2015 (12) TMI 418 - HC - Service Tax

Rejection of request of rectification of bid - Held that - The financial bids were opened on 20.07.2015. It was thereafter that the said letter dated 21.07.2015 was written by the official respondents to the petitioners calling upon them to rectify the bid. Clause-13 of the NIT specifically provided that a copy of the undertaking shall be scanned and uploaded to the etender website within the period of the bid submission. Further, Clause-15(d) required the undertaking as per Clause-13 to be scanned and uploaded within the period of bid submission. The undertaking furnished by the petitioners was the one dated 10.07.2015, which we referred to earlier. That undertaking, however, provided that service tax will be charged extra, if applicable at any stage. This, as we noted earlier, was contrary to Clause-34. It required the rates to be quoted inclusive inter alia of service tax - The petitioners do not deny that the condition contained in the undertaking is contrary to the terms and conditions of the tender. The petitioners, however, contend that it was an error that the official respondents called upon the petitioners to rectify and that the petitioners had, in fact, rectified the same. The petitioners, therefore, contend that their bid was not liable to be rejected. Clause-30 contemplates clarifications being sought by the official respondents and being furnished by the bidders. The imposition of the condition contrary to the terms of the tender that the price is exclusive of service tax if applicable, does not fall within the ambit of Clause-30. The respondents by their letter dated 21.07.2015 did not seek a clarification in that regard. No clarification was necessary. The condition was clear, namely, that service tax would be charged as applicable. The official respondents did not seek a clarification in that regard. They called upon the petitioners to delete the same. A post bid change in the price is normally not permissible. - Decided against the petitioner.

Summary

Issues:
1. Quashing of a letter rejecting a bid due to withdrawal of additional term.
2. Interpretation of clauses in the e-tender notice regarding submission requirements.
3. Rectification of bid conditions and acceptance criteria.
4. Consideration of conditional tenders and implications on bid evaluation.
5. Analysis of relevant clauses in the tender notice and their impact on bid validity.

Analysis:
1. The petitioners sought to quash a letter rejecting their bid due to the withdrawal of an additional term mentioned in their bid. The bid was rejected by the respondents based on non-compliance with the tender terms regarding the inclusion of service tax in the quoted rates.

2. The e-tender notice outlined specific requirements for bid submission, including the need for digital signatures and compliance with specified formats. The petitioners' bid included a condition contradicting the tender terms by stating that service tax would be charged extra if applicable, leading to a conflict with Clause-34 of the tender notice.

3. Despite being called upon to rectify the bid condition, the petitioners' bid was rejected. The petitioners argued that they rectified the bid as requested and, therefore, their bid should have been accepted. However, the condition regarding service tax being charged extra was considered a conditional tender, which was explicitly prohibited under Clause-28 of the tender notice.

4. The interpretation of Clause-11 regarding the consideration of financial terms indicated that the condition in the bid regarding service tax could not be ignored as it formed part of the financial bid. The clarity and consistency in bid submissions were emphasized, and any deviation from the specified terms could lead to bid rejection.

5. The analysis further delved into Clause-30, which outlined the requirement for bids to be complete and accurate. The petitioners' argument that this clause allowed for clarifications did not apply to the condition regarding service tax, as it was a clear deviation from the tender terms and not subject to post-bid clarifications. Ultimately, the court dismissed the petition, upholding the rejection of the bid based on non-compliance with the tender terms.