Wipro G. E. Healthcare (P. ) Ltd. v. State of Assam and Ors.
2010-07-02
B.K.SHARMA
body2010
DigiLaw.ai
1. The petitioner company is aggrieved by awarding of the contract ft supply of Positron Emission Tomography (PET)-CT and Medic Cyclotron on turnkey basis to the respondent No. 4 by the impugm order dated 15.2.2010 (Annexure X). According to the petitioner, the action on the part of the respondent authority in doing so is unfair, arbitrary, inequitable and illegal. 2. Shortly stated the facts leading to filing of the instant writ petition are that the respondent No. 1 through the respondent No. 2 had issued an invitation for bid (Annexure A) from the intending manufacturer for supply for installation of PET-CT and Medical Cyclotron on turnkey basis in Gauhati Medical College and Hospital, Guwahati in the Health and Family Welfare Department specifying the closing date and time for receipt of the bids as 30.10.2008 at 1:00 p.m. and opening of the bids at 2:00 p.m. on the same day. The relevant terms and conditions the bid are quoted below: "11.04. Prices quoted by the bidder shall be fixed during the bidder's Performance of the contract and not subject to variation on any account. A bid submitted with an adjustable price quotation will be treated as non-responsive and rejected, pursuant to clause 24. 16. Period of validity of bids 16.01 Bids shall remain valid for 365 (three hundred and sixty five) days after the date of the bid opening prescribed by the purchaser, pursuant to clause 19. A bid valid for a shorter period shall be rejected by the purchaser as non-responsive. 16.02 In exceptional circumstances, the purchasers may solicit the bidder's consent to extension of the period of bid validity. The request and the response thereto shall be made in writing (or by cable or by telex). The bid security provided under clause 15 shall also be suitably extended. A bidder may refuse the request without forfeiting its bid security. A bidder granting the request will not be required nor permitted to modify its bid. Section - V. TECHNICAL SPECIFICATION Technical Specification for PET - C T and Medical Cyclotron SI. No. Technical Specification (i) Scope of the Work : Primary vendor shall be responsible for (ii) Site Preparation : Design, Planning and construction on turnkey basis, adhering to all the prescribed safety guidelines and GMP Regulations. (iii) Supply, Installation, Commissioning and Seamless functioning of the entire system.
No. Technical Specification (i) Scope of the Work : Primary vendor shall be responsible for (ii) Site Preparation : Design, Planning and construction on turnkey basis, adhering to all the prescribed safety guidelines and GMP Regulations. (iii) Supply, Installation, Commissioning and Seamless functioning of the entire system. (iv) Any option or added facilities not indicated in the specifications may also be given. Any improve modification or updated version of the system can be included in the quotations. (v) Civil Works costs to be quoted separately as per actual requirements for the facility. (vi) A latest whole body Positron Emission Tomography System integrated multislice spiral CT Scanner designed for providing volume measurements of metabolic and Physiological process using Positron Emitters, as well as for producing accurate structural and Anatomical fusion images and making attenuation maps for attenuation correction. (vii) The system should have capability for simultaneous data Acquisition, processing, image reconstruction and analysis and fusion of PET with CT images. (viii) The system should operate on 22(± 10) V A/C (single phase) 50 HZ or 440 V (±20)A/C (3 phase) 50 HZ." 3. Although the last date of submission of bids was specified as 30.10.2008, but vide Annexure B notice dated 23.10.2008 the said last date was extended and it was intimated that the said extended date would be notified later on. 4. In pursuance to the invitation for bid, the representatives of the petitioner attended the pre-bid meeting held on 15.11.2008. According to the petitioner, its understanding was that the Government Assam wanted to draw out the most optimum specification of PET - CT Scanner in a fair and transparent manner by ensuring participation from all major manufacturers. The corrigendum dated 17.11.2008 was issued by the respondent No. 3 on behalf of the respondent No. 2 changing some of the terms and conditions mentioned in the original invitation for bids. The petitioner has specifically mentioned about clause B of the said corrigendum and the same is quoted below : "B. Page 40 l.l(i) Gantry and detectors : The PET scanner should employ non-hygroscopic schintillation material add "LSO/LYSO with latest technology" for detecting 511 KeV gamma photons in coincidence is to be incorporated and delete the sentence "crystal materials with decay rate below 60 nano second and should be mentioned in the offer." 5.
