1. The Executive Engineer, PWD (R&B) Nowshera (B.L) Respondent No.5 herein, vide Tender Notice (NABARD works) No.30 of 2008 dated 3.9.2008 invited tenders from eligible contractors for construction of five roads in Nowshera Division, including road from Kurlian to Mougla via Keri Chabbar at an estimated cost of Rs.85.00 lacs. The eligibility/prequalification criteria for an intending tenderer included "additional earnest money in shape of CDR @ 5% of the tendered amount," in case tenderer quoted depreciation @ 10% or more of SSR of 2004 (below the workable rate). Further intending contractor should have executed one similar type of work of 1/5 of magnitude of the tendered amount. In other words an intending contractor who quoted less than the workable sanctioned schedule rate was to give additional earnest money as in such cases there were more chances of the contractor leaving the work unexecuted mid way exposing the Department to avoidable loss. The petitioner as also the respondent No.6 responded to the tender notice. The contract, however, Vide order 12768-70 dated 17.12.2008 was allotted to the Respondent No.6. 2. The petitioner assails the allotment order No. 12768-70 dated 17.12.2008 on the ground that the respondent No.6 did not fulfill the eligibility/prequalification criteria set out in the tender notice in question. The respondent No.6, it is pleaded, did not enclose additional earnest money in shape of CDR @ 5% of the tendered amount with the requisite papers, though the respondent No.6 quoted depreciation @ more than 10% on SSR of 2004 (below workable rate). It is averred that the respondent No.6 did not thus fulfill the pre-qualification criteria and was not eligible even to be considered for allotment of the contract. It is insisted that only the contractor who fulfills pre-qualification criteria is eligible to be considered for allotment of the contract and the respondent No.6 having not satisfied the important prequalification criteria was not entitled to be considered for such allotment, let alone, entitled to be allotted the contract. The petitioner claims to have satisfied the eligibility/prequalification criteria and thus entitled to consideration for allotment of the contract. 3. The petitioner on the strength of averments made seeks quashment of order No. 12768-70 dated 17.12.2008 whereby contract in question has been allotted to the respondent No.6 as also a direction to the respondent to consider the allotment of contract in question in favour of the petitioner. 4.
3. The petitioner on the strength of averments made seeks quashment of order No. 12768-70 dated 17.12.2008 whereby contract in question has been allotted to the respondent No.6 as also a direction to the respondent to consider the allotment of contract in question in favour of the petitioner. 4. The respondent 1 to 5 oppose the writ petition on the ground that the rates quoted by the respondent No.6 were much lower to the rates quoted by the petitioner and thus the respondent No.6 was selected for allotment of the contract on the ground of his having quoted minimum rates as compared to other tenders. It is pleaded that the petitioner as against notified estimated cost of the contract work in question of Rs.85.00 lacs, have quoted Rs.66,75,968/- and the respondent No.6 quoted Rs.33,04,628/-. The respondent 1 to 5 while admitting that the rates quoted by the Respondent No.6 were 10 % below of SSR 2004 have avoided to reply whether the respondent No.6 enclosed additional earnest money @ 5% of the tendered amount in the shape of CDR with the requisite papers quotations. It is, however, pleaded that the respondent No.6 deposited an amount of Rs. 1,65,2311 -in shape of FDR No.003781 on 8.12.2008. 5. The respondent No.6 while admitting that the petitioner participated in the process for allotment of contract in question claims to have quoted for less rates as compared to the quotations submitted by the petitioner. It is insisted that the respondent No.6 after the contract was allotted in his favour deposited an amount of Rs.1,65,231/- in shape of FDR/CDR and that after such deposit the eligibility/prequalification criteria was satisfied, leaving non cause for the petitioner to question the allotment order. 6. Heard and considered. 7. There is agreement between parties that the Tender Notice in question amongst other eligibility/pre-qualification condition laid down condition regarding additional earnest money, where the amount quoted was 10% or more, less than sanctioned scheduled rates of 2004 or below the workable rates. It is admitted position of the parties that the respondent No.6 having given depreciation @ 10% of SSR of 2004 was in terms of eligibility/prequalification criteria required to enclosed additional earnest money in shape of CDR @ 5% of tendered amount and that such additional earnest money had not been enclosed with the tender papers. 8.
