Krishna Sanitation Society Jatroon v. State of Himachal Pradesh
2016-12-09
SANDEEP SHARMA, TARLOK SINGH CHAUHAN
body2016
DigiLaw.ai
JUDGMENT : Sandeep Sharma, J. 1. Instant petition under Article 226 of the Constitution of India has been filed seeking following main reliefs: "(i) That the impugned order dated 26.9.2016 may kindly be quashed and set-aside. (ii) That the respondents may kindly be directed to issue award letter in favour of the petitioner within time bound period as he fulfill all the conditions including the experience certificate as one the condition. (iii) That the respondents may kindly be restrained from inviting fresh tender in the matter." 2. Briefly stated the facts of the case are that the petitioner-society i.e. Krishna Sanitation Society Jatroon, which is registered under Societies Registration Act, 2006, pursuant to Short Tender Notice (Annexure P-2) issued by the Secretary, Nagar Panchayat, Chowari, submitted its tender for the following works:- S. No. Name of Work Man Power Required Earnest Money Time Limits 1. Cleanliness area Ward No-01 Sudali Chownk to Hanuman Chownk, Hanuman Chownk to Puran Chand Secretary House, Hanuman Chownk to Referral Hospital Chowari, Main Nazar alongwith All Drains and Roads. Ward No-05:- Sadwan Raipur Road to Senior Secondary School. Ward No-07:-Sh. Surnder Sharma Shop to Saran Dass Verma House, Vidya Sagar Shop to Mahila Mandal, Chharmari area. Ward No-06:-Complete Ward. The Drains/Path and Street of above said wards alongwith Loading and unloading of Garbage. Rehan Basera and Office Building 10 Nos. + 01 Supervisor 22000-00 One year 2. Door to Door Garbage collection in Ward No-01 and Ward No-07 02 Nos. 5000-00 One year 3. Petitioner claimed that its tender being the lowest was accepted by the respondents on 29.6.2016 and as such it was expecting that award letter would be issued to it immediately, but when it was not issued, petitioner made inquiries from the respondents. On inquiry, petitioner was informed that one M/s J.S. Constructions had filed a complaint to the respondents (Annexure P- 4) alleging therein that the tender submitted by the, Krishan Pal Singh, President of the petitioner-Society was faulty because the experience certificate submitted by it prima facie appeared to be fictitious and as such work in terms of Short Tender Notice could not be awarded to the petitioner-Society. In the complaint, complainant alleged that Sulabh International had actually issued certificate of experience of work till 2008 but there is over-writing.
In the complaint, complainant alleged that Sulabh International had actually issued certificate of experience of work till 2008 but there is over-writing. Similarly, complainant alleged that there is contradiction in the PAN card and experience certificate having been furnished by the petitioner society. On the basis of aforesaid complaint, respondents decided not to award work in favour of the petitioner-society. Petitioner being aggrieved of the aforesaid action of not awarding tender in its favour, despite its being lowest bidder approached this Court by way of CWP No. 2492 of 2016, which came to be listed before this Court on 26.9.2016. This Court, on the basis of averments contained in the petition, directed the respondents to seek instructions on 27.9.2016. On 27.9.2016, this Court was informed that the respondents have already passed order dated 26.9.2016 (Annexure P-6), whereby decision has been taken to cancel the tenders on administrative and technical grounds. Perusal of letter dated 26.9.2016 further suggests that decision was taken to invite tender through e-tendering process in terms of instructions issued by the Government. In view of aforesaid, petitioner sought permission to withdraw the petition with liberty to file afresh laying therein challenge to order dated 26.9.2016. In the aforesaid background, present petitioner approached this Court by way of present petition, praying therein for the reliefs as reproduced above. 4. Mr. Nipun Sharma, learned counsel representing the petitioner, vehemently argued that cancellation order issued by the respondents is not tenable as it does not disclose any reason, much less sufficient reason, to cancel the tender on administrative/technical grounds. Mr. Nipun Sharma, while inviting attention of this Court to the experience certificates purportedly annexed by the petitioner alongwith tender document, (pages-22 and 23 of the paper-book) vehemently argued that reasons cited in the cancellation order (Annexure P-6) are not tenable, rather tender has been cancelled by the respondents to favour other contractors, who were unable to succeed in the bidding process. 5. Mr. Rupinder Singh Thakur, Additional Advocate General appearing for the State and Mr. Anup Rattan, Advocate appearing for respondent no.
