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2021 DIGILAW 736 (AP)

Chaitanya Jyothi Welfare Society v. State of Andhra Pradesh

2021-11-02

R.RAGHUNANDAN RAO

body2021
ORDER : This is the fourth round of litigation on the question as to who shall undertake the sanitation services in the 3rd respondent-temple. This litigation has been going on for the past two years while the sanitation in one of the premier temples of the State continues to suffer. 2. The earlier litigations were W.P.No.18822 of 2020 disposed of on 31.03.2021; W.P.Nos.12845 and 13365 of 2021, disposed of on 03.08.2021; and W.P.No.18127 of 2021 disposed of on 04.09.2021. Without going into the earlier rounds of litigation, it would suffice to say that the present round of litigation had been initiated by the second lowest bidder in the tender bearing Rc.No.M1/1153/2021-2022, issued for providing sanitation and housekeeping services for the period 01.08.2021 to 31.03.2023 in the 3rd respondent-temple. 3. In the aforesaid tender, the 3rd respondent-temple had sought bids for providing housekeeping, mechanised sanitation, sweeping services to the 3rd respondent-temple from 01.08.2021 to 31.03.2023. The tender itself stipulated that the minimum number of persons that need to be employed by the successful tenderer for providing the above services would be 6 supervisors, 60 male housekeeping unskilled staff and 110 housekeeping unskilled female staff. Clause-3.4 of the tender condition also stipulated that the tender should be in compliance with all the relevant laws in the State. 4. The bids given by various interested persons in response to this tender, were processed. The lowest tenderer’s bid had been rejected on the ground that the wage component of the bid of the said tenderer was below the minimum wage payable for the persons to be employed. Thereupon, the tender process itself was rejected and a fresh tender process was initiated. At that stage, the petitioner, who was the second lowest tenderer, had come before this court with the contention that the bid of the petitioner should have been considered upon disqualification of the lowest tenderer, and the cancellation of the entire tender process by the 3rd respondent is an arbitrary decision. 5. At that stage, the petitioner, who was the second lowest tenderer, had come before this court with the contention that the bid of the petitioner should have been considered upon disqualification of the lowest tenderer, and the cancellation of the entire tender process by the 3rd respondent is an arbitrary decision. 5. Sri K. Madhava Reddy, learned Standing counsel for the 3rd respondent, on instructions, submits that the bid of the petitioner was also found to be in violation of the Minimum Wages Act, as the minimum wages payable for the 176 persons that are to be appointed would come to Rs.17,57,571/- per month, whereas the petitioner had offered a bid of Rs.17,10,925/-, which is lower than the minimum wages payable (this is the actual wages payable to the employees and without taking into account the further additions of ESI, EPF, TDS, which would load about 18.2% over and above the basic wages). He would submit that on account of this fact, the entire tender process has to be scrapped. 6. Ms. Jyothi Anumolu, learned counsel for the petitioner would submit that the bid of the petitioner was in accordance with the Minimum Wages Act as the wages set out for M/s. APSRTC, following the Minimum Wages Act, was taken into account by the petitioner for calculating the minimum wages at Rs.17,10,925/-. 7. Sri K. Madhava Reddy, learned Standing Counsel for the 3rd respondent-temple has placed before this Court, the notification issued under the Minimum Wages Act. A comparison of the figures relied upon by the petitioner on one hand and the 3rd respondent on the other, would show that there is a discrepancy in the minimum wages payable to supervisors. The petitioner calculated the minimum wage for a Supervisor at Rs.11,477/- per month, while the 3rd respondent calculated the minimum wage payable to a supervisor at Rs.17,568.20 ps. This has resulted in a variation of about Rs.47,000/- per month between the petitioner’s calculation and the calculation of the 3rd respondent. As the calculation of the 3rd respondent appears to be on the basis of the Minimum Wages Act with effect from 01.04.2021, it cannot be said that the scrapping of the entire tender process is arbitrary. 8. In the normal course, this would close the controversy. However, the fact remains that this issue has resulted in four rounds of litigation, which requires to be closed. 9. 8. In the normal course, this would close the controversy. However, the fact remains that this issue has resulted in four rounds of litigation, which requires to be closed. 9. The two primary issues that are arising in this unending litigation is the question of compliance with the Minimum Wages Act and the cost of material that is to be used in the course of the sanitation services being offered. 