JUDGMENT A.K. Goswami, J. 1. This is an application under Article 226 of the Constitution of India by which the writ petitioner is praying for the following relief; In the premises aforesaid, it is, therefore, respectfully prayed that Your Lordships may be pleased to admit this petition, call for the records and issue a Rule calling upon the respondents to show cause as to why : (a) A writ in the nature of certiorari shall not be issued to set aside/quash the impugned decision of the respondent No. 3 in imposing new terms vide its meeting dated 17.06.2011. (Annexure-L). (b) Why a writ of mandamus should not be issued directing the respondents to consider the offer of the petitioner dated 29.04.2011 (Annexure-E) for the FOE dated 18.04.2011 dehors the impugned decision of the Technical Committee. The petitioner is a partnership firm which was established in the year 1960 and is a ISSO 9001 certified Company and the writ petitioner professes that it is one of the leading manufacturers of Diesel Engine and Pumps and its products have gained the acceptance of farmers all over the country and also enjoys a very good reputation for the design, reliability, durability and quality. The firm has a distributor in the State of Assam, namely, M/S Nikita Marketing Services Private Limited for distributing its products known under the brand name of" SWARAJ. 2. Rashtriya Krishi Vikas Yojna, for short, RKVY, and the Assam Agricultural Competitiveness Project, for short, AACP, are amongst the various schemes launched by the Central and the State Government to improve the growth of the agricultural sector and also for the welfare of the farmers. The aforementioned two schemes are envisioned to help and facilitate the farmers of Assam to irrigate their fields in the dry season by procurement of pumps and other farm equipments from a set of pre-selected products of different brands according to their choice. In the RKVY scheme, the farmers are entitled to a subsidy of 60 %, offered by the State of Assam, meaning thereby the farmers have to pay only 40 % of the price of the products. AACP is a world Bank funded scheme and in that scheme, subsidy, to the tune of 50 % is given to the farmers. 3.
In the RKVY scheme, the farmers are entitled to a subsidy of 60 %, offered by the State of Assam, meaning thereby the farmers have to pay only 40 % of the price of the products. AACP is a world Bank funded scheme and in that scheme, subsidy, to the tune of 50 % is given to the farmers. 3. In order to carry forward the scheme and to achieve the desired goal of AACP, a Notification dated 04.03.2005 was issued by the Secretary to the Government of Assam, Agriculture Department constituting a Technical Committee with the members as mentioned therein for advising on the technical issues relating to procurement of farm mechanization and irrigation component under AACP. However, over the period of time, the purview of the Technical Committee has been extended to other schemes as well including RKVY scheme. 4. In order to facilitate the procurement of pumps and other farm equipments by the farmers, the respondent No. 1 had been issuing "Floating of Enquiry", for short, FOE, inviting offers from manufacturers/companies/dealers and it has been stated by the petitioner that the petitioner had been participating in such FOE and farmers of the State of Assam in large numbers have been procuring the pumps of the petitioner. 5. On 18.04.2011, the respondent No. 1 issued an FOE to various manufacturers /companies /dealers for obtaining offers of the interested participants as per terms and conditions mentioned therein for procurement of Centrifugal Pump Sets for schemes other than AACP, on or before 07.05.2011. The petitioner had responded to the said FOE by submitting its offer on 29.04.2011. 6. Coming to learn that the Technical Committee had fixed a ceiling of price for companies which had participated in the FOE of 2010-2011 and that such ceiling was fixed at 6% of the price quoted for the same model in the year 2010-2011 and that because of such fixation of ceiling, the petitioner would not be selected for approval as the petitioner's rates had been found to be more than 6% of its rates for 2010-2011, the petitioner submitted a representation dated 07.07.2011 to the Minister, Department of Agriculture, praying for enlisting its pump sets. Recommendation was also made by the Minister, Department of Agriculture by a letter dated 27.07.2011 for enlisting the products of the petitioner. However, the petitioner did not receive any communication from the Department.
