Bharat Fritz Werner Limited Having Its Registered Office v. Office Of The Development Commissioner
2020-07-23
P.S.DINESH KUMAR
body2020
DigiLaw.ai
JUDGMENT P S Dinesh Kumar, J. - Though this petition is listed for orders regarding completion of service of notices on respondents, Smt.D.N.Mamatha, learned CGC placing reliance on the decision of Hon'ble Supreme Court in Oil and Natural Gas Commission Vs. Utpal Kumar Basu and Others, (1994) 4 SCC 711 raised a preliminary objection regarding jurisdiction and strongly urged that writ petition is not maintainable and submitted that any further proceedings in this writ petition is uncalled for. 2. Heard Shri Nikhilesh Rao, learned advocate for the petitioner and learned CGC for the Union of India - respondent No.1. 3. Undisputed facts of the case are, the Development Commissioner of Ministry of Micro, Small and Medium Enterprises (MSME), New Delhi, called tender for supply of CNC Milling Machines in February, 2019. Petitioner having its registered office and works at Bengaluru submitted its bid on 17.07.2019. The bid was opened by the Development Commissioner on 18.07.2019 at New Delhi. Petitioner was declared as "L1" in respect of machines described in lot No.3. Petitioner was declared as "L3" in respect of machines described in lot No.1. Petitioner has quoted Rs.18.69 Crores for supply of machines in lot No.3. However, the Development Officer has awarded tender on 05.06.2020 to M/s. Phillips Corporation, Hanover, Maryland, USA (respondent No.2) who has quoted higher price than the petitioner. 4. The principal objection raised by the learned CGC is that tender was called for in New Delhi. Tender bids were submitted in New Delhi and the communication rejecting petitioner's bid dated 09.06.2020 (Annexure-N) has been sent from New Delhi. Therefore, authority in the case of ONGC (supra) is applicable to the facts of this case and hence, this Court has no jurisdiction to entertain this writ petition. 5. Shri Nikhilesh Rao urged following contentions; Petitioner has its office and manufacturing unit at Bengaluru; Bid was valid for 120 days and the Development Commissioner sought to extend the term of the bid and petitioner has consented for extension of term of the bid by E-mail on various dates from Bengaluru as per Annexures-M series ending with the last extension till 18.05.2020; Respondent No.1 is the Union of India and therefore, in this COVID-19 situation, they ought not have raised this contention with regard to jurisdiction; Petitioner has obtained bank guarantee from Canara Bank situated in Infantry Road, Bengaluru.
With the above submissions, Shri Nikhilesh Rao submitted that part of cause of action has arisen in Bengaluru and therefore, this Court has jurisdiction to entertain this writ petition. 6. In support of his contentions, Shri Nikhilesh Rao placed reliance on following decisions; (i) Om Prakash Srivastava Vs. Union of India and another, (2006) 6 SCC 207 ; and (ii) M/s. P.R.Transport Agency Vs. Union of India, (2006) AIR Allahabad 23 7. I have carefully considered rival submissions and perused the records. 8. In ONGC case (supra), bid was called for by ONGC having its office at New Delhi. Respondent therein was having its office at Calcutta. The bid was rejected by ONGC, New Delhi. Writ petitioner moved Calcutta High Court. The Calcutta High Court entertained the writ petition and allowed it. ONGC challenged the same before the Supreme Court of India. The Apex Court allowed the appeal filed by the ONGC by holding thus: "14. Before we part we must clarify that we have confined ourselves to deciding whether on the averments made in the petition any part of the cause of action is shown to have arisen within the jurisdiction of the Calcutta High Court. Even if we had come to the conclusion that the averments disclosed that a part of the cause of action had arisen within the jurisdiction of the said Court and therefore the petition could be entertained by that Court, it would still have been open for the opposite party to dispute the said averments were not true and correct, the petition, though entertained, would fail for want of jurisdiction. 15. In the result, we allow this appeal, set aside the order of the High Court and direct that the writ petition will stand disposed of for want of jurisdiction. Since we are satisfied that NICCO had not invoked the jurisdiction of the Calcutta High Court bona fide, we think that this is a fit case for granting exemplary costs to ensure that such abuse of the Court's jurisdiction does not take place in future. We, therefore, direct NICCO to pay Rs 50,000 by way of costs." 9. In the case on hand, tender has been called for by the Development Commissioner by advertising in newspapers. Petitioner has submitted it's bid.
