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2016 DIGILAW 748 (ORI)

Pramod Kumar Sahu v. State of Orissa

2016-09-07

B.R.SARANGI, VINEET SARAN

body2016
JUDGMENT : B.R. SARANGI, J. Both the above mentioned writ petitions involve same questions of fact and law excepting the work for which bids were invited and, as such, they are heard together and disposed of by this common judgment. 2. For the sake of convenience and better appreciation, W.P.(C) No. 9849 of 2016 is considered as a lead case and facts of the said case have been referred to. The Project Administrator, Integrated Tribal Development Agency (ITDA), Baliguda-opposite party no.3 floated a tender vide Bid Identification No. PA(ITDA)-BLGD-3/15-16 Letter No. 485/ITDA, dated 19.02.2016 inviting bids from the eligible contractors for the purpose of execution of different works in the district of Kandhamal. The tender notice itself stipulated terms and conditions with regard to eligibility for offering bids, where it is stated that SC & ST contractors have to submit an affidavit that they have not availed such benefit for more than two works during the current financial year for the purpose of availing price preference. The petitioner, an ‘A’ Class contractor, belonging to general category offered his bid in respect of the work “Construction of Ashram School (Academic block & Staff Qtr. ‘B’ Type) for PVTG Area at Rangaparu under Tamudibandha Block”. On consideration of the bids submitted by the petitioner as well as others, the State-opposite parties found the petitioner as L-1 tenderer in respect of the aforesaid work with 5.8 % less. Accordingly, the State-opposite parties vide letter no. 906/ITDA dated 08.04.2016 intimated the petitioner that he being the 1st lowest bidder has to attend the office of opposite party no.3 to execute agreement on his quoted rate with required ISD and original documents within seven days of receipt of the letter and he was also asked to submit his work programme in respect of the project in the form of an affidavit in non-judicial stamp paper of required amount during the time of agreement. The said letter was received by the petitioner on 18.04.2016. In response to the aforesaid letter dated 08.04.2016, the petitioner complied with the entire requirements including the signing of the agreement from his side and also submitted the work programme vide his letter dated 22.04.2016 and requested the State-opposite parties to provide him the copy of the agreement, work order, estimate and lay out for the purpose of commencing execution of the work. Such letter having been acknowledged by opposite party no.4, opposite party no.3 vide letter dated 23.04.2016 intimated that due to some unavoidable circumstances the agreement was to be executed after few days and the next date for signing of agreement will be intimated to him. As per the terms and conditions of the tender call notice, the agreement ought to have been executed within three days following the selection of the petitioner. As the work order was not issued in favour of the petitioner, he approached this Court by filing W.P.(C) No.9127 of 2016 praying therein for direction to the State opposite parties to issue work order in his favour. While the matter stood thus,, opposite party no.3 vide its letter No. 1223/ITDA dated 24.05.2016, which was received by the petitioner on 27.05.2016, intimated that the selection of the petitioner as L-1 bidder, as communicated vide letter dated 08.04.2016, has been cancelled, and that as per the resolution dated 11.10.1977 opposite party no.6 is entitled to price preference of 10% being S.C. contractor and the OPWD Manual published in the website giving 5% price preference has not yet been finalized and it is only a draft proposal, as clarified by the Under Secretary to the Government, Works Department in its letter dated 06.05.2016. Being aggrieved by such action of opposite party no.3, the petitioner has approached. 3. In so far as W.P.(C) No.9847 of 2016 is concerned, the same has been filed by the selfsame petitioner in respect of the work “Construction of Ashram School (Hostel Block) for work PVTG area at- Rangapara under Tumudibandha Block”. 4. We have heard learned counsel for the parties and the pleadings between the parties having been exchanged, with the consent of learned counsel for the parties both the matters are disposed of at the stage of admission. 