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2014 DIGILAW 343 (MP)

Rajendra Rai v. State of M. P.

2014-03-27

ALOK ARADHE

body2014
Judgment: Alok Aradhe, J. 1. In this writ petition, the petitioner, inter alia, seeks quashment of acceptance of single offer of respondent No. 4 for grant of licence to sell country and foreign liquor as well as order dated 10-3-2014 passed by the Deputy Secretary. The petitioner also seeks a direction to respondent Nos. 1 to 3 to open the financial bid of the petitioner to grant licence to him as he is the highest bidder. In order to appreciate the petitioners' grievance, few facts need mention, which are stated infra. The petitioner and respondent No. 4 submitted their tenders for obtaining licence in respect of country liquor and foreign liquor retail shop situated at Khandali, District Narsinghpur. The petitioner offered a bid of Rs. 3,59,00,000/- (Rupees Three crores fifty nine lacs) whereas the respondent No. 4 submitted an offer of Rs. 3,51,00,000/- (Rupees Three crores fifty one lacs). The petitioner alongwith his tender form submitted a demand draft of Rs. 43.50 lacs towards earnest money. The bid was submitted in two parts. When the first part of the bid was opened, the petitioner was informed that Part I of the bid submitted by the petitioner does not contain an endorsement that the documents annexed with Part I of the tender have been submitted by the petitioner himself. Thereupon, the petitioner raised an objection on 1-3-2014. However, the Collector did not seek any clarification/instruction from the Commissioner (Excise). The petitioner submitted an application on 1-3-2014 to the Commissioner (Excise) on the ground that on account of inadvertence the petitioner did not mention in Part I of the bid that the documents annexed with Part I of the bid were submitted by the petitioner himself and the same tantamounts to mistake of general or clerical nature. Accordingly, his financial bid be accepted. However, bid of respondent No. 4, which was lower, was accepted on 1-3-2014. 2. It appears that the Commissioner (Excise) thereupon referred the matter to the Deputy Commissioner (Excise) and sought clarification from the Collector. The Collector in its report stated that since the petitioner had not made an attestation in the documents annexed in Part I of his bid as required under Clauses 16.14 and 20 of the Notice Inviting Tender, therefore, Part I of his bid be treated to be incomplete and Part II, namely, financial bid be not opened. The Collector in its report stated that since the petitioner had not made an attestation in the documents annexed in Part I of his bid as required under Clauses 16.14 and 20 of the Notice Inviting Tender, therefore, Part I of his bid be treated to be incomplete and Part II, namely, financial bid be not opened. The Deputy Commissioner, by communication, dated 2-3-2014 informed the Commissioner that non-attestation of the document annexed with Part I of the bid submitted by the petitioner amounts to mistake of clerical or general in nature, therefore, the District Committee ought to have got the mistake corrected and should have opened the financial bid of the petitioner. The Commissioner (Excise) agreed with the opinion given by the Deputy Commissioner and suggested that the mistake committed by the petitioner be rectified in terms of Clause 16.17 of the Notice Inviting Tender and the financial bid of the petitioner be opened in the interest of revenue. The Commissioner referred the matter for consideration to the State Government. The Principal Secretary of Commercial Tax expressed the opinion that in view of the proposal given by the Commissioner (Excise) no action at this stage is required and, in case, the petitioner is aggrieved he should approach the Court. The Deputy Secretary vide order dated 10-3-2014 rejected the claim of the petitioner. In the aforesaid factual background the petitioner has approached this Court. 3. Learned Senior Counsel for the petitioner submitted that admittedly the petitioner's bid is higher than the respondent No. 4. Under Clause 16.17 of the Notice Inviting Tender any clerical mistake of general or clerical nature can be corrected by the District Committee. It is further submitted that Clauses 16.8 and 20 of the Notice Inviting Tender are directory in nature as no consequences of their non-compliance are provided. It is further submitted that the Commissioner (Excise) is the final authority to take decision under Clause 16.17 of the Notice Inviting Tender and the decision of the Commissioner is binding. It was also urged that the Commissioner's decision was not over-ruled by the State Government and, in case, the financial bid of the petitioner is not opened, there would be loss of Rs. 7 lacs to the State exchequer. In support of aforesaid submission, learned Senior Counsel has placed reliance on an order passed by a Bench of this Court in Harpal Singh Bhatia Vs. 7 lacs to the State exchequer. In support of aforesaid submission, learned Senior Counsel has placed reliance on an order passed by a Bench of this Court in Harpal Singh Bhatia Vs. State of M.P. and others, Writ Petition No. 3836/2012, decided on 3-4-2012. 4. On the other hand, learned Deputy Government Advocate has submitted that the case of the petitioner falls under Clause 16.8 and Clause 20 of the Notice Inviting Tender, which are mandatory in nature and the financial bid of the petitioner has not been opened on account of non-compliance with the mandatory condition. The case of the petitioner does not fall within the purview of Clause 16.17 of the Notice Inviting Tender. It is also urged that the condition with regard to attestation of the documents annexed with Part I of the tender submitted by the petitioner has been incorporated as it was found that in certain cases some of the tenderers, who participate in the tender process and quote excessive amount, do not turn up to execute the contract. 