Sagar Enterprise v. Hindustan Paper Corporation Ltd.
2009-03-16
BIPLAB KUMAR SHARMA
body2009
DigiLaw.ai
JUDGMENT B.K. Sharma, J. 1. By means of this writ petition, the petitioner has prayed for a direction to the respondents to grant extension in respect of the contractual period in question and to set aside and quash the particular Notice Inviting Tender (NIT). 2. The petitioner is a proprietorship firm. In response to Annexure-4 NIT dated 24.6.2006 (Annexure-4 to the writ petition) inviting sealed and superscribed tender in two bid system for disposal of waste material on "as is where is" basis", the petitioner responded to the same by submitting its tender. The item in question is "Screw Press Rejects" and quantity was indicated as 20,000 Metric Tone (NT). 3. The petitioner became the successful bidder as he quoted the rate of Rs.38.48/MT. Accordingly, the petitioner was awarded with the contract by order dated 6.10.2006 (Annexure-5 to the writ petition). It was indicated in the order that the disposal order would remain valid upto 31.10.2008 subject to extension of another one year depending upon satisfactory performance. 4. Pursuant to the aforesaid work order, the petitioner started lifting "Screw Press Rejects" from the premises of the respondent-Corporation. It is the case of the petitioner that it was his expectation that he would get the extension for a period of one year as stipulated in Annexure-5 work order dated 6.10.2006. The petitioner by his Annexures-9, 10 and 11 representations dated 16.8.2008, 22.8.2008 and 29.8.2008 made request to the respondent-Corporation to grant the extension of the period of contract by another one year from 1.11.2008 to 31.10.2009. 5. It is the case of the petitioner that in view of the aforesaid stipulation made in Annexure-5 work order, it is entitled to get such extension of one year. By Annexure-12 letter dated 30.10.2008, the petitioner was advised to continue the lifting of "Screw Press Rejects" until further instruction and the petitioner continued to lift the same beyond the stipulated period, i.e., 31.10.2008. In the meantime, the authority by its Annexure-13 letter dated 19.11.2008 informed the petitioner that the term of the work order has been extended for a further period of 3 (three) months till 31.1.2009. In the letter, it was also indicated that the contract might be short closed depending on the finalization of the new contract. 6.
In the meantime, the authority by its Annexure-13 letter dated 19.11.2008 informed the petitioner that the term of the work order has been extended for a further period of 3 (three) months till 31.1.2009. In the letter, it was also indicated that the contract might be short closed depending on the finalization of the new contract. 6. After the aforesaid developments, the respondent-Corporation issued Annexure-14 NIT dated 15.11.2008 for lifting of the Screw Press Rejects to the tune of Rs.5,520/MT mentioning the period of contract as one year. The petitioner is aggrieved by such issuance of fresh NIT as according to the petitioner, it is entitled to get the extension in terms of the work order dated 6.10.2006 (Annexure-5 to the writ petition). 7. The respondents in their counter affidavit have denied the contentions raised in the writ petition to which the petitioner has filed rejoinder affidavit. In the counter affidavit, it is the stand of the respondent-Corporation that the petitioner cannot claim extension of the term of the contract as a matter of right. According to the respondents, it took a conscious decision to float fresh NIT in view of the fact that the price of the Screw Press Rejects has abnormally increased and that the period of contract with the petitioner has come to an end. The matter relating to issuance of fresh tender in view of the changed circumstances was discussed at different levels and eventually, a conscious decision was taken to go for fresh tender. In Paragraph 17 of the counter affidavit, the respondents have given particulars of 8 parties, who participated in the fresh tender process and their quoted prices have also been indicated. For a ready reference, the paragraph is quoted below: 17. That with regard to paragraphs 18, 19, 20, 21, 22, 23, 24, 25, 26 and 27 the answering respondent states that in pursuant of the NIT published on 15.11.2008, altogether eight parties participated in the tender and their technical bids were opened on 5.12.2008 and thereafter price bids were opened. The particulars of the eight parties who participated in the tender process and their quoted price are produced herein below: Sl. No. Name if the party Rate quoted Per MT (in Rupees) Remarks 1. M/s. SS Enterprise 3,210 VAT inclusive 2. M/s. Jalan Impex 616 Taxes extra 3. M/s. Saraogi Paper Mill (P.) Ltd. 529 Taxes extra 4.
The particulars of the eight parties who participated in the tender process and their quoted price are produced herein below: Sl. No. Name if the party Rate quoted Per MT (in Rupees) Remarks 1. M/s. SS Enterprise 3,210 VAT inclusive 2. M/s. Jalan Impex 616 Taxes extra 3. M/s. Saraogi Paper Mill (P.) Ltd. 529 Taxes extra 4. M/s. DNA Agrotech (P.) Ltd. 866 Taxes extra 5. M/s. S.P. Traders 1,450 Taxes extra 6. M/s. Star Paper & Board Mill 207 Taxes extra 7. Md. Younus Ali 419.51 Taxes extra 8. M/s. Assam Paper Mill (P.) Ltd. 266 Taxes extra The allegation of the writ petitioner that the NIT has been floated to favour some private contractors is absolutely without any basis. It is stated with respect that a fresh tender has been floated on the expiry of the contract of the writ petitioner and therefore, no violation of fundamental rights or any legal rights can be alleged against the respondent corporation. It is also stated with respect that the writ petitioner has no right to continue beyond the period of contract, i.e., beyond 2 years. Therefore, the present writ petition is not maintainable under Article 226 of the Constitution of India, as the writ petitioner has failed to establish any violation of any fundamental and/or other constitutional rights. Moreover, there is no balance of convenience and/or prima facie case in favour of the writ petitioner. Under these circumstances the NIT dated 12.11.2008 published on 15.11.2008 is not liable to be interfered with. 8. It will be pertinent to mention here that the rate, at which the contract has been awarded to the petitioner is Rs.38.48/MT and compared to that price, the price which the respondent-Corporation is presently getting, is much more higher. In fact, in paragraph 18 of the counter affidavit, the respondent-Corporation, upon a reference to the interim order passed in this proceeding dated 5.11.2008, by which it was provided that while the fresh tender process would continue but no final order should be passed, has stated that the respondent-Corporation has finalized the tender in favour of the highest bidder but in terms of the said interim order, has not issued final work order. Thus, as against the present rate of the petitioner, which is Rs.38.48/MT, the respondent-Corporation is getting the price of Rs.3,210/MT which is the highest bid as per the aforesaid quoted price of different parties.
