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Jharkhand High Court · body

2023 DIGILAW 1440 (JHR)

Shiv Lal, (a Proprietorship concern) v. Sido Kanhu Murmu University, through its Vice Chancellor

2023-12-07

ANANDA SEN, SANJAYA KUMAR MISHRA

body2023
ORDER : 1) The simple mixed question of law and fact, which falls for determination in this case, is as follows: “Whether the stipulation in the corrigendum as at Annexure-2 to the writ petition issued as a sequal to the e-Tender dated 18.01.2023 issued by Sido Kanhu Murmu University for security and housekeeping staffs is to be calculated for the purpose of determining, for selecting the lowest tenderer, should be the basic wage per day per person or it should also include the other contributions of the employer like the contributions under the Employees State Insurance Act, Employees Provident Fund Act, Bonus, Uniform Expenses, Uniform Washing, etc.?” 2) By filing this writ petition, the petitioner, a proprietory concern, operating in the name of M/s Shiv Lal, has prayed for the following relief(s):- “(i) For issuance of an appropriate writ/order/direction, for quashing/setting aside the Agreement dated 29th March, 2023 (Annexure-5) entered by and between Sido Kanhu Murmu University and Respondent No.3-M/s. Bajrang Industrial Securities, Jamshedpur, wherein Respondent No.3 has been appointed as an Outsourcing Agency for providing Security Guards and House-keeping staff for deploying the University and its associated campuses, as being wholly illegal, arbitrary being violative of the terms and conditions of the Tender Document dated 18.01.2023 including its Corrigendum. (ii) For issuance of further appropriate writ/order/direction, for quashing/setting aside the Letter bearing Reference No. SKMU/CCDC/189/2023 dated 19.04.2023 (Annexure-8), wherein direction has been issued to all Principal/Professor-in-Charge of Constituent Colleges of the Respondent-University for entering into sub-contract agreement with Respondent No.3-M/s. Bajrang Industrial Securities, Jamshedpur for deployment of Security Guards and House-keeping staff. (iii) For issuance of further appropriate writ/order/direction, including Writ of Declaration, declaring that action of the Respondent-authorities in declaring the financial bid of Respondent No.3 as the Lowest Bid pursuant to Notice Inviting Tender dated 18.01.2023 including its Corrigendum, is per se illegal and arbitrary, actuated with malice in law, with an intent to favour Respondent No.3, especially because Respondent No.3 has not fulfilled the criteria of financial bid, as it has quoted Management Charges less than 5% for deployment of manpower which was specifically prohibited under the Financial Bid/Price Bid. (iv) For issuance for further appropriate writ/order/direction, including Writ of Mandamus, directing the Respondent-University to declare the Financial Bid/Price Bid submitted by the Petitioner as the Lowest Bid, as Petitioner has quoted Management Charges @5%, and, to consequently enter into agreement with the Petitioner for deployment of Security Guards and House-keeping staff in Respondent-University including its associated Campuses.” 3) The facts at this stage are not in dispute. The respondents-University on 18.01.2023 published a Notice Inviting Tender for deployment of Security Guards and other Housekeeping Staffs, including Gardeners, Electricians, Plumbers, Drivers and Cooks on Outsourcing basis in the respondents-University including its various campuses. Later on, the University issued a corrigendum and clarified that the management charges quoted by the bidders less than 5% will not be accepted and such bids shall be rejected. By 28.02.2023, 11 bidders submitted their bids, out of which only 5 bidders fulfilled the technical criteria including the petitioner and the respondent No.3. On 2nd of March 2023 the financial bids of the successful bidders were opened by the respondents-University and it is stated by the petitioner and not disputed by the respondent that the petitioner and M/s. R.S.S. Securities quoted their rate as per the corrigendum calculating 5% of the Management Charges on the total of the basic wages plus other allowances to the workers like bonus, etc. It is also not disputed that the rest of the bidders calculated 5% of Management Charges basing upon the basic wages which is calculated to be Rs.334.14. The petitioner and R.S.S. Securities calculated 5% on the basis of the total wages to be paid calculated at Rs.443.00 only. Thus, as per the successful tenderer, the 5% management charges come to Rs.16.71, whereas the 5% calculated by the petitioner and another has come to Rs.22.15. 