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2017 DIGILAW 189 (JK)

Padma Sharma v. UOI

2017-04-11

RAMALINGAM SUDHAKAR

body2017
JUDGMENT : MP No. 01/2017 For the reasons mentioned in the application coupled with the submissions made at the Bar, same is allowed and the legal heirs of petitioner No. 3, namely, Naveen Sharma are brought on record. MP is, accordingly, disposed of. Registry is directed to make necessary correction in the cause title of the writ petition. OWP No. 1705/2014 1. By the consent of learned counsel for the parties, the writ petition is admitted and taken up for final consideration. 2. This writ petition is of the year 2014. This is third round of litigation. Respondents-State Bank of India, Administrative Office State Bank Building, Rail Head Complex issued an Advertisement Notice (Annexure-A) on 15th of July, 2013. By this Advertisement, they want a premises on lease. The Administrative Office, State Bank of India, Jammu invited offers for renting of commercial premises at Jammu for its Documents Archival Centre (DAC) in the ground floor of a building situated along Jammu-Pathankot Road is on the outskirts of Jammu City with floor area of approximately 20,000 sq. feet (1858 Sq. meter) with minimum of 30 feet frontage. The bank wanted the above space for office use and for storage of the records. 3. The intending parties were directed to submit the Technical as well as the Price Bid as per format to the office of the respondents in two separate sealed covers. Consequent to that, it appears that several persons submitted their two covers bid. That was considered by the State Bank of India (SBI). After the bids were submitted, it appears that the petitioners filed OWP No. 31/2014 (CIMA No. 33/2014) pleading that the petitioners’ Two Covers Bid was not finalized. They alleged that the Bank was deviating them from the NIT. This Court in the above proceeding at the admission stage, passed the following order, which is reproduced hereunder:- “It appears that the petitioners offered a bid in response to NIT issued for leasing commercial premises for housing Documents Archival Centre at Jammu. It is alleged that the respondents are bent upon to violate the terms and conditions of the NIT and are deviating from the same. It is alleged that the respondents are bent upon to violate the terms and conditions of the NIT and are deviating from the same. This writ petition alongwith connected CMA is, accordingly, disposed of by directing the respondent No. 6 to consider the offer of the petitioner in regard to NIT issued for leasing of commercial premises for housing Documents Archival Centre at Jammu and take a decision in this regard within two weeks from the date, copy of this order is made available to the respondents.” 4. The Bank’s grievance is that it was not noticed or heard. The Bank was directed to accord consideration by passing a speaking order. Respondent No. 6 complying with the same, passed order dated 03.02.2014, which reads as follows:- “Now, in the light of the order of Hon’ble High Court and instructions of the Bank, I consider the price bid of the petitioner. After consideration of the price bid of the petitioner vis-à-vis other 4 technically suitable offers, I find that petitioner has offered a rate of Rs. 45/- per sqft. (for 20,000 sqft.), which is Rs. 26/- per sqft. more than the lowest offer of Rs. 19/- per sqft. The offer of the petitioner increases the financial burden of Rs. 26/- per sqft., which ultimately comes to Rs. 5,20,000/- additional cost per month or Rs. 62,40,000/- additional cost per year, when calculated for 20,000 sqft. Moreover, the offer with the lowest price has premises having a built up area of 10,000 sqft., which will facilitate the Bank to shift the Documents Archival Centre (DAC) immediately, which will also enable us to start the shifting of records, as the same has been stopped at the moment due to non-availability of space at the existing DAC.” 5. In fact, the petitioners satisfied the requirements of the Technical Bid, yet the offer was found to be on a higher side and, therefore, it was rejected. The offer made by the other persons on the Price Bid was more conducive on Bank and economical as well and, therefore, the Bank chose to reject the claim of the petitioners. 6. In fact, the petitioners satisfied the requirements of the Technical Bid, yet the offer was found to be on a higher side and, therefore, it was rejected. The offer made by the other persons on the Price Bid was more conducive on Bank and economical as well and, therefore, the Bank chose to reject the claim of the petitioners. 