Research › Search › Judgment

Madhya Pradesh High Court · body

2016 DIGILAW 778 (MP)

Holoflex Ltd. v. State of M. P.

2016-09-06

ALOK ARADHE, S.A.DHARMADHIKARI

body2016
ORDER : Alok Aradhe, J. 1. In these writ petitions, the petitioners which are the companies engaged in manufacture and supply of security holograms and authentication solutions, both in private and public sectors, have assailed the validity of the condition number 2 and number 4 in the Notice Inviting Tenders dated 8.6.2016. For the facility of reference, facts from Writ Petition No. 4448/2016 are being referred to. Factual Background : 2. Admittedly, between the years 2006 to 2014 the Madhya Pradesh Laghu Udyog Nigam Limited (hereinafter referred to as the ‘Nigam’) invited tenders for supply of security holograms to authorised bottlers in the years 2006, 2008, 2011 and 2014. The petitioner was awarded contract as it was the lowest bidder. Thus, admittedly the petitioner has supplied security holograms to the authorised bottlers in the State of Madhya Pradesh between the period from 2006 till date. It is also not in dispute that the petitioner has successfully supplied security holograms to the tune of 155 and 172 for the year 2014-2015 and 2015-2016. 3. The State Government with a view to ensure that spurious liquor is not sold in the State and to upgrade the technology for fixation of specification of hologram, constituted an internal committee on 25.4.2015, which was headed by Deputy Commissioner, Excise Indore. The Committee after deliberations with the departmental authorities, public representatives as well as taking into account the terms and conditions of the contract of other States opined that latest technology may be introduced with all checks and balances to ensure that there is no pilferage of public revenue. Thereafter, a pre-bid conference was held on 18.4.2016, which was attended by 13 bidders including the petitioners. The committee submitted its suggestions on 11.5.2016 which inter alia provide that supplier should establish a plant to manufacture the holograms in the State itself, who should function under supervision of Excise Department so as to ensure that it is near impossible to replicate the hologram and no copy can be made of it, which in turn will ensure that there is no pilferage of public revenue. It was also noted that the States of Tamil Nadu and Andhra Pradesh have adopted similar measures. 4. The Excise Commissioner after taking into account the report of the committee by communication dated 19.5.2016 apprised the State Government about the recommendations of the committee. It was also noted that the States of Tamil Nadu and Andhra Pradesh have adopted similar measures. 4. The Excise Commissioner after taking into account the report of the committee by communication dated 19.5.2016 apprised the State Government about the recommendations of the committee. The State Government by an order dated 20.5.2016 directed the Excise Commissioner to initiate tender process and formed a committee to issue tenders. The committee was constituted on 20.5.2016 itself, comprising Additional Excise Commissioner, State Level Flying Squad, Managing Director of Madhya Pradesh Laghu Udyog Nigam Limited or his nominee, Deputy Commissioner Excise Indore, Joint Director Finance, and Assistant Excise Commissioner, Divisional Flying Squad, Bhopal, which made deliberations and finally with the assistance of earlier committee final draft was prepared. The State Government by an order dated 4.6.2016 directed to opt for e-tendering of the contract in question. Thereafter, the Notice Inviting Tender dated 8.6.2016 was issued, by which tenders in the two bid system, namely, Technical and Price bid, were invited from reputed hologram manufacturers for production and supply of security holograms in spool form for application on liquor bottles. The approximate quantity of security holograms was 175 crores in a year and last date of submission of tender was 2.7.2016 and the technical bid was to be opened on 5.7.2016. The period of contract is 5 years, i.e., 2016 till 2021. The aforesaid notice inviting tenders contains conditions number 2 and 4, which has been impugned in this bunch of writ petitions. The impugned condition number 2 of the Notice Inviting Tender pertains to requirement of annual turn over of not less than Rs. 40 Crores for the preceding three years whereas impugned condition number 2 deals with net worth and provides that tenderer should have minimum net worth of Rs. 30 Crores as on 31.3.2015. 5. Being aggrieved by the aforesaid conditions in the Notice Inviting Tender, the petitioner submitted a representation to the Excise Commissioner on 15.6.2016. However, the same was rejected by the Excise Commissioner on 24.6.2016 inter alia on the ground that requirement of turnover is as per Central Vigilance Commission Guidelines and the introduction of net worth requirement is necessary to ensure that bidder has sufficient financial reserves to set a factory immediately, the cost of which may run into crores. In the aforesaid factual background, the petitioners have approached this Court. 6. In the aforesaid factual background, the petitioners have approached this Court. 6. The petitioner in Writ Petition No.4448/2016 approached this Court on 28.6.2016 whereas Writ Petition No.4594/2016, Writ Petition No.4664/2016 and Writ Petition No.5071/2016 were filed respectively on 1.7.2016, 4.7.2016 and 17.7.2016. On 22.7.2016 the petitioner in Writ Petition No.4448/2016 moved an application seeking amendment by impleading respondents No.3 and 4 and averments with regard to alleged formation of cartel-ship, favouritism and malice in law were incorporated. The aforesaid application was allowed on 26.7.2016 and on 27.7.2016 final arguments in the case were heard. However, at the time of hearing learned senior counsel for the respondent No.3 and counsel for the respondent No.4 made their submissions without filing any reply in the matter. An application, namely, I.A.No.5117/2016 filed by the petitioner in Writ Petition No.4448/2016 for taking additional facts on record, was also allowed. Thereafter on 29.7.2016 this Court passed an order directing the respondents No.3 and 4 to file reply to ensure fair and complete adjudication of the controversy involved in the writ petition, pursuant to which respondents No.3 and 4 had filed their returns and the petitioner in Writ Petition No.4448/2016 has filed a rejoinder. Thereafter on 26.8.2016 and 30.8.2016 the arguments were heard. Contentions : 7. Learned senior counsel for the petitioner in Writ Petition No. 4448/2016 submitted that the committee constituted by the State Government recommended that a tenderer must have experience in manufacture as well as supply of holograms. However the aforesaid condition was deliberately omitted in the Notice Inviting Tender and the impugned conditions are tailor-made conditions incorporated in the notice inviting tenders to suit respondents No.3 and 4. While referring to condition number 2 of the impugned Notice Inviting Tenders, it is pointed out that annual turn over of Rs. 40 Crores mentioned in the aforesaid condition has no reference to manufacture and supply of holograms and, therefore, any person who may not have any experience of manufacture and supply of holograms, is also eligible to participate in the tender. It is also submitted that the criteria with regard to annual turn over in other States is very small and there is no requirement of net worth. It is also argued that with a view to extend favour to big manufacturers and suppliers the requirement of turnover has been increased 10 fold and is quantified at Rs. It is also submitted that the criteria with regard to annual turn over in other States is very small and there is no requirement of net worth. It is also argued that with a view to extend favour to big manufacturers and suppliers the requirement of turnover has been increased 10 fold and is quantified at Rs. 40 Crores whereas new condition of having Net worth of Rs. 30 Crores has been introduced. It is further argued that hologram industry in India comprises largely small enterprises and required turnover of Rs. 40 Crores will not be met by most of the manufacturers. It is also pointed out that even though the petitioner had low turnover, yet it has been satisfactorily supplying security holograms to the extent of Rs. 129.95 Crores to 180 Crores between the years 2012-2013 to 2015-2016. 