Heard the learned counsel appearing for the petitioner and the learned counsel appearing for the respondents.
2. The petitioner has stated that he is the proprietor of M/s.Abirami Constructions, Mettur Dam, Salem District. M/s.Abirami Constructions is duly registered and approved by the Tamil Nadu Electricity Board. The petitioner has been doing transport contractor work, under the control of the first respondent Electricity Board. He is owning a truck bearing Registration No.Tn-30-V-2453 and he takes other vehicles on lease, while performing the contract works.
3. The petitioner has further stated that the first respondent Electricity Board had prescribed that the contractor should have not less than one lorry/truck registered in his own name, as the pre-qualification for a contractor to participate in the tenders. The Tamilnadu Electricity Board has been adopting the same guidelines for accepting the tender, for carrying out contract works in the various regions of the State of Tamilnadu.
4. While so, the second respondent had called for sealed tenders from the contractors for transporting PSC poles from Ayyampetaai PSC yards, Thanjavur, to the various places in Trichy region. The pre-condition imposed for contractors to participate in the tender is that they should have atleast two lorries/trucks registered in their name. The said condition is in violation of the Tamil Nadu Electricity Board's memo issued in Memo No.E/CD/SE/D&I/EE1/C/A3/F- Transport/D863/2003, dated 23.9.2003. The said condition has been incorporated in the tender conditions by the second respondent. Since the tender is to be held, on 18.12.2009, the petitioner has preferred the present writ petition before this Court, under
Article 226 of the Constitution of India.
5. The learned counsel for the petitioner has stated that the pre- condition imposed by the Tamil Nadu Electricity Board that the contractors should have not less than two trailors/trucks, registered in their own names to take part in the tender to be held, on 18.12.2009, is arbitrary and illegal. When the first respondent Tamil Nadu Electricity Board has been, all along following the norms that the contractors to be eligible to participate in tenders should have not less than one lorry/struck registered in their own names, it is illegal on the part of the first respondent Electricity Board to impose a new condition that the contractors should have not less than two trailors/trucks registered in their own names to be eligible to participate in the tender to be held, on 18.12.2009. The imposition of a fresh condition is infringing on the fundamental right of the contractor to, effectively, participate in the contract works of the first respondent Electricity Board. As such, the pre-condition incorporated in the tender notification, dated 24.11.2009, issued on behalf of the Tamil Nadu Electricity Board, is contrary to the principles enshrined in
Article 19(1) (g) of the Constitution of India.
6. Mr.M.Suresh Kumar, the learned counsel appearing on behalf of the respondents had submitted that the pre-condition that the contractors should have not less than two trailors/trucks registered in their own names to be eligible to participate in the tender to be held, on 18.12.2009, cannot be said to be arbitrary or illegal. The pre-condition is a reasonable one and therefore, it cannot be said to be arbitrary or illegal. The said condition has been imposed only for the reason that the contractors should be sufficiently equipped to carry out the works allotted to them efficiently and without any disruption.
7. In view of the submissions made by the learned counsels appearing on behalf of the petitioner as well as the respondents and on a perusal of the records available, this Court is of the considered view that the petitioner has not shown sufficient cause or reason to grant the reliefs, as prayed for in the present writ petition. It cannot be said that the condition imposed by the first respondent Tamil Nadu Electricity Board that the contractors, to be eligible to participate in the tender to be held on 18.12.2009, should have not less than two trailors/trucks registered in their own names is onerous, arbitrary and illegal.
8. It is seen that the said condition has been imposed only to improve the efficiency of the contractors in carrying out the contract works allotted to them by the first respondent Electricity Board. Nor can it be said that the condition imposed by the first respondent Electricity Board is impossible of performance. It is a well settled position of law that this Court while exercising its extraordinary jurisdiction, under
Article 226 of the Constitution of India, does not in normal circumstances, interfere in respect of the contractual obligations. The said position has been established by the various decisions of the Courts of law, as found in the following cases 8.1. In TATA CELLULAR Vs. UNION OF INDIA (1994) 6 SCC 651), the Supreme Court had held that the principles of judicial review would apply to the exercise of contractual powers by the Government bodies in order to prevent arbitrariness or favourtism. However, there are inherent limitations in exercise of that power of judicial review. The Government is the guardian of the finances of the State. It is expected to protect the financial interest of the State. The right to refuse lowest or any other tender is always available to the Government. But, the principles laid down in
Article 14 of the Constitution have to be kept in view while accepting or refusing a tender. There can be no question of infringement of
Article 14 if the Government tries to get the best person or the best quotation. The right to choose cannot be considered to be an arbitrary power. Of course, if the said power is exercised for any collateral purpose the excise of that power will be struck down. The judicial quest in administrative matters has been to find the right balance between the administrative discretion to decide matters whether contractual or political in nature or issues of social policy. Thus they are not essentially justiciable and the need to remedy any unfairness. Such an unfairness is set right by judicial review.