According to the petitioner, the said corrigendum with the specifications has been made with a view to eliminate the manufacturer like the petitioner. The authorized signatories of the petitioner made a communication dated 28.11.2008 to the respondent No. 3 expressing its apprehension that the said corrigendum would eliminate the major manufacturer like the petitioner and that the same would further limit the choice having regard to the limited manufacturers of the product. It was further intimated that the GE PET-CT scanner are based on BGO Crystal Technology that has perfected over the years and BGO Crystal has the best sensitivity which ensures superior image quality and faster scanning with non-equivalent count rate. It was also mentioned in the communication that the General Electric enjoys a 50+% market share worldwide and in India 19 out 27 PET/CT systems are from GE Healthcare. The petitioner sought for editing the specification to enable BGO Crystal enabling the petitioner to make a commercial offering with their Discovery VCT only with the latest BGO Crystal. 6. By Annexure E dated 12.12.2008, it was intimated that the last date of submission of bid was extended up to 17.12.08 at 2:00 p.m. and the bids were to be opened on the same date at 3:00 p.m. The notice further indicated that other terms and conditions of the invitation for bid and corrigendum would remain unchanged. The respondent No. 3 by his Annexure F communication dated 12.12.2008 informed the petitioner that the technical evaluation would be done holistically and after looking at the field performance of different PET-CT scan including Cyclotron. It was further intimated that for not having only a particular type of parameter would not lead to disqualification if other parameters of the tender were achieved. The petitioner was requested to participate in the tender process which was extended up to 2:00 p.m. on 17.12.2008. 7. Pursuant to the aforesaid developments, the petitioner submitted its bid and the respondent No. 3 by its communication dated 21.1.2009 informed the petitioner that in the meeting held on 20.1.2009 with the Technical Committee, it was observed that the criterion laid down in the specification of the bid documents for purchase of one PET-CT scanner with Cyclotron clearly stated that Crystal material for PET-CT scanner is LSO/LYSO. However, the bid submitted by the petitioner was BGO based Crystal which was a clear deviation from the specification laid down.
However, the bid submitted by the petitioner was BGO based Crystal which was a clear deviation from the specification laid down. In the communication it was further intimated that to a specific query made by Technical Committee, the representatives of the petitioner had answered that Discovery RX Units with LYSO Crystals are installed in various selected centres all over the world (except India) and are made for research and development purpose only and not for commercial use. 8. Accordingly by the said communication the petitioner was asked to substantiate the aforesaid statements of the representatives of the petitioner by providing a sworn affidavit from the Principals, i.e., GE Healthcare at USA, stating that all PET-CT scanner with LYSO Crystal (Discovery RX) operating in various centres as on today are meant for research and development works only and not for commercial purpose with respective dates of installation and name of the institutes within 7 days. The petitioner was also directed to furnish a statement that a Medical Physicist for production of FDG shall be available locally in Guwahati as per Tender Document. On perusal of the said communication, the petitioner by its Annexure H communication dated 29.1.2009 apprised the respondent No. 3 that the petitioner has written to their Principals GE Healthcare, USA to furnish declaration as sought for. The petitioner sought for extension of time till 6.2.2009 for sending the petitioner's response as the concerned people were not available at their respective locations. Thereafter, the respondent No. 3 by his Annexure I communication dated 2.2.2009 informed the petitioner that the time was extended up to 6.2.2009 for submission of the required documents. It was also indicated that no further extension would be granted. 9. After the aforesaid developments, the petitioner by its Annexure J communication dated 5.2.2009 submitted the response to the aforesaid query made by the respondents. Along with the said communication the petitioner enclosed a copy of the detailed response from GE Healthcare, USA, i.e., the Principals of the petitioner. An affidavit was also submitted by the Regional Manager (East) in terms with their response. The respondent No. 2 in response to the said communication dated 5.2.2009 made another communication dated 18.2.2009 informing the petitioner that the clarification and the affidavit submitted by the petitioner were not in conformity as requested.
An affidavit was also submitted by the Regional Manager (East) in terms with their response. The respondent No. 2 in response to the said communication dated 5.2.2009 made another communication dated 18.2.2009 informing the petitioner that the clarification and the affidavit submitted by the petitioner were not in conformity as requested. The petitioner was asked to submit a fresh affidavit from their Principal mentioning that by their PET-CT scanner with LYSO based Crystal (Discovery RX) operating in various centres as on date were meant for research and development purpose only and not for commercial purpose. Such affidavit was directed to be submitted by 21.2.2009. 10. The petitioner by its communication dated 20.2.2009 clarified/confirmed to the respondent No. 3 that during the discussion with Technical Committee on 20.1.2009 and subsequently through its letter dated 4.2.2009, it was explained that the petitioner has a small number of installation of LYSO Crystal Detector Systems under Clinical Research Collaborations and that the systems are being deployed by the petitioner to carry out Clinical Research and that collaboration of the petitioner are at liberty to use them for commercial purpose as well. Thus, it was contended that it would be incorrect to say that the systems of the petitioner are meant for only research and development works and not for commercial purpose. It was further stated in the said communication that on the basis of the published scientific studies, it was established that BGO is a high performing Crystal material due to its superior sensitivity and noise equivalent count rate. In the said communication assurance was furnished that in case the Technical Committee still felt that LYSO Crystal Detector would be considered for purchase, the petitioner was willing to supply the same in lieu of the BGO Crystal Detector and as a special case, there will be no change in the pricing of the system and the original price bid submitted by the petitioner shall remain unchanged. 11. The petitioner was directed to attend the technical meeting to be held on 23.2.2009 at 11:00 a.m. in the office of the respondent No. 3. According to the petitioner when the aforesaid communications between the parties were on, the Principals of the petitioner had launched on commercial basis globally the Discovery PET-CT 600 series Scanner (Discovery PET-CT 600 and Discovery PET-CT 690) designed to help and enable early detection and accurate monitoring of the disease.
