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2022 DIGILAW 1009 (RAJ)

Society For Human Development And Research v. State Of Rajasthan

2022-03-30

SANDEEP MEHTA, VINOD KUMAR BHARWANI

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JUDGMENT : MEHTA, J. 1. Through this writ petition under Article 226 of the Constitution of India, the petitioner, an NGO registered with the Cooperative Department, Government of Rajasthan, has approached this Court with a prayer to strike down the constitutional validity of Sections 5(2)(e), 6(2)(c) and Section 7(2) (f) of the Rajasthan Transparency in Public Procurement Act, 2012 (hereinafter referred to as ‘the Act of 2012’) being violative of the object and spirit of the Act of 2012. The petitioner is mainly aggrieved of the conditions Nos.5(2)(e), 6(2)(c) and 7(2)(f) of the Act which read as below:- “Section 5: Determination of need for procurement:- …. (2) While assessing the need under sub-section (1), the procuring entity shall take into account the estimated cost of the procurement and also decide on the following matters, namely:-… (e) any other matter as may be prescribed. ...” “Section 6: Participation of bidders : …. (2) The State Government may, by notification in this behalf, provide for mandatory procurement of any subject matter of procurement from any category of bidders, and purchase or price preference in procurement from any category of bidders, on the following grounds, namely :… (c) any other consideration in public interest in furtherance of a duly notified policy of the Central Government or the State Government. ...” “Section 7: Qualifications of bidders : …. (2) Any bidder participating in the procurement process shall :… (f) fulfill any other qualifications as may be prescribed. ...” 2. Learned counsel Shri Ramdev Rajpurohit associate to Shri Rajvendra Sarswat, Advocate representing the petitioner, urged that by taking recourse of these provisions, the respondents have applied very onerous and unreasonable conditions in the tender process which are impossible to fill. As per Shri Rajpurohit, the respondents issued Notice Inviting Bid (NIB) for Rajasthan Rural Water Supply and Fluorosis Mitigation Project in Nagaur vide notice dated 27.08.2020 wherein, very arduous conditions, as summarized below, were incorporated which made it impossible for the petitioner to participate in the tender process even though it is otherwise competent to perform the work prescribed in the Tender:- “That the bidder must have an average annual turnover not less than Rs.14.43 crores during the last three financial years. That the bidder should have an experience of execution or successful completion of similar nature of at least one work costing not less Rs.7.22 Crores during the last seven years.” Learned counsel Shri Rajpurohit urged that these unreasonable and arduous conditions have been incorporated in the tender process by invoking the above provisions of the Act of 2012 which are absolutely unreasonable, arbitrary and contrary to the letter and spirit of the Act of 2012 and hence, the provisions which give a handle to the procuring entity to impose arbitrary conditions in the Tenders so as to create classes amongst equals, should be declared ultra vires and struck down. In support of his contentions, Shri Rajpurohit placed reliance on the Judgment dated 06.06.2018 rendered by the High Court of Delhi in the case of Allied Integrated Society (Regd.) & Ors. vs. The State (NCT of Delhi (Writ Petition (C) No.5912/2018 & Civil Misc. Application No.23033-23034/2018). 3. The respondents have filed reply to the writ petition wherein, the challenge laid by the petitioner to the above provisions of the Act of 2012 has been refuted. It has been mentioned at para No.7 of the reply that the above provisions of the Act of 2012 are further governed by the Rajasthan Transparency in Public Procurement Rules, 2013 (hereinafter referred to as ‘the Rules of 2013’) which have not been challenged in this writ petition. The justification has been offered by the respondents in the reply regarding the questioned provisions which is reproduced herein below for the sake of convenience: “Section 5(2)(e) which provides for “any other matter as may be prescribed”, it can be well said that the provisions does not give any unfettered, arbitrary, unreasonable and/or blanket power to the procuring entity. The other matters which might be prescribed and considered as per the said provisions are required to be in accordance with the rules of 2013. Rule 5 & 6 of the rule of 2013 are regarding determination of need for procurement. Thus, in no eventuality the impugned provisions 5 (2)(e) is in conflict with the objects of the enactment. The same is rather in nexus to the object and well in accordance with the spirit of law. Coming to section 6(2)(c) of the Act of 2012, again it can be said that the same is well in line with the spirit and objects of the Act of 2012. The same is rather in nexus to the object and well in accordance with the spirit of law. Coming to section 6(2)(c) of the Act of 2012, again it can be said that the same is well in line with the spirit and objects of the Act of 2012. The section 6 empowers State Govt. to limit any procurement to any category of bidders on the reasons given therein. Section 6(2)(c) provides one such eventuality where the participation of bidders can be limited. It provides the eventuality where the participation of bidders can be limited. It provides the eventuality of any consideration which is in public interest in furtherance of a duly notified policy of the Central Govt. or the State Govt. For the purpose of exercising the power, the State Govt. by way of notification can limit the participation of bidders in the eventualities provided in the section itself. Sub section 4 of the section 6 as under: “Nothing in this section shall be construed as preventing the State Government or any procuring entity from imposing or enforcing measures limiting participation on account of the need – (a) to protect public order, morality or safety; (b) to protect human, animal or plant life or their health; (c) to protect intellectual property; (d) to protect