Hon'ble Ravi Nath Tilhari,J.
Heard Shri Jaindeep Narain Mathur, learned Senior Counsel assisted by Shri Varad Nath and Shri Gantavya Chandra, Advocates for petitioner and Shri Asit Chaturvedi, learned Senior Counsel assisted by Shri Shiv P. Shukla, Advocate for opposite party.
By means of this writ petition a challenge has been made to the tender document a copy of which is annexed as Annexure no. 43 to the writ petition and tender process initiated on 18.02.2021 by opposite party no. 1.
The petitioner no. 1, which is a company based in India, has a subsidiary, namely, Tooltech Europe (Tooltech Finland) which in turn had a collaboration with one VTT Technical Research Center of Finland (VTT) an entity allegedly owned by the Government of Finland. It claims that with assistance of the subsidiary and the collaborator, interaction and consultation took place with opposite party no. 1, Research Designs and Standards Organization (R.D.S.O.), for developing a customized product having technology being ''Terrain Imaging for locomotive drivers - Infra-red, Enhanced Optical and Radar finder Assisted' (TRI-NETRA), for use on locomotives. It is claimed by petitioner that several trials were also conducted with the permission of opposite party no. 1 in this regard and they were successful.
It is said that after such deliberations and trials, which not only involved petitioner no. 1, but, other companies based in India as also outside it, a global tender was floated inviting tenders for ''proof of concept' for trial of the required mechanism/ system. This tender was floated on 02.03.2020 and the tender document is annexed along with the writ petition. The eligibility condition with regard to the said tender was that tenderers must have supplied, installed and commissioned, 5 sets of devices having capability of display and detection range of 1.0 kilometers in day and night conditions in last five years and in financial year 2019-2020, to customers operating Aircraft/ Helicopters/ Rolling stocks/ Ships/ Autonomous vehicles / remote sensing applications. This condition was modified in the pre-bid meeting held on 15.10.2019 and an alternative eligibility criteria/condition was included by which tenderers who had tried out the system having functionality of Infra-red imaging or range detection up to 1 kilometer on a train in dynamic condition in one of the railway systems of the world was also made eligible for participation.
Case of the petitioner is that it having tried out the system as referred in the alternative eligibility condition of the said tender with the aid and assistance of its subsidiary Tooltech Europe/ Tooltech Finland, which in turn was in collaboration with one VTT Finland as referred above, it became eligible for submitting the tenders as per the said modified eligibility condition even though it did not fulfill the earlier condition. The modification, according to it, was made, considering the expansive deliberations and interactions undertaken by the opposite party no. 1 with the petitioner and other similarly situated companies.
However, this tender notice was withdrawn in October, 2020. Thereafter, a fresh tender notice was issued on 18.02.2021 which has been impugned herein.
In the impugned tender process the alternative or modified eligibility condition, which was inserted subsequently in the earlier tender, has not been included.
After issuance of the fresh tender notice the petitioner raised certain queries to the opposite party no. 2 vide Annexure No. 45 regarding eligibility conditions of tender in the pre-bid meeting held on 03.03.2021 which were answered, as is evident from Annexure No. 45 at Page 657 and onwards. As regards mentioning of the alternative eligibility condition in the earlier tender document and its exclusion in the subsequent tender notice, which is impugned herein, the response of the opposite party no. 1 to query of the petitioner no. 1 was that, mere mentioning of the word ''tried out' does not necessarily mean the success of the trial and therefore, in order to introduce an element of objectivity, this word was removed and objective and verifiable parameters were introduced. The response further mentions about the criterion to be based on successful achievement of some physical parameter. Eligibility criteria should be clear, definite and to be adjudged on the success of trial. It further mentions that no known imaging/Range Detection System had been successfully tried out or proven on Indian Railways or in any other Railway System, to the best of information available with RDSO, so, hardly any firm was likely to meet the criteria of successful trial. On the contrary, such type of clause could cause confusion during evaluation of credentials. Further reasons in support of exclusion of the ''alternative eligibility condition' mentioned in the earlier tender, have been given in the said response.
In response to query no. 17 at Page 660 of the writ petition the opposite party no. 1 has informed the petitioner no. 1 that with regard to ''make in India policy', extant instructions of Government of India were being followed. The petitioner was asked to refer to Clause 1401 of instructions to tenderers and general conditions of tender (Bid document, Part-I Section- I) attached with the tender document.
In response to query no. 18 it was mentioned that all instructions related to ''make in India Policy' as notified by the Govt. of India had been incorporated in Clause 1401 of instructions to tenderers and general conditions of tender referred above.
The petitioner, thereafter, represented at least thrice to opposite party no. 1 raising queries wherein detailed responses have been given which are on record as Annexure No. 48 and 50.
In response to the petitioner no. 1's letter dated 15.03.2021 contained in Annexure No. 48 it has, inter alia, been mentioned that discharge of tender in past has no bearing with the development of known technology. Minor revision in specifications has been done for the reason mentioned in the response. In response to the petitioner's assertion that every time the opposite party meets the specifications determined, there is another set of specifications, it has inter alia been mentioned that this is a new technology being developed for the first time in Indian Railways, therefore, naturally, this would require lot of iterations that is why this is a proof of concept trial and based on its outcome, specifications will be finalized subsequently, which will, thereafter, be the basis for processing goods.