According to the petitioner when the aforesaid communications between the parties were on, the Principals of the petitioner had launched on commercial basis globally the Discovery PET-CT 600 series Scanner (Discovery PET-CT 600 and Discovery PET-CT 690) designed to help and enable early detection and accurate monitoring of the disease. It was further informed that as a special case, the petitioner was willing to supply the Discovery PET-CT 690 in lieu of the Discovery VCT at same price quoted earlier. 12. The respondent No. 3 by its communication dated 24.3.2009 asked the petitioner to submit fresh technical and price bid for purchase of PET-CT scanner with cyclotron in turnkey basis to Gauhati Medical College and Hospital. It was further mentioned in the said communication that the earnest money deposited should also be extended accordingly which should be valid for 365 days from the date of opening of the Technical bids. The petitioner was asked to submit the revised bid on or before 3.4.2009 at 1:00 p.m. The other conditions of the invitation for bid remained unchanged. 13. The petitioner on receipt of the said communication dated 24.3.2009 while expressing gratitude for allowing the petitioner to submit fresh technical price bid for PET-CT scanner on turnkey basis by its letter dated 25.3.2009 also intimated that it had offered to supply its latest product Discovery 690 based on LYSO Crystal whereas the respondent No. 4 had offered Biograph 64 True Point instead of its latest 64 Row Detector PET-CT scanner system Biograph MCT. Further information furnished was that the petitioner's product is 16.5 meV compared to 11 meV of the respondent No. 4. Under such circumstances, the petitioner made a request for favourable direction from the Technical Committee in the tender process. 14. In terms of the aforesaid developments, the petitioner submitted its Technical bid on 1.4.2009. It was mentioned in the Technical bid that the equipment offered by the respondent No. 4 was much inferior and also obsolete compared to superior and latest equipment offered by the petitioner. 15. The respondent No. 3 by its communication dated 27.4.2009 (Annexure R) intimated both the parties, i.e., the petitioner and the respondent No. 4, that the price bid would be opened on 24.8.2009 at 11:00 a.m. and accordingly requested the parties to depute some senior officials and who can clarify the price bid and take spot decisions on the commercial matter.
The respondent No. 3 by its communication dated 27.4.2009 (Annexure R) intimated both the parties, i.e., the petitioner and the respondent No. 4, that the price bid would be opened on 24.8.2009 at 11:00 a.m. and accordingly requested the parties to depute some senior officials and who can clarify the price bid and take spot decisions on the commercial matter. Pursuant to such opening of the price bids, the petitioner submitted yet another letter dated 29.4.2009 to the respondent No. 3 informing of the various mandatory deviations purportedly committed by the respondent No. 4. It was also stated that taking into account 10 years life cycle cost, the price offered by the petitioner was around one crore less than that of the respondent No. 4. 16. On receipt of the communication dated 29.4.2009 made by the petitioner, it was informed that same had been forwarded to the Legal Department and that a decision in the matter was awaited. According to the petitioner, the respondent had shown unresponsive attitude and accordingly the petitioner by its communication dated 19.5.2009 reminded the respondents of the matter. However, nothing yielded and the petitioner could come to know that the respondent authority had already finalized the matter towards allotting the contract to the respondent No. 4. Situated, thus, the petitioner invoked the writ jurisdiction of this court by filing a writ petition making a grievance against the proposal for allotment of the contract to the respondent No. 4. The petition was registered and numbered as WP(C) No. 2084/2009 and the same was disposed of by Annexure W order dated 3.6.2009 providing that the competent authority would take a decision in the tender process and while doing so should take note of the grievance raised by the petitioner through their representations. The said order was passed in view of the communication dated 29.5.2009 addressed to the writ petitioner by the respondents indicating that its representation would be considered in the next meeting by the competent committee constituted for evaluating the tender. 17.