It is admitted position of the parties that the respondent No.6 having given depreciation @ 10% of SSR of 2004 was in terms of eligibility/prequalification criteria required to enclosed additional earnest money in shape of CDR @ 5% of tendered amount and that such additional earnest money had not been enclosed with the tender papers. 8. Perusal of the record available on the file reveals that an intending contractor was to deposit/enclose with the tender papers as CDR, an amount of Rs.1,75,000/-as earnest money and in the event the rates quoted were 10% or more, less than SSR of 2004 the intending contractor had to further enclose 5% of the tendered amount 'as additional earnest money in shape of FDR with the tender papers. The respondent No.6, submitted his tender papers and enclosed CDR bearing No. 1055394 on 29.9.2009 drawn on J&K Bank Nowshera in the amount of Rs.1,75,000/- as required under Tender Notice with the tender papers. The respondent No.6 having quoted his rates more than 10% below the SSR of 2004, did not enclose additional earnest @ 5% of tendered amount with the Tender Papers and failed to satisfy eligibility/pre-qualification criteria on the date he decided to compete for the contract in question. The respondent No.6 by furnishing additional earnest money @ 5% of the quoted amount in shape of FDR bearing No.003781 dated 8.12.2008 drawn on Jammu Rural Bank, Dharamsal Kalakote, more than two months after he submitted Tender Papers, could not make himself eligible for participation in the tender process when he was not qualified to even join the race. The argument advanced by Ld. Counsel for the respondents that the respondent No.6 having quoted the lowest rates, the respondent No. 1 to 5 were justified in exempting respondent No.6 from requirement of enclosing additional earnest money in shape of FDR with the tender papers, is untenable. The respondent No.6 having not satisfied the eligibility/prequalification criteria could not be made eligible by a post facto act on the part of the respondents. It is pertinent to note that the tender notice in question insisted on "enclosing" additional earnest money at the pre-qualification stage and did not leave any room for any future compliance of the eligible criteria.
The respondent No.6 having not satisfied the eligibility/prequalification criteria could not be made eligible by a post facto act on the part of the respondents. It is pertinent to note that the tender notice in question insisted on "enclosing" additional earnest money at the pre-qualification stage and did not leave any room for any future compliance of the eligible criteria. This apart the allotment of the contract in favour of the respondent No.6 when the respondent did not satisfy eligibility/prequalification criteria is discriminatory, in character and violative of Article 14 Constitution of India. In case the respondent 1 to 5 intended to relax any of the conditions laid down in eligibility/prequalification criteria, the right course for respondent 1 to 5 was to notify such relaxation and invite fresh offers from the intending contractors. The respondent 1 to 5 by opting for relaxation of the condition at the time of allotment order kept at bay the contractors who if aware of the relaxation would have participated in the tender process. The argument that the respondent No.6 having quoted the lowest amount was rightly awarded the contract in disregard of eligibility criteria is specious and bereft of any merit. It is to be pointed out that in case of allotment of work like the present one, lowest quotation is not the only criteria and may attract additional conditions like additional earnest money from the intending contractor, for allotment of the contract. Once a contractor quotes rates lower than the sanctioned scheduled rates or the workable rates the contract awarding authority is expected to stop and see whether there are chances of the contractor leaving the contract midway after getting initial incentives like "resources mobilization advance" or compromise with the quality of the work to be executed. In the present case the petitioner as is evident from comparative statement reproduced in the reply filed by the respondent 1 to 5, was the only contractor who had not quoted the rates lower than SSR of 2004 and his offer was not accorded consideration only because respondent No.6 had quoted rates on lower side though not fulfilled eligibility/prequalification criteria. 9. Viewed thus, allotment order No. 12768-70 dated 17.12.2008 is discriminatory in nature and suffers from arbitrariness.
9. Viewed thus, allotment order No. 12768-70 dated 17.12.2008 is discriminatory in nature and suffers from arbitrariness. It is well settled law that while an administrative action falling within realm of contract must not be made subject matter of judicial view, but it cannot be denied where the intending object is to prevent arbitrariness or favoritism. Reference in this regard may be made to law laid down in New Horizons Limited and another v. Union of India and others (1995) 1SCC 478 and Tata Cellular v. Union of India AIR 1996 SC 11 . The law laid down in Tej Ram v. State of J&K and others AIR 1985 J&K 63 relied upon by the Ld. Counsel for the respondents is of no help to the respondents, in as much as the facts of the reported case are distinguishable from the facts of the present case. In the case in hand unlike Tej Ram's case (supra) having regard to nature of the work to be executed, the respondent 1 to 5 laid down eligibility/pre-qualification criteria and decided to accord consideration to only the offers satisfying eligibility/pre-qualification criteria. The conditions thus was not ancillary in character but was essential to the performance of the contact. 10. For the reasons discussed above, the order No. 12768-70 dated 17.12.2008 impugned in the writ petition cannot stand legal scrutiny. The petition is accordingly allowed and the order No. 12768-70 dated 17.12.2008 is quashed. The respondent 1 to 5 are directed to re-advertise/issue a fresh tender notice and in the event they intend to relax any of the conditions laid down in the eligibility/prequalification criteria to notify their intention and also the circumstances in which such relaxation may be made, and give every one a fair chance to compete for the contract. Disposed of.