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2022 DIGILAW 491 (KAR)

H. Shankar Kumar, S/o. Hanumegowda v. State Of Karnataka, rep. By Its Secretary, Department Of Agriculture

2022-04-06

S.G.PANDIT

body2022
ORDER : The petitioner, a Class-I Contractor registered with the Karnataka Public Works Department is before this Court under Article 226 of the Constitution of India, praying for the following reliefs : (i) Issue an appropriate writ, order or direction quashing the Tender Notification bearing No.HFWD/TW/CE/TA/UAE4/NABARD- RADF - 26/TND/ 2021-22/320 DATED 07.06.2021, issued by the 4th respondent, at Annexure-J and J1, in the interest of justice and equity; and (ii) Issue an appropriate writ, order or direction quashing the Government Order bearing No.AGRI/AUM/21/2020[21, Bengaluru dated 12.05.2021 issued by the 1st respondent, at Annexure-Q, in the interest of justice and equity. 2. Brief facts of the case are that, the 3rd respondent-University of Agricultural Sciences (for short “University”) issued tender notification dated 15.04.2021 (Annexure-A) inviting tenders for construction of Girls Hostel, Library Building and Boys Hostel. Under Annexure-B on the same date, one more notification was issued inviting tenders for construction of Administrative Building, Classrooms and Laboratory. All these works to be carried out at Chamarajanagara Campus. In respect of both the works, last date for submitting tender was 24.05.2021, opening of technical bid was 26.05.2021 and opening of financial bid was on 02.06.2021. The petitioner submitted his tender along with the earnest money deposit (for short “EMD”). In all, the petitioner is said to have deposited Rs.39,19,200/- with the 3rd respondent. The petitioner is said to have submitted all the required documents and the Banker’s Certificate. It is stated that the status of the tender as on 14.06.2021 was showing as “Under Evaluation”. When the petitioner and other bidders were expecting opening of the financial bid, 4th respondent issued Annexure-J/tender notification dated 07.06.2021 inviting tenders for the construction of Administrative Building, Classrooms, Laboratory, Girls Hostel and Library Building at Agricultural College, Chamarajanagar with estimated cost of Rs.2500.00 Lakhs. It is stated that the works under Annexure-J issued by the 4th respondent covered the works tendered under notifications at Annexures-A and B. The petitioner challenging the tender notification issued by the 4th respondent dated 07.06.2021 vide Annexure-J and paper publication vide Annexure-J1 is before this Court in this writ petition. 3. It is stated that the works under Annexure-J issued by the 4th respondent covered the works tendered under notifications at Annexures-A and B. The petitioner challenging the tender notification issued by the 4th respondent dated 07.06.2021 vide Annexure-J and paper publication vide Annexure-J1 is before this Court in this writ petition. 3. At the fag end of hearing of the present writ petition, the petitioner filed two applications I.A.No.1/2022 to implead the Executive Engineer, Karnataka Housing Board as respondent No.5 on the ground that in respect of the work of construction of Boys Hostel and infrastructure works which were not covered under Annexure-J, the Karnataka Housing Board has issued tender notification. I.A.No.2/2022 is filed praying for an interim order of stay of Annexure-T/the tender notification issued by the Housing Board and Annexure-U/paper publication dated 10.12.2021 and 05.03.2022 respectively. 4. Heard learned Counsel Sri.Ashok B Patil for petitioner; learned Additional Advocate General Sri.Dhyan Chinnappa for respondents No.1, 2 and 4 and Sri.M.Srinivasa for respondent No.3/University. Perused the writ petition papers including the statement of objections filed by the respondents. 5. Learned counsel for the petitioner Sri.Ashok B Patil submits that respondent No.3 University had issued tender notification for construction of Girls Hostel, Library Building, Boys Hostel at Agricultural College, Chamarajanagar on obtaining administrative approval from the Government. The grants were made available under Rural Infrastructure Development Fund (RIDF) and also under NABARD Scheme. The Government, under its letter dated 25.09.2018 (Annexure-K) had sought detailed plan and estimate from the 3rd respondent-University and accordingly, the 3rd respondent-University had forwarded by its letter 12.10.2018 Detailed Program Report (DPR) in respect of the works that were to be carried out at Agricultural College, Chamarajanagar vide Annexure-L. It is submitted that the Government, by its order dated 19.10.2020 granted administrative approval for the works in a sum of Rs.4452.00 lakhs from NABARD loan as well as State’s share which included the works at Chamarajanagar. Learned counsel would invite attention to one more Government Order dated 22.03.2021 wherein grant from RIDF was also made available. Learned counsel would invite attention to one more Government Order dated 22.03.2021 wherein grant