5. Mr. Rupinder Singh Thakur, Additional Advocate General appearing for the State and Mr. Anup Rattan, Advocate appearing for respondent no. 2, supported the cancellation order (Annexure P-6) and stated that in view of reasons cited in the cancellation order, petitioner has no right to claim work in terms of tender notice because it stands duly proved on record that petitioner had failed to submit experience certificate in sanitation work for the last two years, in the name of the firm alongwith PAN and EPF number. Mr. Rupinder Singh, Additional Advocate General and Mr. Anup Rattan, Advocate, with a view to refute the contentions having been put forth by Mr. Nipun Sharma, Advocate, specifically referred to the experience certificate allegedly annexed with tender documents by the petitioner (page 23) to demonstrate that same was not issued in favour of the petitioner, rather same was issued individually in favour of Shri Krishan Pal Singh son of Shri Sagar Singh, resident of Chowari, District Chamba, who, undisputedly, happens to be the President of the petitioner-society. Mr. Thakur further argued that bare perusal of experience certificate issued by International Institute of Sulabh System Delhi clearly establishes the allegations of the complainant M/s J.S. Constructions that the same is fictitious because perusal of same clearly suggests that there is over-writing on date. While concluding his arguments, Mr. Thakur stated that since decision has been taken to cancel the tender, present petition deserves to be dismissed having been rendered infructuous. 6. We have heard the learned counsel for the parties and also gone through the records. 7. It is undisputed that pursuant to Short Tender Notice admittedly issued by the respondents i.e. Nagar Panchayat, Chowari, petitioner society applied for work in question and it was found to be the lowest bidder. Similarly, terms and conditions as contained in Short Tender Notice are reproduced herein below: “TERM AND CONDITIONS FOR CLEANLINESS OF TOWN FOR 2016-17 1. The contractor will ensure to cleanliness of town i.e. Cleanliness of Town Ward No. 1, 05, 06, 7, alognwith all drains and streets, Rehan Basera and N.P. office. 2. The contactor has to submit experience Certificate in sanitation work at least 2 years. Alongwith PAN Number, EPF Number. 3. The whole area will be inspected by the Sanitary Supervisor with the contractor/ Supervisor daily. 4. No negligence regarding cleanliness of the town will accept.
2. The contactor has to submit experience Certificate in sanitation work at least 2 years. Alongwith PAN Number, EPF Number. 3. The whole area will be inspected by the Sanitary Supervisor with the contractor/ Supervisor daily. 4. No negligence regarding cleanliness of the town will accept. If the cleanliness work of the area affected the tenders will be cancelled within 24 hours without any notice. 5. No gagbage should be visible in the area slop area if visible the area will be cleaned by the workers, f the contractor. 6. The conservancy material viz. shawls, Brooms, Wheel Barrows, Buckets, Phynile, Acid and other material which will be essential for cleanliness will be provided by the contractor. 7. Polythene bags of the area should be collected by the contractors staff and no polythene bags should be visible any where. 8. Since the sanitation work is essential services as such the garbage/refuse removed through Municipal agency. In case of emergency will be done at the cost of the contractor. 9. The contractor will supply the detail of employees i.e. Name of employee, Complete address Identity of employee and location of work place alongwith their Mobile numbers. 10. The next month payment will only be release on the receipt of previous month EPF return and on the basis of daily attendance of workers after the satisfaction/verification of the Sanitary Supervisor.” 8. The aforesaid conditions suggest that contractor was required to submit experience certificate for two year in sanitation work alongwith PAN and EPF number. In the instant case, as has emerged from the record, respondents, after completion of bidding process, received complaint from M/s J.S. Contractions and Maharishi Enterprises (Annexure P-4) that the experience certificate submitted by the petitioner-society are fictitious and same can not be taken into consideration while considering the bid of the petitioner-society. 9. True, it is that aforesaid complainants also participated in the tendering process and as such there can be every possibility of lodging false complaint by it against petitioner being competitor but perusal of reply having been filed by the respondents clearly suggests that the petitioner failed to submit two years experience certificate in the name of petitioner-society as was required in terms of Short Tender Notice.