5. Learned Senior Counsel for respondent No. 4, on the other hand, submitted that the District Committee had never sought any guidance from the Commissioner. The petitioner submitted the representation directly to the Commissioner and thereupon reference was made to the State Government, which has been rejected. It is further submitted that Clause 16.18 as well as Clause 20 of the Notice Inviting Tender are mandatory in nature and since the petitioner had not complied with the mandatory provision of the Notice Inviting Tender, therefore, the bid of the petitioner has rightly been rejected. In support of his submission, learned Senior Counsel has placed reliance on the decision of Supreme Court in Ashok Lanka and another Vs. Rishi Dixit and others, AIR 2005 SC 2821 and decision of this Court in Ramabhilsh Kori Vs. State of M.P., 2007 (3) MPLJ 300 . 6. I have considered the respective submissions made by learned Counsel for the parties. The authority inviting tender is bound to give effect to every term mentioned in the notice in meticulous details and is not entitled to waive even a technical irregularity of little or no significance. State of M.P., 2007 (3) MPLJ 300 . 6. I have considered the respective submissions made by learned Counsel for the parties. The authority inviting tender is bound to give effect to every term mentioned in the notice in meticulous details and is not entitled to waive even a technical irregularity of little or no significance. The requirements in a tender notice can be classified into two categories, those which lay down the essential conditions of eligibility and the others, which are merely ancillary or subsidiary with the main object to be achieved by the condition. In the first case, the authority issuing the tender may be required to enforce them rigidly. In the other cases, it must be open to the authority to deviate from and not to insist upon the strict literal compliance of the conditions in appropriate cases. [See: G.J. Fernandez Vs. State of Karnataka and others, (1990) 2 SCC 488 and Poddar Steel Corporation Vs. Ganesh Engineering Works and others, (1991) 3 SCC 273 ]. Whether a condition in the Notice Inviting Tender is essential or collateral could be ascertained by reference to the consequence of non-compliance thereto. If non-fulfillment of the requirement results in rejection of the tender, then it would be an essential part of the tender otherwise, it is only a collateral term. [See: Kanhaiyalal Agrawal Vs. Union of India and others, (2002) 6 SCC 315 ]. 7. In the backdrop of well-settled legal position, the relevant clauses of the Notice Inviting Tender, namely, Clauses 16.8, 16.14, 16.17 and 20 may be noticed, which read as under:-- 8. From the close scrutiny of the aforesaid clauses of the Notice Inviting Tender, it is evident that tenderer is required to put attestation on the documents annexed with the Part I of the tender that the documents have been presented by him, in view of Clauses 16.8 and 20 of the Notice Inviting Tender. However, Clause 16.17 provides that in case if appropriate earnest money is deposited along with the Part I of the bid, then the financial bid submitted by the tenderer should not be rejected merely on the ground of clerical or general error. Such an error can be got corrected by the District Committee and in case of any doubt, the Collector can seek instructions from the Commissioner (Excise). Such an error can be got corrected by the District Committee and in case of any doubt, the Collector can seek instructions from the Commissioner (Excise). If Clauses 16.14 and 16.17 are read together, it is evident that in cases the tenderer deposits requisite earnest money with Part I of the bid, his financial bid should not be rejected merely on the basis of an error which may be of clerical or general in nature. It is not in dispute that petitioner has deposited requisite earnest money with Part I of the bid. An interpretation that if tenderer fails to attest the documents annexed with the Part I of the bid, then in such a case, his financial bid shall not be opened, would render Clause 16.17 of the Notice Inviting Tender redundant and otiose. Apart from this, Clause 16.14 and Clause 20 of the Notice Inviting Tender are not the essential condition of the Notice Inviting Tender but are collateral ones, as the consequence of non-compliance thereof are not provided in the Notice Inviting Tender and the consequences of non-compliance with Clauses 16.14 and 20 do not result in rejection of the tender. The Deputy Commissioner as well as the Commissioner (Excise) have opined that mistake committed by the petitioner with regard to non-attestation of the documents submitted along with Part I of the bid is of clerical/general in nature, and the same should have been got corrected by the District Committee and the bid of the petitioner, which is higher, should be opened in the interest of revenue. It is also pertinent to mention here that the State Government has not disagreed with the view taken by the Commissioner (Excise). The decision of an Executive Authority must be informed by reason and should be in public interest. The action of District committee in not opening the financial bid of the petitioner, which admittedly is higher, cannot be sustained in the eye of law. The decision relied upon by the learned Senior Counsel for respondent No. 4 in the case of Ashok Lanka (supra), is of no assistance to him as the non-compliance of the conditions in the aforesaid case debars a person from filing an application. Similarly, a Bench of this Court in Ramabhilsh Kori (supra), has held that re-action cannot be ordered in violation of the terms and conditions of the Notice Inviting Tender. Similarly, a Bench of this Court in Ramabhilsh Kori (supra), has held that re-action cannot be ordered in violation of the terms and conditions of the Notice Inviting Tender. The aforesaid decision has also no application to the facts of the case. 9. In view of the preceding analysis, the order of the District Committee accepting the bid of the respondent No. 4, dated 1-3-2014 as well as order dated 10-3-2014 passed by the Deputy Secretary, are hereby quashed. The District Committee is directed to get attestation on the documents submitted by the petitioner along with Part I of the bid and to accept the bid of the petitioner, which is highest, and to complete the formalities for grant of licence in respect of shop in question in favour of the petitioner expeditiously. In the result, the writ petition is allowed.