Landis+ Gyr Limited, rep, by its General Manager and Authorized Signatory v. The Tamil Nadu Electricity Board, rep. by its Chairman & Others
2009-10-22
K.VENKATARAMAN
body2009
DigiLaw.ai
Judgment :- 1. The petitioner originally came up with the present Writ Petition for the following prayer: “for the issuance of Writ of Certiorarified Mandamus to call for the records relating to the tender bearing No.M-55/2008-2009 floated on 23/01/2009 for supply of Single Phase 520A high quality meters, quashing the actions of the respondent in awarding portions of the same to the other bidders and inviting fresh bids for such supply and directing the respondent to award the Tender in respect of 7,42,000 Single Phase 5-20A high quality meters to the petitioner.” 2. Later, an Application in M.P. No.5 of 2009 was filed for amendment of the prayer and relief that has been sought for now is set out here under. “for the issuance of Writ of Certiorarified Mandamus to call for the records relating to the tender bearing No.M-55/2008-2009 floated on 23/01/2009 for supply of Single Phase 520A high quality meters, quashing the actions of the respondent in awarding portions of the same to the other bidders and quashing the decision of the respondent dated 09/07/2009, and inviting fresh bids for such supply and directing the respondent to award the tender in respect of 7,42,000 Single Phase 5-20A high quality meters to the petitioner.” 3. The facts leading to the filing of the present Writ Petition as put forth in the affidavit in support of the Writ Petition, are set out here under. 1. The Tamil Nadu Electricity Board floated tender on 23/01/2009 for the supply of Single Phase 5-20A high quality meters. The petitioner submitted its tender. The technical - commercial bids received from various bidders including the petitioner were opened on 26/02/2009. The petitioner’s bid was found to be eligible and complying with all the Bid Qualification Requirements (herein after referred to as BQR). Thereafter, the respondent-Board addressed a letter dated 01/04/2009 to the petitioner referring to Clause 15(f) under Schedule B which relates to “Guaranteed Technical Particulars” bringing to the notice of the petitioner that the specification of the material in respect of Register frames was described as “Brass Sheet of not less than 1 mm thickness” in the Tender Specifications and that the petitioner by its offer dated 25/02/2009 named Peraluman. By such letter, the respondent-Board Sought for clarification from the petitioner as to whether its offer was as per the technical specifications. 2.
By such letter, the respondent-Board Sought for clarification from the petitioner as to whether its offer was as per the technical specifications. 2. The petitioner sent a reply dated 01/04/2009 stating that Peraluman is superior than Brass and it has several advantages including shock resistance, greater stability, etc. Further Clause 10.4(v) of the Tender Regulations, 1991 was also pointed out. Consequently, the respondent-Board addressed a letter dated 05/05/2009 informing the petitioner that the board proposed to open its price bid in respect of the said Tender on 06/05/2009 at 2.30 p.m. and requested the petitioner to depute and authorize a representative to be present at the office of the Superintending Engineer at the time of opening the price bid. The said letter also indicated that some of the bidders were rejected after scrutiny of their technical – commercial bids. 3. It is reliably learnt that before intimating the petitioner about the opening of the price bid, the relevant Board Level Tender Committee of the respondent-Board met on 02/05/2009 and specifically listed the petitioner as an eligible tenderer, who had fulfilled both the BQR and technical and commercial specifications and consequently, approved the opening of its price bid. 4. The price bid was opened on 06/05/2009 and the petitioner was found to be the lowest bidder. Thereafter, the petitioner was called to attend price negotiation on 11/05/2009. On the said date, after some deliberations, the petitioner reduced Rs.3/-from the material cost and the revised price was confirmed as Rs.588.63 per meter. However, the petitioner did not receive any formal acceptance from the respondent-Board. 5. Owing the certain protest lodged by the other bidders after opening the price bid on the aspect of Peraluman offered by the petitioner, in order to clarify the position and to avoid any doubts, the petitioner addressed a communication to the respondent-Board on 23/05/2009 stating that though the material offered by it Viz. Peraluman is far superior in Brass, the petitioner however is ready to offer the Brass. 6. It is reliably learnt by the petitioner that the commence which held its meeting on 09/07/2009 proposed to place the order in favour of the petitioner, who was found to be the lowest bidder for the entire tendered quantity of 42. 000 numbers of high quality meters. However, no formal communication was received by the petitioner from the respondent-Board confirming the same. 7.
