Back
2010 (4) Supreme 241
SUPREME COURT OF INDIA
R. V. Raveendran, R. M. Lodha and C.K. Prasad, JJ.
Shimnit Utsch India Pvt. Ltd. & Anr. — Appellants
versus
West Bengal Transport Infrastructure Development Corporation Ltd. & Ors. — Respondents
Civil Appeal No. 4441 of 2010
(Arising out of SLP(C) No. 11621 of 2006)
with
Civil Appeal No. 4442 of 2010
(Arising out of SLP(C) No. 11988 of 2010)
Decided on : 12-5-2010
1985 AC 776; 1990 64 ALJR 327; (1994) 1 All E.R. 577; (1992) 2 SCC 631; (1993) 1 SCC 445; (1994) 6 SCC 651; (1999) 1 SCC 492; (1999) 4 SCC 727; (2000) 5 SCC 287; (2003) 5 SCC 437; (2004) 4 SCC 19; (2005) 1 SCC 625; (2005) 4 SCC 435; (2005) 6 SCC 138 – Relied upon
(b) Government contract – Judicial review – Once a particular matter relating to conditions in NIT has been finally decided by the highest Court, the State Government ought to have proceeded accordingly – However, where the circumstances changed in some material respects and there is no challenge to the changed policy on the ground of Wednesbury reasonableness or principle of legitimate expectation or arbitrariness or irrationality, departure from the earlier policy cannot be held to be legally flawed. (Para 46)
(c) Motor Vehicles Act, 1988 – Section 41(6) – It has not been laid down as an absolute proposition that manufacturer of HSRP must have the foreign experience and a particular financial capacity to fulfill the contractual obligations – It has also not been held that these conditions must necessarily be insisted upon in the NIT – The judgment in Association of Registration Plates cannot be read as prescribing the conditions in NIT for manufacture and supply of HSRP – Greater latitude is required to be conceded to the State authorities – Unless the action of tendering authority is found to be malicious and a misuse of statutory powers, tender conditions would be unassailable. (Para 47)
(2005) 1 SCC 679 – Relied upon
(d) Binding precedent – Law laid down by the Supreme Court is binding – However, the decision in Association of Registration Plates cannot be held to have frozen the conditions of the NIT – That decision did not create any impediment for the States to alter or modify the conditions in the NIT if the circumstances changed in material respects by lapse of time. (Paras 50 and 51)
(e) Government contract – State or its tendering authority is bound to give effect to essential conditions of eligibility stated in a tender document and is not entitled to waive such conditions – That does not take away its administrative discretion to cancel the entire tender process in public interest provided such action is not actuated with ulterior motive or is otherwise not vitiated by any vice of arbitrariness or irrationality or in violation of some statutory provisions – It is always open to the State to give effect to new policy which it wished to pursue keeping in view ‘overriding public interest’ and subject to principles of Wednesbury reasonableness. (Para 54)
2008 (1) GLT 1020 – Distinguished
Facts of the case:
The common question that arises for consideration in the two appeals is, whether after decision in Association of Registration Plates v. Union of India wherein the conditions provided for experience in the field of registration plates in the foreign countries and a minimum annual turnover from such business were upheld as essential conditions in the Notices Inviting Tenders (NIT) for award of contract for manufacture and supply of High Security Registration Plates (HSRP) for motor vehicles, it is necessary for the State Governments to continue with these conditions or it is permissible for them to do away with such conditions.
Finding of the Court:
It is always open to the State to give effect to new policy which it wished to pursue keeping in view ‘overriding public interest’ and subject to principles of Wednesbury reasonableness.
JUDGEMENT
R.M. Lodha, J. —
Leave granted.
2.Of the two appeals by special leave, one has been preferred by Shimnit Utsch India Private Limited (for short, ‘Shimnit’) being aggrieved by the judgment dated June 27, 2006 of the Calcutta High Court whereby the Division Bench dismissed their appeal and affirmed the order dated February 20, 2006 of the Single Judge dismissing their writ petition and the other at the instance of M/s Tonnjes Eastern Security Technologies Private Limited (for short, ‘Tonnjes’) challenging the order dated March 23, 2010 whereby the Division Bench of Orissa High Court dismissed their writ petition. The Issue
3.The common question that arises for consideration in the two appeals is, whether after decision of this Court in Association of Registration Plates v. Union of India and Ors.1 (2005) 1 SCC 679. wherein the conditions provided for experience in the field of registration plates in the foreign countries and a minimum annual turnover from such business were upheld as essential conditions in the Notices Inviting Tenders (NIT) for award of contract for manufacture and supply of High Security Registration Plates (HSRP) for motor vehicles, it is necessary for the State Governments to continue with these conditions or it is permissible for them to do away with such conditions. Factual and legal background in Association of Registration Plates
4.The Motor Vehicles Act, 1988 (for short, ‘1988 Act’) came into force on July 1, 1989. Chapter -IV thereof deals with registration of motor vehicles as defined in Section 2(28). Sub- section (6) of Section 41 provides that the registering authority shall assign to the vehicle, for display thereon, a distinguishing mark (registration mark) consisting of one of the groups of such of those letters and followed by such letters and figures as are allotted to the State by the Central Government from time to time by notification in the Official Gazette. Pursuant thereto a Notification came to be issued by the Central Government on July 1, 1989 allocating group of letters to various States. The Central Motor Vehicles Rules, 1989 [for short, ‘1989 Rules’) were framed by the Central Government in exercise of its powers under Section 64 and other relevant provisions of 1988 Act. Rule 50 of 1989 Rules provides for form and manner of display of registration marks on the motor vehicles. The said Rule 50 has been amended from time to time and new system of HSRP thereunder is now to come into effect from June 1, 2010.
5.Under sub-section (3) of Section 109 of 1988 Act, the Central Government issued Motor Vehicles (New High Security Registration Plates) Order, 2001 (for short, ‘Order, 2001’). On October 16, 2001, the Central Government further issued Motor Vehicles [New High Security Registration Plates (Amendment)] Order, 2001 (for short, ‘Amendment Order, 2001’). Amendment Order, 2001 provided for certain standards in respect of the new system of HSRP for motor vehicles and the process used by a manufacturer or vendor for manufacturing or supplying such plates.
6.On March 6, 2002, a communication laying down guidelines for incorporating necessary conditions in the NIT to be issued by the various States and Union Territories (UTs) was circulated by the Central Government to all States and UTs. The guidelines, inter alia, provided; (i) the tender document would specify whether the appointment of the vendor is for the whole State or for certain parts; (ii) the tender document would specify the terms of the bank guarantee; (iii) the tender document would require a report back on certain aspects on ‘a periodic and regular basis’ and (iv) the bidder must furnish proof of past experience/expertise in this area or proof of the same with the collaborator. By further communication dated June 14, 2002 the aforenoticed NIT guidelines were modified by the Central Government and it was suggested that the bidders may be asked to provide details about the experience/capability of its collaborator to the s
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