The said order was passed in view of the communication dated 29.5.2009 addressed to the writ petitioner by the respondents indicating that its representation would be considered in the next meeting by the competent committee constituted for evaluating the tender. 17. After disposal of the writ petition in the above manner, the impugned I Annexure X communication has been made to the petitioner by the respondent No.3 intimating about the approval of the Government in the Health and Family Welfare Department regarding procurement and installation of PET-CT with Medical Cyclotron on turnkey basis for Gauhati Medical College and Hospital from the L-l bidder, i.e., the respondent No. 4. According to the petitioner such a course of action adopted by the respondents is illegal and in clear violation of the aforesaid order dated 3.6.2009 passed by this court providing consideration of the grievance of the petitioner. It is the stand of the petitioner that the respondents while awarding the contract to the respondent No. 4 did not take into account the points raised by the petitioner in their representations. It is the stand of the petitioner that since the respondent No. 4 deviated from requirement of clause 16.1 of the tender document by not providing bid validity period of 365 days, their bid ought to have been rejected. Be it stated here that the respondent No. 4 had initially provided bide validity of 180 days, but later on increased the same to 365 days. Another contention raised by the petitioner is that the equipment offered by the petitioner being the latest and the one offered by the respondent No. 4 being inferior and obsolete, the respondents ought not have accepted the bid offered by the respondent No. 4. 18. The respondents have filed their counter affidavits. In the affidavit filed by the official respondents, the details of sequence of events have been furnished. It has been stated that the technical committee recommended PET-CT scanner having LSO/LYSO Syntillating material with latest technology for detecting 511 Kev gamma photons by way of amendment to the original tender along with some other amendments and accordingly the corrigendum was also issued.
It has been stated that the technical committee recommended PET-CT scanner having LSO/LYSO Syntillating material with latest technology for detecting 511 Kev gamma photons by way of amendment to the original tender along with some other amendments and accordingly the corrigendum was also issued. Reacting to the stand of the representatives of the petitioner that the PET-CT scanner with LYSO Crystal of Wipro GE are not installed anywhere in the world for commercial purpose, the respondents insisted for substantiation of the same by the petitioner through a sworn affidavit from the Principals of GE (Medical), USA. However, the petitioner did not comply with the same and instead stated only the finer points of BGO Crystal technology. Although the petitioner failed to substantiate its claim that PET-CT scanner are not available for commercial purpose, but they were given another opportunity to confirm the same by submitting the affidavit fixing the date of submission on 21.2.2009. 19. Reacting to the statement made in paragraph 17 of the writ petition that "it would be incorrect to say that the systems are meant for only research and development works and not for commercial purpose" it has been stated by the respondents that such a statement has been made only in the writ petition, but the petitioner failed to state the same by sworn affidavit as was directed. The respondents have objected this particular statement which according to them is contrary to the earlier stand of the petitioner. It has also been stated that the petitioner delayed the matter considerably and it was only at a later stage it declared that it would be able to supply LYSO based PET-CT scanner. 20. As regards the plea of the petitioner that the price offered by it has taken into account 10 years life cycle cost, the respondents have stated that same is not correct because the price are inclusive of 5 years warranty, installation, commissioning, manpower (a physicist, a chemist) for operation of cyclotron and chemist lab and consumables for 5 years. According to the respondents, same criteria were applied for respondent No. 4. As regards the plea of the petitioner that the respondents having not offered price validity for 365 days, it has been stated that as per the advice of the purchase committee such validity period has been obtained from the respondent No. 4. 21.
According to the respondents, same criteria were applied for respondent No. 4. As regards the plea of the petitioner that the respondents having not offered price validity for 365 days, it has been stated that as per the advice of the purchase committee such validity period has been obtained from the respondent No. 4. 21. In the counter affidavit filed by the respondent No. 4 also, the contentions raised in the writ petition have been denied. It is the stand of the respondent No. 4 that the competent authority taking into account all the relevant facts and circumstances has rightly warded the contract to the respondent No. 4 and the petitioner should not make any grievance against the same. The petitioner has also filed an affidavit in reply to the affidavit filed by the respondents. In the affidavit so filed, the stand of the petitioner in the writ petition has been reiterated. 22. I have heard Mr. D. Baruah, learned counsel for the petitioner as well as Mr. D. Saikia, learned Standing counsel, Health Department. I have also heard Mr. S. Talukdar, learned senior counsel assisted by Mr. I. Lahiri, learned counsel for the respondent No. 4. I have also considered the entire materials on record. 23. Mr. Baruah, learned counsel for the petitioner upon a reference to the entire materials on record, submitted that the respondents in spite of its undertaking that the representation submitted by the petitioner would be considered and the earlier writ petition having been disposed of by taking note of the said undertaking, the respondents acted illegally and arbitrarily in not taking into account the said representation towards awarding the contract to the respondent No. 4. Referring to clause 16.01 of the Tender document which provides that bid would remain valid for 365 days after the date of bid opening prescribed by the purchaser and that bid valid for a shorter period shall be rejected by the purchaser as non-responsive, Mr. Baruah, learned counsel for the petitioner submitted that the respondent No. 4 having submitted the bid with validity period of 180 days, its bid ought to have rejected at the very threshold. According to him, the equipment provided by the respondent No. 4 being inferior in quality and obsolete and the one provided by the petitioner being latest, the respondent ought not to have accepted the bid offered by the respondent No. 4. 24.