5. Mr. S.K. Mishra, learned counsel for the petitioner urged that though the resolution dated 11.10.1977 grants concession to Schedule Caste and Schedule Tribe Contractors, so far as 10% price preference is concerned, the same has been withdrawn vide Circular dated 24.05.2001 and the Engineer Contractors belonging to SC & ST category are given only 5% price preference. Similarly, in the ITDA project at Jaypore, 5% price preference benefit has been given to SC & ST contractors as per the Codal provision of OPWD Manual, which was published in the website in the year 2014. Similarly, in the ITDA project at Jaypore, 5% price preference benefit has been given to SC & ST contractors as per the Codal provision of OPWD Manual, which was published in the website in the year 2014. In the instant advertisement, whereby tenders were invited, there was no stipulation with regard to grant of 10% price preference to SC and ST contractors as per Resolution dated 11.10.1977. Therefore, even after declaration of the petitioner as 1st lowest bidder and compliance of all the formalities by him, the subsequent action of the State-opposite parties in cancelling the same, instead of executing the agreement with the petitioner, and selecting opposite party no.6 is violative of Articles 14, 19(1)(g) and 21 of the Constitution of India. It is further urged that the amended Codal provision of OPWD Manual, i.e., clause 3.5.10 having given effect to by the State-opposite parties by their own conduct, subsequently they cannot say that the same has not been given effect to and it is in a draft stage, which is absolutely misconceived one. It is also urged that if by conduct of parties, the revised OPWD manual has come into force, and on that basis, a conscious decision has been taken, parties are bound by the same and any deviation there from by the opposite partyauthorities is hit by principle of estoppel. Therefore, the work order should be issued in favour of the petitioner, as he was the L-1 bidder and complied with all the formalities or in the alternative direction be given for fresh tender with the change of terms and conditions of the tender call notice. 6. Mr. B.P. Pradhan, learned Addl. Government Advocate appearing for opposite party no.1 states that if the amended Codal provision, i.e., clause 3.5.10(a)(iii) of Draft Revised OPWD Manual available in the website of Works Department is only a draft and meant for inviting comments/suggestions in the matter for finalization, as is evident from letter dated 06.05.2016, in that case, the grant of concession to SC/ST contractors would be governed by the Works Department Resolution No.27748/W dated 11.10.1977. Applying the same to the present case, opposite party no.6, who belongs to SC category, is entitled to get the price preference of 10%. Therefore, the action taken by the authority in cancelling L-1 bid of the petitioner is wholly and fully justified. 7. Mr. P.K. Muduli, learned counsel for opposite parties no. Applying the same to the present case, opposite party no.6, who belongs to SC category, is entitled to get the price preference of 10%. Therefore, the action taken by the authority in cancelling L-1 bid of the petitioner is wholly and fully justified. 7. Mr. P.K. Muduli, learned counsel for opposite parties no. 2 to 5 though candidly admitted that the petitioner was the L-1 bidder and the State-opposite parties were going to execute the agreement, but taking into consideration the resolution dated 11.10.1977, where a price preference has been granted to the SC/ST contractors, the letter issued on 08.04.2016 in favour of the petitioner has been cancelled vide letter dated 24.05.2016 Annexure-6. The validity of resolution dated 11.10.1977 was challenged before this Court in W.P.(C) No. 607 of 2010, which has been upheld by the judgment dated 26.07.2011. So far as applicability of the amended Codal provision of OPWD code, i.e., Clause 3.5.10 (a) (iii) is concerned, it is stated that the same was in a draft stage. On clarification being sought vide letter dated 26.04.2016, the Government of Odisha, Works Department, which is the competent authority, communicated on 06.05.2016 that the Revised OPWD Manual available in the website of the Works Department is a draft proposal for revision of existing manual meant for inviting comments/suggestions in the matter for finalization and that grant of concession to SC/ST contractors is governed by the department resolution dated 11.10.1977. As per Clause-16 of the detailed tender call notice, it has been specifically mentioned that preference to SC/ST contractors has to be given. In view of that, invoking the resolution dated 11.10.1977 if opposite party no.6 has been selected, no illegality has been committed by the authority so as to warrant interference by this Court. It is urged that if the mistake has been committed by the authority, the same on being detected can be rectified. 8. Mr. A.K. Mohanty, learned counsel appearing for opposite party no.6 argued that the action of the authority is justified and he adopts the argument advanced by learned counsel for opposite parties no.1 and 2 to 5. 9. It is urged that if the mistake has been committed by the authority, the same on being detected can be rectified. 