Recommendation was also made by the Minister, Department of Agriculture by a letter dated 27.07.2011 for enlisting the products of the petitioner. However, the petitioner did not receive any communication from the Department. In the meantime, the petitioner had also obtained on 17.07.2011, the approved list of short listed companies in respect of the FOE dated 18.04.2011, in which, true to its apprehension, the name of the petitioner did not figure. 7. The decision to fix the price bar of 6 % as noted herein above was taken in the meeting of the Technical Committee held on 17.06.2011 and the said decision is put to challenge in this writ petition 8. Heard Mr. N. Dutta, learned Senior counsel for the petitioner. Also heard Mr. S. Samaria, learned counsel for the respondents. 9. Mr. N. Dutta, learned Senior counsel : for the petitioner submits that in the FOE, the respondent authorities had not stipulated any condition towards fixing of any percentage or rate of increase from the 2010-2011 FOE and the respondent authorities had adopted a hidden criteria to oust the petitioner from being enlisted. Such a decision making process, cannot but be said to be grossly arbitrary and discriminatory, he submits. He has also submitted that because of such an irrational approach of the Technical Committee, though many participants who had quoted price of the same pumps corresponding to the petitioner much higher than the price quoted by the petitioner, were selected for approval, the petitioner was not approved. The learned Senior counsel also submits that the very same Technical Committee which had imposed the price bar of 6% in respect of FOE dated 18.04.2011, had not laid down any such price bar in respect of the FOE for 2011-12 for the AACP scheme and the very same models which were offered by the petitioner in respect of the FOE dated 18.04.2011 had been approved under AACP scheme. It is in this context, the learned Senior counsel submits that decision of the Technical Committee in its meeting dated 17.06.2011 resulting in the petitioner being excluded from the approved list cannot be sustained in law. He has placed reliance in the case of Md. Makrub Khan @ Md. Junu Khan Vs. Manuj Kumar Sharmah & Ors., reported in 2011 (5) GLT 746 : (2011) 3 GLR 15 and in the case of Dutta Associates Pvt. Ltd. Vs.
He has placed reliance in the case of Md. Makrub Khan @ Md. Junu Khan Vs. Manuj Kumar Sharmah & Ors., reported in 2011 (5) GLT 746 : (2011) 3 GLR 15 and in the case of Dutta Associates Pvt. Ltd. Vs. Indo Merchantiles Pvt. Ltd. & Ors, reported in 199 7 (1) SCC 53 to impress upon the Court that the entire process of selection has to be transparent, fair and open and that no criteria or procedure which is not disclosed in the FOE can be allowed to be adopted in the matter of selection or approval for the purpose of distribution of State largesse. 10. Mr. S. Samaria, learned counsel for the respondents, with reference to the affidavit-in-opposition and the additional affidavit filed by the respondents, submits that fixation of 6% of price bar was decided by the Technical Committee by taking into consideration various aspects including on the ground that maximum number of models on offer in response to the FOE was below the limit of 6% fixed by the Technical Committee, which was applicable in respect of only those who had participated in the FOE for the year 2010-2011. It is also his submission that for the new entrants a separate formula was prescribed to determine the ceiling of maximum price. He has also submitted that Clause 7 of the FOE permits the department to take the course of action that was adopted in relation to the writ petitioner. He has also taken pains to emphasize that guidelines for RKVY and AACP are different and, therefore, nothing much should be read into the approval granted to the writ petitioner in case of AACP. The decision was taken, according to him, in overall interest of the farmers. The decision making process cannot be held to be vitiated on any account, he asserts. He has also tried to justify the ceiling of 6 % as a rational one. He has contended that the Technical Committee had a further sitting on 04.01.2012 in order to discuss the issues relating to unsuccessful bidders and the Technical Committee on 04.01.2012 saw no good reason to take a view other than the one that was taken on 17.06.2011, except that it had recommended certain participants who were earlier discarded for non submission of some documents for acceptance of the Government.