000 numbers of high quality meters. However, no formal communication was received by the petitioner from the respondent-Board confirming the same. 7. While so, in the month of July, 2009, the petitioner was shocked to know that the respondent-Board had addressed the bidders calling upon them to match the price offered by the petitioner. Immediately, the petitioner addressed a letter dated 21/07/2009 to the Chairman of the respondent-Board bringing to his notice that the petitioner had complied with the render specifications in all respects and the protest made by the other bidders are untenable. The petitioner thereafter, issued a legal notice dated 10/08/2009. However, the petitioner came across an advertisement in the English Daily “The New Indian Express” dated 04/08/2009 by the respondent-Board inviting bids in respect of the very same supplies. In view of the above stated position, the petitioner has approached this Court by filing the present Writ Petition for the relief set out earlier. 4. Counter affidavit was filed on behalf of respondents 1 and 2 bringing forth the following facts: 1. Pursuant to the tender called for by the respondent-Board, 11 firms have offered to supply the product which has been called for by such tender. One of the tenders was rejected as the firm has not satisfied certain BQR and the sample meters of two more firms did not satisfy the same and hence, they were not considered. The petitioner-Firm has offered the material of counter frame other than Brass sheet as specified in the Tender Specification. However, after getting clarification from the petitioner-Company, the matter was placed before the Board Level Tender Committee, the authority to accord approval to open the price bids of the eligible tenderers. 2. The said committee met on 02/05/2009 and accorded approval to open the price bids of eight firms including the petitioner-Firm. The petitioner-Firm was declared as the lowest tenderer by offering Rs.591.93 and the other firms have quoted the rate of Rs.606.18 and they were the second lowest tenderers. 3. The proposal for placing orders on the petitioner was submitted to the Board Level Committee, the authority to recommend the Board. The Committee held its meeting on 04/06/1999 and recommended the proposal to the Full Board, the authority to accord approval for placing of purchase orders for the tenders the value exceeding Rs.10 Crores.
3. The proposal for placing orders on the petitioner was submitted to the Board Level Committee, the authority to recommend the Board. The Committee held its meeting on 04/06/1999 and recommended the proposal to the Full Board, the authority to accord approval for placing of purchase orders for the tenders the value exceeding Rs.10 Crores. The said Board, in its meeting held on 09/07/2009, eliminated the unqualified petitioner by rejecting its offer for supply of Brass counter mechanism. Based on the Board’s direction, the draft purchase orders are under process for procurement of one lakh meters. 4. The claim of the petitioner that Peraluman is the best cannot be ascertained by the Board since the Board has not procured such type of meters in the near future. Thus, the counter affidavit seeks for the dismissal of the Writ Petition. 5. Counter affidavit was filed on behalf of the third respondent, wherein the following facts have been set out: 1. The Board rejected the offer of the petitioner on account of certain technical deviations made by it. The third respondent received a communication dated 16/07/2009 from the Board asking it whether it would agree to match the price quoted by the petitioner for the supply of the product. Immediately, it has expressed its willingness to supply the meters at the quoted price. Thereafter, it was directed to supply 15,666 meters. Further, the other six suppliers have been given similar orders. 2. The case of the petitioner that it did not deviate in any manner from the offer, is denied. There are atleast three major technical deviations as found in the offer of the petitioner. The petitioner has used the Peraluman frame instead of Brass as per the requirement of the Board. Hence, there is a clear deviation from the technical specifications submitted by the petitioner. Further, it has falsely declared as no deviation in the bid document. Peraluman is not the superior material compared to Brass as claimed by the petitioner. Since the petitioner has deviated on three technical specifications, the rejection of the tender of the petitioner is well within law and also as per Clause 21.2(Viii) of the Tender Regulations, 1991. Thus, the counter affidavit seeks the dismissal of the Writ Petition. 6. Counter affidavit was filed by the fourth respondent in tune with the counter affidavit filed by the third respondent. 7. I have heard Mr.