8. Mr. A.K. Mohanty, learned counsel appearing for opposite party no.6 argued that the action of the authority is justified and he adopts the argument advanced by learned counsel for opposite parties no.1 and 2 to 5. 9. There is no factual dispute to the extent that pursuant to a tender call notice dated 19.02.2016 issued by opposite party no.3, the petitioner along with others participated in the tender process and being found L-1 bidder was called upon to deposit initial security deposit and differential cost, which he complied on 18.03.2016. Consequentially, he was intimated on 08.04.2016 to execute the agreement on production of original documents within seven days. Even though he adhered to such conditions on 23.04.2016, he was communicated that the agreement would be executed after few days. When there was delay in execution of the agreement, the petitioner filed W.P.(C) No.9217 of 2016 seeking for direction to the State-opposite parties to issue work order in his favour. At that point of time, he was communicated vide letter dated 24.05.2016 cancelling his selection as L-1 bidder and selecting opposite party no.6 contractor belonging to S.C. category on the basis of the resolution dated 11.10.1977 giving price preference of 10%. 10. Opposite party no.6-contractor has been extended the benefit of price preference of 10% pursuant to resolution dated 11.10.1977. The amendment to the codal provision of OPWD code in Clause 3.5.10, which has been published in the website of the Government, is only available to the contractor belonging to the SC/ST community having ‘B’, ‘C’ and ‘D’ Class licence not to ‘A’ Class contractors to the extent of price preference at the rate of 5%. The opposite party no.6 being an ‘A’ Class contractor, this codal provision is not applicable. Further, the said amendment of the codal provision is at draft stage and having not been notified in the official gazette has not come into force. But relying upon this amended OPWD codal provision the benefit has been made applicable to similarly situated organization namely, ITDA, Jeypore which comes under the SC and ST development department, in view of the condition of Clause 5(viii) of the letter dated 17.01.2015. But relying upon this amended OPWD codal provision the benefit has been made applicable to similarly situated organization namely, ITDA, Jeypore which comes under the SC and ST development department, in view of the condition of Clause 5(viii) of the letter dated 17.01.2015. This building has been sponsored by the Central Government, as per the CPWD code price preference up to 5 % may be allowed in favour of individual SC and ST contractors as per the circular dated 02.03.2006 in Annexure-9 series. The Civil Engineering Department of Municipal Council vide its circular dated 15.04.2008 has extended the similar benefit. Consequentially, by conduct of parties if they have accepted the amended provision of OPWD code, they are estopped from changing their version by filing counter affidavit subsequently. Clause 16 of the present contract indicates that the contractor belonging to SC and ST category has to be given preferential treatment. On that basis, the benefit has been extended to opposite party no.6 in view of the resolution dated 11.10.1977. Therefore, selection of opposite party no.6 in consonance with Clause-16 of the DTCN and resolution dated 11.10.1997 cannot be said to be illegal. The mistake which has been committed in selecting the petitioner, which was subsequently detected, the same has been rectified by issuing the order of cancellation impugned before this Court. 11. A mistake which has been committed in the process of selection, the authority has got every right to rectify the same if it has been brought to their notice. The word “mistake” is generally used in the law of contracts to refer to an erroneous belief- ‘a belief that is not in accord with the facts.’ To avoid confusion, it should not be used, as it sometimes is in common speech, to refer to an improvident act, such as the making of a contract, that results from such an erroneous belief. Nor should it be used, as it sometimes is by Courts and Writers, to refer to what is more properly called a misunderstanding, a situation in which two parties attach different meaning to their language. Nor should it be used, as it sometimes is by Courts and Writers, to refer to what is more properly called a misunderstanding, a situation in which two parties attach different meaning to their language. An unconscious ignorance or forgetfulness of a fact, past or present, material to the contract, or a belief in the present existence of a thing material to the contract, which does not exist; some intentional act, omission, or error arising from ignorance, surprise, imposition, or misplaced confidence; in a legal sense, the doing of an act under an erroneous conviction, which act, but for such conviction, would not have been