The judicial power of review is exercised to rein in any unbridled executive functioning. The restraint has two contemporary manifestations. One is the ambit of judicial intervention; the other covers the scope of the court's ability to quash an administrative decision on its merits. These restraints bear the hallmarks of judicial control over administrative action. Judicial review is concerned with reviewing not the merits of the decision in support of which the application for judicial review is made, but the decision-making process itself. It is thus different from an appeal. When hearing an appeal, the Court is concerned with the merits of the decision under appeal. Since the power of judicial review is not an appeal from the decision, the Court cannot substitute its own decision. Apart from the fact that the Court is hardly equipped to do so, it would not be desirable either. Where the selection or rejection is arbitrary, certainly the Court would interfere. It is not the function of a judge to act as a superboard, or with the zeal of a pedantic schoolmaster substituting its judgment for that of the administrator. 8.2. In GLOBAL ENERGY LTD., Vs. ADANI EXPORTS LTD. (2005) 4 SCC 435), the Supreme Court had held that the principle is well settled that the terms of the invitation to tender are not open to judicial scrutiny and the Courts cannot whittle down the terms of the tender as they are in the realm of contract unless they are wholly arbitrary, discriminatory or actuated by malice. 8.3. In SWAMIDHAS Vs. THE CHIEF ENGINEER, NATIONAL HIGHWAYS (2001 (4) CTC 257), this Court had held that the authorities cannot and need not wait for the contractors like appellants to acquire the machinery by way of lease from other owners. In fact, that is a contingent situation. Even after the contract is struck, there is no guarantee that machinery will be provided and if provided, as to the quality and working condition of the machinery. The public work cannot wait, risking such contingencies. As such, the authorities have rightly felt that there should be an imposition of ownership of the machinery, as if such machinery is at the ready disposal of such successful contractor/s they can readily start the work and successfully complete the same within the time schedule. What is more, in view of numerous such contractors owning machinery, by no stretch of imagination can it be said that the imposition of condition No.5 is a tailor-made to suit one or a few individuals. In the circumstances, we find that the imposition of condition No.5 has got a nexus with the object to be achieved, and that it is neither arbitrary nor unreasonable and there is no infringement of any Fundamental Right of the appellants. 8.4. In J.V.GOKAL AND COMPANY, MUMBAI Vs. STATE OF TAMIL NADU (2005) 1 M.L.J.483), this Court had held that the court must exercise judicial restraint in the matter of tenders, as they are basically administrative in nature. 8.5. In SRI AMMAN ASSOCIATES Vs. STATE OF TAMIL NADU (2005 (4) CTC 399), this Court had held that the requirement of 40% previous experience and the requirement of ownership of the machineries are insisted upon to ensure quick and efficient execution of the work. These are matters which are within the exclusive discretion of the authorities and as long as there is no discriminatory or arbitrary exercise of the power, this Court cannot interfere. The object of requiring the contractor to own machineries by themselves is accentuated by the necessity to ensure prompt execution of the work. 8.6. This Court, in its order, dated 14.9.2009, made in W.P.No.22828 of 2008 (E.GUNASEKARAN Vs. THE MANAGING DIRECTOR, PONDICHERRY CO-OPERATIVE MILK PRODUCERS' UNION LTD., KURUMAMPETTAI, PUDUCHERY 605 009), had reiterated the settled position of law that this court should not interfere with the terms of the tender notice, unless it is shown as arbitrary, discriminatory or tainted with mala fides.
8.7. In R.KUMAR Vs. C.E., METTUR THERMAL POWER STATION (2008) 3 MLJ 173), this Court had held that the terms of the invitation to tender are not open to judicial scrutiny, the same being the realm of contract. In the matter of policy decisions or exercise of proper discretion by the Government so long as the infringement of the fundamental right is not shown, the Courts will have no occasion to interfere and the Court should not substitute its own judgment for the Judgment of the executive.
8.8. In DIRECTORATE OF EDUCATION Vs. EDUCOMP DATAMATICS LTD (2004) 4 SCC 19), the Supreme Court had held that it was for the authority to set the terms of the tender. The courts would not interfere with the terms of the tender notice unless it was shown to be either arbitrary or discriminatory or actuated by malice. While exercising the power of judicial review of the terms of the tender notice, the Court cannot say that the terms of the earlier tender notice would serve the purpose sought to be achieved better than the terms of the tender notice under consideration and order change in them, unless it is of the opinion that the terms were either arbitrary or discriminatory or actuated by malice. The terms of the invitation to tender are not open to the judicial scrutiny, the same being in the realm of contract. The Government must have a free hand in setting the terms of the tender. The courts can scrutinise the award of the contracts by the Government or its agencies in exercise of their powers of judicial review to prevent arbitrariness or favouritism.
9. Further, this Court in its order, dated ____, made in W.P.(MD) Nos.11502 of 2009 (batch) has also held that the imposition of such conditions, as part of the terms and conditions of the agreement or contract cannot be held to be arbitrary and void. In such view of the matter, the writ petition is liable to be dismissed. Accordingly, it is dismissed. No costs.
csh To
1.The Chairman, Tamilnadu Electricity Board, 800, Annasalai, Chennai-600 002.
2.The Chief Engineer, Distribution/Trichy Engineer, Tamilnadu Electricity Boad, Thennur, Trichy-620 017.