6. Challenging the aforesaid order of the Chief Manager (General Banking), State Bank of India, Administrative Office, Jammu, the petitioners filed another writ petition bearing OWP No. 491/2014 (CIMA No. 696/2014) and the Court disposed of the said writ petition in the following manner without issuing notice to the Bank:- “Since the recommendation has been made by the Chief Manager (respondent No. 6), it is now the respondent No. 3-General Manager, State Bank of India and other authorities, who are to take the final decision. It would be appropriate for the petitioners to file representation before respondent No. 3-General Manager, State Bank of India, which shall be considered before taking any final decision. For disposal of the writ petition on aforesaid terms, there is no requirement of issuing any notice to the respondents, as their right is not prejudiced in any manner, therefore, is disposed of with a direction that the writ petitioners will file representation within one week before respondent No. 3-General Manager, State Bank of India. On receipt of the said representation on aforesaid grounds and on any other ground as shall be available, respondent No. 3-General Manager, State Bank of India shall consider the same and if need arises, hear the petitioners or any other interested person in support thereof and thereafter, take a final decision vis-à-vis acceptance or rejection of recommendation. The decision, so taken, shall be conveyed to the petitioners within three weeks. Right is reserved to the petitioners to re-agitate, if thereafter cause survives. CMA No. 646/2014 also stands disposed of accordingly.” 7. Here again, the Court did not issue any specific direction except stating that the representation should be filed by the petitioners before respondent No. 3-General Manager of the Bank, who will accord consideration to the representation of the petitioners and would pass a speaking order. CMA No. 646/2014 also stands disposed of accordingly.” 7. Here again, the Court did not issue any specific direction except stating that the representation should be filed by the petitioners before respondent No. 3-General Manager of the Bank, who will accord consideration to the representation of the petitioners and would pass a speaking order. Petitioners submitted two representations dated 07.04.2014 and 15.04.2017 (Annexure-N) before respondent No. 3, which came to be considered and a reasoned order was passed on 28th of May, 2014 (Annexure-O) and the order while referring to various factual aspects of the matter, which happened that time, respondent-Bank held that the claim of the petitioners cannot be considered and rejected the same by giving the reasons, which reads as follows:- (i) That Administrative Office, State Bank of India, Jammu had invited offers in double envelope system (i.e., “Technical Bid” and “Price Bid”) for taking on lease of commercial premises at Jammu for housing Document Archival Centre (DAC). The premises was required on ground floor situated along Jammu-Pathankot Road on the outskirts of Jammu City. In response to this, 27 offers were received, out of which only 5 qualified the requirement and were considered as technically suitable by the Committee constituted for this purpose. However, the petitioners/applicants have grievance that property of Sh. Sat Pal Sharma and other two bidders is 500 meter-1000 meter away from Jammu-Pathankot Road and not situated along the Jammu-Pathankot road on the outskirts of Jammu city. It prima facie appears that the petitioners/applicants have very narrowly interpreted the words “situated along Jammu-Pathankot Road on the outskirts of Jammu City” and were repeatedly emphasizing on the same, which otherwise is not practically possible. Even otherwise, the word “along” has been defined in Black’s Law Dictionary (sixth edition) as “Lengthwise of, implying motion or at or near, distinguished from across. By, on, up to, or over, according to the subject-matter and context. The term does not necessarily mean touching at all points; nor does it necessarily imply contact.” So, it can be clearly inferred from this, that consideration of 5 offers, which qualified the technical requirements, by the Committee constituted for this purpose, was bona-fide, without any oblique motives and strictly in consistence with the terms and conditions of invitation of offers by the administrative Office, State Bank of India, Jammu. (ii) The petitioners/applicants have further alleged that the property of Sh. (ii) The petitioners/applicants have further alleged that the property of Sh. Sat Pal Sharma is not a commercial premises and the same has not been sanctioned by the Jammu Municipal Corporation. It is evident that the said premises was