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2014 DIGILAW 795 (ORI)

Suryanarayan Mohanty v. State of Odisha

2014-11-25

A.K.RATH, AMITAVA ROY

body2014
Judgment Dr. A.K. Rath, J. Assailing the decision of the Technical Evaluation Committee disqualifying the petitioner in the technical bid vide Annexure-9, the petitioner has filed the present writ petition. 02. The case of the petitioner is that he is a registered Special Class Contractor. Pursuant to the Tender Call Notice issued by the Chief Engineer (DPI & Roads), Odisha, Office of EIC (Civil), Nirman Soudha, Bhubaneswar opposite party no.2 on 21.02.2014 for the work “Improvement to Barikpur-Dhamnagar road from 0/0 to 9/660 Km under ACA Scheme for the year 201314”, the petitioner had submitted his bids along with turn over certificate, lease agreement dated 3.8.13 for hiring of equipments on lease basis. The opposite party no.6 had also submitted his bid in respect of the said work. While the matter stood thus, the opposite party no.2 sent a letter on 7.6.2014 to the petitioner indicating him that the allegation had been made that the lease agreement submitted by him in the tender for some of the machinery particularly owned by M/s. S.S. Infra Projects Pvt. Ltd had been seized and taken into possession by the financer long before the agreement. The petitioner was asked to clarify the same. He submitted clarification on 18.6.2014 stating that the machineries were not seized by the finance company, nor in possession of third party. On 27.6.2014, vide Annexure-6, the opposite party no.2 sent a letter to the petitioner and opposite party no.6 to attend the office on 3.7.2014 at 4.00 pm for verification of originals of all the scanned documents uploaded in the technical bid. On 30.7.2014, the opposite party no.2 also sent a letter to extend the validity of the tender for a further period of 90 days. On 8.8.2014, he extended the validity of the tender. The further case of the petitioner is that the opposite party no.6 had submitted forged documents, i.e., tax invoice relating to Mini Batching Plant complete RMG 800. The petitioner submitted a representation on 18.6.2014 drawing the attention of the opposite party no.2 to the said fact vide Annexure-8 series. Again he submitted a representation on 11.8.2014 about the manipulation of documents submitted by opposite party no.6. But the same was not heeded to. The petitioner submitted a representation on 18.6.2014 drawing the attention of the opposite party no.2 to the said fact vide Annexure-8 series. Again he submitted a representation on 11.8.2014 about the manipulation of documents submitted by opposite party no.6. But the same was not heeded to. While the matter stood thus, on 1.9.2014 at about 11.30 A.M., the opposite party no.2 floated in the website the proceeding of the Technical Evaluation Committee held on 27.7.2014 at about 11 A.M. disqualifying him in the technical bid. The decision was taken on the basis of the spot verification report of the Executive Engineer, Bhadrak (R&B) Division, Bhadrak -opposite party no.5 and the clarification received from M/s. SREI Equipment Finance Ltd. Thereafter the opposite parties opened the price bid of opposite party no.6 on 1.9.2014 and found that he has quoted 9.7% excess than the estimated cost of the value of work. The petitioner has quoted the price bid at 9.2% less than the estimated cost. In the event, the tender is finalized in favour of opposite party no.6 then the State will lose public revenue of Rs.92,61,000/-. 03. Pursuant to issuance of notice, the opposite party no.5 has filed a counter affidavit. The sum and substance of the case of the opposite party nos.1 to 5 is that on the basis of the representation dated 22.5.2014 made by the opposite party no.6 vide Annexure-A/5, the financer M/s. SREI Equipment Finance Ltd. was requested by the opposite party no.2 on 7.6.2014 vide Annexure-B/5 to clarify the authenticity of machinery under the possession of M/s. S.S. Infra Projects Pvt. Ltd. In reply, the financer M/s. SREI Equipment Finance Ltd. sent a letter on 9.6.2014 to the opposite party no.2, vide Annexure-C/5, and stated that the machinery such as Volvo Compactor had already been seized and the other machineries such as Volvo Tandem Roller and Wirtgen Paver were not traceable and the financer was trying to repossess those machineries. Therefore, the petitioner could not secure marks for the above machineries. The petitioner also could not secure the minimum qualifying percentage of marks, i.e., 80% as per clause of DTCN, for which he was disqualified in the technical bid. It is further stated that the petitioner had submitted lease agreement entered into between him and Sri Puna Chandra Biswal only for mechanical paver finisher which had already been considered in the evaluation. It is further stated that the petitioner had submitted lease agreement entered into between him and Sri Puna Chandra Biswal only for mechanical paver finisher which had already been considered in the evaluation. He had not uploaded any lease agreement and tax invoice of M/s. Biswal construction in the technical bid. It is further stated that the invoice submitted by the opposite party no.6 was taken into consideration on the basis of the spot verification report of the opposite party no.5. On the basis of the representation submitted by the petitioner, as per Technical Evaluation Committee, the opposite party no.5 was requested for spot verification of the machineries of opposite party no.6. The opposite party no.5 after spot verification submitted a report on 1.8.2014 stating therein that the machineries were physically available. It is further stated that after opening of the financial bid of opposite party no.6, there was a negotiation. On negotiation, opposite party no.6 offered 4.5% excess over the estimated cost and the same was accepted. 