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2013 DIGILAW 48 (UTT)

NEW ASIAN CONSTRUCTION COMPANY v. UJVN LTD.

2013-02-21

Sudhanshu Dhulia

body2013
JUDGMENT Hon’ble Sudhanshu Dhulia, J. (Oral) 1. Heard Mr. Vikas Soni, Advocate assisted by Mr. D. Barthwal, Advocate for the petitioner, Mr. Vinay Kumar, Advocate for the respondent no.1 and Mr. Ramji Srivastava, Advocate for the respondent no.2. 2. The petitioner is a firm registered with the Registrar of Firms. In a minor hydro-project of Uttaranchal Jal Vidyut Nigam Ltd. (hereinafter referred to as UJVNL) for the construction of hydro-project, bids were invited from eligible bidders. The petitioner was one of the participants in the said bid and so was respondent no.2. According to the petitioner, one of the essential conditions of the bid was given in 3.18 of tender notice, which reads as under:- “3.18 Specific Issues a) A prospective bidder is expected to examine all instructions terms and conditions, forms and specifications in the Bid Document and fully inform himself as to all the conditions and matters which may in any way affect the works, his bid or the cost thereof. Further, failure to furnish all information required by the bid document or submission of incomplete offers, conditional bids and bids containing commercial deviations from the bid document shall be treated as non-responsive and rejected.” 3. As per the aforesaid condition, the bidders were not supposed to give an incomplete offer or conditional offer or bids containing commercial deviations from the bid document and if they do so their bid would be considered as non-responsive and hence was to be rejected. It is admitted position before this Court that it was a two process bid, whereas the first part was of technical bid which the eligible participants had to qualify and only then the financial bids of such persons were to be opened. It is again admitted position that there were three bidders, including present petitioner and respondent no.2 and all the bidders had qualified in technical bid and subsequently financial bid was to be opened. The cost of construction given by the present petitioner was the lowest, which is to the tune of Rs.24,12,95,136/- and bid offered by respondent no.2 was to the tune of Rs.26,42,34,095/-. In other words, the petitioner was the lowest bidder and he was liable to be given the contract. The cost of construction given by the present petitioner was the lowest, which is to the tune of Rs.24,12,95,136/- and bid offered by respondent no.2 was to the tune of Rs.26,42,34,095/-. In other words, the petitioner was the lowest bidder and he was liable to be given the contract. However, this has not been done and it appears that after considering the bids, the respondent authority made the following recommendations / foot note and gave the contract to respondent no.2, which reads as under :- “a) The price has been calculated based upon the quantities as given in clause 6.27 Bill of Quantities. However as per note given at the end of BOQ on page 105 Section VI the quantities may vary up to any extent as per site condition. Thus affecting the price accordingly. As per note given it is assumed that the contractor is imposing certain conditions to his bid hence clarification was requested from the bidder vide EE (EDD-SHP) office letter no.56/EE/EDD/SHP/Limchagad/08-09 dated 04.05.2010 (Annexure-J Pg.No.56). The reply submitted by the contractor is given below and details are enclosed as per Annexure K (Pg.No.57).” 4. The petitioner alleges that bid of respondent no.2 was a conditional bid as he stated that the price which he has given in the bid would be subject to variation depending upon site condition and other factors. Subsequently, this condition was accepted by UJVNL in an office note, which reads as under :- “In the above evaluation report it has been assumed that there will be positive variation in quantities thus resulting increase in cost of work. As on date it is not possible to foresee at this stage that there will be a positive variation in quantities. In fact during actual execution the quantities may vary on either side and variation may also be on negative side. Thus cost of work based on offer of M/s EDCL may vary on either side and thus loading the bid offer for positive variations only is not reasonable. In case loading for positive variation in quantities is removed, the offer of firm M/s Energy Development Co. Ltd. (M/s EDCL) is lowest.” 5. In other words, the note was given by UJVNL to the fact that there is a possibility in a given circumstances that the actual cost of respondent no.2 may be lower than that of the petitioner. In case loading for positive variation in quantities is removed, the offer of firm M/s Energy Development Co. Ltd. (M/s EDCL) is lowest.” 5. In other words, the note was given by UJVNL to the fact that there is a possibility in a given circumstances that the actual cost of respondent no.2 may be lower than that of the petitioner. The petitioner alleges that the act of UJVNL was wrong on two grounds. Firstly, if such presumption is accepted then the bid itself become conditional and therefore the offered bid of respondent no.2 was non-responsive and was liable to be rejected. Secondly, in any case, if such condition was to be accepted i.e. “the actual cost may becoming lower”, it may happen in case of petitioner as well and therefore such contract is liable to be given to the petitioner as he is the lowest bidder. It has further been argued by learned counsel for the petitioner that as per Rule 3(9) of the Uttarakhand Procurement Rules, 2008, the negotiations shall be avoided and it further provides that it may be conducted under exceptional circumstances with lowest bidder (i.e. L-1) only and the reasons for such negotiations should be clearly recorded. Rule 3(9) of the Uttarakhand Procurement Rules, 2008 reads as under :- “(9) Negotiations shall be avoided. It may be conducted under exceptional circumstances with lowest bidder L-1 only and the reasons for such negotiations should be clearly recorded.” 6. In view of above, it is clear that the bid given by the petitioner is lowest and the contract should have been executed in his favour. On absolutely irrelevant reasoning best known to the UJVNL, a conditional bid has been accepted which is wholly arbitrary, as the bid submitted by respondent no.2 was conditional and was liable to be declared as non-responsive and was liable to be rejected. The proposal of the petitioner was to be accepted and the contract should have been executed in favour of the petitioner being the lowest bid. 7. It has also been stated by learned counsel for the petitioner that although contract has been executed in favour of respondent no.2, no effective work has been done so far. However, Mr. Vinay Kumar, learned counsel for respondent no.1 states that he has no instructions in the matter. 8. 7. It has also been stated by learned counsel for the petitioner that although contract has been executed in favour of respondent no.2, no effective work has been done so far. However, Mr. Vinay Kumar, learned counsel for respondent no.1 states that he has no instructions in the matter. 8. Learned counsel for the petitioner has fairly submitted that he would be satisfied if the contract executed in favour of respondent no.2 i.e. M/s Energy Development Company Ltd. is set aside. This being the situation, the writ petition succeeds. The impugned recommendations dated 23.05.2011 and 27.05.2011 are set aside. The impugned contract agreement dated 29.09.2011 are hereby set aside. Under these circumstances, respondent no.1 is directed to initiate proceeding afresh for construction of work in accordance with law. 9. No order as to costs.