No Acts & Articles mentioned in this case
High Court of H.P.IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
CWP No. 3583 of 2020.
Judgment reserved on: 23.09.2020.
Date of decision: 28.09.2020.
M/s Chamunda Construction Company …..Petitioner.
Versus
State of Himachal Pradesh and others
…..Respondents.
Coram
The Hon’ble Mr. Justice Tarlok Singh Chauhan, Judge.
The Hon’ble Ms. Justice Jyotsna Rewal Dua, Judge.
Whether approved for reporting?
1
Yes
For the Petitioner :Mr. B.C. Negi, Senior
Advocate with Mr. Nitin
Thakur, Advocate.
For the Respondents: Mr. Ashok Sharma, Advocate
General with Mr. Vikas
Rathore, Mr. Vinod Thakur,
Mr. Shiv Pal Manhans,
Additional Advocate
Generals, Ms. Seema
Sharma, Mr. Bhupinder
Thakur and Mr. Yudhbir
Thakur, Deputy Advocate
Generals, for respondents
No.1 to 5/State.
(Through Video Conferencing)
1
Whether the reporters of the local papers may be allowed to see the Judgment?Yes
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Tarlok Singh Chauhan, Judge
The petitioner has sought quashing of the entire
tender work of Neugal Khad along Sourav Ban Vihar in
Tehsil Palampur, District Kangra, H.P. regarding construction
of retaining walls, wire crate works, stacking works and
dredging works and has further sought quashing of the
action of the respondents in rejecting the claim of the
petitioner at the technical bid stage. In addition thereto,
the petitioner has also sought quashing of the letter dated
29.08.2020, whereby the petitioner has been held to be a
non-participating firm.
2. Respondent No.5 i.e. Executive Engineer, Jal
Shakti Division, Palampur, on behalf of the Government of
Himachal Pradesh, invited item rate bids for the aforesaid
works. In all six number of bidders/firms/contractors
including the petitioner firm participated in the e-tender
process dated 03.08.2020.
3. The technical bid was opened online on
17.08.2020 by respondent No.5, who referred the same for
further scrutiny by an Evaluation Committee at Jal Shakti
Circle Dharamshala for further examination.
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4. The Superintendent Engineer after examining
the case referred it for further examination at Zonal Office
by a technical Committee by respondent No.3, which found
that the petitioner firm/contractor and another
contractor/firm ‘M/s Gagan Kumar Ohri’ were not eligible
as both did not fulfill the eligibility criteria that was
stipulated in the Notice Inviting Tender (NIT).
5. Accordingly, respondent No.3 i.e. Chief Engineer,
Dharamshala Zone referred the matter for further
clarification to respondent No.2, who observed that the
petitioner firm/contractor did not fulfill the eligibility criteria
as the work done certificate relied upon by the petitioner
firm/contractor was not of the participating firm, which
meant that the petitioner firm/contractor consists of three
partners viz; Sh. Pankaj Sharma, S/o Sh. Som Raj, R/o VPO
Indora, Tehsil Indora, District Kangra, H.P.; Sh. Mohinder
Sharma, S/o Sh. Ram Lal, R/o VPO Damtal, Tehsil Indora,
District Kangra, H.P. and Sh. Naresh Padiyal, S/o late Sh. Bal
Krishan, R/o Village Sheela Chowk, P.O. Sidhpur, Tehsil
Dharamshala, District Kangra, H.P., each having share to the
extent of 40%, 40% and 20%, respectively and the work
experience furnished is of Naresh Padiyal, whose share is
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only to the extent of 20%. Therefore, the participating firm
i.e. the petitioner firm/contractor did not fulfill the criteria of
having work experience of 50% of the estimated cost.
Moreover, the similar work stipulated in the NIT was of
‘Wire Crate Work in Flood Protection Works’, whereas, the
petitioner firm /contractor partner, namely, Sh. Naresh
Padiyal had furnished the work experience of construction
of Science Block/Buildings which were altogether different
from the required ‘Flood Protection Works’ as stipulated in
the NIT. Therefore, the petitioner firm/contractor was held
ineligible and further process was undertaken to complete
the codal formalities for final awarding the work in favour
of the Lowest-1.