8. It is also contended that justification for condition of insertion of Net worth of Rs. 40 Crores on the ground that new factory is required to be set up in the State of Madhya Pradesh is not justified as it is possible to set up new hologram unit with an expenditure of Rs. 5 Crores. It is also argued that incorporation of impugned conditions in the Notice Inviting Tender is against public policy and public interest and defeats the object of creating a level playing field. It is further submitted that respondents No.3 and 4 have common factory address, namely, 29-B, Malanpur Industrial Area, District Bhind and have formed a cartel to cause huge loss of revenue to the State. In this connection, our attention has been invited to the latest Annual Reports and the balance sheet to point out that the respondent No.4 is the largest shareholding company which constitutes 3.05% of equity capital of respondent No.3. From the balance sheet of respondent No.3, it is pointed out that the respondent No.3 has advanced a loan of Rs. 30 Crores to respondent No.4 and respondents No.3 and 4 are sister concerns having common interest and common factory premises. It is also pointed out that on 31.3.2013 the respondent No.4 has invested in as many as 7 companies which are all in the promoters group of respondent No.3 and, therefore, the respondents No.3 and 4 are one and the same entity. It is also pointed out that on 31.3.2013 the respondent No.4 has invested in as many as 7 companies which are all in the promoters group of respondent No.3 and, therefore, the respondents No.3 and 4 are one and the same entity. It is also pointed out that respondent No.4 in its bid has enclosed documents of its plant and machinery provided by respondent No.3. It is also pointed out that the respondent No.5, which does not have a Net worth of more than Rs. 2.00 Crores, has submitted its bid at the instance of respondent No.3 so as to make the tender process in question look competitive. 9. It is urged that respondent No.3 has admitted that it has leased out the land and building to respondent No.4, on yearly short term lease and though it is alleged that the same was later on purchased by respondent No.4 in the year 2012, yet no sale deed has been placed on record. It is further urged that even though respondent No.3 is not a non-banking financial institution yet it advanced an unsecured loan to the tune of Rs. 30 Crores to respondent No.4. It is further urged that from inter se transactions between respondents No.3 and 4, it is evident that the interests of respondents No.3 and 4 are common and there cannot be any competition between respondents No.3 and 4. Learned senior counsel for the petitioner submits that he be permitted to withdraw the statement made in paragraph 9 of the rejoinder containing the pleading that independent Director of the respondent No.3, Mr. M.G. Gupta, is the father of the main promoter of respondent No.4. It is submitted that the aforesaid pleading was based on general information available on the website/annual report and in view of the similarity in the name of father of the petitioner and respondent No.4 and the independent Director of respondent No.3, and the aforesaid averment was made inadvertently. He has tendered his sincere apologies for the mistake which has crept in the pleadings through inadvertence. Lastly, it is urged that the respondents No.3 to 5 had participated in the tender process in the State of Uttar Pradesh and had formed a cartel, pursuant to which a complaint was lodged against them which is being investigated by a Retired Judge of High Court of Allahabad. Lastly, it is urged that the respondents No.3 to 5 had participated in the tender process in the State of Uttar Pradesh and had formed a cartel, pursuant to which a complaint was lodged against them which is being investigated by a Retired Judge of High Court of Allahabad. In support of the aforesaid submissions, learned senior counsel for the petitioner in Writ Petition No.4448/2016 has placed reliance on the decisions in the cases of Union of India and others v. Dinesh Engineering Corporation and others, (2001) 8 SCC 491 ; Jespar I. Slong v. State of Meghalaya and others, (2004) 11) SCC 485; Reliance Energy Ltd. and another v. Maharashtra State Road Development Corpn. Ltd. and others, (2007) 8 SCC 1 ; B.S.N. Joshi and Sons Limited v. Ajoy Mehta and another, (2009) 3 SCC 458 ; and, Meerut Development Authority v. Association of Management Studies and another, (2009) 6 SCC 171 ; Rishikaran Logistics Pvt. Ltd. v. Board of Trustees, (2015) 13 SCC 233 ; Maa Binda Express Carrier v. North-East Frontier Railway, (2014) 3 SCC 760 ; Michigan Rubber (India) Ltd. v. State of Karnataka, (2012) 8 SCC 216 ; Sharad Oswal v. M.P. Poorva Kshetra Vidyut Vitran Company Ltd., I.L.R. (2008) M.P. 226; L.M.P. Precision Engineering Co. Pvt. Ltd. v. Union of India, I.L.R. (2011) M.P. 2347. 10. Learned senior counsel for the petitioner in Writ Petition No.4594/2016 has submitted that turnover has been increased 8 times to eliminate competition, even though the requirement of holograms has been increased only 1.2 times, i.e., from Rs. 150 Crores to Rs. 180 Crores. It is also argued that requirement of turnover is not confined to hologram business and the aforesaid requirement is violative of Central Vigilance Commission Guidelines. It is further submitted that the requirement of Net worth of Rs. 30 Crores has no rational relation with the object of securing best quality holograms at competitive price. It is also submitted that the respondents No.3,4 and 5 have formed a cartel. Our attention has also been invited to pre-qualifying bid conditions laid down by other States as well. It is further submitted that the requirement of Net worth of Rs. 30 Crores has no rational relation with the object of securing best quality holograms at competitive price. It is also submitted that the respondents No.3,4 and 5 have formed a cartel. Our attention has also been invited to pre-qualifying bid conditions laid down by other States as well. In support of aforesaid submissions, learned senior counsel has placed reliance on the decisions in the cases of Ramana Dayaram Shetty v. International Airport Authority of India, AIR 1979 SC 1628 ; Laxminarayan Deohare v. Union of India, AIR 2000 MP 175 ; M/s Pratibha R.C.C. Spun, Pipe and Cements v. State of Karnataka, AIR 1991 Karnataka 205; and, Jai Bharat Transport Company v. Central Coal Fields Limited, AIR 1989 Patna 170. 11. Learned senior counsel for the petitioner in Writ Petition No.4664/2016 as well as learned counsel for the petitioner in Writ Petition No.5071/2016 have adopted the submissions made by learned senior counsel for the petitioner in Writ Petitions No.4448/2016 and 4594/2016. 12. On the other hand, learned Advocate General for the respondents No.1 to 3 submitted that quantity of holograms for the year 2015-2016, which was required to be supplied was 172.88 Crores, having turnover of Rs. 41.02 Crores. The contract in question is for five years, i.e., from 2016 to 2021. It is further submitted that after due deliberations by the committees, new conditions have been incorporated, namely, establishment of plant and machinery in Madhya Pradesh, installation of latest technology and equipments and the tenderer is required to work under the supervision of the excise department. Therefore, the impugned conditions have been incorporated in the NIT in public interest to ensure that spurious liquor is not supplied and even the remote possibility of misbranding/mislabelling is eliminated. Our attention has also been invited to Interlocutory Application No.3950/2016 and it is pointed out that the Flying Squad has registered a case on 30.5.2016, pursuant to which an enquiry was made and it was found that the petitioner in Writ Petition No.4448/2016 is supplying parallel series of holograms illegally to bottlers which is resulting in loss of public revenue. Our attention has also been invited to Interlocutory Application No.3950/2016 and it is pointed out that the Flying Squad has registered a case on 30.5.2016, pursuant to which an enquiry was made and it was found that the petitioner in Writ Petition No.4448/2016 is supplying parallel series of holograms illegally to bottlers which is resulting in loss of public revenue. It is also urged that pleadings made by the petitioner do not satisfy the requirements of malice in law and the writ petition is premature as the technical bids are yet to be finalised by the competent committee which will be followed by opening of the financial bid. 13. It is also urged that an element of public exchequer is involved in the contract in question and if duplicate holograms are affixed on the liquor bottles then it would amount to direct loss to the public exchequer. The impugned conditions have been incorporated, being the safety measure and by no stretch of imagination the same can be said to be irrational or arbitrary. It is also submitted that the guidelines issued by Central Vigilance Commission are directory in nature and the authority issuing the tender can formulate the terms and conditions inviting tender. It is further submitted that, in fact the committees constituted by the State Government had recommended annual turnover of Rs. 50 Crores which is reduced to Rs. 40 Crores. It is also submitted that since the supplier is required to set up a factory in the State of Madhya Pradesh, therefore, the requirement of Net worth has been prescribed to ensure safety of public in large and to avoid sale of spurious liquor as well as to ensure that there is no pilferage of public revenue. It is also argued that a supplier would be required to spend a sum of Rs. 15 to 20 Crores for installation of the factory which has to function under the supervision of Excise Department. It is further submitted that the recommendations of the committee have been approved by the State Government on 20.5.2016. Learned Advocate General has also produced the relevant record for our perusal. 