He relies upon paragraph 8 in the case of Union of India & Ors. Vs. Hindustan Development Corporation & Ors., reported in (1993) 3 SCC 499, paragraph 16 of Anil Kumar Srivastava Vs. State of U.P. &Anr., reported in (2004) 8 SCC 671 , paragraph 15 of Maharashtra Rajya Sahakari Sakhar Karkhana Sangh Ltd. & Ors., reported in (1998) 4 SCC 324 as well as in the case of Meerut Development Authority Vs. Association of Management Studies & Anr., reported in (2009) 6 SCC 171 to fortify his submission that this is not a case where this Court should interfere with the decision making process. 11. Before this Court proceeds to consider the merits of the submission of the learned counsel for the parties, it will be appropriate to extract relevant Clauses of the FOE dated 18.04.2011. For the purpose of this case, Clauses 2, 7 and Clause 8.3 under the heading "terms and conditions" are reproduced herein below : 2. Equipments will be procured by ASGs/Farmers, over a period of time, as per their choice from the short listed brands/models, out of the short listed list of manufactures to be published by the Director of Agriculture, Assam, following completion of evaluation of offers received in response to this FOE. This exercise is carried out as a facilitation service to ASGs/Farmers for ensuring products that meets acceptable standards are procured at reasonable prices. While evaluating the offers received, the rates accepted in the previous years, prevailing rate of products of various companies (for similar products) in the market will also be kept in mind. 7. The Department is not bound to recommend the lowest rate or any other rate so offered. Also the Department reserves the right to accept or reject in public interest any or all of the offers received from the companies/manufactures/dealers, etc and to cancel the FOE process and reject any or all offers, at any time even during the operation of this FOE, without any liability or any obligation to inform the affected Bidder or Bidders of the grounds for the decision of the department. 8.3. All offers against this FOE shall be in English language. Offers should comprise the following, duly filled stamped & signed at every page by an authorized person of the manufacturer. (a) Manufacturers' covering letter of the offer.
8.3. All offers against this FOE shall be in English language. Offers should comprise the following, duly filled stamped & signed at every page by an authorized person of the manufacturer. (a) Manufacturers' covering letter of the offer. (b) Clause-by-Clause by Commentary to the laid down terms & conditions and Technical specifications indicating deviations alongwith supporting Technical Brochures, Leaflets. (c) Qualifications for eligibility have been prescribed in a subsequent clause under the title of "Qualification Requirements". The participants must submit required information along with certified copies of supporting documents. (d) Price Schedule: Price of the individual model of the Pump sets, including all accessories, taxes, duties, transportation cost, etc. must be quoted strictly as per the following format:-SI. Brief descriptive- Rate per Taxes Total Rate on of the Items Unit Rs. per unit with Brand Rs. Inclusive Model and of taxes specification (c + d) a b c d e 12. For better appreciation, the minutes of the meeting of the Technical Committee held on 17.06.2011 for evaluation of FOE etc. for short listing models, brands and price etc. of diesel and electrical run pump sets of Shallow Tube Well (STWP/Low Lift Pump (LLP) for farmer's choice under various Agriculture Department schemes other than AACP for the year 2011-12 needs to be reproduced in its entirety : A meeting of Technical Committee was held on 24.05.2011 at 3:00 P.M. under the Chairmanship of Sri. R.T. Jindal, IAS, Agriculture Production Commissioner and Principal Secretary to Government of Assam, in his office chamber at Dispur, Guwahati for evaluation of the FOE invited vide Agriculture Directorate No. Agri/Engg/FOE-Pump/3468/2011-12 dated 18.04.2011 for Diesel/Electrical run Pump Sets of STW and LLP to be procured on the basis of farmer's choice under various schemes of Agriculture Department, Assam other than AACP for the year 2011-2012. In its first meeting on 24.05.2011, the Committee studied the technical and commercial information provided by various Companies/dealers etc. Further the Committee examined the rates offered by various Companies/Dealers in response to this FOE vis-a-vis the rates approved under previous FOE of the Department and the percentage variation etc. as per data furnished by the Chief Engineer Agriculture. It was noticed that the increase in prices offered by the Companies (Which participated in FOE for 2010-2011) also varied from 0% to 48.11 %. The Committee felt that the prices offered by some of the Companies appeared to be unreasonable.
