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TMI Blog2024 (10) TMI 1535X X X X Extracts X X X X X X X X Extracts X X X X ..... se-6.10 of the RFP. It may be noted that in exercise of power of judicial review in respect of contracts entered into on behalf of the State or instrumentality of the State, such as Corporation, the Court prima facie concerns whether there has been any infirmity in the decision making process. In that case, the Court can examine whether the decision making process was reasonable, rationale not arbitrary and not violative of Article-14 of the Constitution of India. In ERUSIAN EQUIPMENT CHEMICALS LTD. VERSUS STATE OF WEST BENGAL ANR. [ 1974 (11) TMI 89 - SUPREME COURT ], the Apex Court held ' When the Government is trading with the public, the democratic form of Government demands equality and absence of arbitrariness and discrimination in such transactions . The activities of the Government have a public element and, therefore, there should be fairness and equality. The State need not enter into any contract with anyone, but if it does so, it must do so fairly without discrimination and without unfair procedure.' In RAMANA DAYARAM SHETTY VERSUS INTERNATIONAL AIRPORT AUTHORITY OF INDIA [ 1979 (5) TMI 144 - SUPREME COURT ], the Apex Court held ' In contractual sphere as in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hority to reject any or all the bids at any time solely based on the past unsatisfactory performance by the bidders. On the basis of the materials available, the tender committee came to a definite conclusion that past performance of the petitioner was unsatisfactory and, therefore, even if it quoted lowest price, the same cannot be accepted. Thus, the bid submitted by the petitioner has been rejected on the ground of non-satisfactory performance in the past relying upon two documents, which have been issued by the RTO, Gajapati and RTO, Nuapada and also due to non-compliance of the requirement by depositing statutory dues. This Court is of the considered view that rejection of the bid of the petitioner, even though lowest one, is well justified in view of clause-6.10 of the RFP. Therefore, there is no error in the decision making process in rejecting the bid of the petitioner so as to warrant interference of this Court in exercise of the power under judicial review - the writ petition merits no consideration and the same is hereby dismissed. - THE HONOURABLE DR. JUSTICE B.R.SARANGI AND THE HONOURABLE MR JUSTICE G. SATAPATHY For the petitioner: M/s. P.C. Nayak, S.K. Sahu I. Tripa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rformance of the petitioner was not satisfactory. It is submitted that if the petitioner s performance was not satisfactory relating to the deployment of manpower in RTO Offices earlier, then, while calling the tender on 18.07.2023, this clause should have been included so that in pre-bid meeting the petitioner could have clarified the same. Apart from the same, pursuant to letter dated 06.10.2023, the petitioner clarified that the reason given, that it has not cleared the statutory dues, is not correct and it has cleared all statutory dues in respect of the deployment made in the office and in support of the same it has filed a clearance certificate from the Provident Fund Authority. Therefore, disqualification of the financial bid submitted by the petitioner, as communicated vide letter dated 06.10.2023, cannot be sustained in the eye of law. Hence, this writ petition. 3. Mr. P.C. Nayak, learned counsel appearing for the petitioner contended that the petitioner, having satisfied the requirement of the RFP issued under Annexure-2, participated in the tender process and qualified in the technical evaluation. Thereafter, in the financial bid though it was L1 bidder, its financial bi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evaluation of qualifying criteria and opening of the financial bid, the tender committee in its meeting held on 07.09.2023, taking into consideration the past unsatisfactory performance of the petitioner as reported by the RTOs, took decision not to consider the proposal/bid of the petitioner. It is further contended that as per clause-6.10, though the petitioner was found qualified in technical bid and in the financial bid it stood first lowest, but, as its performance with regard to execution of the contract in respect of providing manpower services was not satisfactory, pursuant to letter dated 01.02.2023 issued by the RTO, Gajapati and the letter dated 09.03.2023 issued by RTO, Nuapada, its bid was not accepted. Besides, from the appraisal proposal sent to the Government earlier, vide letter dated 03.02.2023, it was ascertained that the past performance of the petitioner was poor. Accordingly, the tender committee decided not to consider the bid of the petitioner. It is further contended that since the petitioner had not paid statutory dues, its bid was also not accepted. Even if the petitioner had