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Madhya Pradesh High Court · body

2013 DIGILAW 931 (MP)

Rosemerta Technologies Ltd. v. State of M. P.

2013-08-07

RAJENDRA MENON, VIMLA JAIN

body2013
Judgment: 1. Challenging the process initiated by the State of Madhya Pradesh in the Transport Department for selection of vendors for implementation, upgradation and maintenance of various services, Delivery Systems on Build, Own, operate and transfer (BOOT) basis for the I.T. Services this petition has been filed. Petitioner Company is challenging the tender process initiated vide document Annexure P-1 dated 8.3.13 and subsequent corrigendum issued to the same on 25/3/2013. It is a case of the petitioner which is a Company incorporated in the year 2006 and registered under provisions of Companies Act, 1956, that the terms and conditions for selection of vendors for the purpose of implementation, upgradation for the service in question is tailor made to suit the existing vendor particularly respondent No. 3 and is a process which is unconstitutional and arbitrarily, devised to some how oust the competitors like petitioner. Contending that certain condition imposed in the tender document Annexure P -1 dated 8.3.2013 are violative of Article 14 and 19(1)(g) of the Constitution, this writ petition has been filed. 2. According to the petitioner company they are actively involved in developing solutions and providing management facility for the purpose of Smart Card preparation in the Transport Department for various State Government departments so also for the purposes of security purpose, maintenance of land records etc. It is stated that the company has established various software's and has requisite manpower and technical know-how for carrying out the work for which the tender was invited. It is stated that the Company has I.S.O. 9000 certificate which has been accredited due to its quality service. It is the case of the petitioner that the Government of Madhya Pradesh in the Transport Department initiated certain process for the purpose of selection of vendors for implementation, upgradation and maintenance of various services delivery systems on Build, Own, Operate and Transfer (BOOT) basis for the period of 5 years which was extended further for the period of 5 years. 3. It is stated that on 27/12/12 the Transport Commissioner issued the tender/proposal for the work in question. The petitioner made representation to the respondent raising objections with regard to certain conditions stipulated in this tender. 3. It is stated that on 27/12/12 the Transport Commissioner issued the tender/proposal for the work in question. The petitioner made representation to the respondent raising objections with regard to certain conditions stipulated in this tender. It is said by the petitioner that taking note of the objections of the petitioner this tender process was cancelled without specifying any reasons but thereafter another advertisement/proposal, impugned in this writ petition was issued on 8/3/13 for the work in question. When the same was issued on 8/3/13 the petitioner made representation to the respondent No. 2 raising certain queries and made certain suggestions and highlighted certain points with regard to tender issued on 8/3/13 vide Annexure P -1. Representation in this regard is Annexure P-3. It is said that after this representation was submitted a corrigendum was issued vide P-2 on 26/3/13. Further queries and suggestions of the petitioner was not addressed to and instead the Government continued with the process of tender. The process of tender has been finalized and as certain conditions which were incorporated in the tender issued on 8.3.13 are said to be arbitrary, illegal and as their representations did not yield any result, the petitioner is said to have filed this writ petition. According to the petitioner various pre-qualifications criteria contemplated in Clause-7 of the tender document are unreasonable, arbitrary in nature and as they are tailor made to suit certain vendors and therefore challenge is made to the entire process on the ground that these conditions are unsustainable. Clause 7 of the pre-qualification which are assailed by the petitioner are sub-clauses 4, 6, 8, 9 and 11 and for the sake for convenience the same are reproduced herein under - 7(4) The bidder/lead bidder in the case of consortium must have average annual sales turnover of Rs. 300 Crore in of the last three consecutive financial years i.e., 2009-10, 2010-11 and 2011-12 in the I.T. related activities or services, or in the field of providing Smart Card sales and enabled services. Sales in activities or fields other than as mentioned herein will not be accounted for this turnover criterion. 300 Crore in of the last three consecutive financial years i.e., 2009-10, 2010-11 and 2011-12 in the I.T. related activities or services, or in the field of providing Smart Card sales and enabled services. Sales in activities or fields other than as mentioned herein will not be accounted for this turnover criterion. A copy of the consolidated audited balance sheet of the organization for the last three financial years (2009-10, 2010-11 and 2011-12) should be submitted along with the bid, in case the audited annual report does not explicitly mention the percentage of I.T. services, an Auditor's certificate certifying the annual sales turnover of Rs. 300 Crore in the I.T. related activities or services, of in the field of providing Smart Services must be submitted by the bidder. In case of a consortium, the consortium partner (other than lead bidder) should have a average turnover of Rs. 10 Crore in the last 3 (three) financial years (2009 -10, 2010-11 and 2011-12). 