4) In the Minutes of the meeting of the Tender Committee, a copy of which has been annexed as Annexure-A to the counter affidavit of respondent No. 3, it came to the conclusion that one M/s. Commando Industrial Securities, Hazaribagh is the L-1 bidder which has quoted the minimum charges being 5% of the basic manpower charge of Rs.334.14. 4) In the Minutes of the meeting of the Tender Committee, a copy of which has been annexed as Annexure-A to the counter affidavit of respondent No. 3, it came to the conclusion that one M/s. Commando Industrial Securities, Hazaribagh is the L-1 bidder which has quoted the minimum charges being 5% of the basic manpower charge of Rs.334.14. However, on 10.03.2023, the respondent No. 3 raised an objection to the declaration of M/s. Commando Industrial Securities, Hazaribagh as the lowest bidder contending, inter alia, that the said bidder had quoted management charge of the 5% of basic rate i.e. Rs.334.14, but it further contended that the 5% of management charges of the basic rate is Rs.16.71, whereas the M/s. Commando Industrial Securities, Hazaribagh has quoted management charge of Rs.16.70. 5) Pursuant to such complaint made by the respondent No. 3, a meeting was convened of the Tender Committee and they revised their decision upholding the objection raised by the respondent No.3 and declared the respondent No. 3 as the lowest bidder having quoted Management Charge of 5% on the basic manpower charge of Rs.334.14. In pursuant to such a decision, an agreement was entered into between Sido Kanhu Murmu University and respondent No.3 M/s. Bajrang Industrial Securities, Jamshedpur. On 19.04.2023 respondents-University issued a direction to all Principals/Professor In-charge of the constituent colleges of the respondents-University to enter into sub-contract agreement with respondent No.3 for deployment of Security Guards and Housekeeping Staffs. On 26.03.2023, the petitioner filed a writ application challenging the decision of the University, respondent No.1. 6) The learned counsel for the petitioner would submit that a conjoint reading of Clauses 9 and 10 of the tender document and the corrigendum in its entirety leaves no doubt that 5% of management charges is to be calculated on the total amount as given in the Annexure-2. He would submit that a tabulated from was issued in the corrigendum indicating the different amount to be paid in different heads and to different categories of employees like Skilled, Unskilled and Semi-Skilled. We consider it appropriate to take note of these provisions by quoting in verbatim the portion of the documents relied upon by all the parties. He would submit that a tabulated from was issued in the corrigendum indicating the different amount to be paid in different heads and to different categories of employees like Skilled, Unskilled and Semi-Skilled. We consider it appropriate to take note of these provisions by quoting in verbatim the portion of the documents relied upon by all the parties. They are as follows:- ^^9- ,tsalh ds }kjk Msªl] twrk] Vksih] VkpZ ;k vU; fdlh en esa dfeZ;ksa ds Hkqxrku ls fdlh Hkh izdkj dh dVkSrh ugh dh tkuh gSA mDr en dks esutesaV pkftZl esa gh lfEefyr djrs gq, quote djuk vko';d gSA fdlh Hkh ifjfLFkfr esa fdlh Hkh lsok dehZ dks muds mifLFkfr ds vuqlkj ljdkj }kjk fu/kkZfjr U;wure etnwjh dk Hkqxrku djuk vko';d gksxkA 10- dfeZ;ks ds Hkqxrku ds i'pkr mldk Hkqxrku iath (Payment Sheet) dh izfr ftl ij lHkh dfeZ;ksa dk izkfIr gLrk{kj gksxk fo'ofo|ky; dk;kZy; esa vxys ekg ds foi= ds lkFk laYkXu djuk vko';d gksxk vU;Fkk lefiZr foi= ij fopkj ugha fd;k tk,xkA izfr ekg ds foi= ds lkFk Hkh dfeZ;ksa ds [kkrs esa EPF, ESI etc. ls laEcaf/kr tek fd;s x, jde dh vfHkizekf.kr izfr Hkh layXUk djuk vko';d gksxkA 7) The following corrigendum was issued later on:- “CORRIGENDUM ¼fufonk vkae=.k lwpuk la-01@2020&23] ckg; lkzsr ls dfeZ;ksa dh vkiwfrZ gsrq fufonk ½ FINANCIAL BID fLknks dkUgq ewewZ fo'ofo|ky;] nqedk Annexure-III ewY; Hkkx As per minimum wages act, of Govt. of Jharkhand revised w.e.f. October 2022 Designation/Description Housekeeping Mali Security Guard Electrician Plumber Driver cook Category Unskilled Semi Skilled Semi Skilled Skilled Skilled Skilled Skilled (in Rs.) (in Rs.) (in Rs.) (in Rs.) (in Rs.) (in Rs.) Wages per day (including VDA)(A) 334.14 350.06 350.06 416.45 416.45 416.45 416.45 ESIC(B) 3.25% 10.86 11.38 11.38 13.53 13.53 13.53 13.53 EPF(C) 13% of A 43.44 45.51 45.51 54.14 54.14 54.14 54.14 Bonus(D) 8.33%of A 27.83 29.16 29.16 34.69 34.69 34.69 34.69 Uniform(E) 5% of A 16.71 17.50 17.50 20.82 20.82 20.82 20.82 Uniform Washing (F 3% of A 10.02 10.50 10.50 12.49 12.49 12.49 12.49 Total (G) (Sum of A to F) 443.00 464.11 464.11 552.13 552.13 552.13 552.13 Management Charge (H) …. % Grand total sum of (G to H) 1. The rates mentioned above will be revised as per the Jharkhand State Govt. Notification, issued from time to time. 2. GST shall be charged as per prevailing Govt. Rules. 