According to him, the equipment provided by the respondent No. 4 being inferior in quality and obsolete and the one provided by the petitioner being latest, the respondent ought not to have accepted the bid offered by the respondent No. 4. 24. Mr. D. Saikia, learned Standing counsel, Health Department countering the above argument advanced by Mr. Baruah, submitted that the respondents have taken a very fair decision in the matter and at every stage duly considered the representations made by the petitioner. As regards the controversy relating to the bid validity period which is stated to be lesser than the one fixed in the bid documents, Mr. Saikia, learned Standing counsel, Health Department upon a reference to clause 24.06 of the tender document, submitted that the purchaser has a right to waive any minor infirmity or non-conformity or irregularity in a bid which does not constitute a material deviation. By referring to the records produced by him containing the decision making process, he submitted that in absence of any allegation of mala fide and colourable exercise of power in the decision making process, the writ court will be reluctant to sit on appeal over the findings arrived at by the expert committee constituted for the purpose of awarding the contract. He has placed reliance on the following decisions : (1) Poddar Steel Corporation v. Ganesh Engineering Works and Ors., (1991) 3 SCC 273 . (2) BSAT Joshi and Sons Ltd. v. Nair Coal Services Ltd. and Others, (2006) 11 SCC 548 . 25. Mr. S. Talukdar, learned senior counsel for the respondent No. 4 adopting the argument advanced by Mr. Saikia, learned Standing counsel, Health Department, submitted that the deviation in respect of bid validity period from 365 days to 180 days was a minor variation and as per the provision of clause 24.06 and 24.07 of the Tender document, such a minor deviation is within the competence and jurisdiction of the competent authority to be waived. Clause 24.07 provides that the purchaser's determination as to the substantial responsiveness or otherwise of each bid or consideration of a minor informality or non-conformity or irregularity is final and conclusive. He has also placed reliance on certain decisions which are as follows : (1) Tata Cellular v. Union of India, (1994) 6 SCC 651 .
Clause 24.07 provides that the purchaser's determination as to the substantial responsiveness or otherwise of each bid or consideration of a minor informality or non-conformity or irregularity is final and conclusive. He has also placed reliance on certain decisions which are as follows : (1) Tata Cellular v. Union of India, (1994) 6 SCC 651 . (2) Meerut Development Authority v. Association of Management Studies and Anr., (2009)6 SCC 171 , (3) Air India Ltd. v. Cochin International Airport and Others, (2000)2 SCC 617 . (4) Jagdish Mandal v. State ofOrissa, (2007) 14 SCC 517. 26. Although the petitioner has criticized Annexure C corrigendum by which changes had been made to the terms and conditions mentioned in the original invitation of bids on the ground that such changes would eliminate all major manufacturers like the petitioner, but the fact of the matter is that the petitioner was never eliminated, rather it fully participated in the tender process. By Annexure F communication dated 12.12.2008, the petitioner was informed that technical evaluation would be done holistically and after looking at the field performance of different PET-CT Scan including Cyclotron. It was intimated that for not having only a particular type of parameter would not lead to disqualification if other parameters of the tender are achieved. The petitioner was provided with opportunity even to the extent of re-submission of technical and price bids. The petitioner was informed by Annexure -G communication dated 21.1.2009 that in the meeting of the Technical Committee held on 20.1.2009 it was observed that the criteria laid down in the specification of bid document for purchase of one PET-CT scanner with cyclotron clearly stated that the crystal materials for PET is LSO/LYSO. However the bid Submitted by the petitioner was BGO based on Crystal which was a clear deviation from the specification laid down. The petitioner was informed by the said communication that to a specific query by the Technical Committee, the answer of the representatives of the petitioner was that the Discovery RX units with LYSO Crystal are installed in various selected centres all over the world except India and are made for research and development purpose only and not for commercial use. 27.
27. It was in the aforesaid circumstances instead of eliminating the petitioner from the race, it was asked by the aforesaid communication to substantiate the statements by providing a sworn affidavit from the Principals, i.e., GE Health Care at USA. Admittedly there was failure on the part of the petitioner to do so. Although extension was granted to the petitioner till 6th February, 2009 for submission of documents, but there was no compliance of the requirement spelt out in the said communication. The affidavit filed was by the Regional Manager. It was in such circumstances, the respondent No. 2 by its communication dated 18.2.2009 informed the petitioner that the clarifications in the affidavit submitted by the petitioner were not in conformity with the specifications made in the aforesaid communication dated 21.1.2009. The petitioner was again asked to submit a sworn affidavit as requested earlier. Instead of doing so, the petitioner by its communication dated 20.2.2009 intimated the respondent No. 2 that it has a number of installation LYSO Crystal detector system under clinical research collaboration and that the same can be used for commercial purpose. Deviating from the earlier stand, the petitioner in its said communication contended that it would not be correct to say that the systems are meant for research and development purpose only and not for commercial purpose. However, while saying so, the petitioner insisted that BGO is a high performing crystal material due to its superior sensitivity and noise equivalent count rate. 28. In view of the above, the respondents could have rejected the petitioner's bid, but instead asked the petitioner to attend the Technical Committee meeting to be held on 20.3.2009. Thereafter, the petitioner was also provided with opportunity to submit fresh technical and price bids. While conveying the said decision, the petitioner was also intimated that the earnest money deposited should also be extended accordingly which should be valid for 365 days from the date of opening of the ; technical bids. Although the petitioner by its Annexure P communication dated 25.3.2009 submitted fresh technical and price bids for PET-CT, scanner and Medical Cyclotron on turnkey basis, but it expressed its reservation about the offer made by the respondent No. 4.