Perusal of experience certificate tendered by the petitioner with the tender document clearly suggests that one of the certificate was not in the name of the petitioner-society, which had actually applied in terms of Short Tender Notice, rather the experience certificate purportedly issued by International Institute of Sulabh System Delhi is/was in favour of Krishan Pal singh son of Sagar Singh, in his individual capacity and not in the name of petitioner-Society i.e. Krishna Sanitation Society. Since tender was submitted in the name of petitioner-Society, it was incumbent upon the petitioner society to place on record certificate, if any, in its favour and not in the name of Shri Krishan Pal singh, who happens to be the President of the Society. Moreover, perusal of experience certificate (page 23) shows that there is over-writing on date as such this Court sees no illegality and infirmity in the action of the respondents in rejecting the tender of petitioner for non-compliance of terms and conditions of Short Tender Notice. 10. Similarly, perusal of certificate (Annexure P-7), which has been issued by Senior Medical Officer, Chowari suggests that same has been issued in the name of Sh. Krishan Pal Singh and not in the name of petitioner-society and same is of no help to the petitioner-society. 11. Apart from above, perusal of impugned order dated 26.9.2016 (Annexure P-6) clearly suggests that tender in question was opened on 29.6.2016 in the office of Nagar Panchayat, Chowari in the presence of applicants i.e. contractors. Five contractors submitted tenders and out of five, three contractors failed to produce the experience certificate as such their bids were not considered. So far as remaining two contractors are concerned, though the petitioner-society was found to be lowest but since it did not furnish certificate as per terms and conditions of tender notice, same was also rejected. Impugned order clearly suggests that petitioner-society had submitted experience certificate of only one year, which was issued by Secretary, Nagar Panchayat, Chowari available at page 22, perusal where suggests that M/s Krishna Sanitation Soceity worked with Nagar Panchayat for one year i.e. November, 2013 to October, 2014 for cleaning and sweeping of Nagar Panchayat area. Since aforesaid certificate in the name of petitioner-society was only for one year, no fault can be found with the decision of respondents in rejecting tender of the petitioner-society for violation of terms and conditions of Short Tender Notice.
Since aforesaid certificate in the name of petitioner-society was only for one year, no fault can be found with the decision of respondents in rejecting tender of the petitioner-society for violation of terms and conditions of Short Tender Notice. 12. Similarly, since another tenderer M/s J.S. Constructions though was second lowest but it also did not furnish experience certificate, as such its tender was also rejected. Perusal of aforesaid communication clearly suggests that none of the contractors, who had actually submitted bids in terms of tender notice fulfilled the terms and conditions, accordingly, respondents decided to cancel the tender on administrative and technical grounds and decided to initiate tender process through e-tendering system, in terms of instructions issued by the Government. 13. This Court, after carefully examining the impugned order passed by the respondents, sees no force in the contentions having been raised on behalf of the petitioner that action of the respondents is discriminatory and is the result of colourable exercise of power. Rather, this Court after perusing impugned order, is satisfied and convinced that since all the bidders failed to fulfill the conditions of tender notice, respondents rightly decided to cancel the tender. As such, there is no merit in the petition. 14. Further, by no stretch of imagination, court can assume the role of technical expert, who in their wisdom have cancelled the tender on account of technical/administrative reasons. Since respondents have already taken a conscious decision to recall the tender, this Court sees no occasion to grant relief as prayed for in the petition. 15. It is well settled by now that respondents can withdraw /recall tender at any time, if it is convinced that same is not in accordance with the requirements as indicated in Notice Inviting Tender. Though, in the present case, petitioner claimed himself to be lowest bidder but there is no document suggestive of the fact that pursuant to opening of his tender, he was awarded work, as such no right has accrued in his favour which would have entitled him to claim the relief as prayed for in the petition. 16. The Apex Court in State of Jharkhand vs. M/s. CWESOMA Consortium, reported in AIR 2016 SCW 3366, has held that: 13. The appellant-state was well within its rights to reject the bid without assigning any reason thereof.