as per data furnished by the Chief Engineer Agriculture. It was noticed that the increase in prices offered by the Companies (Which participated in FOE for 2010-2011) also varied from 0% to 48.11 %. The Committee felt that the prices offered by some of the Companies appeared to be unreasonable. The Committee after scrutiny of the documents of the FOE and after thread bare discussion decided the following : (a) Increase in the rate of various brands/Models of STW/LLP (both diesel & electrical) which have participated both in 2010-2011 & in the instant FOE for 2011-12, is fixed at 6 % over the approved price of last year or the price quoted in the instant FOE against each Model/Brand, whichever is less, provided the Models/Brands are technically and commercially responsive. Rates higher than 6 % over last year in respect of any Brand/Model are not recommended. (b) The maximum price amongst STW/LLP Pump Sets qualified in (a) above will be the upper ceiling for the new Brands/Models which have participated in the instant FOE for 2011-12 afresh, provided the new Brands/Models are technically and commercially responsive. (c) The offers be analyzed from the technical & commercial point of view and responsive offers be re-verified. (d) Model wise and brand wise rates and other particulars be analyzed thereafter. Accordingly an exercise was made for (a) above and the ceiling of maximum price for different categories' of pumps were calculated as below : (a) Ceiling of price in the instant FOE for the models of STW/LLP Pump set which participated in the last FOE for 2010-11 are as below : S. No. Categories Ceiling of rate for STW Ceiling of rate for Pump Set 1. 5 HP (Diesel) Heavy weight Rs. 29,951.00 Rs. 31,841.00 2. 5 HP (Diesel) Light Weight Rs. 29,190.00 Rs. 30,450.00 3. 4.5 HP (Diesel) No model qualified. Only one approved model of last year is available in the instant FOE and price increase of which is more than ceiling limit of 6%. 4. 4 HP (Diesel) Rs. 19,730.00 No models qualified. Only one model approved last year Which has come in the instant FOE and price increase of which is more than ceiling limit of 6% 5. 2 HP (Electrical) Rs. 11,393.00 Rs. 13,461.00 6. 3 HP (Electrical) No model qualified.
4. 4 HP (Diesel) Rs. 19,730.00 No models qualified. Only one model approved last year Which has come in the instant FOE and price increase of which is more than ceiling limit of 6% 5. 2 HP (Electrical) Rs. 11,393.00 Rs. 13,461.00 6. 3 HP (Electrical) No model qualified. Only one model approved last year is available in the instant FOE and price increase of which is more than ceiling limit of 6%. Rs. 15,477.00 (b) The ceiling for maximum price is fixed for New Brands/Models for FOE 11-12 as under : S. No. Categories Ceiling STW Pump Ceiling LLP Pump Set 1. 5 HP (Diesel) Heavy Weight Rs. 29,951.00 Rs. 31,841.00 2. 5 HP (Diesel) Rs. 29,190.00 Rs. 30,450.00 3. 4.5 HP (Diesel) Rs. 25,467.00 (by adding 6% on the model approved last year) Rs. 26,590.00 (by adding 6% on the model approved last year) 4. 4 HP (Diesel) Rs. 19,730.00 Rs. 21,147.00 (by adding 6% on the only model approved last year) 5. 2 HP (Electrical Rs. 11,393.00) Rs. 13,461.00 6. 3 HP (Electrical Rs. 13,356.00) (by adding on the only Model approved last year) Rs. 15,477.00 (c) The offers were analyzed in details for offered price, commercially & technically in Annexure-ii, iii & iv respectively and Summarized in the comparative statement at Annexure-1. (d) Thereafter, the committee took up model wise and brand wise particulars and made its recommendations as recorded in Annexure-1. As regards subsidy on pump sets for STW/LLP, the Committee noted that the subsidy approved by Government under respective schemes shall be applied. The meeting is ended with vote of thanks from the Chair.. 13. From the aforesaid minutes of the meeting of the Technical Committee, it appears that for participants who had participated in the FOE of 2010-11 as well as FOE 2011-12, rates higher than 6 % over last year in respect of any brands/models were not recommended. In other words, a participant who had quoted say, Rs. 100/-, for 2010-2011 for product 'X' and in 2011-2012, if he had quoted for the same item more than Rs. 106/-, in terms of the above principle enunciated by the Technical Committee, he would not be recommended. For the same item 'X', say, the highest approved rate in 2010-2011 was Rs. 200-. According to the principles laid down, the ceiling of rate for 2011-12 for product 'X' would be Rs. 200/-+ 6% of Rs.