In response to query no. 9 it has been informed that 5 sets of TRI-NETRA for carrying out ''proof of concept' trial are being procured in the current tender. Based on its outcome technical specifications shall be finalized for further procurement. For measurement of performance, field trial and functional trial schemes had been very much included in the revised specification.
In response to query number 10 by petitioner, it has been informed that Fog Vision System (FVS) and Tri-Netra are two different projects and in response to query no. 12 it has been said that ''make in India' is at the core of this tender.
With reference to the assertion of the petitioner at serial no. 15 of the said response that it is the railway ministry that organized the presentation at Niti Aayog, which RDSO itself has published in its news magazine in 2017, the response has been that referred documents only mentions about demonstration trial. There is no documentary evidence available with the RDSO that verify the success of the above field trials.
Thus, detailed responses have been given by the opposite party no. 1 to the queries and representations of the petitioner no. 1 in this regard.
We find that prior to filing of this writ petition on 01.07.2021, the petitioner has submitted its tender in pursuance to the impugned tender notice on 29.06.2021, a fact which is mentioned by it in para 2.52 of the writ petition, albeit, with the caveat that it is certain that its bid will be unfairly rejected and that it has submitted the tender without prejudice to its rights to challenge the same.
It is an undisputed fact that the tender in question is not for procurement of goods or supplies etc. but it is a tender for ''proof of concept' for trial. Based on this exercise/ outcome, technical specification shall be finalized for further procurement. It is not a Global tender but one which confines participation therein to local suppliers.
The difficulty which the petitioner faces in respect of the impugned tender is two fold, firstly, participation therein has been confined only to ''local suppliers'. The ''non local suppliers' are not eligible. The earlier tender was a Global tender in which non local suppliers could also participate. Even in the earlier tender petitioner did not fulfill the initial eligibility condition requiring that the tenderer should have supplied, installed and commissioned 5 sets of devices having capability of display and detection range of 1.0 kilometer in day and nigh condition in last five years and in financial year 2019-2020 to customers operating Aircraft/ Helicopters/ Rolling stocks etc. It is only because of the alternative eligibility criteria/ condition inserted subsequently, which permitted tenderers who had tried out the system on a train in dynamic condition in one of the railway systems of the world, to participate, that, the petitioner become eligible, as claimed, in view of the alleged trials conducted by it, that too, with the aid and assistance of non local suppliers, Tooltech Europe (Finland) and its collaborator VTT and not independent of them. Now, these non local suppliers not being eligible to participate in the fresh tender, which is confined to ''local suppliers' in view of make in India Policy of the Government, the petitioner, though it is based in India, is not eligible on account of the eligibility condition for the fresh tender which is somewhat analogous to the initial eligibility condition (unmodified) of the earlier Global tender. This condition requires that the tenderer himself or OEM/ System Integrator (in case tenderer authorized by OEM/ System Integrator quoting the bid on behalf of OEM/ System Integrator) must have supplied and commissioned 05 sets of devices for application in Aircrafts/ Helicopters/ Rolling stocks/ Ships/ Automobiles/ Aerial Remote sensing, during period beginning from 2015-16 and up to tender opening date having following capability - "imaging of object at a distance of minimum 1.0 kilometer in day or night conditions during normal or foggy weather"- OR - "Detection and ranging of object at a distance of minimum 1.0 kilometer in day or night conditions during normal or foggy weather." Admittedly, the petitioner no. 1 of which the petitioner no. 2 claims to be the share holder, does not fulfill this condition. There is no alternative eligibility condition in the fresh tender as existed in the earlier tender. The reason for this has been given by opposite party no. 1 in response to queries/ representations of petitioner, as already discussed earlier.
The contention of Shri Mathur, learned Senior Counsel appearing for the petitioners was that having put in so much with the aid and assistance of its subsidiary company and its collaborator, both of whom are based outside India, and having interacted and deliberated with the opposite party no. 1 since 2009 in developing a system which would be best suited for the India Railways and having had the opportunity to participate in the global tender which was issued earlier on account of alternative eligibility condition, which was reasonable enough, now, for the opposite party no. 1 to cancel the same and then to issue a fresh tender notice deleting the said alternative eligibility condition and confining participation in the fresh tender only to local suppliers, apart from being violative of Para 3 of the order dated 16.09.2020 issued under Rule 153(iii) of the General Financial Rules, 2017, it is even otherwise highly inequitable. The petitioner had invested a lot since 2009 in developing the system required by the Indian Railways and now finds itself left high and dry. The condition of excluding non local suppliers and deleting the alternative condition is unreasonable, as, it is not in the best interest of the Railways nor in the interest of public safety on Rails. He submitted that after having put in so much for developing such a system since 2009, that too, in serious interaction and consultation with the opposite party no. 1 and the Indian Railways, the petitioner had a legitimate expectation for being allowed to participate in such tender which has been violated. He also alleged violation of Article 14 of the Constitution of India. He submitted that the conditions of the fresh tender are such that they are designed to oust the petitioner from zone of consideration and therefore, are tailor made to suit others.