04. Opposite party no.6 has also filed a counter affidavit. The case of the opposite party no.6 is that after submission of technical bid, he found that a false lease agreement had been filed by the petitioner at the time of submission of technical bid. Thereafter, he filed an objection on 22.5.2014 stating that the lease agreement submitted by the petitioner with regard to the machinery had already been seized by the financer M/s. SREI Equipment Finance Ltd. Thereafter the petitioner had also filed a complaint before the opposite party no.2 against him. After receiving complaints from both the sides, opposite party no.2 called upon both the bidders to appear on 3.7.2014 for verification of the original documents. The spot verification of the plant site of opposite party no.6 was made by the opposite party no.5. After spot verification, he submitted a report stating that the machineries were available on the plant site. The Committee after taking into consideration the report submitted by the opposite party no.5 and clarification from the financer M/s. SREI Equipment Finance Ltd. qualified the opposite party no.6 and accordingly executed the agreement and issued work order. 05. The petitioner also filed a rejoinder controverting the allegations made in the counter affidavit filed by the opposite parties. 06. Heard Mr. U.C. Mohanty, learned counsel for the petitioner, Mr. 05. The petitioner also filed a rejoinder controverting the allegations made in the counter affidavit filed by the opposite parties. 06. Heard Mr. U.C. Mohanty, learned counsel for the petitioner, Mr. P.K. Muduli, learned Additional Standing Counsel for the State-opposite party nos.1 to 5 and Mr. R.K. Rath, learned Senior Advocate for the opposite party no.6. 07. Mr. Mohanty, learned counsel for the petitioner submits that as per Clause 2.3 of the DTCN, the tender inviting authority will verify the original document of all the scanned documents of the successful lowest bidder only within five days of the opening of the tender (price bid). But in the instant case, the same has not been done. Much before opening of the financial bid, the opposite party no.2 travelled beyond his jurisdiction in directing the petitioner to attend the office on 3.7.2014 at 4.00 P.M. for verification of originals of all the scanned documents uploaded in the technical bid. He further submits that the machineries owned by M/s. S.S. Infra Projects Pvt. Ltd., with whom the petitioner has entered into agreement, had not been seized by the financer. Had the list of machineries submitted by the petitioner been taken into account, then the petitioner would have qualified in the technical bid. He further submits that the opposite party no.6 also submitted forged and fabricated invoices of M/s. Dipti Engineering Works, Howrah, West Bengal for which the petitioner made a representation to the opposite party no.2. But the opposite party no.2 maintained a sphinx-like silence. Drawing attention to the letter dated 9.9.2014 issued by M/s. Dipti Engineering Works, vide Annexure-10, he submits that the opposite party no.6 had forged the bills and challans. In view of the same, the Tender Evaluation Committee committed manifest illegality and impropriety in accepting the financial bid of opposite party no.6. 08. Per contra, Mr. Muduli, learned Additional Standing Counsel submits that the opposite party no.6 made a complaint to the opposite party no.2 that the machineries of M/s. S.S. Infra Projects Pvt. Ltd., with whom the petitioner entered into the agreement, had been seized by the financer M/s. SREI Equipment Finance Ltd. Thereafter the financer was requested for clarification regarding the authenticity of the machineries. In reply, the financer stated that the machinery such as Volvo Compactor has already been seized and other machineries such as Volvo Tandem Roller and Wirtgen Paver were not traceable and the financer was trying to repossess the machineries. Thus the petitioner could not secure the minimum qualifying marks. He further submits that the opposite party no.5 made a spot verification and found that the machineries were physically available. He further submits that after opening of the financial bid, there was a negotiation, whereafter the opposite party no.6 offered 4.5% excess over the estimated cost and the same was accepted. 09. Mr. Rath, learned Senior Advocate for the opposite party no.6 submits that the petitioner has submitted forged lease agreement at the time of submission of technical bid. Thereafter the opposite party no.6 filed an objection on 22.5.2014 stating therein that the financer M/s. SREI Equipment Finance Ltd. had seized the machineries from M/s. S.S. Infra Projects Pvt. Ltd. The petitioner had also made complaint against the opposite party no.6 before the opposite party no.2. The opposite party no.2 after receipt of complaint from both the sides called upon both the petitioner and opposite party no.6 to appear on 3.7.2014 at 4.00 P.M. for verification of originals of all scanned documents. Thereafter both the bidders appeared on the date fixed and the documents were verified. He further submits that the opposite party no.5 after spot verification of the plant site of the opposite party no.6 submitted a report to the opposite party no.2 that the machineries were available in the plant site and the same were in good condition. He further submits that the Committee after taking into consideration qualified the opposite party no.6. Thereafter an agreement was entered into and work order was issued in faovur of opposite party no.6. 