7(6) The bidder/lead partner in case of consortium should have minimum 500 employees on its payrolls as on 01 December 2012. A self certificate to this effect duly signed by the Company Secretary or Director of Company should be submitted with the bid along with latest 3 months Provident Fund payment challan confirming the fact of minimum 500 employees, without mention of the names of the employees but must include the number of employees on the challan of Provident Fund. 7(8) The bidder/any of the partners in case of consortium must have manufacturing experience or have supplied at least 5 million (50 Lacs) SCOSTA cards to any of the e-governance programs for issuance of smart card based ID documents in India in the last 3 financial years (2009-12). A job completion/satisfactorily working certificate issued by the client(s) authorized Officer must be submitted. 7(9) The bidder/lead bidder in case of consortiums must possess quality certification PCI CMMI level 3 certification or higher. A self attested copy of the valid certificate on the date of bid submission should be attached with the bid. 7(11) The bidder/any of the partners in case of consortium should have an experience in developing, creating and managing of Data Centers for an e -Governance project/application of any Central Government Ministry or State Government department, through the bidder with experience in a State Transport Department would be given the preference. 7(11) The bidder/any of the partners in case of consortium should have an experience in developing, creating and managing of Data Centers for an e -Governance project/application of any Central Government Ministry or State Government department, through the bidder with experience in a State Transport Department would be given the preference. The vendor needs to give a self declaration that on award of the contract, the vendor would get the date centre I.S.O. 27001:2005 certified within 6 months of award of contract. 4. Shri Brian D'Silva, learned senior Advocate at the very outset invited our attention to the definition of Smart Card as provided under Rule 4(5) of the Central Motor Vehicle Rules 1989 and argued that certain condition of the tender particularly Clause-9 is contrary to the requirements of the statute and therefore is unsustainable. By filing various documents alongwith tow applications and additional affidavits, being I.A. No. 6653/13 and I.A. No. 5407/13, the first objection raised was that condition No. 7(4) which contemplated a provision for the bidder in case of consortium to have annual turnover of Rs. 300 crores for the last 3 consecutive years up to 2011-12. Further requirement of the said clause that lead bidder should have average turn over up to Rs. 10 Crores for the financial year is arbitrary and unjust condition, it was emphasized that Clause 7(4) is tailor made to suit respondent No. 3 and it is not at all a reasonable decision. It is said that by prescribing a annual turnover as high as Rs. 300 Crores for the last 3 financial year many eligible vendors like the petitioners are ousted from the competition. Thus, according to learned Senior counsel it is a device to favour someone like respondent No. 3. Referring to certain documents filed alongwith I.A. No. 6653/13 it is stated that tenders for similar work issued by the Government's of Goa, Gujarat and Haryana show that the turnover fixed in these states was ranging from 20-50 crores. Thus, according to learned Senior counsel it is a device to favour someone like respondent No. 3. Referring to certain documents filed alongwith I.A. No. 6653/13 it is stated that tenders for similar work issued by the Government's of Goa, Gujarat and Haryana show that the turnover fixed in these states was ranging from 20-50 crores. Learned Senior Counsel therefore argued that a turnover of 300 crores fixed by State Government in the present case is highly excessive and arbitrary and looking to the reasons and justifications given by the State Government for fixing such a higher turnover he submits that the same are not correct accordingly challenge is made to the aforesaid condition mainly on the ground that prescribing such a high turnover which is not required for in the contact like the present, the State government has acted in an arbitrary manner violating all norms of law and justice. 5. It was thereafter argued with regard to Clause 7(6) that the petitioner has a work force of more than 1000 persons. But petitioner is not qualified under this category because Provident fund payment challan for all the workers may not be available. It is said that the condition with regard to submission of Provident Fund Account or submission of Provident Fund challan is unnecessary and a arbitrary decision. Thereafter referring to Clause 7 (9) and inviting our attention towards Rule 4(s) of the Central Motor Vehicle Act, 1989 Shri Brian D'Silva, Senior Counsel argued that imposing the conditions with regard to consortium having quality certification by PCI CMMI level 3 certification or higher is an arbitrary condition contrary to the requirement of Rule 4(s) of the Central Motor Vehicle Act, 1989, therefore, it is unsustainable. 