SRI. G. SHANKAR vs. KRISHNA BHAGYA JALA NIGAM LIMITED

technical bid of the petitioner uploaded on 28.01.2016 as also the communication dated 14.01.2016 at Annexures-R and X respectively. The said application for amendment has not been considered and disposed, as such it is pending on file. Since the contentions urged therein have also been noticed by this Court at the time of hearing, for the purpose of records, the application in IA No.2/2016 is allowed subject to the need arising for this Court to advert to the contentions therein for the purpose of its decision, but the averments therein are treated as a part of the pleading.

reckoned back from 2014-15 (work done during 2010-11 to 2014-15 only will be considered) duly updating the financial turnover at 10% per annum. Audited balance sheet certified by a practicing Chartered Accountant along with copy of Income Tax returns filed for the two years indicated above shall be furnished. c) The bidder should have executed a minimum quantity of 51473 Cum Concrete of the work (usually 80% of the peak annual rate of construction [i.e. (0.80 x 96512/18) x 12] in any one financial year, during the last five financial years reckoned back from 2014-15. The certificate should be issued by an officer not below the rank of Executive Engineer of the concerned Division/Equivalent office and countersigned by the SE of the concerned Circle/next higher officer.”

assessed at Rs.88.66 crores which is less than 50% of the amount put to tender and as such the petitioner is declared as not technically qualified. The petitioner making out a grievance that respondents No.1 and 2 have wrongly analysed the work certificate and have committed an error in providing the weightage is before this Court contending that if a proper analysis of the document submitted by the petitioner is made, the work completed in the last five financial years reckoned back from 2014-15 would be more than 50%; even otherwise, if the weightage is assigned correctly, the petitioner would qualify. Further contentions are also urged on behalf of the petitioner with regard to the inappropriate analysis of the document submitted by respondent No.3. According to the petitioner, though the third respondent does not satisfy the requirement, the respondents No.1 and 2 have erroneously come to the conclusion that the respondent No.3 is qualified in the technical evaluation.

also referred and the reason for which the petitioner was found not qualified in the technical evaluation is also sought to be justified.

M/s. Kamdhenu Cattle Feed Industries [(1993) 1 SCC 71]; in the case of M/s. Recondo Ltd. -vs- Board of Trustees (ILR 1985 Karn. 3794) to contend that the tender process should indicate fairness. A cumulative perusal of all the above noticed decisions will indicate that the party floating the tender, more particularly Government bodies should adhere to the Rules and instructions governing the tender process scrupulously so as to avoid discrimination, arbitrariness and favouritism. The bidders participating in the tender process have right to equality and fair treatment. The contractual transactions of the State or its instrumentalities should indicate non-arbitrariness, fairness in action and due consideration of legitimate expectation of an affected party which are the essential requisites for a valid State action. The State or its instrumentalities are bound to act in the matter of disposal of contracts in accordance with the principles embodied in Article 14 of the Constitution and is required to follow the procedure which is fair, reasonable and is free from taint of unreasonableness. If

the consideration is not according to the standards set out, the tenderer is entitled to question the validity and legality of the proceeding relating to disposal of the contract.

permissible for this Court to exercise its discretion at a stage when the technical evaluation alone is completed and the tender process as such is not completed through an order of the Tender Accepting Authority by award of contract, before which there is room for other contingencies to occur. Hence, the said aspect will have to be adverted to at the outset so as to determine the scope and extent of interference possible by this Court with regard to the tender process. Depending on the conclusion reached on that aspect, the need or otherwise to advert to the specifics of the contention relating to the merits of the technical evaluation as made will arise.