106/-, in terms of the above principle enunciated by the Technical Committee, he would not be recommended. For the same item 'X', say, the highest approved rate in 2010-2011 was Rs. 200-. According to the principles laid down, the ceiling of rate for 2011-12 for product 'X' would be Rs. 200/-+ 6% of Rs. 200/- - Rs. 212/-. The ceiling for maximum price for new entrants would be Rs. 212/-. A participant who had quoted Rs. 100/- in the previous FOE would not be recommended if he quotes even Rs. 107/-, for 2011-12, but for the same product, a new entrant would be recommended even if the rate quoted is Rs. 212/-. Likewise, the participant who had offered Rs. 200/- for 2010-11 would be recommended if his bid in 2011-12 docs not exceed Rs. 212/- 14. The writ petitioner, in paragraph 19 of the writ petition has categorically asserted that none of the models of the petitioner exceeded the ceiling rate of fixed by the Technical Committee and that all the models of the petitioner are much cheaper than the ceiling limit fixed by the Technical Committee. The respondents in paragraph 8 of the affidavit-in-opposition has not denied the aforesaid assertion of the writ petitioner and have relied on Clause 7 of the FOE to contend that the department is not bound to recommend the lower rate or any other rate so offered and the department reserved the right to accept or reject in public interest any or all the offers received from the Companies/Manufacturers/Dealers. In the affidavit-in-reply, it has been asserted that the models of the petitioner are approximately 6.88 % less than the ceiling price imposed on various models by the respondent authorities. It has also been stated that the price of model of the petitioner in heavy weight category is less than all the eight models for LLP pumps and in case of STW pumps, less than five of the models selected and at par with the remaining three models. In case of 5 HP Light Weight category, the price was less than ten models in case of LLP and 9 in case of STW, out of the total seventeen models selected.
In case of 5 HP Light Weight category, the price was less than ten models in case of LLP and 9 in case of STW, out of the total seventeen models selected. The assertion of the petitioner in the affidavit-in-reply has not been disputed in the additional affidavit-in-opposition filed by the respondents subsequent to the filing of the affidavit-in-reply or during the course of arguments by the learned counsel for the respondents. 15. The idea of FOE as it appears is to enable farmers to procure pump set as per their choice from the shortlisted brands/models which are approved by the Director of Agriculture and the exercise is carried out as a facilitation service to Agriculture Service Groups (ASG) and farmers for ensuring that products meet acceptable standards and are procured at reasonable price. The whole idea seems to be to enable the ASG/Farmers to exercise a conscious choice of purchase from the products which are of acceptable standard and which are approved. 16. In the FOE dated 18.04.2011, it has been provided that while evaluating the offers received, the rates accepted in the previous year, rates of products of various companies for similar products in the markets would also be kept in mind. No such stipulation as has been devised by the Technical Committee was included in the FOE. It is also important to note that the fixing of ceiling of 6% above last year's rate was decided after the offers had been submitted and they were opened. 17. The present is not a case of notice inviting tender (NIT) but had arisen from an FOE. In the matter of distribution of state largesse, principles underlying in both the NIT and FOE remain the same and the consideration which should guide the Government in acceptance of a tender received and the procedure to be followed, would also apply in a case falling under FOE. 18. In Dutta Associates Pvt. Ltd. (Supra), the Apex Court made the following observation : We reiterate that whatever procedure the Government proposes to follow in accepting the tender must be clearly stated in the tender notice. The consideration of the tender received and the procedure to be followed in the matter of acceptance of a tender should be transparent, fair and open. 19.