6. Further reference is made to clause 7(11) to say that the condition of working experience in providing centralized e-governance, web based solution to the Central Government and State Government Department is also arbitrary. It is said that a vendor like the petitioner who has experience of working with, a private establishment should also be considered and keeping them out of consideration is nothing but a arbitrary decision. Finally referring to sub Clause-7(11) arguments advanced is that experience gained by working with private establishment should also, be counted. Insisting upon having experience with a Government Department is nothing but a-arbitrary decision. Finally referring to sub Clause-7(11) arguments advanced is that experience gained by working with private establishment should also, be counted. Insisting upon having experience with a Government Department is nothing but a-arbitrary decision. Taking us through the pleading in this regard filed by the parties, the justifications, given by the State government and reasons for the conditions imposed Shri Brian D'Silva learned senior counsel emphasized that these conditions are not at all warranted they are unreasonable and therefore, the same be held as arbitrary, quashed and the entire process re-tendered. 7. Placing reliance on the following judgments Gade Venkateswara Rao v. Government of Andhra Pradesh, AIR 1966 SC 828 ; Rashbihari Panda v. State of Orissa, 1969 (3) SCR 375 : AIR 1969 SC 1081 ; Kasturi Lal Lakshmi Reddy v. State of J & K, (1980) 4 SCC 1 : Sterling Computers Limited v. M.N. Publications Limited 1993 (1) SCC 445 ; Erusian Equipment and Chemicals Limited v. State of West Bengali 197S (1) 5CC 70; L.D.A. v. M.K. Gupta, 1994 (1) SCC 243 ; and Tata Cellular v. Union of India, 1994 (6) SCC 651 . Shri Brian D'Silva argued that action of the State Government is highly improper and cannot be sustained. Shri D'Silva invited our attention to the judgment rendered by the:. SUPREME COURT in the case of Ramana Dayaram Shetty v. The International. Airport, 1979 AIR 1628 and tried to emphasize that the decisions taken for awarding the contract based on such unreasonable and arbitrary conditions are unsustainable took us through various judgments as referred to hereinabove to say that the provisions are arbitrary and tailor made to give undue benefits to vendors like respondent No. 3. Finally referring to para 51 of the judgment rendered by SUPREME COURT in the case of Shimnit Utsch India Private Ltd., and another v. West Bengal Transport Infrastructure Development Corporation Ltd. and others 2010 6 SCC 30 be argued that in the facts and circumstances of the case, petition be allowed and interference be made. 8. Rebutting the aforesaid contention Shri P.K. Kaurav, Additional Advocate General raised a preliminary objections with regard to locus standi of the petitioner for filing this writ petition. 8. Rebutting the aforesaid contention Shri P.K. Kaurav, Additional Advocate General raised a preliminary objections with regard to locus standi of the petitioner for filing this writ petition. It was submitted by him that initially when the proposal inviting tender was issued on 27/12/12 the petitioner did make certain representations/objections to show that they wanted to participate in the proceedings but thereafter when the final proposal was published on 8.3.13 one of the conditions that was required to be fulfilled was of submitting a Demand Draft of Rs. 1.00 lacs and purchase of the tender documents which were available in the website/office. It is said that after the notification was issued on 8.3.13 petitioners submitted certain queries on 13.3.13. Thereafter a corrigendum was issued on 15/3/13 and petitioner again sent a e-mail making same queries. They did not prepare the demand Draft for Rs. 1.00 Lac. Demand Draft was to be sent by 19/3/13. A pre-bid conference with regard to discussion on the proposal was to be held but the petitioner did not submit the Demand Draft for Rs. 1.00 Lac nor did he purchase the tender document and, therefore, they were not permitted to participate in the pre-bid conference. It is stated that without purchasing the tender documents and without participating in the pre-bid conference petitioner has directly filed this writ petition and therefore, as petitioner is not a party to the process of tendering, it has no locus standi to file this writ petition. The apart, Shri Kaurav pointed out that the State of Madhya Pradesh has been implementing information technology in various projects and departments since the year 2002 and for the last more than 11 years the State and in particular the Transport department has achieved great heights in implementing information technology in various projects and departments since the year 2002 and for the last more than 11 year the State and in particular the Transport department has achieved great heights in implementing its information technology for various project. It was for enhancing the technology and for more usage of the information technology, that after proper consultation and expert opinion from the M.P. State Electricity