Thus, the counter affidavit seeks the dismissal of the Writ Petition. 6. Counter affidavit was filed by the fourth respondent in tune with the counter affidavit filed by the third respondent. 7. I have heard Mr. R. Murari, assisted by Ms. Preeti Mohan, learned counsel appearing for the petitioner, Mr. S. Ramasamy, learned Additional Advocate General, assisted by Mr. A. Selvendran, learned counsel appearing for respondents 1 and 2 Mr. A.L. Somayaji, learned Senior Counsel assisted by Mr. A.V. Radhakrishnan, learned counsel appearing for respondents 3 and 4. 8. The facts which are not disputed are that - (i) the respondent-Board had floated tender on 23/01/2009 for the supply of high quality meters; (ii) the petitioner, respondents 3 and 4 as well as others have participated in the tender; (iii) on 26/02/2009, the technical – commercial bids received from the bidders including the petitioner, were opened; (iv) the petitioner offered the material viz, Peraluman instead of Brass; (v) on 01/04/2009, the respondent-Board addressed a letter to the petitioner referring to Clause 15(f) under Schedule B which relates to “Guaranteed Technical Particulars” bringing to the notice of the petitioner that the specification of the material in respect of Register frames was described as “Brass Sheet of not less than 1 mm thickness” in the tender specifications, but the petitioner offered the material viz, Peraluman; (vi) on 01/04/2009, a reply was sent by the petitioner stating that Perluman is superior than Brass on several aspects including shock resistance, greater stability, etc,; (vii) on 05/05/2009, the respondent-Board addressed a communication to the petitioner informing it that the board proposed to open the price bids on 06/05/2009 at 2.30 p.m.; (viii) on 06/05/2009, the price bids were opened and the petitioner’s bid was found to be the lowest one; (ix) the petitioner was called to attend the price negotiation at the Member (Distribution) Chambers on 11/05/2009; (x) on 11/05/2009, the petitioner reduced Rs.3/- from the material cost and the revised price was Rs.
588.63 per meter; (xi) on 23/05/2009, in view of certain protest made by other bidders pointing out that the petitioner’s offer of Peraluman was not in conformity with the requirement of the board, the petitioner addressed a letter dated 23/05/2009 that it was ready to offer Brass as well as Peraluman and left the choice to the respondent-Board; (xii) in the month of July, 2009, the other bidders were called upon by the respondent-Board to match the price offered by the petitioner viz., Rs.588.63 per meter; (xiii) on 21/07/2009, the petitioner addressed a communication to the Chairman of the Board bringing to his notice about the entire episode; (xiv) subsequently, since the board attempted to award tender to the other bidders, a legal notice dated 10/08/2009 was sent to the respondent-Board; (xv) the petitioner came across and advertisement in the issue of “The New Indian Express” dated 04/08/2009 inviting bids in respect of the very same supplies by the respondent-Board. 9. on the above said of facts, it has to be seen whether the petitioner has made out any case and that whether it is entitled to the relief that has been sought for by it. 10. The narration of the above facts would indicate that on the basis of the tender floated by the respondent-Board, the petitioner and others including respondents 3 and 4 have participated in the tender. The tender is admittedly governed by Tender Specifications. The Tender Specifications contain several particulars with provisions governing the invitation to bid, the process for the scrutiny of tender, etc. Inter alia requirement is that the persons participating in the tender shall satisfy BQR (Bid Qualification Requirements). If a person does not satisfy BQR, his tender is liable to be summarily rejected. Section-II of the specification deals with BQR. Section-III deals with reasons for rejection of the tender. Clause 1.2 of Section IV states that the tenderers who do not fufil the BQR will not be considered and will be summarily rejected. Clause 5.4 of Section IV states that the date and time of opening of the price bid shall be notified to the bidders who fulfil the BQR criteria and whose bids are found to be commercially and technically acceptable. A reading of Clause 4. 1 reveals that the date and time of opening of the price bids will be notified to the bidders, who fulfil the BQR criteria.