Although the petitioner by its Annexure P communication dated 25.3.2009 submitted fresh technical and price bids for PET-CT, scanner and Medical Cyclotron on turnkey basis, but it expressed its reservation about the offer made by the respondent No. 4. Thereafter, the petitioner by its Annexure Q letter dated 1.4.2009 while submitting technical bid again insisted that the equipment offered by the respondent No. 4 was much inferior and also obsolete compared to the superior and latest equipment offered by the petitioner. 29. From the above, what is seen is that the petitioner apart from levelling allegation against the respondent No. 4 also kept on deviating from the requirement of the specifications by insisting for BGO Crystal Technology, but the respondents allowed it to participate in the tender process and upon such participation along with the respondent No. 4, the respondents decided to allot the contract to the respondent No. 4. Thus, it cannot be said that there was no transparency and fair play in the matter. At each and every stage, the respondents showed its response to the communication made by the petitioner. Be it stated here that the price difference between the offer made by the petitioner and the respondent No. 4 is about two crores. 30. According to the petitioner, the bid validity period offered by the respondent No. 4 being for 180 days as against the requirement of 365 days stipulated in the invitation of bid, its bid ought to have been rejected. It is on record that the respondent No. 4 although specified the bid validity period as 180 days, but the earnest money deposited by them covers 365 days. Further, the purchase committee advised the Director of Medical Education, i.e., the respondent No. 2, to obtain the price validity for 365 days from the respondent No.4, i.e., L-1 vendor towards approaching the Government for final decision in the matter for placing the purchase order. Accordingly, the matter was forwarded to the Government for approval vide letter dated 9.7.2009. In response to the Government letter dated 8.2.2010, the purchase order was issued on 15.2.2010. It is an admitted position that there was only two bidders at the final stage and the purchase committee before finalization of L-l bidder took an undertaking from the respondent No. 4 for price validity of 365 days.
In response to the Government letter dated 8.2.2010, the purchase order was issued on 15.2.2010. It is an admitted position that there was only two bidders at the final stage and the purchase committee before finalization of L-l bidder took an undertaking from the respondent No. 4 for price validity of 365 days. It was only after such formalities, the bid was offered to the respondent No. 4. 31. It has been contended by the respondent No. 4 in its affidavit that the bid validity of 180 days was obviously a mistake inasmuch as the bank guarantee furnished by it was validity for 15 months. When the said mistake was pointed out, the respondent No. 4 immediately confirmed that the validity period of its offer was for 365 days. It was by Annexure R/6 letter dated 23.11.2009, the respondent No. 4 confirmed the validity of its offer for 365 days. 32. The records produced by Mr. Saikia, learned Standing counsel, Health Department have been perused. On perusal of the said records/file, what has revealed is that the respective cases of both the parties was considered in details. The plea of the petitioner that its representation was not considered, is not at all correct. The points raised by the petitioner in its representation were duly considered in reference to the order dated 3.6.2009 passed by this court in WP(C) No. 20847 2009. It is upon a threadbare discussion and taking note of the objection raised by the petitioner, it was pointed out that as per clause 24.06 of the bid document the purchaser may waive any minor infirmity or non-conformity or irregularity in bid which does not constitute a material deviation. It is upon such threadbare discussions on the points raised by the petitioner, a conscious decision was taken to award the contract to the respondent No. 4 whose bid is also lower than the bid offered by the petitioner. In fact, the difference between the two is about two crores. The authorities also took necessary opinion from the legal department and it was only after such process, the decision was taken to award the contract to the respondent No. 4. The decision of the purchase committee to award the contract to the respondent No. 4 got finalized at the hands of the Government only after taking note of all the points raised in the representation made by the petitioner. 33.