earlier being used as a Banquet Hall (i.e., commercial premises), which has been confirmed by the petitioners/ applicants in their representation itself. Moreover, the said property does not fall within the jurisdiction of Jammu Municipal Corporation, so the question of sanction of Jammu Municipal Corporation does not arise. As such, the allegations in this regard are apparently untenable. (iii) The petitioners/applicants, in their representation, have left untouched the pivotal point of consideration, i.e., the price bid. The said issue has been dealt with aptly by the Committee constituted for this purpose and has been discussed at length in the speaking order dated 03.02.2014 of the Chief Manager (respondent No. 6). It is worthwhile to mention here that the petitioners have failed to appreciate the instructions of the Bank regarding establishing of DACs, which have been quoted by the Chief Manager (respondent No. 6) in this speaking order, which are a sine qua non for procuring premises for DACs. The price bid of the offer of the petitioners/applicants was L4 (Rs. 45/- per sqft.), whereas the offer of Sh. Sat Pal Sharma was L1 (Rs. 19/- per sqft.), which, ipso facto paves the way for its consideration. (iv) It has been observed that the offers in technical bids were shortlisted having regard to the requirements of the Bank, i.e., situation and areas etc. There is nothing wrong found in shortlisting of the premises, as the location of the premises are along the Jammu-Pathankot Highway, as discussed by me in para 7(i) above. On the basis of the above findings/observations, I am of the opinion that recommendations of the Committee and thereafter speaking order/decision dated 03.02.2014 of the Chief Manager (respondent No. 6) are in order, as found in accordance with terms and conditions of the offer and without any prejudice, hence do not require any interference. I consider that no right of the petitioners has been violated.” 8. Aggrieved by this order, the present writ petition has been filed by the petitioners. 9. I consider that no right of the petitioners has been violated.” 8. Aggrieved by this order, the present writ petition has been filed by the petitioners. 9. It appears that in the instant writ petition, the following interim order was passed on 30th of December, 2015, which reads as follows:- “Petitioners have responded to the NIT (Annexure-A to the petition), whereby State Bank of India invited offers to hire a premises as per the specifications given in the tender notice. Petitioners are aggrieved that the respondents are avoiding to respond to the offer. It is, stated that the price quoted by the petitioners is too high and the Bank would not be in a position to consider the offer and that the offer made by the petitioners may be only considered in case petitioners reasonably slash down the rates/price quoted in their offer. It appears that the site offered by the petitioners is most appropriate place to house the Cyber Center, the only difficulty for the bank is the price quoted by the petitioners. It is admitted by Mr. Jain that the facility is yet to be set up and accommodation acquired. In compliance of order dated 29.05.2015, petitioners have slashed down the rates quoted by Rs.2/-, i.e., from Rs.45/- to Rs.43/- per square feet. Let petitioners make fresh offer after reasonably slashing down the price quoted, so that respondents are in a position to consider the offer made by the petitioners.” 10. Thereafter, the matter has come up today and the same has been taken up for final disposal. 11. The primary contention of the learned counsel for the petitioners is that property of the petitioners is situated on the main road of Jammu-Pathankot National Highway and technically, the petitioners have qualified, though their Price Bid is higher than their competitors. On the other hand, the other persons who have offered, their property is not situated on the main road, but one kilometer away from the National Highway road and, therefore, there is a deviation from the Notice Inviting Tender (NIT) and the entire proceeding is bad. According to the petitioners, the Bank has acted in an arbitrary manner to reject their claim and has tried to accommodate the private respondents. 12. Petitioners have placed reliance upon a judgment of this Court titled “Ladakh Road Lines and Anr. Vs. According to the petitioners, the Bank has acted in an arbitrary manner to reject their claim and has tried to accommodate the private respondents. 12. Petitioners have placed reliance upon a judgment of this Court titled “Ladakh Road Lines and Anr. Vs. Food Corporation of India, reported as 2012 (4) JKJ 838 ” and paragraph No. 23 of the judgment titled “Ghulam Mohammad Dar Vs. State of J&K and ors., reported as AIR 1995 Jammu and Kashmir 1992.” 