Research › Search › Judgment

Gauhati High Court · body

2020 DIGILAW 682 (GAU)

D. D. L. Enterprise v. Sedi Allied Agency

2020-09-28

MANISH CHOUDHURY, N.KOTISWAR SINGH

body2020
JUDGMENT : N. KOTISWAR SINGH, J. 1. Heard Mr. P.J. Saikia, learned counsel for the appellant. Also heard Mr. B.D. Goswami, learned Additional Advocate General assisted by Mr. A. Chandran, learned Government Advocate, State of Arunachal Pradesh. 2. The present appeal has been preferred by the appellant against an order dated 04.09.2020 passed by the learned Single Judge in WP (C) No. 67(AP)/2020 which also disposed of the related I.As namely, I.A. (Civil) Nos. 49/2020 and 52/2020. The said writ petition was disposed of after hearing all the parties concerned. 3. The said writ petition was filed by M/s Sedi Allied Agency, through its proprietor and two co-power of attorney holders (the respondent Nos. 1-3/writ petitioners) seeking for setting aside and quashing the approval letter No. GD/S-08/2019-2020/1482 dated 12.12.2019 accepting the technical bids of the private respondent Nos. 6, 7 and 8 (the appellant herein) for the work “C/o Improvement and Extension of Likabali Township Road (10:00 Km) under NESIDS” and also for issuing of certiorari by setting aside and quashing the Corrigendum No. GD/S-08/NESIDS/2019-20/855 dated 20.09.2019 and also for issuing a mandamus by directing the respondent authorities to reject the bids of the private respondent Nos.6, 7 and 8 (the appellant herein) as they are ineligible as per the Rule 4(ii) of the Arunachal Pradesh District Based Entrepreneurs and Professionals (Incentives, Development and Promotional) Rules, 2015 and to consider and accept the bids submitted by the petitioner firm/respondent Nos. 1-3. 4. Only the brief facts, as may be relevant may be mentioned. The Executive Engineer, Gensi Division, Public Works Department, Arunachal Pradesh, issued a Notice Inviting Tender (NIT) on 05.09.2019 for online Item Rate bids on two bid system for the work “ Improvement and Extension of Likabari Township Road (10.00 Km) under NESIDS” with an estimated cost of Rs. 991.00 lakhs only from the registered contractors of Arunachal Pradesh Public Works Department (APPWD) in Class-I domiciled within territorial jurisdiction of the Lower Siang District/East Siang District (Adjacent District) as per Arunachal Pradesh District Based Entrepreneurs and Professionals Rules. Thereafter, a corrigendum was issued on 20.09.2019 by the Executive Engineer, PWD Gensi Division, whereby the eligibility of bidders for the work notified by the aforesaid NIT was amended to allow only registered Class-I contractors domiciled within the territorial jurisdiction of Lower Siang District and bidders from adjacent district of East Siang District were dispensed with. 5. Thereafter, a corrigendum was issued on 20.09.2019 by the Executive Engineer, PWD Gensi Division, whereby the eligibility of bidders for the work notified by the aforesaid NIT was amended to allow only registered Class-I contractors domiciled within the territorial jurisdiction of Lower Siang District and bidders from adjacent district of East Siang District were dispensed with. 5. The petitioner firm as well as the present appellant (respondent No. 8 in the writ petition) participated in the said NIT but the petitioner’s bid was rejected as not eligible on the ground that as the petitioner firm was not a domicile of Lower Siang District. The bids of the present appellant and the other two bidders were accepted by the authorities and were awarded the work in terms of the impugned orders dated 12.12.2019 and 20.09.2019. Awarding of tender in favour of the appellant and other two bidders were put to challenge by the respondent Nos. 1-3/petitioners in the said writ petition. 6. The learned Single Judge while examining the eligibility of the successful bidders also the examined the eligibility of the petitioner firm (respondent Nos. 1-3 herein) as per the relevant Act and Rules i.e. the Arunachal Pradesh District Based Entrepreneurs and Professionals (Incentives, Development and Promotional) Act, 2015 (hereinafter referred to as the “2015 Act”) and the rules framed thereunder, namely, the Arunachal Pradesh District Based Entrepreneurs and Professionals (Incentives, Development and Promotional) 2015 Rules (hereinafter referred to as the “2015 Rules”). 7. Referring to Section 2 of the 2015 Act, which defines as to who District Based Entrepreneurs and Professionals are and also with reference to the Rules framed thereunder, the learned Single Judge came to the conclusion that the eligible contractors/entrepreneurs are those who are not only domiciled of the concerned district but also registered under the Arunachal Pradesh Contractors Enlistment Rules, 2008 (hereinafter referred to as the “Enlistment Rules”) and held that the proprietor of the petitioner firm himself not being a permanent resident of the Lower Siang District was not eligible as pointed by the respondents in the writ petition. 8. The Ld. Single also examined the eligibility of the respondents therein including the present appellant and arrived at the conclusion based on the definition provided under the aforesaid Act and the Rules referred above that the respondent Nos. 8. The Ld. Single also examined the eligibility of the respondents therein including the present appellant and arrived at the conclusion based on the definition provided under the aforesaid Act and the Rules referred above that the respondent Nos. 6, 7 and 8 (the appellant herein) though may be permanent residents of Lower Siang District, yet they were not registered contractors under the Enlistment Rules but were registered as Class-IA contractors with the Public Works Department, Government of Assam and as such they were also not eligible under the 2015 Act and Rules as they did not meet the requirement of the rules and accordingly, set aside the impugned award of contract in their favour. 