The decision of the purchase committee to award the contract to the respondent No. 4 got finalized at the hands of the Government only after taking note of all the points raised in the representation made by the petitioner. 33. If the deviation made by the petitioner could be waived by the appropriate authority there cannot be any earthly reason as to why the minor variation of the bid validity period cannot be condoned by the said authority. It was only after taking the undertaking from the L-l bidder, i.e., respondent No. 4, regarding extension of bid validity for 365 days, the contract was awarded to it. 34. In Poddar Steel Corporation (supra), the Apex Court held that minor technical irregularity can be waived and that deviation from non-essential or ancillary/subsidiary requirement is permissible. In paragraph 6 of the judgment it was observed thus; "6,... As a matter of general proposition it cannot be held that an authority inviting tenders is bound to give effect to every term mentioned in the notice in meticulous detail, and is not entitled to waive even a technical irregularity of little or no significance. The requirements in -a tender notice can be classified into two categories - those which lay down the essential conditions of eligibility and the others which are merely ancillary or subsidiary with the main object to be achieved by the condition. In the first case the authority issuing the tender may be required to enforce them rigidly. In the other cases it must be open to the authority to deviate from and not to insist upon the strict literal compliance of the condition in appropriate cases..." 35. In BSN Joshi and Sons Ltd. (supra), the Apex Court observed that if a deviation is made in relation to all the parties in regard to any condition, ordinarily the power of relaxation is held to be existing. It was further observed that having regard to the fact that huge public money was involved, the public sector undertaking in view of the principles of good corporate governance may accept the tenders which are economically beneficial to it by invoking the power of relaxation. In the instant case, clause 24.06 and 24.07 of the bid documents provide the purchaser the power to waive the minor infirmity or non-conformity or irregularity in a bid.
In the instant case, clause 24.06 and 24.07 of the bid documents provide the purchaser the power to waive the minor infirmity or non-conformity or irregularity in a bid. The authorities have invoked the said provisions as reflected in the relevant file and in the counter affidavit filed by the official respondents. 36. Tata Cellular (supra), case has been pressed into service to emphasize on the scope of judicial review in respect of Government contracts. It is only the decision making process and not the merit of the decision itself which is reviewable as the court does not sit on appeal while exercising the power of judicial review. The test is whether the wrong is of such a nature as to require intervention of the court. In the said decision, it has also been emphasized that the court would not substitute its own opinion for that of the experts. 37. In Meerut Development Authority (supra), the Apex Court dealing with the scope of judicial review in contractual matters and the test whether the decision of the authority is vitiated by any arbitrariness and, therefore, hit by article 14 of the Constitution of India, put emphasis on the power of the State and its instrumentalities in such matters and as to how it is not bound to accept the highest or lowest bid as the case may be. It was emphasized that reasonableness of the decision making process is the test. Dealing with the scope of judicial review in Contractual matters in the touchstone of article 14 of the Constitution of India and public interest, the Apex Court observed, thus : "25. Having regard to the above submissions, we propose to deal with the matter from the following four aspects : (a) What is the nature of rights of a bidder participating in the tender process ? (b) The scope of judicial review in the contractual matters : (c) Whether the decision of the Authority is vitiated by any arbitrariness and, therefore, hit by article 14 of the Constitution of India? (d) Whether the decision is not in public interest? 26. A tender is an offer. It is something which invites and is communicated to notify acceptance. Broadly stated it must be unconditional; must be in, the proper form, the person by whom tender is made must be able to and willing to perform his obligations.
(d) Whether the decision is not in public interest? 26. A tender is an offer. It is something which invites and is communicated to notify acceptance. Broadly stated it must be unconditional; must be in, the proper form, the person by whom tender is made must be able to and willing to perform his obligations. The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. However, a limited judicial review may be available in cases where it is established that the terms of the invitation to tender were so tailor-made to suit the convenience of any particular person with a view to eliminate all others from participating in the bidding process. 27. The bidders participating in the tender process have no other right except the right to equality and fair treatment in the matter of evaluation of competitive bids offered by interested persons in response to notice inviting tenders in a transparent manner and free from hidden agenda. One cannot challenge the terms and conditions of the tender except on the abovestated ground, the reason being the terms of the invitation to tender are in the realm of the contract. No bidder is entitled as a matter of right to insist the authority inviting tenders to enter into further negotiations unless the terms and conditions of notice so provided for such negotiations. 28. It is so well settled in law and needs no re-statement at our hands that disposal of the public property by the State or its inst in mentalities partakes the character of a trust. The methods to be adopted for disposal of public property must be fair and transparent providing an opportunity to all the interested persons to participate in the process. 29. The Authority has the right not to accept the highest bid and even to prefer a tender other than the highest bidder, if there exist good and sufficient reasons, such as, the highest bid not representing the market price but there cannot be any doubt that the Authority's action in accepting or refusing the bid must be free from arbitrariness or favoritism. 41. The distinction between appellate power and a judicial review is well known but needs reiteration.
41. The distinction between appellate power and a judicial review is well known but needs reiteration. By way of judicial review, the court cannot examine the details of the terms of the contract which have been entered into by the public bodies or the State. The courts have inherent limitations on the scope of any such enquiry. If the contract has been entered into without ignoring the procedure which can be said to be basic in nature and after an objective consideration of different options available taking into account the interest of the State and the public, then the court cannot act as an appellate court by substituting its opinion in respect of selection made for entering into such contract. But at the same time the courts can certainly examine whether the "decision-making process" was reasonable, rational, not arbitrary and violative of article 14." 38. In Air India Ltd. (supra), dealing with the award of the contract of the State or its instrumentalities, the Apex Court observed that even when some defect is found in the decision making process, the court must exercise its discretionary power under article 226 of the Constitution of India with great caution and should exercise it only in furtherance of public interest and not merely on making out a legal point. In paragraph 7 of the judgment, it has been observed, thus : "7.... The award of a contract, whether it is by a private party or by a public body or the State, is essentially a commercial transaction. In arriving at a commercial decision considerations which are paramount are commercial considerations. The State can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. It can enter into negotiations before finally deciding to accept one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to he the highest or the lowest. But the State, its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot depart from them arbitrarily.