13. Heard Mr. R.K. Jain, learned Advocate, who appears on behalf of respondents. 14. In this case, the core issue raised by the petitioners is that there is arbitrariness in the act of the Bank in not considering the Technical Bid of the petitioners, whose property is situated on the Jammu-Pathankot Road and, therefore, their property alone should be taken up for consideration. On both counts i.e., Technical as well as the Price Bid, petitioners are the lowest of the bidders, in so far as, the property situated on Jammu-Pathankot Road is concerned, whereas claim was rejected for extraneous reasons. The Bank, on the other hand, clearly states that on the cost factor though the technical bid, the petitioners satisfy on the cost factor, the Bank has chosen better financial offer and it will facilitate the Bank to shift the DAC immediately. Subsequently, based on the directions passed by this Court, respondent No. 3, i.e., General Manager of the Bank has also passed a detailed order, whereby he explained the reasons as to why the claim of the petitioners cannot be considered despite the property being situated at Jammu-Pathankot Road. 15. According to the Bank, the intention was to re-locate the DAC along the Jammu-Pathankot Road at the outskirts of Jammu city and, therefore, they would take into consideration the nature of the building offered and the rental value for that building as necessary factor for entering upon into the contract. The Chief Manager of the Bank states that the interpretation of the word “along Jammu-Pathankot road on the outskirts of Jammu city” would mean that it does not require to touch at all the points of the said road or imply contact with the said road. It has a wider connotation and the Bank by forming a Committee has found that the offer made by the petitioners was not in the best interest of the Bank. It has a wider connotation and the Bank by forming a Committee has found that the offer made by the petitioners was not in the best interest of the Bank. It is clearly stated that there is no oblique motive or malafide in the assessment of the tender submitted. It also further states that the details of the Price Bid have been discussed and it was found that the offer of the petitioners is on the higher side. The reasons given by respondent No. 3, i.e., General Manager of the Bank, justifying the stand taken cannot be faulted. In fact, five offers of the Bank both on Technical as well as Financial side have considered and decided the issue. There is no scope for this Court to interfere in the matter. 16. The narrow interpretation stating that the property situated only on Jammu-Pathankot Road should be accepted is also not an acceptable plea. 17. The NIT clearly states of property along the Jammu-Pathankot Road on the outskirts of Jammu city indicates that the Bank’s intention was to keep off the city limits and the property should along the Jammu-Pathankot Road. That has been explained in Paragraph No. 10.1 of the reply of respondent No. 3-General Manager of the Bank dated 28th of May, 2014 (Annexure-O), as stated above. 18. In nutshell, it is for the Bank to decide, which is the best suited offer for the Bank to establish its Documents Archival Centre (DAC). Merely because the Bank has indicated that the property should be situated on a particular area, as indicated in the Notice Inviting Tender (NIT) that does not give a right to the petitioners’ to say that their property alone should be considered. As amongst the various offers made, it is the Bank, which has to decide, which offer is the best suited to them. 19. In this case, as stated by the Bank, a Committee has been constituted consisting of five offers to verify and decide, which is the best place and the offer in the interest of the Bank. The petitioners cannot find fault with the decision making process of the Bank, as to which will be the more appropriate place for the Bank to establish its DAC. 20. The petitioners cannot find fault with the decision making process of the Bank, as to which will be the more appropriate place for the Bank to establish its DAC. 20. The reliance placed on the two decisions, as stated above, will have no relevance in the present case, because the observation made in Ghulam Mohammad Dar’s case (supra), does not apply to the instant case because the question of exercising the extraordinary jurisdiction does not arise because of the assessment of five offers made by the parties and the evaluation of the bid is strictly within the domain of the Bank and it is not for the Court to interfere in the