of the contractor of the Principal employer and the duties and responsibilities of the contractor of the Principal employer cannot be equated. In this view of the matter when there is no provision for allowing a sub-contractor to claim experience as such, the contention of the petitioner that by rejecting its experience as a sub contractor, there is change in the tender condition is wholly misconceived and cannot be accepted. Thus the judgment of the Supreme Court in the case of Monarch Infrastructures (P) Ltd. ( supra) has no application to the facts of this case. ( 13. ) Although the Tender Evaluation Committee has disqualified the petitioner on other grounds also, which have been refuted and tried to be explained by the petitioner, however, as I am in agreement of the decision of the Tender Evaluation Committee of the respondent in respect of the non fulfillment of the experience criteria by the lead partner of the petitioner, I do not feel it necessary to deal with those grounds as the question to deal those grounds would have arisen only if the petitioner had been held to be qualified in criteria about having minimum experience. ( 14. ) Thus in my considered view the decision of the respondent not to pen the petitioners financial bid needs no interference in this writ petition filed under article 226 of the Constitution of India.
( 14. ) Thus in my considered view the decision of the respondent not to pen the petitioners financial bid needs no interference in this writ petition filed under article 226 of the Constitution of India. It is now well settled that unless the decision is arbitrary, unfair, or based upon malafides, the court will not interfere in the decision taken in such commercial matters relating to award of the contracts. ( 15. ) Having held so, I have no option but to dismiss this petition. Accordingly the petition is dismissed, however, with no orders as to costs. Petition dismissed.