The petitioner has filed this writ petition seeking the following reliefs: 1. Issue a writ of mandamus or any other appropriate writ, order or direction directing the second respondent to reject the tenders of respondents three to five because of the non compliance of the tender conditions.
2. Issue a writ of mandamus or any other appropriate writ, direction or order by calling for the records leading to Ext.P1 tender notice and cancel the tender proceedings since the procedures adopted by the Corporation for opening the tender was illegal.
3. Declare that the works mentioned in Ext.P1 tender notice can be done only by a qualified experienced A Class contractor.
4. Issue such other writ, orders or directions, which this Honourable Court may deem fit and proper in the interest of justice and circumstances of the case.
2. The petitioner complains about the manner in which the first respondent Corporation, has been considering the tenders for the removal of solid wastes from within its limit for the period ending on 31.3.2015. The petitioner as well as respondents 3 to 5 had submitted tenders pursuant to a notification issued by the first respondent. Ext.P2 contains the tender conditions. According to the petitioner, condition No.7 stipulates that, a person who participates in the tender should furnish an experience certificate from a Government or Quasi Government institution with respect to waste management. However, the fifth respondent has not submitted such an experience certificate. It is the case of the petitioner that, before opening the individual tenders, the first respondent ought to have verified the above aspect. However, without ascertaining whether the fifth respondent had produced the necessary experience certificate, it is alleged that the tenders were opened. Secondly it is contended that, since the work that has been tendered is about Rupees 8 Crores in value, only an A Class Contractor is competent to undertake the same. There were only 4 participants; the petitioner and respondents 3 to 5. The tenders submitted by respondents 3 to 5 have to be rejected for the reason that they are not A Class Contractors. The petitioner is an A Class Contractor and is presently doing the work of removal of solid wastes from the Corporation of Cochin. In view of the above, the petitioner has sought for the issue of appropriate directions for rejection of the tenders submitted by respondents 3 to 5.
3. Adv.V.E.Abdul Gafoor appears for respondents 1 and 2.
According to the counsel, the fifth respondent has submitted an experience certificate along with his tender. Therefore there was no violation of condition No.7 of Ext.P2, as contended by the petitioner. It is further pointed out that, the tender conditions, Ext.P2, do not stipulate that the work could be undertaken only by an A class Contractor. Therefore, there is no restriction as alleged by the petitioner, that only A Class Contractors could participate in the tender proceedings. It is also pointed out that, the first respondent has not taken any decision in the matter yet and therefore, the writ petition is premature.
4. Adv.Murali Purushothaman appears for the fifth respondent. A counter affidavit has been filed producing Ext.R5 (a), an Experience Certificate issued by the Municipal Council, Kalamassery dated 5.1.2013, to substantiate that the fifth respondent had complied with condition No.7 of Ext.P2. According to the counsel for the fifth respondent, in the absence of any stipulation in Ext.P2 restricting the eligibility to participate in the tender to A Class Contractors alone, the contention put forward by the petitioner is without any basis.
5. Adv.T.Madhu appears for the fourth respondent and Adv.Mohammed Shaneem appears for the third respondent. Both counsel submit that, no final decision has been taken by the Corporation in the matter. The writ petition is premature. According to the counsel for the third respondent, it is necessary to issue some directions to the Corporation regarding the manner in which the tenders are to be considered. The counsel for the fifth respondent placed reliance on the decision of the Apex Court in Michigan Rubber (India) Limited Vs. State of Karnataka and others [(2012) 8 SCC 216] to contend that interference under Article 226 of the Constitution of India in tender proceedings or contractual matters is limited to the conditions laid down by the Apex Court in the said decision.
