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2015 DIGILAW 562 (GAU)

Sattya Barman v. State of Assam & Ors.

2015-05-13

SUMAN SHYAM

body2015
Suman Shyam, J.- Heard Mr. G. Goswami, learned counsel for the petitioners. Also heard Mr. A. K. Bhuyan, learned counsel appearing for the respondent Nos. 2 and 4 as well as Mr. G. Sarma, learned Govt. Advocate, Assam representing the respondent Nos. 1 and 3. Respondent No. 5 in both the cases did not appear despite receipt of notice. 2. The basic grievance of the writ petitioners in both the above noted writ petitions is that they being the highest bidder in respect of the tender process initiated by the respondent No. 4 for settlement of the markets in question, the impugned decision of the authorities to award the settlement in favour of the respondent No. 5 in both the cases, who had quoted a rate much less than the writ petitioners, is vitiated by absolute illegality, arbitrariness and is a glaring instance of mala fide exercise of powers. Since the grievance expressed by the writ petitioners arises out of identical fact situation involving common questions of law, hence I propose to dispose of both the writ petitions by this common judgment and order. FACTS IN WP(C) NO. 3476/2014: 3. In this writ petition the respondent No. 4, viz., the Block Development Officer, Tihu-Barama Development Block, Baska (BTAD), Assam had issued a Tender Notice bearing No. TBDB/Market/19/2014-15/1292 dated 31.05.2014 inviting bids for settlement of the "Barama Hat" Market for a period of one year i.e. for the year 2014-15 with the highest bidder. Clause 12 of the Tender Notice dated 31.05.2014 inter-alia contained a condition which reads as follows:- "12. The competent authority shall have the right to accept or reject any tender and authority is not binding to accept or reject any tender including the offered abnormal high against the schedule rate of the market." 4. In response to the said tender notice the petitioner herein, Sri Saitya Barman, had submitted his bid along with other tenderers. The respondent No. 5, Sri Bisti Kumar Boro, had also submitted his bid. The tender was opened on 18.6.2014 .On opening of the bids submitted by the respective bidders the writ petitioner had emerged as the highest bidder having quoted a price of Rs. 9,17,000 (Rupees Nine Lacs Seventeen Thousand). The respondent No. 5 had quoted Rs. 5,00,000 (Rupees Five Lacs) and emerged as the third highest bidder. The tender was opened on 18.6.2014 .On opening of the bids submitted by the respective bidders the writ petitioner had emerged as the highest bidder having quoted a price of Rs. 9,17,000 (Rupees Nine Lacs Seventeen Thousand). The respondent No. 5 had quoted Rs. 5,00,000 (Rupees Five Lacs) and emerged as the third highest bidder. From a perusal of the comparative statement prepared by the tendering authority, the position that emerged after opening of the bids is indicated in a tabular form herein below:- SI. No. Name of the tenderers Price quoted Position Remarks 1.Sri Saitya Barman (the petitioner)9,17,0001st Documents are clear. 2.Sri Naren Boro8,000002ndDocuments are clear. 3.Bisti Kumar Boro5,000003rd Documents not clear. 4.Sri Dhaneswar Medhi3,99,0004th Except column No. 22 other documents are clear. 5. The grievance of the writ petitioner is that although he had emerged as the highest bidder and notwithstanding the fact that the documents submitted by the petitioner were found to be in order, yet the authorities had rejected his tender and on the contrary awarded the settlement in favour of the 3rd highest bidder i.e. the respondent No. 5 by ignoring the fact that his documents were found to be in defective. FACTS IN WP(C) NO.3469/2014: 6. By issuing Tender Notice No. BDB/Market-31/2014-15/3189 dated 03.06.2014 the respondent No. 4, (EDO, Baska) had invited bids for settlement of the market, viz., "Adalbari Daily Market" in favour of the highest bidder subject to fulfillment of the terms and conditions contained in the Tender Notice. The clause No. 11 of the notice dated 03.06.2014 contained a similar condition as that of clause No. 12 of the Tender Notice dated 31.05.2014, which has been quoted herein before. 7. In response to the Tender Notice dated 03.06.2014, only two bidders had submitted their bids, i.e. the petitioner viz. Golok Pathak and the respondent No. 5 viz. Sri Gakul Boro. The bids were opened on 18.06.2014 in presence of the bidders. After opening the bids here also the writ petitioner emerged as the highest bidder having quoted an amount of Rs. 51,749 (Rupees Fifty One Thousand Seven Hundred and Forty Nine) and his documents were found to be in order. The respondent no 5 had quoted Rs. 50,501 (Rupees Fifty Thousand Five Hundred and One) and was the second highest bidder. After opening the bids here also the writ petitioner emerged as the highest bidder having quoted an amount of Rs. 51,749 (Rupees Fifty One Thousand Seven Hundred and Forty Nine) and his documents were found to be in order. The respondent no 5 had quoted Rs. 50,501 (Rupees Fifty Thousand Five Hundred and One) and was the second highest bidder. The grievance of the writ petitioner in this case is that despite the fact that he had emerged as the highest bidder and notwithstanding the fact that his documents were found to be valid, the respondent authorities have settled the market with the second highest bidder i.e. respondent No. 5 in a most arbitrary and illegal manner. 