Development Corporation and after various deliberations with experts, proposal was initiated for issuing the work in question. It was for enhancing the technology and for more usage of the information technology, that after proper consultation and expert opinion from the M.P. State Electricity Development Corporation and after various deliberations with experts, proposal was initiated for issuing the work in question. The work for which the offer was invited was not only for issuance of Smart cards based driving licencing or registration certificate, the work which was to be given to the vendor consisted of more than 19 personalized service which are detailed in para 6 of the reply filed by the State. This included collection of revenue for the Transport Department, payment of taxes/fees online on 24 x 7 basis. Setting up of more than 57 public outlets, management of information system and the entire project was based on a BOOT policy. Apart from providing infrastructure and manpower required so also technical know how the vendor was required to develop the site by providing proper furniture, fixtures, electrical fitting and all other services. It was said that project was of great magnitude. Approximate revenue collection through this project would be Rs. 1500 Crore per annum and when the project was of such magnitude a specific condition with regard to turnover, manpower, requisite certification with regard of software etc. was insisted upon. 9. Shri Kaurav took us through the justifications given by State Government for insisting upon all these requirements and submitted that based on the magnitude of work, its financial implications, security, requirements and considering the nature of technology required, specific terms and conditions has been fixed after due deliberation, opinion and approval from the technical experts and until and unless the said conditions are found to be arbitrary, unreasonable or contrary to law, interference by this court is not called for. He invites our attention to the judgment rendered by the SUPREME COURT in the case of Directorate of Education and others v. Educomp Datamatics Ltd. And others AIR 2004 SC 1962 and the observations made in para 12 and argued that this court will not interfere with a administrative policy decision until and unless it is found to be arbitrary, discriminatory and malafide or contrary to statutory requirement. He submitted that the condition imposed for the contract in question are reasonable based on proper consideration and the contention of the petitioner that they are arbitrary or tailor made to suit respondent No. 3 is denied. He submitted that the condition imposed for the contract in question are reasonable based on proper consideration and the contention of the petitioner that they are arbitrary or tailor made to suit respondent No. 3 is denied. Finally referring to the judgment of SUPREME COURT in the case of Jagdish Mandal v. State of Orissa 2007 14 SC 517 Shri Kaurav submitted that power of judicial review cannot be permitted to be invoked to protect private interest at the cost of public interest and submitted that the conditions are proper and are made after taking note of the requirements of the work. Merley because petitioner has been excluded from consideration interference cannot be made. 10. Shri Vivek Tankha, Learned Senior Advocate adopted the arguments advanced by Shri P.K. Kaurav and took us through the conditions, requirements of law as laid done by the SUPREME COURT and thereafter referred to each and every conditions, points of challenge made by the petitioner, requirement of the project in detail to emphasize that the conditions are reasonable they are neither arbitrary nor unreasonable and looking to the magnitude of the work, security and financial consideration etc. a policy decision of the State Government which is based on expert opinion and technical consideration need not be interfered with. With regard to conditions of the bidder having PCI CM level 3 certification Shri Tankha submitted that this condition is required with regard to maintenance of certain software standards. It was submitted that the scope of work in question requires very high standard of software for maintenance of the service, revenue collection involved is very high, aspects of safety and security of the public have to be considered by the State Government and therefore, a software of high standard is required. He submits that I.S.O. certification or certification referred in the statutory rules of Central Motor Vehicle Rules is not a certification with regard to the standard of a software required. I.S.O. certificate is a certificate which is of a general nature, but if for a work of such a magnitude a specialized high expertise on software requirement is insisted upon looking to the public safety, revenue collection etc., the condition cannot be termed as unreasonable, the same cannot be termed to be arbitrary or illegal in any manner whatsoever. I.S.O. certificate is a certificate which is of a general nature, but if for a work of such a magnitude a specialized high expertise on software requirement is insisted upon looking to the public safety, revenue collection etc., the condition cannot be termed as unreasonable, the same cannot be termed to be arbitrary or illegal in any manner whatsoever. That apart, with regard to disparity pointed out by the petitioner with regard to turnover being very high and the turnover fixed by certain other States, referred to by petitioner vide I.A. No. 6653/13 i.e., the State of Gujarat, Haryana and Goa it was pointed out that this was for the year 2007 and 2009, now the position has changed in they year 2013 and looking to the specific nature of work in the current year 2013, State of M.P. has insisted upon a particular condition, the same cannot be interfered by this court until and unless it is shown to be in violation of the statutory rules or regulations or a arbitrary policy decision of the State Government. 