6. Heard. It is not in dispute that, Ext.P2 contains the terms and conditions of the tender. A perusal of Ext.P2 does not show any restriction limiting the eligibility to participate in the tender to A Class Contractors alone. Along with the writ petition, the petitioner has produced Ext.P11 which is stated to be a notice issued by the Superintending Engineer of the first respondent notifying all concerned that, the tender forms should not be issued to persons who are not eligible to receive the same depending on the value of the work tendered. As per Ext.P11, only A Class Contractors could be issued with the tender forms, where the value of work exceeds 2.5 Crores. However, as rightly pointed out by the counsel appearing for respondents 1 and 2 in the present case, the said restriction was not made applicable and that is the reason why, the tender forms were issued to all interested persons who had compiled with the conditions stipulated in Ext.P2 and paid the earnest money deposit stipulated therein, without any restriction on whether the person was an A Class Contractor or not. No such restriction finds a place in Ext.P2 also, as already noticed above. Though it is contended by Sri.P.M.Ziraj who appears for the petitioner that, Ext.P10 Government Order is applicable to the tender proceedings, a perusal thereof shows that, the said Government Order applies only to the Public Works Department. Absolutely no material has been placed before me to justify a conclusion that the same has been made applicable to Corporations and other Local Authorities also. Therefore, the said contention lacks substance.
7. Apart from the above, as rightly pointed out by the counsel for the fifth respondent, the Honourable Supreme Court has in the decision in Michigan Rubber (India) Limited Vs. State of Karnataka and Others (Supra) laid down the conditions that are required to be satisfied before an interference under Article 226 with contractual matters or matters involving tender conditions could be made. I am not satisfied that any interference is called for in the present case. Paragraphs 23 and 24 of the said decision read as follows:
23) From the above decisions, the following principles emerge:
(a) the basic requirement of Article 14 is fairness in action by the State, and non-arbitrariness in essence and substance is the heartbeat of fair play. These actions are amenable to the judicial review only to the extent that the State must act validly for a discernible reason and not whimsically for any ulterior purpose. If the State acts within the bounds of reasonableness, it would be legitimate to take into consideration the national priorities;
(b) fixation of a value of the tender is entirely within the purview of the executive and courts hardly have any role to play in this process except for striking down such action of the executive as is proved to be arbitrary or unreasonable. If the Government acts in conformity with certain healthy standards and norms such as awarding of contracts by inviting tenders, in those circumstances, the interference by Courts is very limited;
(c) In the matter of formulating conditions of a tender document and awarding a contract, greater latitude is required to be conceded to the State authorities unless the action of tendering authority is found to be malicious and a misuse of its statutory powers, interference by Courts is not warranted;
(d) Certain preconditions or qualifications for tenders have to be laid down to ensure that the contractor has the capacity and the resources to successfully execute the work; and
(e) If the State or its instrumentalities act reasonably, fairly and in public interest in awarding contract, here again, interference by Court is very restrictive since no person can claim a fundamental right to carry on business with the Government.
24) Therefore, a Court before interfering in tender or contractual matters, in exercise of power of judicial review, should pose to itself the following questions:
(i) Whether the process adopted or decision made by the authority is malafide or intended to favour someone; or whether the process adopted or decision made is so arbitrary and irrational that the court can say: “the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached”? and
(ii) Whether the public interest is affected?
If the answers to the above questions are in negative, then there should be no interference under Article 226.
8. It is also worth noticing that in the present case, the first respondent has not taken any final decision in the matter. The tenders have been opened and it has been found that the fifth respondent is the lowest tenderer. The question as to whether one of the tenders should be accepted or not is a matter on which the first respondent has not yet taken a final decision. Therefore, I am not satisfied that any prejudice has to be caused to the petitioner, yet. This writ petition is for the above reason, premature.
9. For the above reasons, I do not find any grounds to interfere with the impugned action of the first respondent or to grant any of the reliefs sought for in the writ petition. The writ petition fails and is dismissed.
The counsel for the petitioner makes a final submission that, since Ext.P6 representation is pending before the second respondent, the same may be directed to be considered. The counsel for respondents 1 and 2 do not have any objection, for such a direction to be issued. In view of the above, the second respondent is directed to consider Ext.P6 representation in accordance with law after affording an opportunity of being heard to the petitioner as well as respondents 3 to 5 and to pass appropriate orders thereon, as expeditiously as possible and at any rate before finalising the tender proceedings. It is made clear that, the above direction should not be treated as a direction to negotiate with any of the contractors regarding the rates quoted by them.
Sd/-
K.SURENDRA MOHAN, JUDGE.
rkc.