from RIDF was also made available. It is contended that though the above Government Orders were issued on approval from the Cabinet on 18.02.2021, subsequent to Cabinet approval and issuance of Government Order authorizing the 3rd respondent-University to issue tenders and subsequent to issuance of tender by respondent No.3, the State Government could not have handed over the tendered works to the 4th respondent at the instance of Agricultural Minister. Learned counsel submits that on 22.04.2021 subsequent to issuance of tender notification by respondent No.3, Agricultural Minister takes a decision and directs issuance of Government Order to hand over the tender work to the 4th respondent. Learned counsel places reliance on Rule 15 of I Schedule to the Karnataka Government (Transaction of Business) Rules, 1977 (for short “1977 Rules”) and submits that once the Cabinet accords administrative approval to the work, the Minister has no role to play and could not have taken a decision to handover the work to 4th respondent, that too after issuance of tender notification by the 3rd respondent-University. 6. Learned counsel for the petitioner next contends that the tender invited under Annexures-A and B both dated 15.04.2021 is neither proceeded nor cancelled. Placing reliance on Section 14 of the Karnataka Transparency in Public Procurement Act, 1999 (for short “1999 Act”), it is submitted that, unless the 3rd respondent cancels or rejects the tender, the 4th respondent could not have issued the impugned tender notification in respect of the same works. Learned counsel would contend that the Tender Inviting Authority or Tender Accepting Authority could cancel or reject tenders only on the grounds stated therein under Section 14 of the 1999 Act. As there is no cancellation or rejection of tenders by the 3rd respondent, it is prayed for a direction to the 3rd respondent to finalize the tenders under Annexures-A and B. 7. Learned counsel lastly contended that in respect of the works relating to the 3rd respondent-University, which is an independent autonomous body, the Government could not have interfered with the work of 3rd respondent and could not have directed to handover the works to the 4th respondent. Learned counsel lastly contended that in respect of the works relating to the 3rd respondent-University, which is an independent autonomous body, the Government could not have interfered with the work of 3rd respondent and could not have directed to handover the works to the 4th respondent. Learned counsel would also submit that the work relating to construction of Boys’ Hostel at Chamarajanagara is handed over to Karnataka Housing Board which is also illegal and in that regard he submits that I.A.Nos.1 and 2 of 2022 are filed. 8. Per contra, the learned Additional Advocate General Sri.Dhyan Chhinnappa submits that there is no merit in any of the contentions raised by the petitioner. He submits that Cabinet had taken decision to accord administrative approval of the amount involved in the work. Referring to Rule 15 of 1977 Rules, he submits that approval of Cabinet is required only towards approval of work estimates and not with regard to the agency which has to execute the work. It is his submission that the Cabinet approved the estimates on 18.02.2021 and thereafter the University issued tender notifications under Annexures-A and B. It is also his submission that wherever the development works are carried out by the State with the assistance of the NABARD in terms of the NABARD guidelines, the “State” shall have to carry out such works. Learned AAG contends that the petitioner has not acquired any right as the bid submitted by the petitioner in pursuance of Annexures-A and B notifications were not evaluated or opened as on the date of impugned tender notifications. Mere submission of tender would not give any right to the petitioner. It is submitted that even before pre-bid meeting was to take place, the concerned Agricultural Minister on 22.04.2021 took decision to hand over the work to 4th respondent and issued note in that regard. Thereafter, letter dated 02.06.2021 was issued to the Vice-Chancellor of 3rd respondent to hand over materials and work to the 4th respondent. On receipt of the above communication, the 4th respondent issued impugned tender notification. 9. Learned AAG further submits that since the tenders received in pursuance of Annexures-A and B notifications by the 3rd respondent are not opened and not evaluated, there was no need to pass any order under Section 14 of the 1999 Act. On receipt of the above communication, the 4th respondent issued impugned tender notification. 