IMPORTANT POINTS :
There is a distinction between a decision taken and the decision acted upon or given effect to.
Choosing its own method to arrive at a decision is the prerogative of the State.

Headnote:(a) Interpretation – Registration – Registration Committee taking decision to grant certificate subject to conditions – Decision to grant certificate is not grant of certificate – Decision taken and the decision acted upon or given effect to – Distinction – Registration certificate being the pre-condition, appellant cannot take advantage of the decision to grant registration certificate. (Para 21)
       (b) Government contract – Instructions to Bidders – Amendment – Unamended clause requiring the bidder to be registered under CIB and documentary evidence to be submitted along with the bid – Amendment elaborating the same requiring the registration certificate to be submitted along with the bid at the time of opening of the tender failing which the bid shall be held as non-responsive – Bid of appellant liable to rejection even under unamended Instructions as production of registration certificate was an essential condition. (Para 21)
       (2006) 11 SCC 548 – Relied upon
       (c) Government contract – Judicial review – Article 226, Constitution of India – Choosing its own method to arrive at a decision, prerogative of State – State is free to grant any relaxation for bona fide reasons – Even in case of defective decision-making process, Court must exercise its discretionary powers under Article 226 with great caution – Interference required incase the decision is arbitrary. (Para 22, 23, 24, 25)
       (2005) 6 SCC 138; (2007) 14 SCC 517; (2003) 5 SCC 437; (2004) 11 SCC 485 – Relied upon
       Facts of the case:
       The first respondent floated a tender, i.e., CMSS/PROC/NVBDCP/2015-16/006 for procurement of 1 crore LLIN under National Vector Borne Disease Control Project.
       Sub-Committee for evaluation of the technical bid found that the appellant No.1 was not having CIB registration certificate in its name as categorically required in Amendment No.3 dated 28.09.2015, and further the certificate was not produced at the time of submission of the bid, and accordingly treated the bid as not acceptable being non-compliant. In the meantime, the licensing authority renewed the license for manufacturing of the insecticide of the appellant No.1 pursuant to application for renewal dated 27.10.2015 and, on 17.02.2016, the sub-Committee recommended to place the order for the insecticide product with M/s Vestergaard Group SA at the total value of US$30,407,886.
       The appellant No.1 approached the High Court in Writ Petition (C) No. 1994 of 2016 which has been dismissed.
       Finding of the Court:
       The essential condition of tender being not met with, the tenderer, the appellants herein, were ineligible and the tender was non-responsive.
       Result: Appeal dismissed.

JUDGMENT :

Dipak Misra, J.

The instant appeal, by special leave, has been filed questioning the justifiability of the judgment and order dated 10.05.2016 passed by the High Court of Delhi at New Delhi in W.P.(C) No.1994 of 2016 whereby the Division Bench has declined to interfere with the decision taken by the respondents to treat the bid submitted by the appellants as non-compliant with the conditions of Invitation for Bids (IFB) which resulted in dismissal of the writ petition and the application for clarification.

2. The appellant No.1 is a company incorporated under the Companies Act, 1956 and the appellant No.2 is a proprietorship concern and its authorized agent is a director of the said company. The appellant-company commenced manufacture of its insecticide product, Long Lasting Insecticide Net (“LLIN”). The World Health Organization Pesticides Evaluation Scheme (WHOPES) is the global body for monitoring, evaluating and approving LLIN brands, for without the said recommendation LLIN cannot be sold in the market. It is averred that WHOPES conducts very stringent tests at three levels before it gives recommendation to a product, which includes laboratory test, wash effective test and bio-efficacy field trial test, and due to rigorousness of the test, only handful of LLINs have been recommended by WHOPES and the appellants’ product that is DURANET® is one of them. The appellant No.1 was issued a license to manufacture insecticide on 08.01.2014 under the Insecticides Rules, 1971 (for short, “the Rules”) and also allowed for carrying on wholesale dealing and storage for sale. The license granted in favour of the appellant was renewed from time to time and it was valid till 31.12.2015.

3. As the facts as have been unrolled, the appellant No.2 vide application No. 45295 applied for provisional registration for the insecticides product, i.e., Alphacyphermethrin Incorporated Long Lasting Mosquito Bed Net (commercial name being DURANET®) to the Central Insecticide Board (CIB) as per Section 9(3B) of the Insecticide Act, 1968 (for short, “the Act”). The Registration Committee of (CIB) in its 354TH meeting dated 31.03.2015 approved LLIN, that is, DURANET® for provisional registration under Section 9(3B) of the Act for Public Health Programmes. We shall refer to the said decision of the CIBRC at the relevant stage.

4. The first respondent floated a tender, i.e., CMSS/PROC/NVBDCP/2015-16/006 for procurement of 1 crore LLIN under National Vector Borne Disease Control Project. Section 1 of CIB pertained to Instructions to Bidders.

Para 4 dealt with eligibility. Paragraph 5 provided for listing of the documents establishing conformity of goods and services to bidding documents. Paragraph 6 specified qualifications of the bidder. Paragraph 6(A) dealt with manufacturer bidders. After the Instructions to Bidders were issued incorporating various clauses including ones which have been referred to hereinabove, Amendment No. 3 to the bid document was made on 28.09.2015. The clause contained in 6.1(A)(d)6 in Section 1 of the Instructions to Bidders was amended. The initial paragraph 6.1(A)(d)6 read as follows:-

“6. The LLINs offered by the Bidders must be registered with Central Insecticide Board (CIB) of India under Insecticide Act 1968. The documentary evidence to establish these shall be submitted along with the bid.”

5. The amended clause stipulated as under:-

“The LLINs offered by the Bidders must be registered with Central Insecticide Board (CIB) of India under Insecticide Act 1968. The certificate of registration issued by the CIB shall be submitted along with the bid or should be at the latest provided at the time of tender opening. The bids not accompanied with the CIB registration certificate on the date and time of opening of tender (technical bid) shall be held as non-responsive.”

6. At this junction, the narrative requires to travel to the past. The application for grant of provisional registration that was submitted by the appellant No.2,

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2016 Supreme(SC) 739

SUPREME COURT OF INDIADipak Misra, C. Nagappan, JJ.M/s Shobikaa Impex Pvt. Ltd. & Anr. – AppellantsVersusCentral Medical Services Society & Ors. – RespondentsCivil Appeal No. 8461 of 2016 (Arising out of S.L.P. (C) No. 14337 of 2016)Decided On : 20-09-2016

IMPORTANT POINTS :There is a distinction between a decision taken and the decision acted upon or given effect to.Choosing its own method to arrive at a decision is the prerogative of the State.

Cases Referred (5)

SUPREME COURT OF INDIA
Dipak Misra, C. Nagappan, JJ.
M/s Shobikaa Impex Pvt. Ltd. & Anr. – Appellants
Versus
Central Medical Services Society & Ors. – Respondents
Civil Appeal No. 8461 of 2016 (Arising out of S.L.P. (C) No. 14337 of 2016)
Decided On : 20-09-2016

IMPORTANT POINTS :
There is a distinction between a decision taken and the decision acted upon or given effect to.
Choosing its own method to arrive at a decision is the prerogative of the State.