10. Various bids offered by different tenderers at different points of time have been rejected primarily on the ground that the said bids made initially/in the course of reverse tendering have given a wage component, which is below the minimum wage component payable to the employees. Even in the present case, the entire tender has been rejected on the ground of violation of the Minimum Wages Act. This would appear to be a reasonable act on the part of the 3rd respondent. However, the manner in which the earlier contracts have been executed would show that the 3rd Respondent has not been consistent in this aspect. To illustrate this with an example, let us say the minimum wage payable at the time of issuance of a tender notification, for a period of one year, is taken at Rs.20,00,000/- and the successful bidder offers Rs.20,25,000/- the bid would be accepted. Thereafter, when the minimum wage increases to Rs.20,50,000/- on the revision of the wages at the end of six months, the contractor ends up bearing the burden of the additional Rs.25,000/- per month. In this manner, both parties are entering into the contract with a clear intention that subsequent increases, in the wages shall fall on the contractor. However, the 3rd respondent insists on cancellation of tenders on the ground that the initial offer is below the minimum wages payable. 11. In these circumstances, the continuous rejection of bids on the ground of violation of the Minimum Wages Act requires to be reviewed. 12. The 3rd respondent-temple has two options to get out of this controversy. Firstly, the 3rd respondent-temple can stipulate in the tender conditions that irrespective of the figure quoted by the bidder, in the wage component of the bid, the burden of ensuring that minimum wages are paid according to the law shall be on the successful bidder. 12. The 3rd respondent-temple has two options to get out of this controversy. Firstly, the 3rd respondent-temple can stipulate in the tender conditions that irrespective of the figure quoted by the bidder, in the wage component of the bid, the burden of ensuring that minimum wages are paid according to the law shall be on the successful bidder. In the alternative, the 3rd respondent-temple could also stipulate that while the initial bid of the tenderer cannot be less than the minimum wages payable, any further increase in the wage component on account of revision of minimum wages, shall be borne by the temple itself. 13. As far as the material cost is concerned, it is found that in the last two rounds of litigation, the bidders have quoted extremely low figures. For example, in the present case, the petitioner has bid an amount of Rs.500/- towards consumables against the estimated cost of Rs.5,30,000/- towards consumables by the 3rd respondent. The bidder claim that such a low bid is being offered on account of the devotion of it’s members to the deity and their interest in obtaining this contract even at a loss. Such sentiment may be genuine. However, the 3rd respondent would have to take into account these issues also and either come up with a system of ensuring a minimum price of the consumables or to accept such offers by the tenderers at face value. 14. In the circumstances, this writ petition is disposed of permitting the 3rd respondent to go ahead with the tender process underway. However, the 3rd respondent shall keep in mind the following : 1. The 3rd respondent shall set out the minimum wages calculated by the 3rd respondent as part of the tender. 2. After setting out the said minimum wages, the 3rd respondent shall also stipulate as to whether any further revision of minimum wages would be borne by the successful tenderer or by the temple. 3. The 3rd respondent-temple shall also take a call on the minimum permissible amount which can be quoted towards material cost and set out the said minimum amount in the tender itself. 4. The 3rd respondent-temple shall also stipulate that any bid, which goes below the minimum figures set in the tender, shall stand disqualified. 5. 3. The 3rd respondent-temple shall also take a call on the minimum permissible amount which can be quoted towards material cost and set out the said minimum amount in the tender itself. 4. The 3rd respondent-temple shall also stipulate that any bid, which goes below the minimum figures set in the tender, shall stand disqualified. 5. In the event of reverse tendering being taken up, the said reverse tendering shall be stopped when the minimum quoted prices are reached. 6. At that stage, the 3rd respondent shall take into account all the bidders, who have offered the minimum rates, and evolve a procedure for ascertaining who would be best suited among all the tenderers who have offered the minimum quoted rates and award the tender to the person best suited, on the basis of the criteria evolved by the 3rd respondent and set out in the tender document. 7. As the bids have already been received in the present tender, it would be appropriate for the 3rd respondent to issue a corrigendum to the said tender notification incorporating these directions and affording the bidders an additional opportunity of amending their bids to be in line with the above guidelines. In the event of any difficulty in following these directions on account of any constraints due to the e-portal system, the 3rd respondent is permitted to comply with these directions manually. As a sequel, pending miscellaneous petitions, if any, shall stand closed. There shall be no order as to costs.