9. Learned AAG further submits that since the tenders received in pursuance of Annexures-A and B notifications by the 3rd respondent are not opened and not evaluated, there was no need to pass any order under Section 14 of the 1999 Act. Moreover, he submits that the procuring entity itself is changed and the EMD is returned to the petitioner. Further, he submits that the petitioner has received the returned EMD. It is the submission of the learned AAG that the purpose and object of Section 14 is to see that the tender Accepting Authority at its whims and fancies should not issue tenders and cancel without assigning any reason. In the present case, since the procurement entity itself is changed by the Government, Section 14 would have no application. With regard to the last contention of the petitioner that the Government could not have interfered with the tender notification issued by the 3rd respondent as it is an independent and autonomous body, it is submitted that if the 3rd respondent-University has no objection, the petitioner cannot have any objection. Petitioner, a tenderer could submit his tender if it is called either by the 3rd respondent or 4th respondent. So long as the petitioner is not prohibited from submitting his tender, he cannot have any objection with regard to calling of tender either by 4th respondent or 3rd respondent, as the case may be. 10. Learned counsel Sri.M.Srinivas for respondent No.3/University while adopting the submission of the learned AAG submits that in pursuance of the Government Order dated 12.05.2021 (Annexure-Q) the 3rd respondent-University handed over the construction work at Chamarajanagar to the Engineering Section of Health and Family Welfare Department. 11. The only point which falls for consideration is as to whether impugned tender notification requires interference? 12. Answer to the above point would be in the negative for the following reasons. The petitioner mainly contended that the Cabinet had taken a decision to entrust the work of construction of Girls Hostel, Library Building, Boys Hostel at Agricultural College, Chamarajanagar to the 3rd respondent-University. Subsequently the Minister for Agriculture could not have taken a decision to hand over the said work to the Health and Family Welfare Department. The petitioner mainly contended that the Cabinet had taken a decision to entrust the work of construction of Girls Hostel, Library Building, Boys Hostel at Agricultural College, Chamarajanagar to the 3rd respondent-University. Subsequently the Minister for Agriculture could not have taken a decision to hand over the said work to the Health and Family Welfare Department. At the outset it is to be noticed that the Cabinet had not taken decision to entrust the work to the 3rd respondent-University, but the Cabinet had only approved for establishment of Agricultural college at Chamarajanagar; estimates of the work and for release of grants for establishment of agricultural college, as evidence from the Cabinet note and the approval of Cabinet placed before the Court by learned AAG. Sequence of events would indicate that the Government in Agriculture Department had accorded administrative approval to the 3rd respondent-University to proceed with construction of Agricultural College and related works at Chamarajanagar. On 22.04.2021, the Minister for Agriculture issued a note to take action to issue order to entrust the infrastructural work at Chamarajanagar Agricultural college to Engineering Division of Health and Family Welfare Department. Based on the said note, Government Order dated 12.05.2021 (Annexure-Q) was issued. In pursuance to the Government Order dated 12.05.2021, by letter dated 02.06.2021 addressed to Vice-Chancellor of 3rd respondent-University was asked to hand over the work to the Health and Family Welfare Department. Pursuant to which, the impugned tender notification dated 07.06.2021 was issued by the 4th respondent-Chief Engineer. As pointed out by the learned AAG, the fund for the construction of the infrastructure facility at Chamarajanagar is from RIDF-26 and from the assistance of NABARD. In that regard, Government Order dated 19.10.2020 reads as follows: From the above, it is clear that administrative approval was issued for infrastructural work of Agricultural college at Chamarajanagar and to expend from NABARD assistance as well as from State share. From NABARD guildelines for utilization of the loans made avaualbe by the NABARD, referring to Annexure-R1, the learned AAG submits that the State Government shall execute and complete the projects for which, the loans are granted, within such time as stipulated in the sanction letter. From NABARD guildelines for utilization of the loans made avaualbe by the NABARD, referring to Annexure-R1, the learned AAG submits that the State Government shall execute and complete the projects for which, the loans are granted, within such time as stipulated in the sanction letter. When the NABARD requires the State Government to implement and complete the project, the State Government has rightly taken decision to hand over the infrastructural project at Agricultural College at Chamarajnagar to the 4th respondent, since the project is assisted by the finance from the NABARD. Therefore, no fault could be found with the action of the State Government in handing over the work from 3rd respondent to 4th respondent. 