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2023 (6) TMI 54 - HC - Indian LawsAuction bid - bid applications rejected on the ground of insufficient documents - quotation of highest price of Rs. 589/- as additional charge and the petitioner had quoted Rs. 221/- - no dues certificate from GST authority not submitted - HELD THAT - On perusal of the endorsement of the committee, it is made clear that opposite party no. 4 had quoted additional charge at the rate of Rs. 589/-, but, so far as its income tax return for the assessment year 2021- 22 is concerned, a clarification was to be given by the competent authority in consultation with the concerned department/authority, and, as regards no dues certificate obtained from the CGST department, confirmation was to be made by the concerned authority. Similarly, it was observed that the petitioner had quoted additional charge of Rs. 221/-, but, however, the no dues certificate obtained from GST portal was needed to be confirmed from the concerned department/authority, if necessary, and, thereafter, the tender would be finalized. If such requirement has to be complied with, pursuant to the observation made on 05.08.2022, without getting such clearance from the respective departments and getting confirmation from the respective authority, as was observed, the authority could not have proceeded with the matter and finalize the tender in favour of opposite party no. 4 on the very same day, i.e., 05.08.2022. Thereby, the entire decision making process of the tendering authority is arbitrary, unreasonable and contrary to the provisions of law. Under these circumstances, this Court, in exercise of the powers conferred under the judicial review, has got jurisdiction to interfere with the decision making process of the tendering authority. In TATA CELLULAR VERSUS UNION OF INDIA 1994 (7) TMI 307 - SUPREME COURT , the apex Court, referring to the limitations relating to the scope of judicial review of administrative decisions and exercise of powers in awarding contracts, noted that there are inherent limitations in the exercise of power of judicial review in contractual matter. As such, it was observed that the duty to act fairly will vary in extent, depending upon the nature of cases, to which the said principle is sought to be applied. It was further held that the State has the right to refuse the lowest or any other tender, provided it tries to get the best person or the best quotation, and the power to choose is not exercised for any collateral purpose or in infringement of Article 14. Since in the instant case opposite party no. 4 has not complied with the conditions, as stipulated in the auction notice, and the committee has decided to make a verification and confirmation from the concerned authorities, instead of doing so, the same could not have been settled in favour of opposite party no. 4. In SACHIN KUMAR AGRAWAL VERSUS STATE OF ODISHA ORS. 2023 (5) TMI 1233 - ORISSA HIGH COURT , this Court already held that once the bid submitted by the petitioner was not incorporated by the bank guarantee or the previous year s income tax return, it was defective one and cannot be entertained as per the tender notice. It was also clarified in the tender notice that in absence of any documents, as enumerated in clauses-1 to 14, the application submitted by the bidder would not be taken into consideration. Therefore, fully knowing the conditions stipulated in the tender notice, the petitioner should not have filed the writ petition for consideration of the bid on the ground that he had quoted higher price than opposite party no.5. If the bid submitted by the petitioner was absolutely void ab initio, in view of non-compliance of the tender conditions stipulated in the tender notice, he is estopped from claiming the benefit, as has been claimed in the writ petition. It is made clear that the decision making process in selecting opposite party no. 4, being arbitrary, unreasonable and contrary to the provision of law, cannot be sustained in the eye of law. Consequentially, the order dated 05.08.2022 so passed by the Tahasildar, Banspal settling the source in favour of opposite party no. 4 and confirmation thereof made by the Sub-Collector, Keonjhar by order dated 20.10.2022 passed in O.M.C.C. Appeal No. 33 of 2022 are liable to be quashed and are hereby quashed. Petition allowed.
Issues Involved:
1. Validity of the bid submitted by the opposite party no. 4. 2. Compliance with the auction notice requirements by the petitioner and opposite party no. 4. 3. Decision-making process of the selection committee. 4. Judicial review of administrative decisions in tender matters. Summary of Judgment: Issue 1: Validity of the bid submitted by the opposite party no. 4 The opposite party no. 4's bid was found to be incomplete as it did not include the income tax return for the financial year 2021-22, which was a requirement as per Rule 27(4)(iv) of the Odisha Minor Minerals Concession (Amendment) Rules, 2022. Additionally, the GST no dues certificate provided by opposite party no. 4 was conditional and not a statutory certificate. Despite these deficiencies, the selection committee declared opposite party no. 4 as the successful bidder without waiting for the necessary clarifications. Issue 2: Compliance with the auction notice requirements by the petitioner and opposite party no. 4 The petitioner complied with all the requirements of the auction notice, including submitting the necessary GST no dues information downloaded from the official website. However, the opposite party no. 4 failed to submit the required income tax return for the financial year 2021-22 and provided a conditional GST no dues certificate. The petitioner's objections to the deficiencies in opposite party no. 4's bid were not considered by the selection committee. Issue 3: Decision-making process of the selection committee The selection committee's decision-making process was found to be arbitrary and unreasonable. The committee had initially decided to seek clarifications regarding the validity of the documents submitted by opposite party no. 4 but proceeded to finalize the tender in favor of opposite party no. 4 on the same day without obtaining the necessary confirmations. This action was deemed contrary to the principles of transparency and fairness required in the tender process. Issue 4: Judicial review of administrative decisions in tender matters The court, exercising its power of judicial review, found that the decision-making process of the tendering authority was flawed and not in compliance with the relevant rules and regulations. The court referred to various precedents, including Sterling Computers Ltd. v. M & N Publications Ltd. and Tata Cellular v. Union of India, to emphasize that judicial review is concerned with the decision-making process rather than the merits of the decision itself. The court concluded that the process adopted by the selection committee was arbitrary and irrational, warranting judicial intervention. Conclusion: The court quashed the order dated 05.08.2022 passed by the Tahasildar, Banspal, and the confirmation order dated 20.10.2022 by the Sub-Collector, Keonjhar, settling the quarry in favor of opposite party no. 4. The authorities were directed to conduct a fresh tender for the Karangadihi Sand Quarry in accordance with the principles of justice, equity, and fair play. The writ petition was allowed, and there was no order as to costs.
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