6. As per ‘NIT’, the definition of similar work as set
out in the uploaded tender documents is as under:
“(a) Experience on similar works executed during
the last seven years and details like monetary value,
clients proof of satisfactory completion should be
furnished before purchase of tender documents. The
eligibility criteria are: Satisfactorily completed as
prime contractor similar nature work, ( similar
nature means firm must have completed wire
crate work in flood protection works and
concrete work separately or together in a work
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of following financial values) at least as under:
1. The bidder must have completed three similar
works costing each not less than 40% of the given
estimated cost for which the bid is invited which
instant case is Rs.2,39,54,758(minimum value).
Or
2. The bidder must have completed two similar
works costing each not less than 50% of the given
estimated cost for which the bid is invited which
instant case is Rs.2,99,43,447.
Or
3. The bidder must have completed one similar
works costing not less than 80% of the given
estimated cost for which th bid is invited which
instant case is Rs.4,79,09,515.
Note:- Work shall be considered completed if it is
executed 90% either awarded physical quantity or
financial value.”
7. The petitioner firm submitted three numbers work
done certificates, which are detailed as under:
S.No.Name of
Firm/
Contractor
Name of Work Value and
Remarks
1. M/S
Chamunda
Construction
Company
Providing flood
protection work to
Lunkhari Khad in Tehsil
Bangana Distt. Una (HP)
(Sub Head: C/o 455
mtrs. Long earthen
embankment including
wire crated apron,
pitching etc. from RD
38,20,393/-
(less than
required
criteria of 40%
or 50% or
80%, as the
case may be)
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5515 to RD 5960 on left
bank of Lunkhari Khad.
2. Naresh
Padiyal
Construction of Science
Block in Govt. Degree
College at Dharamshala,
Tehsil Dharamshala,
Distt. Kangra, H.P. (Sub
Head: Construction of
building i/c W/S &S/I
and rain water
harvesting system etc.
3,56,46,575/-
This work is of
construction of
buildings and
not of Wire
Crate Work in
Flood
Protection
Works.
Moreover, it is
less than the
90% of
completion
value against
awarded
amount of
Rs.7.65 lacs,
therefore, it is
of on-going
works and not
of completed
works.
3. Naresh
Padiyal
Construction of
additional
accommodation for
Judicial Court Complex
Block A&B at
Dharamshala,Tehsil
Dharamshala, Distt.
Kangra, H.P. (Sub Head:
Balance work of building
portion i/c W/S &S/I and
rain water harvesting
etc.
4,51,03,436/-
This work is of
construction of
buildings and
not of Wire in
Flood
Protection
Works as per
NIT
requirement.
8. The respondents found the value of the work was
only Rs.38.20 lacs which did not constitute either 80% or
50% or 40% of the estimated cost put to tender in question
i.e. Rs.2,39,20,000/-, and, therefore, the petitioner did not
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fulfill the condition of NIT and his tender was accordingly
rejected.
9. However, Shri B.C.Negi, Senior Advocate assisted
by Shri Nitin Thakur, Advocate, for the petitioner, would
contend that the act of the respondent-department in
rejecting the claim of the petitioner at the technical
evaluation for not submitting work of similar nature done of
the firm is against the prevalent practice. In addition, he
would argue that the respondent-department cannot adopt
different yardsticks in judging thees works which depicts
biasness and arbitrariness on the part of the respondent-
department.
10. On the other hand, the learned Advocate General
would argue that the petition is not maintainable as the
petitioner does not fulfill the eligibility criteria and was
rightly kept out of consideration of the evaluation after the
technical bids.
11. We have heard the learned counsel for the parties
and gone through the records of the case.
12. The law relating to award of a contract by the
State, its corporations and bodies acting as instrumentalities
and agencies of the Government has been settled by the
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decisions of the Hon’ble Supreme Court in R.D. Shetty vs.
International Airport Authority (1979) 3 SCC 488,
Fertilizer Corporation Kamgar Union vs. Union of
India (1981) 1 SCC 568, Assistant Collector, Central
Excise vs. Dunlop India Ltd. (1985) 1 SCC 260=1984
(2) SCALE 819, Tata Cellular vs. Union of India (1994)
6 SCC 651= 1995 (1) Arb. LR 193, Ramniklal N.Bhutta
vs. State of Maharashtra (1997) 1 SCC 134= 1996 (8)
SCALE 417 and Raunaq International Ltd. vs. I.V.R.
Construction Ltd. (1999) 1 SCC 492=1999 (1) Arb. LR
431 (SC).