11. Reference has been made to a recent judgment in W.P. 8815/13 M/s. Kutch Brine Chemical Industries v. State of M.P. dated 22/7/13 to say that every Sate has certain requirements and policy therefore if conditions are imposed by each State depending on various factors, then on the ground of a different condition being imposed by some other States condition cannot be termed to be discriminatory or arbitrary. Shri Tankha, learned Senior counsel submitted that the decision taken in the facts and circumstances of the case is proper, the decision itself cannot be subjected to judicial review, it is only the decision making process which can be examined by the court in exercise of its limited scope of judicial review and once the decision making process is found to be proper and in accordance with law, no further interference is called for. In support of his contention he has also placed reliance on the judgment of Jagdish Mandal (supra) on which reliance was placed by Shri P.K. Kaurav. In support of his contention he has also placed reliance on the judgment of Jagdish Mandal (supra) on which reliance was placed by Shri P.K. Kaurav. That apart he has also placed reliance upon the following judgments: Raunaq International Ltd. v. I.V.R. Construction Ltd.) (1999) 1 SCC 492 , AIR India Ltd. v. Cochin International Airport Ltd., (2000) SCC 617, Michigan Rubber (I) Ltd. v. State of Karnataka and others 2012 (8) SCC 216 and submitted that if the policy decision taken by the Government is based on proper consideration and if the decision is in accordance to the requirements of the project and it is not tainted with malafide then it is not amenable to judicial review. It was argued that pre-qualification and precondition of the tender are laid down to ensure certain standards to be maintained for the work to be done and when no public interest is involved, interference is not called for. Shri Tankha submitted that in. the facts and circumstances of the case petition is wholly misconceived and be dismissed. 12. Shri Raghvendra Singh, Learned counsel for respondent No. 4 apart from adopting the arguments advanced by learned counsel for the other two respondents took us through the judgment rendered by the SUPREME COURT in the case of Michigan Rubber (I) Ltd. (supra) to say as to what are the principles for judicial review in such cases and prays for dismissal of the Writ Petition. 13. Shri Brian D'Silva, learned senior counsel in rejoinder submitted that petitioner has a right to challenge the arbitrary condition, imposed in the proposal and for that it is not necessary for him submit the tender and thereafter challenge the condition. Referring to para 27 of the judgment rendered by the SUPREME COURT in the, case of R.D. Shetty (supra) Shri Brian D'Silva argued that petitioner has locus standi to file this petition as irrational and arbitrary decision is taken and certain conditions were formulated in a tailor made manner, only to suit existing contractor like respondent No. 3 which is again is unsustainable. 14. We have heard the learned counsel, for the parties at length and perused the record. We are conscious of the scope of judicial review, the limitations with regard to the scope of judicial review into, such matters, therefore we shall proceed to consider the matter in the backdrop of these principles. 14. We have heard the learned counsel, for the parties at length and perused the record. We are conscious of the scope of judicial review, the limitations with regard to the scope of judicial review into, such matters, therefore we shall proceed to consider the matter in the backdrop of these principles. That apart, it is important to take notice of the fact that initially when the same terms and conditions were incorporated and when the first proposal was invited by the State Government on 27/12/12, one M/s. Panchal Computer filed a writ petition before Indore Bench which was registered as W.P. No. 1120/13 and challenged all these, conditions particularly Clause 7(4). Learned Single Judge vide his judgment and order dated 23/1/2013 filed alongwith the reply of respondent No. 3, Annexure R-3/1 considered the said question and after taking note of principle of law governing judicial interference into such matters found the condition to be proper, in accordance to the requirement of law and dismissed the petition. We are told that the said order has not been challenged. Be it as it may be, the moot question now is as to whether the conditions incorporated and challenged by the petitioner in this petition may be termed as arbitrary, unreasonable or tailor made to suit a particular vendor so as to hold it to be irrational and unsustainable. That being so we would look into each conditions which are already reproduced hereinabove and evaluate it to asses its legality otherwise. 