Research › Search › Judgment

Chhattisgarh High Court · body

2013 DIGILAW 224 (CHH)

RISHABH AGENCIES v. STATE OF C. G.

2013-08-02

R.N.Chandrakar, Sunil Kumar Sinha

body2013
ORDER Shri Sunil Kumar Sinha, J. :- 1. Heard. 2. The 2nd respondent, Director of Fisheries, issued Notice Inviting Tender (NIT) for supply of 30,000 quintals of fish-food for the year 2013-14. The petitioner was one of the aspirants to submit its Tender. Condition No. 20 of the Tender conditions stipulates that the Tenderers must be experienced and financially competent to submit the Tender and they must be having a turn over of Rs.120 lakhs in selling of fish-food in anyone year in preceding 3 years. The petitioner is aggrieved by the above condition of the Tender. 3. Mr. Alok Bakshi, learned counsel appearing on behalf of the petitioner, has argued that the aforesaid condition is arbitrary and unreasonable; it eliminates the new entrants from participating in Tender, and thus, it reduces the chance of fair competition. He referred to many Circulars issued by the Central Vigilance Commission (CVC) in this regard. 4. On the other hand, Mr. A.S. Kachhawaha, learned Dy. Advocate General appearing on behalf of the respondents, has opposed these arguments and submitted that the aforesaid condition in the Tender was with intention to ensure the proper and timely supply of the fish-food and to select the person of sufficient financial capacity. The above condition is neither arbitrary nor illegal. He further added that this was not a new condition for supply of the year 2013-14, and the same was also there in the Tender Notice of the year 2012-13. 5. We have heard learned counsel for the parties. 6. In Circular dated 17th December, 2002, referred to by Mr. Bakshi, it has been mentioned that the prequalification criteria is a yard stick to allow or disallow the firms to participate in the bids. A vague definition of PQ criteria results in stalling the process of finalizing the contract or award of the contract in a non-transparent manner. It is, therefore, necessary to fix in advance the minimum qualification, experience and number of similar works of a minimum magnitude satisfactorily executed in terms of quality and period of execution. A vague definition of PQ criteria results in stalling the process of finalizing the contract or award of the contract in a non-transparent manner. It is, therefore, necessary to fix in advance the minimum qualification, experience and number of similar works of a minimum magnitude satisfactorily executed in terms of quality and period of execution. In the same Circular, it has been mentioned that for Store/Purchase contracts, Prequalification/Post Qualification shall be based entirely upon the capability and resources of prospective bidders to perform the particular contract satisfactorily, taking into account their (i) experience and past performance on similar contracts for last 2 years (ii) capabilities with respect to personnel, equipment and manufacturing facilities (iii) financial standing through latest I.T.C.C., Annual report (balance sheet and Profit & Loss Account) of last 3 years. The quantity, delivery and value requirement shall be kept in view, while fixing the PQ criteria. No bidder should be denied prequalification/post qualification for reasons unrelated to its capability and resources to successfully perform the contract. 7. In Michigan Rubber (India) Limited Vs. State of Karnataka & others, (2012) 8 SCC 216 , it was held that the basic requirement of Article 14 is fairness in action by the State and non-arbitrariness in essence and substance is the heartbeat of fair play. Fixation of a value of the tender is entirely within the purview of the executive and the Courts hardly have any role to play in this process except for striking down such action of the executive as is proved to be arbitrary or unreasonable. If the Government acts in conformity with certain healthy standards and norms such as awarding of contracts by inviting tenders, in those circumstances, the interference by courts is very limited. In the matter of formulating conditions of a tender document and awarding a contract greater latitude is required to be conceded to the State authorities. Unless the action of the tendering authority is found to be malicious and a misuse of its statutory powers, interference by courts is not warranted. In the matter of formulating conditions of a tender document and awarding a contract greater latitude is required to be conceded to the State authorities. Unless the action of the tendering authority is found to be malicious and a misuse of its statutory powers, interference by courts is not warranted. Certain preconditions or qualifications for tenders have to be laid down to ensure that the contractor has the capacity and the resources to successfully execute the work and if the State or its instrumentalities act reasonably, fairly and in public interest in awarding contract, here again, interference by court is very restrictive since no person can claim a fundamental right to carry on business with the Government. 8. In the instance case, the reason for laying down such a condition, itself is mentioned in the introductory part of the said condition No. 20. It has been mentioned that since a huge quantity of fish-food was required to be supplied in a stipulated period, therefore, the experienced bidders having sufficient financial capabilities should participate in Tender, and therefore, a condition of turn over of Rs.120 lakhs in anyone year in preceding last 3 years was being imposed. Similar is the stand of the Government through their Return dated 12.6.2013. It has been contended in para 3 of the Return that the above condition was just to ensure the proper and timely supply of fish-food. The said condition was applicable to all the participants. It has been emphasized that for supply of such a huge quantity of fish-food, a condition like the above was not only necessary, but also reasonable and proper. We further note that the above condition of the turn over of Rs.120 lakhs was not a new condition introduced for the first time in the year 2013-14. So far as the petitioner is concerned, it has no experience for supply of fish- food, as its registration for the said business itself was of April, 2012. Thus, the petitioner was not fulfilling the impugned condition No. 20. Both the counsel have agreed that the condition of turn over of Rs. 120 lakhs in a year in preceding 3 years, was also there in the purchase of 2012-13 and nobody could come forward to challenge the said condition at that stage. 9. Mr. Thus, the petitioner was not fulfilling the impugned condition No. 20. Both the counsel have agreed that the condition of turn over of Rs. 120 lakhs in a year in preceding 3 years, was also there in the purchase of 2012-13 and nobody could come forward to challenge the said condition at that stage. 9. Mr. Bakshi has argued that if such condition would prevail, no new person can enter into the business with the Government, whose registration is recent. Of course, factually it is correct, but only on this account, a condition, which otherwise does not appear to be unreasonable, cannot be struck down. Looking to the huge quantity of supply of the fish-food, which was a special category of material, and a breach in supply thereof may result into starvation of fish and affect the fish farming of the entire State, the aforesaid condition does not appear to be unreasonable, arbitrary or illegal. 10. In view of all this and in the light of above decision, we do not find any substance in the Writ Petition. The Writ Petition is liable to be dismissed and is hereby dismissed. 11. Cost made easy. HEADLINES Challenge to the conditions of the tender- Judicial Review - Scope of Discussed. Petition Dismissed.