13. The award of a contract, whether it is by a private
party or by a public body or the State, is essentially a
commercial transaction. In arriving at a commercial decision
consideration which are of paramount are commercial
considerations. The State can choose its own method to
arrive at a decision. It can fix its own terms of invitation to
tender and that is not open to judicial scrutiny. It can enter
into negotiations before finally deciding to accept one of the
offers made to it. Price need not always be the sole criterion
for awarding a contract. It is free to grant any relaxation, for
bona fide reasons, if the tender conditions permit such a
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relaxation. It may not accept the offer even though it
happens to be the highest or the lowest. But the State, its
corporations, instrumentalities and agencies are bound to
adhere to the norms, standards and procedures laid down by
them and cannot depart from them arbitrarily. Though that
decision is not amenable to judicial review, the Court can
examine the decision making process and interfere if it is
found vitiated by mala fides, unreasonableness and
arbitrariness.
14. The State, its corporations, instrumentalities and
agencies have the public duty to be fair to all concerned.
Even when some defect is found in the decision making
process the Court must exercise its discretionary power
under Article 226 with great caution and should exercise it
only in furtherance of public interest and not merely on the
making out of a legal point. The Court should always keep
the larger public interest in mind in order to decide whether
its intervention is called for or not. Only when it comes to a
conclusion that overwhelming public interest requires
interference, the Court should intervene.
15. It is well settled that the Court should not
ordinarily interfere in commercial activities under its power
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of judicial review and reference in this regard can
conveniently be made to a fairly recent judgment of the
Hon’ble Supreme Court in Silppi Constructions
Contractors vs. Union of India and another etc. etc.
(2019) 11 Scale 592, wherein it was observed as under:
“6. Aggrieved, the original writ petitioner is before
us in these petitions. This Court in a catena of
judgments has laid down the principles with
regard to judicial review in contractual matters. It
is settled law that the writ courts should not easily
interfere in commercial activities just because
public sector undertakings or government
agencies are involved.
7. In Tata Cellular vs. Union of India (1994) 6 SCC
651, it was held that judicial review of
government contracts was permissible in order to
prevent arbitrariness or favouritism. The
principles enunciated in this case are :
“94. …….
(1) The modern trend points to judicial
restraint in administrative action.
(2) The Court does not sit as a court of
appeal but merely reviews the manner in
which the decision was made.
(3) The Court does not have the expertise
to correct the administrative decision. If a
review of the administrative decision is
permitted it will be substituting its own
decision, without the necessary expertise
which itself may be fallible.
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(4) The terms of the invitation to tender
cannot be open to judicial scrutiny because
the invitation to tender is in the realm of
contract.
Normally speaking, the decision to accept
the tender or award the contract is reached
by process of negotiations through several
tiers. More often than not, such decisions
are made qualitatively by experts.
(5) The Government must have freedom of
contract. In other words, a fair play in the
joints is a necessary concomitant for an
administrative body functioning in an
administrative sphere or quasi -
administrative sphere. However, the
decision must not only be tested by the
application of Wednesbury principle of
reasonableness (including its other facts
pointed out above) but must be free from
arbitrariness not affected by bias or
actuated by mala fides.
(6) Quashing decisions may impose heavy
administrative burden on the administration
and lead to increased and unbudgeted
expenditure.”
8. In Raunaq International Ltd. vs. I.V.R.
Construction Ltd. (1999) 1 SCC 492, this Court
held that superior courts should not interfere in
matters of tenders unless substantial public
interest was involved or the transaction was mala
fide.
9. In Air India Limited vs. Cochin International
Airport Ltd.(2000) 2 SCC 617, this Court once
again stressed the need for overwhelming public
interest to justify judicial intervention in contracts
involving the State and its instrumentalities. It was
held that Courts must proceed with great caution
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while exercising their discretionary powers and
should exercise these powers only in furtherance
of public interest and not merely on making out a
legal point.
10. In Karnataka SIIDC Ltd. vs. Cavalet India Ltd.
(2005) 4 SCC 456, it was held that while effective
steps must be taken to realise the maximum
amount, the High Court exercising its power under
Article 226 of the Constitution is not competent to
decide the correctness of the sale affected by the
Corporation.
11. In Master Marine Services (P) Ltd. vs. Metcalfe
& Hodgkinson (P) Ltd.(2005) 6 SCC 138, it was
held that while exercising power of judicial review
in respect of contracts, the Court should concern
itself primarily with the question, whether there
has been any infirmity in the decision making
process. By way of judicial review, Court cannot
examine details of terms of contract which have
been entered into by public bodies or State.
