2013 (3) TMI 540 - HC - Indian Laws

Notice Inviting Tender - Facility Management Services to the Election Department - Relevant provisions of the notice inviting tender - Valid tenders - Respondent Nos.3 and 4 submitted technical bids as well as commercial bids tenders - The technical bid of both petitioner and the respondent no 3 were approved by a technical committee constituted by the respondent authority- Held that - In the instant case the respondent authority found that it was the tender of Respondent No. 3, which is the valid tender and in that view of the matter made the settlement with Respondent No. 3 at a value lower than the value quoted by the petitioner and I do not find that to be an illegal or unfair exercise of power. Accordingly the contention that the respondent No. 3 was unduly favoured cannot be accepted. The technical committee evaluated and assessed the capability of both the parties and accordingly approved both petitioner and respondent No.3, for opening of the commercial bid. In my considered opinion, it would not be apposite for this court to re-examine and re-evaluate the Technical bid submitted by the respondent no.3 It is found that the offer made by one of the bidders substantially satisfies the requirements of the conditions of notice inviting tender, the employer may be said to have a general power of relaxation in that behalf. Once such a power is exercised, one of the questions which would arise for consideration by the courts would be as to whether exercise of such power was fair, reasonable and bona fide. If the answer thereto is not in the negative, save and except for sufficient and cogent reasons, the writ courts would be well advised to refrain themselves in exercise of their discretionary jurisdiction. In the present case the exercise of power by the respondent in awarding the contract to the respondent No.3 is not mala fide and unreasonable. It is equally true that even in contractual matters, a public authority does not have an unfettered right to ignore the norms recognized by the Courts, but at the same time, if a decision has been taken by a public authority in a bona fide manner by following the procedure prescribed, although not strictly following the norms laid, such decision is upheld on the principle that the Courts, while judging the constitutional validity of executing decisions, must grant a certain measure of freedom of play in the joints to the executive. I find that there is no merit in this writ application. Accordingly the same is dismissed. The stay order passed earlier shall stand vacated.

Issues Involved:
1. Validity of the tender process and compliance with the Notice Inviting Tender (NIT) conditions.
2. Evaluation and acceptance of technical and commercial bids.
3. Allegations of bias and procedural impropriety.
4. Judicial review of administrative decisions in tender processes.
5. Waiver and estoppel in the context of challenging tender decisions.

Detailed Analysis:

1. Validity of the Tender Process and Compliance with NIT Conditions:
The petitioner argued that the respondent No.3 did not submit valid documents as per the NIT requirements, including the Earnest Money Deposit (EMD) in the specified format, Professional Tax, Service Tax Registration, and other essential documents. The petitioner contended that the documents submitted by respondent No.3 were in the names of different entities (Unit Trust of India Investor Services Limited and UTI Technology Services Limited), which were not valid for the tender process.

2. Evaluation and Acceptance of Technical and Commercial Bids:
The technical bids of the petitioner and respondent No.3 were evaluated by the Technical Committee, which found both bids technically suitable. The commercial bids were then opened, revealing that respondent No.3 quoted a lower price (Rs.4,62,000/-) compared to the petitioner (Rs.5,04,000/-). The petitioner challenged the acceptance of respondent No.3's bid on the grounds of non-compliance with the NIT conditions.

3. Allegations of Bias and Procedural Impropriety:
The petitioner alleged that the Technical Committee's decision was biased and that the presence of a non-member (Deputy Secretary, Finance Department) in the Committee was improper. However, the court found no evidence of mala fides or prejudice against the petitioner. The court noted that the majority decision of the Committee was valid and that the presence of the Deputy Secretary did not invalidate the Committee's decision.

4. Judicial Review of Administrative Decisions in Tender Processes:
The court emphasized that judicial review in tender matters is limited to examining the decision-making process for fairness, reasonableness, and adherence to the law. The court cited several precedents, including Kanhaiya Lal Agrawal v. Union of India and IRCTC v. Doshion Veolia Water Solutions (P) Ltd., to highlight that non-compliance with essential conditions can lead to rejection of a tender. However, minor deviations or technical irregularities may be overlooked if they do not result in substantial prejudice.

5. Waiver and Estoppel in the Context of Challenging Tender Decisions:
The court held that the petitioner, by not raising objections at the earliest opportunity and by participating in the tender process, had waived the right to challenge the decision later. The court referenced Supdt. of Taxes v. Onkarmal Nathmal Trust to explain the principles of waiver and estoppel, noting that the petitioner could not now contest the approval of respondent No.3's technical bid after having accepted the process initially.

Conclusion:
The court dismissed the petition, concluding that the tender process was conducted fairly and transparently. The court found no evidence of bias or procedural impropriety by the Technical Committee. The acceptance of respondent No.3's bid was deemed valid, as the deviations in the submission were considered minor and did not affect the overall fairness of the process. The court reiterated that judicial intervention in tender matters should be exercised with caution and only in cases of clear illegality or arbitrariness.

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