decision making process, as to which offer will be more suited to the Bank. That exercise cannot be undertaken by this Court to re-do the exercise in terms of the Article 226 of the Constitution of India read with Section 103 of the Constitution of Jammu and Kashmir. Therefore, the observations made in Ladakh Road line’s case (supra) has no relevance, as it is a case where if the allegations of malafide are proved or if there is larger public interest involved, then the question of interference by the Court can be countenanced, whereas in the present case, the Bank has taken an offer for 5% and though a Committee has assessed the merits of rival offers and taken a decision, there cannot be a question of arbitrariness, malafide or against public interest. On the other hand, the lesser offers have been taken by the Bank apparently keeping in mind the financial interest of the Bank. 21. In terms of the decision of Hon’ble Supreme Court in the case titled “Siemons Public Communication Pvt. Ltd. and Anr. Vs. Union of India and ors., reported as AIR 2009 SC 1204 ”, the principle of judicial review will apply in the cases of arbitrariness, favoritism or against public interest. The scope of judicial review in tenders has been considered in the following decisions of the Hon’ble Apex Court:- (i) Sanjay Kumar Shukla Vs. Bharat Petroleum Corporation Limited and others, (2014) 3 SCC 493 . (ii) Rajasthan Housing Board and Another Vs. G.S. Investments and Another, (2007) 1 SCC 477 . (iii) Jagdish Mandal Vs. State of Orrisa and Others, (2007) 14 SCC 517. 22. As already observed, none of these three ingredients are established in the present case. 23. Bharat Petroleum Corporation Limited and others, (2014) 3 SCC 493 . (ii) Rajasthan Housing Board and Another Vs. G.S. Investments and Another, (2007) 1 SCC 477 . (iii) Jagdish Mandal Vs. State of Orrisa and Others, (2007) 14 SCC 517. 22. As already observed, none of these three ingredients are established in the present case. 23. Before parting, the two writ petitions filed earlier have been disposed of at the admission stage without hearing the Bank and that has caused a serious inconvenience to the Bank enabling it to put forward its case. In fact, the two orders are the innocuous orders, which say that the representation should be considered. 24. In this regard, this Court is inclined to refer to paragraph No. 37 of the judgment rendered in case titled “Tamil Nadu Generation and Distribution Corporation Ltd. (TANGEDCO) Rep. by its Chairman and Managing Director and Anr. Vs. CSEPDI-Trishe Consortium, Rep. by its Managing Director and Anr, reported as, AIR 2016 Supreme Court 4879”, same is reproduced hereunder:- “37. Before parting with the case, we are constrained to add something. We do so with immense pain. The respondent, before finalization of the financial bid submitted series of representations and seeing the silence of the owner it knocked at the doors of the writ court, which directed for consideration of the representations. We are disposed to think that the High Court at that stage should have exercised caution. If the Courts would exercise power of judicial review in such a manner, it is more likely to cause confusion and also being jeopardy in public interest. An aggrieved party can approach the Court at the appropriate stage, not when the bids are being considered. We do not intend to specify. It is appreciable the owner in certain kind of tenders call the bidders for negotiations to show fairness transparently. But the present case is not a one of such nature. Once the price bid was opened, a bidder could not have submitted representations on his own and seek a mandamus from the Court to take certain aspects into consideration. We have stressed this aspect only to highlight the role of the Court keeping in mind the established principle of restraint.” 25. In fact, in paragraph No. 37 of the above said judgment, the Court says that financial implication should be left to the wisdom of the financial experts and consultation. We have stressed this aspect only to highlight the role of the Court keeping in mind the established principle of restraint.” 25. In fact, in paragraph No. 37 of the above said judgment, the Court says that financial implication should be left to the wisdom of the financial experts and consultation. In the present case, the financial implication of leasing out the premises was decided by the Bank and it was found that the lowest offer should be taken, and, therefore, this Court cannot sit over the decision of the Bank in deciding, which offer to take. 26. In this view of the matter, the writ petition is found bereft of merit and is, accordingly, dismissed.