9. Mr. Saikia, learned counsel for the appellant (respondent No. 8 in the writ petition) has submitted that the said writ petition was not at all maintainable for the reason that the petitioner firm was not eligible. Moreover, as the petitioner had taken part in the tender process, the petitioner could not have raised the issue of eligibility of the appellant and other bidders. In other words, having participated in the tender process, the petitioner was estopped from challenging the tender process and subsequent award of the tender. That apart, it has been submitted by the learned counsel for the appellant that though the appellant himself is not registered under the Enlistment Rules, it is registered with the Public Works Department of Govt. of Assam. It has been also submitted that there was no stipulation in the NIT that the contractors have to be enlisted in Arunachal Pradesh. He accordingly, submits that since the successful bidders were found to be technically qualified and financially sound by the authorities, there was no irregularity in the tender process and awarding of the work in favour of the appellant and other successful bidders. 10. Learned Counsel for the appellant submits that considering the fact that there was not a single Class-I registered contractor available in Lower Siang District, the authorities allowed the local contractors domiciled in Lower Siang District and registered as Class-I contractors in Assam to take part in the tender process so that the development works do not suffer for the lack of eligible contractors in the district. 11. 11. It has been also submitted that the purpose of the 2015 Act is to ensure greater participation by the District Based Entrepreneurs and Professionals as a part of Government policy to facilitate decentralization of development activities with greater participation of people from the nook and corners of the State of Arunachal Pradesh to build a society of people with uniform, social and economic status of the State. It was submitted that it cannot be denied that the appellant and other two successful bidders were residents of the local district and as such allotting works to the appellant and others cannot be said to be contrary to the aim and spirit of the 2015 Act. 12. It has been also submitted that on rejection of the bid of the petitioner firm and on representation being submitted to the authorities, the same was considered but was rejected by the authorities on 14.10.2019, against which the petitioners did not raise any objection or challenge the same before the Court. 13. Learned counsel for the appellant also submits that the State Government themselves had filed an interlocutory application before the learned Single Judge for vacating the interim stay granted earlier for smooth execution of the work. In other words, according to the learned counsel for the appellant the State Government did not have any objection as regards award of the contract in favour of the appellant and the other successful bidders for the reason that they were residents of the concerned district. 14. Learned Counsel for the appellant submits that unfortunately learned Single Judge did not consider all these aspects and while dismissing the writ petition also set aside the work orders issued in favour of the appellant and other bidders on the ground that they were also not eligible. Ld. Counsel for the appellant submits that once the petitioner firm was not found to be eligible, the petitioners did not have locus standi to challenge the award of work in favour of the successful bidders and the matter ought to have been put to rest without going into the other aspects of the tender process. 15. Ld. Counsel for the appellant submits that once the petitioner firm was not found to be eligible, the petitioners did not have locus standi to challenge the award of work in favour of the successful bidders and the matter ought to have been put to rest without going into the other aspects of the tender process. 15. It has been submitted that effect of this order of the learned Single Judge would deprive the local residents of the district to execute the work merely on technical ground that they were not registered with the Arunachal Pradesh Public Works Department (APPWD) though they were domiciled within territorial jurisdiction of the Lower Siang District. It has been submitted that since there is not a single eligible contractor under the Act and Rules, the works will suffer and as such since the petitioners themselves were not eligible, the petition ought to have been dismissed on the ground of non-maintainability without going into the merit of the tender process. 16. Learned Additional Advocate General for the State, however, submits that the State Government would abide by the decision rendered by the learned Single Judge. 