12. In B.S.N. Joshi & Sons Ltd. vs. Nair Coal
Services Ltd.(2006) 11 SCC 548, it was held that it
is not always necessary that a contract be
awarded to the lowest tenderer and it must be
kept in mind that the employer is the best judge
therefor; the same ordinarily being within its
domain. Therefore, the court's interference in such
matters should be minimal. The High Court's
jurisdiction in such matters being limited, the
Court should normally exercise judicial restraint
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unless illegality or arbitrariness on the part of the
employer is apparent on the face of the record.
13. In Jagdish Mandal vs. State of Orissa (2007) 14
SCC 517, it was held:
“22. Judicial review of administrative action is
intended to prevent arbitrariness, irrationality,
unreasonableness, bias and mala fides. Its
purpose is to check whether choice or
decision is made “lawfully” and not to check
whether choice or decision is “sound”. When
the power of judicial review is invoked in
matters relating to tenders or award of
contracts, certain special features should be
borne in mind. A contract is a commercial
transaction. Evaluating tenders and awarding
contracts are essentially commercial
functions. Principles of equity and natural
justice stay at a distance. If the decision
relating to award of contract is bona fide and
is in public interest, courts will not, in exercise
of power of judicial review, interfere even if a
procedural aberration or error in assessment
or prejudice to a tenderer, is made out. The
power of judicial review will not be permitted
to be invoked to protect private interest at the
cost of public interest, or to decide
contractual disputes. The tenderer or
contractor with a grievance can always seek
damages in a civil court. Attempts by
unsuccessful tenderers with imaginary
grievances, wounded pride and business
rivalry, to make mountains out of molehills of
some technical/procedural violation or some
prejudice to self, and persuade courts to
interfere by exercising power of judicial
review, should be resisted. Such
interferences, either interim or final, may hold
up public works for years, or delay relief and
succour to thousands and millions and may
increase the project cost manifold……..”
14. In Michigan Rubber (India) Ltd. vs. State of
Karnataka & Ors. (2012) 8 SCC 216, it was held
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that if State or its instrumentalities acted
reasonably, fairly and in public interest in
awarding contract, interference by Court would be
very restrictive since no person could claim
fundamental right to carry on business with the
Government. Therefore, the Courts would not
normally interfere in policy decisions and in
matters challenging award of contract by State or
public authorities.
15. In Afcons Infrastructure Ltd. vs. Nagpur Metro
Rail Corporation Ltd. (2016) 16 SCC 818, it was
held that a mere disagreement with the decision-
making process or the decision of the
administrative authority is no reason for a
constitutional Court to interfere. The threshold of
mala fides, intention to favour someone or
arbitrariness, irrationality or perversity must be
met before the constitutional Court interferes with
the decision making process or the decision. The
owner or the employer of a project, having
authored the tender documents, is the best
person to understand and appreciate its
requirements and interpret its documents. It is
possible that the owner or employer of a project
may give an interpretation to the tender
documents that is not acceptable to the
constitutional Courts but that by itself is not a
reason for interfering with the interpretation
given.
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16. In Montecarlo vs. NTPC Ltd. AIR 2016 SC 4946,
it was held that where a decision is taken that is
manifestly in consonance with the language of the
tender document or sub serves the purpose for
which the tender is floated, the court should follow
the principle of restraint. Technical evaluation or
comparison by the court would be impermissible.
The principle that is applied to scan and
understand an ordinary instrument relatable to
contract in other spheres has to be treated
differently than interpreting and appreciating
tender documents relating to technical works and
projects requiring special skills. The owner should
be allowed to carry out the purpose and there has
to be allowance of free play in the joints.
17. In Municipal Corporation, Ujjain and Another
vs. BVG India Ltd. and Others (2018) 5 SCC 462 ,
it was held that the authority concerned is in the
best position to find out the best person or the
best quotation depending on the work to be
entrusted under the contract. The Court cannot
compel the authority to choose such undeserving
person/company to carry out the work. Poor
quality of work or goods can lead to tremendous
public hardship and substantial financial outlay
either in correcting mistakes or in rectifying
defects or even at times in redoing the entire
work.