14. It is urged that the conditions impugned in the instant writ petitions are reasonable and the scope of judicial review is extremely limited with regard to interference with the conditions contained in the Notice Inviting Tender. Learned Advocate General has also produced the relevant record for our perusal. 14. It is urged that the conditions impugned in the instant writ petitions are reasonable and the scope of judicial review is extremely limited with regard to interference with the conditions contained in the Notice Inviting Tender. It is also urged that purpose of incorporation of the impugned conditions is with a view to ensure that by use of latest technology holograms are made more visible with utmost clarity and are highly secured, which is the prime obligation of the State. It is also urged that enhancement of turnover as well as Net worth are essential for the State so that healthy competition is generated and genuine companies participate in the tender and if the contract is awarded to a successful tenderer, the performance should not be affected on account of poor turnover and net worth. The requirement of net worth has been inserted to assess financial credibility of the company and setting up of the factory will involve substantial investment and three months of rolling capital will also be required, which would be to the tune of Rs. 12-13 Crores. Therefore, the financial worthiness of a tenderer plays an important role. 15. It is also pointed out that clause 43 of the Notice Inviting Tender provides appropriate forum for redressal of the grievance and, therefore, the writ petition at this stage is premature. It is argued that hologram business is worth Rs. 250 Crores and cannot be handled by small scale industry. It is further argued that the respondents No.3 and 4 are separate legal entities and have independent Board of Directors. It is also argued that the petitioner had supplied 172.88 Crores holograms having turnover of Rs. 42.01 Crores. Therefore, the requirement of net worth is reasonable condition as the petitioner has expressed his willingness to set up the factory in Madhya Pradesh. It is also pointed out that rest of the petitioners except the petitioner in Writ Petition No.4448/2016 have not approached this Court in quite promptitude. It is further submitted that there is no pleading in the writ petition that in the previous Notice Inviting Tenders, which were issued by Nigam, the condition of manufacture and supply was there and the condition with regard to supply has been deliberately omitted despite recommendation made by the committee. It is further submitted that there is no pleading in the writ petition that in the previous Notice Inviting Tenders, which were issued by Nigam, the condition of manufacture and supply was there and the condition with regard to supply has been deliberately omitted despite recommendation made by the committee. It is also submitted that clauses 37 and 43 of the Notice Inviting Tender is complete answer to the issue of cartelisation raised by the petitioner. It is also submitted that though the technical bid has been opened, yet the same has to be finalised, as the samples has been made over to Indian Institute of Packaging, Delhi,which is a Government of India Undertaking. Lastly, it is urged that in case any of the petitioners has any grievance with regard to process of tender, the petitioners would be at liberty to approach the Excise Commissioner, who shall deal with the complaint with utmost objectivity. In support of aforesaid submissions, learned Advocate General has placed reliance on the decisions in the cases of Tata Cellular v. Union of India, (1994) 6 SCC 651 ; Air India Limited v. Cochin International Airport Limited, (2000) 2 SCC 617 ; Directorate of Education v. Educomp Datamatics Limited, (2004) 4 SCC 19 ; Association of Registration Plates v. Union of India, (2005) 1 SCC 679 ; Global Energy Limited v. Adani Exports Limited, (2005) 4 SCC 435 ; Michigan Rubber (India) Limited v. State of Karnataka, (2012) 8 SCC 216 ; Welcome Distillery Pvt. Ltd. v. State of Madhya Pradesh and others, 2016 (2) MPHT 123; Writ Petition No.1521/2015 (Rajeev Kumar Sharma v. State of MP); Writ Petition No.4501/2016 (Bansal Construction Co. Pvt. Ltd. v. M.P.R.D.C.). 16. Learned senior counsel for the respondent No.3 has submitted that the petitioner in Writ Petition No.4448/2016 had submitted the representation dated 12.6.2016 with regard to the impugned tender conditions, however, no allegation was made in the representation with regard to the co-relation between respondents No.3 and 4. Thus, the allegations made against the respondents No.3 and 4 are nothing but an after thought. Thus, the allegations made against the respondents No.3 and 4 are nothing but an after thought. It is further submitted that the respondents No.3 and 4 are separate legal entities and apart from respondent No.4, 11 shareholders have collective share holdings to the tune of 21.05 % whereas the respondent No.4 is holding only 3.05% shares and, therefore, the respondent No.3 can neither be termed as associate company nor subsidiary company, as it holds less than 20% and 50% shares respectively. It is further submitted that inter business transactions are permissible under Section 186 of the Companies Act, 2013 (hereinafter, referred to as the ‘Act’). A loan of Rs. 30 Crores was given on 30.9.2015 to respondent No.4, which was refunded by the respondent No.4 on 6.10.2015. It is argued that such advancement of loan or inter-corporate deposit between two corporate bodies is normal business transaction, in the course of business. It is also pointed out that the respondent No.3 had initially given its factory, plant and machinery, building and land at 29-A and 29-B, Malanpur Industrial Area, Bhind on licence from 2002 till 2011 to respondent No.4 and thereafter the entire plant and machinery installed at 29-A and 29-B has been sold out in 2012 and the land and building is still in the name of respondent No.3, as the same cannot be sold due to pending permissions of various financial institutions and respondent No.3 has ceased manufacturing activities from the premises. Therefore, the address of 29-A and 29-B at Malanpur factory in the column of ‘works’ is shown as owner of land and building. It is further pointed out that respondent no.3 has its factory at Noida. 