It may not accept the offer even though it happens to he the highest or the lowest. But the State, its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot depart from them arbitrarily. Though that decision is not amenable to judicial review, the court can examine the decision-making process and interfere if it is found vitiated by mala fides, un-reasonableness and arbitrariness. The State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision-making process the court must exercise its discretionary power under article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should intervene." 39. In Jagdish Mandal (supra), the Apex Court has observed that the scope of judicial review is to see as to whether the choice or decision is made "lawfully" and not to check whether choice or decision is "sound". Evaluating of tender and awarding of a contract are essentially commercial features and principles of equity and natural justice stay at distance in such matters. If the decision is bona fide and in public interest, then even if there is procedural aberration or error in assessment or prejudice to a tenderer, same by itself will not be the vitiating factor. 40. In the instant case, through out the entire process of tender, equal opportunity was given to both the bidders. Although the petitioner insisted for a particular equipment other than the one insisted upon by the respondents, but the respondents instead of rejecting its bid gave another opportunity to conform to the requirement of the specification. There was also failure on the part of the petitioner to furnish required information about which discussions have been made above. However, the respondents did not reject the bid offered by the petitioner and allowed it to participate and compete with the respondent No. 4.
There was also failure on the part of the petitioner to furnish required information about which discussions have been made above. However, the respondents did not reject the bid offered by the petitioner and allowed it to participate and compete with the respondent No. 4. The records have revealed that at each and every stage the offer/offers made by the petitioner were considered and it was only after taking into account all the relevant factors, the purchase committee decided to award the contract to the respondent No. 4 subject to approval of the Government as aforesaid. The Government in Health and Family Welfare Department in due consideration of the materials including the objections raised by the petitioner in its representation, took a conscious decision to award the contract to the respondent No. 4.1 see no reason as to why such a decision should be faulted with. 41. At the first instance, the petitioner instead of meeting the specification of LSO/LYSO, insisted for BGO based crystal. Prior to that, it also made a grievance against the corrigendum dated 17.11.2008 on the ground that same would eliminate the manufacturers like the petitioner. The petitioner also contended before the respondent authority that the particular LYSO brand is meant for research and development works only and not meant for commercial purpose. On its failure to substantiate such a claim, it deviated from the said stand and communicated to the respondents that the same is also available for commercial purpose. However, while stating so, once again contended that BGO is a high performing Crystal material. Not only that, they also questioned the equipment offered by the respondent No. 4. 42. In view of the aforesaid deviation made by the petitioner, it was open for the respondents to reject its bid, but instead provided opportunity at each and every stage giving opportunity of full participation in the tender process even to the extent of submission of fresh/revised technical and price bids. Thereafter, the expert body considered the matter in its entirety including the objections raised in the representation submitted by the petitioner and took the conscious decision to award the contract to the respondent No. 4. The relevant file containing the decision making process does not suggest even remotely that the said decision is vitiated by any material irregularity.
Thereafter, the expert body considered the matter in its entirety including the objections raised in the representation submitted by the petitioner and took the conscious decision to award the contract to the respondent No. 4. The relevant file containing the decision making process does not suggest even remotely that the said decision is vitiated by any material irregularity. There is nothing to suggest that rejection of the bid of the petitioner and/or acceptance of the same offered by the respondent No. 4 is irrational, unreasonable or arbitrary. 43. As has been observed by the Apex Court in Jagdish Mandal (supra), while invoking the power of the judicial review in matters as to tenders or award of contracts, certain special features should be borne in mind that evaluation of tenders and awarding of contracts are essentially commercial functions and principles of equity and natural justice stay at a distance in such matters. If the decision relating to award of contract is bona fide and is in public interest, courts will not interfere by exercising power of judicial review even if a procedural aberration or error in assessment or prejudice to a tenderer is made out. Power of judicial review will not be invoked to protect private interest at the cost of public interest or to decide contractual disputes. Interference in tender or contractual matters in exercise of power of judicial review is permissible only if, the process adopted or decision made is mala fide or intended to favour someone or the same is so arbitrary and irrational that no responsible authority acting under law could have arrived at it or it affected the public interest. 44. In the instant case applying the above test, appreciating the facts discussed above, going through the entire materials on records including the file containing the decision making process, it cannot be said to be a case of exercise of power contrary to the set principles discussed above so as to interfere with the decision making process exercising the power of judicial review. 45. For all, aforesaid reasons, I do not find any merit in the writ petition and accordingly it is dismissed. However, there shall be no order as to costs.