8. The respondent Nos. 2, and 4 have filed their affidavit-in-opposition on 19.01.2015 annexing a copy of the minutes of the Market Settlement Committee Meeting held on 01.07.2014 in the Conference Hall of the ETC Secretariat, Block-'A', at Kokrajhar, whereby the Market Committee constituted for the purpose of settlement of Market/Parking/ Parghat/Min Mahal etc. for the year 2014-15 had taken certain decisions pertaining to the process to be adopted for settlement of a number of Markets/ Hats/ Parking/ Par Ghat/Min Mahal etc. including those involved in the present proceedings. As per the minutes of the meeting dated 01.07.2014 it appears that the Committee had decided to settle the said market etc. for the year 2014-15 strictly adhering to the Rules and Acts in force so as to avoid audit objection and legal issues. After a threadbare discussion the Committee had adopted certain resolutions. Resolution Nos. 1, 2 and 3 are quoted herein below for ready reference:- "1. The meeting discussed and decided to approve for settlement of lease of Market/ Parking/Parghat/Min Mahal etc. who tendered/offered highest rate/value provided availability of necessary papers/documents of the tender. 2. The meeting was decided to approve the tender as per existing Rules/Act of Govt. of Assam. 3. The meeting discussed and observed that most of the tenderers are used to offer higher amount than the scheduled rate as their bid amount in the tenders. In such cases the committee expressed apprehension that the tenderers may apply for imposition of higher toll than the schedule rate which might bring burden to the poor rural sellers. of Assam. 3. The meeting discussed and observed that most of the tenderers are used to offer higher amount than the scheduled rate as their bid amount in the tenders. In such cases the committee expressed apprehension that the tenderers may apply for imposition of higher toll than the schedule rate which might bring burden to the poor rural sellers. In such cases the committee decided to declare/treat as abnormal for the tender offering if double or more than double of the scheduled rate." 9. In their counter affidavit the respondent authorities have denied that there was any arbitrariness or mala fide exercise of power in settling the markets with the private respondents. The stand taken by the authorities was that as per Resolution No. 3 adopted in the meeting dated 01.07.2014 the bidders whose quoted price were found to be more than double the Government scheduled rate had been rejected. The said decision had been taken in consideration of the fact that exorbitantly high price quoted by the tenderer might cast unnecessary burden upon the poor rural sellers as the settlement holder might make an attempt to recover fees from such sellers at an exorbitant rate. 10. Mr. G. Goswami, learned counsel appearing for the writ petitioners, submits that the bidders were never informed in advance that price quoted by them if found to be double the amount of scheduled rate fixed by the Government would be rejected only on such ground. Had it been known to the bidders that a criteria in the line of Clause 3 contained in the Minutes of the Meeting dated 01.07.2014 had been adopted by the Market Settlement Committee then his clients would have never quoted rate beyond double the amount of the Government scheduled rate. Mr. Goswami has further submitted that it is not in dispute that the market was intended to be settled with the highest bidder as has been indicated by the authorities at the time of issuing the Tender Notice. Such being the position, there was no justification for the authorities to reject the bids submitted by the petitioners simply because they had quoted a higher price. Such an action besides being arbitrary and discriminatory is also causing heavy loss to the State exchequer. 11. Such being the position, there was no justification for the authorities to reject the bids submitted by the petitioners simply because they had quoted a higher price. Such an action besides being arbitrary and discriminatory is also causing heavy loss to the State exchequer. 11. By referring to a Full Bench decision of this Court reported in 2009 (2) GLT 561 (Harez Ali and another v. State of Assam and others) Mr. Goswami has submitted that white interpreting the expression "yearly sale value" as employed under Section 109(6) of the Assam Panchayat Act, 1994, this Court has held that such yearly sale value cannot be fixed by the Anchalik Panchayat but the meaning of the said expression in the context of fixing the sale value of all ghats, hats and fisheries under the Anchalik Panchayat put in tender for settlement would mean the highest bid amount that is offered by the eligible bidder in terms of the provisions of the Act. Mr. Goswami, therefore, submits that the impugned decision to award the private respondents with the settlement by ignoring the higher prices quoted by the petitioners in both the cases is absolutely arbitrary, illegal and actuated by malice. As such, the award made in favour of the private respondents was liable to be interfered with by this Court. 