17. It is further argued that the companies in the field of hologram business are inter-dependent for material and machinery and respondent No.3 at several points of time has business dealings with respondent No.4 along with other customers and the aforesaid transactions are business transactions and, therefore, the documents of respondent No.3 were enclosed with the tender document, and it cannot be concluded that the respondents No.3 and 4 are sister concerns. It is submitted that the amount was paid to respondent No.5 under consultancy agreement which is evident from the document, Annexure R-3(4) and the same does not establish any relation between respondents No.3 and 5. It is submitted that the amount was paid to respondent No.5 under consultancy agreement which is evident from the document, Annexure R-3(4) and the same does not establish any relation between respondents No.3 and 5. It is also submitted that when the financial bids are opened then only the question of cartelisation can be gone into. It is also submitted that Board of Directors of respondent No.3 is different and its factory is situate at Noida. It is also pointed out that similar transactions have taken place with one of the writ petitioners and, therefore, no adverse inference can be drawn. It is also urged that before opening of the financial bid it is also not possible to guess the rates quoted by the respondents No.3 and 4 and the respondents No.3 and 4 have quoted their rates as per their own wisdom, therefore, the allegation of cartelization made by the petitioner is wholly baseless. It is also pointed out that the enquiry initiated by the Government of Uttar Pradesh on the complaint filed by one Satyaprakash Mishra is still pending and no irregularity has been found so far. It is also pointed out that the complainant, namely, Vinay Mishra happens to be the Secretary of Shramik Kalyan Samiti, who is in the habit of filing false and bogus complaints. It is also submitted that aforesaid Vinay Mishra had filed a Public Interest Litigation, namely, Writ Petition No. 58597/2012 before the High Court of Allahabad on the issue of tender in respect of holograms. However, the writ petition was withdrawn by him on 15.3.2014. It is pointed out that respondent No.3 has experience of manufacture of holograms and the requisite documents have been annexed with the tender document. In support of aforesaid submissions, reliance has been placed on decisions of the Supreme Court in the case of Jagdish Mandal v. State of Orissa, (2007) 14 SCC 517; Centre for Public Interest Litigation v. Union of India and others, (2016) 6 SCC 408 ; and, M/s. Wave Industries Private Limited, Amroha (Uttar Pradesh) v. State of Jharkhand & others, AIR 2016 Jharkhand 88. 18. Learned counsel for the respondent No.4 while supporting the submissions made by learned senior counsel for the respondent No.3 submitted that the writ petition filed by the petitioner is based on presumptions and assumptions. 18. Learned counsel for the respondent No.4 while supporting the submissions made by learned senior counsel for the respondent No.3 submitted that the writ petition filed by the petitioner is based on presumptions and assumptions. It is further submitted that on account of incorrect statement made in paragraph 9 of the rejoinder, the respondent No.4 has filed an application under Section 340 of the Code of Criminal Procedure and, therefore, appropriate action be taken against the petitioner in Writ Petition No.4448/2016. It is further submitted that the respondent No.4 is a separate legal entity and has a separate Board of Directors. Learned counsel for the respondent No.4 also submitted that the respondent No.4 has experience of manufacture of holograms and requisite documents in this regard have been annexed with the tender form. 19. By way of rejoinder reply learned senior counsel for the petitioner has submitted that requirement of supply and experience in the impugned notice inviting tenders has been diluted to favour the respondents No.3 and 4 and to create monopoly in favour of major players in the field. It is also argued that the respondents No.3 and 4 have no experience of manufacturing the holograms. It is also pointed out that a fake report has been prepared by the Deputy Commissioner during the pendency of the writ petition with regard to supply of fake holograms by the petitioner. It is also pointed out that assets of respondents No.3 and 4 are less and liabilities are more. It is also argued that the action of the respondent No.3 is actuated by malice in law. In support of aforesaid submissions, reference has been made to decisions of Supreme Court in the cases of Ravi Yashwant Bhoir v. District Collector, Raigad and others, (2012) 4 SCC 407 , and Asha v. Pt.B.D. Sharma University of Health Sciences and others, (2012) 7 SCC 389 . The Scope of Judicial Review : 20. We have considered the submissions made by learned counsel for the parties and have perused the record. It is well settled in law that discretion to grant largesse including award of jobs, contracts, quotas, license and so on must be structured by rational, relevant and non-discretionary standard or norms. The Scope of Judicial Review : 20. We have considered the submissions made by learned counsel for the parties and have perused the record. It is well settled in law that discretion to grant largesse including award of jobs, contracts, quotas, license and so on must be structured by rational, relevant and non-discretionary standard or norms. If the Government departs from such standard or norms, its action would be liable to be struck down unless the Government can establish that departure was not arbitrary, but was based on some valid principles which in itself was not irrational, irrelevant, unreasonable or discriminatory. See, Narendra Kumar Maheshwari v. Union of India, 1990 (Supp) SCC 440. It is equally well settled legal proposition that it is open to the State to prescribe conditions in the tender, prescribing the eligibility criteria and if the State can justify the tender conditions in the context of particular contract, the courts will not interfere and whenever there are different alternatives, it is not for the courts to suggest that a particular alternative is justified. In awarding contract, the public interest is of paramount consideration and there should be no arbitrariness in awarding the contract and all participants in the tender process must be treated alike. In the celebrated case of Tata Cellular (supra), the Supreme Court while dealing with the scope of judicial power of review held that it would apply to exercise of contractual powers by Government bodies in order to prevent arbitrariness or favouritism. It has been held that the ground upon which the administrative action is subject to control by judicial review is on the grounds of illegality, irrationality and procedural impropriety. It has further been held that terms of the invitation to tender are not open to judicial scrutiny because invitation to tender is in the realm of contract and more often than not, such decisions are made qualitatively by experts. It has further been held that 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 but must be free from arbitrariness not affected by bias or actuated by mala fides. 21. 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 but must be free from arbitrariness not affected by bias or actuated by mala fides. 21. The principles regarding award of contract were again reiterated by the Supreme Court in the case of Director of Education (supra) and it was held that Government must have a free hand in setting the terms of tender and the courts cannot strike down the terms of tender prescribed by the Government because it feels that some other terms in the tender would have been fairer, wiser or more logical. The courts can interfere only if the policy decision is arbitrary, discriminatory or actuated by malice. In the case of Shimnit Utsch India Private Limited v. West Bengal Transport Infrastructure Development Corporation Limited, (2010) 6 SCC 303 , the Supreme Court while taking note of the law laid down in Assn. of Registration Plates (supra), reiterated that State Government has the right to get the right and most competent person and in the matter of formulating conditions of tender documents, unless the action of tendering authority is found to be malicious and is a misuse of statutory powers, the tender conditions are unassailable. In the case of Siemens Aktiengeselischaft and Seimens Limited v. Delhi Metro Rail Corporation Limited and others, (2014) 11 SCC 288 , it was held that tenders floated by the Government are amenable to judicial review only in order to prevent arbitrariness and favouritism and protect the financial interest of the State and the public interest. Thus, the scope of judicial review is confined as to whether there was any illegality, irrationality or procedural impropriety committed by the decision making authority. It has further been held that the court cannot sit in appeal over the soundness of the decision made by the competent authority and the court can only examine whether the decision making process was fair, reasonable, transparent and bona fide with no perceptible injury to public interest. It has further been held that the court cannot sit in appeal over the soundness of the decision made by the competent authority and the court can only examine whether the decision making process was fair, reasonable, transparent and bona fide with no perceptible injury to public interest. From the various decisions cited on both sides, following legal principles are deducible :- (i) The procedure adopted by ‘State’ under Article 12 while awarding contract can be adjudged and tested on the touchstone of Article 14 of the Constitution of India. (ii) The Government cannot act in a manner which would benefit a private party at the expense of the State as the same