On the other hand Shri Asit Chaturvedi, learned counsel appearing for the opposite parties submitted that tender is only for ''proof of concept' of trial and it is not a tender for procuring goods and supply etc., therefore, the order dated 16.09.2020 issued under Rules, 2017 do not stricto sensuo apply, but, even otherwise, he relied upon Para 3-B of the said order to belie the contentions of learned counsel for petitioners. He took us through the representations/ queries of the petitioner and the response of the opposite party no. 1 in this regard, as already referred by us, earlier. He submitted that none of the rights of the petitioner are being violated. The opposite party no. 1 is entitled to determine the conditions of tender and none of the conditions are unreasonable or violative of Article 14 of the Constitution of India. The tender document is in tune with ''make in India policy' of the Government of India and there is no cause for interference in the matter under Article 226 of the Constitution of India.
We asked learned Senior Counsel for petitioners as to whether at any stage the opposite parties no. 1 and 2 made any promise to the petitioner that it would either have a right of participation in the tender to be invited for the purposes of ''proof of concept' of trial or that their tender would be accepted, at a later stage, for procurement of goods etc., learned Senior Counsel fairly submitted that it is not so and at no stage was any such promise made.
We also asked learned Senior Counsel for petitioner as to how far the petitioner can succeed on the plea of legitimate expectation in a matter of contract/tender, learned Senior Counsel submitted that it could at best entitle the petitioner to opportunity of hearing. We are of the opinion that considering the queries made by the petitioner and the response of the opposite party no. 1, as noticed earlier, this aspect stands satisfied, substantially, assuming that it is of any relevance with regard to the subject matter in issue.
We also asked Shri Mathur, learned Senior Counsel as to whether the Rules of 2017 have been made under any statute, to which he responded that they appeared to be in the form of executive orders but were nevertheless binding.
It is not in dispute that the petitioner no. 1 is based in India, therefore, exclusion of ''non local suppliers' by itself does not prejudice the petitioner per se. The difficulty of the petitioner is that it was never eligible for such tender on its own even in respect the first tender. It was always dependent upon ''Tooltech Finland' and VTT Finland, who are ''non local suppliers', being based outside India. Petitioner no. 1, is based in India, but, bereft of assistance of its subsidiary, the Tooltech Finland and its collaborator VTT Finland and in the absence of the alternative eligibility condition which was prescribed in the earlier tender document, it does not satisfy the eligibility condition for the impugned tender process requiring that the tenderer must have supplied and commissioned 5 sets of devices for application in Aircraft/Helicopters etc. during period beginning from 2015-16 and up to tender opening dates, having the capability as already mentioned earlier. Thus, non participation of the petitioner is on account of non fulfillment of this eligibility condition.
The tender document in so far as it confines participation only of ''local suppliers', can not by itself be said to be unreasonable and arbitrary nor hit by Article 14, as, this has been done in furtherance of Government of India's ''make in India policy' under which preference has to be given to local suppliers.
The petitioner does not have any indefeasible right to do business with the Government or its instrumentality as has been held by the Supreme Court of India in the case of Michigan Rubber (India) Ltd. Vs. State of Karnataka and Ors. reported in (2012) 8 SCC 216. It can not compel the opposite party no. 1 to include a particular eligibility condition as was included in the earlier tender document, as, this is something which is in the domain of opposite party no. 1 which is best placed to assess its own requirements and needs and to determine tender conditions accordingly. It can not compel the opposite party no. 1 to allow non local suppliers to participate in the tender. The opposite party no. 1 has given cogent and reasonable answers to the queries of petitioner in the responses already referred earlier. Based on such responses it can not be said that the eligibility condition for the fresh tender is unreasonable or that it could not have been included in the tender document or that it was tailor made to favour somebody nor that the exclusion of the alternative eligibility condition of the earlier tender is unjustified. What is in the best interest of Railways and public safety, is a matter to be determined by experts of opposite parties no. 1 and 2 and the Courts are not experts in this area. It is well settled that in matters of contract and tenders certain free play in the joints is permissible. In the facts of the case, it can not be said that action of the tendering Authority is malicious or a misuse of its statutory powers or that it is unreasonable and not in public interest. The opposite party no. 1 and 2 are best suited to assess public interest in this regard.
We have already mentioned that the tender notice is for ''proof of concept' of trial and not for procurement of goods and supplies to which the order dated 16.09.2020 issued under the Rules of 2017 apply. Even otherwise, considering the ''make in India policy' of the Government of India which is designed to promote local suppliers, manufacturers and producers based in India and the response of the opposite party no. 1 vide Annexure No. 45, 48 and 50 that the tender has been issued in terms of the latest Railway Board instructions, we do not find it a fit case for interference under Article 226 of the Constitution of India, as, admittedly, the petitioner does not fulfill the requisite eligibility condition, though, it is based in India, and we do not find the eligibility conditions determined by the opposite party no. 1 to be in any manner unreasonable arbitrary or against public interest. We accordingly dismiss this writ petition.
Order Date :- 27.07.2021 R.K.P.