15. The first condition which is challenged i.e. Clause 7(4). it contemplates that the bidder and lead bidder in the consortium should have average sales turnover of Rs. 300 crore in the last consecutive three financial years i.e. 2009-10, 2010-11 and 2011-12. That apart, the other bidder in the consortium is required to have an average turnover of Rs. 10 crores for the same 3 financial years. Petitioner claims this condition to be arbitrary and illegal, only on the ground that in some of the States like Goa, Gujrat and Haryana for similar contracts the turn over fixed is between Rs. 25-50 crores and therefore in fixing a turnover as high as Rs. 300 crores, the State of Madhya Pradesh has committed illegality. Petitioner claims this condition to be arbitrary and illegal, only on the ground that in some of the States like Goa, Gujrat and Haryana for similar contracts the turn over fixed is between Rs. 25-50 crores and therefore in fixing a turnover as high as Rs. 300 crores, the State of Madhya Pradesh has committed illegality. In this regard it may be taken note of that turnover fixed by these States and brought on record as notified are for the year 2007, 2008 and 2009 and not for any work in the year 2013. That apart, certain States like Punjab and Chandigarh have also issued similar contract for the year 2013 and documents available on record show that in these States also the turnover demanded and fixed is 300 crores like in the State of Madhya Pradesh. It is therefore, a case where, each stat is demanding a standard of working and various other facets which are technical in nature are considered and the terms of qualification fixed, merely because the states in the year 2007, 2008 and 2009 had demanded a turn over of 50 crores or so, this court cannot hold the condition to be arbitrary. Each state has its own consideration, requirement and may insist upon a particular level of safety, security etc. if based on such requirement a particular turnover is fixed or a condition imposed, this court cannot interfere into the matter. 16. As far as the reasons given by the State for fixing such a turnover is concerned the same goes to show that after a detailed scrutiny of the requirement for the State of Madhya Pradesh various factors were considered and it was found that project for the present is to function for a period of 5 years and the estimated value of the project for one year would come to 18 crores per annum and if that is taken note of the total project would be of 90 crores for the first 5 years. The project was expandable for the period of 5 years and if 20% increase is given on the business on annual basis the project cost during the period of 10 years would be more than 450 crores. Taking into consideration the same, the turn over in question would be about 500 crores. The project was expandable for the period of 5 years and if 20% increase is given on the business on annual basis the project cost during the period of 10 years would be more than 450 crores. Taking into consideration the same, the turn over in question would be about 500 crores. Accordingly, it is the case of the State Government that taking note of the financial implications as indicated herein above, magnitude of the work, risk of security and safety of the State and the fact that revenue to be collected is more than 15000 crores annually, a very stringent condition have been imposed. Thus the justification given by the State Government for imposing this condition seems to the proper and reasonable. 17. That apart, the State Government has pointed out that the project has to be implemented through out the State covering more than 50 districts and it includes 19 categories of Public Services. The Public Services are: 1. Issue of Learner's License on paper including management & operations of test centre. 2. Issuance of Smart Card based Driving License (DL) 3. Issuance of Smart Card based Vehicle Registration Certificate 4. Issuance of Permits 5. Issuance of N.O.C./Permit Surrender & Temporary Registration 6. Vehicle & Licensee Information/Tax Calculation/Tax Deficiency System 7. Management information system (MIS) including various, reports generation 8. Use of new technologies for Enforcement of transport law & Public convenience like SMS gateway, wed based portal, hand held terminals, computers and other new technologies as and when they are available 9. Use of new technologies for any other associate departments or any other agency 10. Training to the Transport Department Officials 11. Online payment of Taxes 12. De-Duplication of Driving Licenses 13. Document Management System 14. Vehicle Enrollment & Revenue Payment System at Dealer end 15. Centralized Card Personalization Bureau 16. Delivery of Smart Cards by Indian Postal Department 17. Digital Fitness Centre for Vehicles 18. Interactive Citizen Centric services like Computers' Helpline, Dealer point enrollment System etc. 19. We based platform integrated with High Security Registration Plate System. 18. Document Management System 14. Vehicle Enrollment & Revenue Payment System at Dealer end 15. Centralized Card Personalization Bureau 16. Delivery of Smart Cards by Indian Postal Department 17. Digital Fitness Centre for Vehicles 18. Interactive Citizen Centric services like Computers' Helpline, Dealer point enrollment System etc. 19. We based platform integrated with High Security Registration Plate System. 