18. Most recently this Court in Caretel Infotech
Limited vs. Hindustan Petroleum Corporation
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Limited and Others (2019) 6 Scale 70 observed
that a writ petition under Article 226 of the
Constitution of India was maintainable only in
view of government and public sector enterprises
venturing into economic activities. This Court
observed that there are various checks and
balances to ensure fairness in procedure. It was
observed that the window has been opened too
wide as every small or big tender is challenged
as a matter of routine which results in
government and public sectors suffering when
unnecessary, close scrutiny of minute details is
done.
19. This Court being the guardian of fundamental
rights is duty bound to interfere when there is
arbitrariness, irrationality, mala fides and bias.
However, this Court in all the aforesaid decisions
has cautioned time and again that courts should
exercise a lot of restraint while exercising their
powers of judicial review in contractual or
commercial matters. This Court is normally
loathe to interfere in contractual matters unless a
clearcut case of arbitrariness or mala fides or
bias or irrationality is made out. One must
remember that today many public sector
undertakings compete with the private industry.
The contracts entered into between private
parties are not subject to scrutiny under writ
jurisdiction. No doubt, the bodies which are State
within the meaning of Article 12 of the
Constitution are bound to act fairly and are
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amenable to the writ jurisdiction of superior
courts but this discretionary power must be
exercised with a great deal of restraint and
caution. The Courts must realise their limitations
and the havoc which needless interference in
commercial matters can cause. In contracts
involving technical issues the courts should be
even more reluctant because most of us in
judges’ robes do not have the necessary
expertise to adjudicate upon technical issues
beyond our domain. As laid down in the
judgments cited above the courts should not use
a magnifying glass while scanning the tenders
and make every small mistake appear like a big
blunder. In fact, the courts must give “fair play in
the joints” to the government and public sector
undertakings in matters of contract. Courts must
also not interfere where such interference will
cause unnecessary loss to the public exchequer.
20. The essence of the law laid down in the
judgments referred to above is the exercise of
restraint and caution; the need for overwhelming
public interest to justify judicial intervention in
matters of contract involving the state
instrumentalities; the courts should give way to
the opinion of the experts unless the decision is
totally arbitrary or unreasonable; the court does
not sit like a court of appeal over the appropriate
authority; the court must realise that the
authority floating the tender is the best judge of
its requirements and, therefore, the court’s
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interference should be minimal. The authority
which floats the contract or tender, and has
authored the tender documents is the best judge
as to how the documents have to be interpreted.
If two interpretations are possible then the
interpretation of the author must be accepted.
The courts will only interfere to prevent
arbitrariness, irrationality, bias, mala fides or
perversity. With this approach in mind we shall
deal with the present case.”
16. Similar reiteration of law can be found in another
recent judgment of the Hon’ble Supreme Court in M/s N.
Ramachandra Reddy vs. State of Telangana and
others, AIR 2019 SC 4182 .
17. Bearing in mind the aforesaid exposition of law,
we really do not find any infirmity much less an illegality in
the action of the respondents in rejecting the case of the
petitioner for not having requisite experience of executing
similar works, as the combined value of the work of the
petitioner is Rs.38.20 lacs as against the requirement of
Rs.2,39,20,000/- and the same does not constitute either
80% or 50% or for that matter 40% of the estimated cost put
to the tender in question.
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18. Confronted with this, learned Senior counsel for
the petitioner would argue that the respondents should have
taken into consideration the other works of similar nature
executed by one of its partner Naresh Padiyal as depicted at
serial No. 2 and 3.
19. We have considered the submissions and are of
the considered view that now that the respondents have
evaluated similar contracts towards experience, it is not
open for this Court to review the said order, especially,
when the same is neither perverse, mala fide nor intended to
favour one of the tenderers.
20. In drawing such conclusion, we are supported by
the judgment of the Hon’ble Supreme Court in Afcons
Infrastructure Ltd. vs. Nagpur Metro Rail Corporation
Ltd., (2016) 16 SCC 818 at 825-26, para 4.2(a) of Section
III of the tender conditions in support of certain similar
contracts, as previous works experience. The question before
the Hon’ble Supreme Court was whether an inter-state high
speed railway project could be similar to metro civil
construction work. After laying down the parameters of
judicial review and referring to various judgments for the
same, the Hon’ble Supreme Court held as under:
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“15. We may add that the owner or the employer
of a project, having authored the tender
documents, is the best person to understand and
appreciate its requirements and interpret its
documents. The constitutional Courts must defer
to this understanding and appreciation of the
tender documents, unless there is mala fide or
perversity in the understanding or appreciation or
in the application of the terms of the tender
conditions. It is possible that the owner or
employer of a project may give an interpretation
to the tender documents that is not acceptable to
the constitutional Courts but that by itself is not a
reason for interfering with the interpretation
given.