that the appeal remedy is to be availed wherever available though it does not take away the power of this Court to exercise its discretion and entertain a writ petition under Article 226 of the Constitution in appropriate cases. In that view, specific reference to the orders cited is not made, as otherwise it would unnecessarily overburden this order without serving any useful purpose. However, the decision of this Court in the case of TATA Projects Ltd. -vs- Karnataka Power Corporation Ltd. and others (W.P.No.2535/2013 c/w W.P. No. 505/2013-GM-TEN dated 26.02.2013) which is very vehemently relied on by the learned senior counsel for the respondents will require in-depth consideration, since in the said case not only the contention relating to the existence of the appeal remedy, but the nature of consideration permissible prior to the completion of the tender process is also adverted to in the light of the power available to this Court under Article 226 of the Constitution qua the restraint to be exercised in certain circumstances was adverted to in detail.

ultimately arrived at its conclusion. As such it would be appropriate to take note of the decision in TATA Projects Ltd. case itself in detail as it is an outcome of the analysis of the entire gambit of the precedents on this aspect and arrive at a conclusion herein. In that case also, the grievance was against the tender evaluation process, before the work had been awarded to any one of the tenderers therein. The respondents therein also had in that light raised issues with regard to the maintainability of those petitions with reference to the provisions contained in the KTPP Act.

noticed herein. For better understanding the relevant portions are extracted as hereunder;

“12. Therefore, though a statutory bar or an alternate remedy as contemplated in law does not arise at this stage, the question still would be as to whether the petitions are premature and/or as to whether this Court while considering the petition under Article 226 of the Constitution of India is expected to interfere at this stage when the contract has not been awarded nor any of the tenderers are expressly rejected. 16. A cumulative perusal of the decisions relied upon by both the sides would indicate that the overwhelming opinion is that the Court will not interfere unless the cause to do so has arisen i.e., until the decision one way or the other is taken by the competent authority who is required to take the decision and such decision is in favour of one and has effected the other. In the case of Siemens, though the Hon’ble Supreme Court examined the matter, it did not interfere though on opening the bid, the petitioner therein who had quoted the lowest but was not treated as the L-1 after evaluation. The Hon’ble Supreme Court has no doubt held that judicial

review is possible when the decision making process is so arbitrary or irrational. In the said case, the discussion with the petitioner was excluded. However, in the instant case, evaluation was made by the Committee itself taking note of the requirement and the bids made and thereafter the discussion has commenced with L-1 but the other tenderers have not been rejected. Therefore, on opening the bids, the evaluation procedure has been same for all, though there is serious dispute with regard to the method adopted in arriving at L-1 by applying different standards of ‘discounting’ and ‘loading’ for different tenderers. That aspect of the matter no doubt would arise for consideration only after all evaluations and negotiations are complete and a decision relating to acceptance of any tender is made. Any examination at this stage based on apprehension is only fishing for discrepancies since the petitioners are also contending based on reliable information and not on concrete material. Further, unless this Court comes to a conclusion regarding the imminent necessity of probing the matter further, it would not be necessary for the ‘KPCL’ to divulge any further details at this stage since the process is still under way. In

the decision in the case of Ganapathi RV- Talleres, it was a case where the petitioner therein had been communicated that he had not met the eligibility criteria of the tender and therefore the commercial bid will not be considered. Hence, a cause had arisen to approach the Court due to rejection and the Court directed consideration along with the other tenderers but, in the instant case, there is neither rejection nor acceptance at this stage.

deviation or relaxation or price difference should not be the basis for interference as the same are also permissible depending on its nature and interference should be only if there is substantial public interest. When that is the yardstick to be applied to examine the decisions even at a stage when the awarding of the contract is complete, the interference when the process is still going on should be with greater restraint and minimal.