16. The Apex Court in State of Jharkhand vs. M/s. CWESOMA Consortium, reported in AIR 2016 SCW 3366, has held that: 13. The appellant-state was well within its rights to reject the bid without assigning any reason thereof. This is apparent from clause 24 of NIT and clause 32.1 of SBD which reads as under:- “Clause 24 of NIT: “Authority reserves the right to reject any or all of the tender(s) received without assigning any reason thereof.” Clause 32.1 of SBD: “…the Employer reserves the right to accept or reject any Bid to cancel the bidding process and reject all bids, at any time prior to award of Contract, without thereby incurring any liability to the affected Bidder or Bidders or any obligation to inform the affected Bidder or Bidders of the grounds for the Employer’s action.” In terms of the above clause 24 of NIT and clause 32.1 of SBD, though Government has the right to cancel the tender without assigning any reason, appellant-state did assign a cogent and acceptable reason of lack of adequate competition to cancel the tender and invite a fresh tender. The High Court, in our view, did not keep in view the above clauses and right of the government to cancel the tender. 14. The State derives its power to enter into a contract under Article 298 of the Constitution of India and has the right to decide whether to enter into a contract with a person or not subject only to the requirement of reasonableness under Article 14 of the Constitution of India. In the case in hand, in view of lack of real competition, the state found it advisable not to proceed with the tender with only one responsive bid available before it. When there was only one tenderer, in order to make the tender more competitive, the tender committee decided to cancel the tender and invited a fresh tender and the decision of the appellant did not suffer from any arbitrariness or unreasonableness. 17. That Apex Court in Bakshi Security & Personnel Services Pvt. Ltd. vs. Devkishan Computed Pvt. Ltd. reported in AIR 2016 SCW 3385, has held that: 13. First and foremost, under tender condition 2.5.5, commercial bids have to strictly conform to the format provided in Annexure 2 of the tender document.
17. That Apex Court in Bakshi Security & Personnel Services Pvt. Ltd. vs. Devkishan Computed Pvt. Ltd. reported in AIR 2016 SCW 3385, has held that: 13. First and foremost, under tender condition 2.5.5, commercial bids have to strictly conform to the format provided in Annexure 2 of the tender document. Annexure 2 which contains the format for the price bid makes it clear that the salary paid to deployed manpower should not be less than the minimum wage. It further goes on to state in paragraph 3 thereof that if the component of salary quoted is less than the minimum wage prescribed, the bid is liable to be rejected. On this ground alone, Respondent No. 1's bid is liable to be rejected inasmuch as, vide its letter dated 3.9.2015, Respondent No. 1 stuck to its original figure of Rs.2,77,68,000/- which is way below the minimum wage fixed by the Government. Secondly, Shri Raval is also right in stating that the without prejudice offer of Rs.3,00,92,346/- is an offer which is not fixed, but open ended. This is clear from the fact that it was up to the Government then to pick up either figure by way of acceptance. This is clearly interdicted by clause 2.5.6 of the tender which states that prices quoted by the bidder have to be fixed, and no open ended bid can be entertained, the same being liable to be rejected straightaway. Such condition is obviously an essential condition of the tender which goes to the eligibility of persons who make offers under the tender. 14. Unfortunately, even though the High Court noticed the open ended nature of Respondent No. 1's bid, it went on to add that the offer of Respondent No. 1 shall be treated as matching with the revised minimum wage calculation and that it is nowhere envisaged by the tender conditions that rejection of an offer which may have the potential of causing loss to the tenderer is present. It is not for the High Court to revisit a condition contained in Annexure 2 read with 2.5.5 of the tender in the manner aforesaid.
