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TMI Blog2018 (9) TMI 2047X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 13.71 Crores on which a GST of ₹ 2.72 Crores would be made applicable thereby taking to total CAPEX cost to ₹ 16.45 Crores and also no revision was allowed in the total OPEX cost and the entire burden of the enhanced tax rates was to be borne by Respondent No.2. The MSRTC has rightly contended that additional negotiations and acceptance by further discount by the L 1 bidder/respondent no.2 during negotiations, cannot be considered as a reason to cancel their bid. Circular dated 11 September 1917 issued by the State Government permitted negotiations with L 1 in view of the implementation of GST. Even otherwise under law there was nothing illegal for the MSRTC to have negotiations with respondent no.2 and also on the GST issue, so that the lowest bid becomes more beneficial to MSRTC. It is evident that the original tender condition pertaining to the effect that the CAPEX cost not to exceed more than 50% of the total cost, was required to be read in conjunction with the corrigendum which provided for GST to be accounted for by the bidders. The Government circular also permitted negotiation in that behalf by the tendering authority. There are no approach of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section Name Existing Clause Clause to be read as .. 7 Annexure A: Format for Financial Bid Taxes New Clause amended as: It is paramount that the supplier has to abide by the laws of new GST Implementation. New GST Taxes as applicable during the time of service delivery shall be applicable. The same has to be intimated by the supplier to MSRTC. 5. The petitioner contends that respondent no.2 had submitted its bid taking into account the GST whereby it exceeded the parameters as contained in sub clause 8 in paragraph 7.2 (supra), inasmuch as the bid exceeded the CAPEX cost, which was required to be not more than 50% of the total cost. The petitioner contends that the MSRTC ought not to have entered negotiations with respondent no.2 when principally the bid was contrary to sub clause (8) of paragraph 7.2. 6. The MSRTC has filed a reply affidavit interalia contending that there was nothing arbitrary in the decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Respondent No.2 had agreed to reduce the Base price of the CAPEX expenses and consequently the only change in prices that occurred was on account of replacement of the currently prevailing tax rates as against the tax rates quoted in the bid, and that too at a substantially discounted base price. As a result, the bid of Respondent No. 2, which initially quoted a total CAPEX cost of ₹ 15.75 Crores on the basis of a base price of ₹ 14.82 Crores and tax amounting to ₹ 0.93 Crores, was revised to a base price of ₹ 13.71 Crores on which a GST of 2.71 Crores would be made applicable thereby taking to total CAPEX cost to ₹ 16.45 Crores. I say that no Revision was allowed in the total OPEX cost and the entire burden of the enhanced Tax rates was to be borne by the Respondent No.2. 10) That the MSRTC had allowed Revision in CAPEX cost alone to reflect the GST rates. Consequently, while the original base CAPEX cost quoted by the Respondent No.2 was ₹ 14.82 Crores and the original total CAPEX cost was about ₹ 15.75 Crores with around ₹ 0.93 Crores being the tax component, after negotiations, the base price was reduce to ₹ 13.71 Cror ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... corrigendum. It is thus submitted that there is nothing illegal or erroneous in issuance of the work order in favour of respondent no.2. 9. We have heard the learned Counsel for the parties. We have perused the record. 10. It is not in dispute that the bidders requiring to take into consideration the GST, was not in contemplation when the original tender notice was issued and thus, a corrigendum dated 5 January 2017 was issued providing that the bidders should take into consideration the Goods and Service Tax rates which would be notified. Thus, the bidders including the petitioner and respondent no.2 were required to take into consideration the said condition of Goods and Service Tax as notified in the corrigendum. As pointed out on behalf of MSRTC and as noted by us above, respondent no.2 being L 1 being lowest bidder was entitled to negotiate in regard to the lowest bid offered by it and more particularly on taking into consideration the Capital Expenditure cost (CAPEX) and Operational Expenditure Cost (OPEX). The MSRTC has found that the petitioner has appropriately applied the GST in the manner in which it would be beneficial to MSRTC. Respondent no.2 in the negotiation ..... X X X X Extracts X X X X X X X X Extracts X X X X
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