3. % Grand total sum of (G to H) 1. The rates mentioned above will be revised as per the Jharkhand State Govt. Notification, issued from time to time. 2. GST shall be charged as per prevailing Govt. Rules. 3. Above rates are being quoted for a shift of 8 hours per day. 4. Cost of housekeeping materials will be reimbursed after submission of the purchase bill. 5. Management charge quoted at less than 5% will not be accepted and such bids shall be rejected. uksV %& (i) foŸkh; fufonk mDr izk:Ik ds vuq:i Mkyuk vfuok;Z gksxkA tks ,tsalh ,slk ugh djsxh mudk foŸkh; fufonk jnn dj fn;k tk;sxkA (ii) foŸkh; fufonk es ,d:irk jgus ij QSlyk ysus dk lEiw.kZ vf/kdkj fo'ofo|ky; izca/ku dk gksxkA\ 8) A plain reading of these documents reveals that the tender invitation was based on the minimum wages as prescribed by the Government of Jharkhand with effect from October, 2022. The rates mentioned in the corrigendum were to be revised as per the Jharkhand State Notification issued from time to time. GST and other rates have to be quoted and deducted. Finally at Clause 5 it has been provided that Management Charge quoted at less than 5% will not be accepted and such bid shall be rejected. The controversies that has cropped up at this stage whether this 5% management charge should be calculated as per the Row (A) which prescribes wages per day (including VDA) or it should include also the Row (B) i.e. the ESI contribution, Row (C) the EPF contribution, Row (D) the bonuses for the employees, Row (E) the money to be paid to the employees for uniform and Row (F), i.e., the uniform washing allowance @ 3%. In all these Rows B to F percentage has been given viz., 3.25%, 13%, 8.33%, 5% and 3% of Row (A), i.e., Rs.334.14. The total sum has been reflected as (G), which is equal to sum of A to F. Then management charges have been referred as (H) and the grand total sum has been taken as total of (G to H). 9) In this view of the matter, we are of the opinion that wages per day including VDA is not the proper amount on which the Management Charges of 5% has to be calculated. Be it mentioned here that the bid document or the corrigendum does not define management charges. 9) In this view of the matter, we are of the opinion that wages per day including VDA is not the proper amount on which the Management Charges of 5% has to be calculated. Be it mentioned here that the bid document or the corrigendum does not define management charges. It has also not specifically provided that 5% of which amount to be paid to each individual worker per day is to be calculated. Thus, it is left to the Court for interpretation. 10) Learned counsel for the University would submit that there was a plethora of judgments of the Hon’ble Supreme Court on this issue and the interpretation given by the University or the employer should be taken to be correct interpretation. He relies upon several Judgments like Jagdish Mandal Vs. State of Orissa & Ors., (2007) 14 SCC 517 , wherein the Hon’ble Supreme Court has held that the interpretation of a tendering authority must prevail unless there is some mala fide alleged or proved. In Afcons Infrastructure Ltd. Vs. Nagpur Metro Rail Corporation Ltd., (2016) 16 SCC 818 , the Hon’ble Supreme Court has held that the owner or the employer of a project, having authored the tender document, is the best person to understand and appreciate its requirements and interpret its document. The Constitutional Courts, the Hon’ble Supreme Court further held, must defer to this understanding and appreciation of the tender documents, unless there is mala fide or perversity in the understanding or appreciation or in the application of terms of the tender conditions. It is possible that the owner or the employer of a project may give an interpretation to the tender documents that is not acceptable to the constitutional Courts, but that by itself is not a reason for interfering with the interpretation given. The learned counsel Dr. It is possible that the owner or the employer of a project may give an interpretation to the tender documents that is not acceptable to the constitutional Courts, but that by itself is not a reason for interfering with the