would be unreasonable and contrary to public interest. (iii) While exercising power of judicial review the court will not examine the details of contract but only are concerned with decision making process and whether the same was reasonable, rational and arbitrary or is violative of Article 14 of the Constitution of India. (iv) The State while inviting tenders cannot take into account the factors which are irrelevant and detrimental to public interest. (v) An administrative action is subject to control by judicial review on the grounds of illegality, irrationality and procedural impropriety. (vi) The power of judicial review is available in cases where it is established that terms of invitation to tender are tailor-made to suit the convenience of any particular person with a view to eliminate all others from participating in the bidding process, unless the tender conditions are wholly arbitrary, discriminatory or actuated by malice, the terms of tender notice are not subject to judicial review. (vii) Level Playing Field is an important concept while construing Article 19(1)(g) of the Constitution of India, which confers fundamental right to carry on business. However, the aforesaid doctrine is subject to public interest. (viii) The power of judicial review is also available in a case where the action of the respondent is not only arbitrary, unreasonable and curtails public participation which vitally affects public interest and if permitted would result in causing loss to public exchequer for want of adequate competition. The Court would intervene if tender conditions give rise to formation of cartel which is against public policy. The Court would intervene if tender conditions give rise to formation of cartel which is against public policy. (ix) The Government while entering into contract or issuing quotas is expected not to like a private individual but should act in conformity with certain healthy standards and norms which are not arbitrary, irrational or irrelevant. (x) The terms of invitation to tender are not subject to judicial scrutiny and more often than not such decisions are made by experts and it is not open for the courts, whenever there are different alternatives, to suggest that particular alternative is more justified. Greater latitude is to be conceded to State authorities in the matter of formulating conditions of tender and awarding contracts. (xi) The Government has freedom of contract and court cannot strike down terms of tender merely because it feels that some other conditions in the tender would has been fairer, wiser or more logical. The courts can interfere only when conditions of tender are arbitrary, discriminatory and actuated by malice. (xii) The award of contract, whether it is by a private party or a public body or the State, is essentially a commercial transaction. The State can chose its own method to arrive at its decision and can fix its own terms of invitation of tender and that is not open to judicial scrutiny. Even when some defect is found in decision making process, the court must exercise its discretionary power under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely of making out a legal point. (xiii) No person can claim a fundamental right to carry on business with the Government. All that he can claim is that, in competing for the contract, he should not be unfairly treated and discriminated to the detriment of public interest. (xiv)The Government is the guardian of State finances and is expected to protect it. The right to choose cannot be considered as arbitrary as long as it complies with requirement of principles of Article 14 of the Constitution of India. (xv) The test to be adopted is whether something has gone wrong of a nature and degree which requires court’s intervention. See, R. v. Secy. of State for Home Deptt. Ex P. Brind, (1991) 1 All ER 720 (HL). 22. (xv) The test to be adopted is whether something has gone wrong of a nature and degree which requires court’s intervention. See, R. v. Secy. of State for Home Deptt. Ex P. Brind, (1991) 1 All ER 720 (HL). 22. The Supreme Court in the case of Union of India v. Hindustan Development Corporation and others, (1993) 3 SCC 499, while dealing with the expression ‘cartel’ in the context of contract has held that the cartel is an association of producers who by agreement among themselves attempt to control production, sale and prices of the product to obtain a monopoly in any particular industry or commodity. Analysing the object of formation of a cartel, in other words, it amounts to an unfair trade practice which is not in the public interest. However, mere offering of a lower price by itself, though appears to be predatory, cannot be a factor for inferring formation of a cartel unless an agreement amounting to conspiracy is also proved. A mere offer of a lower price by itself does not manifest the requisite intent to gain monopoly and in the absence of a specific agreement by way of a concerted action suggesting conspiracy, the formation of a cartel among the producers who offered such lower price cannot readily be inferred. Similar view was taken by the Supreme Court in the case of B.S.N. Joshi & Sons Limited (supra). The Issues: 23. In the backdrop of aforesaid well settled legal principles, the issues which emerge for our consideration are, namely, (i) whether the impugned tender conditions are irrational, arbitrary, violative of Article 14 and are tailor-made to suit the respondents No.3 and 4; (ii) whether impugned tender conditions are against the object of creating a level playing field and contrary to public policy and public interest; (iii) whether the conditions contained in impugned Notice Inviting Tender are contrary to the guidelines issued by Central Vigilance Commission; (iv) whether insertion of impugned tender conditions leads to formation of cartel, which is against public policy; (v) whether respondents No.3 and 4 are separate legal entities. We shall now proceed to deal with the issues ad seriatum. Analysis : 24. Before proceeding further, we deem it appropriate to reproduce the impugned tender conditions for the facility of reference:- “TURNOVER - 2. The tenderer should have an annual turnover of not less than Rs. We shall now proceed to deal with the issues ad seriatum. Analysis : 24. Before proceeding further, we deem it appropriate to reproduce the impugned tender conditions for the facility of reference:- “TURNOVER - 2. The tenderer should have an annual turnover of not less than Rs. 40 Crores for the preceding 3 years. As the audited annual Report for the years 2012-13, 2013-14 and 2014-15 should be attached. NET WORTH - 4. The tenderer should have minimum Net worth of Rs. 30 Crores as on 31.3.2015. The audited annual Report for the year 2014-15 should be attached. Explanation - For the purpose of this clause Net worth means as defined in Companies Act, 1956.” 25. The condition number 2 provides that tenderer should have annual turn over of not less than Rs. 40 Crores for preceding three years, whereas condition number 4 prescribes net worth of Rs. 30 Crores. Admittedly, prior to issuance of impugned Notice Inviting Tender, Nigam was issuing Notice Inviting Tender. A comparative year wise chart of tenders issued from 2005-2006 by the Nigam and the impugned Notice Inviting Tender with relevant clauses is reproduced below:- TERMS AND CONDITIONS OF HOLOGRAM TENDER (COMPARISON YEAR WISE) 2005-06 2008-10 2010-12 2014-16 2016-21 The tenderer must have at least six months of experience facility to prepare Dot matrix, 2D/3D combine master. The tenderer must have capability of design and construction of the master in house of 2500DPI or more with experience of minimum six months for the above purpose, i.e., facility to prepare Dot matrix, 2D/3D combine master. The tenderer must have at least 4 years of experience in shooting of both Dot matrix 6000DPI and conventional 2D/3D master recombine together in house. The tenderer must have at least 4 years of experience in shooting of both Dot matrix 6000DPI and conventional 2D/3D master recombine together in house. The tenderer should have High Security Master at resolution of at least 12000DPI or more by using either single or multiple master origination systems. The tenderer must have 2 years experience of manufacturing in supply of Security Holograms. The tenderer must have 2 years experience of manufacturing in supply of Security Holograms. The tenderer must have 4 years experience of manufacturing in supply of Polyester based Security Holograms. The tenderer must have 4 years experience of manufacturing in supply of Polyester based Security Holograms. The tenderer must have 2 years experience of manufacturing in supply