2018 (10) TMI 1377 - HC - Indian Laws

Tender of rates for supplying three meals a day to the students of residential schools and two meals a day for non residential schools - rejection of petitioner s tender on the ground that the petitioner did not fulfill several essential requirements of the tender - Held that - The petitioner did not satisfy as many as five eligibility criteria 1) The petitioner does not possess service tax registration number 2) The petitioner does not have certificate of Commercial Tax department 3) Whether enjoys professional tax registration or not is not clear 4) TIN/VAT number is obtained on 25.5.2016. There is no VAT clearance of past two years and 5) The petitioner had to obtain GST number in July 2017 which the petitioner obtained only on 26.1.2018. Thus the application of GST is not made within time. The main difficulty that the petitioner would face is with respect to VAT registration and VAT clearances for past two years. Condition no.2. of the eligibility criteria specified besides other things the requirement that tenderer must produce certificate of registration of GST Sales tax Incometax etc. Condition no.5 provided that the tenderer must have minimum of three years of experience of similar work. The documents were not before the authorities when the petitioner s tender was examined and rejected as per communication dated 13.7.2008. Nevertheless the objections of respondent no.2 at serial no.4 regarding not obtaining VAT registration for the past period and not showing VAT clearance for the past two years needs to be appreciated in light of these documents and facts. One of the important conditions of eligibility was that the tenderer must have minimum turn over of 6 crores in one of the two immediately preceding years. If the petitioner claims that it fulfills such requirement immediate question of registration under the VAT Act would become germane - The authorities were therefore correct in not accepting the petitioner s declaration that it fulfilled the necessary requirements merely based on said certificate dated 6.6.2018 issued by the Assistant Commissioner of State Tax Vadodara. Petition dismissed.

Summary

Issues:
Challenge to disqualification in tender process.

Analysis:
The petitioner challenged the decision of respondent no.2 to disqualify them in connection with a tender for supplying meals to schools. The petitioner argued they had been supplying meals satisfactorily for years and were unfairly ousted from the tender process. Respondent no.2 contended that the petitioner did not fulfill essential tender requirements, as outlined in a communication listing non-compliances. Respondent no.4 supported respondent no.2's decision, stating the petitioner's bid was rightly rejected, and their bid was within the government-imposed ceiling for supplying meals to schools.

The petitioner's counsel argued that the authorities erred in appreciating the conditions and documents provided, emphasizing the competitiveness of the petitioner's rates. They cited relevant judgments to support their contentions. On the other hand, counsel for the authorities and respondent no.4 opposed the petition, stating that the breaches were not technical but essential conditions that the petitioner failed to meet. They relied on judgments emphasizing the importance of strict compliance with tender terms.

The eligibility criteria specified in the tender included various requirements such as tax registrations, experience, and turnover. The authorities found that the petitioner did not satisfy five eligibility criteria, including lacking VAT and GST registration for the required period. The petitioner provided a certificate showing VAT and GST registrations but failed to address the cancellation of their TIN number due to non-filing of returns, which was crucial for meeting the turnover requirement. The court noted that the petitioner's certificates did not fulfill the necessary requirements, leading to the dismissal of the petition and vacating of interim relief.

In conclusion, the court dismissed the petition, noting that the petitioner's failure to meet essential tender requirements, particularly regarding tax registrations and turnover, justified their disqualification. The court also vacated the interim relief granted earlier but allowed the petitioner to undertake further proceedings if desired, considering the academic year's progress.