interpretation given. The learned counsel Dr. Singh would also relies upon the later judgment of Hon’ble Supreme Court in Silppi Constructions Contractors vs. Union of India, (2020) 16 SCC 489 , wherein the Hon’ble Supreme Court has held that the essence of law laid down in the judgments referred to is the exercise of restraint and caution; the need for overwhelming public interest to justify judicial intervention in the matters of contract involving the State instrumentalities; the courts should give way to the opinion of the experts unless the decision is totally arbitrary or unreasonable; the court does not sit like a court of appeal over the appropriate authority; the court must realise that the authority floating the tender is the best judge of its own requirements and, therefore, the court’s interference should be minimal. The authority, which floats the contract or tender and has authored the tender document, is the best judge as to how the document has to be interpreted. If two interpretations are possible, then the interpretation of the author must be accepted. Similar views have been taken by later judgments of the Hon’ble Supreme Court, namely, N.G. Projects Ltd. Vs. Binod Kumar Jain and others, (2022) 6 SCC 127 ; Macaull India Private Ltd. Vs. Resources Telecom and Others, 2022 (5) SCC 362 . Though the learned counsel appearing for the University would rely upon these judgments, in course of hearing he conceded that the tendering authority has faulted in not including the contributions to be deducted from the wages and also the contribution to be made by the employer under the Employees’ State Insurance Act and Employees’ Provident Funds and Miscellaneous Provisions Act and, therefore, the learned counsel Dr. Singh, appearing for the University, would submit that since the tender itself is the faulty one, it should be set aside and the Court should direct retendering of the security services and housekeeping, etc. This second submission made by Dr. Singh, appearing for the University, would submit that since the tender itself is the faulty one, it should be set aside and the Court should direct retendering of the security services and housekeeping, etc. This second submission made by Dr. Singh has been resisted by both the petitioner as well as respondent No. 3, i.e., the successful bidder in this case and both the learned counsel appearing for the parties would submit that it is not the case of the University that the tender should be set aside and it should be put to re-auction. Admittedly, no such plea has been raised by the University in their counter affidavit regarding the fault committed by the University and seeking a retender of the entire process. So we are not inclined to hold that the process should be put to retendering. 11) The question that remains to be decided in this case whether the petitioner should be awarded the contract by interfering with the decision taken by the petitioner by the University or the respondent No. 3 should be awarded the contract as per the decision taken by the University. It is correct that the Court should be very slow in interfering with the decisions taken by the employer as it is within the realm and gamut of administrative jurisdiction of the University as an employer to decide who should be the best suited person or agency to provide the services required by it. But, another important feature that is very peculiar to this case is that initially when the matter was decided, the University decided that M/s. Commando Industrial Securities is the L-1 bidder and it declared it so. Thereafter, the bid was challenged by the respondent No. 3 and the University took a conscious decision that it has committed an error and the respondent No. 3 should be the lowest bidder and was declared as such. So it cannot be said that the University has not recognized its own fault at the earlier stage. 12) Now coming to the issue of calculation of 5% of management charges. So it cannot be said that the University has not recognized its own fault at the earlier stage. 