17. It appears that the decision of the learned Single Judge was primarily based on the issue as to eligibility of the petitioner firm as well as the private respondents therein including the present appellant. If the petitioners had alleged in the writ petition that the private respondents therein were not qualified, merely because it was also found that the petitioner firm was also not eligible, in our view may not entail mere closure of the writ petition. The eligibility of all the bidders is the foremost foundational requirement for participating in the tender. Thus if certain facts which touch upon the eligibility of the parties including the successful bidders have been brought on record and not disputed, the Court would certainly be entitled to examine the same. Further, the petitioner firm was not a stranger. He was a participant in the tender process and by virtue of it certainly had a right to question the participation in the tender process of anyone who is not otherwise eligible, even if he is also ultimately found to be not eligible. Further, the petitioner firm was not a stranger. He was a participant in the tender process and by virtue of it certainly had a right to question the participation in the tender process of anyone who is not otherwise eligible, even if he is also ultimately found to be not eligible. The issue raised in the writ petition was not merely any irregularity or illegality in the tender process, but the very eligibility to participate in the tender process which goes to the root of the matter, thus the most fundamental of all the issues involving the tender process. 18. It was vehemently argued by the learned counsel for the appellant that the writ petition was not at all maintainable and ought to have been dismissed at the threshold as the petitioner firm was not eligible and neither any fundamental right or legal right of the petitioner firm was affected. As such, there was no need for the learned Single Judge to go to any other aspect including the issue of eligibility of the successful bidders. Though the appellant may be correct in holding that if the writ petition itself is not maintainable on the ground that the petitioner firm does not have any right to challenge as it is not eligible or that its right is not affected, that should have been the end of the matter. But if any incidental issue comes up for consideration which goes to the root of the eligibility of the successful bidders regarding which the respondents themselves have not contested, we are of the view that the decision of the learned Single Judge to examine the eligibility of the other bidders cannot be said to be improper. 19. The fact that the successful bidders themselves including the appellant were not eligible is borne out from the records and not denied by them. 20. Section 2(b) of the 2015 Act provides that “District Based Entrepreneurs and Professionals” means and includes any person who is involved in activity of execution of development and welfare project of the Government and includes Architects, Engineers, Contractors, Doctors etc., but does not include any government official. It has been further provided that the person must be a local having Arunachal Pradesh domiciled certificate and is a permanent resident of the District. It has been further provided that the person must be a local having Arunachal Pradesh domiciled certificate and is a permanent resident of the District. Though the 2015 Act provides that the eligible persons must be domiciled in the concerned area/district there is no reference about registration with the State of Arunachal Pradesh which is provided by the 2015 Rules. 21. Rule 4(ii) of the 2015 Rules mentions that the contractors/entrepreneurs before participating in the tenders must satisfy the following conditions:- (a) The District Based Entrepreneurs and Professionals must be duly registered under the Arunachal Pradesh Contractors Enlistment Rules, 2008 in the appropriate class of category and that the Registration is must be valid on the date of participation of tender, a copy of which must be submitted to the tendering authority. (b) If the District based Entrepreneurs and Professionals who have their firm already got registered as contractors under Arunachal Pradesh Contractors Enlistment Rules, 2008 have the address different from their domiciled territorial jurisdiction, they shall be allowed to participate in the tender on production of proof of permanent resident certificate in support of their claim. (c) The contractors who has been awarded the work by call of tender shall not sub-let his work, failing which the authority shall be competent to rescind the contract and take suitable course of action. (d) The Categories-IV and V contractors shall be exempted from requirement for producing proof of completion of works similar type in last five years to qualify for participation in a tender. (e) In the larger interest of the public and for equitable distribution of developmental works amongst eligible contractors and also to ensure effective management and quality of works, a contractor shall be allowed to have only 2(two) works in hand in any of departments under Government of Arunachal Pradesh at a time and for which he shall make a declaration to be executed in an Affidavit that he is not engaged in more than two any tenders works under the State Government. He shall also for participation in any tender be required to submit completion certificate issued by the Engineer-in-charge duly counter signed by the concerned Superintending Engineer and Chief Engineer. He shall also for participation in any tender be required to submit completion certificate issued by the Engineer-in-charge duly counter signed by the concerned Superintending Engineer and