The consideration of the tender received and the procedure to be followed in the matter of acceptance of a tender should be transparent, fair and open. 19. Following the aforesaid dicta of the Apex Court in Dutta Associates Pvt. Ltd. (supra), a Division Bench of this Court in Md. Makrub Khan & Ors. (supra) had stated thus : 14. In the present case, there is no dispute that NIT did not contain any condition that the authorities would consider the viability or suitability of the tenderer in accepting the tender for settlement. Further, it would appear that only after opening of the tender, in the comparative statement of tenders, it was commented that the bid of the writ petitioner/respondent No. 1 is exorbitant and speculative and found to be more than 75 % of the last year's bid. The materials on record also do not demonstrate that any prior decision before opening of the tenders was taken with regard to what, according to the Board, is viable and suitable rate. We express no opinion as to whether such a course would have been permissible or not, as such an issue has not fallen for our consideration while deciding the present appeal. 15. Permitting to adopt a hidden criteria in the matter of settlement of contract is fraught with grave danger and the same is an anathema to the concept of transparency, openness and fairness, which had to be scrupulously observed in the matter of distribution of State largesse". 20. In the case of Hindustan Development Corporation and Others (Supra), three big suppliers had quoted an identical price of Rs. 77,666/- which was lower than the updated price of the previous contract and the Tender Committee had formed an opinion that these three tenderers had formed a cartel and accordingly, had arrived at a figure which was considered to be-reasonable price at which counter offer could be made. The post tender offer of two of the big manufacturers confirmed the stand of the authorities regarding formation of a cartel and it is in these circumstances, the authorities had decided on a dual pricing. The facts of Hindustan Development Corporation & Ors. (supra) are not applicable in the case in hand and, therefore, the reliance placed by Mr.
The post tender offer of two of the big manufacturers confirmed the stand of the authorities regarding formation of a cartel and it is in these circumstances, the authorities had decided on a dual pricing. The facts of Hindustan Development Corporation & Ors. (supra) are not applicable in the case in hand and, therefore, the reliance placed by Mr. S. Samaria on paragraph 8 to suggest that Tender Committee may evolve its own procedure and also fix a rate or reasonable price is not attracted in the facts of the case. 21. Maharashtra Rajya (supra) is a case where the Apex Court was considering an amendment of Maharastra Sugar Factory (Reservation of Areas and Regulation of Crushing and Sugarcane Supply Order), 1984 on the ground that the State Government being a delegatee of the Central Government in terms of a Notification issued cannot pass an order inconsistent with Sugarcane Control Order of 1996 passed by the Central Government. No doubt, paragraph 15 of Maharashtra Rajya (supra) deals with aspects relating to protection of interest of farmers but the issue raised in the present petition does not have even a remote connection with the issues raised in Maharashtra Rajya (supra) and the Court fails to fathom as to why the said judgment has been pressed into service by the learned counsel for the respondents. 22. In Anil Kumar Srivastava (supra), the Supreme Court had examined the concepts of reserve price, upset price, etc. Paragraph 16, on which the learned counsel for the respondents placed reliance, goes to show that the Financial Committee had recommended the acceptance of the bid of the respondent No. 3 who was the sole bidder, keeping in mind prior experience and the terms and conditions of a resolution dated 10.07.2003 in the matter of sector price and reservation price. 23. In Meerut Development Authority (supra) at paragraphs 28 and 29, the Supreme Court stated thus : 28. It is so well settled in law and needs no restatement at our hands that disposal of the public property by the State or its instrumentalities 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 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. 24. In a welfare state, the authority owes a duty to act fairly. In judicial review, the Court is concerned with the manner in which a decision is taken and an order is made and, therefore, the Court can examine whether the decision making process is reasonable, rational, not arbitrary and violative of Article 14 of the Constitution of India. Bearing in mind the principles as laid down by the Apex Court in the cases as noted herein above, it would appear that whatever procedure the Government proposes to follow must be clearly stated in the FOE. There was no stipulation in the FOE that the Technical Committee could fix a ceiling of 6% above last year's offer after opening of offers. FOE did not permit the Technical Committee to adopt the criteria of 6 % above the offer of the last year as a ground for not recommending a bidder even though such a rate is lower than the rates of many other bidders. 25. In view of the discussions above, the decision of the Technical Committee dated 17.06.2011 not to recommend rates higher than 6% over last year in respect of any Brand/Model cannot be sustained. 26. The writ petition is allowed. The respondents are now directed to consider the offer of the petitioner dated 29.04.2011 for the FOE dated 18.04.2011 in the light of the discussions above. No costs. Petition allowed.