Cobra Industrial Security Force (I) Ltd. , through its Director Raju Pandey, Son of Sri Janardan Pandey v. Nilamber-Pitamber University, through its Vice Chancellor
2025-08-13
RAJESH SHANKAR, TARLOK SINGH CHAUHAN
body2025
DigiLaw.ai
JUDGMENT : Rajesh Shankar, J. 1. The present writ petition has been preferred for quashing and setting aside Tender No. NPU/CCDC/06/2025 dated 01.04.2025 (hereinafter referred as the second tender) issued by the Registrar, Nilamber-Pitamber University, Medininagar Palamu (respondent no. 2) inviting bid for "Supply of Manpower at Nilamber-Pitamber University Headquarters, Medininagar, Palamu, Jharkhand and all its Constituent Colleges". Further prayer has been made for issuance of direction upon the respondents to immediately and forthwith issue work order to the petitioner with respect to Tender No. NPU/CCDC/04/2024 dated 24.08.2024 (hereinafter referred as the first tender). 2. During pendency of the writ petition, the petitioner, by filing an I.A No. 8426 of 2025, sought to quash the letter as contained in Memo No. NPU/R/148/25 dated 09.04.2025 issued by the respondent no. 2 whereby the first tender was cancelled. It is also prayed for quashing and setting aside the letter as contained in Memo No. NPU/R/148A/2025 dated 09.04.2025 issued by the respondent no. 2 whereby the Agreement dated 25.01.2025 executed between the petitioner and the respondent no. 2 with respect to the first tender was cancelled. 3. Learned counsel for the petitioner submits that the respondent no. 2 floated the first tender in which the petitioner was declared successful bidder. The petitioner furnished the Earnest Money Deposit (EMD) of Rs. 20,00,000/- as per the terms of the first tender vide Demand Draft No. 161226 dated 13.01.2025 and thereafter Agreement dated 25.01.2025 was executed between the respondent no.2 and the petitioner, which was valid for one year i.e. from 25.01.2025 to 24.01.2026 on the terms and conditions mentioned therein. 4. It is also submitted that despite several requests made by the petitioner, the respondent no. 2 did not issue the required work order and thereafter the petitioner vide separate e-mails dated 25.03.2025 requested the respondent nos.1 to 3 to issue work order for the first tender. 5. It is further submitted that the respondent no. 2, instead of issuing the work order to the petitioner for the first tender, issued second tender for the same work which is illegal, arbitrary, mala fide and against the express provisions of contract and therefore the same is liable to be set aside. 6.
5. It is further submitted that the respondent no. 2, instead of issuing the work order to the petitioner for the first tender, issued second tender for the same work which is illegal, arbitrary, mala fide and against the express provisions of contract and therefore the same is liable to be set aside. 6. It is also submitted that the second tender has been issued without giving any information/notice to the petitioner much less terminating/cancelling the Agreement dated 25.01.2025 as also without refunding the amount of EMD furnished by the petitioner with respect to the first tender. 7. It is argued that Clause-XVIII of the Agreement dated 25.01.2025 provides that in case of violation of any condition mentioned in the said agreement, the respondents may terminate the contract by issuing 30 days’ prior notice to the petitioner. However, admittedly no notice with regard to the same has been issued to the petitioner. 8. It is further contended that the act of non-issuance of the required work order by the respondent no. 2 with respect to the first tender and issuance of second tender for the same work is only to prevent the petitioner from getting the allotment of the work in question and to give it to some other bidder. 9. It is further submitted that though the petitioner was earlier blacklisted by Bihar Education Project Council vide letter no. 7903 dated 27.12.2023, however the order of blacklisting was withdrawn by the said Department vide subsequent Office Order dated 08.01.2024. 10. It is urged that the illegality and arbitrariness on the part of the respondent no. 2 would be evident from the fact that the agreement dated 25.01.2025 was cancelled subsequent to floating of the second tender. 11. Per contra, learned counsel for the respondents submits that as per Clause-12 of the terms and conditions of the first tender, the absolute right was reserved with the respondents to accept or reject any or all the tenders on whole or in part without assigning any reason thereof. Clause-13 of the terms and conditions relating to first tender provided that there should be no case pending with the police or court against the proprietor/firm/partner or the company (bidder) and affidavit in this regard was required to be provided by the bidders.