A reading of Clause 4. 1 reveals that the date and time of opening of the price bids will be notified to the bidders, who fulfil the BQR criteria. Admittedly, the petitioner was informed by the respondent-Board through its letter dated 05/05/2009 that it proposed to open the price bid in respect of the tender on 06/05/2009 at 2.30 p.m. and further requested the petitioner to depute an authorized representative to present in the office of Superintending Engineer of the respondent-Board at the time of opening of the price bid. If really the respondent-Board found that the petitioner did not fulfil the BQR criteria and its bid was not technically acceptable, it is not known as to why a letter dated 05/05/2009 is addressed to the petitioner informing about the opening of the price bid. In the context of Clause 4. 1, it has be inferred that the respondent-Board found that the petitioner satisfied the BQR criteria. 11. Further more, the respondent-Board seems to have addressed a communication dated 01/04/2009 to the petitioner bringing to its notice about the specification of the material in respect of register frames as Brass sheet of not less than 1 mm thickness in the tender specification and the petitioner offered the material named Peraluman. The petitioner seems to have sent a reply on the said date setting out that Peraluman was the superior to Brass and it has several advantages including shock resistance, greater stability, etc. The respondent-Board could have replied to the petitioner saying that the specification of the material offered by it, is not found suitable to the respondent-Board. However, as stated already, a communication dated 05/05/2009 was addressed to the petitioner informing it that the respondent-Board proposed to open the price bid in respect of the tender on 06/05/2009. A conjoint reading of Clause 4. 1 of Section IV, the letter dated 01.04.2009 of the respondent-Board seeking clarification, the reply of the petitioner and the letter of the respondent-Board dated 05/05/2009 informing the petitioner about the opening of the price bid on 06/05/2009, will amply establish that the material offered by the petitioner viz, Peraluman instead of Brass was found to be suitable to the respondent-Board and that the respondent-Board was satisfied about the statement made in the reply of the petitioner that Peraluman is superior to brass and it has got several advantages.
Otherwise, there was no need to inform the petitioner about the opening of the price bid especially in the context of Clause 1. that the price bids will be notified to the bidders who fulfil BQR criteria and whose bids are found to be technically and commercially acceptable. The letter addressed by the respondent-Board on 08/05/2009 and the confirmation of the petitioner dated 22/05/2009 would indicate that the respondent-Board is satisfied with the BQR criteria and hence, the price bid of the petitioner was opened and later the petitioner was required to attend a meeting for price negotiation. In fact, after scrutiny, some of the bids were rejected and consequently their price bid was not opened. But in the case of the petitioner, its price bid was opened. 12. Yet another contention that has been put forth on behalf of the petitioner, by the learned counsel appearing for the petitioner, which deserves to be considered is, that Clause 10.4(v) of the Tender Regulations, 1991 reads that if the sample provided by the bidder is found to be superior than the Board’s Specifications/requirement, the same can be accepted without any extra commitment to the board. This will demonstrate that the bidders are entitled to offer superior material. In the case on hand, it is not the case of the respondent-Board that the material offered by the petitioner viz, Peraluman is not superior to Brass. In the counter affidavit, in para 12, the respondent-Board has stated that the petitioner’s claim that the performance of the meter with Peraluman is the best, cannot be ascertained by the Tamil Nadu Electricity Board as the Board had not procured such type of meters in the near future. The said averment made in the counter affidavit will demonstrate that the performance of the metre with Peraluman is not the best, but the Electricity Board is unable to ascertain the same since it has not used such type of meters. Further, the petitioner in his tender form has clearly mentioned about the material viz, Peraluman and hence it cannot be said that the respondents have not seen the tender regarding the said aspect. 13. Yet another aspect that has to be considered is that after opening the price bid on 06/05/2009. The board found that the petitioner was the lowest bidder. Thereupon, for price negotiation, the petitioner was asked to attend the meeting on 11/05/2009.