18. That apart, the online facility for payment of tax and fees Transport Department has to continue for 24 hours and 7 days in a week and for the same, vendor is required to establish service centers duly manned by experts functioning 24 hours a day in more than 50 Districts and when the tax is to be credited in the consolidated fund of Government Of India, a very high level of security is required. All these factors have been taken note of while fixing the conditions on turnover. Accordingly, the State Government say and we find that the turnover fixed is proper and justified. 19. As far as Clause No. 7(6) is concerned, it is stated that more than 52 locations spread across the State, requires over 600 personnel, fully furnished computers and other equipments for its proper functioning. The centers have to work through out the day and 7 days in a week and has to be manned by 500-600 professionally or I.T. trained employees. It was because of this that the man power of the Company or the vendor has been fixed at 500. Petitioner has come out with a case that they have more than 500 employees but they have failed to show that their employees are covered under Provident Fund Contributory system. 20. Insisting upon a condition that each employee should come under the Provident Fund Contributory System, is a reasonable condition so as to ensure that the professionals working and employed by the Company are paid properly in accordance with the statutory requirement and it cannot be said that such a condition is unsustainable. To verify this if proof of payment of Provident Fund contribution is insisted upon we see no unreasonableness or arbitrariness on such a condition. To verify this if proof of payment of Provident Fund contribution is insisted upon we see no unreasonableness or arbitrariness on such a condition. As far as Clause No. 7(9), insisting upon the certification of PCI and CMMI Level 3 Certificate or higher is concerned, even though in the Central Motor Vehicles Rules, 1989 and in the definition of Smart Card, there may not be any such condition but if looking to the magnitude of work and other requirement of the work if a particular standard of software required is insisted upon the same is a reasonable decision. 21. The provisions contained in the Central Motor Vehicle Rules, 1989 is a general provision with regard to I.S.O. Certification. If taking note of the specialized-nature of work, which is to be done and after evaluating the magnitude of the work, its financial implication, security consideration etc, a condition is stipulated insisting upon requirement of a very high standard and quality of software, to be used for execution of the work. This Court cannot substitute its own decision and say that insistence upon a particular standard of software is illegal. The question as to what software should be used and what should be the quality and standard of the software to be used for the work in question is a highly technical question, which is determined by various experts and if the experts on such deliberation find that the work in question warrants a particular requirement with regard to quality and standard of a software, this Court does not deem it proper to interfere into this area of expertise and policy making, which is based on various facts that are evaluated by the experts and a decision taken. Merely because the statutory rule prescribes a particular criteria, that does not mean that the State or the Expert Bodies are precluded from adding something more, keeping in view the peculiar nature of the work to be executed and with the development of technology if an additional requirement is insisted upon, which is found to be reasonable, we see no reason to interfere with such a decision. 22. 22. As far as Clause No. 7(11) is concerned, it is a condition which is being insisted upon to ensure that the vendor has worked in a Government Department so that the security aspect and public interest is taken care of Prima-facie, on going through the conditions and evaluating them in the backdrop of the justification given by the State Government, we see no reason to interfere in the matter. 23. That apart, if the aforesaid conditions are evaluated in the backdrop of the legal principles laid down by the SUPREME COURT in the matter of interference, it would be seen that the power of judicial review available to this Court does not permit the power to be invoked only because the petitioner, an unsuccessful vendor, has come out with certain grievances, which cannot be termed as justified. 