Chief Engineer. (f) In the event of inadequate response to a tender invited at block level/Assembly Constituency level, the eligible contractor of adjacent block/Assembly Constituency within the district shall be eligible to participate in the subsequent call of that tender. (g) In the event of inadequate response to a tender invited at District level tender for an amount of Rs. 5 crore to Rs. 10 crore, all eligible indigenous of Arunachali contractor domiciled and registered under Arunachal Pradesh Contractor Enlistment Rules, 2008 shall be eligible to participate in the subsequent call of that tender and if the cost of works is above 10 crore, all the registered contractors in Class I and contractors shall be eligible to participate. (Emphasis added) 22. When the writ petition was filed questioning the eligibility of the private respondents therein including the appellant, they did not take the plea that they were eligible but took the plea that they were the most qualified, technically and financially. They claimed to be eligible as per the corrigendum issued and the NIT did not specifically mention that the contractors have to be registered under the 2008 Enlistment Rules. We are afraid, such a plea is not tenable for the reason that even if the NIT does not specifically mention as to the requirements of registration under the 2008 Enlistment Rules, it has to be read into it in as much as there could not be any tender issued in violation and contravention of the 2015 Rules and the statute i.e. 2015 Act governing the field. The fact that the appellant is not registered as a contractor under Arunachal Pradesh Contractors Enlistment Rules, 2008 being not disputed and also having admitted that he is registered with the Public Works Department of Govt. of Assam, which is not in consonance with the 2015 Rules, obviously, even if the aforesaid requirement of enlistment under the Arunachal Pradesh Contractors Enlistment Rules, 2008 is not specifically mentioned in the tender, will not confer any benefit to the appellant as regards eligibility. If the appellant is not eligible under the 2015 Rules, he is not entitled to participate in the tender process. 23. If the appellant is not eligible under the 2015 Rules, he is not entitled to participate in the tender process. 23. We are also mindful of the fact that in the impugned order passed by the learned Single Judge various issues raised by the appellant in the said proceeding were not considered. But in our opinion, the same will not make any difference in as much as the appellant including the other successful tenderers themselves being not eligible in terms of the 2015 Rules and the 2015 Act as mentioned above, could not have participated in the tender process and as such considering other issues raises would not be required to be undertaken. 24. We do not subscribe to the view of the learned counsel for the appellant that if the petition was not maintainable as the petitioner firm was not eligible, the learned Single Judge ought not have considered any other aspect including the eligibility of the successful bidders. As observed earlier, the issue of eligibility of the successful bidders was also foundational one which could not have been ignored as the petitioner had also specifically raised the same. Further, once there is a finding, and also not disputed by the appellant, that the bidders were not eligible, there is no need to examine any other issue. 25. The contention of the learned counsel for the appellant that since there is no eligible contractors available in the district, subsequent issuance of any fresh tender will be a futile exercise as no one will be able to bid for any such tender. We are not convinced with the said submission for the reason that if there are difficulties in implementing the Act and the Rules which mandates certain conditions to be fulfilled, the authorities are not without any power to make necessary amendments in the rules to facilitate participation of local inhabitants of the district, which is within the domain of the authorities. 26. We would also like to mention that there is a provision under the Rule 4(ii)(g) of the 2015 Rules quoted above which provides that in the event of inadequate response to a tender invited at District level tender for an amount of above Rs. 5 crore upto Rs. 26. We would also like to mention that there is a provision under the Rule 4(ii)(g) of the 2015 Rules quoted above which provides that in the event of inadequate response to a tender invited at District level tender for an amount of above Rs. 5 crore upto Rs. 10 crore, all eligible indigenous Arunachali contractors domiciled and registered under Arunachal Pradesh Contractor Enlistment Rules, 2008 shall be eligible to participate in the subsequent call of that tender and if the cost of works is above Rs. 10 crore, all the registered contractors in Class I and contractors shall be eligible to participate. The aforesaid provision of Rule 4(ii)(g) does not specify that the contractors have to be domiciled in the particular district only but have to be registered under Arunachal Pradesh Contractor Enlistment Rules, 2008. Without commenting on the applicability of the aforesaid rules, the authorities could consider invoking the aforesaid provision in subsequent tender process and we leave it to the wisdom of the authorities concerned. 27. Accordingly, for the reasons discussed above, we are not inclined to entertain this appeal and accordingly the same is dismissed at this stage.