the essential security and strategic interest of India.” Therefore, from the bare reading of section 6 of the Act of 2012 in its entirety it becomes apparent that no arbitrary, unreasonable, unfettered, blanket powers have been given to the procuring entity for limiting the participation of bidders. Rather section 6(2)(c) empowers the State Govt. to take into consideration the factors/aspects related to public interest in furtherance of a duly notified policy of the Central Govt. or the State Govt. The provision in question serves the purpose of the enactment of which it is a part and provides a fair classification for consideration of the eventualities in public interest in furtherance of a duly notified policy of the Central Govt. or the State Govt. The provision, thus, has a clear nexus with the aim and object of the legislation. In any eventuality, the petitioner is not able to point out as to how this particular provision is coming in the way of the petitioner and giving it a legitimate reason to challenge the same. or the State Govt. The provision, thus, has a clear nexus with the aim and object of the legislation. In any eventuality, the petitioner is not able to point out as to how this particular provision is coming in the way of the petitioner and giving it a legitimate reason to challenge the same. However, even otherwise the provision in question is well in the line of the object of the Act of 2012 and his not in violation to any of the provisions of the enactment. The petitioner has further assailed Section 7(2)(f) which asks for fulfilling any other qualification as may be prescribed. Before going to the said provision, it would be necessary to point out that the petitioner has not demonstrated as to how this provision in particular is affecting any of the rights of the petitioner in regard to the NIT in question. Be that as it may, it is submitted that the Section 7 of the Act of 2012 provides qualifications of bidders. Sub Section (1) of section 7 provides that a procuring entity may determine and apply one or more of the requirements specified in sub section (2) for a bidders to be qualified for participating in procurement process. Sub Section (2) of the Section 7 provides some requirements which or some out of which, the prospective bidder has to posses. Section 7(2)(f) refers to fulfilling any other qualifications as may be prescribed. Again it would be pertinent to mention here that the provision no where gives unfettered, uncheck powers to the procuring entity as the same are always within the scope of powers as defined under the Act of 2012 and Rules of 2013.” It is also mentioned in Para No.88 of the reply that the first bid in pursuance of the tender in question was cancelled due to price quoted by the bidders. The second bid was invited on 04.04.2016 but the contract of the NGO was terminated in January, 2018 because of non-performance. The third bid/offer initiated on December 2018, failed because no bids were received. Finally, the questioned process was initiated. As many as 22 potential bidders participated therein. In all, 7 bidders including 5 NGOs were considered. The second bid was invited on 04.04.2016 but the contract of the NGO was terminated in January, 2018 because of non-performance. The third bid/offer initiated on December 2018, failed because no bids were received. Finally, the questioned process was initiated. As many as 22 potential bidders participated therein. In all, 7 bidders including 5 NGOs were considered. Thus, the respondents have duly demonstrated that there is no arbitrary intention behind the questioned conditions of the tender process and the provisions of the Act of 2012 have not been invoked so as to intentionaly exclude any NGO. 4. We have given our thoughtful consideration to the submissions advanced at bar and, have gone through the impugned provisions and the documents placed on record. 5. Ex facie, judgment of the High Court of Delhi, which has been relied upon by the petitioner’s counsel, is not applicable to the facts of the present case because in the said judgment, the eligibility conditions of the aspirants was not based on any statute akin to the Act of 2012. The Hon’ble Delhi High Court, after analyzing all the conditions of the tender, found the same to be irrational and arbitrary in view of the earlier pattern of the MCD. However, in the present case, the tender conditions are guided by the Act of 2012 and the Rules of 2013 and hence, the same cannot be held to be illegal or invalid in any manner whatsoever. The conditions of the potential bidders having proper turnover in the previous three financial years and of experience in similar works, cannot be held to be unjust, arbitrary or pervasive in any manner whatsoever. The petitioner has given challenge to the provisions of the Act of 2012 but these provisions are further required to be applied in accordance with the Rules of 2013 which are not under challenge in this writ petition. 6. Having analysed the statutory provisions, referred to supra, and the justification thereof as offered in the reply of the respondents, we find that none of these statutory provisions can be termed to be illegal, arbitrary or contrary to the purposes of the Act of 2012 so as to be declared ultra vires. 6. Having analysed the statutory provisions, referred to supra, and the justification thereof as offered in the reply of the respondents, we find that none of these statutory provisions can be termed to be illegal, arbitrary or contrary to the purposes of the Act of 2012 so as to be declared ultra vires. For the sake of reference, it may be mentioned here that the respondents have clearly demonstrated that 5 NGOs were allowed to participate in the questioned tender process as they were compliant with these very conditions of which the petitioner is aggrieved. Thus, there is no foundation behind the objection of the petitioner that the tender conditions have been modulated/framed in such a manner so as to exclude the NGOs from being compliant in the tender process. 7. As a consequence, the writ petition fails and is hereby dismissed as being devoid of merit. Stay application also stands dismissed.