done. In Deva Metal Powders (P) Ltd. v. Commr. Of Trade Tax, U.P., (2008) 2 SCC 439 , ‘mistake’ means to take or understand wrongly or inaccurately; to make an error in interpreting it; it is an error, a fault, a misunderstanding, a misconception. If an unconscious, ignorance and forgetfulness of a facts has been taken into consideration and subsequently, it has been detected that a wrong has been committed, the authority has got right to rectify the same. In State of Punjab v. Jagdip Singh and Others, AIR 1964 SC 521 , the apex Court held as follows: “The respondents were officiating Tahasildar in the erstwhile State of Pepsu. By notification dated October 23, 1956 made by the Financial Commissioner of Pepsu they were confirmed as Tahasildars with immediate effect. No posts were, however, available at that time in which the respondents could be confirmed. The Supreme Court held that there being no vacancy in which the confirmation could take place, the order of the Financial Commissioner confirming the respondent as permanent Tahasildars must be held to be wholly void. No posts were, however, available at that time in which the respondents could be confirmed. The Supreme Court held that there being no vacancy in which the confirmation could take place, the order of the Financial Commissioner confirming the respondent as permanent Tahasildars must be held to be wholly void. It was further held that where a Government servant has no right to a post or to particular status, though an authority under the Government acting beyond its competence had purported to give that person a status which it was not entitled to give, he will not in law be deemed to have been validly appointed to the post or given the particular status.” In case of Sundar Lal and others v. State of Punjab, (1970) S.L.R. 59 a Full Bench of the Punjab and Haryana High Court held as follows “If owning to some bona fide mistake the Government has taken a decision regarding confirmation of an officer, it can certainly revise its decision at a subsequent stage, when the mistake comes to its notice.” In case of K.B. Sharma v. Transport Commissioner, U.P., AIR 1968 Allahabad, 276 the Court held as follows: “an order of confirmation, if passed under some mistake, could certainly be revised with a view to correct the mistake and that such a revision even if it might affect the person confirmed earlier, could by no means attract article 331 of the Constitution.” Similar view has also been taken by this Court in Sri Udayanath Jena v. State of Orissa represented by the Director of Health Services, Orissa and others, 1974(1) C.W.R. 587. In view of the law laid down by the apex Court as well as various High Courts it is no more res integra that the authority, who has committed a mistake, can rectify the same if it is brought to its notice at a subsequent stage. 12. So far as applicability of estoppel is concerned, in Union of India v. Rakesh Kumar and others, (2001) 4 SCC 309 the apex Court held no person can claim any right on the basis of the decision which is dehors the statutory rules nor can there be any estoppel. 13. In view of such position, the principle of estoppel will not apply to the present context, inasmuch as if the mistake has been discovered, the same is to be rectified. 13. In view of such position, the principle of estoppel will not apply to the present context, inasmuch as if the mistake has been discovered, the same is to be rectified. Accordingly, the action so taken by the authority when it has been discovered, the tender of opposite party no.6 has not been considered taking into account the price preference in view of the resolution dated 11.10.1977, they have rectified it. In that view of the matter, the action taken by the authority cannot said to be illegal. 14. The fact remains that the petitioner had been selected as L-1 and he had been called upon to deposit the ISD amount and he also complied the other provisions. He had then been intimated to execute the agreement, but subsequently the same was cancelled without following due procedure of law. Minimum compliance of principles of natural justice ought to have been made and in absence of the same, this Court is of the considered view that the entire action taken by the authority is hit by Article 14 of the Constitution. 15. In applying the principles of equity, while exercising the power under Article 226 of the Constitution of India, this Court considers it just and proper that the authority should, instead of settling the works in question in favour of opposite party no.6, go for a fresh tender in respect of the works in question by classifying the terms of the tender call notice and by affording due opportunity to all the parties. Accordingly, it is so directed. 16. In the result, both the writ petitions are allowed to the extent indicated above. No order as to cost.