Clause-13 of the terms and conditions relating to first tender provided that there should be no case pending with the police or court against the proprietor/firm/partner or the company (bidder) and affidavit in this regard was required to be provided by the bidders. However, no affidavit in the light of instruction mentioned in clause no.13 was submitted by the petitioner to the office of the respondents. It is further submitted that the first tender was cancelled due to some unavoidable circumstances and the petitioner was informed to take back the given EMD amount. 12. It is also argued that the agreement dated 25.01.2025 executed between the petitioner and the respondent no.2 with respect to the first tender was cancelled vide Memo No. NPU/R/148A/2025 dated 09.04.2025 invoking Clause 12 of the terms and condition of the first tender. 13. Heard the learned counsel for the parties and perused the materials placed on record. 14. Thrust of the argument of learned counsel for the petitioner is that the petitioner was the successful bidder in the first tender and the agreement for the said work was executed between the petitioner and the respondent no.2 on 25.01.2025 after deposit of the EMD amounting to Rs.20,00,000/-, however instead of issuing the work order for the first tender, the second tender was issued by the respondent no.2 without cancelling the agreement dated 25.01.2025. It is further contended that subsequent to issuance of the second tender, the respondent no. 2 in order to justify his action, cancelled the agreement dated 25.01.2025 on 25.03.2025 mentioning that the petitioner was blacklisted by the Bihar Education Project Council, Patna vide its Office Order as contained in memo no. 7903 dated 27.12.2023, whereas, the actual fact was that the said order of blacklisting was already withdrawn by the Bihar Education Project Council vide office order as contained in memo no.142 dated 08.01.2024 and the petitioner was not even provided an opportunity to explain the said fact. 15. It is an admitted fact that the petitioner was the successful in the first tender pursuant to which it deposited EMD of Rs.20,00,000/- and subsequently agreement with respect to the said tender was also executed between the petitioner and the respondent no. 2 on 25.01.2025. However, the second tender was issued on 01.04.2025 without any prior notice to the petitioner. 16.
2 on 25.01.2025. However, the second tender was issued on 01.04.2025 without any prior notice to the petitioner. 16. So far as the cancellation of first tender is concerned, it has been stated by the respondents in the counter affidavit that vide letter as contained in memo No.NPU/R/148/25 dated 09.04.2025, the petitioner was informed about cancellation of same. The petitioner was also informed vide said letter that the EMD deposited by it would be returned within three working days. However, by way of supplementary counter affidavit dated 01.08.2025, the respondents have brought on record another letter as contained in Memo No. NPU/R/102A/25 dated 25.03.2025, mentioning inter alia that the first tender was cancelled by the said letter. 17. The letters as contained in memo No. NPU/R/148/25 dated 09.04.2025 and memo No. NPU/R/102A/25 dated 25.03.2025 are contradictory to each other as it has been stated in both the letters that the first tender is being cancelled with immediate effect which creates serious doubt on the authenticity of the letter dated 25.03.2025. Thus, we do not find any substance in the argument of the learned counsel for the respondents that the first tender was cancelled prior to issuance of the second tender. 18. Moreover, in both the letters dated 25.03.2025 and 09.04.2025, the reason for cancellation of the first tender has been mentioned as “due to some unavoidable circumstances”. Thus, no specific reason has been provided in the said letters. In the supplementary counter affidavit, the respondents have taken the stand that the first tender was cancelled taking into consideration the blacklisting of the petitioner by the Bihar Education Project Council, Patna made vide Office Order No. 7903 dated 27.12.2023. 19. In the case of Mohinder Singh Gill & Another Vs. Chief Election Commissioner and New Delhi & Others, reported in (1978) 1 SCC 405 , the Constitution Bench of the Hon’ble Supreme Court has held as under:- “ 8. The second equally relevant matter is that when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of affidavit or otherwise. Otherwise, an order bad in the beginning may, by the time it comes to court on account of a challenge, get validated by additional grounds later brought out.