quoted lowest price that ipso facto would not give a right that its bid would b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is to be noted that the Technical Proposal Envelope shall contain all the documents related to eligibility criteria, terms, and conditions of tender document etc. i.e. complete tender documents except Price Bide part. The successful bidder needs to provide the bid documents with proper binding and index. The page number should be mentioned clearly against the documents. Failing of these may lead to disqualification. III. Financial Proposal Envelope: The bidders needs to submit the Financial Proposal (Price Bid) as per the given format in Annexure- 11. It is to be oted that the Financial Proposal Envelope shall contain only Prices and no conditions i.e. deviations/ assumptions / stipulations/ clarifications /comments/ any other request whatsoever. Conditional offers shall be rejected. 6.2. Qualification Criteria Office of the Transport Commissioner, Odisha shall carry out the technical evaluation for selection of eligible bidder. The bidder should meet the following qualification criteria. Sl. No. Basic Requirement Qualification Criteria Documents to be Submitted 1. Legal Entry The bidder should be: A company registered under the Indian Companies Act, 1956/2013 or LLP firm under L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tender document with each page signed and stamped by bidder. The bidder must submit all certified and authenticated documentary proof for meeting the qualification criteria and technical qualified bidders shall be considered for opening of their price proposal. Technically qualified bidders have no right to claim for award of the work. Office of the Transport Commissioner, Odisha reserves the right to cancel or award the work at any point of time. Xxx xxx xxx 6.7 Disqualification Even if the bidder(s) meets the guidelines / terms and conditions as set forth in this RFP document, Office of the Transport Commissioner, Odisha at its discretion, may disqualify any bidder(s) if: The bidder has been blacklisted by Office of the Transport Commissioner, Odisha or GoI or any State Government or Central Government or any Government agency / Department in India as on Proposal Submission Due Date; or The bidder has made misleading or false representation in the forms, statements and attachments submitted. Any attempt by a bidder to obtain confidential information, enter into unlawful agreements with competitors or influence the committee or the Contracting Authority during the process of exam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny Central/State Government Department or Central/State Public Sector Undertakings (PSUs) or any other Government (Central/ State/ PSU/ ULBs/ Smart Cites SPV) Organization in India as on proposal due date. AND Yearly billing of 2 projects must not be less than 1 Cr together. 40 Work Order/Completion Certificate from Authority. Consolidated Yearly billing invoices as per Annexure 8 2 Similar Projects = 25 Marks For each additional project 5 marks will be awarded subject to maximum of 15 marks C2 Relevant experience in Odisha The Bidder must have experience of working with Odisha Government as on Proposal due date 10 Work Order/Completion Certificate from Authority. Consolidated Yearly billing invoices as per Annexure 8 1 Project = 6 Marks For each additional project 2 mark will be awarded subject to maximum of 4 marks. Important Note: 1-The Bidder needs to submit checklist with indexing, failing of which may lead to disqualification. 2- The Bidder must submit all required document with page number and the checklist. 7.3 Financial Bid Evaluation The Bidders quoting the lowest financial quote (L1) shall be the Preferred Bidder. For avoidance of doubt, it is clarified that in case L1 b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the stipulated time to avoid payment of penalty and interest u/s 14B 7Q of the Act. 10. On bare reading of the communication made by the EPF Organization to the petitioner, it is made clear that the petitioner was advised to facilitate the finding of e-nomination by all the employees and also advised to deposit EPF and allied dues to be paid under Section-14B and 7Q of the Employees Provident Funds and Miscellaneous Provisions Act, 1952. Such instructions were issued, as the petitioner had not deposited the statutory dues and was lacking in its responsibility to comply with the statutory requirements. As a consequence thereof, communication was made to the petitioner vide Annexure-1 dated 06.10.2023 assigning reason as to why its bid was not accepted, even though it was L1 bidder in the process of bidding, keeping in view clause-6.10 of the RFP. 11. It may be noted that in exercise of power of judicial review in respect of contracts entered into on behalf of the State or instrumentality of the State, such as Corporation, the Court prima facie concerns whether there has been any infirmity in the decision making process. In that case, the Court can examine whether the decision making ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... court does not sit as a court of appeal but merely reviews the manner in which the decision was made. (3) The court does not have the expertise to correct the administrative action. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise which itself may be fallible. (4) The terms of the invitation to tender cannot be open to judicial scrutiny because the invitation to tender is in the realm of contract. More often than not, such decisions are made qualitatively by experts. (5) The Government must have freedom of contract. In other words, a fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi-administrative sphere. However, the decision must not only be tested by the application of Wednesbury principle of reasonableness (including its other facts pointed out above) but must be free from arbitrariness not affected by bias or actuated by mala fides. (6) Quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure. The apex Court also noted that there are inherent limitat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erference, the court should intervene. 18. In Master Marine Service (P) Ltd. v. Met cafe Hodgkinson (P) Ltd, (2005) 6 SCC 138, the apex Court held that the principles of judicial review would apply to the exercise of contractual powers by Government bodies in order to prevent arbitrariness or favourtism. However, there are inherent limitations in exercise of that power of judicial review. 19. The scope of judicial review has also been taken into consideration elaborately in Jagdish Mandal v. State of Odisha, (2007) 14 SCC 517. In paragraph-22 of the said judgment, the apex Court held as follows:- ..Therefore, a court before interfering in tender or contractual matters in exercise of power of judicial review, should pose to itself the following questions: (i) Whether the process adopted or decision made by the authority is mala fide or intended to favour someone; OR Whether the process adopted or decision made is so arbitrary and irrational that the court can say: the decision is such that no responsible authority acting reasonably and in accordance with relevant law could have reached ; (ii) Whether public interest is affected. If the answers are in the negative, there should be no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eliance Energy Ltd. (supra), the apex Court in paragraph-39 of the said judgment held as follows: 39. In Reliance airport Developers (P) Ltd. v. Airports Authority of India the Division bench of this Court has held that in matters of judicial review the basic test is to see whether there is any infirmity in the decision-making process and not in the decision itself. This means that the decision- maker must understand correctly the law that regulates his decision-making power and he must give effect to it otherwise it may result in illegality. The principle of judicial review cannot be denied even in contractual matters or matters in which the Government exercises its contractual powers, but judicial review is intended to prevent arbitrariness and it must be exercised in larger public interest. Expression of different views and opinions in exercise of contractual powers may be there, however, such difference of opinion must be based on specified norms. 24. In Mihan India Ltd. (supra), the apex Court in paragraphs-43 and 47 of the said judgment held as follows: 43. Bare perusal of the above stated case-law in light of the facts of the instant case makes it clear that merely having th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... committee s special knowledge plays a decisive role in deciding which is the best offer. Price offered is only one of the criteria. The past record of the tenderers, the quality of the goods or services which are offered, assessing such quality on the basis of the past performance of the tenderer, its market reputation and so on, all play an important role in deciding to whom the contract should be awarded. At times, a higher price for a much better quality of work can be legitimately paid in order to secure proper performance of the contract and good quality or work which is as much in public interest as a low price. The court should not substitute its own decision for the decision of an expert evaluation committee. 28. In Jagdish Mandal (supra), the apex Court in paragraph-24 of the said judgment held as follows: 24. The committee did not send show- cause notice to the fifth respondent before rejecting the TD passbook and consequently the tender, as Clause 3.5.18 of the Code makes it clear that acceptance of any tender is entirely at the discretion of the accepting authority and no tenderer can require the authority to show cause for rejection of the tender. 29. Therefore, the b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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