16. In the present appeals, although there does
not appear to be any ambiguity or doubt about
the interpretation given by NMRCL to the tender
conditions, we are of the view that even if there
was such an ambiguity or doubt, the High Court
ought to have refrained from giving its own
interpretation unless it had come to a clear
conclusion that the interpretation given by NMRCL
was perverse or mala fide or intended to favour
one of the bidders. This was certainly not the case
either before the High Court or before this Court.
21. In Montecarlo Ltd. vs. NTPC Ltd. (2016) 15
SCC 272 at 288 , the Hon’ble Supreme Court referred to
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various judgments including the judgment in Afcons
Infrastructure Ltd.(supra) and concluded as follows:
“26. We respectfully concur with the aforesaid
statement of law. We have reasons to do so. In
the present scenario, tenders are floated and
offers are invited for highly complex technical
subjects. It requires understanding and
appreciation of the nature of work and the
purpose it is going to serve. It is common
knowledge in the competitive commercial field
that technical bids pursuant to the notice inviting
tenders are scrutinized by the technical experts
and sometimes third party assistance from those
unconnected with the owner’s organization is
taken. This ensures objectivity. Bidder’s expertise
and technical capability and capacity must be
assessed by the experts. In the matters of
financial assessment, consultants are appointed.
It is because to check and ascertain that technical
ability and the financial feasibility have sanguinity
and are workable and realistic. There is a multi-
prong complex approach; highly technical in
nature. The tenders where public largesse is put
to auction stand on a different compartment.
Tender with which we are concerned, is not
comparable to any scheme for allotment. This
arena which we have referred requires technical
expertise. Parameters applied are different. Its
aim is to achieve high degree of perfection in
execution and adherence to the time schedule.
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But, that does not mean, these tenders will
escape scrutiny of judicial review. Exercise of
power of judicial review would be called for if the
approach is arbitrary or malafide or procedure
adopted is meant to favour one. The decision
making process should clearly show that the said
maladies are kept at bay. But where a decision is
taken that is manifestly in consonance with the
language of the tender document or subserves
the purpose for which the tender is floated, the
court should follow the principle of restraint.
Technical evaluation or comparison by the court
would be impermissible. The principle that is
applied to scan and understand an ordinary
instrument relatable to contract in other spheres
has to be treated differently than interpreting and
appreciating tender documents relating to
technical works and projects requiring special
skills. The owner should be allowed to carry out
the purpose and there has to be allowance of free
play in the joints.”
22. Similar issue thereafter came up before the
Hon’ble Supreme Court in Sam Built Well Private Limited
vs. Deepak Builders and others, (2018) 2 SCC 176
wherein the Hon’ble Supreme Court after placing reliance on
the aforesaid judgments observed as under:
“12.We have already noticed that three expert
committees have scrutinized Respondent No.1’s
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High Court of H.P.23
tender and found Respondent No.1 to be
ineligible. The impugned judgment of the Division
Bench of the High Court expressly states that no
malafides are involved in the present case.
Equally, while setting aside the judgment of the
learned Single Judge, the Division Bench does not
state that the three expert committees have
arrived at a perverse conclusion. To merely set
aside the judgment of the learned Single Judge
and then jump to the conclusion that Respondent
No.1’s tender was clearly eligible, would be
directly contrary to the judgments aforestated.
Not having found malafides or perversity in the
technical expert reports, the principle of judicial
restraint kicks in, and any appreciation by the
Court itself of technical evaluation, best left to
technical experts, would be outside its ken. As a
result, we find that the learned Single Judge was
correct in his reliance on the three expert
committee reports. The Division Bench, in setting
aside the aforesaid judgment, has clearly gone
outside the bounds of judicial review. We,
therefore, set aside the judgment of the Division
Bench and restore that of the learned Single
Judge.”