24. Even though, various judgments as indicated hereinabove were referred to but for the sake of considering question, we may only refer to two of the judgments. In the case of Jagdish Mandal (Supra) in Para-22, the SUPREME COURT laid down the following principles: Judicial review of administrative action is intended to prevent arbitrariness, irrationality, unreasonableness, bias and malafides. Its purpose is to check whether choice or decision is made 'lawfully' and not to check whether choice or decision is 'sound'. When the power of judicial review is invoked in matters relating to tenders or award of contracts, certain special features should be borne in mind. A contract is a commercial transaction. Evaluating tenders and awarding contracts are essentially commercial functions. Principles of equity and natural justice stay at a distance. If the decision relating to award of contract is bona fide and is in public interest, courts will not, in exercise of Page 0102 power of judicial review, interfere even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. The power of judicial review will not be permitted to be invoked to protect private interest at the cost of public interest, or to decide contractual disputes. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review, should be resisted. The tenderer or contractor with a grievance can always seek damages in a civil court. Attempts by unsuccessful tenderers with imaginary grievances, wounded pride and business rivalry, to make mountains out of molehills of some technical/procedural violation or some prejudice to self, and persuade courts to interfere by exercising power of judicial review, should be resisted. Such interferences, either interim or final, may hold up public works for years, or delay relief succour to thousands and millions and may increase the project cost manifold. Therefore, a court before interfering in tender or contractual matters in exercise of power of judicial review, shall pose to itself the following questions: i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone OR Whether the process adopted of decision made is so arbitrary and irrational that the court can say: 'the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached. ii) Whether public interest is affected. 25. This Principle is considered recently in the case of Michigan Rubber (India) Ltd. (supra) and in Para-21, after taking into note of the aforesaid principle, the SUPREME COURT has held as under: If the answers are in the negative, there should be no interference under Article 226. Cases involving black-listing or imposition of penal consequences on a tenderer/contractor or distribution of state largesse (allotment of sites/shops, grant of licences, dealerships and franchises) stand on a different footing as they may require a higher degree of fairness in action. 26. And finally the law with regard to scope of judicial review in the matter is crystallized by the SUPREME COURT in the case of Michigan Rubber (India) Ltd. (Supra) in Para-23 in the following manner: From the above decisions, the following principles emerge: (a) 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. These actions are amenable to the judicial review only to the extent that the State must act validly for a discernible reason and not whimsically for any ulterior purpose if the State acts within the bounds of reasonableness, it would be legitimate to take into consideration the national priorities: (b) fixation of a value of the tender is entirely within the purview of the executive and 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; (c) 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 tendering authority is found to be malicious and a misuse of its statutory powers, interference by Courts is not warranted; (d) 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 (e) 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 fundamental right to carry on business with the Government. 27. If the grounds raised in the writ petition and the reasons given for terming the conditions as arbitrary are evaluated in the backdrop of requirement of law as crystallized hereinabove and if two questions posed by the SUPREME COURT in the case of Jagdish Mandal (Supra) are taken note of and the answers to the same are to be found out, both the questions are to be answered in the negative as far as the present case is concerned. We do not find that the process adopted by the State Government or competent authority are malafide in nature nor is there any material to show that the process is illegal or arbitrary, on the contrary, the decision seems to be proper. 28. It is neither arbitrary nor irrational but is "based on various technical considerations evaluated after taking note: of the requirement of work, the public interest and safety of the matter. 28. It is neither arbitrary nor irrational but is "based on various technical considerations evaluated after taking note: of the requirement of work, the public interest and safety of the matter. That being so, we see no arbitrariness and irrationality on the part of the State Government in fixing the conditions. 29. It is a case, where a policy decision has been taken by the State and the decision is taken after due consideration of various aspects of the matter. A reasonable and fair decision is taken in the interest of the public at large, which cannot be found fault with by this Court, merely because, it throws out the petitioner from the zone of consideration. The contention of the petitioner that the decision arbitrary or is violative of the Article 14and 19(1)(g) of the Constitution is unsustainable. The decision taken by the State does not create any discrimination and the action of the State in including a policy and fixing a condition is found to be just, fair and reasonable, therefore, we see no reason to interfere into the matter. The petition is, therefore, dismissed.