provision cannot act as a bar to provide information to this Court, certainly in the evaluation process, such confidentiality requires to be maintained to prevent the tenderers from interfering with the process and manipulating the same. In the present circumstance, ‘KPCL’ has indicated the nature of evaluation that has been made and procedure followed. Though as noticed it would be open for this Court to seek for information at any stage, the contention of ‘L & T’ with regard to ‘Alstom’ being favoured is based on certain assumptions relating to the inappropriate manner of loading and discounts being provided which stems from the basis that when the bids were opened, the price quoted by ‘L & T’ was much lower, but presently ‘Alstom’ has been treated as L1. Since the proceedings before this Court in these petitions is at a stage prior to award of contract, I am of the opinion that it is not a stage where this Court is expected to make a roving inquiry by seeking for information relating to the evaluation made by experts by throwing open the entire gambit at this stage and provide an opportunity to the rival tenderers to fish for evidence and pick holes, more particularly at a stage when ‘KPCL’ is

contending that the matter has not been finalized and such casual interference if entertained would become the order of the day since in every evaluation process, one or the other would have some grievance and no process could be finalised. Even assuming the contentions put forth by ‘L & T’ is substantially true, the judicial review at the appropriate stage and forum would be available and it could be made in the matter subsequently instead of stalling the process by examining at every stage. This is so for the reason that even if all materials are placed before this Court, considering the technical nature and volume of the project, there would be several aspects which would go into the evaluation of the bids for the proper completion of the work and the instant case is not a simple case of comparing the difference of price for supply of certain goods, the quality of which are held to be similar. Therefore, the exercise of sitting in judgment over the wisdom of the experts should be avoided at this stage. 28. In the above background, the statement filed by ‘KPCL’ would disclose that on opening the price bids of all the four bidders, all of them have been evaluated and

an evaluation report was prepared which was examined by Tender Scrutiny Committee and along with the report, it was put up to Technical Committee. Further, the evaluation made was also got verified by an independent firm of Chartered Accountant. All the evaluations and the reports have been placed before the Tender Accepting Authority which is the Board of Directors and the further procedure is under way. The learned senior counsel for the petitioners while referring to the averment in the objection statement and the recording in the Board meeting dated 04.12.2012 sought to contend that the discussions with regard to the technical and commercial deviations after evaluation of the tenders would not be sustainable. Despite the same, keeping in view the deviations being alleged against one another, and also taking note of the fact that all the tenders have been evaluated, if at all there are any errors in the manner of evaluation and if judicial review is necessary, the same could only be made in an appropriate proceedings at an appropriate stage and not when the process is not yet completed.

stage of completion of the technical bid evaluation wherein three other tenderers including the third respondent who has come on record have qualified in the technical bid evaluation and two others who have qualified are not even before this Court as parties to this petition. The learned senior counsel for the petitioner no doubt contended that this Court had not chosen to rely on the decision in the case of Ganpathi RV-Talleres for the conclusion in TATA Projects Ltd. case since in that circumstance there was no rejection of the bid. Such hair splitting argument cannot be acceded to when the consideration therein was also the grievance relating to the improper evaluation, the result of which will end in rejection of the financial bid and also when this Court had referred to other decisions of the Hon,ble Supreme Court and had bowed down to the overwhelming opinion of the highest Court. As such one of the many decisions that was considered therein also cannot be looked at in isolation to come to a different conclusion herein. In any event, the consideration made by the Hon'ble Supreme Court in Ganpathi RV-Talleres and

by the Hon'ble Division Bench of the Gujarat High Court in the case of Ashapura Enterprise -vs- Central Warehousing Corporation (2010 SCC Online Guj 7811) relied on by learned senior counsel for the petitioner are not cases which were considered in the backdrop of the procedure contemplated and the statutory remedy ultimately available at the end of such process under the KTPP Act nor was any other similar statutory provisions the basis. Hence, the said decisions in any event does not persuade me to take a different view.

and after evaluation of the materials produced to satisfy the conditions. In that view, in every tender process there will be at least one aggrieved tenderer if they are found to be not qualified, unless it is a rare situation that all of them qualify in the technical bid evaluation. No tender process will conclude if this Court begins to interfere at every stage without restraint, to undertake the exercise of judicial review unmindful of the circumstance. The aggrieved party in any event is not without remedy since such party is provided a remedy of appeal under the statute to be availed at the appropriate stage. In the instant case itself it is noticed that the stipulated period for completion of work under the short tender notification dated 11.11.2015 is 18 months and half of that period is already spent before this Court in this petition without further progress in the tender process and such delay is also going to escalate the cost of the project as the quoted rates will lose its relevance by the time the tender is finalised and work is awarded, due to which public interest is not served either.