12. Per contra, Mr. A.K. Bhuyan, learned Standing Counsel, BTC, representing the respondent Nos. 2 and 4, submits that the decision to award the settlement in favour of the respondent No. 5 in both the cases are based on reasonable assessment of the ground realities and also taking note of the terms and conditions contained in the respective Tender Notices. By drawing the attention of this Court to Clause 12 of the Tender Notice dated 31.05.2014, Mr. Bhuyan submits that the bidders had been put to notice right at the stage of issuing the Tender Notice that price quoted at a rate abnormally higher than the Government scheduled rate would be liable to rejection at the discretion of the authorities. He, therefore, submits that the present is not a case where the petitioners were caught completely unaware about such a evaluation criteria that could come into play. By referring to the resolution No. 3 recorded in the minutes of the meeting dated 01.07.2014 Mr. He, therefore, submits that the present is not a case where the petitioners were caught completely unaware about such a evaluation criteria that could come into play. By referring to the resolution No. 3 recorded in the minutes of the meeting dated 01.07.2014 Mr. Bhuyan submits that such a decision had been taken by bearing in mind various local factors including the strife and tension prevalent in various areas falling under the BTC and also bearing in mind the best interest of the BTC. There was reasonable basis for the authorities to take the decision that has been impugned in these proceedings. He submits that the Assam Panchayat Act, 1994 is not applicable in the BTC area as the same is governed under the sixth schedule of the Constitution of India. Mr. Bhuyan further submits that in exercise of powers conferred under Article 226 of the Constitution of India this Court would only look at the decision making process and not go into the merit of the decision itself since, the authorities were in a good position to decide the criteria taking note of the attending facts and circumstances. 13. In support of his argument Mr. Bhuyan has relied upon two decisions of the Hon'ble Apex Court reported in (2004) 4 SCC 19 (Directorate of Education and others v. Educomp Datamatics Ltd. and others) and (2003) 1 SCC 341 (Rayalaseema Paper Mills Ltd. and another v. Government of A.P. and others) to argue that scope of judicial review is very limited in matters of terms and condition of a tender more particularly when it comes to price fixation in commercial contracts. 14. I have considered the submissions made by and on behalf of the parties and have also perused the records produced by Mr. Bhuyan. It is not in dispute that the criteria evolved under Resolution No. 3 of the minutes of meeting dated 01.07.2014 was not known to any of the bidders before submission of the bids but the said criteria had been evolved after the opening of the bids. Bhuyan. It is not in dispute that the criteria evolved under Resolution No. 3 of the minutes of meeting dated 01.07.2014 was not known to any of the bidders before submission of the bids but the said criteria had been evolved after the opening of the bids. Although Clause 12 of the Tender Notice did give a hint that prices quoted if found to be abnormally high as compared to the Government scheduled rate could be liable to be rejected at the discretion of the authorities yet, there was nothing to indicate as to what would be the standard for ascertaining the abnormality of the price quoted in the context of the different markets put to tender. It is, therefore, obvious that the criteria based on which the bids of the petitioners had been rejected was evolved after the bids were opened and the price quoted by the different bidders had become known to the authorities. 15. It is trite law that price alone cannot be a decisive criterion in a tender process involving the interest of the Government. However, in a tender where the highest bidder is to be awarded the tender, benefit accruing to the public exchequer due to the higher price quoted by the bidder would be a relevant factor and the same cannot altogether be ignored by the authorities without a valid reason. Once the tenders had been invited for awarding the settlement to the highest bidders, the rate quoted by the highest bidders could not have been dispensed with by the authorities in such a casual manner as has been done in the present case. 16. In the case of Dutta Associates Pvt. Ltd. v. Indo Merchantiles Pvt. Ltd. and others, reported in (7997) 1 SCC 53 the Hon'ble Apex Court has observed that whatever procedure the Government proposes to follow