of Security Holograms. The tenderer must have 2 years experience of manufacturing in supply of Security Holograms. The tenderer must have 4 years experience of manufacturing in supply of Polyester based Security Holograms. The tenderer must have 4 years experience of manufacturing in supply of Polyester based Security Holograms. The tenderer should have at least 5 years of experience in the field of manufacturing of security holograms or mastering lab. The tenderer must have turnover of at least Rs. 2 Crores in the business of holograms in financial years 2004-05. The tenderer must have turnover of at least Rs. 2 Crores in the business of holograms in each financial years 2005-06 and 2006-07. The tenderer should have supplied polyester based security holograms to at least one State Excise Department in India The tenderer must have turnover of at least Rs. 5 Crores in manufacture and supply of Polyester based security holograms per year in the financial year 2011-12 and 2012-13. The tenderer should have an annual turnover of not less than Rs. 40 Crores for preceding 3 years 2012-13, 2013-14 and 2014-15. The tenderer should have supplied at least 30 Crores Polyester based Security holograms to single customer in preceding financial year i.e., 2009-10. The tenderer should have supplied at least 30 Crores Polyester based Security holograms to single customer in preceding financial year i.e., 2012-13. The tenderer should have minimum Net Worth of Rs. 30 Crores as on 31.03.2015. 26. Thus, it is evident that in the tender issued in the year 2014 by the Nigam, which was for a period of two years, requirement of turn over is enhanced from Rs. 2 Crores to Rs. 5 Crores, which has now been enhanced to Rs. 40 Crores in the contract, which is for a period of five years. The Madhya Pradesh Distilleries Association submitted representation on 6.4.2015 to the Minister, Commercial Tax Department that the rate on which hologram is being supplied to them by the petitioner in Writ Petition No.4448/2016 is excessive. 5 Crores, which has now been enhanced to Rs. 40 Crores in the contract, which is for a period of five years. The Madhya Pradesh Distilleries Association submitted representation on 6.4.2015 to the Minister, Commercial Tax Department that the rate on which hologram is being supplied to them by the petitioner in Writ Petition No.4448/2016 is excessive. Thereupon, the Commissioner Excise by an order dated 25.4.2015 constituted a committee consisting of Deputy Commissioner Excise, Indore, Divisional Assistant Excise Commissioner, Flying Squad Bhopal and Assistant Commissioner Excise posted in Headquarter to recommend specification of hologram, so as to ensure that hologram can be supplied at a lesser rate and sale of spurious liquor can be prevented. The aforesaid committee held meeting on 6.6.2015 in which 15 Excise Officers posted in various places were present and representatives of Distilleries were also present and their suggestions were also invited. After due deliberations, it was resolved to specify the size of hologram and it was recommended that the number of hologram should be mentioned vertically in the hologram. Thereafter, on 19.6.2015, the committee submitted its recommendations, namely-(i) adoption of latest technique for manufacture of hologram, containing general and special features so as to ensure that it is near impossible to replicate the hologram and no copy can be made; (ii) manufacture of hologram should be made under the control and supervision of the Excise Department; (iii) another committee should be constituted to ascertain technical specifications consisting of Additional Excise Commissioner and Deputy Commissioner Excise; (iv) in the committee which may be constituted for selection of tenderer, Joint Director Finance and a representative of the Nigam should also be included. 27. Thereafter, on 16.3.2016 the Excise Commissioner directed to finalise the specification of hologram and to hold pre-bid meeting. Thereafter a pre-bid conference was held on 18.4.2016 which was attended by 13 hologram manufacturers including the petitioners. After due deliberations, it was resolved to prescribe polyester based hologram so as to ensure that it is near impossible to replicate the same and no copy can be made of the hologram. The hologram manufacturers, who attended the prebid conference suggested that technology of manufacture of hologram should include mastering features, non-mastering features, taggant features and suggested that such technology should be adopted so that the hologram cannot be replicated. The hologram manufacturers, who attended the prebid conference suggested that technology of manufacture of hologram should include mastering features, non-mastering features, taggant features and suggested that such technology should be adopted so that the hologram cannot be replicated. Thereafter, the Deputy Commissioner Excise by communication dated 11.5.2016 informed the Commissioner Excise that the factory should be installed in the State of Madhya Pradesh which shall manufacture holograms for Excise Department exclusively and such arrangement is in place in the State of Tamil Nadu, Andhra Pradesh and Telangana. The Deputy Commissioner submitted a report of the conference which, in turn, was forwarded to the Excise Commissioner on 19.5.2016 to the State Government. 28. The State Government on 20.5.2016 directed constitution of another committee to finalise the terms and conditions of the Notice Inviting Tender. The committee consisting of Additional Excise Commissioner, State Level Flying Squad, Managing Director of Madhya Pradesh Laghu Udyog Nigam Limited or his nominee, Deputy Commissioner Excise Indore, Joint Director Finance, and Assistant Excise Commissioner, Divisional Flying Squad, Bhopal, was formed to provide assistance to Commissioner Excise to frame tender conditions. After due deliberations, the committee recommended that if the period of contract is kept at three years, the price of hologram may increase up to 15% but if it is kept at five years, the price of hologram may increase only up to 10%. Therefore, it was recommended that the decision may be taken to extend the period of contract up to five years. The committee also recommended that the manufacturing capacity of a tenderer should be more than average number of holograms supplied in previous years in the State of Madhya Pradesh and, therefore, recommended incorporation of conditions of turn over and net worth. The committee also recommended that a tenderer should have experience in the manufacture and supply of hologram. 29. The Commissioner Excise by a communication dated 7.6.2016 informed the Deputy Commissioner Excise Flying Squad Indore that the committee has recommended that considering the annual quantum of procurement it would be appropriate to fix average turn over requirement during last three years at Rs. 30 Crores and the net worth may be fixed as Positive Net worth. Thereupon by communication dated 8.6.2016 the Deputy Commissioner Excise Flying Squad informed that taking into account the fact that there may be increase of 10% of consumption every year, the requirement of turn over of Rs. 30 Crores and the net worth may be fixed as Positive Net worth. Thereupon by communication dated 8.6.2016 the Deputy Commissioner Excise Flying Squad informed that taking into account the fact that there may be increase of 10% of consumption every year, the requirement of turn over of Rs. 40 Crores is justified. It was further pointed out that net worth for a company means total assets minus total liabilities and net worth is an important determinant of the value of a company, considering it is composed primarily of all the money that has been invested since its inception, as well as the retained earnings for the duration of its operation. It was further stated that net worth can be used to determine creditworthiness because it gives a snapshot of the company’s investment history. Thereafter the Notice Inviting Tenders was issued, in which requirement of net worth was reduced to Rs. 30 Crores. Thus, from perusal of the record, which has been produced before us, it is evident that the impugned conditions in the Notice Inviting Tender have been incorporated by the committee after detailed deliberations and application of mind. 30. The enhancement in the turn over to Rs. 40 Crores was made in the impugned Notice Inviting Tender, as a tenderer is required to establish plant in the State of Madhya Pradesh and is required to install the latest technology and the equipments. The aforesaid plant is required to work under the supervision of officers of the State Government. The term of the contract has also been