Sai Constructions Building Material Supplier v. State of M. P.
2020-02-10
AJAY KUMAR MITTAL, VIJAY KUMAR SHUKLA
body2020
DigiLaw.ai
ORDER Mittal, C.J.--1. The present writ petition under Article 226 of the Constitution of India has been preferred for quashing of the fresh NIT No. 162/2019-20/e-tendering/HBAD dated 9.10.2019 (Annexure P-1) issued by the Executive Engineer, Public Works Department, Division Hoshangabad, District Hoshangabad i.e. the respondent No. 4 herein. The petitioner has also prayed for a direction to the respondents to proceed as per the earlier tender and grant of time to execute the agreement and then to perform the work within 18 months therefrom. 2. The facts giving rise to this writ petition are that the petitioner is a registered contractor. The respondent No. 4 issued a Notice Inviting Tender (NIT) dated 6.10.2018 for construction of road from Bamhori Khurd Main Canal to Itarsi Dolariya Main Road, length 3.60 km. The petitioner participated in the tender process and his bid was accepted being the lowest one vide letter dated 7.6.2019 (Annexure P-2) whereby the petitioner was asked to submit performance guarantee in the form of term deposit receipt/ bank guarantee and sign the contract agreement within 15 days. In the writ petition, it is further averred that the petitioner was/is ready to execute the said agreement but the respondent No. 4 without issuing any specific order and giving opportunity of hearing in respect of the said NIT dated 6.10.2018 issued a fresh tender notice dated 9.10.2019 as contained in Annexure P-1. A representation dated 1.7.2019 (Annexure P-4) has been submitted to the respondent in respect of performance security and payment of work which has been performed by him but no heed has been paid. The petitioner earlier filed a writ petition before this Court against the impugned NIT being W.P. No. 27953/2019 but the same was withdrawn with liberty to file properly constituted petition. Hence, the present petition. 3. Learned counsel for the petitioner has vehemently argued that once the letter of acceptance of the bid for the construction work in question in pursuance to earlier NIT was issued in favour of the petitioner then without affording any opportunity of hearing and without any specific order in respect of the said NIT and letter of acceptance, a fresh tender notice Annexure P-1 for the same work could not have been issued.
He further submitted that as per earlier tender notice dated 6.10.2018 time period was given that the agreement will be executed about eight months later giving time period for completion of the work within 18 months but the impugned tender notice has been issued in violation of the terms and conditions of earlier tender. In this background, it was prayed that the impugned NIT is not tenable in the eye of law. 4. On the other hand, learned counsel for the respondents-State argued in support of the impugned NIT inter alia contending that on the face of the averments made in the writ petition, no case for interference is made out in the present petition. Inasmuch as, under the garb of challenging the impugned NIT the petitioner wants that he may be granted further time to execute the agreement in pursuance to earlier NIT and also that this Court should interfere with the terms and conditions of the impugned NIT and hence, the reliefs sought for by the petitioner are not legally sustainable. 5. We have heard learned counsel for the parties and find that there is no merit in the present petition. 6. We would have ordinarily liked to call for the response from the respondents but a perusal of the representation dated 1.7.2019 filed by the petitioner at Annexure P-4 prima facie shows that the petitioner has not furnished the performance security/performance guarantee with the respondents as envisaged under clause - (a) of the letter of acceptance dated 7.6.2019 (Annexure P-2) by which he was required to submit the same amounting to `12,31,003/- within 15 days from the date of issue of the said letter. Therefore, the petitioner vide representation dated 1.7.2019 has made a request for extension of time to furnish the performance security and execute the agreement. It is seen that in the letter of acceptance a note is appended that time allowed for carrying out the work as entered in the bid is twelve months including rainy season from the date of signing the contract agreement. Under these circumstances, if the petitioner has failed to comply with the terms and conditions of the said letter, no fault can be laid at the doors of the employer in issuing the fresh NIT for execution of the same work. 7.
Under these circumstances, if the petitioner has failed to comply with the terms and conditions of the said letter, no fault can be laid at the doors of the employer in issuing the fresh NIT for execution of the same work. 7. As regards the argument that the letter of acceptance was already issued in favour of the petitioner and, therefore, the petitioner was required to be given opportunity of hearing before issuing the fresh NIT is concerned, the said submission is stated to be rejected. We may add that acceptance of the offer by the employer was not reduced into written agreement or contract, which the petitioner was specifically asked to do vide letter dated 7.6.2019 and, therefore, the said letter of acceptance is of no consequence and the same does not confer any right in favour of the petitioner. The letter of acceptance was merely the first step towards completion of the agreement between the parties in pursuance to the NIT. It is not the case of the petitioner that the agreement was signed between the parties and, therefore, the respondents were bound to allow the petitioner to execute the work in question. On the other hand, the petitioner himself did not furnish the performance security and still has filed the present petition seeking direction to the respondents to grant further time for execution of the agreement. The authority has absolute right to drop the tender at any time before right flows in favour of a party whose tender is accepted. In this view of the matter, we do not find any error in the action taken by the respondents. 8. The Supreme Court in Tata Celluar v. Union of India (1994) 6 SCC 651 , has laid down various principles whereby it has been held that there should be sufficient play in the joints with regard to making of economic decision and the Court cannot sit over the decision which had been taken in its wisdom by the State. The relevant extract of the said judgment reads as under: "94. The principles deducible from the above are: (1) The modern trend points to judicial restraint in administrative action. (2) The Court does not sit as a Court of appeal but merely reviews the manner in which the decision was made. (3) The Court does not have the expertise to correct the administrative decision.
The principles deducible from the above are: (1) The modern trend points to judicial restraint in administrative action. (2) The Court does not sit as a Court of appeal but merely reviews the manner in which the decision was made. (3) The Court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. Normally speaking, the decision to accept the tender or award the contract is reached by process of negotiations through several tiers. More often than not, such decisions are made qualitatively by experts. (5) 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 (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides. (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure." 9. Thus, in tender or contract matters, interference by Courts is very limited. Power of judicial review will not be invoked to protect private interest at the cost of public interest or to decide contractual disputes. Interference is permissible if the process adopted or decision made is mala fide or intended to favour someone or the same is so arbitrary and irrational that no responsible authority acting under the law could have arrived at it or it affected the public interest. Learned counsel for the petitioner has not pointed out any mala fide intention on the part of the respondents in taking decision to issue another NIT for the same work for which the bid of the petitioner was accepted. 10. Apart from the aforesaid, it is seen that in the first round of litigation against the impugned NIT i.e. W.P. No. 27953/2019, the same was withdrawn on 8.1.2020 (Annexure P-5) with liberty to approach the competent authority to review the claim in the writ petition by filing a representation.
10. Apart from the aforesaid, it is seen that in the first round of litigation against the impugned NIT i.e. W.P. No. 27953/2019, the same was withdrawn on 8.1.2020 (Annexure P-5) with liberty to approach the competent authority to review the claim in the writ petition by filing a representation. It appears that thereafter, no representation has been submitted before the competent authority and again the petitioner has moved this Court raising the same grievance on the ground that earlier petition was not properly constituted. 11. In view of the foregoing reasons, we do not find any illegality in issuing subsequent tender notice by the respondents inviting fresh bids from the eligible contractors. No interference is warranted. The writ petition sans substance and is hereby dismissed.