We, therefore, direct NICCO to pay Rs 50,000 by way of costs." 9. In the case on hand, tender has been called for by the Development Commissioner by advertising in newspapers. Petitioner has submitted it's bid. The contention urged by Shri Nikhilesh Rao is that in view of Section 13(3) of Information Technology Act, 2000, an E-mail communicating rejection which is received by the petitioner in Bengaluru gives rise to a part of cause of action. Therefore, this Court gets jurisdiction to deal with this writ petition. Other contentions are, having manufacturing unit at Bengaluru, giving consent for extension of bid from Bengaluru and giving bank guarantee from a Bank having its branch in Bengaluru. The last contention is, Union of India is not justified in raising objections with regard to jurisdiction during COVID- 19 pandemic. 10. It is relevant to note that the Development Commissioner called for tenders sitting in his office situated in New Delhi, which is similar to the facts in ONGC case. Petitioner herein has it's office in Bengaluru and Respondent in ONGC case had it's office in Calcutta. 11. With regard to communication of rejection by E-mail, Shri Nikhilesh Rao sought to distinguish judgment in ONGC by contending that in ONGC's case, the letter of rejection was given in hand at New Delhi. But what is relevant is, the factum of rejection and it is not in dispute that petitioner's tender has been rejected by the Development Commissioner in New Delhi. So far as the manufacturing unit is concerned, this aspect is irrelevant at this stage since petitioner's bid has been rejected. With regard to the aspect of bank guarantee, it is a negotiable instrument given by the bank at the request of the petitioner. Petitioner can obtain a bank guarantee from any branch of any bank in the country where he maintains his account. Therefore, the ground with regard to bank guarantee is not tenable. 12. So far as consent for extension is concerned, the consent is for the purpose of extending the validity of the tender and it would end with the rejection of tender. Cause of action which may give rise to any litigation will commence from the date of rejection. Any proceedings prior to the rejection by way of inter-party communication cannot be construed as cause of action having arisen at Bengaluru.
Cause of action which may give rise to any litigation will commence from the date of rejection. Any proceedings prior to the rejection by way of inter-party communication cannot be construed as cause of action having arisen at Bengaluru. So far as the last contention with regard to COVID-19 is concerned, this is a commercial transaction and jurisdiction goes to the root of the matter. Facts of this case, in the opinion of this Court, are identical to the facts in ONGC's case. Therefore, objection raised by the learned CGC merits consideration. 13. In the case of Om Prakash Srivastava (supra), he was extradited from Singapore and kept in solitary confinement in Uttar Pradesh. He initially moved the Hon'ble Supreme Court of India in CRL.P.No.54/2005 and withdrew the same to enable him to move appropriate High court for redressal of his grievance. Subsequently, appellant therein filed a writ petition in Delhi High Court and the same was disposed of holding that since the issue related to conditions of prisoners in the State of U.P., the same could be dealt more effectively by the Allahabad High Court. 14. The Apex Court remitted the matter to the Delhi High Court to hear the matter afresh and to decide whether it had jurisdiction to deal with the writ petition. Therefore, this authority has no application to the facts of this case. 15. In the case of M/s. P.R.Transport Agency (supra), the Allahabad High Court was dealing with the aspect of acceptance of tender communicated through E-mail. Therefore, the said authority also does not support petitioner's case. 16. In view of the above discussions, it is clear that facts of this case are exactly similar to the facts in ONGC's case. Therefore, the objection with regard to jurisdiction raised by the learned CGC is sustained. 17. Resultantly, this writ petition must fail and it is accordingly dismissed. However, it is made clear that this Court has not examined the merits of the case and dismissal of this writ petition does not preclude the petitioner from seeking appropriate relief before appropriate forum. 18. In view of dismissal of this writ petition, all pending interlocutary applications do not survive for consideration and they stand disposed of. No costs.