12) Now coming to the issue of calculation of 5% of management charges. We resorted to the definition of wages as provided under Section 2 Clause (h) of the Minimum Wages Act, 1948 which reads as follows: “(h) "wages" means all remuneration, capable of being expressed in terms of money, which would, if the terms of the contract of employment, express or implied, were fulfilled, be payable to a person employed in respect of his employment or of work done in such employment, [and includes house rent allowance] but does not include- (i) the value of – (a) any house- accommodation, supply of light, water, medical attendance, or (b) any other amenity or any service excluded by general or special order of the appropriate Government; (ii) any contribution paid by the employer to any Pension Fund or Provident Fund or under any scheme of social insurance; (iii) any travelling allowance or the value of any traveling concession; (iv) any sum paid to the person employed to defray special expenses entailed on him by the nature of his employment; or (v) any gratuity payable on discharge;” 13) A plain reading of this provision reveals that wages means all remuneration capable in of expressing in terms of money which is paid to the employee by the employer in respect of his employment or work done in such employment, but it does not include any house accommodation, supply of light, water, medical attendance, any amenities or any services excluded by the general or special order of the appropriate government , any contribution paid by the employee to any pension fund or provident fund or any scheme of social insurance, travelling allowance, etc, any sum paid to the employee to the employee to defray special expenses entailed on him by nature of his employment or any gratuity payable to him on discharge. Now applying this definition to the case in hand, we find that the corrigendum, that has been issued, shows that the minimum wages per day per employee in the unskilled category to be Rs.443/- should not include the contributions under Employees State Insurance Act and Employees Provident Fund Act. Now applying this definition to the case in hand, we find that the corrigendum, that has been issued, shows that the minimum wages per day per employee in the unskilled category to be Rs.443/- should not include the contributions under Employees State Insurance Act and Employees Provident Fund Act. It should not also include 5% and 3% paid to the employees of the basic wage i.e. Rs.334.14 towards uniform and uniform washing as it comes under sub-clause (iv) of Clause (h) of Section 2 of the Minimum Wages Act. However, it leaves the amount of bonus, i.e., 8.33% of Rs.334.14, which comes to Rs.27.83 to the amount to be taken into account for calculating 5% of Management Charges. 14) In that view of the matter, we are of the opinion that the figure that is to be taken to consideration for calculating 5% of management charges comes to Rs.361.97. 5% of this figure is Rs.18.09. Thus, it is clear that the successful tender, i.e., respondent No. 3 which quoted Rs.16.71 is less than 5% of the aforesaid amount, whereas, the rate quoted by the petitioner is Rs.22.15 which is more than the 5% prescribed rate below which the rate cannot be quoted. In that view of the matter, we are in agreement with the case of the petitioner and find merit in the writ application. 15) We may hasten to add here that in spite of all the cautions that has been laid down in the judgments of Hon’ble Supreme Court, we take this view and set aside the decision taken by the employer, i.e., the University, solely on the ground that the total amount that has been taken into consideration for calculating 5% as management charges has been in clear disregard to the definition of wages as discussed above provided in the Minimum wages Act. Moreover, as we have already indicated in the preceding paragraphs that Dr. Ashok Kumar Singh, learned counsel appearing for the University, would submit that the tender itself was erroneous and should be set aside. We are not accepting the second name of submission of Dr. Singh to set aside the entire tender process for retendering on the ground that it is not the case of any of the parties that the tender process should be set aside and the University should be given an opportunity to have a fresh tender. We are not accepting the second name of submission of Dr. Singh to set aside the entire tender process for retendering on the ground that it is not the case of any of the parties that the tender process should be set aside and the University should be given an opportunity to have a fresh tender. 16) In the result, on the ultimate analysis, we allow the writ application and set aside the agreement dated 29.03.2023 (Annexure-5) and letter dated 19.04.2023 (Anenxure-8) and we hereby issue a writ of mandamus directing the University i.e. respondent nos. 1 & 2, to execute an agreement with the petitioner within a period of two weeks, hence. 17) There shall be no orders as to costs. 18) Pending Interlocutory Applications, if any, stand disposed of. 19) Urgent Certified copies as per rules