in accepting a tender must be clearly stated in the tender notice. The consideration of the tenders received and the procedure to be followed in the matter of acceptance of a tender should be transparent, fair and open. 17. The consideration of the tenders received and the procedure to be followed in the matter of acceptance of a tender should be transparent, fair and open. 17. In the case of Educomp Solutions Ltd. and others v. State of Assam and others reported in (2006) 3 GLR 117 a Division Bench of this Court has held that it would not be permissible for the authorities to evaluate the bids by employing hidden criteria that was not made known to the bidders prior to submission of the tender. The observation made by the Division Bench in para 49 of the aforesaid judgment is quoted herein below:- "49. We are unable to persuade ourselves to accept the contention of the learned senior counsel Shri R.K. Anand that it is not at all necessary for the governmental agencies to notify the selection criteria in detail even at the threshold and the same can be done at any stage. Does it mean the selection criteria can be evolved after opening of the technical bids? Would it not give room and leverage to the decision makers to manipulate the result to suit the convenience of a particular bidder? In our view even if such criteria is not notified at the beginning the same should be made known to all the interested before submission of bids by duly informing them about the proposed criteria to be applied and the methodology in awarding the marks to evaluate the technical and commercial bids. In the case on hand such a course ought to have been adopted at least on 14.12.2005 when the amendments to the NIT were communicated to all the concerned. In fact, the case set up by the AMTRON is as if the methodology, criteria and the formula of 60 : 40 was communicated to all the concerned on 14.12.2005 which plea is not acceptable to us because record does not reveal the same. In the absence of such a communication the contention that the decision makers applied hidden criteria evolved as a tailor made to suit the 4th respondent acquires legitimacy. We accordingly hold that the procedure adopted by the decision makers is vitiated by the application of hidden criteria, lack of transparency and accountability. Procedural impropriety is writ large on the face of the record." 18. We accordingly hold that the procedure adopted by the decision makers is vitiated by the application of hidden criteria, lack of transparency and accountability. Procedural impropriety is writ large on the face of the record." 18. There can hardly be any doubt about the fact that the tendering authorities would be at liberty to decide the terms and conditions in a tender and also decide as to what criteria should be employed for evaluation of the bids. However, whatever terms and conditions the authorities choose to adopt for processing the bids must be notified in the Tender Notice itself or at-least informed to the bidders at any stage prior to the submission of the bid by giving sufficient notice to the intending tenderers in respect thereof. The Tendering authorities cannot evolve bid evaluation criteria subsequent to the opening of the bid nor can they employ un-disclosed criteria for evaluation of the bids so as to reject a tender for such a recourse would not only be unfair to the bidders but would also be violative of the rules of transparency. Fairness and reasonableness in state action are necessary so as to ensure equality within the meaning of Article 14 of the Constitution and therefore, fairness, openness and transparency are like the hallmark of purity in a tender process conducted by the state or its instrumentality. 19. In the instant case, what was indicated in the tender notice is that bids that are found to be quoting abnormally high amount would be liable to be rejected. What amount would be considered as " abnormal" had not been indicated anywhere in the tender notice. The term abnormal is an amorphous quantity for the purpose of evaluation of the bids. Inserting tender conditions that are amorphous in nature only leaves room for manipulation leading to favouritism. If the decision of the tendering authority was to reject bids that were more then double the government schedule rate then, fairness demanded that the said condition be clearly spelt out in the Tender Notice itself since such a criteria would come into play for rejecting the bids. It is the admitted position of fact that the bidders had not been informed about such a evaluation criteria before submission of the bid. It is the admitted position of fact that the bidders had not been informed about such a evaluation criteria before submission of the bid. Having failed to clearly mention such bid evaluation criteria prior to submission of the tenders, evolving and employing a new criteria for evaluation/ rejection of the tenders after the bids were opened and the rates were known would amount to changing the rules of the game after it has been played. 