to ensure supply or it may be the requirement to produce the work experience certificate as in the instant case and if the tenderer has produced such certificate but the Tender Scrutiny Committee without taking into consideration such certificate or by ignoring the same holds the bid to be ineligible or not qualified for that reason and in such case, if the tenderer is before this Court making out a grievance, certainly interference is possible in that circumstance so as to direct consideration of the document already submitted and analyse the technical bid by re-doing the process at that stage itself without waiting for the process to be completed and avail the remedy of appeal. On the other hand if the Tender Scrutiny Committee has taken into consideration such document/certificate also along with the other materials, but on analysis does not find it to satisfy the requirement of the tender conditions for the reasons recorded and therefore holds the technical bid as not qualified, in such event, this Court should decline interference in a writ petition and halt the entire

process. In such event, the aggrieved party should avail the remedy of appeal after the process is complete.

only Rs.28.35 crores. In respect of the construction of aqueduct for which the work done certificate dated 11.11.2015 was submitted and the period of completion of the work was mentioned therein as March 2013, on clarification, through the communication dated 06.01.2016 it has been informed to the respondents No.1 and 2 that it was an error, but the actual completion was during February 2014. In that light, the appropriate weightage to be provided to the completed work is also a disputed issue as the petitioner claims it to be 30% which is disputed by the respondents No.1 and 2.

senior counsel for the respondents on the other hand has referred to the uniform procedure followed to secure the confirmation from the certificate issuing authorities in respect of all the tenders and the manner of evaluation made and to justify the same, relevant documents were referred. Though I have taken note of the documents on elaborately hearing the learned senior counsel on both sides, I do not find it necessary to refer to each of them since the very nature of contention will disclose that disputed questions of fact leading to the technical bid evaluation is being raised with regard to the documents which were evaluated and a conclusion was reached by the Technical Scrutiny Committee on analysis of the documents that were available before it. The dispute raised herein seeking judicial review at this stage is with regard to the mode and method adopted for evaluation and the decision based on the documents evaluated. The very nature of the contentions urged will indicate that it will fall outside the parameter indicated above to entertain a writ petition at this stage and examine such contention. Hence it is not necessary to

advert to further details of the rival contentions on merits. In addition to the contention that the petitioner is qualified, the petitioner is also seeking to contend that the evaluation of the bid of respondent No.3 is also not proper, by referring to the documents produced by respondent No.3, the work performed and it is contended that respondent No.3 cannot be considered as technically qualified.

“Technical Committee” which is not a part of the process provided under Rule 28 of the KTPP Rules nor was vested with the duty of evaluation, had recommended the elimination of the petitioner therein which was accepted by the Tender Accepting Authority. The learned single Judge had therefore found fault with the procedure adopted, but instead of directing rectification of the error and to proceed from that stage, had directed re-tendering. It is in that circumstance the Hon'ble Division Bench also agreed with the flaw noticed but instead of re-tendering directed reconsideration of the same tender process from the stage the flaw had occurred. In my opinion, it is a case which fell within the parameter indicated above where only a procedural flaw had occurred, which was noticed and on ironing out the crease it was put back on rail. It is not a case which required judicial review of the bid evaluation nor is any other contrary position declared in that case.

apt to the situation on hand to refuse the exercise of discretion under Article 226 of the Constitution in a matter of the present nature.

Court to exercise its discretion under Article 226 of the Constitution and intervene in the matter at this stage.

Hence, the petition being premature is disposed of accordingly without order as to costs.

Sd/-

JUDGE

akc/bms