23. It is next contended by learned Senior Counsel
for the petitioner that the respondents cannot adopt two
different yardsticks while carrying out the technical
evaluation. He in particular has invited our attention to the
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High Court of H.P.24
proceedings of the meeting for opening of technical bids
held on 16.01.2015 (Annexure P-9) regarding Swan River
Flood Management Project from Daulatpur Bridge to Gagret
Bridge in Main Swan River and all tributaries joining main
Swan River from Daulatpur Bridge to Santokhgarh Bridge in
Distt. Una (HP) (Phase-4
th
) (SH:- Construction of Earthen
embankment including wire crated apron, stone pitching &
RCC bod etc. from RD 31050/0 to 5000 on both sides of
“Panjawar/Nagnoli Khad” on Right bank of Swan River (From
RD 31050/0 to 2000 on both side of Khad) (For 1
st
km & 2
nd
km).
24. It is argued that while evaluating these bids of
the similar nature, the respondents awarded the work to M/s
R.S. Constructions after holding its work of concrete lining of
Rajpura Disty at District Fatehgarh Sahib satisfactory
towards experience of having successfully completed similar
works.
25. We have considered the argument and in absence
of any particulars and records regarding the terms and
conditions of the tender, the nature of the work etc. are not
in a position to uphold the contention, but nonetheless, we
can definitely observe that the respondents after specifically
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High Court of H.P.25
and clearly laying down the terms and conditions should not
and cannot deviate from the conditions. After-all, the
respondents being a State cannot be permitted to say that
“show me the face and I will show you the rule”.
26. Learned Senior Counsel for the petitioner would
then argue that since this substantial compliance with the
tender conditions regarding experience and executing the
work had been made, the claim of the petitioner should not
have been rejected.
27. In support of such contention, reliance is placed
by the learned Senior Counsel for the petitioner, on the
judgment of the Hon’ble Supreme Court in B.S.N. Joshi &
Sons Ltd. vs. Nair Coal Services Ltd. and others (2006)
11 SCC 548, more particularly, the observations made in
paragraphs No. 8, 24, 28, 66(v) and 69 and another
judgment of the Hon’ble Supreme Court in Tejas
Constructions and Infrastructure Private Limited vs.
Municipal Council, Sendhwa and another (2012) 6
SCC 464, more particularly, the observations made in
paragraphs No. 27 to 31.
28. We have gone through these judgments and find
that the same are not at all applicable to the facts of the
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High Court of H.P.26
instant case. What has been laid in the aforesaid judgments
is that when a decision is taken by the appropriate authority
upon due consideration of the tender document submitted
by the tenderers on their own merits and if it is ultimately
found that the successful bidder had in fact substantially
complied with the purport and object for which the essential
conditions were laid down, the same may not ordinarily be
interfered with.
29. This is not the fact situation obtaining in the
instant case because as against the requirement of the
bidder having executed the similar works of at least
Rs.2,39,20,000/-, the petitioner had only an experience of
executing work only of Rs.38.20 lacs and could not,
therefore, be said to have substantially complied with the
conditions of the tender and thus his claim has rightly been
rejected at the technical bid stage.
30. As a last ditch effort, learned Senior Counsel for
the petitioner would argue that the correctness of the order
passed by the respondents can be judged only on the basis
of the reasons stated in the impugned order and not on the
basis of the subsequent materials, much less on the basis of
the affidavit filed before this Court.
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High Court of H.P.27
31. Strong reliance in support of such contention is
placed on the judgment rendered by a Constitutional Bench
of the Hon’ble Supreme Court in Mohinder Singh Gill
and another vs. The Chief Election Commissioner,
New Delhi and others (1978) 1 SCC 405 , wherein it was
observed 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.”….
32. It is not in dispute that one of the primary
reasons for not considering the claim of the petitioner as
per the rejection letter is that “Further, it has been found
that M/S Chamunda Construction Company VPO &Tehsil
Indora Distt. Kangra HP has uploaded work done certificates
which are not of the participating firm”. Whereas, now the
claim of the petitioner is sought to be rejected on additional
grounds as set out above.
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High Court of H.P.28
33. Obviously, there can be no quarrel with the
proposition as laid down by the Hon’ble Supreme Court in
Mohinder Singh Gill’s case (supra), but then it cannot be
ignored that the petitioner is not eligible and cannot be
awarded the work in question and the subsequent material
to support the reason given by the respondents is in the
larger public interest.
34. The Hon’ble Supreme Court in its subsequent
judgment has clearly held that the propositions laid down in
Mohinder Singh Gill’s case (supra) are not applicable
where larger public interest is involved and, in such
circumstances, the additional ground is to be looked into to
examine the validity of the order.