It is not for the High Court to revisit a condition contained in Annexure 2 read with 2.5.5 of the tender in the manner aforesaid. Once the tender condition states that the tender must strictly conform to the format provided in Annexure 2, and Annexure 2 in turn clearly states that if the component of salary quoted is less than the minimum wage prescribed, the bid is liable to be rejected, and the High Court cannot hold otherwise. The High Court’s further finding that Respondent No. 1's offer was “clear” is wholly incorrect. It was a without prejudice offer which muddied the waters and rendered the price quoted by the bidder as variable and not fixed. 18. The Apex Court in Central Coalfields Limited vs. SLL-SML (Joint Venture Consortium) reported in AIR 2016 SCW 3814, has further held that: 44. On asking these questions in the present appeals, it is more than apparent that the decision taken by CCL to adhere to the terms and conditions of the NIT and the GTC was certainly not irrational in any manner whatsoever or intended to favour anyone. The decision was lawful and not unsound. 55. On the basis of the available case law, we are of the view that since CCL had not relaxed or deviated from the requirement of furnishing a bank guarantee in the prescribed format, in so far as the present appeals are concerned every bidder was obliged to adhere to the prescribed format of the bank guarantee. Consequently, the failure of JVC to furnish the bank guarantee in the prescribed format was sufficient reason for CCL to reject its bid. 56. There is nothing to indicate that the process by which the decision was taken by CCL that the bank guarantee furnished by JVC ought to be rejected was flawed in any manner whatsoever. Similarly, there is nothing to indicate that the decision taken by CCL to reject the bank guarantee furnished by JVC and to adhere to the requirements of the NIT and the GTC was arbitrary or unreasonable or perverse in any manner whatsoever.” 19. Admittedly, Court can go into the question of mala-fides raised by a litigant, but in order to succeed, much more than a mere allegation is required.
Admittedly, Court can go into the question of mala-fides raised by a litigant, but in order to succeed, much more than a mere allegation is required. Bald and unfounded allegations of mala-fides are not sustainable and that mala-fides must be specifically pleaded and proved and such allegations of mala-fides should be made with all sense of responsibility, otherwise, the maker of such allegations should be ready to face consequences. 20. It is equally well settled that the burden of proving mala-fides is on the person making the allegations and the burden is very heavy. Reliance is placed upon E.P. Royappa vs. State of Tamil Nadu, (1974) 4 SCC 3 . 21. There is every presumption in favour of the administration that the power has been exercised bona-fide and in good faith. It is to be remembered that the allegations of mala-fides are often more easily made than proved and proof of high degree is required to prove the same. Reliance is also placed on Gulam Mustafa vs. State of Maharashtra, (1976) 1 SCC 800 wherein it is held: “It (mala-fides) is the last refuge of a losing litigant.” 22. Reliance is also placed on Union of India and Others vs. Ashok Kumar and Others, (2005) 8 SCC 760, whereby it is held by the Apex Court that seriousness of allegations of mala-fides demands proof of high order of credibility and the Courts should be slow to draw dubious inferences from incomplete facts placed before them by a party, particularly when the imputations are grave and they are made against the holder of an office having high responsibility. It was held: “21. Doubtless, he who seeks to invalidate or nullify any act or order must establish the charge of bad faith, an abuse or a misuse by the authority of its powers. While the indirect motive or purpose, or bad faith or personal ill-will is not to be held established except on clear proof thereof, it is obviously difficult to establish the state of a man's mind, for that is what the employee has to establish in this case, though this may sometimes be done. The difficulty is not lessened when one has to establish that a person apparently acting on the legitimate exercise of power has, in fact, been acting mala-fide in the sense of pursuing an illegitimate aim.