Thus, as against the present rate of the petitioner, which is Rs.38.48/MT, the respondent-Corporation is getting the price of Rs.3,210/MT which is the highest bid as per the aforesaid quoted price of different parties. 9. Mr. K.N. Choudhury, learned senior Counsel assisted by Mr. R. Dubey and Mr. S. Shyam, learned Counsel for the petitioner strenuously argued that in view of the specified term in the work order, the petitioner is entitled to get the extension of working period. He submitted that the respondents have acted unfairly in not granting extension to the petitioner. On being asked as to whether the petitioner is ready to offer any higher bid, Mr. Choudhury, learned Counsel for the petitioner submitted that the petitioner is ready to offer the rate of Rs.320/MT and not beyond that. Be it stated here that the petitioner has not participated in the new tender process. 10. Mr. A.K. Goswami, learned senior Counsel assisted by Mr. J. Roy, learned Counsel for the respondent-Corporation submitted that apart from the fact that the petitioner cannot claim extension of the period of contract as a matter of course, the respondent-Corporation having received better price, which is not even comparable with the present price, which the Corporation is getting from the petitioner, has done nothing wrong in taking the decision to go for a fresh tender. Referring to the stand in the counter affidavit, he submitted that since the price of the materials, in the meantime, rose abnormally, the respondent-Corporation cannot grant extension to the petitioner at the cost of revenue of the Corporation. As regards the particular stipulation in the work order, his submission is that the expression "satisfactory performance" will not only mean the satisfactory performance of the petitioner, but all round satisfactory performance of the contract itself. 11. I have considered the rival submissions and the materials on record. I have also gone through the records produced by the learned Counsel for the respondent-Corporation wherefrom I find that the respondent-Corporation upon floating the fresh tender and on receipt of various tenders has taken a decision to offer the fresh work order to the highest bidder. 12. As regards the prayer of the petitioner for extension of the period of contract, the authority upon a threadbare discussion of the matter, took a conscious decision to go for fresh tender instead of granting further extension to the petitioner.
12. As regards the prayer of the petitioner for extension of the period of contract, the authority upon a threadbare discussion of the matter, took a conscious decision to go for fresh tender instead of granting further extension to the petitioner. Such decision has been taken in view of the admitted fact that the present price of the materials has gone up considerably compared to the earlier price. 13. The only question for determination is as to whether the particular stipulation that the work order would remain valid up to 31.10.2008 subject to extension for another one year depending upon the satisfactory performance would bind the respondent-Corporation to invariably grant extension to the petitioner for another one year. Admittedly, the work order was for the specific period up to 31.10.2008 and for the specific quantity. The petitioner has executed the work order and it was also granted extension for 3 (three) months. In the meantime, it was found that the price of the materials has gone up considerably, which is also evident from the above quoted chart, as indicated in the counter affidavit. The present price being offered by the petitioner is Rs.38.48/MT. As against such price, the respondent-Corporation is getting the price of Rs.3,210/MT. 14. When the particular stipulation speaks of "satisfactory performance", the term will have to be understood in the touchstone of overall scenario and not only the performance of the petitioner. Apart from that, the respondent-Corporation did not bind itself to invariably grant extension of the contractual period by the stipulation made in the work order. After all, the extension of the period of contract cannot be claimed as a matter of course. The very condition itself stipulated that the contract would remain valid up to 31.10.2008, which however, was subject to extension. The expression - "subject to extension" itself means that the same is not automatic. It will be dependant on facts and circumstances including the changed circumstances. 15. The NIT itself indicated that the period of contract would be for two years. The quantity of materials was also indicated. When the petitioner was granted extension for another 3 (three) months by letter dated 19.11.2008, it was clearly stipulated that the contract might be short closed depending on the finalization of new contract.
15. The NIT itself indicated that the period of contract would be for two years. The quantity of materials was also indicated. When the petitioner was granted extension for another 3 (three) months by letter dated 19.11.2008, it was clearly stipulated that the contract might be short closed depending on the finalization of new contract. With such terms, the petitioner accepted the extension and thus, it cannot turn round the same so as to seek Mandamus from this Court for a direction to the respondents to grant full term of extension of one year. By no stress of imagination, the particular stipulation in the work order, which is the foundation of the case of the petitioner cannot be interpreted to be mandatory provision that under any circumstance, the petitioner would be entitled to extension for another one year. As observed above, the term "satisfactory performance" will be inclusive of the satisfactory performance of the contract itself and not the narrow interpretation of the satisfactory performance of the petitioner. 16. For all the aforesaid reasons, the prayer made in the writ petition cannot be granted. Consequently, the writ petition is dismissed. The interim order dated 5.12.2008 stands vacated. Petition dismissed.