13. Learned counsel for the petitioner in support of his submission relied on Rule 15 of I Schedule to the 1977 Rules. Rule 15 requires administrative approval of Cabinet with regard to work estimates where it exceeds Rs.10.00 Crores. In terms of Rule 15, the Cabinet had accorded administrative approval to the estimate with the assistance from the NABARD. As contended, there is no violation of Rule 15 of 1977 Rules. 14. The 3rd respondent by notification dated 15.04.2021 invited tenders for construction of infrastructural facility at Agricultural college, Chamarajanagar. Last date for submitting the tender was 24.05.2021; 26.5.2021 was opening of technical bid and 02.06.2021 was opening of financial bid. Before the last date for submitting the tender, the Government, by order dated 12.05.2021 entrusted the work of infrastructural facility at Chamarajanagar to the 4th respondent. The 3rd respondent except receiving the tenders in pursuance to tender notification dated 15.04.2021 had not proceeded further. The tenders were not opened nor evaluated by the 3rd respondent-University. The petitioner having submitted his tender in pursuance of tender notification dated 15.04.2021 had not acquired any right. Mere submission of tender would not confer any right on the petitioner to contend that the said tender process shall be proceeded further. Even before the last date for submitting the tender, the first respondent-Government handed over the work in question to the 4th respondent. As there was no evaluation of tender, the petitioner has not acquired any right. 15. Learned counsel for the petitioner contended that, without rejecting the tenders on the grounds stated in Section 14 of the 1999 Act and without communicating the rejection, the work in question could not have been handed over to the 4th respondent. As there was no evaluation of tender, the petitioner has not acquired any right. 15. Learned counsel for the petitioner contended that, without rejecting the tenders on the grounds stated in Section 14 of the 1999 Act and without communicating the rejection, the work in question could not have been handed over to the 4th respondent. It is not a case of rejection of tenders either under Section 14 of the 1999 Act or for any other reason by the 3rd respondent-University. It is a case of change of procurement entity. The Government in view of the fact that the work in question is by assistance of NABARD, took a decision to entrust the work in question to the 4th respondent. If it was a general rejection, as contended by the learned counsel for the petitioner, Section 14 would have application. Since it is the case of change of entity, Section 14 would have no application. The purpose and object of Section 14 is to see that the Tender Accepting Authority for extraneous reasons should not cancel or reject tenders so as to invite fresh tenders. To maintain transparency in inviting and finalizing tender by the Tender Accepting Authority, Section 14 is required to be followed. 16. The Hon’ble Apex Court in the case of JAGADISH MANDAL vs STATE OF ORISSA AND OTHERS reported in (2007) 14 SCC 517 has made it clear that, in tender matter, if the decision relating to award of contract is bonafide and is in public interest, Courts will not in exercise of power of judicial review, interfere, even if a procedural aberration or error in assessment or prejudice to a tenderer, is made out. 17. With regard to the contention that the Government could not have withdrawn the work from the 3rd respondent-University to entrust the same to the 4th respondent, it is to be stated that in that regard, the 3rd respondent-University has not raised any objection and on the other hand it handed over the work to 4th respondent. Petitioner cannot have any grievance with regard to handing over of construction of infrastructural work from 3rd respondent to 4th respondent as long as the petitioner is not prohibited or prevented from submitting his tender. Whether the 3rd respondent or 4th respondent invites tender, it is for the petitioner to submit his tender and compete with others. Petitioner cannot have any grievance with regard to handing over of construction of infrastructural work from 3rd respondent to 4th respondent as long as the petitioner is not prohibited or prevented from submitting his tender. Whether the 3rd respondent or 4th respondent invites tender, it is for the petitioner to submit his tender and compete with others. A tenderer could not have any choice or cannot dictate that a particular entity only has to invite tender and get the work implemented. Moreover the infrastructural work at agricultural college, Chamarajanagar is not entirely from the funds of 3rd respondent-University, but on the other hand, it is with the assistance of NABARD finance as well as State share. Therefore, there is no merit in the said contention. 18. For the reasons recorded above, there is no merit in any of the contentions raised by the petitioner, accordingly writ petition stands rejected. I.A.Nos.1 and 2/2022 also stands rejected for the same reasons recorded above.