The difficulty is not lessened when one has to establish that a person apparently acting on the legitimate exercise of power has, in fact, been acting mala-fide in the sense of pursuing an illegitimate aim. It is not the law that mala-fide in the sense of improper motive should be established only by direct evidence. But it must be discernible from the order impugned or must be shown from the established surrounding factors which preceded the order. If bad faith would vitiate the order, the same can, in our opinion, be deduced as a reasonable and inescapable inference from proved facts. (S. Pratap Singh vs. State of Punjab, AIR 1964 SC 72 ). It cannot be overlooked that burden of establishing mala-fides is very heavy on the person who alleges it. The allegations of mala-fides are often more easily made than proved, and the very seriousness of such allegations demand proof of a high order of credibility. As noted by this Court in E.P. Royappa vs. State of Tamil Nadu and Another, AIR 1974 SC 555 , Courts would be slow to draw dubious inferences from incomplete facts placed before it by a party, particularly when the imputations are grave and they are made against the holder of an office which has a high responsibility in the administration. (See Indian Railway Construction Co. Ltd. vs. Ajay Kumar, (2003) 4 SCC 579 ).” 23. Courts can interfere in tender or contractual matters in exercise of power of judicial review only in case the process adopted or decision made by the authority is mala-fide or intended to favour someone or the process adopted or decision made is so arbitrary and irrational that no responsible authority acting reasonably and in accordance with relevant law could have reached and lastly in case the public interest is affected. If the answers to these questions are in the negative, then there should be no interference by this Court in exercise of its powers under Article 226 of the Constitution of India. 24. Principles of judicial review under Article 226 of the Constitution of India would apply to the exercise of contractual powers by the Government only in case the process adopted or decision making process of the authorities is wrong and illegal and in order to prevent arbitrariness or favoritism. 25.
24. Principles of judicial review under Article 226 of the Constitution of India would apply to the exercise of contractual powers by the Government only in case the process adopted or decision making process of the authorities is wrong and illegal and in order to prevent arbitrariness or favoritism. 25. Reliance is further placed on Tata Cellular vs. Union of India, (1994) 6 SCC 651 , whereby Apex Court has laid down the limitations in relation to the scope of judicial review of administrative decisions in exercise of powers awarding contracts: (SCC pp 687-88, para 94) 26. In the instant case, the decision regarding cancellation of the tender is a bona-fide one and is otherwise in the larger public interest because none of the bidders including the petitioner fulfilled the tender condition and as such for a fair and transparent tendering, Department cancelled the tender and decided to resort to e-tendering. Further, e-tendering would increase healthy competition amongst the participants, thereby saving the public exchequer. It is not a fit case to exercise powers of judicial review as there is no violation of the provisions of law and further there is no procedural aberration or error in assessment. It is more than settled that power of judicial review will not be permitted to invoke to protect private interest at the cost of public interest and reliance is placed on a judgment delivered by the Apex Court in Jagdish Mandal vs. State of Orissa and Others, (2007) 14 SCC 517 wherein the Hon’ble Supreme Court has held that before interfering in tender or contractual matters in exercise of judicial review, Courts should ascertain whether process adopted or decision made by the authority is mala-fide or intended to favour some and whether process adopted or decision made is so arbitrary and irrational that the Court can say that the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached and also whether public interest is affected. 27. Applying the aforesaid test to the instant case, the writ petition merits to be dismissed and is accordingly dismissed. Pending applications, if any, are also disposed of.