20. Coming to the facts of WP(C) No. 3476/2014 the settlement was awarded in favour of the respondent No. 5 who had quoted an amount of Rs. 5,00,000 and was the third highest bidder. In the comparative analysis it was found that the document submitted by him were also not in order. The Government scheduled rate in respect of the market in question was fixed at Rs. 1,33,100 (Rupees One Lac Thirty Three Thousand One Hundred). Therefore, even if the stand taken by the respondents is taken on the face value that the Resolution No. 3 as appearing in the minutes of meeting dated 01.07.2014 was the basis for evaluation of the bids that lead to the elimination of the petitioners, even in that case the settlement of the market in favour of the respondent no 5 would stand completely vitiated by the own showing of the respondents since the bid quoted by the respondent No. 5 is evidently more than double the Government scheduled rate of Rs. 1,33,100. Moreover, there is absolutely no explanation as to why the settlement was awarded in favour of the respondent No.5 despite having found that the documents submitted by him were not in order. 21. Similarly, in the WP(C) No. 3469/2014 the petitioner had quoted a price of Rs. 51,749 whereas the respondent No. 5 had quoted a price of Rs. 50,501. Since the Government scheduled rate for the said market was fixed at Rs. 25,875, hence, the price quoted by the petitioner was definitely not more than double the Government scheduled rate. There is no explanation furnished by the respondents as to on what basis the bid submitted by the petitioner in this case was rejected despite being the highest bidder and notwithstanding the fact that his bid did not violate resolution No. 3 of the minutes of meeting dated 01.07.2014 . 22. There is no explanation furnished by the respondents as to on what basis the bid submitted by the petitioner in this case was rejected despite being the highest bidder and notwithstanding the fact that his bid did not violate resolution No. 3 of the minutes of meeting dated 01.07.2014 . 22. If the respondents wanted to put a ceiling on the maximum amount that can be quoted by a tenderer, then, such decision and/or ceiling ought to have been notified in clear terms to the bidders. Even assuming that the said exercise could not have been carried out for any valid reason before the submission of the bids, fairness demanded that the highest bidders ought to have been given an option to reduce their price so as to match the condition imposed by resolution No. 3 of the minutes of meeting dated 01.07.2014. There is no explanation as to why no such opportunity was given to the highest bidders. On the contrary, what has been done is that the highest bidders in both the cases have been completely eliminated from the process after the opening of the bids by employing newly evolved evaluation criteria and thereafter the settlement has been awarded to respondent No. 5, who had quoted price much lower than the petitioners. Whatever be the ground realities prevailing in the BTC area, such local factors cannot afford a reasonable basis for the authorities to undermine the requirement of adherence to the rules of fairness, openness and transparency in a tender process. 23. In view of the discussions made herein before, this Court is of the opinion that the decision of the respondent authorities to award the settlement of the respective markets in favour of the private respondents by ignoring the petitioners' bids is vitiated by complete illegality and arbitrariness. The manner of processing the bids have been found to completely non-transparent. The action on the part of the respondent authorities leaves an impression of favouritism and discrimination against the writ petitioners and hence, the same cannot be countenanced by this Court. In that view of the matter the impugned settlement of the markets awarded in favour of the respondent No. 5 in both the cases are hereby set aside. 24. The action on the part of the respondent authorities leaves an impression of favouritism and discrimination against the writ petitioners and hence, the same cannot be countenanced by this Court. In that view of the matter the impugned settlement of the markets awarded in favour of the respondent No. 5 in both the cases are hereby set aside. 24. Having regard to the fact that the term of settlement for 2014-2015 is nearing its completion in the month of June, 2015, this court is not inclined to issue any direction for settling the markets in favour of the writ petitioner. However, the respondents are directed to float fresh tenders for settlement of the markets in question by clearly indicating the terms and conditions including the evaluation criteria, if any, in the Tender Notice itself. The said process would be completed within a period of two months from today. The respondent No. 4 may make alternate arrangements for running the markets in question until the time the tender process, as directed above, is completed. Both the writ petitions stand allowed to the extent indicated here-in-before. No order as to cost.