10. The principles which have been applied in judicial review of administrative decisions, especially those relating to acceptance of tender and award of contract, have been considered in great detail by the apex Court in Tata Cellular v. Union of India, (1994) 6 SCC 651 . In paragraphs 77 and 94, it is held as follows:- “77. The duty of the court is to confine itself to the question of legality. Its concern should be: (1) whether a decision-making authority exceeded its powers? In paragraphs 77 and 94, it is held as follows:- “77. The duty of the court is to confine itself to the question of legality. Its concern should be: (1) whether a decision-making authority exceeded its powers? (2) committed an error of law, (3) committed a breach of the rules of natural justice, (4) reached a decision which no reasonable tribunal would have reached, or (5) abused its powers. Therefore, it is not for the court to determine whether a particular policy or particular decision taken in the fulfillment of that policy is fair. It is only concerned with the manner in which those decisions have been taken. The extent of the duty to act fairly will vary from case to case. Shortly put, the grounds upon which an administrative action is subject to control by judicial review can be classified as under: (i) Illegality: This means the decision-maker must understand correctly the law that regulates his decision-making power and must give effect to it. (ii) Irrationality, namely, Wednesbury unreasonableness. (iii) Procedural impropriety. The above are only the broad grounds but it does not rule out addition of further grounds in course of time. As a matter of fact, in R. v. Secretary of State for the Home Deptt., ex p Brind, Lord Diplock refers specifically to one development, namely, the possible recognition of the principle of proportionality. In all these cases the test to be adopted is that the court should, “consider whether something has gone wrong of a nature and degree which requires its intervention”. 94. The principles deducible from the above are: (1) The modern trend points to judicial restraint in administrative action. (2) The court does not sit as a court of appeal but merely reviews the manner in which the decision was made. (3) The court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. (5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides. (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure.” We have considered the present case on the anvil of the decision cited supra. 11. The centripodal point which hinges for our consideration is as to whether the Tender Evaluation Committee had committed illegality and impropriety in disqualifying the petitioner in technical bid. First we deal with the submission of Mr. Mohanty with regard to the violation of Clause 2.3 of the DTCN. Since sufficient opportunity had been provided to the petitioner to prove the genuineness of the documents, after availing the same, the petitioner can not turn round and say that there is violation of the said clause. As would be evident from the materials on record, the petitioner had entered into an agreement with M/s. S.S. Infra Projects Pvt. Ltd., vide Annexure-3 series for supply of machineries. On the basis of the representation submitted by the opposite party no.6, the financer M/s. SREI Equipment Finance Ltd. was requested by the opposite party no.2 on 7.6.2014, vide Annexure-B/5 to clarify the authenticity of the possession of the machineries by M/s. S.S. Infra Projects Pvt. Ltd. The financer sent a letter on 9.6.2014 vide Annexure-C/5 to the opposite party no.2 stating therein that it had extended loan assistance to M/s. S.S. Infra Projects Pvt. Ltd. for acquisition of the machineries. Due to nonpayment of monthly installments, it repossessed one Volvo Excavator, one Volvo Compactor and four numbers of Man Tipper. After re-possession, those equipments had been disposed of. Due to nonpayment of monthly installments, it repossessed one Volvo Excavator, one Volvo Compactor and four numbers of Man Tipper. After re-possession, those equipments had been disposed of. The remaining equipments were not traceable and that they were trying to repossess the same once they are located. Be it noted that neither M/s. S.S. Infra Projects Pvt. Ltd. nor M/s. SREI Equipment Finance Ltd. are parties to the writ petition. There is no whisper in the writ petition or in the rejoinder affidavit that the machineries are still available either with M/s. S.S. Infra Projects Pvt. Ltd or the petitioner. On a query to the same, Mr. Mohanty made a feeble attempt to justify the same. Since the machineries had been seized by the financer and disposed of and not in possession of the petitioner or with M/s. S.S. Infra Projects Pvt. Ltd., we are of the opinion that the Tender Evaluation Committee is quite justified in rejecting the technical bid of the petitioner. So far as opposite party no.6 is concerned, after receiving complaint from the petitioner, the opposite party no.5 made a spot enquiry and found that the machineries were available on the plant site in good running condition. The allegations that the State would lose amount of Rs.92,61,000/-is not only baseless, but the same have no legs to stand. After the technical bid of the petitioner was rejected, the financial bid of the opposite party was opened. On negotiation, the opposite party no.6 offered 4.5% excess over the estimated cost. Thus the calculation made by the petitioner is imaginary. 12. On the ultimate analysis, we find that there is no illegality, irrationality and procedural impropriety in arriving at the decision making process while rejecting the technical bid of the petitioner. The writ petition, being devoid of merit, is dismissed. Mr. Amitava Roy, C.J. : I agree.