Otherwise, an order bad in the beginning may, by the time it comes to court on account of a challenge, get validated by additional grounds later brought out. We may here draw attention to the observations of Bose, J. in [Commr. of Police, Bombay v. Gordhandas Bhanji, 1951 SCC 1088]: “Public orders, publicly made, in exercise of a statutory authority cannot be construed in the light of explanations subsequently given by the officer making the order of what he meant, or of what was in his mind, or what he intended to do. Public orders made by public authorities are meant to have public effect and are intended to affect the actings and conduct of those to whom they are addressed and must be construed objectively with reference to the language used in the order itself.” Orders are not like old wine becoming better as they grow older.” 20. Thus, the reason assigned in an order cannot be supplemented by filing a counter affidavit, rather the validity of the order must be judged by the reasons so mentioned in the order itself. An order which is bad in the beginning, cannot be validated by any additional ground brought out later. 21. The reason for cancellation of tender assigned in the letter dated 25.03.2025 and the letter dated 09.04.2025 is vague. There can be no gainsaying that the tender inviting authority has every right to cancel any tender in the public interest, however the said power should not be exercised arbitrarily and unreasonably on vague reasons. 22. Another aspect in the matter is that the second tender was issued by the respondent no. 2 without cancelling the agreement dated 25.01.2025 executed with respect to the first tender. The agreement dated 25.01.2025 was cancelled vide letter dated 09.04.2025 invoking Clause 12 of the terms and conditions pertaining to the first tender that too without providing any opportunity of hearing to the petitioner. On perusal of the said Clause, it appears that the respondents had absolute right to accept or reject any or all the tenders on whole or in part without assigning any reason thereof. 23. In the case of Union of India & Others Vs.
On perusal of the said Clause, it appears that the respondents had absolute right to accept or reject any or all the tenders on whole or in part without assigning any reason thereof. 23. In the case of Union of India & Others Vs. Dinesh Engineering Corporation and Another, reported in (2001) 8 SCC 491 , claim of the Railway was that under clause 16 of the framed Guidelines, it was entitled to reject any tender offer without assigning any reason and it had also the power to accept or not to accept the lowest offer. In the said case, Their Lordships held that the said power should have been exercised within the realm of the object for which the said clause was incorporated. By the said clause, the Railway was not provided an arbitrary power to reject the bid offered by a party merely because it had that power. Such power could have been exercised on the existence of certain conditions which in the opinion of the Railway was not in its interest. It was further held that the public authorities even in contractual matters should not have unfettered discretion and in contracts having commercial element, though some extra discretion is to be conceded in such authorities, they are bound to follow the norms recognized by courts while dealing with public property. This requirement is necessary to avoid unreasonable and arbitrary decisions being taken by public authorities whose actions are amenable to judicial review. Therefore, merely because the authorities have certain elbow room available for use of discretion in accepting the offers in contracts, the same will have to be done within the four corners of the requirements of law, especially Article 14 of the Constitution. 24. We are of the view that Clause 12 of the terms and conditions does not mean that the respondents should not have any valid reason to justify their conduct. The respondents are public authorities and accepting and rejecting a tender would create burden on the public exchequer and as such, they are bound to act fairly and not arbitrarily. The said power could not have been invoked after accepting the bid of the petitioner and executing agreement with it. Once the agreement for the first tender was executed between the petitioner and respondent no. 2, the same could not have been cancelled without providing opportunity of hearing to the petitioner. 25.
The said power could not have been invoked after accepting the bid of the petitioner and executing agreement with it. Once the agreement for the first tender was executed between the petitioner and respondent no. 2, the same could not have been cancelled without providing opportunity of hearing to the petitioner. 25. Moreover, it transpires from the record that the order of blacklisting was already withdrawn by the Bihar Education Project Council vide office order as contained in memo no. 142 dated 08.01.2024 much before passing of the order of cancellation of the first tender. 26. For the reasons as aforesaid, the second tender being Tender No. NPU/CCDC/06/2025 dated 01.04.2025 is hereby quashed. The letters as contained in Memo No. NPU/R/148A/2025 dated 09.04.2025 as well as Memo No. NPU/R/102A/25 dated 25.03.2025 issued by the respondent no. 2 are also quashed. 27. The respondent no. 2 is directed to forthwith execute fresh agreement with the petitioner with respect to the first tender, which shall be valid for a minimum period of one year from the date of execution of the same and accordingly issue work order for the said work to the petitioner. 28. The writ petition is, accordingly, allowed. 29. Pending interlocutory application(s), if any, stands disposed of.