enhanced from 2 to 5 years and the bidder has to work for a period of five years with several fluctuating conditions. In addition, three months of rolling capital would be involved to the extent of 3 to 4 months sale, which would be to the tune of 12 to 13 Crores. The petitioner has asserted that a factory can be set up with an investment up to Rs. 5 Crores whereas the State in paragraph 13(D) of the return has denied the same. Therefore, it is not possible for us, in this proceeding under Article 226 of the Constitution of India to record a finding as to the amount with which the plant and machinery for the manufacture of holograms can be set up. 5 Crores whereas the State in paragraph 13(D) of the return has denied the same. Therefore, it is not possible for us, in this proceeding under Article 226 of the Constitution of India to record a finding as to the amount with which the plant and machinery for the manufacture of holograms can be set up. It has been asserted by the State Government that the revenue of the State Government depends on the quality, quantity, security and supply of holograms by the tenderer and the hologram is a security product and public revenue depends on it. All the aforesaid aspects were taken into account by the committee of experts before finalising the draft of proposed tender in the interest of public revenue by way of collection as Excise duty which contributes major share in State revenue, and therefore a decision was taken to insert a condition of setting up a factory by a tenderer under the departmental supervision to ensure better control. 31. Admittedly, the petitioner in Writ Petition No.4448/2016 has supplied 172.88 Crores holograms having turn over of Rs. 41.02 Crores and even in 2014-2015 has supplied 156 Crores holograms having turn over of Rs. 32.11 Crores. Therefore, the conditions of having turn over of Rs. 40 Crores and net worth of Rs. 30 Crores are reasonable conditions. The impugned conditions in the Notice Inviting Tender have been inserted, to prevent sale of spurious liquor and to eliminate the remote possibility of misbranding/mislabelling. Thus, the prime object of insertion of the impugned conditions is to augment public exchequer which is in public interest. The decision has been taken by the committee of experts after due deliberations and this Court in exercise of power under Article 226 of the Constitution of India cannot sit in appeal over the decision taken by the committee of experts. On the touchstone of aforesaid well settled legal principles with regard to scope of judicial review referred to supra, the impugned tender conditions can neither be said to irrational, arbitrary, violative of Article 14 or tailor-made to suit respondents No.3 and 4. Accordingly the issue No.(i) is answered. 32. Now, we may deal with the second issue, namely, whether the impugned tender conditions are against the object of creating a level playing field and contrary to public policy and public interest. Accordingly the issue No.(i) is answered. 32. Now, we may deal with the second issue, namely, whether the impugned tender conditions are against the object of creating a level playing field and contrary to public policy and public interest. The Supreme Court in the case of Reliance Energy Limited (supra), has held that doctrine of level playing field is subject to public interest. We have already held that the impugned tender conditions have been incorporated in the Notice Inviting Tender in the public interest, therefore, doctrine of level playing field has to sub-serve, the public interest. Accordingly, issue no. (ii) is answered. 33. We may advert to third issue, namely, whether the impugned tender conditions are contrary to the guidelines issued by the Central Vigilance Commission. It is trite law that terms of invitation to tender cannot be open to judicial scrutiny because invitation to tender is in the realm of contract. The State Government has the right to get the right and most competent person and should have freedom in the matter of formulating conditions of tender documents, unless the action of tendering authority is found to be malicious and is a misuse of statutory powers, the tender conditions are unassailable. [See, Shimnit Utsch India Private Limited v. West Bengal Transport Infrastructure Development Corporation Limited, (2010) 6 SCC 303 ]. Therefore, the Commissioner Excise has the authority to lay down the terms and conditions of the Notice Inviting Tender and even if the same are violative of the guidelines issued by the Central Vigilance Commission, which even otherwise are directory in nature, the same have no bearing on the issue involved in this petition. Accordingly, the aforesaid issue is answered. 34. Now we may deal with the issue relating to formation of cartel. It is pertinent to mention here that at this stage, the financial bid is not opened, therefore, we are afraid that at this stage the contention of the petitioners that the respondents No.3 and 4 have formed a cartel cannot be examined and the same can be examined after opening of the financial bids. Therefore, at this stage, we refrain ourselves from expressing any opinion on this issue. Accordingly, issue no. (iv) is answered. 35. We may advert to issue no.(v), namely, whether the respondents No.3 and 4 are separate legal entities. Therefore, at this stage, we refrain ourselves from expressing any opinion on this issue. Accordingly, issue no. (iv) is answered. 35. We may advert to issue no.(v), namely, whether the respondents No.3 and 4 are separate legal entities. Section 2(6) of the Act defines the expression ‘associate company’, whereas section 2(87) of the Act defines the expression ‘subsidiary company’. For the facility of reference, section 2(6) and section 2(87) of the Act are reproduced below:- “2(6) “associate company”, in relation to another company, means a company in which that other company has a significant influence, but which is not a subsidiary company of the company having such influence and includes a joint venture company. 2(87) “subsidiary company” or “subsidiary”, in relation to any other company (that is to say the holding company), means a company in which the holding company- (i) controls the composition of the Board of Directors; or (ii) exercises or controls more than one-half of the total share capital either at its own or together with one of more of its subsidiary companies: Provided that such class or classes of holding companies as may be prescribed shall not have layers of subsidiaries beyond such numbers as may be prescribed. Explanation.-For the purpose of this clause,- (a) a company shall be deemed to be a subsidiary company of the holding company even if the control referred to in sub-clause (i) or sub-clause (ii) is of another subsidiary company of the holding company; (b) the composition of a company’s Board of Directors shall be deemed to be controlled by another company if that other company by exercise of some power exercisable by it at its discretion can appoint or remove all or a majority of the directors; (c) the expression “company” includes any body corporate; (d) “layer” in relation to a holding company means its subsidiary or subsidiaries.” Admittedly, the respondent No.4 holds only 3.05% shares in the respondent No.3 company, therefore, the respondent No.3 can neither be termed as associate company nor subsidiary company, as provided under sections 2(6) and 2(87) of the Act. Section 186 of the Act enable the company to take loan and make investment. Therefore, if there are certain business transactions between the respondents No. 3 and 4, no inference can be drawn that the respondents No.3 and 4 are not distinct legal entities. 36. Section 186 of the Act enable the company to take loan and make investment. Therefore, if there are certain business transactions between the respondents No. 3 and 4, no inference can be drawn that the respondents No.3 and 4 are not distinct legal entities. 36. Besides that, it is pertinent to mention that in the annual report of 2013-2014 of respondent No.3, names of subsidiary companies of respondent No.3 has been mentioned in which the name of respondent No.4 does not find place. The respondent No.3 has a factory at Noida as well which is evident from the annual report of 2013-2014. The Board of Directors of respondent No.3 consists of the Directors, namely, (i) Mr. Ashok Chaturvedi, Chairman and Managing Director, (ii) Mr. Ravi Kathpalia, (iii) Mr. M.G. Gupta, (iv) Mr. Achintya Kartiati, (v) Mr. Vijay Kumar Gupta, and (vi) Mr. H.K. Kaushik, whereas respondent No.4 company has two Directors, namely, Mr. M.G. Gupta, who is different from the Director in respondent No.3 company, and another Director, who is not the Director in the respondent No.3 company. Thus, it is evident that the Board of Directors of respondents No.3 and 4 are different and respondents No.3 and 4 are separate legal entities. Accordingly, issue no. (v) is answered. 