13. Yet another aspect that has to be considered is that after opening the price bid on 06/05/2009. The board found that the petitioner was the lowest bidder. Thereupon, for price negotiation, the petitioner was asked to attend the meeting on 11/05/2009. In the said meeting, the petitioner reduced a sum of Rs.3/- from the material cost and the revised price was arrived at Rs.588.63 instead of Rs.591.93. 14. Further, Clause 9.2 to Section IV speaks about relaxation of waiver or amendment of the conditions stipulated in the tender. Clause 9.2 is usefully extracted here under. “2. Notwithstanding anything contained in this Specification, the Board reserves the right to; (a) vary the quantity finally ordered to the extent of 25% indicated in the Tender document. (b) split the Tender Quantity and place orders on one or more than one firm to meet the delivery requirements. (c) recover losses, if any, sustained by board, from the supplier who pleads his inability to supply and backs out of his obligation after award of contract. The security deposit paid shall be forfeited. (d) cancel the orders for not keeping up the delivery schedule. (e) accept the lowest tender. (f) revise the quantities at the time of placing orders. (g) reject any or all the tenders or cancel without assigning any reasons therefor. (h) relax or waive or amend any of the conditions stipulated in the tender specification wherever deemed necessary in the best interest of the board.” The said clause found in the Tender Specification will demonstrate that the Board has got discretion to relax or waive or amend any of the conditions stipulated in the Tender Specifications and there is no hard and fast rule for the same. 15. The other contention of the learned counsel appearing for the petitioner which deserves to be considered is that the decision of the Electricity Board dated 09/07/2009 eliminating the bid of the petitioner as unqualified and refusing to accept the letter offered for supply of Brass counter mechanism and to place the orders of the other technically not eligible tenderers, was taken without notice to the petitioner and without hearing the petitioner especially in the context that after BQR, the petitioner being the lowest bidder, was informed about the opening of the price bid and that a negotiation was made for reduction of the price.
However, it is contended on behalf of respondent 3 and 4 that the petitioner need not be informed about the decision taken on 09/07/2009. But, I am unable to accept the contention raised by the learned Senior Counsel appearing for respondents 3 and 4 and I am inclined to accept the contentions raised on behalf of the petitioner. If the material of the petitioner was not in conformity with the specification, it ought not to have been intimated about the price bid and later it ought not to have been called for negotiation for the price. 16. Further, no reasons have been assigned except saying that the board resolved to eliminate the unqualified L1 tendered and not to accept the letter offered for supply counter mechanism. Thus, the contention of the learned counsel appearing for the petitioner that such decision was taken by the board on 09/07/2009 without following the principles of Natural Justice, has to be accepted. 17. The counter affidavit of respondents 1 and 2 does not deal with of met with any of the points raised by the petitioner. Counter affidavit of respondents 3 and 4 points out the technical deviation in the offer of the petitioner. It has also pointed out that when the petitioner has got Perluman frame instead of Brass as per the requirement of the board’s technical specifications, it has falsely declared as no deviation in the bid document. As discussed already, the petitioner has not suppressed that it has mentioned Perluman frame instead of Brass in the tender. Further, as discussed already, for the letter of the respondent-Board dated 01/04/2009 pointing out the same, a reply was sent by the petitioner stating the Peraluman is superior than Brass and it has several advantages like shock resistance, greater stability, etc. and there was no reply from the respondent-Board rejecting the said plea taken by the petitioner and as stated already, the petitioner was called for opening of the bid price. 18. The yet another aspect that has to be considered is that after the board’s decision on 09/07/2009 which also under challenge in the present writ petition, a communication dated 24/08/2009 was sent to the petitioner requesting to extend the validity of its offer upto 15/10/2009. This will indicate that the respondent-Board was still on the offer made by the petitioner. 19.
This will indicate that the respondent-Board was still on the offer made by the petitioner. 19. The discussions made above and the conclusions arrived at by me will amply prove that the petitioner has made out a case in its favour and that the petitioner is entitled for the relief that has been sought for by it in this Writ Petition. However, the respondent-Board is not precluded from getting supply from others if they choose to do so. 20. In fine, the Writ Petition stands allowed. However, there is no order as to costs. Consequently, connected Miscellaneous petitions are closed.