35. Reference in this regard can conveniently be
made to the judgment of the Hon’ble Supreme Court in
Chairman, All India Railway Recruitment Board and
another vs. K.Shyam Kumar and others (2010) 6 SCC
614 and it shall be apposite to refer to paragraphs 44 and
45 of the judgment which reads as under:
“44. We are also of the view that the High Court
has committed a grave error in taking the view
that the order of the Board could be judged only
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High Court of H.P.29
on the basis of the reasons stated in the
impugned order based on the report of vigilance
and not on the subsequent materials furnished by
the CBI. Possibly, the High Court had in mind the
constitution bench judgment of this Court in
Mohinder Singh Gill and Anr. Vs. The Chief Election
Commissioner, New Delhi and Anr. (1978) 1 SCC
405.
45. We are of the view that the decision maker
can always rely upon subsequent materials to
support the decision already taken when larger
public interest is involved. This Court in
Madhyamic Shiksha Mandal, M.P. v. Abhilash
Shiksha Prasar Samiti and Others, (1998) 9 SCC
236 found no irregularity in placing reliance on a
subsequent report to sustain the cancellation of
the examination conducted where there were
serious allegations of mass copying. The principle
laid down in Mohinder Singh Gill's case is not
applicable where larger public interest is involved
and in such situations, additional grounds can be
looked into to examine the validity of an order.
Finding recorded by the High Court that the
report of the CBI cannot be looked into to
examine the validity of order dated 04.06.2004,
cannot be sustained.”
36. The aforesaid judgment was then followed by the
Hon’ble Supreme Court in PRP Exports and others vs.
Chief Secretary, Government of Tamil Nadu and
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High Court of H.P.30
others (2014) 13 SCC 692, in 63 Moons Technologies
and others vs. Union of India and others (2019) SCC
online SC 624 , wherein the Hon’ble Supreme Court
clarified that though there is no broad principles that
Mohinder Singh Gill’s test will not apply where a larger
public interest is involved, subsequent materials in the form
of facts that have taken place after the order in question is
passed, can always be looked at in the larger public
interest, in order to support the administrative order.
37. All the aforesaid judgments have in turn now
been considered and approved by three Judge Bench of
the Hon’ble Supreme Court in Internet and Mobile
Association of India vs. Reserve Bank of India (2020)
3 Madras Law Journal 541 , wherein it was observed as
under:
“ M.S.Gill Reasoning
6.126.The impugned Circular cannot be assailed
on the basis of M. S. Gill test, for two reasons. First
is that in Chairman, All India Railway Recruitment
Board v. K. Shyam Kumar & Ors ,(2010) 6 SCC
614, this court held that MS Gill test may not
always be applicable where larger public interest
is involved and that in such situations, additional
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High Court of H.P.31
grounds can be looked into for examining the
validity of an order. This was followed in PRP
Exports & Ors v. Chief Secretary, Government of
Tamil Nadu & Ors .,(2014) 13 SCC 69. In 63
Moons Technologies ltd. & Ors v. Union of India &
Ors,(2019) SCC online SC 624, this court
clarified that though there is no broad proposition
that MS Gill test will not apply where larger public
interest is involved, subsequent materials in the
form of facts that have taken place after the order
in question is passed, can always be looked at in
the larger public interest, in order to support an
administrative order. The second reason why the
weapon of MS Gill will get blunted in this case, is
that during the pendency of this case, this court
passed an interim order on 21-08- 2019 directing
RBI to give a point-wise reply to the detailed
representation made by the writ petitioners.
Pursuant to the said order, RBI gave detailed
responses on 04-09-2019 and 18-09-2019.
Therefore, the argument based on MS Gill test has
lost its potency.”
38. From the aforesaid discussion and the reasons as
stated above, it is abundantly clear that the petitioner does
not fulfill the eligibility criteria as per NIT and since the work
for which the NIT is issued carries a special nature of work
and it is the prerogative of the respondents/tender
approving authority to include any term and condition as
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High Court of H.P.32
per the requirement of the work to be executed at field and
the same being not perverse, arbitrary or mala fide or with
an intent to benefit anyone of the contractors cannot be
interfered with.
39. Accordingly, we find no merit in this writ petition
and the same is dismissed, leaving the parties to bear their
own costs. Pending application, if any, also stands disposed
of.
(Tarlok Singh Chauhan)
Judge
(Jyotsna Rewal Dua)
Judge
28
th
September, 2020.
(krt)
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