37. Reverting to the submissions made on behalf of the petitioners that even though the committee had recommended that a tenderer should have experience in the supply of hologram, yet the aforesaid condition has been omitted in the Notice Inviting Tender is concerned, we may refer to clause 19 of the impugned Notice Inviting Tender, which reads as under:- “19. The successful tenderer shall start the supply of Polyester Holograms as per the design approved by the Excise Commissioner within 30 days from the date of placement of purchase order failing which the contract will be cancelled by the Excise Commissioner and the successful tenderer shall be liable for compensating the loss incurred by the department for making alternative arrangements for getting the supply of Holograms. The delivery of Security Holograms shall be as per the schedule to be furnished by the Excise Commissioner at the time of placing order. The delivery of Security Holograms shall be as per the schedule to be furnished by the Excise Commissioner at the time of placing order. The tenderer shall submit PERT CHART indicating time frame for completing within 30 days the various steps involved in the supply of Holograms.” Thus, it is evident that the successful tenderer has to supply the polyester holograms as per the purchase order for which, in our considered opinion, no experience is required. Therefore, even if the condition with regard to experience of supply is dispensed with in the Notice Inviting Tender, the same is inconsequential. 38. So far as the contention made on behalf of the petitioners that the respondents No.4 and 5 have no experience of manufacture of hologram is concerned, suffice it to say that the respondents No.4 and 5 have categorically stated before this Court that they have annexed the documents with regard to their experience of manufacture of holograms along with the tender documents and the eligibility of the respondents No.4 and 5 is to be examined by the tender committee. Therefore, we refrain from expressing our opinion in this regard as the process of evaluation of the tender submitted by the respondents No.4 and 5 is on. So far as the contention raised on behalf of the petitioners that the respondents No.3 and 4 had formed a cartel in the State of Uttar Pradesh and the complaint is being investigated by retired Judge of Allahabad High Court is concerned, suffice it to say that the complainant had filed a writ petition before the Allahabad High Court, namely, Writ Petition No.58597/2012, which was withdrawn by him on 15.3.2014. It has been stated in the return filed on behalf of the respondent No.3 that the aforesaid enquiry is still pending in which no progress has been made as the complainant has failed to appear before the committee. Therefore, the aforesaid contention does not advance the case of the petitioners any further. It has been stated in the return filed on behalf of the respondent No.3 that the aforesaid enquiry is still pending in which no progress has been made as the complainant has failed to appear before the committee. Therefore, the aforesaid contention does not advance the case of the petitioners any further. The submission made by the petitioners that the expression ‘turn over’ used in condition number 3 and the impugned Notice Inviting Tender, has no reference to manufacture of holograms and, therefore, any person who may not have experience in manufacture of holograms may be eligible to participate in the process of tender is concerned, the aforesaid contention is not required to be examined, in view of categorical stand taken by the respondents No.4 and 5 that they have experience of manufacture of hologram and they have submitted documents in this regard along with their tenders. The tender committee shall look into the aforesaid aspect of the matter and, therefore, it is not necessary for us to dilate on the aforesaid issue any further. Similarly, the contention that the conditions are tailor-made and have been incorporated with a view to extend favour to big manufacturers is concerned, the same does not deserve acceptance for the reason recorded by us in the preceding paragraphs wherein after perusal of the record we have held that the tender committee has incorporated the conditions after due deliberations and in public interest and public exchequer which is of paramount consideration while awarding contract. It is pertinent to mention that Supreme Court had upheld impugned conditions in the notice inviting tenders in the case of Association of Registered Plates (supra), wherein only one tenderer was found eligible as per terms of notice inviting tenders. Therefore, the contention that impugned conditions have been incorporated with a view to oust small manufacturers cannot be accepted. 39. It is pertinent to mention that Supreme Court had upheld impugned conditions in the notice inviting tenders in the case of Association of Registered Plates (supra), wherein only one tenderer was found eligible as per terms of notice inviting tenders. Therefore, the contention that impugned conditions have been incorporated with a view to oust small manufacturers cannot be accepted. 39. So far as the submission made by learned counsel for the respondent No.5 that an appropriate proceeding under Section 340 of the Code of Criminal Procedure be initiated against the petitioner in Writ Petition No.4448/2016 for making an incorrect statement in paragraph 9 of the rejoinder is concerned, we are not inclined to initiate the aforesaid proceeding as at the outset, learned senior counsel for the petitioner in Writ Petition No.4448/2016 had sought withdrawal of the aforesaid statement and has expressed his sincere apology in respect of pleading which was made due to inadvertence. 40. So far as submission that financial assistance was given by respondent No.3 to respondent No.5 to enable it to participate in the process of tender, to make the tender look competitive is concerned, the same also does not deserve acceptance as certain amount was paid to respondent No.5 under a consultancy agreement, Annexure R-3-4. We refrain from expressing our opinion with regard to effect of annexing document of respondent No.4 by respondent No.3 as the effect of same has to be dealt with by tender scrutiny committee. 41. The petitioners in Writ Petition No. 4594/2016, Writ Petition No.4664/2016 and Writ Petition No.5071/2016 are not entitled to any relief for yet another reason as they have approached this Court belatedly. The last date of submission of bids was 2.7.2016. The petitioners have filed writ petitions respectively on 1.7.2016, 4.7.2016 and 17.7.2016. Their conduct disentitles them to any relief in exercise of extraordinary jurisdiction under Article 226 of the Constitution of India. 42. Learned Advocate General has taken a specific stand that in case the petitioners have any grievance, they can approach the Excise Commissioner with regard to their grievance. In view of the aforesaid statement by learned Advocate General, the liberty is granted to the petitioners to approach the Excise Commissioner with regard to their grievance, if any. 42. Learned Advocate General has taken a specific stand that in case the petitioners have any grievance, they can approach the Excise Commissioner with regard to their grievance. In view of the aforesaid statement by learned Advocate General, the liberty is granted to the petitioners to approach the Excise Commissioner with regard to their grievance, if any. Needless to state that if the petitioners approach the Excise Commissioner with regard to their grievance, the Excise Commissioner shall take appropriate action on the complaint if any, which may be submitted by the petitioners. We trust and hope that the Excise Commissioner as well as the tender committee shall act with utmost objectivity while dealing with the evaluation of the tenders and shall bear in mind that public interest as well as public exchequer is of paramount consideration while awarding the contract. In case the tender committee comes to the conclusion that the respondents No.3 and 4 have formed any cartel, an appropriate action shall be taken in accordance with the terms and conditions of the Notice Inviting Tender including Clause 37 of the Notice Inviting Tender, which empowers the Excise Commissioner to reject all or any of the tenders. With the aforesaid directions, the writ petitions are disposed of. Order accordingly.