Standard Erector, Panipat v. Haryana Power Generation Corporation Ltd. , Panchkula
2016-08-17
AJAY KUMAR MITTAL, RAMENDRA JAIN
body2016
DigiLaw.ai
JUDGMENT : AJAY KUMAR MITTAL, J. 1. In this writ petition filed under Articles 226/227 of the Constitution of India, the petitioner prays for issuance of a writ in the nature of certiorari for quashing the condition that the bidder should have minimum two years experience of operation and maintenance of DM plants (Demineralization Plant) with minimum capacity of 30m3/hr per stream in the preceding 5 years from the date of opening of Techno Commercial/Part-I bid in any Thermal Power Station/National Thermal Power Corporation Govt. Organization/Electricity Board having generating unit of 210 MW or above. Further, the bidder should have successfully executed single work order of Rs. 29,47,200/- or above in a year. 2. A few facts necessary for adjudication of the instant petition as narrated therein may be noticed. The respondents vide tender document dated 23.6.2016 (Annexure P-1) invited tenders for Annual Running Contract for operation of clarifiers, chlorination plants, collection of water sample, collection of raw coal sample from each running feeder of unit 5 to 8, operation of affluent treatment plant, CW Chemical Treatment of Unit 7 and 8 of PTPS, Panipat. The respondents while issuing the tender document, Annexure P-1, have put one of the following conditions:- “The bidder should have minimum two years experience of operation and maintenance of DM plants with minimum capacity of 30m3/hr per stream in the preceding 5 years from the date of opening of Techno Commercial/Part-I bid in any Thermal Power Station/ NTPC Govt. Organization/Electricity Board having generating unit of 210 MW or above. Further, the bidder should have successfully executed single work order of Rs. 29,47,200/- or above in a year and shall submit copies of performance certificate/repeat work order from the same organization. The annual turnover of bidder should be minimum Rs. 2,21,04,000/- during preceding three financial years, for which the bidder shall submit certified copies from Chartered Accountant.” 3. The said condition do not have any nexus or connection with the scope of the work and had been taken from a tender document 27.5.2016 (Annexure P-2) issued by Rajiv Gandhi, Thermal Power Plant, Khedar, Hisar and had been pasted in the tender document, Annexure P-1. The petitioner applied for the tender document by disclosing its experience of two years and nine months of DM Plants at the PTPS Plant, Panipat and had also conducted work orders (Annexure P-3 Colly) amounting to Rs.
The petitioner applied for the tender document by disclosing its experience of two years and nine months of DM Plants at the PTPS Plant, Panipat and had also conducted work orders (Annexure P-3 Colly) amounting to Rs. 30,92,709/- without any break at PTPS, Panipat. Respondent No.4 vide e-mail dated 11.8.2016 (Annexure P-4) asked the petitioner to submit various documents which were already in their knowledge and have already been submitted by the petitioner. Prior to the tender document, Annexure P-1, the petitioner was also conducting this work in PTPS, Panipat and till date such condition had never been imposed as is discernible from the tender documents dated 20.5.2014 (Annexure P-5) and dated 16.7.2014 (Annexure P-6). Hence, the present writ petition. 4. Learned counsel for the petitioner submitted that the condition of two years experience in the Operation and Maintenance of demineralization plant as noticed above is not in consonance with the scope of the work required by the respondents. 5. We have heard learned counsel for the petitioner and do not find any merit in the submission made by him. 6. The respondents had issued a tender document, Annexure P-1 for Annual Running Contract for operation of clarifiers, chlorination plants, collection of water sample, collection of raw coal sample from each running feeder of unit 5 to 8, operation of affluent treatment plant, CW Chemical Treatment of Unit 7 and 8 of PTPS, Panipat. They had put a condition of having two years experience of operation and maintenance of DM plants with minimum capacity of 30m3/hr per stream in the preceding 5 years from the date of opening of Techno Commercial/Part I bid in any Thermal Power Station/NTPC Govt. Organization/Electricity Board having generating unit of 210 MW or above. Further, the bidder should have successfully executed single work order of Rs. 29,47,200/- or above in a year. It was within the domain of the respondents to have put the conditions in the advertisement. No material was produced to show that there was any malafide in putting the said condition by the respondents or it was to benefit a particular applicant. Once it is so, the imposition of aforesaid condition could not be faulted. 7.
It was within the domain of the respondents to have put the conditions in the advertisement. No material was produced to show that there was any malafide in putting the said condition by the respondents or it was to benefit a particular applicant. Once it is so, the imposition of aforesaid condition could not be faulted. 7. The Apex Court in Maa Binda Express Carrier and another v. North East Frontier Railway and others' (2014) 2 CHN 96 (SCC) with regard to the scope of judicial review in contractual matters, inter alia, noticed that for formulating conditions of a tender document and awarding a contract, the State authorities are required to be conceded greater latitude and their action is not open to judicial review unless it can be demonstrated to be malicious, arbitrary, unreasonable or misuse of its statutory powers. The relevant observations recorded therein are extracted as under:- 10. The scope of judicial review in contractual matters was further examined by this Court in Tata Cellular v. Union of India (1994) 6 SCC 651 , Raunaq International Ltd.’s case (supra) and in Jagdish Mandal v. State of Orissa and Ors. (2007) 14 S CC 517 besides several other decisions to which we need not refer. 11. In Michigan Rubber (India) Ltd. v. State of Karnataka and Ors. (2012) 8 SCC 216 the legal position on the subject was summed up after a comprehensive review and principles of law applicable to the process for judicial review identified in the following words: (SCC p. 229 paras 19-20) “19. 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. 20. Therefore, a Court before interfering in tender or contractual matters, in exercise of power of judicial review, should 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 or 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"; and (ii) Whether the public interest is affected. If the answers to the above questions are in negative, then there should be no interference under Article 226.” (emphasis supplied) 12. As pointed out in the earlier part of this order the decision to cancel the tender process was in no way discriminatory or mala fide. On the contrary, if a contract had been awarded despite the deficiencies in the tender process serious questions touching the legality and propriety affecting the validity of the tender process would have arisen. In as much as the competent authority decided to cancel the tender process, it did not violate any fundamental right of the appellant nor could the action of the respondent be termed unreasonable so as to warrant any interference from this Court. The Division Bench of the High Court was, in that view, perfectly justified in setting aside the order passed by the Single Judge and dismissing the writ petition.” 8.
The Division Bench of the High Court was, in that view, perfectly justified in setting aside the order passed by the Single Judge and dismissing the writ petition.” 8. For the failure of the petitioner to substantiate the impugned condition as reproduced above was un-reasonable, malicious or misuse of statutory powers of Government authorities, we do not find any ground to interfere with the tender document, Annexure P-1. Consequently, finding no merit in the writ petition, the same is hereby dismissed.